Copenhagen Business School Team Executive summary Business in ZOOciety Building a 5-year plan for Copenhagen Zoo Copenhagen Zoo, you find yourself facing competition from the increasing selection of entertainment activities in your geographical region, as well as high seasonality in visitors, and a low number of foreign guests. The question you need to ask yourself, before stating a new and realistic five-year plan, is: How can you grow your annual visitor base to 1.6M by 2020, without compromising your core values and competencies, whilst retaining an 8% profit margin independently of government subsidies? We believe that you can manage this, through a strategy that can be summarized in three words, namely: Engage, Expand and Escalate Engage: We propose initiating the ZOOciety program, a program that will position you as a global frontrunner in animal research and natural preservation. This program shall be the platform and brand from which all your projects in preservation and research stem, but also a new membership concept, that will replace your current annual cards by 2016. The new structure is based on a value and content driven loyalty program, not a discount driven one. Customers become active partners in your work, and part of the membership fee goes directly to projects. This enhances the value proposition of your park, and makes it not only a recreational offering but also a flagship for sustainability and preservation. Expand: We propose that you expand your current platform for funding of your projects, into involving crowd funding and an elaborated private funding program. This will generate large amounts of funding that can replace your current dependency on government subsidies, which can then completely be faced out by 2020. Escalade: We propose that you escalade your marketing efforts within three areas: urban presence, online presence and international presence. This will build a larger customer base both domestically and with tourists. This will be done through a detailed marketing plan involving Internet, television and smartphone presences, as well as an increased urban presence. If you can engage your members and visitors in both the projects and funding of Copenhagen Zoo, and escalade your marketing efforts to reach both domestically and with tourists, we believe you can reach a stable net margin of 7,8% and 1,56M visitors annually by 2020. Simone Amalie Ringmann Copenhagen Business School Benedikte Friis Mads Schou-Andreasen Strategy Proposal – Case Competition 2014 Johan Stubert Situational Analysis Market Engage Expand Escalate Impact Conclusion 1 “The greatness of a nation and its moral progress can be judged by the way its animals are treated.” Mahatma Ghandi Situational Analysis Market Engage Expand Escalate Impact Conclusion 2 Our proposal: Copenhagen Zoo’s 5-year business plan - and beyond Key Question: How can Copenhagen Zoo grow annual visitors to a sustainable level without compromising quality and core values, while maintaining a healthy profit margin independent form subsidies? ENGAGE EXPAND ESCALATE Visitors as members Funding activities and Marketing activities in of ZOOciety implement crowd order to attract funding international visitors Answer: By Engaging our visitors in the ZOOciety organization, by Expanding the funding platform to increase private funding, and by Escalating marketing activities – Copenhagen Zoo can achieve a sustainable visitor base of 1.56m visitors annually as well as maintaining an 7.8% margin independent of government subsidies Situational Analysis Market Engage Expand Escalate Impact Conclusion 3 Copenhagen Zoo has an unstable bottom line – this is unsustainable in the long run Profits are fluctuating Copenhagen Zoo’s profits over time! DKK 12 10.4 DKK 10 DKK 8 DKK 6 4.8 4.7 DKK 4 DKK 2 DKK 0 Earnings in DKK million DKK Earnings in million 2007 2008 2009 2010 2011 2012 -DKK 2 -1.0 -0.7 -2.2 -DKK 4 Source: Company annual reports! Copenhagen Zoo needs to improve margins and stabilize earnings Situational Analysis Market Engage Expand Escalate Impact Conclusion 4 Government subsidies will continue to decrease in the future – and annual card sales have dropped Government subsidies are decreasing Annual card sales decreasing Copenhagen Zoo’s government subsidies! Number of annual cards sold! DKK 19.0m 120,000 115,000 DKK 18.5m CAGR 110,000 -4.0% DKK 18.0m 105,000 100,000 DKK 17.5m CAGR 95,000 DKK 17.0m -2.1% millions) millions) 90,000 85,000 DKK 16.5m Annual card sales 80,000 DKK 16.0m Government subsidies (in DKK Government subsidies (in 75,000 DKK 15.5m 70,000 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 Source: Company annual reports! Source: Company annual reports! This situation creates a need for Copenhagen Zoo to act now Situational Analysis Market Engage Expand Escalate Impact Conclusion 5 Our proposal: Engage – Expand - Escalate Engage Expand Escalate This three-legged strategy will emphasize the science and conservation CIETY activities of Copenhagen Zoo, improve the funding platform, and increase the §" Introduce §" Develop §" Escalate foreign and ZOOciety funding platform marketing domestic visitor concept §" Implement activities and base. §" Emphasize crowd funding presence in the scientific and as source for city conservation funds §" Increase foreign activities visitor base Situational Analysis Market Engage Expand Escalate Impact Conclusion 6 Engage Expand Escalate Situational Analysis Market Engage Expand Escalate Impact Conclusion 7 Bridge the gap between Science, Business and Education through ZOOciety Science CIETY Education Business Situational Analysis Market Engage Expand Escalate Impact Conclusion 8 The CIETY project will have dual function purpose – platform for projects and membership concept Platform for Membership science and natural concept preservation •" Platform for scientific •" Active involvement research •" Sense of ownership •" Platform for natural preservation projects •" Content and value driven loyalty •" Brand and focus of Zoo programme – the CORE •" Retain members and obtain new visitors Reposition Copenhagen Zoo into frontrunner in natural preservation and actively involve visitors in the vision and work Situational Analysis Market Engage Expand Escalate Impact Conclusion 9 ZOOciety will still be an annual membership, but with added value CIETY Same features as basic annual card Added features as price contributes to ZOO projects Events, speeches, movies, special openings and more included Special quarterly newsletters with a positive, progress-focused perspecitve CIETY Situational Analysis Market Engage Expand Escalate Impact Conclusion 10 Integrate the old architecture with new elements Align the look of the new and old enclosures Situational Analysis Market Engage Expand Escalate Impact Conclusion 11 The CIETY project will be based in the Old Elephant House A documentary cinema showing films about preservation projects (e.g. the South East Asia EAZA project) Exhibition hall with an informing and educational perspective on the current projects (in-situ, ex-situ and EAZA) Glass pavilion with room for events, crowdfunding office, ZOOciety shop and recreational areas Situational Analysis Market Engage Expand Escalate Impact Conclusion 12 Engage Expand Escalate Situational Analysis Market Engage Expand Escalate Impact Conclusion 13 Implement crowdfunding model to raise funds for specific Copenhagen Zoo projects Crowdfunding has proven Over $2.7B raised in 2012 – $5.1B successful expected in 2013 $6.0 $5.0 $4.0 $3.0 $2.0 funding (in USD billions) (in USD billions) funding $1.0 Total amount raised fromcrowd Total $0.0 2010 2011 2012 2013 (forecast) Source: MassSolution Crowdfunding Industry Report! Copenhagen Zoo has great potential to raise funds from crowdfunding Situational Analysis Market Engage Expand Escalate Impact Conclusion 14 Crowdfunding on social media and website to create attention for projects Chimpanzee preservation project in DR Congo Campaign Goal: 600.000 kr. 48% Funded Help Fund New leopard enclosure Campaign Goal: 1.200.000 kr. 24% Funded Help Fund Playground for the silk monkeys Campaign Goal: 350.000 kr. 83% Funded Help Fund Situational Analysis Market Engage Expand Escalate Impact Conclusion 15 Engage visitors and enable them to actively take part in crowdfunding 1. Involves visitors 2. High interaction 3. Sense of ownership Situational Analysis Market Engage Expand Escalate Impact Conclusion 16 Engage Expand Escalate Situational Analysis Market Engage Expand Escalate Impact Conclusion 17 Increases of creative marketing efforts will increase visitor amount You have strong presence offline… Increase presence: Expand communication §" online team: §" internationally §" employ additional staff HOW? §" interactively §" increase budget §" special IT- development team Situational Analysis Market Engage Expand Escalate Impact Conclusion 18 Involving visitors online enhances and improves the zoo-experience Re-design and update website §" modern design §" update content Zoo-app – interactivity §" event calendar §" treasure hunt §" animal profiles §" map §" mobile payment system §" pre-purchase tickets Social media §" Instagram §" competitions – ex. “Zoofan” §" social media marketing Situational Analysis Market Engage Expand Escalate Impact Conclusion 19 Emphasizing international profiling and marketing will attract tourists Vision Be part of Copenhagen’s top tourist attractions Tourists 5-10% of total visitors 1,600,000 Expand tourist base 1,400,000 0,57% §" international profiling 1,200,000 of all tourists