Situation Analysis and Target Market Identification - Essay Example

Palmolive (natural, vibrant, colour, shampoo) - Situation Analysis/Target Market Identification Report and Collage Table of contents 0 Situation Analysis/ Current Marketing Mix 3 1.1 Current Product 3 1.2 Current Pricing 4 1.3 Current Distribution 4 1.4 Current Promotion 5 2.0 Segmentation theory 6 2.1 Define and explain segmentation. 6 2.2 Explanation of 3 benefits to the brand from using segmentation 6 3.0 Target Market Identification 6 3.1 Geographic Segmentation 6 3.2 Demographic Segmentation 7 3.3 Psychographic Segmentation 7 3.4 Behavioural Segmentation 7 4.0 Target Market Collage 9 5.0 Completion of Discussion/Rationale of the Target Market Collage Images Chosen Table 10 6.0 Reference List 12 1.0 Situation Analysis/ Current Marketing Mix Palmolive natural shampoo vibrant colour is among the key products of Colgate Palmolive. The potential performance of this product in the Australian market requires the analysis of its marketing strategy using the Marketing Mix Model. Then, through the segmentation of the market, the most appropriate policy for the promotion of the product across the particular country can be identified. 1.1 Current Product Marketing mix model focuses on specific parts of a firm’s marketing strategy. Product is one of the basic elements of this strategy. By promoting a particular product, a firm needs to consider primarily the following two issues: a) would be the development of existing product a priority or b) emphasis should be rather given on the increase of the firm’s share in the targeting marketing (Sloman 2005, 73)? In the second case, the firm should try to introduce new products while in the first case the characteristics of a firm’s product should be rather highlighted through appropriately customized marketing strategies. In the case under examination, the first strategy would be rather used, aiming to emphasize on the advantages of the firm’s specific product, the Palmolive natural shampoo vibrant colour in regard to the targeting market, i.e. the Australian market. On the other hand, Dibb et al. (2008) note that the term ‘Product’ as part of the marketing mix model, refers to a series of issues, including the ‘quality awareness, the product image, the value and the quality of the product but also the product performance’ (Dibb et al. 2008, 94). The marketing policies used by a firm in order to support the performance of one of its products have to refer to the above qualities/ needs of the product, the promotion of which in the targeting market will be attempted. In the case under examination, the marketing strategy of the firm in regard to the specific product would be additionally influenced by the following facts: the Palmolive natural shampoo vibrant colour has been introduced in order to meet specific needs – the needs of people with colored hair for increased hair care and protection (Colgate Palmolive 2011). More specifically, the above shampoo helps towards the recovery of hair damaged by the colour treatment; in the specific product, a combination of UV filter and Avocado extracts’ (Colgate Palmolive 2011) has been used aiming ‘to ensure the quick recovery of hair damaged by color treatment but also to ensure the increase of life of colored hair and the improvement of quality of colored hair’ (Colgate Palmolive 2011). It should be noticed that a conditioner is available by the firm in order to increase the benefits/ effects of the specific shampoo. The package of the above product can be characterized as satisfactory proving clear information on the content and the qualities of the product; moreover, the use of different color in the product’s packaging – compared to the other products of the firm – helps to distinguish the specific product among the others of the same firm but also among other products with similar characteristics. 1.2 Current Pricing The price of the particular product can be characterized as of an average to low level – compared to the price of similar products of its competitors (Leader et al. 1990). More specifically, in Coles the product is priced at $5.44, in Woolworths it is priced at $5.36. Online, the price of the product is a bit lower, from $3.99 up to $4.45. The price of the other products of the same category could be analyzed as follows: a) the price of Pantene Pro-V Radiant Colour Shampoo is $2.55, b) Dove Therapy Colour Repair Therapy Shampoo is priced at $2.89, c) the Fudge Colour Lock Shampoo is priced at $8.39, d) the price of Head & Shoulders Colour Care Shampoo is $2.39 and the Iq Colour Care Shampoo is priced at $11.29. It is clear that the price of the product would not be a barrier for the development of the product in the Australian market. In fact, in its current price the specific product is accessible by most consumers in the particular country, which should be the key target of the firm’s marketing strategy (Vashisht 2005). 1.3 Current Distribution The distribution of the product in the Australian market is made mainly through the supermarkets and the pharmacies. In addition, the product is also available online, an option which offers to consumer the benefit of limited price – compared to the price of the product in stores – as explained above. In the above context, the product’s distribution strategy is similar with that of its competitors – referring to the distribution methods used for products of similar characteristics (Stevens et al. 2005). However, certain of the similar products of the competitors are available only in Salons, as for example, the Iq Colour Care Shampoo and the Fudge Colour Lock Shampoo. The distribution method chosen for the particular product can be characterized as quite satisfactory offering the following advantages: a) the specific product can be accessible by a high number of people/ shoppers in supermarkets, a fact offering to the product a competitive advantage, at least towards its competitors which do not use such distribution strategy (Pride et al. 2008), b) the product will be accessible even in hours when Salons are closed – referring to the case of supermarkets that work on a 24hrs basis, for instance Coles. 1.4 Current Promotion In order to understand the success of the firm’s marketing strategy in terms of the promotion of the particular product, reference should be made to the current methods used by the firm for promoting this product in the Australian market: a) the advertisement of the product displayed recently through the television, can be characterized as quite satisfactory, however, more emphasis should be given on the distinctive characteristics of the products compared to the similar products of the competitors – which have similar prices and might be preferred by consumers (Shah et al 2009), b) another advertisement of the particular product has been presented online – in a website focusing on all issues related to the daily needs of women in terms of their appearance. Despite the fact that the above method was quite satisfactory, still are issues that should be highlighted, as for example: a) the lack of events through which the products of the firm are promoted (Moore et al. 2009), b) the firm avoids funding activities of the community or others of similar purposes/ nature; probably considering that because of its brand name there is no such need – a view which should be rejected. 2.0 Segmentation theory 2.1 Define and explain segmentation. Segmentation is the process through which the targeting market is partitioned, so that the needs of each part to be more effectively addressed (Wedel et al 2000). The above description of segmentation is the most common one, even in practice, the term segmentation has been used in order to refer to additional marketing initiatives, such as the identification of the parts of the market which have common purchase trends (Lancaster et al. 2007) or the classification of a market in terms of the performance of products of specific categories (Doyle 2008). 2.2 Explanation of 3 benefits to the brand from using segmentation By using segmentation, a series of benefits can be achieved: a) the identification of the parts of the market where a particular product has more chances to be successful – in terms of its performance both in the short and the long term (Wedel et al. 2000), b) the limitation of risks for major losses in regard to the costs of a marketing campaign; by ensuring that the marketing policies engaged are appropriate in terms of the marketing strategy, the risk involved is decreased; therefore, the funds invested on the particular campaign are expected to be paid back (Wedel et al. 2000), c) the needs of consumers within each part of the targeting market will be addressed more effectively; the performance of the product in the targeting market is expected to be increased positively influencing the firm’s productivity (Lancaster et al. 2007). 3.0 Target Market Identification 3.1 Geographic Segmentation Geographic segmentation means that the targeted market will be divided into major geographic areas taking into consideration its geographical characteristics – most commonly meaning the urban/ rural areas of a particular country. In Australia such segmentation would lead to the development of two major marketing areas: the east Australia and the West Australia. As it can be identified in Image 1 the East part of the country is extremely developed – in terms of its population since it is in the specific part where the largest cities of the country are cited. In this context, in order for the firm’s marketing strategy to have more chances to succeed, it would be necessary for an appropriate geographic segmentation to be employed – in the context described above. 3.2 Demographic Segmentation From a similar point of view, demographic segmentation, refers to the following issue: the partitioning of the targeting market so that the demographic characteristics of its population to be better addressed. In Australia the demographic characteristic, which could influence the marketing policy of the firm would be the race – referring to the indigenous people living in the country’s rural areas. In these areas however, the consumption trends are different. For this reason, the above demographic characteristic could not particularly affect the firm’s strategy in regard to the particular product. 3.3 Psychographic Segmentation Psyshographic segmentation is related to the views of people on products/ services as differentiated under the influence of their educational background or their economic status. In Australia, people are of an average economic status, which means that the marketing policies addressing the public in the particular country should not be highly differentiated – in terms of the psychographic characteristics of each part of the population. In fact, in Australia, people of different financial and social status are likely to have similar views on the value of products, their benefits and their necessity. 3.4 Behavioural Segmentation In terms of the behavioural segmentation, the marketing policy of the firm should be developed in accordance with the following principles: a) emphasis should be given on the promotion of the firm’s brand name, but this brand name cannot be used as the only tool for supporting the quality of the firm’s product, b) reference should be made not just on the product’s short term but also on its long term benefits, c) also, efficient justification should be provided in regard to the following issue: why consumers in Australia should prefer the particular product instead of other products, which are more popular in the particular market? A clear explanation should be given on the advantages of the particular product towards the other products of similar characteristics aiming to increase the firm’s share in the Australian market. 4.0 Target market collage Geographic 1 State 2 City 3 Climate 4 Density 5 Age (Demographic) Demographic 6 Gender 7 Income level 8 Education Behavioural 9 Socioeconomic status 10 Personality 11 Activities 12 Lifestyle VALS type Psychographic 13 Use of brand 14 Loyalty status 15 Readiness 16 Attitudes towards the brand 5.0 Completion of Discussion/Rationale of the Target Market Collage Images Chosen Table Target Market segmentation Number of image in the target market collage image How the collage images visually reflect the primary target market - explanations Geographic State 1 In terms of its administrative structure, Australia is divided into five major regions (as shown in Picture 1), the market of each is differentiated – compared to the others. However, in all these regions, the urban development is significant allowing the increase of consumption, which would favor the particular product. City 2 The cities of Australia have different urban characteristics; however, they are all highly populated; products of the particular category are expected to be welcomed by the residents in the urban areas – where the need for hair protection is higher (due to the pollution but also due to the need for a good look in daily social activities) Climate 3 The climate of Australia is differentiated across its regions. In fact, across the country, different climate conditions can be identified; people welcome products that can offer increased hair protection, since these products have usually higher resistance to climate changes. Density 4 Density in the urban areas of Australia is high; the perspectives for new products to achieve significant profits are many taking into consideration the level of each city’s population. Demographic Age 5 In Australia, the social life of people of all ages is significant; elderly, who are likely to use the particular product, especially women, having colored hair, are expected to appreciate the specific product, the price of which is relatively low. Gender 6 One of the key characteristics of Australian society is the equal participation of men and women in social and economic activities across the country; both men and women would be likely to use the particular product due to its quality (in terms of brand name) and its price (which is rather low). Income level 7 The level of income of men and women in Australia can be characterized as quite satisfied; all people across the country can afford the specific product, the price of which is rather low, compared to the similar products of competitors. Education 8 The specific product does not require particular educational background; people of all educational level would be likely to use it if they had need of advanced hair protection. Psychographic Socioeconomic status 9 The socioeconomic status of people across Australia could not affect their ability to buy the specific product. Due to its low price, this product can be acquired by people of different socioeconomic status, a fact that should be considered as an advantage of the specific product. Personality 10 People in Australia pay attention at their needs; if they would need advanced hair care, related to the particular product, they would decide to buy it even if its price was high or even if the market trends were not supportive towards the particular product. Activities 11 In Australia, the daily activities of people vary; professional activities are not the key part of daily life of local people; social and sport events are highly valued as part of everyday life of people in Australia. The particular product can provide to people advanced hair care, combining the good look with the increased hair protection in all daily activities. Lifestyle VALS type 12 For people across Australia, quality is most important than price; the specific product combines both quality and low price; thus, its expansion in the local market would be high under the terms that its promotion would emphasize on the daily needs of local people in accordance with their lifestyle. Behavioural Use of brand 13 For people in Australia, brand ensures the quality of the product, towards others of similar characteristics. Also, brand can ensures the continuous improvement/ update of a product, in order to meet the consumers’ needs. Finally, brand reflects the efficiency of a product in terms of the needs that this product is expected to cover. The specific product has all these characteristics, a fact that indicates its increased chances for success in the Australian market. Loyalty status 14 In Australia, loyalty is a key characteristic of the market (as also of daily social life); people are likely to be loyal regarding the products/ services they use on a daily basis. Palmolive is a well-known brand, well expanded in the international market, including Australia. Loyalty, as explained above, would be an advantage of the firm which have more chances, compared to its rivals, to get the support of locals. Readiness 15 People in Australia are expected to prefer products/ services that support their readiness towards various social and economic events. The specific product could help people with colored hair to prevent a damage of their hair, either in the short or the long term. For this reason, local people would welcome the specific product. Attitudes towards the brand 16 Brand has a key value for consumers in Australia. However, a product’s name in the market does not result to the lack of criticism on its quality. Brand affects the decisions of consumers in Australia, but only under the terms that the specific product/ service is of a particular standard of quality; otherwise, products/ services that are not so well known are likely to be preferred. 6.0 Reference List Australian Government (2011) People, Culture and Lifestyle. Web. Available from < http://www.dfat.gov.au/facts/people_culture.html> Dibb, Sally, Simkin, Lyndon. 2008. Marketing Planning: A Workbook for Marketing Managers. Belmont: Cengage Learning EMEA Doyle, Peter. 2008. Value-based marketing: marketing strategies for corporate growth and shareholder value. Hoboken: John Wiley and Sons Hiebing, Roman, Cooper, Scott. 2004. The one-day marketing plan: organizing and completing a plan that works. McGraw-Hill Professional IBIS World. 8 October 2010. Cosmetics, Perfume and Toiletries Manufacturing in Australia. Web. Available from Keillor, Bruce. 2007. Marketing in the 21st Century: New world marketing. Westport: Greenwood Publishing Group Lancaster, Geoff, Withey, Frank. 2007. Marketing Fundamentals 2007-2008. Oxford: Butterworth-Heinemann Leader, W., Kyritsis, N. 1990. Fundamentals of marketing. Cheltenham: Nelson Thornes Moore, Karl, Pareek, Niketh. 2009. Marketing: the basics. Oxon: Taylor & Francis Pride, William, Ferrell, O. 2008. Marketing. Belmont: Cengage Learning Ranchhod, Ashok, Gauzente, Claire, Tinson, Julie. 2004. Marketing strategies: a twenty-first century approach. Essex: Pearson Education Rushton, Alan, Croucher, Phil, Baker, Peter. 2010. The Handbook of Logistics and Distribution Management. London: Kogan Page Publishers Shah, Kruti, D’Souza, Alan. 2009. Advertising N Promotion. New Delhi: Tata McGraw-Hill Education Sloman, John. 2005. The economic environment of business. Essex: Pearson Education Stevens, Robert, Loudon, David. 2005. Marketing planning guide. London: Routledge Vashisht, Kujnish. 2005. A Practical Approach to Marketing Management. New Delhi: Atlantic Publishers Wedel, Michel, Kamakura, Wagner. 2000. Market segmentation: conceptual and methodological foundations. New York: Springer Read More