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ABERDEEN BUSINESS SCHOOL BSM505: Marketing Coursework 2 SUBMITTED BY: Syed Muhammad Asim (1214852) Tutor: Simone Kurtzke Msc International Business 19 December 2013 Word Count: 2740
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Marketing Coursework 2
Contents
Executive Summary ................................................................................... 2 1.0 Assumptions ........................................................................................ 5 2.0 Marketing Objectives and Strategies ....................................................... 8 2.1 Marketing Objectives .......................................................................... 8 2.2 Marketing Strategies .......................................................................... 8 3.0 Expected results, Alternative plan and extended marketing mix ............... 13 3.1 Expected results .............................................................................. 13 3.2 Alternative plan ............................................................................... 14 3.3 Extended marketing mix ................................................................... 15 4.0 Budget .............................................................................................. 18 4.1 Gathering of funds from philanthropic individuals and local community ... 18 4.2 Budget for media and product development ........................................ 20 5.0 Implementation Programme ................................................................ 22 5.1 Milestone ........................................................................................ 22 5.2 Tactical plan .................................................................................... 23 5.3 Marketing control............................................................................. 24 6.0 References ........................................................................................ 26
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List of Table & Figures Figures
1
Content
Page
6
Tables
Content Showing the Assumptions Assumptions Showing the Marketing mix 4P's Showing the Marketing mix 4p's Showing the Strategy Map Showing expected results Showing Alternative Plan Showing extended Marketing mix Showing the Budget Milestone Showing Strategies and Sub objectives Showing pricing and sales plan Marketing Controls
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1 2 3 4 5 6 7 8 9 10 11 12 13
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Table 1: Showing the assumptions It can be assumed such extra spending to support Ryder cup golf tournament should definitely bring about 10% more people visiting Aberdeen in 2014. As this event is targeting not only local people but is also being broadcasted globally (Gleneagle2014, 2013). The Baker Hughes 10K running Festival, organized by Sport Aberdeen is the largest 10K road race in the North East of Scotland and also includes:10K Race, 10K wheelchair race, Schools 2k Race, Family Fun Run (Sport Aberdeen, 2013). It can be assumed such event should at least bring in 20% more people currently living in Aberdeen to spend a day at Aberdeen beach area and would reflect in at least 10% increase in sales at Queen's link by 2014 Generated by student Figure 1: Showing the Price and Value composition of various destinations
Source: Collier (2011) An opportunity discovered in marketing phase 2, regarding Aberdeen Beach nourishment and upgrading of coastal defenses in order to eliminate problems such as coastal erosion. (University of Aberdeen, n.d.)
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Table 2: Assumptions It can be assumed by making Aberdeen beach area more secure by upgrading coastal defenses and getting rid of coastal erosion problems, once this issue is solved, more entrepreneurs should be willing to invest in Aberdeen beach area and provide more product offerings to the people, the current issue of people not getting enough value for price from Aberdeen beach area should be solved and by more offerings, Aberdeen could also be a destination with higher value for price and secure at least 10% increase in market growth by second quarter of 2014 as a result.
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As identified earlier the objectives to be achieved are mostly pertaining to products and markets, and hence price, product, promotion and place are to be examined in this particular case. Further more in order to efficiently determine strategy to achieve objectives Ansoff matrix could be used which is a useful tool for developing strategies. (Strategic information design, 2013) After analyzing the Ansoff matrix, product development and market penetration are two strategies most applicable for this particular marketing plan, as market is same only product is either new or existing for offering to the target market as identified in course work 1. In order to achieve objectives such as 10% increase in sales, 5% increase in market share and 50% excellent visitor rating and 10% increase in Aberdeen beach popularity " Market penetration strategy" could be used, this is basically pertaining to business focusing on activities on increasing its market share by exploiting its present product range in its existing market. (Cole, 1997) In order to successfully utilize market penetration strategy various marketing tactics could be used, but in this particular market plan, driving out competitors through increasing sales, increasing market share and achieving 50% excellent visitor rating would be used. Marketing mix for the objectives to be achieved through market penetration strategy.
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Table 3: Showing the marketing Mix 4p's Product Price Nothing new would be added to the current offerings at Queen's link area The pricing of overall products and services offered by Aberdeen city council and Queen's link area has to be reduced by 10%, in order to encourage more sales, and to attract more customers Various promotional campaigns will be started, on social media and various other campaign such as "Go Green" can be launched, people can volunteer to plant trees on beach soil making it more environment friendly place and attracting more people to visit Aberdeen beach. Also the various companies operating at Queen's link would be request to come up with loyalty scheme, giving 10% discounts on product for instance just to make visitor a loyal customer. Creating more awareness of Aberdeen beach and Queen's link area by advertising on magazines, newspaper and television. Place Place is same, only that it could be made more cleaned and make it more appealing to customers by having street lights to be planted at beach area where people go for jogging at night time, it's too dark for anyone to even think of going near beach at night. Source: Generated by student. As it can be seen in Table 3, that to achieve market penetration strategy in order for accomplishment of objectives it is crucial to reduce price of products and service being offered along with advertising on both social media by creating a face book page and having traditional promotional campaign such as "Go Green" by asking people to volunteer and be part of such noble cause and make the beach environment friendly area along with introducing new loyalty schemes. The remaining objectives which are, launching at least one new product and service and 20% increase in visitors to Aberdeen beach should be achieved with the strategy of product development, meaning introducing new products to the existing market and thus focusing on developing, launching and supporting additions to the product range. (Cole, 1997)
Promotion
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Marketing mix for the objectives to be achieved through product development strategy Table 4: Showing the marketing mix 4p's Product Adding more variety of rides, in order to target the segments identified in course work 1 such as adult's require more thrill rides, which is lacking at breach leisure park at Queen's link, addition of such rides would develop the interest in visitors mind to visit leisure beach park for something new and sensation. A new service will be in form of two guards to be recruited by Aberdeen city council for the Aberdeen beach area, where by the guards would always be there at beach even at night time ensuring the safety of everyone, also if there was any parents before which were hesitant in sending out their children to open beach due to lack of security, would now feel comfortable in allowing them to visit beach. Also a new beach bar could be opening at Queen's Link area, but this having two guards covering Aberdeen beach and making sure no one who is drunk is permitted to enter the beach would result in less casualties and also the night life at Aberdeen beach area would uplifted due to this. Price The pricing for new rides and beach bar, has to be moderate, with minimum profit margin for the first year at least, as core objectives is to bring about 20% increase in visitors to Aberdeen beach and definitely lower price on new offering's would attract more and more people. Promotion Promotion has to be done on huge scale, in order to create awareness of new offering's, as it is always interesting to read about new things and finding out about how they really are and so advertising will be done with usage of both online and traditional ways. Place The place would remain same, Aberdeen beach and Queen's link area. Source: Generated by student. As we can see in table 4, in order to achieve product development strategy to accomplish the mentioned objectives it is crucial to develop new product such as variety of rides to be built and launched in beach leisure park along with new services to be provided such as a bar and life guards for 24/7 support making Aberdeen beach a much safer place to be at any given time, whereas pricing needs to be below the competitors, in order to attract more and more visitor.
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Table 5: Showing the Strategy Map Marketing Objectives 10% Increase in Sales 5% increase in Market share 50% 1 new product excellent and service visitor and 20% rating increase in visitors 10% Increase in popularity
Ansoff Matrix
Marketing Mix
Source: Generated by student Table 5, here shows the strategy map, in order to achieve marketing objectives, the approach has to start from very bottom as identified marketing mix shows, then those marketing mix P's can be utilized by using market penetration and product development strategies through Ansoff matrix.
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3.0 Expected results, Alternative plan and extended marketing mix
This section will cover forecasts of what will be achieved through the marketing strategies. It is essential that to have in place a plan B just in case the main strategy does not prove as rewarding as expected along with the extended mix (Small Business, 2007).
Marketing Strategies
Market penetration, reducing price by 10%.
Expected Results
It can be expected that, a reduction in price by 10%, would attract more visitors to Aberdeen beach area, resulting in market share being increased by 5% as more products will be sold. It can be expected, that an increase of 5% in market share would bring about more sales and profits would increase by 10% for Queen's link. The higher the customer satisfaction, the more customers would become loyal, more repeat purchases, leading to a 10% increase in profit and 7% increase in market share. It is expected, the cost of operating such large scale advertisement would increase by 20%. Such new product and service offering would result in 50% increase in cost.
Reduction in price, more advertising and providing more public goods such as street lights at beach area where people jog for night vision. Various campaigns such as "Go Green", Loyalty scheme 10% reduction in price for next purchase.
At least 1 new product and service and 20% Increase in visitors number to Aberdeen beach.
Advertising on magazines, newspaper, television, Various campaigns such as "Go Green" Addition of thrill rides to Aberdeen beach leisure park. Providing 2 security guards. Opening up new bar.
Source: Generated by student Overall, it can be said, that accomplishment of objectives through given strategies would result in a sharp overall profit increase by 20%, where as
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market share is expected to grow by 12% along with cost incurred accounting for 70% of the total budget allocated for promoting tourism and developing new product and services at Aberdeen beach area. Apart from recruitment cost of Staff.
10% Increase in Popularity of Aberdeen beach area At least 1 new product and service and a 20% increase in visitors number to Aberdeen beach
Source: Generated by student In this particular plan B, as stated in table 7, objectives won't be changed, only the strategies will be adjusted in changing the marketing mix for accomplishment of marketing objectives.
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in order to a achieve a 10% increase in sales, price of goods offering at Queen's link are to be reduced by 15% now, encouraging more and more people to visit Aberdeen beach and purchase products at Queen's link resulting in more sales, which also leads to increase in market share, but solely to increase market share by 5%, also promotion would be changed, this time advertising on all the possible available media, in order to create more awareness about the beach but also to persuade the visitors to Aberdeen beach, by publishing availability of hall room weekly in newspapers, magazines and even on face book page which will be created, this also leads to the accomplishment of the 10% increase in popularity of Aberdeen beach, as mass media advertising should result in more awareness of Aberdeen beach area offerings. In order to achieve 20% increase in visitors and providing at least 1 new product and service, strategy would be completely changed resulting in encouraging investors to invest in Aberdeen beach area, as there is availability of land, by countering the coastal erosion issue which might have hold back investors would only lead to positive outcome of investors investing, and for instance if a new affordable hotel is created near beach area, it will successfully attract more visitors as people who don't have a personal property to live in Aberdeen, would be glad to accommodate themselves in this new hotel provided it is affordable then others in general and service level is greater than others.
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Table 8: Showing the extended marketing mix Product Addition of new thrill rides at Aberdeen beach leisure park at Queen's link, and also after successfully attracting investors a launch of new affordable hotel near Aberdeen beach. Reduction in price by 10% for existing goods and services offering at Queen's link, also the new products and services which will be launched, need to be priced competitively, being below the competitor prices would result in more visitors coming to Aberdeen beach area. Addition of more public goods such as street light for night vision covering the place where people usually go out for jogging. keeping the place clean and tidy for better customer experience. Large scale advertising to be done, using both traditional ways of advertising such as magazines, newspaper and television, along with e-marketing by advertising on social media creating face book page. Encouraging the employees at Queen's link to be more customer oriented in delivering service, by adhering to the concepts of customer relationship marketing. Also encouraging employers to develop "team spirit" to ensure smooth running of business and service delivery. Improving the transportation facility provided to access the Aberdeen beach offerings, by holding a meeting with bus transportation companies encouraging to make a route which would lead visitors easily to beach. Making policies of attaining license much easier to do business at Aberdeen beach area, encouraging international brands to open up various restaurants at Queen's link to further enhance the image of Aberdeen beach. As physical evidence would refer to all the offering's at Aberdeen beach area.
Price
Place
Promotion
People
Process
Physical evidence
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It can be deduced from table 8, that in order to accomplish the marketing objectives and expected results, it is crucial for the addition of three marketing mix people, process and physical evidence to the earlier discussed four elements price, product, promotion and place. People Anyone who comes into contact with customers will make an impression, and that can have a profound effect, positive or negative on customer satisfaction. the reputation of Queen's link would therefore rest in the employees which work there, and should appropriately be trained, well motivated and have the right attitude to serve customers with a team spirit (CIM, 2009). Also customer relationship marketing should be implemented at Queen's link, according to Peelen (2005) CRM is to be regarded as a business strategy that is aimed towards developing long-term, mutually profitable, individual customersupplier relationships and is placed on an IT infrastructure to be developed, one that enables well-defined and controlled processes, and places capable personnel in a position to function optimally. If customer relationship marketing practices could be implemented at Queen's link, excellent visitor rating of 50% should be easily achieved, leading to loyal customers, repeat purchases an overall increase in sales and profit generation for companies present at Aberdeen beach area. Process The process of giving a service, and the behavior of those who deliver are crucial to customer satisfaction. Issues such as waiting times, the information given to customers and the helpfulness of staff are all vital to keep customer's happy. (CIM, 2009). Aberdeen city council would need to call for a meeting with bus service providers in Aberdeen, to request a development of route to make it convenient for visitors to travel to Aberdeen beach area, this would encourage visitors to visit Aberdeen beach often as not all the visitors who visit to Aberdeen beach area would be using car as transportation medium, also again customer relationship management would assist in staff being helpful to customer as there will not be Robert Gordon University Page 17
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any communication gap within the companies, and hence information provided would be concrete and valid. Physical Evidence Physical Evidence is the element of the service mix which allows the consumer to make judgments on the organization products and service. the physical evidence of the marketing mix refers to the tangible expression of a product and how it is purchased and used by the customer. (Thelma, 2009) Hence if Aberdeen city council is able to persuade more internationally recognized brands such as " Hardees" the fast food chain to open up a subsidiary at Aberdeen beach would enhance the offerings and also provide customers to choose from variety of fast food options, and it will be something new at Aberdeen beach, which Black Pool beach won't have and this in turn should attract more and more visitors to come to Aberdeen beach area and experience the new fast food availability, this also would lead to accomplishment of the objective providing new product and services to Aberdeen beach and 20% increase in visitors number to Aberdeen beach area.
4.0 Budget
According to Samuels (2013), Many small businesses make the mistake of limiting their marketing budget to marketing communications costs such as advertising, public relations, direct mail and promotions. A true marketing plan includes the upfront planning, communications expenditures and ongoing monitoring and tracking marketing efforts. Hence in the budget for marketing plan, the major components which will be analyzed will be Media, Hiring of individuals and any support which could be gathered from philanthropic individuals and local community.
Marketing Coursework 2
will regenerate the area around Aberdeen beach and offer more product and services to visitors along with making their experience even more interesting with a reduction in price by 15% in order to make this plan a success how crucial their support is and will make it easier for carrying out plan smoothly.
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4.2 Budget for media and product development
In this budget area various expectation of expenses will be incurred to carry out promotional activities and product development cost will be presented. Table 9: Showing the budget for Media and product development Category Promotions Loyalty scheme Advertising Magazines Estimated quantity 1200 10,000 Estimated cost per unit 5 6.49 (Scotlandmag, 2013) 2584 (UK business forum, 2008) 0 0.63 (Social ads tool, 2012) 20 (DM Digital TV, 2012) 200,000 (Amusement trader, 2013) 100,000 (Guthrie, 2013) 50,000 35,000 (Kelly, 2013) Estimated subtotal 6000 64900
Newspaper
2584
Face book page Advertising on Face book (Pay for clicks) Television Product Thrill ride (Super shot) Bar People/Service 2 life guards on 12 hour shift Promotional campaign manger Total cost
0 12600
10,000 1
20,000 200,000
100,000
2 1
50,000 35,000
491,084 (Approximately)
Source: Generated by student As it can be seen in table 9, the expected budget for media and product development would approximately cost around 500,000 pounds, which is Robert Gordon University Page 20
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expected to be raised through philanthropic individuals and local community donations. This budget is for one year, where by every category of budget and subcategory has been planned to cover the whole year, for example, 10,000 magazines will be distributed throughout the year, in order to create awareness about the offerings of Aberdeen beach area. Furthermore a promotional campaign manager must be recruited by Aberdeen city council, who will be in charge of making sure this marketing plan is implemented in order to achieve desired results, costing 35,000 pounds annual salary. Advertising on face book, and the expected clicks on the link should be 20,000 in order to achieve the objective of increasing visitors number to Aberdeen beach.
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5.0 Implementation Programme
The marketing plan is mostly about implementation, changing the business, making it better. It is worth nothing if not implemented, this section covers specific implementation programs, and the details that it takes to make it happen (Palo Alto, 2004). However it is crucial for the successful implementation of this plan for Aberdeen city council to have support from stakeholders as the mutual understanding is highly significant in this particular marketing plan. The following tables identify the key marketing programs, stating which department is required to carry out what duty, dates and budgets are clearly established.
5.1 Milestone
Table 10: Milestones Milestones First quarter (JanMarch) Second quarter (April to June) Third quarter (July to Septembe r) Fourth quarter (October to Decembe r) Budget Departmen t
Promotion Advertising New product developmen t Recruitment Source: Generated by the student
85,000
HR
Table 10, basically states the milestones which needs to be achieved for the accomplishment of overall objectives and success of marketing plan. However, the time frame and actual results will be evaluated against planned, and interferences and revision of any activity is possible.
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5.2 Tactical plan
In this section, general strategies will be further divided into sub objectives. Table 11: Showing strategies and sub objectives Strategy Plan A- Reduction in price by 10% Plan B- Reduction in price by 15% Achieving 10% rise in sales Source: Generated by student Table 11, shows that the major strategies which are crucial for the accomplishment of objective and be dealt by having a specific sub objective, in order to achieve strategy pertaining to reduction in price a pricing plan could be implemented, for various advertising methods, advertising plan, and for achieving a rise in sales a sales plan. Table 12: Showing pricing and sales plan. Pricing plan Sales plan Sales plan Sub objective Pricing plan
In order to achieve a reduction in price, penetration pricing strategy should be used, Penetration pricing is used when a company wants to really dominate a market. Queen's link offerings will have to lower almost all of their prices in order to keep customers buying.
Advertising approach: Social media, TV, Newspaper, Magazines, various campaigns. Expanding presence by opening up a page on face book. Loyalty schemes, to gain more loyal customers. Customer relationship management, to satisfy customer and persuade for repeat purchases. pricing structure: reduction in price, to earn more profits on volume. Implementation of Customer relationship management
Source: Generated by student. Pricing plan and sales plan as mentioned in table 12, successful implementation of these plan would result in accomplishment of objectives and expected results.
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Profitability control
Efficiency control
Strategic control
Line and staff management along with marketing controller (Campaign manager) Top management and Marketing auditor
Sales force Advertising Sales promotion Distribution Marketing audit marketing excellent review Marketing effectiveness rating
To examine whether the company is pursuing its best opportunities with respect to markets and products
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According to Kotler (2003), Implementation without control measures in place is bound to fail and it is control measures as mentioned in table 13, which will restrict the failure of implementation plan occurring in the first place. Overall it can be said, it's a top to bottom approach , where by Top level management at Aberdeen city council should be responsible for communicating the objectives and strategies throughout the organization so everyone is involved in carrying out this marketing plan to best of their ability. As it can be found under table 13, it clearly states who is responsible for what, and Aberdeen city council must implement suggested marketing control to leech desired results from implementation programme. Stakeholders consensus must be on board for the accomplishment of objectives. Lastly it can be concluded by saying the cost incurred to carry out this market plan is supported highly by the return it will bring to Aberdeen beach area, more visitors, more revenue and profits along with higher market share and globally recognition.
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Mars. 2012. Implementation and control: Kotler on marketing [online]. Available from: < http://www.marsdd.com/articles/implementation-and-control-kotler-onmarketing/> 18 December 2013 McDonald, Malcolm;Wilson, Hugh. 2011., Marketing Plans. [online]. Wiley. Available from:<http://www.myilibrary.com?ID=337173> 15 December 2013 Paloalto. 2004. Acme Consulting- Sample Plan [online]. Available from: < http://www.paloalto.com/sampleplans/MPP6/enu/Live/acmeconsultingmpp_Live.pdf> 18 December 2013 Phillip Kotler. 2003. Marketing Insights from A to Z: 80 Concepts Every Manager Needs to Know. NYSE:JWA. John Wiley & Sons Robert Collier. 2011. Visit Aberdeen realizing the potential [online]. Available from: <http://committees.aberdeencity.gov.uk/mgConvert2PDF.aspx?ID=15678> 15 December 2013 Scotland Magazine. 2013. Subscription [online]. Available from: < http://scotlandmag.subscribeonline.co.uk/Back-Issues/back-issues-2013> 17 December 2013 Strategic Information Design. 2013. The Ansoff Matrix [online]. Available from: < http://strategicinfodesign.com/documents/lecture-slides/selling-holes/8-theansoff-matrix/> 17 December 2013 Small Business. 2007. Marketing Manual- Marketing Plan Guide [online]. Available from: < http://www.smallbusiness-marketing-plans.com/marketingplan-guide.html> 16 December 2013 Social Ads Tool. 2013. FACEBOOK ADS GUIDE [online]. Available from: <http://www.socialadstool.com/facebook-ads-guide/facebook-ads-cost/> 17 December 2013 Susan Ward. 2013. 4 Steps to Developing a Marketing Plan [online]. Available from: < http://sbinfocanada.about.com/cs/marketing/a/marketingplan.htm> 13 December 2013 Robert Gordon University Page 27
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The Economic Times. 2013. Definition of 'Marketing Mix' [online]. Available from: < http://economictimes.indiatimes.com/definition/marketing-mix> 17 December 2013 Thelma. 2009. (the 7p's) physical evidence [online]. Available from: <http://thelmaegbe.blogspot.co.uk/2009/11/7psphysical-evidence.html> 11 December 2013 Trip Advisor. City Beach [online]. Available from: < http://www.tripadvisor.co.uk/Attraction_Review-g186487-d211607-ReviewsCity_Beach-Aberdeen_Aberdeenshire_Scotland.html> 15 December 2013 UK Business Forums. 2008. Advertising in local newspapers cost [online]. Available from: < http://www.ukbusinessforums.co.uk/threads/advertising-inlocal-newspapers-costs.80629/> 17 December 2013
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