Smart Kids Ltd. An Auckland company that makes educational games and resources to read and understand math won a Trade New Zealand Export Award for its success in international markets in 2003. Established eight years ago in the family home basement, Smart Kids is led by a husband and wife team, joint chief executives David and Sun Miln,e and their sons Duncan and Frase. She Milne, an ex-teacher, says from just 30 products when it started, the company produces more than 200 products catering to students' activities, grammar concepts, and numeracy. She says the international appeal of Smart Kids products was highlighted recently when the company's SMART PHONICS was listed amongst the top five products out of almost 100 in the education trade show in the United Kingdom. The key requirement for every new Smart Kids product is that it stimulates students' minds in the classroom, teaches them a specific concept easily, enjoyably, and permanently, and enables problem-solving. David Milne says Smart Kids started selling its educational games and resources to New Zealand schools in1995, drawings an immediate and strong response. It quickly became apartment that the New Zealand market was not large enough to sustain considerable investment in product development, and secondly, that their products have done so well that they deserved wider exposure."Our export research came down to two options. Find educational distributors in other countries or set up our operations. The first option was less risky and easy to manage but it meant that Smart Kids products were lost in a wide range of materials. So we went for the second option and over the next few years established offices in Australia, in UK, and Canada". This has successfully branded Smart Kids as a leading supplier of educational resources in these countries. Mr. Milne says the Smart Kids product catalog is now sent regularly to teachers in more than 50,000 schools across the UK, Ireland, Canada, and Australia. "We also sell to schools in the US. In that market we elected to work through a distributor, we didn't have the financial resources to set up an operation that could cover almost 70,000 schools and compete with every established educational publisher". He says annual exports now exceed $2.2 million and account for more than 90% of turnover. To grow the business, surplus profits are reinvested back into product development, and infrastructure the company recently moved its Auckland operation into new20,000 square feet premises in Ellerslie. Mr. Milne says the Smart Kids brand is now well-established internationally with the company enjoying many competitive advantages, including its New Zealand origin. New Zealand education is highly regarded overseas and we find that international teachers get hold of educational products made in this country.

Q1. Explain the aforementioned case study in light of the BCG Matrix.

Q2. Discuss the procedure of market segmentation for the above case to increase the market share.

Q3. Outline the major consideration according to Smart Kids Export Distribution Company must take in making a company a brand.

Q4. Critically analyze any five reasons for failures that might can occur in Smart Kids Export Distribution Company.

Q5. Critically evaluate what steps Smart Kids Export Distribution Company must take in developing a pricing strategy for their product to increase market share.