UV Protector Spray for Billabong Company in Australia - Essay Example

UV Protector Spray for Billabong Company in Australia of Executive Summary This paper is based on the detailed study of the new product launch of Billabong, which is a UV protector spray. It encompasses the details of the new marketing mix of the Billabong product, price, place and promotion. The product strategy includes the core, actual and the augmented value proposition of the product. The pricing strategy has been based on the six stages of pricing. The promotion is focused on the suitable promotional mix and finally the place strategy has been designed based on the suitable distribution strategy. The paper has also offered a recommendation for the second year of marketing of the UV protector spray for Billabong. Table of Contents Introduction 4 Product 5 Detailed Explanation 5 Type of Product 5 Branding Strategies 5 Packaging 5 Product development process: Development Stage 6 Place 6 Promotion 7 Promotional Mix 7 Price 8 Conclusion 10 References 11 Appendix 12 Introduction Billabong is an international clothing and accessories company based in Australia. The company operates in several overseas locations and primarily focuses on beachwear and wetsuits for both male and female customers. The company owns several brands such as RVCA, Element, Von Zipper, Xcel, etc (Billabong, 2015). The environmental analysis of the Australian market of beachwear and beach accessories suggests that it is capable of supporting the growth of the industry. The environment of Australia is relatively stable and attracts many tourists from overseas locations to enjoy Australian beaches. The stable political environment also suggests that there are no internal conflicts that may affect the business operations of the company. The stable economic condition of Australia indicates that the customers have the necessary disposable income to purchase the company’s products. Moreover, the social construct of Australia also reflects that people prefer to visit the nearest beaches and enjoy surfing in the sea (CIA, 2015). Thus, the customer base of beach wear and wetsuits is quite huge. The target customers of the company are mostly the young population who prefer visiting beaches and wear fashionable and trendy beach wear and accessories. The company has targeted the customers based on their age group, which mostly ranges between 15-35 years. The company caters its products to the upper middle class of society, who bears both the necessary disposable income and mentality to engage in leisure activities such as hanging out on a beach with friends. The marketing goal of the company is to increase its product portfolio so as to increase the customer footfall and improve its revenue generation and brand equity. This will be achieved by introducing a new product: UV protector spray. The marketing goals involving the new product launch will involve new promotional activities including television commercials and print media ads in fashion magazines. The company will introduce the new product in the home country first and then depending on its success, it will introduce it to other locations. Product Detailed Explanation a) Core product: The core product is the UV protection solution that is in a form of spray, so that it is easy for the customers to apply. The core problem solving ability of this product is focused on protecting the customers from the UV rays of the sunlight on the beach. Another core benefit of the product is that the spray is easy to apply on the body. b) Actual product: The product will come in a spray can of standard size, which will be easy to carry in a small bag. The outlook or the external styling of the can will bear images of sea, surfing and sun. This packaging is quite important to draw the attention of the customers. The images of the packaging will communicate to the customers through visual cues and will portray what the product stands for and who it is targeted at. This will help the company to deliver the core product to the customers in a more attractive manner (Aaker, 2010, p.106). c) Augmented product: The product augmentation involves extra value addition that improves the perception of the customers towards the products. The company will highlight the fact that the spray is devoid of any harmful chemicals and have high quality assurance. Type of Product The UV protector spray for Billabong can be considered as a convenience product, since the customers do not need to go through much data processing to purchase the products. Branding Strategies The branding strategies are imperative to ensure that the company is capable of attracting the target customers and deliver the right value proposition for them (Keller, 2008, p. 484). The company will promote its new products through celebrity endorsements. The celebrity will be chosen based on their popularity among the young population. Moreover, it will also portray that the new spray form of UV protection solution can be quickly and easily applied on the body. Packaging Since the product is targeted at the young population, so the packaging or the outlook of the product must bear colourful imagery to attract the target population. Since the product will be sold in tin spray can, so no extra packaging of paper box is required. The can will be sealed by a transparent plastic to ensure the product’s authenticity and it will also make the image on the body of the can visible. Product development process: Development Stage The product development stage involves developing the physical product in the research and development department of the company (Kotler, 2009, p. 550). It involves giving the R&D team the specifications required for the upcoming product and the desired features that it needs to possess. The R&D team ensures that the final product consists of all the features demanded by the management. Moreover, the development stage will also ensure that the product is safe to use. In order to do that, it needs to go through several testing phase and needs to be authorized by the industrial standards. The final product development will go through the quality assurance phase which will ensure that the product is of desired quality and is capable of delivering value to the customers. Place In order to distribute the products among the customers, the company will need to apply a suitable distribution channel strategy. Billabong is one of the best known brands in Australia, so the company owns its distribution channel which can be easily leveraged to introduce its new products. The existing distribution channel will give the company access to supermarkets and hyper markets, where it can easily launch its new products. In order to gain access to the smaller convenience store, it needs to develop new distribution channels to cover small retailers as well. The factors leading to the choice of distribution channel is largely dependent on the target customers. The distribution channel discussed in the previous paragraph will allow the firm to cater to wide range of its target customers. The distribution channel will also be chosen based on the stores in which the target customers visit the most (Wilson & Gilligan, 2012, p. 529). The maximum effort on the distribution will be done on the channels that lead to the stores that are closest to the beach and the ones that stock beach wears and accessories. Retailing allows the marketers to generate added value to the customers in terms of different utilities, thereby making their purchase experience better. The time utility will allow the customers to buy the products at any time convenient for them. This can be achieved by making the products easily available in small retail stores and kiosks (Cant, Strydom and Jooste, 2009, p. 323). The place utility will help the customers to purchase the products wherever they want. This can be done by offering the product via online retailers. The form utility will allow the customers to easily carry the UV protector in the form of a small can which can be easily carried in bags. Figure 1: Benefits Offered by Retailers. Reprinted from Marketing (p. 366), by Elliott, Rundle-Thiele & Waller, 2012, New Jersey: John Wiley. Copyright 2012 by John Wiley. Reprinted with permission. Promotion The primary goal of the promotion is to create awareness among the customers regarding the new product launch. It will also allow the company to convey the brand image of the product thereby attracting the target customers. Promotional Mix Advertising: The advertising will include television commercials with celebrity endorsements. The commercial will be aired at youth centric media vehicles to create the maximum exposure to the target customers. The advertising strategy will also include print media such as fashion magazines and news papers. Sales promotion: The company will offer introductory discount offers to boost the initial sale and to create brand awareness among the customers. It will also offer discounts on bulk purchases. Direct marketing: Billabong can also offer its products through direct marketing channels such as telecalling or online marketing through its own website. The integrated marketing communication will allow the company to communicate with the customers through various ways (Percy, 2008, p.33). These include television commercials, online marketing, social media marketing, email marketing etc. The integrated communication is more effective in influencing the customers’ purchase decision as it communicates through different mediums. The advertisements and other promotional activities will pull the customers towards the new product. Moreover, the brand image of Billabong and high availability of the products will easily pull the target customers, thereby, increasing its sales. Price The six stages of pricing strategies will be utilized to select the appropriate pricing strategy for the product. Step 1: The pricing objective is to set a price which will help the company to recover the initial investment for the product development and create a desired profit margin and at the same time be compatible with the brand image (Ferrell and Hartline, 2010, p. 246). Step 2: The target market has a tendency to relate quality of a product with price. So, the price will be placed slightly above average than other UV protector products. Step 3: The competitors’ pricing will also be considered while setting up the final price, so the customers can easily relate the value proposition of the product to that of the rival brands. Step 4: The pricing will be based on competition and demand. The promotional activities will create a demand among the customers which will help to justify the slightly higher price of the product. Step 5: Billabong will follow the strategy of penetration pricing to gain the customer preference. Moreover, since it is a convenience product, so it will be suitable to follow a penetration pricing strategy. Step 6: The final price of the product will be at $10 for a 200 ml can. Figure 2: Six stages of Pricing Figure 2: Benefits Offered by Retailers. Reprinted from Marketing, by Elliott, Rundle-Thiele & Waller, 2012, New Jersey: John Wiley. Copyright 2012 by John Wiley. Reprinted with permission. Recommendation In the second year of the product launch, the company will increase its variant of UV protector sprays by offering different alternatives based on different added perfumes and can volumes. Moreover, the company will also expand its location and introduce the product outside Australia. This as a result, will increase the customer base of the company and generate higher revenue. Conclusion Billabong will successfully launch it new UV protector spray by properly designing its marketing mix. It will analyse the market environment and will design the product, price, place and promotion for the product. The product strategy will offer the customers with a series of value addition in terms of product features. The pricing will allow the company to generate the desired revenue and consumer perception. The place strategy will allow the company to select the right distribution channel so that the customers can easily purchase the product. Finally, the promotion will ensure that a large number of customers will be attracted to the product. These strategies will ensure that the product will be successful in the near future and will ensure long term sustainability of the firm. References Aaker, D. (2010). Strategic market management: Global perspectives (6th ed.) (p. 106). Oxford: Blackwell Publishing. Billabong. (2015). Corporate overview. Retrieved from http://www.billabongbiz.com/phoenix.zhtml?c=154279&p=irol-irhome Cant, M. C., Strydom, J. W. & Jooste, C. J., (2009). Marketing management (p. 323). Claremont: Juta and Company Ltd. CIA. (2015). Australia. Retrieved from https://www.cia.gov/library/publications/the-world-factbook/geos/as.html Elliott, G., Rundle-Thiele, S. & Waller, D. (2012). Marketing. (p. 366). New Jersey: John Wiley. Ferrell, O.C. & Hartline, M. (2010). Marketing strategy. (p. 246). Connecticut: Cengage Learning. Keller, K.L. (2008). Strategic brand management (p. 484). New York: Person Education. Kotler, P. (2009). Marketing management: A South Asian perspective (p. 550). New Delhi: Person Education India. Percy, L. (2008). Strategic integrated marketing communication: Theory and practice (p. 33). London: Routledge. Wilson, R. M. & Gilligan, C. (2012). Strategic marketing management. (p. 529). London: Routledge. Appendix a) Product concept map b) Distribution Diagram c) Picture of Brand d) Picture of Promotion idea e) Pricing List of competitors’ UV protector products Products Price Neutrogena Ultra Sheer Sunscreen $13.27 Banana Boat Ultramist SPF 30 Sport Performance $ 15.77 Coppertone Sunscreen Lotion Ultra Guard Broad Spectrum SPF 50 $ 7.57 Biore Sarasara Uv Aqua Rich Waterly Essence Sunscreen 50g Spf50 $ 11.99 Read More