Sonite Products

At the beginning of the simulation, all rival firms market two Sonite brands. Sonite products have existed for several years and the market has grown quite consistently since the introduction of the first Sonite brand. It is now a well-established market, with several strong brands at different price points covering a wide range of needs. Analysts believe that the Sonite market will continue to grow over the next five years.

A Sonite is a complex piece of equipment made up of several components. Although they can be evaluated along more than fifty attributes, Sonite brands are primarily differentiated in terms of five physical characteristics that are considered as the most important ones by industry experts. These characteristics are described below, and additional details are given in Figure 1

•      Processing Power. This characteristic measures the speed of the internal processor. High processing power is critical for applications using extensive graphics or doing a lot of calculations. It also drives the ability of the Sonite product to process multiple tasks simultaneously. Processing power is given in gigaflops (billions of floating point operations per second), a standard and respected measure that takes several factors into account: number of “cores”, internal memory size, frequency, etc.

•      Display Size. This is the size of the screen, in inches. This characteristic drives the ability of the Sonite product to display higher quality images or videos, or to display more information to the user at a given time.

•      Design Index. This characteristic does not relate to the product esthetic but to the type of raw materials used (wood, plastic, metal ...), to the number of components (all-in-one type versus multiple-component type), to the aspect of its various components (position, size …). Therefore, a product rated 8 on the design scale is not better or easier-to-use than one rated 4 on the same scale.

•      Battery Life.  This is the number of hours during which the Sonite product can operate without being connected to the main power.

•      Features. This is the total number of features offered by the Sonite product. These features can be hardware related, such as the ability to connect various devices to your Sonite product, or software related.  There are a minimum number of core features that each Sonite product must offer. Additional ones are nice to have that may be of interest to some consumers.

It is important to understand that offering more of a certain characteristic is not necessarily better. For instance, high processing power processors may require a sophisticated cooling system that has an impact on weight, volume and noise. Consumers who do not need high power will certainly choose a less powerful Sonite that will be relatively small, light and quiet. Similarly, large screens may be highly attractive to some users, but not to others because of their higher weight and heavier power consumption. Similar advantages and drawbacks exist for most characteristics: long duration batteries are bulky and heavy; product with lots of features may be difficult to use and may confuse new or occasional users; etc.

The base cost is also an important factor; this is the cost at which each unit will be produced, based on an initial production batch of 100,000 units. The base cost is decided jointly by the Marketing department – which is mainly concerned with margin and profitability– and by the R&D department –which is mainly concerned with product feasibility.

Figure 1 – Sonite main physical characteristics