Marketing Mix and Marketing Strategies Pursued by St Joseph - Essay Example

? Executive Summary Education is regarded as one of the most important aspects and is considered vital for the success of nations. Every nation, may it be developing or developed, gives special importance to education. Keeping in view today’s need of higher education, this paper probes into the development of marketing plan of St. Joseph primary school. Introducing a service that has international presence enables businesses to withstand the changes in the market where the service is being introduced. This paper probes into the external and internal assessment of the company and the environmental factors for analyzing the suitability of the market for expansion. In addition to that, it also sheds light on marketing mix and marketing strategies pursued by St. Joseph for achieving their intended goals and objectives. Plus, this paper also gives an overview of measuring the performance against standard performance and financial considerations that are necessary to be considered by the financial experts while making decisions regarding expansion of the school in Ecuador. Introduction World has changed its course and education is now given huge importance in almost every part of the world. In today’s era, economies all over the world are confronted with different issues that are economic, political and social in nature. However, in addition to these, education from the past few years has been given tremendous importance and is considered as a mile stone for the nations to achieve their objectives and economic well-being. A society without educated people cannot run smoothly. A political setup cannot be effective until and unless people employed are educated to the highest degree of their potential. Similarly, a country cannot achieve its economic growth and development until and unless the youth of that particular country is educated and contributes something to its country’s economy. Therefore, keeping in view all these aspects, what is desirable is the trend of higher and quality education which should be provided to each and every individual of the society, community and a country. Developed nations like those of Canada, United States and United Kingdom have touched the skies by inculcating quality education into their youth. They attained this objective by building schools, colleges and universities that were aimed at providing quality education. It is evident from the history that those nations who have considered education as an integral part of their success have always been at the top and remained distinctive among other nations who have not given huge attention to their education policy. Keeping in view the usefulness of education and its effects on economic well-being, this international marketing plan will put forth an idea of introducing a primary school in South America Ecuador. The marketing plan will actually incorporate the expansion of one of the schools of UK into South America Ecuador. However, for the purpose of this marketing plan the primary school that is selected for South America Ecuador is St. Joseph primary school. This paper will probe into all the aspects of introducing this school in Ecuador, accompanied with its financial considerations and marketing strategies required for introducing a school. Reason for choosing market and service As discussed above that education plays a vital role in the success of every nation, so keeping this in view and literacy rate of Ecuador, primary school service has been introduced. The literacy rate of Ecuador according to the report of US Department of State (web 2) is 97.3%. Such a high literacy rate signals that Ecuadorians are fond of education and they have huge inclination towards acquiring education, keeping in view their need and enthusiasm towards education, primary school service idea has been proposed. The primary school introduced will actually be an expansion of the existing school of UK named St. Joseph primary school. The reason behind the selection of the Ecuador as a market for a product launch is that Ecuadorians are fond of education and opening a school over there will definitely yield huge profits. Moreover the population of Ecuador is 14, 573, 101 which is not that much as compared to other areas of south America like Brazil. Thus, having a literacy rate of 97.3% within this much of population means that every individual is acquiring education, so introducing a school in such statistics will be beneficial and profitable. Moreover, education is compulsory for every individual in Ecuador from the age of 5-18 years. This means that everyone has to attend primary school and acquire basic education which will definitely add a lot to the school’s overall profitability. History of Ecuador According to (web 1), a Spanish conqueror conquered the land in 1532 and they thrived by exploiting Indians. However, the tribes living in highlands of Ecuador formed their capital Quito. However, the first revolt against Spain occurred in 1809 and followed by revolt, Ecuador joined Venezuela, Colombia and panama in a confederation known as Great Colombia. Ecuador went through huge number of revolts followed by dictatorship after the Great Colombia collapsed in 1830 because after its distortion, Ecuador became independent. Various changes occurred during the Radical Liberal Rule and the most prominent of all the changes that took place was the disestablishment of church followed by introduction of freedom of religion, press and speech. In 1941 Peru invaded Ecuador and captured huge area of its territory and the war again broke out in 1995. Later on, both the countries signed a treaty in order to resolve the 60-year border dispute. Situation analysis: While doing situation analysis, an external and internal audit will be carried out. External audit will shed light on the factors prevailing in external environment. These factors are political, legal, social, economic, demographic and technological in nature. However, an internal assessment will shed light on organization’s internal strength and weaknesses and external threats and opportunities. However, external audit will be done by means of PEST analysis whereas internal assessment will be carried out by means of SWOT analysis. PEST analysis: According to Bensoussan and Fleisher (2008) pest analysis incorporates those factors that are beyond the control of any organization. The information gathered from the analysis usually end up into something that contributes very little to the marketing strategy analysis. PEST analysis is basically the analysis of political, economic, social and technological factors. Political factors: Ecuador during year 1996-2006 went through high political instability. Various presidents kept on introducing different policies that were into their best interest and this lead towards political disruption. However, with the arrival of Noboa dollarization in the economy, and the construction of second largest oil pipeline took place. He worked selflessly towards the well-being of the country. However, during the period 2007 to present, Ecuador went politically stable as the new president introduced many developmental plans among which spending on houses, healthcare and other social programs increased a lot. Terrorism is also one of the factors that have caused severe political instability. Launching a product or a service in such an environment can cause severe problems if the product has no international presence. Political instability often results in economic instability also. Organizations who tend to position and market their products and services should take into account the political implications as well. If the product or service has international presence in some other market, it can buffer the effects of instability on the product or service being launched. Economic factors: According to the report of US Department of State Ecuadorian, economy is driven largely by petroleum products, manufacturing sector that manufactures exclusively for domestic market and agricultural products that are not only for domestic use but for export purposes as well. It is the largest exporter of bananas (earnings of 2$ billion), shrimps (654$ million) and canned fish (632$ million). It is rich in natural resources, particularly in petroleum and minerals with its minerals market developing slowly. About 50-60% of its export earnings depends upon petroleum products and constitutes 25-30% of GDP 30-40% of government revenues. This shows that the country is stable economically to a greater extent. However, while introducing any product or service organizations need to look at the broader aspect and should take into account the global picture of the issue. We all know that the world’s economy is largely suffering from energy crisis with petroleum prices touching the sky. Similarly, recession have severely affected most of the economies that resulted from financial crisis occurred as a result of bursting of housing bubble in US. Keeping in view these aspects, St. Joseph primary school has to introduce such marketing strategies that not depend heavily on economic factors but also have the ability to with stand the economic fluctuations, either good or bad. Social factors: Social factors basically deal with the attitude and preferences of the people particularly the demand and population shifts. Increasing trend of people towards migrating into urban areas has affected significantly the economic well-being of rural areas. However, on the other hand, urban areas need to boost their economic growth and development to compensate huge number of people migrating from rural areas. In addition to this, if we take into account the education aspect people in today’s era, it can be seen that they are more inclined towards acquiring higher education and as a result, there are demand shifts with people preferring more competent and high standard schools as compared to low standard schools. Keeping in view these aspects, organizations need to devise such strategies that are coherent with individuals’ choices and preferences. On similar lines, St. Joseph primary school has to incorporate all these important factors that are being audited by the researchers. Technological factors: Applegate and Johnsen (2007) there are various technological factors that affect businesses. These include technological changes in the industry, technological replacement, licensing, patents etc. we know that technology has transformed this world into global village. So, organizations in an attempt to keep pace with the changing world need to update them with modern technology. This signal St. Joseph primary school that in order to keep them updated. They need to inculcate modern technology into their day to day activities and should impart student the knowledge of modern technology. SWOT analysis: According to Chapman (2006), SWOT analysis provides businesses with detailed information of the opportunities available for new acquisition, threat from the competitors after the launch of competing products, strengths of the company that can help them in achieving high market share and the weaknesses that can keep them away from doing so. Following is the SWOT analysis of St. Joseph primary school: Strengths: Extra-curricular activities that include football, gymnastic, cricket and Irish dancing Known as one of the most popular primary schools Weaknesses: Is meant for high and middle level income groups Target market is individuals in urban areas whereby children in rural areas are more in need of higher education. Opportunities: To expand its franchise in other parts of South America To upgrade school to the college level To provide career counseling to the college students Threats: Montessori, an Italian chain of schools is one of the threats. Unsuitable market, political and economic conditions Marketing objectives: Smith and Taylor (2004) suggest that marketing objectives should be such that they affect the mind of the target audiences in such a way that it generates awareness, interest and repetitive behavior. In order to develop marketing communication objectives, a company must have a fair idea of its marketing objectives Varey (2002). Following are the marketing objectives of St. Joseph primary school: Increase enrollment of the students by 15% over next 12 months. Increase market share by 5% over the next 12 months. Increase expansion of the school by means of establishing franchises by 15% to 30% in next 12 months. To develop an extensive network of online materials for primary school students outside the border of Ecuador to earn huge revenues. Marketing strategies: Hughes and Fill (2007) suggest that there are three entities that are important and critical to the success of the businesses namely customers, marketing channel and stake holders. They emphasize on the fact that different types of communication strategies need to be designed for each of these groups. Rationale behind designing marketing strategies:  According to Dahlen, Lange and Smith (2009) customers are least interested in knowing the positioning strategies of any organization or the tools employed by them for marketing their product/service. Customers are interested in knowing that whether the product is going to fulfill their needs and if so, then how effectively. They want to know the reason behind selecting a particular product/service in the presence of other alternatives and whether they are going to derive any benefit from the product. In other words, they are not interested in knowing the positioning strategies or the product but they are interested in the benefits of the brand/service. So in order to provide them maximum benefits, it is advisable to introduce innovative marketing strategies that create awareness among customers. Market segmentation: According to Croft (1994), there are several approaches of dividing the market. One of the approaches addresses user behavior that deals with questions like what do they buy and why do they buy and the second approach focuses on consumer characteristics that deals with question like who buys. However, under market segmentation we have different sections that are given as follows: Geographical segmentation: St. Joseph primary school for the purpose of marketing their services, segment the market on the basis of geographical boundaries. The geographical segmentation made by them is as follows: Country: South America Ecuador Rural and urban area: Urban and semi-urban areas Demographic segmentation: Age: 5-14 years Family size: small and adult children. Gender: Female,male Income: Upper middle families (50,000 to 70,000); high (Above 70,000) Occupation: business people, job holders. Education: Graduates and post graduates Behavioral segmentation: Behavior of a selected segment effects the buying of a service to a greater extent. Keeping in view the behavioral characteristics market is segmented on the following factors; User status: 1st time user, regular user. Loyalty status: Medium and strong. Readiness stage: Aware, interested and desirous. Attitude towards service: Enthusiastic and positive. Reason for market segmentation: According to McDonald and Dunbar (2004), market segmentation is necessary for the businesses to achieve continuous growth. I have segmented the market on the basis of geographic and behavioral segmentation because the marketing focus of the St. Joseph is basically to create awareness among high income families regarding the importance of schools operating domestically as most of the elite class people tend to send their children to boarding schools. In addition to this, I have segmented the market on the geographic basis because the basic purpose if to introduce and provide services to the urban and central areas of Ecuador. Market positioning: According to Sandhusen (2000) market positioning is defined as a positioning of a product or a service relative to the competing products and services. Marketers have to decide on the aspects that help them in positioning their product or service in the competitive world. St. Joseph primary school as expanded their services to the Ecuador so they need to position themselves in a way that brings them huge number of students. Most of the families want to impart religious education to their children and that is what St. Joseph is famous for as it educates children according to the teachings of Mathew as they say “go and make disciples of all nations”. Moreover, their good repute in UK will also bring huge number of students to them. Target market: Target market will be the children ranging from 5-14 years who have to acquire basic education. Based on the fee structure, children of high and middle level income people will be targeted. Marketing mix strategy: According to Haberer (2010), the central role of marketing mix is to deliver value to the customers and the greater customer satisfaction. Successful organizations after segmenting the market into different sections target the most attractive and promising segment. However, after deciding on the target market organizations then move on towards developing marketing mix strategies. Following are the marketing mix strategies developed by St. Joseph primary school: Product: St Joseph primary school aims at providing valuable services to its target customers that are none other than the children. They meant to provide high standard educational services that enlightened the children spiritually and morally as well. Price: The price charged for the services are as follows: Admission fee 25$ (one time) Registration fee 5$ (one time) Campus development fund 10$ (one time) Fund for books and stationary 15$ Monthly tutuion fee 25$ Fee to be submitted at the time of admission 80$ However, admission fee, campus development fee and registration fee is to be submitted one time but tuition fee and funds for books and stationary that make 35$ is to be submitted monthly. Place: School will be located in Ecuador that is a part of South America. However, expansion to other areas of South America will be made over the period of 12 months if desirable results are achieved from the current strategies employed. In addition to this, huge money will be invested on the development of website to make all the material available online to the parents. Promotion: For the purpose of promoting the school following promotional activities will be conducted by St. Joseph primary school: Social media marketing: According to (Evans, 2008) social media marketing is a way ahead from traditional means of marketing i.e. electronic and print media. It is not that it has replaced any of these means but it is just that it has added a lot for the organizations to market their products on social and public forums. Time Period Activity Budget allocated 1 year Facebook, twitter and MySpace 50,000$ Contingencies and controls: Controlling the actual performance with desired performance is important for businesses to critically evaluate their performance in terms of achieving their intended goals. Controlling the actual performance in a way that it matches the desired standard is what that is required. Following are the aspects that need monitoring and were evaluated critically to see if they fulfill the desired standard. Quality control is one the aspects that need not to be overlooked by organizations. Controlling quality at its maximum will enable company to earn good repute and high profits. Though St. Joseph primary school is giving high quality education to the children in UK it needs to maintain this quality of education in Ecuador as well. Talking about marketing campaign budget, the allocated budget was 200,000$ but the entire promotional activities were planned in124, 000. This shows that the actual performance was better because the rest of the amount will be used time to time if need arises according to the circumstances. Proper system for parents’ feedback needs to be developed. Any company cannot just earn revenues from its promotional campaign but other factors like satisfied customers are also critical to the success of organization. Keeping in view this customer relationship management process needs to be focused on. No online material is available to the teachers and parents in UK. To achieve best performance and to earn high profits all the required material related to the courses and term papers’ syllabus should be made available online. Huge number of students can be enrolled in the school if it initially offers free admission to everyone. That can help them in achieving their intended objective of 15% increase in student enrollment over the period of 12 months. Financial Considerations: As St. Joseph primary school aspires to expand its operations in Ecuador so to comply with the law they have to get a license for carrying out their operations over there. Thus, there is a fee and cost to be incurred by the St. Joseph primary school. Following is the budget that is being prepared by the financial experts to see that if it can carry out its operations in Ecuador. Following is the detail of the costs associated with the expansion: Capital cash flow Amount Cost of furniture (100,000$) Cost of computers (150,000$) Total (250,000) Operating cash flow Revenues 500,000$ Selling and admin expenses (100,000$) Other costs (entry fee) (50,000$) Total 350,000 Net cash flows 100,000 This shows that with the operating expenses of 150,000 and capital outlay of 250,000 the net cash flow that the school will be earning is 100,000. Strategies employed for response to competitors: Montessori, an Italian school chain can be one of the competitors of the St. Joseph primary school. Keeping this in view, they need to design strategies that are different from those adopted by competitors or in coherence with them. Possible strategies that can be pursued by them are to promote their school by conducting heavy promotional activities, and by offering competitive fee. These strategies if pursued will not only enable them to achieve high market share but will develop in them the potential of becoming market leader in education sector. Later on, if successful they can employ these strategies for carrying out expansion in other parts of the world as well. Bibliography  Applegate.E and Johnsen. A. (2007). Cases in advertising and marketing management: real situations for tomorrow's managers., Rowman & Littlefield. Bensoussan.B and Fleisher. C. (2008). Analysis without paralysis: 10 tools to make better strategic decisions., FT Press. Chapman. R. (2006). Simple tools and techniques of enterprise risk management., John Wiley and Sons. UK.  Croft. M. (1994). Market segmentation: a step-by-step guide to profitable new business., Routledge. Dahlen,M Lange,F and Smith,T .2009. Marketing Communications: A Brand Narrative Approach., John Wiley and Sons.UK Evans. D. 2008. Social media marketing: an hour a day., John Wiley and Sons.UK Haberer. (2010). Disneyland International Marketing Mix: International Marketing Mix of Disneyland Hong Kong., GRIN Verlag. McDonald. M and Dunbar.I.(2004). Market segmentation: how to do it, how to profit from it., 3RDed., Butterworth-Heinemann. Sandhusen.R. (2000). Marketing., Barron's Educational Series. Smith,P and Taylor, J. 2004. Marketing communications: an integrated approach.,4th ed., Kogan Page Publishers., UK Varey. R. 2002. Marketing communication: principles and practice., 2ND ED., Routledge., London. (Web 1). Infoplease. Com. Available at: http://www.infoplease.com/ipa/A0107479.html ., [assessed 23rd april, 2011] (web 2). US Department of State., available at http://www.state.gov/r/pa/ei/bgn/35761.htm., [assessed 23rd april, 2011] (web 3) St. Joseph primary school., available at http://www.stjosephsschool.org.uk/., [assessed 23rd april, 2011] Read More