Marketing of Food Processors - Essay Example

? Marketing of Food Processors Table of Contents Table of Contents 2 MACRO Environment of KENWOOD 3 MICRO Environment of KENWOOD 4 Competitive Environment of UK 6 Porters Five Forces Model for KENWOOD for its business of FP731 MultiPro 6 Buyer behaviour of Kenwood FP731 MultiPro 8 Product life cycle of Kenwood FP731 MultiPro 8 Diffusion of Innovation Model 10 BCG matrix of Kenwood FP731 MultiPro 11 AIDA model of Kenwood FP731 MultiPro 12 STP segmentation 12 Marketing mix 13 Marketing Recommendations 13 Marketing Environment 14 References 15 MACRO Environment of KENWOOD The macro environment of KENWOOD for its business of food processor named FP731 MultiPro – white, might be analyzed with the help of an analytical technique, PEST. It is one of the most renowned and effective technique as compared to many others. Political- the home appliances organization of KENWOOD is one of the most reputed one but need to tackle effectively with the laws and regulations of the nation of UK. Apart from this, the organization also needs to obey with the systems of value Added Tax (VAT) accurately in order to maintain the operations and functions of the organization appropriately in long run. Economic- due to economic downturn, the per capita income and unemployment rate declined, thereby declining the buying behaviour of the individual. As a result, inflation acted as one of the important factors that influenced the productivity and profitability of theof KENWOOD to a significant extent. Along with this, it also hampered the gross domestic product (GDP) and gross national product (GNP) of the nation of UK thereby hindering the economic scenario to a significant extent. Social- KENWOOD always desired to offer high concentration over corporate governance factor so as to improve the conditions of the society. Along with this, it also tried to present extremely trendy and fashionable items so as to satisfy their changing requirements in this age of inflation. Only then, the reputation and brand image of the organization might be maintained in an effective way as compared to others. Technological- as technology is enhancing in every now and then, so the KENWOOD always tried to offer varied types of inventive and innovative products. This is done to satisfy the target customers thereby amplifying the profitability and total sales of the organization to a certain extent among other rival players. Therefore, from the above mentioned points, it might be depicted that the organization of KENWOOD needs to offer varied types of fashionable products at a competitive price so as to retain its portfolio in the market of UK. MICRO Environment of KENWOOD The micro environment of the organization of KENWOOD for its business of FP731 MultiPro food processor might be evaluated with the help of SWOT analysis. It is also another extremely renowned method. Strengths- High brand image- due to the presence of wide range of trendy and fashionable products, the brand image and reputation of KENWOOD enhanced to a significant extent. Along with this, the range of total customers also enhanced thereby amplifying the profit margin and productivity of the organization. Large market share- as KENWOOD always tried to offer value-added products at a competitive price. So, it acted as a positive cause for the organization that amplified the position and popularity in the market among others. Varied types of innovative functions- the demand of KENWOOD is enhancing at a rapid pace mainly due to its varied types of trendy functions and operations. This also acted positively on the organizational portfolio thereby amplifying the total sales and revenues in the market among other rival players. Weakness- Lack of customer services- due to lack of customer’s services, KENWOOD is reducing its brand image and reputation in the market. And the profit margin of the organization is also declining at a significant extent among others rival players. Opportunities- Expansion in new markets- the chances to expand into various new markets is enhancing at a rapid pace. As a result, the equity and uniqueness of the organization might get increased in the coming years. Along with this, the reputation and profit margin of the organization might also get improved to a certain extent among other existing rivals. Invention of new products- the chances of presentation of varied types of inventive products is increasing at a rapid pace thereby amplifying its range of customers. Apart from this, this might also prove effective for the organization thereby amplifying its profit margin and loyalty within the minds of the customers. Threats- Threat of new entrants- as the segment of kitchen appliances is extremely competitive so the threat of new entrants is extremely high. And so, the organization needs to offer varied types of inventive products in order to retain its portfolio in long run. Threat of substitute products- it is also extremely high due to the presence of numerous rivals. And so the organization needs to offer high attention over research and development so as to retain the customers for long run (Pahl & Richter, 2009, pp. 456-567). Competitive Environment of UK In-spite of extreme downturn, the market scenario of kitchen appliances of United Kingdom is extremely competitive. This is mainly due to the presence of numerous players such as Hitachi, Electrolux, Arcelik, Beko and many others. So, the intensity of rivalry is extremely high in the market of UK among others so the best way to retain the image and distinctiveness is to offer value-added differentiated products. Such a strategy is used by the KENWOOD for its business of FP731 MultiPro food processor in order to retain its portfolio in the market among others. This proved extremely beneficial for the organization thereby amplifying its profit margin and reliability in the market among others. Apart from this, the organization also decided to offer extremely trendy and inventive sort of products so as to attract new customers and to retain the older ones. Only then, the profit margin and aggressiveness might be maintained by the organization in UK market among other existing rival players. This might help the organization from the fear of new entrants within the regions of UK thereby retaining is supremacy among all. Porters Five Forces Model for KENWOOD for its business of FP731 MultiPro The porters five forces model is recognised as one of the most well-known and renowned techniques. It might be used to evaluate the effectiveness of the brand within the segment of kitchen appliances in UK. The bargaining power of the buyers- the bargaining power of the buyers of KENWOOD is extremely high for its business of FP731 MultiPro food processor. This is because; such type of devices is presented by numerous rival players offering varied types of inventive features and benefits. Therefore, in order to maintain the dominancy and image within such a competitive market scenario, the organization decided to offer varied types of inventive features so as to retain the customers for longer period of time. Only then, the profit margin and total sale of the organization might remain stable in-spite of extreme rivalry in the market of UK. The bargaining power of the suppliers- the bargaining power of the suppliers is quite low due to the negative impacts of inflations, over the raw materials and technologies utilized in preparing it. So, it declined the popularity and supremacy of the suppliers in the segment of kitchen appliances in UK market. The threat of substitute products- the threat of substitute products is also increasing at a rapid pace. Therefore, in order to retain the brand image and portfolio of KENWOOD in the market, the management need to offer high level of concentration over research and development. Only then, the organization might become able to present differentiated products at a quite competitive cost as compared to others. This is the only way by which, an organization in today’s era might enhance its sustainability and reputation. The intensity of competitive rivalry- the intensity of rivalry among the existing players such as Electrolux, Beko, Hitachi and many others within the market of UK is extremely high. Keeping this fact in mind, the organization decided to offer more stress over promotional campaigns. As a result, the level of awareness about the features of the product enhanced thereby amplifying the profit margin and total sales of the organization in the market of UK among other rival players. The threat of new entrants- the threat of new entrants is also extremely high in the market region of UK among others. Therefore, in order to retain the aggressiveness and reliability within the customers of market of UK, KENWOOD needs to offer highly inventive product so as to satisfy the needs and requirements of the customers. Only then, the level of sustainability of the organization might get enhanced in future era. Buyer behaviour of Kenwood FP731 MultiPro The rate of disposable income and per capita income of the citizens of UK enhanced to a significant extent due to improvement in rate of employment. As a result of it, the buying behaviour of the citizens enhanced resulting in amplification of the total sales and profit margin of the Kenwood to a certain extent among other existing rival player. Apart from this, as the organization has been trying to offer value-added products at a quite competitive price. This strategy acted as a cornerstone for the organization thereby attracting a large array of customers towards the brand in the entire market among others. Not only this, another reason that enhanced the buying behaviour of the customers of UK is the craze to save time and energy. So, purchasing behaviour of the customers increased that enhanced the market share and brand value of the organization of Kenwood FP731 MultiPro in the market of UK. Product life cycle of Kenwood FP731 MultiPro In this age of competitiveness, each and every product need to pass through a specific set of stages, regarded as product life cycle. It is the stage, in which the organization desires to maximise its profit margin and reputation in the market among other rival players. However, the organization might enhance its revenues only if the level of awareness is high among the customers among other substitute products. The product life cycle of the product Kenwood FP731 MultiPro is described below: Introduction- it is described as the first stage of PLC. It is the very vital stage as in this stage, maximum extent of the organization desire to enhance its image and position in the market by presenting vigorous promotional advertisements. By doing so, the level of awareness regarding the features of the product also gets entirely cleared that helps in attracting numerous customers thereby amplifying the profit margin. Similar strategy might be followed by KENWOOD in order to develop a clear identity in the market of UK. As a result, the figure of profit of the product is quite low and high investment cost. Growth – it is second stage and it starts with the enhancement of sales figures and profit margins. And moreover, in this stage, the product becomes more renowned and large array of customer get attracted towards it. Therefore, in order to enhance the market share, the organizations desire to present inventive features so as to retain the brand image and loyalty within the minds of the customers. The similar strategy is used to enhance the market share and sales of the organization in the market of UK. In this stage, the organization also tries to promote varied types of extra features such as 3 litre bowl capacity, 1.5 litre liquidiser, 100 W powerful motors and many others to attract customers (Kenwood Limited, 2013). Maturity stage- in this stage, customer awareness is extremely high and so the sales and profit margin figures continues to grow with a significant extent among others. However, in this stage, numerous other competitors enter the market. So, the organization desire to offer extra new features in order to extend the shelf space of their product as compared to others. Similarly, KENWOOD also offers wide of inventive attachments in order to make the trouble of chopping, slicing and grating very easy and problem free. This marked the sales rate of the product thereby amplifying its equity and distinctiveness in the market of UK (Sandhusen, 2008, pp. 456-567). Decline stage- this is the last stage and it marks with reduction in the total sales and profit margin of the product. This is mainly because, the market conditions becomes entirely saturated due to change in customer taste and preferences. Such a condition also aroused with the product i.e. Kenwood FP731 MultiPro and so to retain its portfolio, it promoted itself as the most influential multipurpose kitchen machine appliance with a glossy finishing. This acted as a boon for the organization thereby fascinating a wide range of customers that improved its market share and productivity to a certain extent (Kenwood Limited, 2013). Therefore, it might be stated that, in order to retain the prosperity, innovation and promotion are the most essential requirements of an organization in this age. Product life cycle Source: (Rogers, 1995) Diffusion of Innovation Model It is also recognised as a two–step theory, i.e. new idea generation and the technology used. According to this theory, the time-period required to make the target customers aware about the product so as to fascinate them towards it. However, to do so, varied types of elements are required; among them the advertisement media plays a very essential role. This is because, if the customers do not become aware about the features and benefits of the new product or services, then the rate of sale and profit margin might not get enhanced (Pride & Ferrell, 2011, pp . 456-567). Source: (Palmer, 2012) Similar strategy need to be followed at the time of introduction of Kenwood FP731 MultiPro in the market of UK. At the initial stages, huge rate of advertisement campaigns and promotion need to be presented so as to enhance the awareness level of the customers. Only then, the demand and total sale of the product might get enhanced among other rival players (Porter, 1986, pp. 456-567). BCG matrix of Kenwood FP731 MultiPro In order to sustain for longer period of time, maximum extent of the organization desire to measure their competitiveness and position in the market among others. In order to do so, BCG matrix is used. It includes four stages such as star, cash cow, dog and question mark (Ferrell, 2012, pp. 345-456). Star position- it is the best position, in which the organization comprises of highest market share and highest market growth. Such a situation occurs, when the target customers of the product Kenwood FP731 MultiPro become well aware about its features and benefits. Only then, both profit margin and demand of the product enhances significantly (Porter, 2008, pp. 345-567). Cash cow- in this position, the market share remains high but the market growth slows down. Such a situation arouses, when a competitor such as Electrolux or Beko, enters the market with a substitute product. Therefore, in order to mitigate the risks, the organization of needs to present some inventive features such as 1.5 litre liquidiser or100 W powerful motor to retain its attractiveness (Kenwood Limited, 2013). Question mark- in this stage, the marketer of the product gets confused as the market share remains low. In such a situation, the organization might desire to offer high attention over promotional campaigns in order to increase its demand (Christensen, 2003, pp. 345-456). Dog- in this condition, both market share and market growth remains low and so KENWOOD needs to present inventive features to fascinate customers towards it. AIDA model of Kenwood FP731 MultiPro AIDA model means attention, interest, desire and action. However, in order to enhance the level of awareness, promotion or advertisement is extremely essential. Otherwise, the level of profit margin or demand of the product might not be increased in the market. Similarly, in order to improve the market share and market growth, the company KENWOOD needs to offer high level of attention over promotional campaigns for its product FP731 MultiPro food processor. This strategy might improve the awareness level thereby amplifying the demand and profit margin of the product to a certain extent (Clemente, 2002, pp. 345-456). STP segmentation As the product i.e. Kenwood FP731 MultiPro is entirely safe and secured so they might be used by all the members of the society. However, it is segmented mainly to the premium customers with high life style and income group. And, it mainly targets the females with age group 25- 45 years. Apart from this, the organization might position this product, as the most demanding multipurpose kitchen machine appliance, that reduces energy as well as time. Then the brand image and reputation of the organization might surely get enhanced (Baines & et. al., 2011, pp. 456-567). Marketing mix Product- in order to enhance the demand of the product, Kenwood FP731 MultiPro the organization needs to offer varied types of inventive features. Only then, the changing needs and requirement of the customers might get fulfilled and the reliability and portfolio of the products might remain stable (Boundless, 2013, pp. 775- 875). Price- the organization needs to offer competitive pricing in order to retain the demand and competitiveness of the product, Kenwood FP731 MultiPro in the market in the next 12 months. Otherwise, its demand might decline along with its sales as well (Mallin, 2009, pp.456-567). Place- the management of the organization might try to present FP731 MultiPro food processor in all hyper, hypo and super markets in order to retain its awareness level within the minds of the customers. Promotion- the management might present varied types of promotional campaigns and hoardings in order to enhance and retain the awareness level of the customers for the next 12 months (Lancaster & Massingham, 2010, pp. 241- 345). Marketing Recommendations In order to retain the demand and competitiveness in the market for the next 12 months, KENWOOD needs to offer varied types of extra facilities such as discounts or free gifts with the products, extra features of the product (slicing and grinding attachment) or many others. Along with this, promotion needs to be presented so as to make the customers aware about these gifts and features. Only then, the customers might get attracted towards the brand even after such a long time among other substitute products thereby amplifying its demand and profit margin to a significant extent (Dibb & Simkin, 2008). Marketing Environment If the product, Kenwood FP731 MultiPro, might be introduced in a market, that is free from competitors and substitute products then its demand and total sale might get enhanced at a rapid pace. Keeping this fact in mind, the management of the organization might try to expand into such type of markets that comprises less umber of kitchen appliance competitors. Then it might be effective for KENWOOD for its business of FP731 MultiPro food processor in the next 12 months. References Boundless. (2013). Marketing: - Page 775. New York: Springer. Baines, P. & et. al. (2011) Marketing, 2nd edition. New York: Oxford University Press Clemente, M, N. (2002). The Marketing Glossary: Key Terms, Concepts and Applications. London: John Wiley & Sons. 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