BCO101 Fundamentals of Marketing and Digital Marketing
Discuss about the:-
Develop a marketing plan for any online service offered in any industry of your choice.
Answer:
Introduction
The following report is based on a marketing plan for the organization JB Hi-Fi located in Australia. Due to the advancement of technology, the many online retailers in Australia gained popularity in the market. The people in Australia have become more accustomed with e-commerce. Due to the transparency as well as reliability of service providers, the consumers grow a sense of trust towards the online retailers, which positively influences their buying behaviour. In addition to this, Australian online market provides access to unique as well as authentic brands. Recently, the exchange rate started trending positive for global shoppers in a rapidly developing platform. In order to support the international commerce as well as the global shoppers, online service providers in Australia have made large investment and partnership to modernize the global fulfilment and enhance the payment process.
A strong adoption of technology by consumers in Australian market has been observed, which remains as the catalysts for supporting the digital touch-point of the customer journey (Slowikowski and Jarratt 2013). Thus, due to the availability of technology and acceptance of consumers, Australian online retail market is rapidly growing. Many service providers are there in the market to strengthen their position. Thus, the state of competition in the market is high; thus, it is necessary for JB Hi-Fi to develop a marketing plan to gain competitive advantage and strengthen the position in the market. The company intended to launch a new product called “Venus-Planet of Toys” in its online portal. Venus-Planet of Toys is drone camera with 720P C4009 Wide HD lens. The following report demonstrates how the developed plan is framed.
Background of the company
JB Hi-Fi appears to be somewhat of an odd breed in Australian retailer. The company at the initial stage was a brick-and mortar shop but due to its increasing ability, the company has turned its business in into in-store to the online platform. The online revenue of JB Hi-Fi is increased by 13.6% in 2015, which is accounted nearly $75 million. In addition, the overall sale of the company increased 2.2% of total sales (JB Hi-Fi 2017). It is also observed that unique visitors to JB website portal reached nearly 1.3 million per week, which is by 9.9% in 12 months (JB Hi-Fi 2017). Furthermore, it is also observed that JB Hi-Fi also made the investment in digital content platform. After the growth achieved in 2014, the retailer started selling digital music, games, movie, book content and many more. The major goal of JB Hi-Fi is to provide a customer with a choice on how they intend to shop at Hi-Fi for digital as well as physical content.
SWOT analysis
|
Strength |
Weakness |
|
· E-commerce vendor JB Hi-Fi has the alternatives of benefitting from a structural advantage as it has lower operational cost and then brick and mortar store (Terzi 2011) · A strong marketing expertise in the digital sector · Large footprint in Australian states with increasing revenue · Good and positive relationship with popular brand such as Samsung, Sony, LG and many others (JB Hi-Fi 2017) · The brand JB Hi-Fi has successful track record in e-commerce. The online sales of Hi-Fi was growing at 13.9 % a year on average (Lockshin and Cohen 2011) · JB Hi-Fi has the growing market for consumer electronic products such as games, music CDs and Smartphone |
· Heavy reliance on brick and mortar location as at time when the online service was increasing at rare of 14.2% on an annual basis · Limited profit margin of 3.54% only in the last year (Addis 2016) · The firm is highly dependent on the supplier credit, which means an increasing percentage of the goods JB Hi-Fi stores are not paid for. Rather, the manufacture ships the items and receives the payment when the goods are sold. This means if the employees do not sell, Hi-Fi may have to pay for it after a specific time period. · Increasing reliance on the luxury items only such as video game, music but the demand can fall off and the economy goes down. The company is withdrawing its focus from other items |
|
Opportunities |
Threats |
|
· There is a growing market for digital and consumer electronic products such as Smartphone, video games and other technological device. · People around the world increasingly embracing the advancement of technology; thereby, the demand for consumer electronic product will increase in the coming years, which is a significant opportunity for the JB Hi-Fi · The continuous stream of new models of Smartphone enhances the consumer interest as well as sales , especially for i-Phone and Samsung Smartphone · Increasing popularity of sales such as holidays such as Black Friday creates publicity and it increases consumer interest as well. |
· It is identified that delivery of digital products such as movies, video games decrease s foot traffic · Online media delivery platforms such as Amazon, Apple, iTunes and Netflix replacing digital media products as the major source of entertainment such as video games · Certain changes in the technology could make some products of JB Hi-Fi depend upon for sales obsolete. For instance, the Smartphone and Tables are replacing the personal computers, laptops and streaming videos. CD and DVD players are also becoming redundant. |
Table 1: SWOT analysis
(Source: Awais and Samin 2012)
PEST analysis
Political factor- The most significant politicized issue that JB Hi-Fi in Australia its tremendous amount of information that company has its system regarding the customers. Even though, the JB Hi-Fi does not use customer’s information, the brand has to deal with the increasing pressure come from the government of the country (Chiu et al. 2014). The firm come into the discussion with the government regarding the improvement of privacy policies on internet.
Figure 1: PEST analysis
(Source: Zhelyazkov 2012)
Economical factors- JB Hi-Fi includes offering and deals from local, national as well as international sales, which enable the customers to select from several category of products within a same sector. Although, JB Hi-Fi is famous for its low cost product in Australia, the economy does not have many records of economic fall; thus, the consumers prefer to buy high quality of products. The consumers do not have much interest in low-price products (Tingchi Liu et al. 2013). However, recent economic failure in Australia changes the scenario, as many online service providers like JB Hi-Fi had to cut down the cost of operation and sell the products at low price.
Social factor- The people in Australia tend to follow the trends and fashion. The people prefer to buy latest and innovative products. There are many sites that provide latest and trendy products, which increase the competition among the retailers. The people in Australia are more concerned about the quality of products instead of price, as the economy is stable in the country (Sohaib and Kang 2014). In addition to this, many sites provide mate shopping and allow people to discard old partners and begin afresh. Nevertheless, JB Hi-Fi does not have those categories developed since it does not becoming dating with the increasing number of people facing. Thus, some service providers keep this category as the revenue source. Nonetheless, JB Hi-Fi is not intended to develop such category.
Technological factors- JB Hi-Fi evolved as the consequence of technological driven environment where internet had made it convenient for people to get hold of their favourite items within few days to compare the price of the products globally. Due to the technological advancement in Australia, JB Hi-Fi has gained the ability to convert its business to e-commerce from Brick and mortar. In addition to this, the consumer electronic products like Smartphone, tablets and ipad have made it essential for the company to improve as well as mould their online portal in an advanced way (Priem, Li and Carr 2012).
Target market and customers
The target customers for the proposed product Venus-Planet of Toys are the security personnel in the country. The regulatory bodies of the nation who have to keep an eye on crimes and accidents could use this drone camera. By using the device, the security personnel sitting in a room can control the device flying in the sky. The drone could cover 15 km in 20 minutes with a flying height of 52 meter. Thus, the security personnel could observe a vast area sitting in a control room.
Target market-
As the product will be sold through online, the company focuses on the vast market. The users from any region could place the order.
Marketing mix-
Product- The proposed product of JB Hi-Fi is Venus-Planet of Toys, which is developed designed with 720P C4009 Wide HD lens. The drone could travel up to 15 km in 20 minutes. It can fly up to 52 meter. Thus, a wide area can be observed sitting in a room with the camera flying above.
Figure 2: Marketing mix
(Source: Self made)
Price- The price of proposed product will be around AUD$ 369.87. Based on the existing pricing strategies, the price of the new product is set low. Even though, the price of the product is comparatively low than other e-commerce site but it might help the company to gain competitive advantage, as no other sites like Bing LEE did not introduce such product yet.
Promotion- In order to promote the products at the initial stage of launching, additional 15% discount will be provided on the first purchase of the products. Each premium and general customer of JB Hi-Fi could avail this opportunity of 15% discount on the overall price. In addition to this, the advertisement of the product will be shown to all popular social media tools such as YouTube, Facebook and Twitter.
Place – As the product is a consumer product, it should be available as far and wide as possible. Moreover, as the product will be sold online, the retailer has the wide platform the place the product in the market.
Budget required for the marketing plan
|
Number of Activities |
Budget |
|
Raw materials required for the designing the product |
AUD$1000 |
|
Labour cost required for manufacturing the product |
AUD$2000 |
|
Promotional Activities such as advertisement |
AUD$5000 |
|
Total |
AUD$8000 |
Implementation plan and Control
In order to implement the plan, the company first needs to identify a special occasion such as Christmas day when people will be intended to shop. However, before launching, the product, it is necessary to promote the products. Thus, details of proposed product will be provided on the website. The users visit the page for buying other items could see the ads of the products. As JB Hi-Fi has the data about the customers such as email and mobile number. Thus, personal emails can be sent to the users to make them aware of the new products. Most importantly, it is necessary for the company to launch the product on a special occasion when the company has achieved the success of existing products. Thus, the brand impression in the market remains strong and as the result, the launch of new product will be successful.
Evaluation and monitoring
After launching the product, it is necessary to look at the records. The company needs to compare the past record of sales and profits as well as the profits of after launching the new product. Likewise, it is also important to look at the customer base such as number of customers purchased the products and the customers discarded the items. In addition, the sales department of the company should analyse the number of customers liked the products but did not buy. Based on evaluation, further strategies will be implemented.
Contingency plan
As the e-commerce platform is Australia is stable, JB Hi-Fi might have to deal with the large competitors like eBay and Amazon. These competitors have the ability to replace the product with more increasing quality. In addition, the company could have to deal with government’s concern as the price of new product is comparatively less and below industry average price. Therefore, to deal with such risk, the company should pay equal amount of attention to other items as well to keep the balance in sales.
References
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Awais, M. and Samin, T., 2012. Advanced SWOT Analysis of E-commerce. International Journal of Computer Science Issues, 9(2).
Burns, A. and McGrail, S., 2012. Australia’s Potential Internet Futures: Incasting Alternatives Using a New Technology Images Framework’. Journal of Futures Studies, 16(4), pp.33-50.
Cavusgil, S.T., Knight, G., Riesenberger, J.R., Rammal, H.G. and Rose, E.L., 2014. International business. Pearson Australia.
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Chiu, C.M., Wang, E.T., Fang, Y.H. and Huang, H.Y., 2014. Understanding customers' repeat purchase intentions in B2C e?commerce: the roles of utilitarian value, hedonic value and perceived risk. Information Systems Journal, 24(1), pp.85-114.
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JB Hi-Fi 2017. Australia’S Largest Home Entertainment Retailer". Jbhifi.com.au. N.p., 2017. Web. 14 May 2017.
Kim, W.C. and e Mauborgne, R., 2014. Blue ocean strategy, expanded edition: How to create uncontested market space and make the competition irrelevant. Harvard business review Press.
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Priem, R.L., Li, S. and Carr, J.C., 2012. Insights and new directions from demand-side approaches to technology innovation, entrepreneurship, and strategic management research. Journal of management, 38(1), pp.346-374.
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