Marketing Strategy for a Nuclear Power Plant Development Proposal in Sizewell C - Essay Example

?Marketing Strategy for a Nuclear Power Plant Development Proposal in Sizewell C Table of Contents Marketing Strategy for a Nuclear Power Plant Development Proposal in Sizewell C 1 Table of Contents 2 Macro Environmental Analysis 3 Political 5 Economic 5 Sociological 6 Technological 6 Environmental 6 Legal 6 Target Market Analysis 7 Competitor Analysis 7 Marketing Mix 8 Product 8 Price 8 Place 8 Promotions 9 People 9 References 10 Annexure 11 Macro Environmental Analysis Political Democratic Government (Next general Election in 2015) Health and Safety at work Act Nuclear Installations Act Licensing Nuclear energy market regulated by Environment agency of England and Wales & Scottish Environment Protection Agency (HSE, 2007). Economic Public Private Partnership model High gestation periods Risk of cost overruns Global oil prices stimulate demand (refer annexure1) Sociological Public opinion largely towards environmental protection Crisis in Japan has further aggrieved the situation Individuals and forums advocating against use of nuclear energy. Technological Stiff challenge from renewable sources of energy that are cost effective and environment friendly (refer annexure) European commission developing a white paper that makes it compulsory to source 12 percent of energy from these sources and to 20 percent by 2020 (Euractiv, 2007) Safety standards to be upgraded with latest technology. Environmental Environmental concerns have increased enormously after the crisis in Japan. Germany to close down all its nuclear plants by 2022 (Baker, 2011). Nations in Europe trying to reduce dependence on fossil fuel based energy sources Large sale environmental legislations for renewable power plants Legal Stable and democratic government in UK Health and safety legislations very strict across all nations in Europe Economic recession leading to credit crunch Political Political factors largely play an important role in the success of a nuclear plant. UK appears to be in a favourable position considering the fact that the nation boasts of a strong, stable and democratically elected government. The attractiveness of the nation also emerges from the fact that unlike its German counterparts the nation does not have any plans for banning nuclear power. Economic Nuclear plants are largely capital intensive and require a huge time to become operational. This escalates the cost. Moreover with the current turmoil in the economy of European nations it becomes difficult for organizations to undertake a massive project. However considering the fact that UK is beginning to show signs of recovery and the credit markets beginning to show signs of resurgence it appears to a be a good choice for investment. Sociological Sociological aspects pertaining to the use of non renewable sources of energy have gained large scale importance considering the growing awareness of individuals towards the environment. Nuclear plants have added concerns about security following the aftermaths of the crisis in Japan. Technological Concerns about safety and security of the workers and general population assume importance in case of nuclear power plants. Enactment of the Health and Safety at Work Act in UK has served to include more technological concerns. Environmental Nuclear plants have always been under criticism from the society due to the aspect of harmful emissions. Every nation has its set of environmental laws that are mandatory for every nuclear power plant. Legal There are a number of legislations in place for nuclear reactors. UK as compared to some of its counterparts like Germany still favours setting up of these plants as a large price of energy for meeting the ever growing energy requirements. Target Market Analysis The nuclear energy market in UK can be divided into five main target segments namely, the civilian customer, defence, power supply to submarines and corporate customer segments (Wright, 2010, p.1). The company would normally target the corporate customers including those with manufacturing facilities under a direct contract as well as the individual retail customers. In order to reach out to retail customers the company would lobby with various political parties as it would require access to grids that are controlled by state run players. The company would also participate in forums and showcase its attractive service by undertaking a promotional campaign. Competitor Analysis The main competitors of nuclear power are the renewable sources of energy apart from the traditional energy sources like thermal power plants. Renewable sources of energy like solar energy has gained widespread acceptance following their eco friendly nature and lower set up costs as compared to the other sources. However sources like solar energy are less reliable and are very expensive that makes them less sustainable for meeting the huge energy demands. Coal based thermal plants have come under severe criticism owning to the drastic effects on environment. Nuclear energy offers a clean and long term source of energy that can meet the energy requirements. However safety and other social issues need to be addressed so as to make them more viable. Effective safety measures can go about a long way in ensuring an energy source that can offer a long term solution to energy problems. Marketing Mix The elements of marketing mix include the aspects of product, price, place and promotions. This section would analyse the prospective strategies of the upcoming nuclear power plant in Sizewell C. Product The nuclear power plant would have upgraded safety and security measures to protect the employees as well as the locality. Specific contingency plans would also be framed for taking quick action in the event of natural disasters. The building of the reactor would be made from materials that would have superior protective features and would be resistant to explosions and other natural disasters like earthquakes and cyclones. Price A discriminative pricing strategy would be adopted towards retail as well as corporate customers. The pricing strategy would be made in accordance with the prevailing market rates with initial discounts. There would be customised pricing for corporate clients that would differ on a case to case basis. Place The company building the nuclear power plant would invest in downstream industries like setting up distribution towers. This would help in generating greater revenues and would also reduce the bargaining power of suppliers. The company would also motivate and convince the other distributors to make inroads in to areas that would not be covered under their own distribution system. Promotions An effective promotional campaign would be used that would use all the possible channels including print, online and electronic channels. Ethical and safety measures along with focus on quality would be focussed upon to gain the interest of customers. The company would also participate in forums and trade fairs to showcase their product to the corporate clients. Effective corporate social responsibility measures would also be taken to showcase their commitment to the society. People An effective and advanced training program would be offered for the employees of the organization. There would be specific focus towards the aspect of safety and security and training would be provided to enable employees make decisions in case of emergencies. References Baker, N. (2011). Germany to Eliminate Nuclear Energy by 2022. [Online]. Available at: http://theenergycollective.com/nathanaelbaker/58502/germany-eliminate-nuclear-energy-2022 [Accessed on June 1, 2011]. Euractiv. (2007). EU renewable energy policy. [Online]. Available at: http://www.euractiv.com/en/energy/eu-renewable-energy-policy-linksdossier-188269 [Accessed on June 1, 2011]. HSE. (2007). The licensing of nuclear installations. [Pdf]. Available at: http://www.hse.gov.uk/nuclear/notesforapplicants.pdf [Accessed on June 1, 2011]. Money Week. (2011). Oil price performance in the last 5 years. [Online]. Available at: http://www.moneyweek.com/news-and-charts/market-data/oil [Accessed on June 1, 2011]. National Archives. (2007). The future of Nuclear Power. [Pdf]. Available at: http://webarchive.nationalarchives.gov.uk/+/http://www.berr.gov.uk/files/file39197.pdf [Accessed on June 1, 2011]. Wright, E. (2010). UK nuclear market opportunities guide and the EOSCP. [Pdf]. Available at: http://www.eoscp.co.uk/assets/files/UK%20Nuclear%20Market%20Opportunities%20Guide%20and%20the%20EOSCP.pdf [Accessed on June 1, 2011]. Annexure Annexure 1: Oil Price Movements over last Five years in UK (Source: Money Week, 2011) Annexure 2: Estimated Cost of Nuclear Power (Source: National Archives, 2007, p.67) Annexure 3: Cost of Power Generation (Source: National Archives, 2007, p.71) Annexure 3: SWOT Analysis Strengths Reliable energy source Cheap Eco friendly Can provide huge amount of power Weakness Concerns about radioactivity in the environment Safety issues Capital intensive Opportunities Growing energy demand Surging oil prices Environmental pollution from sources like coal Guaranteed energy supply Threats Growing concerns about safety of reactors following the Japanese disaster Strict legislations Vocal public sentiment against use of nuclear power (Source: Author’s Creation) Read More