Developing a Marketing for ABC Pharmacy - Business Plan Example

Sales and marketing of Introduction Product and service offerings The paper aims at developing marketing planfor ABC Pharmacy that sells medicines at a comparatively low cost. The pharmacy aims at reducing overall operational cost thereby selling medicines and prescriptions at a discounted price. The primary target segment of the business will be individuals who pay themselves instead of medical insurances for the prescribed drugs. The pharmacy will not be accepting insurance payment as it complicates the accounting process. Primarily the business will be operated from a single store and depending upon the growth and demand, more stores will be lined up in future. In context of the products of the pharmacy, it is noteworthy that only high quality products will be sold at a reduced cost. Many consumers may have the perception that medicines sold at low cost are inferior in quality but the pharmacy will be implementing economical pricing because of two reasons. Firstly, medicines bear high profit margin and secondly, the company will be reducing its net operating cost. Therefore, even at low cost, the venture will be profitable. The pharmacy will offer wide variety including generic as well as named brands of medicines to consumers. Additionally, the services of the pharmacy include mail order as well as in-store selling. Another important factor that has been taken into consideration by the company for developing operative competitiveness is that a large number of people buy same medicine repetitively. Therefore, if such medicines are purchased in bulk, the company will be able to avail bulk discount on the same. Marketing message A marketing message is defined as the information that an organization conveys through various promotional measures to its consumers. The marketing message of ABC Pharmacy is to deliver quality product in a cost effective manner. It is expected that the above mentioned marketing message will have a positive impact on consumers. The marketing strategy of the company can be interpreted in two manners. The possibilities comprise negative as well as positive presumptions. On negative front, consumer may have pessimistic perception about the store and its products. It can be suggested from the perspective of human psychology that low cost products are mostly perceived as of inferior quality (Cravens & Piercy, 2008). However, positive perception will reflect operational efficiency of the company and a consumer centric approach in business activities. If the company is able to nurture and highlight this perception in its marketing strategies and message, then it may boost the sales of the company. A consistent marketing message should be considered as one of the cornerstones of marketing strategies of a successful business. The marketing message of the company should focus on convincing consumers about the cost they would be saving by purchasing from the pharmacy over other online and local pharmacies. Another important fact that should be considered regarding the message is that it should be communicated in such a manner that the negative perceptions of consumers regarding the company and products are easily resolved. Communication of marketing message There are different ways of communicating marketing message but not every measure is appropriate for a particular product, service or business. The marketing mix is defined by four Ps namely, product, price, place and promotion. Promotion mainly reflects the process of message communication to consumers. Various communication measures that are implemented by firms include, above and below the line advertising, packaging, point of sale promotion, e-marketing and branding (Fill, 2002; Burnett & Moriarty, 1998). Since ABC pharmacy is a new store compared to other local pharmacies, gaining market recognition should be the prime motive for the company. The company should focus on increasing awareness of its target market about the existence of the store. Besides increasing store awareness, the strategy of the company regarding sales and communication of marketing message should be based on building long term relationship with the consumers. Initially, the store promotion will be done through brochures followed by advertisement through local news paper and television channels (Fill, 2002; Schultz, 1992). The brochure will be created while emphasizing greatly on communication of the marketing message. It will convey information that reflects the credibility and reliability on behalf of the pharmacy. Consumers generally do not purchase medicine from a store unless it is reliable. The advertising should involve various creative factors that stimulate consumers’ interest in the pharmacy. These factors should highlight low cost products, in-house experienced physician and efficient services such as mail order delivery. The low cost agenda of the company can be reflected in its packaging as well. For instance, the company can use low cost recyclable paper bags for delivery purposes (Hart & Johnson, 1999). Viability of the marketing strategy of the pharmacy in context of the industry The marketing strategy of the pharmacy primarily focuses on relationship marketing along with above and below the line advertising. Relationship marketing is considered very important for service providing businesses such as pharmacy. One of the important aspects of relationship marketing is one to one marketing. One to one marketing is a little different from traditional marketing methods where mass consumers are targeted. In this marketing strategy, the pharmacy operator (s) will be able to pay greater attention to a particular consumer resulting to development of long term business relationship (Hart & Johnson, 1999; Hunt & Morgan, 1994). Relationship marketing is very useful for retaining existing patients as well as developing new consumer base. The reason is that relationship marketing helps consumers take efforts such as word of mouth marketing and peer referral for bringing new consumers. Once a strong consumer base is created, the company can organize events such as diabetes awareness program, blood pressure screening and vaccination program so that greater number of new consumers can be attracted. Relationship marketing is considered an appropriate marketing strategy for pharmacies and pharmaceutical companies because the products they manufacture and/or sell are highly sensitive in nature and generally not bought by consumers unless they can completely trust the manufacturers and sellers (Hart & Johnson, 1999). Additionally, the pharmacy will be able to convince its consumers that, unlike other sellers the company is not aiming at earning profit but also taking initiatives so that greater number of consumers can be served at a lesser cost. For emphasizing on relationship building with consumers, the store has its in-house physician as well so that over the counter drug buyers do not feel disappointed regarding the medicine they are buying. The pharmacy will be incorporating sufficient relation building strategies in their business activities so that greater numbers of consumers are attracted (Hart & Johnson, 1999; Fill, 2002). Communication vehicles of the pharmacy and its effectiveness Customer relationship management (CRM) has gained a great degree of importance in recent years among various companies all over the world. For survival in the competitive market, relationship marketing is being considered as an appropriate tool by corporate houses and industries. CRM is increasingly gaining importance as a relation building tool because it implements different methods in this regard and improves the scope of repurchasing habit among consumers. CRM ensures that right offer is delivered to consumers through right price and right product at right time using right communication channels. The primary focus of CRM in the pharmacy is to acquire, maintain and encourage consumers to consume more products and services therein. CRM can be communicated through different tools of marketing. Some of these significant tools include advertising, sales promotion, personal selling, sponsorship, direct marketing and public relation (Knox, et al., 2007). The pharmacy will be employing integrated marketing communication (IMC) package for aligning and coordinating different communication activities at various consumers touch points for accomplishing its goals. The primary advantage of implementing IMC in CRM is that it ensures synergy among various elements of communication and has a positive role in developing brand image of a company. Since digital revolution has a great impact on marketing communication elements, the pharmacy is planning to take advantages of online marketing through the internet (Keller, 2001; Kitchen & Burgmann, 2004; Knox, et al., 2007). The evolution of CRM can be categorized in three phases namely, customer acquisition, customer retention and customer development. In each stage, different communication tools are applicable for enhancing its effectiveness. Customer acquisition is considered as the most important part of CRM as it results in increase in profit and growth in market share. The communication measure that is generally implemented in the acquisition phase is advertising. Advertising is considered appropriate because creation of brand awareness is best achieved through mass media (Knox, et al., 2007; Corstjens, 1991). Customer retention is important for a firm because a strong consumer base cannot be developed without retention of existing consumers. Keeping in view consumer needs, the most appropriate strategy for consumer retention is direct marketing. Under direct marketing, various loyalty programs can be offered at the pharmacy as well as services such as customized orders and complaint management can be undertaken. For customer retention, customer satisfaction is very important and for this purpose, the pharmacy can install a feedback mechanism in the store (Knox, et al., 2007; Maine, 1998; Holdford & Yom, 2003). Customer development focuses on increasing selling to a company’s current consumers. For enhancing buying behavior of consumers, various promotional measures are undertaken in this phase. Besides normal purchasing amount, selling extra to consumers is the prime motive of customer development phase. The pharmacy can provide extra discount on bulk buying to its consumers at this phase (Knox, et al., 2007; Schultz, 1992). Marketing schedule Weeks Marketing phase Marketing strategy Activities Week 1 Consumer awareness Consumer awareness can be developed with product positioning in such as manner that it is noticed by consumers. Selecting appropriate location for the drug store (pharmacy). Preferable choices would include marketplace, society and other public places. Week 2-3 Consumer awareness The next step is to make consumer aware of the existence of the store in terms of physical evidence. Printing and distribution of brochures that contains address of store and details of differentiating factors. Week 4 Consumer attraction Consumer awareness is not sufficient in a marketing program unless consumer purchase products and contribute towards revenue The pharmacy will be advertising about the store and their low cost medicines through radio, internet, newspaper and local television channels. Week 5-7 Consumer acquisition Consumer attraction is a short term process while consumer acquisition is considered as a long term process. Mass media is one of the best methods of customer acquisition. Advertisement in newspapers can be considered appropriate. Week 8-12 Customer development Customer development is necessary for having strong base of potential and existing consumers can be done through various events Customer development can be done through diabetes awareness program, vaccination program, free health check-ups and blood donation camps. Week 13 and onwards Customer retention Customer acquisition is considered more expensive than retention of the same and for this purpose, relationship marketing can be considered suitable Relationship marketing includes home delivery, loyalty programs, personal selling and so on and so forth. Marketing budget In the following table, yearly expenses related marketing activities in the pharmacy has been presented. Marketing activities Budget Brochure advertising $1200 Television advertising $5000 Newspaper advertising $2000 In store promotion (purchasing point discount and bulk purchase discount) $500 Radio advertising $1000 Direct marketing and personal selling $4000 Online marketing $2500 Event promotion $5000 Total $21200 Brochures and advertisement References Burnett, J. & Moriarty, S. E. (1998). Introduction to marketing communication: an integrated approach. Upper Saddle River, NJ: Prentice Hall. Corstjens, M. (1991). Marketing strategy in the pharmaceutical industry. London: Chapman & Hall. Cravens, D. & Piercy, N. F. (2008). Strategic marketing. New York: McGraw-Hill Irwin. Fill, C. (2002). Marketing communications: contexts, strategies and applications. UK: Prentice Hall. Hart, C. W. & Johnson, M. D. (1999). Growing the trust relationship. Marketing Management, 8(1), 8-19. Holdford, D. & Yom, S. H. (2003). Content analysis of newspaper advertising of pharmacy services. Journal of Pharmaceutical Marketing & Management, 15(2), 81-96. Hunt, S. D. & Morgan, R. M. (1994). Relationship marketing in the era of network competition. Marketing Management, 3(1), 19-28. Keller, K. L. (2001). Building customer-based brand equity. Marketing management, 10(2), 14-21. Kitchen, P. J. & Burgmann, I. (2004). Integrated marketing communication. New Jersey: John Wiley & Sons, Ltd. Knox, S., Payne, A., Ryals, L., Maklan, S. & Peppard, J. (2007). Customer relationship management. London: Routledge. Maine, L. L. (1998). Direct-to-consumer advertising: A pharmacy perspective. Clinical therapeutics, 20, C104-C110. Schultz, D. E. (1992). Integrated marketing communications. Journal of Promotion Management, 1(1), 99-104. Read More