Product Support of Mission Statement
Company G is a well-established company in the electronics industry. Its mission statement is as follows: “We enable consumers to improve the quality and convenience of their lives by providing high-quality, innovative electronic solutions.” Company G’s initiative to venture into small appliances production goes in line with its mission statement. The company’s decision to produce consumer electronics and telecommunication equipment gives an insight into success. Some of the consumer goods intended for production include televisions, satellite receivers, video players, video cameras, computer game devices, and radios. On the other hand, telecommunication equipments include personal computers, photocopiers, fax machines, video projectors, and scanners. The production of these electronic products would be achieved through innovation done by existing expertise. Since the company’s engineers used to produce large-scale electronics products, specialization in small electronic appliances would be realizable. The products would be simple that meet the specific needs of consumers. Some of the areas where these products will be used include offices, schools, hospitals, homes, and other social institutions. As a result, the products would be demanded because of their minimal consumption of power.We will write a custom Company G’s Analysis and Marketing Strategies specifically for you
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Small electronic appliances are envisioned in the company’s mission to provide innovative electronic solutions. In addition, the company’s decision to produce small electronic appliances compelled its engineers to undertake design processes and tests. By doing this, they identified weaknesses in the current electronic appliances and opted to eradicate them after the initiation of production. Some of the weaknesses include reduction of power consumption, provision of the desired output, and consistency in supply of products. The innovative electronic products will meet such weaknesses. Thus, it addresses the needs of small electronic appliances in the market. These critical attributes of the company are portrayed in the mission.
The target market for the company’s product
Company G targets small electronic appliances users by providing high quality and innovative electronic solutions. Based on the previous marketing plan for its products, which hindered the achievement of desired profit levels, they target small-scale electronic users. Most of the electronic users are the small-scale compared to the large-scale. As a result, this new niche will be ventured into before other substantial competitors realize it. Consequently, company G will have acquired a larger market share.
The company will assess critical factors that affect the market, such as demographic factors, geographical distributions, lifestyle, and attitudinal characteristics. Company G targets young adults. These individuals are the majority in the market. Similarly, they are ambitious to move with time by obtaining new products in the market. Since the company engages in versatile small electronic appliances, these consumers would demand them to address their needs. The lifestyle of consumers also matters a lot in the targeted market. As a result, the company targets a market where consumers are explorative and value new inventions. Through this process, the consumers would significantly explore the options of the company. The geographical distributions of consumers influence the channels of products’ distributions. Lastly, the attitudinal characteristics of the company’s consumers determine the profitability of the company. In this case, the company targets consumers who have a high degree of preference and taste for new products. Based on its innovative products, it will win the loyalty of consumers. Consequently, this will guarantee the company a better market position and a large market share.
Prior to venturing into the targeted market, the company decided to assess market profitability by designing a feasibility test for the industry. In this regard, company G developed prototypes of small electronic appliances that ensure stakeholders’ interests are served in the market. Through this process, the market objectives are envisioned under the elements of products, price, distribution, and promotion. The specific objectives are highlighted below:
- To produce small electronic appliances for small emerging electronic-user markets at a lower production costs, with quality features that are differentiated from their rivals’ products.
- To distribute electronic appliances through all the available distribution channels in the most effective, convenient and cheaper means to the users.
- To actively campaign for small electronic products’ market leadership through various sales and promotion techniques like media houses, billboards and internet.
- To supply affordable small electronic appliances to consumers as it maximises shareholders’ wealth in the company.
Competitive Situation Analysis
Analysis of Company G’s products using the three-way classification system
Company G can be classified in a three-way consumer product classification system through elements of convenience, specialty, and the shopping of electronic goods (Boone, 2012). This classification system is important for marketing purposes as it indicates specific points where more technical and marketing efforts can be exerted. As a result, the company can identify a basis on which to rate itself against its competitors in the industry. These crucial elements of the system can be analysed as follows:
The marketing team of Company G has to classify electronic appliances based on consumers’ ability to purchase their desired goods. Good examples are radios, iron boxes and automatic hand driers, which motivates a consumer before acquisition. Such appliances can be purchased when an emergency arises, and require no detailed description of their functionality to the customer. It will be important for the company to lower their marketing expenses to attract this segment of consumers. Consequently, a large customer base will be realised, increasing the total demand for the products.Get your
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These are products purchased infrequently, or those which customers take time to make subsequent purchase. Electronic appliances such as home theatre systems require a marketing team to design details of the appliance usage. In this case, the consumers require thorough technical details before making a purchase. As a result, the cost of such appliances tends to be more expensive, and once the purchase has been done, it is difficult for customers to demand a refund in case of defects. However, Company G can cater for such areas by introducing warranty on the specialty products purchased. Consequently, the demand of such products will be high.
These are very expensive products, which are risky when not properly used. Company G can categorise products such as freezers, fridges, and washing machines as shopping products. These products will be distributed with caution, and warranty must be issued to consumers in case of defectives during production.
The best category of products for Company G is convenience goods. These are goods produced by the company with a lot of flexibility. Based on the usage of the small electronic appliances, their demand traits will easily be evaluated by the company. This concept will guide the company in realizing maximum returns from their production. Furthermore, the demand of products will be high because their prices are cheap. On the other hand, the company would not required detailed manuals for usage. This indicates that the production costs will decline significantly. Consequently, the company would easily transcend to the highest market position in the consumers’ mind. In addition, the company would gain the largest market share.
Porter’s Five Forces model of Competitive Forces
Porter’s model provides a framework that illustrates how a company faces external forces to survive in an industry (Mooradian, 2012). The strategic business manager of company G should consider the following aspects to understand the whole industry and develop a competitive edge:
Risk of New Entrants in the Industry
A potential entrant refers to a firm, which is not currently competing in the electronics industry, but poses a threat if given a chance. This implies that the penetration of newcomers increases competition for customers in the electronic appliance industry. Company G can minimise the entry of new players by having a strong capital base. At the same time, operating on low cost of production restricts new entrants. The marketing team of Company G should engage brand loyalty and use effective modes of product promotion in the electronic appliances market.
Suppliers’ Bargaining Power
These concerns companies that supply inputs to the company. Their bargaining power poses a threat to the company by influencing prices of inputs such as raw materials and their services. Based on this fact, suppliers influence the increase in production costs. Through the significant threat posed to the company, the compensation for these costs is passed to consumers. Therefore, these companies are regarded as a threat, and should be handled appropriately. Moreover, the cost managers of Company G should take care of the welfare of its suppliers.
Threat of Substitutes
Availability of substitutes that have the ability to fulfil customers’ needs other than Company G’s products creates a threat to the company. The company must understand the optimum price to charge for their products based on market conditions. It is observed that when the number of substitute products is less, there is a high chance for company G to market its electronic appliances. To avoid dire consequences, company G has to differentiate their electronic products in such a way that customers will regard them as the best choice.We will write a custom
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The buyers’ bargaining power refers to potential effects that the buyers can have on the prices that the company charges for their products. In essence, strong buyers significantly influence the profits of a firm. To survive in the electronics industry, company G should ensure that their products have high quality standards that correlate with their prices.
Degree of Rivalry
Rivalry refers to the competition for customers and inputs between firms. Extreme rivalry among the established firms will influence profitability of Company G. This fact is attributed to factors like demand conditions, growth rates and presence of a large customer base. In this regard, Company G can minimise the effects by engaging in dialogue with other firms to establish a market structure for electronic appliances.
Company G enjoys the following strengths in marketing their electronic appliances:
- The design features of the electronic appliances are very appealing and have an aesthetic appearance. These features will create a change in preference and taste of consumers. Altering these attitudinal traits of consumers would promote a company that has appealing products in the industry. Since Company G has directed its efforts and resources to production of distinctive and innovative products, it would attract a larger proportion of consumers. As a result, the revenue expected from the sales will significantly be high.
- Electronic appliances have been tested for reliability compared to others. Before the appliances are released to the market, a team of engineers is supposed to test them to ensure that they conform to the established standards. This will boost the consumers’ regards about the whole processes of the company. In this case, the consumers’ loyalty would be retained. This will attract more consumers leading to increase volume of sales. Consequently, the company would outcompete its rivals in the industry taking the largest market share.
- Company G’s products cost less when compared to others. Thus, the company can add any profit margin on the costs and still be a cost leader in the small electronic appliances. Through this initiative, the anticipated profits would be high. As a result, the company can engage in diversified investment projects in the same industry to woo more consumers.
- Core competencies are competitive advantages that a company has over its competitor. The following are the core competencies available to Company G.
- Cost leadership- Company G’s electronic appliances are relatively cheaper.
- Product differentiation- The innovative design features of electronic appliances give them a unique position where customers can differentiate them from those of competitors.
Weaknesses that marketing teams in company G have in marketing the small electronic appliances are:
- Uncoordinated product distribution should not be encouraged as it may affect the customers when the products are not delivered on time.
- Poor advertising has the effect of reducing market size and the company may have significantly small market share compared to other electronics manufacturers.
- Undefined and incorrect product labelling may result to incorrect electronic appliance usage. Consequently, customers are likely to go for those appliances having clear and precise product specifications.
Company G has viable opportunities in the small electronic appliances industry. The following are the possible opportunities:
- The production of energy saving bulbs is justified as their returns are significantly higher for small scale users
- Today’s business world requires all people to have a communication gadget. If the company ventures into production of sophisticated cell phones at cheaper prices, it is likely to win over the market in the telecommunication industry.
- Many home theatre systems have been designed for the wealthy people whose needs are more than the needs of poor people.
In any business environment, many firms face threats to their survival. Company G is likely to face the following threats in the electronic industry:
- Dumping of electronic products by giant manufacturers- Some manufactures who dictate the market directions are likely to sell their products at lower prices.
- Raw material shortage- During times of intense electronics production, suppliers may not have adequate materials to supply the manufacturers.
- Fake goods in the market- Fake goods usually have lower prices than genuine goods. They automatically lower the firm’s revenue
The above threats pose a challenge to the survival of a firm in the electronics markets. They can be further described below:Not sure if you can write
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- Goods dumped in the market deny genuine manufacturers revenue from the sale of electronic goods. Therefore, firms may eventually close the business.
- When there is a shortage of raw materials, firms may have idle capacities during times of operations. Persistent shortage may render the electronic business an expensive venture.
- If fakes good floods the market, manufacturers may not realise the true meaning of their existence in business while others will close as fake electronic appliances are bought instead of the genuine ones.
Marketing strategies that can be applied in the market mix by the company ranging from the small-scale to large-scale initiatives depending on the objectives of the firm (Boone, 2012). It can be described as follows.
The product strategic decisions include aspects such as;
- Warranty- A manufacturer should ensure that products are sold with warranties so that in case of any defects, the customer can have it replaced or repaired.
- The appearance of the product is fundamental for the consumer to decide whether to buy or not. A product with compelling features lures customers to buy it.
- Proper product packaging ensures that the product is protected from dirt and that it is guaranteed for external damages.
- The decisions on pricing incorporate desired profit margins and competitors’ reaction towards ones action. Pricing strategies include the following;
- Discounts- When selling a product, it is important to include discounts on them to encourage more customers to make purchases, unlike when such discounts are not available.
- Financing- Financing product purchase should be considered when electronic appliances are significantly costly, thus, the manufacturer has to arrange for the customers’ financing strategies.
- Leasing- When it comes to electronics users who wish to use the products for a short period and then return them, leasing of the products to them may be possible. The manufacturer should be in a position to grant leases to customers.
- This refers to the approaches that are taken by the company to ensure that their products are delivered to consumers. Some of the distribution strategies are;
- The penetration strength in the market
- The selection of appropriate channel of distribution
- Distribution mechanism
- This refers to decisions related to means of informing and influencing potential consumers to purchase the products. Some of the promotion decisions involve the following;
- Advertising- Product advertising should be made through channels that have a wider coverage. Some of these channels include televisions, radio, internet and bill boards. Since the channels are accessible to multiple consumers, the products will continuously cross over their eyes. This will create the need to research, identify, and purchase the products of the company.
- Public relations- A manufacturer of electronic goods should ensure that perceptions created about the products are positive. The marketing team should create this notion. Some of the types of this promotion include customer assistance services, type of language and prioritization of customers. These traits improve the level of hospitality practiced in the company. In addition, the company should participate in social corporate responsibilities. As a result, the image of the company would be improved amongst the consumers.
- Media types-The media house chosen should have a wider coverage. Some of the effective media include mass media and internet. Through placement of the company’s products and its unique features in the media, the number of consumers would increase.
- The best mix to be adopted by Company G involves integration of the four dimensions of marketing. In this regard, the products should be packaged uniquely as well as warranty issued. This will lure consumers to purchase them since they are attractive. In addition, the risks associated with the faultiness of products will have been addressed. Under the pricing concept, Company G has to adopt the discount strategy. This idea will promote the level of sales compared to its absence. Moreover, consumers will always be waiting for their price consideration to purchase products. The place consideration will be catered for by the distribution mechanism. In this case, appropriate channel will be chosen that suits company’s need of accessing consumers. Lastly, the company has to appreciate the need for advertising its products. Through the multiple channels of advertising, the company will always present their products as well as company’s progress. This will aid in creating awareness and reminding consumers of the company’s products in a continuous basis.
Tactics and Action Plan
This refers to the plan that will be adopted by the company in defining the time and reason for any action. In this case, the relationships between various strategies of the company are outlined. This illustrates the vital milestones that have to be covered before the actual mission of the company is realized. Therefore, Company G has to establish an appropriate schedule or time frame that will guarantee the realization of the company’s goals.
Company G’s action plan will take a period of three years with three phases. The first phase will take a period of eight months. Initially, Company G considers averting its production, from large-scale electronic appliances to small scale-scale electronic appliances within the next six months. This will provide a controlled process of clearing the warehouses and replacing them with new products.
The production of small electronic appliances would begin after four months. This process will ensure a substantial collection of products before they can be distributed in the market. After assembling the products for almost two months, the company would engage in the market strategy. This will consist of the launching event of the company’s new products. After this event, the company would undertake a serious campaign on its new products at the market. This would adopt the promotion strategies of the company. Similarly, the company would be investing in its production process heavily to provide its consumers with innovative products. Such a process involves allocation of enormous capital to the research and development department.
The second phase would involve product differentiation and cost leadership in the market. This phase would begin after the eight month to the end of the second year. Product differentiation involves the act of creating products, which are unique and new in the market. Such a process would promote the concept of innovation within Company G. Similarly, the cost leadership would be a critical component of ensuring success in the phase. This comprise of strategies that makes the company an attractive supplier of products due to its prices. The innovativeness of the products combined with cheap prices will push the company to the peak of the industry.
The third phase would concern acquisition of the largest market share. This phase would begin in the third year and lasts indefinitely. One of the strategies to be adopted in this stage is market segmentation. This initiative would be useful in creating different prices depending on consumers’ traits. Some of the crucial steps that can be used to analyze the market include demographic factors, geographical distributions, lifestyles and attitudinal traits. All these steps have a great impact on the profitability of the company. As a result, Company G would dominate the industry gaining a reputation as the leading producer and supplier of small electronic appliances (Mooradian, 2012).
The appropriate monitoring mechanism for company G’s market plan include snapshot assessment, benchmarking technique and investigative studies. At the initial point of the plan, it is essential to undertake a snapshot assessment. This involves the study of the current conditions of the market and other influential factors. Benchmarking technique would then be adopted at the end of each phase. In this case, evaluation will be made based on accomplishments. In the event that the plan does not conform to the objectives of the company, adjustments will be made. The success of the three phases would imply realization of the company’s objectives. After the benchmarks are evaluated, it is essential to analyze the impacts of the market plan through investigative studies. This would facilitate achievement of significant profits. In addition, the company would remain at the peak of the industry.
Boone, L. E. (2012). Contemporary marketing, 2013 update. s.l.: Cengage learning custom p.
Mooradian, T. A., Matzler, K., & Ring, L. J. (2012). Strategic marketing. Boston, MA: Pearson Prentice Hall.