Vertu Company’s New Product Advertising Strategy

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Table of Contents

Introduction
Problem Statement
SWOT
Summary of the Facts
Analysis of the Facts
Alternatives
Recommendations
Conclusion
References

Introduction

To begin with, it should be stated that the advertising strategy, for the type of goods, which are classified as the items of luxury, requires its own particularities and special features. Originally, Vertu cell phone is oriented for the restricted manufacturing and exclusive, handcrafted design. As for the advertising strategy for Vertu Signature – S Design model, it should be stated, that there will be lots of difficulties in creating the strategy for this model on the one hand, nevertheless, some features of this device make it easy to promote as a brand. An advertising strategy should support the marketing plan, which in turn supports the company’s business plan.

Problem Statement

The fact is that, Vertu is the obscure and exclusive model of the cell phones because of its astronomical price and selective points of sale. The latter is due to those that know of its existence; most would consider that one has to be out of his mind or just struck oil rich, to blow an average of $10,000 (or more, in many countries with luxury tax) on a phone. (Mitchell, 2006)

The advertising strategy of the Vertu phone should be developed to communicate the ideas about this device and services, which will be available for the consumers in the hopes of persuading them to buy this phone. The fact is that, the strategy should be built in a rational and intelligent manner, for attracting the potential customers and hitting the target audience, which considers itself the elite of the world.

There is also strong necessity for reflecting other business considerations, which are relevant to the business strategy of the company (overall budget and brand positioning tactics), and the aims and objectives of the company (public image improvement, market share enlargement)

On the other hand, Vertu was faced with two other challenges at this point. Firstly, to design a marketing program that would sustain product excitement utile dealer product availability. Therefor the Marketing Vice President of Vertu had come up with the following objectives:

To build an order bank to enable the new factory to create the new base of Vertu customers, orienting the changing requirements to stylish devices
To use the S design series to motivate and stimulate the dealer network to meet higher standards to qualify for the cell phone market.

The fact is that, the key aims of the advertising strategy should be closely associated with the intention of generating awareness of the business and production. If the reputation of the company is included in the positioning principles of the production and the brand, it should be mentioned that the amount of the resources, which will be used for the marketing strategy implementation in general and advertising strategy in particular will decrease with the increase of customers’ loyalty to the product.

According to Woodside (2007): “established and ever-growing consumer base will eventually aid the company in its efforts to carry their advertising message out into the market, both through its purchasing actions and its testimonials on behalf of the product or service.”

SWOT

Summary of the Facts

First of all, it will be necessary to formulate the positioning of the device for proper advertising on every market. Consequently, it will be required to analyze the production by the competitors, for comparing the models, and stating the most attractive features.

In spite of the fact that it is the exclusive series of the cell phones, aimed at the audience of rich dandies, and there are no similarities among other manufacturers, there are lots of copies on the market, and, thus, there is strong necessity to emphasize the exclusiveness of the models and the advantages of purchasing the original models. Another fact that should be emphasized is the strong necessity of creating the advertising strategy from the point of view of brand positioning issues. Taking into account that the brand positioning is one of the most crucial components of the advertising strategy, it should be pointed out that this component should entail the protection measures from imitations.

In late 2008, where the new Signature S was introduced, sporting a sleeker silhouette, Quad-band (as compared to Tri-band model in the review), and even better hardware (e.g. 4 gigabyte of memory). The Signature is not known for wide range of functionality (it is actually KNOWN for not having much). It features basic applications such as Alarm Clock, Calculator, Calendar, Converter, Notes, Synchronization, To-Do List, Voice Recorder, Message, and World Clock. It has no camera feature.

Analysis of the Facts

From the point of view of the regarded facts, it is necessary to stipulate, that the advertising strategy will entail numerous factors and principles, aimed at solving the most common problems of the exclusive goods. As for the matters of technology in these luxury phones, Reynolds and Olson (2006) in their research emphasize the following: “Not much of a difference from a mid-segment mobile phone. A Vertu does not come even with a camera. Nevertheless, there are other features like, an owner can get-in-touch with the company’s client servicing team, simply by pressing the concierge key on their phones anytime of the day”. Originally, this is the exclusive feature, which is aimed to provide all the possible advantages for the customers, who choose the original models.

There is strong necessity to get penetrated to all the markets of high-class cell phones. The fact is that, Japan is one of such markets, and it is regarded to be rather complicated. Tai and Wong (2008) sates that “Domestic makers dominate handset sales, with a 95 percent of the market, churning out high-spec, feature laden cell phones with applications very specific to Japan. They, too, however are struggling in an overcrowded market that has been knocked on its side after Japan’s main operators implemented a strategy last year of forgoing heavy subsidies of mobiles to focus instead on lowering monthly tariffs. Analysts believe phone sales in Japan could shrink up to 20 percent as a result.”

Another fact, is the possibility of easy conquering of the market. It should be stated, that the market of exclusively designed phones is not filled enough for the strong competition, nevertheless, the audience is comparatively small, and often chooses the devices of lower class, however – more functional. This audience requires technical perfectness of the devices they choose, while Vertu is just a beautiful toy without serious technical opportunities. As Laroche and Kirpalani (2007) stated: “The company will also come out with a set of mobile related accessories later this year. These may not be as pricey as the mobile phones, but would surely buy a non-luxury high-end phone!”

Alternatives

Originally, there should be firm objectives for the advertising strategy, nevertheless, the alternatives, which will be implemented for the solution of the analyzed problems will be regarded as the required point of the advertisement planning. Originally, the following elements of the strategy should be taken into account:

Target audience. In the case when the audience prefers the imitations of the phones, there will be an opportunity to fill the market of the imitations. In the circumstances of the financial crisis this alternative will be rather helpful
Product concept. Originally, this factor should be the firmest feature of any product, and there are no alternatives possible. The main concept of Vertu is style and beauty, and, without them this product will lose its image.

Taking these features into account, it is necessary to emphasize that Woodside (2007) stated the following in his review: “what the advertisers stress from the start is clear planning and flexibility. Moreover, the only way to these aims is creativity, and the capability to adapt to new market trends. An inflexible promotion strategy of Vertu may lead to a loss of market share. Consequently, the central elements of the advertising strategy need to mix in a way that permits the message to envelop the target customer, providing many opportunities for this consumer to become acquainted with the advertising message”

Recommendations

The recommendations for the regarded advertising strategy will be few, however, the most essential. There is strong necessity for precise targeting of the audience. Originally, such targeting is a complex combination of personal approaches to the customers. In the case of Vertu phones, this concept is exclusively precise, as the customers are rather few. Thus, everyone should be targeted with care and attentiveness.

As for the marketing recommendations for the strategy, the following factors should be taken into account:

Percentage of future or past sales
Competitive approach
Market share
All available funds
The objective approach

Conclusion

Finally, it is necessary to emphasize that the advertising strategy for the Vertu cell phone is a complex assignment with numerous difficulties and special features. Originally, it is no strong necessity for it – it is an expensive toy, or a part of the image, consequently, the strategy should be elaborated with excessive care and professionalism.

References

Laroche, Michel, V.H. Kirpalani, Frank Pons, and Lianxi Zhou. “A Model of Advertising Standardization in Multinational Corporations.” Journal of International Business Studies 32.2 (2007): 249.

Mitchell, Andrew A., ed. Advertising Exposure, Memory, and Choice. Hillsdale, NJ: Lawrence Erlbaum Associates, 2006.

Reynolds, Thomas J., and Jerry C. Olson, eds. Understanding Consumer Decision Making: The Means-End Approach to Marketing and Advertising Strategy. Mahwah, NJ: Lawrence Erlbaum Associates, 2005.

Tai, Susan H.C., and Y.H. Wong. “Advertising Decision Making in Asia: “Glocal” versus “Regcal” Approach.” Journal of Managerial Issues 10.3 (2008): 318.

Woodside, Arch G. Measuring the Effectiveness of Image and Linkage Advertising: The Nitty-Gritty of Maxi-Marketing. Westport, CT: Quorum Books, 2007.

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