Marketing Plan for Butchers@Home - Case Study Example

Marketing Plan for Butchers@Home Executive Summary Butchers@Home is the online sales division of Mauro Bros Butchers, which is located in Melbourne, Australia. This is quite a new division, which is fighting to curve a niche in the market of online companies that sell meat and its products. There are several companies and firms that exist and offer direct competition to Butchers@Home. To overcome the competition, Butchers@Home needs to adopt various strategies that are meant to reach its customers as well as provide incentives for the potential customers to buy and even return to make more purchases. The most effective way to do this is to conduct an online marketing campaign since it is effective and highly specific. This is the marketing strategy that is to be adopted (Butchers@Home). Table of Contents Marketing Plan for Butchers@Home 0 Executive Summary 0 Introduction 2 Mission Statement 3 Situation Analysis 3 Internal Environment 3 Products 3 Financial and Non-financial situations 4 Channels 4 External environment 5 Markets 5 Competitive environment 5 Economic environment 5 Demographic environment 6 Social and cultural environment 6 Political and legal environment 6 Technological environment 6 SWOT Analysis 7 Strengths 7 Weakness 7 Opportunities 8 Threats 8 Critical Issues 8 Marketing Objectives 9 Marketing strategies 9 Target markets 9 Product strategies 10 Pricing strategies 10 Promotion strategies 10 Distribution strategies 11 Reference list 12 Introduction Butchers@Home is a relatively new division of Mauro Bros Butchers, a Melbourne based company that specialises in sale of meat and several other products. The company has been in operation for over thirty years and has served various households and institutions like restaurants and nursing home. The company’s thirty year experience in business has seen them grow form just a small company that was serving an extremely limited number of clients, into a big company that a chain of suppliers and boasts of over thirty different products in its list. After thirty years of service, Mauro Bros Butchers decided to establish a new division that would be used to serve the online market. This is what led to the establishment of Butchers@Home, which is the company’s online marketing branch. Butchers@Home would meet the demands for the exponentially growing online market since many people are nowadays turning to buying things online and even having them delivered to their homes. This enormous market had already been targeted by various companies as well as farms that specialize in sale of meat. Butchers@Home would therefore, be entering into a territory with its own challenges and established competitors. Besides the meat products, Butchers@Home added to their product list several products that are in high demand and are sold by the mother company, Mauro Bros Butchers. This would help them to compete effectively with other established firms. The product mix includes meat and poultry, prepared foods, game, cheese, bones and pet food. With this product mix, Butchers@Home can assure its customers of several products under its name (Cheverton, 2005, 21). Since its inception, the company has performed well since the revenues have been increasing every year. This is so also for profits and markets. At the moment, this online division for Mauro Bros Butchers is quickly growing to become one of the most profitable divisions for the firm. This marketing plan aims at increasing the market share for Butchers@Home by defining the methods to be used to reach new customers and boost sales. Mission Statement The mission of Butchers@Home is derived from the mission of Mauro Bros Butchers. The mission is to provide the community in Melbourne with quality meat and a variety of services that they can access from the comfort and convenience of their homes or wherever they may be. In order to achieve this, the company places considerable values on its customers and devices new ways to reach them in the most effective way possible, while at the same time doing a lot of research and development to ensure that all the potential markets are identified and reached. The company places significant value on quality and timeliness (Westwood, 2008, 12). Situation Analysis Internal Environment Products Butchers@Home offers a wide range of products, besides the traditional meat products. This has given the company a lot of competitive advantage of its rivals, since the company has diversified its products to offer everything that the customer wants. Some of these products include meat and poultry, prepared foods, game, cheese, bones and pet food. This offers a sense of security for the company because a decrease in profits from the sale of one product will be shielded by the other products that are booming in market. This effectively reduces the risk for Butchers@Home running out of business and liquidating. Financial and Non-financial situations Mauro Bros Butchers is a relatively a leading company that has been in operation for the last thirty years. It has performed well financially and therefore, it is in a favourable position launch an aggressive marketing campaign, without too much constriction to money and other financial factors. Additionally, the Butchers@Home website is already functional and is where the purchases are made. Channels The most effective way to reach the people is through advertising on the Internet. This is a remarkably effective way of advertising, especially to a localized group of people. In this case, the target market is the Australian city of Melbourne. By carefully defining the adverts to place on the Internet, we can effectively manage to target only people who are accessing the Internet from Melbourne. Even better, the advert can be devised only to show for only those who are searching for ‘meat,’ ‘online shopping,’ or anything that may seem to suggest that the person may be interested (Westwood, 2008, 14). The advantage of advertising online is that one will only end up paying for the advertisement only if it is clicked by a potential customer. To ensure high conversion, it is essential to ensure that the web page that one is directed to from the advertisement is appealing and strong enough, so that the person will be convinced to purchase from Butchers@Home. External environment Markets The online market provides almost unlimited number of opportunities. This is because people all over the world are warming up to online shopping as opposed to walking to a shopping mall and physically doing all the shopping that one needs. The only limitation here is that Butchers@Home operates and delivers product only within Melbourne, hence a limitation for the geographical location of people who do not live within the specified location. Other companies that have been operating online have also participated significantly in increasing awareness and helping to form an online shopping culture for meat. Butchers@Home can take full advantages of this environment to get a market share (Fifield, 2007, 104). Competitive environment Already, there are a substantial number of companies that are marketing and trading meat online. Some of them are even farms, which offer the sale of meat in large scales. However, this should not be a threat at all, since there is also a wide market as well as an unlimited opportunity for growth. The supermarkets and other shops also offer competition, but due to lack of intermediaries and other links, Butchers@Home is able to beat this competition and sell its products cheaper. Economic environment There is a sizeable market for Butchers@Home based on the current economic performance. The global financial crisis led to recession in leading economies, but this was not felt terribly much in Australia, hence the purchasing power was not particularly much affected. The populace still remains strong and able financially and thus the market is sizeable. The incentive of free delivery for those who buy in bulk also attracts buyers, since the meat is vacuum-sealed and can last for a long time (Debelak, 2000, 74). Demographic environment The target market is quite broad and involves all types of people. Meat products form part of many diets for the Australian people and is consumed across all ages and genders. The demographic characteristics of the target people have little or no influence on the market. Social and cultural environment Meat is an excellent delicacy in Australia, especially in cities like Melbourne. The habit of taking meat is so much developed and meat constitutes part of almost all the finest meals. This is what has promoted the continuous growth in this industry. It is a delicacy not only in homes but also in social events. This is the reason why businesses that have specialized in selling meat have been flourishing. Besides, Australia boasts of large cattle farm and ranching as an economic activity has been practised for a long time, further promoting consumption of meat. Political and legal environment Mauro Bros Butchers has been in operation for over thirty years, hence has overcome any political or legal challenges that may have been present. However, the online shop concept is relatively new but there are sufficient legislations that can be used to govern the way online business is carried out. There are therefore few or no political hurdles that Butchers@Home may experience (Hooley, 2008, 25). Technological environment The concept of online butchers is simply powered by technological advancement. This is because it is simply the traditional form of selling over the counter, but this time round it has been shifted to using the Internet and delivery services are also provided. There is no single risk that is posed by change or advancement in technology. SWOT Analysis Strengths Mauro Bros Butchers is a well-established business firm that has been selling meat products to households, nursing homes and restaurants for well over thirty years. This gives them an added advantage by the fact that they are well known by virtue of the fact that they have been in the market for quite a long period. This can be used as a platform to promote the Mauro Bros Online Butchers, as there is sufficient brand loyalty that is associated with Mauro Bros. The company also sells a wide range of products, making it a preference for shoppers with a big variety of requirements (Cheverton, 2005, 24). Besides the above factors, Mauro Bros Online Butchers has gone a step further ahead of its competitors, by offering a wide range of payment options like PayPal. This is set to be favourable for many people who are currently adopting the use of online based payment system that is extremely secure. Whenever online transactions are involved, extreme care must be taken to ensure security. At the moment, PayPal offers one of the most secure online transaction services. Weakness Mauro Bros Online Butchers is quite young, although the company has been in operation for a long time selling meat and other products. This new online division enters the market that is crowded with several established online meat sellers, hence must work extremely hard to cut itself a niche in the market. The cost of delivery of the products is quite high especially when the cost of the goods bought is low and when the distance involved is far. This is may lead to decreased revenues. Transportation also offers a limitation in the distance that can be covered; hence, the service is restricted to several parts of Melbourne. Opportunities The full online market potential for meat and related products is hugely unexploited and offers unlimited potential for growth. This offers an exceptional opportunity for Mauro Bros Online Butchers as the division pushes to increase sales by targeting the online market. In addition, buying meat from Butchers@Home is quite cheaper than buying from the supermarkets and one can be assured of fresh product and a better variety of products. The strategic location of the company is also beneficial, since Melbourne offers an extensive market due to its high population. These factors provide Butchers@Home with many opportunities for growth and expansion (Mercer, 1998, 23). Threats There is a wide range of established companies and farms that have adopted the sale of meat through the Internet. These are the likes of Old Style Butcher, Butcherboy and P S meats. These farms and companies will offer a lot of competition for Butchers@Home and some of them have already grabbed a sizeable market share. Besides this, people have hugely adopted the habit of shopping everything under one roof, leading to a high reliance on supermarkets and colossal shopping malls. These are also direct competitors that Butchers@Home will need to compete with for the existing and the emerging market. The cost of live animals also determines their profitability, as they do not keep their own animals but the source for them from other markets. Price fluctuations therefore offer them some unpredictable challenges. Critical Issues As Butchers@Home labours to gain ground in this business and to increase sales, there are several issues that will keep confronting them. The company offers delivery service to its customers through various means. There is a need to ensure that the delivery costs do not rise too high, and there are no additional costs that are incurred in the delivery process. This can be in terms of fuel costs, fleet maintenance and several other costs. These are all costs that can rise and pose a threat to the business (Luther, 2011, 29). The company’s website needs to be improved and ensured to ensure that it is extremely secure for customers who want to use their Visa or MasterCard to make purchases. Online buyers are always wary of identity theft and it is the responsibility of the company to ensure that its clients are secure and are not faced by these threats. One way to do this is to obtain an online certificate for its website, which guarantees the clients web security. Marketing Objectives The marketing for this new division of Mauro Bros Butchers is meant to achieve the following objectives: i. Create awareness about the existence of Butchers@Home since it is relatively new. ii. Create awareness among the residents of Melbourne about the services and the product that the company offers, hence stimulate demand. iii. Encourage people to buy their meat products from Butchers@Home, especially those who shop online. iv. Retain the customers once they have been directed to buy from Butchers@Home. Marketing strategies Target markets As an online shop, one of the most distinctive characteristic of people who are expected to shop here is that they use the Internet. The marketing strategies should therefore seek to reach just these people, who are the majority of people in Melbourne. Statistics indicate that many people in Melbourne are regular users of the Internet, in the course of their work, as either students who are researching or even people who are entertaining themselves through social media and other sites. However, there is the issue of bulk buying, where only those people who buy in bulk enjoy the free delivery service. The implication of this is that those who buy in less quantities pay more money to cater for delivery, thus this may not be attractive for them. Marketing should target those who buy in bulk like those with families (Schnaars, 1998, 25). Product strategies The product mix that is offered by Butchers@Home is meant to cater for all the needs of customers in terms of meat products. This includes meat and poultry, prepared foods, game, cheese, bones and pet food. By retailing all these products, it will ensure that most of the customers’ needs are met through this single website, hence, a variety of products will be necessary to hook them. This is why Butchers@Home needs to offer all the products that are offered by Mauro Bros Butchers. Pricing strategies The pricing strategies to be adopted are aimed at ensuring the lowest possible pricing while still maintaining the quality that is expected. Lower pricing strategy will ensure that many people are interested, as well as help to keep them returning and make more purchases in the future. Promotion strategies To promote the products, online advertisement will be employed. The advantage of advertising online is that one will only end up paying for the advertisement only if it is clicked by a potential customer. To ensure high conversion, it is essential to ensure that the web page that one is directed to from the advertisement is appealing and robust enough, so that the person will be convinced to purchase from Butchers@Home (Pond, 2009, 51). Distribution strategies There is less movement of goods whenever online marketing is concerned, unless a customer has already placed an order and has bought the product. There is therefore no need to set up complex distribution mechanisms for the products, but this is necessary once the products have been purchased. Butchers@Home needs to come with various methods that will be used to deliver the products in the most efficient way possible to minimize losses and ensure extraordinarily high standards of hygiene since what is involved is food meant for human beings (Mercer, 1998, 21). In order to ensure that there is customer satisfaction, one has to make sure that customers get the value of goods that they pay for and any arising complains are dealt with firmly. This will ensure that customers remain satisfied and loyal all through as they purchase the products of the company. Customer loyalty will play a prominent role in business since it is the returning customers who are confident and are willing to spend a lot of money on products. These customers can also act as an advertising tool for business. Reference list Butchers@Home. http://www.butchers.net.au/ Cheverton, P. 2005. Key marketing skills: strategies, tools, and techniques for marketing success. 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Marketing Strategy and Competitive Positioning. Prentice Hall, 2008, pp. 36-59 Read More