Marketing Planning - Kit Kat - Essay Example

? Marketing Planning- Kit Kat Q1 Marketing planning is the process adopted by firms to analyze the market conditions and planning for successful operation. In the recent epoch, marketing planning is changing in various perspectives. They are trying to reduce costs and widen their distribution to a broad customer base. The managers of the business firms are trying to constantly upgrade their products (Henry, 2008). Considering the selling perspective the companies now try to adopt different aggressive and modern selling strategies; like Surf Excel creating artificial demand in the market. Companies give substantial importance to the desires and wants of the potential customers. Marketing Plans in the current economic system always succeed in a free market economy. The prices of the goods and services must be determined by the free forces of market demand and supply. Any state of disequilibrium in the market would be stabilized automatically by the free forces of market mechanism. Companies often adopt “go to market” concept that helps organizations to achieve unique value proposition to their targets. These propositions depend on the way the company focuses on its investments and business solutions. This strategy usually responds to whom, what, how much, how and where a company would operate and cater its services. Q 1.2 Nestle accounts a sale of over 1 billion Swiss francs from 29 major branded goods manufactured under it (Dibb, 2001). It is a giant food producing firm generating about 339,000 employments in the economy. Its assets are now worth 126.22 billion as estimated in 2012 (Qin, 2010).. Jamal and Prahalad in 1996 stated that strategic planning is not strategic; the future is assumed to be more or less same as the present. The planning must be subversive. The top managers are most resistant to change and they fail to provide people different responsibilities to manage changes. The senior managers should observe activists as positive. The organizations must always use all their knowledge to discover the unconventional ideas. Business strategies can often give surprises. The business strategies must be democratic (Kew and Stredwick, 2005). Therefore in the context of Nestle, Kit Kat being a common chocolate produced by the company, the focus should be on product quality. The company must enhance its quality so that it can uphold its reputation in the current competitive chocolate industry Q 1.3-1.4 There are various techniques of organizational auditing. Out of the major techniques this essay concentrates on the PEST technique of organizational auditing (Strauss, 2010). It means it would concentrate in the Political, Economic, Social and Technological aspects that affect the business of Nestle featuring its product Kit Kat. The success of a marketing plan largely depends on the internal working culture of a business firm; like the precise relationships between the top managers and employees at different levels. If a firm maintains a good financial and accounting system then they are likely to introduce successful marketing plans. The level of research and development also influences the competitive power of a business firm. The resources and capabilities of a business firm largely influence the extent accomplishment of marketing plans. Image and brand equity are also important determinants of a good marketing plan. The essay will now hypothetically assume a case study about Kit Kat’s business in China. The country has a socialist market economic system; thus sate excise strong control over the activities of the private organizations. If the Chinese government increases the level of taxes in chocolates; the company may be forced to increase the selling price of the product and thus will shift the incidence of taxation on the consumers. In such a situation the demand for the product would fall. Rather tastes and preferences of the consumers are changing and buyers who are empowered are demanding more from the products. The country accounts for a growth of about 10% in terms of GDP, thus the company can expand their business over time. Though the country is growing rapidly but still there are a lot of price fluctuations due to changing tax rates imposed by the government. In terms of technology China is highly developed and this can help the company to upgrade their state of technology. Spotting the markets that are likely to grow quickly will make the difference between the winners and losers of tomorrow’s chocolate landscape. According to official government figures, current hot spots include India (annual growth rate 15%), China (9%), Russia (6%) and Mexico (3.8%). They all exhibit a number of key factors that help them stand out from the pack, including a youthful population, rapid capital inflows and retail consolidation. There are also several internal factors that would affect the business of Kit Kat in China. Problems pertaining to cultural difference may arise in the operations of the company. The company may also face problems in accumulating skilled labourers and may also lack efficient manufacturing plants in China. Q 2.1 There are various barriers in the context of marketing plans made by an organization. The managers often confuse between tactics and strategy in a business plan. It becomes difficult to isolate the marketing plans from the various operations. The marketing plan adopted by a company often lacks systemic approaches in it. The employees engaged in strategy making fails to prioritize objectives in many situations. The culture of corporate working has been often antagonistic. In the contests of marketing plans of Kit Kat there are several problems. One of the significant barriers is the fact that the product is a chocolate that is high in calorie. Most of the people in the modern world are conscious about their health issues. They are diet conscious and avoid having fatty foods. Thus it is observed that the consumer’s attraction of the product is gradually reducing overtime (Annacchino, 2003). Rather the target consumers of the product are only a small share of the total population. Mainly people between age group 12 to 20 years are the target customers of chocolates. Thus it is a difficult task for the firm to pitch the product in the market and make it more attractive to a wide customer base. Q 2.2 Although there are several barriers in the context of marketing planning, these barriers can also be systematically removed. The mangers should try to intensely understand the difference between business plan tactics and strategy (Fifield, 1998). The companies should try to isolate their marketing plans from the various operations. The officials should not confuse the idea of marketing function and marketing concept. The managers often should have proper ideas about the marketing plans and strategies. The workers taken in a corporation should be well equipped with proper knowledge and skills. The marketing plan adopted by a company should be systemic in its approaches. The culture of corporate working should not be aggressive. In the context of Kit Kat, the firm should try to broaden its customer base and the firm should make their product Kit Kat attractive among the buyers of all ages. Q 3.1 The product is already an established commodity in the market and shares certain goodwill among its consumers. This essay will try to establish the 4Ps for the chocolate. The concept of four Ps actually involves four factors namely product, price, place and promotion (Fill, 2009). Kit Kat is basically a four finger stripped chocolate since its launch in the market. It can be analyzed that the consumers would be attracted to get the same chocolate if the company changes its shape and gives a new look to the product. This shape could be round like a lollipop. The general price of the product is $ 19.99 for 12 packs of Kit Kat the company can set a cost plus pricing for its new product. It can initially set a narrow profit margin for the new product and launch it in the market. Winning the consumer’s satisfaction and goodwill it can later augment the price of the product. Hence it is evident that the company can pursue penetration pricing. In case of places the company should try to systematically distribute their new product in the market in large numbers of shopping destinations (Cagan, 2006). For the purpose of distribution the company can appoint distributors. Promotion of a new product should be done with a lot of expertise. The company can make new advertisements for the chocolate. These advertisements can be shown in various modes of media like internet, television etc. Q 3.2 A good marketing plan helps give a proper direction to the effort taken in the marketing activities of a firm. It helps to define accurate tasks and responsibilities (Hatton, 2000). It gives a better insight about the new emerged markets in the economy. It would help the company by raising finance for its capital expenditure. A good marketing plan helps in making the company save money and time engaged in marketing activities. It also helps the company to generate more clients. Q 3.3 There is a series of various steps and features that are required to appraise a new product in the market. The first step is idea generation where managers can set several ideas about the new product (McDonald, 2002). These ideas can be made with respect to the new shape, composition, packaging etc. of the product (Bangs, 2002). The next step would be to screen the best idea; for example let the new shape of the existing chocolate be the best idea. In order to set the concept development of the product the company can simply target at selling the new product to consumers whose age is less than 10. Next the company should match the plans set with the current market conditions (Stephenson, 2005). Finally with technical implementation the company can start manufacturing and commercializing the commodity. Q 3.4 The pricing, distribution and promotion of the new product should be introduced by considering the fact that the outcome reaches to a broad customer base. The company may set a narrow profit margin for the new product and launch it on the market with low price, so that a large strength of customers actually purchase and taste it. In case of promotion the best method concerned should be through television as it helps to reach a large section of viewers. Q 3.5 The strategy formulated by a company to launch a new product can be opposed by various barriers in the market. If the company sets a higher price of the new product it may not be able to compete with the existing rivals in the market. In that situation the company can offer free sampling of the product and prove its qualitative difference with respect to other similar products in the market (Reddi, 2013). For this the company can adopt several methods to sell their product. One of these methods can be internet selling. Q 4.1 The American marketing association have set some codes of ethics that primarily focus in the moral issues that are concerned underneath all economic activities carried out by organizations. The codes make the corporate associations aware about their duty for the society when they carry out their business activities. Thus while operating the companies must look into the ethical and moral values of all its shareholders. Maintaining ethics help in business development and management by enhancing the long term careers of the workers. It also helps the business firm to lead in the competitive market. While promoting the products the companies must not exaggerate about the quality of the product virtually just to win a strong customer loyalty. The company must not distribute their products in an inequitable pattern across various markets. The firm during the course of their market research must not directly harm the potential rivals in the industry. The marketing plans set by a company should be sustainable to the environment. Any activity in highlighted in the marketing plan should not influence the environment adversely (Sirgy, 2001). The marketing activities of the firm should not produce negative externalities. The private marginal benefit of the company’s activities should not be more than the social marginal benefit. For example the packaging utilized by the new Kit Kat should use the least amount of plastics or papers. The company will succeed in its marketing plans only if maintains the aesthetic values of society and nature. All the codes of ethics would help to improve the marketing operations of Nestle for Kit Kat. Among all, transparency in the marketing operations and knowledge about the intermediaries, suppliers and distributors are the two most important codes of ethics that can influence the marketing plan of Kit Kat. Q 4.2-4.3 Counterfeit or imitation is a practice where the original trademarks of a company are infringed by some other company. These companies imitate the logo or the style of the products which is actually produced by the original owning company. The spread of counterfeit goods is excessive in the recent years. According to the reports of the Counterfeiting Intelligence Bureau (CIB) these types of goods constitute almost 5 to 6 percent of the global trade. The organizations are affected adversely by the counterfeits of goods. The consumers are sometimes not able to differentiate the products and thus they land up purchasing the pirated commodity thinking it to be the original one. In this way the company loses their market demand. The imitated goods are never good, they are poor in quality. The consumers are unaware about this fact and often mistrust the brand quality of the original product. The company’s must be very active to abolish imitation of their products in the market. They can invent special hollow grams for their logos and should legally defend imitation of the following. The firms must also renew their patents continuously. Thus any action of imitation can be proved to be legally offensive by the firms. Reputed organizations like Nestle must always undergo fair trading. Trading ethically would make the organization serve money value to the consumers. This would help the firm achieve goodwill in future. Ethics in business sometimes lead to lower profit but in the long run they always prove to be good for the organization. It would help Nestle to improve its resources and capabilities. Reference List Annacchino, M. A., 2003. New Product Development: From Initial Idea to Product Management. Oxford: Butterworth-Heinemann. Bangs, D. H., 2002. Market Planning Guide. New York City: Kaplan Publishing. Cagan, M., 2006. Streetwise Business Plans: Create a Business Plan to Supercharge Your Profits! New York City: Adams Media. Dibb, S., 2001. Marketing: Concepts and Strategies. Connecticut: Houghton Mifflin. Fifield, P., 1998. Marketing Strategy. Oxford: Butterworth Heineman. Fill, C., 2009. Marketing Communications: Interactivities, Community and Content. Essex: FT/Prentice Hall. Hatton, A., 2000. The Definitive Guide to Marketing Planning. London: FT/Prentice Hall. Henry, A., 2008. Understanding Strategic Management Anthony. Oxford: Oxford University Press. Kew, J. and Stredwick, J., 2005. Business Environment: Managing in a Strategic Context Wimbledon: CIPD Publishing. McDonald, M., 2002. Marketing Plans: How to Prepare Them, How to Use Them. Oxford: Butterworth Heinemann. Qin, Z., 2010. Introduction to E-commerce. Berlin: Springer. Reddi, C. V. N., 2013. Effective Public Relations and Media Strategy. Delhi: PHI Learning Pvt. Ltd. Sirgy, M. J., 2001. Handbook of Quality-of-Life Research: An Ethical Marketing Perspective Berlin: Springer. Stephenson, R., 2005. Marketing Planning For Financial Services. Farnham: Gower Publishing, Ltd. Strauss, R., 2010. Marketing Planning by Design: Systematic Planning for Successful Marketing Strategy. New Jersey: John Wiley & Sons. Read More