1.0 Executive summary
Titan is an Australian company that deals with production of sports equipments. It offers the best sport equipment recognizing the market satisfaction. Its expertise is in innovation and improvement of sporting equipment. Titan has experimented on a new type of material and has recently made a breakthrough. The new design balls are made of new material and have a unique non -leak valve that guarantees that the balls will not leak for at least six months under normal use. The plan seeks to define how the organization can generate a significant increase in company’s sales as well as profit as compared to the previous years. The plan will give a highlight of the targeted gross margin and sales revenue for the next five years which will be presented later in this marketing plan. The targets will be attainable through aggressive marketing, teaming up with providers of new technology and partnering with other local and international companies to reduce unhealthy competition, reducing business risks and pricing strategies.
The reason for the choice of Titan Company is due to the potential in its introduction of the non-leak valves and new material balls. The innovative products offer great potential to revolutionize the sporting industry giving the company large market growth potential. The company Titan which is a wholly owned Australian factory based in Sydney was established in 1960 to contract manufacture high quality leather balls for multinational companies under various brand names. This company had no marketing function. In year 2000 Titan won 5years contract to supply soccer balls to the premier professional soccer in Australia .In the previous 3 years, thousands of soccer fans had watched professional prayers dribble and shoot Titan branded soccer balls on national television. Due to the growth of basketball and other sports in Australia, Titan experimented with a new type of material for its sports balls. The idea was to develop a revolutionalized material that is extremely natural, tacky and durable. Through a special process, its sports balls constructed from the new material had a natural feel of leather and tackiness that lasting twice as long as leather and rubber balls. The revolutionary product innovation that the company has adopted is likely to provide the company with numerous opportunities for the company to grow the company’s products market.
In order for the firm to attain and sustain a successful marketing campaign, the company must be able to identify who its customers are, the pricing strategies that is suitable for the company, besides other crucial factors. The need to design an extensive, market plan that is customer oriented stems from the obvious need of the organization to remain competitive in an ever-changing marketing environment. Collin et al (2009, p. 10) notes that the emergence of a series of dramatic and far reaching changes in the marketing environment as espoused in the increased consumer power and competition has made it necessary for companies to create viable marketing plans. The new innovative non-leak valve balls would appeal to the new consumers, who are argued to be more demanding, much less brand loyal, more discriminating and more likely and willing to complain. Coupled with the increased availability of information especially with the rise of the internet, the new consumer is able to get similar value at lower prices thereby resulting to a general rise in consumer power. Additionally, the new competitor environment has also experienced shifts that have created increased pressures on the firms such as the ever increasing paces of technologies creating new marketing channels, new delivery systems, and payment systems and so on. Other environmental factors such as the rise and fall of oil prices, terrorism, global economy crises, and the increased awareness of the dependence of the global economies are new realities that any firm must be aware of in order to survive in the market. Effective thinking about all the internal and external factors that may contribute to the delivery of customer value as firm remains competitive is a new reality that is dawning on many companies. Using a marketing plan enables the company’s management to think through all these issues and thereby provide more tenable marketing decisions. This is described as a logical sequence and series of activities leading to the setting of strategic planning objectives for an enterprise, and the formulation of strategic plans for achieving them (Eric, 2008, p. 25).
In order to gain information that is crucial in developing a marketing pan, it is crucial that marketing research is carried out. Marketing research is defined as the formalized methods of identifying and obtaining information on the existing and potential customers (Westwood, P. 32). According to the American Marketing Association, marketing research is now defined as the “function that links the consumer, customer and public to the marketer through information” (Diggines, 2010, p. 5). This information is used in identification and definition of marketing problems and opportunities. Marketing research consequently aid by specifying the information that is needed to address various problems. It is difficult to prepare the plan without knowledge of the potential consumers. Effective planning involves collection of information from various sources to enable the firm to make objective decisions based on timely and accurate information. Such sources of information include both primary and secondary sources of information. Primary sources of information include interviewing current and potential customers, interviewing potential customers, observation with an aim of answering a specific question at hand ( Jan, 2010, p. 41). Secondary sources including magazines on sports, census results on demographics, income patterns and economic and socio economic positions among others could also be collected from secondary sources. Collection of such type of information provides the organization with information that would guide the firm in strategy formulation and decision making. For Titan marketing plan, these tools were necessary.
Observation and experimental methods were used to identify the various attributes that would be desirable among consumers. Experimentation to identify the viability of the new balls and comparing the valves ability to hold pressure indicated that the Titan balls were of superior quality to other balls. In order to identify the products and the company’s strengths, weaknesses, opportunities and threats, experimentation, observation, interviews and use of both internal and external sources of information was necessary. Among the data that was used included data on the market potential obtained from various government and market watchers research information. Besides use of experimentation, more information was gained through use of surveys that involved giving questionnaires to respondents who had used the ball. These respondents were mostly players who were to differentiate the various aspects between the other balls and the titan balls. Other surveys aimed at identifying the price that individuals were willing to pay for the non leak valve balls. Such data that was collected is crucial in guiding the firm in its various strategies such as its pricing strategies.
Identification of the factors that motivate consumers to purchase a particular type of ball over the other would be helpful in deciding on the attributes that consumers would find attractive. Using online surveys, the research indicated that durability, tackiness and non leaking of the balls were critical factors that contributed to the purchase decision. Similar responses were identified among professional soccer players. The prices of the balls relative to competition and quality were also important factors in determining whether an individual who is a potential customer for the leather balls makes a step to buy the leather balls. The professional players, schools and teams were less price sensitive as compared to individual buyers. This was expected as business to business buyers are usually keener on other attributes other than price alone.
1.2 Summary of the research
The collected data include information that indicated that consumers would prefer the tacky balls to the less tacky balls besides preference for the new material that was as long lasting as leather balls. The data also indicated that most consumers would be willing to purchase the new balls at a price that was in between the leather balls and the rubber balls. Other information acquired from the primary and secondary research indicated that availability of new avenues of marketing channels such as the internet coupled with new ways of making payments would provide new opportunities for the growth in sales, and acquiring market intelligence.
2.0 Situation Analysis
Titan manufacturing company is growing its product base by introducing new innovative technology for production of various balls. The new technology helps in production of balls using new material that offer the advantage of remaining tacky for longer, containing a non-leak valve and lasting for longer than the rubber and leather balls. The company’s products have been received well in the market and marketing would be a critical factor in developing the market, increasing share of the market and creating and enhancing brand awareness and loyalty.
2.1. Market Summary
A study done in year 2000 shows that expenditure on sports equipment has risen to $3000000 in Perth only. We expect sales will increase steadily as participation in sports continues getting popular. The proximity of large cities around Perth will help to fuel our business. Due to many tourist attraction sites around Perth we also expect individuals from as far as S.America, Japan and Asia coming for recreation who will also be our potential buyers.
Direct mails and web market.
The current list of customers and web co-marketing will help to fuel our direct sales. More information about our products will pass through word of mouth, free banner exchange programs, printed catalogs and publications like magazines and outdoor adventures.
The main target markets are households, sporting clubs, schools and colleges. The expectations are that the sporting clubs will grow faster than the number of schools and colleges. We also believe that, the increased participation of households in sports will help to fuel the nurture new talents and hence growth in sports participation.
-The customers understands their needs and with brands of soccer balls like Puma, Prostar, Nike increasing their standards, people are becoming more conscious of picking highest quality and most modern balls
-They need a variety of colours and design and Titan’s new technology will not leave customers disappointed.
The market trends are in favor of Titan. The major trends are.
-Perth is booming as a vocation destination and recreation spot.
-At least one child in each household participates in one game
-According to the latest available studies, spending on recreation in Perth will grow by 26%
2.2 SWOT Analysis
This is the situation analysis and it captures the strengths, weaknesses, opportunities and threats that face Titan Company.
- The unique non leak valve that guarantees that the ball will not leak for six months under normal use
- They have a new technology that will take their competitors a number of years to copy
- Large, skilled and experienced management team
- The sports balls are made from a revolutionary material that is extremely natural, tacky and durable.
- The tackiness can last twice as long as the leather and rubber balls
- The balls can be made from varying designs and colors
- Titan has an efficient and effective research and development department
- The company can benefit from varying government support since its locally based
- The company counts all tourists and locals as potential customers
- Community commitment.
- The new balls cannot be used in competition due to absence of sponsorship contracts.
- There is high production cost as compared to rubber and leather balls
- The company suffers from insufficient sales force
- There is a large market unknown to competitors
- There is increased trend in sports participation by 10% for the last 10years
- The retail prices of these balls are as low as $40 which are less expensive as compared to the other types o balls from competitors
- The product is new and many would wish to have trial on it
- In the recent years there has been a decrease in internet communication and other means of marketing communication.
- High competition from multinational companies e.g. Spalding or molten
- The Product is new and hence sportsmen/women would shy away from trying it.
- The company is currently using unregistered trademark
Direct mail and web sales.
Spalding and molten which are multinational companies sell their sporting equipments to Titan target market .They have very powerful online and retail presence but fortunately they have not opened any retail stores in Perth. The main goals are to achieve 9% of their gross yearly through direct sales.
Nameless1-This is one of the toughest competitors which have already established themselves in the neighboring cities to Perth. Their retail shops are also strategically located along the Highways.80% of their products within this region resembles those of Titan
-Nameless2-They sell limited sports equipments, less promotion and they do not market their products extensively.
2.4 Product Offering
-The new material balls made from unique non-leak valve which guarantees that the ball will not leak for the next six months under normal use is the big money maker for Titan. This is a long term sales project that will rely on future catalog and word of mouth sales. The management plans to rely on the highly trained staffs and customers to limit the feedback loop in product and service offerings. The sports equipments will be delivered on demand using delivery vans
2.5 Keys to success
Titan Company focuses on two keys to success which can be categorized as
(a)External/Business environment factors
People in Australian region are now living in new interesting era where physical fitness has taken a center stage in their living style. It is evident that at least one person in the family engages in a particular type of game. This has brought about a change in customer profile bringing about a new market structure and a new company structure. Titan has also tried to establish relationships with government institutions, NGOs ,other companies/business partners as well as individual customer
The following are the basic internal factors for Titan
Key management team: Titan is confident with its right management team which has strong foundation in marketing, recreation and fitness skills, service delivery, accounting and finance.
High quality service and delivery: The Company believes that customers are critical to survival of this company. The company gives guarantee to every sale.
Selling and marketing power: The Company intends to demonstrate a successful approach to convert its reputation into an excellent brand .This is by using its intellectual property to create value for its client.
2.6 Critical issues
Implementation of the overall strategy effectively is a major concern to our company. The strategic element of this plan will depend on the management to follow through:-
- Encouragement of employees to think like owners
- Maximizing customer satisfaction
- Sticking to the budget
- Plough back profits for future growth
3.0 Marketing Strategies
The key to strategic positioning for the company is focus on delivery of innovative and superior value on crucial attributes including tackiness, pricing and longevity of its products while utilizing new channels of distribution to reach wider markets. Titan can cover over 50% of the market as its products are unique and deliver superior value to customers.
Titan’s mission is to offer individuals memorable porting experiences by providing innovative sports balls to the market. The company also works towards establishing long-term relationships with the customers and the employees. Emphasis will also be put to working within the community, promoting community service and encouraging education and training to the employees.
3.2 Marketing Objectives
- To acquire a 30%market share in Perth by the end of second year of its operation
- Maintain strong and consistent growth in sales over the next five years.
- Attain steady increase in the levels of market penetration for Titan balls.
- Increase the marketing channels to ease customer’s access to company’s products.
3.3 Financial objectives
- Maintaining year end minimum contribution margin of 35% to facilitate future product innovation and research.
- Maintain direct retail sales growth by a minimum of 15% per annum
- Increasing sales to achieve sales of $200000 in the first year
- Increase profit margin with increased market growth and penetration
3.4 Target Market
The market consists of households, sporting clubs, schools and colleges. The households make up the largest segment of our total market of our products followed by sporting clubs. This is as result of the new trend where participation in body fitness activities has intensified leading to every child in the household participating in at least one sport. This takes about 39.7% of our market share.The sporting clubs has also increased in the recent time as membership rising now and then. This takes about 36% of our total market.
Since the sports people are not satisfied with the current balls in the market, Titan offers a type from a revolutionalized material that is extremely natural, tacky and durable. The balls can also last twice as long as leather or rubber balls. In this regard the customers’ satisfaction will be put into maximum .
The company’s strategy is to create awareness among potential customers before embarking on a marketing campaign to drive penetration and growth in sales of titan balls.The message that the company will deliver to clients is that it offer superior non leak valves coupled with an innovative material that is more tacky and durable than the rubber and cheaper to the leather balls. In order to deliver the message to a wider audience, Titan will develop a company website that will also act as a source of collection of information on the company’s products as perceived by the customers.
3.7 Marketing mix strategy
Pricing strategy The pricing strategy will be based on the type of buyer and the type of leather ball. The balls will be priced lower than leather balls but higher than rubber balls.
Distribution. The company will use direct distribution for industrial and business consumers and sports specialty and other stores for the mass market.
Advertising and promotion. The company will use personal selling to reach the business consumers such as schools and teams and use of various media of advertising and promotions for the mass market.
Product design and development. Develop and make sports balls with wide range of designs and color, making balls from revolutionalized material that is extremely natural, tacky and durable and developing balls with unique non-leak valve that guarantees that the balls will not leak for at least six months
3.8 Marketing Research.
Informal research will take a center stage in our market research which includes customers comments, comments in the suggestion box by the employees. The company will also rely on research done by outside agencies who will be contracted when need be. Other observers will be hired who will help to observe the day to day activities of the company from a far distance.
The section provides financial overview of Titan related to the marketing activities. Titan manufacturing will address sales forecast, break-even analysis, and expense forecast besides indicating how they are linked to the marketing strategy.
4.1 Break even analysis
Monthly units Break-even 20000
Monthly Revenue $800000
Average Per unit Revenue $40
Average Per-unit Variable cost $0.75
Estimated Monthly Fixed cost $300000
4.2 Sales forecast
Titan feels that the sales forecast figures are attainable and largely conservative and are likely to rise with increased budgetary allocation. The sales forecast groups the sales expected into three distinct groups which are the basketball, baseball and others. This increases the functionality of the chart compared to using the customer categories.
Monthly sales forecast
The prices range from $40-$100
4.3 Expense Forecast
Expense forecast is used as a tool for providing indicators when correction mechanisms are required and are necessary for ensuring proper implementation of the plan besides ensuring that the departments are on target ( Hamper et al, 1990).
The expense forecast relies on a conservative inflation forecast of 5%per year minus a 2%diminishing cost allowance.
Monthly employees meetings will act as the control environment. In the meeting the following will be discussed:-promotional activities, the current marketing activities, sales and other improvement ideas. Each employee whether on full time basis or part-time basis, owner, or manager will facilitate these meetings on a rotation basis every month.
Marketing ideas will be implemented by individuals who have 99% believe in them else they will have little value if not implemented. Everyone in the company should feel part of the decision making process and in the long term success of the company.
5.1 Implementation tactics
- Delivery of daily news trial for legal and regulatory departments by the assigned person
- Meeting with department directors to promote plan including budget implications for department followings
- meeting with vendors to set up trials
- working with vendors and designate from each department to define profiles
- Scheduling meetings with all members of both departments to promote trials :sell concepts of customization following two weeks
- Launching trials
- Scheduling mid-trials meetings for feedback and refinement
- Assessing trial results
Increasing the number of internet training sessions by 10%
- The Assistant Human resource manager and Assistant IT department will complete this work by end of year one
- Review most frequent requests for help with internet and determine appropriate application for classes
- Contact consultants to design course on government sites
5.2 Marketing Organization
The company is a bit complex with a well laid down organizational structure. This helps to reduce barriers among the stakeholders and encourages teamwork to tackle quality products and services. The philosophy of Total Quality Management (TQM) encourages the workers to think like owners and the owners to think like workers.
5.3 Contingency planning.
There are several unexpected worst events the company has planned for
- The Building structure doesn’t meet a city code
- Competitors come up with a similar invention
- The loan funding falls through
- Competition from similar products and services from their competitors
Finding that the business may not be able to sustain itself as a going concern
Increased possibility of liquidation so as to settle liabilities where sales and returns do not meet the growing liabilities.
- Work with contractors who are knowledgeable with city regulations concerning building structures
- Patenting our new trademark
- Funding from other sources including capitalists
- Aggressive promotion and advertisement campaign