Value Creation and Positioning
Attractive segments
Based on our extensive research, we are certain that the most attractive target segments are the high end income customers, both the younger generation for the B&O Play product line, and high income families and individuals for the traditional B&O product line. B&O targets their Play products to young professionals from 20-35 years old, while the traditional B&O products are targeted to people from 35 years old and above with an income exceeding 1 million RMB a year.
In China, there are certain needs for audiovisual products. Based on our survey, we found that 86% of audiovisual product users highly value design as a part of their purchase decision. Design is a key element for B&O products, therefore there is an opportunity to establish B&O in the Chinese market.
Through our research, we found out the biggest obstacle of B&O in the Chinese market is its low brand awareness. If we only focus on the traditional B&O product line, it is challenging to increase brand awareness in China because of its narrow target market. Therefore, we have decided to focus on both B&O and B&O PLAY products. We believe that by focusing on these two product lines, we will be able to reach a wider audience in the Chinese audiovisual market.
Positioning
For the traditional B&O product line, we will maintain the high-quality luxury brand image. However, in order to expand our brand awareness, we will use the B&O PLAY product line to gain more exposure in the market. B&O PLAY offers less expensive, still high-end products that are aimed towards a wealthy, younger generation. To further position the brand against its main competitors, it is critical to innovate and find new ways to exceed the customer expectations.
New Offering
The concerts will be adapted to the exclusivity of what B&O is known for, so the concerts will be held in a medium sized venue and will be kept to a restricted guest list.
Concerts will be held in both outdoor (parks) and indoor and will invite artists with powerful voices (great for acoustic sessions). Artists will have a contract with B&O to use the products during the concert, but also during the year when they appear publicly in China. B&O LIVE will be hosted six times a year, three for the B&O PLAY segment and three for the traditional segment. This makes sense as full-time staff can be in charge of this new offering, it is a full income stream but the offering maintains its exclusivity.
Our proposal is that B&O launches a new offering with music concerts, called B&O LIVE. These concerts will be linked to both their existing target segments and product line (Bang & Olufsen and B&O PLAY). We think this new brand offering is very suitable to the Chinese market and will increase B&O’s brand awareness. Also, this can be seen as a type of promotion while earning money. We believe this offering is better than for instance a mass media campaign like a tv commercial because the concerts appeal to the two specific target groups.
We identified that the biggest issue for B&O in the Chinese market is a lack of brand awareness (only 19% of our respondents knew B&O). In order to increase that brand awareness, we came up with a relaunch strategy that focuses on a new offering adapted to the Chinese market and a promotional campaign around it.
B&O LIVE Classic Concert
The concert will take place in an exclusive location (for instance Xintiandi), and will focus on B&O’s ideal: ”move you with enduring magical experiences". The B&O LIVE offering will be divided into two types of concerts, one for the B&O PLAY target group and one for the traditional B&O target group. The concert aiming for the B&O traditional target group will tend towards classical vocal musicians like Paul McCartney. The B&O traditional customer is less reachable through mass communication channels. One of the leisure activities they enjoy is going to classical music concerts. B&O LIVE for this target segment will be held in prestigious concert venues. These are high-end and upscale events. For the younger segment, Chinese artists such as Wang Leehom and western bands such as the XX are famous and popular and have great vocals. We chose artists with a great voice in order to support the idea that B&O’s product have a great audio quality. B&O LIVE will be a great way to increase the brand awareness for B&O.
