Introducing an Innovative Product to the UK Market - Case Study Example

1. Introduction The process of introducing a successful brand in today’s market especially global market can be lengthy and an uphill task. There are a variety of ideas and suggestions on the most successful way of market a product either a service or a good. In all the suggestions, however, the main focus is on the consumer. The purpose of this report is to develop a full marketing strategy to introduce and market the product “The Smarttrainer” in the UK market having been sourced from China. 2. Objectives The aim is to successfully launch the product in the UK market thereby reaching a deeper penetration of the market of consumer products. Additionally, it is desired to increase market share, sales and profit as well as to get a competitive advantage by operating in different markets. 3.0 The product- Smarttrainer Shoes. 3.1. Description The Smarttrainer is a shoe also known as ‘intelligent’ shoes. They are sports shoes that have permanently built in drip in each shoe. The chips measure a variety of aspects of the user’s measurement and upload this in real time to a display/controller worn on the wrist. The chip runs on a built in battery that is kept charged by the movement of the shoe. The use of the chip is each shoe enables great accuracy in measurement as the movement of the shoes, for instance, stride distance and speed are measured by the chips comparing their location against one another. 3.2. The unique selling point It is specially designed shoe which is accompanied by a wrist controller. The shoe add the wrist controller are sold as one product. Data from the shoe is transmitted wirelessly to the wrist unit. The wrist acts as a display, data store and also a timing device. With this unit, the user can read data and programme the chips to give the information required. The following data can be measured or displayed on the wrist unit: Speed Stride length Heart rate Recovery time Calories burned Elapsed time Stop watch Lap time Circuit timer Distance (total + trip) 3.2 What needs is it satisfying? The product will come in three types all containing the same chips. These are : a track running shoe, a general cross-trainer and a walking shoe. These will be one type of wrist for all types of shoes. It will help the consumer to get vital information on health and other areas especially when exercising. It will help show the progress the consumer is making when exercising . 3.3. Product Classification. It is important for Goldsport to understand how the product will be classified in the UK market. The Smarttrainer is considered to be a durable product. This is because the product will not be consumed relatively quickly as it last as for a long period of time. () considering this, the company can be aware of how to position the Smarttrainer in the UK market. 4. The Environment To reach the set objectives, it is obligatory to understand the current situation of the firm. It is therefore essential for the company to be aware of the environmental factors that may affect its product in the UK. According to Masterson and Pickton (2004), the environment of a firm can be divided into two parts; internal and external environments using the pestle method of analysis. S 4.1. The Internal Environment Masterson and Pickton (2004) advocated that the internal environment of a firm consists of five basic functions. These functions are human resource. the internal environment refers to issues that are within the control of the company finance, marketing, production and finally development and research. 4.2. The External Environment The external environment consists of the macro and micro environment of a firm. The external environment refers to issues outside the control of the firm. The macro-element relates to the world around the firm while micro deals with the market place. 4.2.1. Macro-environment The macro-environment of the firm includes the political, economic, social-cultural, technological legal and environmental variables. Political Businesses are according to Perner, vulnerable to the changes in the political situation. The situation in the UK however is that people are more concerned about their health and weight. Fitness is taken seriously and therefore the product will be demanded. The government has highlighted that weight issues especially obesity is becoming a problem and the people therefore are getting more involved in athletic activities. Economic On the basis of National Statistics (2007), the UK economy rose in the second quarter by 2007 by 0.8%. Furthermore, the unemployment rate dropped by 0.1% to 5.4% hence more job vacancies. Masterson and Pickton (2004) highlighted that the facts rising sales, rising prices and more jobs are a sign of an upturn which means it is a good time to sell and introduce products to due to higher demand brought by increased disposable income. The difference in the exchange rates is also a fact to consider. Introduction of the product in the UK market where the pound is so strong means imports from china will be less expensive for the company. (Brassington and Pettiot; 2007) Social This component of environment concerns the implications of cultures relative to society and includes the general beliefs, values and behaviors within the UK. (Adock et al, 2001) people in the UK and around the world are embracing the idea of exercise. This means that introduction of the Smarttrainer will be embraced by the consumers positively. Technological Another aspect of the environment that may affect the product is the technical aspect. According to Brassington (2007), it can contribute to the development of product design, quality and range of products, as well as the advertising processes. It also impacts how potential consumers can access information on the product. Being a new product in the market, communication proves to be a serious setback on how to inform and reach the market the product. 4.2.2. Micro- environment The micro-environment deals with the market place in which the firm is operating . it deals with the issues which are not controllable by the firm. These include; the customer, competitors and the collaborators. There is a major competitor the “the Nikeplus” which uses similar system that interfaces with an ipod nano. In addition, there are other competing products with some similar features hence it will prove a bit difficult to introduce the product although there is a difference in the system used. 5. Market Segmentation. Market segmentation is about break up a market into sections or segments so that marketing efforts can be focuss3ed towards a particular segment. (Masterson and Pickton, 2004).For the Smarttrainer, it is the best to separate the target consumers instead of attempting to appeal to the mass market. It will also allow the method of planning s to be more concise and focused on each group selective needs. Segmentation should be done in relation to the product range. 5.1. The primary target audience Due to the fact that the product is divided into 3 ranges. The most important consumer is the athletes. This is in regard to the track running shoe which enables them to keep track or their progress. Success in introducing the product ensures that the wider public will automatically demand the product given the advantages. 5.2. The secondary target audience. This is the mass market as a whole. With the health conscious lifestyle of the people, the market is ready for the product. The shoes to be marketed to this group are the general cross trainers and also the walking shoe. With the government showing concern over the issue of obesity it is apparent that people will embrace the product. 5.3 Consumer Behaviour The company must look at segmenting the target market in terms of customer behavior. The first aspect to analyze is the particular occasion in which this product will be consumed, and what benefits are sought through its consumption. The first influence in customer buying behavior is psychological. How the customer perceives the product is important in understanding how marketing messages are interpreted (Adcock et. al, 2007). The majority of consumers overlook insignificant promotional messages created by companies (Brassington and Pettitt, 2007). The company must therefore create messages that attract and relate to target customers. The messages should involve some type of strategy which will influence and entice the potential customer (Brassington and Pettitt, 2007). Another psychological aspect which influences buyers is through the learning process (Adcock et. al, 2001). The purpose of creating and implementing promotional messages is to provide the customer with the necessary information surrounding the product. This will hopefully lead to a trial of the product, so that ultimately the consumer’s will be able to develop a relationship with the brand due to knowledge of past experience (Brassington and Pettitt, 2007). The company can add to the learning process by creating promotional activities which display the product’s unique added benefits, or by providing specific situations in which the product should/could be consumed (Brassington and Pettitt, 2007). Motivation is an important element of the buying influence, because it is the key factor in which the consumer acts on (Brassington and Pettitt, 2007). The brand providing information through marketing tactics is not enough to influence the target consumer to make the purchase. For the Smarttrainer for example, sponsoring social sports activities and giving incentives will be rewarding. The final psychological factor which influences target customers is attitudes (Brassington and Pettitt, 2007). Consumers’ beliefs and attitudes can vary per product; however the goal of the company is to influence and promote the positive beliefs associated with the product. 6. Distribution Channel: There are several different channels the company can use in order to distribute the product to the UK consumers. The most efficient channel would be to send it from production to a wholesaler, from the wholesaler to the retailer, and from the retailer to the consumer (Brassington and Pettit, 2007). The wholesaler can be beneficial for the company because it will have the responsibility of purchasing large amounts from the manufacturer, and then separating and distributing the products to the retailers (Brassington and Pettitt, 2007). It would be incredibly inefficient and unpractical for the company to directly distribute the product to its customers, thus it must rely on retailers and other stores to sell the product (Adcock et. al, 2001). Retailer/store: The channel in which the product is distributed is only a part of the process of getting the product to the customer. In distributing its product, it is also necessary for the company to carefully determine which types of stores should supply the product (Brassington and Pettitt, 2007). Possibly the most fundamental store outlets for the product are sports houses and fitness centres. Becoming increasingly popular and reliable among UK customers, fitness centres appear to be the prime location for this product. These stores experience a large amount of consumer traffic throughout any given day, which will provide maximum exposure for the product. Another type of store that should carry the product is sports houses. Although there may not be as much customer traffic, due to its late hours and accessibility, sports houses are also exceptional suppliers. Market coverage: The final consideration for distributing the Smarttrainer is the level of market coverage. Due to the fact that the company is presenting this product to the UK, the level of distribution should be intense (Brassington and Pettitt, 2007). Also, since it is virtually unknown in this market, the product should be supplied in as many locations as possible. This helps the consumer to easily identify the product, as well as offers them a level of convenience so that minimal effort is put forth on their behalf (Brassington and Pettitt, 2007). Intensive distribution provides and effective method of delivering the product to its target consumers. 7. Price Pricing is a substantial element of the marketing mix (Masterson, 2004). Perceived value is generally the way in which consumer’s identify with the brand’s image. By evaluating quality of product, as well as price, the consumer can develop its perceived value (Masterson, 2004). The trade price is set at £35 and will be the same for all the shoes in the range. Competitive-based pricing is directly correlated to pricing strategies for new products such as the Smarttrainer. As established, the product should target its pricing closely to its competitors, because if it sets a much lower price, this can influence customers to establish certain assumptions about the product’s quality (Brassington and Pettitt, 2007). The product should offer an initial, temporarily lowered price, in order to entice customers without affecting their opinions. 8. Promotion Promotion is one of the 4P´s of the marketing mix. Masterson and Pickton (2004) describe different tools within the Promotion part, which are categorized as the promotion mix including advertising, public relations, personal selling, direct marketing and sales promotion. In this chapter I would like to explain, how this tools could be used while promoting the Smarttrainer in the UK. Naturally a short term objective could be to raise awareness and establish the product in the market place as well as to gain a customer base. To reach the target audience and to communicate effectively the firm may use above mentioned tools to communicate trough different media. While doing this, the company needs to pay attention to the different psychological or behavioural processes of the customer before purchasing a product. Masterson and Pickton (2004) therefore mention a model called AIDA, which demonstrates these stages. AIDA stands for Attention, Interest, Desire and Action. To reach the set promotion objective of raising awareness the firm needs to get the Attention and Interest of the target audience. This could be done by using the tools as follows: Advertising: Communication through different channels like radio, magazines, newspapers or billboards. Thereby, I would recommend using magazines and newspapers which the target audience is likely to read, for example sports and health or lifestyle magazines (Men’s health, shape, fit for fun etc.). In doing so, it is essential that the advertisement angles the attention of the target audience from the very first viewing or hearing. This approach will warrant effective communication because of reducing costs and avoiding mass media. Pubic Relations: This promotion tool has the aim to promote goodwill between the organization and the outside world. To reach this goal, the company could run a sport event (with different activities), undertake a sponsorship of a famous football team or publish press releases about the new product and the benefits it provides. To attain the second described short-time objective of gaining a customer base and establishing the product in the market place, it is necessary to support the need of the product, i.e. to generate Desire and afterwards Action. This could be done with the following tool: Personal selling: This is an opportunity to get the target audience in contact with the product by talking to potential customers in sports clubs, leisure parks or even in fitness centres. Thereby, free samples would make the customer try the product and create the desire to buy it. 9. Conclusion If a product like Smarttrainer wants to be successful in the competitive market of sports, it has to meet the needs and wants of the customers. As described in this report, more and more people involve themselves in athletic activities and increasingly become health-conscious and worried about their well-being. The product is aimed at athletes and is related to sports. Because of this change in people’s behaviour, the product is not purely aimed at sports people but at health-conscious, active and sportive customers. The product fills this gap and tries to convert these customers to use the Smarttrainer because they are already interested in a healthy lifestyle and well-being. The difficulty while launching the Smarttrainer could be to raise awareness of the product and establish it in the market place, because of the competitors. Therefore, the promotion mix needs to be well defined and get the people in contact with the product as soon as possible. Another important point is the positioning of the product; it needs to be clear in its benefits as well as clearly distinguished from its competitors to make the value and quality of the product obvious and to defend the price. Bearing this in mind, the Smarttrainer could have great success. References Adock, D. et al., (2001). Marketing Principles and Practice. 4th ed. Harlow: Financial Times Prentice Hall. Brassington, F. and Pettitt, S. (2007). Essentials of Marketing. 2nd ed. Harlow: Financial Times Prentice Hall. Lars Perner. Introduction to Marketing. Last retrieved from the World Wide Web on 29th February, 2008 from www.consumerpsychologist.com/intro.htm Masterson, R. and Pickton, D. (2004). Marketing: An Introduction. Maidenhead: McGraw-Hill Education. National statistics, (2007). Economics. UK: National statistics. Last retrieved from the World Wide Web on 29th February, 2008 from www.statistics.gov.uk/instantfigures.asp National statistics, (2003). Census 2001: Health of the nation. UK: National statistics. Last retrieved from the World Wide Web on 29th February, 2008 from www.statistics.gov.uk/cci/nugget.asp?id=298 National statistics, (2003). Hours worked. UK: National statistics. Last retrieved from the World Wide Web on 29th February, 2008 from www.statistics.gov.uk/cci/nugget.asp?id=341 Read More