Planning as an Extremely Important Element to Successfully Performing - Essay Example

? MARKETING PLAN :Abdulhakeem Alfaleh Foundation of Marketing theory Executive Summary The organizations that produce and market products and services are performing their basic functions primarily to satisfy their commitments to the society, the customers and other relevant stakeholders. From an economic-point of view, they create a benefit, called utility such as form, time, place and ownership utilities (Boone and Kurtz, 2009, p. 5) and they are the want-satisfying power of the goods or service. But in today’s highly complex marketing contexts, no business would be able to survive unless it plans effectively for the future. The contemporary marketing is largely influenced by technology, competition, globalization and customers’ ever-changing specific requirements. Therefore, a marketer has to foresee how these significant variables can impact its marketing domain and how they can effectively be managed in order its marketing activities to be successful and to help it create long-term sustainable competitive advantage. This paper presents a marketing plan for ‘Green Pizza Restaurant’ in Riyadh, Saudi Arabia, comprising of major marketing and situational analysis and relevant description of marketing objectives and marketing strategies. This paper uses SWOT analysis and PEST for analyzing both internal and external environmental factors to the business. With relation to marketing objective, segmentation, target market and positioning strategy (STP) and marketing mix strategy including its sub-elements of product, price, promotion and place are detailed in this paper. TABLE OF CONTENTS EXECUTIVE SUMMARY………………………………………….. 2 INTRODUCTION ………………………………………………… 5 SITUATION ANALYSIS (Internal to the company) ………………… 5 Company’s mission, objectives and growth strategies ……….. 5 Marketing Mix elements ……………………………………… 6 The customer Analysis …………………………………………. 7 Unique Value Proposition ……………………………………… 8 External Analysis ………………………………………………………. 9 The Market Extent …………………………………………….. 9 Competitor Analysis ………………………………………….. 9 The Economic Environment ………………………………….. 11 Technology Environment …………………………………….. 11 Social and cultural environment …………………………….. 11 SWOT Analysis ………………………………………………………. 12 Marketing Objectives…………………………………………. 13 DEVELOPING MARKETING STRATEGIES ……………………… 14 Pizza Products and its use ……………………………………… 14 Segmentation Strategy ………………………………………… 14 Targeting Strategy ……………………………………………. 15 Positioning Strategy ………………………………………….. 16 Product Strategies …………………………………………… 16 Pricing Strategy …………………………………………….. 18 Promotional Strategies……………………………………… 19 Supply Chain Strategies …………………………………… 20 IMPLEMENTING AND CONTROLLING THE MARKETING PLAN… 20 Action plan ………………………………………………….. 20 Responsibility……………………………………………….. 21 Budget ………………………………………………………. 21 Time Line ……………………………………………………. 21 Evaluation and measuring the performance………………….. 22 CONCLUSION…………………………………………………….. 22 REFERENCES …………………………………………………… 23 Introduction Planning is an extremely important and critical element to successfully performing a marketing or any other business activity. Marketers are attempting to sell their products and services to its potential customers and therefore a strategic planning for the marketing is virtually an attempt to gain an advantage over other providers of the similar products or services in the same market (Carpenter and Sanders, 2009, p. 10). Effective planning and decision making processes are thus closely related to achieving marketing objectives, gaining competitive advantage and ensuring satisfactory revenues. Green Pizza is going to be an amazing experience to its customers around Riyadh, Saudi Arabia, providing multi-cultural organic food and drinks in joyful environment. In order to meet its very specific objectives, Pizza Restaurant has to put sincere efforts to create values, communicate them to its potential customers and deliver them to its valued customer (Kerin et al, 2005). Pizza Restaurant requires to consider maintaining better relationship with customers (Armstrong and Kotler, 2005, p.6) and converting them to be loyal to ensure long-term profitability as its core marketing values and propositions as part of its marketing plan. Situation Analysis- Internal Environment Mission, objectives and growth strategies As Armstrong and Kotler (2005, p. 42) found, a marketing plan, especially its mission statement is one that defines the marketing activities of a business in terms of satisfying basic needs of its customers. Pizza Restaurant’s mission is that it proposes to offer quality foods and drinks to its customers to help them get their needs satisfied with healthier food in joyful restaurant-environment. Pizza restaurant’s mission will be to fulfill the personal goal of providing the targeted customers with unique dining experience, not only as an alternative place to eat but also as an entertainment environment where customers will be able to enjoy and meet their varying needs of hunger, thrust, joy and leisure entertainment. The restaurant will give greater emphasis on creating better atmosphere and legendary hospitality. Establishing customer focus strategy, converting the existing customers to be loyal, maintaining long-term profitability and thus ensuring strong competitive advantages are some of its major objectives. Mass-marketing strategy, customer focus strategy and customer relationship strategy will be its future strategy-targets in order to enhance on going growth of the firm. Finding hidden market segments and seizing the opportunities from such markets will be one of the very significant growth strategy for its future. When it comes to a restaurant or any hospitality firm, quality services can add more significant values to both the firm and its customers. Marketing Mix elements Green Pizza Restaurant plans to take an integrated approach to its marketing mix elements, namely product, place, price and promotion. It’s because, Wilson and Gilligan (2005, p. 536) stressed that marketing mix elements are to be well managed and effectively integrated so that a highest marketing synergy can be achieved. The products and services that Pizza restaurant plans to deliver to its customers comprise of pizza food items, pizza drinks, other relevant and organic foods and drinks, catering, dining and restaurant services, customer relationship services etc. While services are freely provided, almost all of its food and drinks are moderately priced, with an emphasis on penetration pricing policy as they will be relatively cheaper in the beginning to attract larger numbers of customers and the price will be slightly increased to cover its costs. Season-based sales promotions will be announced to its customers, and the restaurant will be therefore able to facilitate seasoned-foods to be given parcels or in-restaurant services too. Some of the nearby small retailers will be used for the smooth delivery of pizza products apart from its in-restaurant distributions. Customer Analysis McLoughlin and Aaker (2010, p. 26) argued that analyzing customers in relation to who are they and whom to serve or which segments among them to be differently targeted are critical elements to a successful market plan. In analyzing customers of a firm, it is very important to analyze the segments and then to recognize the strengths of each of the segment and their specific requirements (Luther, 2011, p. 55). Customers of Pizza Restaurant are more likely to be from rich people and middle class people who like organic ingredients for their food and drinks and mainly pizza-contained essences that they can fulfill their varying needs. The restaurant has targeted all different kinds of people, relying on their personally interested menu. The restaurant will also be able to attract healthy food fans because fat-free pizza will only be issued in the restaurant. For pizza restaurant, the whole targeted market will be segmented in to different categories and most of these segments are served when they visit the restaurant. The segmentation strategy that the restaurant proposes to implement will be mass-marketing strategy. In order to improve the standard of marketing activities and overall business performance especially in relation to maintaining good relation with customers, the restaurant has put efforts to conduct continuous assessment, analysis and extensive research on customers preferences and their varying requirements so as to design and develop newer ranges of food or drinks or change in the existing lines of goods or services it delivers to the customers. The Unique Value Proposition A firm must be able to consider customers’ perception about quality, value, utility, usability and features of goods or services because their purchasing decision will be most likely to be influenced by these variables (Duchessi, 2002, p. 81). Why customers prefer one brand to the other? It is because of the value proposition. Customers perceive more values, or higher quality or greater usability for the one they preferred to the other they didn’t prefer. Green Pizza Restaurant has given greater emphasis to improve overall standards of its goods and services, mainly by analyzing the value propositions and thus to improve the quality and other relevant features of foods and drinks. External Analysis Market Analysis Green pizza restaurant has been focusing local-customers from around Riyadh and those who come to Saudi Arabia for visit. The restaurant has been seizing opportunities by marketing pizza-related foods and drinks to different segments of people including rich hippies, upper middle class and lower middle class people as well as college and school students who like to find their short eats for lunch and breakfast. Competitor Analysis As Ireland, Hoskisson and Hitt (2007, p. 162) stressed, competitor analysis is one of the foremost important steps that a firm has to take in order to predict the extent and nature of the competitive rivalry, to measure how strong they are in the market, to identify what specific strategies they take and to find out what strategies can be taken to defeat them or to survive their competition. Studying the plans of competitors, analyzing their strategies and evaluating how their customers respond to them are of greater significance in competitor analysis (Bangs 2002, p. 61) suggested, studying competitors’ plan, strategies and customer attitudes to them will be of greater help to a company (p. 61). There are four large restaurants currently competing with Green Pizza. They are Eat-Fresh, Zigzag, Al-raid and Hill-view. All these restaurants together attract more than 500 people a day. Green Pizza restaurant was able to attract more than 220 people a day mainly because of that it was able to facilitate many amenities for the customers including car parking, internet cafe etc. In the chart below there is information on competitors and weakness point compared to Green Pizza restaurant. Eat-Fresh Zigzag Al-raid Hill-View Green Pizza Target high income people Target only youth Target low wages only Target high income people Target all kind of people Their menu include other food beside Pizza Specialized in Pizza, without paying attention to healthy food All kind of fast food, and Pizza Pizza and other food Specialized in Pizza, fat free Pizza. Customer rate around 165 a day Customer rate around 160 a day Customer rate around 150 a day Customer rate around 150 a day Customer rate around 170 a day to 180 Strengths points the customer rang stable Strengths points Very popular for youth Strengths points Low income keep coming back Strengths points Very old in the market build reputation Strengths points Large base of customers, from every kind of people Weakness Focus on specific people Weakness Only pizza served so if someone want to have something else, there will be no chance Weakness Focus on specific category Weakness Focus on specific category Weakness Only Pizza served so if someone want to have something else, there will be no chance No delivery service No healthy food served No delivery service No delivery service Complexity in menu and other preparatory activities The Economic Environment The Saudi Economy has for decades been growing due to its greater amounts of oil resources and growing business opportunities. An economy is more likely to grow when its businesses grow or have already grown. Saudi has become the most powerful and largest petroleum exporter that in turn has increased the in-flow of foreign currency and improved standard of living in the country (Jodie, 2007). From 1953 onwards, Saudi has improved its overall exports of petroleum products to become the world’s largest country in [etroleum exporting. Financing availability, financing explosion, economic policies within the country, economic crisis from other countries are some other factors that influence the business and economic environment of pizza restaurant both positively and negatively. Technology Environment Though technology has relatively less roles in hospitality industry, especially to a restaurant, it is also able to make use of some of the recent technologies like induction cooker, electronic oven and electronic timing system etc. Any such technology can add greater values to the company as well as to the customers. Green Pizza restaurant has facilitated computer billing, computer networking and other relevant communication system so that its employees are able to perform office works including billing and other tasks very easily. All these in turn help improve the accuracy and speed of operation too. The chefs and other workers have access to networking through WIFI to help them retrieve necessary information regarding different food items, ingredients to some organic food items and feedback from customers etc. A firm will be able to get rid of socio-economic and political backwardness only by adapting and adjusting with newer and latest technologies (Joseph, 2005). Social and Cultural Environment The youths and college and school children are very much fond of organic food, including pizza and ice creams whereas old aged are most likely to depend on traditional food items. As old aged people are only around 1.8% of the total population, this won’t be a major problem to be concerned about. Most of the Saudi communities have already welcomed different kinds of multi-cultural, organic and other foods items mainly in joyful environment. SWOT Analysis Strengths Weaknesses Greater emphasis on value creation and customer satisfaction Integrated approach to marketing-mix elements Customers’ strong desire for organic pizza foods Strong desire to deliver value to customers based on value propositions. Complexity in menu and other preparatory activities Restaurant provides only pizza-products, so customer who desire to get others organic foods along with pizza foods may not satisfied. A good portion of the people still don’t like pizza-items Opportunities Threats Advantages of local market Growing trends of customers towards joy and entertainment Differentiated pizza-foods by considering different tastes and preferences of customers Convenience with newer technologies like electronic oven High competition from four restaurants Readily available food in other shops near to the restaurants . Marketing Objectives The main marketing objectives of Green Pizza Restaurant are to continually provide quality pizza-contained food and drinks with supreme quality services to its customers. To meet this specific objective, the restaurant will:- Evaluate the value propositions of the targeted customers, Ensure supreme quality for its goods and services, Analyze the level of satisfaction of the customers and gather the feedback to find out how effective are the goods and services Expand the business and overall marketing activities to newer customers, Launch few branches at various places in Riyadh to reach wide markets, Find out and implement very effective marketing strategies that can help the company stay long in the market with strong competitive power, and Ensure long term profitability and sustainable competitive advantages. Developing Marketing Strategies Pizza Products and its use Our customers are more likely to visit the Restaurant and they will be provided in-restaurant services. A menu given to them will be an ideal way to help them find out what specific food or drink item to be ordered and they will get their items ready within shorter time. More than 90% of Pizza restaurant customers are those who come to the restaurant to meet their personal need of hunger, thirst and enjoyment. Most of them visit restaurant for a time-pass. Remaining customers order parcels from the restaurant itself or from the nearby small-food retailers. The customers are provided sufficient space and seating arrangements in restaurant to help them take their own time to order food items, get them ready and have it on their convenience. Goods are provided in small packages. Restaurant has made necessary arrangements to dispose food waste and packages without making any environmental issues of pollution. Segmentation Strategy All companies segment its markets by breaking down the total market of a product or service in to distinct sub-groups (Lancaster and Reynolds, 2001, p. 68) including geographical (region, population density etc), demographic (age, sex, marital status etc), psychographic (Life style, personality etc) and behavioral (rate, volume and occasion etc) (Stone and Desmond, 2007, p. 175). Green Pizza Restaurant has segmented its total markets to sub-segments. Its market comprises of different groups of people from around Riyadh and from those who visit Riyadh as tourists. The whole market is segmented to young, college students, school children, women between 20 to 40 and 30-above savvy business people. The specific requirements of all these groups will be extensively studied and these groups will be studied in relation to their life-style, education and family background in order to ensure greater efficiency in delivering quality goods and services to them. Targeting Strategy Lamb, Hair and McDaniel (2008, p. 220) opinioned that a marketer would target a group of people or organizations by designing, implementing and maintaining a specific marketing mix so that the company will be able to meet the needs of that specific group. Pizza restaurant has to study the attributes and expectations of each of the group or segment and they are to be targeted with any effective strategy that can attract them more and retain them for long time to ensure long term profitability. When a specific group among various segments is targeted, for instance, school children or college students, various marketing mix elements such as product, price and place are to be integrated and developed in a way that their needs are satisfied, behavior is considered and their specific requirements are met. As Ferrel and Hartline (2008, p. 178) found, a firm is more likely to adopt any or more of different targeting strategies from a) single segment strategy, b) selective targeting, c) mass marketing strategy, d) product specialization and e) market specialization. Green pizza restaurant has selected mass marketing strategy because it will be considering all various segments and groups among its customers and all these groups will be targeted with any such strategy that can attract them more and help them become loyal customers. Positioning Strategy One of the most important marketing objectives is that the brand being communicated must be able to be positioned in customers’ mind and also be able to retain customers to create brand loyalty. For the better brand positioning, Green Pizza Restaurant will depend on effective way of communication, often to use integrated marketing communication so that the brand ‘Green Pizza’ will be effectively branded among its customers. A brand or a company can be better positioned only when its customers associate the brand or company name to certain attributes and expectations like quality, feature, usability and utility. Green Pizza restaurant will be able to use effective advertising including both print media and broadcast media in order to reach its brand messages to its potential customers. Product Strategies The core product is one that actually meets the needs of customers (Rowley, 2006, p. 61). The core product or core service is the fundamental benefit or solution sought by customers (Longenecker, Petty and Palich 2009, p. 176). For Green Pizza Restaurant, customers seek benefits and solutions to meet their huger, thirst and leisure and these will be the core products. According to marketing perspectives, actual product is what is actually delivered to the customers (Rowley, 2006, p. 61) and is the basic physical product or service that provide the benefits and solutions that customers seek (Longenecker, Petty and Palich, 2009 p. 176). Pizza contained foods and drinks, dinner, ice creams, hot drinks and all other services that restaurant provides to customers while they visit are the actual products and services. Augmented product refers to all other features and specifications that constitute part of the product and add values to the exchange (Rowley, 2006, p. 61). According to Longenecker, Petty and Palich (2009 p. 176), augmented product or service is the basic product plus any extra or unsolicited benefits to the consumer that in turn prompt their purchase. When it comes to Pizza products, they will be fat-free, organic and specially prepared by considering genuine Halal ingredients and all these will prompt customers purchase. Integrated product mix strategy will be used by Pizza Restaurant because it will prompt marketing management to consider all different marketing mix elements for different segments of customers and adjust each of them accordingly. For instance, to attract a very specific group from among its total markets, the restaurant may have to extensively use promotion and discount or less-pricing whereas there can be another segment which is least bothered about price or promotion, but rather quality and better services would attract them. Packaging will be carried out by Restaurant’s special staffs who are experts in scientific packing. As its products are mainly foods, drinks, sweet-contained cakes etc, it is extremely important that the packaging must be carried out by considering hygienic preservation and with mush safety consideration because they are to be kept safe from insects. Apart from these, the restaurant will take care of preparing its packaging in most attractive and colorful way to attract greater numbers of customers. More than 90% of our customers are those who directly visit the restaurant to meet their hunger and thirst. It is therefore highly important that restaurant has to take much efforts to increase its service quality. A quality department, comprising marketing management and customer relationship manager, will enhance service quality by identifying which areas to be improved, how to provide supreme quality services and how are customers satisfied with the existing services. Pricing Strategy Basically, all the pizza foods and drinks will be moderately priced so that customers never feel they are over-charged as compared to other hotels and restaurants. In pricing the food and drinks, the marketing department will consider marginal-plus pricing. By calculating and estimating the total costs and revenues for specific numbers of products, a reasonable amount or percentage of profit will be added to it. Restaurant is already facing competition from four other market players and therefore it will use penetration pricing policy to attract larger numbers of customers in the beginning and once they all become happy with its foods and drinks, it will be wise to increase the price slightly in order to make a reasonable amount of profit. As Baker (2010, p. 66) found, penetration pricing is when the firm decides to fix a price below the product or service value to the customer, thereby to ensure larger customer base. The firm can increase the price slightly if determines so to enhance profitability. Promotional Strategies Designing, developing and delivering a consistent message in communicating the brand with customers are highly critical to marketing success. The green pizza restaurant proposes to use a constant message to customers- ‘Enjoy your seasons…Be green with Green-pizza’. The restaurant will communicate this message throughout its packages, advertising and all other formal communications. The restaurant also plans to create stronger buzz related to ‘green-pizza’ which will module a thought in customers mind that the restaurant gives more emphasis on creating natural and greenery environment and customers therefore will have joyful time with pizza-products. In recent marketing landscape that made success stories, integrated marketing communication can be found to have significant roles. All different promotion mix elements like print media advertising, broad cast media advertising, sales promotion, e-marketing, public relation will be integrated and coordinated to ensure maximum returns on the investments. As Belch and Belch (2007, p. 11) noted, integrated marketing communication is a strategic business process to be used to plan, design and develop coordinated and effective brand communication program with all the stakeholders. Though the restaurant will have to use third party small retailers, their role will be relatively less in marketing and distribution. In order to maintain consistency in the brand communication program, the third party sellers will be provided flexible advertising tags that can be used in stores to help the customers. they will be frequently advised about the foods and drinks given to them for the distribution. Supply Chain Strategies As it is a restaurant and most of its customers are those who directly visit the restaurant to meet their hunger and thirst needs, there is no need for an extensive supply chain program as if often required for a large manufacturing firm. But still, the restaurant will have to facilitate all the sufficient and necessary arrangements in-restaurant to ensure that foods and drinks are delivered to the customers who visit the restaurant. The restaurant plans to use small-scale retailers around Riyadh, who have easy access to large numbers of customers. The pizza foods and drinks that are already packaged will be transported in cold-storage facility so that spoilage of foods can be avoided up to a greater extent. Both the in-restaurant distribution and third party distributions can be used to maximize the value the restaurant offers by ensuring quality of goods and services, on-time customer services, spot-answering to customers questions and maintaining consistency in brand messages to be communicated. IMPLEMENTING AND CONTROLLING THE MARKETING PLAN Action plan The marketing plan of Green Pizza Restaurant has comprised of quite a few numbers of marketing strategies. They are, segmentation strategy, targeting strategy, positioning strategy, mass marketing strategy, penetration pricing strategy etc. The following are the major steps to be taken in implementing and controlling all these strategies:- Find relevant resources to be used for implementing the strategy, Ensure involvement of people, process and technology, and Evaluate the strategy to be implemented, and ensure smooth functioning of the strategy. Responsibility Marketing management will be the main authority being responsible for the implementation of all the strategies. For the brand positioning and pricing strategies, the management may have to use other measures and may be more people to get things done with others. Who ever joins in the implementation of the strategy will be responsible for the execution. Budget Implementing each of the strategies will be relatively costly and the marketing management has to predict the total expenditures to be incurred with the help of financial management and fix a fund for its budgeting. Pizza Restaurant estimates that implementation of penetration pricing, positioning and Integrated marketing communication together will cost more than 5,400 SR. Time Line The segmentation, targeting and positioning strategy are expected to be implemented within the first six months, hopefully before October 2011, and mass-marketing strategy to be completed before December 2011. Integrated marketing communication may be implemented over times according to its need and specific requirement. The penetration pricing will be taken only for the first five months, so that to complete before October 2011. Evaluation and measuring the performance Once the marketing plan has been prepared and its execution has been completed, it is very important that the marketing management is responsible to evaluate the performance of the project. They are expected to measure how efficiently each strategy has been implemented, what are the direct and non-direct results of it and what have they actually contributed to the business. They are also expected to find any variances from the standards that were set in the planning stage and find solutions to overcome such issues or defaults. Controlling stage is the final stage that completes the planning because what standards were established in the beginning stage can be evaluated and controlled with possible solutions to overcome the issues. Conclusion This piece of research paper has presented a brief marketing plan for Green Pizza Restaurant, which is located in Riyadh, Saudi Arabia. The situation analysis part has dealt with analyzing the present situations of the firm, both internally and externally. The SWOT analysis given in the situation analysis part is meant to provide both internal and external strengths, weaknesses, opportunities and threats of the firm. Developing marketing strategies to be implemented for the marketing success has been one of the main areas this paper highlighted. Different marketing strategies are presented in this part, based on marketing theories and perspectives. Product strategy, price strategy, promotion strategy and supply chain strategy are the major areas being discussed in this part of the paper. References Armstrong, G & Kotler, P 2005, Marketing: An introduction, Prentice Hall, Pearson Education Inc Baker, RJ 2010, Implementing Value Pricing: A Radical Business Model for Professional Firms, Illustrated edition, John Wiley and Sons Bangs, D. 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