Modu optimizing the product line Harvard Case Solution & Analysis

Modu optimizing the product line Case Solution


Dov Moran was a famous seasonal entrepreneur in the Israeli market. He brought innovative solutions in the technology market of Israel. Currently, he is working on a smartphone to achieve his goal to bring revolution and something extraordinary for the electronics market. Moran founded the flash drive in 1998 and when he was presenting his idea to high net worth investors in New York, he found his laptop was unable to boot.

Afterwards he came back to Israel with a vision to invent a portable device, which can carry huge data files. His company’s name was M-systems and after hard work of two years, in late 2000, the company launched its device “Disk On Key”. This was the world’s first flash drive and made sales of $5 million in its first year of launch. Till 2006, the company’s revenue stream grew up to annual sales of $1 Billion after which it was acquired by SanDisk Corporation for $1.6 billion.

Later on, Moran founded a new company, “Modu” with a vision to launch a headset in electronics market with value added and innovative features. He envisioned a smart phone with the capability to carry data like flash drive and could be inserted in a variety of enclosures. A huge amount of money was required to finance this idea. Moran was famous for investing in calculated risk projects and generating higher returns on those projects.

Moran altogether raised $100 million in 2007 and 2008 from genesis partners, SanDisk, Gemini, and Grey lock partners. Moreover, he also had $1.6 billion proceeds from the disposal of M-commerce. In order to make the best use of these resources, Moran contacted the technology giants of Israel and tried to make the most effective team of all-time.

The attributes of new headset would be its functionality and customization, which will allow users to transform their phone in their own style. If the person is working on any word file or creating an office document, then in such a case, the QWERTY type keypad will be the most effective as compared to touch screen. Along with this feature, MODU would launch this set with three jackets, which were invented by company itself after carefully analyzing the target market.

According to Neal Zod, the director of marketing at Modu, this phone possesses three key distinctive competencies, which makes it unique from the competitors in the whole industry. Those three characteristics comprise of i) Flexible functionality, ii) Aesthetics, and iii) modern (protection from obsolescence). The company segmented its customers in three categories such as young professional, fashionable youth, and gadget geeks.

Problem statement/Issues identified:

The research and development team with collaboration of marketing team of the company,came up with 8 prototypes of the jackets. Out of these eight jackets, the company had to select three jackets in which one would be for the target market because of limited financial resources. Below mentioned are the eight jackets.

  1. Road Warrior
  2. PWNED
  • Contact
  1. Libris
  2. X1
  3. Silver Lake
  • Volt

Among these eight jackets, now management has to select best three for one target market. Moreover, among available potential markets, management has to select one effective target market. How profit would be maximized?

Case Analysis

Jackets analysis

Road warrior: Road warrior was offering both touch screen and QWERTY keypads with large screen, MP3 player, photo camera, high resolution, and device interoperability. Its shape was similar to Blackberry.

PWNED: This jacket was offering two unique features, i) Optimized for gaming and ii) interoperability for gaming. Its other features were similar to road warrior except video camera and loud speakers. The conflicting thing about this device was its size and shape, which looked similar to PlayStation Portable (PSP).

Contact:This jacket features QWERTY keypad, slim design, MP3, Photo camera, and device interoperability. It was similar to road warrior however, its keypad size was smaller with two alphanumeric letters per key........................

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