Marketing Plan

According to McDonald marketing planning is “a logical sequence of events leading to the setting of marketing objectives and a formulation of plans for achieving them. ” (McDonald 2002 POP) The complexity of marketing planning means that when organizations embark on it, they should expect to encounter a number of organizational, attitudinal, process and cognitive problems (McDonald 2002). This essay is an attempt to outline some of those problems, however it is beyond this essay to clarify all possible barriers in implementing a marketing plan.

After the potential barriers are of implementation re specified the essay will try and give possible solutions. The essay will first look at organizational constraints and then progress onto operational barriers. Organizational barriers It is not uncommon for marketing planners to experience difficulties in gaining wholehearted executive commitment for an ongoing programmed of, planning implementation and control. This is often due to a lack of evidence linking marketing planning to direct financial benefit. This problem is less prevalent in the other organizational disciplines of Management, Production, Finance and Human Resource.

Although marketing describes itself as the key business discipline- and rightly so if properly applied-vested interests often prevail to obstruct its centrality (McDonald 2002). In practice the other strands are able to flex varying degrees of muscle with the result that is often marginal’s. Part of the problem is that marketing is perceived as an abstract art form rather than a science. Although a new status- that of Chartered Marketer- has been accorded to qualifying members of the Chartered Institute of marketing (Ere. C. 2000), the level of public awareness is low.

A major cause for concern is that many organizations separate the three disciplines of business (production, HRS, AND marketing). The problem with separating the three disciplines is that there will be a lack of participation of the key functions of the company. This is why a market-orientated approach is needed. As far back as the sass’s Lear (1963) recognized the barriers involved and that, whilst marketing orientation was desirable from the point of view of customers, the efficiency based structure of most organizations limited what could be achieved.

Morgan and Pierce 1991) cite lack of proper training as a major inhibitor of marketing orientation this in turn can lead to weak systems and therefore weak, poorly valued marketing. Marketing orientation is of course a cultural issue. Smirch (1983) sought to define organizational culture as “something, which may be influenced, changed and What are the barriers to implementing a marketing plan and what can be done to overcome them? By divisions of an organization”. Smirch 1983 IPPP) In her article, Wilson (2000) quotes an assumption that “culture develops through problem solving within an organization but suggests that the lack of clarity of benefiting leaves us with the conclusion that culture is formed from a variety of external manifestations (observed as behaviors and processes) backed up by belief systems. This complexity may be the main reason why culture moves slowly- it involves changing behaviors and shaking beliefs”. Wilson 1998 UP) The slow acceptance of new cultural developments like market orientation and the convergence of departments could act as a barrier in the adoption and implementation of market planning techniques. Operational barriers The design and implementation process of marketing planning can be subject to numerous amounts of possible problems. Many companies have now opted for formalized marketing procedures, McDonald states that “introduction of formalized marketing planning systems have serious organizational and behavioral implications for a company as it requires a change in its approach to managing its business. (McDonald, 2002, POP) Unless businesses recognize these implications and seek ways of coping with these changes their planning could fail. This essay is now going to focus on possible operational barriers a business may face, when designing and implementing a marketing plan. McDonald states, “A major cause of failure or partial failure of marketing planning systems is the belief that once a system is designed, it can be implemented immediately. ” (McDonald 2002 POP) Businesses who subscribe to this view often fail to implement a timetable for their plans. This can cause them to not fully plan the planning process.

The inadequate planning could cause ineffective plans as they are not tried and tested, it could also cause them not being communicated successfully. McDonald discuss how “planning the planning process above all gives a resolute sense of purpose, and dedication is squired, tempered by patience and a willingness to appreciate the inevitable Possible problems can occur in the presentation of the planning terms. Confusion between members of an organization concerning the content of the marketing plan can be elevated due to perplex terminology and excessive amount of information and detail.

Planners are usually highly skilled and use expressions, which can be perceived by operational managers as meaningless Jargon (McDonald 2002). Elaborate systems can often be blamed for over planning. Over planning can create huge amount of data and information, which may not necessarily be needed. This can be De-motivating for all concerned and cause loss of focus to the main issues (McDonald 2002 POP). McDonald writes about how the once a year ritual culture is one of the most common weaknesses in the marketing planning systems (McDonald 2002).

Some Managers see the writing of a marketing plan as a troublesome activity, which is only completed to satisfy headquarters. This could lead to the plans being thrown aside and not properly completed or followed. McDonald states that “whilst this is obviously closely related to other explanations as to why some planning systems are ineffective, a moon feature of companies that treat marketing planning as a once a year ritual is the short lead time given for the completion of the process, managers tend to relegate it to secondary importance. (McDonald 2002 POP) Manager’s confusion over tactics and strategy form the foundations of why so many businesses become less profitable. McDonald articulates that “a tactical ‘plan covers in quite a lot of detail the actions to be taken, by whom, during a short term planning period. This is usually for one year or less. A strategic plan is a plan, which covers a period beyond the next fiscal year. Usually this is for between three and five years”. (McDonald 2002 POP) Previous decades have seen businesses using short-term tactical marketing.

Many businesses used their short-term tactical strategies as a Justification as to why they had been successful. McDonald is in disagreement with this and believes firms using these tactics were largely successful in the asses and ass due to the simple environment and the easy marketability of products and services (MacDonald 2002). The increased complexity of today’s markets has meant that businesses need to have a more strategic and long-term approach.

However McDonald explains that even when several businesses realize they need to take a more strategic approach they implement strategies, which are more sales forecasting and budgeting (McDonald 2002). The reason for this misguidance is that managers can confuse operational planning and strategic planning; some even argue that the two are separate entities, the figures that appear in the long-term corporate plan are little more than statistical extrapolations that satisfy boards of directors (McDonald 2002). This common misdemeanors subjects the operational and the long-term plans to begum divorced from each other.

The short-term plans become reactionary and the long-term plans lose their relevance and much needed cohesion and logic. McDonald explains, “This separation positively discourages operational managers from thinking strategically, with the result that detailed operational plans are created in a vacuum”. (McDonald 2002 POP) A real life example of a business separating tactics and long-term strategy was Ben and Jersey’s ice cream. Ben and Jersey’s had enjoyed good profitability until 1994 when their target market which consisted of exclusive high priced ice cream eaters shifted to more affordable ice cream.

This lead Ben and Jersey’s to re-evaluate their once alluring pricing strategy and engage in a price war, which ultimately meant a loss of profitability. Ben and Jersey’s lost market share because they failed to change themselves and adapt to a new competitive environment because of organizational inertia. To overcome this Ben and Jersey’s need to identify the changing tastes of consumers. To do this they need to develop a marketing plan, they showed no real evidence in doing this in the past.

Ben and Jersey’s reliance on cause-generated marketing (short- term) had its benefits of adaptability, however long-term marketing landing has focus. (Gilbert. G. 2001) The implementation of marketing planning is very reliant upon good information. Poor information can erect possible barriers in achieving business objectives. Piper and Smith conclude, “The basic logic of strategic planning is the production of a system which allows the matching of internal strengths with external opportunities whilst offsetting internal weaknesses and outside threats”. Piper and smith 2002 POP) The barrier to affectively achieving this is obtaining the right information Piper and Smith state that “poor information can be as damaging as ones made on intuition ND past experience” (Piper and smith zappy) A classic example of businesses gathering insufficient information was coca-cola. In the late ass and early ass coca-cola’s research found out that the taste of their product was not recognized as superior to the other cola drinks. This led coca-cola to change the taste. In testing the new and improved flavor they used blind test research.

The test concluded that a larger percentage of people choosing the new flavored coca-cola drink over any other drink. This led them to dramatically introduce the new flavor instead of the old one. Although initially this went well, people started started to stockpile the old coke and turn down the new flavor. Coca-cola received over 40,000 complaint letters and America even laid plans to file a class action lawsuit against coca-cola (Hartley 1998). Obtaining adequate research information from audits is very problematic and expensive.

Acquiring good information is often a barrier in the process of a good Solutions on design and implementation barriers Wicks writes an interesting article about how the marketing department within businesses must market themselves in order to gain good funding and support. Wicks argues that a too familiar story in business is that of marketing departments budgets being cut in poor times, which leaves a demoralized marketing team. To back this claim up a recent survey by the university of Warwick asked top managers if business was poor what would be the first thing cut.

In number one spot came marketing with 23% (Wicks 2002). To solve this problem Wicks argued that a similar approach to that of focusing externally on customers must be adopted internally. The customer is senior management and the competition is other department’s who are also partners, as they may share some of the budget if done correctly (Wicks 2002). Wicks states “the next step is to sell the department and relate everything to the goals of senior management and keep things simple”. Wicks 2002 UP) The convergence and inter department co-operation is largely a cultural thing. McDonald states “marketing is a management process whereby the resources of the whole organization are utilized to satisfy the needs of selected customer groups in order to achieve the objectives of both parties. Marketing, then, is first and foremost an attitude of mind rather than a series of functional activities”. McDonald 2002 IPPP) Rose (1990) proffered that success lies in engaging the employee with the goals of the Company… Aligning the wishes, needs and aspirations of each individual who works for the organization with the successful pursuit of its objectives. Hodges (2000) insist that companies seeking to survive in the ‘SO must create organizational design based on sharing authority, responsibility, and resources amongst people and divisions to achieve common goals. By this means, managers will be able to change their strategies, continually realigning their organizations with emerging opportunities, then articulating the new strategies so everyone knows what the organization is about.

The convergence of departments and non-isolation of marketing is crucial in the co- and how hierarchical change can be implemented. By centering an organization on its knowledge, and allowing free flow of that knowledge, it is possible to break down these barriers (Give. E. 2000). McDonald argues that one of the most debated issues in marketing planning today is where the responsibility for setting objectives and strategies should lie (McDonald 2002). What is not argued by McDonald is that short-tactics and long-term strategy would not be separated or misunderstood.

McDonald believes that operational planning and strategic planning should be very much part of the same process, he states that “wherever possible they should be completed at the same, using the same managers and the same information process”. The strategic plan should be completed first and cover a period of between three and five years and when this is completed the operational and more detailed plan should be created (McDonald 2002). McDonald concludes, “Never write the one year plan first and extrapolate it”. (McDonald 2002 IPPP)

The integration of tactics and strategy should stop the divergence of the short-term thrust of a business at the operational level from the long-term objectives of the enterprise (McDonald 2002). It should also prevent the preoccupation with short-term results at operational level, which according to McDonald makes a business less effective in the long run (McDonald 2002). Once the planning system is designed and tested a major problem that has to be avoided is the excessive planning and detailed as mentioned earlier.

McDonald maintains that in successful companies there is at all levels a wide spread understanding of the key objectives that have to be achieved and a means of achieving them. This cohesiveness is achieved by a means of layering. At each level management analysis is synthesized into a form that ensures that only the essential information needed for decision purposes reaches the next level (McDonald 2002). The presentation of strategic plans should be clear and concise. A good marketing plan should be no more than about a dozen Powering slides that can be easily read, understood, and shared widely.

It must support the overall business strategy and contain simple success metrics that link to the financial goals of senior management (Wicks 2002). As mentioned earlier the acquisition of good and reliable data can prove to be a barrier in the implementation of a marketing plan. Poor information could render a marketing plan unsuccessful. Alice College argues that researchers need to apply judgment and to have a broad base of knowledge and know how to integrate argues that a company should have good sound information flow and scan the environment thoroughly.

This could be done through adequate sources of information and internal databases of information. This should lead to more detailed forecasting and limited possible problems. In concluding a business should strive for a culture, which embraces cross- departmental involvement in marketing. Marketing should be state of mind in every member of an organization. The marketing planning structure should be adequately planned and tested. A business should have a systematic procedure with a common format.

The long-term strategic plan should cover between three and five years and be interlinked with the one-year operational plan. Within the plans a systematic system should be developed to prioritize objectives and interlinked them. The environment should be thoroughly scanned and information should be passed up he channels through a laying system, which only allow relevant information to be passed on. Conclusion Marketing planning is a series of activities concerning objectives, auditing, analysis and assumptions.

The complexity of it renders it subject to possible problems and barriers. Organizational culture and management ignorance are major barriers in implementation of a marketing plan. Some organization seem to not merit the possible benefits of strategic planning, they cut marketing budgets and isolate the department. Managers can confuse the short-term plans with the long-term plans. Short-term plans are often prepared first which regularly means they are reactionary and discourage managers thinking strategically.

Organizations should create a culture, which embraces marketing, it is, and should be a state of mind, with all departments involved. Organizations should develop the strategic long-term plan first and then create the short-term operational plans. The marketing planning process should be structured and planned extensively, with objectives listed in importance. Marketing planning and implementation face many barriers however following structured and planned models can avert and foresee potential problems.

Source from Australia government shows that Fruits and vegetables are still an important part of your diet and may play an indirect effect with a healthier weight cause they are relatively low in kilojoules (Better Health Channel, Cancer and food, 2014) This is an opportunity for Smart Banana because High fiber property of banana enables them to absorb numerous calories before passing to the digestive tract, it can help to solve the problem of people getting overweight and help people who want to have better body shape.

Refer to source from Smart banana, it shows that it is the first banana vending machine provider (Smart Banana Official). This is a strength and but also a threat for Smart Banana company . An the strength side, eying bananas in banana vending machine is a more convenient way for people to buy than buying in supermarkets. It is because they can reach the position that don’t have any shops like bus stops, school etc. On the threat side, bananas is different to other vending machine products like can or bottle drinks, they cannot keep fresh for more than a week even in cool temperature.

It’s a technology problem for Smart Banana to keep their bananas fresh before the bananas sold out. 2. Marketing Goal Have over 50% of main Australia offices and schools area’s bus stop have installed the banana vending machines in 2 years 3. Marketing Strategy Smart banana is the first banana vending machine provider in Australia, the value it can give to their customers are convenient diet eating . To target the customers , it will base on behavioral segmentation and cryptographic segmentation mix .

First of all , based on behavioral segmentation , people place more importance on diet eating In 21 century . Research from source of World Health Organization, Fruit and vegetables are important components of a healthy diet, if people can eat egg of fruit or vegetable daily , it can highly prevent diabetes and obesity (World Health Organization [W. H. O. , Promoting fruit and vegetable consumption around the world ), Because of these reasons since 2013 WHO and FAA have started to promote Basic Marketing Plan By Lam-Yuk people about the importance of diet eating .

It is highly affecting people’s eating behavior especially teenagers which is trying to eat more vegetable and fruit in order to be healthy because their ages have the education of diet habits. Second, based on cryptographic segmentation, a banana vending machine is definitely a new method for people to buy fresh banana in the street. It is different to the traditional way to buy bananas in markets or supermarkets. Because of that, innovators will be select as the target customers instead of other life style because this group of people are viewing to try new things.

A new method to buy fresh banana would be suitable for them. Refer to the above information, Smart banana is the best banana vending machines provider for teenage innovators because teenagers are usually students or employees which are the group of more busy to have balance diet population. To aim this situation, banana vending machine can provide the value of “instant, no preparation, convenient positioning” healthy food for them. Secondly, because they re the group of people which have educated the knowledge about the importance of diet eating, a vending machine is an easy way to reach them.

Third, innovators have strong receptivity of the newborn objects, banana vending machines create a modern fruit buying method to the target customers.

A Bite of Innovation Marketing Plan Presented by: Angela Roomer-Monsoonal Presented to: Proof. Perpetual MAKE 649-3 SUB Apple is a top tier consumer electronics manufacturer that differentiates itself by offering design-oriented, user-friendly, innovative, and hip products at premium price. Steve Jobs, a charismatic entrepreneur that pioneered the personal computer, the mobile computing, and the digital music industry, led Apple. Unfortunately, Jobs passed away in 2011 and Timothy Cook took over as CEO. Apple introduced the Classic pod, a portable music player, in 2001.

The main features of the Classic pod were a sleek design, ultra portability, up to 5 Gigabytes of storage, 10 hours of battery life, and an easy-to-use interface at a price tag of $ 399. Since its beginnings, Apple has diversified the pod into many other models as a way to reach different target markets by offering a wide range of price points and features. The price points in 2012 range from $50 for the pod Shuffle to the pod Classic, which retails at about $230 1 . Although not everybody owns one, the pod is a mass-market product because of its broad appeal. In the words of Steve Jobs, “music is a large target arrest”.

The primary target market for the pod segmented by demographics is teens to young adults belonging to middle and high class. For example, 66% of pod users have an income of $25,000 or above. According to CNN Tech, 69 percent of pod users are between the ages of 13-24 2. Lastly, the pod is a product that appeals more to males than females. According to Stauncher “the median number of pods owned for males is 2, while the median number for females is 1″3. Segmented by chirography’s, pod’s customers are people who enjoy music, “cool” products, gaming, and cutting-edge technology.

Customers can also be segmented by the speed at which they adopt a new technology, a process called the diffusion of innovation. Figure 2: pod Sales per Fiscal Quarter Chart illustrates the diffusion of innovation curve for the piped. During 2001 and 2002, the innovators;technophiles, By kepi The next segment were the adopters, who were interested in the “cool” factor of the product. During 2005, the early majority adopted the product; the sharp increase in sales in the graph represents this moment. After 2005, the late majority accepted the pod, making it a mass-market product.

Another reason for the surge in sales that occurred in 2005 was the release of different pod models, such as the Anna, Mini, and Shuffle. This extended product line propelled pod sales through the proverbial roof, reaching 40 million in 2006. Up-to-date, the pod has sold over 270 million units. Source: Online Marketing Trends, 2011 An environmental scan for Apple reveals several important factors that might affect its direction and actions. For example, the pod is positioned as an industry leader, commanding 73. 3% of the AMP player market.

Figure 2: pod Takes a Big Bite, illustrates the market share for AMP media players. The next close competitor is Candies, which has 9% of the market share. Its core product is the Sans Clip Zip AMP Player, which retails for $49. This AMP player resembles the pod and it offers similar features at a fraction of the price. However, it doesn’t have the brand recognition and loyalty the pod has. Source: NYPD Group, 2009 Apple faced legal issues with record labels and media companies, which claimed that the pod facilitates the use of pirated digital content.

As a solution, Apple unveiled tunes in 2003, which is an online music and video store. More importantly, Apple faces legal and reputation problems in the area of supply chain management. Some of Apple’s largest suppliers have been accused of illegal labor practices and sweatshop-like working conditions. Foxing, a key supplier, has been under investigation for the high rate of suicides in its factory as well as a couple of explosions. Pageantry Corp.., which is another important supplier, was recently in the news for a factory explosion, which injured 61 and hospitalized 23 employees.

While the U. S. Government was not involved, the Chinese government and several Nags were investigating the case. If not managed properly, this situation could be a public relations nightmare for Apple, now that it has claimed the title of most valued company in the world. The pod was envisioned for customers on the go, who value style and entertainment. The pod’s core product benefits are mobility, functionality, style, and entertainment. The pod is portable handheld device that delivers entertainment–music, video, and games;and Internet connectivity through Wi-If.

Lastly, the pod’s design is intuitive and stylish, appealing to a wide sector of the population. However, Apple recognizes that not all the population has the same n attempt to reach additional market segments, by offering a wide price range and diverse product characteristics. Specifically, Apple has created four main devices with incremental price points and features. The pod shuffle is the lowest price point, retailing for $50. It is a small, sleek, and portable AMP player. This product is aimed a people of lower income and socioeconomic status.

The pod Anna has a middle range price point, retailing at $130. This product is has an LCD screen and it plays music and videos. It also has a camera and comes with pre-installed applications. However, it is unable to run third-party applications, such as games. The most popular product is the pod Touch, which retails at $200. This product is aimed at gamers, primarily white male teenagers. Steve Jobs said, “it’s [pod Touch] a cheap gaming device, and Apple wanted to concentrate on getting the price down to the magic $200 price point” 8.

Finally there is the pod Classic, which sells for $230. This product is aimed at people who value high storage capacity and music quality, such as music collectors. Since the pod is a product with a wide appeal, the ideal distribution Hansel must reach the mass markets. Big box retailers, such as Wall-Mart and Target, are ideal channels because of their large sales volume and market reach. Also, a proprietary company website, such as Apple. Com is necessary to explain the product benefits, to maintain brand image, and to engage in direct sales.

However, an Apple Brick and Mortar store is also necessary to showcase its products and to allow customers to experience the pod. Currently, Apple has 300 retail stores in the world and they are the most profitable stores measured in terms of sales per square feet. This a key element in the marketing plan because when experiencing the product in a controlled and designed environment, like an Apple store, the brand image is going to be reinforced in the consumer’s mind. The last main channels of distribution are online retailers, such as Amazon and Overstock. Com.

These retailers play a key role because consumers are shifting towards online shopping and Apple wants to reach as many consumers as possible. Advertising is the best way to promote a mass-market product, like the pod. In other words, advertising is the best way to communicate and persuade buyers to purchase n pod because it has the largest reach. Apple has crafted a precise image for its products portraying them as hip, high tech, and urban. Moreover, the pod’s advertising campaign was presented in mass-media channels, such as billboards, TV commercials, and print ads.

The print ads were published in magazines that targeted technology lovers, such as Wired Magazine. It also placed pod ads in magazines targeted to men, such as Sports Illustrated. By advertising in magazines targeted to men and technology lovers, Apple is able to reach its primary target market of male teenagers and young adults. TV commercials, featuring the iconic anonymous black silhouettes dancing to a new pop song, are another main pillar supporting Apple’s image.

All ads feature dark silhouetted hip, young people who are dancing with the pod and its white headphones, contrasted with a bright colored background. The first campaign had the slogan of “1,000 songs in your pocket”11. Since the original campaign, Apple has unveiled several others, such as Dance, Vertigo, and Grid. Also, appeal to the young and trendy target market. Moreover, Apple targets specific racial groups by using traditional music, dance, and language from that particular group.

For example, Apple unveiled the pod 56 with a commercial in Spanish called Mi Swing Sees Tropical, Spanish for my dance moves are tropical 2. The commercial features young and stylish characters dancing salsa and other tropical rhythms dressed in traditional Latin outfits. This commercial was aired in TV Aztec, Telemeter, which are traditional Latin TV stations, but it was also aired in NBC during Heroes, the most popular TV show in 2007. Apple has targeted the teenage market by partnering with MET Music Video. In fact, several pod commercials were either shown or premiered in the MET Video Music Awards 13.

As a result of these campaigns, the pod not only became a mainstream product, but also a pop culture phenomenon. In conclusion, Apple has unveiled one of the most influential products of the 21 the century, the pod. The pod has not only revolutionized the way we listen to music, but also how we entertain ourselves. Apple ha created a product with a broad appeal and it has marketed the pod brilliantly, to the point of becoming a pop culture phenomenon. In fact, some critics say that the pod was the saving grace for Apple, which was struggling with weak finances and a blemished brand before.

Abstract

The following report considers the ethical position of ASDA, noting the external environment in which it operates and its marketing plan.The report finds that ASDA’s focus on low prices has somewhat disengaged it with ethics, with the business more focused on selling volume, as opposed to selling sustainable products. However, given changes in the external environment, and the rise in the discount retailers, ASDA has now been faced with higher competition. To combat this, the report suggests that ASDA looks to change its strategy to focus more on a sustainable supply-chain, potentially one which is focused on UK food and products. While this may lead to higher prices from the retailer, it could improve its image when it comes to sustainable food retailing, and so warrant higher prices to consumers, especially if the introduction of local products develops an emotional attachment for customers.

Introduction

The following assignment will consider ASDA, considering the external environment in which the business operates as well as its ethical consideration, determining whether the current strategy should be maintained or whether a change is needed, with the assignment then making recommendations.

Company Overview

ASDA is a UK-based grocery retailers owned by U.S. listed Wal-Mart Stores Inc. ASDA has been part of the UK’s ‘Big 4’ retailers in the UK grocery sector, also compromising of Tesco, Morrison’s and Sainsbury’s, however it recently moved from 3rd from 2nd place on the list, being overtaken by Sainsbury’s after disappointing sales. The latest report from Kantar Worldpanel (2016) put’s ASDA’s market share at 15.3%, behind that of Sainsbury’s after suffering a 4.7% fall in sales, compared with a 0.7% fall in Sainsbury’s, and a 1.6% rise in sales at Tesco. To many UK consumers, ASDA has developed on the back of price competition, with the retailer being heavily focused on being the UK’s best value supermarket. Due of its focus on price, ASDA in the past could have been seen to ignore ethical consideration, with some of the top places seen with premium retailers such as Marks & Spencer, who use their premium pricing to better consider the quality/ ethics behind their supply chain.

Market Environment

However, it is this strategy which has been a downfall for the retailer, especially when put against competition from the expanding ‘discounter’s’, namely Lidl and Aldi (Ruddick, 2014). These retailers have aggressively expanded into the UK market on the back of offering low prices to consumers, with their focus on ‘prime-match’, similar of marketing conducted by ASDA against the other ‘Big 4’[1]. Given this, Aldi managed to record sales growth of 10% over the same period, beating all competition and increasing its market share to 6.2%. At the same time, Aldi also announced that it looks to take its store tally from 450 to 1,000 by 2022; Lidl also announced plans to open 40-50 new stores in the UK each year, noted by Gale (2016). This move in the market has been supported from a new business model and changing consumer habits. Discounters have benefitted from economies of scale, reducing the scale of choice to offer just one option; in turn allowing them to increase sales of that product and reduce the production costs. At the same time, these discounters have also expanded on a no-frills approach to stores, moving away from the ‘Superstore’ concept which became popular with Tesco and ASDA. This comes at a time when consumers have also looked to move away from superstores, preferring little-and-often shops to better budget. There also seems to a reduction in customer loyalty as consumers look for the best value.

Marketing Situational Analysis

Building on the above, a SWOT analysis is shown below;

Strengths

·UK wide presence with 525 stores.

·Still the UK’s 3rd largest grocery retailer – potential to increase share.Weaknesses

·Recent marketing seems to have placed it in the ‘discount’ category when it comes to grocery stores – potentially restricting sales of some of its higher-value items.
Opportunities

·Recent improvement in UK economic fundamentals – coupled with rising wages may increase consumer disposable income.

·Fall in ?GBP has put some spotlight on UK food/ products to escape price rises.Threats

·Competition remains the biggest threat to ASDA, especially with discounters such as Lidl/ Aldi quickly expanding their store network, as well as expanding their marketing activities, with a focus on value.

Ultimately, the analysis is suggesting that the main weakness in marketing lies within this continued focus solely on the price. This has come under pressure given new entrants into the market, with the discounters of Lidl/ Aldi coming into the market with business models which mean they can potentially undercut ASDA on prices. This is the main threat to the business, with ASDA still seeing a fall in sales, even with the recent buoyancy in UK retail sales. However, there are potential opportunities for ASDA to diversify, expanding its marketing to cover issues within sustainability and UK produce; improving the ethics when it comes to food sourcing, and issues such as food security and locality[2].

Objectives

In the past, ASDA’S objectives have been focused on customer value, however given an expanding ‘discount’ sector, the retailer is now under more pricing pressure to maintain customers. With this, there is the expectation that the retailer may need to diversify, essentially look to attract more customers back to its stores. The objective for ASDA is to tempt customer’s back into its store; or tempt new customers back. Given continued expansion of Lidl/ Aldi, it could be expected that the new strategy will need to focus more on attracting new customers, be it from retailers such as Sainsbury’s.

Strategy & Segmentation

To support its strategy, ASDA will look to segment the market into different consumers, based on demographics, location, income etc. Given marketing campaigns undertaken by the business, it would appear that ASDA has segmented the market; looking to appeal to those families of lower incomes. Its focus on being the cheapest is indicative of its primary target market. Because of this, the business has become somewhat specialised on this business model, a focus on low-cost, which in turn could impede quality. It has positioned itself in the low-cost end of the market, however given new entrants and intensified competition, is now finding it hard to compete and develop with new competition (Peter, 2011)[3]. The business model helped ASDA over the years of recession given constrained consumer income, however as economic conditions have improved, consumers have essentially traded-up. This has provided support to other retailers such as Sainsbury’s, and Waitrose which position themselves at the higher end of the market.

With this, ASDA may feel that its business is currently positioned to narrow, targeting a consumer base which is shrinking which competition is increasing. There are two ways in which the retailer can broaden its consumer base, either through changes to marketing which will target a new market, or by differentiating the product to appeal to a broader base of consumers, noted in Armstrong et al (2012)[4].

Tactics & Action

Given the above, the main tactic for ASDA s to re-position itself in the market, remove this constant focus on price and look to focus more on ethical issues such as sustainability, which in turn may suggest quality. To do this, the retailer has a number of actions:

ASDA will move to focus on local; putting its focus on supplying more UK produce in-stores, having dedicated aisles in superstores to local producers. The benefit here will not only be from higher sales of these goods, put also of the positive PR which could arise through supporting local farmers, and local communities. This is essentially classed as differentiation; the retailer will be introducing new products to do so.
ASDA will also look to introduce convenience aisles into superstores. This will be seen as segmentation,[5] looking to attract a new set of customers to its stores who may have previously left as they prefer to do ‘little-and-often’ shops. This can be marketed by ASDA to target these specific customers.

Budget

This section will now discuss the budget for such a change in strategy. The main costs to the business will be seen as the marketing. For instance, when it comes to the ‘convenience aisle’, it could be noted that the infrastructure is already there; the stores will simply have to shuffle around stock to create the new aisle. When it comes to introducing the new products, the costs may be more down to developing the local links, with the suppliers themselves bearing the costs associated with producing the goods. Rather than a major financial cost, the introduction of more local products may be more time consuming for ASDA, given that they will need to ensure that the new products are in-keeping with the goals of the business, both in terms of pricing and quality (Ferrell, 2012)[6].

Marketing will be done through all ’traditional’ channels given the mass-market appeal of ASDA and the fierce competition within the UK grocery sector. While this would involve a higher cost than say digital marketing opportunities, it would be hoped that print advertisements and TV commercial will draw more attention, and so inform more customers. However, digital marketing could also be used, especially when it comes to advertisements through social media, and targeted banner ads which can be used online.

Control

Control remains an important consideration, both in terms of ensuring a level of consistency in the marketing message as well as also monitoring the return on investment (hereafter ROI). When it comes to consistency, while marketing could change to reflect changes in the marketplace, the business must look to maintain its ‘core’ message. For instance, while the focus on new marketing campaigns may be on local produce, the core message remains with the slogan ‘Save Money, Live Better’. Too much of change may lead to current customers becoming detached with the business and its values.

Control will also come with ROI. Essentially, all businesses need to ensure that their marketing spend is generating business. New, digital marketing allows businesses to track this, with businesses able to use tools such as Google Analytics to view web traffic etc. (Chaffey, 2012)[7]. Traditional marketing may be harder to manage in terms of ROI, given that it is harder to distinguish how a certain poster/ TV commercial may have driven demand. However, if ASDA move forward with a unified campaign, so changing all marketing to reflect a single message, then the business can understand the potential ROI of the campaign.

Recommendation/ Conclusion

To conclude, ASDA has in the past focused its marketing plan on price, looking to drive consumption through low prices. This is itself would not be considered ‘ethical consumerism’, given that some of the lower prices products could be viewed as a damage to the environment. However, this strategy has now placed ASDA into a market segment which is seeing more competition, at a time when the size of the market may be slowing, given improving economics in the UK[8]. To combat this, ASDA has an opportunity to diversify its product range into a more ‘premium’ space; be it the expansion of their ‘Extra Special’ range, or through the introduction of more local products and brands (Perreault, 2010)[9]. The focus on UK produce could provide ASDA with a ‘Unique Selling Point’; which could allow the business to justify higher pricing, noted in Fifield (2012)[10]. This may also improve the organisations ethical position as it suggests that ASDA is considering sustainability in its wider supply-chain; given that more food is local, opposed to international, reducing the ‘distance’ of the supply chain, potentially being seen as more environmentally friendly. However, at the same time, the retailer must be wary that any change to its pricing may impact on its core customers. In the end, this may further impact on market share, however this is seen as a potential risk of an opportunity. The recommendation for ASDA is that is moves forward with a change in marketing, highlighting developments in both local sourcing as well as convenience. However, ASDA must look to control this movement, and potentially monitor the opportunity. This could be done through monitoring sales of, as well as monitoring footfall into stores.

References

Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2012). Marketing: an introduction. Pearson Prentice-Hall, London.

Chaffey, D., & Ellis-Chadwick, F. (2012). Digital marketing, London, Pearson Higher Ed.

Ferrell, O. C., & Hartline, M. (2012). Marketing strategy, text and cases, London, Nelson Education.

Ferrell, O. C., & Fraedrich, J. (2015). Business ethics: Ethical decision making & cases, London, Nelson Education.

Fifield, P. (2012). Marketing strategy, London, Routledge.

Gale. (2016) [Online]. How long will Aldi and Lidl’s onslaught last?, Available at http://www.managementtoday.co.uk/long-will-aldi-lidls-onslaught-last/future-business/article/1386497, Accessed 17.12.2016.

Kantar Worldpanel. (2016) [Online]. UK Grocery Market Share, Available at http://www.kantarworldpanel.com/global/grocery-market-share/great-britain, Accessed 17.12.2016.

Perreault, W. D. (2010). Essentials of marketing: A marketing strategy planning approach, London, Pearson.

Perreault Jr, W., Cannon, J., & McCarthy, E. J. (2013). Basic marketing, London, McGraw-Hill Higher Education.

Peter, J. P., & Donnelly, J. H. (2011). Marketing management: knowledge and skills: text, analysis, cases, plans, London, Pearson.

Ruddick, G. (2014) [Online]. It may already be too late for Tesco and Sainsbury’s, the rise of Aldi and Lidl looks unstoppable, Available at http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/10974773/It-may-already-be-too-late-for-Tesco-and-Sainsburys-the-rise-of-Aldi-and-Lidl-looks-unstoppable.html, Accessed 19.12.2016.

Wood, S., & McCarthy, D. (2014). The UK food retail ‘race for space’and market saturation: A contemporary review. The International Review of Retail, Distribution and Consumer Research, 24(2), 121-144.

Currently, the market is saturated with below to average products that only mask the problem. Preserves will eliminate the problem effectively up to 5 days, even after showering. With the current hygiene relationships in place (with both consumers and businesses), brand quality and brand trademarks is not expected to be problematic. The principles on which Remount Corporations were founded will continue to be the foundation and cornerstone of the market. II. Situation Analysis Preserves is entering its initial launch into the anti-perspiration market. Its initial launch will determine the investments to Preserves.

Preserves will proceed with ending from the existing hygiene products until enough revenue is generated. Preserves is possibly looking for international endeavors. A. Market Summary Remount possess inside intelligence about the market. With the knowledge of the past market flow for the previous 20 years, Preserves is a definite necessity and will excel in the present market. I. Target Market a. Fitness b. Sports I. Adolescent it. Professional Airwoman Marketing Plan By animation b. Market Demographics The following geographic, demographics, and behavior factors are for Preserves products. I.

Geographical 1. There is no set target geographic area. 2. Overall general use is expected for the product. 3. Targeted population is approximately 100 million people across the country. Demographics 4. The ratio is greater between male and female. 5. The age ranges for the target market are as followed: a. The fitness market will range from late teenagers to the early adulthood, ages 18-40. B. The sports market will range from high school adolescents to professional athletes and extreme sports. The high school adolescents’ ages will range from 14-18. The professional athletes will range from 20-45.

The extreme sports market will range from those within the ages between late ass to mid-ass. Iii. Behavior Factors 6. Adults have an average of $32,000 annually income. With an estimated $175 monthly to spend on hygiene products. Necessary products for fitness and cleanliness. 7. Adults will spend on 8. This product is promoted for those who have active fitness lifestyles of 3 or 4 times weekly. C. Market Trends Preserves will distinguish itself by offering an irreplaceable need to the market. There are products in the market that are ineffective at reducing the smell after the perspiration forms.

The extreme and professional and high school sports would be the market that would be targeted more aggressively. Each target market would be focused on intensely. D. SOOT Analysts ‘v. Strengths 9. 20 years of hygiene experience 10. Ingenious product 11. Controls the perspiration 12. Length of time it lasts v. Weaknesses 13. Brand awareness to a new product 14. Chemicals used to make product 15. Staining of clothes v’. Opportunities 16. Become forerunner in the anti-perspiration market consumer’s needs vii. Threats 18. Existing products 17. Expand to fit 20. Brand trademarks for existing brands .

Competition Preserves will have to pursue customers who are already loyal to particular brands. Breaking brand loyalty will be a challenge, especially with brands that have been on the market for a long time. Preserves is the competing for the leading brand in the viii. Degree Degree claims to be 3 times stronger than any clinical strength deodorant in the market. It claims that the more work you do, the harder the product works on keeping your perspiration too minimum. They guarantee that you can depend on Degree, even in the toughest situations. “Our strongest wetness and odor protection yet!

Stay ahead of sweat with a product that’s as strong as you are. Prescription strength wetness protection with XX the power of a basic antiperspirants . And now also Degree with motionless, so the more you move, the more it protects. ” (Degree, 2013) ix. Suave Suave promises to serve 24-hour protection from underarm wetness by providing over the counter prescription strength ingredients. It even comes with fresh scents in order to distinguish themselves from the other products on the market. (Suave, 2013) x. Secret Secret is endorsed to be proven to work even harder under added stress.

It provides restriction strength clinical protection. They advertise to have to protection needed in order to satisfy their consumers. (Secret, 2013) Ill. Marketing Strategy This strategy will provide in depth insight in order to conquer the competition and become leaders in the target market. F. Mission “Preserves exists in order to deliver significant results and provide outstanding customer service. Providing maximum solutions to consumers will ensure success with positive feedback. ” g. Target Market The anti-perspiration market will be an enduring test of Preserves. IV. Financial h.

Executive Summary This five-year marketing plan for Tulip Clothing has been created to secure additional funding for growth and to inform employees of the company’s current status and direction. Although Tulip was launched in the I-JAKE only three years ago, the firm has experienced greater-than-anticipated demand for its products, and research has shown that the target market of sport-minded consumers and sports retailers would like to buy more casual clothing than Tulip currently offers.

In addition, Tulip plans to explore opportunities for online sales. The marketing environment has been very exceptive to the firm’s high-quality goods – casual clothing in trendy colors with logos and slogans that reflect the interests of outdoor enthusiasts around the country. Over the next five year, Tulip can increase its distribution, offer new products, and win new customers. 2. Company Description Tulip Clothing was founded three years ago by entrepreneurs Domain Thomas and Geoff Compton.

Tulip Clothing reflects Damson’s and Geoff passion for the outdoors. The company’s original cotton T-shirts, caps and denim Jackets bear logos of different sports such as kayaking, mountain climbing, bicycling, skating, surfing, and horseback r camel riding. But every item shows off the company’s slogan “Let’s Rock! “. Tulip sells clothing for both men and women, in the hottest colors with the coolest names – such as sunrise pink, sunset red, twilight purple, desert rose, cactus green, ocean blue, mountaintop white, and river rock grey (Thomas 2011).

Tulip attire is currently carried by small retail stores that specialize in outdoor clothing and gear. Most of these stores are concentrated in ABA Dhabi and malls in the northern Emirates. The high quality, trendy colors, and unique message of the clothing have gained Tulip a allowing among consumers between the ages of 25 and 45. Sales have tripled in the last year alone, and Tulip is currently working to expand its manufacturing capabilities. Tulip is also committed to giving back to the community by contributing to local conservation programs.

Ultimately, the company would like to develop and fund its own environmental programs. This plan will outline how Tulip intends to introduce new products, expand its distribution, enter new markets, and give back to the community. 3. Tulip’s Mission and Objectives Tulip’s mission is to be the leading producer and marketer of personalized, casual looting for consumers who love the outdoors. Tulip wants to inspire people to get outdoors more often and enjoy family and friends while doing so. In addition, Tulip strives to design programs for preserving the natural environment.

During the next five years, Tulip seeks to achieve the following financial and nonofficial goals: Financial Objectives: Obtain financing to expand manufacturing capabilities, increase distribution, and introduce two new product lines. Increase revenues by at least 50% each year. Donate at least ADD 25,000 a year to conservation organizations. Nonofficial Objectives: Introduce two new product lines-?customized logo clothing and lightweight luggage. Enter new geographic markets in neighboring ICC countries. A Five Year Marketing Plan For Tulip Clothing By instinct retailers.

Develop its own conservation program aimed at promoting environmental awareness in local communities. 4. Core Competencies Tulip seeks to use its core competencies to achieve a sustainable competitive advantage, in which competitors cannot provide the same value to consumers that Tulip does. Already, Tulip has developed core competencies in (1) offering a high- laity, branded product whose image is recognizable among consumers; (2) creating a sense of community among consumers who purchase the products; and (3) developing a reputation among retailers as a reliable manufacturer, delivering the requested number of products on schedule.

The firm intends to build on these competencies through marketing efforts that increase the number of products offered as well as distribution outlets. By forming strong relationships with consumers, retailers, and suppliers of fabric and other goods and services, Tulip believes it can create a sustainable competitive advantage over its rivals. No other looting company can say to its customers with as much conviction “Let’s Rock! “. 5. Situation Analysis The marketing environment for Tulip represents overwhelming opportunities. It also contains some challenges that the firm believes it can meet successfully.

A SOOT analysis of the company highlights Tulip’s strengths, weaknesses, opportunities, and threats. Drawing the right conclusions from a SOOT analysis is the most important purpose of performing the analysis (Kettle 2009). Strengths: Tulip’s dedicated founders understand the target market and product. Tulip has achieved distribution in several markets with quick acceptance. Tulip has very little debts with great potential for growth. Tulip works with a single manufacturer, allowing high quality control levels. Weaknesses: Tulip’s founders may lose sight of the potential scope of the business.

A limited number of consumers around AAU are aware of the Tulip brand. The firm has limited cash flow. Tulip relies on a single manufacturer which limits the production capacity if the firm wants to expand. Opportunities: Tulip’s loyal customers are likely to buy more products. Gaps exist in the AAU market that can be filled with new products such as customized looting items and luggage. The key challenge in filling these gaps is in the shaping process that allows ideas to move forward; to be processed and refined in a way so that management can “pick the winners” (Floorn & Freshman 2012).

Tulip has a chance to expand across the ICC into new markets. The firm can reach more consumers via a website. Threats: Consumers may tire of the concept and the firm needs to keep it fresh. Larger competitors such as Marks & Spencer or Timberland may establish a similar product line. Clothing sales have generally been flat over the past few years, even though I-JAKE as the highest fashion spending in the developed world (Cambridge 2011). Relationships with retailers may deteriorate if they feel internal competition from the internet site. The SOOT analysis presents a thumbnail sketch of the company’s position in the marketplace.

In Just three years, Tulip has built some impressive growing number of brand-loyal customers, and sound financial management place the company in a good position to grow. However, as Tulip considers expansion of its product line and entrance into new markets, the firm will have to guard against marketing myopia (the failure to recognize the scope of its business) and quality ellipses. As the company finalizes plans for new products and expanded Internet sales, its management will also have to guard against competitors who attempt to duplicate to products.

However, building strong relationships with consumers, retailers, and suppliers should help thwart competitors. 6. Competitors in the Outdoor Clothing Market The outdoor retail sales industry sells about ADD 50 million worth of goods in the AJAX annually, ranging from clothing to equipment. The outdoor apparel market has many entries. L. L. Bean, ERE, Timberland, Bass Pro Shops, Caballero’s, and Patagonia are mongo the most recognizable companies that offer these products. The outlook for the industry in general and Tulip in particular is positive for several reasons.

First, consumers are participating in and investing in recreational activities that are near their homes. Second, consumers are looking for ways to enjoy their leisure time with friends and family without overspending. Third, consumers are gaining more confidence in the economy and are willing and able to spend more. Tulip’s clothing is made of strictly the highest quality cotton, so it may also be worn around town. Finally, Tulip products are offered at moderate prices, making them affordable in multiple quantities. For instance, a Tulip T-shirt sells for ADD 99. 9, compared with a competing high-performance T-shirt that sells for ADD 149. 99. Consumers can easily replace a set of shirts from one season to the next, picking up the newest colors, without having to think about the purchase. Strategically assessing customer behavioral expectations is the focal point to understanding and improving service quality (Barber & Goodman 2011). A survey conducted by Tulip revealed that 67% of espousing consumers prefer to replace their casual and active war more often that other clothing, so they are attracted by the moderate pricing of Tulip products.

In addition, as the trend toward health-conscious activities and concerns about the natural environment continue, consumers increasingly relate to the Tulip philosophy as well as the firm’s contributions to socially responsible programs. 7. The Target Market The target market for Tulip products is active consumers between the ages of 25 and 45 – people who like to hike, bicycle, kite surf, indoor ice skate, ride horses or camels, and other such activities. They might not be experts at the sports they engage in, but they enjoy themselves outdoors.

These active consumers represent a demographic group of well-educated and successful individuals; they are single or married and raising families. Household incomes generally range between ADD 200,000 and ADD 600,000 annually. Despite their comfortable incomes, these consumers are price conscious and consistently seek value in their purchases. Regardless of their age (whether they fall at the upper or lower end of the target range), they lead active lifestyles. They are somewhat status oriented but not overly so.

They like to be associated with high-quality products but are not willing to pay a premium price for a certain brand. Current Tulip customers tend to live in ABA Dhabi and the northern Bahrain, Kuwait and Saudi Arabia as well. 8. The Marketing Mix The following discussion outlines some of the details of the proposed marketing mix for Tulip products. A. Product Strategy Tulip currently offers a line of high-quality outdoor apparel items including cotton T- shirts, caps, and denim Jackets. All bear the company logo and slogan, “Let’s Rock! “.

The firm has researched the most popular colors for its items and given them Ames that consumers enjoy – sunset red, sunrise pink, cactus green, desert rise, and river rock grey, among others. Over the next five years, Tulip plans to expand the product line to include customized clothing items. Customers may select a logo that represents their sport – say hiking. Then they can add a slogan to match the logo. A cap with a bicyclist might bear the slogan, “Take a Spin. ” At the beginning, there would be ten new logos and five new slogans; more would be added later.

Eventually, some slogans and logos would be retired, and new ones introduced. This tragedy will keep the concept fresh and prevent it from becoming diluted with too many variations. The second way in which Tulip plans to expand its product line is to offer items of lightweight luggage-?two sizes of duffel bags, two sizes of tote bags, and a daypack. These items would also come in trendy and basic colors, with a choice of logos and slogans. In addition, every product would bear the Tulip logo. B.

Distribution Strategy Currently, Tulip is marketed through regional and local specialty shops scattered across malls in ABA Dhabi and in the northern Emirates. So far, Tulip has not been strutted through national sporting goods and apparel chains. Climate and season tend to dictate the sales at specialty shops, which sell more T-shirts and caps during warm weather and more denim Jackets during colder months. Over the next three years, Tulip seeks to expand distribution to retail specialty shops throughout the ICC, focusing next on neighboring countries to the AJAX.

The firm has not yet determined whether it would be beneficial to sell through a major national chain such as ERE or Bass Pro Shops, as these outlets could be considered competitors. In addition, Tulip Lana to expand online sales by offering the customized product line via Internet only, thus distinguishing between Internet offerings and specialty ship offerings. Regardless of its expansion plans, Tulip fully intends to monitor and maintain strong relationships with distribution channel members. C.

Promotional Strategy Tulip communicates with consumers and retailers about its products in a variety of ways. Information about Tulip-?the company as well as its products-?is available via the Internet, direct mailings, and in person. The firms’ promotional efforts also seek to differentiate its products from those of its competitors. The company relies on personal contact with retailers to establish the products in their stores. This contact, whether in-person or by phone, helps convey the Tulip message, demonstrate the products’ unique qualities, and build relationships.

Tulip sales representatives visit each store two or three times a year and offer in-store training on the features of the products for new retailers or for those who want a refresher. As distribution expands, Tulip will adjust to meet greater demand by increasing sales staff to make sure it stores are visited more frequently. Sales promotions and public relations currently sake up the bulk of Tulip’s promotional strategy. Tulip staff works with retailers to marketing methods that require little cash and a lot of creativity also lend themselves perfectly to Tulip.

Because Tulip is a small, flexible organization, the firm can easily implement ideas such as distributing free water and discount coupons at outdoor sporting events. During the next year, the company plans to engage in the following marketing efforts: Attend bicycling events and camel races with our Tulip truck to distribute free water, stickers, and discount coupons for Tulip shirts or caps. Hold a Tulip design contest, selecting a winning slogan and logo to be added to the customized line. D.

Pricing Strategy As discussed earlier in this plan, Tulip products are priced with the competition in mind. The firm is not concerned with setting high prices to signal luxury or prestige, nor is it attempting to achieve the goals of offsetting low prices by selling high quantities of products. Instead value pricing is practiced so that customers feel comfortable purchasing new clothing to replace the old, even if it is Just because they like the new colors. The pricing strategy also makes Tulip products good gifts – for airheads, graduations, or “Just because”.

The customized clothing will sell for ADD 10 to ADD 20 more than the regular Tulip logo clothing. The luggage will be priced competitively, offering a good value against it competition. 9. Budget, Schedule and Monitoring Though its history is short, Tulip has enjoyed a steady increase in sales since its introduction three years ago. Sales have more than doubled every six months from inception (Thomas 2013). The timeline for expansion of outlets and introduction of the two new product lines is as follows: Year 1: New outlets added: 20 Customized items: 5 slogans / 10 logos

Luggage items: O Year 2: New outlets added: 50 Customized items: 10 slogans / 10 logos Luggage items: 2 (duffel and totes) Year 3: New outlets added: 100 Customized items: 5 slogans / 5 logos Luggage items: 1 (backpack) The implementation of each of these tasks will be monitored closely and evaluated for their performance. Tulip anticipates continuing operations into the foreseeable future, with no plans to exit this market. Instead, as discussed throughout this plan, the firm plans to increase its presence in the market. At present, there are no plans to merge with another company.

Executive Summary

Huawei Technologies is the leading Chinese multinational telecommunications equipment and services firm and it has consistently sustained an internationalisation drive – having achieved significant success in its domestic operations. In furtherance of its international expansion project, it sets out to identify new markets where it can do business successfully, expand its customer base, and increase its revenues. The present paper identifies India as a potentially lucrative market for Huawei, and suggests that the company needs to adopt a product and promotions based marketing strategy to exploit the opportunities in the Indian market environment and counter the challenges and threats.

With efficient implementation of the marketing plan and consistent monitoring and evaluation, it is projected that Huawei would gain competitive advantages in market share, product offerings, and sales revenues within three years of entering the market.

Overview

The integration of global economies and opening up of opportunities across borders made possible by globalisation has enabled many companies to explore new markets in international locations in order to expand their business (Alli et al, 2007). Although the motives for internalisation vary from one organisation to the other, many businesses that seek real growth in size, scale, and scope find it necessary to consider expansion into foreign markets at some point in their evolution. While for some firms, the domestic market is inadequate to match the production output or supply, others realise the need to pursue internationalisation to achieve economies of scale and to exploit new opportunities and resources (Hill, 2009).

Indeed, many organisations realise that they need to devise strategies that not only help them retain their customer base, but also to grow and expand their customer base and enhance their competitive advantage in this age of globalisation. Accordingly, foreign market entry and international marketing are central to the strategies that many modern business organisations adopt to remain competitive (Dess et al., 2004; Parker, 1998). This provides the basis for international marketing, which refers to the adoption and implementation of marketing practices across the border, particularly in terms of market identification and targeting, entry mode selection, as well as strategic decisions that helps a company do business and compete in foreign markets (Joshi, 2005). This background provides the context for this report, which attempts to create an international marketing plan for the internationalisation plans of Huawei Technologies, a Chinese technology and ICT solutions company

Objectives for Huawei’s Internationalisation Plan

Huawei Technologies has achieved considerable success in its domestic market in China. However, the company was not satisfied with its domestic success, and this explains why it progressively explored and entered several international markets to expand its customer base and economies of scale (Nakai and Tanaka, 2010). In seeking to enter new international markets, Huawei’s key objectives are consistent with the motivations that drive many companies to internationalise. In this regard, Bartlett and Ghoshal (2005) suggested three main objectives of international expansion: market seeking, securing key supplies, and accessing low cost factors (e.g. cheaper raw materials, labour, etc.). Put differently, Johnson and Turner (2003) suggest that companies internationalise based on the objectives of market seeking, resource seeking, efficiency seeking, or strategic asset seeking.

The objective of market seeking is especially strong in firms that have some kind of intrinsic advantage – in terms of their superior technology, resources, or brand name that may facilitate competitive advantage for them in overseas markets. In Huawei’s case, market seeking is a very strong objective for international expansion, given that the company prides itself as a leading provider of ICT solutions and has achieved brand recognition for advanced technology prowess in the markets where it already operates.

On another level, it is also possible to define Huawei’s foreign market entry objectives in terms of the product cycle theory, which suggests that the process of internationalisation typically begins with an innovation created by a firm in its home country (Vernon, 1996). When such an innovation or product matures fully in the domestic market, the firm begins to explore the possibility to going overseas with it to find new markets (Ibid). Following this theory, Huawei’s international strategy is arguably triggered by a technological advantage that can potentially enhance its competitive advantage by scanning for opportunities and interest in foreign markets in order to establish a global network of operations. Additional objective for Huawei’s foreign market entry plans are to exploit the opportunities of raising the company’s international profile and complement its domestic cost advantages with the differentiation advantages that are required abroad. These objectives are also shared by many growing companies in China that are increasingly exploring opportunities for internationalisation (Child and Rodrigues, 2005).

Assessment of the Market Environment

In order to make a successful entry into new foreign markets, it is often important for companies to undertake a thorough assessment of the market environment in their target markets. Market environment comprises the forces and actors in a given market that are outside the organisation and can affect its ability to initiate and maintain successful business relationships with its target customers (Kotler and Armstrong, 2006).

Market environment usually consists of two different environments: micro environment and macro environment. Micro environment comprises such factors that can have direct effects on the organisation’s strategy, and these include suppliers, customers, distributors, and competitors. On the other hand, macro environment refers to the wider forces in the society that define the characteristics of the market and shape the opportunities and threats the entrant faces (Kotler and Armstrong, 2006; Svensson, 2002). These may include economic, political, cultural, demographic, and technological factors. Accordingly, these factors may likely affect Huawei’s activities in the identified international market, particularly in terms of how the company is able to find customers and establish successful business operations in the market.

Market Identification

India is a potentially lucrative market for Huawei Technologies to target with its internationalisation plan, with particular focus on the Indian telecoms industry segment. There are many factors in the Indian market environment that would affect Huawei in its market entry attempt. For instance, the Indian telecoms and technology market is largely crowded and saturated – thus making the industry very competitive. This means that in order to make headway in this market, Huawei needs to quickly create a distinct identity and establish a strong reputation as a reliable solutions provider and partner.

There is also the problem of negative perception of Chinese companies in India, as a number of Indians perceive Chinese firms not to be sufficiently transparent; Chinese companies also contend with the negative reputation for producing products that are of low quality (Witzel and Goswami, 2012). This means that Huawei would have to contend with the challenge of establishing trust with potential Indian partners and customers, and prove that its products and services are of high quality contrary to prevailing negative perceptions of Chinese companies in India. There are also infrastructural deficits in many part of India, especially the rural areas, which may affect Huawei’s servicing of the Indian market. Many parts of India lack not only key telecom infrastructure, but also basic infrastructures such as power supply and roads (D&B, 2010). It may therefore be challenging for new entrants such as Huawei to operate successfully in such areas.

In spite of the challenges associated with the Indian market environment in general and the telecom market segment in particular, this market is suitable to target because of the considerable opportunities it offers and the resources available. The sheer size of the market and the number of telecommunications carriers in the country offers a potentially huge customer base for Huawei to exploit. The socio-political stability of India is also an advantage, as it would facilitate a conducive business climate for new entrants into the Indian market.

Marketing Objectives

Marketing objectives refer to the measures of accomplishment by which the organisation can measure the degree of success of its marketing strategies. Marketing objectives may therefore include elements such as retention, market leadership, rate of new sales growth, and other indices (Joshi, 2005). In essence, marketing objectives clarify what the organisation wants to accomplish through its marketing activities. In order for marketing objectives to help the organisation achieve the required aims and successfully implement the marketing plan, they need to meet the SMART criteria, which means that they should be specific, measurable, attainable, relevant, and time-bound (Doran, 1981).

Huawei’s marketing objectives in seeking to enter the Indian market can be discussed in terms of the Ansoff Matrix – a conceptual model and marketing planning tool that describes how the organisation links its marketing strategy with its strategic direction. The Ansoff Matrix suggests four distinct growth strategies in marketing planning, namely market penetration, market development, product development, and diversification.

Table 1: Ansoff Matrix

In line with the provisions of the Ansoff Matrix, Huawei’s marketing objectives are mainly based on market development, which involves seeking to achieve growth by selling existing products or services in new markets (Ibid). Accordingly, Huawei’s key marketing objectives are to enlarge its customer base and increase revenues by establishing itself strongly in the Indian market within the first three years of market entry. These objectives are specific because they are straight-forward and clear. They are measurable because the total revenues and incremental number of customers can be quantified to determine how much progress is being made. The objectives are also achievable and realistic because Huawei already has significant experience, proven capability, and superior technologies that allow it settle quickly and make an impact in the new market within the projected time frame. They objectives are also time-bound, given that the projected three-year period for realising the objectives provides sufficient opportunity to set timelines, monitor progress, and adjust the plan where necessary in order to ensure that the objectives are realised within the set period.

Marketing Strategy

In order to determine the most appropriate marketing strategies best combination of the Marketing Mix to adopt for the planned internationalisation project, it is important to note that Huawei Technologies would be entering the Indian market as a ‘latecomer’, as opposed to a pioneer. Pioneers refer to the firms that are first to introduce a product or service in a given market and establish themselves early on. On the other hand, late comers refer to later entrants who enter a market with products or services that are already in existence or provided by existing firms (Kalyanaram and Gurumurthy, 1998). Given that being a pioneer can provide significant market-share advantages over latecomers, later entrants often need to adopt distinctive marketing strategies and positioning in order to compete favourably with the existing firms (Gao et al., 2007).

Based on this reality, the marketing mix (i.e. price, products, promotion, and place) would have to be carefully evaluated to select the most effective combination suitable for Huawei as a latecomer in the Indian market. As such, the combination of product and promotion is suggested as the appropriate combination of the marketing mix that should be used in Huawei’s market entry plan. A product strategy should be central to the marketing strategy, particularly in terms of defining the product range as well as product standardisation in order to ensure the same quality products and services that the Huawei brand is renowned for in the existing markets in which it operates. This should also involve improving product and service quality through incremental innovation in order to compete favourably with existing rival products and services. This product strategy should also be combined with a promotions strategy that involves repackaging product and service offerings through effective advertising and marketing to penetrate the new market. This is best achieved by segmenting the market and focusing on specific target demographics where high impact promotional activities would generate customers seeking varieties or enhanced substitutes to existing products or services (see Matthews, 2002).

Marketing Budget

The marketing budget for Huawei’s planned market entry should be sufficient to ensure the realisation of the marketing plan objectives, while also being cost efficient at the same time. Considering that there are competing marketing initiatives and needs in the proposed plan, allocated funds must be dedicated to each aspect of the marketing effort to ensure that objectives are achieved in a measurable and timely manner (Luke, 2009).

The elements of the marketing budget for Huawei’s market entry as well as the amount allocated to each category are outlined as follows:

ActivityAllocation (US$):

• Advertising and promotional activities (in telecom and ICT industry-focused journals, social media, etc)380,000
• Advertising and promotional materials (e.g. Brochures, fliers, banners, pens, calendars)55,000
• Product Repackaging & Redevelopment550,000
• Research & Development400,000
• Recurring expenses420,000
• Total Budget1,805,000

Monitoring and Evaluation:

Monitoring and evaluation is a critical phase of the marketing plan, since it helps ensure that the plan is being implemented as designed, and meeting the projected objectives. It is also useful in making it possible to adjust or modify sections of the plan in response to observed shortcomings and external unforeseen contingencies (Tourism NT, 2007).

There are a number of approaches that can be used for monitoring and evaluation, but for the present purpose, it is sufficient to adopt the McKinsey 7S Framework to monitor and assess the progress being made by the organisation towards achieving set objectives. The framework comprises strategy, structure, systems, staff, style, skills, and super-ordinate goals (or shared values). It is based on the premise that these seven components must be aligned and mutually reinforce each other in order to help the organisation determine where to realign needs to improve performance, or maintain alignment in order to sustain performance (Peters, 2011; Waterman et al, 1980).

Figure 1: The McKinsey 7S Framework:

Source: Peters (2011)

The McKinsey 7S framework would be useful in monitoring and evaluating the implementation of Huawei’s marketing plan, as each of the seven elements in the framework would be examined to determine where problems may arise along the line, and where further planning may be necessary. In specific terms, the performance of Huawei’s marketing efforts in its international expansion plan would be based on measurable elements such as extent of customer awareness and feedback in response to advertising and promotional efforts, sales response to portfolio of products and services, customer satisfaction with product and service quality, and ROI on marketing investments in relation to quarterly earnings.

Keys to Success:

• Targeted product redevelopment and repackaging to meet the specific needs of high-value ICT and telecom customers
• Focused promotional and marketing activities for maximum exposure to the targeted demographic of potential customers
• Reliable customer service and after sales maintenance support
• Faithful implementation of elements of the marketing plan in line with the time-line
• Critical Issues

The emphasis of product and promotion based marketing strategy is crucial for the success of the marketing plan. Since the telecom and ICT/telecom industry is highly dependent on quality of products and services, it is important to ensure that Huawei maintains its high product/service standard, and make necessary modifications to product formulation and packaging based on the location-specific requirements of the Indian market. Promotion is also vital, as the adopted promotional and marketing activities must be effectively implemented to establish the company’s presence quickly among potential customers. Lastly, the monitoring and evaluation process must ensure that the marketing plan facilitates Huawei’s incremental growth to a position of competitive advantage in terms of superior product offering, market share, and revenues within 3 years of entering the market.

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