BSBMKG501 Identify and Evaluate Marketing Opportunities Assignment

BSBMKG501 Identify and Evaluate Marketing Opportunities Assignment

BSBMKG501 Identify and Evaluate Marketing Opportunities Assignment

Part A

Part A requires you to identify and evaluate marketing opportunities for your chosen organization or utilizing the BBQfun case study.

1.Identify two marketing opportunities for the organisation on your chosen organisation’s market and business needs in terms of:

a.comparative market information

b.competitors’ performance

c.customer requirements

d.legal and ethical requirements

e.market share

f.market trends and developments

g.new and emerging markets

h.profitability

i.sales figures

2.Research potential new markets for the organisation in relation to:

a.export markets(new geographic opportunities)

b.segments of the market not currently penetrated(customers within the market not tapped)

3.Based on Q2, provide an evaluation and analysis on:

a.the various strategic marketing approaches (such as; increasing market share, developing new markets, developing new products and diversification) that the company should consider in terms of expanding their business law potential and discuss what are the likely options for implementation.

b.the types of markets and aspects of the marketing mix by ranking each of the following elements mentioned below in terms of their viability and likely contribution to the business such as distribution, products and types of promotional activities.

1.e?commerce

2.business?to?business marketing

3.direct marketing

4.ideas marketing

5.marketing of goods

6.public sector marketing

7.services marketing

8.telemarketing.

4.Using a suitable methodology, such as gap analysis, market or marketing analysis, or competitor analysis, identify and decide on two marketing opportunities to focus on and investigate further.

5.Estimate the effect of the two marketing opportunities on the business, for example:

a.effect on sales volume

b.growth

c.market share

d.profitability

e.potential competitors

6.Discuss what are the consideration of external factors(legislations including privacy act, anti-discrimination, competition and consumer act; ATO regulations and GST implications; manufacturing standards; e-commerce best practices marketing codes of practices), costs, benefits, risks and opportunities to determine the financial viability of the selected marketing opportunity.

7.Based on the selected marketing opportunities, identify changes to current operations in order to take advantage of the opportunity. Ensure changes identified are adequate to:

1.service an increased or different customer base

2.ensure continued quality of service.

8.Estimate and justify resource requirements and costs for changed operations with considerations on the following areas:

1.additional staff

2.distribution costs

3.equipment

4.promotional costs

5.staff training.

9.Provide an assessment report on the viability of each opportunity by:

a.Exploringand developingentrepreneurial, innovative or creative options (one for each opportunity) to apply the marketing opportunities in the context of the organisation(For example, if you identify an e-commerce opportunity, determine how to apply the e-commerce opportunity to the organisation including aspects such as media, web-design to appeal to target markets, integration with existing operations, marketing strategy and overall strategic directions)

b.Identify and document changes needed to current operations to take advantage of viable marketing opportunities(in terms of inventory and stock, office space and software usage).

 BSBMKG501 Identify and Evaluate Marketing Opportunities AssignmentPart B

Prepare a 15–20-minute presentation for marketing peersexplaining and supporting the twomarketing opportunities you have identified in Part A. Ensure you complete the following:

1.Based on Part A, create a PowerPoint presentation on the chosen organization’s evaluation on its marketing opportunities.

2.Highlight only the important points (maximum 3 points per presentation slide) from Part A as it is not supposed to be an exact copy of it.

3.Describe two marketing opportunities and how you identified them. Describe the process you undertook to analyse your organisation to identify the marketing opportunities.Refer to current organisational marketing plan and products/services

4.Support your choice of marketing opportunities with reference to market information such as market trends and sales figures.Include relevant statistics.

5.Describe the effect of opportunities on the business, for example:

a.sales volume

b.growth

c.market share

d.profitability.

6.Describe innovative or creative options (one for each opportunity) to apply the marketing opportunities in the context of the organisation.Refer to aspects of the marketing mix, i.e., product, price, promotion, place (distribution). Refer to principles of marketing that apply to your approaches to realising the proposed opportunities.

7.Use appropriate language and level of formality to satisfy needs of your audience. For example:

1.professional but semi-formal language

2.technical vocabulary;potential need to define more obscure marketing terms or statistical methodologies

3.assume no knowledge of specific organisational policies or marketing strategies

4.be prepared to answer questions

5.provide for response and feedback.

8.Deliver your presentation as per specifications mentioned above.

9.Your presentation will be assessed by (using a presentation assessment rubric which would cover nonverbal, verbal skills, timing and content)your trainer.

Assessment Answers

Part A

Part A requires you to identify and evaluate marketing opportunities for your chosen organization or utilizing the BBQfun case study.

1.Identify two marketing opportunities for the organisation on your chosen organisation’s market and business needs in terms of:

    1. comparative market information

Characteristics

Overview

What does it mean for BBQfun

Queensland overview

    • high population growth of 5% per year
    • new homes and renovated homes growing from a base of 50,000 per year
    • low unemployment of 4.7%.

BBQfun will witness an increase in demand if the population increases by 5% every year. The people residing in Queensland is also increasing because as per the given information the number of homes is growing from the base of 50000 per year. According to the information provided to us the employment rate of the people is also falling down and right now it is at 4.7%. If the employment rate goes down, people will not have the purchasing power to buy products from the market (Baker, 2014).

 

Geographic

    • our immediate geographic target is the area of Brisbane with a population of 2,000,000
    • a 30 km geographic area is the average store market footprint
    • the total targeted population is estimated at 450,000.

 

In consideration of geographic factors, BBQfun’s immediate target is Brisbane which has a population of 2,000,000. They want to expand their market in Brisbane so as to increase their sales revenue. As per the market research conducted by BBQfun the customer traffic for a store is within the geographical limit of 30km. BBQfun aims to target a population of 450,000 in the given fiscal year (Armstrong, et al.,2012).

 

Demographic

    • male and female
    • ages 20–50
    • high percentage of young professionals who work in the central business district
    • high percentage have completed undergraduate/postgraduate study
    • an average household income of over $70,000.

BBQfun target audiences are the young and middle age professionals or students aged between 20-50 years. BBQfun wants to open an outlet in the central business district and aims to target the professionals working in that area. According to their market research, they aim to target the households which have an average income of $70,000. Students who are either pursuing their undergraduate or post-graduate courses are also the target audience for BBQfun (Solomon, 2014).

 

    1. competitors’ performance

Competitor

Overview

What does it mean for BBQfun

The Yard

  • has a limited selection but significant depth. All Australian made. No significant marketing or promotion. The price point is high, but the quality of products is quite good. Not in south east Queensland. Considering e-commerce options. Considered potential treat for entering market through e-commerce because of large distribution network

 

The main competitor of BBQfun is The Yard. The Yard has not expanded itself geographically but has a good customer base in Brisbane. The prices of the products available at The Yard are comparatively on the higher side compared to its rivals but customers are ready to pay that price because of the quality it offers to them. They are known to provide good quality products in the market. They are even considering entering e-commerce market which can be a threat to the rest of the firms as The Yard has a good distribution network which will help them to expand in the e-commerce market and attract more consumers (Fifield, 2012).  The advantage that BBQfun has over The Yard is that the latter is not located in south east Queensland as Queensland is the target market for BBQfun right now. The Yard does not advertise or promote itself because of which most people in Australia do not know about it (Shankar, Carpenter & Farley, 2012).

 

BBQ’s R Us

  • Broad range of outdoor lifestyle products including trinkets and furnishings. Lots of cheap imports. Concentrating on established markets. Strong in the replacements segment. One store in Brisbane. Mostly in Melbourne and Adelaide. Considering e-commerce options.

It offers lifestyle products also. The other competitor of BBQfun is BBQ’s R US which offers a wide range of lifestyle and outdoor products like trinkets, furnishings and etc. It has stores in Brisbane, Melbourne and Adelaide. It has just one store in Brisbane which is an advantage to BBQfun as the target market for BBQfun is Brisbane. BBQ’s R US concentrates mostly on established markets and is known for offering imported goods at cheap prices. It is good at the replacement section of the market. Like The Yard, BBQ’s R US also wants to explore the e-commerce routes to expand its customer base and market share. If it establishes its e-commerce website then it will be able to cater to more number of customers which will increase its sale revenue (Lauer, 2014).

 

Outdoorz

  • : Large operations of only a few stores per city. Mass markets outdoor lifestyles at good value prices. No imported goods. Extensive advertising. Low to medium quality. Strong in the replacement segment rather than new and refurbished dwellings. Gaining strength in Brisbane market. Considering e-commerce options.

 

Outdoorz, another rival of BBQfun has a large market for outdoor and lifestyle products with quality varying from medium to low. They have only a limited number of stores in a city but each store has a huge customer base. They expertise mostly in the replacement section rather than new furnishing products in the market (Leonidou et al., 2013).  They only deal in local goods and take the benefit of marketing by advertising their products extensively. Like the other competitors, Outdoorz is also looking out for an e-commerce expansion to increase sales of the company. It is a competitor for BBQfun because the major market for Outdoorz is Brisbane which also the target market for BBQfun (Morgan, Katsikeaa & Vorhies, 2012).

 

    1. customer requirements

Factors

What does it mean for BBQfun

  • Selection – a wide choice of options.

A customer wants a firm to have a large product portfolio to offer so that they can choose from large variety of products and be spoiled by choices (Kumar et al.,2013).

  • Accessibility – the customer needs easy access to the store with minimal inconvenience.

The store should be located in such an area so that the customers do not problem in locating the store and can access it with convenience (Berthon Iet al., 2012).

  • Customer service – the customer needs expert customer service to help sort through choices.

When a customer enters a store to buy a product, it expects the staff at the store to help them in selecting a product by telling them about the uses of the products (Shih, Chen & Chen, 2013).

  • Competitive pricing – the customer needs all products/services to be competitively priced relative to comparable high-end outdoor lifestyle options offered by competitors.

Customers always look for good quality products which are offered at reasonable prices. Hence, they need to price their products according to the average prices prevailing in the market as the competitors are always in the lookout to attract the customers (Zeriti et al.,2013).

  • Flexible payment – the customer needs easily managed payment plan.

A flexible payment option is also a part of customer requirement as the customers should be given a credit period if they want to buy the products in instalment basis (Gummesson, Kuusela & Närvänen, 2014).

  • Quality guarantees – the customer requires three year product guarantees (as offered by most competitors).

The customers also want a guarantee for the goods they buy. They lookout for at least three years of guarantee within the time period products can be replaced by the firm (Pitta, & Franzak, 2013).

 

In the case of BBQfun’s marketing performance, we can see from the table below suggesting its findings of survey of 500 customers as follows:

 

New builds

Renovators

Replacements

What does it mean for BBQfun

Have visited BBQfun in previous month

70%

70%

50%

BBQfun needs to concentrate on the replacement sector as its market share in this sector is comparatively low.

Have bought a BBQfun product in previous month

70%

65%

50%

BBQfun has a good market share and it should retain this customer base in future.

Customer service is essential

90%

95%

60%

The customer service provided is good.

Price is most important

10%

20%

95%

BBQfun needs to be more price sensitive.

Australian made is important

80%

65%

55%

The BBQfun believes in Australian made products and sells them.

Will buy online

100%

100%

100%

The ecommerce trade of BBQfun is operating very well.

Will pay for online delivery if chosen

100%

100%

100%

The ecommerce customers are loyal to BBQfun and are ready to pay for online delivery also.

Loyalty customer

30%

20%

10%

BBQfun needs to create more customer loyalty and value.

    1. legal and ethical requirements

Types of legislation

What it is about:

How does it impact BBQfun

Privacy Act 1988

  • The Privacy Act 1988 (Privacy Act) regulates how personal information is handled. The Privacy Act defines personal information as:
  • …information or an opinion, whether true or not, and whether recorded in a material form or not, about an identified individual, or an individual who is reasonably identifiable.
  • Common examples are an individual’s name, signature, address, telephone number, date of birth, medical records, bank account details and commentary or opinion about a person.

 

BBQfun has to abide by the Privacy Act, 1988 according to which BBQfun has to handle the customers’ information as per the national privacy policies. They will have to make sure that the customers’ information is not shred with outsiders and only remains within the company (Cassia, Massis & Pizzurno, 2012).

Anti-discrimination Act 1991

According to this Act the companies cannot discriminate between the individuals.

BBQfun also has to abide by the Anti-discrimination Act, 1991. As per this legislation, BBQfun cannot discriminate between its customers on the basis of caste, sex, age, sexuality and etc (Gmelin, & Seuring, 2014).

Competition and Consumer Act 2010

The company has to maintain healthy competition and take care of its customers.

The BBQfun need to attend to the after sale service needs of its customers.

Australian Direct Marketing Association  - Direct Marketing Code of Practice

Certain codes needs to be followed by the company to advertise their products in the market.

BBQfun needs to adhere to these rules.

Free TV Australia

Adhere to the code of conduct of this association.

The company has to follow all the rules.

Australian eMarketing Code of Practice

The emarketing norms have to be followed.

BBQfun needs to follow these norms.

Australian e-commerce model

The ecommerce laws regarding trade.

BBQfun needs to adhere to these laws.

Spam Act 2003

The company needs to take care of its products and imitation.

BBQfun should not imitate the products in the market.

BBQfun’s comparative market information is largely determined by independent competition  where they focuses on locally produced products and they have a collective market share of 48%.In 2009, the national outdoor lifestyle market reached $300 million. Outdoor lifestyle sales were estimated to grow by at least 6% for the next few years. This growth can be attributed to several different factors:

    1. market share

Factors

What does it mean for BBQfun

  • the greater disposable household income from two income families

In Australia, the personal disposable income of the people is increasing which allows them with more purchasing power to buy products

  • the greater availability of affordable and interesting quality imports with the high value of the Australian dollar

The Australian market also offers a variety of import products at reasonable prices which the customers can afford (Acur, Kandemir & Boer, 2012).

 

  • the marketing by popular TV lifestyle programmes.

The Australian serials also contribute to the increase in market share as they advertise the furniture and the lavish lifestyles which people get attracted to

    1. market trends and developments

Factors

What does it mean for BBQfun

  • Item quality – the preference for high quality items is increasing as customers arelearning to appreciate the quality differences.

The customer demand for lavish outdoor products has increased and the quality requirement has also gone up.

  • Unique – our patrons appreciate the opportunity to include outdoor lifestyles in their home that stand out from the mass-produced and low-quality items.

The  customers are looking for uniqueness in the products and want exclusive products to be offered to them.

  • Selection – people are demanding a larger selection of choices; they are no longer accepting a limited offer in outdoor lifestyles.

People want a larger product portfolio so that they have a variety of products to choose from.

  1. new and emerging markets

Factors

What does it mean for BBQfun

  • A growing market in a high growth area with a significant percentage of the target market still not aware of BBQfun value proposition.

BBQfun should also advertise their products to the customers to make them aware of their product portfolio

  • Increasing sales opportunities outside of our store locations – south east Queensland.

BBQfun should expand their operations to south east Queensland to take advantage of the growing market.

  • Growing opportunity for online sales.

They should also consider entering the e-commerce routes to reach out a large number of customers.

 

  1. profitability

Factors

What does it mean for BBQfun

  • Economy - thereal estate market in south east Queensland continues to rise in price, and with it the disposable income of the population.

As the economy of Australia is increasing, the personal disposable income will also increase. This will lead to a rise in demand.

 

  • Political - the present Government focus and emphasis in future legislative direction will be about growth and productivity

The government is also aiming at helping the firms to grow and develop in future.

 

    1. sales figures(forecast)

 

2014

2015

2016

How does it impact BBQfun

Total sales

$11,000,000

$12,000,000

$15,000,000

Increase in sales volume helps the company to expand its operations.

Gross profit

$5,110,000

$6,500,000

$7,500,000

The gross profit will help the firm to meet its expenditure.

8.Research potential new markets for the organisation in relation to:

Potential new markets

Factors

Options

Considerations

F or U(favourable or unfavourable)

  • Export markets

(new geographic opportunities #1)

UK can be an option for BBQfun to expand its business operations. UK has conducive political environment for any business to conduct its operations in and is also inviting foreign companies to invest in their economy.

favourable

(new geographic opportunities #2)

USA can also be an option as it has a growing GDP, which results in an increase in the personal disposable income of the people. The people have high purchasing power, which increases the demand in the economy. USA also has a good demographic population which suits the target audience of BBQfun.

favourable

(new geographic opportunities #3)

China is also a country where BBQfun can seek opportunities to expand. China is the world’s fastest developing country and has a strong economy which generates demand. The only problem with China is that they have strict laws and regulations for the foreign companies to allow them to enter into the market.

unfavourable

  • Segments of the market not  currently penetrated

(customers within the market not tapped #1)

In UK, the BBQfun should focus on the premium lifestyle range of products, as the companies in UK have not made any significant move to penetrate that part of the market. The premium market for lifestyle and outdoor product is still unexplored and expanding in this area would reap benefits for BBQfun.

favourable

(customers within the market not tapped #2)

In USA, the market for low cost imported goods has not been explored yet. the local goods market is so strong there that the business man there have not properly exploited the imported goods sector. Hence, BBQfun can concentrate on this part of the market.

favourable

(customers within the market not tapped #3)

In China also the imported goods market has not been explored because of the trade restrictions by the government. Hence, BBQfun can explore this market if they get permission from the Chinese government.

unfavourable

9.Based on Q2, provide an evaluation and analysis on:

a.The various strategic marketing approaches (such as; increasing market share, developing new markets, developing new products and diversification) that the company should consider in terms of expanding their business potential and discuss what are the likely options for implementation.

Strategic marketing approaches

Factors

Options

Considerations

F or U(favourable or unfavourable)

  • Market penetration

(present market, present product)

Market share growth

The outdoor and lifestyle market in UK is growing at the rate of 6.6% per anum. Therefore, with the existing line of products that BBQfun offers, they can venture into the UK markets.

USA and China market is also at a growing stage and it would be advisable for BBQfun to explore the imported goods market of both the countries.

favourable

Customer loyalty improvement

In today’s world, the customers are only loyal to those companies that offer good quality products at lower prices. Therefore, BBQfun will have to concentrate on manufacturing good quality products at reasonable prices to attract customers. In UK and USA they will not face much stiff competition but in China they will have to find ways to reach out to the customers because China has a huge market which offers goods at low prices.

favourable

Customer value improvement

The company needs to concentrate on providing after sale services to its customers to create customer value. They will have to ensure that in each market they satisfy the needs and wants of their customers(Zhou, 2012).

favourable

  • Product development (present market, new product)

Design

All the three countries market focuses on the design of the product. BBQfun will have to make changes in the designs of their goods according to the tastes and preferences of the customers of the country they want to cater. Very market has different taste and preferences, which BBQfun has to understand (Bellandi, & Lombardi, 2012).

Favourable

Technology

Technology used by BBQfun will have to be advanced and up-to-date to combat the competition it will face from its competitors. If BBQfun expands its market in China then their technology has to be the best in the market because the Chinese market is highly advanced and technologically forwards.

favourable

Distribution

BBQfun will also have to concentrate on establishing its distribution network to make sure that their products are easily available in the market. In establishing a distribution network, BBQfun will not face any issues in UK, USA or China as all these countries have an advanced e-commerce method o establishing distribution network.

favourable

  • Market development (new market, present product)

Exporting

BBQfun will gain a competitive advantage if they export their current products to USA as the market for imported goods is not explored yet. But in China the imported goods market is well explored and by entering into that market BBQfun will get no advantage (Mayer, Melitz, & Ottaviano, 2014).

favourable

Licensing/ franchising

Obtaining trade license in China is a very long drawn and difficult process. BBQfun can obtain trade license easily in UK and USA to start their trade operations there. Franchising will also be more convenient in UK and USA but it would raise the cost for BBQfun.

unfavourable

Joint venture

The joint venture option is also available with BBQfun but coming to a consensus for both the companies will be a problem owing to their difference in culture and methods of carrying on trade (Acur, Kandemir, & Boer, 2012).

unfavourable

Direct investment

UK, USA and China are inviting foreign direct investments to their countries and so this is a favourable time for BBQfun to enter into foreign markets.

favourable

  • Diversification (new market, new product)

Related diversification

BBQfun can diverse their product portfolio according in lines with their current portfolio of products. They will have to first identify the needs, wants of the customers in the market, and then in alignment with that diversify their products range.

favourable

Unrelated diversification

Unrelated diversification can be an option for BBQfun to enter into a new market. But this will increase their cost of operations with no guaranteed return as all the investments will be made in a new market.

Unfavourable

b.The types of markets and aspects of the marketing mix by ranking each of the following elements mentioned below in terms of their viability and likely contribution to the business such as distribution, products and types of promotional activities.

Types of marketing & markets

Types of marketing

Market to serve

Considerations

Ranking(Most favourable = lowest number while least unfavourable = highest number)

  • e-commerce

USA

The e-commerce market for outdoor and lifestyle products in USA is very advanced and developed and more profitable then UK and China market. Hence, BBQfun should focus on online market in USA by either creating their own e-commerce site or by tying up with the other online websites of USA (Purkayastha, Manolova & Edelman, 2012).

1

  • business-to-business

China

For a foreign company it is difficult to enter into the Chinese markets. Hence, BBQfun can use the options of joint venture, strategic alliances or partnership to enter the Chinese market. The only drawback in this case will be that due to the cultural and trade difference, the two companies may not be able to reach a consensus (Chen, Reilly, & Lynn, 2012).

7

  • direct marketing

UK

Direct marketing is a way by which the company can advertise its products by sending emails or text messages to the customers or by distributing catalogues and websites. This way of advertising will be helpful for BBQfun in the UK market.

2

  • ideas marketing

UK

This will be more favourable in the UK market as the customers in UK are more accepting when it comes to trying new brands or products. Therefore, if BBQfun uses the correct method of advertising in the UK market and makes the consumers aware of their line of products, their sales might increase (Uhlaner, L. M, Duplat & Zhou, 2013).

4

  • public sector marketing

USA

Due to United States Free Trade Agreement between USA and Australia, the trade relations between both the countries are very good. Therefore, the USA government would help BBQfun to reach out to the local customers.

3

  • services marketing

China

Services marketing refer to both B2C and B2B services. Since entering Chinese market is difficult due to its stringent trade laws, service marketing will be beneficial in the Chinese market (Morgan, Katsikeas & Vorhies, 2012).

6

  • telemarketing

USA

The telemarketing will be most beneficial in the USA market as the people out there are easily induced into purchasing products by viewing advertisements. 

5

10.Using a suitable methodology, such as gap analysis, market or marketing analysis, or competitor analysis, identify and decide on two marketing opportunities to focus on and investigate further.

Gap analysis(analyse 4 marketing opportunities and choose two)

Strategic objective

Current standing

Deficiency

Action plan

Market penetration

It is selling more number of products in the existing markets.

BBQfun is not being able to get extra market share by market penetration.

 

Product development

It is selling new products in the existing markets.

BBQfun is not being able to innovate its products according to the needs of the market.

A proper market research will help BBQfun to understand the types of products that the market needs.

Diversification

It is selling new products in the new markets.

The diversification is increasing the cost of BBQfun, which they are not being able to meet in the new market.

 

Market development

It is selling existing products in the new market.

The existing products are not according to the new markets’ tastes and preferences.

BBQfun will need to conduct a market research of the new market  to understand the market needs and demand so that they can introduce relevant products in that segment of the market.

11.Estimate the effect of the two marketing opportunities on the business, for example:

Impact  analysis(based on 2 marketing opportunities against following factors)

Marketing opportunity

Factors for consideration

How does it affect BBQfun?

Action plan

Product development

  • Effect on sales volume

The sales volume will increase as the company’s product portfolio increase.

The company needs to maintain the sales volume.

  • Growth

Introducing new products ascertains growth the product portfolio and sales of the company.

The company needs to launch new products according to the needs of the market.

  • Market share

The market share of BBQfun will increase.

The firm has to increase its market share by attracting more consumers.

  • Profitability

With increase in sales volume, the profitability will also increase.

The profit level needs to be maintained.

  • Potential competitors

The potential competitors of BBQfun will also try to launch new products in the market.

The analysis of the competitors products and sales needs to be done.

Market development

  • Effect on sales volume

The sales figure will increase.

The company needs to attract more customers by means of advertising.

  • Growth

Emerging into new markets will ensure growth of the company.

The penetration into new market has to be done after proper market analysis.

  • Market share

The company will need to capture a share of the market in the new country.

In the new market, the market share needs to be established.

  • Profitability

In new markets, the profitability cannot be ensured in the formative years.

Profitability needs to be ensured after a few years in the new market.

  • Potential competitors

The company needs to do a proper market research about the rivals in the market.

The market research will help analysing the rivals.

6.Discuss what are the consideration of external factors (legislations including privacy act, anti-discrimination, competition and consumer act; ATO regulations and GST implications; manufacturing standards; e-commerce best practices marketing codes of practices), costs, benefits, risks and opportunities to determine the financial viability of the selected marketing opportunity.

Assessment of external factors

Types of legislation

What it is about:

How does it impact BBQfun

General Australian legislation

In Australia, only a Parliament may make legislation or authorize the making of legislation. However, because judges have the role of applying the laws of interpretation, if there is a dispute about the meaning of legislation, the judges decide the dispute.

 

They have to follow all regulations and laws laid down by the legislation.

ATO regulations

 The ATO collects income taxgoods and services tax (GST) and other federal taxes

They pay taxes accordingly.

GST implications

GST is a broad-based tax of 10% on most goods, services and other items sold or consumed in Australia (the indirect tax zone) and on most imports of goods. Exports of goods and services from Australia are generally GST-free.

This will increase expenses by 10%.

Australian standards

 Designed to ensure products, services and systems are safe, reliable and consistently perform the way they were intended to.

Bbqfun’s activities will be monitored.

e-commerce best practices

Practises that will maximise sales.

Will increase sales revenue.

Marketing Code of Practice

  • Australian Direct Marketing Association
  • Direct Marketing Code of Practice
  • Free TV Australia Commercial Television Industry Code of Practice

A set of standards of conduct for marketers to minimise the risk of breaking legislation laws and to promote a cultureof best practice.

This will protect the company.

Privacy Act 1988

This extends to the private sector currently.

Needs to provide information if public demands information.

Anti-discrimination Act

It is unlawful to discriminate on the basis of a number of protected attributes including age, disability, race, sex, intersex status, gender identity and sexual orientation.

To carry out operations without hurting public and employee sentiments.

Competition and Consumer Act

It seeks to promote competition, fair-trading as well as providing protection for consumers.

They will have to follow these norms.

7.Based on the selected marketing opportunities, identify changes to current operations in order to take advantage of the opportunity. Ensure changes identified are adequate to:

Evaluation of required change to meet current operation requirements

Marketing strategies

Factors for consideration

Changes required

Action plan

New and better packaging

  • service an increased or different customer base

Increase in production but keeping in mind not to increase production cost by a large amount such that it can’t be recovered in sales.

Advertising the product in a manner that it reaches a wider consumer base.

  • ensure continued quality of service

No such change is required if previous quality of service was satisfactory.

To continue prevalent service if favourable, or improve them.

Organic raw materials

  • service an increased or different customer base

Organic raw materials will attract a more health conscious consumer base. Hence, the target audience must be found.

Research must be done to find the new customer base.

  • ensure continued quality of service

New organic raw materials may lead to change in product quality. Improvement in the product is the most likely consequence. Therefore, no change is required.

Product must be checked to ensure same quality is maintained as before.

8.Estimate and justify resource requirements and costs for changed operations with considerations on the following areas:

Estimation of costs of resource requirements to meet changed operations

Marketing strategies

Factors for consideration

Estimated costs ($)

Justifications

Action plan

New  and better packaging

  • Additional staff

Increases by AUD 3200

For example, the company pays AUD 2 per hour to their employees. If 5 more employees have been hired in addition to the previous existing employees and they work for 40 hours a week then the company’s expense rises by AUD 3200 monthly

To try and get interns and low cost labourers to reduce cost of operation.

  • Distribution costs

 Increases by AUD 1000

The expenses associated with the process of selling and delivering goods and services to customers are:-

  1. Salaries of marketing manager, sales director and sales management AUD 200
  2. Salaries and commission of salesmen AUD 100
  3. Travelling and entertainment expenses of salesmen AUD 50
  4. Marketing costs like advertising and sales promotion expenses AUD 350
  5. Costs of running and maintaining delivery vans AUD 100
  6. Discount allowed to customers for early payment of their debts AUD 50
  7. Bad debts written off AUD 50
  8. Allowances for bad debt provision AUD 100

 

The aim is to reduce packaging cost hence the change. So less costing raw material is to be used.

  • Equipment

Increases by AUD 1000

  1. Depreciation of equipment and eventual replacement costs  AUD 200
  2. Damage due to uninsured losses, accidentsabotagenegligenceterrorism and routine wear and tearAUD 100
  3. Salaries or Wages of personnel operating machinery  AUD 300
  4. Raw materials and resources AUD 100
  5. Fuel costs such as power for operations, fuel for production AUD 100
  6. Maintenance of equipment AUD 100
  7. Insurance premiumof the machinery AUD 100

 

New equipment is required to produce new type of packaging.

  • Promotional costs

Increases by AUD 500

A change in operations leads to increased operational costs. This is because a new packaging will require new promotional activities to make customers aware. Moreover, this extra cost will also be taxable.

This will increase initially so as to make sure that customers are well aware and buy the product

  • Staff training

AUD 100

It is required to train employees so that they implement the changes in the product.

The product manager needs to train employees and make sure that they are fully aware and make no mistakes.

Organic raw materials

  • Additional staff

Increases by AUD 3200

Additional staff may is required as a new production technology will be followed. Say,the company pays AUD 2 per hour to their employees. If 5 more employees have been hired in addition to the previous existing employees and they work for 40 hours a week then the company’s expense rises by AUD 3200 monthly (Williams, 2015).

Preferably people with basic knowledge in organic raw materials should be hired.

  • Distribution costs

Increases by AUD 500

Distribution cost will rise, as organic raw material acquisition will firstly be very difficult. Secondly, to incorporate them in the production process will require new technology and hence change in production process.

To make sure that only the minimum required activities are carried out so as to reduce cost.

  • Equipment

Increases by AUD 1000

This increase in cost occurs, as the old machinery might not be able to able to work with the newly acquired raw materials.  So new and upgraded machinery needs to be bought. Cost will also increase due to future depreciation loss, unwanted tear and damage and fuel/ electricity for production, maintenance, insurance premium (Goworek, 2012).

The machinery bought should be compatible with the organic raw materials. They should also be insured and easy to operate.

  • Promotional costs

Increases by AUD 100

Since a an improved product has been launched, additional  promotion needs to be done to  make customers aware.

Maximum promotion should be done so that everyone knows that the product has become better and hence this will eventually increase sales.

  • Staff training

Increases by AUD 100

Additional cost is incurred since there might be a change in technology with respect to production. The staff needs to be trained according to the new techniques and methods and made aware what changes have occurred.

To make sure each and every employee knows what the new product entails.

9.Provide an assessment report on the viability of each opportunity by:

a.Exploring and developing entrepreneurial, innovative or creative options (one for each opportunity) to apply the marketing opportunities in the context of the organisation (For example, if you identify an e-commerce opportunity, determine how to apply the e-commerce opportunity to the organisation including aspects such as media, web-design to appeal to target markets, integration with existing operations, marketing strategy and overall strategic directions)

Viability of marketing strategies

Marketing strategies

Cost factors for consideration

Plausible risks

Potential benefits

Profitability

New  and better packaging

  • Reconfiguration

Cost will increase initially but overall cost in the long run might reduce due to increase in demand of new product.

The new packaging may not be attractive to consumers and hence sales may drop. For example with Tropicana in 2009 when they changed their product design it backfired and their sales dropped by 20% and they lost millions of dollars.

A new packaging will attract new customers as well as the existing client base. This will increase sales.

Change in packaging helps brands to stay relevant.

This decision to re-package can go in two directions:

1. Either increase in sales due to increase in visual appeal or viability

2. Losses as sometimes consumers may not like a change since they get too attached to the product or the change was not a good one and hence not very appealing (Sivasubramaniam, Liebowitz, & Lackman, 2012).

 

  • Lease

The new machinery might be too costly to buy and hence has been taken on lease.

The packaging might be discontinued midway due to unforeseeable reasons but lease money will have to be paid till contract is signed.

If machinery is taken on lease then it does not need to be changed or disposed off if there is a change in production process.

Lease contract may be terminated upon requirement

  • Plant  & equipment

Cost will increase as new machinery might be required to produce the new packaging materials.

The new machinery might not be affordable. Insurance premium might also be too much.

New machinery might actually reduce overall production costs due to new technology being used.

They may be used in other production processes.

Organic raw materials

  • Reconfiguration

Cost of product and production process may increase to compensate for the resources required to acquire organic materials.

Since organic materials are naturally produced and cannot be duplicated, they cannot be bought in bulk and hence may cause delay in production. They may also be difficult to acquire. They may be seasonally available.

 

The product quality will improve since natural products are being used. This might appeal to a new and healthier consumer base.

In this new age where people are becoming more aware of benefits of using organic products, sales might increase. However, due to increase in product cost, some existing customers might drop out too (Balta-Ozkan, Boteler & Amerighi, 2014).

  • Lease

Machinery on lease

Only certain machines will be able to produce them hence the acquisition of them will also increase cost.

They can be used in further production process.

It is better to take machinery on lease while producing with these materials as it’s availability is uncertain.

  • Plant  & equipment

Special machinery is required to produce with the new materials.

If the machinery is purchased and then production is stopped midway due to say drop in sales or unavailability of organic raw materials, then this machine will be useless.

Having a machine of your own will make production process smoother and also it’s purchase is a onetime investment.

It might not be profitable to purchase new machinery since an extra cost is already being incurred to acquire the organic materials.

b.Identify and document changes needed to current operations to take advantage of viable marketing opportunities (in terms of inventory and stock, office space and software usage).

Marketing Report for BBQfun

 

Prepared by:

Executive Summary

I have analysed BBQfun products and found out marketing strategies for them to improve. I have also found potential new markets in USA, UK, and China. I have also analysed the marketing budget.

 

 

 

Situational Analysis

 

 

 

 

BBQfun is witnessing a surge in its sales and hopes to achieve its sales target of 11 million dollars in 2016. It even wants to penetrate into newer territories, which will ultimately lead to improvement in their trade operations.

 

 

 

 

 

Marketing objectives

 

 

The company will want to enter new markets by providing them with products that suits the needs of the new market. It even wants to achieve its sales target and increase its sales volume.

 

 

 

 

 

Marketing Strategies

BBQfun should choose product and market development as their aims. They should also use updated technology as per the current market trend as their marketing strategies.

 

 

 

 

Marketing Mix

 

 

 

 

BBQfun should provide products according to the tastes and preferences of the customers.

Prices should be competitive in nature as per the average market prices.

Place of operation selected should be such so as to gain maximum profit

Promotion should be done to reach maximum customers.

 

 

 

 

 

Marketing Tactics

 

Optimal customer target to be met. To study the competition. Price to be determined after studying the market and to make sure it will recover more than the production cost so as to gain profit. To make maximum impact through advertising.

 

 

 

Marketing Budget

 

Type of cost

Amount

Raw Material cost

$300,000

Fixed Cost

$50,000

Promotional Cost

$30,000

Expansion Cost

$433,000

Other Variable Costs

$58,000

 

 

 

 

Monitor & Review of KPIs

 

 

 

Sales revenue has increased due to changes brought about. Customer base has increased. Overall satisfaction with product has also increased.

 

 

 

 

Other Considerations

To reach a younger consumer base e-commerce websites can be used to sell products. PayPal or net banking facilities should be provided.

Transit advertising should be done

 

 

 

`

Conclusion

The new marketing strategy seems like a good and viable option and can be considered. The expansion in market will lead to increase in sales revenue and job creation. Moreover it will also expand the company if they want to tie up with indigenous companies in these new markets.

 

 

Reference list:

Books:

Baker, M. J. (2014). Marketing strategy and management. Palgrave Macmillan.

Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2012). Marketing: an introduction. Pearson Prentice-Hall, London.

Solomon, M. R. (2014). Consumer behavior: Buying, having, and being (Vol. 10). Engelwood Cliffs, NJ: Prentice Hall.

Fifield, P. (2012). Marketing strategy. Routledge.

Shankar, V., Carpenter, G. S., & Farley, J. (Eds.). (2012). Handbook of marketing strategy. Edward Elgar Publishing.

Journals:

Lauer, J. A. MUSTANG DAILY.

Leonidou, L. C., Leonidou, C. N., Fotiadis, T. A., & Zeriti, A. (2013). Resources and capabilities as drivers of hotel environmental marketing strategy: Implications for competitive advantage and performance. Tourism Management, 35, 94-110.

Morgan, N. A., Katsikeas, C. S., & Vorhies, D. W. (2012). Export marketing strategy implementation, export marketing capabilities, and export venture performance. Journal of the Academy of Marketing Science, 40(2), 271-289.

Kumar, V., Bhaskaran, V., Mirchandani, R., & Shah, M. (2013). Practice prize winner—creating a measurable social media marketing strategy: increasing the value and ROI of intangibles and tangibles for hokey pokey. Marketing Science, 32(2), 194-212.

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Sivasubramaniam, N., Liebowitz, S. J., & Lackman, C. L. (2012). Determinants of New Product Development Team Performance: A Meta?analytic Review. Journal of Product Innovation Management, 29(5), 803-820.

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Goworek, H., Fisher, T., Cooper, T., Woodward, S., & Hiller, A. (2012). The sustainable clothing market: an evaluation of potential strategies for UK retailers. International Journal of Retail & Distribution Management, 40(12), 935-955.

Morgan, N. A., Katsikeas, C. S., & Vorhies, D. W. (2012). Export marketing strategy implementation, export marketing capabilities, and export venture performance. Journal of the Academy of Marketing Science, 40(2), 271-289.

Uhlaner, L. M., van Stel, A., Duplat, V., & Zhou, H. (2013). Disentangling the effects of organizational capabilities, innovation and firm size on SME sales growth. Small Business Economics, 41(3), 581-607.

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Acur, N., Kandemir, D., & Boer, H. (2012). Strategic alignment and new product development: Drivers and performance effects. Journal of Product Innovation Management, 29(2), 304-318.

Mayer, T., Melitz, M. J., & Ottaviano, G. I. (2014). Market size, competition, and the product mix of exporters. The American Economic Review, 104(2), 495-536.

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