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AirTool Inc.
Location: 5426 California St. #2, San Francisco, California, United States United States
Founded in: 2007
Stage: Alpha (prototype)
Number of employees: 1-5
Short URL: vator.co/airtool-inc
Followers (12)
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AirTool Inc.

Revolutionizing Swimming
Startup/business
San Francisco, California, United States United States
http://www.theairtool.com
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Company description

AirToolIncorporated (AirTool Inc.) owns the exclusive rights to manufacture arevolutionary patented swimming device and a line of surrounding products thatwill significantly change the way people train for, compete in, and enjoy thesports of Swimming, Triathlons, and Snorkeling.

                                                          

The device knownas the AirTool™ is a snorkel that allows for users to swim or snorkel at anyspeed with comfort and efficiency never before experienced with a traditionalsnorkel.                          

 

Thecurrent design is suitable for swimmers of Olympic caliber and is also theultimate teaching and training device for recreational swimmers. The AirTool™’sunique patented features include an adjustable purging mechanism, “drymechanisms”, a personalized ergonomic and hydrodynamic fit, waterproof mp3player and radio, and adjustable “hypoxic pins”, which make the AirTool™ themost significant advancement in swimming over the last decade.  Thiswill change the face of any swim over a 50” (meter or yard sprint event) VictorWales, Head Men’s andWomen’s Swimming Coach, University of Hawaii

 

TheAirTool™ has vast market potential in the Swimming, Triathlon, and Weight LossEquipment industries. The market for the AirTool™ will be the 111M (million) inthe USthat swim either competitively or for recreation. The US competitive swimmer market comprises 15.6Mparticipants and is growing at 9%/yr, the affluent Triathlete market iscurrently 1.3M worldwide and growing quickly, and the US recreational swimming market is95.3M making it the most popular recreational activity.[1]

 

Thereis already substantial interest for the AirToolTM in themarketplace.  AirTool Inc. has receivedan offer to license the patents from Speedo, and has 125 initialpurchase orders from SwimOutlet.com, and SportsBasement.com.

 

Lane4USA has already agreed to be the initial distribution partner.  AirTool Inc. has developed a sophisticatedlaunch strategy encompassing print, electronic media, the Internet, attendanceat tradeshows and key sporting events with giveaways to industry leaders and‘influencers’ which are designed to create significant industry ‘buzz’ anddemand for the AirTool™.   

 

Initialfixed costs for setting up manufacturing in China, is $50K with a cost per unitof $15.  Wholesale price is $62.50 andthe snorkel will retail at $125. Breakeven is achieved after selling 1,912units, and valuation is $6.88M at a conservative 50% discount rate.

 

Ademonstration of the AirTool™’s revolutionary functionality can be viewed via theAirTool.comor at http://www.youtube.com/theairtool

 

 



[1]SGMA Sports Participation Topline Report 2005


Team
Business model

AirTool Inc. is a manufacturer of next generation snorkels and related swim products that will be selling its wares through retail partners and directly through the AirTool website to end users.

 

The following LAUNCH STRATEGY section is dividedinto two categories:  (i) Marketingand (ii) Distribution.  The firstyear and most critical phase of the marketing strategy (Feb 2011 to Feb 2012)is described in this section.[1]

 

Marketing Overview

 

AirToolInc. will begin to roll out a subtle, non-capital intensive, and grassrootslong-lead (pre-product launch) viral marketing campaign in February 2011 through participation at athletic events, print media, website exposure, andfree promotional gifts for identified industry leaders, athletes and“trendsetters” in California, Texas and other swimming hotspots.  The initial marketing goal is to establish adiscrete, hard-to-find, innovative brand that creates, through its exclusivityand performance, a buzz among the target market. The initial target markets areearly-adopters, with high disposable income (or who have access to schoolbudgets), who possess a willingness to pay $125 - $150 for a performanceenhancing product.  Thus, the abridged pre-launchmarketing plan is to:

 

February – April 2011

Create buzz and brand awareness through a long-lead “underground” marketing program consisting of postcard marketing, publicity/media, events, and giveaways to high-profile trendsetters

 

Approach retail buyers while giveaways slowly enter the public consciousness

 

March 2011

 

Launch in March with first product run in stores across our target markets and ordering on

the Website.

 

                  

Itemized Marketing Strategy Summary

 

Print Advertising

Launch postcard/print campaign to coaches andTriathletes to be distributed at Triathlon and swimming events and otherrelevant venues in February and April 2011 (pre-product launch) acrossCalifornia and Texas, New York, Florida. Postcards will feature an image of the Dual model in use or as shown onthe cover page accompanied by statements such as  “Get the most out of your workout”, “Welcometo Water World”, “Global Warming, Bring it On!” or rhetorical questions like“are you ready for the revolution?”

 

MediaKit/Look Book

AirToolInc. will create a high-end kit/brochure that will be used to communicate thebenefits and features and other significant information about AirTool™ and theDual model to “priority” publicity, sales, and business developmentcontacts.  The book will provides a guideto AirTool Inc.,and the snorkel featuring ‘how to’ user guides, product benefits and features,user testimonials, market information, suggested retail, ordering requirements,sample request information, accessories, release dates and pictures of athletesmodeling and using the product. The kit also reveals product specifications (e.g.colors, sizes, material, etc.). The media kit epitomizes AirTool Inc.’s focus on quality, and will onlybe sent to contacts deemed critical to the success of the AirTool launch.  The media kit will be approximately fifteenpages in length and printed on high-grade paper.  AirToolInc. will also produce a “one-sheet glossy” – a high-quality butsignificantly less expensive and abridged version of the media kit – for use in“lower-priority” sales and marketing efforts.

 

IndustryLeaders & Trendsetters

Approximately 150 AirTool™’s are to be usedas promotional tools; to be utilized and tested by industry leaders, topathletes and other trendsetters at athletic or other relevant events in Februarythrough April 2011; this includes product placement through management’s extensivelist of acquaintances in the swimming and water sports industry and at theLondon 2012 Olympics.  AirTool Inc. will follow a promotionalmodel similar to that utilized by Under Armour (see success story section).Therefore, AirTool Inc. will approach top swimming, Triathlon, and otherathletes to endorse and use the AirTool™ during training and competition. Thiswill initially be accomplished utilizing the current relationship with EvolveSports, sponsoring of swimming education through National Safe Kids Campaign,coaching references by Victor Wales, Kevin McKenna, and otherprofessionals.  Mr. Monnich and Mr.McKinnon, with their background in competitive swimming, will also enterTriathlon and other relevant events wearing the AirTool™.

 

Publicity

Press packages and promotional marketing kits willbe sent to editorial staffs, fashion editors and stylists at leadingpublications like Men’s Fitness, Triathlete Magazine, Swimming World,Swimming Technique and Outside.  Thehiring of a well-connected sports publicist will be a priority, in an effort togain relevant high profile electronic and brick-and-mortar press coverage to coincidewith product line releases.  

 

ElectronicMedia

Press packages and promotional marketing will besent to editorial staffs, writers, producers and key contacts including localand national television and radio programs like OLN, ESPN and theDiscovery Channel.

 

Website:www.theAirTool.com

EachAirTool™ snorkel will highlight the URL www.theairtool.com directing traffic tothe Website.  The Flash animation on thewebsite will provide detailed product information and demonstrate the snorkelscapabilities.  The site will state theuses of the AirTool™ – for training, performance, weight loss, and fun.  It will show the Dual model in operationduring a trial swim and a ‘flash’ element which will highlight the function ofthe hypoxic pins, the purge mechanism, the splash guards, and how the AirTool™can be customized for each individual. The site will include information on theavailable accessories and information on where to purchase AirTool™ products(store locations), Company mission, mailing list, and opportunity to receivediscounts or samples, see live demonstrations, and athletes endorsing theproduct.  The site will also allow usersto shop online, purchasing at the retail price plus shipping and handling allowingAirTool Inc. to enhance its margins. Customers will be encouraged to sign-up for email updates prior to thelaunch of new products.

 

Philanthropy

Drowningis the second leading injury-related killer of children ages 1-14, but thesetragedies can be prevented if parents practice four 'Water Safety Wisdoms'highlighted by the National SAFE KIDS Campaign. This message will be promotedon the Website, in the media kit, general advertising vehicles, and asappropriate on AirTool™ packaging.  Tofurther promote AirTool Inc.’s credo that sports and exercise equals life, AirToolInc. will make a donation from every purchase to funding swimming programs forinner city or other deprived children.

 

Events/TradeShows

AirToolInc. will ensure that the AirTool™ will receivesignificant exposure at sporting events such as Triathlons, and swim meets, andtrade shows. Notable events include Action Sports Retailer tradeshow (September2011), Escape from Alcatraz (June 2011), IronMan Hawaii Championship (October2011). Refer to appendix III for a full listing.

 

The goal is to create market buzz immediately andcost-effectively, and to develop demand for the brand through an understated,tempting, and excitable long-lead, marketing tactic.  An underground, networked marketing approachhelps insure that AirToolInc. is the first to market as the provider of the ultimate swimming device. 

 

Distribution Overview

The marketing approach above is executedsimultaneously with an equally selective and non-capital intensive grassrootsdistribution campaign, consisting of sales of AirTool™s to select stores like The Sports Basement and SwimOutlet.comwho have already written purchase orders for the ‘Dual’ AirTool™ model[2].The AirTool™ will in turn be available for purchase on the Website.   AirTool Inc. will expand its retail presenceby developing relationships with additional large and specialized sportinggoods retailers.  Initially distributionand marketing via catalog will be handled through Lane 4 USA[3],and/or Kiefer[4].  

 

Distribution Strategy

AirTool Inc. will leverage its retail store andindustry contacts (e.g., Sports Basement, TriSports, SwimOutlet.com variousswim coaches) to distribute its product across California.  AirToolInc. will also hire a third-party distributor or outside sales reps,who will work on a commission basis only, to achieve immediate productplacement in appropriate venues in those same cities[5].  AirTool Inc. will provide product in limitedand selective locations (creating an initial distribution “vacuum”): anapproach that aids consumer and retail demand for the AirTool™’s brand throughan exclusivity factor.  AirTool Inc. willalso leverage our relationship with Lane 4, who has ample distributiondomestically and internationally, including major retailers and cataloguers.

 

AirToolInc. plans to distribute (following pre-launch) 500 AirTool™s atapproximately five retail stores across California starting in April 2011. Salesin July and August will be primarily direct through the website or attradeshows/events. Thepricing for the ‘Competitor’ model will be $125 retail and wholesale $62.5. AirToolInc. believes the product has distinct advantages over the competition and thatits value proposition justifies the price, especially considering that high-endswimsuits start at $200 and that Aqua Spheres FM snorkel sells for $99.

 

Continuedtargeted print and Internet advertising will support distribution efforts.Marketing is budgeted to comprise 35% of all expensesinto perpetuity (see Financials). AirToolInc. will continue to roll-out new versions of the Dual AirTool™model in various colors, and launch available accessories. It is not anticipatedthat the ‘eclipse’ and ‘sprinter’ versions will be released until the secondyear.  This constant evolution will helphinder competition, generate ever-increasing sales, and ensure that AirTool™ isalways on the cutting edge.  

 

After the 1st year AirTool Inc. willcontinue to deepen relationships with top athletes as well as broaden the scopeto include athletes from other sports whose training regime also includes swimming.Additionally, AirTool Inc. will focus onworking with celebrities and other influencers who currently do not swimregularly, introducing them to the exercise and converting them to swimmers.This tactic will help strengthen the AirTool™ brand in the recreational swimmerand weight loss markets. AirTool Inc.  willenter the attractive ‘snorkeling’ market by partnering with retailers likeSnorkel Bob’s that have prime real estate and market share across global summervacation hotspots.

 

Tolimit financial risk and protect capital resources, AirTool Inc. plans tolaunch with a limited production run (“beta test”) of 3000 units in February(500 for retail, 150 for giveaways and 300 for website sales) and another 3000in June to be distributed over the course of the rest of 2011 in anticipationof the Christmas season and to fill shelf space in existing and additionalstores.   Management then will gauge market demand forQ3/Q4 2011 and beyond, and determine (i) the size of subsequent production runsand (ii) the best allocation of capital to maintain growth.

 



[1]See Appendix X for a summarized version of theMarketing Plan beyond year 1.

 

[2]Product will be available for purchase at theAirTool.com website but only atthe SMRP price, plus shipping and handling, pricing it higher than at ourchannel partner stores.

[4]kiefer.com

[5] Typically, independent distributors arecompensated with a 5%-10% sales commission. Outside Sales Reps generally charge between 10% - 20%. Distributor costsare 10% in the financials and Sales Rep commissions are 15%.  Beginning August 2011 management may solicitbuyers internally, without the aid of a 3rd party distributor orindependent Outside Sales reps.

Competitive advantage

AirTool™ Innovation

 

TheAirTool™ maximizes the benefits of swimming by taking breathing out of theequation. Newswimmers can learn to focus on proper and efficient swimming form without having to learn the complexities of breathingbetween strokes.  The perfect bodyform for freestyle swimmers is considered to be when the swimmersface looks straight ahead with the surface of the water hitting the center ofthe swimmers forehead.  This form offersthe least amount of drag across the shoulder area, thus allowing the body toskim or “plane” on top of the water versus a lowered head position, whichgreatly increases surface area. With the AirTool™ you can swim as slowly as youwant to, concentrating on maintaining form, ensuring a symmetrical workoutwhile eliminating all undue stress on the neck and back. Beginners will havethe form of a professional – a Matt Biondi, Mark Spitz or Michael Phelps -within weeks.

 

Byremoving the need to breathe on either side, the AirTool™ allows not only forbeginning swimmers to learn proper form more quickly, it also helps mitigate theapprehension of trying to breathe while swimming. Many beginning swimmers simplygive up on trying to learn because they are never able to get over thedifficulties of getting a sufficient amount of air.  The AirTool™ gives swimmers a large, steadyamount of air so that even the novice can breathe as much or as little as theylike. The AirTool™ willtherefore increase the total population of swimmers because it makes theactivity easier to learn.

 

Industry Innovation

 

Onesign that the swimming industry is growing is that companies are makingsignificant investments in research and development. The result has been influxof innovation which the AirTool™ will leverage. Recent developments in the lastdecade include:

 

·        Men’sand Women’s swimsuits that decrease drag and turbulence around the body.

·        Competitionwetsuits for open water swimming which provide superior hydrodynamics byincreasing buoyancy and reducing drag

·        Swimgoggles that offer UV protection, anti-fog, anti-glare and increasedhydrodynamic capabilities

·        Trainingdevices such as training belts, paddles, kick boards, and high performancefins.

·        Waterproofentertainment devices such as waterproof MP3 Players to alleviate tedious lapswimming and coach/swimmer communication systems

 

Theseinnovations illustrate the public’s insatiable need for better products thatenable them to train better and swim faster. More importantly, recentinnovations in snorkels (from our competitors) illustrate the markets readinessfor exercise, training and competition snorkels. The AirTool™ has significantadvantages over each and should immediately become the industry leader uponrelease. The latest snorkel innovations are detailed in the competition sectionand industry wide advances in Appendix X. The history of swimming demonstratesthat evolution is nothing new to the sport. Please see Appendix VIII.