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##### Imagine that you are a marketing manager in charge of developing a marketing campaign for Lenovo Computers

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**Question**

Imagine that you are a marketing manager in charge of developing a marketing campaign for Lenovo Computers (www.lenovo.com). Your company is currently selling products in fifty (50) different countries around the world. Lenovo just launched a new notebook. One (1) of the issues that you face is whether Lenovo should employ a multicountry strategy or a global strategy for the new notebook. Your job as a marketing manager requires you to first use an analytical tool to forecast Expected Commercial Value - Net Present Value (NPV) over the next ten (10) years.? NPV is used to determine the value of future cash in todayâ€™s dollars. NPV is simply the value of the expected future returns of an investment minus the value of expected future cost expressed in todayâ€™s dollars.;Section 1: Expected Commercial Value Forcast;1. Utilize the Expected Commercial Value Excel Calculator to estimate the potential commercial success of the new notebook. Note: The Expected Commercial Value Excel Calculator can be found in the online course shell.;a. Fill in the Cashflows section (column FY 13 through FY 23) found in the MS Excel sheet to project an NPV of above $10,000,000.?;Development Costs;Launch and Marketing Costs;Forecasted Units Sold;Assuming the following parameters remain the same in the Excel calculator.;Probability of Commercial Success;0.8;Probability of Technical Success;1;Unit Sales Price;$400;Discount Rate;0.06;b. Estimate the commercial success of the new notebook, based on your quantitative analysis from 1a of this assignment.;*************************************************************************;Expected Commercial Value (ECV) Calculator V.05;The ECV Calculator provides a quick estimate of a project's commercial viability. It is not meant to be the only decision tool when evaluating the;desirability of a project. It does provide insight as to whether a project warrants further review and justification as well as point to potential issues.;Instructions;The following information is needed to perform this project analysis;* Cost of Capital (Discount Rate) the company experiences.;* Estimated Unit Sales Price;* Estimated Development cost of the project;* Launch and Marketing Costs for a 10 year period;* Forecast of Unit Sales for a 10 year period;* Estimate of technical success probability;* Estimate of commercial success probability;This data is completed in the rows with Blue Titles on the Input Tab. Cells with "Green" text are calculated and should not be overwritten.;1) Enter values for Probabilities & Cost of Capital in the first table on the Input tab;2) Enter values for Development Costs, Launch Costs, and Estimate Unit Sales in the second table on the Input tab;Estimated Commercial Value of project will be displayed at top of the Input tab and on the Output tab. The Output tab also displays the Expense /;Revenue Chart.;Support;Dr. George J. Gannage Jr.;Strayer University;george.gannagejr@strayer.edu;Expected Commercial Value (NPV);$0.00;Probability of Commercial Success;Probability of Technical Success;Unit Sales Price;Discount Rate;0.8;1;$400;0.06;Cashflows;Development Costs;Launch and Marketing Costs;Forecasted Units Sold;Forecasted Revenue (Unit Sales Price x Units Sold);FY13;Discounted Cashflows (10 Year);NPV Income;NPV Development Costs;NPV Launch and Marketing Costs;FY 14;FY15;Calculated;FY16;FY17;FY18;FY19;FY20;FY21;FY22;FY23;$-;$-;$0.00;$0.00;$0.00;Marketing Cost Ratio;Success Probability;0.2;0.4;0.6;0.8;1;1.2;1.4;1.6;1.8;2;2.2;2.4;2.5;2.6;2.8;3;3.2;3.4;3.6;3.8;4;0.2;0.4;0.6;0.8;1;Cost of Capital;0.06;0.08;0.1;0.12;0.14;0.16;0.18;0.2;0.22;0.24;0.26;0.28;0.3;$-;$-;$-;$-;$-;$-;$$-;$-;$-;$-;$-;$-;$-;$ 1.00;$ 0.90;$ 0.80;$ 0.70;$ 0.60;Development Costs;Launch and Marketing Costs;Forecasted Revenue (Unit Sales Price;x Units Sold);$ 0.50;$ 0.40;$ 0.30;$ 0.20;$ 0.10;$FY13 FY 14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23;Expected Commercial Value (NPV);$0.00;Attachments;ExpectedCommericalValueCalculator.xlsx (22.81 KB)

Paper#30779 | Written in 18-Jul-2015

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