Marketing Assignment: Developing A Product Marketing Plan For Wesfarmers Limited
Prepare a marketing plan (2,500 words) to introduce a new product in the marketplace.
Marketing Assignment Instructions:
For this assignment, you will prepare a marketing plan for the organisation you selected for your first assignment. The purpose of the marketing plan is to outline how you would market an entirely new product or a variation to an existing one.
For your marketing plan, you should include the following elements:
1. Business Vision and Mission
a. Identify the company’s mission. You may get this information from their website, interviews with business leaders, publications and reports, or potentially through personal conversations with business leaders or owners.
2. Marketing Audit
a. Construct an Ansoff Matrix for your organisation. This is also known as the Product/Market Expansion Grid.
b. Explain each of the four-quadrant of the matrix including:
i. Market penetration – Focus on how you would expand sales for your existing product in your existing market.
ii. Product development – Introducing a new product into your existing market.
iii. Market development – Develop an existing product into an entirely new market by finding a new use for the product or add new features or benefits to it.
iv. Diversification – Introduce a new, unproven product into an entirely new market.
c. Explain what strategy you plan to use and why you have selected it.
3. Marketing Objectives
a. Create two or three marketing objectives. Your objectives should help your company move towards their vision and mission and address your findings from the Ansoff Matrix.
4. Target Market
a. Describe two or three potential customer segments you will want to target for your new product offering. You should ensure your segments will help you achieve your goals.
b. You may consider the following:
i. Demographic – personal attributes like age, marital status, gender, ethnicity, sexuality, education, or occupation.
ii. Geographic – country, region, city, neighbourhoods
iii. Psychographic – personality, risk aversion, values, or lifestyles
iv. Behavioural variables – how people use the product, how loyal they are, or the benefits they are looking for.
5. Marketing Mix
a. Pricing Strategy – Outline what pricing strategy you will use to price your new product offering.
b. Channel Strategy – Outline what distribution channel(s) you will use to sell your new product offering.
c. Promotion – Outline how you plan to promote your new product offering. You should include what mediums you will use including advertising, public relations, direct marketing, sales promotions, etc.
Business vision and mission
Wesfarmers Limited, selected to prepare this report on marketing assignment, is an Australian conglomerate company based on headquarter in Perth, in Western Australia. The company operates in various industries such as retail, chemicals, industrial, and fertilizers, etc. predominantly in the areas of Australia and New Zealand. The overall revenue of Wesfarmers was about $30.8 billion in the year 2020. Wesfarmers is counted as one of the highest revenue earning companies in Australia. In addition to that the company comes under the largest private employers company in Australia (George, 2020). The overall numbers of employees are more than 107,000 within Australia. The vision of Wesfarmers is to perform a strategic plan for its future. The vision statements of the company state that the company's future strategy on what and where they will be standing in the future. Including its vision document signifies the aims of the Wesfarmers limited to accelerate strategic, general decision along with the managerial process. The quality and differentiation of their products after a strategic plan make them unique and have helped them to stand ahead in the competition. The company doesn’t believe just in enlarging the business in return for their customer’s love and value towards their brand.
On the other, the mission of Wesfarmers is to provide quality returns to its shareholders from several areas such as financial discipline, extraordinary management, of a varied portfolio of its business (Annual report, 2019). Their mission statements support every department of its organization to have a very effective management capability that helps the company to develop and implement its strategy in its everyday business operations. The board of directors whereto comes CEO, managing director, CFO regulates and monitors the function of every department of Wesfarmers. The management is allowed to work on a Group-wide processing cycle and the governance framework. Although the company is doing excellent in its existing market, it will be additional support if they focus more on healthier products in their retail industries. To do so, a product has been developed, "Health Bake," a healthy product that will help the brand to strengthen its market value since the trend of eating healthy products has been increased after the global pandemic. Marketing audit
a. Ansoff Matrix
Figure: Ansoff Matrix
Source: (Hanlon, 2020)
Ansoff Matrix: The Ansoff Matrix acts as a tool that has been highly used by the company to plan and strategize their product or service growth in the market. The Matrix consists of four-quadrant which is required for the organization, and it also identifies the risk factor associated with the strategy. The four quadrants are discussed below for the Wesfarmers Company to make strategies for the suggested new product, “Healthy Bake”.
Market Penetration: Since Wesfarmers is already an existing company in Australia that also operates in New Zealand with a huge customer base. The company has been able to connect with its customer emotionally for decades. However, because of high competition in the market, it will be great if the company comes with a full-fledged plan in the market in terms of launching new products. For market penetration, Wesfarmers can follow a few steps to increase the number of sales in terms of existing products (Hendron, 2021). The company can address the exact needs of the customer along with that Wesfarmers can update its offerings strategies for the existing products in its retail industry. Wesfarmers can create a loyalty program to develop value for their customers.
Product Development: The new product that will be introduced in the market will be Healthy Bake, which is a healthy bakery product. The product development by Wesfarmers has been done considering the current trends of eating healthy diet post-pandemic. Bakery products cannot be avoided by children and even by adults. But with the awareness of a healthy lifestyle after the global pandemic, the craze of having such food items is diminishing slowly in the market. Thus the production of the healthy bakery by Companies like Wesfarmers will be a great relief for bakery lovers (Zhao, 2018). The new product, Healthy Bake, will be developed by using less sugar amount than the regular one, and the utilization of artificial color, sweetness, calories, etc., will be fully avoided in this product. Thus, the new product, Healthy Bake, will be ingredients full of fiber that will be the USP of the latest products. Including it, the other ingredients for their new bakery product will be whole wheat flour, seeds from sunflower, oats, and just a pinch of honey.
Market Development: Market development for Wesfarmers will not be that hard since it has already established its base for decades. However, the company can explore several other geographical locations to introduce its product. After the global pandemic, the lifestyle of living has been drastically changed in almost every country in the world. Wesfarmers coming with the unique idea of launching a healthy bakery will strengthen the development of the market in a new location.
Diversification: For diversification strategy, the development of a new product Healthy Bake, will be relevant in the current situation of the country (Rick De Vlieger, 2019). Diversification is a strategy that can be applied when companies wish to enhance their growth. The practice of using a diversification strategy will allow Wesfarmers to introduce a new product in its management of the supply chain. In this strategy, the new product Healthy Bake will not take much time to gain fame in the market because it has been developed considering the fact of the new changed lifestyle of the customers. The product that Wesfarmers will launch in the market considers the customer who is conscious of eating and living a healthy lifestyle.
b. The strategy that has been planned to launch the new product Health bake by Wesfarmers will be the Diversification strategy. The diversification strategy will be appropriate for Wesfarmers since it allows the company to introduce new products in their existing market. Also, a diversification strategy will not take much time, and it is cost-effective in comparison to the other approach (KEPKA, 2021). In this strategy, the company will only be producing new products and can introduce them in their supply chain management; however, advertising will be required, but because Wesfarmers being already existed as a renowned brand in the market will not need too much promotion in the market. Thus the idea of using a Diversification strategy will be appropriate for Wesfarmers in launching Healthy Bake.
Furthermore, Diversification will be of different kinds, among which horizontal Diversification will be appropriate for the company Wesfarmers (McIlvaine, 2021). This strategy will ensure the company establishes a process for the new products. Also, the risk factors that can be encountered during the implementation of the company's plan, diversification strategy will keep them aware of the possibilities of the risk. While introducing Healthy Bake by Wesfarmers, there will be new market segmentation in the existing market; this strategy will support the company to achieve the target (Chirani & Effatdoost, 2013). The new product is completely new for the customers of Wesfarmers; thus, this strategy supports the company to create value with Healthy Bake. Hence, considering all the above-mentioned advantages, the horizontal approach under Diversification has been selected for the marketing strategy of Wesfarmers with the new product Healthy Bake.
Marketing objectives: Marketing objectives defines the goals and the purposes of the company in the market. The primary objective of Wesfarmers is to return its shareholders with its strategic as well as corporate strategies hence having a strong market position in terms of financial status. Since the company operates as the largest public sector in the country, Australia, and commits to providing quality products along with quality services in every business sector including the retail sector. Wesfarmers, itself is a marketing-focused company whose success depends on the satisfaction of the customers. The company eagerly listens and understands the need and preferences of its customers and works accordingly. Thus to fulfill the changing preferences of its customers, the company seeks to develop new products and works on its existing products to enhance its business to meet the needs of the customers.
The main marketing objective of Wesfarmers will be
- To focus on returning quality returns to its shareholders as much as they can.
- Introduce new products.
- Retaining of the existing customers.
The above-mentioned objectives for the company Wesfarmers will be relevant with the launch of the new product Healthy Bake. The product that has been planned to launch will help Wesfarmers to fulfill all these marketing objectives of the company. As per the first marketing objectives, the company focuses on delivering the quality return to its shareholders by maintaining strong strategic management of the company. This objective will be fulfilled with products like Healthy Bake, because it has been developed considering the current scenario (Smith, 2020). On the other, the second objective of the company will be achieved after the launching of the new product Healthy Bake. Moreover, the company’s third marketing objective of retaining existing customers will be fulfilled since it targets not only bakery lovers but health-conscious customers too. In this way, the marketing objective kept by the company will be achieved adequately within the appropriate time frame.
The customer segmented by Wesfarmers is based on a mixture of different factors such as behavioral, demographics, psychographics, etc. The product of Wesfarmers is enjoyed by customers of every age group and demographics. The products offered by Wesfarmers depend on their production capacity, pricing, design, and many other factors. Although the strategy of Wesfarmers in terms of targeting the customers falls for epically for grocery shoppers, and shoppers of home products (Zigu, 2013). Product differentiation has been done for such a specific group of consumers. Differentiation of products in Wesfarmers depends on whom they are dealing with since it operates in several sectors. But in retail, their products mostly focused on grocery and home-based products. The same strategy goes with the new product Health Bake which will be segmented considering the above-mentioned factors such as demographics, behaviors variables, geographic, and psychographic characteristics.
Demographic Segmentation: Demographic segmentation provides a clear understanding of the targeted customers in the particular market. This segmentation assists the organization in differentiating the products based on the varied customer groups. This can be for a particular individual or the customer from different levels of groups. Here in the case of Wesfarmers, it segments its product for almost every standard of customers, from every age group. With the new product Healthy Bake, Wesfarmers keeps its same segmentation as its other products. But this time, the demographic segmentation for the product Health Bake will be for people belonging to different ages, standards, etc. Healthy Bake has been segmented for every background of the people since health is a topmost priority of the customers, so as for Wesfarmers.
Geographic Segmentation: The product segmentation in terms of demographics by Wesfarmers has been done targeting all the rural, urban, as well as semi-urban areas. The distribution channel and the supply chain management of Wesfarmers are enormously developed, and the products of the company can be found in every location of Australia and New Zealand. The new product Healthy Bake targets the same way in other geographical regions where the company operates.
Psychographic segmentation: A product that a company develops or introduces is all because of the customer's consumption, thus unless and until the company not be able to understand the psychology of the customer will not be able to provide an essential service and value to its customers. Thus customer needs and exportation plays a crucial role in designing a new product or innovating the existing product of the company. A company able to understand this psychology will be able to develop market-driven products. Thus, this segmentation is a crucial factor for the segmentation of Health Bake by Wesfarmers. The change in the lifestyle of the customers post-pandemic has been vastly changed where they prefer to have more healthy products in their daily lifestyle. Along with the eating habits remaining within a healthy environment has also been in the top preferences of the people. Thus Healthy Bake will be appropriate for the segmentation of the psychographic change of the customer’s lifestyle.
Behavioral Segmentation: Behavioural segmentation helps Wesfarmers to understand the buying behavior of the customers. The company being able to understand the behaviors of the customers will be able to develop products according to their needs (Porta, 2021). Thus, the buying behaviors have been shifted post-pandemic where customers prefer products made from healthy ingredients, which Healthy Bake provides sufficiently. Before, the habit of checking ingredients was comparatively less than the recent time. But, now, almost every customer reviews before purchasing and exploring new products. Hence, the elements present in Healthy Bake will satisfy the customer enough to buy the products of Wesfarmers.
A company's set of actions and elements for promoting its products or brand in the marketplace is known as the marketing mix. The detailed aspects of the marketing mix for the new product developed by Wesfarmers are discussed below: Pricing strategy- The Company can adopt several pricing strategies to launch the newly developed product, Healthy Bake, successfully (Henry, 2018).
Penetrative pricing- In this strategy, Wesfarmers can focus on grabbing the maximum market share. The price of the product must be set to a lower amount in the initial stage. The product price is set at a rate at which the market can be penetrated, and buyers of all segments can be attracted.
Skimming pricing- The product's price is set very high during the launch, in this strategy, to ensure that high revenue is collected from all the buyer segments (Feng et al., 2019).
High-low pricing- The price of the product is set very high in this strategy, but the product is given at heavy promotions and discounts. This strategy ensures the foot traffic increase and generates enough interest in the customers.
Channel strategy- Distribution is one of the significant aspects of a product launch. Without an effective distribution channel, Wesfarmers will not be able to make its product reach all targeted segments. The distribution channels that can be used for the product are:
Retail distribution channels- The Company can place the products in the retail stores where it already operates. This strategy is easier to execute as Wesfarmers has to capture the retail channels that are already in the market and are fully functioning.
Wholesaler or distributor- This is one of the major distribution channels for companies like Wesfarmers. Distributors or wholesalers can obtain the product in bulk from the manufacturer and resell it to the small retail outlets to ensure its reach to the customers (Tetteh & Xu, 2018).
Dealers- Wesfarmers can also contact dealers who buy product inventories from manufacturers or distributors/wholesalers and resell the inventory to customers through a retail outlet.
Promotion strategy- Wesfarmers must focus on the promotional strategy to ensure that the target customers gain the product knowledge. The product may be providing great value to the customers, but without a well-structured promotion, the company can miss out on opportunities and make a loss. The strategies which Wesfarmers can adopt for promotion of the product are:
Special introductory offer- Wesfarmers can offer the product at a discounted rate, or the speed can be reduced when products are bought in a bundle or bulk. Free deals like buy one get one can also be offered by the company.
Utilizing social media- The product knowledge can be conveyed through social media, and social media contests can also be run by the company where the winner is gifted with the product as a prize.
Sharing customer reviews- This is one of the best ways to promote the product. The honest feedback of the product from the customers who have already got a hand on it can be posted by the company. This will ensure that customer trust is built and more customers get attracted to buying the product.
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