Michelle has told you that the board is now ready to see the final presentation of your plan for MM’s new product. “They are very eager to see what we have been working on during the past few weeks,” she says excitedly. “I am sure they will love the plan and am looking forward to your presentation.”
“Thanks,” you respond, feeling a few butterflies in your stomach. “I am looking forward to the presentation also. I think we have covered all of the bases and I am sure we have a solid plan. I have jotted down the order of items to cover that I think will be best for the presentation. What do you think?”
Objectives of the Plan
The objectives of the Plan have been given for the development of the new product. The objectives are set as practical, realistic, and measurable. These are aligned with the overall strategy of the company and its corresponding strengths and weaknesses. The objectives of the plan are:
Increase in Profit by 5%
The main objective of this plan is to increase the profit of the company from the sales of the new product by 5%. It is targeted by using aggressive promotional strategies and using cost analysis for potential areas of cost reductions.
Increase in Customer Base and Market Share
It is one of the crucial aspects regarding the goals of this plan. The new product is developed and marketed to expand the market base by expanding the customer base. It has been targeted to expand the customer base by adding 10,000 new customers.
Sales Target for New Product
The sales target for the new product has been decided on a minimum of 3% increment in the total sales contribution made by the new product.
Increase in the First-time Customers
It is important to constantly increase the customer base by adding new first-time customers in the customer bank. It is the only way to grow. A company cannot grow depending on its repeated customers only for a long time. MM Inc has targeted to increase its first-time customers by 10,000 new customers and converting these into repeated customers by 30%.
Increase in Return on Investment
One of the important measures of measuring business performance is also used in the targeting of the goal. MM Inc has targeted an increment of ROI of 4%.
Marketing Research Used for Target Market
The Marketing research which has been done for the identification of the target market is broadly dependent on the secondary data derived from internet sources for our competitors. The research conducted on the Samsung mobile target market has been primarily used for the identification of our market. It is because we have similar products which satisfy similar needs. MM Inc Target Market consists of boys, girls, teens and working couples. The markets of China, UK, Germany, US, and India would be targeted. People looking for following trends, professionals, large businesses, colleges, common cell phone users, and colleges are targeted. Medium to high-level income holders and creative open minded and people looking for lifestyle brands would be targeted (Bajaj, 2017).
Product
The product of the company is a Smartphone having the best software design and features in it. The company is currently having a rare opportunity to get ahead in the industry as it has a top-notch mobile designer for the development of the new product. The talent and experience of the designer can be utilized for the new product development. It is vitally important for the company to know the product demand in its market. MM Inc should be aware of the needs its product is going to satisfy. The gap between the target audience’s needs and the current offerings of the industry should be identified.
The product of MM Inc would have a Fiber liquid condensed display and use of nanotechnology for the charging of mobile phones from sunlight (Fowler, 2018). Other than this, another idea for the new product development which has been tested is that of the fingerprint sensor, more camera lenses, and battery charging for the air, and folded screens (Bhasin, 2017).
After screening of the ideas, the ones who were tested and selected for adoption in the new product development are fingerprint sensor embedded in the screen, and more lenses for cameras. The charging of the phone from the air, sunlight, and foldable screens has been researched but it has further future areas of innovation and product development (Zeine, 2017).
Pricing
As for the pricing of the product, it is important to consider all aspects as it is very important. Some believe that the pricing of the product is not that important if the product is of high quality and the brand name is strong enough. However, it is evident that people look at the price of the product and compare it with the value that they are receiving against the price. The comparison has to be equal or more in favor of the buyer as otherwise; it would not convert into a sale. For the Pricing of the new product, MM Inc needs to consider three aspects. Firstly, the demand of the customer; secondly, the competition; and lastly, the cost of production should be considered. The forecasting of the demand would yield results for pricing. The cost should be kept lower to have a lower price. Furthermore, the competitive prices of the competitive products would tell what prices should be offered in the market. MM Inc strategy should be to go for market penetration and price the product at lower than competitive prices for attracting first-time and repeat customers towards itself (Louis, 2013).
Distribution
The distribution of the Smartphone requires extensive channels and network for making the products available to the customers. Own distributors are one option which is extensively used by the competitors as well. Other than this, local distributors can be contacted as well. The retail segment would be incorporated in the distribution network as well. Service dealers and sales dealers would also be used for the distribution. Furthermore, Exclusive showrooms would be developed as well.
Regarding geographical regions for the product launch, it has been decided that products would be launched domestically first and then will be extended to the international region. It would help in approaching the domestic launch with more focus.
For our distribution, Intensive distribution would be the most appropriate option to enable the coverage of all geographical segments in the distribution network. Furthermore, after a year of working, profitable distributors can be contracted to continue for the long-term (Hill, Schilling, & Jones, 2016).
Another highlighted object is the supply of products. In the distribution of the products, as per the demand forecasting for each of the locations, products should be supplied and distributed to the best and shorter routes. Furthermore, it should be looked after as well that the supply to these distribution points is made constant.
Promotional Strategies
A wide range of promotional strategies and mediums are going to be utilized for the promotion of the new product. Aggressive promotion would be needed. The driving force of the potential customers should be advertised to give the pull effect. However, at the same time, the product would also be pushed onto the market by using aggressive sales promotions. Trade Partners and contractors for distributors would be given discounted offers. Festive seasons will be utilized for the promotion of the product. All aggressive types of advertising would be utilized including broadcasting, Live TV shows, sponsorships, Live Radio show sponsorship, Celebrity advertising, outdoor advertising, covert advertising, etc. The true vision of the company would be communicated in the promotional campaign. The advertising would be moved around a simple idea, conveying the need which the product satisfies. It is required that the message should convey the message which resonates with the audience and provides a medium for the association. A discounted offer for a limited period can be given at the launch of the product to attract the maximum number of customers for the product. Once sold, it can then yield repeat customers and also good reviews for potential buyers (Louis, 2013).
Measuring Results
For the measuring of the results, we are going to use two different sets of measures. Firstly, as with all results, the best measures are the objectives and goals themselves. The set targets which were targeted at the start of the plan are the best measures for measuring the performance of the plan. Therefore, the results would be measured against these objectives. These include
- Increase in Profit by 5% or more.
- Increase in Customer Base and Market Share by the addition of 10,000 new customers or more.
- Sales Target for New Product increasing total sales by 3% or more would be considered a good result.
- An increase in the First-time Customers with 10,000 or more would be measured. Any results less than this would mean a bad result. Furthermore, 30% of these first-time customers have to be converted into repeat customers in the next year.
- The increase in Return on Investment is 4% or less. An increment of less than 4% would be considered a bad result.
Other than these, the results of the marketing campaign or the promotional campaign would be measured through the following measures.
- Lead Conversion
- Quality of Web Content on Online mediums
- Individual visitors to the website
- New visitors and returning visitors to the website
- Click Through Rate
- Bounce Rate
- Page Views
- Search Engine Referrals
- The effectiveness of social media
- Opening of Emails
- SEO Position (Cleverism.com, 2015)
Contingency Plans
The Contingency Plans are developed to identify the areas which can go against our plan and get prepared for it. MM Inc needs to be ahead of its competitors and market. It is currently not expected that there will be any price competition in the market with the launch of our new product, however, because of the increased advertising, it can lead to such a situation. For this reason, sensitivity analysis can be conducted to check if any further expansion at the advertising expense would not affect our pricing and costing of the product. Therefore, in the event there is increasing price competition, MM Inc can further increase its advertising budget and also lower its market price. Other than this, a contingency plan for any lower demand than expected is formulated as well. In case MM Inc experiences low demand domestically, then it would expand its international budget for promotion of new products and use the leverage in international regions (Gilligan & Wilson, 2012).
References
Bajaj, A. (2017). A Study on Market Segmentation of Samsung Electronics Ltd. International Journal of Advance Research, Ideas and Innovations in Technology, 3(5), 367-372. Retrieved from Ijariit.com.
Bhasin, H. (2017, December 16). New Product Development. Retrieved from https://www.marketing91.com/new-product-development/
Cleverism.com. (2015, July 20). How to Measure the Effectiveness of Marketing Campaigns. Retrieved from https://www.cleverism.com/how-to-measure-effectiveness-of-marketing-campaigns/
Fowler, G. A. (2018, June 29). Whoa! Meet the future phones that fold up, have 9 cameras and charge over thin air. Retrieved from https://www.washingtonpost.com/technology/2018/06/29/whoa-meet-future-phones-that-fold-up-have-cameras-charge-over-thin-air/?noredirect=on&utm_term=.e8d5d2b49902
Gilligan, C., & Wilson, R. M. (2012). Strategic Marketing Planning. Routledge.
Hill, C. W., Schilling, M. A., & Jones, G. R. (2016). Strategic Management: Theory: An Integrated Approach (12 ed.). Cengage Learning.
Louis, T. (2013, September 14). The Real Price Of A Smartphone. Retrieved from https://www.forbes.com/sites/tristanlouis/2013/09/14/the-real-cost-of-a-smartphone/#27b379985938
Zeine, H. (2017, May 23). The Future Of Smartphones. Retrieved from https://www.forbes.com/sites/forbestechcouncil/2017/05/23/the-future-of-smartphones/#4280744b1885
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