How to Market Books - Case Study Example

REPORT ON THE CURRENT CUSTOMER BASE OF ANTONIO’S BOOK CLUB Name Unit name Semester Tutorial Group Group members’ names Table of Contents Page 1. Executive Summary 4 2. List of figures and table 3 3. Introduction 5 4. Background knowledge 6 5. Analysis 6 5.1.1. Issue 1 Findings 6 5.1.2. Issue 1 Recommendations 8 5.2.1. Issue 2 Findings 10 5.2.2. Issue 2 Recommendations 10 6. Summery and conclusions 11 7. Recommendations for further investigation 11 8. Limitations of data 12 9. Bibliography 12 10. Appendices 12 1. List of Figures and tables Page Fig. 1 6 Fig. 2 6 Fig. 3 7 2. Executive Summary Antonio’s Book Club (ABC) has great potential for growth and financial prowess. Regardless of the recent constant mergers and takeovers, the club can still reap the benefits of the customers it has accumulated over time and make new market segments make even more profit. By taking advantage of the underexploited youth books category of the club, revenues in that category will double. There is also great potential to more than double the current male customers who stand at only 20%. Direct marketing of the new title of Florence art book to the existing customer base will yield tremendous results. The report provides recommendations and more marketing channels like the social media, which will generally increase the profitability of the club. In addition, expect recommendations for further research, which will ensure continued success of the club. 3. Introduction After the recent frequent mergers and acquisitions, ABC is now under a fresh new breath. The report will relay and explain the current situation of the club using an analysis that will rely on a sample of 800 members. ABC has recently undergone frequent mergers and takeovers, which have certainly affected the business’ operations. That, notwithstanding, does not spell great doom to ABC. The customer base has not necessarily been affected adversely by recent developments in the company. This could be attributed to the secured commitment by the customers to ABC caused by the various marketing channels explored. The customer base for ABC has been increasing and book selection growing. Ordinarily, the growth in customer base should ensure increased income and stability for the business. However, for ABC, there has been no commensurate effect on the profits side. This begs the question on what needs to be done so that the company can stem the earnings. This is important owing to the fact that the company invests many resources by e.g. advertising and maintaining the increased customer base. The report aims to provide insight to the management on the current market base for ABC to enable stemmed earnings for the business. It provides deep understanding of the market base and further provides recommendations on on the strategy to promote the Florence Art Book. It contains an analysis of data on the current customers and explaining the important relationships, behaviours and expected trends in the future. One of the assumptions in the report is that the category of youth books represent books read by the youth. The report also relies on the statistical data which comes with inaccuracy. The data was collected by keeping a database of the club members at the first purchase of any material in the club and the subsequent purchases. 4. Background Knowledge ABC was formed in December 2004. It has accumulated many members over time, and the customer base has grown impressively to over 500,000 active members. This is owing to the fact that ABC rolled out unique offerings and explored various channels of advertising online, on television, and in newspapers. With the increasing number of customers, it was apparent that the profits are to increase. Surprisingly this did not happen. It was therefore decided that ABC adopts a new method of marketing to stem revenues. The method entailed drawing information from their database to know their customers more. This to enable them design tailor made marketing which will target the right audience. 5. Analysis 5.1.1. Issue 1 Data findings Typically, customers of ABC spend an average of 261 dollars on books. The member who spent the highest spent 365 dollars and on the lower side was 212 dollars Figure 1 Figure 2 From the pie chart above (Figure 1), it is clear that females form the higher proportion of the customers of 80%. If follows that their revenue contribution is 75% of the total revenue ABC gets. This is shown in Figure 2. The average number of months after the first purchase for the customers is 28months, which is approximately 2.3 years. The longest time is 92 months, which is approximated, since the company opened doors. There is a trend of shorter lengths of time indicating that there is potential for the customers becoming a member within a shorter time, less than 28 months. Figure 3 below reveals that the bestselling category is cook books followed by child books. Youth books are selling at low rates. Figure 3 5.1.2. Issue 1 Recommendations Undoubtedly, there is a lot the management can do to improve the revenue to stabilize profits. Figure 3 shows that the youth books have low sales about half compared to child books. To tap into the youth who expected to read books in this category, the company could use adopt marketing strategies like using the social media (Lior 2012). Direct marketing could also help but social media marketing like using facebook, twitter and LinkedIn will yield better results. This is because using social media will reach the youth at their area of interest. The youth category has the potential of being the bestselling since youths have time and energy to read. They need to read more than any other group since they are the ones who are in transition, in careers or need to build their skills. They are the ones in colleges and universities. To anticipate increased number of readers in the youth books category, the company should add additional books in this category to meet the anticipated demand. The company should also target to increase purchases by the males. The male part of the population of course has resources to buy the books and they need a lot of content. The males’ accounting for only 20% the customers is worrying. Marketing activities, which target the males, will go a long way to drive up the sales of the company. This may entail placing adverts on magazines for males, erecting banners on male friendly sports and games like soccer or generally doing advertisements targeting the males. A needs-assessment analysis is to be carried to find what king of books interest the males so that they could be added to the categories (Baverstock 2008). However, in drawing these conclusions, a number of assumptions were made. It is assumed that the youth books category is read by the youth. In addition, this statistical analysis is because of randomly sampling 800 out of the over 5000, therefore accuracy is not 100 per cent. A further research into the 4P’s of marketing including “product, price, place, and promotion will improve sales”. The books features should be investigated to ensure that special characteristics, which can make them stand out from the competition. More features will be added to suit the market needs. The procuring of the books should be made easier so that it is convenient to the customers. Promotional strategies, which will target and optimize on the nonperforming segments of the population will woo the potential customers into the business. The price to be set should be reasonable considering the market trends, the targeted customer’s competition. The price should also be in line with the company’s reputation in the market. 5.2.1. Issue 2 Data findings. The new title, Florence Art book is seen to be mainly bought by the customers who bought books in the art previously. The data also shows that customers with a long time since they made their first purchase in the company. This trend shows that the book has not penetrated to new members of the club. 5.2.2. Issue 2 Recommendations The management should extract the contacts of the customers who had purchased books in the art category previously. Direct marketing should be targeted to such customers since art could be their favorite category. Those who enjoyed reading the previous art categories are most likely going to purchase the Florence art book so that they enjoy again. The company should also invest in general advertising to tap into new reader for this title. The company should advertise and promote the book to new market segments. There is great potential for the books sales to rise. Social media marketing is another recent avenue which could raise the sales of this new title (Lior 2012). 6. Summary and Conclusions The report shows that ABC has potential to pick up again and maintain profitability. The data used was relied upon in addition to expertise in this field. The data showed that the males as portion of the population have not been exploited well although they need to read and they have resources. Marketing activities to target men and carrying out a needs assessment on the kind of books men need is the antidote for this situation. The youth books category also has potential to double its sales by marketing the books among the youth. Social medial is a good marketing tool to market books to the youth. The customers who bought books previously in the arts category mainly buy the new title, the Art History of Florence. To increase its sales, the customers who previously bough art books should be contacted and the book directly marketed to them. General advertising to target new segments of the population will also improve the sales of this book (Baverstock 2008). 7. Recommendations for Further Investigation To further increase profitability of the business, the management should conduct an analysis into the marketing mix of the company, that is, product, price, place, and promotion. This will ensure that the ABC has books, which give it competitive advantage, the right price and the right promotion mechanisms. Additionally, ABC will make it easier and convenient for the members to purchase books thus keep the members and attract new ones. The financial and accounting procedures of the business should also be looked at reviewed. 8. Limitations of the data The analysis in this report is subject to the weaknesses of usage of statistical data. The analysis was done on a sample of randomly selected 800 customers; therefore, accuracy is not 100%. 9. Bibliography Baverstock, A 2008, How to Market Books, Kogan Page. Lior, L 2012, How social Media Marketing is Like Hosting a Book Club, Available at: http://www.pria.com.au/priablog/how-social-media-marketing-is-like-hosting-a-book-club [Accessed Dec 29 2012] 16571109891886 10. Appendices Antonio’s Book Club data (attachment) Read More