Activity 10: Storyboard Resolution: Scentologic Case Study and Data Analysis 

Scentologic Inc is test marketing a smart product that fills any home with a time and season appropriate aroma. Scentologic's home device is an outgrowth of research from the MIT’s Olfactory Sciences Program (Course 19) and is its first foray into the consumer market after years of developing cutting edge scent technology for industrial and commercial use.

Energizing scents in the morning have been shown to lead to a more productive day. Soothing scents in the evening, are proven to make it easier to fall asleep and stay asleep. The home device detects room size so as to fill the room with just the right amount of aroma, and adjusts based on the number of occupants in the room. It also offers seasonal smells -- pumpkin spice in Fall, huckleberry in Spring. 

Consumers purchase the device and a monthly subscription for the smell service. Every month, customers receive a cartridge, similar to a toner refill, that can be used to generate any scent. Scentologic has set the initial subscription price at $12 a month and is still testing different prices for the device. Each cartridge costs $1.50 to manufacture and ship. Scentologic is conducting market research in various test markets to determine potential demand based on device prices ranging from $100-$400. The device costs $350 to produce. To build the device, Scentologic must pay $300K annually to the manufacturer in addition to the cost of production.

After extensive work and a year of sales in select test markets, your team and management are comfortable that you have a solid baseline prediction of how Scentologic’s consumer device will perform nationally over the next five years at various device prices and a $12/month subscription rate. This is based on ongoing sales in several test markets. Management isn’t ready to set the final device price yet, but in the meantime they have asked you to evaluate the impact of several additional scenarios.

You are asked to evaluate each of the four scenarios below. Over the last three months, you have designed and run small tests for these scenarios on top of the pricing tests currently being run. You have taken those results and projected the impact of each scenario on sales and gross profit for the entire company over the next five years (fill in the excel sheet: Activity 10 Scentologic Profit). Management is interested in the profit impact of each scenario as a whole as compared to the baseline. Scentologic defines a change to be material if its impact on expected gross profit is greater than 5%. Anything less than that is considered noise.

Data for each scenario is in the tab Activity 10 Scentologic Profit.

Use that information to craft a communication for the following situation:

• Audience: Scentologic Senior Management Team 

• Deliverable: Create 4-5 slides max with 1 big idea, 1 resolution landing page, 2-3 detailed resolution slides. The format for the detailed resolution slide(s) is open; You may use any visualization.

• Your presentation should

o Remember that even though management picked these scenarios, that was three months ago

o Remember you are not asked to present any setting, context, or conflict slides because of the specific nature of the case. When making the resolution, have these things in the back of mind. 

o Provide both findings and next steps based on each scenario

 Avoid making device pricing recommendations. That will be decided by a different team at a different meeting.

o Not fabricate additional analysis. Management wanted a fast read out, and this is what you had time to do

o Keep in mind that changes less than 5% are considered noise by this team.

1. Scenario 1: Change the Device Color Shell

Scentologic discovers that they can get a discount on a part that is identical to one they currently use for the product casing, except in a different color. The cheaper part is dark grey, rather than a lighter, more metallic grey. The colors are very close, and the change reduces the production costs from $350 to $300. No one on the team thinks consumers will notice or care about the change.

2. Scenario 2:  Increase Advertising

Scentologic is considering an increase in advertising to drive increased demand. They believe that their consumers are likely to stay up-to-date on technology, and that more advertising placements will increase awareness and drive increased demand.

3. Scenario 3: Change Manufacturing Locations

Scentologic's manufacturer has a plant with the same capabilities in Detroit as their current facility in Arlington. The Detroit factory has greater long-term capacity to produce Scentologic's device. Scentologic has decided to do a pilot run at the new factory, when they are relatively small before they need the larger capacity. They do not expect a change to the products from the Detroit facility.

4. Scenario 4: Increase the Subscription Cost

Scentologic believes that it has the opportunity to capture more value by increasing the subscription fee. The company worries that the $12/month subscription price positions the product as “cheap” and will scare off customers. They expect a subscription price increase to impact demand, and they want to understand the impact.

This purpose of this exercise is to show how data analysis and data visualization can be used in the later parts of your data presentation (resolution steps).

You applied your data analysis, data viz and data storytelling skills in key business areas:

Data Science, EDA, Descriptive Analytics, Statistics

Business Communication, Persuading with data, & delivering/defending your data

Marketing, A/B testing

Pricing/Planning Analysis

Revenue Analysis

Economics, Product Demand and Supply 

Management Consulting

Manufacturing and Process Control

Visualizations in the Everyday World (News/Media, Weather Reports/Hurricanes)

Dataset