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Executive Summary
Titan is a ball manufacturing company found in Sydney, Australia. The company was established in 1960. Initially, the company was contracted to make high-class balls for huge corporations based in the country. Therefore, the company had no department for marketing. However, in 2010, the company got its first contract to supply soccer balls to the Australian premier league. The company is planning to open a sales office in Perth.
This makes the sales function a necessity. The company will serve a geographical area covering the city of Perth and its surrounding. The targeted market will include schools, sports clubs, premier leagues, and individual consumers. The company is expected to increase sales substantially over the next year. Sales are projected at around $450000 in the first year. The gross margin is expected to be over 60 percent.
Introduction
Company’s Overview
Titan is a sports ball manufacturing company located in Sydney, Australia. The company was established in the1960. Initially, the company was contracted to make high-class balls for huge corporations based in the country. Therefore, the company had no department for marketing. However, in 2010, the company got its first contract to supply soccer balls to the Australian premier league. Given the growing demand for the company’s products and the opening of a new sales office in Perth, the marketing department became necessary.
The company had recognized the significance of marketing strategies in the overall success of the organization. Marketing strategy is a process by which companies can maximize great opportunities to enhance sales and attain sustainable competitive advantage using the available scarce resources (Kotler & Armstrong, 1991, p. 3).
There has been an increase in sports participation in Australia (Long, 2012, p. 50). According to a recent survey, the number of people engaged in a sporting activity at least once a week has increased by 50% over the last decade. The fastest-growing sport in terms of participation is basketball. Other sports with strong following include Australian Rules, soccer, rugby, and netball. The survey also revealed that most families would have at least one child actively engaged in Australian Rules, basketball, soccer, rugby, or netball.
The competition balls for these sports are made of quality leather and are usually very expensive. These leather balls are used in competition because they have a more natural touch. However, they do not last long and often lose their texture very fast. As a result, Titan recently tested a new type of material for its sports balls. The balls made from these materials had qualities of leather balls. For instance, they had a natural touch and lasted long. Titan also came up with an exceptional valve that could not leak for almost half a year.
Report Purpose
The main focus of the report would be on the recommended target market, the marketing mix components, and the positioning of the product. The report will also include market analysis (SWOT analysis). SWOT analysis is carried out to provide a better understanding of the internal and external factors that would impact the company. Lastly, the report will provide a projected income statement.
SWOT Analysis
SWOT is an abbreviation for Strengths, Weaknesses, Opportunities, and Threats. SWOT analysis is commonly used in business studies to explore the existing conditions to come up with possible solutions or strategies for addressing both internal and external challenges (Chapman, 2007, p. 2).
Strengths
These are the core competences of the company. The main strength of the company is its personnel. Titan boasts of highly trained and competent personnel whose main focus is high quality and innovative products and customer satisfaction. Service quality and customer satisfaction have always been the foundation of Titan. The company has managed to achieve all these because of its highly proficient personnel. The company’s strength is also in its highly innovative products.
Titan is the first company to improve the sports balls in Australia. Titan has developed a revolutionary material for the sports balls that is very natural and long-lasting. The balls made from these materials had qualities of leather balls. For instance, they had a natural touch and lasted long. Titan also came up with an exceptional valve that could not leak for almost half a year. This has given the company a competitive edge in the industry.
Weaknesses
The company’s main weakness is attributed to inadequate publicity. This is because most companies advertise their brands very extensively, but sports balls are rarely promoted in the mainstream media. Instead, they rely on the overall reputation of the brand. For example, Adidas is a major brand for soccer products (jersey, shorts, balls, and boots, among others), and their soccer balls are the leading brand.
Another weakness is the high cost of production. The high cost of production hurts the profit margin. The new balls cost more to make than rubber balls. Also, the newly innovated balls are not allowed in major competitions. This is due to a lack of sponsorship contracts and approval from the relevant authorities.
Opportunities
The increase in sports participation in the country provides the company with the best opportunity. According to a recent survey, the number of people engaging in sports activities has considerably increased in the last decade. This has increased the demand for the company’s products. The company can also adopt several strategies used by global brands.
For instance, signing contracts with famous sports events such as the Olympic Games, Commonwealth Games, Champion Leagues, and World Championships. The company can also enter into sponsorship deals with clubs and famous sports icons. Last but not least, the regional market also provides a major opportunity for the company to expand its market and increase its sales revenue (Kriemadis & Terzoudis, 2007, p. 28).
Threats
The biggest threat comes from major multinational companies based in the country dealing in similar products, for instance, Puma and Adidas. As a result, competition is relatively stiff. The company also faces competition from Chinese companies importing similar products in the country at a relatively lower price (Long, 2012, p. 52).
Marketing Objective and Strategy
Marketing (Financial) Objective
The marketing objectives include sales objectives and customer satisfaction goals. The core objective is the generation of massive numbers of leads and media coverage. The company is expected to increase sales substantially over the next year. Sales are projected at around $450000 in the first year. The gross margin is expected to be over 63 percent. Also, the company expects to attain a net income of around 14 percent. Last but not least, the company aims to attain a high level of client satisfaction.
Strategy Statement
As already been mentioned, the company will be providing high-quality leather balls for its client. The company will serve a geographical area covering the city of Perth and its surrounding. The targeted market will include schools, sports clubs, premier leagues, and individual consumers. The brand positioning will be classified into two sections: customer’s satisfaction and advertising.
Based on the satisfaction of the consumers, the main goal will be ensuring that the existing clients are maintained. In advertising, the company will rely more on media advertising than any other medium of promotion. This is the only channel that can reach the largest proportion of the targeted market (Lee, 2012, p. 169).
Marketing Mix Strategies
The concept of the marketing mix includes many aspects of marketing which are related to the creation of awareness of a brand and consumer loyalty in the market. In the promotion of the company’s brand in the Australian market, all the facets of the marketing mix will be employed. The four components of the marketing mix are price, promotion, product, and placement. The blending of these four aspects of the marketing mix will result in a marketing strategy that will ensure that the brand meets consumer expectation (Lee, 2012, p. 170).
Product design and development
The company will provide standardized and convenience products. The brand is expected to go through all the four stages of product life cycle development in five years. The four stages are a brand introduction, brand growth, brand maturity, and brand decline.
The research and development team will be assigned the task of coming up with new products under the Titan’s brand name in order to ensure that the company meets the pressure of the competing brands in the market, meet the changing tastes and preferences of the consumers, and ensure sustainable growth and development of the company (Lee, 2012, p. 175).
Pricing Strategy
The company will set prices that reflect savings when compared to the actual value of the product. The company’s brand products will be priced at the upper edge to match the general positioning of the company as a high-quality product and service provider. This is because low prices are normally associated with poor quality.
The company prices are set at a mark-up of 30% on the cost of production. However, in Perth, the balls will cost $20.00 more. Also, the prices will range from $40.00 to $100.00 depending on the product positioning, target market, sales volume, and other marketing inputs.
Promotional Strategy
The promotional strategies will be employed in creating an awareness of the presence of the company’s brand in the target market. The promotional strategy that will be used will ensure that the targeted customers get the right information about the product. The strategy used will include advertising, discounting, and publicity. Also, the company will use each and available opportunity to build its brand and preserve customer loyalty in Perth and other markets.
Distribution Strategy
Companies normally use numerous strategies to penetrate the existing and emerging markets taking into consideration the challenges and the opportunity they present. The company will employ two channels of distribution: direct contact with the clients and contracts.
The company will enter into contracts with various clubs, leagues, and schools to supply balls. Also, the company will enter into agreements with some of the local shops and retail outlets to market/sell their products. This will also help the company to penetrate the target market.
Income Statement (12 Months)
The table in appendix 1 and 2 shows the projected income statement in the next 12 months. Sales are projected at around $450000. On the other hand, the gross margins are expected to remain over 60%.
References
Chapman, A. (2007). SWOT analysis. Web.
Kotler, P., & Armstrong, G. (1991) Principles of marketing. Englewood Cliffs, New Jersey: Prentice-Hall.
Kriemadis, T., & Terzoudis, C. (2007). Strategic Marketing Planning in the Sport Sector. Sport Management International Journal, 3(1), 27-45.
Lee, K. Y. (2012). The business of marketing. Perth: Stratstar Publishing.
Long, J. G. (2012). Public/private partnerships for major league sports facilities. New York: Routledge.
Appendices
Appendix 1: Projected income statement (Annual)
Appendix 2: Projected Income Statement (Monthly)
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