Jennifer Y. Martelino

PROJECT OWNER’S FINAL REPORT Project Title: V-LL – P1 – Viability of the Pricing Model Project Owner: Jennifer Leadership Team: Alona Ching Chris Gray Jorge Laraib Tatiana Summary of Project Approximately 200 words. We strongly recommend that you write this when the report is finished. It should briefly outline what you did, why you did it, key outcomes and recommendations. Aim To start and grow to the point where it offers one initial outstanding marketable minimum viable service (MVS), and then expand our offerings. Objective To assess the viability of Laser Lilly’s pricing model in terms of: How many college females are presently utilizing laser hair removal services? How many college females would like to utilize laser hair removal services if the services were free? How many college females will pay $49.99 per month to have a one-year membership that provides them with 6 laser hair removal treatments in East Baton Rouge Parish, Louisiana. Why or why not? What is the most they would be willing to pay per month if the services we performed in connection with a one-year membership? (Raging from $0 to $150) What is the most they would be willing to pay as an upfront lump sum for 6 laser hair treatments as opposed to a one-year membership with monthly payments? (Ranging from $0 to $750) Demographically (in terms of age, race, economic status, level of education, income level) of the above college females? What grade level are the above college females in? (Freshman, Sophomore, Junior, Senior, or Post-Graduate) How much more would our target market be willing to pay to transition from waxing to LHR? Methods and Approaches A number of methods and approaches were used to facilitate the research and the survey: Research (RPM Blocks 1 and 2 except 1c and 1d): Online researches were done via Google, Yelp, and social media platforms – Facebook, Instagram, Data especially pricing were not available in the websites of LHR providers so email and query forms were used to obtain data Connected with market influencer was also done to get leads Questions were posted in social media platforms to obtain direct answers Google Trends was used to get the interest trend of LHR in Google Search Pretended to be potential customers just to get the pricing of the existing LHR providers in the market Qualitative approach was used in analyzing the research work of everyone Survey: Used Google Form - a survey administration app Sought the help of Gray and Tatiana who are living in EBRP – the location of our target market, who have friends that are college female students. Survey questions were constructed, scrutinized and discussed thoroughly Information about the survey was circulated initially through word of mouth to the female college friends of Gray and Tatiana, and the survey itself was disseminated via email. The survey was analyzed using simple statistics (average, means, and charts). Survey responses are automatically saved by Google Form and by default, it saves each answer in the Responses tab, showing summary graphs and lists of answers. An individual response view shows the live form along with the results from each respondent. Research Evaluation RPM Block 1: For the MRS to design a structured cost-effective method of obtaining data. A. Identify all the possible cost-effective sources/methods for data collection we should use to gather information (surveys, polls, forms, social media, etc.) – Assigned to Jorge Among Jorge’s recommendation, the most cost-effective method to gather data based on this research is FB Lead Ads via CPC which is $1.80 per click but there is no guarantee that we can generate leads when someone click on our FB Ad. Therefore, there is a big chance that this undertaking could be costly and futile. B. Gather leads/database for college females in EBRP through the sources identified above. Assigned to Ching Lead generation is not something that can be plucked out of a normal research in Google or any other search engine for that matter. This requires the service of lead vendors or providers that have skyrocketing rates. Using the qualitative approach which is to reach out to health/beauty influencers turned out to be ineffectual as it requires a credit card number to sign up for the free trial. C. Design a survey to gather the data – Assigned to Jorge and Ching Survey questions were constructed by Ching and Jorge then deliberated by Ching, Jennifer, and Gray, and approved by Chris. These questions were created based on the objective of the project. Google Form was utilized for this survey. The following is the link to the Google form: https://docs.google.com/forms/d/e/1FAIpQLSeA1b7wWFanXw3XtXdU7_PIo6okIPoygL9fVzbtkgNyLHVaGQ/viewform?usp=sf_link D. Conduct survey in EBRP, gather data Gray and Tatiana conducted the survey and targeted their college female friends and their strategy to reach out to their friends and to the friends of their friends to create a snowball effect was very effective. As advised by Jorge, the target number of respondents to obtain an accurate data is 30. We were able to get 32 respondents in 3 days. RPM Block 2: Research market trends in terms of pricing and features of Laser hair removal and existing waxing competitors in EBRP A. Research market trends in terms of pricing and features of Laser hair removal in EBRP – Assigned to Jennifer A comprehensive research was painstakingly made on pricing and features on the context of market trend for laser hair removal in EBRP, to no avail. Given this fact of unavailability of resources for now, to get an overview of what the market is, in general, I conducted research for the features, prices, and the reviews, out of context of the market trend. Google trend was also utilized to get a glimpse of the market interest trend. It uses graphs to compare the search volume of different queries over time. Though not conclusive of what the market trend is Google Trends is not conclusive of what the market trend for LHR is in EBRP as it only measures the search queries in Google Search, it will still, at least give us an overview of the interest trends of our target market. Comparison of the search queries was made between waxing vs. LHR, and results states that there is lesser queries or interests for LHR than waxing. My research has reached a stone wall as Market Trend research is actually a very complex method to read the market that requires thorough research from a Market Research vendor hence, the enormous cost Market Trend research is not as simple as typing the key words in Google search and it will yield the result we want. B. Research waxing price models. Include questions in survey. How much more would they be willing to pay to transition from waxing to LHR? – Assigned to Laraib This research proves the misconception that waxing is cheaper than LHR. When computed on an annual bases, LHR proves that it is more cost effective considering that based on the comparative table I have made based on the competitors’ pricing researched by Alona, the average of LHR for 13 sessions would be $ 1900.42 but based on Laser Lilly’s pricing model, 13 sessions would only amount to $1,299.74, whereas, waxing, based on Laraib’s analysis, for 13 sessions would be $4,485. What is preventing the target market to transition from waxing to LHR is the lack of factual information about LHR which I believe is easy to remedy on the premise of marketing. Given these facts that resulted from this very enlightening research, we can say that LHR, with proper marketing campaign, can definitely steal the market share of waxing. C. Identify our competitors and the price packages they offer, their clientele and their market share in laser hair removal niche – Assigned to Alona Based on the research of competitors’ prices and features by Alona and the comparative table created by Jennifer, we can say that the price model of our Laser Lilly is, indeed, very competitive. The market share of these competitors, however, is not something that can be easily obtained by searching it in Google or in any search engine website. It entails an intensive market research that requires the service of a market research vendors that is very costly. RPM Block 3: For the MRS to perform data analysis and send comprehensive report. A. Determine data analysis techniques in order to get a meaning out of that data – Assigned to Jorge Qualitative approach To handle my teammate's reports, I will do a comparative analysis between Alona’s and Laraib’s documents also, to complete the description I will use Jennifer Waxing Comparative Chart. Ching's and Jing's reports are going to be used as an overview and difficulties of the study. Quantitative approach. The survey will be analyzed using simple descriptive statistics (average, means, and charts). There is not enough base to do multivariate analysis but this won’t affect the result of the project. B. Create a comprehensive report for the team that provides conclusive remarks on the viability of our pricing model – Assigned to Jorge The Market Research Specialist’s Report Qualitative Overview Waxing Waxing seems to be the top of mind when referring to hair removal, probably due to a common belief that is cheaper than other options like laser hair removal. Also, this offers convenience as could be done at home in some parts of the body. There is also a feeling of immediateness using waxing that other methods didn’t offer. As Laraib’s document reports, there are some factors to consider between choosing waxing or laser hair removal: Factors that motivate college females to choose wax: Pricing for wax is lesser than laser hair removal (that’s a short-term view) Lack of trust in the laser results, they have been told that hair comes back at some point in time Insecurities about the process safety Bad experiences of their peers with LHR Factors that motivate college females to transition to LHR: Monthly pain Intensity and volume of hair on their body Hirsutism and PCOS sufferers need a permanent solution LHR has long-lasting results if not permanent Waxing Price Models On the short-term waxing seems to be cheaper than laser hair removal, here are some examples collected by Laraib: Full body neck to toe: $283 Full face: $47 Total package: $345 So if a college female gets herself waxed every 4 weeks that would make 13 sittings per year with a total average cost of $4485 for full body. These are the minimum prices for standard body size, these may be higher for women with greater BM Laser Hair Removal In our qualitative approach, LHR seems to be well received by the customers, they seem to be very keen to use the service, and the ones who have used it before are very willing to pay for it again. However, customer experience and promotions are key drivers of this market because it is seen as an expensive outlay. Laser Hair Removal Price Models As Alona reported and summarized by Jennifer, the prices for LHR widely varies depending on body parts, skin and, hair color. Laser Lilly seems to be very competitive among other places. Establishment Ave. Price/month Ave. Annual Price Ave. Price/session Laser Lilly - 6 sessions/yr - for all body parts- BodyBrite Baton Rouge (1 service per month- BodyBrite Baton Rouge (2 services per month) 99.95 1,199.40 49.98 Body Image Aesthetics 281.26 Louisiana Laserderm 231.06 Louisiana Women's Aesthetics 108.64 Groupon Voucher Effect As shown in Jennifer’s report, Groupon is a page where people can find good discounts and LHR is not an exception, it’s important to notice that the companies in Groupon offer better prices than Laser Lilly, details as follow: Package Regular Price Discount Groupon Price No. of people who bought Ave. Price /Session Six Laser Hair Removal Treatment for Medium Area $1,500 77% $342 680+ $57 Six Laser Hair Removal Treatment for Large Area $2,100 78% $455 970+ $76 Establishment Ave.Price/month Ave. Annual Price Ave. Price /Session Difference LL vs. Groupon Laser Lilly - 6 sessions/yr for all body parts $49.99 $599.98 $99.98 $22-$43 Quantitative Overview  Survey  A survey was conducted to validate the insights gathered on the qualitative phase; we used a self- administered questionnaire through Google Forms.  Sample  We used a snowball effect to contact 32 female students. They are all single, their age ranges from 23 to 25 years old (59%), Full-time employed (47%), Bachelor's degree (47%) and with an income of $51,000 or more (50%).  As we can see above, most of the females interviewed have a higher degree than college. This could be their second, also could be related to the people Gray could contact that were already graduated. Results  More people use waxing than laser hair removal. 59% percent of the females interviewed declared that they do waxing at least once a year. This number went down when we refer to LHR (19%).  However, 77% of the interviewees are keen to use the laser hair removal service and, of those, 27% declare they are "very likely", and 50% somewhat likely to do laser hair removal soon. We can narrow the number of people interested in doing LHR when we ask if they think they need it. The percentage of interviewees that declared they need laser hair removal is 47%. However, that number increase to 84% when referring to waxing. Referring to payments we had two options to evaluate: 1- $49.99 per month for a one-year membership that provides with a total of 6 laser hair removal treatments and, 2.- An upfront payment for a total of 6 laser hair removal. The monthly price seems to be a viable pricing model because one-third of the interviewees are willing to pay the amount. The reasons of those who declared that didn't want to pay that amount were: Don't need the service. LHR is too expensive Bad experiences using LHR Also, when consulted about the most they are willing to pay monthly, the mean rounds $53 and, the range varies from $36 to $58. That shows 49.99 as a good middle point. Also when migrating from waxing to LHR, the interviewees expect to pay a maximum of $10 more on a monthly basis and $100 more upfront for the change. Amounts from $213 to $600 and a mean of $402 are commonplace for an upfront payment. The issue is that their better options on Groupon.com for EBRP. If Laser Lilly select a fixed price of $600 (sum of $49.99 x 12months) the mean is $200 behind and, Groupon offers are between $150-250 cheaper, making it hard to sell. This is coherent with how the people that have done LHR pay their treatments; 50% use a flexible payment option while 95% pay upfront for waxing. Difficulties of the study The main problem we faced was the budget we had; this made extremely difficult to gather the information we needed to give the requested insights. One perfect example of this was our survey: To conduct a precise study we needed to find some people who had used the service in the EBRP area and that are willing to answer our questionnaire. We approached some Market Research agencies, but the starting price was $5,000 for 250 interviews with college girls in Louisiana (this could probably increase because we were looking for a more specific target). Another way to get people to answer the survey was to find leads, but this also implied the use of money and, it didn’t guarantee (as they are cold leads) the responses. As Ching’s report stated: “… reach out to health/beauty influencers on the area and give them a survey regarding our pricing model as compared to the current pricing model in the market. He (Jorge) gave the website https://ninjaoutreach.com/ to try a test trial and see if we can get a free lead to send our survey. I tried to register to the trial version, unfortunately, credit card information is required”. Jorge's report also showed that a quantitative approach could be done using Facebook and Google forms. However, it also entails some costs: Estimated costs for a Facebook survey using Google Forms: This rate is calculated assuming a 10% conversion rate for every click. But the survey wasn’t the only issue. Jennifer reported on her research about market trends: “I have searched for market trend vendors rate and all of them do not state the rate in their websites. All requires a query form to fill out, which I have done [...] But given that the rate is not stated in the website, we can expect that these rates are skyrocketing”. This is not commented to discredit the project. The qualitative approach used combined with quantitative analysis of the survey can show a general map of what needs to be done to make this service a success. However, I recommend a Budget of $10,000 or more to get better results about customers and market trends. But as an almost-for-free Project, this study works just fine for what it is intended to answer. Conclusions and Recommendation Laser hair removal is cheaper than waxing on the long-term but, this is not how it is perceived. There is a niche for Laser Hair Removal because 77% of the female students interviewed declared they are keen to use the service. When migrating from waxing to LHR, the interviewees expect to pay a maximum of $10 more on a monthly basis and $100 more upfront for the change. Groupon prices overperform Laser Lilly’s monthly payments model. However, the $49.99/month payment plan is well received among the respondents and it is probably the best strategy to implement. Laser Lilly's sales staff should review very carefully the strategy for the upfront payment model because there are very cheap options in the market. Project Owner’s Analysis Evaluation vs. Objective Was the project successful in meeting its objectives? The objective is to assess the viability of Laser Lilly’s pricing model in terms of: How many college females are presently utilizing laser hair removal services? Out of the 32 respondents, 19% are presently using laser hair removal services and significantly 77% are very likely to use laser hair removal. How many college females would like to utilize laser hair removal services if the services were free? Considering that the 77% of the respondents are very likely to transition to LHR and they are all willing to pay $10 more as monthly payment and $100 more for the annual membership, and one of the strong reasons why they do not want to try LHR is the misconception of the high price of LHR, we can conclude that 100% would be willing to try LHR for free. How many college females will pay $49.99 per month to have a one-year membership that provides them with 6 laser hair removal treatments in East Baton Rouge Parish, Louisiana. 33.33% are willing to pay one-year membership that provides them with 6 laser hair removal treatments in EBRPL. The reasons of those who declared that did not want the amount are: they do not need it, they have bad experience with LHR, or simply the misconception that LHR is incredibly expensive. What is the most they would be willing to pay per month if the services we performed in connection with a one-year membership? (Raging from $0 to $150) What is the most they would be willing to pay as an upfront lump sum for 6 laser hair treatments as opposed to a one-year membership with monthly payments? (Ranging from $0 to $750) The most respondents are willing to pay per month for an LHR service is from $36 to $58. And the amount they are willing to pay as an upfront lump sum for LHR treatment is from $213 to $600. However, Groupon offers $150 to $250 cheaper than Laser Lilly's $599.88 Demographically (in terms of age, race, economic status, level of education, income level) of the above college females? What grade level are the above college females in? (Freshman, Sophomore, Junior, Senior, or Post-Graduate) The 32 survey respondents are 23 to 25 years old single college female, 47% are full-time employed, 47% have Bachelor's degree, 50% have an income of $51,000. The ones that have bachelor's degree may be studying for their 2nd degree. How much more would our target market be willing to pay to transition from waxing to LHR? When transitioning from waxing to LHR, the respondents were willing to pay a maximum of $10 more on monthly bases and $100 more on upfront lump sum amount for one-year service. What went well – and why? Smart People and Team Work With the right team in place, expert resources, active participation of all the stakeholders are a major factor that this project went so well. The commitment of everyone in the team was very evident in the quality of work put in and the enthusiasm displayed during the meetings. The eagerness of the stakeholders to help is also one a major factor that this team was so in-sync. The management team’s guidance and active participation in this project, especially Gray and Tatiana, is an important breakthrough that led to the success of this project. The individual expertise was unselfishly shared by everyone in the team that when pooled together played a beautiful aria like an orchestra. Effective Planning The project process implemented allowed for a reliable and realistic time-scale to be created. The RPM planning enabled us to have a crystal-clear picture of what we want, why we want it, and what we need to do. All the project stakeholders were actively on-board during the planning process. The comprehensive planning of collectively identifying our RPM blocks is one process that I believe solidified the planning stage that is vital in the success of this project. Another thing that lead to the success of the project is the daily team huddle and the pocket meetings that kept the team focused on track and aware of the progress of the project. Open Communication An open-flow communication is one vital factor that went perfectly well in this project. Stakeholders were well-informed of the progress of the project via huddle and updates stated Slack. Another major part that the communication system is successful in this project is everyone's adherence to the communication protocol that is in place, thus, respect was maintained. We were facing a stumble block due to the unavailability of information on lead generation, market trends, and competitors' market share but because everyone was encouraged and motivated to suggest solutions, a breakthrough ensued - Gray was tapped to help with the survey since he is living in EBRP as suggested by Ching. The constant communication of the Marketing Research Specialist, Jorge, with the team also played a vital role that everyone was kept abreast of what is going on. Indeed, listening to stakeholders and paying attention is a very important ingredient for success. What did not go well - and why? The inclusion of lead generation, market trend, competitors’ market share, in our research was not well-thought of thus the challenges we faced were not anticipated. It was so bold of us to put that in our RPM block that it led us to a stumble block when we realized that these are research topics that we cannot just pluck out of Google research as they entail enormous cost. The deadlines or time-frame set for each task was not done at the start of the project that led to a very slight hurdle. This was not discussed thoroughly in the huddle, as well. What would you do differently – and why? When identifying our RPM Blocks, all the action items must be well-thought of and taken into consideration the challenges that we will potentially experience when actually doing it. These possible challenges, all the angles, must be anticipated and contingency plans must be put in place and documented. Deadlines and time-frame for each action item must be discussed in the planning stage taking into consideration the over-all completion of the project. This is to prevent misunderstanding and argument on the matter. When the deadlines are in place, it must be strictly followed by all stakeholders. Conclusion Our survey states that 77% of the respondents are likely to transition from waxing to LHR and are willing to pay $10 more as monthly payment and $100 more for the annual membership. In addition, survey result states that our target market is willing to pay $10 more as monthly payment and $100 more for the annual membership. Comparatively with the existing LHR establishments with the package raging from $719.88 to $1,199.40, Laser Lilly’s annual cost of $599.88 is still competitive. Given this, we can therefore conclude that the pricing model of Laser Lilly - $49.99 per month for 12 months, meaning $599.88 per year inclusive of 6 sessions, with each session covering one body part (e.g. chest, legs, bikini area, etc.) at $99.98 per session, is indeed, viable. Recommendations The reasons that came out from the survey why people are reluctant to try LHR are they do not need LHR, it is expensive, and they have bad experience with LHR. My recommendation to still tap this part of the market because of the abovementioned misconceptions about LHR is to steal the market share of waxing by creating a need for it by coming up with a marketing campaign about the benefits of LHR and the long-term competitive cost vs. waxing. As some of the competitors in the market that offers discount via Groupon vouchers, we can also adopt this – offering introductory sale during launching to penetrate the market. To create a website and implement an SEO Marketing Strategy. Ideally, the businesses who have the best ability to deliver quality service have the most customers. But reality tells us that it is a popularity contest first before ability contest. At this age and time people depends on the internet search engines when they want to find out about a service. Online marketing is all about reminding people you exist and to stay in front of your target audience. References Alona’s work product Ching’s work product Jennifer’s work product Jorge’s work product Laraib’s work product Acknowledgements I would like to thank my teammates who have painstakingly did their best to produce quality research work and substantially reliable reports that have helped in reaching the objective of this project. I would also like to acknowledge and express my gratitude to Gray and Tatiana for their effort in conducting the survey. Their effort has saved the company project expenditures for lead generation and survey. We have successfully completed this project sans project overhead because of your impressive competence, relentless resourcefulness and love for your work. My heartfelt gratitude to all of you.