Download pptx - Revitalizing a product line using the Value Innovation Process

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Schwinn Cardio Product Line Case Study

Jake Petersen, Director NPD, Nautilus

Copyright Value Innovations, 2004-2013 All rights reserved 2

BackgroundMarch, 2012: Directors of PD and PM attend an MVI Workshop

May, 2012: Director of PD attends the first MCI Workshop

June, 2012: Sales of Schwinn Upright Bikes are declining Decision made to set up a project and use the VIP

Copyright, Value Innovations, Inc 2004-2014 All rights reserved 3

150 Upright Stationary Exercise Bike

Fully Adjustable Perimeter weighted flywheel Quiet magnetic ECB resistance system 16 resistance levels

Two other models: 170 and A10


Objectives Increase market share of retail Schwinn

Cardio Product Line What will it take to win in this highly

competitive market? Primary focus on consoles

Introduce the Value Innovation Process® to Nautilus

Uncover customer insights that can be leveraged on other products

Project Definition


Deliverables “To Be” value curve from the perspective of

the most important customer (MIC) Elements ranked & compared to “Best in

Class” Plan for “HOW” to deliver on “To Be” value

curve elements

Project Definition


Project Kick-off: 6/5/12Round 1 Interviews: 6/19/12Round 2 Interviews: 6/26/12Round 3 Interviews: 7/17/12Recommendations: 7/27/12

RKL Note: VIP cycle time, 7 weeks!!

Project Definition

Value Chain

8Copyright, Value Innovations, Inc 2004-2014 All rights reserved

Nautilus

Amazon

Consumer

Sporting Goods Store

Consumer Consumer

Value Chain

Copyright, Value Innovations, Inc 2004-2014 All rights reserved

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3 Questions to identify the Most Important Customer

1. Who has to fix the problem?

2. Who loses financially?

3. Who sees the Value?


Who has to fix the

problem?

Who stands to lose

financially?

Who sees the Value?

Amazon X XSporting Goods Company X

Dept Merchandiser X X

Buyer X

User/Consumer X X XXX

The 3 Question Template

11Copyright, Value Innovations, Inc 2004-2014 All rights reserved

Nautilus

Amazon

Consumer

Sporting Goods Store

Consumer Consumer

Value Chain

Up until March, 2012 Nautilus talked exclusively to Buyers

In June, 2012 Nautilus determined Users/Consumers were the Most Important Customers

Value Curves


“As Is”

Low High# Programs

# Programs

IpodNo = 0, To Speakers = 2.5, Data = 5

SpeakersNo = 0, Yes = 5, Premium = 7.5

ConnectivityNo = 0, USB = 5, W ireless = 10

FanNo = 0, Yes = 5, Premium = 7.5

Console Looks1-10 Subjective

Screen SizeSmall = 2.5, Med = 5, Large = 7.5

Interface1-10 Subjective

TrackingNo = 0, Yes = 5, Premium = 7.5

Reading Rack1-10 Subjective

BrandNLS Survey PM '11 Unaided %

0.0 2.8 5.5 8.3 ##

1

2

3

4

5

9

10

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Cardio ConsolesValue to Home UserNautilus FINAL

6

7

8

20

No

No

Yes

6

Small

No

7

20+

Data

Prem

Prem

8

Med/Lrg

Yes

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Schwinn 840 Best in Class

Contextual Interviews


Seven interviews conducted over a five day period for rounds 1, 2, and 3

Two participants were paired in each interview

Participants were located across the United States, owned a piece of cardio equipment, and worked out consistently at home

Interviews were conducted via the phone for rounds 1 and 2

Round 1 interviews were recorded and transcribed

Contextual Interview Details


Used Webex for round 3 interviews so that participants could see the concepts presented

Interview questions were sent out 2 to 3 days ahead of time

Participants were given a $100 gift card after the third interview

Contextual Interview Details

The New Products


“To Be”



Low High# Programs

# Programs

IpodNo = 0, To Speakers = 2.5, Data = 5

SpeakersNo = 0, Yes = 5, Premium = 7.5

ConnectivityNo = 0, USB = 5, W ireless = 10

FanNo = 0, Yes = 5, Premium = 7.5

Console Looks1-10 Subjective

Screen SizeSmall = 2.5, Med = 5, Large = 7.5

Interface1-10 Subjective

TrackingNo = 0, Yes = 5, Premium = 7.5

Reading Rack1-10 Subjective

BrandNLS Survey PM '11 Unaided %

0.0 2.8 5.5 8.3 ##

1

2

3

4

5

9

10

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Cardio ConsolesValue to Home UserNautilus FINAL

6

7

8

20

No

No

Yes

6

Small

No

7

Speakers

Prem

Prem

9

Lrg

Yes

7

20+

Data

Prem

Prem

8

Med/Lrg

Yes

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Schwinn 840 To Be Best in Class


Primary Upgrade: Over-sized console with 26 total programs including a second displayAdditional Upgrades for the User:

Second console display MP3 music input port Speakers Console fan Water bottle holder Transport wheels Extra-wide seat Oversized pedals with toe straps Comprehensive warranty coverage


1’ 33” Videohttp://www.amazon.com/Schwinn-100336-170-Upright-Bike/dp/B00D4LEEYA/ref=sr_1_1?s=sporting-goods&ie=UTF8&qid=1384297188&sr=1-1&keywords=schwinn+170+upright+bike

http://www.amazon.com/Schwinn-100336-170-Upright-Bike/dp/B00D4LEEYA/ref=sr_1_1?s=sporting-goods&ie=UTF8&qid=1384297188&sr=1-1&keywords=schwinn+170+upright+bike







The New Products


What’s Happened?September, 2013 - Introduced: 3 Upright Bikes A recumbent bike An elliptical October, 2013 User feedback from Amazon..very positive 150 suggested retail price, $499. Offered

at $299 Sales up dramatically


What’s Changed?Nautilus:Now doing face-to-face interviewsUse Value Curves on all projects even if the project is not going through the VIP