Situational Analysis of Jade Perfume - Coursework Example

Marketing plan for Jade Perfumes Due Executive Summary According to Fisher, Pride and Miller (2005), retail isalways a one on one business with a customer or end user. This two-year marketing plan for Jade Perfume Shop is a creation of its two founders (Brian and Jacob) to secure additional financial support for the establishment, growth and expansion and to inform the investors of its status and direction. Although Jade is yet to be launched, the shop prospects greater-than-anticipated demand for its perfumes, and the survey research as indicated that the target market of perfume customers would like to buy from trusted retailers. The prospected customers are also interested in perfumes from reputable manufacturers. In addition, Jade has plans to survey opportunities for the ever-increasing online sales (Fisher et al. 2005). Over the next two years, Jade can impose itself as the strongest emerging competitor in the perfume retail industry through increased distribution, new products from manufactures, and win new customers to maintain its leading strength. Situational Analysis Jade perfume is the new kid in the block. ‘A new kid with new rules’ is the number one Jade slogan. It is not just a brand shop but also the emerging strongest competitor in the retail perfume industry. Customers should think of Jade as, not just a brand but also as a luxurious, modern, fun, innovative, professional, trend-setting, innovative and friendly collection (Fisher et al. 2005). As a perfume and cologne collection shop, Jade Perfumes has an overwhelming marketing environment with opportunities as well as a variety of challenge both internally and externally. SWOT Analysis a.) Strengths Jade has a number of strengths that will make it the strongest emerging competitor in the industry. First, the brand name in itself is eye-catching, simple and sweet. Jade as a name is always associated with cute ladies and a perfect name for a perfume and cologne shop. Second to the strengths is the target market. Jade perfumes target the youth (teenagers and young adults) and the elderly men and women alike. Pricing is the third strong factor that separates Jade from other shops in the industry (Fisher et al. 2005). The designed pricing system will accommodate middle income and wealthy individuals. Jade products range from the pocket friendly to the expensive perfume brands. The products are divided into sections with different pricing, and every person who gets into Jade perfumes will certainly come out happy. Fourth, Jade has a strong professional team that will serve the customers to their satisfaction with a dedication of achieving the leading perfume store in the locale (Mcdonald 2011). In addition, Jade has sought the partnership of the leading Perfume and cologne manufacturers. Apart from the brand name of ‘Jade, there are other specific several other brands within the brand that will make the store irresistible to human traffic. The retail shop will also be located in a strategic location accessible to all target customers. b.) Weaknesses As strong as it emerges; Jade Perfume Collection faces competition from the already established perfume stores. Since it is just establishing Jade has a small size store that can accommodate few customers per transaction. In addition, there is limited security for raising finance for growth and expansion hence the store will entirely rely on its profits (McDonalds 2011). Nonetheless, as a new store in the market, Jade must focus on establishing customer management skills at the beginning that might impede customer retention. c.) Opportunities With an area of the establishment, Jade has a strong foundation of opportunities to build on. The perfume and cologne industry is known for its brand loyalty issues. Jade has a strong brand management strategy that will ensure it emerges as the best brand shop for all customers. To build on the strength of the alliance with manufacturers, Jade has a plan to collude with the manufacturers to include the Jade logo on their products strategically to influence customer choice on the store. In addition to this, the marketing team will negotiate for joint marketing and specifically advertising with the top manufacturers to ensure that the brand name is established in the minds of the potential customers (Fisher et al. 2005). There is a poor reputation of most stores selling replica perfumes. Jade intends to build on this through its strategic collusion with the manufacturers to build the originality of the products and express itself as the number one original perfume shop (Westwood 2002). The customer acquisition is a potential area of build up for Jade Perfume Shop. After establishing itself with the manufacturers and branding itself as the number one original shop, Jade intends to focus on acquiring customers and building brand loyalty. Nevertheless, profit maximization is a greater opportunity with the increasing availability of disposable income to beauty among potential customers in the target market (Fisher et al. 2005). Lastly, is an opportunity for expansion in the future that will follow the expected tremendous growth of the store. Perfume pricing is very difficult and most store associate high pricing with quality hence charge customers more than necessary. Jade has a plan to establish its prices in accordance to operation expenses and gain customer confidence with affordability and originality of the products. d.) Threats For every intention of success, there is a threat of making it redundant, and Jade Perfume is not an exception. Jade will need to overcome many threats. First is the customer loyalty. Customers in the perfume industry tend to establish their loyalty to specific stores, and Jade must acquire the through whatever means and establish their loyalty. The second threat is the poor reputation of the industry in replica establishment for the top existing perfume brands. As a brand in itself, Jade Perfumes stresses on originality because we understand customer feelings and disappointments (Luther 2001). The Key issues from SWOT analysis that Jade must take keen consideration upon include the branding of the store, staying at the top of the competition, affordability of the products and customer relation and management. In addition, the store must have a plan for expansion and strategic alliances to build on its brand loyalty. Nevertheless, Jade must focus on the target market, and customer acquisition as its location is strategic for access by all customers (Salmi 1998). Competitor Analysis Jade Perfumes Shop intends to be the strongest emerging competitor in the perfume retail industry. Competition exists both internally within the shop and externally with other stores. Internally, there will be shelf position for the competition from different perfumes from different manufacturers. McDonald (2011) outlines that, this will be a motivator factor to acquire more customers and establish Jade as the leading perfume retailer store. The perfume retail industry sells about $5 billion or more worth of goods annually. Apparently, the retail market is emerging and has few entries. Bean, REI, Perfume Pros, Timberland and Patagonia Cabello’s are among the larger recognizable perfume retail shops. There are also lesser competitors such as Suzanne collection and Anthony’s Beauty, which offers the same products and take a percentage of the market. The stance for the retail industry in general—Jade in particular—is optimistic for several reasons. First, consumers prefer shopping in retail shops near their homes, especially for beauty and non-consumable products. Second, consumers prefer local non-expensive retails. Third, hence; there is increased demand for such products as perfumes (Welfare 2011). While the above-listed retail stores are potential competitors, none presents the kind of mixed trendy and elegant yet advanced and affordable like Jade Perfumes. In addition, none has customized slogans and logos that Jade plans to offer. Nevertheless, are deemed expensive and have the poor reputation of low quality and replica perfumes. Finally, Jade perfumes are presented at moderate and affordable prices; hence, they are affordable to a variety of customers. For instance, a Jade perfume may sell for $21.99, in comparison to a competitor’s perfume that sells for $29.99. One of the market surveys conducted by Jade revealed that 67% of responding customers prefer to purchase perfumes as soon as the previous one loses its strong scent, so the moderate pricing of Jade will attract them and boost revenues. Marketing Objectives Jade seeks to utilize its core competencies to attain a sustainable competitive advantage, in which competitors cannot offer the same worth to consumers that Jade does. To achieve this, Jade has the following marketing objectives; (1) to offer high-quality, branded perfumes highly reputable manufacturers whose image is easily recognizable among customers; (2) to form a sense of community amongst customers who buy the products; and (3) to developing a strong reputation above other retailers and manufacturers as a reliable customer center. The firm intends to build on these objectives through increased marketing efforts that will raise the number of products offered as well as, manufacturer alliances and more distribution outlets. Marketing Strategy The market research carried out by Jade proprietors revealed that most perfume retail shops stock more counterfeit perfumes rather than original. In addition, as much as many consumers prefer to be connected to high-quality products they do not have the will of paying high prices and prefer shopping closer to their homes. Nonetheless, perfume customers prefer to maintain their loyalty to established stores (McDonald 2011). The study also revealed that established perfume customers welcome after sale services like delivery upon order. To share in the view of (Westwood 2002), Jade has a marketing plan of emerging in the perfume retail industry and using these competitor weaknesses to establish its competitive advantage as the strongest and most reliable perfume store. We believe that the most appropriate marketing strategy merges a superior network of contacts within the industry, development of a superior reputation for reliability and quality and the attainment of a sense of community with customers. Jade aims at achieving this strategy by pursuing distribution of brochures, straight contact with buyers in selected areas and product display in the business premises (Luther 20010). In its bid to establish itself as the most appropriate destination for perfume shops, Jade has an accommodative pricing strategy to accommodate all the market segments. Moreover, the store has plan of maintaining contact with the most known perfume manufactures in the industry a factor that will support its bid of emerging as the number one original perfume shop in the locale (Samli 1998). Jade will also use a distribution plan that will ensure that customers get access to the products from wherever they are located. Action Programme a.) The Target Market Jade has a target market of active perfume costumers between the ages of 15 and 60. The target market has segments of teenagers, young adults and adult people. The segmentation further extends to womans perfumes and mans colognes. In addition, segmentation also includes the less expensive perfumes to those very expensive but affordable to consumers especially between the young ages of 15 to 18. Everybody who enjoys using a perfume is a target customer of Jade perfume shop. However, these active customers represent a demographic cluster of successful and well-educated individuals for the adults; they are single or married and love to smell nice and the entire population of junior and senior youths and adults. The Household incomes of the well-educated and successful individuals vary between $ 5000 and $150,000 annually. Regardless of their comfortable incomes, consumers are always conscious of commodity prices hence they consistently seek worth in their purchases. In addition, despite their age the target customers lead an always luxurious, modern and cautious lifestyle: they are always status oriented. The target customers like to be linked with high-quality commodities to stand out in the crowd but do not have the will to pay premium prices for their chosen brands. b.) The Marketing Mix Product strategy: Jade has a plan of offering a range of high quality and modern perfumes and colognes for different market segments. The perfumes have categories for youthful girls; middle class employed and high-class and rich ladies. The male colognes also have categories of youthful boys and middle class and successful men who value high-end quality colognes. As aforementioned, Jade plans to collude with the manufacturers to include its logo in conjunction with the logo of the manufacturer on the perfumes in the next two years. In addition, Jade plans to have a slogan for each segment of the market to attract more customers by identifying with them through the slogan. The slogans will be changing according to the changing consumer tastes and preferences according to the plan. Jade also has a plan of staying trendy, modern; consumer-focused and innovative in their product provision to the customers (McDonalds 2011). Pricing Strategy: According to the earlier discussion in this plan, Jade perfumes have a c competition-oriented pricing strategy. The store has less concern with high pricing to signal prestige or luxury, neither will the store attempt to attain the goals of compensating low prices by selling high quantities of products. Instead, the pricing system must prove the worth of the perfume to ensure customers feel comfortable while purchasing. The pricing strategy in the plan also makes Jade perfumes better gifts—for graduations or birthdays or just for customer appreciation (Westwood 2002). Customization of the perfumes in conjunction with the manufacturers will increase the selling price for $4 to $6 more than the regular perfumes with manufacturing company logo. The pricing of the perfumes will offer a good value besides that of competitors. Promotion Strategy: Jade has a comprehensive plan of communication with consumers. The information about Jade Perfumes store and its range of products will be available on the internet as well as printed hard copy brochures (Fisher et al. 2005). The store also intends to use direct mailings and personal consumer contact in order to reach all the potential customers. Contrary to the ways of competitors, the store has a dedicated promotion team that will ensure differentiated promotional techniques from those that our competitors apply. As a retail shop, Jade perfumes store prefers to rely on personal contact with their customers. Personal contact, whether by phone or in-person, helps express the Jade message, reveal the unique qualities of products, and maximize in building customer relationships (Fisher et al. 2005). In the next two years, Jade sales representatives will maintain personal contact with the customers for one or two times a month. With increased expansion in distribution, Jade will adjust its sales to meet larger demand through increasing the sales staff to ensure the store is visited more frequently. Public relations and Sales promotions currently form the bulk of Jade’s promotional strategy. In the agreement with (Welfare 2011), the staff of Jade Perfumes store will work closely with customers to offer short-term sales promotions. In addition, Brian Kevin’s, the marketing manager is presently working with several influential individual including celebrities to offer Jade perfumes solid promotional basis. Jade also has a plan to roll out nontraditional marketing methods that involve little cash with lots of creativity and innovation in the next two years (Welfare 2011). Because Jade is a small, flexible and dynamic organization, the shop can easily implement creative ideas such as treating customers with skiers, free drinks, and discount coupons within the store. In the next year, the shop plans to employ in the following strategic marketing efforts: (1) Create a Jade open day within the store, in which several employees customers will be treated to free drinks, promotional prices and product. (2) Showcase Attend community outreach programmes that will enable the staff to establish bonding with the community around. (3) Organize entertainment collisions with the local leading entertainment spots like bars, clubs and hotels with free food and drinks upon purchasing a certain quantity of perfumes. Distribution strategy: Currently, Jade perfumes store plans to start up one store in London. The distribution strategy includes specialized and branded packaging materials. The main factor that determines the distribution is a method of purchase. Customers who order products will receive delivery upon order while those that come to the store will benefit from discounts and other in-house customer related distribution techniques. Jade will obtain much of its information about trends of the overall industry in different geographic areas and at different market segments from its trade organization and Outdoor Industry Association (Luther 2001). In the next two years, Jade seeks to expand the distribution of its retail shops to more than five outlets. However, the focus will still be in London. The store, however, has not yet determined whether it would be beneficial to expand its stores or outlets outside London. In addition, Jade has a plan to intensify the online sales of perfumes by offering customized perfumes via Internet only, thus differentiating between Internet offerings and personal sells. Eventually in the next two years, we may plan to establish internet kiosks at some of the selected more profitable store outlets to help customers order Jade Perfume shop’s customized products form the selected stores. Regardless of our expansion plans, Jade fully intends to evaluate, monitor and maintain viable and strong relationships customers (McDonalds 2011). Projected Profit And Loss Statements Jade perfumes shop will operate on higher operating expenses due to the luxurious nature of the industry. The purchase of the perfume stocks accounts for the huge amount of the operating expenses. In addition, the store plans to spend more on promotion, advertising and distribution. Jade also has a plan of increasing the number of stores hence the increase in operation expenses in the second year. Ensuring the business is a brilliant idea hence the company must spend on business insurance (McDonalds 2011). In addition, the shop sources external legal and accounting expertise hence their expenses are excluded from the normal employee payroll expenses. The internet marketing and web design expenses is included in the category of other expenses together with other expenses like miscellaneous expenses and other in-store promotion expenses. It is Important to note that Jade anticipates long-term operations in the near future and has no plans of exiting the retail perfume market. Instead, as outlined throughout this marketing plan, the shop has plans of increasing its existence in the market (Westwood 2002). In addition, Jade has no plans of merging with another retail shop or making any public stock offering. Control Methods Jade perfumes shop will undertake a review of the marketing plan every month to evaluate progress and adjustment as the business progresses. After the first half, the evaluation may reduce to every second month if the marketing plan is under positive control, working efficiently, and effectively (Westwood 2002). Jade, updates its information of new technology, products and new manufacturers in the market. We plan to contact both local and overseas suppliers regularly. The staffs, especially marketing team, will monitor all the marketing techniques. Any techniques considered successful will be expanded, and those that are unsuccessful will be abandoned. The shop, through its accounting team, will specifically, conscious and continually monitor the financial position of the business. The team will carry out monthly comparisons between actual sales, cash flow and profitability, and their projections. The operation costs of each strategic marketing activity will be compared to estimated costs to ensure accuracy and achievement of profitability (Samli 1998). References Fisher, P. H., Pride, M. M., & Miller, E. G. (2005). Blueprint for your library marketing plan: a guide to help you survive and thrive. Chicago, American Library Association. Luther, W. M. (2001). The marketing plan: how to prepare and implement it. New York, Amacom. McDonald, M. (2011). Marketing plans: how to prepare them, how to use them. Chichester, Wiley. Westwood, J. (2002). The marketing plan: a step-by-step guide. London, Kogan Page. Samli, A. C. (1998). Strategic marketing for success in retailing. Westport, Conn, Quorum Books. Welfare, A. (2011). The retail handbook: helping you achieve your potential in retail. St. Albans, Herts, Ecademy Press. Read More