This report begins with company’s mission statement and brief introduction. It proceeds to presenting a detailed branding, pricing and distribution plans. The major competitors of the company are categorized in inter- and intra-competitors and their strengths and weaknesses are highlighted. The differentiation strategy in relation to closest competitor is also presented in this paper. StarTech is presented as struggling to become market leader. The salient issues pertaining to macro-economic issues are also presented in this report. Three main market trends are mentioned in this paper as technology, status symbol and fashion. The marketing implementation strategy, for StarTech’s new product SoFab, is explained in stepwise manner in this report. The five year expansion plan for the company is presented along with the five year profitability forecasts in this report which are followed by various social media tools to be used for marketing on social media. The potential for performance and marketing plan objectives are explained in this report and various integrated marketing techniques are thoroughly explained in this paper. Relationship of Marketing Communication with the Company’s advertising strategy is presented at the end of this paper which is followed by a brief conclusion and list of references.
Company’s Mission Statement
A company’s mission statement is aimed at defining the strategic level focus of the company .
Following is the mission statement of StarTech:-
“To provide user friendly high tech smartphones at affordable prices”
StarTech is a United States based smartphone manufacturing company. The company will produce highly sophisticated and cheap price smartphones with additional set of features that will distinguish the brand from the existing ones. The top management of the company is professionally trained and completely focused to make latest technology available to people at best possible cheap prices. The top management includes one Chief Executive Officer (CEO) and five (5) board of directors including Directors of R&D, Production, Human Resource, Finance and Sales and Marketing. These directors are the heads of their departments and also present their points in board meetings.
Management of StarTech is committed to design smartphones with GPS, 4G, high speed processor, long live battery, and all other competitive features. The product of StarTech is range of smartphones with highly sophisticated built-in system and 5 year warranty of battery and processor. The main features of product includes, 5 inch large touch screen, dual camera with high resolution power of 8 Mega Pixel both, Mp4 installed, 4G,long live battery, retina display, social networks apps installed, excellent video recording. StarTech currently has only one manufacturing plant in the state of California (US). The company has plans for expanding its manufacturing to other states as well as countries. The manufacturing plant at California is developed with state of the art technology.
The branding plan of the smartphones of StarTech will have following important aspects associated with it:-
- Vision and Mission
- The vision of the smartphones of the company is as following:-
“Maximum features with optimum compatibility”
- The mission of the StraTech’s smartphones is as following:-
“To become one of the best smartphones around the globe”
- Long-term goal
The company’s long term goal is to acquire about 50% market share in the smartphones market around the globe while becoming a popular brand in the field.
The branding strategies that will be adopted by the company include following points:-
- Product Name
The product name brings good brand image if chosen in an effective manner. The product name for StarTech’s smartphones will be SoFab. The first syllable in SoFab that is ‘So’ stands for Sophisticated depicting the level of sophistication in the product whereas the second syllable ‘Fab’ stands for Fabulous which depicts the product’s fabulous features. The product name SoFab brings two more aspects in mind of the prospective consumers. First is that ‘SoFab’ seems like ‘so fabulous’ that shows high level of fabulousness in the product. The second aspect is that ‘SoFab’ also seems like ‘Sophisticatedly Fabricated”.
- Attitude Branding
The company will project the products as meeting the large requirement of smartphone by the youth through showing young people using the SoFab smartphones.
- Target Market
The main group that is targeted for the smartphones of StartTech are the youth of the country. A part of businessmen also form the targeted segment. For youth, the company will produce bright colored like pink and purple for girls and blue, green for boys. Similarly, there will be few colors for both the genders like red. For business class, the product will be made available in black and white colors.
The primary consumer of the company is the business class comprised of professional from upper middle class who need a multitasking device viable to communicate easily in any part of the world. Corporate users who need to monitor huge database, medical experts, entrepreneurs and other business world people.
The secondary class are high school and college going students, housewives, teenagers, part timers who are in search of a stylish gadget that will help to reflect their status, choice and social group synergy.
- Desired outcomes
The desired outcomes of the branding plan include following:-
- Consistently deliver exceptional products
- As business continues, customers will be waiting and excited about the company’s latest products
- The expectations of customers will be set at high quality and low price
- Competitive Edge
Competitive edge will be achieved through providing multiple features in the product including front and back high resolution cameras, high speed Wi-Fi, and voice recognition etc.
- Product description
The main features of product includes, 5 inch large touch screen, dual camera with high resolution power of 8 Mega Pixel both,Mp4 installed, 4G,long live battery, retina display, social networks apps installed, excellent video recording. Range of funky colors for teenagers and professional with stylish outlook and convenient coverings. Mini smartphones are also part of the plans to attract people who hesitate to spend more money on gadget but have profound likeness for technology. Customized design of smartphones option is also available and customers can place orders online according to their budgets
- Advertising strategies
The advertising strategies for developing good brand include social media advertising while showing clickable ads on social media. PR executives of the company will actively populate the company’s new products to the general public on social media.
- Sales Management
Sales management includes maintaining a good distribution channel. StarTech will focus more on the online selling of its products due to which resources may be easily used to distribute the products.
- Promotion campaigns
Promotion campaigns for SoFab will mostly include online promotional campaigns. Social media will be used as the standard platform for such campaigns.
Following are the key steps in determining pricing strategy of StarTech:-
- Aims and key objectives of the organization
The aim of StarTech includes providing user friendly high tech smartphones at affordable possible price to the consumers. Key objectives of the organization is to acquire maximum share in the smartphones market especially among youth and businessmen.
- Qualitative and quantitative research of the market
Qualitative research will be carried out through interviewing various people and carrying out surveys on social media. This will help in determining the pricing strategy for SoFab. Quantitative research will be carried out to find the best price for the company’s product. Quantitative research will include surveys of people on social media regarding their preferences in pricing.
- Determining an initial offering price
Initial offering price is usually kept low and for limited time period . This price will be slightly kept above the cost per unit in order to penetrate the market successfully. It is estimated that the initial price will be about $200 per unit which will enable the company to penetrate into the market successfully since the average price of popular brands’ smartphones is around 500$.
- Sketching out standard price range
The standard price range will be calculated depending on the supply and demand of the product after about a month of the launch of the product.
- Determining advertising price
The advertising price will be the initial offering price for the first month and then will be the standard price.
- Providing payment modes
Various online payment modes like Skrill, PayPal, and Web-money etc. including credit card payment will be made available to the customers.
- The distribution plan of the StarTech’s SoFab will be through online selling and distributing through a contract with a courier service company. The online selling will be done through building an online store like Amazon.com which will enable the customers not only to place their orders but to provide their feedback on the product as well. The customers will be given separate username and IDs in order to keep track of each product sold. When customers will place an order, they will be asked to provide the address where they want the products to be delivered. The company will verify the payment and send the information to the courier company. A rep from the courier company will come on daily basis and collect the products already packed with customers’ provided addresses. The products will be gathered up at a central location for onward distribution to customers. The customers will have to confirm delivery of the order on a receipt. Any complaints in the products will be entertained through a complaint form given on the company’s website.
Competitors are all the cellphone producers but mainly the smartphone producers. Apple Inc. being the gigantic competitor with huge brand value and established brand image. Apple Inc., Nokia, Samsung and likewise are noticeably the competitors . All of these can be classified as intra-competitor due to the reason that they all produce smartphones. On the other hand other cell phone manufacturers like Blackberry, Motorola, LG, and Siemens are the intra-competitors due to the reason that these companies produce cellphones.
Strengths of competitors are mentioned below against each competitors:-
Apple Inc. :
- Value $567.28 billion
- One of globally renowned brand
- Very high brand loyalty
- Yearly growth is fast-paced
- Largest mobile phone distributor in the world
- Highly qualified experts
- Large number of user friendly accessories
- High resale value as compared to other cellphone brands
- Hardware compatibility with several open source software and Operating Systems
- Excellent engineering and hardware production in consumer electronics
- Smart design and innovation
- Great focus on the environment
- Very low production cost
- Ranked second in smartphones sales
- Great ability of marketing the products
- Highly protected phones
- Strong sale among narrow consumer segment
Weaknesses of competitors are mentioned below against each competitors:-
- Without Steve Jobs, innovation may slow
- Apple Inc. sells products in highly competitive markets hence faces competition that offer similar products at lesser price than Apple Inc.
- There have been few recent problems with their main producer and supplier, Foxconn, that has caused shipment dates to be pushed back
- Not targeting low class population through promotional strategies
- Very few number of service centers – Poor after sales service
- Patent violation
- Extremely small profit margin
- Lacks its own software and OS
- Focuses on many products
- Low capacity of marketing the brand
- In-compatibility with other OS
- High dependency on corporate and government contracts
Differentiation strategy in relation to closest competitor
There are certain features that play major role in differentiating StarTech from Apple Inc. These innovative features are mentioned below:-
- Large Screen: StartTech’s SoFab will have screen size of five (5) inches as compared to four (4) inches offered in iPhones. This large screen will enable the users to view videos and photos with better aspect. It will also allow the user to typewrite any text on larger keyboard as compared to smartphones with four (4) inches screen.
- Price: SoFab will be available within the range of 200 USD to 250 USD depending upon the features available in each variant. The prices are set to target large number of customers through low prices. On the other hand Apple Inc. produces high price smartphones that range from 200 USD to 600 USD
- Color: Apple Inc.’s iPhone are available in mainly two colors that are black and white. SoFab will be made available in several colors including pink, blue, green, silver, white and black. For youth, the company will produce bright colored like pink and purple for girls and blue, green for boys. Similarly, there will be few colors for both the genders like red. For business class, the product will be made available in black and white colors.
StarTech will try its best to become market leader. The initial profit margins are kept low in order to become market leader. The company will continue enhancing the products through innovation in order to achieve market leader status and maintain it in the long run. Smartphone industry is driven by innovation hence becoming a follower in this industry would mean losing the innovation edge. A large number of smartphones are sold on their release date due to the high level of motivational drive present in the smartphone users. This high sales volume can be achieved through becoming market leader.
Macro economical Salient
There are certain external forces that poses significant influence on the business and therefore or every business setup specially the newly established needs to thoroughly analyzed these external forces in order to design feasibility plan accordingly. These forces are mainly categorized as; Political, sociocultural, economical, legal, technological and competition, environment and graph of sales in the industry . Each of these will be discussed briefly.
The political situation varies from country to country and so is the taxation rate, so it is highly imperative to give extreme importance while deciding where to export the product. For a new business it is recommended to first expand business in countries with stable political situation and leverage in taxation.
The demand of cellphones with enhanced features is increasing round the globe and there is no cultural barrier sees as yet. Business and day to day dealings of people are cell dependent and people are demanding highly technology based gadget to do different tasks like mails, video conferencing, social networking, location tracing and many other. Cellphone usage is increasing irrespective of literacy rate and every culture has shown magnificent positive response to this technology. Although, few countries have some reservations towards imported product due to religious conflicts and other political issues with US. There is another aspect of sociocultural force and that is” PII” as it entails all the relevant details like name, complete address, mail id, bank account or payment accounts, preference etc. This type of data is a huge responsibility of the company and very risky to retain because it is highly prone to malicious spasms.
Recession has struck worldwide economies and therefore the buying power dropped down in past years. People want low price product with high quality and smartphone is one of the highly demanded product of this era. This situation supports the idea of StarTech as it is committed to launch low price smartphones with extraordinary features and warranty.
Every business is subject to few legal constraints that tend to hinder its operation international as well as local level. The legal issues are related to employees’ right, wages, tax on import and export, advertisement and its content, cultural and religious constraints, and many other regulation on corruption, trade protocols, labor laws privacy of data, foreign exchange rate, working environment and hours and likewise. A company needs to comply with the code of conduct mentioned by the law of each country and any retraction may result in serious repercussion.
There has been a great boom in technology and internet and more research in going on to make technology based gadgets. Awareness among people is increasing both at professional and domestic level. Internet has the enfolded the world into a global village and distances are reduced to video calls. This tremendous advancement in technology has automatically prompted the demand of have more and highly technology based smartphones all over the world. Plans are in pipelines to link every business, hospital, college, university, city, district and other activity places through central network linkage. People like to shop, bid, and complain online. Companies have made highly professional website to facilitate the process of interaction with customers online. Technology has revolution the lifestyle of people and smartphones are needed to reap greater benefits of technology.
Competition in this industry is cutthroat as gigantic players are already in the market. There are over 20,000 cellphone producers but the foremost competitors are Apple Inc., HTC, Samsung, Motorola, Sony Ericson, and Nokia.
Healthy and safe environment is the first concern of every country and global warming due to packaging material and radiations released by cellphones are highly dubious. Pressure is increasing on the companies to obtain approval from international environment committee.
Cellphone industry is highly profitable and has earned huge profits due to ever increasing demand of new and advanced features, colors and styles of cellphones. Studies have shown that the graph of cellphone sale will tend to rise in coming years.
The trend of ever changing technology has strong effects on smartphone business market. The company can easily capitalize on the advancing technologies through acquiring them on right time while carrying out proper in-house R&D. The head of R&D will ensure in-depth research and development of a user friendly high tech smartphone.
2) Status symbol
Smartphones are nowadays considered as status symbol; however, this trend may vary in future. StarTech needs to keep on enhancing and innovating with time in order to continue capitalizing on this trend while minimizing the cost. Director Sales & Marketing will be responsible to project the product as a status symbol in various ads at online and other media.
Smartphones are used as fashion these days. People take their self-pictures on mirrors in which their smartphones are also shown. Many female consumers prefer to have a smartphone with many colorful casings in order to use appropriate color casing that suites their dress and other accessories. The company can capitalize on the fashion trends through introducing multicolor casings and keep on innovating various styles of smartphones that are in fashion during the time.
1) Feasibility plan: This step will require about 16 weeks
The development of feasibility plan includes study of market including the market standing of each competitor. Feasibility study of launching the company’s product will be based on following steps and time required:-
- Planning the feasibility study: This step will require about three (3) weeks
- Hiring of staff for the study: This step will require about four (4) weeks from advertising for staff and carrying out recruitment processes
- Implementing the study: This step is the main part of implementing feasibility plan and will require about six (6) weeks for execution
- Writing up the results: This step will require about two (2) weeks
- Distributing the study results: Distributing the results among the company’s management will require about one (1) week
2) Development of aim and objectives: This step will require about two (2) weeks
Developing objectives is an important step of implementation strategy. The aim of StarTech includes providing user friendly high tech smartphones at affordable price to the consumers. Key objectives of the organization is to acquire maximum share in the smartphones market especially among youth and businessmen.
3) Identifying task and resources: This step will take about four (4) weeks
The company needs to plan it’s financial as well as human and equipment resources. It mainly includes the establishment of the company’s headquarter, franchises, and online & offline stores. The company will need to hire experts from R&D, marketing, HR and accounting fields.
4) Allocation of budget
Budget allocation is a critical step in the implementation strategy. StarTech will require to allocate budget for each step of launching the product. StarTech will need about 2.5 million USD to start the business. This large amount of funds will be acquired through taking loan from banks while presenting the feasibility study carried out in previous step.
5) Delegating responsibilities
Responsibilities are required to be delegated through identifying necessary duties and responsibilities of each position of the company. The company will be headed by a CEO and about 05 board of directors. Each board of director will represent major departments of the company. The directors will be from finance, marketing, HR, R&D and operations departments.
6) Monitoring and Controlling
Monitoring and control is also an important step in the implementation strategy. A plan cannot be considered as completely implemented unless proper monitoring is carried out on the implemented plan and appropriate control is applied. A separate department with the name of Quality Control will be established that will carry out monitoring and control of plan, processes and products.
Five Year Expansion and Profitability Plan
The five year expansion plan by StarTech is mentioned in below mentioned paras:-
The company will initially spend all of its profits for about three (3) years in business expansion and subsequently about 50% of profits will be utilized in the company’s expansion for two (2) additional years.
The company’s profits for next five (5) years are mentioned in below shown graph and table:-
Below mentioned table shows the investment for each year that will be made for the purpose of company’s expansion:-
Social Media Tools
1) Promotional Campaigns
Extensive promotional campaigns for promoting SoFab of StarTech will be launched on social media. These campaigns will include reports being published on social media, competitions for promoting products through asking questions and giving prizes. Promotional campaigns on social media will enable the company to quickly reach out to the youth of the country as well as rest of the world. The main social media websites that will be targeted are FaceBook, and Twitter. The main reason to chose FaceBook and Twitter is that the youth of the day is highly active on
2) Public Relations campaigns
Social media marketing communication is a radical communications tool that has changed the ways through which PR is practiced, and have become an integral part of business communications for many companies. Social media offers public relations executive new options for each aspect of the corporate communications process. From research to development, social media can be utilized to develop and distribute meaningful information to larger range of audiences than traditional media .
A large number of PR campaigns will be launched even before the launch of the product. StarTech’s marketing department will comprise of a five (5) member team which will be responsible for launching extensive PR campaigns on various social media websites including Facebook, Twitter, Google plus, LinkedIn, and various other websites.
3) Advertising on Social Media
Social media advertising is an important aspect that needs to be considered by StarTech’s marketing department. The advertising on social media will include clickable ads placed for the target consumers. Almost every social media website offers targeting consumers while defining their demographic details. The target consumers will be selected based on their age that is from 16 to 26 for youth for which the ads will display colorful smartphones. The consumers with ages above the youth range will be shown ads of smartphones with sober colors like black, white and silver in order to attract them in better manner.
- Performance Standards
Sales: Sales is the best performance standard that will show the level of objectives achieved. Sales volume will serve as the best performance indicator for the company’s management.
Market Share: Market share can be easily calculated to understand the level of performance the company is exhibiting as a result of its marketing strategies.
- Monitoring Methods
Brand Recognition: Brand recognition can be used to monitor the company’s overall progress. Social media can be used to understand the level of brand recognition among the consumers of SoFab.
Ads clicked: The ads clicked by social media users will be a good tool for monitoring the popularity of the company’s product among consumers.
- Financial Controls
Internal Auditing: Internal auditing will ensure proper usage of funds while avoiding any wastage of allocated funds. Internal audits will also be helpful in keeping people aware of the international standards of auditing that will facilitate the external auditing. Quality control will also have a finance section that will check for any financial mistakes made by the finance department of the company. External audits will help the company to identify and correct mistakes prior to the external audits.
External Auditing: External auditing will ensure that the company is meeting international standards and utilizing the finances in proper direction as per the company’s mission and vision statements.
Potential for performance and marketing plan objectives
Marketing objective has been already defined in these reports that are both qualitative as well as quantitative. These objectives will surely help in setting marketing aims and evaluating the company’s performance. The defined objectives should be either measurable in terms of quantity or quality in order to map the campaign’s effectiveness and efficiency at the completion of the plan’s term. The quantitative objective will be to capture at least 50% of market share in the smartphone markets around the globe whereas the qualitative objective will be to become market leader in the smartphones industry. The company will increase the market share through extensive marketing and effective distribution channels around the globe. On the other hand becoming the market leader would require extensive research and development of the high tech smartphones. Innovative features will be made part of the products with continuous improvements. The performance of the company will be primarily based on the marketing plan objective to achieve market share of 50%. The company’s production and R&D department will play main role in achieving the task along with strong support from Sales and marketing department.
Marketing objective performance evaluation is an important part of integrated marketing communication.
Integrated Marketing Techniques
The integrated marketing communication that will be adopted by StarTech include following points:-
- Knowing the target audience
There exist no general audience that can be considered as the audience of integrated marketing communication. Every company needs to communicate with a particular audience making effective use of the available resources. Segmenting particular audiences as groups on the basis of characteristics helps to identify who are the customers that will most probably utilize or purchase the products.
The target audience of the StarTech is distributed in primary and secondary audience. Target audience for the marketing communication of StarTech will be the target consumers. The primary target audience of the company is the business class comprised of professional from upper middle class who need a multitasking device viable to communicate easily in any part of the world. Corporate users who need to monitor huge database, medical experts, entrepreneurs and other business world people. The secondary target audience are high school and college going students, housewives, teenagers, part timers who are in search of a stylish gadget that will help to reflect their status, choice and social group synergy.
- Developing situation analysis
Situation analysis is commonly referred to as the SWOT Analysis. It is a structured analysis of evaluating the strengths and weaknesses of the company. Opportunities and threats are also mentioned in same analysis that impact the brand. The situation analysis also provides much awareness of both external and internal conditions that lead to an effective integrated marketing communications strategy.
There are certain external forces that poses significant influence on the business and therefore or every business setup specially the newly established needs to thoroughly analyzed these external forces in order to design feasibility plan accordingly. These forces are mainly categorized as; Political, sociocultural, economical, legal, technological and competition, environment and graph of sales in the industry. The details of all of these factors are already described in this report.
- Determining marketing objectives
What a company needs to accomplish through implementing the integrated marketing communication is documented in this step. The defined objectives should be either measurable in terms of quantity or quality in order to map the campaign’s effectiveness and efficiency at the completion of the plan’s term.
Marketing objective definition is an important part of integrated marketing communication. Marketing objectives of StarTech are mentioned below:-
- Increase the Market share by 10 % per year
- Increase the ROI on by 2% per year
- Improve customer satisfaction by 5 points per year
- Increase brand equity by 10% per year
- Users’ attitude
- Brand awareness
- Brand image
- Market position
- Determining budget
Determining budget requires having realistic estimates as these shape the strategies and tactics the company develops. Once the budget estimates are determined, the company will require to re-calculate the detailed budget after the fifth step of integrated marketing strategy in order to further improve budget allocations.
Budget allocation is required to be determined carefully since sales are directly dependent on the level of marketing carried out. The budget allocated for the first year will be of higher value as compared to subsequent years in order to become market leader in least possible time. The first year budget allocation will require about 50,000 USD on the online marketing alone.
- Tactics and Strategies
Keeping in view the objectives laid in step three strategies for implementation are designed accordingly. Tactics are used to achieve already set goals and strategic objective by implanting feasibility plan with maximum utilization of available resources and management expertise.
- Measurement and Evaluation
The most crucial part of the business plan is to use must effective measurement standards in order to evaluate the progress of activities in the direction of objectives. Integrated marketing communication strategies need to examine through specially designed measure standards and corrections are made accordingly in order to support business plan. Financial resources should be allocated and utilized in support to marketing objectives. Marketing communication is very pivotal in determining the brand visibility and brand value among general public and strict measures should be adopted to ensure fruitful results. StarTech will form a team of experts for the purpose of measurement and evaluation.
Relationship of Marketing Communication with the Company’s advertising strategy
- Knowing the target audience
The advertising strategy undertaken by StarTech has three major part which are all focused on social media. These three parts are promotional campaigns, PR campaigns and online advertising. Knowing the target audience is very easy in all the three strategies of advertising. In case of clickable ads by the company on social media website, knowing the audience is extremely easy as it is provided by the social media websites on which the ads are placed. The websites show complete demographic summaries of the clicks on the ads.
- Developing situation analysis
Situation analysis is easily developed in case of StarTech since the political, economic, legal, and other external market factors are easily available in case of smartphones market. Situation analysis has been developed in this report while covering all the major aspects that are in line with the company’s integrated marketing communication strategy.
- Determining marketing objectives
Marketing objective have been already defined in this report that are both qualitative as well as quantitative. These objectives will surely help in setting marketing aims and evaluating the company’s performance.
- Determining budget
The company’s first year’s marketing budget has been determined as 50,000 USD for online advertising campaigns. The subsequent years will have variable marketing budget depending on the effectiveness of each of the marketing technique. The marketing budget will be having the focused usage as per the effectiveness of the marketing technique.
- Tactics and Strategies
The company’s marketing tactics and strategies will be to target the youth to maximum possible level due to the reason that the youth is always fond of new technologies and modern gadgets; however, they are unable to buy expensive smartphones due to their limited pocket money. StarTech’s low price smartphones will enable the youth to buy smartphones at low prices.
- Measurement and Evaluation
StarTech will carry out the measurement and evaluation through forming a separate team of experts of the field. These experts will be tasked to carry out measurement of the effectiveness and efficiency of the marketing strategies and the evaluations made by them will be considered by the top management in order to take decision on focusing more on a specific marketing technique than others.
StarTech needs to expedite the process of carrying out all the necessary steps for developing its plans of launching its smartphones with the brand name of SoFab. Currently, it seems like that the market is well saturated due to many cell phone and smartphone manufacturing companies present around the globe. StarTech needs to capitalize on the market trends in order to accommodate its customers’ needs. StarTech needs to keep the price of its product to lowest possible level in the initial stage until its products get popularity and good market share in the market. The company may however, increase the price in later stage while identifying the market demands for its SoFab smartphones. StarTech needs to put in its best resources and experts to penetrate the market through social media marketing techniques while formulating plans on the principles of integrated marketing techniques.
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