Marketing Strategies for a Smart Pen Developed by Qatar Deja VU - Essay Example

Company/brand s of the group members and their IDs Contents Introduction about the Company and MissionStatement 3 2. Marketing Research 4 3. External Environment Analysis 5 4. SWOT Analysis 9 5. Segmentation, Targeting and Positioning 11 6. Marketing Mix (4 P’s) 16 7. Ethical Dilemma 20 References 22 Marketing Plan - Smart Pen This report embodies a marketing plan for a smart pen developed by Qatar Deja Vu. The report includes a comprehensive discussion about the market research and marketing strategies to be deployed by the company so as to introduce the product and attract the target customers. The first section provides an introduction about the company and its mission statement. The second section provides a detailed discussion about the marketing research and information sources used in this report. The third section includes the analysis of external environment of Qatar, which comprise of CREST analysis. The fourth section comprises of SWOT analysis of the business and product being offered. Fifth section provides a detailed discussion about segmentation, targeting and promotion strategy of the company. Sixth section provides a detailed marketing mix for the product, and the last section discusses the ethical dilemma of the product. 1. Introduction about the Company and Mission Statement The company, Qatar Deja Vu, is a newly established Qatari based company which is focusing on providing state of the art electronic products with smart and amazing use of technology. However, during this short history of 15 years, the company aims at learning and adjusting itself in line with the social and cultural values of the country, while ensuring that technological advancements run smoothly. Qatar Deja Vu will operate in the consumer electronic industry in Qatar and deal in the manufacturing of smart devices which are specifically made for young generation. The upcoming product of the company is named as “Smart Pen”, which is also being developed for people falling in the young age group. The mission statement of the company is as follows: To enhance the abilities and skills of Qatari youth by equipping them with technology, which is smart and exhaustive. This mission statement is a depiction of the comprehensive vision and long term strategy being followed by the company. As the company aims at targeting young generation, therefore the element of youth is everywhere in its vision, strategies and products. The plan to introduce a Smart Pen in Qatari market is also a part of its long-term strategy to remain committed to serve the Qatari youth with innovative products. 2. Marketing Research The marketing research carried out and presented in this report has been based on information collected through secondary sources of information. In fact, there has been no primary information source or research instrument has been used in the research. The major sources of secondary information, used in this report, have come from online sources, such as websites, market reports, analysts’ opinions and forecasts, news, journals, books, magazines, etc. All information obtained from these secondary sources has been cited wherever it has been used in the report. The information collected through these sources has been put to different uses. As for instance, understanding the external environment in which the business operates has been crucial to formulate a strategy, which is not only effective to implement the plans of the business, but is also able to ensure existence and smooth operability of the business. Therefore, the CREST model has been in this regard to understand the Social, Economic, Technological, Competitive and Rules and Regulations factors, which can influence the business of the company and the new product, which is about to be launched in the market. Apart from this, the information obtained from secondary sources has also been used to carry out a SWOT analysis for the business, which enables the identification of strengths, weaknesses, opportunities and threats faced by the business. This analysis has provided necessary insights about the internal environment of the company in light of market conditions. In addition to the SWOT analysis, an STP analysis, which includes segmentation, targeting and positioning, has been carried out. The STP analysis is an analysis based on three stages, which enable evaluation of different segments which can be considered in the marketing plan, targeting of the product, and positioning of the product. In this regard also, only secondary information has been used to understand what segments can be targeted by the company to market its product in Qatar, how targeting of customers can be carried out in line with the existing marketing conditions and the nature of the product itself. Lastly, the analysis also enables understanding how the product can be positioned in the market. Apart from the STP analysis, another important model used for carrying out marketing research and developing the marketing strategy for “Smart Pen” is the 4 P’s of Marketing Mix, which include developing the strategy for Product, Price, Placement and Promotion. The information obtained from secondary sources, which include market reports, news and developments related to Qatar’s consumer electronic industry, etc. has been used to determine what are the features of the product, what price level is suitable to be set for the product when launched in the market, where the product has to be placed and what promotion strategies will be adopted to market it. Thus, all the information used in the research has been obtained from secondary sources of information and no primary research instrument has been used. 3. External Environment Analysis For the purpose of evaluating the external environment in Qatar and determining the marketing strategy which is appropriate in the circumstances, CREST model has been used. The CREST model includes an evaluation of external factors, such as Social, Economic, Technological, Competitive and Rules and Regulations factors, which may influence the operations of the company and the product it plans to launch. CREST Analysis Each of the factor included in CREST model has been discussed separately as follows: Competitiveness Qatar has an open economic policy, which has allowed businesses to make their entry into its market by making direct investments in various sectors. This has increased the competitiveness of the country as companies operating in the country compete not only with each other, but also on the global level (Thottathil, 2013). The competitiveness of the country has direct implications for the proposed business. As other businesses can also sell their smart pens in Qatar through local distributors or online stores. Although, there is no competition from the local businesses, but international companies which are working on smart pen technology can generate competition for the company. These products are available in Qatar through online shops. Some of the direct competitors include Livescribe, Equil JOT, Toshiba, and Huion that are manufacturing and selling smart pens. Like any other technology-based product smart pen are easily available and competition between manufacturers is intense as they continue to develop new designs and improve their technology. All these factors affect the new business and a competitive strategy in terms of innovation and pricing has to be adopted. Rules and Regulations The business environment allows innovative ideas to generate and get accepted by customers. The government of Qatar has undertaken a major transformation in its stance and introduced reform-based policies that are aimed at making the country one of the most vibrant economies at the international level (Ibrahim & Harrigan, 2012). In the recent years, Qatar has allowed IT and technology based businesses to thrive. ICTQatar has assisted new and existing businesses to nurture innovation. Smart pen require several components and technologies, which are not available in Qatar and, therefore, they have to be imported. Qatar has no restrictions placed on the import of these necessary components. Economic Factors Qatar has emerged as one of the vibrant economies in the Middle East. The country offers great opportunities for technology-based companies (Ibrahim & Harrigan, 2012). In the recent years, the country has recorded strong growth in its GDP and the average income of individuals has also improved. People opt for new technologies at all price levels and, therefore, the new business can benefit from improvement in the economic and financial conditions of the general population. Social Factors In the recent years, the country has pursued a policy referred to as “Qatarization” that is aimed at employing resources locally. The government is motivating local Arab residents to get education and hold positions in companies (Ibrahim & Harrigan, 2012). With more literacy in the country, people residing in the country have become aware of new technologies and products that could be used in their daily lives. Mada, which is an assistive technology center in Qatar, has been making efforts to increase the awareness of people regarding assistive technologies available in Qatar (Mada, 2012). The level of understanding of people living in Qatar about the use of assistive technologies is increasing which can help the company to introduce smart pen in Qatar. Effective communication strategy by the company can yield quick results for the company. Technological Factors The IT industry of Qatar has experience significant growth in the last few years and it is further expected to enjoy high level of growth (Minister of Business and Trade, 2010). The support factors related to the IT and technology driven industries in Qatar are attracting new businesses. These factors have positive implications for the proposed business that aims to introduce its smart pens. Easy access and availability of technology and support services will assist the company in developing, launching and improving its products. 4. SWOT Analysis This section of the report provides a comprehensive SWOT analysis of Qatar Deja Vu based on secondary information obtained from different sources. The analysis includes discussion about the strengths, weaknesses, opportunities and threats for Qatar Deja Vu with respect to its plan to launch “Smart Pen” in the consumer electronics market of Qatar. The strengths, weaknesses, threats and opportunities are listed as follows: Strengths The concept of introducing a pen with such features and technology is still a new one in Qatar’ consumer electronic industry, and therefore Qatar Deja Vu will have the advantage of being the first mover. Moreover, the company has a highly qualified human resource, which will be useful in the development of the product and therefore will enable the company to remain self-sufficient in the production of the product. Weaknesses As far as weaknesses of the product are concerned, it is pertinent to mention here that the company is a new business entity and has therefore a number of new areas to explore and manage issues while operating in Qatar. Although the company has a team of highly professional employees, but at the same time their lack of experience and less exposure to such working environment may serve as a weakness for the overall business. Opportunities Moreover, the fact that Qatar has one of the highest per capita GDP in the world, it therefore presents an opportunity for the company to go for premium pricing from the start. This will enable developing perceptions among consumers about the image of the product and will give it a distinct position in the market. Secondly, young consumers in Qatar have the necessary awareness of benefits associated with technology driven products. Therefore, the company can use this awareness as its strengths to introduce the product to them more easily. Apart from this, there are not many competitors existing in the consumer electronics segment at present, which will definitely be helpful for the company to establish the product and make further progress for doing away possible threats from new entrants. Threats The foremost threat for Qatar Deja Vu is that any new innovative technology run product carrying similar or even better features than the Smart Pen can result in a drastic decline in the demand and market position of Smart Pen. Moreover, it is not difficult to manufacture such a recording device and present it in the form of pen or any other handheld object, therefore, any new entrant can manufacture similar product(s) and become a direct competitor of the company. Apart from this, there is also a threat that objections may be raised regarding the ethical aspects of using the product, as it may be misused by the consumers and compromise privacy of others. Moreover, as per the estimated figures in July 2013, out of the total population of Qatar, which was 2,042,444, only 13.9 percent of individuals fall in the age bracket of 15 to 24 years, which include 208,625 males and 74,881 females (Index Mundi, 2014). This implies that the target population is low and therefore the company cannot expect significantly higher revenues. 5. Segmentation, Targeting and Positioning In this section of the report, the target segment for the product, targeting strategy and positioning of the product has been discussed in detail. Segmentation As mentioned earlier in the mission statement of the company, the segment, which is being targeted by Qatar Deja Vu, is the young consumers of electronic goods in Qatar. Although young population is a specific segment of the overall population of Qatar, but segmentation can still be done in this regard. As for instance, the company will be targeting consumers aged between 15 to 35 years and individuals above 35 years age. The first age group will be classified on the basis of the educational level of students into three subgroups. On the other hand, the second group refers to professionals and other potential users of the pen, apart from students. On the basis of this classification, following segmentation of the target population has been carried out: Basis of Segmentation Segmentation of Users Consumers between 15 to 35 years Youngsters aged between 15 years and 18 years High School and College Students Youngsters aged between 19 years and 24 years University Students (Undergraduate) Youngsters aged between 24 years and 35 years University Students (Graduate) Consumers above 35 years Professionals The above-presented segmentation is based on the demographics (age) of consumers, through which two main segments have been identified. Apart from this, another possible option was segmentation on the basis of gender, but keeping in view the use and features of the product on offer, no particular segmentation can be done on the basis of gender. However, one possible way of doing further segmentation is on the basis of needs of consumer while keeping in view the uses of Smart Pen. Keeping in view the features of smart pen, it can be stated that students as well as professionals can put it to various uses. The segmentation on the basis of different uses of the pen has been presented as follows: Basis of Segmentation Segmentation of Users Need of Consumers Education Use Personal Use Professional Use As a result of this segmentation, following diagram summarizes the segments in the consumer electronics market in Qatar, which can be targeted by Qatar Deja Vu for marketing its Smart Pen: The profiling of each segment identified on the basis of age groups can be carried out as follows: Segmentation of Users Profile High School and College Students High school students can use the product in their regular academic sessions. They will find it helpful as it will enable them recording class discussions, etc. University Students (Undergraduate) Undergraduate students can use the product in their regular academic sessions. They will find it helpful as it will enable them recording class discussions, lectures, meetings, team projects, research, etc. University Students (Graduate) Graduate students can use the product in their regular academic sessions. They will find it helpful as it will enable them recording class discussions, lectures, meetings, team projects, research, etc. Professionals Professionals will be able to use the smart pen The profiling of each segment identified on the basis of needs of users can be carried out as follows: Segmentation of Users Profile Education Use Students, including high school and university students are included in this profile. These students can use the product to effectively carry out their academic tasks while saving time. Personal Use Youngsters of any age group and people aged above 25 years fall in this profile. These consumers can use the product for their personal use, such as recording audio and video any time anywhere. Other Use Other uses of the product can be in offices and organizational setups. Targeting As mentioned earlier, the major target segment for Smart Pens is the young population in Qatar. In this population, the most attractive segment is the school, college and university going students, who will find the product as multipurpose and helpful during their academic sessions. Therefore, the primary targeting segment for the pen will be students in Qatar. As far as the performance and indicators of consumer electronic industry in Qatar are concerned, the report published by Business Monitor International in 2010 states that, “The Qatar market entered 2010 in stronger condition than many of its regional neighbors and healthy growth is expected, after a deceleration in 2009, and spending is forecast to increase to US$551.1mn by 2014.” (PR Log, 2010). In 2009, total spending on audio and video devices in Qatar remained approximately 36 percent of the total spending in the consumer electronics market. The estimation of audio and video device market, as shown in the report by Business Monitor International, had been $ 148.2 million for the year 2010. Moreover, the projected rate at which the audio and video devices market will grow till the end of year 2014, has been determined to be 3.1 percent, i.e. to $ 166.6 million by the end of year 2014. Apart from this, another segment identified, which comprises of professionals will also be targeted. This segment comprises of large number of office going individuals, faculty members of universities and colleges and other professionals. Positioning For the consumer electronics market in Qatar, the Smart Pen will be an effective and efficient means of working, particular for students, among all available audio and video recording devices because it is not only user friendly but also is of high quality with new and improved features. It is also pertinent to mention here that the smart pen comes in two varieties. The first version will be designed specifically for students, as such that it can be put to academic use. The first version will be named as Smart Pen 1.0. On the other hand, the second version will include features in addition to the Smart Pen 1.0, such as enhanced video recording and processing features, increased memory, and more options to share and use the information recorded. 6. Marketing Mix (4 P’s) Keeping in view the discussion presented in previous sections of this report, which include the analysis of external environment and the strengths, weaknesses, opportunities and threats, and taking into consideration the design, features and cost of manufacturing the pens, following marketing mix has been determined: Product The product, Smart Pen, is a specialty product, which is new to the market and consumers therein. The idea of recording important vocal or visual information through audio and video recording devices is, however, not new. At present, there are products available in the market which can be used by young consumers for education as well as for other purposes as far as audio and video recording is concerned. The Smart Pen, however, features ease of use and technology at the same time, which makes it distinct from other substitutes. However, literally speaking, the product has no close substitutes yet, other than the traditional and conventional audio and video recording devices and mobile phones. A prototype of the product is presented as follows: The brand name of the product “Smart Pen” has been selected because the product offers smart features to its users, including a 5 GB memory, 8 megapixels camera and fine audio recording capability. Keeping in view these features, the product is expected to be adopted by the target consumers quickly, as it will serve them as a personal companion wherever they go and whenever they feel a need to record audio or video. Pricing The pricing objective of the company is to maintain the product as a premium priced product. As mentioned earlier that the per capita income of people residing in Qatar is one of the best in the world, therefore the company can go for premium pricing. Moreover, since no particular competitors yet exist, therefore it is not possible to benchmark the price of Smart Pen in Qatar. The price set therefore for each Smart Pen is QAR 100, which is based on a 45 percent profit margin. This profit margin percentage is based on the fact that the company will have low overheads and a cost leadership approach is to be followed. The prices of similar products in the international market, as per the information available on online shopping site Amazon, is $79.95 (Amazon, 2014). This price when converted into QAR will amount to around QAR 290, thus implying that the price set for the Smart Pen is considerably low and the potential consumers would prefer to buy the pen from the local market rather than ordering it online from Amazon. Moreover, this follows that the company will pursue a cost leadership strategy as far as its pricing of the product is concerned. Moreover, as mentioned earlier, there are no major competitors in the market as of yet which manufacture and sell products matching Smart Pens in Qatar. Therefore, pricing of competitors cannot be listed here. Place The product will be placed in all leading retail stores in Qatar and will be supplied through arrangement with retailers and whole sellers in places where the company does not has its presence. In this regard, 20 different retail stores will be approached in the country. The company will approach those retail stores where there is a significant presence of target customers. Promotion The company will follow three aspects of the promotional mix for promoting Smart Pen. These three aspects include advertising, public relations and direct marketing. The strategies and justification for selecting these three aspects of promotional mix are presented as follows: Promotion Channel Justification and Strategy Advertising The company will use advertising as a primary strategy for promoting Smart Pen. Advertising will enable the company to better express the product in detail and its features and possible uses. Moreover, this strategy will also allow the company to reach a large number of audience. The advertising campaign will be carried out by placing advertisements in print media, such as newspapers, magazines and catalogues. On the other hand, electronic media will also be used to advertise the product, and the channels to be used in this regard will include television, radio, email, website and social media platforms. Public Relations The public relations channel will also be used for promoting the product. This channel will involve conducting meetings and seminars in educational institutions to create awareness of the product among students and to create a need for its usage among them. For this purpose, arrangements will be made with local schools, colleges and universities in Qatar. Direct Marketing Like public relations channel, direct marketing channel will also be aimed at communicating with customers directly. This technique will involve contacting customers through telephone, email and door to door visits. Moreover, specific profiles will be developed on social media platforms. Keeping in view the selection of promotional channels to be used, there are several objectives behind these strategies. The first objective is to introduce the product in the market and create awareness among consumers about the features and potential usage it can be put to. Moreover, the company also aims at developing the need among its potential customers for purchasing the product. 7. Ethical Dilemma The product, Smart Pen, may be questioned on moral grounds due to the extent to which it can used. Customers and other stakeholders may show their respective concerns regarding the ethical use of the pen by its users. As for instance, it can be used anywhere and other people would not be able to know about its use, which would in turn give the user an opportunity to use in any way he or she likes. Therefore, there is a possibility that stakeholders may argue about the compromise of privacy of other people. Similarly, educational institutions and teachers may reject its usage by students, which is the primary segment to be targeted, due to misuse of pen students. Keeping these issues in mind, there are two options available for Qatar Deja Vu, which are: To require buyers to sign a term and condition agreement so as to make them binding as far as the ethical use of Smart Pen is concerned. To carry out an extensive campaign subsequently with the marketing of product so as to increase awareness among consumers and ethical use of Smart Pen. Among these two options, the first one is less preferable as it would deter buyers from buying the product, as they may perceive significant legal consequences even if they unintentionally breach any term and condition. On the other hand, the second option is more feasible as it will enable the company to positively bring awareness among its potential customers about ethical usage of the product and the potential consequences of using it in unethical manner. Moreover, another benefit of exercising this option will be that the company will portray a socially responsible image in the society. References Amazon. (2014, May 15). 1GB Pen Voice Memo Recorder. Retrieved from http://www.amazon.com/Anybest-1GB-Voice-Memo-Recorder/dp/B0012N36DC Ibrahim, I., & Harrigan, F. (2012). Qatar economy past, present and future. Retrieved from http://www.gsdp.gov.qa/portal/page/portal/gsdp_en/knowledge_center/Tab2/Qatar%20economy%20past%20present%20and%20future.pdf Index Mundi. (2014, April 30). Qatar Demographics Profile 2013. Retrieved from http://www.indexmundi.com/qatar/demographics_profile.html Mada. (2012, November 28). Mada organizes a series of events on Assistive Technology for Communication Needs . Retrieved from http://mada.org.qa/en/news/page/3 Minister of Business and Trade. (2010). Rise with Qatar. Retrieved from http://www.mbt.gov.qa/English/ForeignInvestor/Documents/MOBT-Brochure%20englo.pdf PR Log. (2010). Qatar Consumer Electronics Report Q4 2010. Business Monitor International. Thottathil, M. (2013, September 4). Global Competitiveness – Qatar, UAE, Saudi tops . Retrieved from http://www.arabiangazette.com/global-competitiveness-qatar-uae-saudi-20130904/ Read More