Evaluation of Market Share - Essay Example

Marketing Mix The marketing mix, often referred to as the four Ps’, is a means for organizations to combine the four key elements which are the product, the price, the place and promotion achieve its business objectives. Every business is different, thus each must decide on its own marketing mix that balances the four Ps to suit its products. The mix is dependant on factors such as the type of the product, competition in the market, the market itself, and also the research done on the market. In our case we are dealing with a new brand of the watch by the name the fit watch. Having the right marketing mix enables our organization to achieve its business objectives. Fit watch business objectives include creating brand awareness, acquiring market and maintaining it. The Product Product is the central point on which fit watch marketing department focus on. It is concerned with what the product means to the customer. Marketing group therefore plays a key role in determining such aspects as: the appearance of the product in line with the requirements of the market; the function of the product on the question whether it addresses the needs of customers as identified through market research. The product offered is a watch. The company has discovered a need to increase the satisfaction level of the watch to the customers as well the advancement of technology. The watch has all the essentials that a customer looks for while considering making a purchase. It has all the performance characteristics of an existing watch. In addition to this, it has additional features such as flashlight, Wi-Fi hotspot and better health tracking strategy. The characteristics will help the watch to take the obligation of a torch will take part in internet access through Wi-Fi hotspot and as well will act as a friendly device to health of an individual. Price Pricing is one of the most important decisions made by any business organization. Of all the aspects of the marketing mix, price is the one which creates sales revenue while all the others are costs. The price of an item is clearly an important determinant of the value of sales made. In theory, price is really determined by the discovery of what customers perceive is the value of the item on sale. Researching consumers opinions about pricing is important as it indicates how they value what they are looking for as well as what they want to pay. Economists use the term market clearing price to identify a price at which sellers are prepared to sell because they feel they are getting a fair price, and buyers are prepared to buy because they feel they are getting value for money. When making pricing decisions, fit watch marketing department take into consideration various cost that affect the manufacturing of the watch such as material cost, operational cost, administration cost sale and distribution and all cost that affect already made product. Hence it ends up charging a price that reflects the perceived and actual quality of the product, a price that provides a healthy return on capital invested. Another important aspect considered is the price of the competing product. The most significant factor in pricing is that the final decision will be market driven. Promotion Promotion is the business of communicating with customers. It provides information that assists customers in making decision to purchase a product or service. A successful business promotion will significantly increase sale of the product. In our case considering that we are dealing with a new brand, the most effective promotion strategy is the use of advertisement. Advertisement is a form of communication designed to persuade potential customers to choose your products or service over your competitors. Our product is new in the market, thus no set customers as compared to our competitor who have a ready established market, with buyers who might be loyal to them. Secondly, we are targeting a large market in the form of geographical area to be covered and population structure. This is because advertisement helps to: It makes the business and product name familiar to the public. Create a good will and build favourable image. Educate and inform the public. To offer specific product. Attract customer to find out more about the products and service. Although there are many forms of advisements media such as television, newspapers, and magazines, the most preferred is the use of the social networking tool. This is because the cut across the whole world and the user are the same people with a taste of a luxurious watch like the fit watch. Place When we talk about place we are concerned with various methods of transporting and storing goods, and also making sure that they are available to the customer when needed. In other words getting the right product to the right place at the right time involves the right distribution system. The choice of distribution method will depend on a variety of circumstances. The entity chooses to deliver its goods direct to the retails who sell to the customers. This is due to the following reasons The retail outlets reduce the number of middlemen involved, hence cutting down any additional cost on value added cost. Retail outlets allow customers to see what they are buying hence convinced easily. Owners can develop relationships with customers especially where the company establishes its own retail shop, Through these the company increase it local credibility, since many customers choose to patronize stores that are unique and part of local community. The sales procedure is shorter and easier since customers come to shop and staff serves them directly. This in return helps to create good relationship between the customer and the business entity. The retailers get the product from our store located in different cities across the world. Marketing Implementation Strategy A strategy is a plan that enables an organization to achieve its aims and objectives. For fit watch, the key objectives of its marketing strategy are to create brand awareness and make a share in new markets. A marketing strategy, both influences and is influenced by the organizational strategies. It has a primary focus in selecting who should be our customer and guiding on what and how to sell the product. Some of the marketing strategy elements are I. Market segmentation When trying to define our target market, we should consider gender (male or female), age group(children, youths or aged), regional area, education(literate, semi-literate or illiterate) , and occupation(employed or unemployed) or the personal income. Secondly, we should have a clear understanding of our product for example the purpose it accomplishes, the advantages of our product to consumers compared to our competitor’s product, and also the problems customers may be facing that our product solves. This should be done long before the manufacturing of the product starts. This calls for intensive research on the most favourable market segment. In our case the fit watch highly target the young generation and the noble in the society. The capability to use Wi-Fi is also an added advantage as the world want electronics with different usage. II. SWOT and PEST analysis After market segmentation, we look at our strength, weaknesses, opportunities and threats. This is done by examining our product in relation to customers and competitors. The PEST (Political, Economical, Social and Technological factors) analysis will help identify the main opportunities and threats of our business. It’s good to have an understanding of what we expect while starting and when running the business, hence this should be done before and while continuing with business. III. Developing a promotional strategy These entail giving information to your customers in the market. It involves product strategy which is relatively product positioning and differentiation. The fit watch business will create brand awareness to position the product in customer’s minds for example through advertisements. In addition, we apply different methods of differentiation such as packaging differently from our competitors and our products having additional features to those of competitors. This should be done during the production period. IV. Product portfolio/ product life cycle The life of a product is the stages that relate to the pattern of sales. The time period associated with the product life cycle will vary according to the product and other influences. For some, the whole life cycle could be a matter of days or weeks, for instance a piece of fruit. Others may be months, for instance, seasonal items like fashion garments. For our product (the fit watch) we expect to last for decades. It is important to adapt the marketing mix in order to respond to changes in the market. Marketing strategies such as seeking new markets, promotion, pricing and developments that add value can extend the product life cycle. To keep the fit watch competitive, it is good to understand where it lies in the product life cycle. This calls for relevant knowledge about the products in the market owned by competitors which determines the phase in the life cycle where our product lies. We focus on what makes us different to and better than our competitors who will make us remain on top. Marketing Budget A marketing budget is an estimate of projected costs to market your products or services. A typical marketing budget will take into account all marketing costs for example, marketing communications, salaries for marketing managers, and the cost of office space. However, much of the budget is concerned with marketing communications for example public relations, website, and advertising. Marketing budgets ensure that your marketing plan or campaign has a realistic cost allocation. Projected marketing budget for the fit watch Projected marketing budget for the fit watch Details $ (000) $ (000) Projected sales 500 Projected cost of production 300 Cost of production (300) Projected gross income 200 Marketing expenses Advertising cost Television 5 Social networks 12 Magazines 5 Journals 8 Newspapers 10 Research 20 Sales and distribution 10 Administration cost 10 Salaries and wages 5 Total cost 85 (85) Projected net income 115 Control and Evaluation I. Response to customer’s feedback Marketing is designed to persuade customers to purchase a product or invest on a service. One of the control measures that the fit watch company will put in place in our marketing plan is monitoring of customers’ feedback through polls and surveys. This will help to boost customer relations as their needs are met hence becoming loyal to the company. II. Evaluating target market sales Sales can be measured in units sold, revenue generated or profit amount. Each marketing plan sets out to determine the effect of the plan in the target market. This is done through market surveys or at the point of sale with the assistance of a retail partner. Actual sales in the target market are compared to the market plan projection to see if any changes need to be made.. III. Budgeting A market budget is a balance between the cost of generating the advertising materials and the revenue created by the marketing plan. There are a number of controls in places that can be used to monitor marketing budget, that include print or broadcast advertising expenses, travel expenses, for trade exhibits, the cost of market research studies and internal personnel costs for the company’s marketing department. IV. Evaluation of market share This is the percentage of consumer sales dominated by your product. A market plan reflects the market share for a product before the product hits the market and then projects the changes to the marketplace when the plan is over. Conclusion For a new product to survive in the market, its efficiency should be highly put into consideration because the failure to examine how the product would perform in the target market before the actual role out can be detrimental to a business. This is what determines the availability of the market and promotes its competitiveness. For efficiency to be realized, intense research should be carried out as well as intense promotion. A proper budget should be prepared and implemented; feedback from the customers should also be taken with weight. Read More