What Attracts Customers to Online Stores - Example

Assessment 1: Develop marketing Strategies Name Class Unit Table of Contents Table of Contents 2 Organisational overview 2 Objectives 3 Current size, capabilities and resources 3 Gaps between objectives and current capabilities and resources 4 Opportunities 5 Marketing mix strategy 6 Product 6 Place 6 Price 6 Promotion 6 Tactics 7 References 8 Opportunities 11 Organisational overview Through the analysis of Houzit vision and mission, it is possible to identify the organisation strategic directions. The firm has been able to establish itself as a national retail brand through offering their customers unique and high quality home ware. Based on Houzit mission, the organisation has been seeking to increase its business through increasing their presence in Australian major towns. The firm have been focusing on three main areas; quality, uniqueness and selection. Strategic direction acts as a roadmap for the organisation in attaining their goals. Through the strategic direction, Houzit has been able to determine its objectives and come up with ways of attaining them. Objectives To increase the organisation sales from $15 million annually to $20 million annually for the next three years. Increase the number of loyal customers from 10,000 to 15,000. Enhance Houzit brand recognition in Brisbane so that a third of respondents can recognise the brand in accordance with a survey to be taken in the next 18 months. Current size, capabilities and resources Houzit current size of their stores ranges from 1000-1500M2 and each of individual stores have capability to generate sales breakup as listed below: Bedroom furntitures-35% Bathroom fittings-30% Mirrors and decorative items-20% Lighting fixture-15% Houzit has 15 to 20 fulltime employees in addition to casual workers. The organisation has been able to open 15 stores which are in Brisbane area with their headquarters in Milton. The organisation strengths lie on having skilled workers who are motivated and experienced in the field of home wares. Houzit also benefits from having a great retail space which fits well in the commercial urban district, loyal customers and variety of assortments. In fact, Houzit product offerings exceed those of the competitors both in range and quality. Despite this, Houzit have several weaknesses which includes limited budget for marketing and problems caused by inability to fund long term payments plans by customers. Gaps between objectives and current capabilities and resources Houzit have not been able to reach all areas in Australia. At the moment, the outlet is only in Brisbane with no interstate outlets which hampers the objective to attain 1000 stores Australia wide. Despite the aim to increase the organisation sales by 20,000 annually, the organisation has only been able to attain 15,000 annually. The organisation has not been able to increase customer loyalty to 15,000 as per the objectives and lags at 10,000. Lastly, Houzit has a gap in increasing brand recognition to a third and the survey is yet to be conducted. Opportunities Based on analysis, the best opportunity for Houzit is use of online stores. As a marketing manager, the benefits that can be obtained through use of online store can help the organisation attain the objectives (Reibstein, 2002). Marketing mix strategy Product Products refer to what the business is offering for sale (Van Waterschoot & Van den Bulte, 1992). In this case, Houzit ensures that their products have the best quality, features and are able to meet the customer needs. Houzit has been offering after sale service which they should continue offering. Place This refers to distribution network, store location and other means used to get the product to the customer (Van Waterschoot & Van den Bulte, 1992). Through online stores, it will be possible to sell directly to the customers. There are lot efforts to open branches Australia wide. Price Houzit has been setting affordable prices for their customers. The organisation has come up with easy payment plan. The organisation should set their price based on the level of competition. Promotion This involves communicating to the customers on the products benefits. Houzit will utilise social media, direct marketing and advertising to reach more potential customers. With the use of online store, internet offers a lot of opportunities for promoting the product. Using the value chain analysis, it is possible to carry out a marketing performance review for Houzit. This includes looking for a range of activities such as design, production, distribution and marketing. To come up with the best final products this includes the bathroom fittings, bedroom fittings, mirrors and decorative items. The organisation has been using the best raw materials to come up with products which help in meeting the business objectives. To access the market performance, the metrics to be used are; return on marketing investment (ROMI) and Return on Investment (ROI). The two metrics will make it possible to allocate marketing investments adequately. Tactics Houzit should implement the strategy utilising following tactics: costing, accountabilities, responsibilities and a plan to monitor the activities including the KPIs. The organisation should monitor pricing for the raw materials from the source up to the final product. The management should take full responsibility and empower their workers for the strategy to succeed. The metrics should be monitored based on set results. With venture into online store, the organisation may face ethical issues due to privacy concerns. The organisation must be ready to address the ethical and legal challenges associated with data privacy. This is through use of data protection and utilising privacy policies (Reibstein, 2002). Based on Houzit resources and capabilities, it is possible to implement the tactics. References Reibstein, D. J. (2002). What attracts customers to online stores, and what keeps them coming back?. Journal of the academy of Marketing Science, 30(4), 465. Van Waterschoot, W., & Van den Bulte, C. (1992). The 4P classification of the marketing mix revisited. The Journal of Marketing, 83-93. Assessment 2: Marketing plan Table of Contents Table of Contents 2 Organisational overview 2 Objectives 3 Current size, capabilities and resources 3 Gaps between objectives and current capabilities and resources 4 Opportunities 5 Marketing mix strategy 6 Product 6 Place 6 Price 6 Promotion 6 Tactics 7 References 8 Opportunities 11 Executive summary Houzit will be acting as a national retail brand through provision of a range of quality home wares. The organisation will be ensuring that the provided wares are unique and of high quality and paid through a flexible plan. The organisation mission is to have outlets in entire Australia by 2020 beginning with 20 stores in Brisbane and expanding to 100 stores nationally. The organisation aims to open an online store that will enhance their market reach in Australia. In addition, the online store will offer all services which are offered by physical stores in Brisbane. Through engaging an experienced website designing company, Houzit will be able to design a website that can withstand privacy breach. It will also ensure customer data privacy. Swot analysis Strengths Highly skilled labour that have adequate experience in home ware. Functional and efficient retail space which is located in the commercial urban district. High number of loyal customers and an advantage of repeat purchases. Wide range of product offerings which goes beyond what is offered by the competitors. The firm have the ability to offer better quality products than the competitors. Weakness The organisation has budget constraints which makes it hard to develop brand awareness. There is lack of critical mass. There are challenges in funding the long term repayment plans which some of the customers utilise. Opportunities The rise of online shops that can be used by Houzit as they look for a large market. Online shops require less capital to set up than the physical stores and have a wider reach to the target market. The rise of social media marketing is a great opportunity for the business especially due to viral marketing. This is through use of tools such as Facebook, twitter and blogs. Houzit have not fully exploited Australian market. This is a large growth area that the firm can rely on. There is an increase in the market outside Brisbane that the firm should focus on. Threats There is high competition from the local retailers which can lead to low prices. This is especially with the retailers who have low overhead cost than Houzit. Competition from the national house ware chains operating in the region. Threat of economic crashes which reduce the level of disposable income. Marketing objectives The business objectives are; To increase sales from current $15 million annually to $20 million annually in a period of three years. To increase the number of loyal customers from t10, 000 to 15,000. Enhance brand recognition in Brisbane so that a third of respondent in a survey to be taken in 18 months’ time recognises the brand. Strategies To meet the objectives, Houzit will create an online store and utilise internet marketing. The business will be able to reach a large market at a lower cost. Based on the marketing mix, Houzit will strategies a plan that will enable them reach a wider segment. This is through price, place, promotion and product. Online stores are easy to set up and are easy to run (Reibstein, 2002). Based on SWOT analysis and gaps identified, it is clear that Houzit lacks adequate coverage in Australia. This will only be attained through coming up with the best mechanism to attain the largest market share. The outlets are only in Brisbane and the firm requires expanding to other parts in Australia. Also, the organisation has not attained brand loyalty which can be easily attained through internet. The organisation will utilise privacy policy and software that will ensure that the customers’ data is safe. Implementation of tactics Houzit will be utilising costing, accountabilities, responsibilities and a plan which will monitor activities including the KPIs. Costing will be carried out throughout the process of coming up with the online shop and sourcing the raw materials. This will give the organisation a competitive edge in the business. The management will be taking full responsibility for the development of the online platform and involve workers. This is based on an inclusive approach to the strategy. In addition, KPIs will be continuously monitored in entire process. Ethical and legal issues that occur on online shops will be addressed. This will involve utilising the available resources to come up with an efficient platform. This will include design of safe and secure online platform utilising the best designers. The implementation of online stores will be used to gain more customers (Reibstein, 2002). Reference Reibstein, D. J. (2002). What attracts customers to online stores, and what keeps them coming back?. Journal of the academy of Marketing Science, 30(4), 465. Read More