Drypers_Corporation

SYNOPSIS: DRYPERS CORPORATION Drypers Corporation is a producer and marketer of premium-quality, value-priced disposable baby diapers and training pants both in the United States and on an international level. The company has been experiencing positive sales growth and profits over the past few years due to numerous innovations and is now the third largest marketer of brand-name disposable diapers in the nation. Due to the intense competition from companies such as Procter & Gamble and Kimberly-Clark, marketing and advertising are not only competitive tools but business practices that are essential to survive in the industry. Drypers has previously focused marketing efforts on print advertisements and promotions, but are currently considering investing $10 million of the advertising budget on a series of television advertisements to run during the first six months of the 1998 fiscal year in order to help meet short and long term sales goals and to reach brand-building expectations. Along with this extensive advertising campaign, the business plan for 1998 includes six different aspects. They can continue product innovation to differentiate the Drypers brand, offer “everyday value” branded products to consumers, continue to pursue international expansion opportunities, expand product lines to include additional consumer products, provide higher margin products for retailers, or increase brand awareness and retail penetration. SITUATION ANALYSIS Analysis of Drypers Corporation’s Internal Environment: Management at Drypers Corporation is focused mainly on using product innovation to compete with other premium-quality producers. They have made significant strides in rolling out diapers that have different features than the competitor, such as baking soda to address odor and aloe vera as a skin-smoothing treatment. They understand that they may not have the ability to spend as much money as the competitor so they work towards better ideas and launching new features first. Management is also focused on keeping a low overhead structure in tact in order to be able to sell their products at lower prices and still maintain a profit. The company leases manufacturing, distribution, and administrative space in nine locations in the US, Brazil, Puerto Rico, Argentina, and Mexico. This cuts down on building, personnel and distribution expenses. With Drypers Corporation operating in its strongest year ever in terms of sales and profitability, senior executives proposed an ambitious business plan for 1998. The business plan focused on six key elements: 1 - Continue product innovation to differentiate the Drypers brand. Drypers Corporation has achieved success in the diaper industry with meaningful product differentiation. The business plan continues this focus with the scheduled introduction of Drypers Supreme with Germ Guard Liner, the only diaper in the industry with antibacterial treatment. 2 - Offer “Everyday Value” branded products to consumers. The business plan reaffirms Drypers value position of premium-quality, value priced diapers and training pants and supports efforts for continuous improvement to offer consumers the recognition and reliability of a quality featured, national brand diaper at a lower price. 3 - Continue to pursue international expansion opportunities. Dypers Corporation will continue to expand its operations in Argentina, Mexico and Brazil and seek further expansion opportunities through acquisition, joint venture, or other arrangements in the Pacific Rim and Latin Americas. 4 - Expand product lines to include additional consumer products. Drypers Corporation will research to find additional high-quality consumer products that can be sold primarily through grocery stores, drugstores, and mass merchants. An example of this is the option to purchase NewLund Laboratories, Inc, a start-up company with breakthrough laundry detergent technology that provides detergent, fabric softener, and static control products in a single sheet form. 5 - Provide higher-margin products for retailers. Drypers Corporation will continue to sell its products to retailers at lower prices than leading premium-based brands so that retailers can then offer a lower price to consumers. Drypers will do this by delivering innovative product features that differentiate its products; producing high-quality products at the same cost as the leading national brand producers; spending significantly less on promotion, research and development expenditures than other producers; and maintaining its low corporate overhead structure. 6 - Increase brand awareness. With its recent consolidation of its larges three US brands into one recognizable name, the launching of a national television campaign is the next logical step to increase name recognition of the Drypers name. Analysis of Drypers Corporation’s Customer Environment: The main users of disposable diapers and training pants are infants and children, primarily below age four, and the purchasers are their mothers, primarily between the ages of 18 and 49, who decide the brand of the diapers and training pants. On average, one baby represents about $1,012.50 in retail sales, under the assumption that one baby uses five diapers per day for 30 months and average retail price is in the range from 18 to 27 cents per diaper. In recent years, the number of infants under 30 months of age is decreasing, which bring the modest growth of the disposable diaper market. Three aspects that consumers consider most when buying diapers and training pants are: quality, price and specialty. Because the products are used for babies, mothers will choose the products those are safe for babies’ skin. That’s why Kimberly-Clark and Procter & Gamble captured 78.9% of total U.S. retail dollar sales of disposable diapers and training pants. They spent around 70 million dollars a year in media advertising, which increased their brand awareness and as a result gained consumers’ trust. Therefore, if Drypers wants to capture more market shares, it is necessary to do the investment in national television campaign to build brand awareness. Drypers has advantages on price and specialty. It delivers on its value proposition with retail prices that are often 40% lower than premium-priced brands for comparable items. Once consumers understand that Drypers’ diapers are equal to the other national brand-and offered at a better price, it will earn more market shares. Drypers also demonstrated an ability to shift the ground rules in diaper marketing through product innovation. It was the first to introduce diapers that focused on skin care, diaper fit, absorbency and leakage control, and it is on the step to be the first to introduce diapers with antibacterial treatment. The product differentiation would surely capture customers’ interest. Analysis of Drypers Corporation’s External Environment: Competition In the disposable diaper and training pants industry, competition is generally separated into three areas: premium-priced branded manufacturers, value-priced branded manufacturers and private-label manufacturers. Premium-priced brand manufacturers use the strategy of consistently pricing their products near to the higher end of the price range in order to attract customers that are more “status conscious”. Some examples of these include Kimberly-Clark and their “Huggies” brand, as well as Procter & Gamble’s “Pampers” brand, both which are direct competitors to Drypers. Both of these companies compete in the industry based on promoting the quality, benefits/features as well as prices of their products. Each of these companies invests heavily in research and development efforts and toward marketing and advertising campaigns. Kimberly-Clark pioneered the first premium training pants and has used this advantage to gain 77% of the training pants market in the United States. In 1997 alone, Kimberly-Clark spent a total of $75.6 million on advertising efforts, over two times as much as Drypers has budgeted for advertising. $18.5 million of this was focused on print advertisements, and $57.2 million on television. Procter & Gamble’s advertising expenditures totaled $69.6 million in 1997; also over twice the amount budgeted for Drypers, with $16.8 million in print and $52.8 in television advertising. Both of these companies have an enormous competitive advantage in the area of advertising, considering the amount allocated toward the efforts as well as the fact that Drypers has yet to incorporate television into their marketing mix. Kimberly-Clark and Procter & Gamble, together, make up 78.9 %, or over ¾, of the nations retail dollar sales of disposable diapers and training pants. Kimberly-Clark controls 41.2% of the market (up 3.6% from 1994) while P&G holds 37.7% market share (has remained relatively steady but is up .03% from 1994). These companies distribute to stores that account for over 90% of U.S. diaper and training pants sales and have a relatively even mix of grocery stores to mass merchandisers and drugstores. All of these aspects add to the intense competition of the industry. Value-priced brand manufacturers’ strategy is almost the opposite. These firms focus on the value of the product, its low price, and the most you can get for your dollar. Emphasis is on affordability. Drypers Corporation falls into this category. These types of manufacturers often invest little in research and development and national advertising. Focus is directed toward promotions and coupons, which is why emphasis is on low-pricing. This sets these companies behind others on the competitive scale because their brands awareness levels are much lower. Private-label manufacturers market their products under retailer-affiliated labels. They are often positioned as lower cost alternatives to national brands. Thus, affordable price is emphasized over quality and features. These manufacturers rely on the retailers to promote the brands, therefore saving time and money. However, these brands are often seen as “generic” and awareness is very low. Private labels accounted for 23.2$ of unit sales and 16.1% of dollar sales in 1997. The majority of these brand were sold through drugstores although distribution was relatively even throughout all three outlets. Economic Strength and Stability Economic strength and stability has had numerous effects on Drypers Corporation’s business functions. In 1997, U.S. domestic demand grew by 4%, and against previous speculation, consumer spending did not go down. Long-term interest rates and inflation dropped and unemployment rate was at approximately 5 percent. Dollar sales of disposable diapers and training pants has been on a continuous rise, however, due to the trend in fewer infants under 30 months old and improvements/innovation in diaper construction, this has lowered the average diaper use per child and the industry has only seen modest growth. In 1997, retail dollar value for the U.S. diaper market was at $3.93 billion, about a 2% increase from 1996, and the retail dollar value for training pants in the United States was recorded at $595 million, a 10% increase over 1996. The devaluation of the Mexican peso in 1994 as well as economic uncertainty in Brazil had previous impacts on the industry but have since been overcome. An upward trend in common stock price for 1997 also emphasizes economic stability. Low cost for 4th quarter 1997 was at $5.13 as compared to $3.50 in 1996, a 47% increase, where as high cost was recorder at $9.00 as opposed to $5.63 in 1996, a 60% increase! Socio-cultural Trends Socio-cultural trends can be defined as “culturally specific tendencies which modify the value system, the moral, the ways of thinking and behaving”. There are many arising trends in the mid-to-late 90’s that would have an effect on the diaper industry. One trend is the decreasing number of children under the 30 month age range, or those children still needing diapers. Another trend is that it is becoming more common for women to be in the workforce or to have stay-at-home/hands on or single fathers. Thus, focusing marketing efforts on the male population may become necessary. Also, lifestyles are becoming increasingly fast-pace and active, leading toward the need for increased durability, absorbency and compactibilty for those with little time for diaper changing as well for the need of waterproof, flexible and night-time products (for the various activities in a child’s life). Environmental issues are also becoming more of a concern, so “earth friendly” or “green” diapers will be in demand. Or, biodegradable diapers made out of recyclable materials. All of the trends help to forecast demand and pressure product innovation. Political Trends Many people are turning towards more environmentally sustainable products and practices. This is a trend seen in several different industries including the diaper industry. Several parents worry about the environmental impacts of the type of diaper purchased. Research has discovered that the environmental impact of cloth diapers is comparable to the impact of disposable diapers (Drypers products). Disposable diapers consume more raw materials and produce more solid waste where as cloth diapers consume more water and energy (fuel) to produce a single-use diaper. Drypers could offer an additional product of a cloth diaper to appeal to other consumer demands. Legal and Regulatory Issues Drypers Corporation has a licensing agreement to use Sesame Street trademark and characters on their products, packaging, and advertising materials. A licensing agreement gives Drypers Corporation permission to use their trademark and characters legally. It is a legal agreement between Drypers Corporation and Sesame Street. It is viewed as a validation of the company’s innovation efforts. They are marketing towards children’s interests and product satisfaction to gain in overall product quality and sales. Technological Advancements Drypers remains competitive on ideas and quickness. They were the first to introduce diapers that focused on skin care, diaper fit, absorbency, and leakage control. These advances have increased their product quality. SWOT ANALYSIS As a producer and marketer of premium-quality, value-priced disposable diapers and training pants, Drypers Corporation has numerous strengths that it can build on to increase its competitive edge. The most prominent strength of the firm would be its success in the area of research and development. Drypers has remained in the rankings due to its innovative products that set it apart from the competition. Drypers has also received various awards for its outstanding and unique product features. Another very meaningful strength of the company is its financial state. After experiencing a major setback in 1995, Drypers was able to learn from past mistakes and overcome these obstacles and they have been experiencing sales and profit growth for the past two years, even with their prices set approximately 40% lower than comparable products. Other strengths of the firm include its multinational distribution and sales as well as the in-house management team who coordinates product sales. As with any company in such a competitive industry, there are bound to be weaknesses. A major weakness that is surely affecting sales is the fact that Drypers is not yet a household name, at least when comparing the brand to Huggies or Pampers. Many consumers pick the brand of choice before picking the point of purchase, so in many minds, Drypers is not an option before entering the store. Also, Drypers product line does not really expand beyond diaper products. Drypers could offer products such as diaper bags, diaper rash cream, waterproof covers, baby powders, etc. Other weaknesses include random, uncontrollable profit loss due to extraordinary/special items, as well as the high amount of capital invested in R&D my competitive companies. In the diapers industry, the window of opportunity for Drypers is wide open. Their licensing agreement with Sesame Street allows the company to feature characters on their product, and could possibly allow for promotion and advertising collaboration during the airing of the television show. The firm can also use their current customer base and positive reputation and tie it to the bond a mother feels with her child and use this as a supporting feature along with the sales of their diapers. Drypers also has a very large advertising/marketing budget of which they use very little. They have the opportunity to utilize these funds and expand advertisements in order to capture a larger portion of the market. Finally, Drypers is not without the occasional threat. Competition is possibly the biggest threat that the company is faced with. Kimberly-Clark and Procter & Gamble hold ¾ of the dollar sales for disposable diapers and training pants in the industry. Not to mention these firms premium-quality, extensive product line, household brand awareness and increased R&D efforts. Another threat comes from the company’s lack of experience outside of the grocery store distribution sector. More and more consumers are buying outside of grocery stores than ever now! SWOT MATRIX FOR DRYPERS CORPORATION Internal Factors | Strengths | Weaknesses | Management | - In house managers coordinate brokerage companies that facilitate distribution of production which helped expedited the firms entry into the grocery store sector-Have favorable long term relationships with consumers-Effective management team | - No dedicated sales force in the United States- Do not engage in national advertising campaigns | Offerings | -Premium-quality, value-priced disposable diapers and training pants-Offer product samples to physicians- Always developing new and innovative products- Possible new laundry detergent line- Cleansing wipes- Offer distributers a large profit margin | - The Drypers brand is not yet a household name like Pampers or Huggies- Product line does not expand much from diapers and training pants | Marketing | - Print advertisements in Parenting Magazines- Offer coupons in daily newspapers and FSIs in the Sunday newspaper- Direct mailings-In-store promotions- Sampling-$30 million budgeted for marketing and advertising expenditures | - Only about 10% of the budget was spent on advertisements and branding in 1997- Not televised advertising in its 10 year history- $10 million expenditure represented a 33 percent increase in advertising and promotion budget- Lack of national brand name recognition | Distribution | -Sold in 28 different countries- Facilitated by in-house managers which has minimized overhead costs- Through selected mass merchant and drugstore chains, including Super Kmart stores , Meijer, and Caldor-3.1% of market share | - Very little experience outside of grocery store distribution- Less extensive national production and distribution capabilities necessary to supply large mass merchant and drugstore chains | Finance | - Retail price is 40% below those of similar products- Stock prices/purchases are on the rise- Consistently experiencing annual sales growth- Working capital at $48.7 million at the end of 1997- EBITDA at $28.8 million in 1997- Each baby represents about $1,012.50 in retail sales | - Unusual expenses were recorded in the past-1995 saw fluctuating sales and profit loss- 2.7% of annual sales were lost as a result of an extraordinary item in 1997 | R&D | - Have won numerous awards for product innovation including diaper featuring Aloe Vera- Always developing new product features | - Competitors spend increasing amounts of capital on Research and Development annually | External Factors | Opportunities | Threats | Consumer/Social | - Strong customer base-Appeal to their customers through promotions and everyday value | - Exposed to increasing amounts of advertisements from competitors- More are buying in drugstores or through mass merchandisers-Often pick the brand before the store | Competitive | - Working with Sesame Street—attractive to children- Innovations increase product distinction- Sell internationally-6th largest producer of disposable baby diapers and 3rd largest marketer of brand-name diapers | - Pampers and Huggies brands are very well known and have large amounts of R&D behind them-Kimberley-Clark holds 77% of training pants market-Competition utilizes advertisements and marketing more effectively- Command 78% of dollar sales for disposable diapers and training pants | Economic | - Stock is up- Sales growth in the industry-Population at a steady growth | - Devaluation of Mexican Peso- Economic uncertainty in Brazil | Legal/Regulatory | - Have a licensing agreement with Sesame Street to include characters on their products | | MARKET SEGMENTATION Dryper Corp. Premium-brand products 52.3% Other branded products 36.6% Private label and other products 11.1% Products distributed Grocery stores 99.1% Drugstores and mass merchandisers 0.9% Domestic market 66.7% Sold in over 28 countries, but focused in Latin America. International market 33.3% We are given (in 1997): Branded products represent 88.9% of company domestic net sales. Private-label and other products account for remaining sales. Domestic sales account for 66.7% of the total sale. International sales account for 33.3% of the total sale. Its brand captured 6.4% of the total dollar volume in domestic grocery store channel.(this number is estimated, so we use 6% instead of 6.4%) Its dollar market share in U.S. disposable diaper and training pants is about 3.1%. Grocery stores account for 51.2% of retail sales of the whole country. Thus, Dryper’s sale from grocery stores account for 3.07% of total domestic sales. (51.2%*6%) Sale from drugstores and mass merchants accounts for 0.03% of total domestic sales. (3.1%-3.07%) So, 99.1% of Dryer’s domestic sale is from grocery; 0.9% of Dryer’s domestic sale is from drugstores and mass merchants. There market segments: Domestic grocery stores 66.1% (99.1%*66.7%) International 33.3% Domestic drugstores and mass merchants 0.6% (0.9%*66.7%) The company had obtained distribution through selected mass-merchant and drugstore chains, so the percentage on that part was increasing. The percentage on International part was also on the trend of increasing form the data from 1995 to 1997. Developing Competitive Advantage Dryper’s Corporation has a competitive advantage due to their ability of competing ideas and quickness, as well as their price competiveness. They are able to remain competitive in their market with Procter & Gamble and Kimberly-Clark who are at the top of their market. Procter & Gamble and Kimberly-Clark both perform extensive advertising whereas Dryper’s Corporation currently does not. Again, their innovative ideas, efficiency, and low prices give them a competitive advantage over the rest of their market. Signing a legal agreement with Sesame Street also contributes to their ability to compete in their market through further innovation. STRATEGIC ISSUE Would a $10 million budget increase allotted for television advertising be beneficial for Drypers Corporation' SECONDARY PROBLEMS/ISSUES * Company has not used television advertising in its 10-year history. * $10 million expenditure represents a 33% increase in combined advertising and promotion budget. * Drypers currently lacks national brand-name recognition. * Drypers typically markets in grocery store chains due to their less extensive national production and distribution capabilities necessary to supply large mass-merchant and drugstore chains. * Currently rely on in-store promotions and couponing as well print advertising in parent magazines and local newspaper inserts. * Conversion of four regional US brands into one common packaging and brand name was overshadowed by competitor sales promotions and pricing. IDENTIFICATION AND EVALUATION OF POSSIBLE ALTERNATIVES Alternative One: Accept the $10 million increase for television advertising The first alternative for Drypers Corporation would be to accept the $10 million budget increase and invest in a television advertisement campaign for the 1999 year. To compensate for this budget increase, Drypers will need to increase sales. Drypers has 3.1% of total dollar sales in the diaper market. Approximately 66% of these sales were made in grocery stores (which account for 51.2% of total country sales). Drypers is currently reaching 33.8% of the grocery store market (.512 * .66) and will need to increase this reach in order to boost sales. The diaper and training pants market achieved sales of $4,525,000,000 this past year and Drypers accounts for 3.1% of those sales. Drypers total sales for 1997 were (4,525,000,000 * .031) $140,275,000. Average cost per unit is considered to be between 18 and 27 cents, so we estimate the price at $0.23 per unit (18+27/2) and in 1997 Drypers sold approximately 609,891,304 units sold ($140,275,000 / 2). Variable cost per unit is $0.14 ($85,848,300/609,891,304) and contribution per unit is $0.09 per unit (.23-.14) and contribution margin is 39%. What absolute increase in sales dollars and units does Drypers need to achieve in order to breakeven and compensate for the budget increase. Unit increase (10,000,000 / .09) must be 111,111,111 additional units and sales must increase by $25,555,556 (111,111,111 * $0.23). Thus, Drypers must achieve $165,830,556 in sales for 1998, or an 18% increase. From 1996-1997, Drypers experienced approximately a 16% increase in revenues. In order to compensate for the $10 million advertising expenditure, Drypers will need to increase their sales by 18% next year, only two percent more than the previous year. This number is easily attainable especially along with the impact that will come from the campaign. Advantages of this alternative include improving brand awareness of Drypers’ products, it will help to increase distribution coverage and facilitate entrance into mass merchant and drugstore segments. Also, television advertising tends to be the most influential form of advertising so it is almost inevitable that sales will increase as a result of this implementation. On the other hand, disadvantages include much risk associated with minimal sales increase and/or not enough additional sales to compensate for the budget increase of 33 percent. There is also the possibility of targeting the wrong audience or incorporating an ineffective campaign or that demand will exceed productivity. For the short term, it will be time consuming to prepare for the implementation and six months is not the best indicator of the campaigns potential, however, it will help to increase product awareness and give Drypers a competitive advantage. In the long run, brand awareness will continue to grow and market penetration will increase. $10 million expenditure in television is nothing compared to what the competitors are spending so Drypers can also consider increasing this amount. Alternative Two: Reject the $10 million increase in advertising budget If Drypers was to reject the $10 million budget increase they would essentially be saving money. Drypers has done very well without worrying about television advertisements thus far and would surely continue at the same rate into the future. Drypers would also avoid a great deal of risk associated with potentially not recovering from the expenditure as well a risk of a failing campaign. There would be no need to develop a new marketing plan and Drypers could continue to offer distributors a low margin. Competitors are spending nearly six times the allotted amount of Drypers so by not accepting the budget Drypers is saving itself a great deal of hassle especially because the competition would probably drown them out with counter-advertisements. The $10 million saved could be used to increase discounts, coupons and in-store promotions, such as trial packs and give-aways. Disadvantages of not accepting the budget would be that Drypers will continue to only reach 33.8% of its potential market and remain trapped in a slow moving market place. They would also risk being overshadowed by the competition due to relatively small brand awareness. Short term effects of this alternative would be no immediate need for increased productivity or employment as well as saving money. As for long term effects, sales will continue at the same rate or even possibly drop and Drypers would continue with its current marketing efforts and play it safe. They will also need to pay no concern to possible brands wars. RECOMMENDED COURSE OF ACTION It is believed that the most appropriate course of action for Drypers Corporation is Alternative One, to implement the new television advertising campaign and increase the budget by $10 million. Structural Changes Drypers Corporation will need hire or designate an associate as for a marketing representative position in order to efficiently implement this television advertising campaign. Additional costs will be incurred in order to maintain this position but salary will not be compensated through the $10 million increase. Drypers will also need to contract an advertising firm to put produce the commercial as well as to assist with placement of the advertisements. Tactical Marketing Activities The Drypers television advertisement campaign will consist of a 60 second television commercial promoting the Drypers brand with emphasis on low price and premium quality with added features. The commercial will be produced and directed by the contracted advertising firm. Our team expects to designate $5 million of the $10 million advertising budget increase to cover costs associated with the making of the commercial. Drypers will continue to target parents (with emphasis on the female population) and toddlers. The commercial will air on five different national television networks, those being ABC, NBC, PBS, CBS and FOX networks. These networks reach the highest number of households and are not direct cable. We expect to allow $500,000 to cover costs associated with the airing of the commercial on each of these networks, thus a $2.5 implementation of the budget. The commercial will air Monday-Friday between the hours of 7:00-10:00 PM (or during primetime television viewing hours) as well as Saturday mornings from 9:00 AM to 12:00 PM, when young children usually “watch cartoons”. We believe these hours will have the most advertising impact and market penetration. That is six days per week, 15 hours each week for the first six months of the 1999 year. It is estimated that the average 60 second television advertisement costs approximately $50 per spot (these numbers may vary depending on the media they accompany) and the allotted amount will cover these costs as well as any other underlying costs. The networks will air these commercials at random within each three hour time slot. $2.5 million of the $10 million advertising budget will be designated for air time. The remainder of the budget, $2.5 million, will be designated for any other underlying costs associated with the television advertising implementation as well as on research and development. Drypers will focus R&D efforts on the risks and benefits associated with advertising on cable television as well as other market penetration tactics. We have allotted for over budgeting in this tactic and feel as though Drypers should treat this next year as a sort of “trial and error” period to help determine if the advertisements should continue. If the campaign is a success Drypers management can start to allocate more than $10 million for future years and spend less on promotions and print advertisement. Probable Outcomes By implementing this television advertising campaign, it can be expected that Drypers will experience a definite sales boost and an increase in demand for their products. With this increase in demand it can be expected that staff will be increased to compensate for the production increase. This includes hiring and training of new employees and a possible additional manufacturing and distribution facility. There is also the possibility that competitors such as Procter & Gamble and Kimberly-Clark will develop counter-advertisements which may influence the impact of the advertisement on its potential customers which will cause Drypers to have to re-evaluate their efforts. This new advertising campaign will increase competition within the industry as well. We believe that Drypers will benefit from this campaign if nothing else and will be allotted a new competitive advantage. Sales increases will more than compensate for the budget increase and Drypers will experience numerous short and long-term benefits. EVALUATION AND CONTROL Considering that this is Drypers’ first time advertising in the television industry there is no historical information that the company can base its data on. Drypers will need to focus on watching the numbers associated with the implementation and determine if sales increased after or during the campaign. Drypers can also calculate the reach of their advertisements and determine if they are successfully reaching their target market and if there is an opportunity available to increase this reach. Management can also develop a survey to distribute to customers. As an incentive to participate in the survey Drypers can offer a promotional coupon/rebate for those who return the finished survey. This data collected will help Drypers determine the effect of the television campaign and forecast future sales. Drypers should also determine if anticipated return was met as well as analyze the year’s financial statements.