Marketing Opportunities For BBQfun In A Competitive Retail Industry Essay.

Describe innovative or creative options (one for each opportunity) to apply the marketing opportunities in the context of the organisation. Refer to aspects of the marketing mix, i.e. product, price, promotion, place (distribution). Refer to, and explain, principles of marketing that apply to your approaches to realising the proposed opportunities.

1. Use appropriate language and level of formality to satisfy needs of your audience. For example:

a. professional but semi-formal language

b. technical vocabulary; potential need to define more obscure marketing terms or statistical methodologies

c. assume no knowledge of specific organisational policies or marketing strategies

d. elicit views and opinions of others by listening and questioning

e. provide for response and feedback.

2. Prepare and keep presentation notes and other materials used in the presentation such as PowerPoint slides and handouts.

3. Deliver your presentation as per specifications (below).

4. Submit presentation notes, PowerPoint slides, etc. to your assessor. Keep a copy of all documentation for your records.

Marketing Opportunities and Considerations

Marketing is paramount to any organisation, and this is because it helps the specific organisation to reach a wide range of customers thus making profits by boosting its sales. However, it is essential to note that there are different methods of marketing the products and services of an organisation. An organisation should, therefore, be keen to look into its marketing strategies with the aim of making sure that it utilises the most attractive marketing methods. Marketing opportunities are the chances that an organisation can explore to reach a significant number of customers. When the market is competitive, an organisation ought to be strategic on the best marketing methods to use. BBQfun is an organisation that is in the retail industry, and it is aimed at delivering quality goods products and services. The company is in a competitive industry that has seen many changes as well as the entry for new organisations which come with new ways of doing business. The company will be used as a reference organisation in determining the marketing opportunities that best suits it and some of the effects and considerations of the marketing opportunities.

The organisation that will be focused on in this case is BBQfun. The company deals with the sales of products in a wide range. The marketing opportunities that are there for the company are digital and influencers marketing.

BBQfun should concentrate on the local markets. It is evident that the company has not been doing well and that is associated with the stiff competition that is present in the industry. In this respect, there is no need for the company to start exploring the global markets. Different factors must be considered when an organisation is planning to expand to other markets. The first consideration is the performance of the company. Currently, BBQfun has demonstrated that it is struggling with the current markets. Therefore, the company is in no position to start expanding to international markets. There is a need to note that the same organisation that is responsible for its management affairs will be the same organisation that will be expected to manage the affairs of the international markets. Therefore, if the company is not doing well in the local markets, reaching the international markets can be a challenge.

The second factor to consider while investing in a different market is the business atmosphere. An organisation might be struggling with its management but operating in a business environment that is encouraging. In this case, an organisation can take risks because it knows that the risks can pay off. The case of BBQfun is different because the organisation is in a competitive and challenging environment. Therefore, the solution is not to explore the international markets but to know the best way to survive in the current markets.

Increasing Market Share as a Primary Approach

The first and essential marketing approach for the company is to increase the market share. The organisation has demonstrated that it is not in a good position in terms of sales. Therefore, it means that there is a gap in the market that needs to be closed. Increasing market share will be the best approach before the company can think of a new market.

1. Digital Marketing

In digital marketing, technology is utilised in every stage with the aim of meeting the needs of the customers. It is imperative to note that the world of business has advanced and that has been influenced by consumer behaviors as well as the advancements in technology. The customers have started to trust the internet more during their decision-making process. Customers are looking at organisations and products on the internet before purchasing them. This presents an opportunity for the organisation to use the platform that is mostly used by the modern day customers.   

1. Influencer Marketing

Influencer marketing is a marketing opportunity that has not been explored by many despite the fact that it has proven to be effective. The stakeholders, in this case, are used as the ambassadors of the company. The employees are encouraged to make sure that the products are marketed to the customers. Considering that the employee is the person who spends more time with the customer, he or she is in the best place to pass a message about a specific product to the customer. BBQfun needs to continue establishing a strong relationship with the customers, and that means that the company needs to utilise the presence of the employees as brand promoters and marketers.   

The two marketing opportunities will have effects on market share, sales, profits, and growth. The opportunities come in place to increase the presence of the company in its areas of operations, and that means that growth will be inevitable. The concentration on one area will increase market share, and the sales will automatically affect the profits of the company.  

The demand for products can be seen in the trend of the sales and the profits. In 2017, the sales that were recorded were 12,000,000 and 15,000,000 in 2018. The difference between 2017 and 2018 was 3,000,000. The figure was higher than the difference between 2016 and 2017 which was only 1,000,000. The increased figure shows a potential increase in demand by at least 300%. Considering that the opportunities were not exploited by then, it is apparent that the demand for the products is likely to increase by a significant percentage. If the opportunities increase the demand by 100%, it is likely that the sales of the company will be affected as well as the profits.  

1. Digital marketing

Utilizing Digital Marketing

The use of the internet, social media, organisational websites, and online marketing organisations will come in handy to make sure that the organisation is in the best position to market its products to the potential customers.

1. Influencer marketing

The best way to promote the influencer marketing is by making sure that the employees are trained on the best ways to market the company and its products. Therefore, apart from the employees working for the company, they will also be marketing the products of the company.

Fill in the blank spaces in the BBQfun sales data worksheet in the following order;

Financial year (FY)	BBQs	Outdoor Furniture	BBQ Accessories	Total
FY 2012–13	25,000	13,000	42,000	80,000
FY 2013–14	35,000	15,000	58,000	108,000
FY 2014–15	40,000	17,000	68,000	125,000
FY 2015–16	45,000	19,000	75,000	139,000
FY 2016–17	50,000	21,000	70,000	141,000

	BBQs	Outdoor Furniture	BBQ Accessories
Number of buyers	29,000	13,400	61,600
Quantity	1	1	3
Average price	$620	$880	$55

	Own brand	E-commerce	Bargain market
Sales volume (units)	BBQ: 7,200	BBQ: 6,960	BBQ: 10,000
	Furniture: 3,120	Furniture: 3,216	Furniture: 5,000
	Accessories: 40,320	Accessories: 44,352	Accessories: 52,500
Price	BBQ: $600	BBQ: $620	BBQ: $500
	Furniture:$850	Furniture: $880	Furniture: $650
	Accessories:$50	Furniture: $55	Accessories:$40
Unit contribution margin	BBQ: $500	BBQ: $300	BBQ: $200
	Furniture: $600	Furniture: $420	Furniture: $220
	Accessories: $40	Accessories: $20	Accessories: $10
Total revenue	BBQ: $4,320,000 Furniture $2,652,000 Accessories: 2,016,000	BBQ: $4,315,200 Furniture: $2,830,080 Accessories: $2,439,360	BBQ: $5,000,000 Furniture: $3,250,000 Accessories: $1,020,000
Total Gross Profits	total revenue 8,988,000 cost of goods sold 7,084,800=1,903,200	9,584,640-4,325,760=5,258,880	9,270,000-3,625,000=5,645,000
Additional fixed costs	Add lease: $1,000,000 Add labour: $500,000 Add plant (depreciation): $500,000	Add training: $50,000 Add online store development: $100,000 Add a new plant and equipment (depreciation): $150,000 Add labour: $250,000 Add reconfiguring of warehouse/ office: $50,000	See approved budget (no change in fixed costs)
Total net profit FY 2016–17	7,084,000-2,000,000=5,084,800	4,658,550	5,645,000

 

	Own brand	E-commerce	Bargain market
Cash flow 2016–17	1,900,3200	5,258,880	5,645,000
Opportunity cost	8%	8%	8%
The present value of initial investment	3,600,000+1,872,000+1,612,800=7,084,800	2,088,000+1,350,720+887,040=4,325,760	2,000,000+1,100,000+525,000=3,625,000
Profitability Index	7,084,800/1,903,200=3.722	4,325,760/5,258,880=0.82	3,625,000/5,645,000=0.64

Resources	Costs
Additional staff	$25,000 year average	Additional staff costs: (25,000x6) $150,000
Plant and equipment depreciation	· Delivery trucks ($20,000 each) · Forklifts ($10,000 each)	Plant and equipment costs: (20,000x6)+(10,000x3)= $150,000
Promotional costs	$500,000
Website developers	Contractors ($2,000/day)	Website development cost: (2000x50) $100,000
Staff training	Online customer service training ($3,000 per staff member)	Staff training cost: (3000x8) $24,000
Management change leadership training for store managers and team leaders	$3,000 each	Management and leadership training cost: (2x3000) $6,000
Warehouse and office reconfiguration	Reconfiguration cost: 200,000
Total	$1,130,000

Analyse the three opportunities outlined in the scenario in terms of likely fit with organisational goals and capabilities

1. Organisational marketing plan, structure, products, and services

The three opportunities are aimed at making sure that the company increases the number of customers by a significant percentage. The marketing plan of the company has focused on increasing sales by at least 1,000,000 in one year. The opportunities also look into how the company can manufacture its goods, and that is in line with the marketing plan where the company wants to deliver nothing less than good quality. Considering that the company will be manufacturing its products, it will be able to manage the quality, and this means that in this aspect, the properties perfectly fits in the goals of the company.

1. Principles of marketing and the marketing mix

The three opportunities will give the company control over its products. Therefore, the company will dictate the price, place, product, and promotions of its products thus meeting the requirements of the marketing mix. Therefore, the three marketing opportunities come in handy to meet the needs of the company.

1. Additional marketing information such as survey results in the BBQfun sales data worksheet

Additional marketing information will be essential for the three marketing opportunities. The opportunities have also ventured in different markets, and that means that the opportunities will promote change in the company. Therefore, it would be essential to make sure that the changes are evaluated by looking into additional information about marketing.

Using the information in the BBQfun sales data worksheet, evaluate each opportunity in terms of impact on current business and customer base.

Kindly refer to “Opportunities and profit figures for calculation” table.

1. Impact on growth plans

Selling the products of the company online will have two impacts on the plan of growth. The opportunity will limit the growth of physical stores, but it will come in to promote the growth of the sales that will be made online. The manufacturing of goods will affect the growth plans positively. The opportunity affects the operations and sales of the company, and that means that it adds to the growth of the company. Selling products on bargains will promote the growth of the company because it will increase the customers. Therefore, it is evident that this will have a positive impact on the growth plans of the company.

1. Market share

Exploring Influencer Marketing

Production of goods will help in serving more customers because the company will have more to offer than before. Using the online platform to sell products will reach a lot of online consumers. When it comes to bargain market, it is apparent that customers love discounts and they will flock to the company to get the products at a discount. In this respect, it is evident that the three opportunities will have a positive impact on market share.

1. Knockout factors to rule out opportunities

The presence of knockout factors to rule out the opportunities cannot be ignored. However, the opportunities can only be internally affected and this is because they are internally driven. Therefore, it means that the chances of success are high and the chances of being frustrated are low.

Assess external factors that may be relevant to each opportunity. Identify all of:

1. Codes of practice and model

Using online platforms does not eliminate the code of practice in marketing. Therefore, the company will still be submissive to the codes of ethics in marketing. This will mean that the information provided must be factual. The manufacturing industry is guided by different codes of ethics which range to how employees are treated and how the working environment should be. In this case, the company has no other choice but to be submissive. The company must make sure that the safety of the employees in the manufacturing plant is well taken care of. When it comes to discounts, the organisation must be honest in the percentages of discounts.

1. Regulations

The online platforms have different regulations that organisations must follow. For example, an organisation can choose to use one platform under a specific package or choose another organisation with a different package as well. In this respect, the organisation is supposed to adhere to all regulations, and they include the charges that might be payable. Regulations on manufacturing help an organisation to know what it is required to have for it to manufacture goods. The organisation must meet all the regulations or meet the consequences. In discounting, different organisations have prices set for the retail products. A company is not supposed to sell products lesser than the set prices of discount. Therefore, when the company is offering discounts, it must look into these requirements.

1. Relevant legislation

The law prohibits the display of products that might endanger the lives of people or might be offensive to some people. In this respect, the company must observe this law when marketing and selling its products online. The consumer protection law looks into the ways an organisation treats its customers. When it comes to discounting, this law applies because it makes sure that the discount that the company states to give is the same discount that the customers receive. When it comes to the matter of manufacturing, the law places requirements that a company must meet. In this respect, the company must meet all the legal requirements for it to be operational.

Effects of Marketing Opportunities on Market Share, Sales, Profits, and Growth

Referring to BBQfun simulated business documentation, summarise significant costs, benefits and risks associated with each opportunity, including risks associated with potential competitors. Identify at least two strategies or approaches to mitigate risk.

1. Manufacture and sell own brand

The significant costs, in this case, are the costs of leasing, costs of machinery, costs of logistics, and costs of operations. The benefits are that the company plans its delivery of products and it manages the quality of the products. The major risk is that this is a new field and the company might not have all the knowledge to manage the operations. The risks of the competitors are increased competition and loss of market share to BBQfun. The two strategies of mitigating the risks are employing the best professionals to run the manufacturing plant and purchasing the most advanced equipment.

1. Sell products through e-commerce

The cost of this opportunity is setting up the online platforms. The benefits are that this opportunity is cheap and it is likely to reach a wide variety of customers. The major risk is that there is that the competition in online platforms is high and the plan of the company might fail if not well strategised. The competitors will have a risk of losing some of the customers to the company. The best way to deal with these risks is to research the platforms that are most effective and to employ IT strategists who will be spending their entire time making the platforms effective.

1. Sell products at bargain prices

There is no cost that is associated with selling products at bargain prices. The benefits are that customers will be given the power to negotiate and at the same time, more customers will be attracted. The major risk is that the opportunity might be short term due to the unpredictability of products. The risk for the competitors is that they might lose customers to the company. The best ways to deal with the risks are by sourcing products from the cheapest suppliers and putting a minimal margin for bargaining.

Using the information in the BBQfun sales data worksheet, assess the return on investment for each opportunity. Calculate the profitability index for each opportunity.

E-Commerce

(5,645,000/9,270,000)x100=60%

Bargain Market

(4,658,550/9,584,640)x100=47.5%

Own Brand

(5,084,800/8,988,000)x100=56.5%

Based on your analysis so far, rank the three marketing opportunities.

1. E-Commerce

E-Commerce has the best returns, and the costs are low.  

1. Bargain Market

Bargain market might not be a long-term solution.

1. Own Brand

Own brand is expensive, and the assurance levels of success are low.

Sales Data Worksheet for BBQfun

Identify changes to current operations in order to take advantage of the opportunity.

The increased number of employees to attend to online customers will be essential. The advancements in the aspect of technology will also come in handy. The organization will also need to bring in specialists in IT so that they can facilitate the essential changes.

Resource requirements and costs for changed operations. Consider:

1. Additional staff

The additional organisational activities come with the need for additional staff. In this respect, the company is justified to budget for additional staff.  

1. Distribution costs

The company will now be taking care of its supply chain. Therefore, there is a dire need to increase the tools and equipment that are used in logistics.

1. Equipment

The opportunities have increased the operations of the company. Therefore, it is evident that the company will need additional equipment.

1. Promotional costs

The promotion of the employees to leaders will come with the cost of promotion. This is because these are employees who have been in one rank and they need to perform in a higher rank.

1. Staff training

The current staff members need to be equipped with the required skills to handle the changes that will be ushered in the company.

Executive Summary

Marketing is beneficial to organisations that want to reach potential customers. The three opportunities that have been presented; own brand, bargain market, and e-commerce are essential for the company. they, however, come with risks and costs. The benefits of the opportunities cannot be compared with the risks and the costs because they will provide the organisation with an opportunity to grow and advance. The investigation of the three opportunities shows that it is essential for the opportunities to be implemented by the company. The data of the three opportunities have been presented in this paper, and therefore they will not be repeated. However, analysis and explanations will be provided.

Sales volumes

The three opportunities have proven to have effects on the sales volumes. Some of the benefits that come with the opportunities are the attraction of customers and promotion of organisational operations. In this respect, it is no doubt that the company is likely to experience increased sales volumes.

The findings show that the opportunities have effects on the market share, the profits, sales, and growth of the company. The main reason is that the opportunities add more customers to the company. When the number of customers is increased, it is more likely that the organisation will grow and increase its profits. At the same time, it is evident that the attraction of more customers increases the sales of the company significantly.

Costs of the opportunities

Each of the opportunities comes with its costs. The reason behind it is because most of these opportunities will be implemented by the company for the first time. This means that the company will have to make adjustments. However, the costs of improvements and adjustments are minimal when compared with the benefits that will come with the implementation of the opportunities.

Ranking

The most suitable opportunity is e-commerce followed by bargain market and then own brand. The suitability test has been based on the fitness of the opportunities in the organisational operations. At the same time, the time that would be taken during the implementation process has been considered.

Different changes will be needed to change to e-commerce. The need of IT professionals who will help in developing website and software will come in handy. The employees will be trained on how to handle online customers. The company will also need to advance its equipment so it can meet the needs of dealing with the e-commerce business. The reason why all these changes will be essential is to make sure that there is a smooth transition to e-commerce operations.

References

Bolotaeva, Victoria, and Teuta Cata. "Marketing opportunities with social networks." Journal of Internet Social Networking and Virtual Communities 2010 (2010): 1-8.

Douglas, Susan P., and C. Samuel Craig. "The role of context in assessing international marketing opportunities." International Marketing Review 28, no. 2 (2011): 150-162.