Initial Release- Mobile Manufacturing Inc

Case Mobile Manufacturing, Inc.

Michelle Dietrich, president of Mobile Manufacturing, Inc. (MM), stared out of her third-floor window at the traffic below her San Jose, California office and said to herself, “This new product has to be right. If we can’t gain back a significant share of the mobile phone market with this product, MM is not going to be here next year.”

Michelle’s company made its debut in the mobile phone industry in 2002 when it invented the first mobile phone that could access the Internet. At the time, this gave MM a huge advantage over its major rivals.

Mobile Manufacturing, Inc.’s first successful product and initial public offering (IPO) in 2003 raised enough capital to help the firm develop new products, but since then, the technology giants have caught up with them. Although MM had some success with other products, it has not been able to match its initial success and distinguish itself from its rivals. MM—though it was the darling of the technology world in the early 2000s—was struggling to attract first-class employees and new investors; it was floundering in the market.

After several failed attempts at new products, Michelle hired Elena Steokovich, the top cell phone designer and engineer in Europe, to help design a new product. Elena knew her stuff when it came to phone product design, and she had worked with Michelle on MM’s first product. After stints with big-name competitors, she agreed to return to MM to help Michelle restart the product innovation engine.

“I know that just designing a good phone will not be enough,” thought Michelle.

“Perhaps the most important question is: How do I know if anyone will buy our phone? Certainly market research will help us identify potential customers so that we can target them effectively, and careful analysis of the research findings will lead us to a good marketing plan. Yes, the marketing plan is the key. I need to know that the next phone we develop will meet the needs and wants of those who crave the latest and greatest technology in their mobile phones.” MM needed to get back a market share if it was to survive in a fiercely competitive environment.

Michelle also knew the mobile phone and technology markets had changed drastically in other ways since MM first entered the market. There were new domestic and foreign companies competing, increased market demand driving prices down, and innovative products being introduced every year. Although some consumers were happy to try out the latest and greatest products, a large number of customers were suffering from feature fatigue, a term used to describe the tiring of the bells and whistles. The customers with feature fatigue just wanted to make phone calls to their family and their friends.

To help ensure that MM has the right marketing plan for its new mobile product, Michelle has hired you as her marketing consultant for this project. As the marketing consultant, you will be responsible for planning, organizing, and implementing the marketing plan for MM’s new product.

Based on your discussions with Michelle, you have developed a clear picture of the environmental issues that will affect the initial release of the new product. As you compile your notes, the phone rings.

“Hello?” “Hi. This is Michelle. I want to touch base with you about your presentation to the board next week. Do you have any questions about the upcoming meeting?”

“Thanks for calling,” you say. “You have good timing. I was just reviewing my notes and working on my PowerPoint presentation. I think I’ve covered the areas we discussed at our last meeting. Do you have something else that you want me to include?”

“Oh, good,” says Michelle. “Yes, I’d like you to share 3 or 4 goals for the marketing project, too. Make sure these goals are specific as possible. You might want to lead with the goals, but I’ll leave that up to you. Naturally you’ll need to do some research to determine the types of goals that are relevant for a new product project like this. Be as specific as you can when outlining realistic expectations.

“Okay,” you say as you jot down more notes. “Anything else?”

“Just be sure to include your thoughts about whether we should develop a product that can be marketed world-wide. You know that is one of their main concerns. You’ll have about 30 minutes for your presentation. ”

“Will do. Thanks for the information. I think about 10–15 slides should be about right for a 30-minute presentation.”

The students should list and explain 3–4 goals that a company in this situation should set for itself. The explanations should be 2–3 sentences each, and they should include citations from the text and other sources. Each goal should be as specific as possible; for example, the goals might include—among other things—the following items:

• Sales in dollars or units
• Market share
• Customer awareness
• Profit
• Return on investment
• Customer satisfaction

Case Solution

Introduction

This report is based on the marketing consultant working on the company’s new product launch who is hired by the President of the Mobile Manufacturing Inc which is a California based mobile phone company The company was right there in the middle of the mobile phone arena with its world-famous Blackberry in 2002 which provided the mobile users with the feature of accessing the internet. This new feature enabled the company to reap good revenue in its early launch years. However, in the following years, after an initial aggressive rise in sales and the ability to raise funds, the company found that it could no longer remain dependent on the same product as its rivals had gained pace. Eventually, the time came when MM was not able to keep pace with the industry giants regarding attracting talent and customers. The company has seen its position go down with unsuccessful launches of new products. The role of the marketing consultant is going to be related to the development of the Marketing Plan and more importantly for the introduction of the product in the market and adopting a more sustainable approach towards the product launch of Mobile Manufacturing Inc this time. Any marketing strategy is developed by evaluating the internal and external environment of the company. This presentation will also assess the environmental factors for better strategizing on the new product launch. The presentation will be steered through the preferable marketing mix and environmental factors of the company; however, the goals of the marketing plan will be suggested first.

Goals of the Marketing Plan

The goals of the marketing plan for the new product development should be realistic, practical, measurable, and aligned with the overall strategy of the company, its strengths, and weaknesses.

These goals include.

• Increase in Profit

The profit is targeted to be increased by 5% on average on all products to improve our net income. It will be done by using aggressive promotional strategies and conducting an in-depth cost analysis to evaluate any margins for cost reductions.

• Increase in Customer Base /Market Share

It is one of the most crucial aspects of marketing goals. It is needed to expand our customer base as the company has lost its major market portion of the latest Smartphone companies and Apple Inc. One strategy could be to expand into a global region where the mobile market is still ripe for Blackberry products.

• New Products Sales Target

It is targeted to achieve a minimum of a total sales increment of 3% from the sales of the new product. It shows that the new product is targeted to achieve 3% of past sales value.

• Increase in First-time Customers

One of the most important dynamics of market growth is represented in the growth in the first-time customers of the company. With the launch of the new product and the aggressive promotion of all existing products, it is targeted to attract 10,000 new customers. It is also targeted to convert these first-time customers into repeat customers by 30%.

• Increase in Return on Investment

One of the most important metrics for any business performance measurement is its return on investment. It is targeted for MMI to increase its return on investment by 4%.

Marketing Plan

As Michelle has impressed upon me the importance of the marketing plan, it takes the prime importance of this report. It has been pressed upon that even with a very good new product, the success of its launch would be impossible without an aggressive and effective marketing plan. The company is doomed to see its product launch fail by having expertise on the technical side of the business but lacking in the field of marketing management and its importance. For this reason, this report is focused on advising on building an effective marketing plan.

Product Strategy

Opportunity

It is assumed that the company now finds itself with a rare opportunity of having the top-notch mobile designer from the industry giant. The top-notch mobile designer is given the lead in the design of the new product. She has had some extensive experience with the top rivals of the company. It presents the opportunity of utilizing the experience and talent of this high-profile mobile designer to capitalize on it and initiate innovation in the new product development.

What need does our Product Satisfy

It is important to know what qualities this new product is going to satisfy. We should precisely know what needs of our target market is going to be targeted by this product. The products of Mobile Manufacturing, Inc even if currently not known publicly for its best features, its first product, Blackberry, certainly enjoys a good reputation. The goodwill of the Blackberry product would help the company in its product launch. It is needed to know the gap between the needs of the target audience and the product qualities and features which satisfies it. One of the major features which can help get the company competitive edge is the Fiber Liquid Condensed Display with detachable screen and with the use of nanotechnology for using sunlight for charging the mobile phones (Singh, Mittal, & Pandey, 2016).

Target Audience

The target audience of our product is urban individuals who are looking for mobility and functional ability in their phones with the features of having access to software, applications, and all other internet-based facilities. Youth, professionals, businesses and the creamy layer class are the main target market for our product. Another important sector includes the individuals and businesses looking for renewable sources of energy and a more sustainable way of living (Singh, Mittal, & Pandey, 2016).

Promotional Strategy

Mobile Manufacturing Inc needs to use a variety of promotional mediums for an aggressive promotional strategy. The main driving force should be to attract customers to them via advertising, however at the same time also push the product with the use of aggressive sales promotions to the customers. As festive as well as non-festive seasons should be adopted for promotional strategies. Discounted offers to the distributors and trade partners should be given to attract them to hold and sell the new product against its rivals. Print Advertising, Covert Advertising, Celebrity Advertising, broadcasting, outdoor advertising, and other promotional strategies need to be included in the marketing strategy. The advertising strategy should be very effective regarding conveying the true vision and the message of the new product and company. The customer should know and understand immediately about the product’s qualities, its features and how it caters to their specific needs. For this reason, high promotion costs are needed to be incurred by the company. It is needed because the new product needed to be injected into the market, which is very competitive (Kareh, 2018).

Pricing Strategy

Price is one of the key factors is the sale of the product. Some believe that the pricing of the product does not matter if the quality and brand recognition is strong. However, it is a fact that people tend to look at the price first and then consider what value they are receiving against it. This comparison, if not equal or tilting towards the buyer would convert into a lost sale. Thus, this shows how much importance the pricing strategy is regarding the product’s success. It is also one of the factors which are open to most changes as with different environmental factors; different pricing strategies are adopted. For instance, during highly competitive pricing, penetration or skimming pricing strategies can be used. There are usually three main factors which are to be considered while looking at the pricing of the product. It includes the customer demand, the competition and the cost of producing the product. The higher the demand, the higher price can be charged. The higher the cost, the higher price is needed to be charged. And in higher competition, lower prices are a better option for attracting customers. For MMI, the best pricing strategy would be to use penetration pricing strategy (Shapiro, 2018).

Place Strategy

The mobile phone industry needs to have an extensive distribution channel to make its products available for the customers. Like some competitors, our distributors can be used for distribution purposes, or local distributors around the region can be utilized for distributing. The retail segment should be focused as well on making sure that our product lines are featured in their electronics section. The individual promotional strategy can be used for the individual retail stores as specific to the store dynamics. Sales and Service dealers are also used for handling the key accounts and the corporate sales. The company can make individual contracts with the dealers to open exclusive MMI showrooms (Anselmo, 2010).

Global Launch or Domestic Only

At this stage, it is advisable to go for the domestic product launch first. However, MMI should be prepared for launching it globally as well. After its successful launch in the US region, MMI can then extend its launch to specific international regions. It will not only make sure that the plan for regional success is more focused but also provides an opportunity for global expansion.

Environmental Factors

MMI is needed to cater to these individual factors of the marketing strategy in an integrated manner to make sure it is effective as well.  For the development of an efficient strategy for marketing, it is needed first to take an in-depth evaluation of the external environmental factors. It is needed to use the results of the evaluation of the external factors in better strategizing the marketing strategy. Normally, the PEST analysis includes Political, Economic, Social, Technological factors of the company. However, regarding the Mobile Phone industry some of these are more important, and thus these will be discussed (Perera, 2017).

Political Factors

It is important for the company to remain up to date with the changes in the laws and political realms of the region. Governmental regulations have a strong influence on the potential success of a company. The company is needed to comply with the laws and move within the allowed legislation of the labor rules. Taxation policies have a strong influence on the profit-making ability of a company. Rising taxes pose a threat to the company’s profit. As this is an external factor, it is important to know that this factor is beyond the control of the company authority and the company therefore only can adapt to the changes.

On the other hand, it is essential for the company to operate in a stable economy and politically peaceful environment. It is essential that the company feels secure, guarded, and confident in a new political region. MMI is needed to evaluate the international points which are more suitable for its business operation (Cadle, Paul, & Turner, 2010).

Economic Factors

The economic condition of the region in which the business is operating is important to be considered as well. The economic stability of the country is important to grow and operate business. Factors like the consumer purchasing power, the spending patterns of the economy are important to be considered as well. The economic level of a region, its growth potential, and its income level affect the growth potential of the business as well. The company needs to make an effective strategy taking in consideration the economic perspective as well. The changes of the economic factors, buying patterns, and tendency to move towards luxury goods affect the overall consumption pattern and the business potential. Inflation is another factor which affects the business operations of the companies dealing in this region. The economic climate of the region has a direct influence on the behavior and potential of the suppliers, consumers, creditors and other stakeholders (Cadle, Paul, & Turner, 2010).

Social Factors

Another important environmental factor is that of the social aspect of the environment. The various forces are working in society like the family units, friends, neighbors, colleagues, and media. These are the main forces which shape the way consumer buying patterns are developed; businesses are operated, values and beliefs of the society and consequently its businesses are established. For example, the high obesity of the US citizens has started a trend of organizations to work against it. Furthermore, the bullying trend has also been discouraged by organizations to increase their good will. Sustainability and green renewable energy sources have also received high attention, making the companies move to more sustainable business operations and products. It is one of the factors in which MMI has a competitive advantage. The newest product of the company is based on solar charging, which is a move towards a sustainable future. Population dynamics also influence the organizations. The structure and the values of the population show that the company needs to consider these as important factors as well (Perera, 2017).

Technological Factors

The technological perspective on the mobile phone industry shows that technology is that one thing in which it is difficult to create a new customer than retain an older one. It is an important factor as, through the use of innovative technology, MMI can create sizzle, get the attention of the customer, and make them MMI’s customers. It is important to consider that MMI needs to offer its products against Apple’s integrated platform which allows the iPhone users to use their iOS for moving easily from one device of Apple to another. Furthermore, it is to be noted that technology is that one thing which is constantly getting obsolete. Technology is constantly updated with new versions and systems become obsolete. Companies need to constantly innovate and present new technology in the market to remain competitive (Perera, 2017).

Conclusion

It is concluded that the environmental analysis and the marketing mix analysis show that the mobile industry is a very competitive market. Hence its various factors are important to be analyzed. The marketing mix shows the product qualities, customer need, target audience and opportunity in the product section, aggressive marketing, and promotional strategy, penetration pricing strategy, and extensive distribution strategy for domestic and the global placement strategy is evaluated. It is recommended that MMI should work on launching its product in the domestic region with success at first and then launch it in the global region as well. The more aggressive and innovative the marketing strategy is established, the more chances it has of becoming successful. The global launch is suggested to be launched in the scenario that the domestic product launch is considered successful. To conclude, it can be said that MMI needs to consider all factors and manage it in an integrated manner.

References

Anselmo, D. (2010). Marketing Demystifiedg. McGraw Hill Professional.

Cadle, J., Paul, D., & Turner, P. (2010). Business Analysis Techniques: 72 Essential Tools for Success. BCS, The Chartered Institute.

Kareh, A. (2018, January 3). Evolution Of The Four Ps: Revisiting The Marketing Mix. Retrieved from https://www.forbes.com/sites/forbesagencycouncil/2018/01/03/evolution-of-the-four-ps-revisiting-the-marketing-mix/#5d64f01d1120

Perera, R. (2017). The Pestle Analysis. Nerdynaut.

Shapiro, B. P. (2018). Rejuvenating the Marketing Mix. Retrieved from https://hbr.org/1985/09/rejuvenating-the-marketing-mix

Singh, R. K., Mittal, A., & Pandey, A. (2016). Understanding The Marketing Mix Of Smartphone. International Journal Of Scientific & Technology Research, 5(8), 132-136.