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Business Proposal

Team #: 94

Client (Company): Daffodils Games & Publishing (Daffodils GP)

Chosen target country: Nigeria

Product/Service (a brief description, 3-10 lines):

Daffodils GP is a privately-owned company that strives to provide its consumers with a means to

“intelligent fun” through the development of games for recreational and educational purposes. Its

products are distributed in a variety of formats, including through web, mobile, events, and competitions.

The products are customizable based on its purpose, such as through the publishing of educational books

as teaching aids for schools. The two products of interest are Bonanza, a card game where players try to

form the highest or lowest whole number with the cards they have, and Nudu, a board game where players

strive to reach fulfillment in life.

Number of pages, including title page: 31

Team members:

Name Country Work completed: Please briefly describe the work completed

by each team member

Elizabeth K. Steen USA Marketing strategy, competition research, proofread/edited

report

Reid Johnson USA Staffing strategy,

Jacob Dahl Paul Sweden Entry mode, proofread report

Kristina Kiseleva Russia Select a market (research)

Man Nga Chan Hong Kong Analysis of the client organization and product,

Lily Wu Canada Market success factors, Executive summary, Select a market

(writing), Staffing strategy, edited and proofread entire report

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EXECUTIVE SUMMARY

Situated in Ghana, Daffodils Games and Publishing (Daffodils GP) is a private limited

liability company that develops and produces games for its customers as tools for socializing and

learning. By positioning itself as a source of “intelligent fun”, Daffodils GP aims to attract

consumers from all cultures and age groups. In addition to producing games, the company

provides assistance to game designers through its consulting services.

The two products Daffodils GP wishes to introduce to the foreign market are Bonanza, a

card game drawing on players’ mathematical knowledge, and Nudu, a board game centering on

life fulfillment. To succeed economically in foreign ventures, Daffodils should assess the

market’s demographic trends, income levels, and cultural environment. Games should be

affordable to the target market and tailored to the needs of each age group, while accounting for

consumers’ values and tastes. Nigeria, being Africa’s largest economy, is the recommended

market for entry due to its cultural similarity with Ghana across the Hofstede dimensions.

Nigeria has effective monetary and countercyclical policies in place to reduce budget deficit,

illustrating efforts to strengthen its economy. Development of stronger public-private

partnerships for roads, agriculture, and power increases the ease of conducting business there.

To penetrate the Nigerian market, Daffodils should export its goods to a wholesaler and

launch an online store, allowing the company to assess demand levels for its goods in foreign

markets while minimizing the risk to do so. A regiocentric staffing approach will be used,

employing Nigerian wholesalers for the export method and currently employed Ghanaians for

their online store. To increase awareness of its brand and current products among target

consumers in the Nigerian market, Daffodils should position itself as “intelligent fun” through

the use of radio and Facebook ads.

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ANALYSIS OF THE CLIENT ORGANIZATION AND PRODUCT

Daffodils Games and Publishing (Daffodils GP) is a private limited liability company

established in 2009 in Ghana. The company strives to develop and publish an assortment of

games to provide fun, challenging, and educational experiences for individuals of all ages and

cultures. To differentiate itself from competitors, Daffodils positions itself as a gaming company

that creates “intelligent fun”. Daffodils produces games tailored to the needs of organizations and

institutions, such as teaching aids for schools. It continuously strives to improve the

entertainment value and functions of its products to meet consumer demands.

Daffodils GP strives to become the leading publisher of games worldwide by developing

games in many formats such as mobile, web, events, competitions, etc. (Daffodils GP, 2013). Its

current channels of distribution are direct selling, sales representatives, and distributors/agents.

Most recently, the company has been actively promoting its brand and products on the Internet to

strengthen its web presence. Daffodils created its own Facebook page in 2013 and joined Twitter

the following year (Daffodils GP, 2013).

Daffodils is introducing two products into the new market: Bonanza and Nudu. Both

games are suited for players of all ages and cultures. Its key competitors are Monopoly from

Bestman Games, Taytronik’s mobile version of Ayo, and Winning Moves UK’s Whot! which has

been developed into a mobile format by nKanika Inc.

SWOT ANALYSIS

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INTERNAL STRENGTHS

Since Daffodils is currently focused on promoting only two products, it can direct more

effort and resources to ensure product turnover. Competitors who have a vast array of products to

promote could potentially experience cannibalization among similar products. Additionally, the

resources available at their disposable would be limited, potentially reducing the quality of its

promotional efforts.

Daffodils has diverse product lines and business operations. In addition to games, books

and other educational tools have also been published, such as RUPC a card game designed to

teach new drivers Ghana’s Highway Code (2013). Developing games in a variety of media

allows for a greater reach of customers. The company also offers design consultancy services,

providing clients with creative solutions to their designing needs. Diversification protects

companies when mature products have reached the end of their life cycle (Porter, 1987). It also

allows companies to invest in profitable areas where growth is promising (1987).

INTERNAL WEAKNESSES

Daffodils GP is a small player in the gaming industry, owning a smaller proportion of the

market relative to its competitors. To date, it is operating on a small scale, exclusively serving

the Ghanaian market. It has fewer products available compared to competitors, losing benefits

associated with economies of scale and vulnerable to changing consumer tastes.

EXTERNAL OPPORTUNITIES

Research conducted by Gfk (2012), a German market research firm, suggests that 1.72

billion ZAR are currently generated by South Africa’s gaming market. Consequently, South

Africa is an attractive market for Daffodils GP to enter. The rise in the usage of smartphones

worldwide also presents an opportunity for Daffodils to further develop its mobile-based games.

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Additionally, predominantly young populations in regions like Nigeria and South Africa are

attractive to gaming companies like Daffodils as this consumer segment has greater demand for

leisure goods and learning tools (The World Factbook, 2014).

EXTERNAL THREATS

Consumer expenditure amounted to about $600 billion in Sub-Saharan Africa in 2010

and is expected to reach nearly $1 trillion in ten years (Hatch et al., 2011). This trend attracts

numerous competitors into the African market. In fact, Bestman Games has launched the

Nigerian Centenary Edition of Monopoly on February 25th

, 2014 (Bestmangame New Edition,

2014). Evidently, growth of the African market brings about serious competition to Daffodils.

Daffodil GP’s key competitors are well-known worldwide. For example, Monopoly

creates different versions of the game tailored to specific target cities. Bestman Games’

responsiveness to local tastes was a highly successful strategy, making the Lagos City edition of

Monopoly a popular board game in Nigeria. Originated in Nigeria, Ayo is one of the oldest games

in the world; it is now the most popular board game in West Africa. Whot! has grown to be one

of the most prevalent social games on mobile devices through Facebook, Android, and iPhone

iOS. Evidently, Daffodils must focus its efforts on increasing brand and product awareness to

pursue a greater share of the market.

MARKET SUCCESS FACTORS

Global expansion is a growth strategy employed by companies who wish to capitalize on

the untapped or underserved needs of their target market. In order to be successful, companies

must strategically analyze the presence of key success factors in the potential market that would

favor entry into its industry. Through careful examination of the gaming industry, the most

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significant factors of economic success for Daffodils GP are the new market’s demographic

trends, economic environment, and cultural environment.

Daffodil GP’s two products of interest are Nudu, a board game designed for players from

ages twelve and up, and Bonanza, a multi-player card game for individuals from ages nine and

up that elicits players’ mathematical fluency. As such, population characteristics should be

investigated prior to market penetration. Many countries have developed rating systems to

provide consumers with better guidance to user suitability. For instance, South Africa’s Film and

Publication Board ranks games from A to XX, with content suitable for all age categories to

being strictly limited to adults (“FPB Classification Guidelines”, 2014). If the region of interest

has a relatively young population, the game’s level of sophistication should be minimized to

attract the largest customer base. Consequently, games could be designed around the use of

cartoon pictures rather than numbers and abstract concepts. Additionally, younger populations

have greater demand for Daffodils’ educational products as they still attend school. Assessing

population trends will be useful for meeting the needs of targeted age groups as they mature.

Another notable success factor would be the target region’s income levels. Games are

classified as wants, often occupying individuals’ wish lists but never a necessity for survival. In

the world of economics, Daffodils’ products are classified as “normal goods”. These are goods

where an increase in income results in an increase in demand for the good (Black et al., 2009).

Those with lower levels of income exhibit a higher degree of price sensitivity and are less likely

to purchase leisure goods. Thus, income levels should be sufficiently above the region’s poverty

line to ensure product affordability and attractiveness to target consumers.

The region’s cultural environment also plays a significant role in Daffodils’ economic

success. For instance, there may be confusion across cultures regarding the interpretation of

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gaming instructions. Take Nudu, where the objective of the game is to reach “fulfillment in life”.

The word ‘fulfillment’ itself contains ambiguity. From the lens of an individualistic society,

where emphasis is placed on personal achievement and independence, fulfillment would likely

be regarded as individual career advancement (Hofstede, n.d.). Collectivistic societies are

characterized by harmony and group well-being, where fulfillment might involve marriage and

procreation to adhere to societal norms (n.d.). Thus, gaming instructions must account for a

region’s cultural context to ensure relevance to the target market. Product packaging also plays a

significant role in consumer purchasing decisions across cultures. It is important to avoid the use

of gender-specific references, abbreviations, colloquial language, humor, and culture-specific

metaphors (Aykin & Milewski, 2005). Furthermore, careful selection of colors that do not invoke

negative emotions and perceptions will maximize the product’s success (Choungourian, 1968).

For instance, research conducted by Wooten (2011) revealed that use of the color purple

generated perceptions of luxury to the British but signaled low quality to the Taiwanese. In

general, brightly coloured packages with high contrast attracted a greater level of interest –

particularly female attention – than duller ones (Aslam, 2006). If Daffodils GP wishes to

penetrate the North American market, incorporating a yellow light bulb in its advertisements

would adhere to its slogan of “intelligent fun” as it symbolizes innovation. Used appropriately,

color and imagery can be great tools to help a company build brand identity and preference

among targeted consumers.

SELECT A NEW MARKET

Since Daffodils GP is a relatively small player in the gaming industry, the most suitable

region for the company to enter would be Africa. Of that region, the most attractive countries are

Algeria, Nigeria, and South Africa. However, Nigeria and South Africa are the two most

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promising markets. Like Ghana, the official language for both countries is English (The World

Factbook, 2014). Therefore, language barriers would not be an issue in conducting business.

Located in North West Africa, Nigeria is the most populous region and makes up the

continent’s largest economy, with a GDP nearing $502 billion U.S. in 2013 (The World

Factbook, 2014). The country is experiencing annual growth at a rate of 6-8% from the

telecommunications, services, and agricultural industry (2014). This is beneficial for Daffodils

since it develops many mobile-based games. Nigeria has developed public-private partnerships

to address its inadequate power supply, which is favorable for Daffodils in effectively delivering

its web-based games. As depicted in the population pyramid below, Nigeria has a very young

population like Ghana. The majority of its population is under age twenty, illustrating the

opportunity for Daffodils to tailor its products to meet the needs of schools. Its products Nudu

and Bonanza are suited for players aged nine and up, targeting a major age group. Future growth

is promising, as the younger age groups mature.

According to the World Bank, Nigeria is a lower middle-income country with individuals

earning around $480 to $645 U.S. per month on average (Adewunmi, 2011). This level of

income leaves enough money for them to spend on leisure goods (Hatch et al., 2011). Nigeria’s

official unemployment rate in 2011 was 23.9% (The World Factbook, 2014). However, strong

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monetary and countercyclical policies implemented to reduce budget deficit increases its ability

to handle economic pressures (2014).

Comparing Nigeria to Ghana, the two score similarly across Hofstede’s cultural

dimensions implying that cultural barriers are less prominent in conducting business. Both

countries have a high score on power distance indicating its acceptance for hierarchy (Hofstede,

n.d.). A low score on individualism depicts a collectivistic society that values group well-being

and the maintenance of long-term relationships through trust and loyalty (n.d.). The two

countries differ along the masculinity dimension. Nigeria is a masculine society with a

preference for achievement, competition, and material success. In contrast, Ghana is a feminine

society, where quality of life and equality take precedence to standing out among peers (n.d.).

Thus, it would be important for Daffodils to import these cultural values into its games to ensure

its relevance to the target market. For instance, life fulfillment for the game Nudu in both

countries should incorporate group achievement. Ghana would focus particularly on the group’s

quality of life rather than status, while Nigeria on competing with other groups to advance one’s

own. In regards to advertising, the color green which symbolizes Africa’s “abundant natural

wealth” is common to both countries, as indicated in their flags and is appropriate for product

packaging (Znamierowski, 2011).

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South Africa is home to the 16th

largest stock exchange in the world (The World

Factbook, 2014). It has well-established financial, legal, communications, energy, and transport

sectors (2014). This is attractive to Daffodils in regards to its mobile-based games and

distribution of its product to urban centers. Compared to Ghana, South Africa’s population

pyramid shows that the country is comprised mostly of individuals aged above twenty. Thus, the

opportunity for learning tools and leisure activities may be limited as this age group matures.

South Africa is an upper middle-income country, with enough disposable income per

month to spend on leisure goods (World Bank, 2014). However, it has an official unemployment

rate of 25.2%, with poverty and inequality among the highest in the world (The World Factbook,

2014). Unlike Nigeria, a significant budget deficit limits South Africa’s ability to effectively

address these economic pressures.

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According to Hofstede’s cultural dimensions, South Africa and Ghana are more culturally

distant. South Africa scores lower on power distance, indicating its preference for egalitarianism

(Hofstede, n.d.). The country is individualistic, valuing independence and personal achievement

(n.d.). Additionally, it is a masculine society that emphasizes competition and performance

(n.d.). Thus, games relevant to South Africa would center on actively competing to obtain

individual wealth. This cultural distance suggests that Daffodils should be particularly sensitive

to using culture-specific metaphors, humor, colloquial language, etc. in advertising.

After much analysis, Nigeria is the selected market for entry. Nigeria experiences similar

demographic trends as Ghana. This is important since many of Daffodils’ promotional activities,

like the MOBA-ADISCO 2014 fun day games, attract a greater percentage of youth. Upon

launching Bonanza and Nudu, the company will likely have greater success introducing

educational products. The Nigerian market is more culturally similar to Ghana’s, indicating that

they likely hold similar values and tastes. This complements Daffodils’ market development

strategy, where a company launches old products into a new market (Porter, 1987). As a small

player in the industry, it is crucial for Daffodils to enter markets with a high degree of similarity

to its own as it minimizes the need for product customization – an option that may not be feasible

if there are insufficient levels of capital at hand. It is important to note that South Africa has an

unstable electricity supply; with power plant construction postponed which limits Daffodils’

online market potential. In contrast, Nigeria is continuously developing stronger partnerships to

deliver stable sources of power to its citizens. Lower levels of unemployment, relative to South

Africa, indicate that the majority of its population can allocate income to leisure goods. Nigeria’s

decreasing budget deficit leaves room for government interventions during times of economic

hardships. Accounting for Daffodils’ interests, the Nigerian market is most suitable for entry.

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ENTRY MODE

When entering a foreign market, there are generally three different questions a company

must address. Firstly, the company must consider which market to enter (which is discussed

further in the previous section). Next, it must decide when to enter the selected market (in the

case of Daffodils, the desired time of entrance is the nearby future). Lastly, the company must

then focus on what scale of entry they wish to pursue. When these three questions are answered,

it can start focusing on which method of entry would be optimal (Hill & Hernandez-Requejo,

2011).

A vast array of options are available at a company’s disposable when deciding to enter a

new market. Although there are no right or wrong choices, certain options are more feasible than

others. In regards to Daffodils Games and Publishing, exporting, licensing, creating a wholly-

owned subsidiary, engaging in a joint venture, and signing a management contract are the most

appropriate. The following matrix pinpoints some of the biggest advantages and disadvantages of

the options listed:

Method Advantages Disadvantages

Exporting Avoids the substantial costs of

establishing manufacturing

operations in the foreign

country

Helps the firm achieve

experience curve and location

economies

Company can have more control

on areas such as pricing and

distribution

Company can diversify its risks

(i.e. losses from domestic

market operations can be

recovered from gains in the

foreign market)

Travel and service costs

Required to keep track of the business

procedures which takes more time

Trade barriers

Poorly marketed product. Daffodils

would export to a wholesaler that also

sells other companies’ games, which

gives them a divided loyalty.

Therefore, the company will not market

the product with the degree of effort

that Daffodils would have.

Licensing Feasible to companies with low

levels of capital due to lower

High brand risk with a chance of the

company losing control over the

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costs and risks

Minimizes effects of trade

restrictions

manufacturing, marketing and strategy

Less profitable, as return must be

shared between the parties

Without good legal representation, high

risk of losing intellectual property (i.e.

licensee may sell similar products

when the agreement expires),

Wholly-

owned

subsidiary

(Greenfiel

d ventures

or

acquisition

)

High degree of control over

operations in different countries

100% share of the profits

Method is very costly and risky

Daffodils does not have a lot of

products and it might be costly to set

up their own store just to launch two

products. (In that case an acquisition

would be better than a greenfield

venture, since they might acquire other

products as well. Still, this option is

very expensive)

Difficult to change the culture of an

acquisition

A lot of work with a greenfield venture

Joint

venture

Share the risk and cost with

venture partner

Easier to enter the market with

the help of venture partner

Gain the experience, resources

and information from the

venture partner

Political advantage: lower risk

of being subject to

nationalization or adverse

government interference

Might be challenging to build the right

relationship with another business

Different cultures and management

styles result in poor integration and co-

operation, particularly if the companies

have different strategies and goals

High brand risk

Manageme

nt

Contract

Hire expert help from people

with experience

Assurance of the continuity of

the business

Lower risk

High brand risk

Lack of awareness about new market

trends

Risky on international markets due to

social and political reasons

(Hill & Hernandez-Requejo, 2011)

Marc-Peter Zander (2012), CEO of XCOM Africa, confirms that distribution models like

exporting are the preferred model for the Nigerian market as it provides companies with low

overhead costs and a wider product coverage. Further, he points out that it is important to

conduct a thorough assessment of suitable candidates to partner with in the foreign market

(2012). This allows the company to leverage its partner’s social networks, facilitating access to

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target consumers. Although Nigeria has a tariff rate averaging 10.6%, both Ghana and Nigeria

are members of the Economic Community of West African States (ECOWAS, 2007).

ECOWAS’s objective is to support regional integration in “all field of economic activity,

particularly industry, transport, telecommunications, energy, agriculture, natural resources,

commerce, monetary and financial questions, social and cultural matters” (2007). Furthermore,

the African Union is striving for a continental free trade zone by 2017, eliminating current

restrictive trade policies (African Union, 2013). By choosing to export to the foreign market, the

company will be able to avoid costs such as building a foreign subsidiary, licensing fees, etc.

Since Daffodils GP has only two products to present to the new market, there are relatively high

costs and risks related to the other options available. Setting up a factory to produce only two

products limits a company’s ability to exploit benefits like economies of scale. In contrast,

exporting allows the company to penetrate the market on a smaller scale to “test out the waters”,

thereby obtaining information on market perception and demand levels for its products. This

helps Daffodils GP learn more about the Nigerian market so they can use their newfound

knowledge to achieve a bigger market share in the gaming industry and expand into other

potential markets.

There are two different ways to export: direct and indirect transporting.

Type Description Advantages

Disadvantages

Direct

Exporting

Selling the

goods/ services

directly to end

customers

Greater degree of control

throughout the transaction

since the owner controls

logistics and after sales

services

Greater potential profits via

elimination of intermediaries

Develop a better

understanding of the

Takes more time, effort and

money than the owner may

be able to afford

The owner needs to bear

more responsibility when

servicing the demands of the

business

If the owner decides to

venture on a more

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marketplace.

Greater flexibility to

improve or redirect the

marketing efforts to the

specific marketplace, since

owner manages the

transactions

technological product, they

must be prepared to respond

to technical questions

regarding the product and

provide start-up training or

ongoing support services.

Slow response times to

customers due to absence of

local agent

Indirect

exporting

Selling

good/services

through an

intermediary

who in turn

sells the

products either

directly to

customers or to

importing

wholesalers.

Fast market access

Concentration of resources

towards production

Little or no financial

commitment, as the clients'

exports usually covers most

expenses associated with

international sales.

Low risk for companies who

consider their domestic

market to be more

important and those that are

still developing their R&D,

marketing and sales strategy

Export management is

outsourced, alleviating

pressures on the

management team

Less control over

distribution, sales, marketing

as opposed to direct

exporting

Wrong choice of distributor

and market may lead to

inadequate market feedback

affecting the company’s

international success

(Delaney, 2014)

Since Daffodils GP is a small player in the gaming industry, it may be difficult for them

to provide the level of capital and the ideal number of products needed to develop a wholly-

owned subsidiary. With the given conditions, indirect exporting to a wholesaler would be the

best option for Daffodils at the given time. They would benefit from the wholesaler’s reputation

and get access to the in-depth market research conducted. The wholesaler would have assessed

the attractiveness of each market segment and strategically positioned themselves to reach their

target consumers. Since the gaming market is well established, players are unable to capture

benefits of being the first mover. Therefore, we feel that the costs and risks associated with

establishing a wholly-owned subsidiary would outweigh its benefits. Instead, they would benefit

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most by first entering the market at a small scale before possibly penetrating deeper into the new

market. Daffodils would still have a high degree of control over their products due to in-house

production.

Further, we recommend that Daffodils GP launches an online store to distribute its

products. This channel would increase consumers’ awareness of other upcoming products,

making its business more competitive. Currently, their webpage presents the products in brief

along with downloadable instructions for each game; the visitor cannot order any products

offered by the company. By opening an online store, customers from across the globe get access

to Daffodils’ products, allowing the company to compete in an unlimited number of markets. As

internet usage rates in Western regions of Africa are growing rapidly, it is strongly recommended

that a company like Daffodils be prepared to compete online in order to reach its target

consumers (Internet Live Stats, 2014). This helps the company become an early adopter in the

use of new technological tools to strengthen its market share. As a small player in the gaming

industry, operating online would allow Daffodils to differentiate itself from key competitors.

Since the company projects an image of “intelligent fun”, leveraging new technology helps

strengthen this position. Additionally, online operations complements Daffodils’ exporting

method. A disadvantage of indirect exporting is that the company loses sight on who their true

end consumer is, limiting its ability to tailor products to satisfy their needs. Operating an online

store gives Daffodils a source to collect data on current market trends and get a better sense of

their customers’ evolving needs for the future.

STAFFING

Daffodils GP will take a regiocentric staffing approach, with talent sourcing based on the

regional context of Daffodils’ business operations (Dowling et al., 2013). This approach is

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sensitive to local differences and facilitates communication across regions due to the constant

need for collaboration with company headquarters (2013). A list of viable options to staff

Daffodils’ entry strategy is presented below.

Indirect Exporting:

OPTION ADVANTAGES DISADVANTAGES

Current Ghanaian

Employees (Parent-Country

Nationals)

Understand the company’s

strategy and organizational

culture

Develop better

understanding of Nigerian

market via direct, ongoing

contact

Limited knowledge of

international market (e.g.

local laws, tastes)

Costly to relocate

employees to Nigeria (e.g.

housing, healthcare, visa)

Difficulty adapting to new

environment (e.g. being

away from family)

Outsource Product

Distribution (to Nigerian

Wholesaler)

Able to use established

networks to push product to

the market

Better knowledge of the

market

Less costly

Also sells competing

products

Split profits with

wholesaler

(Dowling et al., 2013)

Launching Online Store

OPTION ADVANTAGES DISADVANTAGES

Current Ghanaian

Employees (Parent-Country

Nationals)

Knowledge of the company

and its organizational

culture

Have the technical skills

required to operate a

webpage

Increases employee morale

via opportunities for

promotion

Lack of outside

perspectives on issues like

how to improve webpage to

attract a diverse market

Nigerian Employees (Host-

Country Nationals) Better knowledge of the

Nigerian market

May require additional

training (e.g. webpage

designing)

May lack knowledge about

the company

(Dowling et al., 2013)

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We recommend that Daffodils outsource product distribution to a Nigerian wholesaler for

its exporting activities and staff its online operations with current Ghanaian employees. The in-

depth market knowledge of a local wholesaler is particularly crucial for a company with limited

international experience. Having a Ghanaian international sales manager to oversee Daffodils’

exporting activities would be less efficient, with time and money being allocated on traveling

across borders. Additionally, the manager’s difficulty adapting to a different environment could

impede productivity. In regards to its online store, using Ghanaian employees is the optimal

choice because Daffodils can also get feedback on the Nigerian market through online sales.

Daffodils already operates its own webpage, indicating that its employees are already equipped

with the necessary skills. Separating online store operations by region would be problematic as it

results in duplication of tasks and results in a narrow view of the company as a whole.

INDIRECT EXPORTATION

For Daffodils’ indirect exportation, we recommend that four host-country nationals be

hired. The four wholesalers will be responsible for handling imports, ensuring shipments are on

schedule, and that adequate levels of inventory are on hand. Each will be separated by region

(i.e. north, east, south, and west) to ensure wider product coverage. These wholesalers will be

compensated based on an hourly minimum wage plus commission based on sales performance.

The minimum wage in Nigeria is currently 18,000 per month (Minimum-Wage, 2014).

Commission will amount to a percentage of sales to align the wholesalers’ interests with the

company, pushing Daffodils’ products over its competitors. This will be paid on a monthly basis,

giving frequent feedback to employees so goal setting and corrective action can be taken

throughout the year to maximize the achievement of yearly sales targets.

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Wholesalers will be hired based on their regional context. Each region will have the

opportunity to get a year-end bonus if sales targets are met, instilling regional commitment and

interregional competition among wholesalers, which aligns with the collectivistic and masculine

society. These individuals will be externally recruited through search firms or networks that

Daffodils may have in the Nigerian market. In terms of selection, interviews can be conducted to

ensure that candidates have the necessary skills for the role. Wholesalers must have a strong

sales background, a few years’ experience dealing with exporting companies, and great

communication skills.

A propose payment schedule is illustrated below:

ONLINE STORE

Daffodils GP has its own webpage, suggesting that they currently have staffing for their

online functions (e.g. making the site aesthetically pleasing, promoting products and events,

etc.). However, to support the launch of its online store, two additional employees will be hired.

One employee will be responsible for the management of online sales, handling issues like

shipping method and collecting data on consumer tastes and trends. This individual will be paid

an hourly minimum wage. The minimum wage in Ghana is 180 GHS per month (Mywage,

Commission Based Pay

Sales (in units per month) <500 501 - 1000 1001 - 2000 2001 - 3000 3001 - 4000 4001 - 5000 >5000

Percentage of Sales Comissioned 0% 0.50% 1.00% 1.25% 1.50% 1.75% 2.00%

Estimated Cost of Commission Pay (In units of product) 0 2.505 - 5 10.01 - 20 25.0125 - 37.5 45.015 - 60 70.0175 - 87.5 100+

Exportation Staffing PaymentDaffodils Games and Publishing YR 2015

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2014). The second employee is responsible for providing after-sales services, handling issues

like returns and obtaining customer feedback. Both employees will have an opportunity for a

team bonus at year-end if online sales targets are met, aligning with collectivistic values. They

will be recruited through conducting a talent management inventory, with staff currently

operating the website as preferred candidates. The selection decision will be made based on

recommendations. To qualify for the job, candidates must have a few years’ experience working

with computers in a similar role, strong analytical capabilities, excellent customer service skills,

and good communication skills.

A proposed payment schedule is presented below:

MARKETING

Daffodils Games and Publishing’s expected marketing challenge is to increase awareness of its

products, Bonanza and Nudu, among consumers in the target market and to uniquely position themselves

against key industry competitors. The objective of the product promotion strategy is to increase the

company’s awareness level by 25 percent by January 1st, 2016.

To Daffodils’ advantage, playing games is a common leisure activity in Nigeria that helps “bring

about a peaceful co-existence” (BattaBox.com, 2013). Nigerians can often be found playing board and

card games after school or work with friends and family for recreation, socialization and to stimulate their

minds (BattaBox.com, 2013). Daffodils’ products positively align with the values and attitudes of

Nigerian game players with Bonanza, a thrilling card game that exercises the mind, and Nudu’s spiritual

element of fulfillment.

Page | 21

COMPETITION

In order to be successful in this market, Daffodils must uniquely position its products against key

competitors including: Monopoly distributed by Bestman Games, the mobile version of Ayo created by

Taytronik, and Whot! distributed by Winning Moves UK and the mobile version developed by nKanika

Inc. To compete in the Nigerian market, Daffodils should emphasize its position as being “intelligent fun”

offering high-quality, entertaining and challenging learning experiences through board, card, and online

games.

TARGET MARKET

The ideal target market for Daffodils’ products is the Rising Strivers, the middle-class segment in

the Sub-Saharan African market. This market segment is comprised of individuals who have obtained

more purchasing power through their access to credit and/or developing in-demand skills (Hatch et al.,

2011). They have a monthly income of about $250 to $750 U.S., leaving extra money to spend on special

occasion items (2011). In terms of product qualities, durability is ranked as the most significant factor in

purchasing decisions (2011). Rising strivers aim to advance further into more affluent segments. Thus,

they invest in their children’s education to reach these goals (2011).

Nigeria’s middle-class is well educated with 92% having completed a post-secondary school

education and accounts for 23% of the Nigerian population (The Guardian, 2014). According to an

estimate by Nigeria’s National Bureau of Statistics study in 2007, the country’s middle-class accounts for

30% of the population and is continuously growing (Rundell, 2009). As well, it is important to note that

Nigeria has a very young population, with half of its citizens being under twenty years old (The World

Factbook, 2014). This renders Nigeria as an attractive market for players in the gaming industry.

There are several factors to keep in mind when trying to reach Nigerian consumers. Firstly, the

irregular supply of power could potentially affect distribution activities. Low literacy levels of the

population as a whole may limit the attractiveness of certain market segments. Lastly, high costs of digital

Page | 22

devices relative to the country’s gross domestic product could influence the advertising channels at the

company’s disposal.

ADVERTISING STRATEGY

Since Daffodils is introducing a new product and is not an established brand in the Nigerian

market, the advertising strategy should focus on reach over frequency. By emphasizing reach, Daffodils

can increase awareness among the target audience. Two advertising channels that would best complement

this strategy are radio and the Internet. Many Nigerian consumers own or have access to equipment such

as radios, internet-connected personal computers, and internet-enabled mobile phones, which exposes

them to these advertising media (Akoh & Jagun, 2012).

RADIO

The top two sources of media consumption in Nigeria are radio and television. According to the

International Telecommunication Union, radio is the dominant medium reaching 75% of households

(2012). Radio is also a more cost-effective medium compared to television. Also considering the irregular

power supply, expensive television advertising would be a risky and potentially ineffective use of the

advertising budget.

Page | 23

INTERNET

Digital media supersedes print media. Less than 10% of the population reported reading a

newspaper or magazine in the last four weeks.

This can be explained by the significant growth in Internet use in the last decade. As of

December 2012, there are 56 million Internet users in Nigeria, which is 33% of the population

and amounts to 167 million people (Ghedin, 2014). The expansion of mobile phone use is the

key driver of Internet user growth, with mobile phones being the primary medium of Internet

access in Nigeria (Vanguard, 2010). According to the Nigerian Communications Commission,

54% of the population consisted of active mobile phone users in the first quarter of 2012. The

rising middle-class and the young population can explain the increase in mobile phone users.

Online advertising presents various benefits. First, it provides the company with wide

coverage, facilitating greater reach to its target audience. Advertising online is a very affordable

and cost-effective method, giving plenty of flexibility in terms of budget allocation. It drives

traffic to the company website, increasing consumer awareness for other products and

Page | 24

promotions available. Online sales are relatively easy to track and measure, allowing Daffodils to

make more accurate forecasts in demand levels to avoid shortages or surpluses of inventory.

ADVERTISING TACTICS

FREEDOM RADIO AND WAZOBIA

Radio listenership overall has continued to grow significantly, with news programs being

the most consistently listened to radio programs. The most popular station in the North West

region of Nigeria is the privately owned station, Freedom Radio 99.5 FM, located in Kano which

features informative, independent/investigative news, current affairs, educational and

entertainment programs (Dutse, 2014).

The top two stations in Lagos, Nigeria are Radio Lagos and Wazobia. Radio Lagos is the

most widely listened to station in Lagos; however, it broadcasts mainly in Yoruba and Ogu with

only 2% being English bulletins (Radio Lagos Eko FM, 2011). Wazobia 95.1 FM, Lagos

broadcasts mainly in Pidgin English in the most populous city in Nigeria. Wazobia features

music, global and national news, sports, interviews, games, and entertainment programs. The

target audience is the masses having programs that also attract the upper classes (Wazobia FM,

Page | 25

2013). The station reaches approximately a total of 30 million people located in Lagos, Epe,

Abeokuta, Badagry, Ikorodu, Shagamu, Ijebu-Ode, and Ibadan (2013).

Every other month, Daffodils will air a Freedom Radio ad starting in January and

continuing every odd month. The Freedom Radio commercial will last 30 seconds long at a mid-

news rate of about 11,377.59 Naira which translates into about $65.44 U.S. (Dutse, Radio Rates,

2014). Wazobia ads will air during the even months starting in February. The Wazobia ad will be

a 30 second spot during the weekdays between 5AM-11AM at a rate of 10,800 Naira, which is

about $62.12 U.S. (Wazobia FM, 2013).

Daffodils will use the same radio script for both stations, sharing information about both

Bonanza and Nudu with fun and engaging background music. The ad will share information on

where to buy the games, both in stores and online. Using the theme of “intelligent fun”, the radio

ad script will describe the games as being thrilling, engaging, addictive, fast-paced, fulfilling,

and appealing to individuals of all ages. The ad will also direct listeners to the Daffodils website

and Facebook page.

FACEBOOK

The reach of social platforms is wider and cheaper than traditional platforms. The number

one social networking site in Nigeria is Facebook and in May 2012, it was the most visited

website in Nigeria. As of September 2014, Nigeria has the most Facebook users in Africa with

just over 11 million users (Lesotho Times, 2014). Tolu Ogunkoy and mediaReach OMD predicts

that as an advertising medium, Facebook “may overtake radio and press in the not-too-distant

future” (The Economist, 2011).

Page | 26

There are two bid methods for Facebook ads: cost per click (CPC) and cost per thousand

impressions (CPM). For CPC, the account is charged every time a Facebook user clicks on a

CPC ad. On the other hand, whenever a CPM ad loads, the account is billed regardless of

whether or not the user clicks or even notices the ad. The cost per impression is cheaper than cost

per click. However, choosing CPM may lead to poor performance without accurate audience

targeting. CPC is beginner friendly and less risky (Okafor, n.d.). Until Daffodils has a better

understanding of its audience, the company should take advantage of CPC ads.

The company will only pay for the clicks they receive up to the amount set in the budget.

With the choice of either a daily or lifetime budget, Daffodils will use a lifetime budget where

instead of setting an amount to spend per day, the lifetime budget will be set to be spent across

the lifetime of the ad set. The Facebook system will automatically try to spend the amount out

evenly across the entire period of time selected. The average CPC for Facebook ads in Nigeria in

November 2012 was $0.78 U.S. (Statista, 2014). If Daffodils sets a lifetime budget of $1,000 for

the year, $2.74 U.S. would be spent each day. If the ad set ever spends less than $2.74 U.S. per

day, the system will try to make up for the missed amount at a later date within the ad set

(Facebook, 2014).

Page | 27

With the objective of raising awareness for Daffodils’ brand and products, the Facebook

ad set will include three different ads for Daffodils as a brand, its products Bonanzu, and Nudu.

The ads will incorporate the theme of “intelligent fun” and will vary from month to month, with

each ad being featured for a total of four months. Colorful and engaging, the ads will share

product and brand information, encouraging Facebook users to click on them. The Daffodils

brand ad will direct the user to the Daffodils Facebook page where the user can “like” the page,

engage with others in the community, and learn more about the company and its products. The

Bonanzu ad will bring the user to the Bonanzu product page on the main website. As well, the

Nudu ad will bring the user to its corresponding webpage.

The objective of the advertising strategy is to increase awareness while driving traffic to

the company’s Facebook page and website. Each radio and Facebook ad will be consistent with

the brand image and the “intelligent fun” theme. Through integrated marketing, Nigerian

consumers will become aware of and develop a better understanding of Daffodils and its

products as being fun, interactive, social, learning experiences for adults and children of all ages.

Page | 28

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