Guildford as an attractive Market Proposition With Very High Potential for Growth - Research Paper Example

Introduction A strategic marketing plan can be stated as the summary of the most important market trends. Also, it looks into key target market segment. The strategic plan lays down the value or importance that is required in each segment. It also looks into creating additional values to tackle the market competition successfully. The market objective, strategies and financial situation all are considered before coming up with an integrated marketing plan. Integrated marketing is a type of marketing in which the company does its planning and strategy keeping in mind the customers point of view. The marketing plans are created based on response to customers taste and preference. This is done for increasing sales. The term ‘integrated marketing’ is mainly used to describe an emerging and also a new philosophy of marketing that is potentially comprehensive (Knol, n.d.). Integrated Marketing There are three themes of integrated marketing emerging in the present marketing context. The main theme which has erupted is the targeting part of marketing. Here, in this context it is understood that it is better to target or focus on a fewer number of people by providing them customized services. The term direct marketing and direct mail are part of this strategy. The customization of services is done in design and also in the delivery part of the product that is being offered. This approach of keeping the customers point of view at the centre of any marketing decision has made for tailor made approach. This has been advantageous to both customers and the company (California State University, n.d.). Targeting approach that is used in the integrated marketing has to be used as an approach for maximizing the response to the customers and also in decreasing the wasted effort from business point of view. Integration approach in marketing has to be mainly used in target segments of customers (Lacobucci, 2003). The integrated marketing approach has to integrate with consumer behavior over a certain period of time and dimension. The strategy that is used to communicate with the customers is another dimension of integrated marketing approach. In this approach, advertising in television is used. It helps in reaching a larger number of audiences. In terms of communication part, marketing approach has to be constructed with the integration of measured media approach and other different communication opportunities (Office of College Development & Office of Planning, 2007). Integrated Marketing Plan Approach An integrated market planning approach includes the understanding of the following scenarios in the market like that of market structure and segmentation, differentiation, scope and value capture approach. In market structure and segmentation approach, the market segment that the company wants to serve is decided at the outset. The market share, market potential, volume of the market, products and service flows are determined in order to decide on an integrated plan. In differentiation approach the factors making the company different from its competitors are identified. The company in differentiation approach tries to understand whether the potential difference can add value to the customers. The scope of integrated marketing plan approach deals with finding out details about the potential of the market segment. The potential for growth and profit is identified. Here, the marketing mix like product, price, place, promotion and also service part of marketing is analysed. The key issues of marketing are identified and need for further improvements are thought of in this approach (Ebren, 2006). For the value capture approach of integrated marketing, the strategy and objective part is adding any value to the overall profit goal of the company is identified. The flow of budget is discussed here to identify whether it is being used logically or not (Southern State Community College, 2007). Market Planning and Strategy Effect on Business Market planning approach deals with assessing the need and the want of the market. It tries to create a design outline that is to be followed in business. This approach includes creating an action plan. Creating vision, strategic intent, objectives and also goals are all part of market planning approach which is followed in business. The market planning is the application that uses market resource for achieving the objectives of business. Market planning approach includes the following: Formulation of assumptions which are to be followed at a basic business level Setting up objectives for the sales part of business to understand what is sold and also to whom it is being sold Situational analysis is performed to understand the reason behind occurrence of certain events in business The decision is taken to understand the way the company and business objectives can be achieved. Actions are scheduled and cost out for implementing the plans (McDonald & Keegan, 2002). Situational analysis approach of business is considered to be the first part of business approach. In this segment, the SWOT analysis is conducted. Then, the construction of the plan approach is carried out. In order to make a marketing plan successful, it has to include an integrated approach from the business organisation. The process should include proper review of objectives, programs, strategies and budgets that are to be followed by the business. A marketing plan helps an organization in identifying sources that bring competitive advantage to them and also to properly use an organised approach, developing specificity and ensuring consistency in relationship are all part of integrated business approach. Marketing plan also needs to have a proper objective and goal. It also needs to be integrated with proper strategy and tactics. Strategic marketing planning includes formulation of a proper mission and vision statement. The mission and vision statement also helps an organisation by guiding them through every aspect of business. The mission statement describes about how a company wants to reach its goals and objective that is the path that the company should take to achieve their purpose of doing a business. The mission statement also describes about the business and the core competencies that the business and organisation has to offer. It is mainly a qualitative approach. The vision statement guides and tells a company where it wants to be. It guides the company by keeping them focused on the task in hand and also to reach the desired path of success. Formulating an Actionable Integrated Marketing Strategy A strategic marketing plan is to be developed for opening a new showroom in Guildford, United Kingdom. Cowdor stone gallery is a small business unit in Woolmer Green, Hertfordshire in UK. It manufactures and also installs products made of granite and marble kitchen worktops. The business wants to open a sister showroom. For opening a showroom, from 3 different locations that were in contention, Guildford has been chosen as the as the ultimate destination for setting up the showroom. As we have seen an integrated marketing approach should have the following: Market structure and segmentation analysis Targeting and Differentiation approach Scope of doing the business Value capture approach The Cowdor stone group is looking to open a new showroom in the south east of London near the M25 road. Cowdor stone gallery does business in manufacturing and retailing of granite and marble worktops. They have a full manufacturing facility on-site. To undertake an expansion in business Guildford has been identified as a potential location. The location has gained prominence as it suitable with the present business activities and also due to availability of a suitable market in Guildford. The business unit wants to use their existing manufacturing location situated at Woolmer green as the supply location for their business purpose. The main aim and objective for them in looking to open a sister showroom is trying to break even in the month 19 of investing in the expansion of business. Other objectives are to become the top supplier of choice on the worktops market and also generating a Return on Investment of 100% in 4th year of expansion. Guildford is a county town of the second largest county, Surrey in south east of England. Guilford as a location has certain key points of interest like Guildford Business Park, Friary shopping centre and Guildford High Street. It is also a popular shopping and tourist destination. Surry Research Park, University of Surrey, and Guildford Cathedral are all part of interest in Guildford. The Heathrow and Gatwick airports both are located at a relatively nearer location to Guildford. There is also a frequent rail service from London Waterloo Station to Guildford. Guildford borough has a relatively easy link of transportation with the rest of London. Market Structure and Segmentation Analysis The market structure analysis of UK market tells us that in present condition Kitchen worktops are capturing 90% of the entire market where as bathroom worktops are occupying only 10% of the entire UK market. The market size of the kitchen worktops are growing steadily. Between 2000 to 2007, its market value has risen to £190m. It also showed that a decline in the period of 2008-2009 to £180m due to recession in that period. The house building sector also went through contraction therefore it means a reduction in house purchase and also competition of extreme high price. The market forecast shows an expectation of substantial growth in the coming period of 5 years to over £ 200m. In case of bathroom worktops, market size and growth is steadier. During the period of 2000-2007, market value was £1.8m. Like in case of Kitchen worktops the bathroom worktops also showed a decline during the period of 2008-2009 due to recession. The limited growth in case of bathroom worktops is considered to be because of increase in flat purchases compared to that of house purchases. The local Guildford market has a moderate competition as compared to more competition in the surrounding areas. In UK, there are numerous kitchen designers and installers operating, so there is scope of growth by means of partnerships (Carnegie Mellon University, 2003). In the current context, the worktops market has seen a decline in the year of 2009, although market analysts have forecasted a growth in market in the coming years. Here, there is a potential of selling high end products as natural stone which is used in worktops are quite attractive. The competition in Guildford is much moderate compared to the surrounding areas. The advantage of planning to set up a showroom in Guildford is that there is a lack of independent company showrooms in the proximity, so there is a scope for less competition. But the presence of well known retailer, Magnet in town centre which might pose some disadvantage. As far as business trends in UK market are concerned, the kitchen worktops have seen a steady increase in consumer awareness. They decide their choice of product based on design, color and material. So, they want more customised products. The granite has gained popularity among worktops market due to its durability and strength. The customers want more of products made of granite. The attractiveness has also increased. Natural stones, laminates and specially granite have gained the interest of the high end customers. For the segmentation in case of bathroom worktops, in modern times use of second bathrooms has increased the growth of bathroom worktops. Also, ensuit and cloakroom facilities have made a significant contribution in case of growth of the bathroom worktops. The furniture of bathroom has gained increased popularity in modern times. In bathroom worktops also like in kitchen worktops the use of integrated basins, solid surface products and also granite has helped in increasing its popularity among customers. Market segmentation deals with taking into consideration the solution of three interrelated questions like who, what, why? Market segmentation is done by evaluating certain criteria like common needs among the exhibits, sharing of one or more common characteristics among the buyers of the products and the organisation. Market segmentation works similar to the market incentive and also it can be reached with the help of market involvement. Segmentation helps in linking the three parts i.e. who, what, why together thus helping the business to come up with a best possible results and outcome (Moss & Cubed, 2008). In Guildford market, if we segment the customers accordingly, we can see that direct customers who generally walk in to a showroom consist of 30%. They are mainly large employers, higher managerial occupation holder, higher professional occupation holder, and also lower managerial and professional occupations holders as well. Kitchen suppliers consist of remaining 70% of the entire market. They consist of architects, interior designers, and kitchen and bathroom suppliers. Targeting and Differentiation Approach and Scope for Development Targeting approach for a business organization deals with focusing on a particular set of customers. By focusing on them their likings, disliking and choices are kept understood before designing a particular set of products (Jones, S. K., n.d.). The kitchen supplier around the Guildford area is accounted for 70% of the market. The direct customers constitute 30% of the market. The focus age group is 25-64 years. It constitutes of more 50% of Guildford’s population. The area is populated with mainly high income households. They generally like to go for premium products when purchasing their worktops. Therefore, it is quite a fruitful decision to set up a new showroom in this area. The target customers for the business basically include architects, home owners, interior designers, high end customers, kitchen and bathroom planners, builders or construction companies, house letting agencies, shop filters and also related service providers. The budget for setting up a new showroom has been allocated as £ 55,000. The company also looks to generate a profit of £ 115,000 in 4 years. It is developed as a policy to get back 100% return on investment. In Guildford area, the budget required for setting up the showroom is calculated to be around £ 35,000 for Property-1 and also £ 34,500 for Property-2. So, if we analyse that we can find that the startup cost comes up to a figure which is less than the allocated one. The saved budget for other activities will be around £ 20,000. Therefore, from the financial prospective, setting up of the business in the area would be a profitable venture. Here, if we analyse the differentiation benefits that the CSG can provide, e.g. the company mainly focuses on marble, granite, limestone, travertine, slate, terracotta as their main source for making the worktops. The granite in recent times has caught focus of the customers in this segment. The high end customers mainly prefer worktops made of granite. So, by setting up business in Guildford area along with other scope of profit this can also be utilized to generate the 100% return on investment. As far as pricing is concerned, there is not much price differentiation between the offerings of CSG and that of their competitors. The other differentiations for CSG are their technical expertise. They have a strong and knowledgeable team set with skilled employees and requisite machinery for helping them in not only setting up the new showroom but also to maintain their position in market by tackling all competitions and difficulties that may arise in course of time. The setting up of the new showroom will help the customers to see the worktops in the locality. As we have seen that the locality is populated with many high end customers who want quality products, therefore the scope of growth is tremendous in the Guildford area. From the positioning point of view it is seen that Cowdor stone gallery have positioned themselves in the high range criteria. They mainly import quality products from Italy and Spain. The natural stones which they generally use are of high quality. The planning and design along with installation are all under the advantages that CSG poses. The pricing of product can also be balanced according to the target market. The pricing strategy that Cowdor follow at present is of market standard. They can also vary the pricing to keep an edge in the competitive sense. In terms of promotional aspect, word of mouth promotion, B2B strategy of promotion , direct communication, face to face method of meeting with new partners and also by creating a community network can all serve to beneficial terms CSG in this new venture. The budget that will be used in setting up the new showroom is seen as around £ 34,000 -£ 35,000. So, the rest saved budget of around £20,000 can be used in branding budget purpose. Promotional activities like word mouth promotion, face to face meeting with likely partners, promotion by means of using new brochures, creating network with the help of Guildford community can all be done using the saved budget. This process will be a time consuming one but can give the company immediate dividend in their venture of recovering the 100% return on investment within the decided period of 4 years. Although, like in any business here also there will be certain financial constraints which have to be looked into very carefully. Value Capture Approach The value capture or generation approach in integrated marketing solely deals with the ability of the product or brand to create value for the customers. Here, if the new showroom is constructed in the Guildford area it will have certain value generation for customers such as proximity of the showroom for the residents of Surrey and also it is same for the kitchen suppliers. As Guildford area is seen to be populated with high end buyers therefore it is bound to bring more profit to the company. For customers, the setting up of new showroom means scope for more options and choices. From CSG’s perspective, the setting up of the showroom will give them an opportunity to bring in more premium products for the affluent Guildford market. Therefore, it induces more scope of growth and profit. This will also give them a competitive edge over their competitors. The increase in the prospects generating the local business can help the company to become the market leader. Possible Contingencies As we analyse the area of Guildford we can come up with certain contingencies that might arise. Guildford as an area can add certain benefits to the CSG group if they set up their business in that place. The benefits of the place include its quality of life which is high, so, there is a scope of selling their premium products in future. The area has good transport facility, and the area is a popular shopping and business destination. The benefit may arise as the area’s kitchen suppliers and also installers could end up becoming potential clients. The area has seen housing development in recent times. So, there is a certain possibility of getting an increase in demand for the kitchen and bathroom worktops. Although, on a negative side the area has relatively high property and transportation cost which may pose a problem in the efforts of the company of retrieving 100% return on investment in 4 years. Guildford area is located at about 1 hour distance from the present CSG business area. The economic situation of the city will also boost the scope of flourishing the business in the area. The target market is also broad in nature and with no direct threat of competitors, it has the possibility of bring in beneficial opportunities for CSG. As a place Guildford has a high economic productivity. CSG has a scope of negating some disadvantages of the area by reducing the showroom opening time. Thus, they will be able to save money for utilising in the transportation costs. CSG can derive above mentioned possibilities by opening their showroom in Guildford area. Conclusion From the entire discussion it can be observed that Guildford is an attractive market proposition with very high potential for growth. Therefore, if CSG sets up their new showroom in this area it will mainly bring in scope of improvement in the near future. References California State University, No Date. Integrated Marketing Plans. University Communications. [Online] Available at: http://www.csufresno.edu/plan/documents/integrated_marketing_plan_2005.pdf [Accessed May 16, 2010]. Carnegie Mellon University, 2003. Principles Of Marketing: Market Segmentation, Targeting, And Positioning For Competitive Advantage. BNET. [Online] Available at: http://jobfunctions.bnet.com/abstract.aspx?docid=79879 [Accessed May 16, 2010]. Jones, S. K., No Date. Creative Strategy in Integrated Marketing Communications. Direct Marketing Association. [Online] Available at: http://www.the-dma.org/dmef/researchsummit/HandoutCreative.pdf [Accessed May 16, 2010]. Ebren, F., 2006. 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