3. COMPANY BACKGROUND
Séraqua
CREATIVE
TILING
OVERVIEW
Specialized in custom-made and
pre-fabricated ceramic tile mosaics
Operate from Riga, Latvia from
Spring 2016.
Market relatively small but
potentially very profitable
Strong competition in the industry
Competitive advantage: new
robotic technology
Increase speed of production,
quality and productivity
Lower production costs and
proportion of defective products
KEY INFORMATION
4. COMPANY BACKGROUND
VISION
MISSION
CREATIVE TILING
To be the market leader for niche ceramic
tile offering within south America and
Baltic states
To deliver exclusive ceramic customized
products for upscale corporations and
individuals who value uniqueness, quality
and good design
Séraqua
5. COMPANY BACKGROUND
COMPANY GOALS
CREATIVE TILING
Financial strategic goalS
To be financially stable and profitable as a
business within the first 3 years of operation
To increase net profit by 5% annually
To reduce expenses by 5% annually
To achieve and maintain an outstanding customer
service with below 5% complaints rate
CUSTOMER SERVICE strategic goalS
Introduce customer database and data
management system to optimize operations,
reducing lag by 15% annually
Provide products and services globally and
to cover beyond 5 markets within 5 years
of operation
Séraqua
6. COMPANY BACKGROUND
Séraqua
COMPANY GOALS
CREATIVE TILING
OPERATIONAL strategic goalS
To increase efficiency of business by 15% annually
on key operation metrics
To increase quality through new robotic
technology and attach analytics metrics for
optimization within 12 months of operations
PRODUCT & MARKETING MANAGEMENT GOALS
To introduce and apply excellence standards for all
products and gained key industry certifications
within the first year of operations
To develop and implement a consistent promotional
plan and optimize the promotional mix for the
wealthy and upscale target markets and gained
niche market share in this market within the first 3
years of operation
7. SéraquaSéraqua
BRAND
Séraqua (Abstract & Descriptive)
CONSTRUCTION
VALUES
Prestige, Quality, Aesthetics, Customization,
Exclusivity & High Status
UniquelyAttractive
ELEMENTS
Spanish, Turkey & Italian association, clean, sleek, blue
tones denoting the brand value of fluidity and
customization of the brand; features a vector heart
shape with the construction of tile elements; signals
customisation of needs, diversity of needs and
different layers of consumer needs. *Protectable.
9. PESTLE ANALYSIS
POLITICAL
ECONOMIC
SOCIAL
TECHNOLOGICAL
LEGAL
ENVIRONMENTAL
Séraqua
• Challenged by widespread
corruption scandal involving
both the president and her key
ministers
• Current account stood at a deficit
of 3.88% of GDP in 2014, increasing
from 3.40% of GDP in 2013
• Fall in export earnings and lower
commodity prices also contributed
to the widening
• Political impasse over the
passing of important bills
• Total external debt stood at 15.0%
of GDP in 2013, up marginally from
14.1% in 2012,
• Total external debt was low
compared to most emerging
economies
• Approximately 23.75% of Brazil's
population is below 14 years of age
and around 7.56% is above 65
years of age
• Relatively young country, with a
median age of 30.7 years in 2014
• Proportion of people with
secondary education and tertiary
education has witnessed a sharp
rise during 2003-12.
• Mobile penetration stood at 138.19
per 100 people in 2014, with total
subscribers at 275.67 million
• Launched the BRL32.9 billion
($14.84 billion) Inova Empresa plan
to boost productivity –ICT,
agriculture and agribusiness,
energy, oil and gas, defense,
environmental sustainability, and
health
• Not performed well in product market
regulation
• Overall, Brazil is regulated to a greater extent
than Colombia, Peru, South Africa and Russia
• Country's pledge to check corruption under
the OECD's anti-bribery convention - law
imposes fines up to 20% of their turnover,
or BRL 60m ($27.07 million)
• Over 75% of Brazil's electricity comes from
hydropower, making the nation one of the
world's largest producers of hydroelectricity
• CO2 emissions rose to 489.9 million metric
tons in 2012, up from 475.4 in 2011
• Rising CO2 emission is likely to hamper the
country's efforts to reduce its carbon footprint
10. SWOT ANALYSIS
Séraqua
STRENGTHS WEAKNESSES
THREATSOPPORTUNITIES
• New technology
• Fast production
• Higher quality
• Cheaper customization and production costs
• Not daily product, has specific clients.
• Bigger marketing expenses
• High costs of technology
• Big costs of designing
• Expensive transportation
• Pixel-like structure of the final image, not very
clear lines
• Not very competitive market
• Business to business and business to
consumer
• Huge market
• Full customization
• Hard to reach target market
• Sensitive to economic downfalls
• Influenced by design trends *High
customization cost
• Non-possibility to demonstrate all designs in
full at the point of sale
• Narrow niche of the product
12. BARRIERS TO
ENTRY
Moderately High
• Reducing due to the development of high tech
products and greater ease of entry due to
reduced corporate bureaucracy
• Incumbents posed strong barriers – huge
variety of products and strong brand presence
both online and offline.
• Considerable startup costs – cost of high tech
equipment, building and raw materials
• Lack of relative economies of scale and
experience
• High switching costs for the consumers
13. PORTER’S FIVE
FORCES
SOUTH AMERICA’S Furniture and Floor coverings
Highly fragmented with a wide variety of
retailers, ranging from small independent retailers
to large chain-stores.
Compound annual growth rate (CAGR) of 6% in
recent years; this high growth may encourage new
entrants to the market and decrease competition.
14. PORTER’S FIVE
FORCES
SOUTH AMERICA’S Furniture and Floor coverings
NEW ENTRANTS1 THREAT OF
SUBSTITUTES
2
A lack of brand strength towards both retailers
and manufacturers means that it is relatively
easy for new players
Established diversified retailers, such as
supermarkets and department stores General
branding and the existing customer base of the
retailer drive sales.
Little government regulation, which tends to focus
mainly on health and safety issues regarding
materials and design.
MODERATELY STRONG
Go directly to manufacturers, where substantial
savings can be made, thus attracting buyers
Second-hand products posed another threat
Networks such as the freecycle network, with over
9 million members worldwide, are also valid
substitutes.
MODERATE
15. PORTER’S FIVE
FORCES
SOUTH AMERICA’S Furniture and Floor coverings
BUYER POWER3 SUPPLIER POWER4
Substantially lowered as individual consumers
have little financial muscle and their large
number means that retailers’ sales are hardly
affected by the loss of any individual consumer.
Buyers are more likely to shop around for the
best deal, with a focus on price and quality
rather than brand loyalty.
Experiencing reduced demand and therefore
harsh trading conditions.
Buyer power is further strengthened by
negligible switching costs
MODERATE
Expertise required, backward integration by retailers
into manufacturing is not common
Branding tends to be relatively unimportant to end-
consumers, who are generally more concerned with
the quality, price and design of the product.
Lack of brand strength restricts the ability of
manufacturers to dominate the market
STRONG
16. PORTER’S FIVE
FORCES
SOUTH AMERICA’S Furniture and Floor coverings
DEGREE OF RIVALRY5
Many players within the market are diversified
retailers, such as department stores or supermarkets,
which are not critically reliant upon furniture and
floor coverings sales, thus easing rivalry.
Such larger retailers benefit from scale economies that
enable them to negotiate better deals with suppliers
and therefore allow them to compete more heavily on
price
High degree of product diversity in this market eases
competition.
Exit barriers are relatively low
Rivalry is eased to a certain extent by good
market growth that allows players to
increase their revenues without
encroaching on other players’ market share
MODERATE
18. KEY LOCAL COMPETITOR
PORTOBELLOEngaged in the manufacture and supply of
ceramic and porcelain products.
Unglazed porcelain, glazed porcelain, floor, wall,
mosaic tiles and special pieces.
Supplementary services for construction works
material industry in and outside Brazil
Operates 16 production lines and exports its
products to 60 countries in Europe, Asia, North
America, Oceania, the Middle East and Africa
The company recorded revenues of BRL834
million (approximately $388.8 million) in the fiscal
year ended December 2013
1
2
3
4
5
Products
Unglazed tiles | Glazed
porcelain tiles | Floor tiles |
Wall tiles |Mosaic tiles
Séraqua
19. KEY LOCAL COMPETITOR
PORTOBELLO
Tradeshows & Catalogs
Digital marketing, New Media & Social Media
High tech products for market expansion
Use of sales force equipped with high technology
products and selling methods
PROMOTION METHODS
DISTRIBUTED IN
Portobello shop
Multi-brand resale
Engineering
1
2
3
4
1
2
3
Séraqua
21. THE CUSTOMERS
Séraqua
TARGET CUSTOMERS
B2C FINAL CONSUMERS
1
Rich, Wealthy, Famous
& The Powerful
B2B FINAL CONSUMERS
Business for the rich,
powerful, famous
customers such as
restaurants, spas, saunas,
beauty and cosmetics etc
B2B INTERMEDIARIES
Interior designing
houses, advertising and
media agencies and
event planning agencies
2 3
22. THE CUSTOMERS
Séraqua
TARGET CUSTOMERS
TARGET MARKET OBJECTIVES
To gain 0.53% market share for mosaic tiles (Séraqua) within Brazil by 2018
Increase the number of people who make a purchase while browsing our online
store by 20%
Increase company sales by 20% by 2018
Increase the percentage of customers who rate service as "excellent" from 80% to
85% within 18 months
23. BRAND POSITIONING
UNIQUE/KEY VALUE PROPOSITION
Séraqua
Cheaper and faster customization
POSITIONED AS
Premium product for a premium price
Promoted as a niche product with selective distribution to
increase the exclusiveness
Symbolic positioning- object of ego identification and self-
image enhancement
1
2
3
24. BRANDING STRATEGIES Séraqua
Create key associations with other luxury products such as cars,
condominiums, mansions, high fashion and certain celebrities.
CO- BRANDING
Feature products in trade shows, furniture expos, celebrity
talkshows set and demo showcases
CELEBRITY ENDORSEMENTCelebrity-designed tiles up for auction and at the same time
showcase the unique customisation feature
CORPORATE SOCIAL RESPONSIBILITY
Use of Brazil’s sports celebrities in soccer
Use high profile celebrities for charity auctions to increase the brand’s
profile and gain brand positivity
26. PRODUCT
P1. Large custom mosaics
P2. Small custom mosaics
P3. Large pre-designed mosaics
P4. Small pre-designed and pre-manufactured mosaic
UNIQUE VALUE PROPOSITIONS
Higher Quality
Cheaper Customisation & Production Costs
Full Customisation
Universal Use
EXTRA PRODUCTS
Light System & Special Lamps That Highlights
Mosaic Pattern And Complements It
1
2
3
4
28. $40/sf for 1" sintered glass to $100/sf for
3/8" Vitreous Glass, plus $50/sf for
panelization for backlighting
PRICE
Premium pricing strategy
Skimming pricing strategy
B2C
Promotional discount
29. $40/sf for 1" sintered glass to $100/sf for
3/8" Vitreous Glass, plus $50/sf for
panelization for backlighting
PRICE
Premium pricing strategy
Skimming pricing strategy
B2B
Quantity discount
Cumulative quantity discount
30. $40/sf for 1" sintered glass to $100/sf for
3/8" Vitreous Glass, plus $50/sf for
panelization for backlighting
PRICE
Premium pricing strategy
Skimming pricing strategy
B2B (INTERMEDIARIES)
Cash discount
Trade discount
32. PLACE
exclusive and selective form of distribution
Will rely on only a few intermediaries for exclusive distribution
Set up on own stores in several of the major city center such as Brasilia
and Sao Paolo for selective distribution in these channels for brand
building and to keep the exclusivity of the brand
CONSIDERED COMPANIES
Fernanda Marques Architects
Studio Arthur Casas
João Mansur Architecture Design Art
1
2
3
34. CONTENT STRATEGY
Ideas of prestige, power, status
PROMOTION
Advertise in conjunction sports celebrities and powerful business
figures or business figures, with personal planes, high-end
automobiles and high-end designer houses
Key influencers in art, media and entertainment
Feature customisation and celebrate individuality messages.
1
2
3
4
35. PROMOTIONAL APPROACHES
PROMOTION
State of the Art Showcase Room-Séraqua
Television Commercials
Interactive Digital Site
In-store Ipad Visualisers
Expo & Tradeshows Exclusive Lucky Draws
Loyalty Reward Programs/ Referral Membership Program
Sales Force Motivation – Commission And Monthly Recognition
Public Relations Media Stunt/ Sponsorship Programs (For Artists/ Exhibition)
Email Marketing/ SEO/ Google Display
1
2
3
4
5
6
7
8
9
36. AFTER SALES & SERVICE PROCESSES
PROMOTION
Showrooms And Sales Force
State Of The Art Decoration
Catalogues In Digital Formats And Visualization
Early Bird Promotion And Free Delivery
INSTALLATION , WARRANTY AND AFTER SALES
7 Years Warranty1
1
2
3
4
38. THE FINANCES
Total Operating Costs for Year 1: 6,148,000
Total Operating Costs for Year 2:6,,332,440
Total Operating Costs for Year 2: 6,522,413
EXPECTED COSTS
Total Revenue for Year 1: 13,960,000
Total Revenue for Year 2:14, 310, 000
Total Revenue for Year 2: 14, 670,000
EXPECTED REVENUE
***Based on our three- year financial projection, we will be increasing our
profit from $7,812,000 in 2016 to $8,147,587 in 2018, with a ROI of 30%
in Y1, 30% in Y2 and 20% in Y3..
41. TIMELINE – ENTRY YEAR
TRADE SHOWS AND EXPOS
TVC
In Store SALES FORCE WITH IPADS VISUALIZERS
CELEB ENDORSEMENT/ PR STUNT
REFERRAL PROGRAMS
Web Banners
Google Display Ads / SEO
Period 1 2 3 4
EMAIL MARKETING/ DIRECT SALES
INTERACTIVE WEBSITE
SALES FORCE MOTIVATION REWARDS
