TEAM 4 – Mar keting Plan VERTU 26.03.2017 [615382]

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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TEAM 4 : Valentin Boc, Imola Cojocaru, Marcel Flaugnatti, Oana Marinescu,
Laszlo Szabo, Florin Tulcan, Adriana Elena Valasutean
Marketing Plan VERTU
26.03.2017

CONTENT
I EXECUTIVE SUMMARY 1
II SITUATIONAL ANALYSIS 1
2.1. Competitive analysis 1
2.2. Market Trends 3
2.3. Key Market Segments 4
2.4. PEST Analysis 6
2.5. SWOT Analysis 8
III MARKETING OBJECTIVES 9
IV MARKETING STRATEGIES 9
4.1. Product St rategies 9
4.2. Prices 10
4.3. Places 11
4.4. Marketing & Communication Strategy 11
V RESOURCES –PEOPLE/FINA NCIAL S/TIMEPLAN 12
5.1. Employees 12
5.2. Financial 12
5.3. Time plan 16
VI MONITORING INIDCATORS 16
VII CONCLUSIONS 16
VIII REFERENCES 16
VIII APPENDIX 1 – FULL -LINE PRICING VERTU 18

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I. EXECUTIVE SUMMARY

Vertu is a unique luxury brand specializing in segment of luxury mobile phones, targeting high
net worth individuals. Vertu’s phones are made by one person for one person, utilizing craftsmanship,
precision engineering, high end technology and unique personal servi ce. The first mobile phone was
sold in 2002 and its prices ranges US$ 6000 – 200 000. Vertu sells worldwide its phones via chain of 90
Vertu boutiques and over 500 retail partners.
From historical prospective the company was founded in 1998 as pilot projec t by Nokia. In 2012
Swedish private equity firm EQT purchased the company and changed its operational system from
Nokia’s Symbian to Android. In June 2016 Chinese company Godi Holdings acquired Vertu to
eventually sell it in March 2017 to an exiled Turkish businessman Hazan Uzan. In Romania Vertu
entered in 2008 via retail jewelry /watches chain Cellini and its currently selling its phones in 6 different
locations operated by 4 independent retailers.
Vertu recognizes Romania powerful potential clients’ base of approx.. 11 000 US$ millionaires,
but in the same time low brand awareness and no strategic marketing approach to this market. There for
Vertu ’s main marketing goal for Romania market is to expand brand presence and come closer to its
clients. This sha ll be achieved by launching its first unique Vertu boutique in Romania resp. in Central
– Eastern Europe and by range of marketing activities, thus offering its customers complete and newest
range of products a nd complete services experience. The first sto re shall be opened in Timisoara or
Cluj Napoca.
Marketing plan estimates opening its own store will bring sales of approx. 600 pcs yearly (plus
accessories) , with estimated sales of more than 8,500, 000 Euro (smaller in first year due to opening
related top ics – store fit-out works and entering new in the market) . The opening of the store is
estimated to happen in less than 3 months after renting, with a rental cost of about 150000 euro/month ,
and marketing activities shall cost 1,540,000 euro. Overall opera tional cost for store management are
estimated to be around 3,500 ,000 (around 10% bigger in the first year) with EBITDA of 3,250,000
euro at the maturity (starting with second year) . Opening its own store assumes also establishing legal
entity and employi ng approx. 10 people on a permanent basis.
One of the unknown issues is what strategy and changes will be implemented by new fresh owner
of Vertu and its impact on Romania. The other potential challenge is Vertu ability to appeal not only by
craftsmanship and services, but also by offering up to date advance mobile technology for its luxury
phones. Typical operational problem may appear is ability to hire skilled sales people and retain them
on long term basis, which with up to 70% employee fluctuation in r etail industry maybe a great
problem.
We expect that opening its own store, offering full range of products and complete concierge
services supported by marketing activities in next 3 years will significantly increase the brand
awareness and number of Ver tu clients Romania . On the other hand we don’t expect any new
competitor to enter Romania luxury mobile phones market . This marketing plan includes analysis of
market, Vertu brand in Romania and offers plan of steps for next year.

II. SITUATIONAL ANALYSIS

2.1. Competitive analysis
Vertu is the name that created the world's most exclusive personal communication instrument 1
– it was very soon followed by other smaller companies that are producing very expensive mobile
phones “with a twist” . The luxury portabl es market addresses to a niche of customer interested more on

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the hardware of the phone rather into the software and technical options. The most prominent direct
competitors are Mobiado, GoldVish and GRESSO.
Mobiado was started in Vancouver, Canada by Pete r Bonac, a physics Engineer. His motto for
his creations is the Engineering Art. Using engineering principles such as straight lines, perfectly
flat surfaces, and circular buttons, Peter Bonac was able to transform mobile phones into Precision
Mobile Instr uments. This is the same technology used for producing precision parts for the
aerospace and luxury watch industries; for unbelievable accuracy and allowing for precision of up
to 0.001mm2.
In Europe, Mobiado mobile instruments are sold through 5 locations – France, Germany, UK
and 2 in Russia, one of them covering also the Baltic and CIS region
Every year since 2004 Mobiado was the name that created the first mobile instrument with a
specific material or technology:
 2004 Professional was the first CNC mach ined phone to be created from aircraft
aluminum.
 2005 Professional EM was the first exotic wood phone to be produced.
 2007 Luminoso was the first phone to use sapphire crystal buttons and the first 3G
luxury phone.
 2008 Professional 105 GMT was the first m echanical watch phone.
 2009 Grand 350 PRL was the first 3.5G and full keyboard luxury phone and the
first phone to use mother of pearl.
 2009 Grand 350 Pioneer was the first phone to use meteorite.
 2010 Classic 71 2MG was the first phone to be created fro m Mokume Gane.
 2010 Classic 712 MG Angular Momentum Edition was the first phone to incorporate
Verre Èglomisé, as well as the first phone to be sold with matching wristwatch
 2012 Grand Touch Executive was the first phone to use a SIM card mechanism and the
first to be created from a stone hybrid material
 2015 Professional 3 ML was the first lumi nous phone using Super -Luminova2
GoldVish is a Geneva based company Founded in 2003 in La Chaux -de-Fonds, within the
heart of the Swiss watchmaking industry, Goldvish was inc orporated by a creative team with
extensive track records in watch design and technology, with a company mission to create unique
and exquisite masterpieces .3
In Europe GoldVish can be purchased online and through selected distributors.
As Mobiado is “the first to “, GoldVish has also earned the title of “the most “expensive mobile
phone in 2016 with the model “Le Million” PIECE UNIQUE4 and was also the first to incorporate a
mechanical chronograph.
Other names on the market are Gresso – mobiles produced w ith special Swiss clockwork
mechanisms or AEsir – its first mobile being designed by Yves Behar.
Another type of competition however comes from cobranding and the special items created by
the existing mobile phone Apple, Sonny Ericsson5; on the luxury fash ion, car brands, and wristwatches.
Prada partnered with LG to produce a high end mobile, Christian Dior, Aston Martin, Lamborghini are
famous names that associate themselves with the luxury mobiles also.
As soon as Vertu was followed on the market by Mobi ado, Gresso, GoldVish the question about
the market share also occurred. Will Vertu loose its market share?
If we take a look at the specifics of Mobiado – the main competitor – they are using a different
perspective, they are selling the traditional – the family generation story, the European heritage, the
investment in tradition6.

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Also, the company is using a very antagonistic approach towards the market trend in term of
design that can work against them and the same rigid approach on the items customizat ions limiting the
already short niche of customers6.
On the other hand Vertu has no constant real threat of substitution as the production of luxury
phones is very limited on the competition side – one of the main assets being the powerful R&D
existing tea m that makes possible the utilization of precious materials while Mobiado had a few
technical problems with the Mokune Gane6.
The path that Vertu has chosen says “ Evolutionary Technology” so it is fair to say that the
company is creating its own niche – rich, open to new designs, cutting edge technology. And the
company is there to offer its client a large range of complementary high end services: customization,
concierge service, private club and networks membership.
Concerning the specific Romanian market Vertu is already present through luxury retailers since
2008 in 6 locations in 2 important cities, Bucharest and Constanta. Mobiado has made some headlines
in 2012 when it was announced its entrance on the Romanian market through Resonor and allegedly
sold 30 devices in 6 months7. There are no other data available on the continuation of the plan,
financia l information about the retailer are available only for 2012 turnover of EUR 46 K and a
negative net profit of EUR 5 K8.

2.2. Market Trends
2.2.1. Luxury good s in Romania
a) Luxury goods are expected to grow at single -digit growth rates as the middle class in
Romania is far from disposing of an income that can sustain purchasing luxury goods. Since Romanian
society and the economy would need to go through an unrea listic radical change, luxury goods are
expected to remain static9 .
b) Phenomenon observed is whereby international brands periodically launch mono -brand
stores to take a part at the second largest market in Central Eastern Europe, only to run deficits for a
couple of years and subsequently realize that it is simply not profitable to operate luxury brands in
Romania. The result is a disappointing exit of the respective companies.
c) The 2 most developed luxury markets in Romania are fashion and beauty. The best
performing luxury fashion brands in Romania in 2015 were Louis Vutton, Dolce Gabanna, Burberry
and Gucci. The best-selling luxury watch brands in 2015 were Rolex and Omega.10
d) In first 2 months of 2016 almost 600 new luxury cars have been registered, regis tering even
50% growth compare to 2015, especially Porsche, Lexus, Jaguar, Maseratti, Cadillac and Bently11.
e) There are few luxury brands mono -stores and some privately -run multi -brand stores in
Romania. However these are not necessarily profit oriented, b ut rather run by wealthy persons out of a
personal interests. Luxury brands are mostly present in Bucharest12.
f) The factors which can influence the recovery of the luxury markets are: overall recovery of
Romanian economy and the shift towards a different c onsumer target: the “upper” middle class, rather
than the “ultra” rich. An additional step could be revival of Bucharest as a tourist destination as well as
Chinese residents in Romania who mostly run import/export businesses and wealthy consumers from
Republic of Moldova.
g) Since purchasing luxury goods is an experience rather than a necessary transaction, offline
sales dominate by a large margin. Online sales are existent but consumers turn to international not
domestic websites to order the most recent pro ducts. Online channels are largely used for promotional
activities as are luxury magazines since advertisements need to be targeted precisely to a minuscule
consumer base12.

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2.2.2. Luxury Mobile Phones in Romania
h) First official dealer of luxury phones became luxury watches/jewelry retail chain Cellini, in
May 2008 when it started to sell luxury phones Vertu. Its competitor Mobiado entered Romania market
in April 2012 via retailer Resonor had sold in first 6 months 30 phones. There are no further data
available found13.
i) In the year 2017 Vertu as per Vertu.com has 6 locations in Romania, out of which 5 in
Bucharest and 1 in Constanta . All are re -selling points, Vertu does not have its own store in Romania.
In a Business M agazine interview , in april 2009 , with the director executive of MediaMax Center, he
estimated sales of roughly 1000 Vertu phones per year14.

2.2.3. Romania economy
j) Number of Romanian millionaires grew in 2016 by 3.7% vs 2015. At this moment its
estimated 1 1200 millionaires in Romania15.
k) Romanian economy has been growing recent years, having low inflation and unemployment
rate.
l) As per a market study in 2013 – Romania was on the 2nd place under the East European
countries whit consumers who are buying constant luxury products and they have a strong attraction to
premium brands.

2.3. Key Market Segments

2.3.1. Demographic criteria
A. Income and activity domain:
As a luxury brand (with the price per unit exceeding 10.000 Euro), Vertu brand is addressing
consumers with above average income level s.
According to Ziarul Financiar16, in 2014, there were almost 125.000 Romanian people with a
salary over 10.000 Ron (around 2200 Eu) – more than half of them located in Bucharest.
Also, according to another online journal (Jurnalul.ro)17, the top 10 salar ies in Romania in 2015
were:
No. Title Monthly gross salary Field of activity
1. Football player 142.129 Lei (35.532 $) Sport activities
2. Football player 142.129 Lei (35.532 $) Sport activities
3. Football player 141.544 Lei (35.000$) Sport a ctivities
4. Project manager 140.000 Lei (34.589$) Custom -made software
5. System engineer 140.000 Lei (34.589$) Custom -made software
6. Professional development inspector 139.722 Lei (34.930$) Professional organization
7. General Manager 138.359 Lei (34.589$) TV&film distribution
8. Manager 134.053 Lei (33.513$) TV&film distribution
9. PR Specialist 132.997 Lei (33.249$) Alcohol&tobacco
distribution
10. System programmer 131.092 Lei (32.773$) Telecommunications
Other sources are mentioning the following occupations, as top salary generators (with
maximum monthly level of 36.700 Euro/month): football player, leasing company manager, waste
collection expert, engineer, telecom manager, commercial company executive, 2 other football players,
system engineer18.
On the other hand, according to Capital Journal in 2016 there were 10.800 US dollar
millionaires in Romania. There are no statistics available about the source of the money of all the
Romanian $ millionaires, but according to th e above top salaries, there is little to 0 chance that any of

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them became millionaires without, at least, reinvesting their salary incomes in some sort of
entrepreneurship. Even the people with independent professions like lawyers or architects that are
inside the millionaire category, are most likely to have reinvested their original incomes to other types
of activities in order to reach such fortune level19.
Therefore, the target customer for Vertu will include the 10.800 US$ millionaires from
Romania plu s the people earning salary levels above 10.000 Euro per months, with focus on the
following jobs: football (soccer) players, IT & telecom industry managers, financial services
company managers, entertainment industry managers.

B. Location
The top 10 coun ties in Romania based on the average salary levels, in descending order, are:
Bucharest, Ilfov, Cluj, Timis, Arges, Gorj, Prahova, Iasi, Sibiu and Brasov20. Therefore, the first
targeted cities, in this order, are: Bucharest, Cluj -Napoca, Timisoara, Pites ti, Targu Jiu, Ploiesti, Iasi,
Sibiu and Brasov.
Other sources) , indicate a slightly different order: Bucharest, Cluj -Napoca, Timisoara, Brasov,
Constanta and Sibiu – as for the „richest” cities in Romania21.
All sources agree that Bucharest, Cluj -Napoca and Timisoara are top 3 and therefore, the
starting point for Vertu in Romania will target customers near or from these 3 cities.

C. Age&gender groups
As the product group is somehow similar, we looked at a study regarding the IPhone consumer
according to these 2 criteria: age and gender (see image below). The conclusion is that the most
important target should be: men, between 35 and 65 years old.

Source: CNN – Tech22
Alice Mihai ( Business Development Director, ISRA Center) stated in 2012 on Luxury &
Aspirational Brands forum organized by SMARK KnowHow that people who are planning to buy
luxury products :
47% are from the Generation X (32 -47 years old, active professionals, married, are
using internet in daily basis, analytical and pragmatic persons with a high education level)
37 % are from the Generation Y (18 -31 years old, “obsessed by the technology, self-
focused and self-inventive , people who like diversity, not married, education level middle to high)
and 16% are Baby Boomers (48 -64 years old, married with an average education level.

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Even if they don’t have at this stage the necessary budget, the next generations of the luxury consumers
are younger persons who are sophisticated and well informed about the global situations/
developments/ trends23.

2.3.2. Mental models
Benefit segmentation
One of the most important criteria for this type of brands (luxury brands) are the „emotional
benefits” of the products, like: financial/social status indicator and unique -ness.
Therefore, we will need to tar get buyers that search for the above -mentioned benefits.
One good way is to look among other luxury brand customers from Romania, like: Porsche (197
units sold in Romania in 2016 according to Luis Vuitton, Gucci , Burberry, Rolex (all 4 brands
present on Ro manian market), etc24.
As Porsche is a brand which needs to have a slightly different marketing mix due to the nature of
the product, an easy approach is to identify the places where the other 4 above mentioned brands are
already selling and try to select similar environments for Vertu.
All 4 of them are located in very exclusive areas in the city centre of Bucharest, 2 of them inside
Marriott Hotel (one of the most expensive hotels from Romania) – a good idea for first future Vertu
location, as also Marri ott Hotel is considered a status indicator for the people who are spending their
time here.

Conclusion
The target Vertu customer in Romania is a male with age between 35 and 65 years old,
located in one of the top 3 by income cities from Romania (Buchares t as first choice, Cluj and
Timisoara), either a US$ millionaire, either earning a salary over 10.000 Euro per months,
mostly from the following jobs: football (soccer) players, IT & telecom industry managers,
financial services company managers, entertain ment industry managers.

2.4. P.E.S.T. Analysis

2.4.1. Political
From a political standpoint the instability and inconsistencies of the alternating regimes in
Romania do not provide the best shelter to a growing business. Driven by populism, law makers and
regulators in Romania have a proven tendency to shine the spotlight on to luxurious products and
invent various way to “punish” the bold enough corporations or entrepreneurs who dare display
opulence in a developing country, as an example of center -left pol itical affinity and expression of the
socialist legacy.
2.4.2. Economical
In Romania, the bill that testifies the best to the adversity of the fiscal and finance crowds
towards luxury goods are the following:
taxation on land for houses that come with a s wimming pool (regardless of size) are taxed
more than double even though have similar square meters of others;
jewelry statements owned or held by any public or state employee, are routinely checked and
cross referenced to the income level and financial po tency of their holders, similar for the any art
objects or rare items such as paintings, lamps, sculptures, books or artefacts that have a different
formula of taxation that for any other goods;

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2.4.3. Social
The split of the financially potent populat ion among those who can afford a Vertu phone in
Romania has to be done between those people who have a solid education, cultural awareness and the
sophisticated upbringing in order to cherish a product like Vertu, whereas there is the other end of the
spectrum – the majority – that are fas t, overnight money. T hese percentages are somehow 73% in favor
of the latter category in detriment of the former, classier audience, only 27%25. This assessment was
carried out considering notoriety and extent of education , surveys upon lifestyle and personal habits,
trips and vacation alternatives as well as free time or general social interests to differentiate between
one category or another.
Bearing this in mind, the aim should be to customize the Vertu phones in such a way in order to
appeal to “new money” segment. These would be the ones that are most likely to buy and/or
upgrade/replace their phones with the Vertu phone because nothing states I am well off financially than
this phone in any social encounter.

2.4.4. Technological
Romania is a country where IT ingenuity and human resourcefulness combines harmoniously
with innate curiosity and constant seeking of new and improved gadgets or software services from
various suppliers. Creating a troubleshooting center in Romania for Vertu’s both software and
hardware part would be of immense utility to the company. Although Nokia was trying to keep Vertu at
arm’s length through -out its lifetime it is clear that a more closer base for repairs, substitute
components and or s oftware installations that cannot be done remote, would facilitate far less operating
charges and logistic costs for the phone s that have to travel all back to England.
Co-branding these interventions with the likes of Catalin Botezatu’s image – fashion celebrity in
Romania – that could leave his print on the new and improved Vertu phone would probably mean the
world to Romanian nationals and thus enhance their fidelity for the brand retain them as viable buyers
of the new products.
Another facility that could be incorporated in the devices designated for the Romanian market
would be an add -on to the concierge feature in terms of extending the NFC capabilities of each device
in order to immediately notify its owner of another Vertu user in case of proximit y. The Romanian
potential consumer of the Vertu brand would love the idea of networking with others such as
him/herself that holds the same status and frequent the same high -end places, without the effort of
having to interact extensively, thus maybe expos ing him/herself to unwanted publicity.
Ideally every Vertu user in Romania could be hooked up to an internal network that would serve as any
type of social network, complex profiles required for the users and that would be readily available to
other users by means of the improved NFC technology when and if they are in each other’s vicinity in
country or abroad. Of course these features can be fine -tuned locally in Romania, only the hardware
product being hand -made in England.

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2.5. SWOT Analysis

VERTU SWOT ANALYSIS

No. STRENGTHT WEAKNESSES OPPORTUNITIES THREAT
1. Passion,
Tradition,
Innovation Phone application
have become
outdated
To carry out more research and
development software and design
innovation using Romanian IT
professionals and sell as from
Romanians -to-Romanians Lack of image and
brand awareness
within Romania

2. Strong brand
image in luxury
market Limited
touchscreen models
and 4G capabilities Maintaining focus on sustaining
current phone model in the niche
market Numerous
competito rs both
on smartphone and
luxury products
segments

3. Inspired to create
something unique,
of exceptional
quality, from the
rarest, most exotic
and robust
materials Limited decision
power on the
market since was
acquired by Goding
Holdings Organize “theme phones” such as
Brancusi phone or Florin Piersic
phone, etc.. using either
emblematic Romanian figures of
value from the past or live people
to advertise the phone. Hold
auctions every 6 months and start
the bid at 5 times the price of a
normal online -sold Vertu phone. Underdeveloped
software – not yet
reached full
potential

4. Exclusive
customer service
to Vertu owners,
like Concierge Low volumes
despite more
demand is present
in the luxury
market segment Expansion on the exclusive
customer experience – NFC
technology for other user
encounter. Products being
counterfeit – easy
to fake because
emphasis mostly on
design and material
rather than
specifications –
5. Customer loyalty
–those who value
innovation and
independence
Limited
information about
target consumer
habits regarding to
luxury products in
Romania. .Increase brand awareness by co –
branding with Tiriac Auto, many
fancy cars and use Mr. Tiriac as
Romanian ambassador for Vertu No existing shop in
the Balkans –
actual boutique.
People might prefer
going to
competition that
has shops readily
available.
6. Sufficient
shopping malls
located
strategically
through -out the
country that can
partner with Vertu
Romania and
advertise it or run
teasing
campaigns.
–

–
–

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The above SWOT analysis is deriv ed from the P.E.S.T. analysis only to convey and strengthen
the mission of our Romanian subsidiary and achieve the stated objectives.

III. MARKETING OBJECTIVES
Expanding the Vertu brand presence in Romania Market by focusing on offering complete
experience an d services to Vertu customers. Our main goal is to sell 600 phones via own Vertu
boutique that will be opened in Timisoara or Cluj – Napoca
Increase earnings to about 600* 13300 Euro (phones ) + 660 * 1300 (phone cases) = 8,838,000
Euro.
Divers portfolio a nd create new val ue using in country resources for Romania and adapt devices
to consumer specific needs.

IV. MARKETING STRATEGIES

4.1. Product Strategy

Promote the entire range of products , already existing in the Romanian dealer’s portfolio
https://www.vertu.com.ro/ and especially on newest models with up to date high technical
characteristics, resp. avoid selling models which don’t keep up with modern technology basics .
The reason for doing this is that for the mome nt we do not have enough details in order to make
clear analysis on the specific taste of the Romanian market. One big issue, as many seller of luxury
good from Romania already noticed, is that the Romanian consumers prefer to buy from outside the
country26, because of larger product range offered.
That is why is very important to bring the entire portfolio as it will attract different segments of
consumers for the different collections.
Focus on the entire Vertu experience – Vertu Life, Vertu Concierge, Ve rtu Certainty that are
bringing the luxury of the Vertu and adapts itself on the owner’s specific life style27
Introduce concierge service in Romanian language

4.2. Price
As Vertu is a luxury brand and considering that our target -customers are rich and very r ich people
(see Market segments and target market), our pricing strategy will include the following approaches:
non-price competition , prestige pricing and f ull-line pricing
4.2.1. Non-price competition
Vertu is not selling a mobile phone but a unique expe rience. Therefore, we do not target to align
our prices to any competition but to offer an extraordinary outstanding mix of benefits, with no
limitation for the final price. We are selling together: a phone, a 24h personal assistant, multiple
benefits and exclusive access opportunities “to private members’ clubs and closed -door shopping
experiences” (www.vertu.com) and last, but not least we sell status symbol and acknowledgement
(which is priceless for many).
One important watch -out in this approach is to always be alert to changes in competition – not to
changes in price but mainly to changes in product and services in order to overcome the situation when
our product will be no longer unique and therefore this pricing approach will not work anymore. This i s

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why we will always need to invest in R&D and creative environments in order to always be able to
generate the best “uniqueness ideas”, which will solve yet unapproached needs of our customers.
4.2.2. Prestige pricing
We will control the price of our othe r distributors in Romania – which will need to be strictly
aligned to ours after we will launch our own boutique.
Our internet sales will be very limited: only a few selected products will be available online and
the distributors will not have the right to sell online.
4.2.3. Full-line pricing
As you will see in our pricelist further on, we will have 3 different collections – with different
price positioning: Signature (top), Signature Touch (Middle) and Aster (the lowest price range). Our
expectation is t o maximize the sales on the middle level (Signature Touch).
4.2.4. Price list and the numbers behind
In Appendix 1 is presented the full -line pricing for VERTU line for 3 different collections – with
different price positioning: Signature (top), Signature Touch (Middle) and Aster (the lowest price
range). Our expectation is to maximize the sales on the middle level (Signature Touch) with a market
mix high/middle/low: 30/50/20 [%]
In the bellow table a n average price decomposition is presented :
Price analys is example
Costs
related to: Direct related to product
costs Amount
(EURO) /
percentage Total
cost for
one unit: Average
sales price Average
Gross
margin Average
markup
Phone Cost of the simple phone €300 €3.000 €13.300 77% 343%
Cost of the fancy
materials €1.200
Manual assembly €300
Software €200
Total product cost of one
unit €2.000
Transport costs 10%
Concierge, Life services 30%
Case Average total product
cost f or one Case €220 €242 €1.300 81% 437%
Transport costs 10%
Indirect
costs All administrative costs
(minimum average
markup needed) 40%
(The informat ion from the table above is an assumption)
Comments:
For the distributors , the margin for the phones is 30% in average (hig h for such expensive
products) – which is also attractive for them to continue selling the products.
The mark -up for the accessories is higher, for Vertu and the distributors, and will have also
significant contribution for the profit s
Around half of the distributor mark -ups we expect to be transferred to our own administrative
costs when we will open our own boutique and the rest will be transferred to margin

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4.3. Place
Production of Vertu phones is made in Great Britain, in small vill age called Church Crookha m,
40 miles from London. Vertu headquarters is located in the United Kingdom with several offices
situated worldwide including: Paris, New York, Hong Kong and Singapore .
Distribution – currently:
– via 4 independent luxury watches & jewellery multi brand retailers , in total of 6 locations,
out of which 5 i n Bucharest and 1 in Constanza;
1 in luxury hotel Mariot , Bucharest
2 in shopping centers (Bucharest, Constanza)
1 airport Bucharest
2 street loc ations in Bucharest
The closest Vert u own boutique is located in Italy, city of Milan. From all proximity countries
Romania has the 2nd highest number of locations selling Vertu phone, after Poland which has 7, Czech
Republic 4, Bulgaria – Slovakia – Greece – Austria each have 1 retailer sel ling Vertu phones, Hungary
has none.
– Online orders are also possible via international Vertu website, www.vertu.com , where
customization is possible and delivery is around 7 -8 weeks.
Distribution – future:
– New channel t o be introduced – open VERTU own boutique in Romania , while keeping
distribution via independent retailers.
Location – exclusivist shopping center addressed mainly for the first segment and
brand visibility and the second location on an exclusivist busine ss location (hotel/villa/business
center)
Timing – finding and opening the store by end of Dec 2017 or beginning of Jan
2018
The added value in comparison to current distribution way for Vertu brand will
be:
Possibility to create typical Vertu atmosphere a nd emotions
communicate with clients directly
show entire range of products
control over the design and layout of this distribution channel, staff and
their training
Three cities are to be considered as candidates for first Vertu boutique – Bucharest, Cl uj
Napoca and Timisoara. Timisoara or Cluj Napoca would help to cover North West of the country and
have maximum coverage.

4.4. Marketing & C ommunication Strategy
Promotional activities:
Promotional activities shall focus on segment that can afford phone up to 25 000 EURO and the
one over 25000 Euro.
Promotional channels to be used:
1. Internet
Increase participation in targeted Highe profile digital magazines and social media.
banners every Saturday on the main 2 newspapers read by the segment 2
consumers (start ing 6 months before opening). The target is to double the number of websites and store
visits and increase sales with 15% – target segment over 25K

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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12

banners key words “diamonds, sapphire, yachts, exotic resort, art gallery, art
auction” – target over 25K
banners key words “designer bags, designer shoes, new fashion trend”
2. Press
articles 1/month about Vertu and Vertu collections (starting 6 months before
opening) on the most representative magazine – target over 25 K
1 page add on the first 3 magazines with the latest news in science, health &
living and high tech and auto – target over 25K
1 article every two months on the fashion magazines

3. Luxury events
Cobrand with major exclusive events in Romania, that attracts the most prolific figures in
fashion, l uxury auto and other industries, like Wolfgang Porsche, the heir of the Porsche empire, Klaus
Mangold, former President of the Daimler group and Frantz Rauch, the owner of one of Rauch brand28
Exclusive Annual Hunting Event from BALC in Romania
Presence t o art galleries
Presence to art auctions – see the most important players in the art market –
Artmark29
Presence to main social events
Create network with different exclusive clubs (Rotary Club30, Cigar clubs,
Business Women Associations31 )
4. Vertu new store launch event
5. Show biz – identify the trendsetters from the show biz industry that will represent the
Vertu image for selected customized models
Attract of the newly developed IT society – in Cluj -Napoca one in 25 people is working in IT
some of the bigger names are Endava32,EBS33, Betfair34,35, in 2014 the turnover in the Romanian IT
sector was 4 billion euro36.
Partnerships with the Engineering and Business schools in developing program for new
revolutionary technologies and marketing strategies.

V. RESOURCES –PEOPLE/ FINANCIAL/TIMEPLAN
5.1. Employees
Profile – main requests: experience in selling high end products or services with a specific
network portfolio. A number of 10 people will be hired. Will be negotiated 13 salaries, with a yearly
10% increase in the first three years.
The main responsibilities in the first year are to represent the Vertu brand and create strong data
base of potential Vertu customers. In this scope a specific budget will be allocate in order to cover the
expenses:
Presence to ar t galleries
Presence to art auctions – see the most important players in the art market – Artmark29
Presence to main social events
Create network with different exclusive clubs (Rotary Club30, Cigar clubs, Business
Women Associations31 )
5.2. Financial
From the financial point of view, we have estimated the sales in the first three years, with a
reasonable ramp up curve in the first year and a slight increase year over year.

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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14
Below is presented the budget for the first 36 months, where we can see besides the sales, the
main costs considered and also the EBIDTA.

average phone cost mix Romania: 3000 Euro
Fiscal year 1 2018 average case cost mix Romania: 220 Euro
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Totals
Sales phones [Euro] 0 0220,950 441,900 589,200 736,500 662,850 441,900 662,850 736,500 736,500 883,800 6112950
Sales cases [Euro] 0 0 21,450 42,900 57,200 71,500 64,350 42,900 64,350 71,500 71,500 85,800 593450
Total sales [Euro] 0 0242,400 484,800 646,400 808,000 727,200 484,800 727,200 808,000 808,000 969,600 6,706,400
Costs phones [Euro] 0 0 49838 99677 132902 166128 149515 99677 149515 166128 166128 199353 1378861
Costs cases [Euro] 0 0 3630 7260 9680 12100 10890 7260 10890 12100 12100 14520 100430
Total "material" costs [Euro] 0 0 53468 106937 142582 178228 160405 106937 160405 178228 178228 213873 1479291
Gross margin [Euro] 0 0 188932 377863 503818 629772 566795 377863 566795 629772 629772 755727 5227109
People cost [Euro] 21000 30000 39000 30000 30000 30000 39000 30000 30000 30000 30000 42000 381000
Rent store [Euro] 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 1800000
Rent cars [Euro] 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 48000
Advertising [Euro] 250000 200000 150000 150000 100000 100000 100000 100000 80000 80000 80000 150000 1540000
Facilities [Euro] 1800 1800 1200 1200 1200 1200 1200 1200 1200 1200 1800 1800 16800
Fuel [Euro] 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 18000
Communications [Euro] 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Trainings [Euro] 2000 3000 3000 3000 3000 3000 0 0 0 0 0 0 17000
Total expenses [Euro] 432300 392300 350700 341700 291700 291700 297700 288700 268700 268700 269300 351300 3844800
EBITDA [Euro] -432300 -392300 -161768 36163 212118 338072 269095 89163 298095 361072 360472 404427 1382309
Fiscal year 2 2019
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Totals
Sales phones [Euro] 465,500 598,500 665,000 665,000 665,000 731,500 665,000 465,500 665,000 665,000 731,500 864,500 7847000
Sales cases [Euro] 50,050 64,350 71,500 71,500 71,500 78,650 71,500 50,050 71,500 71,500 78,650 92,950 843700
Total sales [Euro] 515,550 662,850 736,500 736,500 736,500 810,150 736,500 515,550 736,500 736,500 810,150 957,450 8,690,700
Costs phones [Euro] 105000 135000 150000 150000 150000 165000 150000 105000 150000 150000 165000 195000 1770000
Costs cases [Euro] 8470 10890 12100 12100 12100 13310 12100 8470 12100 12100 13310 15730 142780
Total "material" costs [Euro] 113470 145890 162100 162100 162100 178310 162100 113470 162100 162100 178310 210730 1912780
Gross margin [Euro] 402080 516960 574400 574400 574400 631840 574400 402080 574400 574400 631840 746720 6777920
People cost [Euro] 33000 33000 42900 33000 33000 33000 42900 33000 33000 33000 33000 46200 429000
Rent store [Euro] 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 1800000
Rent cars [Euro] 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 48000
Advertising [Euro] 100000 100000 100000 100000 100000 100000 100000 100000 80000 80000 80000 150000 1190000
Facilities [Euro] 1800 1800 1200 1200 1200 1200 1200 1200 1200 1200 1800 1800 16800
Fuel [Euro] 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 18000
Communications [Euro] 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Trainings [Euro] 3000 3000 3000 0 0 0 0 0 0 0 0 0 9000
Total expenses [Euro] 295300 295300 304600 291700 291700 291700 301600 291700 271700 271700 272300 355500 3534800
EBITDA [Euro] 106780 221660 269800 282700 282700 340140 272800 110380 302700 302700 359540 391220 3243120
Fiscal year 3 2019
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Totals
Sales phones [Euro] 532,000 598,500 665,000 665,000 665,000 731,500 665,000 532,000 665,000 665,000 731,500 877,800 7993300
Sales cases [Euro] 57,200 64,350 71,500 71,500 71,500 78,650 71,500 57,200 71,500 71,500 78,650 94,380 859430
Total sales [Euro] 589,200 662,850 736,500 736,500 736,500 810,150 736,500 589,200 736,500 736,500 810,150 972,180 8,852,730
Costs phones [Euro] 120000 135000 150000 150000 150000 165000 150000 120000 150000 150000 165000 198000 1803000
Costs cases [Euro] 9680 10890 12100 12100 12100 13310 12100 9680 12100 12100 13310 15972 145442
Total "material" costs [Euro] 129680 145890 162100 162100 162100 178310 162100 129680 162100 162100 178310 213972 1948442
Gross margin [Euro] 459520 516960 574400 574400 574400 631840 574400 459520 574400 574400 631840 758208 6904288
People cost [Euro] 36300 36300 47190 36300 36300 36300 47190 36300 36300 36300 36300 50820 471900
Rent store [Euro] 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 150000 1800000
Rent cars [Euro] 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 48000
Advertising [Euro] 100000 100000 100000 100000 100000 100000 100000 100000 80000 80000 80000 150000 1190000
Facilities [Euro] 1800 1800 1200 1200 1200 1200 1200 1200 1200 1200 1800 1800 16800
Fuel [Euro] 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 18000
Communications [Euro] 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Trainings [Euro] 3000 3000 3000 0 0 0 0 0 0 0 0 0 9000
Total expenses [Euro] 298600 298600 308890 295000 295000 295000 305890 295000 275000 275000 275600 360120 3577700
EBITDA [Euro] 160920 218360 265510 279400 279400 336840 268510 164520 299400 299400 356240 398088 332658836 months Budget

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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15

From the Budget can be observed also the breakeven point. A graph is presented
below for a more clear visualiz ation. Breakeven point is represented by a sells of about 3 0
phones (and associated cases) or total sales around 45 0000 Euro on a monthly basis.

Total Sales & EBITDA 2018 – 2020
2018 2019 2020
Sales [Euro] 6,112,950 8,690,700 8,852,730
Total EBITDA [Euro] 1,382,309 3,243,120 3,326,588
01,000,0002,000,0003,000,0004,000,0005,000,0006,000,0007,000,0008,000,0009,000,00010,000,000
2018 2019 2020Sales [Euro]
Total EBITDA [Euro]

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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16

5.3. Time plan

To timely monitor the main activities and responsible , especially in the first year, where more
divers activities are happening, we present below the tim ing plan.

VI. MONITORING INDICATORS

Indicators for implementation monitoring of this Marketing plan will be:
Sales monthly and yearly
Costs monthly and yearly (total)
Marketing costs/ campaigns /months vs budget
Customer satisfaction by questionnaires and Concierge service

VII. CONCLUSION
Opening a Vertu Boutique in Romania will increase the visibility and brand in our country, as in
East Europe, being the first one in this region.
Placing the boutique in dense commercial area where big businesses are running will assure a
reasonable profitability from the first year of activity, with a slight increasing trend in the next years.
Attention should be paid on the summer holiday period as Christmas one, to compensate drop in
sales in the first case, and to take be nefit in the second one, due to the fact that Vertu business is not
mass sells one and every phone sold is having serious impact.

VIII. REFERENCES

1. http://www.nokia.com/en_int/news/releases/2002/01/21/vertu -launches -the-worlds –
most -exclusive -instrument -for-personal -communication accessed March 2017
2. http://www.mobiado.com/inside_mobiado.html , accessed March 2017
3. https://www.goldvish.com/explore -goldvish , accessed March 2017
4. http://www.guinnessworldrecords.com/world -records/most -expensive -mobile -phone –
(cell -phone) , accessed March 2017
5. http://www.wonderslist.com/10 -most -expensive -mobile -phones -in-the-world/ accessed
March 2017
6. http://www.watch -that -label.com/label -to-watch -mobiado/ accessed March 2017
7. http://www.wall -street.ro/articol/IT -C-Tehnologie/136983/vertu -brandul -de-telefoane –
de-lux-mobiado -isi-anunta -intrarea -oficiala -in-romania.html accessed March 2017
8. https://www.romanian -companies.eu/resonor -srl-30195230/ accessed March2017
Milestones
Tasks Responsible Jan Feb Mar Apr May Jun JulAug Sep Oct Nov Dec Jan Feb Mar Apr May Jun JulAug Sep Oct Nov Dec Jan Feb Mar Apr May Jun JulAug Sep Oct Nov Dec
Legal company formalities Vertu Central
People hiring Vertu Central
Store rental agreement Vertu Central
Car rental for the employees Local HR
Store fit -out Vertu Central &Local Store Manager
Opening advertising campains Vertu Central&Local Marketing
People training Vertu Central
Store opening
Regular advertising campain Local Marketing
Normal store operation Local team2018 2019 2020

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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17
9. http://www.euromonitor.com/luxury -goods -in-romania/report/ accessed March2017
10. http://www.cpp -luxury.com/rom anias -luxury -market -shows -recovery -signs -after -3-years –
of-downfall/ accessed March2017
11. https://www.antena3.ro/en/a uto/romania -the-country -of-luxury -cars -sales -have –
skyrocketed -compared -to-last-year -351406.html/ accessed March2017
12. http://www.euromonitor.com/luxury -goods -in-romania/report/ accessed March2017
13. http://it.bzi.ro/producatorul -de-telefoane -de-lux-mobiado -spune -ca-a-vandut -deja-
modele -de-8-000-de-euro-in-romania -7024/ accessed March2017
14. http://www.businessmagazin.ro/topurile -business -magazin/top -bm-cele-mai-scumpe –
telefoane -mobile -vandute -in-romania -galerie -foto-4173816 accessed March2017
15. http://www.manafu.ro/2017/03/cati -milionari -sunt-in-romania/ accessed March2017
16. http://www.zf.ro/zf -24/cati -romani -au-salariul -de-cel-putin -10-000-de-lei-pe-luna-
12665258 accessed March2017
17. http://jurnalul.ro/bani -afaceri/piata -muncii/cel -mai-bine-platit -roman -castiga -114-salarii –
minime -721913.html accessed March2017
18. http://www.gsp.ro/fotbal/liga -1/fotbalul -conduce -in-topul -celor -mai-bine-platite -joburi –
din-romania -un-stelist -e-peste -toti-directorii -din-tara-473455.html/ accessed
March2017
19. http://www.capital.ro/recensamantul -bogatilor -cati-romani -au-devenit -milionari -in-
ultimul-an.html , accessed March2017
20. www.zf.ro ,( http://www.zf.ro/zf -24/salariul -mediu -net-trece -de-2-000-lei-in-cinci -judete –
in-capitala -urca-mai-aproape -de-3-000-de-lei-care-sunt-orasele -unde -veti-castiga –
cel-mai-bine-in-2016 -14953431 )
21. http://adevarul.ro/news/societate/orasele -incare -merita -traiesti -romania –
_54be0bcb448e03c0fdc5b71e/index.html accessed March2017
22. http://money.cnn.com/2015/10/29/technology/apple -customers/ accessed March2017
23. http://ww w.smark.ro/articol/24336/luxul -in-romania -statistici -consumatori -piedici -si-
oportunitati -tendinte -si accessed March2017
24. http:/ /www.cugetliber.ro/stiri -economie -romanii -au-cumparat -sute-de-masini -noi-
porsche -si-jaguar -in-2016 -307186 , accessed March2017
25. http://statistici.insse.ro/shop/?page=publD&lang =ro&publ_id=239 accessed March2017
26. http://www.smark.ro/articol/24296/specificul -pietei -de-lux-din-romania -tipuri -de-consumatori -si-
portofoliul -de Accessed March 2017
27. https://www.vertu.com.ro/descopera -telefoanele -vertu/ accessed March2017
28. http://actualmm.ro/invitatii -lui-tiriac -afla-cine -participa -in-acest -an-la-vanatoarea -de-mistreti -de-
la-balc/ accessed March2017
29. http://www.artmark.ro/ acces sed March 2017
30. https://www.rotary.org/ accessed March 2017
31. http://afacj.ro/ accessed March 2017
32. http://www.endava.com/en/ accessed Mar ch 2017
33. http://www.ebs.com/ accessed March2017
34. http://www.betfairromania.ro/ accessed March2017
35. http://www.ziardecluj.ro/top -21-firme -de-it-din-cluj-endava -ebs-si-iquest -au-avut -cele –
mai-mari -cifre -de-afaceri -2014 accessed March2017
36. http://www.euractiv.ro/economic/industria -it-din-romania -14.000 -de-companii -75.500 –
de-angajati -si-venituri -totale -de-4-mld. -euro -2722 accessed March2017

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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18

APPENDIX 1 – FULL -LINE PRICING VERTU
Price list analysis
Product line Item Distributors
price Boutique
price Distributors
margin % Distributor
markup
per unit –
value
SIGNATURE Navy Alligator €12.670 €18.100 30% €5.430
Black Alligator Stainless
Steel €11.410 €16.300 30% €4.890
Red Calf €9.590 €13.700 30% €4.110
Signature for Bentley €12.880 €18.400 30% €5.520
Ultimate Black €14.700 €21.000 30% €6.300
Red Gold Ultimate Black €21.350 €30.500 30% €9.150
White Mother of Pearl €14.700 €21.000 30% €6.300
Pure Black €10.290 €14.700 30% €4.410
Black and White €14.350 €20.500 30% €6.150
Stainless Steel Black
Leather €9.170 €13.100 30% €3.930
Clous de Paris Stainless
Steel €10.850 €15. 500 30% €4.650
Clous de Paris Pure
Black €12.530 €17.900 30% €5.370
Zirconium Alligator €12.530 €17.900 30% €5.370
Pure Chocolate
Stainless Steel €11.060 €15.800 30% €4.740
Cases 260-750€ 520-
1500€ 100% €505
SIGNATURE
TOUCH Almond Alligator €8.680 €12.400 30% €3.720
Cocoa Alligator €8.960 €12.800 30% €3.840
Carbon Sport €9.450 €13.500 30% €4.050
Teal Fluted €6.860 €9.800,00 30% €2.940
Sky Blue €13.580 €19.400 30% €5.820
Signature Touch for
Bentley €9.730 €13.900 30% €4.170
Jet Calf €6.1 60 €8.800 30% €2.640
Garnet Calf €6.160 €8.800 30% €2.640
Grape Lizard €6.930 €9.900 30% €2.970
Pure Jet Lizard €7.700 €11.000 30% €3.300
Jet Alligator €8.960 €12.800 30% €3.840
Pure Navy Alligator €9.940 €14.200 30% €4.260
Clous de Paris Allig ator €11.410 €16.300 30% €4.890
Pure Jet Red Gold €13.160 €18.800 30% €5.640
Cases 290-1450€ 580-
2900€ 100% €870

TEAM 4 – Mar keting Plan VERTU – 26.03.2017
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ASTER Black Chevron €2.870 €4.100 30% €1.230
Pink Chevron €2.870 €4.100 30% €1.230
Blue Chevron €2.870 €4.100 30% €1.230
Leaf (avail able online) €6.510 €9.300 30% €2.790
Orchid Calf (available
online) €3.850 €5.500 30% €1.650
Caramel Calf €3.850 €5.500 30% €1.650
Quilt Black (available
online) €4.620 €6.600 30% €1.980
Quilt Blue €4.620 €6.600 30% €1.980
Stingray Black
(ava ilable online) €5.810 €8.300 30% €2.490
Stingray Blue (available
online) €5.670 €8.100 30% €2.430
Stingray Pink (available
online) €5.670 €8.100 30% €2.430
Diamonds Black
Alligator (available
online) €6.930 €9.900 30% €2.970
Diamonds Red Alligat or
(available online) €6.930 €9.900 30% €2.970
Onyx Calf (available
online) €3.850 €5.500 30% €1.650
Blush Calf (available
online) €3.850 €5.500 30% €1.650
Lagoon Calf €3.850 €5.500 30% €1.650
Caviar Karung €5.040 €7.200 30% €2.160
Tangerine K arung €5.040 €7.200 30% €2.160
Raspberry Ostrich €5.390 €7.700 30% €2.310
Cognac Ostrich €5.390 €7.700 30% €2.310
Cases 165-600€ 330-
1200€ 100% €765