PESTEL and SWOT Analysis of Mengo - Soap Meeting the Customers Demands and Expectations - Report Example

Name) (Instructor) (Institution) (Course code) (Date) Executive summary Mengo will be made from natural ingredients. That is, it will made from fresh goat’s milk. The soap will not use powdered milk because of chemical ingredients they contain. The company also use organic fragrance oils for colouring and sweet smell in the making of Mengo soap To meet the customers’ demands and expectations, Mengo soap will offer what other commercially produced soaps cannot meet. Many people out there have various kinds of allergies which some arises from the products and soaps we use. Mengo soap will therefore steps in to fill the gap created. When some people use soaps get allergies or the skins dry up. This results from the chemical additives in these soaps. Mengo soap will be friendly to human skin. It keeps the skin in its natural form. As a marketing strategy the company will produce a wide variety of Mengo soap products including Embellishment Gift Packs, Mini Goats Milk Bars and Goat Milk Skin Soaps to meet the customers’ needs and satisfaction. The high standard packaging of these products makes them the best gifts. This makes the marketing cheaper for the company The following; quality and fashion of the Shanghai market and Beijing’s Classic and quality apply in the ads. It is there important to note that as they will not be deeply discussed in every ad Introduction There is no doubt that brand management is an important issue for every business person; especially when they try to develop and expand their brand to the international market. Different countries may have totally different manners, for instance, the culture, the life style, the consuming ability and so on. There are generally some processes to analysis and estimate the feasibility plan: Marketing objective, marketing strategy and marketing mix, action plans and budgets, the organisational implications, an evaluation and monitoring plan and so on. This report discusses about an idea of a local handmade soap brand Mengo which will venture to the market. Its first market to venture will be Shanghai and Beijing in China. Brand background The idea of Mengo began with my aunt who has suffered from allergies since she was young: she cannot use any normal commercially made body soap, or her skin would be itchy and cannot sleep whole night. This symptom really annoyed her until once she found that goat’s milk soap was good to relieve this problem. After that, she started to think about how to spread that kind of good products and help people who have the same problem like her, based on our family’s support and our professional business sustainability assessor background, we have researched the idea around two years then Mengo soap brand came to our mind In addition, Soap de villa cares more about the social responsibility; they cooperate with the local groups to donate for orphanages and support. The Shale project, where people buy one Mengo, the company will donate US$1 for the AIDS epidemics in Africa. In this opinion, a business would not only concern about itself, it has the responsibility to help other people who need more supports, and lives will have more meaning when people try to make difference in other people's lives. Just like our motto - “Change your life, change the world". PESTEL analysis Political forces Chinese government has been stable for a long time which makes Beijing and Shanghai suitable business environments. Any manufacturing processes carried out at these two cities have to comply with the environmental regulations. The government has set taxes which have to be adhered to. Economic forces Economic trends in the country will have an impact on the business. Shanghai and Beijing have a large population with disposable income. China has a low inflation rate and a high GDP. The country have set minimum wage which all business have to adhere to. The cost of housing has been rising in China hence the business will have to incur high costs of rent. Chinese currency has been stable hence and the country has been experiencing positive growth. Inflation is at around 1.5% in China and the country’s currency has appreciated which have lowered the cost of consumer goods (BBC News, 2015) Socio cultural forces With the advance of economy in China, people start to care more about the soap material and prefer to separate the usage. They start to separate the different soaps in different ways, for instance, for hands and for bodies are different. Furthermore, family members are choosing different soap that is suitable for their skin or taste. It is clear that China will be a good target market to focus on. Technological forces Most are increasingly using technology in their operations with aim of customer satisfaction. Customers will offered with online sources of information which includes reviews and comments made by other customers. Trends on Mengo soap brand will be are monitored using technology during consumption. Use of IT in the industry will make it easy for the management make decisions easily Legal forces The Chinese government has set laws which have to be followed in the manufacturing industry. There are industry regulations which one has to follow. At the moment, health act, minimum wages and fair competition are main legal issues that are vital for operation of Mengo soap brand SWOT Analysis Strengths a Availability of natural raw materials like goats milk and natural oils in plenty b The staff are dedicated to the company and grow with it c Much of the company work is to the help the poor and hit by pandemic like HIV/AIDS in Africa d The company has the best designers. They used locally assembled products to come up with outstanding products e Great innovation Weakness a Lack of large financial base b Handmade process resulting to less output Activities to address weaknesses a Offer an Initial Public Offer (IPO) to raise more funds b Invest in technology that will speed up the production Opportunities a Large customer base in Beijing and Shanghai b Currently there is no competitor producing the similar product c The soap use has been increasing in china by 20% d The life style of Chinese care more about soap material and prefer separate for different use e The care and conservation of the natural environment is the increase. There more concern about pollution and environment degradation f Much of China’s cities are polluted. Entering with Soap de villa is something to relish g Shanghai has a large and prosperous port city where many of foreign products hit first h The people of Shanghai are concern more about quality rather than the price of products Threats a The Chinese take advantage of every opportunity that comes their way. Other large companies (competitors) might steal the Mengo or buy the idea and start their own using their large capital base Activities to address threats a Collaborate with one the leading companies in China that is a threat in order to minimize competition Target market China is a BIG Cake Since 1978, the Chinese government has implemented a comprehensive and strategic Opening-up policy which involved permitting increasing foreign direct investments and global trade to ensure a progressive economic development. These policies have proved the county’s socio-economic development and have given the residents a considerable impact (Gerdes, 2014). China has become one of the biggest markets for businesses which from the whole world. Current Soap industry in China In China, people are used to using soap in their daily life, for example, washing hands, faces, bodies, dishes and clothes. It is more popular than other type of cleansers (e.g. shower gel and powders). According to Daxue consulting (2012), in average, each Chinese people consume around 23.68 units soap per year as well as the soap market in China is increasing more than 20% every year. With the advance of economy in China, people start to care more about the soap material and prefer to separate the usage. They start to separate the different soaps in different ways, for instance, for hands and for bodies are different. Furthermore, family members are choosing different soap that is suitable for their skin or taste. It is clear that China will be a good target market to focus on. Shanghai：Quality and fashion Shanghai is one of the most urbanization cities in China. It is situated on the east end of Yangtze River Delta. It is also covers halfway of China's eastern coastline. As a result of its advantageous geographical location, this city has developed into a large and prosperous port city (Shanghai Geography, 2015). Many of foreign brands start to hit the Chinese market from here. People who live in Shanghai are also more used to facing new products, cultures and concepts as well as they like to follow the world fashion trend; they pursue the better life style and proud of being the leader city in China. Due to the high consumption ability of shanghai citizens, they start to have more requirement about the goods; the most important consideration is not the price, instead of are the quality and fashion. Beijing：Classic and quality Beijing is the capital city which is located in the North of China. It is regarded as the cultural, political, and educational centre of China. It is also very important to note that Beijing has been part and parcel of China’s history due to its 3,000 years history (Fiaformulae.com, 2015). Because of the historical background, Beijing people have lived in this atmosphere and proud of to be the capital citizens; they prefer to pursue the product which is more classic and quality. Beijing residents may not pursue to consume the most fashion style products, but they would like to choose the products that are valuable and match their profile. Product Mengo soap products will emphasised on handmade by natural goat milk as well as the product has already got the China Made logo to prove its quality. The company will make the product category very simple and easy to remember: lemon myrtle pie, jasmine tea, country lavender, rose bouquet, mango smooth and natural milk bottle. The total six different smell products will have different collocations and packages for customer’s needs. Price The company will publish the price of the Mengo to be US$3. Comparing with original commercial brands which are selling in the supermarket is around US$0.8-1.8 for each and the similar focus on handmade brand Lush is around US$2.3-3.2 for the same. Obviously, the price is between these brands and competitively. Place About the selling strategy, company will mainly sell the products in the official website and in six physical stores which are all located within the two cities. Customers manly purchase the products via internet, phone call or go to the retail shops. In addition, now they add the new platform that people can use smart phone to browse and buy the goods online. Promotion At the early stages of market entry, Mengo will not focus on traditional commercial marketing as it is too expensive and not really efficient at the moment. Following the world trend, the company will choose to use social media such as Facebook and Twitter to promote the brand once launched into the market. The company will frequently update news about it, including inviting people to charity activities; share the product pictures and their normal life. Just like friends, the company will create a warm and kindness image for its customers. This is because makes people feel comfortable and relax to join this brand and share life with it. Action plan Marketing activity Who is responsible Expected date of completion Cost (US $) Success indicator Use of blogs and social sites Customer care Dec 2018 1,000 More customer feedbacks Organizing charitable events and project Company outreach team Sept 2016 20,000 More inquiries during events Local networking groups and businesses Company outreach team June 2018 3,500 More customers linked up Guerilla Marketing Company outreach team Oct 2018 5,000 Invitation to events Ask for referrals Customer care and Company outreach team Dec 2020 500 More customers won from referrals Customer involvement Customer care Dec 2020 1,000 Customer feedbacks Improved marketing accounting Accounting department Dec 2016 3,000 Reduction in money lost Print media Marketing department Dec 2016 10,000 Improved sales Mail Customer care Dec 2020 1,000 More online and mail inquiries References BBC News,. (2015). China's inflation near five-year low. Retrieved 9 January 2015, from http://www.bbc.com/news/business-30738406 Daxue Consulting - Market Research China,. (2012). Market research: Soap market in China. Retrieved 10 January 2015, from http://daxueconsulting.com/soap-market-in-china/. Fiaformulae.com,. (2015). Round 1 | 13 September 2014 | Beijing, China - Official FIA Formula E Championship. Retrieved 10 January 2015, from http://www.fiaformulae.com/en/calendar/2014-beijing.aspx Gerdes, S. (2014). Western food in Shanghai. Chinese consumption patterns and globalization in China. Munich: GRIN Verlag GmbH. Travelchinaguide.com,. (2015). China Shanghai Geography: Location, Terrain, Physical Features, Mountain, River. Retrieved 10 January 2015, from http://www.travelchinaguide.com/cityguides/shanghai/geography.htm Read More