Marketing Plan Star Inc.

Marketing Plan Star Inc. Executive Summary This paper provides the marketing plan for the Star Inc. that outlines the entry strategy into the growing market for its deluxe travel bags and accessories. The Star Inc. intends to introduce a new brand of luxury products namely travel bags and accessories.Advertising We will write a custom essay sample on Marketing Plan: Star Inc. specifically for you for only $16.05 $11/page Learn More As a company that offers luxury products such as smart watches, bracelets, clothing, and footwear, the company intends to add the travel bags and accessories following an extensive market research. The survey reveals an increased demand for the superior luxury products that have also shown improved satisfaction amongst the consumers. To fill this market gap, the company intends to implement a careful entry strategy through market description, situation, SWOT, and competitor analysis before introducing the new products. Market Description The luxury indust ry is characterised by aspects such as historic heritage of artistic tradition, exclusiveness, brand image, and style (Kapferer 2012). The Star Inc. is identified through its deluxe lifestyle products that are uniquely designed to ensure consumer satisfaction. For a new brand to enter the luxury product market, a thorough research on the consumer’s demographic and psychographic characteristics is necessary. There is a need to identify the targeted market segment and develop apt product distribution channels for efficient customer satisfaction. The industry is deemed competitive, especially with the increasing rise of middle class populations in emerging economies such as Brazil and China (Veg-Sala Roux 2014). As many people join the middle class status, the demand for luxury products to manifest their status quo increases.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Th is trend has seen new entrants into the luxury industry in a bid to seize the growing markets. The Star Inc. prospects to enter the market with robust and specially calculated strategies in a bid to capture the market in a unique and sustainable way. Some of the products that are offered in the luxury industry include wristwatches, bags, outfit, shoes, jewels, and accessories among others (Park 2014). Situation Analysis Current Market Situation Having identified an increasing international demand for premium and classic bags by the upper class and upper middle-class income earners, the enterprise is top-gear to venture into the luxury market niche. An intensive market survey has provided credible information on the spending behaviour and trending culture of the international travellers. It has been identified that only few manufacturers are operating in this segment. Demographic survey also indicates that the number of consumers entering the upper class is increasing due to the prev ailing healthy global economy, which is anticipated to persist in the next five year. In the wake of the millennium development goals projection and vision 2050, many national economies have laid down strategic plans with a view of achieving increasing their revenues (Tsai Eisingerich 2010). As the global economy grows bigger and healthier, the probability of increased disposable income scaling upwards remains optimistically high. The enterprise targets this anticipated growth. Luxury bags and accessories have not been offered sufficiently on a global scale.Advertising We will write a custom essay sample on Marketing Plan: Star Inc. specifically for you for only $16.05 $11/page Learn More The company also targets countries with emerging economies in Asian such as China, whose economy has been described as rapidly growing. The portion of the population joining the upper class will be rising in the near future. Therefore, they will require high-end luxury pr oducts to match their new class and manifest their status quo (Kuksov Xie 2012). With only few companies in the luxury industry, the Star Inc. will focus on entering the luxury product market, as it stands promising. Target Market The analysis of the current target markets focuses on assessing the demographic, geographic, psychographic, and product usage characteristics of the prospective market niche for Star Inc.’s deluxe products. In addition, the analysis aims at carefully evaluating the current customer needs and anticipated changes in the target markets. The market analysis is highly significant since it will help the firm to establish the customer expectations and needs; hence, it will guide the firm to align the production specifications with the market needs with a goal of meeting the customers’ needs satisfactorily. The Star Inc. will also focus on the growing upper middle class and the upper class of emerging economies as they continue to seek high-end sump tuous products. The products mostly target international travellers from the emerging economies as well as rich people, especially from Western and Eastern Europe. The Star Inc. will concentrate on positioning itself within the luxury market of specialty retailing. The global luxury market has doubled in the past two decade to almost $320 billion annually in retail value (Kuksov Xie 2012).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Furthermore, industry analysts envisage that the market growth will remain consistent at an average rate of 9-11% per year, especially in the United States, Japan, and China. Substantial evidence reveals that luxury is no longer reserved for the spoiled rich, rather the middle class that is ready to pay a premium for the thrill owing to the splendid aspect of the lavish products that brings a special meaning to them. For instance, luxury houses such as Cartier and Chanel have ventured into this market by extending their product lines to cater for the aspirations of the middle class. The Star Inc. intends to offer its products at multiple price points to allow the brand to reach a wider demographic region as compared to other luxury retailers. The company’s strategy is deemed to result in accessible luxury offering that will be its guiding principle. The Star Inc. will adopt a multi-channel international distribution model to influence its marketing channels that will encompas s direct mail catalogues, e-commerce sites, retail, factory, department, and on-line stores in the target market regions. The management believes that through these different channels the company will effectively appeal to manifold segments that are often unnoticed by the competitors as they fear and avoid brand dilution. Competitor Analysis The luxury industry is characterised by intense competition. It has grown rigorously over the last decade with noted entry of new players and tough competition from established companies (Wang Shaver 2014).). The Star Inc. will primarily compete with the European luxury brands such as Louis Vuitton, Prada, and Chanel, which have been the leading deluxe companies for a couple of years. However, the Star Inc.’s unique business model of accessible luxury anticipates to reach a larger demographic as compared to the competitors’ higher priced products. According to the International Monetary Fund (IMF) report (2014), the total worldwid e luxury goods market is anticipated to compound 5% to 7% per annum reaching sales of $413 billion in 2016 (Bendle Vandenbosch 2014). Approximately, half of this expenditure is estimated to encompass travel necessities such as bags and accessories, smart watches, and modern telephone gadgets. Particularly, travel bags and accessories are estimated to be $64 billion sales. This figure represents 23.5% of sales of the luxury industry. The company will face stiff competitors from premium luxury makers such as Hermes, Gucci, Burberry, and Louis Vuitton and mid-sized enterprises namely Kate Spade and Tory Birch (Bendle Vandenbosch 2014). However, it aims at becoming the dominant player in the retail segment since it focuses on capturing the emerging markets in China and India. Looking at the Europe’s touristic potential as an international destination, especially in countries such as France and Italy that receive big spending visitors mainly from the Asian regions, the Star is h ighly optimistic to enter the luxury market without many obstacles. The company is also planning to explore the online market to provide timely and accessible services to its clientele. In the wake of globalisation, the Star Inc. acknowledges the importance of integrating business activities with internet services to ensure availability of product information to the consumers globally. As a result, the Star Inc. is set to launch an e-commerce site in the emerging markets. Marketing Goal and Objectives for the Star Inc. The Star Inc. has developed various guiding goals and stringent objectives. The primary goals of the company is to offer premium quality travel bags and accessories on a global scale and provide consumers with relevant and innovative products of excellent quality that are manufactured with specialty to build an inexplicable product-customer emotional attachment. Products will be sold at reasonable prices despite their luxurious nature with a view of reaching a wider m arket including the growing middle class youth, especially in emerging economies. Secondly, the company aims at driving the growth of the market share by scaling up the retail distribution channels to gain access to the local clientele. This strategy will leverage the tapping of global opportunities. In addition, the company will create an unshakable brand that will remain premier, distinctive, and easily recognisable. To achieve this objective, the Star Inc. seeks to deliver a consistent message to the consumer through diverse communication avenues including e-commerce websites, online, mainstream media advertisement, and active protection of the developed brand name from counterfeit products (Romaniuk 2012). The company also aims at understanding the changing needs of customers. Therefore, being consumer-centric right from product design, production, and distribution to after-sales services will create sustainable consumer loyalty. As a result, the company intends to conduct regul ar and extensive market surveys to guide innovation and obtain dependable consumer feedback. SWOT Analysis for the Star Inc. In economics, SWOT analysis is a basic strategic planning method that is used to assess the strengths, weaknesses, opportunities, and threats that influence businesses with a view of making feasible decisions (Ayub et al. 2013). It entails outlining the specific objectives of the business and identifying both internal and external factors that favour and/or hamper the achievement of those objectives. Strengths Weaknesses Opportunities Threats Strengths The company aims at utilising a multi-layered pricing strategy despite the fact that its products fall in the luxury class (McCann Vroom 2010). This strategy is contrary to the conventional pricing methods that are used for luxury products, as it will avail them to people of all financial capabilities. The Star Inc. will achieve this plan by pricing products depending on the financial ability of custome rs in different international markets (Ayub et al. 2013). The strategy will result in the seizure of a diversified market where aspiring customers from both the rich and middle classes will have gain access to premium products. Competitors have not used this pricing strategy; hence, it will enhance the company’s anticipated exceptional brand image and customer loyalty. Establishing dependable customer loyalty and a non-replicable brand image will enhance the company’s success even in harsh global economic crises (KrzyÃ… ¼anowska Tkaczyk 2013). The targeted middle and upper class consumers have a tendency to stick to their travel plans and vacations despite the global economic turmoil. Various studies indicated that the luxury industry continued to record substantial returns on investment in the 2009 financial crisis. Moreover, the company looks forward to providing strictly high premium products to create a reputable consumer impression. It will insist on quality and value with a view of winning many loyal customers. Besides, the star Inc. has accumulated enough liquid cash that it can use to finance its operations. As a result, the company has a significant advantage of its position in the luxury market that is characterised by rigorous social, technological, and economic changes (KrzyÃ… ¼anowska Tkaczyk 2013). The availability of adequate financial resources is paramount to the success of the firm since there will be no need to seek external funding for its operations. Furthermore, the company will have a distinctive and state-of-the-art product. Lastly, customer listening will be improved through market surveys and online customer support forums among others. This situation will immensely contribute to product development and distribution with respect to the customers’ dynamic needs. The product assortment will also be kept spanking new and appropriate. Weaknesses Weaknesses are perceived as areas within an organisation that call for improvement. They can include skills, marketing strategies, and product differentiation among others. There will also be a need to conduct a careful and in-depth research on the cost base and productivity levels of the organisation. Therefore, the management must be ready to face any unpleasant truths about the business amidst reality. The star Inc. concentrates on retail distribution. Retail business forms 99% of the Star business enterprise. It is an area of weakness since the company exclusively relies on end user consumers for its success. In case of a major production crisis, the overall business can collapse. Opportunities Economic analysts have provided crucial information on emerging markets that the organisation targets to enter. The company focuses on selling its products in the Chinese and Indian markets that are rapidly growing. The presence of a few players offering luxury travel bags and accessories is an excellent opportunity for the company to build its reputation an d create a sizeable competition gap. For instance, the company intends to seize numerous upcoming markets such as China and Brazil. In particular, the Chinese market has been deemed an ideal market for deluxe products due to the rising living standards and emergence of middle class members (Eggers 2012). Threats The contemporary business world faces high-level s of uncertainty that is characterised by erratic economic recessions and globalisation trends. Other factors that lead to volatility of the future include technological changes and consumer behaviours. This point is based on vulnerability of luxury products to recession as seen in the famous economic crisis of 2008. Many companies went through turmoil during the global economic downturn (Bekaert et al. 2014). During this period of economic hardships, consumers focus spending on necessities only because recession poses high degree of uncertainty. Even after the 2008 economic crisis, many firms in the luxury industry continued to struggle years on due to slow recovery. Given this scenario, it is undoubtedly that the success of the anticipated brand is attainable under healthy economies. This assumption is a high risk since the future of the global markets depends on a number of factors that are pioneered by dynamic technology. Notably, two types of substitute products that can pose threat to the Star Inc. include alternative brands and counterfeits (Miller Mills 2012). Brand image and product quality are they key driving forces for sales in the luxury and accessories industry. For this reason, investors in this industry spend a fortune on marketing campaign efforts such as advertising as well as sustaining premium quality products. Therefore, the Star Inc. will work in conjunction with competitors to combat counterfeit businesses through prosecution of culprit companies. The presence of counterfeit goods, especially from target markets such as China, poses a significant challenge to the company. Counterf eit products threaten the image of any company’s brand. Since some customers fail to differentiate between fake and original products, the company ends up losing its reputation of genuine products. Contingent Risk Factors International Market Penetration The long-term growth potential of the Star Inc. centres on successful entry into the international market and robust management strategies. The management requires significant resources and capital to venture into the European market among other emerging economies (Bekaert et al. 2014). Given that entrenched competitors presently dominate these regions, the enterprise must adopt strategic and high-end marketing approaches to surpass the prevailing competition. Although prospects seem strong today, if the international plans take long to materialise or the anticipated demand drops, the initial performance can fall excessively below the management’s expectations. The major concern for the Star Inc. is penetration and sus tainability of the Chinese market amidst the high rate of counterfeit practices in the country. In addition, the entry and stabilisation of short-term growth can be substantially slow than the company’s projections. As a result, the new-fangled products are likely to be disappointing in the short run. As a result, return on capital investment is conceivably going to be below the break-even point. However, the Star Inc. is exploring diverse economies around the world to cover stores that are likely to pick slower than projected. Along these lines, the company will sustain itself without having to pump in new capital to keep the stores operational. Lower Pricing Dissuasion The company will price its products lower as compared to those of the higher-end peers in line with the company’s accessible luxury motto. As a result, customers are likely to develop a tendency of being highly sensitive to the economy. Although the management views its pricing mechanism as a competiti ve advantage in uncertain macroeconomic climates, it may dissuade customers from buying the products (Tsai, Huang, Tsai 2013). For instance, given that the price elasticity of demand for Veblen goods is deemed high, consumers tend to perceive extravagant prices with exceptional value. Therefore, lower pricing can fail to attract customers, as they choose to associate the low price with low value. Stringent Competition The Star Inc. focuses to enter a highly competitive luxury industry. Although its aims to create an unparalleled brand loyalty, it winning consumer’s trust in the short term is nearly unmanageable. In addition, the market survey reveals that new entrants are attacking the incumbent niche day by day. Nonetheless, the management has done a tremendous job in reinventing itself over the decades. It will have to continue doing so to maintain standing leadership in the industry. We think the burden of proof lies with the bears. References Ayub, A, Razzaq, A, Aslam, M Iftekhar, H 2013, ‘A Conceptual Framework on Evaluating SWOT Analysis as the Mediator in Strategic Marketing Planning through Marketing Intelligence’, European Journal of Business and Social Sciences, vol. 2 no. 1, pp. 91-98. Bekaert, G, Ehrmann, M, Fratzscher, M Mehl, A 2014, ‘The global crisis and equity market contagion’, The Journal of Finance, vol. 69 no. 6, pp. 2597-2649. 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