Selection of target market
Eliza Minden should pick the dance students as her target market. This is because the number of dance students greatly outnumbers the professional dancers and thereby presents a vast market for Gaynor Minden shoes. Dance students usually took their lessons for about a year. During this period, they are mostly taught by the same teacher. Ballet teachers were either professional ballet dancers to advanced students (case study). This means that while Gaynor Minden targets dance students, they also gain access to the professional dancers market. In the course of teaching, the professional dancers get actively involved in the issues about shoes their students wear. In the course of time they are able to determine the best shoes for dancing and in case Gaynor Minden had targeted the dance students market, the company stands a chance of winning customers across the entire dancing spectra.
In addition targeting dace students assures Gaynor Minden of client loyalty as the dancers become professionals. Once students start using a certain type of shoe in training they are likely to carry on using that shoe and therefore assuring the supplier company of continued market. The shoes have been proven to reduce injuries among dace trainees and this is a big advantage to Gaynor Minden as the students are likely to remain loyal to that particular brand regardless of slight changes in its pricing.
Valuable Features of the new pointe shoes
The features of the new pointe shoes that the target market will find most valuable are the injury-preventative design of the shoes and the extra support they offer dancers when they are rising to pointe position. 80% of professional dancers dance with ankle or foot injuries with ballerinas being the most susceptible (case study). The worry over certain types of dance shoes causing injuries to trainee dancers is very high and usually ranks first among considerations made by parents when they are purchasing any type of dance shoes for their children. This is especially so for first time dancers. Assurance over safety is likely to win over many customers who become brand loyalists.
The second feature is unique as it enhances that typical aspect of ballet dancing- rising to pointe position! It is therefore a valuable feature that is bound to win over the hearts of many young ballet dancers. With the assurance of minimal injuries ballet dancers can out rightly feel free at ease to rise to pointe and therefore perfect other dancing moves at ease.
There are several pricing concepts to be considered when setting the price for the Gaynor Minden shoes. Some of these are the Return on Investment (ROI) - net profits after deduction of taxes divided by the total assets, elasticity of demand- or the consumers’ responsiveness to price changes and the third concept is fixed and variable costs. The Gaynor Minden shoes require a pricing that helps recoup the investment on manufacturing equipment (ROI). Ballet dancers are likely to be sensitive to the pricing and therefore fair pricing as per the market conditions is preferable.
The pricing of the Gaynor Minden shoes should also consider the fixed and variable costs of production overhead costs, materials, labor, packaging (variable costs) and equipment purchase (fixed).
The total sum for the cost of production per pair of shoe
=cost of Labor + cost of materials + cost of packaging + overhead cost per shoe
= $37 + $27 + 130000/80000
The highest selling pointe shoes (Suffolk Ensemble) currently in the market, retail as $96.90 per pair while the lowest retailing shoes (Bloch Balance European) cost $59.46. Most of the other shoes in the market retail above $77 (case study). Since the Gaynor Minden shoes are of proven superior quality in terms f reducing injury and enhancing pointe dancing, they should retail at a relatively high price. The price should also be accommodative since the shoe brand is entering the market. Eliza Minden, the proprietor should target to acquire small profit margins but sell large volumes of shoes since her target market (dance students) is large.
Putting these factors into consideration the shoe can comfortably retail at $95 per pair.