Cango Final Report- REV2 in Business Proposal

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Primarily, the market for CanGo Inc. will be segmented in two ways, which include gender and age groups. Segmentation according to income groups cannot be used because all services provided by CanGo Inc. will be easily affordable by all income groups since the company cannot afford to charge high prices due to competitive pressures. Many services such as gaming will also be provided for free.

Marketing Mix

The marketing mix of CanGo Inc. is discussed under the following sections:

Product

CanGo Inc. deals with online entertainment market. Their services include online video, audio, reading and gaming. Since level of competition is high in the market, CanGo Inc. will have to show a high degree of innovation in their services. It will have to come up with newer ideas that are not yet provided by other businesses. Gaming services provide a lot of room for innovation. Like Zynga, CanGo Inc. can collaborate with social networking websites such as Facebook, and provide free social gaming experience. The edge that social gaming provides is that firstly, it allows immense scope to promote the company. Secondly, the gaming in general can be free but gaming rewards can be sold for cash that assist in faster progressions in game. People who are too much into gaming buy these rewards without any reluctance, provided that the game offers them unique fun experience.

Price

Since the online entertainment market is highly competitive, CanGo Inc. will have to keep low subscription fee as far as video and audio downloading is concerned. While some websites that provide pirated material offer the facility of free downloads, CanGo Inc. cannot afford to do that as piracy is illegal and providing legal material for free will reduce the firm's profits. The weak side of downloading free torrents is that it poses a high threat of viruses and Trojans. CanGo Inc. can play on this weakness by ensuring that it provides quality and virus and Trojan free material. Online gaming, in general can be offered for free, however, cash payments can be charged for sale of game rewards.

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Promotion

The best way to promote the CanGo Inc. services are by ensuring that the firm's official website appears in top search results of top search engines such as Google. This can be done by ensuring that the website's content is written using an excellent SEO language. The firm can also use social networking websites such as Facebook and other free gaming websites such as Miniclip.Com in order to promote its services.

Placement

The website will have to be easily accessible as well as searchable by the consumers. This can be done by ensuring that the firm uses a domain name that indicate the firm name along with the service that it provides for example www.CanGogames.com.

Financial Analysis

CanGo Corp. has survived well as far as financial aspect is concerned. It had not faced any cash flow problems so far. Initially, the gearing ratio was a bit high but with a low payback period of just two years, it managed to control the gearing. Proper management of weak areas can result in improved sales and reduced costs which will result in higher profitability. Although the business did not seem to have any cash flow shortfalls, the Current Ratios were consistently less than 1. This needs immediate attention as a current ratio of less than 1 would mean that the business can face serious cash flow problems in future. Gross Profit Margins of CanGo Inc. have been consistently very high, however, the Net Profit Margins are much lower in comparison to that. This is primarily due to high interest and tax payments. While taxes are out of the firm's influence, CanGo Inc. must try to reduce on interest payments on loans as a low net profit margin would mean that the profits contribute less to per unit of sales.

The financial statements of CanGo Inc. are given as follows:.....

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