Eli Gladstone and Eric Silverberg are the two co-founders of Speaker Labs. They are aiming to reach $1 million in sales and a 9.6 satisfaction rating from their customers in fiscal year 2019. To reach their goals, they must decide on a new promotion strategy and decide whether or not to introduce a new service such as different workshop topics or online courses to their customers.
To reach their goals, Speaker Labs should introduce a new online course containing the important topics from their in-person workshops. By only including the important information from the workshops, they can prevent this new alternative from replacing the company’s other services. The online course will contain 8 hours of content, with instructional videos, quizzes, readings, tutorials, and individualized feedback to give customers an easy way to develop their skills.
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The prices of the company’s workshops should increase to bring in more revenue to make their sales goal easier to obtain and so that Speaker Labs better compares to its competitors. The price of the corporate workshops should be increased from $1495 to $2,000 and the price of the lunch and learn sessions should be changed to $4,000. The price of the public group workshops should increase to $2,000 as well to match the corporate workshop price. The new online course should be priced at $1,250 so that they can meet their sales goal, while still not having them replace the company’s main focus, which is their in-person workshops. These prices will help the company bring in more revenue in a more efficient way.
Speaker Labs should continue to use Google Ads, as well as create a Facebook page and start using Facebook Advertising as a new way to promote the business. Since the company currently only uses Google Ads and relies mostly on word-of-mouth referrals, the new promotional strategy will allow the company to reach more potential customers. The budget of advertising on Facebook should be $20 per day, which will allow for 7 clicks per day. With this budget, 43% of the company’s sales will come from Facebook. The advertising budget for Google Ads should also increase to $12 per day so that they can continue to gain customers from both platforms. They should hire a new employee to take care of their advertising to save Silverberg and Gladstone more time to plan and deliver workshops. This employee should be paid $400 per month to run the two advertisement pages.
These decisions will help Speaker Labs reach their sales goal for fiscal 2019 by providing new and more efficient ways to produce revenue, while still allowing Silverberg and Gladstone to run their business as usual. Using the recommended product offering, pricing strategy, and promotional strategy will be beneficial for company growth and continue to satisfy customers.
Marketing Challenge
Eric Silverberg and Eli Gladstone are the co-founders of Speaker Labs. They are looking to grow their business and reach their sales goal of $1 million in 2019, as well as increase client satisfaction to a rating of 9.6 out of 10. In the past, they have seen an increasing trend in sales and are hoping to continue this in the future. To do so, the two must decide whether or not to introduce new workshops on different topics or introduce online courses. They also must decide on a way to promote their company so that they can attract more customers and increase sales. Their current pricing strategies seem to be working well for the company so far, though they should revise and see if any changes are needed.
Internal Analysis
In previous years, the company has done very well with sales and are aiming to continue this trend. They have not invested a huge amount of money into the business in the past, which may pose as a potential issue when thinking about expanding in the future as they have little experience doing so. Although, it may be beneficial for the company to invest more money to reach their sales goal in following years. Most of the current workshops are low in operational costs; so, finances do not seem to be a current issue, and they should have the sufficient money to use to put towards developing the company. Speaker Labs has not done much advertising in the past, instead, they have mainly relied on their current customers to refer them to new clients. Perhaps changing their method of advertising and directing it more publicly will aid in the achievement of their goals. The company uses Google Ads to promote their business, however, it does not have as much of an impact as the word-of-mouth referrals do. Since they do not have much exposure to the public, they may be able to increase sales by using a different form of advertising to reach a greater audience. The company has only two employees who handle almost all of the operations of the company, with an exception to their Google Ads page. This may be an issue when expanding as the two might need some help handling any expansions.
PEST Analysis
Speaker Labs workshops are a luxury purchase, thus, causing individuals with little disposable income to lose interest in the company. This would become a greater issue if the economy went into a recession as the company might not be able to survive. This is not a current problem as the economy is not in a recession, so, they do not have much to worry about as of right now. People are relying more and more on technology for various things, including skill development. Since Speaker Labs is not currently an online platform, the company could eventually go out of business if they do not keep up as this trend continues.
Competitive Analysis
Speaker Labs’ competitive advantage is their in-person training and classroom environment. Dale Carnegie Workshops are Speaker Labs’ first and largest competitor (Exhibit 1). Dale Carnegie is a very well-known company which offers seminars and workshops on many different business topics, some closely related to those of Speaker Labs. The classes are slightly more expensive than Speaker Labs and they do not target the technology sector as Speaker Labs does. The popularity of Dale Carnegie’s workshops threatens Speaker Labs as consumers may associate the workshops’ reputation with reliability. Toastmasters International is another one of Speaker Labs’ competitors. Toastmasters International is a non-profit organization that uses a club format to help their members with their public speaking. The members are able to give speeches and get feedback from other members during the club hours. This is a much cheaper option than Speaker Labs, which may steer more customers who are looking for simply public speaking help into consuming from this company. Since anyone is able to give feedback, the information from this company may not be reliable which gives Speaker Labs a greater advantage. The Second City is also a competitor for Speaker Labs. This is a famous theatre organization that offers different training programs for members with the goal of developing new skills. The Second City’s primary focus is on public speaking in general which differentiates from the focus of Speaker Labs which is more professionally focused. They do have a corporate arm which is priced significantly higher than Speaker Labs’ workshops. Due to Speaker Labs’ lower prices and greater emphasis on business, they have a better advantage to gaining new customers than The Second City does. The last competitor to Speaker Labs is digital services for public speaking. With growing technology, there are now many different digital services and apps that are made to help people develop their public speaking. These apps have much lower prices and are able to reach a much wider audience because of their online format. Some of the apps even used human coaches to help their clients, as well as artificial intelligence. These apps are much more convenient than the workshops held by Speaker Labs, although the in-person approach that Speaker Labs has is believed to be much more effective than the online formats.
Consumer Analysis
Speaker Labs currently has two different kinds of consumers, corporate and individuals, although their main focus is their corporate clients, specifically from the technology industry. Corporate clients are different organizations that wanted to improve their employee’s skills. Businesses in the technology industry are the company’s current target market, who currently make up 70% of Speaker Labs’ customers because both Silverberg and Gladstone are experienced in the industry, therefore the workshops are more beneficial to these clients. The company was looking into expanding into the financial sector and law firms for future sales. Both of these options would work for the company because of their focus on business presentations. The owners have experience working in the business department at Ivey Business School and at Ryerson University. Since they are educated in the business industry, their workshops would be beneficial for customers in these different industries.
The company also has individual clients who are seeking public speaking development on their own. Similar to corporate clients, most of these individual customers come from the technology industry because that is the company’s main focus, although they do have clients from many different industries. The company has a good reputation to those in the technology industry because that is what their company has become known for. If the company were to target different industries, this may take away their reputation and they could potentially lose sales from technology businesses.
Target Market
Speaker Labs should target large corporations in the technology industry rather than the financial sector or law firms. This is the company’s current target market and they have a good reputation to customers from this market. If they were to target the financial sector or law firms, they would have to change some of their content to ensure they are catering to their new customers, which would take a lot of extra work. Instead, the company should invest their time into using a more direct approach to reach the technology industry. Gaining more customers from the technology industry would have a very positive effect on future sales and help the company reach their goals.
The Marketing Mix
Speaker Labs should introduce new online courses as their first step toward growing their company. An online platform would allow Speaker Labs to reach a greater audience and provide a more convenient way for people to develop their skills, while also increasing sales. This decision is a more expensive option than introducing new workshops, but in the end, will better grow the company when considering how the world is becoming more dependent on technology. The online courses should include all of the components that Silverberg and Gladstone have already considered such as instructional videos, quizzes, readings, tutorials, and individual feedback, but should include only the highlights from the in-person workshops. Only including the highlights from the in-person workshops will prevent the new platform from replacing the main services of the company. The course will be delivered on the company’s new website which will have a cost of $10,000 to start and plan, and $1,500 each year to maintain it. Since Silverberg and Gladstone are already in charge of all of the day-to-day operations for the company, perhaps hiring someone new to develop and maintain the new website would be a good idea. The two should help to plan the website and courses and decide which content is to be included, but the new employee would take care of all other operations pertaining to the website. This way they will not miss out on as much time to deliver workshops and can still expand the company. The new employee should also be responsible for any other online operations such as advertising.
To compete with the Dale Carnegie workshops, Speaker Labs should increase the prices of their other services. Since they consider their workshops to be of higher quality, increasing the prices will help prove this to consumers. If the company increases the price of the corporate workshops and the public workshops to $2,000 per person and increase their lunch and learn session price to $4,000, they will better compare to the Dale Carnegie prices. Increasing these prices make the sessions more beneficial for the company by producing more revenue to help the company reach their sales goal. The price for the online courses should be lower than the prices for the in-person workshops. An assumption can be made that online sales will account for 15% of the company’s total revenue. This makes sense because if the company is aiming to double their sales, 65% of revenue coming from public workshops would require a lot of extra work from Silverberg and Gladstone, which they might not be able to handle. The online courses should have a price of $1,250 for 8 hours of content which is reasonable when comparing it to the price of $2,000 for 12 hours of detailed content. The sales goal for these online courses is $150,000 in 2019 which would require the company to sell 120 online courses. This number is reasonable because the company has sold more of their other services in previous years and online courses would likely be easier to sell. The lower price of the online courses will convince consumers that the in-person workshops are more beneficial for them because higher prices are often associated with higher quality. If people were to use the website prior to attending an in-person workshop consumers might become convinced that attending the in-person workshops will lead to further personal development. In other words, by using the website, they might get a small amount of learning but will be able to gain more knowledge by taking advantage of the company’s other services. This would be beneficial for Speaker Labs because if consumers began to do this, they would be producing more revenue from each individual consumer.
The company should continue using Google Ads as they already are to promote their services. To promote the company to new customers, they should create a Facebook page and use Facebook advertising. Facebook is a social network used by a huge variety of people which will give Speaker Labs greater opportunity to gain new customers. The new employee hired for online operations should be in charge of the online advertising for the company to save the two co-founders more time. The employee can run the new Facebook page and the Google Ads page and can make decisions about the company’s advertisements. Since the company currently pays someone $200 per month to maintain their Google Ads page, perhaps they can pay them $400 per month for the employee to run both of Speaker Labs’ advertisement pages. Facebook advertising can be used to target specific people by using different filters for their advertisements, therefore this will be an easy way for Speaker Labs to reach their target market. The company should use filters such as public speaking, business, and technology so that they will be able to have their advertisements reach people who will benefit from the company. Google Ads, they are currently using the cost-per-click method which seems to be working well for the company, therefore, they should use this same method with Facebook. The average cost per click on Facebook is $2.72, which is a similar price to the cost per click for Google Ads. The company’s current advertising budget for Google Ads is $10 per day, which they should increase to $12 per day. They should have a budget of $20 per day for advertising on Facebook. This will give the company an annual advertising budget of $16,480. This budget would allow 2,555 clicks per year on Facebook and 43% of total sales would come from these clicks. Since the company needs to sell 120 online courses, these advertising budgets are reasonable to get the required sales. After one year, the company will be able to see the effectiveness of the advertising strategies and potentially raise their budget so that they can reach even more consumers. To measure the effectiveness of Facebook Advertising, the company should have their clients indicate how they heard about Speaker Labs when they register on the company website. They will also be able to see how many people view their advertisements from both platforms and compare this number to the number of new customers.
The company currently holds their private workshops and lunch and learn sessions at their client’s offices in Toronto and they hold the public group workshops for individual clients at a computer coding school called HackerYou located in downtown Toronto. The placement of these workshops is good for the company because they are able to keep the costs low by reducing the amount of space they need to rent out. They should keep their distribution methods as is, with the addition of new courses distributed online.
Conclusion
In conclusion, Speaker Labs' target market should be technology companies. They should target this group by introducing new online courses at the price of $1,250 per person and the new workshops should be promoted on Facebook advertising so that the company can directly reach their target market. These changes to the company will help them achieve their sales goal of $1 million and receive greater client satisfaction.
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