DEF_Teaser_Final

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Music is Not Just an Art;
It’s a Social Phenomenon.
No one would disagree that music is a passion of people of every age, sex, race and
creed the world over. Of all the arts, it is arguably the one with the widest scope,
reaching as it does into the most remote regions of the globe. Perhaps this is why the
unique and vital essence of music is difficult to express. It is sufficient to say music is
not just about listening to, performing, or following a band or a musician - it invokes
passion powerful enough to lift its devotee to the heights of exaltation or, conversely,
plunge them to the depths of despair, even as it is able to demand personal sacrifices
which can verge on the fanatical. Music can also bring people together in cultural
identity and a sense of belonging.
“Music produces a kind of pleasure which human nature
cannot do without.” - Confucius, The Book of Rites
At DEF® (Dynamic Ear Function) audio laboratories, our creative team is exploring
a new dimension of this shared human experience, to deliver the purest form of
audio excellence to each individual listener. Positioned as we are at the forefront
of technology and creative design for a new generation of audio connoisseurs, we
recognize our mission: to provide a reasonably priced technology in our headphones
that delivers nothing short of perfection.
“Music is a moral law. It gives soul to the universe, wings to
the mind, flight to the imagination, and charm and gaiety to
life and to everything.” - Plato
Imagine a few of those rich audio experiences as delivered through DEF®’s superlative
product: the deep bass vibrating through your system as you listen to your favorite
song on your Droid or iPhone, or the excitement you feel immersed in your new video
game, complete with the thumping of footsteps, the creaking of doors and the ghastly
groans of goblins. Or perhaps it’s that pulsing beat that moves your body at a concert
or rave, or the stirring beauty of an orchestra that touches your soul. These are the
audio experiences with the rich and natural tones that every DEF® consumer will enjoy
when they embrace the audio excellence DEF® headphones deliver.
“Everyone deserves music” - Michael Franti
DEF® has set the bar in elevating audio sound waves to move mass with perfect
scientific certainty. We aren’t just a product or a brand, but a new way to live your
music and sound-filled lives. We like to think of ourselves as a human experience
brand with the desire to make life just a little better because of what we do.
“Music is the universal language of mankind” - Henry Wadsworth Longfellow
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SOCIAL IMPACT
“Apple suddenly has regained its cool” - Doug Morris - CEO Sony
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2 DEF® ’s Mission, Market Overview
and Competitive Landscape.
At DEF® we firmly believe we will dominate the global buds (in-ear) and cans
(over-the-ear) headphone market with our attention to detail, quality, consumer
communication and interaction, and integrity to build a brand more in tune with the
expectations of today’s savvy consumer. Industry insiders Keynote and Datamonitor
estimate the headphone market size to now exceed an astonishing 350 million
products shipped US $20 billion a year in global revenue – US $5 billion a year in
EMEA revenue- with growth estimates of c. 6% over the next two to three years (CAGR
5.5% 2017-2020).
“Music is a universal language that we all understand and that
holds a great deal of power.” - Global Citizen Awards
Our three foundation cornerstones of connectivity, humility, and integrity lead to
a meaningful social impact.
Electronics pioneer Steve Job dedicated his life to enhancing the personal human
experience, and we incorporate this into our own philosophy as we look to take
the electronic headphone market to an entirely new level. Beats by Dre set out to
transform the industry with marketing as the main focus of their brand building,
“product delivery by celebrity.” DEF® will go beyond only financial benchmarks with
the approach of a human experience brand that even icon Steve Jobs would be
proud of.
“Music can change the world because it can change people.” - Bono
Competitive Landscape and Evolution of the Market
DEF® is ready to launch following manufacturing testing, design, redesign and further
testing, having received ISO-certification and a recently filed US trademark presently
active, and concluding our market research.
Finally, affordable, professional-studio quality sound available to all, with the confident
clarity that we are not only the best in terms of product, integrity, quality, design, and
value, but that we have the humility to recognize the mistakes we have made and have
taken the time to correct them.
Headphones.com recently released a family of research documents that acknowledge
the evolving and polarizing marketplace to date, particularly noting that:
• While most electronics/technology markets receded during the global economic
crisis, the premium headphones market has shown “marked resilience” with a
growth of 6%
• Growth in the headphones market has been steady, generally at 10% to 15%
annually during the past decade CAGR 12% 2010-2017.
• While Beats’ technology holds a 64% market share, it has passed its plateau of
productivity. A technology reaches the “plateau of productivity” as its benefits
become widely demonstrated and accepted. Pricing and no “real” new technology
has led to its “tipping point,” with declining quality compounded by sustained and
sometimes increased pricing.
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3 DEF® Community:
Social Media & Outreach
To deliver what the consumer wants at a price that is affordable, you have to get out
on the “factory floor,” invest in your people and your product, and create a better
consumer experience. Creative companies recognize – and consumers remind us
-that there is always room for improvement. The sophisticated consumer recognizes
when quality of sound and the durability of cans decreases, but prices continue to rise.
One of our core differentiators is our niche sales connection platform. The world is
connected with a “click” in social media. With DEF®-connect Social media sales, our
brand will be the first consumer product-driven company to flip the switch on the
social media juggernaut around the world, and have a DEF® consumer-led sales team
built into every person connected to the net with one swipe or click of your finger.
“The true beauty of music is that it connects people. It carries a
message, and we, the musicians, are the messengers” - Roy Ayers
The DEF® Team Will Simply Carry on the Message
We have a proven track record in FCMG, especially in music, entertainment and
sports, so music delivery to consumers and the headphones market has always been
close to our heart; we don’t take shortcuts, and we don’t take our consumers for
granted.
In 2014, we began to study the headphones market in depth. Following this detailed
analysis, and after monitoring the market’s landscape and evolution we decided in
2015 to create and develop the next generation of headphone technology – “studio
quality at street prices.”
To better understand this decision, we will provide notable case studies in the
competitive landscape at a later stage, and how that landscape has evolved: quality vs.
“cool” vs. sustainability, and how we can take that one step further.
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DEF® Community:
Sales & Marketing
DEF® has researched and developed a ground-breaking sales vehicle unique to the
global media machine: DEF® Connect Social Sales Force, or DCSSF for short. It is
a community of like-minded individuals (young people who represent the largest
demographic using social media in the global platform) from such diverse groups as
skateboarders, video gamers, fashionistas, and music enthusiasts.
We will analyze these individuals’ use of social media globally – how often they post,
what their images, values, and public perceptions are, and how many followers are
linked to their Instagram, Snapchat, Twitter, and Facebook accounts. DCSSF will then
send a personalized DEF® “ambassador” gift box to these selected recipients.
These select people, our ambassadors, will receive a simple set of “loyalty sales
instructions” when they open their box, a perfect trigger to build our sales force!
Ambassadors will be rewarded as they encourage every follower on their feed to click
on DEF® and make an online purchase. This gives legions of pre-teens, teens, and
adults the opportunity to be a part of DEF®. When an ambassador receives that first
DEF® royalty check, they will spread the excitement by word of mouth.
Word of mouth is the most powerful sales model ever. Ambassadors’ followers will
become DEF® Juniors, social sales force participants, as well. After their royalties
exceed a set benchmark, they will be qualified as ambassadors to the brand and
receive their own personalized ambassador gift box – it is that simple. This social sales
model is never-ending and exponential as it drives sales by creating a special bond
between consumer and the DEF® brand.
While implementing traditional sales team members for “brick and mortal retail” and
the always successful “point and click” direct Internet sales model, this innovative
DCSSF combination will augment constant growth and aggressive market capture.
SOCIAL SALES FORCE
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4
Manufacturing, ISO,
Patent, and Capacity.
Twenty years of working with factories and suppliers in China has established
strong relationships. Before Beats was bought by Apple in 2016, its technology and
manufacturing were from China. Afterwards, this agreement ended. Now, drawing
upon our own strong connection with China, we have invested in a better technology,
especially in Bluetooth and wireless connectivity. DEF® is not exclusively based on
celebrity marketing, but on the highest quality standards of manufacturing.
We now have supply chain exclusivity with this outstanding supplier partner with
the capacity to manufacture six million sets of DEF® headphones/”cans” per annum.
Through their vast experience at all stages of production including the highest level of
componentry integrity, assembly and quality control, our supplier is more than able to
meet whatever demand we encounter from day one.
Our in-house teams’ values are the same as we continue to meet the demands of the
consumer in an ever-changing marketplace through our R&D prototyping capabilities.
DEF® is now registered and has a US trademark successfully in place which is now
active.
To summarize, DEF® has received a letter of intent guaranteeing an exclusive
manufacturing agreement as to the use of one of the world’s leading Taiwanese
manufacturers. Based on their newest US and global patented five channel inner
audio technology, this partnering will provide DEF® with an unparalleled level of
dynamic sound quality and wireless connectivity.
DEF® will be the only piece of audio excellence people will reach for to hear the
world sing. With great attention placed on integrity for each product we design
and produce, it is understood that we look to deliver an incredible quality product
to everyone for a sensible price. DEF® will change the face of the consumer audio
market with sound design, while snap and click technology will allow people to
personalize their DEF®s and establish a sense of community.
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5 Conclusion
DEF® headphones has been almost four years in the making and is now satisfied
that its products are ready to make a significant impact on the marketplace. We
have not taken shortcuts nor rushed the products to market, but ensured that all of
our team, our sales marketing message and manufacture of products are ready to
meet the demands the market and consumer require.
The time is NOW to launch in early 2018.
With market leader Beats having reached its plateau of productivity and declining,
and the remaining market being highly fragmented (other market operators with
less than 1% market share), as well as the segmentation into home and automotive
audio, DEF® is well-positioned to capture market share rapidly.
Our three founding pillars of connectivity, humility, and integrity will bring studio
sound to the street at affordable pricing.
The global market is expected to be over US$25bn in 2020. Even 1% of that
computes to over US$250m of revenue. While we are not aiming for the profit
margins of Beats, a healthy operating margin of 20% should give a better glimpse
of the potential value of DEF® headphones financially. We intend to be on the
ground with our community projects working alongside DEF® community leaders,
foundations and charities, to deliver on our social impact promise. Every Board
member and employee will spend at least two weeks per year in a DEF® supported
community project.
We all have the healthy need to listen to music and connect by...
a. Putting the Consumer first – no shortcuts;
b. Continuous improvement in expert team – leading in creativity
and technology
c. A fresh and candid approach - integrity
d. Defining ourselves and connecting – virtually and physically,
but always socially
e. Respecting and empowering each other through these connections with
kindness and care in the DEF® community - humility
f. With DEF® “community leaders” instilling ethics and values, and
supporting foundations and charities – giving back to society
...we will make a meaningful, positive social impact through music
and embracing our differences.
#DEFineyourself #Empowereachother
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COMING 2018
Tommy Puett
Chief Executive Officer
tommy@defheadphones.com
Dominic Barrett-Evans
Chief Financial Officer
dominicdefery@defheadphones.com