3-Year Marketing Plan Essay
3-Year Marketing Plan
In order that we continue our company’s financial growth, we need to branch out into new product lines. A study was performed to consider our entrance into the pet supply market. We have developed a new single product for that purpose. It is a Cordless Automatic Nail Trimmer for dogs and cats. The findings of this study are in this presentation. Our numbers are conservative. The potential for success is high. We are Company G are always looking forward to find and implement new lines that will complement our Mission statement, and our bottom line. This is our next opportunity introduces Company G and the product or product line that you are writing this marketing plan about.
“We enable consumers to improve the quality and convenience of their lives by providing innovative electronics solutions.”
Product Description and Classification
The Cordless Automatic Nail Trimmer for Dogs and cats will be our first entry into the world of pets. This product uses a sensor to find the quick (the bundle of nerves and blood vessels) on a pets nail, then adjusts to a spot just below it. It trims the nail, rotates to the next nail, and repeats the process, until trimming each nail on the paw. Simply remove the paw, and continue on each paw until done. Our trimmer will avoid the pain of cutting the quick with bleeding. It will not cause discomfort for the animal associated heat build up from electric nail trimmers. This product will allow anyone from novice to professional to trim a dog or cats nails to perfection. Rather than making an appointment, going to the local pet groomer, paying $7 to $25 (before tip), or big box, a pet owner can trim their pet’s nails at home. If the owner would rather have the nails done, they can have their groomer use our tool, giving the pet owner peace of mind, knowing their pet will not suffer any pain.
Consumer Product Classification
Planning time involved in purchase
Importance of convenient location
Comparison of price and quality
Marketing Mix Factors
Importance of seller’s image
Distribution channel length
Number of sales outlets
Personal selling and advertising by producer and seller
The target market is between the ages of 30 and 45 with busy lives, looking to save time and money. Their incomes would be greater than $60K. This will include professionals, as well as working couples. We will target both existing dog or cat owners, as well as new entrants to pet ownership.
Competitive Situation Analysis
Analysis of Competition using Porter’s 5 Forces Model
Today are no direct competitors. We are entering an existing market, with a completely new technology. The closet rivalry is the electric trimmer, produced by Dremel Tools and Oster Company. These products do NOT have the features we have. They do not compare in experience. There is no threat at this time.
Threat from New Entrants
We have the threat from two outside entrants to create a knock off version of our automatic nail trimmer. The two companies that could attempt to enter the market are Dremel Tools and Oster Company. The threat to us is medium for a few reasons. We will patent our trimmer, which means that they will have to start with our product, and then develop modifications, to avoid patent infringement. Both companies’ current products use a different kind of technology. They are grinders and do not have any quick detection apparatus’. While Dremel Tools has been in the pet trimming market for some time, they only modified the grinder used for woodworking and other craft projects. This would be a departure from their core competency. This is the only venture by Oster Company. They a relatively new to the market, It isn’t likely that they will put more R and D dollars into a second pet product at this time.
Threat from Buyers
There is no threat to us from buyers. Pets must have their nails trimmed on a regular basis, or they can suffer pain and / or health issue. The owners of these pets are responsible to maintain their pets’ nails. With the addition of our safe, reliable, easy to use product added to the market, buyers have all of the options they could want. At our price point, they would not consider creating a similar product. It is an infrequent purchase for them. We will also establish a blog site to give our customers an opportunity to help us determine if they desire any additional features.
Threat from Suppliers
There is very little threat to us from our two suppliers. Vendor A is supplying us with the heat-sensing component to our trimmer. The device they are producing for us helps to expand their bottom end line of heat sensors. This represents a 10 percent addition to their offering. The main customers for Vendor A is the Armed forces, who buy heat sensing devices for airplanes, tanks, and vision goggles for ground troops. They do not have the infrastructure to build a product such as ours. They would not take on the capital expense to enter this type of manufacturing. They do not have any retail, on-line, distribution experience, or presence. Vendor B who supplies us with the stainless steel blades are in a similar situation. Their main customer is the medical, surgical industry. Vendor B manufacturers high end surgical blades, knives, as well as blades for men’s razor blades. Our product represents a new product in between in quality. It is not significant enough for Vendor B to start an entirely new type of product for them
Threat from Substitutes
In the current market, there are threats from substitutes. People not using our product can use manual nail clippers, grinders, or pay someone else to trim their pets’ nails. The threat to us does not exist. All pet owners are currently using one of these venues today. With the quality, ease of use, time and money savings, and cruelty free aspect of our trimmer, virtually nobody will revert to these substitutes.
Before we risk our profits or our brand value, we took a critical look both internally, and externally. The intent is to consider how we can leverage the positives, improve on our weaknesses and prepare for outside threats. Here are the findings.
STRENGTHS *indicates core competency
Lack of training
Lack of Distribution network
Never advertised pet products
Pet ownership on steady rise
Personal time on decrease
Economy is increasing expendable income
Possible newer technology
Heat sensor supply issue
Financial health is one of our core competencies. We have a very low debt-to-equity ratio, combined with a credit rating. This gives us the flexibility to create initial inventory and cover the typical start-up costs related to a new product line. Brand reputation, another core competency, means that we are already in the homes of many of our targeted customers. They know we produce high quality, well designed, products. Our brand is a trusted name nationally. Efficient manufacturing is another of our strengths. It allows up to produce our goods at a lower total cost compared with competitors. We run our production lines quickly, with little waste, or re-work. This helps for reliable batch production, and very few quality / defects issues in the field.
Lack of training for our production line associates is a potential issue. Production will be slower, risks quality compliance, and will cost more per unit compared to our established lines. Lack of advertising relationships within the pet market is another weakness. We do not advertise at all aimed at pet owners. We do not understand what the costs are, compared to our other product lines. We will not be able to bundle the new lines advertising with our other lines, for a volume discount. Our sales force is not equipped to demonstrate our new product line. We will need to higher trainers, and new sales people that are specialists specific to the new line.
The economy is on an upward trend. As wages increase, so does expendable income. This allows people to purchase pets, supplies, and services. This applies for either new or existing pets in the household. Personal time is on the decrease. Wage earners are spending more time working. Parents are spending more time driving their school-aged children to sports, music lessons, and dance classes, etc. These parents will also attend the events surrounding the activities. Taking Fido to the groomer and picking him up later is another time eater. Being able to trim nails effortlessly, in your own home, on your own schedule has a good deal of appeal. Pet ownership is on the rise. In 2013, there were 82.5 million pet owners in the United States. This number is expected to rise to 92 million by 2018. In 2013 $4.4 billion dollars were spend on grooming and boarding. In 2014 sales rose to $4.7 billion, a 7% increase. This is a growth industry.
Economic downturn could become a possible threat. As expendable income dwindles, pet owners could potentially purchase less expensive nail trimmers. They could also choose to go to a groomer, but do so less often as a money saver. A supply issue could threaten our ability to produce our product. A shortage of the heat sensors could become an issue. If our vendor chooses to increase the price of the sensors could become an issue as well, reducing our margin to an unacceptable level. Development of a newer technology is a threat. A competitor, on a new company could start making the next generation of automatic trimmers. Dependent on the features, or price, we could lose market share.
Sell 100K units by 12/31/2016.
Achieve a profit of $500K by 12/31/2016.
Have our product on the shelves of 2 national chains, and in 200 independent retail pet supply stores by 9/15/2015. Have an on-line presence by 9/1/2015.
Our objective is to have 250K hits on you-tube demonstration by 1/1/2016 and 100K hits on our website specific to the new product line by 6/1/2016.
This section will introduce you to the particular strategies, which will assure that we achieve our objectives. You will find them well thought out and comprehensive. We took the necessary time to be confident that they are inter-related and logical, using previous tactics which have been successful here at Company G.
Packaging – use our trusted XG logo and recognized style of packaging. Great Warranty – offering a two-year warranty, this is better than current electric trimmers in the market. This is in line with our warranty for other product lines in our assortment. Dedicated Help Line – have a 24/7 help line specific to this product line. It will give advice, answer questions, and take care of issues that arise for customers.
Market Pricing – Skimming pricing of $89.99.
Good Terms – we will give 2% net 30 days pricing to our distributers. Advertising Allowances – $5 per unit sold for preapproved advertising campaigns. We will require proof of sales and give credit within 30 days of campaign end date/ Place Strategies
Retail Stores – 2 National chain stores and 200 local pet stores based on their sales. Web presence – We will sell through Amazon.com, as well as on our web site. Quick shipping – We are going to use Amazon’s distribution Centers to ship to retail stores and directly to customers. This will be the most efficient use of our finished goods inventory.
Personal selling – We will provide demonstrations at dog shows. Social media – We will have a You-tube presence, and a Face book presence. Discount / Donation – We will give customers a $5 discount and donate $5 to the Humane Society for the first 50K units sold.
Explanation of Strategies
These strategies are a combination of approaches. We are going to use our strong brand name and recognition to take advantage to the consumers’ trust. If they compare our product to Dremel or Oster’s trimmer, they will see we give them a superior warranty. We will get our product in front of millions of potential customers at dog shows. There are dog shows of various types happening every week across the United States. The retailers that we target will get good financial terms, along with our strong brand name. Our you-tube presentation will prove to customers just how easy and safe our trimmer is. We will also appeal to the good nature of pet owners will our donation to the Humane Society.
Tactics and Action Plan
In order to assure our success we need to put specific tactics in place. They need a due date and responsible party, so anyone in the process can see if we are adhering to our timeline. We know whom to ask about any given tactic as well.