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Executive Summary
Described as ‘America’s Favorite Sponge’, the innovative sponge has seen on ABC’s popular TV show, Shark Tank is now on its way to becoming a household brand name. The multipurpose high-tech polymer microfiber sponge is made to change cleaning experiences at home. The company behind this product was found in 2008 by Aaron Krause, but today boasts of one the Shark Tank investors, Lori Greiner, as an investor.
The product is soft in warm water but becomes hard in cold water to enhance the cleaning of surfaces. Moreover, it does not harbor bacteria or emits foul smell relative to other available brands.
The market is dominated by some prominent brands, such as P&G, Scotch-Brite, and other small producers who have already acquired significant market shares. Notably, Scrub Daddy has a superior sponge but lacks consumer awareness. Scrub Daddy has not sufficiently used cheaper promotional tools, such as social media, and the Internet to develop the brand.
It is therefore suggested that Scrub Daddy should focus on creating brand awareness nationwide. On this note, the use of promotional tools, such as billboards, television, radio, social media, and the Internet will help the company to increase brand awareness.
Introduction
Scrub Daddy was founded in 2008 by an entrepreneur, Aaron Krause. Scrub Daddy is one of the most successful products ever shown on the reality TV show, Shark Tank. The patented superior sponge is an incredibly adaptable cleaning apparatus for the kitchen and other areas in the house. The highly developed polymer constituent of the Scrub Daddy has been cut into a beaming face shape and adapted for simple cleaning processes. Flex Texture implies that the surface of the sponge will change based on the water temperature (Scrub Daddy, Inc para. 1). That is, in hot water, the sponge will be delicately tender for cleaning while in cold water for rougher surfaces, it will be rougher for scouring texture. Scrub Daddy cleans well to ensure that it does not retain any particles as other conventional sponges do. This marketing plan strives to make Scrub Daddy to be promoted, marketed, and sold like other common cleaning products in the US. Also, this marketing plan will reposition the product as modern, versatile, easy to use, and highly effective through creating an advertising campaign to reach the intended consumers. The ultimate goal of this marketing plan is to increase brand awareness among consumers by 50% within one year.
Market Environment (Micro & Macro Factors)
In this section, the focus is on environmental factors that are relevant, their influences on both the current and future marketing efforts, and possible changes. For microenvironment, competition, suppliers, intermediaries, and the public are evaluated (Armstrong, Adam, and Denize)
Competition
Scrub Daddy faces intense competition from some of the most established brands in the US cleaning industry.
Scotch-Brite
This product consists of two-dozen microfiber sponges, which are suitable for simple cleaning. They quickly dry and powerfully absorb water (up to 50% more than ordinary cotton dishcloths). These are qualities, which make the product an effective sponge for regular cleaning activities in a busy environment. Also, these products are convenient because they can be washed using a machine. Scotch-Brite Microfiber may come with 12 or 24 pieces, usually at discounted prices, for example, Walmart sells the product at $39.46 from the previous price of $55.99, which means shoppers save a substantial amount from this product. It is widely used in the kitchen on all surfaces. The material is derived from microfiber. This product is widely available in the US in both traditional brick-and-mortar stores and online stores like Amazon.com and eBay with free shipping
Dawn Flip-It Sponge – 2 CT
This sponge is specifically designed for non-stick cookware, dishes, glasses, pots, pans, and bakeware. The product is best when used with dawn dishwashing liquid. Dawn Flit-It Sponge is a registered trademark of the Procter & Gamble Company. The product only costs $5.95 in different stores and is found in various pack sizes. Free shipping is also available for customers.
Other Products
Other products are also available in the market. Consumers can opt for Rubbermaid Microfiber Cleaning cloths, multipurpose microfiber cloths, Impact products microfiber cleaning cloths, MU kitchen microfiber dish towel, clean slate dry-erase erase microfiber cloth, Carlisle sanitary maintenance microfiber products, and other generic products not mentioned here. The price range for this product is as low as $10.75 and higher as $70.32.
Most of the above-mentioned brands are well recognized in US households. They are well distributed through larger online retailers like eBay and Amazon.com. Moreover, consumers also enjoy discounts and free shipping. The country of origin of these products is indicated as the US, which means that consumers can trust their quality while suppliers and any intermediaries are considered locals.
Scrub Daddy costs about $4.68. Although it is relatively affordable compared to the above-mentioned competing products, Scrub Daddy has not penetrated the market, and many customers are yet to know where to purchase the product. According to Aaron Krause, some sponges suffer from image problems because they stink, hold bacteria, and so gross (Hagerty para. 1).
For the macro environment, market factors related to demographic, economic, technological, and political forces are explored.
Demographics
Scrub Daddy must recognize some important demographic changes in the US. According to Pew research demographics, the American middle class is shrinking (Badger and Ingraham para. 1). In most instances, economic booms have been associated with the rising middle class. Nationally, it has been observed that the percentage of adults in the upper-income segment increased from 17 percent in 2000 to 20 percent in 2014, an increment of three percentage points. At the same time, the number of people in the lower-income segment increased from 28 percent to 29 percent, an increment of one percentage point, which reflects a net gain for the lower tier. However, the net gain in economic status differed greatly across cities (Badger and Ingraham para. 1). It is observed that there is a likelihood that the shrinking of the American middle class could reflect a shift into either the lower-income segment or the upper-income segment. These data are extremely for Scrub Daddy in product pricing strategies.
Meanwhile, women are more likely than men to purchase Scrub Daddy because they are most engaged in cleaning. Working mothers are most likely to have the highest rate of purchasing the product because of the convenience it offers. Additionally, it is women who influence purchasing decisions in most families. Both men and women aged between 35-54-year-olds are most likely to use this product.
The State of Technology
Scrub Daddy is a technology-driven firm. Some technological applications, such as 3D design, 3D printers, product engineering, and design, and accelerated prototyping have led to more product development. The company is now prototyping accessory holders, mops, personal care products, and holders (Spring para. 3-5). For instance, recently launched Scrub Daisy and Screen Daddy – a wand set of products. Technology has assisted Scrub Daddy to cut costs and time (80% because of 3D printing) drastically for developing new products. Engineers can only take a single day to simply printing, evaluating, altering and reprinting concepts as opposed to talking about them with a molder and after that waiting for months for a model that winds up not working. Technology now allows companies like Scrub Daddy to possess the capacity to test ideas in hours and each new print provides superior results. Additionally, the 3D printing creativity at modern firms stretches out beyond cost and time saving during product designs. By relying on modern technologies, Scrub Daddy, for example, has launched more than nine new items in five years because of the proficient, the cost-effectiveness of 3D printing. Through such quickened developments, modern companies are quickly gaining market shares and becoming an everyday brand in households (Spring para. 3).
The growth of online networking and social media offer novel opportunities for small businesses to grow. Traditional forms of advertising and promotions are critical for small businesses, but they have their limitations, such as costs. The utilization of social networking sites permits a more broad reach to the intended interest groups. Likewise, technologies that permit online sales, order placement, payment, and deliveries have actually given businesses edge.
Politics
The US political environment for businesses is extremely stable. However, the recent political rhetoric from President Donald Trump has attracted the attention of small business owners, specifically on regulations and taxes. Concerning regulations, Trump said that nearly 70 percent of government measures were superfluous and could be abandoned. Apart from the Affordable Care Act, Trump also rejected the strict Dodd-Frank Act enacted following the financial crisis of 2008. Trump has already expressed that he might want to eliminate these measures.
This would likewise mean canceling the Consumer Financial Protection Bureau, which originated because of the Dodd-Frank enactment. The agency has implemented a series of measures that strive to fix lending requirements and spell harsher penalties for unsafe lending practices. In a few instances, these changes have made it difficult for banks, especially smaller banks – to loan to small business entrepreneurs on account of thorough risk examination and higher standards for business people to meet to get a confirmation for a credit (Mandelbaum para. 2-3).
Some reports indicate that small businesses incur substantial costs related to taxes. Entrepreneurs may realize reduced tax charges under the Trump administration. During his campaign, Trump guaranteed to review the tax duty code for organizations and people by lowering the number of minimal tax limits. Under this proposed arrangement, Trump would decrease the number of personal tax brackets from seven to three at rates of 12, 25, and 33 percent relying upon an individual’s salary level. At present, the highest marginal tax rate is 39.6%. Trump has likewise proposed initiating one corporate tax rate of 15 percent for all organizations, which is lower by 20% when compared with the present rate of 35 percent (Abrams para. 4).
Trump’s arrangement would provide a one-time repatriation tax of 10% for organizations that are holding benefits offshore in trying to decrease their taxation rate. The President had previously proposed take out the death tax duty and tax capital gains held until death and notably, small companies and family farms would be excluded from this duty.
From the above observation, it is evident that small businesses like Scrub Daddy are most likely to benefit in terms of tax reforms and regulations. One should not however be optimistic because these were campaign pledges, and they require house approvals if at all they are followed. Hence, at the moment, it is not clear how Trump administration would influence the business environment for small businesses.
Situation Analysis – SWOT
Strengths
Strengths are unique capabilities or factors that give Scrub Daddy a superior competitive advantage or ensure that it can meet higher customer needs, and they are typically long-term, internal factors, such as capabilities to develop multipurpose microfiber that changes based on the temperature of the water.
Weaknesses
Weaknesses are the lack of capabilities or factors that hinder Scrub Daddy from attaining superior competitive edge or meet specific customer needs, and they are typically long-term, internal factors impeding the growth of the company. In this case, Scrub Daddy has not been able to penetrate the market using different channels faster.
Opportunities
Opportunities are factors or trends that give Scrub Daddy capabilities of attaining further success. Opportunities are generally short-term and long-term, external factors, such as developing new products, sponsorship, and global distribution channels (Centurion Strategies para. 3).
Threats
Threats are factors or trends that hinder Scrub Daddy from attaining further success, and they are generally short-term and long-term external factors, such as competition from P&G and other alternative cheap sponges in the market.
Objectives and Issues
The main priority issues are the company’s prioritized strengths to be leveraged, weaknesses to be addressed, opportunities to be exploited, and threats to be curtailed or negated. As such, one major issue that Scrub Daddy experiences are the lack of brand awareness. As such, the plan is to reposition to the brand as unique modern and easy to use the product. This marketing plan strives to make Scrub Daddy to be promoted, marketed, and sold like other common cleaning products in the US. Also, this marketing plan will reposition the product as modern, versatile, easy to use, and highly effective through creating an advertisement campaign for the intended audience.
The main objective of this marketing plan is to increase brand awareness among consumers by 50% within one year.
Marketing Strategy
Key messages are directed to all of the target consumers for Scrub Daddy products. They are simple, straightforward statements of which all audiences will understand.
Scrub Daddy is the modern, versatile, easy to use, and highly effective multipurpose microfiber sponge
Positioning
This marketing strategy to reposition Scrub Daddy and ensure it is promoted, marketed, and sold like other common cleaning products in the US. Besides, this marketing plan will reposition the product as modern, versatile, easy to use, and highly effective through creating an advertisement campaign for the intended consumers.
The main objective of this marketing plan is to increase brand awareness among consumers by 50% within one year.
Marketing Research
Primary Research
Quantitative research for Scrub Daddy would be conducted through a survey. The survey is most likely to be distributed online to working mothers across the US.
Research Objectives
- To identify working mothers’ preferred methods of household cleaning
- To determine the level of brand awareness among working mothers
- To discover why or why not they buy Scrub Daddy products
Through the above-mentioned research objectives, it will be possible to determine working mothers are most likely to utilize Scrub Daddy products. The research will also demonstrate the demographics of consumers who are most likely to use the other products offered by Scrub Daddy. Additionally, it will also be possible to determine competitors of Scrub Daddy across the US.
As a small business, Scrub Daddy requires support and, thus, it would be important to determine who is most likely to support or partner with the company. Finally, this survey will also help the company to determine the media in which people look for information about cleaning products and determine what consumers want or expect from cleaning products.
Targeted Customers (STP)
Primary Audience
The primary audience consists of working mothers, single people, and college students to ensure that Scrub Daddy can expand its market reach. From the shifts in demographic trends in the US as seen above, Scrub Daddy will target all tiers, including lower, middle, and upper.
- Women aged 35-60
- High School diploma or higher
- Employed
- Married or single
- Household income $35,000 or more
- Geographic – nationwide
Younger Audience
- Men and women aged 18-34
- Some high school or higher education
- Married or unmarried
- Children or no children
- Personal income of $34,000 or less
- Geographic – nationwide
Psychographic
- Love cleaning around the house
- Love clean kitchen
- Do not have a dishwasher
- Hate odor and bacteria
4Ps
In a market where consumer attention is difficult to get, the approach lies in the 4Ps of marketing (product, place, promotion, and price) (Woelfel para. 1).
Pricing Strategy
It appears that Scrub Daddy products are priced with the consumer in mind. The company has some of the most superior sponges globally, but it is not focused on applying premium prices to attract high-end customers, nor is it striving for cheap prices to sell more volumes. Instead, Scrub Daddy has adopted a value pricing strategy to ensure that customers feel comfortable buying its superior microfiber sponges. The pricing strategy would leave of all shoppers contented with their purchases. Thus, a competitive price offering would provide a good value against its competition (Spann, Fischer and Tellis 235).
Product Strategy
Scrub Daddy currently offers a wide range of high-quality products, the original Scrub Daddy, Big Daddy, Eraser Daddy, and Screen Daddy among others – all bear the company logo of the ‘smiling face’. The firm has carefully named nearly all its products ‘Daddy or Mummy, and lately ‘Daisy’ to ensure that they stick in the minds of customers. In the next five years, Scrub Daddy intends to introduce more product lines, including mops.
Place or Distribution Strategy
At present, Scrub Daddy distribution channels have not effectively reached all the intended customers nationally. The products can be found both on the Web and in retail stores, such as Walmart, Amazon.com, The Home Depot, Do It Best, Giant, Bed Bath & Beyond, CVS Pharmacy, Target, and Ace Hardware among others. So far, Scrub Daddy has not been distributed through other small retailers serving the lower class or other high-end stores. Besides, these major retailers have limited reach in cities where they are found. The lack of brand awareness is not doing any good for the company.
Over the next few years, Scrub Daddy should seek to increase distribution to retail specialty shops nationwide. The company should determine the most suitable outlets other than major retailers. In addition, Scrub Daddy should expand online presence and sales by using other channels apart from platforms offered by the same stores currently carrying its product line. In fact, the company should launch its own Internet kiosks at some of the more frequented and profitable retail outlets countrywide. Notwithstanding the expansion plans, Scrub Daddy should carefully observe and maintain strong ties with distribution channels available (Tănase 28).
Promotional Strategy
Notably, Scrub Daddy gained significant exposure following the reality TV show and partnership with Lori Greiner. Today, the company has informed its products on the Internet. Direct visits to various stores by key investors like Lori Greiner have also promoted the brand. The personal promotion aims to differentiate it’s Scrub Daddy superior sponges from those of its competitors. Personal contacts have been heavily used to secure space for products in their stores. This personal contact helps deliver the Scrub Daddy’s message, show the product line unique attributes, and build stronger relationships.
Sales promotions, discounts, and public relations have been heavily adopted as promotional strategies, but their impacts are limited (Lowe 496). The company should consider nontraditional marketing techniques that need little cash, but much creativity to promote the products online. Scrub Daddy is a small, flexible firm and, therefore, it can fast and easily execute such promotional strategies.
Action Programs
The omnichannel approach is recommended for the company (Piotrowicz and Cuthbertson 5; Fabio 23).
Out-of-home promotions
- Billboard campaigns along the major roads and city spaces with clear messages about the superior cleaning sponges from Scrub Daddy
Radio
Radio promotions with a distinct script to target audience. Some of the radio channels for consideration may include:
- Spotify
- iHeart Radio
- Pandora
Television
- The company should consider Netflix and Hulu for online television streaming to create brand awareness. These Web sites have wide coverage nationally and even globally.
- Additionally, TV ads should also appear perhaps in the morning and late-night when majorities watch.
Social Media
- YouTube can offer online streaming videos
- Facebook will provide a platform for the global audience where friends will tell friends
- Instagram sweepstakes should allow users to win Scrub Daddy merchandise, including t-shirts, coupons, and even a free supply for a given period
- The company should launch an App to support games with opportunities to win coupons (Thurner para. 1)
Internet
- Scrub Daddy should launch a more appealing Internet promotion for the target audience. The page should be clean, more organized, and easy to navigate. Here, users can explore the Shark Tank presentation, YouTube promotions, and other commercial materials available for presentation.
Budget
These figures are tentative and, therefore, it is important to determine the actual costs from service providers.
Controls
Scrub Daddy anticipates sustained operations into the likely future. It, therefore, expects more fierce competition, tighter budgets, intense campaigns from rivals. As such, Scrub Daddy will continuously monitor all promotional channels and review impacts within six months to determine specific ones with massive impacts and invest accordingly. It will focus on sales data, clicks, customer feedback, and other relevant information. The company will also adopt Google Analytics to track online promotional activities.
Works Cited
Abrams, Rhonda. “4 Steps to Trump-proof Your Small Business.” USA Today, 18 Jan. 2017, p. 1.
Armstrong, Gary, et al. Principles of Marketing. 6th ed., Pearson Australia, 2014.
Badger, Emily and Christopher Ingraham. “The Middle Class is Shrinking Just About Everywhere in America.” The Washington Post, 11 May 2016, p. 1.
Centurion Strategies. “Scrub Daddy Announces Strategic Product Placement Deals with Wal-Mart, Kroger, Bed Bath & Beyond, Supervalu and Others.” Business Wire, 19 Feb. 2014, p. 1.
Fabio, Musso. “Innovation in Marketing Channels.” Emerging Issues in Management, vol. 1, 2010, pp. 23-42.
Hagerty, James R. “Sponge Makers Try to Woo Skeptics.” The Wall Street Journal, 13 Dec. 2013, p. 1.
Lowe, Ben. “Consumer Perceptions of Extra Free Product Promotions and Discounts: The Moderating Role of Perceived Performance Risk.” Journal of Product & Brand Management, vol. 19, no. 7, 2010, pp. 496-503.
Mandelbaum, Robb. “Trump’s Regulation Order: What It Means For Small Businesses.” Forbes, 31 Jan. 2017, p. 1.
Piotrowicz, Wojciech and Richard Cuthbertson. “Introduction to the special issue: information technology in retail: toward omnichannel retailing.” International Journal of Electronic Commerce, vol. 18, no. 4, 2014, pp. 5-16.
Scrub Daddy, Inc. About Us. Scrub Daddy, 2015, Web.
Spann, Martin, Marc Fischer and Gerard J. Tellis. “Skimming or Penetration? Strategic Dynamic Pricing for New Products.” Marketing Science, vol. 34, no.2, 2015, pp. 235 – 249.
Spring, Stan. “Case Study: Accelerated Growth at Scrub Daddy Inc.” Makerbot, 2016, Web.
Tănase, George Cosmin. “The Retail Growth Strategies on the International Market and the Global Development Opportunities for Retailers.” Romanian Distribution Committee Magazine, vol. 2, no. 4, 2011, pp. 28-33.
Thurner, Rob. “Mobile App Promotion Methods.” Smart Insights, Web.
Woelfel, Kaitlyn. Marketing Lessons From America’s Favorite Sponge. 2015, Web.
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