Entrepreneurial Idea - Marketing and Operations - Assignment Example

Mission ment To become a robust, sustainable and well respected social enterprise towards achieving commercial and community based objectives in the best interest of our beneficiaries and stakeholders. We aim to achieve this by creating revenue from marketing a series of innovative product lines within the motorcycle sector and to develop our skills and core competencies to create service that is second to none. SWOT analysis The market entry strategy has to be formulated before the actual product is launched. It is difficult for smaller new brands to penetrate a market than it is for larger brands as they have an established loyal set of customers. Strengths A unique product in the motorcycle industry, being introduced with a Key Ring Fob and a Decorative Pin, for the first time. These features are equipped with an innovative integrative technological system to alert the rider. Secondly, the social enterprise position is a positive marketing tool. Financial support is available. Weakness New product is being introduced while the promoters and the company are also new to the market. The market response and acceptability is based on assumptions and there is no brand recognition. Threats Technology is imitated very fast and before B4L can capture the market it is likely that the giants in the motorcycle industry copy the technology and get leverage of their brand. Opportunity The youth often leave their motorcycle keys in the bike and the motorcycle market is competitive and fierce. Market trends and analysis Like any other electronic product, this product too is dependent on technological revolution. It is quite likely that new emerging technologies could replace the product. The youth tends to adapt any technological innovation that suits their lifestyle and convenience. Since this is an innovation being introduced for the first time we expect to capture sizable market in the first year itself and derive the early mover advantages. Sales forecast There are currently over 1.2 million active road using motorcyclists in the UK alone (the bike insurer.co.uk) and we plan to penetrate the European, USA, NZ, and Australian markets. We also envisage that by 2012 the majority of UK bikers will be aware of the product offering. Even though no efforts would be made to overexpose, B4L expects to capture 60% of the market share through product sales and loyalty. It is expected to sell about 15,000 units in the first year of operation. Market demographics The youth would be the main focus and different sub cultures within the motorcycle world would also be targeted. There are multileveled demographics in the market (age, location, sub cultural identity etc) but nevertheless there is a very strong unifying bond. The marketing and brand platform acts as a powerful lever. Persuasion tactics would have to be employed to motivate and understand the underlying psychological constructs for the customers to act. The focus will not be on selling the product but on identifying and fulfilling the needs of the customers. Target markets The youth recognize the benefits of new technology and can communicate these benefits to other users. Initially the product will be launched in the UK alone but subsequently we expect to penetrate into other European countries, USA, NZ, and Australian markets. Market positioning After the segmentation has been done and the target market selected, the product positioning has to be done. Product positioning refers to the product image and the impressions about the product. B4L will position the product based on the differentiation strategy as this product has no competition in the industry. The key strategy will be to create brand equity. Communication will be the essence as the compelling reasons for purchase have to be communicated to the target segment. After sales service will be ensured as it will fetch brand loyalty. Marketing mix Product The focus will be on creating a unique brand value in the first year as the product has unique features. Pricing Since there is no competition involved, the traditional pricing approach would not be adopted. The pricing will be based on the cost of marketing through different retail channels. Customers should be able to get value for what they pay. Promotion A personal approach would be adopted to educate the customers and build a relationship with them. Road and rider safety would be promoted rather than the focus on the product. Motivating behavior tendencies to support empathic and sympathetic response behaviors towards those who have been injured or to the families of those who have suffered fatalities through motorcycle accidents would be the strategy, again not focusing on the product itself. This personal approach would work well as it would help to build a direct relationship with the customers. The marketing campaign is not exercise ‘in creating an overblown empty vacuum of self importance and self promotion.’ Place The product will be placed in specialist and auxiliary motorcycle outlets apart from being available through the internet. It would also be placed at the trade shows, at track days, social events and other public occasions. Marketing communications Effective communication is essential between the different channel partners that include the customers as well as the dealers and outlets that would display or stock the product. The promotional plans have been devised keeping in mind that within the motorcycle culture there are many different sub groups and cultures that have different outlooks, attitudes and buying behaviors. Secondary research suggests over one-quarter of consumers who have internet access at home report to using the online activities to secure purchases (What is Internet marketing 2004). Hence the website address would be put on all promotional products. While forums would be provided on the website, blogging is another powerful tool that has developed because of the internet. Through blogs the customer needs can be identified and customers get to exchange views on the product. This has been found to be more effective than spending on advertising. Through our ecommerce application we have the capacity to market and collect data for up to 40 product lines. Furthermore, our strategy accounts for partnerships and two-way links to distributors and manufacturers of motorcycle accessories that complement our products, services and campaigns. Operations Operations management is the most critical element in the entire project. Being a start-up we need to be cautious in dealing with finances. While we have arranged for loans and sponsorships, we need to focus on the core functions. One of our directors is based in China. He has a technical background and would be efficiently able to handle the production process in China. Being of Chinese origin, he would also be experienced in registering the company and setting up the production process. Initial project costs suggest that shifting the production base to China would be cost-effective for the company. With our director’s local contacts the whole process would not take more than a couple of months. We intend starting a wholly owned subsidiary in China which is the best way of outsourcing. This also ensures protection to our director in China who would be an equal partner in our marketing unit in the UK. The entire process of raw material procurement, production, product testing and shipping would be handled by the director based at China. Technical know how would be sent from the UK although continuous research and development of the product would be done at China. Opening a wholly owned subsidiary and with our own technical director to take care of production, ensures against loss of intellectual property. In other forms of ventures like joint venture or even merely outsourcing production to third party, results in sharing technical information. Hence wholly owned subsidiary is the best option. Besides, the government has been concentrating on promoting high-tech capital intensive projects, which is the reason that WFOs (wholly foreign-owned subsidiaries) have increased in China (Fung, Iizaka & Tong, 2002). We can hence expect to get full support from the government in expediting the process. Other benefits of having a local director is that he understands the nuances of how to extract work from the Chinese and at the same time is able to handle the demands of the western customers. These are the benefits of having our own director to look after the production in China. The website and web interactions can be handled from the China end without engaging people in the UK that are costlier to procure and maintain. China produces 352,000 engineers a year (Valery & Kekic, 2007) and hence getting the technical personnel both for production and website maintenance would not be difficult. The set up in the UK would focus on the marketing and promotion of the product. The workforce would be trained personnel both in marketing and technology. This is essential to train the dealers and also to take care of the after sales support. The advertising and marketing functions would be handled from the UK end as physical proximity to the market is essential to understand the customer needs. This would help to define and change the strategy from time to time. A well-versed sales team would help to reach and service the customers. Investments would be focused on research and marketing to be able to capture the market in the very first year. References: Fung, KC Iizaka, H & Tong, S 2002, Foreign Direct Investment in China: Policy, Trend and Impact, retrieved online 14th March 2009, from http://www.hiebs.hku.hk/working_paper_updates/pdf/wp1049.pdf Valery, N & Kekic, L 2007, Innovation: Transforming the way business creates, retrieved online 14th March 2009, from http://a330.g.akamai.net/7/330/25828/20070514140712/graphics.eiu.com/upload/eb/EIU%20Cisco%20Innovation%206v%20070511.pdf Read More