Yeshiva of Greater Washington - Fall of 2006

Year Three Results:

All four companies were profitable in Year Three. This was partly due to the growth of the HRM (heart rate monitor) market. This was also due to the boys doing numerous smart moves. To list all their initiatives (marketing, sales, advertising, R&D, distribution, asset management, etc.) would be exhaustive, so this document aims to describe some of the most influential initiatives and the results they produced.

Heart Smart (M. Katz, L. Cohen, Bates, Fink, Oxman) continues to pursue a high-tech strategy for their HRM by investing in BlueTooth technology. Their high-tech products include a Heart Rate Monitor that has a BlueTooth headset, XM/FM/AM radio, and other high-tech technology. Their marketing strategy targets young casual exercisers and middle-aged yuppies. While their target markets have not embraced Blue Tooth Technology, they do enjoy the other high-tech features. Heart Smart finished Year Three with revenues of $17 million, Net Earnings of $6.8 million, and an ROA (Return on Assets) of 47.8%. This was the third best ROA for the year. Heart Smart has an overall average ROA of -18.3% and needs to take drastic actions in Year 4 in order to compete with current leaders Healthy Heart and Monitoring the World.

My Day Inc. (Y. Katz, Hillman, Kates, Pensak, Y. Cohen) continues to manage their costs well but have been unable to have the same kind of effectiveness with their revenue growth. My Day had success when targeting middle-aged business people and was extremely successful with the 60+ segment. (It bears mentioning that the 60+ segment is growing rapidly with 100% growth in Year Three.) Their high-tech product is very attractive to the business people while the low-tech product is a very good fit with the 60+ market. Unfortunately, My Day stocked-out on their high-end product. My Day Inc. had revenues of $8.8 million, earnings of $1.2 million, and an ROA (Return on Assets) of 29.8%. My Day has an overall average ROA of -33.6% and needs to take drastic actions in Year 4 in order to compete with current leaders Healthy Heart and Monitoring the World.

Healthy Heart (Schafer, Waxman, Goodman, Silverman) has two products. A high-tech product that incorporates GPS technology with the Heart Rate monitor so athletes (e.g. swimmers, bikers, runners) can monitor their heart rates as well as their workout distances, altitude of bike rides, etc. The price point and the profitability of this product are strong. The second product is more bare-bones and leverages the brand equity of their high-end product to promote sales. This two product strategy coupled with an effective distribution sales channel has been the key to Healthy Hearts success. In Year Three, Healthy Heart made a strong strategic move by investing in the use of the Ironman Triathlon name and logo for both their products. They had strong sales. They had revenues of $23.7 million, Net Earnings of $9.2 million and an ROA (Return on Assets) of 81.8%. Healthy Heart had second strongest performance for Year Three and currently has the second best Overall Average ROA with profitability of 7.6%. Coming down the home stretch, Healthy Heart is neck-and-neck with Monitoring the World.

Monitoring the World Inc. (Franco, Sragg, Silbiger, Sassoon) continues to finely tune their two products for their three market segments: young- to middle-aged wealthy, fit men, middle-aged wealthy, fit women, and the 60+ market. Monitoring the World was enormously successful with the 60+ market with their product specifications and their low price point. They captured 67% of the 60+ market. Their high-end product was also very popular with their other two markets. Not only is their product attractive to these customer sets, the marketing was both targeted and customized. They finished Year Three with revenues of $27.7 million (the highest in the industry), earnings of $10.1 million (the highest in the industry), and an ROA of 96.7% (the highest in the industry). Monitoring the World currently has the best Overall Average ROA with profitability of 10.2%. Coming down the home stretch, Monitoring the World is the team to catch and the team to beat. Yasher koach, Monitoring the World!