EMBA Final Project – Topic Proposal Form – Business Plan Name Rovshan Mammadov Institute MSM & ADA University Intake Intake 5 Student number ADA0517018 Date 2019, September 15th Business Plan Topic Ads over “FreeFi” Supervisor PhD, Elkin Nurmammadov (ADA University) Table of Contents Executive Summary I. Introduction ................................................................................. 7 1.1 Background .......................................................................................... 7 1.2 Opportunity ........................................................................................... 8 1.3 Business plan development ................................................................ 11 1.4 Limitation ............................................................................................. 13 1.5 Research Methodology ....................................................................... 13 II. Company Description ................................................................. 15 2.1 Vision and Mision ................................................................................ 15 2.2 Values ................................................................................................. 16 2.3 Service Description ............................................................................. 18 2.4 Key Partnership ................................................................................. 20 2.5 Growth Strategy .................................................................................. 21 2.6 Ethical Perspective .............................................................................. 22 2.7 Legal Perspective ................................................................................ 22 III. Industry and Market Analysis .................................................... 24 3.1 Industry Analysis ................................................................................. 24 3.2 Industry size and growth ..................................................................... 25 3.3 Porter’s 5 Forces ................................................................................ 26 3.4 Market Analysis. Market size and growth ........................................... 29 3.5 PEST Analysis .................................................................................... 34 3.6 Market Research ................................................................................. 35 3.7 Consumer expectations ...................................................................... 39 3.8 SWOT Analysis ................................................................................... 40 3.9 Business model CANVAS ................................................................... 41 IV. Organization and Management .................................................. 43 1 4.1 Human Resources ............................................................................. 43 4.2 Company Structure ............................................................................ 44 4.3 Operation Plan ................................................................................... 45 4.4 Working environment ......................................................................... 46 4.5 Equipment and Facilities .................................................................... 46 4.6 Business Location .............................................................................. 48 4.7 Customer Service/support .................................................................. 48 V. Marketing Plan ............................................................................ 49 5.1 Strategy Overview .............................................................................. 49 5.2 Branding ............................................................................................. 49 5.3 Pricing Strategy .................................................................................. 50 VI. Financial Plan .............................................................................. 53 6.1 Initial Investment ................................................................................. 53 6.2 Fixed and Variable Costs .................................................................... 54 6.3 Expected Cash Flow ........................................................................... 55 6.4 Projected Income Statement ............................................................... 57 6.5 Break-Even Analysis ........................................................................... 58 VII. Risks and Exit options ................................................................ 59 VIII. Conclusion ................................................................................... 60 References ................................................................................................ 62 Appendix 1 ................................................................................................ 66 Appendix 2 ................................................................................................ 67 Annexes .................................................................................................... 68 2 List of Figures Figure 1 Internet users trend in Azerbaijan ...................................................... 9 Figure 2 Customer segmentation illustration .................................................. 12 Figure 3 Ads tracking trend broadcasted on TV and radio channels ............. 17 Figure 4 Different advertisement options for free Wi-Fi users ........................ 18 Figure 5 Steps of the connecting to the offered free Wi-Fi platform ............... 19 Figure 6 Share of global advertising spendings .............................................. 24 Figure 7 Porter’s five forces ............................................................................ 26 Figure 8 Survey result about following video ads by customers ..................... 28 Figure 9 Dynamic GDP trend of Azerbaijan for the last 9 years ..................... 30 Figure 10 Forecasted GDP growth rate of Azerbaijan for 2019-2020 ............. 30 Figure 11 GDP per capita trend of Azerbaijan Republic ................................. 31 Figure 12 Average monthly salary trend of Azerbaijani population ................. 31 Figure 13 Logo of future partners – Mado and Park Bulvar ............................ 32 Figure 14 Different pictures from Mado restaurants ........................................ 32 Figure 15 General view of Park Bulvar shopping center ................................. 33 Figure 16 World Bank index of doing business in Azerbaijan ......................... 34 Figure 17 Age distribution of survey participants ............................................. 36 Figure 18 Indicator of participants educational background ............................ 37 Figure 19 Employment indicator of survey participants ................................... 37 Figure 20 Share of smartphone users among respondents ............................ 38 Figure 21 What people think about the advertisements ................................... 39 Figure 22 General structure of the company in the initial stage ....................... 44 Figure 23 Cisco switch ..................................................................................... 46 Figure 24 IgniteNet modems SunSpot AC wave 2 and Spark AC wave 2 ....... 47 Figure 25 Logo of the company ........................................................................ 50 Figure 26 Breakeven analysis chart for FreeFi ................................................. 59 3 List of Tables Table 1 SWOT Analysis of “FreeFi” ........................................................... 40 Table 2 Business model Canvas – “FreeFi” ............................................... 42 Table 3 Projected cost structure ................................................................. 53 Table 4 Initial investment contribution ......................................................... 54 Table 5 Fixed and Stepped cost projection for the First Year ..................... 55 Table 6 Projected cash flow ........................................................................ 56 Table 7 Projected revenue for the first year ................................................ 57 Table 8 Projected income statement ........................................................... 57 Table 9 Projected ROI ................................................................................. 58 Table 10 NPV calculation ............................................................................ 58 4 Executive Summary Advanced technology has become a main part of our life recent years. The majority of population uses mobile devices in daily activities, they do a part of their jobs, communicate with each other, do online shopping through them and etc. The Internet and social networks have also become an integral part of our lives and its popularity growing. The idea of this business plan is to take an opportunity of the advanced technologies and benefit from the Internet in setting a business in the country. We are going to provide advertisement services to population in free Wi-Fi zones which is expanding very fast since almost all public places are becoming free Wi-Fi areas. These places are becoming indispensable for marketing and advertising. On the contrary, other advertisement channels such as TV, radio, newspapers etc. lose their popularity gradually. In the first chapter of the project,