Marketing Concepts of Virgin Atlantic - Essay Example

Part A: Marketing Concepts of Virgin Atlantic: The organization that is of interest to me is VirginAtlantic, a British airline company. Virgin Atlantic has always developed its marketing strategies through focusing on the philosophies of marketing concepts and new-era orientation. Virgin Atlantic has developed a marketing strategy aimed at retaining its customers and identifying their needs, through its virtual Flying Club program. Customers can access this program, through the websites of Virgin Atlantic, and it helps in creating an environment of mutual benefit between the customers and the company (Crane, 2010). This program is interactive in nature, and the company is able to collect any information that can help it to improve on their services for purposes of satisfying the various needs of its customers. Customers of the organization can also use the company’s website to book for airline tickets, check for any information concerning their flights, and also interact with the strategic partners of Virgin Atlantic, such as the Alamo car hire firm. The airline company has also introduced the technological mobile App that makes it possible for the customers of the organization to track and check on any information that pertain to their travelling (Crane, 2010). Through these marketing strategies, the airline company has made travelling to be fun, simple, and convenient. They have also helped to create a relationship between the company, and its customers. This is one of the philosophies contained in new-era orientation, and marketing concept. It is important to denote that the value that the airline company has created for its customers is the ability of its customers to travel in comfort, while also having fun. The airline company has managed to create this value, through the use of effective communication, between the company, and its target customers. The channels of communication occur through the company’s website, which is interactive in nature. One of the ethical issues facing the company is the conservation of the environment, through reduction of green house gases. It is important to understand that the airline company contributes to a great extent on the emission of carbon green house gases. This in turn contributes to a great extent on the concept of global warming, and climatic change. The management of Virgin Atlantic realizes this issue, and they have invested heavily on research, for purposes of finding alternative fuels, that can help the company to reduce the emission of these gases. A social issue that the company faces is its desire to cut on costs by retrenching its employees. The losses the company faced were brought forth by increased competition along their Trans Atlantic route, and increased fuel costs. Retrenching of employees is a social issue because it will affect the quality of life of these employees. To solve on this issue, the organization intends to look at other ways of cutting on costs, and this includes closing some routes, and failing to provide for pay increases. To be more ethically and socially responsible, the company should also partner with their surrounding community for purposes of collecting information on how it should conduct its operations. Part B: This section is a SWOT analysis, on Mega Blok’s, and it is based on its external and internal environment and their implications on its marketing mix. SWOT Analysis: Internal Environment: a. Strengths: The company produces a variety of toy products such as puzzles, building blocks, colors, etc. To take advantage of this strength, the company needs to aggressively advertise its products by providing information on the quality of the product. The company has a license to create popular childhood toys such as power rangers, and Barbie (Baker and Tourangeau, 2002). This will enable the company to sale these products to existing and emerging markets all over the world. The company has a very strong research and development department, whose responsibility is to carry out a market research. This will help the company to develop good products that will carter for the needs of its customers. The company has a large market, operating in more than 100 countries. b. Weaknesses: Litigations and laws suits that the company suffered affected its brand name. To improve on the image of the company, there is a need of creating a public relations department for purposes of communicating the strategies and activities of the company, and removing any misconception about the company. The company is vulnerable to the concept of liquidity crunch, and this is because of the global market in which the company operates. To address this weakness, the company needs to invest in markets that have a stable economy. External Environment: a. Threats: The company operates in a highly competitive environment, and this competition emanates from companies such as flying crayons, and Lego. On this basis, there is a need of the company to produce high quality products, and a cheaper price. There is a growth in the counterfeit products of the company, and more so, from Chinese companies. To address this threat, the company needs to improve on the quality of its product, by using differentiation strategies in order to create unique products that cannot be imitated. The company operates in the international market, which is threatened by unstable currencies (Baker and Tourangeau, 2002). To address this threat, the company needs to invest in markets which have a stable economy. There is a danger of political instability in the markets in which the company operates. To address this thereat, the company needs to invest in countries that have a stable political system. b. Opportunities: Positive playing patterns amongst children. To take advantage of this opportunity, the company ought to engage in aggressive advertisement strategy. Emergence of new technologies, especially in the marketing arena, such as the use of the social media. To take advantage of this opportunity, the company ought to initiate new online services such as purchasing products of the company through the internet, as well as extensive use of the internet to advertise and promote its products. Important Internal Environment factors: The following are the most important internal environmental factors, namely, Research and Development, the organizations market, litigations and lawsuits, and the company’s products (Baker and Tourangeau, 2002). Research and development is important because it is the backbone of the company, and it helps in identifying the needs of customers. Products are important, because their quality determines whether the company will make sales or not. Litigations and lawsuits affect the brand name of the company, and hence they have to be avoided. The market represents where the organization sales its products, and to whom. This is the core for the existence of the company. Part C: Segmentation Approach: The Canadian automobile industry is characterized by the existence of automobile assembly plants, belonging to foreign companies (Ignjatovic, 2013). For effective marketing of automobile vehicles and parts, there is a need of using the concept of market segmentation to identify the various target markets of the vehicles under consideration (Crane, 2010). An approach to use in carrying out the segmentation of market is the use of a concept referred to as lifestyle segmentation. Lifestyle segmentation involves the degree upon which the target customers identify themselves (Dibb, 2012). There are four major segments under lifestyle segmentation are (Kotler and Armstrong, 2012; Ignjatovic, 2013); The Rich Upper Middle Class. Lower Middle Class Skilled Working class. Profile of the Segments: The Rich: i. Who they are: This is an individual who owns factors of production, such as companies, successful business organizations, etc. They can also be prominent sports personalities. ii. What they want and reasons They are attracted to expensive and luxurious cars. They buy these luxurious cars because they symbolize their higher social status. iii. When they buy and use it These people usually buy these cars, any time a new model comes into the market, and they normally use it for social purposes. iv. Where they buy, and use it They normally buy these products from reputable auto dealers. v. How they buy and use it In deciding to buy these products, they are always influenced by the numerous advertisements that occur concerning the product. This decision to purchase this products is always emotional They do not constantly use these products, and they can only use it on specific occasions. vi. The Segment Size. This segment consists of less than 5% of the Canadian population. Upper Middle Class: i. Who they are: This are top managers in very successful business organizations and the possess University degrees from top university institutions. They are attracted to quality products, and are always willing to spend their money on products that satisfy their needs. ii. What they want and reasons They value class and luxurious products. They would like to use these cars for business purposes. iii. When they buy and use it These people normally buy these products in a bid to maintain their social status. They do not frequently buy these products, and it can be once in a lifetime. iv. Where they buy, and use it These people normally buy these products soon after they attain prominent positions within the society, or within their work place. They buy these products from reputable auto dealers. v. How they buy and use it These people are always influenced by their friends and professionals in buying these products. They are also influenced by advertisements from the social media, and other channels of communication. Their decision to purchase these products is always cognitive, and based on reason. vi. Segment Size This market consists of less than 10% of the Canadian population. Lower Middle Class: i. Who they are: These are middle level managers, and administrators in companies and business organizations. ii. What they want and reasons They are also attracted to quality products, but those that are affordable. In as much as they value class, they will only buy products that are of necessity, and satisfy their needs. iii. When they buy and use it They buy it for purposes of helping them maintain their status, and for ease of movement. They buy it when they get money, and it can be once in a life time. iv. Where they buy, and use it They buy these products from reputable auto dealers. They use it for personal and business purposes. v. How they buy and use it They are normally influenced by friends into buying the products. Their decision to purchase this product is always based on cognitive factors and reason. vi. Segment Size: This population forms a larger percentage of the Canadian Market, and it is more than 40%. Ideas on how the marketing mix strategy will be different for each of these profiles: The marketing mix strategy of these three segments will differ to a great extent, and this is because of the various needs and desires of the people belonging to these marketing segments. For instance, amongst the wealthy and the rich, the organization will have to develop high quality and luxury and specialty cars, for the main purpose of selling to the rich. The prices of these products will also be high (Dibb, 2012). Amongst the upper middle class, the price of the vehicles under consideration will be lower, as compared to the prices of the vehicles that target the rich. The type of car brands that these people normally buy luxurious cars and most of them cannot afford specialty cars, which are always very expensive. The lower middle class on the other hand cannot afford expensive cars, and on this basis, there is a need of introducing cheap cars to suit their needs (Ignjatovic, 2013). On this basis, the different marketing mix strategies will focus on the price, and the quality of the car. Market Segmentation for Honda Civic: The people that are most likely to buy Honda Civic are the lower middle class. This car is cheaper as compared to other models of vehicles, which includes luxurious cars such as BMW, and Mercedes Benz. It also does not consume a lot of fuel, with a fuel efficiency of 14.8kmpl (Ignjatovic, 2013). This car is also of high quality, consisting of a number of protective features, which includes a G-Force technology which is a feature aimed at protecting the passengers against any collision. Other safety features that this vehicle has include electronic brakes, and anti-locking brake system. On this basis, this is a car that satisfies the needs of the lower middle class, particularly because it is affordable, which retails at an average price of 15,000 us dollars (Ignjatovic, 2013). This segment is more attractive to this class, because the wealthy and the upper middle class will always want luxurious vehicles, which are expensive, and consume a lot of fuel. Three Car Brands for the Upper Middle Class: The brands that appeal to this market segment are (Ignjatovic, 2013), Mercedes Benz BMW Chrysler These brands uniquely appeal to this group, because they are luxurious vehicles, which also symbolize an aspect of class. These vehicles are also very expensive, and are out of reach of the lower middle class. These vehicles are also of very high quality, and they are built with high quality materials and resources aimed at giving them an elegant touch and design. On this basis, these vehicles normally symbolize elegance and prestige (Ignjatovic, 2013). This makes them attractive to the upper middle class. On this basis, these automobiles differ with brands competing with other segments, based on their pricing, quality, and ability to symbolize elegance. For instance automobiles found amongst the wealthy, are always very expensive, as compared to these cars (Ignjatovic, 2013). Whereas automobiles found amongst the lower middle class, are cheaper as compared to these cars. Position Maps: Position Map (a) High Quality Mercedes Honda Civic Chrysler BMW Low price High price Low quality Position Map (b) The Wealthy BMW Chrysler Mercedes L. Middle Class U. Middle Class Honda Civic Skilled Workers References: Baker, P. A., & Tourangeau, F. (2002). Mega Bloks Inc.: building blocks for growth. Toronto: Merrill Lynch. Crane, F. G. (2010). Marketing for entrepreneurs: concepts and applications for new ventures. Thousand Oaks, Calif.: Sage Publications. Dibb, S. (2012). Marketing concepts and strategies (6th ed.). Andover: Cengage Learning. Ignjatovic, D. (2013). Canadian auto manufacturing running again, but how much fuel is left in the tank?. Toronto, Ont.: TD Economics. Kotler, P., & Armstrong, G. (2012). Principles of marketing (14th ed.). Boston: Pearson Prentice Hall. Read More