OPTICAL

DISTORTION
INC (A)

Context
ODI has an idea to reduce vision of poultry chicken
to obtain its good behavior by making a contact lens
for it
ODI has transformed that Idea to Product and
tested it technically on a number of farms in
California and Oregon
This case is about transform that product idea into
a product concept and launch as a brand with a
marketing strategy
ODI targets introduction at least by spring 1975 and
achieve national distribution by the end of 1977

Debeaking Vs. ODI lens

Debeaking
Needs high precision
Limited time window
Traumatizes chicken
Reduces productivity of chicken
for a week

Product Concept
Revolutionary Technology
Who Poultry Farmers
Benefits Easy to use, cuts recuperating time and
decreases costs
When- At purchase of Starter Pullets

If we pull this off , We would have

revolutionized the business of Animal
behaviour
Ronald Olson, Vice President Marketing

Segmentation (Size of
Farms)
3 types of Farms in U.S.A.
Small Sized Farms (less than 10000 chickens)
Medium Sized Farms (10000 -50000 chickens)
Large Sized Farms (more than 50000 chickens)
ODI Should target Medium sized and Large sized farms with
main focus on farms with more than 50000 chickens
Higher profitability
A sales person covers 80 farms irrespective of the size of
the farm

Declining number of Small sized Farms

Number of small sized farms are reducing at a rate of 25 %
per year

Segmentation
(Geography)
South Atlantic Region has around 29 % of the total
chickens
California accounts for about 16 % of the total
chickens
ODI should launch the product via a region by
region rollout starting from California
California is a large market with around 40
million chickens
Southern California has large farms (more than
50000
chickens)
Two
Counties
in South California

contained 20 farms that housed 21

million chickens

Segmentation
(Geography) Contd..

ODI should enter Georgia and South Carolina

after California

North Carolina, California and Georgia

account for 25 % of the total chickens in
USA

Farmers Savings Calculation

Farmer's savings
per 20000 birds

156lb/day

56940lb/yr

$ savings on feed per 20k birds

4014.78

per hen-year savings in $

0.20075

per dozen egg savings in cents

0.9125 1 cent approx

9%-4.5% would save 50%

cost(in $ per hen) from pecking

0.1

per dozen egg savings in cents

0.454545455

Total per dozen savings in cents 1.5 approz

savings/dozen

1.5 increase by 50%

egg dozens/hen-year
savings/hen-year
potential of a 20000 farm
savings/year

22
33cents
660000
6600

Price
The Company should price the product in the range of 1215 cents per pair
ODI should target maximum early contribution
The estimated benefits for the farmers is around 33
cents ,thus savings of 18-21 cents will be passed to
farmers
It may be difficult to convince the farmers of the higher
benefits, thus higher price may reduce sales
Chicken farmers may react unfavourably if we increase
the price in the later stages
Market Skimming Pricing should be used as the
objective is to maximize early contribution

Promotion
ODI should use personal selling involving specialized
technicians
Personal Selling may also influence the Opinion Leaders which
would result in early adoption of the product
In subsequent years, ODI plans to advertise the product in 8
leading poultry industry publications
ODI also plans to participate in important industry trade shows
which may also generate new product ideas for the future
Selling points:
Substantial increase in Savings
There is no productivity decrease due to traumatization of
chicken

Additional
Recommendations
This is a completely new technology. So, to push to
customers
from
interest
to
trial,
we
recommend Free Samples to customers with
very large farms
In the long run, providing labor training service of
insertion of lens for a fee. It would be a win-win
situation for both ODI and the farmers

Profit Analysis
Cost/Box
Projected Sales
Boxes
Revenues

30
20000000
80000
2400000

100

184000

7.666666667

28000

1.166666667

Advertising

100000

4.166666667

sales staff 7

280000

11.66666667

technical person

70000

2.916666667

injection moulds

24000

glass

640000

26.66666667

costs

1326000

55.25

profit margin

1074000

44.75

Office cost
Depreciation of Patent

THANK YOU