Marketing Plan of LUX for Successful Market Entry - Essay Example

Marketing Plan for Successful Market Entry Executive Summary This report throws light on a marketing plan for LUX. With the help of the plan, LUX would be able to ideate prolific strategies by virtue of which the company would be able to productively launch its existing products in new markets or launch new products in existing markets. The plan will justify the most competitive strategic options that can be adopted by the company in business. The plan will also frame ways through which the company would be able to utilize its marketing mix strategies in the most proficient manner. Finally, the plan will provide certain recommendations, which will help in addressing limitations that the organization would be facing while implementing strategies. Since demand for beauty soaps has augmented in the global context and LUX enjoys high reputation in producing beauty soaps, the essay will give evidences to stress on the fact that most competitive strategy of the firm is to launch a new anti-acne whitening soap in the existing markets. Contents Contents 3 Main Findings 4 Justification of Competitive Strategic Option 4 Employing Elements of Marketing Mix 6 Conclusions 8 Recommendations 8 Timeline Activities 9 Reference List 10 Bibliography 11 Appendix 12 Introduction LUX is a company that has primarily engaged in production of beauty soaps since its inception in 1899. Though the company operates in almost all nations of the world, yet from its marketing audit, it is found that products of the company are at the declining stage of product life cycle. So, if the company desires to succeed in the long run, it must introduce appropriate marketing strategies in business. With the help of an appropriate marketing plan, the company would gain a clear idea about key marketing elements to be considered in its business and hence, be able to focus on desired business progressive objectives. The current report focuses on a marketing plan for the company. This plan would allow the company to frame productive strategies by virtue of which it would be able to successfully launch products in new markets and also improve quality of products in the existing markets. The marketing plan of the company would be a broader perspective than it simple business plan. Moreover, this will also help the firm to comprehend problems associated with its existing marketing mix strategies. At this juncture, where giant multinational companies like, ITC and Palmolive, are competing with LUX on the global forum, role of a marketing plan for the company is indispensable. With the help of a marketing plan, LUX in the long run would become a profitable member in the business world. The aggregate revenues and brand awareness of the company would eventually increase. With the help of the plan, LUX would be able to effectively achieve its business mission (Kapferer, 2012). Main Findings Justification of Competitive Strategic Option From the context of SWOT analysis in the marketing audit, three growth opportunities for the firm were framed. The first option stated that the company must try to expand the base of customers for its anti-acne and whitening soaps. The second option claimed that the company must try to frame ways through which it can increase sales of products for older men and women. Finally, the third option stated that the company should launch a completely new body wash that would comprise special sun screen and whitening features (Unilever, 2014). However, from context of the audit, it is found that the company has decided to focus on its first growth opportunity in business. This is because marketing mix plan of the firm is entirely based on its anti-acne and whining soap products. The marketing planner believed that growth strategy adopted by the firm is a competitive strategy. This is because; the second and third options are not feasible for the firm. It is not possible for the firm to expand its business among older generations efficiently as old men and women who are already non-potential buyers of the firm would not change their purchase decisions at a matured stage of life. In addition, the company expertises in producing beauty products and old people are less attracted to such range of commodities. Beauty products are more popular among the youth and middle aged individuals (Raaij and Verhallen, 1994). This justifies rejection of the second opportunity stated in the SWOT analysis. Moreover, if the company decides to introduce a completely new product like, body wash, then it would require a large pool of finances (Peng, 2008). It would be take long time for the firm to popularize its new product in the industry, where giant competitors like, Palmolive and ICT, are proficient producers of body wash. These rivals of the firm take away a large proportion of its market demand in the industry. Hence, launching a completely new product line in existing market would be time consuming and expensive for LUX (Unilever, 2014). The best option for the company would be to frame marketing mix strategies in ways through which it would be able to multiply its revenue from existing success factors. As stated in the marketing audit, this strategy can be adopted by the firm by launching a new anti-acne whitening soap in the market. In addition, the beauty industry is booming worldwide and with the help of effective marketing strategies, the company would be able to reap adequate economic returns from this industry. It is forecasted that the beauty industry’s aggregate demand in 2014 would rise by 8.5% (Łopaciuk and Łoboda, 2013). Over time, per capita income levels of the individuals across all nations have improved. With rise in earnings, discretionary spending of consumers has also expanded. Therefore, the aggregate demand for beauty soaps and perfumes has also increased. Furthermore, since 2009, the global economy has been experiencing recessionary trails. This has lowered the supply of money across rich nations like, U.S. and U.K. Some researchers claim that modern consumers are becoming more price conscious than before. Since anti-acne and whitening products of LUX are less pricy than its competitors like, Pears and Golden Pearl, it is likely that price conscious consumers would prefer purchasing more of LUX beauty products. It should also be noted that beauty soaps of LUX fall in the category of Cosmetics and Toiletries product industry, which has a stable growth and also resist the unfavourable economic conditions. It can be observed from table 1 in the Appendix that market demand for skincare products has augmented from 16.4% (in 1998) to 23% (in 2010) (Łopaciuk and Łoboda, 2013). Since demand for beauty soaps has increased in the global context and LUX enjoys highest popularity for its anti-acne and whitening beauty soaps, most competitive strategy of the firm would be to establish a new anti-acne whitening soap in its existing markets. Employing Elements of Marketing Mix The marketing mix of the company was based on 4P analysis of the anti-acne whiting soap. The following context of the marketing plan would provide realistic ways, whereby LUX would be able to effectively implement its marketing mix strategies. Product The company must try to convey to all potential customers that this anti-acne whitening soap is greatly different from its existing soaps. The company must convince them that this soap is competent enough to become an international product in the industry. In addition, the firm should make its customers believe that the new soap (that would be sold under the brand name of Unilever) is enriched with natural and scientific ingredients, which can help to better and nourish the skin of users. The sellers of the product must communicate about its intrinsic worth to customers. Consumers in the contemporary world are highly health conscious and such claims would help to secure a wide range of buyers for the firm (EURIB, 2009). Price The company can implement the strategy of premium pricing for its new soap. So, by following this strategy, the company would sell its soap at a higher price relative to that of other soaps. The sellers of the product must make customers believe that high price of the soap primarily owes to its superior quality as well as ability to cater to germ protection, skin whitening and beauty requirements. The economic theory of Veblen Effect claims that consumers often judge quality of a product according to its price. Hence, by making the soap slightly more expensive, the company would be able to convey that this product is rich in terms of quality (Atikian, 2013). Place Since the company’s target customers belong to middle and upper middle income class, this soap of the company must be available in all big departmental stores and small retail outlets across the markets. As housewives are also estimated as productive buyers of products of the company, it should be noted that by appointing door-to-door sellers, the company can gather a substantial amount of market demand. A team of efficient workers can be appointed by the firm who would attentively check productivities and efficiencies of existing wholesalers and retailers of the company. Moreover, since the product experiences a global brand image, the company should try to expand the distributional network in other economies. It can be observed from table 2 in the Appendix that majority of beauty products sales are undertaken through Non-Store Retailing methods (Atikian, 2013). Such methods include procedures like, direct sales and that over internet media. So, the company should assure that its direct sellers are highly efficient and acquire the correct knowhow regarding the product and its pricing strategies. The internet selling sites of the company should be attractive as over time, proportion of e-shoppers has significantly increased in the market. This would enable the company to capture a wide base of customers through this mode of sales (Georgi and Mink, 2012). Promotion Internet media is considered to be the best promotional media for the company’s product in its existing market, following newspapers. It should be noted that in Pakistan, circulation of newspaper is high in both rural and urban areas. Hence, advertisements of product of the company in newspapers can help to create high brand awareness. After newspapers, the second best mode through which product promotion can be initiated is internet social networking sites (Trainor, et al., 2013). As stated above, proportion of social networking site usage has increased in Pakistan and promoting the soap through social networks would help the firm attract large number of buyers. In addition, certain promotional expenses should be allotted for free sampling to universities and school students. The purchasing decisions of households often depend on decisions made by the children within it and free sampling to students would be an effective method of promotion (Atikian, 2013). Conclusions In the contemporary world, degree of competition among consumer goods producing firms has substantially intensified. From the above context, it can be claimed that LUX can successfully sustain its position in the industry with the essence of a good marketing plan. The essay claims that in order to achieve its mission in business, the company should introduce a new anti-acne whiting soap in existing market. However, it should be noted that marketers of the product must be aware about its intrinsic worth. The product would be sold at a premium price to justify that its high quality. Non-store retailing would be the primary mode through which this new product would be sold across its existing markets. The promotional activities would be carried out through newspaper advertisements and social media commercials. With this competitive brand extension strategy, LUX would be able to generate higher economic surplus in the long run (Johnson, n.d.). Recommendations The company might face certain problems while marketing the anti-acne whitening soap. The company might incur high costs in producing the product in initial stages. Certain price conscious customers might not be interested in purchasing the new soap at a premium price. Potential rivals might sell similar products in the market by imitating qualities and features of the new soap of LUX. Inefficient work of retailers and marketers might make the product less popular in the industry compared to targets assumed (Henry, 2008). Even so, such problems can be easily eradicated by employing specific measures. If the company decides to sell its new product in new markets, then it can experience a higher demand and economies of scale in production. This would help the firm lower the product’s average cost. If the retailers and marketers of the product are well-trained and motivated at work, then they can prove to be highly beneficial in generating greater sales. Though effective product campaigning sessions, these efficient individuals can make consumers believe that high price of the product is due to superior quality. Unique product designing and packaging process can help the company differentiate its new soap from other similar products in the market (Walsh, et al., 2010). Timeline Activities Strategy Key Initiative 2013 To launch LUC Anti Acne Whitening Soap in Existing Markets Q1 Q2 Q3 Q4 Jan. Feb. March April May June July August Sep. Oct. Nov. Dec. Product Price Place Promotion Reference List Atikian, J., 2013. Industrial shift: The structure of the new world economy. Basingstoke: Palgrave Macmillan. EURIB, 2009. Kapferer’s brand-identity prism model. [pdf] EURIB. Available at [Accessed 25 March 2014]. Georgi, D. and Mink, M., 2012. The quality of electronic customer-to-customer interaction. Journal of Retailing and Consumer Services, 20, pp. 11–19. Henry, A., 2008.Understanding strategic management. Oxford: Oxford University Press. Johnson, C., n.d. The growth of multichannel retailing. [pdf] TRAC. Available at [Accessed 25 March 2014]. Kapferer, J. N., 2012. The new strategic brand management: advanced insights and strategic thinking. Delhi: Kogan Page Publishers. Łopaciuk, A. and Łoboda, M., 2013. Global beauty industry trends in the 21st century. [pdf] To Know Press. Available at: [Accessed 25 March 2014]. Peng, M. W., 2008. Global strategy. Connecticut: Cengage Learning. Raaij, W. F. V. and Verhallen, T. M. M., 1994. Domain-specific market segmentation. European Journal of Marketing, 28(10), pp 49-66. Trainor, K. J. James, M. A., Rapp, A. and Agnihotri, R., 2013. Social media technology usage and customer relationship performance: A capabilities-based examination of social CRM. Journal of Business Research, 30, pp. 1-8. Unilever, 2014. LUX. [online] Available at: [Accessed 25 March 2014]. Walsh, G., Thurau, T. H., Sassenberg, K. and Bornemann, D., 2010. Does relationship quality mattering-services? A comparison of online and offline retailing. Journal of Retailing and Consumer Services, 17, pp. 130–142. Bibliography Jussila, J. J., Kärkkäinen, H. and Immonen, H. A., 2013. Social media utilization in business-to-business relationships of technology industry firms. Computers in Human Behaviours, pp. 2-8. Kim, A. J. and Ko, E., 2012. Do social media marketing activities enhance customer equity? An empirical study of luxury fashion brand. Journal of Business Research, 65, pp. 1480-1486. McLeish, B. J., 2010. Successful marketing strategies for non-profit organizations: winning in the age of the elusive donor. New Jersey: John Wiley & Sons. Müller, A. K., 2005. Swot-analysis for Henkel’s loctite. Munich: GRIN Verlag. Newmark, J. H., 2009. Automobile business. Cambridge: Cambridge Scholars Publishing. Rogers, S. C., 2001. Marketing strategies, tactics, and techniques: a handbook for practitioners. Connecticut: Greenwood Publishing Group. Sultan, A. L., 2011, The Impact of Customer Relationship Marketing in the Luxury Retail Market of Kuwait: A Thematic Analysis. [online] Available at: [Accessed 25 March 2013]. Vezzoli, C. and Manzini, E., 2008. Design for environmental sustainability. New York: Springer. Webster, F. E., 1995. Industrial marketing strategy. New Jersey: John Wiley & Sons. Westwood, J., 2005. The marketing plan workbook. Delhi: Kogan Page Publishers. Appendix Figure 1: Growing Market Demand for Skincare Products (Source: Łopaciuk and Łoboda, 2013) Figure 2: Tends in Beauty Product Distribution Channels (Source: Łopaciuk and Łoboda, 2013) Read More