A company should have a strategic marketing plan in order to deal with the dynamic and turbulent market environment. The marketing mix, market segmentation and positioning and distribution channel strategies should be measured to assess whether they are assisting the company attain their revenue targets (Barlon, 2006).
The marketing mix of a company comprises of four things that is the price, product, place and the promotion. The company keeps checking that its marketing mix, product, place, promotion and product are tailored to meet the needs of the target customers.
When it comes to the promotion, the company considers the mediums of advertising that are available in the market. There is the printing media, radio, television and the recent trends in the use of advertising media. It also involves promotions, discount offers, personal sales and direct marketing efforts. There is also the use of posters, fliers and brochures with the aim of reaching more customers. It involves brand management.
This is an important area under the promotion mix. This is where the company concerns itself with enhancing its brand image. There should be an awareness of the brand in the market. A brand has been identified as a symbol or design that differentiates a company product from its competitors. In pricing strategies, the company may seek to employ price discriminative policies or a low-cost strategy in order to deal with the competition. The company may engage in premium pricing or skim pricing. This is when the company has a definite competitive advantage above the competitors. When it does this, it is sure that there will be no significant reduction in the market share. The product commands high customer loyalty. There is also penetration price strategy where the company charges a significantly low amount for their products in order to penetrate a certain market. This method is usually used where the customers are highly sensitive to price changes.
Ford strategists should establish a pricing policy for its vehicle ranges. The pricing policy for a vehicle takes into consideration cost of production, a profit margin and additionally the worth of competing merchandise out there within the market. Its sponsorship of the Champions League is a way the company competed in the market place while not changing the worth of its vehicles. This is often referred to as non-price competition. By sponsoring the Champions League, the corporate will build the status and worth of its brand. This is referred to as non-price competition.
In considering the product the company is concerned with all the product attributes that is the packaging, the product warranty, after-sale service and brand name. It also includes the value that the customers attach to the product. The company should ensure its products are of high quality. This is where focus moves from the quantity of products produced to the quality of products produced (Powell, 1995). It works to the company advantage since as customers get quality products they begin to display high levels of loyalty to the company products (Sivadass & Baker-Prewitt, 2000)
Through analysis, Ford is aware that the high population of the target customers is intriguingly fascinated by soccer. It’s doubtless they’ll visually examine the UEFA Champions League. The company’s association with the competition sanctions it to focus on them directly through many communication channels at the stadium such as TV programmed commercials and themed promotions. When it comes to the place, the company is concerned with taking the product to a convenient location for the customers. Is it accessible? The company comes up with a strategy for its distribution channels in the targeted area. There are also activities in the processing of the orders they will receive from the customers. Most companies use efficient information systems in order to be competitive. The goods are also stored in warehouses once they come from the production centers.
The Ford dealership network is one of the biggest networks in Europe. This is often where most customers can visually understand the Ford product, test drive, and ultimately make a purchase. They’ll come back throughout the lifetime of the vehicle for servicing and also the purchase of parts and accessories.
A company should carry out three activities which is known as the STP process. The company should segment, target and position itself in the industry. There are several advantages that accrue to the company when they do the three steps thoroughly. First of all, it gives the company focus and direction. They are able to engage in target advertising, new product development and brand differentiation. It will also be able to assess the growth opportunities in the market. There is also minimal wastage of resources as the company focuses on using its resources to carry out targeted advertising.
Market segmentation is the process of dividing the market into different kind of customers who have diverse and particular kind of needs. The company analyses the market in terms of their geographic, demographic and behavioral characteristics. The company does not deal with just the mass market. It chooses to divide the market into identifiable groups of customers. It assists the company to utilize its scarce resources well. Market segmentation helps the company to even engage in product differentiation across the different groups of customers.
In the second step, the company analyses the segments and decides which market it will target on. There are certain qualities that the target segment should process. The market should be accessible, measurable, profitable and distinct. The third step in the process is positioning. There are two steps involved in this process. The first step is in differentiating the company’s product so that the customers have a reason to go out and purchase the company’s product. The second step is in the company creating a strong brand and commanding significant market presence and market share.
In looking at the FORD company SWOT, there are several strengths that the company has. Ford Motors recorded the strongest likewise as effective operation performance in 2005. It is the the second largest automobile manufacturer. It also gives credit services. It has a lot of diversity in its products. Its weaknesses are several. It has been facing a lot of competition from Japan that caused it to stop producing fuel based light weight trucks. There was a dent in the company image due to high merchandise recollects. The company money reserves reduced by 4.1 Billion and the stock prices reduced to $14.7. It also has low market share in the market.
There are several opportunities available to FORD company that they should take advantage of. The company should diversify its market and tap into India and China which can boost their revenues. The restructuring changes in the company will enhance the image of the company. There are also plans to vary its merchandise towards hybrid electrical engines. There are however certain threats that the company should be wary of. The rising oil costs could severely affect the company. There are also rising material costs which are bound to increase production costs. There has also been increasing competition especially from the automobile companies that are generating ideas with low capital expenditure.
The market environment is quite dynamic. There are many factors for the company to consider such as the legal, competitive and cultural environment. An organization that is driven by the market demand is highly successful (Day, 1994). The culture of the people will determine how they will respond to a new company’s products in the market (Subramanian, 2001).
One of the biggest factors in the environment that affects the business strategy is the competitive markets. Michael Porter identified five factors or aspects in the competitive markets. The first aspect is the barriers of entry into the market. The company assesses the barriers to entry such as capital requirements, technological aspect and the government tariffs and quotas The other factor to consider is the presence of substitute products in the market (Porter, 1980, p3). The company will have to be innovative in a market with many similar goods so that they can offer to the public a differentiated product (Holcombe, 2009). Another factor to consider is the bargaining power of the buyers. The fourth factor that the company should consider is the bargaining power of the suppliers. Finally, the company considers the rivalry between the existing firms.
In the automobile industry, the company considers its external environment. Politics influences the laws and legislations that automobile makers operate in. Politics is influenced by shopper demand of environmental considerations or safer cars. Moreover, the automobile trade may be a major contributor to the economy with high usage of laptop chips, vinyl, copper, steel, and aluminum with the trade contributing to four % of the US GDP. The socio-cultural surroundings affect the kind of automobile folks purchase and also the potency of vehicles in terms of the surroundings and mileage. Lastly, the technology affects business surroundings for cars. A study by Power and Associates in 2002 shows that sixty percentage of potential patrons conduct analysis on-line. The environmental effects such the worldwide warming has additionally modified the ways in which of thinking in automakers these days, with the shift towards various fuel vehicles favored.
Marketing is one of the key aspects of a company and the type of marketing strategies employed by different companies determines the growth of the companies. The Ford Company has a lot of marketing tools at its disposal to ensure that the company has a competitive edge in the market place. It should use the marketing mix, market segmentation, SWOT analysis strategically.
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