Custom Marketing Plan - Coursework Example

A. Mission ment To produce and sell top quality want-satisfying electronic appliances to our s thereby creating value and to build longterm cordial relationships. To reap monetary profits and ensure financial gains for Company G in long run through continuous business expansion and growth in both domestic and foreign markets by focusing on innovation, diversification, product and market development strategies. B. Market objectives Target market: The company G is capable of producing and selling premium quality electronic appliances for its potential customers from its state-of-the-art production plants. The manufacturer will target lower-middle, middle-middle, upper-middle and elite households across USA that require small electronic appliances such as Juicers, Toasters, Heaters, Sandwich maker, Microwave Ovens, Bedroom Fridges and Freezers, Dispensers etc. for their routine use. The company will target the above mentioned market segments and is quite hopeful that sales growth will be observed. The individualistic culture in USA (or absence of extended / joint family system) has increased the total number of households. Indeed, over 80% US population lives in urban areas where live is fast and people require small electronic appliances, which are categorized under necessities. Hence, the demand of electronic appliances is extremely higher because of better purchasing power of people in urban areas (indexmundi.com). For instance, Median household income in USA is above $76,000 per annum; hence this shows the ability of consumers to buy appliances. In addition, people in USA have an inclination towards products that ease their life thus huge demand of environment-friendly electronic appliances exists in USA (srds.com). Marketing Objectives: 1) To produce and offer want-satisfying top quality electronic appliances to our potential consumers and to focus on value addition for segments with higher purchasing power. The sales would be increased by 200% in first 3 years. 2) To charge rational prices in order to attract lower-middle and middle-middle groups while charging higher prices for value-added products from other two segments. 3) To ensure that our customers receive ‘Utility of Place’ and ‘Utility of Time’ through efficiency supply chain and transportation networks. Special attention will be paid to avoid any artificial and unnecessary shortages in the market to maintain consumer confidence. 4) To enter in market with aggressive marketing and advertising strategies through use of informative and persuasive advertising tactics. Electronic, Print, Radio and Internet Media will be used for promotion. Sales discounts will also be offered to entice potential wholesalers, retailers and end-users. Push and Pull Marketing strategies will also be adopted to ensure sales growth. C. Competitive Situation Analysis Product Classification: Shopping Products: The electronic appliances such as Juicers, Toasters, Heaters, Sandwich maker, Microwave Ovens, Bedroom Fridges / Freezers and Dispensers fall in the category of Shopping products because they require comparison shopping and cost more than convenience products. Indeed, they can not be supplied at various convenience stores where products of routine use (soaps, shampoos, food stuff and many others) are available. Instead, products will be available at different electronic appliances stores, in-town and out-of-town supermarkets and will be differentiated in comparison to available rival brands in the marketplace. The products are not specialty or luxury products because they are necessities that are demanded by every household. Porter’s Five Forces model: Bargaining Power of Buyers: The bargaining power of customers is higher because consumers demand more value for the money they spend in the market. They demand higher quality products at relatively lower prices. Company G will also have to adopt a rational pricing strategy to lure customers. Bargaining Power of Suppliers: The bargaining power of suppliers (raw material providers such as plastics, steel, compressors, machinery, etc) is reduced because of decrease in overall US consumption after worst economic recession of 2008-2009. The decrease in demand by manufacturers has also forced suppliers to amend their strategies. Potential New Entrants: The steep fall in aggregate demand has compelled interested parties to avoid entering and investing in manufacturing-related businesses. Our company should also accept the fact that threat of new entrants is relatively low. Threats of Substitute Products: The threat of substitute products is relatively higher because existing manufacturers could introduce their new line of products to attract customers and increase their market share. In addition, importers can also introduce new products and comparatively cheap products originally manufactured in China and Malaysia against our new market offerings. Price factor will play extremely important role in contemporary economic conditions. Rivalry Among Competitors: It is worthwhile to mention the fact that rivalry among customers would be higher because of any expected price-wars and new product offerings in today’s challenging business environment. Differentiation and Positioning followed by aggressive advertising will play a vital role in our success. D. SWOT analysis Strengths as Core Competences: 1) The new product line will focus on value added consumer products for upper-middle and elite groups. State-of-the-art machinery and updated production facilities will enable manufacturing of top quality small electronic appliances that in turn will provide a competitive advantage to Company G over its rivals. 2) The market prices charged (as per new plan) for different products will be lower than industry average. Indeed, the reason behind it is the fact that higher productive capacity from new plants in Company G will reduce production time and ensure very little raw materials’ waste. Cost efficiency will also be observed that in turn enable the manufacturer to offer low priced appliances to potential customers. 3) New Products are very environment friendly because they will be produced by using latest renewable technology from Company G’s state-of-the-art production plant. Weaknesses: 1) Current suppliers are unable to provide raw materials for new production line. Hence, the company may not observe any real benefit even if it enjoys cordial relationships with existing suppliers. 2) Lack of highly professional marketers and sales personnel who could develop effective marketing strategies and push Company G’s products in the market respectively. Substandard past performance is an open evidence of above mentioned weakness. 3) Company G will require significant time to find reliable and cost-effective new raw material providers for its products. In case the company fails to locate and negotiate with suppliers, its production will be negatively impacted. Opportunities: 1) Improvement in global economic conditions, especially in US market, will help carrying our production and sales operations. Consumer spending is expected to increase in 2010 – 2011. 2) Growth in emerging markets is directly linked with growth in advance economies because of increase in trade and commerce. Hence, it can be concluded that Company G could also export its products to developing economies in Asia (China, India, Malaysia, Indonesia, Thailand etc), Central and Eastern Europe (Turkey, Hungary, Chile etc) 3) The upcoming closures of failed producers will also reduce competition and provide an opportunity to increase our market share. Threats: 1) Economic downturn and financial crises has massively reduced consumer spending and demand of electronic appliances in the world. 2) High labor costs in USA reduce the cost-efficiency against Chinese, Malaysian and other developing nations’ products as offered by importers. 3) Absence of subsidies and higher corporate taxes as imposed by US government is noxious for growth of electronics manufacturing industry in USA. The cheap and acceptable quality imported products are forcing US producers to leave this industry. E. Marketing strategies Product strategies: 1) In phase 1, major new small electronic appliances such as Juicers, Electronic Toasters, Heaters and Sandwich Makers will be launched and targeted to only Lower-middle and Middle-middle segments. 2) In phase 2 after evaluating the response from previously launched new small products, the marketers and strategic planners will decide to offer branded and value-added products to Upper-Middle and Elite classes. 3) In phase 3, the remaining products such as Microwave Ovens, Bedroom Fridges / Freezers and Dispensers will be launched and targeted to all mentioned targeted groups. Price Strategies: 1) The introductory prices will be on no-profit no-loss basis (breakeven) on products offered to lower-middle and middle-middle groups. Indeed, this will be an attempt to entice customers and trigger maximum purchase responses during phase 1. 2) During phase 2, the company will charge relatively higher prices on branded and value-added products offered to Upper-middle and Elite classes. However, the prices for brands will still be lower against existing competitors’ brands in the marketplace. 3) The prices of already launched products in Phase 1 will be increased to a reasonable level, yet they will be kept lower than average industry prices because of costs savings from efficient production sites. Indeed, reasonable prices (but lower against rival products) will be charged for Phase 3 products; however, breakeven policy will not be adopted this time due to expected consumer acceptance of Company G’s products. Promotion Strategies: 1) Company G will use television, newspapers, magazines, websites, online digital communities such as Face Book and Twitter followed by use of Radio media to inform customers about the new arrivals. 2) The company will use aggressive informative and persuasive advertising techniques to attract maximum customers towards its brands. Finally, as part of its Push strategy, the company will offer bulk sales discounts, membership and loyalty cards to its distribution channel members such as dealers, wholesalers and retailers who will persuade customers to buy our products. 3) In addition, the company will sign agreements with celebrities and famous personalities to become our brand ambassadors. Feedback will also be received from customers, on the basis of which, the marketers will interact with customers and make decisions for further improvement. The company will also offer its products at famous supermarkets such as Walmart, Trader Joe’s etc to increase its market reach. Distribution strategies: 1) Dealers and distribution partners will be communicated through an efficient Online Networking System where every customer could place its orders in any quantity. 2) The company will form an agreement with a transportation services provider to ensure smooth and timely delivery of our electronic products to all across USA. 3) The bulk orders (by authorized channel partners) will then be delivered using our transport system. The marketers will make sure that no delivery shortages are observed (Utility of Place) and buyers receive would receive timely deliveries. The aforementioned ‘marketing mix’ is the best mix because it aims to achieve organizational goals and growth targets. In addition, the discussed strategies would prove to be successful because the company will focus on value addition, branding, differentiation, aggressive advertising, market and product development and innovation. In contrast, the company did not pay any real attention to these mentioned areas in past. F. Tactics / action plan and Monetary Activities: Indeed, this is a three yearly (2010 – 2013) plan that will be implemented from August 1, 2010. Product Action Plan Strategy 1: Action/Tactic: launch of total 3,000 units of each Phase 1 product in the open wholesale market and at various supermarkets. Due Date: August 5, 2010 Responsible Party: Product Manager Budget (cost): $3 million Strategy 2: Action/Tactic: launch of total 1,500 units of each Phase 2 product in the open wholesale market and at various supermarkets under different brand names. Due Date: February 5, 2011 Responsible Party: Brand Manager Budget (cost): $2 million Strategy 3: Action/Tactic: launch of total 1,500 units of each Phase 3 product in the open wholesale market and at various supermarkets under company name for lower- and middle-middle segments and different brand names for elite classes. Due Date: August 5, 2011 Responsible Parties: Product and Brand Managers Budget (cost): $6 million Monitoring Activity: Per Store and Area Sales will be monitored by Marketing Director every two months and report will be submitted to CEO of the company about performance. When/Frequency: Every two months Responsible Party: Marketing Director Price Action Plan Strategy 1: Action/Tactic: Analyzing our per unit costs and then charge minimal prices to ensure breakeven. Due Date: August 5, 2010 Responsible Party: Product and Finance Manager Budget (cost): Strategy 2: Action/Tactic: Analyze going brand prices in market and then charge 15% lower prices on branded Phase 2 products. Due Date: February 5, 2011 Responsible Party: Brand Manager Budget (cost): Strategy 3: Action/Tactic: Increase prices of Phase 1 products and charge reasonable prices for Phase 3 new products at the time of launch. Due Date: March 1, 2011 and August 5, 2011 Responsible Party: Product, Brand and Finance Managers Budget (cost): Monitoring Activity: The Marketing Director will monitor the impact of lower prices on sales and will decide whether to change going market prices. Higher sales from low prices will result in price stagnation for Phase 1 and Phase 2 products while Prices may be lowered if sales do not pick up of Phase 3 products. When/Frequency: Every two months Responsible Party: Marketing Director Promotion Action Plan Strategy 1: Action/Tactic: Launch of introductory advertisements on all chosen media about Phase 1,2 and 3 products followed by persuasive advertisements Due Date: August 2, 2010 January 15, 2011 July 15, 2011 Responsible Party: Advertising Manager Budget (cost): Strategy 2: Action/Tactic: Launching membership / loyalty cards and offering sales incentives to all chosen dealers and distribution channel members. Due Date: July 25, 2010 Responsible Party: Sales Manager Budget (cost): Strategy 3: Action/Tactic: Celebrities and players will be contacted to form marketing agreements Due Date: September 1, 2010 Responsible Party: Industrial Relations Manager Budget (cost): Monitoring Activity: The Marketing Director will monitor the impact t of aggressive advertising on sales growth. Will propose improvements while highlight any weaknesses in existing media campaigns. When/Frequency: Monthly Responsible Party: Marketing Director Distribution Action Plan Strategy 1: Action/Tactic: An IT company or software developer will be contacted for preparation of Information System upon the specified functional and technical requirements Due Date: June 15, 2010 Responsible Party: IT Director Budget (cost): $ 15,000 Strategy 2: Action/Tactic: Narrow the list of transporters and Contract with the company that will meet company transport requirements Due Date: July 25, 2010 Responsible Party: Supply Chain Manager Budget (cost): Strategy 3: Action/Tactic: Bulk production will be ensured to transport orders in bulk amounts. Due Date: August 1, 2010 Responsible Party: Production, Sales and Supply Chain Manager Budget (cost): Monitoring Activity: The Head of Sales and Marketing Department will monitor the transportation activity of orders and will identify most profitable routes and areas after evaluation and performance appraisal. Marketing strategies will then amended in the light of reports from responsible parties. When/Frequency: Monthly Responsible Party: Sales and Marketing Director References: No author. “United States Demographics Profile 2010” Available at http://www.indexmundi.com/united_states/demographics_profile.html No author “Demographics USA 2010” Available at http://www.srds.com/mediakits/us_weekly/demographics.html Read More