Marketing Management - Business Plan Example

Marketing Management Table of Contents Table of Contents 2 Project Outline 4 1. The nature of the project: 4 2. The sources of information used during the marketing plan 4 1.3. The most important concepts and techniques to be applied 5 2. Final Project 6 2.1. Situation Analysis 6 2.2. Target Audience 6 2.3. Goals of the marketing plan 7 2.4. Strategies and Tactics of the marketing plan of Zenta Tech 8 Market need recognition 8 Internal company analysis 8 Assessment of the substitute products 9 Selection of a distribution channel 9 Proposal of effective communication or advertising channels 10 Establishment of the price point 10 2.5. Budget Breakdown 12 Reference List 13 Appendix 15 1. Project Outline 1.1. The nature of the project: Current project is a marketing plan for a software producing company ‘Zenta Tech’. The firm is a SME based in the Silicon Valley area of USA. The firm is offering low cost commercial statistical software, which is mainly used in market surveys. They are having moderate amount of corporate customers in the California area. However, they are facing intense challenge from the global leaders or the technological and economical factors. ‘Zenta Tech’ was facing huge competition in USA software industry as they are having lower diversity of products portfolio. In this marketing plan ‘Zenta Tech’ will develop new software named ‘Merkstat’ will be developed. The study will be aimed to prepare marketing analysis report for the new software product (Adcock, 2010). 1.2. The sources of information used during the marketing plan Current marketing plan for ‘Merkstat’ requires proper data collection methods. The report will be collecting data from different sources to emphasize on the USA based software market. Current marketing plan will be using most recent data for developing competency of ‘Merkstat’. Contemporary market data can be collected from different sources like; web traffic analytics portals, web searching portals, most recent journals on the USA software market and social media portals. Web traffic analytics portals are providing the statistical analysis software which can be used to obtain an in-depth idea on the USA based software industry. This source will be providing graphical representations of the changes in the customer demands along with the time and technological development. Web searching portals are the largest source of information according to the USA based software market (Beamish and Ashford, 2012). This source is providing the largest source of data for the USA based software industry. These portals are providing huge database with contemporary statistics. Moreover, in the current marketing report of ‘Merkstat’, these portals will provide high quality secondary data. Journals regarding the USA software market provides secondary data source for developing marketing plan report. On the other hand, social media portals are providing most contemporary data of the customer choice, expectations, perceptions and future expectation. Recently, major number of people is using social media for communicating. Thus, social media survey will be providing primary data on the customer’s expectation and perception regarding the statistical software. Research will increase more quality with the help of primary data (Kotler, Keller and Brady, 2009). 1.3. The most important concepts and techniques to be applied Firstly, the market project will be developing market identification strategies for Merkstat. Marketing managers of Zenta Tech need to develop different strategies to identify their target market for the new software in the USA or Silicon Valley area. Then, Zenta Tech is required to set proper price point for the new product. Competitive pricing policies will be selected for the software Merkstat. After selecting the pricing point, Zenta Tec marketing team need to select the distribution channel for the product (Beamish and Ashford, 2012). Distribution channel will play a crucial role in the growth and sustainability of the new software. Zenta Tech is going to select the online distribution channel of their new products. It will be selecting different strategies for selecting communication or advertising channels. Finally, the marketing managers will be selecting the potential buyers of the Merkstat statistical software. 2. Final Project Current marketing report will be prepared on behalf of marketing managers of Zenta Tech. This report will be aimed to develop market development strategies for the Merkstat. Zenta Tech produces software in the Silicon Valley area supporting different statistical analysis. Research and Development department of the different organizations, statutory bodies and third party marketing agents will be using these types of software for making market survey. In the current section the various strategies are outlined for Zenta Tech so that they can promote their new product Merkstat (Aaker, 2010). 2.1. Situation Analysis Zenta Tech is planning to introduce market research analytical software for SME and large scale organizations. The organization is planning to expand their market share with the help of Merkstat software. Zenta Tech is operating in Silicon Valley area and facing huge competition from many other software vendors. Therefore, they are planning to reach global customers to increase growth and profitability. Zenta Tech marketing managers are adopting different process to identify the potential market (Boone and Kurtz, 2012). 2.2. Target Audience Potential buyers of the Zenta Tech are mainly the market analysts. Mainly, the analysts will be making market research on the buying behavior of the customers. Thus, Merkstat will be gathering the contemporary action of the buyers and market. This will help the users to forecast future purchase trends. Merkstat will be making the survey on behalf of the clients, on the various common people to gather information from the use of credit cards and bank cards (Mohammed and Rashid, 2012). Zenta Tech offers high privacy concerns to meet the allocation of the various factors. Merkstat is able to predict the future trend 95 percent accurately. On the other hand, this software provides very fast data analysis to provide market trend for the next 30 days. Thus, it can be said that the feasible market segmentation, marketing channel and target market selection will aid the Zenta Tech in obtaining sound growth and sustainability for their new product. Merkstat software is new products so Zenta Tech needs to create intensive marketing strategies for the product. The firm is aiming to meet at least 100 customers during the first two months of set up. In addition, they are also planning to increase overall customers range to 1000 in the nest 9 to 12 months. 2.3. Goals of the marketing plan The marketing plan will be developed by emphasizing the following goals. Develop the brief of solutions Zenta Tech is defining their target market with the help of key understanding on the analytical or market research solutions they are providing. In addition, potential customer outlining will be helping market identification potentials. Potential customer identification Potential customers must be identified to develop feasible marketing strategies. Mainly, the market research organizations will be the potential customer of Merkstat software (Loudon, 2011). Beneficiary of the marketing plan or the software product In the market identification process, Zenta Tech managers are developing the idea on the beneficiary of the marketing plan development. Moreover, the use of the analytical software must be outlined. Marketing managers are investigating on the usefulness of the software. Managers are outlining the efficiency of market study by using the software (Ballantyne and Aitken, 2007). 2.4. Strategies and Tactics of the marketing plan of Zenta Tech Market need recognition Zenta Tech is recognizing the need and expectation of the niche market consumers. Expectation of the market analysts is a software having lots of statistical programs to show the graphical output of the market trend. Thus, Merkstat market identification also involves the US statistical software market analysis for outlining the customer behaviors. Internal company analysis Zenta Tech marketing managers are assessing the strengths and weakness of the firms. They are assessing the efficiency of their own organization in terms of meeting the global customers’ demands (Kotler and Keller, 2011). This process is assessing the skill set and experience of the employees, technical power, and exclusive information about the potential geographical area. Moreover, marketing managers are developing learning and appraisal policy for the employees to increase their efficiency and motivation. Assessment of the substitute products While identifying the market, marketing managers are evaluating the features of the supplementary products. In the USA, there are several other software vendors providing similar type of statistical software. Thus, marketing managers are analyzing the marketplaces to forecast the profitability (Luther, 2011). However, in the competitive market, Zenta Tech will be facing the risk of getting substituted. In the American software industry, Merkstat will be facing the huge challenge from substitute software. From the above strategies it can be said that Zenta Tech will be facing some complexity in identifying their target market for the new product Merkstat. Marketing managers of the firm are planning to target the SME firms, third party market analysts and large scale firms in the US regions (Brownlie, 2007). Selection of a distribution channel Selection of distribution channel is one of the crucial strategies of developing marketing plans. In the contemporary era, the software markets are utilizing the E-commerce channel to reach more customers in the USA market. This policy will aid Zenta Tech to reduce cost of operating; it will increase the CRM and post sales service. Customers can use the demo of the software for 10days and able to subscribe Merkstat for more use. This process will increase the customer satisfaction and acceptability. Proposal of effective communication or advertising channels Zenta Tech is planning to promote Merkstat via the social, digital and mobile channels. Social media and mobile media are increasing the popularity among the different type of customers. Zenta Tech is able to reach huge number of people around the US region. Mobile marketing policy will be using the smartphones, whereas digital marketing policy uses computers to reach the potential customers (Woodruff, 2010). Establishment of the price point Pricing is one of the majorly important strategies for Zenta Tech marketing management. There are various options for the organization to set their pricing point in the US based software market. Zenta Tech will be having the options of the premium pricing, penetration pricing, economy pricing, price skimming and psychological pricing for the Merkstat products. However, competitions and sustainability are impacting the pricing policies. The USA software market faces stiff competition, so penetration pricing policy selection will increase potential of gaining customer attraction in the UK market (Bendapudi and Leone, 2008). Zenta Tech uses penetration pricing technique for their new product Merkstat. This technique will influence marketing managers of the organization in setting up comparatively low market entry price. Moreover, this type of price is lower than conventional pricing point set by the other organizations. This pricing policy will help Zenta Tech to attract new customers from the USA software market with the lower price (Greenley and Bayus, 2007). Penetration pricing is highly used by the organizations in terms of introducing new products, penetrating in a new market and developing existing products. This type of pricing policy helps the organizations to achieve the marketing objectives. Zenta Tech will be able to increase market share in the USA software market with the help of increasing sales volume. However, penetration pricing will provide comparatively lower profits as the price point is quite lower (Mohammed and Rashid, 2012). Globalised organizations are suing the penetration pricing policy in terms of launching a new product. This will help them to meet the competitive market. This type of pricing policy will help Zenta Tech in terms of entering into the global or unexplored part of the USA. Zenta Tech is facing the issues in the USA market like very low software product differentiation. Moreover, Zenta Tech is facing the challenge of demand as per price elastic nature. Basic concept of the pricing policy of Zenta Tech is keeping high contrast with the rival products in a competitive manner (Farahmand, 2011). Zenta Tech will be enjoying different advantages for using the penetration pricing. They will be able to take part in the competition shocking the competitors and marketers. Word-of-mouth recommendations are highly observed due to such pricing policies. Satisfied customers with the attractive pricing margins will promote Zenta Tech among their family and friends. In addition, while using penetration pricing policy software vendors have to reduce the production or unit costs. Thus, Zenta Tech management will be regenerating the operations process from the very beginning. Low price policy of the Zenta Tech will be creating a barrier for the new entry and the other potential competitors offering same market research analytical software (Lim and Lusch, 2011). However, penetration policy has certain limitations which reduce the scope of growth and sustainability of Zenta Tech. This policy initially sets low price offering which develops customer’s expectation of low prices of the Merkstat for the long-term. Zenta Tech will face huge problem while increasing the prices of product in the future. Penetration pricing will attract frequent customers, this types pricing policy will affect the loyalty status among the customers and they will reduce the scope of growth. In addition, penetrative pricing will harm the brand image development of Zenta Tech (Patel, 2011). 2.5. Budget Breakdown Prices of different service segment of the Merkstat Service Price £ Web based research 8500 Conventional media research 4500 Search engine optimization 5000 Entry level packages 14000 Full market research per day 100 Full market research per month 2000 The marketing plan also develops cost and budgets for the new products Merkstat. Budgeting statistics are outlined in appendix part of the assignment. It is observed that the firm Zenta Tech will be facing certain complexity in achieving the growth in the market. Profit for the year 2014 reported as 2580. On the other hand, forecasted profit and loss reported fluctuation as it reports 1450 in the year 2015, 915 in the year 2016, 1415 (2017), 1204 (2018) and 2665 (2019). Reference List Aaker, D., 2010. Strategic Market Management: Global Perspectives. 6th ed. Oxford: Blackwell Publishing. Adcock, D., 2010. Marketing: Principles and practice. 4th ed. London, Thousand Oaks CA: Sage Publication. Ballantyne, D. and Aitken, R., 2007. Branding in B2B markets: insights from the service-dominant logic of marketing, Journal of Business & Industrial Marketing, 22(6), pp.363 - 371 Beamish, K. and Ashford, R., 2012. CIM Course book 07/08 Marketing Planning. 3rd ed. New York: Free Press. Bendapudi, N. and Leone, R. P., 2008. Psychological Implications of Customer Participation in Co-Production, Journal of Marketing, 67, pp.14–28. Boone, L. E. and Kurtz, D. L., 2012. Contemporary Marketing. Page 84. 7th ed. New York: Kaplan Publishing. Brownlie, D., 2007. Marketing Audits and Auditing: Diagnosis through Intervention. Journal of Marketing Management, 12, pp.99-112. Farahmand, N. F., 2011. Organizational marketing planning by management educated managers, African Journal of Marketing Management 3(8), pp. 178-187 Greenley, G.E. and Bayus, B.L., 2007. Marketing planning decision making in UK and US companies: an empirical study, Journal of Marketing Management, 9, pp.155-72. Kotler, P., and Keller, K. L., 2011. Marketing Management (Global Edition). 14th ed. Harlow, Essex: Pearson Education Limited. Kotler, P., Keller, K. and Brady, M., 2009. Marketing Management. 6th ed. London, New York: Person Education Lim, S. C. and Lusch, R. F., 2011. Sales margin and margin capitalization rates: linking marketing activities to shareholder value. Journal of the Academy of Marketing Science, 39(5), pp.647-663 Loudon, D., 2011. Marketing Management: Text and Cases. 6th ed. London: Prentice Hall. Luther, W. M., 2011. The Marketing Plan: How to Prepare and Implement It. 6th ed. Oxford: Blackwell Publishing. Mohammed, A. A. and Rashid, R., 2012. Customer Relationship Management (CRM) in Hotel Industry: A framework Proposal on the Relationship among CRM Dimensions, Marketing Capabilities and Hotel Performance. International Review of Management and Marketing, 2(4), pp.220-230 Patel, P.C., 2011. Role of manufacturing flexibility in managing duality of formalization and environmental uncertainty in emerging firms. Journal of Operations Management, 29 (1–2), pp.143–162. Woodruff, R.B., 2010. Customer Value: The Next Source for Competitive Advantage. Journal of the Academy of Marketing Sciences, 25(2), pp.139-154 Appendix Projected income statement of the Merkstat for the year 2014-15: Particulars Details Amount Per hour (£) Raw material 12000 120 Cost of maintenance 5000 50 Prime cost 17000 170 Office and administrative overhead Office Rent 900 9 Depreciation 40 0.4 Other general expenses 180 1.8 Total office and administrative overhead 1120 11.2 Cost of service de 18120 181.2 Selling and distribution overhead of new set up Advertisement expenses 950 9.5 Other expenses 350 3.5 Total 1300 13 Cost of service sold 19420 194.2 Selling Price 22000 220 Profit 2580 25.8 Statement of forecasted profit and loss of Merkstat for the next five financial year plans: Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Sales 22000 23500 24500 25000 26800 Direct selling cost 19420 21500 22100 22800 23100 Other production Expense 0 0 0 Total cost of sales 19420 21500 22100 22800 23100 Gross margin 2580 2000 2400 2200 3700 Gross margin% 88.27% 91.49% 90.20% 91.20% 86.19% Expenses : Depreciation 40 30 35 36 40 Rent 900 750 700 750 760 Other general expenses 180 185 150 155 165 Selling and expense 0 0 0 Total Operating Expense 1120 965 885 941 965 Profit before interest & tax 1460 1035 1515 1259 2735 Interest Expense 0 100 75 25 35 Taxes Incurred 10 20 25 30 35 Net Profit 1450 915 1415 1204 2665 Comparison of the investment with the profit earned: Year 1 2 3 4 5 Net Profit 1450 915 1415 1204 2665 Investment 1000 1000 1200 1000 1800 Read More