In order to develop a product for young people and considering we know what it is to be young, we decided we had to develop a product that included most of youth likes and interests such as: music, dancing, social interaction, going partying, etc, Then “Club Ride” appeared as a great opportunity: a bus that gives an idea of pre-party, providing certain feeling of a small space of about thirty people where they can drink, laugh, dance, and make new friends.

What we offer is therefore not only a transport service but an entire experience of fun and music. Why? Simple! Inside the bus they would not only benefit from listening to great music and enjoying complete modern design (including sofas, poles, neon lights, etc.) but they will have the opportunity to drink for free as well. They will only have to pay the bus ticket which actually includes a free pass to the discotheques included in the tour and the drinks they have inside.

However this project is not able to satisfy every young man or woman in Madrid specially because we have to consider that there are at least 371.226 young people from 20 to 24 years old (not even taking into account the 102.532 immigrants that arrived this last year to Madrid). With this great amount of potential customers, it is impossible to take into account the whole market, it is necessary to direct all the attention to those man/ woman who would actually need this product. In order to obtain enough information about the costumer’s behaviour, such as to what nightclubs young people usually go, or prices they are willing to pay or even if they really were interested in the Club Ride idea, we were forced to make a survey to a sample of the population we were targeting.

Our marketing effort aims to young people between 18 and 25 years old, regardless of race, gender or religion…the basis has therefore to be more a psychographic one: we are looking for certain lifestyle, people that almost every weekend go out with their friends to certain nightclubs in order to have fun. Preferably they consume alcohol and use public transportation or drive. Thanks to the gathering of information we discovered that the 75% of people usually go from 1 to 2 times to a nightclub in a typical week, while the 25% go 3 to 4 times a week. There is no one that never goes out or that goes out more than 4 times per week.
Their discretionary income is important as well as this is the most likely to be spent. They can’t be really wealthy people otherwise they wouldn’t find any advantage in our service, but neither people who can’t allow our bus ticket price. Summarizing, this marketing project targets Madrilenian young people, or foreigners visiting Madrid (for as shown in the market research 58.3% come from abroad Madrid while the other 41.6% are from Madrid.) who would love to leave their car in their house and avoid paying taxis, alcohol and entrance, by including the three all into one, the bus ticket!

Thanks to this market research and the answers they provided we were also able to know their preferences and make important decisions when planning the Marketing Mix.

When deciding important facts about our distribution and especially because “Club Ride” acts as some kind of retailer for nightclubs it was really important to know the sociocultural forces that motivated young people to choose one nightclub over another. When selecting a club a 16.6% care very much about location and only go places near their house. An 8.3% care a lot and try to choose by location. Also a 16.6% don’t care at all whether is far or close to their house. The half of the population, this is a 58.3%, care about location but can go some other place if necessary. Every 91.6% pick public transport (including taxi) rather than driving (8.3%)

Our product is the service itself. Club Ride, as it is called, assures young people to go to the most famous and desirable night clubs such as Donfri, Campus, Kapital, Pacha and Cats for free!!! Thanks to the market research we discovered that the 75% preferred Kapital, then followed by a 66.6% where both nightclubs Metropolitano(donfri and campus) and Cats. Finally even though there was a lot of variety we chose the next in punctuation that was Pacha with a 41.6%. From one side to another, we have a mayor route along the city with several different bus stops where they can jump in to the entertainment of our buses and then to their favourite places. (See appendix for the route). Also we can offer special services like celebrating birthdays, bachelor parties (it can have an extra of striptease or entertainers).

The price of a product is the amount of money a seller is willing to accept in exchange for the product at a given time and under given circumstances. (Pride, Hughes, & Kapoor, 2009). Thanks to the market research we know that 8.3% usually spend over one night (including entrance, drinks, transport, etc.) 5 to 10 Euros. A 16.6% of the people used to spend from 31 to 40 Euros and the same percentage pay 21 to 30 Euros. The greatest percentage, this is a 58.3%, usually pay 11 to 20 Euros. This is not really encouraging because our price, due to some calculations (see appendix) has to be of 30 Euros. However a 25% is willing to pay a maximum of 30 Euros if worth it, so it could be reasonable. We can even get some extra funding with promotion in the bus stops.
Talking about promotion, at the beginning it would be the bus itself: the design of the bus is going to be colourful so that people in the street ask themselves what it is! Nightclubs will have fliers offering our services and of course eventually we can design an advertisement or a web page.

When talking about our company, there is no better way that by the so called Positioning Statement: To young adults who enjoy a night out in the city, our Club Ride is a club on wheels that allows you to get to your favorite club in a safe and fast manner while already enjoying its atmosphere, music and people.

Young people often face the problem of having to pay to many things for going out, having too much trouble going from one place to other, or entering nightclubs. We find there is an opportunity for our service in this market because transportation rates are rising. Also police controls are rising, therefore many people who before took their car when they went out to a club might change their mind because they might want to drink, but then would not be able to drive to another place. Also it’s a new way of joining transportation and clubs so that the whole night is a fun experience not only once you are in the club.

The principal strength is that our company provides safe and fun transportation to our customer’s favorite party places. It will appeal to our customers because it will include all aspects of their night: drinks, transportation and club, all paid at once. Also it will give them the opportunity to change from one place to another. The market research showed that people usually looked for big spaces, great music, cheap entrance, free entrance and free drinks and that is what we mostly offer! (Bundle pricing).
More than half of the traffic accidents in the last 2 years have been caused by alcohol, and almost in all of the accidents a third person was affected physically. Thanks to “Club Ride” we are not only preventing young people to drive while they are drunk, but guarantying affordable fun and excitement. Regarding this fact, legal and regulatory forces will give certain approval to the idea, although we have to consider the license to serve alcohol and to put certain bus stops in the streets.

It has however weaknesses: Even though it has a great deal to reduce expenses it might still be too expensive for some people. They might still prefer taking the taxi. Also our company will loose money if the clubs and bars in our route don’t feel like they are gaining customers or if certain prices change like gas prices, alcohol, etc. As any business we have certain threats to take into account as well: There is already a similar service in Madrid. It is called Party Buses. After doing some research we realized that it costs approximately the same as our service but the clubs and bars that it drives to don’t really appeal to our target market. Also it doesn’t include free drinks for the whole night. Still it is older than ours, therefore has certain market experience, brand equity, loyalty from certain costumers…etc.

APPENDIX:

QUESTIONAIRE AND RESULTS

We would appreciate you taking the time to complete the following survey. The information you will provide is necessary and very important for us in order to develop our new product. Read the instructions and notice that your responses are voluntary and will be confidential.

NAME_________________________________________
AGE___________

A) Fill with an X the space you consider describes your situation.

1) Are you from Madrid?
___ Yes
___ No

2) Do you live in Madrid?
___ Yes
___ No

3) In a typical week, how often do you go to a nightclub?
___ I never go.
___ 1 or 2 times
___ 3 or 4 times
___ More than 4 times

4) In selecting a discotheque, how important is convenience of location?
___ Very much. I only go places near my house
___ A lot. I try to choose by location.
___ Not so much. I care about location but I can go some other place.
___ Not at all. I do not care whether is far or close to my house.

5) Do you like to take public transport when travelling long distances, or would you rather drive?
___ Public transport (including taxi)
___ Driving

6) How much do you usually spend over one night at a discotheque? (Including entrance, drinks, transport…etc.)
___ 5 to 10 Euros
___ 11 to 20 Euros
___ 21 to 30 Euros
___ 31 to 40 Euros
___ More than 40 Euros

B) Answer the question in the space below.

7) What is the maximum price you are willing to pay for a night of fun in any disco? (Including entrance, drinks, transport…etc.)
______ Euros.

8) What discotheques or night clubs have you frequented during the last month? Please list all the places that apply in order of inclination, being 1 the most preferred and 5 the less preferred.

1______________________

2______________________
3______________________

4______________________

5______________________

9) What made you choose a discotheque over another? Example: kind of music, people, design, space…etc.)
________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

10) Do you usually go to more than one disco over one night?
___ Yes
___ No

11) If you answered yes in the preview question please answer the following, if not the interview is over.

Do you pay in both places?
___ Yes
___No

Thank you very much!

RESPONSES

1) Yes = 41.6% No = 58.3%

2) Yes100%

3) I never go = 0% 1 or 2 times= 75% 3 or 4 times= 25% More than 4 times = 0%

4) Very much = 16.6% A lot = 8.3% Not so much = 58.3% Not at all= 16.6%

5) Public transport (including taxi) = 91.6% Driving = 8.3%

6) 5 to 10 Euros= 8.3% 11 to 20 Euros= 58.3% 21 to 30 Euros= 16.6% 31 to 40 Euros= 16.6% More than 40 Euros= 0 %

7) 20 Euros= 16.6%
35 Euros= 16.6%
50 Euros=16.6%
30 Euros =25%
40 Euros=16.6%
60 Euros =8.33%

8) Kapital= 75% Metropolitano= 66.6% Cats= 66.6% Pacha= 41.6% Chester/Orange café= 33.3% Lemon= 25% Penelope= 25% Duom= 16.6% Lobby= 16.6% Ricorda= 16.6% Nature= 16.6%

9) People think that what makes great a place are: the big spaces, not being too hot, actual and modern music, cheap entrance, also they talked about free entrance or free drinks. The funniest answer was from a girl who said and we quote: “there has to be good looking guys, at least 3 per m2”

10) Yes= 33.3% No=66.6%

11) Yes= 75% No= 25%

MARKET RESEARCH

People Statistics:

People form Madrid, living in Madrid, from 20-24 years: 371.226 (el 1 de enero del 2009)
People form outsider Madrid, living in Madrid, from 20-24 years: 102.532

www.ine.es

Expenses:
Gas: We have decided to use biodiesel because it reduces CO2 emissions and costs. It is now at 0,85 €/l there is one gas station in Madrid near the tour: Nuestra Señora de Fátima, 22, Star Petroleum. If we are moving 10kilometres per tour and a bus usually spends 1,2 l/kilometre then each tour costs: 20kilometers (go and back) x 1,2 l= 12 x 0.85= 20.4 Euros
Driver: Per tour the driver will earn 60 Euros
Cleaner: The cleaner from all the night will earn 60 Euros.
Alcohol: Because the alcohol is cheaper in great amounts, we are going to spend 3 Euros for each person, that is 3x30= 90 Euros at each tour. Also we can start bay promoting certain brands in exchange of samples.
Entrance: 15 Euros x 30 people=450 Euros for the nightclubs

Forecast:

SALES FOR THE NEXT THREE YEARS
[pic]

According to expenses there are 210 Euros of profit per tour= (30eurosx30people=900)-(60euros/driver) - (30euros/cleaner)- (2euros/gasx30 people)-(3euros/alcoholx30people)-(15/entrancex30people)=

There are 2 tours per night, and two days per week: (210x4)= 840euros
There are 3 weekends per month x3= 2520 and 12 months in a year x12= 30240euros the first year.

If the second year we use more buses (two instead of one) the profits will increase to 30240x2= 60480 Euros, or expand the tour to more places increasing prices…
The third year it may be possible that there is not enough people to fill three buses, but we could expand from Madrid, to other type of parties, like bachelor, birthdays etc… Profit would then be of 70000euros prox. (Half of what we usually grow)