Marketing Plan - Assignment Example

THE OF YOUR PAPER IS LISTED AT THE TOP THE FORMAT IS TO ALWAYS HAVE AN UP SIDE DOWN PYRAMID Presented to the byR Your Full Month Year THETITLE OF YOUR PAPER IS LISTED AT THE TOP THE FORMAT IS TO ALWAYS HAVE AN UP SIDE DOWN PYRAMID Executive Summary Marketing refers to a management function concerned with determination, anticipation and satisfaction of the customer demands. To achieve this, the marketing department must carry out effective market researches to determine their target market and the features of the market that influence the consumption of their products.

Additionally, through appropriate market researches, the commercial organization determines the appropriate ways of production thus perpetuating their profitability. The same is the case with the TerraMai, a wood milling company. The company operates in a precarious market owing to the numerous players who have therefore heightened the competition. TerraMai sells processed wood products such as boards and trusses among many other tailored wood products. The company, works closely with architectures and builders throughout the entire nation to determine the specific wood products such professionals want.

The housing industry is a fast growing market in the country; this implies that the company has an equally large and fast expanding market as it seeks to provide the essential wood products required by architectures to finish their work. The company’s greatest potential market therefore comprises of architectures and constructors who may need the products after their acquisition of a tender to develop a structure. TerraMai projects a relative annual sale ranging between 3million to 5million US dollars.

However, the sales vary depending on the prevailing factors in the market most of which fluctuate. The marketing plan below thus provides a brief overview of the different marketing features the company employs in order to improve its market shares. The plan includes an analysis of the company. This provides a general overview of the company with its strategic operational features. Additionally, the plan covers the features of the target market most of which may influence the infiltration of the product thus improving te profitability of the company.

The plan thus includes the appropriate market researches and their possible outcomes. Coupled with an appropriate analysis of the company’s marketing mix, the plan thus seeks to develop a sizable market for the company and safeguard its annual growth and development within the market. TABLE OF CONTENTS COMPANY DESCRIPTION 1 Legal Name and Form 1 Company Mission 1 Management 1 Location 2 Development Stage 2 Product or Services Offered 2 Consumer Purchase Process 9 MARKETING MIX 10 Price 11 Place 13 TerraMai’s primarily market area is U.S. and Canada.

The company sell its product direct to customers. No distributors or resellers. The company sell its to architects and designers who specify use the products for mostly commercial projects – like corporate offices, restaurants, etc. The contractor who is managing the job – or a sub-contractor who is installing the product – is the person who actually executes the transaction and provides payment. There is no relationship to other channel members Facilities required – it have a production facility, warehouse space and office space.

All at one location. TerraMai also have suppliers and vendors who supply us with various goods and services – from products, to finishing, etc. Degree of market exposure is high among the top architecture and design firms, such as Gensler, Perkins+Will, HOK, Smithgroup, etc (The TerraMai Story, 2013). 13 Promotion 13 Works Cited 15 COMPANY DESCRIPTION Legal Name and Form TerraMai S Corporation (Small Corporation) Registered in California History TerraMai was founded in 1991. TerraMai works with top architecture, designer, builder, and manufacturer to provide one-of-kind reclaimed wood products for premiere commercial, residential, and other projects.

Company Mission TerraMai mission is source, manufacture, market, and sell the reclaimed wood products (Westrick, 2009). The broad vision of company is to be the primer reclaimed wood brand in the world. TerraMai must be the first brand architects and designers choice. TerraMai started business with a commitment to providing materials that look terrific, perform like none other, and have the absolute best pedigrees since they are all reclaimed. TerraMai is a great resource for reclaimed woods.

TerraMais’s source of variety of places such as railway ties, warehouses, mills, tanks, and any other previously used wood. They think using reclaimed material is a great way to add a unique element to homes. Management CEO and Owner Ken Westrick attended high school in Hong Kong, and got MBA from Stanford University. Ken brings an appreciation for the environment and an international outlook to TerraMai (Ken Westrick- Owner & CEO, 2013). Location The location of TerraMai is 8400 Agate Road, White City, OR 97503 with offices in San Francisco, New York, Philadelphia, and Asia.

Development Stage Since last 20 years, TerraMai has had extensive experience, expertise, and custom capabilities to serve their customers such as architectures, design firms, and home owners. TerraMai searches out the most beautiful, interesting, and high performing reclaimed woods from a verity of sources around the world. TerraMai’s international sourcing network is unmatched in the reclaimed wood industry, and its growth rate is increasing rapidly. Product or Services Offered TerraMai products include some of the hardest and most durable hardboards in addition to offering the widest variety of reclaimed woods.

It also offers custom milling and finishing services. The main products of TerraMai are flooring, paneling, siding, decking, lumber, and stair treads. INDUSTRY ANALYSIS Industry Size and Growth Trends Industry Size According to the standards, the reclaimed wood industry consider as a one of the big industry, which contributing in the economy. The company’s marketing manager Matt Nichols estimates the size of the reclaimed wood industry in the U.S. to be about $50M in annual gross sales (Nichols, 2013).

Industry Growth Trends The market for ‘weathered’ reclaimed wood has grown considerably over the past three years. This trend has peaked over the past year and seems to be declining. Trend now is for reclaimed wood products with different types of finishes and colors. Trend over the past few years has been for cold color tones – white, grey, black, brown, and away from red, gold, amber, auburn, yellow, pink wood tones. This trend continues to grow. Lots of small companies continue to enter the market due to growing product interest and low barrier of entry.

Companies that can deliver consistent product in this industry continue to have success, those that cannot (and there are many) struggle and fail (Nichols, 2013). Environmental Analysis Product Vulnerability There only a few types of reclaimed woods that are commercially viable. These materials are readily available to anyone with the interest and ability to purchase. TerraMai’s high overhead costs requires to charge more than other resellers of the same products (Nichols, 2013). TerraMai rely on reputation, experience and overall higher level of sophistication to command higher prices for the same products available from other suppliers.

It lose a considerable amount of business to other suppliers that undercut TerraMai on price for the same of comparable products. As a result, The Company is trying to develop unique, proprietary reclaimed wood products, such as products with special finishes (Nichols, 2013). Technology There are two types of technology in this industry – production technology and systems technology. TerraMai’s production technology is mid-level. Matt said, “Our systems technology (how we manage accounts, manage opportunities, estimate and bid jobs, etc.) is probably the most advanced in our industry.

” (Nichols, 2013) Cultural   The interest and demand for sustainable/green/eco products continues to grow, which gives reclaimed wood products a growing advantage over conventional wood products (Nichols, 2013). Economic The demand for reclaimed wood continues to grow based on aesthetic and ‘story’ advantages over conventional wood. The demand for sustainable wood products also continues to grow. For these reasons the market is increasingly willing to pay more for reclaimed wood over conventional wood products.

The building market in general continues to strengthen. According to Matt the company is experiencing increased activity over the past few months (Nichols, 2013).   Political Policies designed to encourage or require sustainable/green/eco building practices and materials continue to expand on the local, state and federal levels. These policies are more prevalent in urban and democratically controlled areas of the country. Competitor Analysis TerraMai has the following competitors in the market Environmental Mill & supply, Inc.

, Mountain Lumber Company and Pioneer Millworks (Nichols, 2013). There are also more competitors in the market but those are the main competitors. The details of these companies are below:- Environmental Mill & Supply, Inc. According to competitor’s information, “Environmental Mill & Supply specializes in the rustic look. The company provides a variety of wood products for residential or commercial applications. Environmental Mill & Supply produces such wood products as post oak and aromatic cedar paneling, pine decking, cedar and pine siding, trusses, beams, flooring, and more.

Environmental Mill & Supply uses planers, edgers, bandsaws, and other equipment to make moldings and custom woodwork that have a more finished look. The company sells leftover cedar sawdust and shavings by the bag or truckload for stable and stall use” (Environmental Mill & Supply, Inc., 2013). Pioneer Millworks According to another competitor’s information, “Pioneer Millworks is blazing a trail in the reclaimed-wood millworks industry. The firm reclaims or harvests a variety of wood species with a range of grades and finishes to produce timbers, flooring, and millwork.

Much of the wood Pioneer Millworks reclaims comes from old barns and industrial buildings. The company has also launched a unit that manufactures engineered flooring that uses recycled material and formaldehyde-free adhesives. Sister company New Energy Works Timber framers focuses on creating timber-frame structures” (Pioneer Millworks , 2013). Mountain Lumber Company Third competitor’s information is also not very different from others. It say, “Mountain Lumber sells wood with a history.

The company obtains historic wood from old buildings, piers, and other structures slated for demolition and then resaws, kiln-dries, mills, and grades it for further use as flooring, beams, stairs, cabinets, and other products. It also reclaims wood from several countries in Europe and from Russia and China. Mountain Lumber has provided historically accurate woods for restoration projects on US presidents' homes, including James Madison's Montpelier, Thomas Jefferson's Monticello, and George Washington's Mount Vernon.

Mountain Lumber was founded in 1974 by president and CEO Willie Drake to find new uses for old lumber” (Mountain Lumber Company, 2013). Different From Competitors TerraMai is totally different from all its competitors in all ways. According to the company’s Brand Book, the following additions makes a company different from the competitors. •Sophistication. A sophisticated appreciation for modern, high-end design is key to TerraMai’s unique brand identity and separates the company from other wood companies.

•Sourcing. TerraMai travels the world to find the most special reclaimed woods, building a global sourcing network unmatched in the industry. •Manufacturing. TerraMai turn these prized woods into the highest-quality standard and custom products either in-house or through our outsource network of international and domestic manufacturing partners – a network unique in the reclaimed wood world. •Marketing. The company presents itself and its products in a way that engages the world’s top architects, designers and distinguishes TerraMai from all other wood companies.

•Selling. TerraMai work directly with leading architects and designers to help them realize their design visions; also work directly with all members of a project team – which can include contractors, installers, owners, developers, and marketers. •Scalability. TerraMai’s ability to do projects of any size – from a select, one-off piece to a 100,000 square foot flooring job – is unique in the reclaimed industry. This scalability offers beautiful, unique, sustainable options for designers and developers of even the largest projects.

•People. The TerraMai team consists of smart, hardworking people who share a passion for our products and our vision, supported by an organization committed to their success (Westrick, 2009). . TARGET MARKET Demographics As hinted in the summary, the company target market includes the architectures and constructors who use wood products in their constructions. Such are equally established companies who acquire tenders to construct a house and therefore determine the use of particular wood products.

This implies that the target market comprises of professional adults with an appropriate understanding of both their profession and the nature of the products they require. This way, they can explain and finance the particular products they want from the company. To develop an amicable relationship with such a target market, TerraMai must therefore manipulate such marketing mix features as the price and the product quality in order to win the particulate target market. Geographics The company operates within the country.

This implies that all its target market is within the country. However, the country is large and the company therefore requires appropriate marketing features in order to determine the demand and the appropriate ways of availing the products to the target markets. To achieve an appropriate share of the market, the company concentrates on the capital state in which it seeks to serve the city clients. This way, the company builds an appropriate reputation among the target market thus diversifying its market depending on the growth in the housing industry.

As most of the company’s esteemed customers travel out of state in national tenders, they are likely to contact the company for the fundamental wood products. Psychographics The target market comprises of professionals who seek specific values in the products they use in their daily endeavors. Understanding such a market is therefore easier. Their demand is particular and often varies depending on the nature of a tender they are working on at the time. However, as sane and mature professionals, they still demand quality in order to develop a reputation with their clients.

Just as other commercial organizations, they are also in the business with the view of maximizing profitability while developing a reputation to sustain their operations into the future. To achieve such, they must therefore seek particular quality of products from the company and ensure that the products they obtain are appropriate and reliable in their daily endeavors. However, with their professional expertise, they have the ability to describe their demands appropriately thus limiting the cases of mistakes and the delivery of poor quality products since they have the prowess to determine the quality of the products from the company’s work shop.

Consumer Purchase Process The purchase is a long and complex process that involves ongoing discussions between clients and company’s account managers, multiple rounds of product samples and multiple rounds of estimating, bidding and rebidding. This process generally takes 3-18 months. The product is usually selected by an architect or designer, approved by a client and purchased by a contractor/installer (TerraMai Terms & Conditions of Sale, 2013). Customers generally search for materials online and in-house libraries.

A large architecture firm in San Francisco or New York will have a material library with many thousands of material samples – carpet, tile, hardware, etc. It also frequently order custom samples to achieve a look to be able to find with a standard product. A large percentage of TerraMai’s sales involve custom products of some kind. Again, the designers select materials that are then approved by the client and purchased by the contractor/installer (Nichols, 2013). TerraMai is somewhat unique in this industry in that its sales strategy is built around company’s account managers developing relationships with architects and designers that then use repeatedly.

Account managers visit key contacts often and deal with via phone and email frequently. Because so many of TerraMai’s jobs are custom, the amount of work, time and interaction between designers and TerraMai account managers can be substantial. MARKETING MIX Product It is very difficult to figure about the classification of the product because business and consumer both buys the product directly from the company. In the broad sense, it would be in the consumer product. Furthermore, the product satisfies the needs of shopping product because consumer spend time on getting the information on price, product attributes, and product quality.

The products of the company are in a growth stage of development stage of the product because sales increase rapidly, profits increase, and it is on its peak. The branding is very important to the company for the products. According to company handout, it said that “To be the premier reclaimed wood brand in the world (Westrick, 2009)”. By “premier” company does not mean biggest. Premier means “first”. TerraMai must be the first brand let the consumer think of fine wood products. The one wood brand consumer esteem above all others.

TerraMai gives a guaranty of its products. The product always should meet the standards outlined in product specification sheet, character, dimensions, moisture, and grade (Product Warranties, 2013). TerraMai doesn’t accept any risk, or liability for problems resulting from shipping, storage, site conditions, installation, or maintenance of such product. If something wrong with the product, then product should be received back in its original form. The company’s sales department always help the customer service.

Customers could contact sales person by phone, email, by person, or by filling up the contact form on the company website. Price Price is determined based on cost of materials and production plus profit margin. The competitor’s price is also considered. Also the market price – what the company believe the market will pay for the product which is particularly relevant for inventories and products that are unique to TerraMai – like Moffett Field Redwood or Kukui Teak Engineered, etc. There are very few competitors in the U.S. that offer reclaimed teak, peroba and other reclaimed wood products sourced outside the U.S. The first objective is to earn the profit and then also keep the prices acceptable to our customers.

The CEO always aims to maximize the margin, and extremely focused on it. CEO always seeks to charge the maximum a client, or the market in general, will pay (Khan, 2013). The discount policy and credit terms for some of customers – in rare cases. The company resists all of these, and CEO personally sets or approves all pricing and terms on every transaction. Price is elastic to the quantity, product specification and customer. Again, CEO always aims to maximize margin and win the highest price on every transaction.

Different prices for customers for example, the price for customer A more than customer B for the same product if account manager can squeeze more dollars out of customer A and vice-versa. The exception is some of its ‘on the shelf’ products, like engineered teak flooring, where the price is generally set in advance. Company does consider discounts on products like these when larger quantities are involved (Khan, 2013). Place TerraMai’s primarily market area is U.S. and Canada. The company sell its product direct to customers.

No distributors or resellers. The company sell its to architects and designers who specify use the products for mostly commercial projects – like corporate offices, restaurants, etc. The contractor who is managing the job – or a sub-contractor who is installing the product – is the person who actually executes the transaction and provides payment. There is no relationship to other channel members Facilities required – it have a production facility, warehouse space and office space. All at one location.

TerraMai also have suppliers and vendors who supply us with various goods and services – from products, to finishing, etc. Degree of market exposure is high among the top architecture and design firms, such as Gensler, Perkins+Will, HOK, Smithgroup, etc (The TerraMai Story, 2013). Promotion TerraMai has salespeople who call on clients directly. It has a brand-conscious, comprehensive Website. Also, send out product samples to designers, contractors, etc. Company have an email list of 16,000+ architects and designers that sales people ‘blast’ every two weeks with information about products, projects, etc.

These email blasts are highly brand-conscious and market conscious. TerraMai rely on its website and email marketing exclusively in terms of media. Company do not use social media because of believe that it is of little value to business versus other, higher leverage marketing activities. TerraMai do not use print advertising because the cost is too high for the return given its resources – there are much more effective ways to spend its very limited marketing resources and dollars. The core message is that the most design-savvy wood company.

TerraMai understand what designers want and are better equipped than anyone else to give them what they want in terms of looks and quality. EVALUATION OF MARKETING MIX As a tool for marketing, the marketing mix analyzes some of the fundamental operational features for the company. The place, product, promotion and price are all important in the profitability drive of the company. The appropriateness of each of the above improves the profitability of the company as discussed above. Each of the features is appropriate and equally important for the profitability of the company.

Conclusion In retrospect, the marketing plan above provides the appropriate analysis of both the company and its target market. The specific features and marketing tools employed in by the company seek to determine and satisfy the market demands. As explained the company has an appropriate target market, it thus becomes important to analyze the features of the market in order to determine the most appropriate operational features to improve the profitability of the company. Works Cited Works Cited Environmental Mill & Supply, Inc.

(2013, October 21). Retrieved from Hoover's Network Sites: http://hoovweb.hoovers.com/company/Environmental_Mill__Supply_Inc/rtxhjji-1-1njht4-1njfaq.html Ken Westrick- Owner & CEO. (2013, 12 04). Retrieved from TerraMai web site: http://www.terramai.com/Pages.aspx?ID=40 Khan, S. J. (2013, 11 19). Finance Manager. (A. Shahid, Interviewer) Mountain Lumber Company. (2013, October 21). Retrieved from Hoover's Network Sites: http://hoovweb.hoovers.com/company/Mountain_Lumber_Company/rtysfji-1-1nji3i.

html Nichols, M. (2013, October 8). Personal comunication. (A. Shahid, Interviewer) Nichols, M. (2013, October 8). Personal comunication. Pioneer Millworks . (2013, October 21). Retrieved from Hoover's Network Sites: http://hoovweb.hoovers.com/company/Pioneer_Millworks/rtysthi-1-1nji3i.html Product Warranties. (2013, 11 11). Retrieved from TerraMai Web Site: http://www.terramai.com/pages.aspx?ID=43 TerraMai Terms & Conditions of Sale. (2013, November 03). Retrieved from TerraMai Web Site: http://www.terramai.com/pages.aspx?ID=176 The TerraMai Story.

(2013, 11 25). Retrieved from TerraMai: http://www.terramai.com/pages.aspx?ID=57 Westrick, K. (2009). Brand Book - Final. Mount Shasta: TerraMai. Westrick, K. (2009). Company Handout. White city : TerraMai. Appendix A Sample Figures and Tables Figure 1. Number of Financial Institutions 1995-2002 Table 1. Agency Providers: Relationships/Communications/Outreach Question 10: Factors in providing Care giving services Number Percent Cultural Identity 11 84.0 Ethnic Sensitivity 11 84.0 Racial Sensitivity 7 53.

0 Socio-economic status 7 53.0 Language Sensitivity 3 23.0 Cultural Competence 5 38.0