Your Global Sourcing Solution – Case Study
To illustrate how sourcing specialists at SF Global Sourcing collaborate with clients to create higher perceived value with the lowest cost of goods (COGS) possible, we turn to the case of Maxxus Marketing, llc and it’s product You Can Cook™.
You Can Cook™ was developed by Maxxus’ President Shawn Alikian to help everyday people master the ability to cook restaurant quality meals at home. Alikian recognized that, while professional cooking shows are wildly popular in primetime television, most people don’t possess the skills necessary to cook like a chef. To bring the program to market, Alikian worked closely with DRTV experts RW Advertising and owner Ryan Woods to help him evolve a compelling product offering and produce a wining infomercial. Woods enlisted trusted partner SF Global Sourcing, whom he had done previous programs with, to help them build the ideal offer.
One of the challenges of DRTV programs is that they require a COGS whereby the retail price to the consumer is 4 or 5 to 1. In other words, if something is sold for a dollar, its base cost must be .20 to .25¢. One of the main reasons is the cost of media airtime, which can be very expensive.
The Maxxus and RW Advertising team worked in tandem with our sourcing specialists to develop a customized, global sourcing solution that would give consumers a tremendous value, while keeping wholesale costs of the product manageable. The original offer configuration Maxxus had in mind would have retailed for $200 to $300, a figure that the team of marketers felt would be prohibitive to many consumers. After brainstorming many possible offer components via a series of back and forth meetings, SF Global Sourcing sourced samples and costs for a variety of possible offer components that ranged from knives, to kitchen gadgets to a hardbound cookbook and a host of others possibilities.
Through these collaborative working sessions, the team worked together to evolve a product offer that would give consumers great value and a rich experience, while keeping the wholesale costs and resulting retail price within the range of most consumers. The final offer arrived at consists of:
The result is a well-rounded offer configuration that retails for $99. All of the components of the offer are designed to welcome the consumer into the marketer’s community, with elements they can use on a daily basis that have consistent branding intended to engender brand affinity and good feelings. Based upon his delight with the way the Maxxus and SF Global Sourcing team pulled together, Alikian is bringing additional opportunities to the table. This case study is a sound illustration of how SF Global Sourcing collaborates with its customers to help identify and source products that will help enhance an offer and close more sales.