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UNIVERSITY OF WATERLOO

ECON 344/ ARBUS 302 PRINCIPLES OF MARKETING & CONSUMER FINANCE


SECTION 003 004




FINAL INDIVIDUAL-PROJECT/CASE-STUDY

Instructor: KHUONG NGUYEN TUAN TRUONG




Please read the following case and discuss the questions in the end. Please note the following:

- This project/case study is worth 25% of your mark.
- This case is selected from the supplementary cases provided to the instructor. All rights and
credits are given to the authors of the textbook Marketing 1
st
Cdn. Ed. (Grewal et. al. 2009).
- Please use Times New Roman font (ONLY!), size 12, 1.5-spaced
- Margins: 2cm
- Reference: APA or Chicago ONLY (DO NOT use the same type of reference at the end of this
case)
- Clearly answer ALL questions (with ample statistical data, relevant examples/evidences from
credible sources) in complete sentences, NO POINT-FORM.
- Maximum number of pages: 10 pages (excluding Appendices, Exhibits and Reference)
- There will be NO minimum number of pages.
- The project/case-study should be submitted with a cover page, clearly state your name, your
student ID, and the section to which you belong.

Due Date: APRIL 3
RD
, 2012 AT 11:30AM to 12:30AM in AL 105 (early submission is accepted
in my office or to the Econ undergraduate office, NO LATE SUBMISSION WILL BE
ACCEPTED)

Academic Integrity:
In order to maintain a culture of academic integrity, members of the University of Waterloo are
expected to promote honesty, trust, fairness, respect and responsibility.
Discipline:
A student is expected to know what constitutes academic integrity, to avoid committing academic
offences, and to take responsibility for his/her actions. A student who is unsure whether an action
constitutes an offence, or who needs help in learning how to avoid offences (e.g., plagiarism, cheating)
or about rules for group work/collaboration should seek guidance from the course professor,
academic advisor, or the Undergraduate Associate Dean. When misconduct has been found to have
occurred, disciplinary penalties will be imposed under Policy 71 Student Discipline. For information
on categories of offenses and types of penalties, students should refer to Policy 71 - Student Discipline,
http://www.adm.uwaterloo.ca/infosec/Policies/policy71.htm


DNA 11: Pioneers in DNA Art
1


If youve 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 persons 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 clients DNA, is literally at the centre of the art piece rather
than some artists 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 companys first major order came from Absolut Vodka, which
hired DNA 11 to create 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 countrys 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 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 11s United Kingdom shipping
address. From there they are sent in batches to the company headquarters in Ottawa. They are then
forwarded to the DNA 11s lab for imaging and shipped back to headquarters. Once the design is
complete, it is uploaded on to the companys servers in the United Kingdom. The images are printed
onto canvas there and shipped throughout Europe. This process is replicated with all of the companys
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 11s founders, the companys
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 11s 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 11s 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 11s website, they are offered services in their own language and with their
countrys 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 customers 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 create a unique family or
couples portrait. Customers can even use their pets 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 a key to the success of CanvasPop because it captures the
customers 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 create 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 products as well. DNA 11 wanted to maintain
one website for all transactions and charge basically a uniform price for its products. In order to do
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 funnelled through the same work space and operational infrastructure as DNA 11. There
was no reinvestment in operations since CanvasPop uses the parent companys 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 create 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 create 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 Citys Times Square for only $40. The customers
canvas was displayed for 15 seconds on one of the biggest digital billboards in New York Citys 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.



















Discussion Questions

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? Discuss advantages and
disadvantages of 4 different media. Analyze the effectiveness of each medium for DNA11 to approach
a larger market, using relevant evidences, statistical data and relevant examples from credible sources.
(Hint: for example, if you choose magazine to be one of your media, discuss demographics of people
would read a magazine in Canada, their behaviours, psychographics, etc. Then, discuss why you think
magazine is an effective tool to reach a large base of consumers) (Total: 20 marks)

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. Discuss and analyze
different media or tools or methods used at each stage based on the information provided in the case
(Total: 20 marks)


3. 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? (Hint: This question refers to the price of the DNA
artwork. Describe the 5Cs in details) (Total: 20 marks)

4. 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? (Hint: Use your
creativity in this question, but you have to keep in mind of the branding theory and of the fact that
DNA11 is a global firm) (Total: 10 marks)

5. DNA 11 has asked you to develop a detailed marketing mix plan that will introduce the new product
(card products) to consumers. Identify and describe a primary target market that would be interested in
such unique cards. Justify your answers with ample statistical data and relevant examples of events
where they would use this product. (Total: 15 marks). Use your creativity (be original and creative!) to
create a name to describe each target markets and a (inclusive) name to describe all target markets
(Total: 2 marks).

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? Justify your answers with ample statistical data, relevant examples and evidences from credible
sources (Total: 28 marks)























Absolut DNA piece
























Kiss Portrait Source: http://www.dnaart.com/






















DNA Portrait
Sources

CanvasPop About Us. The easiest way to print photos on canvas | CanvasPop. N.p.,n.d.

Web. <http://canvaspop.com/aboutus.aspx>. (23 November 2009).

CanvasPop All things virtual will be real again. CanvasPop Blog. N.p. (29 May 2009), Web.
<http://blog.canvaspop.com/?m=200905>. (22 November 2009).

CanvasPop CanvasPop.com Officially Launches. CanvasPop Blog. N.p. (1 October 2009),

n.d. Web. <http://blog.canvaspop.com/?m=200910>. (23 November 2009).

CanvasPop Window sign is up!. CanvasPop Blog. N.p. (30 July 2009). Web.

<http://blog.canvaspop.com/?m=200907>. (24 November 2009).

Church, Patti. "DNA11 The intersection of art & science." Oh Ya Ottawa. N.p., (15 September
2009). Web. <http://ohyaottawa.blogspot.com/2009/09/dna11-intersection-of-art-science.html>. (4 December 2009).

"DNA 11 - About Us" DNA Art by DNA 11 | Your DNA as artwork on canvas. N.p., n.d. Web.
<http://www.dna11.com/about.asp>. (3 December 2009).

"DNA Art by DNA 11 - News and Events." DNA Art by DNA 11 | Your DNA as artwork on
canvas, N.p., (2 June 2008). Web. <http://www.dna11.com/news/news_dna_genes.asp>. (3 December 2009).

DNA 11 - House. DNA Art by DNA 11 | Your DNA as artwork on canvas. N.p., n.d. Web.
<http://www.dna11.com/house/>. (3 December 2009).

"DNA 11 - Partnerships." DNA Art by DNA 11 | Your DNA as artwork on canvas. N.p., n.d. Web.
<http://www.dna11.com/about_partners.asp>. (3 December 2009).

DNA 11 Pop-up Gallery Wrap Up. DNA 11 Blog. N.p. (13 May 2009). Web.
<http://www.dnaart.com/?cat=10>. (22 November 2009).

DNA Portraits. Single Startups (12 August 2009).
<http://singlestartups.com/tag/dna-portraits/>. (22 November 2009).

Domain Name Wire. DNA 11 Protects Turf with Category-Defining Domain Name. (7 August

2009). <http://domainnamewire.com/2009/08/07/dna-11-protects-turf-with-category-defining-domain-name/>. (7 December
2009.)

Duggan, Anne. "That's the spirit: Young entrepreneurs have drive to reach for the top."
canada.com Breaking news Canada World Weather Travel Video & more. N.p., (22 September 2007). Web.
<http://www2.canada.com/ottawacitizen/news/business/story.html?id=12091020-5595-4e1d-8593-7e92cb44c886&p=1>. (3
December 2009).

Katie Deatsch. Foreign Affairs. Vertical Web Media (September 2009).
<http://www.verticalwebmedia.com/article.asp?id=31657>. (5 December 2009).

Nazim Ahmed, interview by Vinay Kambli, Chrystal Mckay, and Sarah Thompson, October 30 2009.

Staton, Tracy. "Genetically Gifted." American Way Magazine. N.p., (15 June 2008). Web.
<http://www.americanwaymag.com/adrian-salamunovic-nazim-ahmed-tracy-staton-dna-imaging-technology>. (13
November 2009).



1
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.