Participant document.

Introduction - Case Study.

Introduction Case Study

Developing an e-scooter market launch for BestBike Ltd.

Dear Candidate,

In the following exercise, you will work on a case study regarding the development of an e-scooter market
launch for the BestBike Ltd. Your task will be to prepare answers to three given questions based on the
provided materials and present these answers to your project team (observers).

Background

The e-mobility market in Germany is booming - more and more people are no longer using their own car
with a combustion engine to get from A to B, but are switching to e-mobility alternatives such as the e-car
or e-bike. The latest trend for e-mobility is the e-scooter. There is a growing market for e-scooters in
Germany with experts forecasting further growth and as a result a promising sales market.

BestBike Ltd. was founded in 2005 and has established itself as a bicycle company that distinguishes itself
through innovation, first-class quality and customer satisfaction. BestBike Ltd. has its headquarters in
Leipzig, but also has production sites in Kassel, Mainz and Hanover. The company distributes its products
via retailers throughout Germany, its own stores in Leipzig and major cities in the Rhine-Main region as well
as online. Most recently, they have positioned themselves as an attractive company that attaches great
importance to further development, ensuring sustainability in production and valuing its employees.

The existing bicycle market is already well covered and does not promise much growth, at least in the near
future. Competition is fierce and BestBike Ltd. must therefore find new ways to stand out against other
companies and remain competitive in terms of price. As expert analyses show, the market for e-scooters
will grow, so entering into this new market segment could give BestBike Ltd. a second foothold and
stabilize the company in light of the foreseeable crisis within the bicycle market.

The executive board has set the goal of entering the e-scooter market and manufacturing BestBike’s own
e-scooter models. A project team called "E-Scooter Launch" was set up to develop a concept for entering
the e-scooter market. The project team consists of two engineers, two business economists, including your
mentor T. Noske, and you as a trainee. The implementation of the project is still in its starting phase. It is still
unclear for which target group(s) products should be launched, how the products should be designed
according to the needs of the target groups and how a successful market launch could be realized. Since
there are already several companies that are successfully selling e-scooters, the aim is not to cover the
entire market with our own products. Instead, the main goal is to close promising gaps in the market and to
tailor the products precisely to the needs and wishes of the customers. This is how BestBike Ltd. wants to
set itself apart from its competitors. BestBike Ltd. attaches great importance to high quality and innovation
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and wants to distinguish itself from its competitors in this way as well. As production and development of
the e-scooters will initially (pilot phase) only take place at the Leipzig production site (about 5,300
employees), the available resources are limited. In the pilot phase, e-scooter sales will be carried out in the
Leipzig area in order to avoid unnecessary transport costs. Your mentor T. Noske has asked you to conduct
research and gather information about the current market situation. You will now create a summary for the
project team based on the collected information. It should contain the following aspects:

1. Target group(s): Which target group(s) should BestBike Ltd focus on? (Advantages /
disadvantages of your chosen target group(s)?

2. Select the e-scooter model(s): Which e-scooter model(s) should be offered to the selected
target group(s) (advantages / disadvantages of your chosen model(s))?

3. Create a concept for the market launch based on the Strategy Diamond (Hambrick &
Fredrickson, 2001): How would you design the market launch? Develop innovative solutions /
ideas for the respective elements of the strategy diamond based on the given information.

Concept of the "Strategy Diamond" (Hambrick and Fredrickson, 2001)

Hambrick, D. C., & Fredrickson J. W., (2001). Are you sure you have a strategy? Academy of Management Executive 15(4).

Task:

Your task is to familiarize yourself with the existing documents and extract the essential information. Make
clear recommendations for the three questions using the material provided. You should be able to explain
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why you have chosen your selected target group(s) and why your selected e-scooter model(s) fit(s) the
target group(s). Be creative when developing your market concept and surprise the project team with
unconventional and innovative ideas. Stay realistic and weigh resources and costs against each other.
Anticipate potential problems/difficulties and prepare proposals for solutions. You will present the results of
your analysis and strategy to the project team "E-Scooter Launch" (observers). After the presentation, they
will ask you questions about your recommendations and concept.

Please note:

- For the successful completion of this task only the information from the following documents should
be used. Own background knowledge about e-scooters should not be considered.
- For the presentation, you can use a flipchart as memory aid. However, the design of the flip chart will
not be evaluated.

Goal

Your goal is to be able to clearly justify your recommendations and to present a well thought-out
and long-term successful market launch concept.

Total time: 65 min

 Preparation time: 45 min

 Presentation: 10 min
 Observer questions: 10 min

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Sales numbers of the current main providers

Current main providers: ComfyRide, Smart Bikes & E-WheelsNow

Current main providers: City Cruise, Practical 4 You & Fun 2 Me

* Approximate calculations for the current year
201y-1 = last year
201y-2 = two years ago
201y-3 = three years ago

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Scheme and results of a nationwide telephone interview conducted by the German

Association for Innovative Technologies (GAIT)*

Younger Middle-aged
Pupils Students Older workers Retirees
workers workers

Question 1: Are you in general interested in purchasing an e-scooter?

Yes 65% 39% 33% 54% 14% 58%

Question 2 (Only to the ones who

answered “yes” in question 1): Have you already bought an e-scooter?

Yes 21% 11% 13% 23% 12% 9%

Question 3 (Only to the ones who

answered “yes” in question 2): Where did you buy your e-scooter?

City Cruise 11% 8% 13% 19% 31% 29%

Practical 4 You 9% 21% 35% 22% 18% 16%

Fun 2 Me 53% 45% 22% 6% 5% 8%

Other 27% 26% 30% 53% 46% 47%

* the interview by GAIT, the attitude and intention to buy different innovative products were asked. As soon as a question was
answered with “No", the interviewer continued with the next product (e-scooter was one of 10 innovative products). About 10.000
participants took part in the nationwide survey of GAIT.

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University survey: Rent or Buy?*

* The survey was conducted by a German university to assess the willingness of different customer groups regarding the
purchase or rent of e-scooters in Germany. In total, 357 people were interviewed in pedestrian zones in two German cities.

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Percentage of reasons for customer dissatisfaction with e-scooters

Shown are industry-specific estimates of proportions from "Next Gen: Scooter Magazine”. They used data
from customer surveys of the three main providers. Reasons for dissatisfaction were collected in potentially
annoying situations for the customers (e.g. when the customers returned their scooters, had to repair them,
etc.).

* caused by manufactural errors

** a warranty was given for two years

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Average distance traveled using an e-scooter in one day

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Results from a survey of potential customers*

* BestBike Ltd. hired a market research institute to conduct a survey on needs and demands of different customer groups
regarding the purchase of e-scooters in Germany (interviews in pedestrian zones of German cities). Results are shown for people
who in principle are interested in purchasing an e-scooter (n = 1135).

Middle-
Younger Older
Pupils Students aged Retirees
workers workers
workers
Which characteristic is the
The set of questions does not allow multiple answers. We asked the respondents to select the
most important to you when
characteristic most important to them.
choosing an e-scooter?
High Safety 3% 14% 1% 4% 9% 26%

High Comfort 2% 6% 26% 31% 23% 35%

Price-performance 10% 51% 28% 27% 2% 7%

High quality and good

3% 10% 21% 26% 29% 17%
workmanship
Technical features and
42% 12% 19% 9% 34% 3%
innovativeness

Simple and intuitive handling 5% 2% 0% 2% 3% 12%

Trendiness and prestige 35% 5% 5% 1% 0% 0%

Why would you buy an e- This set of questions does not allow for multiple answers. The respondents were asked to
scooter? choose the most important reason for buying an e-scooter.
For daily commute (to
59% 39% 41% 46% 31% 4%
school/university/work)

For excursion 2% 8% 10% 1% 2% 32%

To simplify my everyday life 20% 21% 1% 11% 3% 36%

As a means of transport
1% 3% 30% 27% 28% 26%
when traveling
Technology and innovations
18% 19% 18% 15% 36% 2%
are fascinating me
What would be the main
This set of questions does not allow for multiple answers. The respondents were asked for which
reason for not purchasing a
reason they would decide against buying an e-scooter.
particular e-scooter?
Maximum range < 20 km 13% 2% 33% 31% 29% 79%

High maintenance costs 25% 21% 15% 6% 9% 9%

Handlebar not foldable 5% 5% 37% 51% 35% 7%

Price > 1000€ 46% 54% 13% 11% 8% 2%

I already have enough

11% 18% 2% 1% 19% 3%
means of transport

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E-Mail from K. Tibelt

From: [email protected]
To: Project Group
Subject: Product Portfolio

Hello everyone,
The product portfolio of our prototypes can be found in the appendix for a better overview. I am already
very curious to see which model(s) we are going to launch on the market. Please note: The models are
hereby fixed, which means that no features or characteristics of the models can be changed!

Furthermore, this morning, the patent procedure for our "pedelec drive system" was finally approved and
completed. For your information:
Instead of controlling the speed on the handlebars, the driver simply steps on a pedal, which is attached
to the back of the running board, directly in front of the rear wheel. Once the e-scooter is in motion, it can
comfortably accelerate further at intervals of approx. 4 km/h by repeatedly stepping on the pedal. This
has the advantage that you can also install a cruise control function. The cruise control function can be
set via the on-board computer and activated by permanently pressing the pedal. This also gives you
more control over the vehicle, as the hands are used solely for holding the steering wheel and braking.

Greetings and a great weekend to all of you.

Klaus
Klaus Tibelt
Engineer
BestBike Ltd.

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Product portfolio

This product portfolio has been designed by the BestBike Ltd. R&D department. It shows different types of
e-scooters that could go into production.

Youth Scooters Classic Scooters Premium Scooters

Series Micro Freestyle Basic Basic Comfort High Tech Premium
Premium Comfort
Technical Low High Low Medium Very High High
Details
Speed Max. 10 km/h Max. 17 km/h Max. 15 km/h Max. 20 km/h Max. 20 km/h Max. 17 km/h

Ultimate Load 75 kg 80 kg 100 kg 125 kg 125 kg 150 kg

Range Max. 15 km Max. 15 km Max. 15 km Max. 25 km Max. 25 km Max. 20 km

Weight 7,2 kg 11,5 kg 12,0 kg 18,5 kg 27,5 kg 32,0 kg

Additional Wheel diameter: On-board On-board On-board On-board

information 6 inches computer computer computer computer
Recording of Intelligent Wheel diameter:
speed and assistance 12 inches
distance systems 3 wheels
Available in 7 Connecting
different colors mobile devices
and designs possible
Comfort Low Low Medium High High Very high

Charge time 3h 5h 2,5 h 5h 6,5 h 4h

Handlebar Not foldable Not foldable Not foldable Foldable Foldable Not foldable

Additional Low shock Medium shock High shock 10 speed levels Comfortable
information absorption absorption absorption Cruise control seat
2 speed levels Broad footboard Ergonomic GPS Cruise control
handle Very high shock
Cruise control absorption
7 speed levels Attachable
basket
Easy-to-charge
battery
Safety High Low Low Medium High High
features
Front and LED lights None Standard lights LED lights High High
back lights performance Performance
LED lights LED lights
Brakes Hydraulic Hydraulic Standard Standard High-quality Hydraulic
brakes brakes brakes brakes hydraulic brakes brakes
Additional Solid rubber Intelligent Rear-view
information tires braking system mirrors
Turn signal
Horn
Necessary Medium Medium Very Low Medium High High
maintenance Complex brakes Complex brakes Affordable Periodic Costly software Periodic
No flat tires Long-lasting spare parts software updates software
possible battery No high- updates Expensive updates
Periodic maintenance necessary repair necessary
software technology Occasional Expensive repair
updates readjustment of
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necessary brakes
necessary
Price 399 € 599 € 499 € 899 € 1800 € 1500 €

Satisfaction with various types of e-scooters

Employees of the BestBike Ltd. tested the different prototypes shown in the portfolio for one week and
assessed their satisfaction with the prototypes afterwards. 600 people took part in the testing phase (100
for each model).

* These prototypes were tested by the children of BestBike Ltd. employees.

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Extract from an online business magazine

www.business-for-future.de/new_trends/headlines
New Trends Stock Market Global Economy Political Situation
In this section, we discuss the latest trends and developments that you should consider when designing
your business. We are regularly interviewing experts from the fields of politics, business, education and
market research to provide you with the most useful recommendations for your business.

Headlines of the month

Going to school by bus is out!

Children and adolescents do not want to have to wait for the bus anymore when they go to school in
the morning. Especially in rural areas, buses do not run very frequently, resulting in waiting times of up
to one hour. No wonder pupils are no longer willing to accept that. They now prefer means of transport
that offer more flexibility and less dependency on public transport. Many go to school by bicycle or buy
a motorcycle as soon as they are old enough. But there are now other affordable and comfortable
alternatives... click here to read more.

It’s all about quality!

In times of cheap mass production, companies must compete more and more for the best prices and
therefore often neglect the quality of their products. Today's customers, however, often have a desire
for higher quality and longer lasting products, and are willing to accept higher prices for well
manufactured goods. Experts predict that awareness of quality and good workmanship will become
even more important in the future. Click here to read more.

High-tech everywhere!
It seems as if the market is continuously flooding us with the latest technologies. Whether it’s artificial
intelligence, autonomous driving or virtual reality, sophisticated innovations enter the market almost
every day. Certainly, companies have good reason to develop new products all the time, because
demand determines supply here, too. The population's fascination with technological innovations will
probably still last for some time. Click here to read more.

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E-Mail from T. Noske

From: [email protected]
To: [email protected]
Subject: E-Scooter launch

Dear trainee,

I am delighted that you will support this new project and that you are already contributing in the first
steps. As discussed in the team meeting last week, I am convinced selling e-scooters will be a great
opportunity for us to establish a new market for BestBike Ltd. I am looking forward to your presentation
about our first steps in this innovative market segment.
I summarized some of the main points we determined last week. These proved to be especially important
or to be focused on in terms of our project:

 First, we will need to know which target audiences and interest groups we want to
address with our new products. On what age group(s) should be we focused on?
 Our company stands, among other things, for innovation. That is why we should clearly plan
an innovative concept of our market launch.

Another recommendation:
 As a matter of fact, we are new to this market segment, so we should pay close attentions
to the costs. It could easily happen that we make wrong assumptions or calculations.

If you have any questions, please do not hesitate to contact me.

Best regards,
T. Noske

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