Omega Paw Case Study

OMEGA PAW CASE STUDY

Identification

Problem

Omega Paw owner, Michael Ebert wants to quickly grow his business. To achieve this goal, he is looking for new marketing initiatives and exploring different channels of distribution. The problem is that “cat litter box” market is highly competitive, so he needs to find an alternative that will help to achieve his ambitious sales objectives.

Objectives/Background

Michael Ebert invented the self - cleaning litter box after caring for cats while his family members were away on vacation. Consequently, he started a company named Omega Paw that distributed his creation and other pet care products all across North America. By September 2011, Omega Paw sold 50,000 of self cleaning boxes and made $1 million in sales.

Michael wants to continue this favourable sale trend and hopes to achieve $1.7 million by December 2012, $3 million by December 2013, $5.7 million by December 2014.

Evaluate and Assess

SWOT Analysis

Strengths

• Capacity to service a larger market (3,500 units per week)
• Impressive level of sales after being in the business for just over a year
• Unique product design

Weaknesses

• Very new company and is in early stages of development, management might not have enough competence to accommodate targeted growth.
• Issues with production in the very beginning
• Small marketing budget

Opportunities

• Competitively priced
• There is an expectation that they will be more cat owners

Threats

• There are minimal barriers to entry. Almost anyone can start producing and selling cat litter boxes as long as they appeal to the market.
• No patent on the design of the litter box
• Highly competitive industry

Market Analysis

North America has approximately 84.2 million cats. The population of cats has risen by 7% in 2012 from 2010 and is expected to grow at an annual rate of 3.6% for the next two years.

Customer Analysis

Omega Paw divided its customers into three distinctive categories. There categories where determined based on experience and knowledge.

• Existing cat owners – 80%

These customers had experience caring for their cat, so they would have all the required supplies. They would probably purchase additional or replacement items when needed. Usually they would buy them at different locations such as grocery or household supplies store, pet stores and veterinarian’s clinic.

• Gray zone – 15%

Most of these customers lived in the country, so their cats lived outside and did not require cat care products except for food.

• New pet owners – 5%

These were the first time cat owners, so they required all the necessary tools to care for their pets. Usually they did a lot of research and wanted to buy good quality products through a local pet store or veterinarian clinic.