Marketing plan Essay Example for Free

Marketing plan Essay Marketing Plan How to sell Vrd’s Executive Summary: Compact is a company that wants to be well known by marketing a new Voice Recognition Device (VRD). This company will be able to create, develop, and sell the product to many different customers. The product is used and operated by performing tasks without using keyboards, a mouse, or any buttons. Compact wants to serve as many customers as possible. We are flexible and are willing to work with any customer that comes our way. Our target market is essentially everyone. Specifically groups including mangers, assistants, creators, students, home users, and parents are the market segments. All of these customers will be able to take our business to the next level as we sell our products to them. †¢Managers need a product with many special commands and high error protection. The managers need the VRD product to do their work. †¢Assistants defiantly need a product that has a high ease of learning. The product will give them time to multitask with many projects at one time. †¢Creators need a product that is quick and able to get the job done. They don’t really need ease of learning or error protection. These people know how to fix a lot of things. Students want the best product at the cheapest price. The product will allow students to do homework on the go and communicate with teachers. †¢Home users can include everybody from kids to the elderly. For these people this product needs a high ease of learning. In addition, the special commands can be low for the home users because they are just getting started with technology. †¢The parents are caring and buying the product for their kids. They care about the education of their child and want them to be ahead of the game. They just want a product with a high ease of learning for their children. Our company is trying to serve everyone from the broke students to the high end mangers. We feel like our customers/consumers were willing to shop online and at stores. The major retail store will have the product like Wal-Mart and Target. Online shopping will be convenient for the managers, assistants, and creators. Most of these people are very good with computers. To support our decision with choosing this market, we were able to focus heavily on customer service, advertising, and special commands. Also, we felt since we were targeting everyone in the market that error protection, and ease of learning. This will give the ability for our company to sell more and maximize our profit. Our company was able to compete against three other companies selling Voice Recognition Device. And we were able to compete against one other company for the second item DVC. These companies were; Vocley, Voyz, and Echo. The other companies made us take a look at how we can improve our business. The company we competed against for DVC was Echo. We were able to use other companies’ choices to figure out some good business decisions. Also, we used other companies to see what mistakes that we shouldn’t make. To increase our profit we had to change and adjust things to fit the customers. The Compact Company was about profit but at the same time we wanted to sell a great amount of goods. This helped us to determine if our company should change advertising, or customer service, or decrease the price of the product. As the game went on we had to change our market to the higher market in order to make a better profit. This was allowed by watching and understanding the market. The two huge this to make profit was advertising and customer service. The advertising allowed us to promote the product. So with the more promotion we wanted to make sure was had good customer service. This would allow customers to depend on the company anytime they needed us. There were four types of advertising to choose from and they were; Direct, Indirect, Pioneering, and Reminder. For our company we were Direct for the first eight weeks. The dealers were able to target most of their sales face to face with people. But we soon realized that not everyone works like this and wants to buy. Changing to Reminder would inform the customer but give them the chance to come to us. We didn’t want to force their hand into buying something they didn’t want. For Compact this was the best decision we soon upped the profit and price. This had a major effect on the sales of the product for us. We found that the right type of advertising is vital. The distribution intensity is the percentage of time that the dealer is selling your product in each of the channels. You want to have the dealers working but don’t want to over work them. Compact’s dealer intensity was 50% in each channel. The dealers in each channel would have a great amount of time to work and personal time as well. They don’t want to go through a lot of steps to learn how to use the product. Home users are mainly using VRD for online shopping or communicating with other people. This is more of something for them to do while they are laid back. B. Preferences The home users want a good price not as low as students. Also, they want a product that is easy to learn and pick up on. C. Differences from other segments This category could include with a lot people like kids, adults, and elderly. As long as the product is user friendly with the home user anyone is able to use it. They just use the product for fun and games. It is nothing serious like the managers or creators use VRD for. D. Trends We as a group would say the trend of this market is many put into one. A lot more people are using throughout this market so it is offered to many. More people are working and planning on the go so this would be much help to them. Also, the kids doing homework they are forming groups also with the product. Assistants: A. Needs and wants Assistants need something that they can depend on all the time and VRD is that product. While at work they are always asked to do many tasks. VRD is the product that they are able to use with excellent software. Also, has a great ease of learning to pick up on things easier. This device will make the assistant work look better than it really is. B. Preferences The product needs to have to have a high ease of learning. Basically, the ease of learning needs to be on a kid’s level to use. You want the assistants to be able to do their jobs with low amount of stress. C. Differences from other segments The major difference with the assistants is most do not purchase they project. They are mostly purchased by the company that they work for because of the ease of learning. The VRD will be able to keep the assistants on task with their job. And be able to keep their bosses happy with them. D. Trends Once the major and high end companies started purchasing the VRD, they will need less and less assistants. The reason our group thinks this is because the ease of learning will allow less workers, to do more jobs effectively. Creators: A. Needs and wants These are the Market testers, designers, and Writers. This can also include some businessman and professional living. These people want the high speed and want things to want as fast as possible. They don’t worry much about the ease of learning. B. Preferences They just want the speed and high special commands. Price is not really a problem with this group of people. C. Differences from other segments The Creators use the VRD product for professional work. The creators are people who need a product and do not care how much it cost as long as it gets the job done. This group is willing to spend as much money as needed. D. Trends As long as this product works for the creators it will grow. Managers: A. Needs and wants Managers always in charge of other people they need a product that is able to multitask and help others. They need something that is high speed and functions well. Most managers are businessman who has special documents to send out and this product is a huge advantage. B. Preferences These people do not care how much the product is. They just want something that functions very well. Also, this group has the highest special commands at 15. 3. Also, this group wants a lot of error protection too. C. Differences from other segments The managers are people that are very knowledgeable and know a lot about computers and laptops. They do not need any instructions or label how to work VRD. They have been working with them long enough in their field that they will be able to figure it out easily.  D. Trends For this product to stay trending with the managers it will need to have updates all the time. The managers always will want the best product on the market and VRD is it. Parents: A. Needs and wants This group is getting the VRD product for either their kids or grandkids. This will have to have a great ease of learning for the kids. The special com mands don’t have to be high at all. Parents can use this as a teaching tool for their kids. B. Preferences The parents just need a product with a high ease of learning for their kids. C. Differences from other segments Vocley’s strengths seem to be their unit sales, which has led the industry. Other strengths are higher commission percentage for their sale representatives, which give more incentives to create business. Weaknesses can be found in the retail price in distribution channel 1, which is one of the highest of the four companies. With all their success they have maintained a low customer service budget as well as advertising dollars. The data shows that they are trying to promote more business in channel 2 with five more sales representatives than in channel 1. Voyz is targeting the market segments of assistants and managers. It appears that there is a large difference in preferences from the different market segments which makes it hard try and clump a group together. In channel 1 Voyz is carrying the lowest retail price which is good for those that shop in that distribution. Voyz strengths are that they offer low prices in both channels and have great advertising. A weakness would be their budget for sale promotions. Voyz had a big jump from week four to week five, with more than 2. 5 million dollars in sales. This could be caused by an increase in advertising as well as higher commission. In the later weeks they made an emphasis on increasing their sale promotions. Echo led the four companies in special commands as well as overall profit for the first couple of weeks. They are targeting high-end, well to do users that shop in distribution channel 1. Echo is looking to sell to managers, creators, and assistants. Echo has been profiting the most because of the higher prices. Channel 2 is higher than industry average as well, but with good promotional money and advertising they are getting customers to buy into the company. Technologically this product is evolving very quickly and new opportunities are readily available to try and compete with other competitors that are defining the industry. To be on top we need to predict the future of what the customer wants long term, ultimately being the key to success. If better opportunities arise to make our product in another country for less cost and the same technology is available that decision will be made by the head of the company and could put us at a strategic advantage, possibly opening new paths for consumers that didn’t even know about our product. A potentially global market will once again change the game and the product will see a phenomenal rate of growth. To introduce a product to other countries can be an enormous task with major spending but in doing so it will allow for greater profit in the future. Furthermore, producing our product in another country might bring down cost and ultimately lead to more profit. Production can occur in a country where there are low wages and lower cost for parts to make the end product. In addition, another country might have better tax incentives and other government funding to help the production of the VRD to become a more profitable product. Producing the VRD in another country will expand sales internationally as well because there will be more brand awareness in those markets. 2. Marketing Objectives: Compact’s marketing objectives focused on market segments that haven’t been utilized yet and customer satisfaction to retain as many customers as possible. If we can keep our customers happy and attract other consumers from different companies or market places we will gain an advantage. Our marketing type was direct for most of the game but to try and secure those other customers plus retain ours we switched to a reminder strategy. Ultimately, this didn’t turn out as well as we would have liked it to. In fact, in week 10 we had a major decline in profit. To gain an advantage our company needed to focus on high quality customer service and smart advertising to make the customer feel like they’re getting the knowledge and the most innovated type of product, with the company always supporting their product. Our budget for many weeks only allowed for a certain amount of money to be spent which cut into our customer service budget and our advertising. We also had to adjust our research and development since our company could not buy market reports. This was tough to do, but for a couple of weeks we saw a steady growth rate in profits, nothing compared to the leaders though. Our company was still producing profit, but in order to be at the top of our industry we decided on an approach to flood the customers with sales reps and create more advertising hopefully attracting customers that either didn’t know about our product or steal customers from our competitors. 3. Marketing Strategies: 3. 1 Target Market: After playing the game, we encountered different problems with our marketing strategy. Initially our group was doing well and we understood the features of the VRD. After receiving the reports in the first couple of weeks we realized that we had more special commands, ease of learning and the error protection then needed. We got different results from both channels so our strategy was to focus on one channel and put more of an emphasis to sell from that channel. We focused on channel 2 at first, and then gradually brought channel 1 into our strategy since our group was not doing well. Our group had some good competitors and they were doing really well in the business. In order to compete with them we had to change our strategy each week we gave our inputs. We analyzed our competitors and received as much information as we could. With a low budget we were unable to produce reports to determine where we needed to focus our dollars on. This hurt our overall plan because our group had to play a guessing game in order to try and figure out what the customers wanted. Initially we saw that students and the home users were more interested in our products. So we were giving our inputs accordingly. In order to make this an equal amongst all, we had to change some plans so that assistants and managers didn’t fall behind in buying our product. We tried incorporating a strategy to include these types of users and make them aware of our brand, but the other brands already established themselves which led us to have a hard time in the marketing mix. Our main focus was to make sure the customer was getting the special commands, error protection, and ease of learning that they wanted. Throughout the game we adjusted this several times. During one week we adjusted the commands down to better suit the customer’s needs, which we thought would possibly give us an advantage. 3. 2 Product Strategies: As we analyzed the market, we knew exactly what customers needed and what their field of interest was. We knew that we could extend the special commands to 20, ease of learning to 15 and error protection to 15. We could have increased our special commands very quickly but we knew that it’s a long run game and if we had increased our special commands rapidly we will not have any options in the future. We thought our plan was working very smoothly, but, our competitor’s strategy ended up becoming suitable for the market and dominating the industry. We decided to increase our special commands to try an put a product on the market comparable to the one of our competitors. Our biggest competitor ended up being ECHO because they also included the second device in their strategy. Another reason why we were competing with them was because we were the bottom two companies in our industry fighting for those last dollars whereas Vocley and Voyz both secured the top two spots and were fighting for the overall postiton. Initially we were making $800,000 but now we are making 1. 2m. As we changed the strategy and focused on different fields, we were back into business. We cut our cost in most of the things in order to concentrate more on customer support and advertisement. And the results were good enough. we were also spending a lot on our sales agents. We are gradually increasing our special commands, ease of learning and error protection and this was giving us leverage with the other companies but we couldn’t receive as much profit as them which led us to have an overall lower budget. As we said, there were lots of ups and dows in the business and that’s a reality. In real world we have these kinds of issues and its very normal because as time passes, lots of good companies and businesses come into picture and we have to think outside the box in order to compete with them. 3. 3 Promotion Strategies: Product promotion is important to target your segmented market. We strategized to develop the best method to promote our product. We needed to reach our consumers as effectively as possible. We saw different outcomes when we allocated our resources in different areas. Starting in period four we were allowed to determine how much money was going into our promotions. When we had more money to spend we were able to put more money into our promotions for both products. In turn we saw an increase in our units sold. Promotional dollars spent was direct correlated to the units sold, but with less revenue, we had less money to put into our promotion. 3. 3. 1 Customer Service: Customer service is essential to keep your customers happy. Customer service is the level of ease a customer can contact and reach the company. The customer should be able to contact the company in order ask for assistance in the product usage, discuss complaints that they may have, or re-order damaged or under warranty products. Customer service is very important to the customers and the more money that a company can set aside for customer service, the higher the levels of customer satisfaction with the company can be. This was difficult for our team to think how much to put into customer service, at first we spent less money on customer service and were still able to keep our customers satisfied. What our team found strikingly odd was that our customer service could continue to increase, but our customer service, was still not near the industry average. In the first three games we did not think that customer service levels would have the impact that they did on our sales. So we did not put high amounts of money into serving the customer’s needs. Then we realized the more our competitors spent in customer service, the more our customers where unsatisfied with the service levels that they were receiving. Our percentage was steadily decreasing and we needed to increase our percentage in respect to the industry average. On the y axis was the number of units sold and the x-axis the game period. In our findings we found that if you increased the customer service budget, you have happy returning customers. Our strategy was to stay with the industry average after finding the correlation between customer service and units sold. However, it is difficult to stay with the industry average, when sales are decreasing and revenue is dropping. 3. 3. 2 Advertising: Advertising is essential when targeting your market. A company can have the best idea in the world but without customer knowledge the product may never reach the market. Our team understood the importance of advertising our product and initially spent $280,000 in advertising alone. We knew that we had to reach our markets in order to sell our product, this strategy seemed to work very well for us and for the remainder of the game we contributed at the least $200,000 to advertising. In week four we were allowed to choose the type of advertising to market our product more effectively. In week four we went with the reminder, we choose reminder because we had the highest brand recognition out of all four of the competitors. Unfortunately, this did not work out in our favor, as our sales dropped dramatically. In week five we decided to choose pioneering, to show our market that we were the best in the market, if they wanted to quality and the most advanced product in the market. In week five this worked in our favor as our sales increased as well as our revenues. We typically kept with the direct market approach throughout the game except in period 5. We saw that we needed to have large amounts of money in each of the product advertising budgets in order to appeal to our target customers. We spent less money in advertising with product one, and did find that sales impact total units sold. With less and less money to spend in each product segment it was difficult to allocate which product should have the most advertising dollars to spend. In the long run we choose to try to compete with our competitors in the first product market. 3. 3. 3. Personal Selling: Understanding the significance of personal selling in marketing can help a company target their market. Personal selling is the most expensive form of advertisement, but it is the most effective. Selling at the personal level is a more direct approach in contacting your consumer. A person can better target a potential buy. Our team had to choose the appropriate amount of sales people and determine their commission to better influence the sale people to sale to the final consumer. Sales people are an incredibly important part of advertising, a sales person can influence the consumers to purchase the product. However a sales person needs the proper incentive to work their hardest to sell to the consumer. Initially we could only choose the number of sales representatives in each channel. First we equally divided them between the channels and found that the channels had different selling rates so we distrusted the sales representatives from then on. We put higher numbers of sales representatives in the channel that was in need of better sales. Later on in the game we were able to determine the work load of the sales representative and the commission that they could make. Initially, we thought that the higher we make the commission the harder the sales representative would work so in week four we increased the commission to a higher percent. We were also allowed to determine how much time the sales representative was supposed to have customer contact. We thought it was essential for the sales representative to send the most amount of time possible with the customers, without hindering their work performance. So we only made the sales representatives spend small amounts of time doing paper work and clerical duties. Although we were allowed to alter the sales person’s duties and commission so far the push percentage has been steady at of an average rate of . 38. We no longer purchase the reports to determine how well our sales representatives are pushing our products in each channel. Since the beginning we have increased our sales force, although it is the most expensive marketing tool, it is typically the most effective. The chart below shows that we have increased our sales force in each channel; additionally we have continued to raise their commission on the products they are selling. Keeping the number of sales representatives and their commission in mind we thought it would allow for a bigger push in each channel if we steadily increased both. † These methods can attract the consumer to use these products, sometimes it’s the consumers first time using the product and can affect their future purchases. If a customer is satisfied with a sample they can decide how much better the product is than the rest of your competitors and create brand loyalty to your product. We kept the sales promotion amounts pretty constant until period six and did not see an increase in the amount of sales. We did see an increase in our sales in period 7 as we spent almost double are typical spending on promotions but only had an increase of sales of about 5,000 units. Well the product was doing we were then able to order the appropriate amount of manufactured product for the next week. During the game we were able to keep manufacturing at similar levels as our sales were not increasing drastically. We did increase our production when our sales were increasing. 3. 5. Pricing Strategies: Consumers have always been very sensitive with price, and will be. Products that are priced incredibly high are sometimes seen as high quality or part of the social elite market. On the other hand products that are priced lower can been seen as high value or affordable. Price is one of the essential variables to reach your target market. Our team was able to understand our distribution channels and was able to determine that the people that tend to purchase our product in channel 2 were more price sensitive than those in channel 1. It didn’t occur to us that we should change the prices in the different channels until week four. After changing the prices in each channel we were able to target the different markets in each channel more effectively. Throughout the game we allocated our money different according to the resources that we had and what we needed to improve upon. Most of our money was allocated to our sales force in the first product segment. Combined from both product sectors and adding their salary and commission they were almost 75% of our total expenses. This does show that person to person selling is the most costly. Our next largest expense was advertising as we spent about 1/3 of our funds to advertise our product. The rest were very small amounts of our expenses throughout the game, we decided to spend less money in these areas as they had a smaller impact on our unit sales. Controls For the controls we wanted to see what worked best within our plan. We wanted to take a look at the controls every week and be able to monitor it. This would depend on want the customers’ wants and needs were. We knew and understood that we were here to serve them. Within the first three weeks we were able to reach our goal to serve the customers. We focused on ease of learning and special commands. We also were able to level off at error protection on the fourth week. But this was not enough as the weeks progressed we were always able to add more. During the fourth week we were able to purchase two more of each. That was ease of learning and special commands. The main reason that we raised those was because we seen other groups doing it to better serve their customers. We wanted to serve them as best as we could. Toward the end with extra money coming in we were able to increase all of them by two during the seventh week. Throughout the weeks we had to decide whether or not to buy the reports. We bought the reports in a later week to see if our preferences were in line with our target market. We made adjustments to our strategy and preferences so that we could meet the needs of our target market. Our objective for the remaining weeks was to make sure that overall we still had a profit and we were not losing money. This was attained and our objective was completed. In a real environment though, the company would have to consider strategic moves in order to stay competitive and survive in the long run. Our product was on a path towards the decline stage, if not already there. In the end, we still completed the game with a profit and had a product that certain groups of consumers relied upon.