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‘378 CASES IN MARKETING MANAGEMENT or dstibution system, layout and usage of the facility, staff productivity, and freight analysis, The goat ecto lowe cos por end incasestrge coor dare itbkad an Gubound Gee casts, improve service levels, and improve turnaround time. # Implications for Customer Service Distribution systems affect both customer acquisition and customer retention. Stock-outs can influence customer acquisition and increase complaints Eficient and effective product and service Aelivery probably does not attract a great deal of atention, but folures in this area are readily apparent. ® Implications for Marketing M: Many of the tasks performed in the area of physical distribution are carried out by entry-level workers and first-line supervisors, First-line supervisors make sure items are moved carefully without breakage and that order forms are filed and processed correctly. Middle and top-level manages make decisions about distribution pattems, channel arrangements, warehouse forms, methods of inventory control, and forms of transportation, An effective distribution system informs workers at all evels ofthe outcomes of these decisions. S The YvesCreations LLC: Alex Goes to Hollywood ‘Alex Yes faced a major dilemma. He had created a Hollywood-style movie ited Movin’ Jn that seemingly had everything needed to become a successful project. It included a fun, romantic story, 4 strong international cast, and top-rate production. The story took pace in part in Switzerland, ‘making the fim a candidate for both the US. and European markets. In spite of these advantages, ‘Yves was notable to obtain a distribution deal from either a US. or a Swiss distributor. Recovering the nearly $1 million investment was going to be difficult. Yes wished he had spent more time market channel prior to investing 4 years of hs life ina film that might not make itto loca movie theaters. Eureka Forbes Ltd. Growing the Water Purifier Business the brand name for Eureka Forbes, Led, was a water purification system that had become highly successilin India. Ithad reached the point of widespread brand name recognition, Rapid economic expansion in India created a new opportunity: Greater number of customers outside urban areas were now interested in owning systems. Alo, increasing understanding by consumers of the health benefits of pure water ld to greater demand, especially in light of dimin- ishing water sourees. The marketing tam at Eureka Forbes set three goals (1) create products for various consumer needs and situations, (2) mit cannbalization between those products, and (3) stave off the entry of new competition. Bifective implementation of strategies designed to achieve these goals would lead to long-term, stable growth fr the company. Kraft Foods: The Coffee Pod Launch YeesCreations LLC: Alex Goes to Hollywood 379, Single-serve coffee pods are widely accepted and used in Europe. Kraft, noting this acceptance, Soa yang produ he Ue ‘States and Canada, In Canada, the company spent considerable effort promoting the new items to consumers, without waiting for results in the United States. Unfortunately, while Kraft gained a substantial market share, sales were highly disap pointing, One primary cause ofthe slow rate of use was the cofleemakers, which did not work well. The: ‘management team at Kraft knew that dramatic steps would need to be taken to turn marketing the situation into a more profitable operation, ——— YvesCreations LLC: Alex Goes to Hollywood ——— By David Wesley, under the supervision of Professor Chris Robertson ‘Alex Yves fet disheartened as he left the office of Zarich- based Digital Film Cooperative (DFC) with- ‘outa dea to distribute his recently completed inde- pendent fim, Movin’ In, Yveshad spent the past year to negotiate an agreement with a reputable n company, ist inthe United States and laterin Switzerland. DPC had been his lst hope, ‘To date, the only distributors willing to even consider his film had made offers of a percentage commision that Yves knew were untealistically low or that required him to relinquish his rights to the film without any compensation whatsoever. Bven in the most optimistic scenario, signing over. film rights for a commission would mean that his ‘company would be lucky to recover a fraction of the nearly $1 million it had invested in the fm, To ‘Yes, both types of offers were unacceptable. Movie? In bad all the ingredients ofa suocess- fal motion picture, It had star power, top-rate production value and a likeable story about a Swiss {mumigrant who falls into a series of comedic mis- haps when be attempts to connect witha Los Ange- les woman he met on the Interne. More impor- tantly, Yves believed that the films well-known ineroaoal cat wald strc ewes on both e tic, In limited private showings, ‘ost viewers seemed to enjoy the flm. Coppi ©2009, Nerketera Usher Cale of Busnes Adiairaon ‘fer devoting almost four years of hs life to the project, Yves had become increasingly frus- trated with distributors who were unwilling to promote Movin’ in on reasonable terms. Yves thought he might have better Tuck in his native ‘Switzetand, but he soon discovered that most ‘Swiss and German distributors were just as reluc- tant as their American counterparts. DEC was the last distributor on his ist because ofits focus on low-budget local productions, When the owner of [DFC refused to make Yves an offer, he fle dssp- pointed and discouraged, Later that evening, he discussed his frusta- tions with Sonja Mehner childhood friend who had recently moved to Zurich, “I thought I would have sold this lm a year ago and til ave noth- ing to show for it? he lamented, He wondered deve Poh oaptoty omen dice ssense."Pethaps | ought to felts hey. ‘Ashe recounted the last four years of his life, and the many challenges he encountered along the way, Yves hoped that his friend would be able to offer some constructive advice. For example, could he have been a better leader? Had he done enough to motivate crew members and resolve confit? enone (A) 2000-02-26 “ heta Fy te! OO val casey may fade, 380 CHAPTER 12: DISTRIBUTION AND SUPPLY CHAIN MANAGEMENT Background ‘Atage 18, Alex Yves had made his fist film a short feature about snowboarding in Swiverland, The film had been shown exclusively at loc snow- boarding events and some clips had been uploaded tovideo-sharing websites, which wasa new tendat the time. The proect taught Yves some valuable lessons about filmmaking: ‘As soon as the filming ended, people lost interest because they realized how much ‘work had to go into editing, music and all that. People are always interested in being partof the exciting stuf, which isthe filming, but they ae not interested in the hard work. ‘The value ofthe film was short-lived “because new stars came up on an almost monthly basis” ‘Within a year, Yves’ il was ll but forgotten, ‘After high school, Wes took a postion at IBM. asa strategic outsourcing proposal team leader. For the next two years, he provided information tech nology services to international companies that had offices in Switzeriand and wanted to outsource their internal information technology (IT). After two yearsof working 80 to 90 hoursa week, Yes decided to leave IBM to attend college inthe United States. ‘When I wss very young, maybe 12 years old, 1 already knew I wanted to study inthe US. 1 doit know why. There are just certain thing in life know I want to do, and study- ingin the US, was one of them. ‘After visitng several colleges, Yes decided on ‘Northeastern Univesity because of ts emphasis on “real-world experience? Unfortunately, his test scores were not high enough for admission to the fal-time business program. Undaunted by the rejection, Ys enrolled in the open evening pro- gram and, afer a year of strong academic perfor- mance, he was able to transfer into the fulltime ‘business program. Yves had always wanted to study fine arts, but hh believed thatthe career opportunites available to BFA graduates were too limited. I wanted to make money and be successful in lie, The best way to do that sto be business savy. thought to myself, "Why not do the business degre and then build on that know!- ‘edge and learn the creative stuff on the side” For Yves, Northeastern Une real-world experience was not real enough when he compared ‘twit if t IBM, To keep himself “grounded inthe ‘working world” he started a Web design company that he operated concurrent to his studies. Despite the heavy workload, Yves managed to complete the maximum allowable course credits per semester. ‘Alter fewer than thee years, be graduated near the top of his class. ‘Afier graduation, Yves wanted to do some- thing different with his ife.*Whatisthe most exit- ing thing I could possibly do?” he asked himself. ‘The more I thought sbout it the more 1 thought about taking the rest of my savings and going all out. I could always go back to ‘Switzerland and get jobif things didn't work ‘out, I should take some risk now, because I aam probably not going tobe able olter. ‘Wes decided to travel across the United States and to use the time to work on a novel about his experiences in America, He like the idea of telling astory but soon realized that the format of a novel ‘wasnt right for him. Although he had experience waiting business proposals, novels much _more descriptive content. By the time he reached the Grand Canyon, he began to fel ‘Then, asluck would have it, he met a Hollywood sereen- writer who was dining atthe same roadsie restau- rant After explaining the difficulties he was having, she suggested thate try writing feature-fm scripts, Wiritng a seript is diferent from writing a novel? she told him. *Novels often get overwhelmed in etal wheres seripts are straightforward. They are usually only about 100 pages long and every dozen pages of so, something interesting has to happen to dive the story end keep things moving” ‘As he continued his travels, his conversation with the screenwriter kept coming to mind, Even- ‘ually he landed in Los Angeles. I was so green, itis not funny. LA is nothing like Switeland. There are so many crazy people here and the trafic is horrendous. I have never experienced anything like it before in my life, He also soon realized that opportunities for business school graduates to work in the film industry were few and difficult to find. instead, most of the available jobs were for low-paying, unskilled post I could go to an agency and they would have stuck me in the mail room. Then, maybe after a couple of years, could work my way up. I was too impatient for that, Also, it ‘would not have given me the opportunity to work on scripts or actual film ses, which is ‘what I really wanted to do, Instead, he decided to focus strictly on script However, without any personal contacts, ‘he did not know where to go for support. He knew that the best way to become familiar with LA. and the film industry was to meet people, For that rea- son, he began to take acting classes and to volun teer on student film projects. Anywhere there was an opportunity to work nase nan capaci washer, watching and learning I would hold a boom, ot posi- tion alight, Basically, I would take any job T oul get ely jt ated to ean trogh wands-on experience. In LA. there are plenty reppomalinn pay pcan, to work for free, but it's not something you ‘an make a living at in the short run. ‘To support himself, be worked in restaurants and in various unskilled day-Jbor jobs. “They cer- tainly weren't the kind of jobs you might expect for ‘an educated person with a business degree” ‘One day, Yes received a call from his younger brother in Switzertand, who told him that one of his classmates was rated to renowned cinematog- rapher Ueli Steiger! Through this contac, Yes was able to meet Steger and a number of other Siviss WesCreations LUC: Alex Goes to Hollywood 381 expatriates, Gathering with other Swiss proved to Bethe nth Yes need More npn i opened dor to opportunist oka, Steiger separated his personal and profesional wie eee en Veeder version of his book, Steiger was candid, “It sounds like an interesting story, but I don't know what todo with this” he said. He told Yves to show it to Swiss documentary filmmaker Reto Caduff? Caduff read the sript, but wasnt interested inthe story. Never- theless Caduff aw potential in Yves and offered im job asa sriptwitr Fr the fist time, Yves had a fm industry poston that pod well enough to cover his cos of living, atleast fra few months. Movin’ In: The Movie Preproduction Meanwhile, Yves continued to promote his script, tiled Movin’ In. He approached several distribu- tors with proposals to fund the film, but none showed an interest, Most would not even look at the script unless Yves was represented by an agent. Some il hi to cme bak when te fl was Finished. When Yes told Cadff about the distrib- tors responses, he was not surprised. Ls Angeles had too many potential filmmakers fora disribu- {orto take a chance on someone with no experi- ence, he explained. Undaunted, Yves decided to approach the film asifitwerea startup Company. “I'm not the kind of person who gives up easly" he told Caduf."When ‘someone says ‘no’ to me, it just makes me want to ‘work harder to make it happen.” ‘With ite money of his own, Yves decided to approach private individuals with investment offers. He phoned every relative, friend and acquaintance, but found few backers, The main challenge was convincing potential investors that, dese his lack of expec be could produce film and find a distributor for it. Inthe beginning, did't get any help at al, because all { had was the script. I would give potential investors a summary of the 362 CHAPTER 12: DISTRISUTION AND SUPPLY CHAIN MANAGEMENT story. [told them who | wanted to get involved in the film and how much money: 1 seas going to need. ‘The first few investors were the hardest to convince, However, once he overcame that hurdle, thers became les reluctant, The more money he raised the easier it was to attract additional inves- tors. Some were convinced by promises that their ‘money would be returned within one yea of com> pileting the film, a promise that any experienced filmmaker Knew would be nearly impossible to Keep. But Yves believed in himself and his ability to deliver on his promise. By October 2006, Yves had raised $180,000, ‘enough to cover the cot of planning and produe- tion, He would eventually need to raise another $70,000 to meet the fils total projected budget of $250,000 (see Exhibit 1). That figure was consid- cred to be at the lower end of independent film production costs. Although many independent films cost less than S1 million to make, budgets of ‘up to $10 million were not uncommon? eee Other Rights (Note: owned by produces) ‘Set Decoration Camera Operations (arses 2100 Hlecie Operations 2200 Opetions 7500 Production Sound” 3000 Mectancl fects 3100) Special Visa EGS 3200 Set Opentions 53300" Waste Depa 3400 Makeup 6 Mir Depatiment 4% ‘3800 Location Departnitnt ) ))> 1 UBS 3600 Tansportation Department 3700 Videotape Department 300 Stcio Facies 3900 Amosplici® | 4000 Production Fim 6 Lab “4100 Eating) ae Post-Production film/ab (Post proaucion/Seund Ne ui 2% 00 — (5100) cao Facilities ‘Total AboverThetine | 23% ceaapinne recs Ty Total Above- and Below Thecine aeRO “The frst step was to hire a director, However, few had the qualities Yves was looking for. that threw you off ither they inexperienced, didn't make pression or they had other 2 professional is bout them that bothered me. Also, 1 new I had to find a person | could connect swith because I was going tobe spending «lot ‘of very intensive time with that person. Eventually, a friend introduced Yves to Griff Furst. Fursthad directed two independent fms and had played supporting roles in numerous television and film ions. Furst was also the son of, Stephen Forst, an established actor and director with many sucessful fim credit, including starting roles in Animal House, St. Ebewhere,and Babylon. ‘Because Movin’ In was going to be a low- budget film, Yves was doubtful that Furst would ‘agree to work with him. “I never thought I would have enough money to get someone ike Grif Yves admitted. By accepting the project, Furst seemed to ‘offer the first professional validation that Movin’ In ‘was a worthwhile srt. ‘Thenext step wasto find actorsand crew mem- bers to fil the many roles needed to make a Sim. Some positions were fled through online adverise- ‘ments on Craigslist and through acting and produc- tion websites. Wes and Furst reviewed résumés and ‘work samples and then invited selected candidates, (o interviews and casting sessions, One ofthe first positions tobe fied was the sound engineer, ‘When I hired my sound engineer, he was a person that made a really good impression ‘one, All the reels he showed me were great and sounded really cleat. His references from previous films were also very positive. Another critical crew member was the unit ‘production manager (UPM). Much like a chief financial officer (CFO), the UPM had critical financial planning responsibilities that induded ‘ost management, equipment procurement and negotiating salaries and benefits with the ast and ‘rew. The UPM also monitored the performance of cach unit and resolved any problems or complaints. ‘The directo, producer and UPM comprised the films senior executive team. Yves was Impressed ‘withthe UPM he hired for Movin’ In. Not only did she havea strong résumé, her professional attitude YesCreations LIC: Alex Goes to Hollywood 383 instilled confidence that she would be a capable unfilled. himself in the movie. “You are Swiss and you know the script better than anyone,” he sald. By this time, I was looking for anyone with « foreign accent who could ply the role of someone coming to the US. for the first time. In the process of casting peopl, | ‘would read the part ofthe script the foreign actor was supposed to play, and Griff jst liked the way I didi. After that, 1 went home and thought about it. Then I realized that ift di it, we wouldat have to pay another acter. Once Wes accepted the idea of playing the lead, they decided that Furst would ply the other lead role of an American who befriends Yves char- ter nd heh on is jouney. / Furst began to call on industry colleagues to ‘other important roles. One was Chriny Carlon Romano, who studied acting with Furst and had gone on to sarin a number of Disney pograms* In 2004, ‘Romano stared as Bell in the Broadway version of Disneys Benuty and the Beas. Other female cast members included Estelle Hari and Yangzom Brauen, both of wham had appeared in wel-known films and television programs, Harts for example, was a regular gust on Seinfeld, and Swis-Tibetan actor Yangoom Brauen was renowned for er workin German-language lms and American sisi movies. ‘The quality of the casting went far beyond anything Yves had hoped for with the funds avail- able to him, Christy agreed to work for alot less than she would usually get. She did us a big favor because she has known Griff for such a long time. I dont think [ could have ever paid (Ghrst a fair amount for her work. The same gees for Estelle Haris. They usually earn in one day what I paid them forthe entire time ‘we were filming. 384 CHAPTER 12: DISTRIBUTION AND SUPPLY CHAIN MANAGEMENT Having a cast of well-known actors would later prove valuable when Ywes needed to raise additional funds for post-production, Filming By November 2006, YwesCreations, LLC was ready to begin filming. With a crew of 70, the production had to run like clockwork, Makeup, wardrobe, and other support positions prove far mote important than Yves had anticipated. When someone was late or filed to do a proper job, the entire production had to be stopped. With limited time and funds, Yees could not afford many delays. California labor regulations and union guidetines ensured generous compen ion to anyone required to work more than ight hours a day. To ensure that all the require- rents were met, Yees kept detailed compliance records (see Exhibits 2, 3 and 4). “The most difficult members of the cast turned cout tobe those with the last experience. For some, Movin’ I was their first movie. “thought they would be happy to be in a film,” Yves explained, SCRIPT SUIERVISOR'S DAILY KEFONT ones Norn soomse pao, SCHRS tags MOOS SoS oon: fo ravanrasvous, roratopare _O LAB AAT LEXT= Heter{oro ‘aereasy siovet) a. ps ie. roranmscure: 110. 04s Jk — A 10H. Joao 1i}n_ .tv[n Tasioorteehes esr /emeacrsran scan (eg An alae Letts naire) Ai) ia Lee as a “epleacusesony 1% Mak ior bees) SCHEDULED CHNES NOP URES BAR —————— srecucsores (081 15 ovrovinl en woh) YesCreations LUC: Alex Goes to Hollywood 385 : ay — senes rrcovenox__Mowpckt __stlonvonay._____ amano, soos raars owns srs roo: cle. a Hine, te guiycat sion vaccine 8 eH wourwonn ee a omsnacirs tra ait xa na romero fad ay nln sla SOORN ee, be ina br a Brae yh pe himta te o bs i bs i r Brive ce i be B. be net ho 5 fr z x @ 7 7 So Tate st But people would complain, “My hair is know we are going to have a hard time not right, my clothes aren't right, my bringing Fstlle back to do it again, makeup is not right” They acted like they were accomplished stars even though they Once filming started, replacing cast members have never been in a movie. ‘vas particularly dificult, as it often meant retaking Once they are in a shot, it is very shots. Therefore, on many occasions, Yves felt he dificult to replace them, and they know it. had litle choice ut to aecommodate their requests. Especially if they are in a shot with Estelle Yves’ other problem was the sound engineer. Harris or some other famous person, they fier several days of shooting, he began to be ‘NTO \ aie LNIHOUNIYPY NIVHD AlddNS ONY NOLLNSMASIO #21 WaLdWHD see. ‘consistently late for shoots, argued with other crew members, and about trivial isues, ‘such asthe quality ofthe food. Yves was livid. "Ona Hollywood production, you are usually lucky to get smacks and here you gt full meals he protested, ing the engineer seemed to produce the opposite effect from what Yes had intended. Instead of improving his behavior, the sound engi- reer became even more problematic. After a while, ‘Yes became convinced that the engineer was delib- craey seeking to disrupt the production Finally, on the ninth day of shooting, the sound engineer was dismissed, which caused a criss because the senior members of the crew had to scramble to find 3 ‘replacement on short notice. Ainough Los Angeles had it share of unemployed sound engineers, not ‘everyone had the sil to work ona feature film. Yves ‘had to rely on word of mouth and hope forthe best. ‘When the new sound engineer arrived the nextday, Yves was impressed. He arrived on time, followed directions and had an assistant who ‘worked with him at no extra cos. After the frst few shoots, Yves and Furst reviewed the recordings and seemed pleased with the results. “As long as we have

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