Marketing Plan for an Updated Product

Marketing Plan for an Updated Product A marketing plan is typically designed to establish a framework for management to use as they pursue the marketing and sales objectives. It should be built on the results of the market research and the specific value proposition of a product or service. In general, a marketing plan is a shorter form of a business plan that has a limited scope and marketing emphasis. I have chosen UK chocolate confectionary market to present a market plan for an updated product. Market Overview: Chocolate sales in Europe have been growing steadily. The UK confectionery market achieved year-on-year growth for the last five to six years to reach a value of  £4.53bn i.e. the sales have increased by 13%. The overall European chocolate sales increased by 15% and the United Kingdom itself accounts for nearly 30% of European chocolate consumption. Product Overview: So far the need for innovation and the product development techniques has been explained. On the basis of these discussions I would like to use the opportunity to develop a new product in the confectionary market. Taking the existing products of Cadbury such as Cadbury Picnic, Cadbury Crunchie and Boost chocolate bars as well as Cadbury Crà ¨me Eggs, I have thought of updating Cadbury chocolate bars by producing a new chocolate bar and the Crà ¨me Eggs by producing another egg shaped product. The analysis of innovation need suggests that launch of new product can help Cadbury to attract more customers and thus increase market share in a highly competitive market of chocolate confectionary. Assuming the results obtained from the techniques for new product development and analyzing the market overview, I would say that a new product can be launched in the market and thats why I have thought of updating Cadburys existing products into other new products. This Cadburys new chocolate bar will be known as CADBURY LEMON BAR and the new egg shaped product will be known as CADBURY CHOCOLATE LEMONS. The bar name has been selected because this chocolate bar will be having an internal layer of sweet lemon tart and externally it will be covered with a mix of chocolate and fine grains of peanuts. N.B: (In the report the word Cadbury Lemon means both the updated products i.e. Cadbury Lemon Bar and Cadbury Chocolate Lemons). Market Segmentation: Understanding the needs and desires of consumers creates the opportunity for new products to be developed and brought to the market, meeting these needs and generating incremental sales. Chocolate confectionary is a mass market attracting customers and consumers of almost every age group and gender, but those who like eating chocolate. The target market for both the Cadbury Lemon products can include children of age 5 to 13 years in terms of consumers and the parents to pay for the product in terms of customers. Further more it can be expanded from children of age 14 to young people and then onwards to aged people (65+) as long as they keep their interest in their chocolate eating habit. The product would also be suitable for vegetarians and further more it would be excluded of any religious issues such as alcohol free etc. In terms of income and price of the product there isnt any need to be selective to choose a particular group of audience as everybody can easily afford to buy a b ar of chocolate or a pack of chocolate sweets i.e. Cadbury Lemon Bar and Cadbury Chocolate Lemons. Snacking Today: Snacking today is the second largest segment in the UK confectionary market with a share of over 28%. Cadbury Lemon chocolate bar is such a product which is mainly bought for immediate personal consumption. The target market of this product would be people who will buy a chocolate bar and eat it. It does not identify any particular segment but includes everybody having an access to the stores and retail shops where they will find the product, buy it and consume it. For Home: The products in this category are those which are bought for consumption sometime later. Thus in this category both the products i.e. Cadbury Lemon Bar and Cadbury Chocolate Lemons will fit properly in this category of products. These two products would target people who like filling their cupboards with chocolate to consume them for different purposes e.g. filling lunch boxes or as a treat after evening meals. For home is a category which is more about the products to be eaten by the customers i.e. both male and female partners, their children and parents and as well as by other consumers such as visitors or guests visiting at different times e.g. evening tea time and so on. Sharing Occasions: This segment represents an emerging trend towards the sharing of confectionary at formal occasions. This is an emerging segment for products which are traditionally packed in larger pack formats such as tins, large boxes and cartons. They are purchased not as gifts but also for informal sharing on specific occasions e.g. the Cadbury Chocolate Lemons can be purchased as a gift for someones birthday and Cadbury Lemon Bar can act as a sharing product at a party or just at small gathering of friends. This is how another segment of the market can be differentiated. Seasonal Giving: Seasonal giving is the third largest segment of the overall confectionary market. The rate of growth of this segment has led to an increase of 3.8% in sales and an increased share of the overall confectionary market as 17.6%.This segment includes products bought to give to someone else as well as a larger number of seasonal lines and Cadbury Chocolate Lemons in different packs would best fit in this category. Seasonal confectionary is mainly sold during the run up to Christmas and Easter and is a traditional gift at these times of the year. Along with this other seasonal occasions can include Halloween, Mothers Day and Valentines Day. Competition Overview: The UK confectionary market is facing a very strong competition among the companies in this market. Thus Cadbury Lemon will also have to tackle such circumstances of competition from different major competitors including Nestle, Kit Kat, Mars, Maltesers and others. Moreover, rapid product growth at the mass end and the premium end of the European chocolate market is adding competitive pressures. Smaller companies are making chocolate products for niche markets, such as chocolates for people who want to avoid dairy products, chocolates for people who are diabetic and chocolates for people who prefer natural or organic flavourings and ingredients. Further, established companies are constantly introducing variations and other favourites to satisfy customers variety-seeking behaviour and encourage loyalty. Although Cadbury owns a good market share but still there is a need to be aware of the competitors and the situations which may cause hindrances for the new product. SWOT Analysis: Cadbury has been in the confectionary business for a long time and holds a strong market share. Thus the company has been using its strengths to always go for producing new products as well as updating the existing ones. National advertising and sales promotion support sales of Cadbury and for instance, Cadbury has been spending heavily to launch new chocolate products or building sales during Easter or other holiday periods. There might also be some weaknesses that could be associated with it. Most of the people see chocolates as an affordable luxury and therefore buy such products for themselves and also for gifts. People are adopting the habits of giving chocolate as gifts on different occasions like Christmas, Valentines Day and Birthdays etc which has increased the opportunities in terms of increase in demand for the product. However the threats are always there when a company launches a new product. In addition to the major luxury chocolate makers with established brands, natio nal advertising campaigns and sizable market share, many smaller and local chocolate makers are attracting loyal customers. But on the whole, so far, the UK confectionary market for Cadbury seems to be having the opportunities to grow and increase the market share. Goals and Objectives: For this marketing plan I would say that the goals and objectives are simply the facts describing where the company i.e. Cadbury wants to be. The goals and objectives can be divided into two parts. Sales Goals: For many organizations the ultimate goal of the marketing plan is the effect it will have on the bottom line. Sales goals would be in terms of the sales figures estimated to be achieved. Until 2005, Cadbury has been earning great sums of profits and the further need is to increase the profits or maintain the profitability of the company up to a level at least meeting the required levels. Marketing and other Objectives: The marketing objectives for Cadbury Lemon should address each group in the target market in terms of meeting customer satisfaction and their interests in buying the product. The market objectives for Cadbury Lemon should fulfill the same elements as set for other brands. It includes continuing high Corporate and Social Responsibility standards through actions and brands, delivering superior shareowner performance, ensuring the capabilities are best in the market, focusing on creating a cohesive and talented workforce through encouraging inclusiveness and increasing the diversity of our people. Hence the product would only be said to be successful if these goals and objectives would be clearly identified and followed properly. Pricing Strategies for Cadbury Lemon: Pricing in general meanings means how much to charge for a product or service? Pricing is one of the four Ps of the marketing mix. The other three aspects are Product Management, Place (distribution) and Promotion. Penetration Pricing: Penetration pricing is the pricing technique of setting a relatively low initial entry price, a price that is often lower than the eventual market price. The expectation is that the initial low price will secure market acceptance by breaking down existing brand loyalties. Penetration pricing is most commonly associated with a marketing objective of increasing market share or sales volume, rather than short term profit maximisation. Competitive Pricing: The competitive pricing strategy is used by around a quarter (27%) of organisations. It is the most usual form of pricing which is based on evidence from the market where product prices are determined by reference to the prices of competitive products. A sound appreciation of competitive actions, especially prices, is necessary for the most effective strategies to be formulated. The most effective marketing manager will, however, try to develop an understanding of the various competitive positions based on an appreciation of the customer needs. Distribution: Like Pricing, distribution is another important part of marketing mix which needs businesses to carry out detailed analyses in order to distribute their products/services easily and efficiently to their customers. A distribution business is the middleman between the manufacturer and customer.. As far as distribution of confectionary products is concerned, the best and appropriate options would be the following. (Method 1) (Method 2) Producer Producers Retailers Whole Sellers Customers Retailers Customers Communication: For Cadburys updated products i.e. Cadbury Lemon Bar and Cadbury Chocolate Lemons I would like to recommend following communication techniques for the product promotion. TV Advertising: Importantly I would like to recommend using TV as the most appropriate tool of communication. Cadbury has already been sponsoring Coronation Street for a long time. So when people will be watching the programme then in every break the advert will be presented and people will see how the new product has been developed. This technique will pass the message to the right target market and thus will create awareness among public. Bill Boards: Bill boards are though to be another important tool of sending the message across the target market and overall to every one. Bill boards will be displayed at certain points which will clearly explain what the product looks like and how has it been developed. People while traveling will get attracted towards the product being displayed on bill boards and thus will get the message. Hence hopefully this technique is thought to be equally appropriate to create awareness among public and then leading them to further stages of decision making and purchase of product. Transport: Compared to bill boards, transport will be taken as a source of moving message across people. Thus this is another technique which holds an equal importance as TV advertising and bill boards. Transport including buses, trams, trains and to some extent taxis are thought to be quite suitable for making people aware of the product. The product will be displayed with its features and it differences from other products on the above mentioned transports. People when traveling on these transports or following them, will get attracted towards the printed message. So this is how it will help Cadbury to increase their profits when the sales will go up. Sales Promotions: One of the below the line techniques that I think would help to increase sales is sales promotion. It can be done in a way that Cadbury can encourage customers to buy Cadbury Lemon by offering the products at trial prices or another way could be that first few millions of products would be given free without any charges. Similarly when the products would be sold through a third party e.g. retailers then it can also be looked t providing point of sale material, or special promotions aimed at encourage the distributors to sell or stock more products, so that it can help to increase the amount people will use our product. Monitoring and Reviewing Marketing Performance: The organisations who manage to be both efficient in their operations and effective that they deliver what their customers want, they enjoy the benefits of their business in real sense. On the other hand those who are neither efficient nor effective lose their market share and at last come out of the business. Financial Measures: Profit: Most of traditional financial measures concentrate on profit and it goes without saying that profit is essential to the long-term survival of any business no matter what size or shape. The performance of Cadbury Lemon could easily be judged by analysing the difference in the profits of the company. If the companys profits have gone up then it can be assumed that the product has been successful in the market and that it has helped to meet the companys objectives in terms of achieving the target profit. Meeting the financial targets is very important for every business. Companies invest a lot of money in carrying out Research and Development to make their products effective and efficient in the market. So a successful launch of Cadbury Lemon and the analysis of profit would clearly help Cadbury to make decisions about whether the product should be kept in market and let it become a cash cow or pull it out before it becomes dog. Return on Sales: Another area that gives good and bad signals to the businesses about their performance is sales. Return on sales can tell how well a product or service is performing in the market. This is how Cadbury Lemons sales will help to see what the demand for the product is. This can be analysed, whether the consumers have liked the idea of developed product and are doing repeat purchases or the product have failed to satisfy customers needs. Thus higher the sale levels will be greater would be the customers satisfaction, which will result an increase in Cadburys market share. Now lets have a look how non-financial measures can take part in reviewing Cadbury Lemons performance. Barriers to Marketing Planning: In order to overcome any problem the first and important requirement is appropriate monitoring of the problem and see how easily and effectively can a business overcome a barrier. As long as the proper control measures are installed there will be no more problems that can interfere. Taking a look on previously described external barriers; organisations are needed to take complete analyses of the factors that could influence their strategic implementation process. The political as well as legal factors especially Government policies related to taxation, employment, health and safety and other issues can be influential for the organisations. So for organisations, it is necessary to keep in mind the Governments rules and regulations in order to take step in any part of business strategy. Accordingly it would be important for managers to detect changes early so as to respond effectively. Similarly an early forecast of economic factors is also important so that recommendations related to future can be made. Technological barriers to some extent could be considered as slow acting barriers because technology does not change everyday. However for Research and Development purposes technology plays a vital role in giving the information to businesses that, then, is to be used for developments processes. The internal marketing, being an integral part of successful strategic implementation, involves all the processes necessary to carry the message of the strategic plan inside to the various audiences that compromise the organisation. The internal marketing is equally important as that of external marketing and thus it needs to be analysed fully in order to eliminate errors. Like external marketing, internal marketing also requires a good and appropriate understanding of the needs and motivations of the target audiences to be successful. The organisations should be designed in such a way that the communication between top and the bottom layers is quick and detailed. Keeping everyone informed about any changes going on within an organisation can help to take ideas and views from internal bodies which could then further be utilised in the process of final decision making. In order to analyse that how well a marketer is performing, the information can be obtained with the help of a marketing feedback. Although the information and feedback on a plans progress is can never be 100% accurate but it does act to both reduce the uncertainty in planning and improves the quality of action. Conclusion: Hence in this report the need for innovation for organisations has been explained. Product development techniques have been discussed in detail with reference to the confectionary market. A marketing plan has been presented which is covering all the aspects related to market review, competition, pricing, distribution and communication. The measures to review performance have also been talked about. And finally the barriers and the suggestions to overcome these barriers have also been explained in detail.