Small Organisation Developpment - Essay Example

MARKETING PLAN Small Organisation Development Table of Contents Table of Contents 1 Introduction 2 Marketing Plan of Down at Hele 2 External Environment 3 Competitive Market Analysis 4 Segmentation and Positioning Strategy of Down At Hele 5 Segmentation Strategy 5 Positioning Strategy 6 Marketing Mix and promotional Strategy 6 Promotion strategy 8 Sales Forecast 9 Conclusion 10 References 11 Introduction Contemporary marketing environments are highly dynamic and complex since marketing situations are largely influenced by technology, globalization and fierce competition in the market. Therefore, marketers are required to look at most effective strategies that can help them achieve competitive advantages as well as long term profitability. As Carpenter and Sanders (2009, p. 10) noted, marketers are always trying to sell their products or services to the targeted customers with a deliberate attempt to gain an advantage over other providers of the same products or services in the same market, and in order to achieve the marketing objectives, he is required to carry out effective planning and decision making. This piece of research paper presents a brief marketing plan for Down at Hele, a newly started innovative venture of micro distillery based on 200 acre farm in Mid-Devon. This plan details major aspects of marketing plan such as external environment, segmentation and positioning strategy, marketing mix, promotional strategy and sales forecast etc in relation to the marketing experiences of Down at Hele. Marketing Plan of Down at Hele Armstrong and Kotler (2005, p. 42) emphasized that a marketing plan, probably including its mission and vision, is one that identifies and defines the marketing activities of the business in terms of satisfying basic needs of its customers. Satisfying customers’ specific or general wants and needs is at the core of marketing and this itself is the basis of marketing objectives as well (Sheth and Sisodia, 2006, p. 21). Experts in the field of business found that a successful entrepreneur is one who brings a newer idea, finds opportunities to convert the same to a profitable venture, uses innovation and technology for producing something new and markets the same in a more attractive way (VanGundy, 2004, p. 3, Dana, 2006, p. 172). Treffinger, Isaksen and Stead-Dorval (2005) emphasized that creative thinking is also an important characteristics of an entrepreneur (p. 3) and thus he will be able to create a newer marketing opportunity. Acs and Audretsch (2010) argued that an entrepreneur is able to create a better marketing order (p. 227). When it comes to Down at Hele, company’s founder William Knapman’s outstanding entrepreneurial skills helped him uncover the hidden marketing opportunity surrounding hedgerow. He thought about restoring hedgerow for meeting the environmental management needs and for that purpose he tried to turn traditional farm buildings in to productive use. Though this can simply be considered as unexpected and incongruous happening of an idea, the same can further be developed and converted to a very long term profitable marketing opportunity if there is effective plan and appropriate foreseeing of what and how it should be marketed. External Environment Normally, a marketing plan comprises of basic three analysis; they are the internal environment, customer environment and the external environment. The external environment comprises of relevant external factors to a business such as competitive, economic, social, political or legal, technological and social related factors (Ferrell and Hartline, 2010, p. 43). The external environment of a business can be examined in different ways, but one of the major typology for that is analyzing the opportunities and threats in relation to various external factors as mentioned above. Lamb, Hair and McDaniel (2011, p. 39) addressed this as Environmental Scanning and they considered it to be essentially important element in preparing an effective marketing plan. As far as technological, social and ecological factors are concerned, Down at Hele seems to have many favourable developments since the idea the company puts forward will certainly attract a general appeal from people who give much concern on green environment. Down at Hele is not going to simply exploit the natural resources of hedgerow or farm products, but rather, it can help contribute to green marketing as well as pollution-free concepts of business and thus it can contribute to better brand equity as well. Economic recession, financial troubles due to fluctuations in financial factors etc may seem to be threats in its marketing scenario, but they are quite same for all the firms and industries in the country. As the company needs to depend on a bonded warehouse, it has to get allied with government and this seems to be an obstacle. The company may face difficulties in raising funds from the Coalition government for replanting of the hedgerow. Competitive Market Analysis In developing a marketing plan, the firm primarily requires to predict the extent and nature of its competitive rivalry and to identify how strong and powerful the competitors in the industry ((Ireland, Hoskisson and Hitt, 2007, P. 162). Competitor analysis is not only a component in marketing plan, but also an important strategic tool since knowing values and propositions offered by the competitors will help the company design and develop the market accordingly (Bangs, 2002, p. 61). The company has to face severe competition from three competitive groups, namely multi-nationals such as Diageo, Pernod, start-up and specialists businesses such as Chase and Bramley and the ‘made at home market’. As the company is a new entrant to the industry, one of the major barriers is capital requirement for purchasing the premises. As there is much competition in the industry, Down at Hele has to foster on innovation with a view to bring differentiated products in the market. Since some of the brands existing in beverage market have already well positioned in customers’ mind, Down at Hele has to use extensive promotional strategies part from utilizing the word-of-mouth opportunities. Segmentation and Positioning Strategy of Down At Hele Segmentation Strategy Segmentation, targeting and Positioning (STP strategy) are critically important elements to effective marketing that are to be evaluated for conducting the marketing plan. All the marketers segment their markets, classifying the total market it targets in to distinct sub groups (Lancaster and Reynolds, 2001, p. 68). Some of the major sub-groups in segmentation are geographical (population density, region etc), demographic (personality, lifestyle etc), behavioural (volume, location, brand loyalty etc), and psychographic (Stone and Desmond, 2007, p. 175). Restaurants, lodges, resorts and other sorts of hospitality firms will account for a good portion of the market of Down at Hele. The total market of Down at Hele can be segmented in to three, that are 1) hospitality firms, 2) middle class rural customers and 3) large scale retailers such as Marks and Spencer, Tesco, Waitrose, Selfridges etc. Segmenting the market in to sub-groups cannot merely help the marketing become successful, but customers and their specific requirements are to be identified and the marketer should ensure that customers he targeted are satisfied as well. Positioning Strategy Down at Hele will be an amazing brand experience among its customers since greater emphasis will be given to position the brand as a unique in the distillery market. It is not just an alternative to freshening, but rather, a quality drink with a natural zeal that itself would help attract greater numbers of customers towards the brand. Positioning strategy evolves when there are several well-defined competitors and they are with fairly unambiguous images (Stevens and Loudon, 2005, p. 155), but the positioning strategy of Down at Hele is that its brand must be highly impressive as a unique distillery to the customers. Market positioning always helps a firm communicate its unique points of difference in relation to its products or services to the targeted customers in a more clear way that customers can easily grasp the idea behind it (Kerin, Hartley and Berkowitz, 2005, p. 64). Down at Hele will prepare its positioning strategy by identifying a set of possible competitive advantage, choosing the right competitive advantage and selecting an overall positioning strategy. Armstrong and Kotler (2005, p. 208-209) identified these three elements as the major steps involved in planning the positioning strategy of a firm Marketing Mix and promotional Strategy Down at Hele plans to have an integrated approach to its marketing mix elements that are product, price, place and promotion. An integrated approach to managing marketing mix elements can be considered as an important strategy to marketing. As Wilson and Gilligan (2005, p. 536) pointed out, marketing mix elements are to be well managed and effectively integrated so as to achieve a higher level of marketing synergy. The marketing mix elements and the way they are integrated in Down at Hele can be recognized from the above depiction. The core products, that are actually meant for meeting customers’ specific needs (Rowley, 2006, p. 61) are distilled spirits including ‘signature spirit’, sole gin plus cocktail and vodka, apple brandy, cherry brandy etc. The core products are the fundamental benefits sought by the customers (Longenecker, Petty and Palich 2009, p. 176) and therefore distilleries offered by Down at Hele will also be meant for meeting the quality requirements the customers expect. The company will use extensive production techniques and innovation with a view to bring differentiated products in the market. The butterfly conversation will be an integral feature of promoting the brand Down at Hele and that will serve as an important influence in the development of brand portfolio. The price of distillery products such as sole gin plus cocktail and vodka, apple brandy, cherry brandy will be moderately priced. Rather than going for margin-plus pricing or any other pricing strategy, the company will depend on cost-based pricing and this in turn will help the company fix relatively a less price compared to those prevailing in the market. For instance, the prevailing price level of sloe gins is between £25 to £35 for one bottle, but cocktail price is between £35 to £50. It may not always be possible to sell directly to the ultimate customers for most of the distillery marketers since customers are mostly scattered in rural and other areas. Down at Hele will be depending on third part retailers and other sales force. Main retailers are Large scale supermarkets such as Waitrose, Marks and Spencer, Sainsbury etc and hospitality firms such as hotels and restaurants. Down at Hele will focus on affinity marketing which is a strategy that focuses on finding customers interested in certain products or services and then offering that customers related information or products from various sellers. Affinity marketing is a powerful tool that can be used for reaching prospective customers very quickly and cheaply (Negen and Negen, 2010). Promotion strategy Integrated Marketing Communication has in recent years become a significant promotional strategy by which various promotion tools such as advertising, sales promotion, public relation, event marketing, words-of-mouth etc are integrated and aligned together to achieve greater advantages in competition (Belch and Belch, 2007, p. 11). Down at Hele will integrate marketing communication with a view to ensure consistency in the messages it communicates with its customers and the consistency in message will certainly add to improve the benefits that it expects from the word-of-mouth. Sales Forecast A sales forecast is an estimate of the total amounts of the products or services that marketer expects to sell during a specific period based on specific level of marketing efforts (Pride, Hughes and Kapoor, 2012, p. 317). By measuring the sales potential and forecasting the total sales of the next three years, Down at Hele will be able to take important decisions related to entering new markets, efficient allocation of resources and comparison of various market segments etc. The sales forecast of the next three years is detailed below: From the figures above, Down at Hele will be able to produce more in coming years and its future sales will higher from year on year. In order to maintain an increasing trends in both production as well as sales, the company will be extremely caring about the marketing strategies and the management will be concerned about market forces such as economic, social and political factors. Perceptual Mapping of Down at Hele Conclusion An idea can make tremendous changes in the existing market scenarios. This is what exactly happened in the case of William Knapman, an entrepreneur who discovered a business opportunity for dynamic distillery products from the farm he purchased. This piece of research paper has presented a brief marketing plan for his company, named Down at Hele, comprising of major components such as marketing mix, external analysis, promotion strategy, segmentation and positioning strategy. Down at Hele’s segmentation strategy is purely based on the segmentation marketing concept. Its brand will be positioned as a unique brand in the distillery industry for quality items. Both the segmentation and positioning help the company identify the customers, recognize their tastes and design the products accordingly. It focuses on an integrated approach to the marketing mix and its promotional strategy will be integrated marketing communication that it can maintain consistency in messages it conveys to the customers. 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