227 Parklane Ave.
Mission River, ID 57731
June 15, 1992
Verde is the manufacturer of a full line of men's-only toiletries. Because of its up and down history of financial success and failure, the new management has designed this plan to attract investors .
|1985||Bullock's and Macy's openings; GQ article, Cosmetic World cover|
|1986||Soap, Cosmetic & Chemical Specialties cover; New York Times article; Playboy feature; Esquire catalog; ABC radio hour; NACD packaging award; joint venture with Wilkinson Sword; America's Cup exclusive supplier; Saks, Foley's, Gold water's, Kaufmann's, Bloomingdale's launches; private placement|
|1987||PBS feature; Drug & Cosmetic Industry reference; showcased in 98 department stores; preparation for IPO|
|1988||IPO; fragrance introduced; Revenues reach $3 million|
|1989||Campeau bankruptcy; Verde goes into receivership; corporation dissolved|
|1990||Marcus VanDermeer buys out of receivership|
|1993||After two and a half years of decline, VanDermeer decides to sell|
Verde sells a line of high performance skin and hair care products for men. The complete line contains twelve products for a man's basic daily skin and hair maintenance:
The line currently suffers from a weak identity. The original positioning of the product was "green" - Verde translates to "green" in Spanish; the advertising featured "Natural Grooming Products For Men." Current management believes the "green" identity does not carry the strength, sustainability, or differentiation for today's market. In addition, key elements of the line were inconsistent with this positioning: brightly colored packaging; bold, high-tech graphics; department store distribution.
Repositioning of the Verde line is the critical first step. Verde is a simple, efficient daily maintenance regimen of complementary precision products. The Verde system is built for the modern man. Its basic simplicity appeals to a large, underserved market. Focusing on the performance aspect of the product satisfies a strong and newly recognized theme in men's grooming aids.
The Verde "performance" message is reinforced with brightly colored packaging, recyclable materials, clean graphics and logical coding. The new management team believes that a strong performance message stressing practicality and sensibility can be a powerful motivator for men in the '90s. The positioning statement is key, and speaks to our clientele:
The Verde management team believes that this underserved segment of men represents 30-40% of all men. The Verde man is:
Mail order health and beauty aids (HBA) for men is a $23 million segment within the $2.25 billion men's market. A targeted distribution and positioning strategy will focus on generating trial customers and leading to continuity customers and developing a loyal base of 66,000 customers within three years. Distribution will be focused on mail order during years 1 and 2. Year 3 plans include the possibility of expanding to specialty retail distribution channels. These channels include: sporting goods stores, health & fitness clubs, and country clubs.
Seven key marketing tactics will be employed to build the customer base and increase volumes:
Consistent with Verde's "performance" message, the product purchase/distribution will be streamlined and accelerated through:
The men's grooming aids market is segmented by distribution channel and positioning theme. Expensive designer lines (Ralph Lauren, Aramis, Clinique, Origins) are generally available through department stores; mid-range products (Body Shop, H20, Eddie Bauer) are sold through specialty retail and mail-order; low-end products (Gillette, Canoe, Bodycology) are sold at drugstores and supermarkets. There are six main positioning themes:
Verde will require the following skill sets from its management:
Verde requires a capital infusion of $200,000, which will be used:
Given this investment and the assumptions described below, Verde projects:
|Customer||Conversion %||Order Cycle||Annual Fall off %||Value*|
|* Note: Annual customer value does not include initial trial package dollars .|
|Year 1||Year 2||Year 3|
|Total Names Purchased||800,000||1,200,000||1,200,000|
|Rent & Utilities||0||30,000||30,000|
|Net Before Taxes &|