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Summary of Simulation Elements
The Game World: A 3D Conceptual Map
The game world is a 3D interface that connects the principles and practices of marketing. We call this a 3D
Conceptual Map. It’s an interactive, animated view of the elements of marketing: Market Segments, Product, Price,
Place, Positioning, and Competitors. Each element occupies its own area of the world and are connected to other
elements by an animated path. Players travel around the map, zooming in on different elements to examine data
and information, or clicking on various elements to bring up controls and other panels.
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Target Market Segment
In each game, players analyze market segments and select one to target. The various market segments
have different demographic characteristics, product use demands, price sensitivity, and other
preferences. These characteristics determine the product offerings that target market segments will
prefer and buy.
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In the game, there are five market segments:
The following factors differentiate the market segments:
◼
General characteristics: size, growth rate, purchase frequency, etc.
Product Development
Once students have identified a market segment to target, they must design a backpack to meet that
segment’s needs. The 3D Backpack builder lets students see the characteristics and differentiating
features of the pack they create. Players design a backpack by choosing its shape, straps, material, color,
and special features. Each choice they make affects one or more of the backpack’s characteristics. For
example, changing the fabric may affect the backpack’s durability, cost, and weight. A 3D model of the
backpack changes before the player’s eyes as any change in the backpack features are made by the
students. The characteristics of each pack update 2D data readouts.
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Backpack characteristics
The backpack building system links tightly with the market segment system. Players craft their packs
from a base set of designs and variations, choosing materials and equipping their packs with special
features. Different backpacks will appeal to different market segments. Once the first round has
been completed, all six backpacks display in a 3D competitor hub, as shown below, allowing players
to make quick visual as well as numerical comparisons.
Each backpack has five key characteristics. These characteristics are a part of the criteria consumers use
to evaluate the backpacks when making a purchase decision (in addition to price, place and promotion).
The characteristics include:
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Backpack Selection Options
The five key characteristics are a roll-up of the Backpack options players can choose. The options
players have include:
Backpack Shape Options
The shape options determine the base size and look of the pack. The backpack shape chosen will affect
the cost, capacity, and comfort level of the backpack created.
Shape options include:
Backpack Strap Options
The strap options determine the type of straps of the pack. The backpack straps chosen will affect the
cost, comfort, and durability of the backpack. Strap options include:
◼
Thin Spaghetti
◼
Basic
Backpack Material Options
The backpack materials chosen will affect the cost, comfort, durability, weather resistance, and eco-
friendliness of the backpack. Materials include:
Colors
Players will be able to choose from a small number of color options for each main style of backpack.
The color system will be simple. Target markets will have preferences for color. For each possible color
of backpack, each target market will either:
◼
Prefer that Color (adds a bonus to your backpack’s attractiveness to the segment)
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Special Features
Special features are additional desirable add-ons and improvements to base materials and designs.
Special features can affect the characteristics (Capacity, Durability, Comfort, Weather Resistance.)
Special features may also be specifically looked for by a target market, and thus can provide a
competitive advantage for the backpack in the market place. The list of special features include:
◼
Water Bottle
◼
Cartoon Graphic
Production Cost of Backpacks
Backpack design options and special features all have associated production costs. Players will see
the additional cost of each selected option or feature and see a display of the total production cost
for their pack.
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Pricing System
Pricing in the real world is a multifaceted and complex decision. For Practice Marketing, we developed a simplified
model for Price Sensitivity based on the Van Westendorp Price Sensitivity Meter (PSM.) PSM is a market technique
for determining consumer price preferences that has been a staple technique for addressing pricing issues for the
past 20 years and continues to be used widely throughout the market research industry. Our pricing model
support luxury as well as low-cost price preferences.
Here’s how it works:
1. Each target segment has a price-sensitivity curve with four key price points.
i. Too expensive: the price at which the segment considers the backpack so expensive
that they would not consider buying it.
3. The four points can be adjusted to create luxury or low-cost (highly price-sensitive)
buyers. For a luxury buyer, the “too cheap” price point is relatively high because the
buyer wants to pay a higher price and will also be looking for luxury attributes and
features.
We chose this model because rather than just saying lower is better, we thought that the idea of
having levels where a price could be subjectively seen along a gradient as too cheap or too
expensive was interesting. We borrowed this idea from the Van Westendorp Price Sensitivity
Meter approach that companies could use to determine a price that meets their strategy.
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Distribution System
In addition to selling products directly to consumers, players have the option to work with
channel intermediaries. Players can review distribution channel options, looking at terms,
demographics, and other factors, and make deals with retailers to develop a profitable channel
management strategy tailored to their product and target market segment.
Distribution Channel Options
Direct Distribution
Companies can sell to consumers directly. There is a pool of consumers in the world available to
the player’s company. Players receive 100% of the proceeds of those sales (no
retailer/wholesaler cut). We have abstracted out shipping, transport, and overhead costs.
Direct distribution is one of the sub-hubs found in the Place hub.
Distribution Channels – Companies can also establish distribution deals with retailers of varying
sizes, opening them up to a greater universe of consumers. There are six distribution channels
in the world. The channels include:
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Retailer channels have the following key properties:
•
Customer Reach – How many customers served each turn
•
Customer Mix – Breakdown of distributor’s customers across target markets
•
% MSRP the channel will pay for a pack – affects margin
How Distribution Channels Affect Game Play
Distribution channel management adds a new layer of complexity to decision-making in the game.
Players must carefully evaluate each retailer, looking for the optimal places to sell their products.
Types of questions players might ask:
✓ Where does my primary target buyer typically shop?
✓ Where will my pack attract customers at the price point I have set?
✓ What channels will broaden my pack’s appeal to secondary market segments, thus expanding my
product’s market reach?
✓ Where are my key competitors’ products sold?
Players also have the option of making concessions to get into specific retail stores. For example, a
big box retailer might not carry your pack above a certain price. As such, you must weigh the cost
Market Development Funds (MDF)
Each channel partner responds positively to market development funds. An investment in MDF increases
the sales force dedication in that channel. The partner will push your product harder, thus improving
sales. But by how much exactly? You sacrifice some margin to boost sales, so it’s important to keep a
close eye on whether the sales increase warrants this ongoing investment.
Channel Promotion Discount (Sales Promotion)
Within each Channel, players also can offer a Promotional Discount Program that works like a
5.00 rebate. This is an optional program to improve buyers’ opinion of the pack’s price in that
channel. The cost of the program will be the revenue that the player does not get (5.00 off the
price x # sold) because of the discounted price.
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Integrated Communications: Positioning, Promotions and Product
Awareness
The integrated communications system has two main components: choosing a positioning message
and purchasing a promotional campaign. Your positioning message spreads across the chosen
promotional vehicles, raising product awareness levels/desire for the backpack, which in turn
contributes to more sales.
Two Components of Integrated Communications
Integrated communications consist of two main components:
These two components work in tandem. Setting a positioning message does nothing without a
promotional campaign to get that message out to the public. Together, a company’s Message and
Promotional Campaign work to increase consumer segment’s Product Interest Level.
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Product Interest Level (AIDA): Effects of Integrated Communications
The player’s integrated communications/promotional decisions aggregate into a single value, a
product interest level based on the AIDA (Awareness, Interest, Desire, Acquisition) concept.
Imagine Product Interest Level represented on a scale from 1-10. Effective integrated
communications will move market segments further along that scale, as they go from being
A Segment’s Product Interest Level will decrease over time if player (a) stops promoting; (b)
switches to a campaign that does not reach the target segment effectively, or (c) switches to a
Message that resonates less well with the intended buyer.
Product Interest Determines Product Visibility
Product Interest Level determines the percentage of total consumers in each distribution channel who
will consider purchasing your product. The game designates a predetermined mix of consumers who
shop in each distribution channel. Your promotions campaign builds awareness and interest among
Selecting a Positioning Message
In the positioning hub, players choose from a menu of positioning messages. The challenge is to
determine which messages appeal to their target market and to decide how many messages to choose.
Players can choose any number of positioning messages. However, the more messages a player
chooses, the less clear the overall message becomes. Piling on descriptors lowers the message’s
credibility, as multi-part messages tend to contradict each other. Compare the high/low Clarity of the
two messages below.
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Evaluating the Power of a Positioning Message for each Segment
The Power of a positioning message for each market segment consists of the degree to which that specific
segment CARES about the message, modified by the STRENGTH of your message. Strength of positioning has
three components:
Evaluating messages
Market segments care more or less about a given positioning message. The first factor that determines the
effectiveness of a positioning message is CARE:
How much does this market segment care about this positioning message?
(Higher the #, the stronger the message for the market segment)
Positioning
Message
School
Children
University
Students
Business
Commuters
Outdoor
Enthusiasts
Luxury Trend
followers
Fun
50
25
0
25
0
Luxurious
0
20
40
0
40
High Quality
13
13
25
25
25
Great Value
50
50
0
0
0
Tough
25
0
25
50
0
Peak Performance
0
0
33
67
0
Smart
17
33
33
0
17
Safe
29
14
29
29
0
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Professional
0
0
40
40
20
Classic
0
0
50
0
50
Funky
25
50
0
0
25
Lightweight
20
20
20
40
0
Eco-Friendly
20
40
0
40
0
Cutting Edge
0
17
17
33
33
Fashionable
0
40
20
0
40
The message score is then modified based on Clarity, Consistency, and Competitiveness, starting with
Clarity. The message strength score is multiplied by the Clarity Score.
Clarity Score
# of messages selected
Clarity Score (0-10)
1
1.0
2
.8
3
.5
4
.2
5 or more
.05
For each message, you get a consistency bonus multiplied by your care factor score. Your message can
double in strength if you keep it consistent over time.
Consistency Bonus
# of turns in a row have
advertised this message
Consistency Score (0-10)
New message
1.0
1 turn
1.2
2 turns
1.4
3 turns
1.6
4 turns
1.8
5 or more turns
2.0
Finally, now multiply by your competitive score. If other competitors are using a similar message, this will
decrease your score. If your message is unique, this will increase your score.
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Competitive Score
# of competitors also
choosing this message
Consistency Score (0-10)
0
1.0
1
.9
2
.8
3
.7
4
.6
5
.5
The result:
Message Strength = CARE Value x clarity score x consistency score x competitive score
Advertising: The Media Campaign
Promotional Mix – Advertising
Running a media campaign is a key component of Integrated Communications. Advertising campaigns have
these major features:
Advertising Budget
As you make decisions to buy media, Practice Marketing captures spending data and reports it as part of your
company’s Promotions Budget. This budget displays as a percentage of Revenue in Financial Reports.
Advantages for this approach are:
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• Budget and spending strategy can change as revenues grow. Students face the limitations imposed by
revenue (or lack thereof), but a student with lower revenue can still spend a higher % to compete.
• Students can practice pulse, drip, and blast strategies without being limited by the system.
AD Buys: MEDIA CLASSES and VEHICLES
Players use funds from their budget to purchase advertising space in specific Media Vehicles within one of
five Media Classes (Print, Internet, Television, Radio, Poster.)
Media Vehicles
Class
Vehicle
Circulation/Reach
Rate
Posters
Gym and Sporting locations
3,770
250
Subways
10,120
500
Billboards
12,520
600
Print
Newspaper
15,870
1,000
Financial Journal
12,930
650
Fashion Magazine
10,730
750
Outdoor Adventure
Magazine
17,550
800
Comic Book
17,780
450
Radio
Top 40
30,500
1,600
Sports Talk Radio
16,300
1,000
News Radio
21,450
1,150
TV
National Network
55,100
2,600
Wilderness Cable Network
29,980
1,500
Cartoon Channel
34,670
950
Internet
Online news
24,450
1,400
Celebrity gossip blog
20,230
1,100
Gaming site
24,020
700
Cost of Media Vehicles:
A variety of factors determine the actual cost of advertising in different vehicles. The two top factors are
typically:
1.
Reach: How many people will this vehicle reach (circulation, page visits, viewers, listeners, etc.)?
2.
Value (purchasing power or influence) of people reached.
Ad Frequency within each Vehicle
Demographics of Advertising Reach for each Vehicle
80%
60%
40%
20%
0%
Financial Journal
Newspaper
Gym
Trendfollowers
University
Outdoors
Commuters
Schoolkids
Gaming Site
Celebrity
Online News
Cartoon
Wilderness Cable
National Network
News
Sports Talk
Top 40
Comic Book
Outdoor Mag
Fashion Mag