Practice Long Answer Question for Marketing Final (Textbook: GREWAL 4CE - MARKETING)

1. If DNA 11 had access to a larger promotion budget, what mass media tools would you recommend they use to effectively reach their target market of affluent professionals?
2. Using the AIDA model, discuss the events and marketing communication elements that helped consumers move through the various stages to eventually purchase the artwork.
3. DNA 11 is considering the launch of a new line of cards to the consumer market. They are unsure if the cards should be developed as greeting cards with witty sayings inside, blank cards that consumers can write their own notes, other types of card, or a combination. What desirable qualities for a brand name should DNA 11 consider to help ensure that the cards will be successful?
4. What pricing advice would you give DNA 11 bearing in mind the impact each of the 5Cs of Pricing has on formulating good pricing decisions
5. DNA 11 has asked you to develop a detailed marketing mix plan that will introduce the new product to consumers. Identify and describe a primary target market that would be interested in such unique cards.
6. Develop a detailed set of recommendations for each element of the marketing mix for the cards based on the target market identified. Describe the product strategy you would recommend. What price should the cards sell for? Where should cards be sold and what distribution strategy would be the most effective for maximizing sales? What promotional tools would you use to reach consumers and ensure sales?

Case Text

DNA 11: Pioneers in DNA Art[i]

If you've ever had trouble finding a gift for the person who has everything, DNA 11 has a solution as unique as each individual - DNA art. The small Ottawa-based company was founded in 2004 by Adrian Salamunovic and Nazim Ahmed. Together they pioneered the application of genetic science to create truly personalized unique custom art such as Kiss portraits, fingerprint portraits and Mini DNA portraits.

The concept is deceptively simple but unique. It requires a sample of a person's DNA, which is sent to a lab that extracts the DNA, looks for specific genes that creates a one of-a-kind profile, and prints the image. According to Salamunovic, the resulting image, called a DNA Portrait, resembles an abstract oil painting except the client, or rather the client's DNA, is literally at the centre of the art piece rather than some artist's rendition of the subject.

To order a DNA Portrait, customers simply visit the DNA 11 website (www.dna11.com), place the order, and pay for the art. Customers get to choose the size and colours of the art piece they want and whether or not they want it to be framed. Once the order and payment are received, the company sends the customer a DNA collection kit. Customers take a DNA sample, usually a mouth swab, and mail it back to the company, which then creates a customized piece of artwork based on the DNA sample and ships it to customers. The process takes approximately six weeks.

Company Growth

In the summer of 2005, DNA 11 began with a basic website, DNA11.com, to make personalized DNA art available to anyone worldwide. The company's first major order came from Absolut Vodka, which hired DNA 11 to c.reate an art piece showing the DNA of a peach and a mandarin to be used in a marketing campaign for flavoured vodka.The piece was featured at the DNA 11 website launch party at a club in downtown Ottawa that was attended by design and technology bloggers, members of the media including

Fashion Television, CTV, and CBC, and friends and family of the owners.After the launch party, the story of DNA 11 began appearing in arts, design, and technology blogs.

Almost immediately DNA art was being talked about around the world.

Within weeks, DNA 11 made their first online sale using a simple PayPal account.

However, the tipping point for DNA 11 came after an article about the company appeared in USA Today. Immediately after this story, sales picked up dramatically; with orders coming from over 50 countries. With growing demand from across the world, DNA 11 soon realized that their current shipping network and English-only website was inadequate to serve customers effectively, allow it to compete globally and maintain its pioneering position.

DNA 11 turned its focus to making the company more responsive to its customers worldwide and to cement its position over copy-cat competitors. The website was localized so that customers were greeted in their own language (English, French, Spanish, and German) and with their country's flag on the home page.Geo-targeting in this manner allowed them to be locally responsive, cost-effective, appeal to a wide range of customers, and build strong customer loyalty.In addition, the company has developed very strict privacy and security policies that are posted on its website. Its standards for collecting, processing, storing, and using customers' DNA samples are among the 2 strictest in its industry. Orders from Australia jumped 400 percent soon after DNA 11 began welcoming Aussies with their flag and offering free shipping.Localizing their website for French, Spanish, and German-speaking markets also made a difference -

DNA 11 started receiving steady orders from customers in Germany and Spain, which previously generated few orders.About 40 percent of orders now come from outside

North America.

DNA 11 also expanded its global reach by forming partnerships with international printers in Europe, the United States, Canada, Australia, and India and plans to form a printing partnership in Japan.For example, European customers ship their DNA collection kits to DNA 11's United Kingdom shipping address.From there they are sent in batches to the company headquarters in Ottawa.They are then forwarded to the DNA

11's lab for imaging and shipped back to headquarters. Once the design is complete, it is uploaded on to the company's servers in the United Kingdom.The images are printed onto canvas there and shipped throughout Europe.This process is replicated with all of the company's international partners ensuring its strict quality and packaging standards are upheld.More recently, a partnership with a printer in India was formed which reduced the costs to customers in that region to order DNA art. DNA 11 also has a 24-hour call centre in Kingston, Ontario that provides customer support.

Through these various marketing efforts, DNA 11 experienced strong growth over the past five years. Revenues quadrupled from $500,000 in 2005, the first year of operation, to about $2 million in 2009. DNA 11 has customers from over 50 countries around the world.Its largest markets are the United States, the United Kingdom, Europe, and

Canada. According to DNA 11's founders, the company's rapid growth is mainly due to its savvy use of social media and viral marketing, a sound e-business strategy, a globally dispersed supply chain, and an efficient operations management system.

Industry Analysis

Not surprisingly, although DNA 11 pioneered DNA art, it soon discovered that other companies were imitating its idea and selling copy-cat versions all over the world.To stave-off competition and to assert its position as the industry pioneer and leader, DNA

11 embarked on an aggressive strategy to differentiate itself. For example, the company entered into partnerships with the Museum of Modern Art in New York and Tokyo where the curators at the Museums would place DNA 11's artwork on display in their design stores.The credibility obtained from working with a highly reputable brand like the

Museum of Modern Art significantly enhanced DNA 11's reputation as the preeminent

DNA art provider within the industry.

In addition, the company paid about $3,000 to purchase the domain name DNAArt.com, a category-defining domain name, from veteran domainer Page Howe who had owned the name. According to co-founder, Adrian Salamunovic, "the domain name,

DNAArt.com, further helps us own the market" since it reinforces that the company is the leader in the DNA art industry. DNAArt.com, which is used for a separate blog also drives business to the main home page, DNA11.com. Further, the ability of DNA 11 to leverage social media and its reputation among key technology, design, and art bloggers were used to differentiate the DNA brand.

Another element of its competitive strategy was to create localized (translated) websites so that when customers log onto DNA 11's website, they are offered services in their own language and with their country's flag on the home page.Geo-targeting helped build customer loyalty.New product innovation was also used to differentiate DNA 11from its competition.Each year DNA 11 introduced a new product to their product line. Pricing was another differentiating factor for DNA 11, as they were able to keep their prices lower than the competition, while maintaining high quality products.

Another huge differentiator was the customer's ability to customize and personalize their product in almost any way they wanted. The ability of DNA 11 to leverage personalization technologies in order to respond to the new consumer trend for more customized and personalized products set it apart from its copy-cat competitors.

Products

Initially, DNA 11 offered its DNA Portraits, which are described by American Way magazine as "unique renditions of human essence that appear as bars of light that scale up and down strands of symmetrical code, looking like neat, geometrical skyscrapers in a view of downtown at midnight.But these lights explain hair and eye color, athletic ability, life span".Customers can customize the art piece in terms of dimensions, frame type, colours, and mount thickness.DNA 11 also assists customers and interior designers achieve greater personalization by matching artwork colour schemes to Pantone and Behr paints, or visually based on carpet, floor, or furniture samples so that the art piece is a perfect fit for the room. Customers are also able to have their portrait printed on a variety of media including glass, acrylic, Plexiglas, and steel. In addition, DNA 11 offers even more ways to personalize the product such as the ability to combine DNA samples to c.reate a unique family or couple's portrait. Customers can even use their pet's DNA as part of the portrait.

Recently, DNA 11 expanded its product offering with, GenePak, which offers customers another level of personalization. GenePak is an upgrade that can be added to a DNA art piece that allows customers to specifically identify genes related to their athletic ability, intelligence, love, and gender. As part of their product expansion, DNA 11 also offers customers the ability to turn their fingerprints (FingerPrint Portraits), lipstick kisses (Kiss

Portraits) and personal photos (CanvasPop) into artwork.

CanvasPop is new spin-off company that DNA 11 launched on October 1, 2009. This new start-up focuses on digital printing, i.e. turning any photo or image into beautiful custom canvas art.The photos are printed onto high quality canvas of any size allowing for mass personalization.The company can produce the canvas art by working with any resolution image; whether it comes from Facebook, an iPhone, or a $5,000 camera. The brand is all about fun, great customer service, and making entry-level canvas art affordable to anyone.CanvasPop images are conversation pieces which capture a moment in time, or a unique memory.Personalization is key to the success of

CanvasPop because it captures the customer's image and story.CanvasPop was introduced in response to the need for an innovative, affordable, and creative solution for bringing physicality to a world of virtual content. CanvasPop products are photo-realistic, gallery-quality prints.

DNA 11 customers are typically well-off professionals who often purchase the art pieces to celebrate their uniqueness, to give the gift of celebrating individuality, to remember a loved one, or to c.reate a conversation piece about them. Of course, narcissism could be a motivation for some people to purchase these art pieces. However, the vast majority of customers tend to be people who want to celebrate their individuality and give the art pieces as gifts. For example, many women purchase the Kiss Portraits for their husbands or significant others.

Pricing

The price for the art pieces range from $200 to over $1000. DNA Portrait, the initial product offered, is a higher priced product catering to the niche market customer who can afford a high-end art piece.However, in order to cater to other market segments, DNA

11 introduced DNA Mini Portraits, Kiss Portraits, Finger Portraits, and CanvasPop, which are more reasonably priced and serve the mass market. For example, DNA Mini

Portraits were an extension of their original DNA Portrait, allowing for a smaller portrait with a lower price in comparison to their original full size version.

Given the global interests in DNA 11 art work, the company seemed to have little choice but to make its products available globally. However, selling a product globally means that DNA 11 must deal with the challenges of exchange rates, duties, taxes, shipping, distribution, and other factors that could not only affect the price it charges but the distribution of its productsas well. DNA 11 wanted to maintain one website for all transactions and charge basically a uniform price for its products. In order to d.o this,

DNA 11 entered into partnerships with printers in its major markets around the world.

For example, through a partnership with a printer in the United Kingdom, the company maintained its pricing competitiveness in the European market as customers in the region did not have to pay duties that drive-up the cost of the art.

Place

DNA 11 art can be ordered and paid for through their online store, www.dna11.com. To reach new customer bases, DNA 11 positioned its products in the design stores of the

Museum of Modern Art in New York and Tokyo.Customers visiting the museum can view the art on display and purchase a DNA collection kit on the spot, then place their order on DNA 11 website.DNA 11 has also developed close relationships with interior designers, art galleries, architects, and custom furniture retailers to position and promote their products among their target markets. In each case, DNA 11 positions their pieces as a way for customers to add customization and personality to their homes and offices.

CanvasPop is funneled through the same work space and operational infrastructure as

DNA 11. There was no reinvestment in operations since CanvasPop uses the parent company's existing footprint, and the sole additional investment was the website.The product is shipped to customers through the same distribution network already available and established through DNA11.

Promotion

Being a small company with a very limited marketing budget, DNA 11worked hard to identify and take advantage of free advertising and publicity. Recognizing the unique style and creative attributes of the art pieces, the company opted for advertising that was more viral and conversational in nature rather traditional mass media (radio, TV, print media). Thus, in its early stages, DNA 11 relied almost exclusively on arts, design and technology blogs, social networking sites (Facebook, Twitter, etc) and its own website to c.reate awareness, promote the DNA 11 brand, encourage purchase, and build relationships with customers. This strategy worked as DNA 11 quickly gained worldwide exposure to thousands of people in the target market that followed these blogs. And as bloggers wrote about the unique, new idea to the art world, traditional newsprint and television writers picked-up on the stories and turned to these blogs as sources of information to write their own stories on DNA 11.Shortly thereafter, Salamunovic and

Ahmed were invited by network televisions (e.g. CBC, CTV, the Discovery Channel), design shows, and newsprints such as USA today, Playboy magazine and Maxim to do interviews about their unique concept.Media interviews with the Discovery Channel,

CTV and CBC and other media established DNA 11 as a credible business motivated to cultivate a wide audience and gain global exposure. According to Ahmed, the tipping point for DNA 11 in terms of sales came after a story about DNA 11 appeared in USA

Today - sales increased substantially and orders came from all over world.

In addition to blogs and social media, DNA 11 opened a pop-up gallery, DNA 11 House, on February 25, 2009 in Hermosa Beach, California. DNA 11 House offered guests a

modern yet intimate setting to select, customize, and buy one-of-a-kind DNA 11 art pieces.It was opened to the public, by appointment only, from February 25 through

April. DNA 11 House conducted hundreds of guided tours, received extensive media attention and publicity, and sponsored a wrap-up party, which was co-hosted by 944

Magazine.

Salamunovic personally walked visitors through DNA 11 House and explained the creation process of DNA 11 art.The DNA 11 House was positioned as more than just a gallery showcasing DNA 11 artwork; it was a venue for people to learn about the personalization process of making art pieces that redefine the modern day self-portrait.

Guests of the gallery had the opportunity to witness firsthand how DNA is collected and transformed into one-of-a-kind art pieces.In keeping with its cutting-edge image, DNA

11 House was constructed using innovative green technologies and materials and its design aesthetic served as the perfect setting to display the modern, innovative look of the various DNA 11 artworks.

DNA 11 House was strategically located in California to reach the large arts and celebrity communities, leverage its DNA 11 for Charity concept, and enhance the DNA 11 brand by cultivating a strong customer base. For example, DNA 11 partners with celebrities

(e.g., Elija Wood) and uses their DNA to c.reate art that can be auctioned off to raise money for the celebrities' favourite charities.In return, DNA 11 benefits through free publicity and exposure.

In 2009 when DNA 11 launched its new spin-off company, CanvasPop, it offered the first

100 CanvasPop customers the option to have their custom canvas prints from CanvasPop displayed on the 7,400 square foot Reuters' billboard in New York City's Times Square for only $40.The customer's canvas was displayed for 15 seconds on one of the biggest digital billboards in New York City's Times Square for more than 1.5 million people to see.

From blogs to galleries to the Museum of Modern Art to celebrity partnerships, DNA 11 built a global brand on a shoestring budget. Finally, DNA 11 worked relentlessly to protect its brand and to ensure that the only positive messages about the company and its products appear on online. To this end, DNA 11 hired a Social Media Manager to scour the Internet searching for any blog, discussion forum, customer review website, and even personal twitter accounts to find any negative publicity about DNA 11 or CanvasPop in order to "squash it right there" according to Ahmed. Any negative message is dealt with expeditiously and every attempt is made correct it, even if it means refunding a purchase in full.

[i] The information for this case is based primarily on an interview with DNA 11 Co-founder, Nazim Ahmed, and information on DNA 11 websites. This case was prepared by Vinay Kambli, Chrystal Mckay, and Sarah Thompson under the supervision of Dr. Ajax Persaud (University of Ottawa). This case is prepared for teaching purposes rather than to reflect effective or ineffective marketing practices.