Marketing Principles of a Baby Product Company - Case Study Example

Marketing Principles Leading Baby Product Company in the UK that consider making entry into a Westbourne in district of Bournemouth a new market would have to adopt a strategy that would enable it to achieve intended results. Thus the baby product companies in UK have to maintain their market share in the face of dwindling consumer base which is increasingly arising from falling birth rate in the country. Baby product companies sells different types of baby equipments including baby cosmetics, soap and shampoo, cots, mattresses and bedding, car seats, prams and push chairs, feeding equipments, baby walkers and bouncers, baby monitors and range of toys which would required mostly by parents who have children and younger children. With the disposable income among young parents, particularly in the UK the baby care product market is increasing at a steady rate. 1) Customer Buying Behaviour The consumer demographics in the market for baby care products in the UK shows that an increasing number of kids and young children are taking to using variety of products which made for themselves to do their activities in safe and easy manner. Purchasing behavior of UK consumers of baby care products in particular is determined by price elasticity of demand plus a variety of external factors (Cook, 2007). Five senses as outlined below don’t essentially act as the ultimate determinants of purchasing decisions of consumers. In fact a bewildering array of endogenous and exogenous variables plays a very big role in consumers’ decisions. However, what’s seen, heard, felt, smelled and tasted matters in the immediate decision making process. Thus the family unit is the most basic factor which drives buying decisions for baby products. The value statement for the baby products can be based on the company’s customer value creation strategy with safety, care, quality and fun. As a value statement shows the first word is safety. This key concept has become a very big issue in the current times. For instance Baby Product comes from a variety of sources and a variety of countries. The potential customer must be informed about the level of safety for their kids. The word care carries a greater weight because parents and elders care for their kids. Similarly quality matters because children need quality products. Fun is associated with keeping the kids happy during the play time. Thus each baby product must be exciting enough to the kid. Thus a few extensive and serious research studies have to be undertaken in order to determine the extent of influence on consumers’ decisions to buy baby products and this should not be limited only to the semiotics but also extended to a study of how brand loyalties are formed even in the absence of any tendency to associate personal preferences of consumers with some product quality. 2) Future Local Planning Issues R&D department of the company will have to develop some innovative launching program for opening new outlets. In the first instance research must be carried out as to how to attract potential customers and treat those other regular consumers. The technology aspect of baby product selling depends on the cost factor and the operational safety of gadgets. The employees of the Baby Product Company unit deserve a higher level of training and education for target oriented productivity. They must be educated according to opening new outlets within defined time schedules (Hoffman, 2005). The sales people of the Baby Product Company should perform a very vital task in identifying market segments and pushing up sales in niche markets to maintain a steady cash flow. Thus they must be compensated on the basis of meeting sales targets. Finally administrative unit has employees who are trained to carry out such difficult task as managing the whole company on a day-to-day basis. The staff must be compensated by using an efficiency determination technique such as one based on regular attendance and optimum coordination. 3) Local Spending Power Indeed employment status has such a big impact on the purchasing decisions of consumers and therefore baby care perceptions of these consumers could have played a very important role on their purchasing decisions. In fact perceptions are influenced by the kind of advertising and promotion material being used by the baby care seller. These figures highlight one of the causal factors in marketing strategy used by modern marketers. Determinants of consumer behavior such as price variations and market imperfections are more likely shape the outcomes of a particular purchasing decision. Economic downturns such as the current one don’t allow consumers to behave independently. As such their purchasing decisions aren’t as articulate or rational as they are under normal circumstances. Thus UK consumer spending power has fallen dramatically due to the rise in cost of living. Therefore price related differences in the average customer profile are determined by the fact that the underlying customer preferences for baby care products are based on the necessity of the product and its price. Safety with superior quality is in demand in the baby product industry but the price plays a pivotal role. High price attracts some customers on the premise that the quality is far superior (Wright, 2004). Low price attracts some customers on the basis of affordability. However Baby Product Company need to adapt to the lower pricing and special pricing strategies in order to attract new customers in the region. 4) Demographic Trends Demographic segmentation refers to the practice in which the company focuses on age, gender, and similar characteristics. It’s the most popular strategy or basis for segmenting the market though its complicated nature at times necessitates fist hand information about customer behavior. While variables associated with demographics can be easily obtained and the related metrics would readily lend to interpretations, there is still a very demanding process of data gathering and storage to be retrieved when needed for a variety of purposes such as cross checks and extrapolation studies. Consumer demographic also involves age and lifecycle studies (Wood, 2005). Demographic segmentation has also some far reaching consequences for the whole marketing campaign of the average company. While very few strategies might be adopted by a company in demographically segmented markets, the outcomes related to the whole marketing process would be diverse and complicated for the sole reason that the lifecycle centric approach demands tracking the customer’s changing needs and accordingly mapping the future requirements. 5) Commercial Practice and the Supply Chain Baby Care Product Company has been experiencing some success as a manufacturer of baby personal care products during the last few years. It’s the world’s leading baby care product company compared to Procter & Gamble and Johnson & Johnson. Though, right now its decision is to enter to the new market to achieve rapid growth in baby care selling in both globally and its own competitive environment in the UK. Further its operation within the country is determined by a number of endogenous and exogenous variables such as the socio-economic factors and competitors’ strategy. Within the competitive environment Baby Product Company has successfully initiated a strategy of niche marketing and sales targeting against the ever hardening competitive pressures. Its partial success story has been defined and underlined by its desire to capture and retain niche market segments on the strength of product diversification and quality management. This effort is reinforced by its internal strengths such as labor force motivation, sound financial management, supply chain management, internal value chain management and good husbanding of critical success factors outlined above. Baby Product Company’s strategic production, marketing and quality management initiatives have had a directional thrust in achieving both corporate and strategic functional goals (Webster, 2008). These positive outcomes have enabled the management of the company to partially or wholly overcome some of the negative external environmental influences arising from the strategic competitive environment. Especially the pricing factor has had a negative impact on its competitive edge due to some rivals’ ability to reduce prices despite rising costs. 6) Statistical Evidence. With the current economic downturn consumers have been very choosy about the prices they pay for baby care products. Especially consumers anywhere in the world have a tendency to buy baby care products that promote ease and safety of the baby care activities. According to available statistics the market for baby personal care in the UK has been increased from 2001 to 2006 with a growing average annual rate of 1.9%. Similarly customer response can be evaluated by focusing on customers habits of making a purchase on a regular basis and making regular visits to the same store. However the company must employ well trained staff to make these assessments. The existing conceptual frameworks are full of shortcomings and more often they lack a system of proper metrics. Metrics are mostly useful in defining learning outcomes of a study with a degree of great accuracy (Rayburn, 1986). They also help in building up a comprehensive set of norms for the testing of convergent and divergent behavioral patterns of variables. Though the existing statistical measures are used to measure gathered data and make predictions, metrics on behavioral tendencies of variables associated with sensory marketing need to be refined to achieve a considerable degree of conformance with learning outcomes. For example metrics on averages and marginals arising from the impact of sensory marketing efforts could help the researcher to attribute success or failure of such efforts. These must be expressed as ratios and not simple averages, means, mediums and variances. Such ratios cannot be developed without a proper conceptual and theoretical framework of reference. Finally it can be draws some strategies for Baby Product Company to follow to enter to the new market. Baby Product Company’s entry into the UK South Western England market as a retailer requires a high pitched sales campaign backed by both good primary and secondary research. It must be supported by TSL outcomes. It needs to be marketed by adopting a market penetration strategy. This means the introductory price must be kept to a minimum so that a sizable share of the baby product market can be captured and maintained. The UK market segment requires a diversified marketing strategy based on targeting a mass market and a number of niche markets. The latter are characterized by customer preference and sentiments. REFERENCES 1. Cook, GR 2007, ‘Marketing to Leading Edge Baby Boomers: Perceptions, Principles, Practices, Predictions’, Journal of Consumer Marketing, vol24, no.7, pp.447-449. 2. Hoffman, KD 2005, Marketing Principles and Best Practices, South-Western College Publications, London. 3. Rayburn , LG 1986, ‘Accounting Principles and Marketing Models Related to Deferred Marketing Costs’, European Journal of Marketing, vol.20, no.1, pp. 75-82. 4. Webster, S 2008, Principals and Tools for supply chain management, McGraw-Hill-Irwin, Boston. 5. Wood, MB 2005, Marketing Planning: Principles into Practice, Financial Times Management, England. 6. Wright, LT 2004, ‘Qualitative market research: principles and practice’, International Journal of Market Research, Retrieved from www.accessmylibrary.com. Read More