PlayShifu - "The Why"

In this tech era, each parent will agree that it is super tough to keep the kids away from screens.

Today is the time when parents have limited time & energy to spend on their child after long days at work & otherwise.

At the same time, Gen Alpha has been characterized by a high level of perception, unprecedented comfort with technology & global connectivity. (as per various research papers on Gen Alpha generation, for example this one by Arizona School Counselors Association)

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Today’s parents have two burning needs:

1. They want their child to be meaningfully engaged without requiring much supervention. 
2. They want their kid to be smart

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Problem statement:

How to meaningfully engage today’s tech savvy generation & make their screen time a growth enabler?

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Value proposition:

PlayShifu’s solutions are spot on at the juncture of parents’ needs for meaningfully engaging their child & child’s need of endless exploration and entertainment.

PlayShifu not only productively engages the young minds but also gives the parents the confidence that their kid is learning while enjoying the play time!

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In essence, here is what PlayShifu solves -

Making screen time educational time packed with engaging activities.

Product

1. Product Portfolio:

PlayShifu has three toy platforms with a total of more than 16 games designed to be played using these platforms.

• Shifu Orboot (series of AR-based educational globe for kids)
• Shifu Plugo (STEM toy kits that teaches math, words, construction, music & more)
• Shifu Tacto (set of interactive tablet based board games with focus on learning & education).

2. Market:

PlayShifu sells its products across 14 countries.

North America & Asia are the top contributors to the revenue.

3. Target Audience:

PlayShifu targets the tech savvy parents with high disposable income

4. Unique selling proposition:

Turn kids' screen time into educational time packed with engaging activities.

5. Revenue:

Estimated revenue is USD 9.4 Mn

6. Funding & progress:

The startup has raised round B till date with total funding mounting to USD 28.4 Mn.

Round C of USD 6 Mn is under talks. The founding team plans to use the capital for expanding product portfolio & distribution reach.

Typically PlayShifu has ventured into a new product vertical after a fund raise. It launched Shifu Tacto in Aug of 2021 after raising round B in March 2021.

According to a news article, the founder has claimed that the revenue in FY 24 will be 50% higher than revenue in FY 23 & the company will turn EBITA positive by end of the year.

PMF Validation:

Estimated Revenue & Valuation

• PlayShifu's estimated annual revenue is currently $9.4M per year.
• PlayShifu's estimated revenue per employee is $70,000
• PlayShifu's total funding is $28.4M.
• PlayShifu's current valuation is $645M. (April 2021)

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​Employee Data

• PlayShifu has 130-150 Employees
• PlayShifu grew their employee count by -18% last year.

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​Repeat usage:​

There are different toys based on one of the three platforms.

Once a platform is purchased, customers tend to purchase different games that work on the same platform. Also, explore other products. Due to tech & educational value, these are top choices for gifting purposes.

User Research

User research and their profile

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ICP Prioritization Matrix:

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Customer value addition tied to customer pain points:​

The overall qualitative observation of product reviews on marketplaces like Amazon, talking to customer (parents) and users (kids), talking to retail store representatives, indicates that PlayShifu solves following pain points for its customers:

• Customers like the educational value of the product & interactive way of learning
• Ease of use with compatibility with multiple devices
• Little to no need of supervision

TAM & SAM & SOM

TAM

Assumptions: These data are till 2023. Household segmentations is based on Annual report on children in India by  Ministry of Statistics and programme Implementation, Government of India.

Population of children age 0-14 years – 400 million

Segmentation on the basis of households

Rural Household – 70%

Urban Household – 30%

Income Households

Lower Income Households – 70% = 280 million

Middle Income Households – 25% = 100 million

High Income Households – 5% = 20 million

*Assuming 30% of low-income household market is unfeasible to cater, so addressable market in lower income household = 280 – 84 = 196 million

Average spend in a year

Low income households – INR 200-250 ~  $3/Year

Middle Income Households - $6/Year

High Income Households - $ 20/year

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Considering CAGR of 10% for toy industry for year 2024-2029, TAM is expected to be at $3 billion in 2029.  

(Source: Statista, pib, Imarc)

SAM

Serviceable market out of total addressable market is high income households

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By 2021, No of rich household who have income greater than 30 lakh pa is 10.66 million.

By 2031, rich household number is expected to increase to 35.15 million with a CAGR of around 13%

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*Source: ICE 360 survey, PRICE

Assumption:

• 30% of their income goes to discretionary spending
• 0.5% of their discretionary spending on toys for "Striver Class"
• 0.75% of their discretionary spending on toys for "Near Rich Class"
• 1% of their discretionary spending on toys for "Clear & Sheer Rich Class"
• 2% of their discretionary spending on toys for "Clear & Sheer Rich Class"

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Serviceable market (SAM) based on high income household and their spending is $396 million.

It is expected to grow to $1.6 billion in India by 2031

Acquisition Channel

Based on channel selection framework, we prefer to cover Organic and Paid channel to grow and scale our business.

we saw opportunity in growing our business through organic channel and then paid ads on various platform.

Rationale to chose acquisition channels

• The research on organic channel of PlayShifu (details later) point that there is a lot of scope of improvement.
• The brand is still in its early growth stage. It requires higher brand recognition to stand out in the crowded market.
• The target audience is tech savvy people with high disposable income, who spend good chunk of time in the online world. This makes them suitable for digital targeted ads.
• The product being niche (AR based) need customer education & community building for better adoption.
• The current focus of branding which is 'AR based' toys seems to be not resonating with larger audience who might me looking for any learning/educational/STEM based toys. This knowledge gap needs to be addressed.

Conclusion:

Organic reach & paid Ads are the right fit to achieve following objectives:

• Reach target audience to educate them as well as increase brand awareness
• Capture the value in larger audience by breaking current mold of 'AR based toys' & position brand as 'new age educational/STEM based toys'

Organic

Domain (/page) Analysis – Playshifu.com

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Insight:

we get the answers to the questions like "How & which links are attached to this domain" and "what are the key keywords matching for this domain". Based on these results we are able to generate further insights about keyword analysis

SERP Analysis

SERP analysis result for keywords “toys, tech toys, toys for 5+ years, gift toys, AR toys, stem toys, learning toys” is as shown below:

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Abbreviation:

PA – Page Authority: Predicts a page's ranking potential in search engines based on an algorithm of link metrics.

DA – Domain Authority: Predicts a root domain's ranking potential relative to the domains in our index. Use this score to compare your likelihood to rank above that of your competitors.

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Insight:

When searched for toy related above mentioned keywords, SERP results showed us some great insights. The results had Amazon & Flipkart, two major e-commerce channel for toy search and results as top rankers.

Some major competitors in Indian toy market are able to position themselves among top 10 results on Google.

Key Insight:

These keywords have snippets as SERP features which is allowing them to be at top of the result.

By referring "Mozlow's hierarchy of SEO needs", use of Snippet/schema markup make the domain stand out in SERPs which is lying at the top of pyramid.

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When tracked snippets feature for our product "PlayShifu.com", it shows zero featured snippets while searching for these common user keyword searches. Result image attached below.

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Keyword Research & Analysis

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Abbreviation:

C – Commercial: The user wants to investigate brands or services

N – Navigational: The user wants to find a specific page or site

I – Informational: The user wants to find an answer to a specific question

T – Transactional: The user wants to complete an action (Conversion)

KD – Keyword Difficulty: Keyword Difficulty shows you how hard it would be for a website to rank organically in the Google top 10 for the analysed keyword. The higher the percentage, the harder it will be to achieve high rankings.

CPC: The average price in INR advertisers are paying for a user's click on an ad triggered by a given keyword (Google AdWords).

Volume: The average monthly number of search queries for a given keyword in the last 12 months.

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We did competitor analysis using above mentioned keywords (in table), below is the result

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Insights:

• Our product has greater visibility among its peers, but it lacks keywords match.
• Search volumes is in achievable higher range as that of our competitors
• Referring to keyword table, for keywords under "use case" and "competitor", avg CPC is low as compared to our product.
• KD for our competitor is low similar to our product along with low CPC.

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Paid Channel

Rationale for using paid Ad as measure of client acquisition:

​Qualitative:

• PlayShifu is in the phase of establishing itself as a premium toy brand & wants to target a niche customer base
• The PMF is validated by rapid growth in the last 4 years since inception in 2016. Hence, expanding reach through paid ads makes sense at this stage.
• The target group consists of tech savvy parents who spend a lot of time in the digital world which makes them a good fit for paid digital ads.

Quantitative:

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Revenue side:

List price for single unbundled product: INR 1700 - 2000

Assume on an average, price for single unbundled product: INR 1850

Usual discount: 10-20%

Actual selling price (revenue/product): 1360 - 1600

Average Selling Price is INR 1500/product

Revenue to the company depends on commission to various marketplaces and shipping cost.

Assuming 20% flat commission on listed price, the revenue to company is INR 1200/product

Assuming 70-100% markup on unit manufacturing cost to get to the listed price, the unit cost of the toy comes up to INR 600-700/product. 

We have unit margin of INR 500-600/product

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Cost side:

Cost of paid ads on various platforms is as below:

1. Amazon -  INR 25-30 per click for sponsored products
2. Flipkart - INR 8 per click
3. Instagram: 
4. 1. CPM (per 1000 impressions) - Rs. 7-13
   2. CPC (per click) - Rs. 2
   3. CPV (per view) - Rs. 1.5
5. YT (Source)
6. 1. Skippable Pre-roll Ads: ₹0.82 – ₹2.47 per view (CPV)
   2. Skippable Mid-roll Ads: ₹0.75 – ₹2.25 per view (CPV)
   3. Non-skippable Bumper Ads: ₹8.33 – ₹20.82 per thousand impressions (CPM)
   4. Display Ads: ₹0.20 – ₹1.00 per click (CPC)

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Based on cost of paid ads on various channels, and margins available per product, Expected Website/App conversion rate is as below

Identifying right channels for paid ad:​

The goal for paid ads is two fold as follow:

1. Increasing brand awareness & correcting the brand positioning
2. Conversion campaigns

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Increasing brand awareness & correcting the brand positioning​

Success metric: 

• # of unique users directed from ads to website: We are expecting increase of 10% in unique visitors count in first month, and incremental increase of 10% following each month ( for next 6 months)
• Click through rate.

Additional parameters to monitor:

• Tracking brand mentions in relevant keyboards across social media platforms & search engines ​

Metric used: Time spend, reach

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​Since this is going to be a brand awareness campaign, we would like to target ICPs on the channels which reach a higher audience and ICPs spend most time on.

The channels chosen for brand awareness campaigns are: Instagram & Facebook. OTT is dropped for the time being due to high cost.

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Core message: 

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“Let’s make screen time educational time”

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*(This solves for goals of both the ICPs)

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#Note: Following are the sample creatives to convey the thought process & idea of the campaign with illustration.

The plan is to get these creatives done from freelancer or creative team of the company & experiment around different sets of creatives that convey the core message.

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Sample ads:

1. Instagram poster:

Description:

This is a split image,

Left side shows a child slumped on a couch, eyes glued to a tablet with a bored expression.

Right side shows a child actively engaged with a PlayShifu toy, smiling and learning.

Headline: Screen Time? Make it Learning Time!

Caption: PlayShifu toys turn screen time into fun & educational experiences. Experience AR based learning toys!

Visit playshifu.com to explore! #PlayShifu #LearningToys #EducationalScreenTime #stemtoys

CTA: Swipe Up/right arrow (linked to PlayShifu shop page)

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2. Instagram Video

A child laying on the couch is passively staring at a tablet screen. A voiceover (friendly, playful) says: "Is screen time turning into mindless time?"

In next scene, a child is actively playing with a PlayShifu toy (a visually engaging toy like Orboot Globe). The child laughs and interacts with the toy on the screen. The voiceover continues: "PlayShifu toys make learning fun and interactive!"

In the scene after that, a split-screen with the child playing with PlayShifu on one side and happy learning facts on the other. The voiceover concludes: "Turn screen time into a learning adventure. Experience AR based stem toys Visit playshifu.com to discover more!"

CTA: Swipe Up/right arrow (linked to PlayShifu shop page)

3. Influencer marketing

We can tie up with influencers and track the metrics to see the progress & take a decision on to drop or continue this sub-channel

Examples of influencers to tie with (on Instagram):

• Tiny_tot_amayra
• bizzy.as.a.baby
• Palakag21
• agu_ki_gupshup

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Conversion Campaigns

Objective of the campaign: 

1. Increasing the sales
2. Monetize increased brand awareness due to brand awareness campaigns

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Success metric: % of users making a purchase after seeing ad

Additional parameters to monitor: Growth in overall sales (channel agnostic)

Metric used: Purchase intention, targeting

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For the conversion campaign, we will focus on channels which will have users with high purchase intention & which will allow us to accurately target these customers.

The ads for conversion campaigns will be targeted to particular ICPs, catering to their goals.

ICP 1: Parents who want their child to be a high achiever

• Intense scene where the headmaster is announcing a prestigious competition during a school assembly.
• Next scene starts with a split-screen. Left side shows a child confidently presenting a project in class, receiving praise from the teacher. Right side shows a child engaged with a PlayShifu STEM toy (say Tingo on the tablet).
• Text appears at the end: "Boost your child's learning edge. PlayShifu makes screen time productive with AR."
• Call to Action: "Shop Now" button

ICP 2: Parents who want the best learning toys for their child

• A screen with eye-catching colors with vibrant music. Text appears - Is this you? Along with voice over.
• Scene starts with a montage of frustrated parents searching online for "best educational toys."
• In the next scene a child is excitedly playing with a PlayShifu toy (e.g., OSMO coding set).
• Text appears at the end:"Award-winning learning toys in today’s world. Enhance your kid’s learning experience with PlayShifu’s AR based toys.
• Call to Action (CTA): "Explore Now" button

#Note: The sample creatives (Ads) mentioned for Brand awareness as well as Conversion campaign, are based on following framework (with rationales) as shown in the image.

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Paid Ad Execution plan:

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