MKTG3000 | Management | The Market Segmentation Of The Company

Identify potential market segments (target markets) in the chosen country and consider how they might be serviced by your organisation. You must show your understanding of the concepts involved and your ability to think through and express marketing strategy options. In justifying your choice for the STP strategies, you must:

Explain the strategic approach you used to segment the market, and justify why you have selected particular target market segment(s) in the chosen market. These may be within the B2B sector, B2C or a combination; and

Identify your recommended positioning strategies for each target market.

--Market Entry strategy and segmentation

- Global market

The Global markets of the organisation selected expended in the country of North Western Europe, Australia, Nordic, Norway and Sweden outlet

- Growth factors

The foremost growth factor of the organisations notice for the gradual expansion is the ability to adapt to the changes in technology as well as the implementation of new products offered that is attracting customers day by day

-Aims

The aim of the organisation is to make proper amendments in human daily life operation to ensure as safe as well as Healthy lifestyle free from factors related to diseases

a) Franchising, Partnership, Direct B2B Retailing

It can be stated that this is a common strategy for a company entering a new market in their operational strategy. It can be stated that the business organization operating in the same segment are a target in accordance with their company size and the trade margin. The company will generally look for company demanding high units of good that will be beneficial for the company to increase the sale volume to the Singapore market. This will prove to be significant for the company in order of entering and operating in new market. B2B is a procedure of business which are affected by various factors which are social, political, economic and environmental in nature. Such as the social difference and similarities within two firms can define their relationship and trade in the future the same goes with other factors. The same goes in case of the strategy used by 2XU there can be various factors which can affect the operation of the company in relation to another company in the new market which can be both negative as well as positive in nature. Geographical factors play a huge role in B2B marketing strategy 2XU has also considered the following it can be said that the company has focused on retail stores as well as organization which has geographical advantages and exposure to the local consumers. This will bring high amount of demand for the company and will increase the sales turnover of the form after its entrance in the market. It can be said that the B2B which will comprise of all the strong local vendors in the market, retail outlets and big marketing outlets which will provide proper exposure to the products of the company. This will create demand for the products in the future ultimately helping the company to create their own outlets to establish and affect direct B2C business in the Singapore market. Although in the current situation the company will choose to enter the B2B market segment as this will be the most suitable and viable marketing strategy which the company can be used for increasing there consumer in the market. This will ultimately increase the hold of the company within the market deriving higher of customer for the company in the future days of its operations.

Franchising

The organisation also needs to consider the objective of franchising to ensure that there is a rabbit market expansion around the society. With the implementation of Rapid market expansion, there will be a joining of objectivity and traction where customers will be attracted to their growing possibility (Andaleeb, 2016). With the utilisation of franchising the organisation selected that is 2XU. The greater operation of the organisation needs to be well presented to ensure that their business to business model does not only become unique with franchising but also gain the understanding of strong brand recognition.

Partnership

Partnering is another strategy that the organisation the 2XU, can utilise because with it there will be support of other partners while entering into the foreign market around the world. The arrangement for marketing and core marketing policies could also be easily associated with the management when there is a partnership going on within the market for the defence of knowledge, contact and wise customers

Advantage and disadvantage

It can be said that the consumption or demand level of the different company is different in some companies it can be high or in some companies, it can be low but there will a significant amount of demand which will financially help the company you enter a new market like Singapore (Sawhney et al. 2017). There is a narrow limitation in the B2B market segmentation limits in terms of contractual rights it can be said that business can enter contract for trade which will limit the and create bind between the two companies for their future trade.

One of the prime advantages that franchising present to any organisation is the reduction of risk in business failure. There is a possibility to make a proper step for the establishment in market share. However, the cost may get higher than the Organisational Management team may expect and the franchisor may also go out of business that would result in difficulty in the selling of the franchise in the future prospect

b) Preferred market entry strategy

The organisation could eventually use partnership as their format of business strategy but they would face the risk of this agreement among the partners which would lead to irresponsibility among them. Where can also be a risk of partners leaving the organisation which may hamper the general business management operation. However, with the implementation of partnership, the organisation could be benefited as because there can be high calibre workers and partners in the organisation providing them with ideas and objectivity.

STP

Segmentation targeting and positioning are the modern day aspect of marketing which ensures that an organisation is well equipped with understanding values and thoughts of development opportunities. The STP model is utilised for making sure there is a creative marketing plan communicated among the organisation. To deliver a proper format of the Business plan and a successful business operation in the long run of Organisation (Camilleri, 2018). The focusing of the segmentation factor is actually based on determining the market segment in characteristics wise. Under the valuation of market targeting, there is the selection of one or more segments who will be easily lured towards the product and Services within the organisation. Under the section of product positioning development of marketing mix as well as the understanding of the product positioning segment for availability is discussed in descriptive format.

Segmentation

Profile

For understanding the impact of the product that the organisation provides in the society there is enough knowledge of the views and ideas of the customers present. On considering the profile segmentation of Singapore Market by the organisation selected, only the people who are based on sports industry health fitness, as well as gym freak, will be profiled properly

Demographic

On considering the democratic aspect of Singapore, It is seen and observe evidently that there is a huge market growth for any organisation whoever is willing to invest their business operation. In accordance to 2017 report total population increased from 5607000 in 2016 to 5613000 in 2017. This certainly clarifies that they grow in the population result in increasing market opportunity for any organisation willing to provide their support in business operation (singstat.gov.sg, 2018). It is noticed that the old age ratio has decreased from 5.8 to 5.5 that suggest that healthy enough among the people around the Singapore community is increasing day by day (singstat.gov.sg, 2018). The organisation is a sports enthusiast and providing products related to the sport will be benefited when considering it long-term investment plan Singapore

Psychographic

The psychographic conditions noticed that the people in Singapore are quite enthusiasts towards health consciousness and sports. Being health conscious, most of the people are well aware of the sports department in the society of Singapore

Targeting

The 2XU company is new in the Singapore market and is quite uncertain about the performance of their products in the market, although there is good demand for Athletic Garments in the market as due to the emerging athletic young generation in the city. The market strategy used by the company is business-to-business commerce model. The company has done already done a great profitable business in origin city but not likely to take the risk for evolving in a new city. As a business-to-business commerce model is a much safer option than that of business to commerce model, the company is more likely to choose for Business to business model of commerce.

In business-to-business model there is the manufacturing company does not deal with the customers, but the other selling company does, therefore the 2XU company does not require to deal with the new customers. The company direct sales their product in the other company which have already set up their retail market in the offline or online market zones. Therefore the company does not require to establish a full market for themselves as a brand. This is an experiment, if the market response towards the products and brand is positive then the company can launch their products and retail store more exclusively.

The two company deals with the huge amount of products, the goods exchange between them or the product delivered are in huge amounts. Hence creating a big wholesale market value also, resulting in better sales of the manufacturing company that is 2XU.

As the manufacturing company does not involve the customers and the market interference, they are in the more softer side. There comes the point market predictability, this company does not require predicting what the possible market will in the future. If the sales of their product will decrease they will alter in the production or manufacturing line, as the market of the given city requires it. Hence, if involved in more business opportunities and advancement in the business market will beneficial for the company.

As the sales unit for the 2XU company is high, due to the reason of the wholesale unit provided by the company, the company have lower manufacturing cost and a chain of high-profit-margin as sales are in huge numbers.

Another main reason for choosing the business to the business model for commerce purpose is the data-centric process. As the business is done in huge numbers the time are consumed are less and productivity is very high also the profit is also huge. The error occurs in this field is very low as the maturing unit does manufacture in huge numbers. In addition, there is more detailed way calculation the data statistic of the sales and revenue as the number of entries are less and the amount on those are very high.

These are few of the justification used in order to justify the need for choosing the business to business commerce model the particular market field rather than the business to consumers commerce model type (Schlegelmilch, 2016).

Positioning

Market strategies for any new emerging company in a new market, like 2XU company in Singapore, is very important, as the market strategies decide the rest of the performance of the products in the current market. The positioning strategy for the product of the 2XU is based on product class and production process as they are the best way for the firm especially in the new market condition where the people don’t know about the brand image of the company. The advertisement for the products must be based on the production process, the material used while making the athletic garments, in order to get the attention of the public market as an individual person. The production process has shown the market advertisement should consist of some extra popular items that are not used by the competitor in the same athletic garment field (Tanner & Raymond, 2015). The innovative ideas that the company used in the production process making the production must be chosen as the requirement of the public in the market they are selling it. The company should also know the market requirements for the product process, product manufacturing and company advertising strategies. As the needs of the customers, the company should change in the manufacturing unit and at the same time show the market about the change they have made for the respective customers (Phillips, 2016). This step creates an unconscious state in the customers back of the mind that the given company is providing what they need and thus they need to buy the company products in order to fulfill their requirements. The company should also enroll new idea, new graphics schemes in order to grab the attention the consumers and the market, also adding challenge for their competitors in the same market. The company should always introduce new ideas in the manufacturing unit in order to stay in the market and also stay ahead of the competitors. The ideas and the new innovation the new market always helps in growing new company and stay in the market, it also helps in keeping a brand image stable (Pyo, 2015).

It can be said that product should be used as a differentiating tool for the company to effectively differ and have a competitive advantage over the competitors in the market. It can be stated that product differentiation will be done based on the quality of the products that will be rendered by the company in the Singapore market. The company will tend to have an effective product promotion strategy to the advantages and advancement that are there in the garment and how they are better than the products currently existing in the market. In this way, the company will be able to position different from its competitors in the market. In this way, the firm will be able to display its product dominance with respect to other products in the market. Taking such steps in the upcoming market in Singapore can help the 2XU company to grow and maintain the sales in the market and thus helping the business to be a profitable one (Zia & Kumar, 2016).

Why Singapore Market/customers

a) Opportunities

The rise in the population and the better awareness of heath management among Singapore people is the sole reason to make investment in the community of Singapore. The huge love of body fitness and celebrity endorsement in keeping body fit makes Singapore best place to be invested upon

Conclusion

Concluding in the context of the above discussion it can be stated that 2XU is following a B2B commerce and marketing segmentation model which will help the firm to effectively operate and enter the Singapore market. In accordance to the positioning strategy, the company will tend to use a production process based positioning strategy in which product will be a tool to differentiate the company to its competitor in the market this is suitable for the company to gain customers in the new market in an effective manner.

References

Andaleeb, S. S. (2016). Market Segmentation, Targeting, and Positioning. In Strategic Marketing Management in Asia: Case Studies and Lessons across Industries (pp. 179-207). Emerald Group Publishing Limited.

Camilleri, M.A., (2018). Market Segmentation, Targeting and Positioning. In Travel Marketing, Tourism Economics and the Airline Product (pp. 69-83). Springer, Cham.

Phillips, A. (2016). How books are positioned in the market: Reading the cover. In Judging a Book by its Cover (pp. 41-52). Routledge.

Pyo, S. (2015). Integrating tourist market segmentation, targeting, and positioning using association rules. Information Technology & Tourism, 15(3), 253-281.

Sawhney, M., Grayson, K., Dupree, P., Hsu, C., Metzger, R., Obuchi, F., ... & Wilson, K. (2017). Ontela PicDeck (B): Customer Segmentation, Targeting, and Positioning. Kellogg School of Management Cases, 1-6.

Schlegelmilch, B. B. (2016). Segmenting Targeting and Positioning in Global Markets. In Global Marketing Strategy(pp. 63-82). Springer, Cham.

singstat.gov.sg, (2018) Retrieved from from https://www.singstat.gov.sg/-/media/files/publications/population/population2017.pdf Accessed on 7 October 2018

Tanner, J., & Raymond, M. (2015). Principles of marketing. University of Minnesota Libraries Publishing.

Zia, M., & Kumar, N. (2016). A Three Dimensional Vertical Differentiation Model: Implications for Segmentation, Targeting and Positioning.