Marketing Plan for Weetbix - Case Study Example

Weetbix Name Institution Marketing Plan for WEETBIX Table of Contents Marketing Plan for WEETBIX 2 Table of Contents 2 1.0 Introduction 3 2.0 Overall Strategy 3 2.1 Strategic Alternatives available (or Product Development, market development and Market Penetration) 4 2.3 Positioning 5 2.4 Segmentation 5 3.0 Product Strategy 7 3.1 Packaging 7 3.2 Product Lifecycle Stage 8 3.3 Branding 8 4.0 Pricing Strategy 8 4.1 Pricing tactic 9 4.2 The relationship between price and perceived value 9 5.0 Distribution strategy 10 5.1 Distribution strategies 10 5.2 Distribution level 11 5.3 Online distribution 11 5.4 Strategic alliances 11 6.0 Promotion strategy 12 6.1 Promotional mix 12 6.2 sales promotion and Advertising 13 7.0 Conclusion 13 8.0 References 15 1.0 Introduction With increase in globalization, information technology advancement, and growing pressure from external forces, it means that managers can no longer use old marketing strategies today in their operations. It is a culmination that the marketing has changed from traditional ways to modern strategies. Whereas the organizations agree that they no longer assumes loyalty, and call for adopting continuing marketing strategies so as to remain ahead of other market players, the content and design of the strategies keeps on evolving. RMIT University (2012) stated that in the last few years WEETBIX has not been able to hold its market share due to various competitive and market forces. Therefore, this market plan will advise Sanitarium Health & Wellbeing Company on ways it can improve its marketing activities through new strategies in New Zealand. Some of the factors that will be discussed include overall strategy, product strategy, pricing strategy, distribution strategy and promotional strategy. 2.0 Overall Strategy WEETBIX overall strategy is geared towards its corporate objectives which are “to offer healthy food which actively enhances the well-being and health of the community and to provide realistic health advice and clear nutrition information” in New Zealand (RMIT University, 2012). Among the leading firm globally, Sanitarium Health & Wellbeing Company has set up an effective corporate strategy which is strong rooted its survival in the cereals food industry. From the marketing myopia school of thought by Theodore Levitt, Sanitarium Health & Wellbeing Company has emerged as a marketing cognizant company that concentrates its branding on the customer value by conducting widespread market research so as to match its customer based culture. 2.1 Strategic Alternatives available (or Product Development, market development and Market Penetration) Sanitarium Health & Wellbeing Company aims at increasing its revenues by 3% by introduction new forms of WEETBIX, enhancing innovation and introducing new technology in the upcoming financial year (Campaignbrief.co.nz, 2015). The research has shown that Sanitarium Health & Wellbeing Company must change its technology in order that it can raise its productivity and outdo its competitors. Introducing new products means the company is changing and ready to solve the new needs of the customers. The company will use market development strategies in its market plan to increase its growth. WEETBIX market development strategies conducted to targets non-purchasing clients in presently targeted segments. In its market development strategies, WEETBIX target new markets in New Zealand. Such areas have high income and large number can afford cereals. They also need cereals which are low in sugar. The research has shown that there will be a high scope in the cereal international market. Campaignbrief.co.nz (2015) claimed that WEETBIX will be aiming to capitalize and increase its market awareness, build its brand image and grow its profit. WEETBIX market penetration strategies are aimed at gaining competitor’s customers through effective advertising, low pricing and improved product features. With large customer base in the market WEETBIX is assured of increased revenue, large market share and strong brand image. In the face of competition, the company use positioning strategy to create a perception among customers. 2.3 Positioning The study on the WEETBIX in comparison to other products in the market demonstrates that it has a higher nutritional, quality, value and benefit hence high price (Adams, 2012). Therefore, the company must show the product on the top right of the conceptual map (see figure 1). Although the product is placed lower than rival company, Kellogs. Therefore, in comparison with Kellogs the company positions as a low price company. Sanitarium Health & Wellbeing Company has realized that mass marketing does not need mass marketing because it limits them from satisfying industry specific cereal demands. 2.4 Segmentation The company needs will need to review its segmentation criteria & target markets to be able service a section of market satisfactorily. Therefore, the company segments its market based on geographic and demographic such as countries and age. WEETBIX will therefore target teens and young adults in New Zealand (Samoa, Tonga and Fiji). Perceptual map Price (premium) .Kellogs .Weet-Bix .PAMS .Milo . Nutrigrain .Cocoa Piffs Brand Basic Premium . Sanitarium . Rice bubbles .Fruit loops .Corn Flakes Price (affordable) Figure 1: Perceptual map of WEEBIX (positioning) 3.0 Product Strategy WEETBIX is a shopping product which is usually bought at a low price. The product has a low client involvement hence regarded as an affordable product. 3.1 Packaging The company has changed WEETBIX‘s packaging over the years to make it more attractive and suits the need of customers. However, in the recent years the company has not changed its packaging making it very difficult to attract more customers (RMIT University, 2012). The brand may gain competitive advantage by changing packaging; nevertheless the major colors of the product ought to remain the way it was so that clients can still recognize WEETBIX. The company can use Sports stars who are popular on television can be featured on the WEETBIX’s packaging to attract customers who are fans of sports (RMIT University, 2012). In addition, the company can use catchy packaging which can stand out among other competitor products and attract more customers within the shelf. The ingredients such as honey, banana and sweet potato can be shown on the package to help influence the purchase decision of consumer. 3.2 Product Lifecycle Stage WEETBIX was first launched in the cereal industry in 1920 with the company positioning it as an “economy-friendly and health biscuit,” and is presently in being at market maturity phase of the product cycle (Adams, 2012). It implies that the sales have balanced off as the product has gain awareness and accepted by most consumers within the marketplace. WEETBIX major emphasis should be expanding in other markets and defending its place in New Zealand market. 3.3 Branding The company has branded WEETBIX as healthy breakfast option and ‘Aussie Icon’ for consumers who want to lead a healthy and active lifestyle (Adams, 2012). The company’s brand has stayed strong and will stay strong by promoting its product standing and associating it with Australian spotting activities and clubs like sponsorship of the Australian and New Zealand Rugby and Cricket teams. The company also showcases its brand by participating in sporting activities like cricket bootcamp and Weet-Bix kids TRYatholon. IT can improve its branding by sponsoring football events which is very popular in New Zealand, Australia and globally. To enhance WEETBIX’s branding as the healthy breakfast option the company need focusing more on sponsorship of more sporting clubs and sponsorship of TV shows like “The Biggest Loser” which has a massive following. The strategy assist on promoting WEETBIX as a brand to consumer are either fans of sports and also customers who wants health cereals for breakfast. In addition, branding should also be influenced by cultures of the new markets. 4.0 Pricing Strategy 4.1 Pricing tactic The firm ought to put into consideration some factors to determine the viable price in the market. Factors like the type of customer target, value, social status, production cost, competition and product features can be used to determine the pricing strategy. Cereal is form of a fast-moving consumer product with many substitutes hence its price cannot be too low and also too high. Currently, WEETBIX is sold at affordable price in New Zealand and Australia to counter competitors Kellogs who sells at premium prices and Milo and Pams who sell at affordable prices too (Campaignbrief.co.nz, 2015). However, as the company now intending to expand and introduce developed WEETBIX into New Zealand markets, it will require to use a defined pricing strategy particularly Penetration pricing with an objective of attracting a number of new customers. The low prices should be applied on original WEETBIX bites and WEETBIX flavoured items in their usual size. Lowering prices is aimed at trying to gain large market share within 18 months. Advantage of penetration pricing is that it will lead to adoption and fast diffusion. The situation will surprise competitors as WEETBIX rapidly gains penetrating rates. 4.2 The relationship between price and perceived value Value is very important to customers because with this factor, the customer will be willing to buy products even with premium prices. WEETBIX has a nutritional value because it supplies proteins and fiber to the body, hence contributes to keeping body healthy. In a nutshell, the price is set in relations to value of the product. An entry into New Zealand can be marked with penetrating and later adopt premium market when the company has gained customers and receives high sales. However, the company must also improve WEETBIX ingredients or contents to match are prices. Even though, WEETBIX can be expensive compared to a box of normal breakfast cereal, it makes a breakfast cereal that conveniences the customer. The consumer will be willing to pay more for the service’s convenience. In this situation, WEETBIX can use value-based pricing strategy that will charge more due to the added value. 5.0 Distribution strategy 5.1 Distribution strategies WEETBIX uses the indirect distribution strategy in which once it is manufactured, the company use the retailer firms like Woolworths and Cole to act as intermediaries for selling the product (RMIT University, 2012). Once the product is distributed to the two stores, the customers can then buy the good from the nearby intermediary firm. RMIT University (2012) claimed that WEETBIX is often distributed over several convenient stores and groceries across New Zealand giving the company a large scale of distribution. Several intermediary firms are advantageous since “intermediaries could offer market access which would be costly or impractical for the company to acquire. Such corporate distribution channel used by WEETBIX enables shopping experience to become simpler for customers and more efficient. This mode delivers WEETBIX to consumers within an environment which they feel is convenience for buying. Cereal is considered not a special product and consumers can easily buy it when their come for daily or monthly shopping. Clients who purchase at the retail grocery quite often intend to make comparison and contrast about the presence of WEETBIX offer them a chance to select one brand over those of competitors and the process is where marketing strategies of WEETBIX play a critical role. The packaging, pricing and promotional strategies which WEETBIX have selected to apply may influence the customers to choose and purchase a product. Nevertheless, once the finished product is distributed to a retailer several burden and risk of selling it therefore rests with retail company, therefore WEETBIX split the sales’ responsibility with the intermediary set ups. Degree of exposure matter to the company and product itself due to the fact that it determines level of sales. 5.2 Distribution level Normally, there are 3 degrees of the market exposure for products including selective, intensive and exclusive. The three levels are also regarded as the distribution strategies. A company is matched with the degree of the market exposure based on number of the intermediaries. WEETBIX is within the intensive level and has many intermediaries. WEETBIX currently have a high presence in New Zealand and customers can get it when and where they want. For instance, WEETBIX are now available fast food stores, petrol satiation and supermarkets. Campaignbrief.co.nz. (2015) argued that since WEETBIX has a chosen target market of the teens and young, the product has to be highly and easily accessible. Figure 2 shows compiled market targets for cereal industry players. Thus, the distribution strategy, intensive exposure, WEETBIX relates effectively with the needs of the market. 5.3 Online distribution In its expansion to New Zealand, the company will need to invest in online distribution. It is very risky for a new business to have many distribution outlets when the company is yet to attain a large customer base. Online distribution is also advantageous because many people are now online hence are likely to carry out online transaction. 5.4 Strategic alliances WEETBIX should use strategic alliances in New Zealand to enter into these markets. For instance, in New Zealand, WEETBIX can partner with Guilin Sea Mild Biology Technology Development to reduce political, economical and social risks. In the process, it will also benefit from partnership technology infrastructure and market knowledge. Figure 2: Target market and positioning 6.0 Promotion strategy 6.1 Promotional mix WEETBIX promotional strategies are inclined towards target markets such as children, young adults and career based adults (Campaignbrief.co.nz, 2015). Because most of the target markets have a busy schedule, they always need consistent exposure to product in various ways. Therefore, experts argue that the company should make them aware concerning the new product, persuade the customer to try the new product and make them desiring to buy WEETBIX on a regular basis. By continuously promoting and advertising giveaways and prizes there is more likelihood that target market will turn out to be regular product consumers. The information WEETBIX passes across to consumers it revolves around health. In fact, Sanitarium Health & Wellbeing Company markets WEETBIX as healthy option cereal for the kids and young adults which will help them live an active lifestyle (RMIT University, 2012). 6.2 sales promotion and Advertising WEETBIX has strong promotional strategies which involve sponsorship, newspaper ads, in-store posters and display, advertising, television ads, sales promotions and product placement to continuously remind customers to buy their product rather than other brands of cereal (RMIT University, 2012). However, the technology is fast taking over the marketing and promotion industry. AS the Sanitarium Health & Wellbeing Company expands and introduces, online advertising will be a good platform to create awareness because a number of potential consumer now spend their time shopping for new products. WEETBIX should also increase its partnerships with not just Australian and New Zealand celebrities, but international celebrities to endorse their products in order to increase the number of people who will be buying the product. 7.0 Conclusion In conclusion, WEETBIX has been having effective marketing strategy in cereal industry. However, competition from Milo, Kellogs and Pam dictate that the Sanitarium Health & Wellbeing Company must continuously update its marketing strategies. The assessment into its current marketing plan has demonstrated few weaknesses which need to improve to increase its competitive advantage. The companies pricing strategy and positioning as affordable product is still working to the company’s advantage. However, WEETBIX product strategies like branding has not been appealing because the Sanitarium Health & Wellbeing Company takes time to change the package hence may not contribute to its success. WEETBIX’s Promotional strategies have been effective in the past but have been ineffective in the recent past. Based on the weaknesses found, this report recommends the Sanitarium Health & Wellbeing Company to invest more on technology particularly online distribution and advertising to improve awareness and the ease of access of the product in other countries. 8.0 References Adams, C. (2012). Lifting the lid on Sanitarium. NZ Herald. Retrieved Oct 26th 2015 from http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10816412 Campaignbrief.co.nz. (2015). Weet-Bix target market Weet-Bix fuels the youth market in its latest integrated campaign + app via BelowTheLine. Retrieved Oct 26th 2015 from http://www.campaignbrief.co.nz/2014/02/weet-bix-fuels-the-youth-marke.html RMIT University. (2012). Marketing Plan Summary Sanitarium – Weet-Bix. Retrieved Oct 26th 2015 from https://www.dlsweb.rmit.edu.au/bus/public/mktg1329_managing_teamwork/resources/Mktg%20plan%20sample%20-%20Sanitarium%20Weet-Bix.pdf Read More