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Simulation Reflection Report

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Introduction

This reflection report seeks to delve into the learning experience and strategic decision-
making processes during an intensive, multifaceted market simulation exercise that
spanned ten weeks. The simulation, centered on product management in the retail
sector, presented a dynamic and evolving marketplace where we navigated through
fluctuating customer preferences, production costs, retailer policies, and shifting market
segments. Our chosen product—a backpack—offered the opportunity to explore varied
market segments and tweak the product's features based on our intended customer
demographic. The objective was to optimize our sales and profitability, refine our
product offering, and enhance our distribution strategies.

Each decision throughout this journey was not taken lightly, as the immediate feedback
from the simulation presented the opportunity to learn in real-time and make necessary
adjustments. The simulation compelled us to think critically, respond promptly to
changes in market conditions, and anticipate future market trends. This report reflects
upon the strategies implemented, the results achieved, the complexity of the simulation,
and how our decisions evolved over time. It serves as a detailed chronicle of our
progression from week to week, tracing our learning curve, decisions, and outcomes,
ultimately showcasing the invaluable insights garnered from this immersive learning
experience.

Weeks 4-6: Product Modification and Price Adaptation

In the inaugural weeks of the simulation, our team was committed to grasp the
complexities of the game, focusing on developing our understanding of market
dynamics, consumer preferences, and competition. Simultaneously, we embarked on
product development and market penetration strategies, aiming to carve out a niche in
the crowded market. The product, an eco-friendly water bottle, was custom-designed,
with the target market being university students - a demographic deemed both
environmentally conscious and health-aware. We believed this specific target group
would appreciate a product that reflected their values and daily needs. From the very
beginning, we positioned our product as not just a commodity but as a symbol of

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sustainability and awareness. This involved not just selling a product but an idea and a
way of life.

The fourth through sixth weeks of the simulation brought with it new complexities and
challenges that tested our adaptability and strategic decision-making abilities. The onset
of week 4 was marked by a combination of anxiety and excitement as we embarked on
a new strategy: targeting urban commuters with a rounded top, wide padded backpack,
priced at $59. This strategy emerged from rigorous market analysis and the
identification of urban commuters as a potential target demographic with high buying
power and influence (Walker et al., 2020). Reducing the retail chain's share from 50% to
40% was a strategic move aiming to stimulate sales by decreasing retail costs, thus
achieving a higher profit margin. The complexity of the decision process was palpable,
and it was a real test of our capacity to balance cost, price, and profit margins.

Our product received mixed responses. With 349 sales and a 41% market share, we
were initially thrilled by these positive numbers. But our spirits dampened with the
negative feedback regarding the material used and the high production cost. This
feedback was a stark reminder of the importance of customer preferences in shaping
our products, highlighting the need to consider not just price points and market shares,
but also customer satisfaction. We realized that creating a successful product was a
much more complex task than simply identifying a target market and an attractive price
point—it also required a deep understanding of customer preferences and expectations.

In week 5, the simulation threw us a curveball: a 20% increase in the production cost of
square and large rectangular backpacks. This unforeseen situation was a reminder of
the unpredictable nature of business operations and the market environment. We
quickly regrouped and pivoted our strategy. Taking into account the environmental
consciousness trending among consumers, we introduced an eco-friendly backpack to
the university student demographic, priced at $49. The lower price was a calculated
risk, aiming to generate increased sales volume to offset lower margins. This time, our
decision-making was more nuanced, incorporating the lessons learned from week 4.

Feedback regarding the color and price of the new product was a mixed bag, but sales
and profitability improved, validating our strategy. We realized that it wasn’t always

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about avoiding criticism, but rather, about understanding the trade-offs we were willing
to make to achieve our objectives (Walker et al., 2020). The complexity of the situation
brought us both stress and fulfillment. Seeing our revised strategy succeed despite the
criticism was gratifying, serving as a testament to our capacity to adapt and make sound
decisions under pressure.

Week 6 marked our first venture into print advertising. We hypothesized that this
approach would improve product visibility and sales. Indeed, the resulting positive
impact on sales and profitability was encouraging. We felt triumphant, having
successfully leveraged a new promotional channel. However, we quickly found that the
market is not static, but an ever-evolving entity. A shift in consumer preference towards
durability presented us with a new challenge, revealing the multifaceted nature of
consumer preferences and the importance of constantly updating our understanding of
the market.

In retrospect, weeks 4 through 6 of the simulation were a roller coaster of emotions and
learning. The complexities and intricacies of the decision-making process revealed
themselves more and more each week, challenging us and pushing us to grow. The
simulation reinforced the interconnectedness of different factors and the need for
holistic thinking when making strategic decisions. It was a profound experience, one
that has imprinted on us the importance of flexibility, adaptability, and a deep
understanding of market trends and consumer preferences in business strategy.

Weeks 7-10: Channel Optimization and Price Escalation

The latter half of the simulation—weeks 7 through 10—brought with it additional layers
of complexity. This period was characterized by a focus on optimizing distribution
channels and escalating the price of our product based on market feedback.

The beginning of week 7 was marked by the anticipation of the results of our previous
decisions. We saw our strategic adjustments beginning to yield positive results. The cut
from the retail chain was further decreased, and despite an increase in the production
cost of hemp, there was an encouraging uptick in sales and profitability. This period
underscored the importance of continuous product and strategy refinement (Walker et

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al., 2020). It taught us that dealing with fluctuating costs was a necessary aspect of
managing a product line, requiring ongoing assessments and swift adjustments.

As we transitioned into week 8, the simulation continued to challenge our adaptability.

The rise of online shopping significantly influenced our strategy. While we continued to
sell our eco-friendly, university-themed water bottle, we expanded our sales channels to
include online discount retailers. We also increased our emphasis on social media
advertising, understanding its significant influence on today's consumers. These
decisions yielded a noticeable improvement in sales, profitability, and market share,
reaffirming our belief that adapting to changing retail landscapes is essential for
success.

Weeks 9 and 10 brought a new dimension to our strategy: price escalation. Guided by
feedback that university students were willing to pay more for backpacks, we gradually
increased the price to $61 and then to $62. This decision was a testament to the
importance of customer feedback in shaping business strategy. We were thrilled to see
this price escalation resulting in a significant boost in sales and profitability. It taught us
that understanding our target demographic's purchasing power and willingness to spend
could unlock new opportunities for growth.

However, our satisfaction was tinged with caution as we noticed a slowing growth rate
in the luxury trend-follower market segment in week 10, decreasing from 7% to 5%. This
observation served as a reminder that market trends could shift rapidly, and strategic
adjustments were necessary to maintain our upward sales trajectory. It was a sobering
reminder of the dynamic nature of the market, prompting us to continuously re-evaluate
and adapt our strategies.

Reflecting on weeks 7 to 10, I found the simulation to be an enriching learning journey.

The increased complexity of the scenarios not only honed my decision-making skills but
also deepened my understanding of the intricate dynamics of product management. It
underscored that success in a volatile market environment relies on our ability to quickly
interpret changes, make informed decisions, and adjust strategies accordingly.

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In conclusion, these final four weeks provided invaluable insights into the multifaceted
nature of the market. The interplay between consumer preferences, production costs,
retailer policies, and shifting market segments significantly influenced our strategic
decisions. Moving forward, I am confident that these experiences and insights will guide
our team as we navigate through the real business world, facing challenges with
resilience, adaptability, and a deeper understanding of market dynamics.

References

Walker, OC, Gountas, JO, Mavondo, FT & Mullins, JA 2015, Marketing strategy: a
decision-focused approach, 3rd edn, McGraw-Hill, Sydney.