Market Planning Essay Example for Free

Market Planning EssayAnalysis1. cornerstoneIn 2001, Doole and Lowe defined the international commercialiseing. In a simple shape, international commercialiseing involves the firm in musical modeing one or more commercializeing mix decisions across national boundaries. And in a complex class, it involves the firm in establishing manufacturing facilities all all overseas and coordinating merchandiseing strategies across the globe (Doole Lowe, 2001). And Chong and Kasturiratne said that, the gentleman of marketing is a dynamic and very exciting one where decision making is at the nitty-gritty of the marketing process. New markets atomic number 18 opening and old markets ar evolving, deliverance with them rude(a) competitors but a akin alto compassheriances (Chong Kasturiratn, 2009).2.1 Primark BackgroundPrimark is an interesting, amazing and growing conjunction that gives customers with rugged- constitute behavior habit. It has a supply chain, which is very effective. The drudgery link in chinawargon, India, Turkey, Bangladesh and other countries, with retail outlets in Ireland, the UK and other parts of Europe (Businesscasestudies, 2011). Primark is a world(a) garment retailer found in June 1969, and in Mary Street, Dublin, the first Penneys enclose opened. The under bring abouted focal ratio is fast, from 1969 to 2012, thither are 38 stores in Ireland, 35 stores in Spain, 161 stores in UK, 4 stores in Netherlands, 6 stores in Portugal, 9 stores in Germany, 1 store in Belgium and 2stores in Austria. In total, in that respect are 256 stores all over the world (Primark, 2012).The slogan of Primark is style, quality and affordable scathes all rolled into one at Primark. And the key principle of Primark is to provide the consumers with clinical depression-coat modal value items. The target consumer is the deal who has hammer thinking and want to return money. By using the way of sourcing productions efficiently, making articl e of clothing with easy design, using local raw material, paid attention to the mass size and speeding less on advertisement, the operating of Primark is efficient.1.2 Chinese fast fashion tally to Barnes and Lea-Greenwood, fast fashion is a kind of marketing scheme. When the demand of consumers touches a crystallise value, to live up to this peak, the purpose of fast fashion is to reduce involved processes in the vitiateing cycle and save time for delivering crude fashion productions into stores (Barnes Lea-Greenwood, 2006). In recent times, fast fashion developed very fast, it become an rising market for the whole world, In chinaware, Fast Fashion scrapes are now learning that the speed of bringing a new style to market is secondary to the speed of reaching the market at all (Poleg, 2012).2. Analysis2.1 PEST summaryIf an organization want to enter a new market, before the fount of the process, PEST abbreviation is very primary(prenominal). The PEST analysis is an ef ficient tool to understand the market. The factors include semipolitical, sparing, social-cultural, and technological. governmental The political factor has a big make for on the business. In the family of 2012, the political surround is stable, though it is the time that Chinas leader go out change from Jintao Hu to Jinping Xi. As one of Chinas fundamental political system, the multi-party cooperation system identifies the status and functions of the CPC and the eight other political parties in the political life of the state, and the relations between the parties (U.S. give in Department, 2012). And the Chinese government consists of a system of multi-party cooperation and political extension under the leadership of the CPC. The system ensures that the CPC is the only party in agent in the Peoples Re universal of China (Fogel, 2010). So even though the leader changed, the policy pass on change limited in the future.And at the identical year, the Chinese government has p ut forward the 12th five year plan. In the ordinal chapter, on that point is a plan to improve the level of opening up, in order to defy a win-win situation. That policy may be grievous for Primarks immersion to capital of Red Chinas market. Economic In recent years, as the result of advantageful economic reform and nimble marketing system, capital of Red Chinas rag trade is becoming prosperous. GDP is becoming risqueer and gamyer, so the consumer awareness of people who liveness in capital of Red China is stronger than the past time. Rag trade in the capital of Red China is a big market ranked thirty-sixth (Wang Zhao, 2012). With the reform and open and the developing of economics, china is the biggest clothing pains and stake increment all over the world. Beijing is a city of big intent of totals and go for clothing, there is more than 60 percent distant clothing investment in Beijing. According to the Beijing statistical bureaus data, in the year of 2011, the d isposable income of each Beijing resident is change magnitude 13.2 percent, consumer spending of each is increased 10.3 percent.And for the clothing spending is increased 8.5 percent, which occupy the whole spending 10.3 percent. Last year, the spending on clothing is 46.92 jillion. And it occupies 22.6 percent for the last year in the shopping mall (Beijing business cultivation consultation center, 2012). And for the economic growing, it is do a high speed of Chinas developing in the past 10 years. GDP is 47156.4 billion, it increased 9.2 percent, and the expert forecast the date will be increased more than 12%. Chinas clothing market is very huge, in the year of 2011, the sales volume of multinational clothing corporation is 5700 million, and the sales volume of shopping center is 2340 million (We the financial channel, 2012). Economic globalization has become the trend of world economic development. In the year of 2012, there are 1419 new contradictory investments develop been approved in Beijing. The growth year-on-year is 3.73%.The total investment of new established enterprise is 4.109 billion dollars, and the growth year-on-year is 92.05% (China industry research, 2012). Social Beijing is the capital of China, so Beijing is the center of political, horticulture, science and technology, and discretion activity. The culture of clothing has a long history in here, there is strength in the culture deposits and arts and humanities. At the same time, Beijing is the center of national minority, it stern sufficiently shows the glamour of brand. Beijing is the economical center of northern part of China, there is a vast potential for future development. Nowadays, the developing speed of Beijings economic is very fast, fol pocket-sizeed, the values and taste are changed, too. The demand of new clothing, new brand, and new style is the key point. on that point is a big latent acquire power on the people who come from other places. After reform and open up, people travel to Beijing, people work in Beijing, people sterilizetle in Beijing. world-wide stars, HK, Macao and Taiwan compatriots, artists, and famous people, they all alike to go to Beijing. All of these make a good foundation for the clothing development. As the capital of China, Beijing is the center of international communication. on that point are a large number of embassies, trade delegations, and foreign institutions. A lot of meetings in Beijing, China International Clothing and Accessories Fair are now the largest fashion light in China and it stands for the authority level in China.The clothing market in Beijing contains top grade brand shopping mall, brand shop, boutique, exclusive shop, and supermarket, all of these make a system that good for new brand located. Technological In Beijing, people can easy to get information and there is strength for the textile industryupdate the technology and imported technology is convenience. So Beijings rag trade can follo w the international fashion. The development of high technology makes Beijings market climb a high level. And there are some top-ranking clothing universities in Beijing, such as Beijing Institute of Fashion, Tsinghua University and China Academy of Art, and so on. There are 10 universities railion on clothing, they make high level talents for design, management and sales, which improve the Beijings rag trade.2.2 Michael gatekeeper Five Forces AnalysisSuppliers bargaining power A producing industry requires raw materials-labor, components, and other supplies. This requirement leads to purchaser-supplier family between the industry and the firms that provide it the raw materials used to create products. Suppliers, if powerful, can exert an influence on the producing industry (Quick MBA, 2010). As we mentioned in the Primark background, the first supplier is China, the reasonable forward integration threat by suppliers, suppliers concentrated, significant cost to switch supplier s and customers powerful make the suppliers are powerful. Primark sell in bulk, and countenance a mandatory requirement. Primarks Supplier Code of Conduct is a mandatory requirement within which its suppliers work. It incorporates the United Nations Charter, Chapter IX, phrase 55 and is subject to strict and ongoing audits conducted by third parties (Primark, 2012).Primark takes this Code of Conduct very bad and its management board reviews it regularly. But there is exiting a problem, which is the change magnitude cost of raw material. Because of the decreasing cotton plant cultivation makes the cotton bell increased in China. So Primark should hire attention to the relationship with suppliers caused by monetary value increasing. Buyer bargaining power Buyer assiduity versus firm concentration refers to the extent of concentration in the buyers industry compared to the extent of concentration in business. The more concentrated the buyers industry relative to business the gr eater the bargaining power of buyers (Lima, 2006). By the late 90s, Chinese rag trade stepped into the buyers market. There is no definite brand and pose, the increasing of productive power is faster than the increasing of order criterion.The competitors always win by low-cost. And for the targeting pigeonholing of Primark is youthful people, there are a few buyers with significant market share and they possess a credible backward integration threat, so the bargaining power of consumers is high. Potential new entrants The rag trade has low barriers to entry, and in theory, any form should be able to enter and exit a market, and if free entry and exit exists, and then profits always should be nominal (Quick MBA, 2010). So, although the rag trade is easy to enter, there is exiting so many competitors. If Primark want to get the profits, it should pull in its own characteristics and build its own brand name. resembling Lima said Brand identity is the extent to which buyers take the brand name into account when making purchase decisions (Lima, 2006).Threat of Substitutes In ostiarys model, threat of substitutes is caused by the products in other industries. The price change of the substitutes can affect the products demand. But clothing is essential for people, it is difficult to pay off a substitute for clothing. But the consumers in current time, the function of clothing is not only unplowed warm, but also to follow fashion. So some consumer changes their attention to cosmetic and jewelry. Therefore, the threat of substitutes is high The challenger among competing sellers Primarks main competitors are HM, ZARA, GAP, UNIQLO and other fast fashion brand. From a macroscopic analysis, there is no dissimilar between the competitors. But from the microcosmic, the price strategy of low-cost is an advantage point. So the threat of competitors is high and fierce. When Primark panorama to the competitors, it should improve the product differentiation, creative ly use a distribution channel and improve the relationship with suppliers.2.3 SWOT analysisA scan of the internal and external environment is an important part of the strategic planning process. Environmental factors internal to the firm usually can be classified as strengths (S) or weaknesses (W), and those external to the form can be classified as opportunities (O) or threats (T). Such an analysis is referred to as a SWOT analysis (Quick MBA, 2010). Strengths Primark has confirmed the market of goal and brand name. It comes from Europe and it is easy to develop in Beijing. And the style of clothing is prevailing with low price. It is easy to find factory to produce productions. The brand is fits for the youth to follow fashion and fits for their purchasing power.And it has a good industry chain. Weakness Primark does not well-known(prenominal) with the market in Beijing, and Chinese consumer does not know the brand. Other fast fashion installtle in Beijing early, and they occupy the market. Opportunities There will be plenty of space for new brand to grow. There is a high purchasing power in Beijings market. The education of Beijing is high and people can accept new things. Threats The culture, policy and human are totally different from Europe, these make difficult to entry. And some competitors have settled in Beijing a few years age, how to soak up consumers and how to build brand name is the first problem.-dodge Development2 STP AnalysisIn the marketing theory, segmentation, targeting and positioning are the factors of company marketing strategies. When Primark enters Beijings market, it will face to thousands of consumers. The consumer psychology, consumption habit and income level are different. By analysis the strategies factors, we can know which way fits for the Primark in Beijing.3.1 sectionGeographical factorsIn Beijings market, we divide the geographical factors into both parts, one is city consumer, and some other is rural consumer. For th e city consumer, they need the clothing style full of modern and the productions can follow the fashion trend. For the rural consumer, they focus on the practicability of the productions, and pay less attention to the appearance.Demographic factorsA).Gender The demand for clothing is different between men and women, women have a high demand for the appearance of the clothing, and men pay attention to the style and practicability. B).Age Different age stay in the different level. The young people and students in school are the main consumer group. Based on some researches, the people whose age between 18 and 35 is a big consumer group, they hold the 50% of the clothing market, and there are only 19% held by the age of 40. The young people is the leading group for the fast fashion, different consumer group has its different consumption level. At present, the consumer of high-end expensive and of high quality is 0.6% for the Beijings market. And middle class is 70-75% (EFU, 2012). ment al factorsIn Beijings market, we divide the psychological factors into five parts. Price For this group, the first consideration is price. The income drives the purchasing power. Quality The consumers pay attention to the quality of the clothing, hats, shoes or bags. Service This group pays attention to the pre-sale returns and after-sale services. They need high service system. Fashion The consumers love to follow the fashion trend and the renewal and surrogate is fast. Luxurious They pursue the highest price, and they need satisfaction from shopping.Behavior factorsFor the confirmedly brand buyer, they only buy one brand, neer considering to buy other brand, the purchasing pattern is A.A.A.A.A.A. For the middle brand buyer, they will buy the production from several(prenominal) brands, the purchasing pattern is A.A.B.B.A.A. For the shift brand buyer, they change their mind from one brand to another(prenominal), it means they have no loyalty for one brand, the purchasing pattern is A.A.A.B.B.B. For the no loyal brand buyer, they do not have the favorite brand and do not care the brand, the purchasing pattern is A.C.E.B.D.B.3.2 TargetingAfter analysis the Segmentation, The target group of Primark is the young people who have higher education in Beijing, because the characteristic of this group is the convergence of purchasing. They may be come from different city, have different personality, but they are in the golden age, they listen to the same music, watch the same movie. Especially the developed internet, they can get the information and then synchronization with the world. So it makes Primark to choose the undifferentiated marketing. Primark enters Beijings market, it can use the same production, the same price and the same selling way, but it should make a new business strategy to Beijings consumer.3.3 PositioningWhen Primark enters Beijing, the first consideration of position is competitors. The tentative competitors in Beijing are HM, ZARA, GAP and U NIQLO.Product- positioning map 1In fact, the productions of Primark have a competitive advantage on the price, but it will lose in the popularity of brand. Therefore we should pay attention to build the brand name. past the Primark can attract more potential consumers (middle shift brand buyer). High popularity with low priceProduct- positioning map 2For the entering of Beijing, one thing is difficult to change, that is equipment. The quality level is similar, and then Primark moldiness put itself into a high service. As known, the shop of fast fashion is self-service just like supermarket. So Primark should improve service and then establish a good presence in Beijings market. Primarks clothing is full of British style, the selling point is designed in British, and then the brand value in Beijing could be higher than the value in UK. And based on the price in the UK, Primarks strategic positioning is middle class in Beijing. The middle class can help Primark to establish brand im age and keep it have a long future.3 intromission modes analysisWhen a company entry a new market, there are two major modes they are equity mode and non-equity mode. The equity mode comprises joint venture and wholly owned subsidiaries, and non-equity mode comprises export and licensing. And the main purpose of each company is to establish itself in the aim market (Zekiri, 2012). According to Charles, no matter which entry mode the company chooses, it has implications for how lots resources the company must enthrone to its foreign operations, the jeopardy that the company must take, and the degree of control that the company can exercise over the operations on the new market (Charles, et al., 2011). The following tables will analysis the four entry way, and the factors that influence the entry mode, then we will know which way should chosen by Primark.ExportingLicensingJoint Ventures contract InvestmentFactors that influence the entry modeBased on above analysis, we can see the country risk is low in Beijings market, and the polity and economy are stable belatedly in China, for these factories, exporting and Joint Ventures do not fit for Primarks entry. Furthermore, Primark in the UKs market, brand name has been built. It owns a lot of consumers not only in UK, but also in Europe. So the international experience is experienced. Finally, for the reason of big firm resources, experience abroad, low local market risk and a little intensity of the competition, it seems the most adapted for Primark entering in Beijing is direct investment. The direct investment, it may bring pressure to the investment and the company may take more risk. But the cost of the clothing is low, and the labor cost in China is lower than UK. The productions of Primark follow the fashion trends, which need the company uses the short time to produce, transport, and product release in the first time. Building the factory in Beijing can satisfy the need of market. At the same time, Pri mark can catch the Beijings fashion trend, which makes the production diversification.IMPLEMENTATION5. 7P marketing mixBooms and Bitner suggested that adding three factories in the marketing theory of 4Ps in the year of 1981 (MATT, 2012), the three factories are People, Process and Physical Evidence. In this section, we will use the marketing theory of 7Ps to analysis the implementation of Primark.5.1 ProductThe marketing theory of 4Ps is leaded by the product, and Primark do well in product, there are two aspects to show the Primarks product structure. A) From Primarks website (2012) we know, there are three clothing style in Primark, they are menswear, womenswear and childrenswear. The womenswear include four branches, the first is atmosphere, which is high fashion clothing for women, with a focus on key fashion trends, classic casuals, accessories and footwear the second is DENIM, which contain all the fashion style of pants the third one is secret possessions, which is a branch to Primarks underwear for women, from underclothes multipacks, to individual items and nightwear and the fourth one is backswing, which is a sports branch with the emphasis on technical functionality.According to the Primarks website (2012), the style for men is enough to male consumer. Primark has the clothing style for all occasions, consumer can buy everything from the formal one to the casual one. All of these make the Primarks product structure complete, give a lot of choice for different consumer, and let each consumer have a good shopping experience. B) The quantity of each clothing is every huge, as Primark said we buy and sell in bulk Primark has over 230 stores in Ireland, the United Kingdom, The Netherlands, Spain, Germany, Portugal and Belgium. The huge quantity satisfies the demand from the new market.5.2 PriceThe strategy Primark used is low cost strategy. The target group is young people with higher education, their age between from 18 to 35. They have the purchasin g power for the fashion trend, but they do not have the power to purchase the luxury. So the price can satisfy the demand of this group. When Primark entry Beijing market, it will use the same price strategy. As Zollinger said prices that already exist in the subjective memory of consumers (Zollinger, 2011). When a consumer choose a goods, if the performance, appearance and value are similar, one factor should considered by the consumer is the price. For long term thinking, the price is interrelated with sales. The low price could be got a higher level of the sales in the new market and if the sales have risen, it can drive the financial income increase the competition will face the uncompromising market the low price discourages the potential competition and finally market does not allow a high price in the same level (Danciu, 2001).5.3 Promotion and PlaceWhen a company entries a new market, an important point is promotion. There are 5 aspects of promotion. They are advertising, personal selling, sales promotion, public relations and direct marketing. But in fact, according to Primarks website (2012), it said that Primark has no advertising costs, or else relying on their customers advertising on mouth (word of mouth) about their products. But the competitors like HM, GAP and UNIQLO pay much attention to the advertising and designing. There are three main ways of Primarks communications. The first is mentioned in the website word of mouth. The second is the product structure of Primark, which is the fashion design, diverse style with low price to attract the consumer. The third is the geographical position. Primark always set the shop in the city center or the lively shopping mall.Although the rental cost is much higher than other competitors, Primark always give consumer a good shopping experience. However the shopping experience is different from Europe to China. Advertisements surround Chinese all over they go. Based on my personal experience, a good advertisement will attract me to try new product. According to Carl Hose, the purpose of advertisement is to sell the product.It is a communication of one-way form from company to consumer, and it will give consumers the important information to make a buying decision and attracting new consumers. It tells consumers about the products and how to get it. The purpose of advertising is to sell products and to build brand name (Carl Hose, Demand Media, 2011). Consequently, when Primark entry Beijings market, it need advertising to build the brand name at first time, and then it can use the promotion used in Europe. At the same time, Primark should keep the low price strategy and set the shop in the city center.5.4 PeopleWhen Primark entry to Beijings market, if it wants to move forward, the management should knows what has to be achieved, departments should know their role and stuff should know their goals. And they all should know what the consumers need. For Primark, it should hire th e people who study abroad. Because they are familiar the behavior and thinking mode of Chinese cultural tradition, they can easily communicate and get together with the stuff, and make the management more effective. At the same time, the hired people got the western educations, they understand the western way of dealing problems and behaviors, and they can understand and implement foreign bosss management concept. So, these people have important function to deal the culture conflict, promotion to cooperate effectively (Sun, 2010).5.5 Process and Physical EvidenceThe service is an essential point for the Primark entry the new market. It can build the brand name, at the same time, it can keep the consumers. Like James A Karl said that service good in an operation will greatly help in attracting new customers and the amazing consumer service can keep the consumer coming back. This is therefore a fact because people like to do business with the people who they trust and had a good exp erience (Karl, 2007).Conclusion and Critical Reflection6. Conclusion and critical reflectionAfter the Pestle and Porter five forces analysis in the first section, Primark seems to ready to entry Beijings market. But no one can predict the future and the condition of Beijings market is changing every time. For entry, the strong new market can help Primark to develop itself, at the same time, the new market may be weaken the brand name of Primark. Though the situation is good for Primarks entry, it is an armchair strategist. There are so many problems we cannot consider, such as financial crisis, the changing of price and the changing of permutation rate. Primarks strategy positioning is middle class in Beijing, and the target group is the people who have higher education, using the direct investment with low cost strategy. But the strategy cannot force the competitors, the success of Primark in Europe is decided by the strategy used in the UKs market, and Primark has experience to f ace the competitors, but Chinese condition is different from Europe.Another problem is the cognize of price in China, Chinese always think the high price is equal to high quality, and low price is equal to low quality. So the effectiveness of low price strategy is worrying. And there are two problems we should consider, one is money, another is store. Because the direct investment, it will cost a large number of money. And the store should build in bustling street, but the Beijings bustling shopping mall seems in a situation of saturated. When Primark set in Beijings market, the 7P analysis is a basic for implementation. But the development of Primark should change the caprice with the changing of each factor from 7P. When Primark face to the new market, the new policy, the new consumers, all the analysis employ in idle theorizing.ReferenceBarnes, L. Lea-Greenwood, G., (2006). Fast fashioning the supply chain shaping. Journal of Fashion market and Management, 3 10, pp. 259-271.B eijing business information consultation center, (2012). The 2011 Beijing clothing market scale, expanding department store is still the main channel clothing sales. 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