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Marketing Management Of Strategic

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Question:

What is the Marketing management of Strategic ?
 
 

Answer :

Introduction:

Marketing strategy is one of the most effective parts of business plans and policies. In order to achieve organizational success the business experts have to keep a continuous update about the needs and demands of the customers. This particular study has provided an in-depth understanding, on how a particular business organization should focus on managing marketing strategy for drawing the attention of the customers. As per the business plans and policies, maintaining product and service quality is not the only vision of an organization. In order to draw the attention of customers from different geographical market, the marketing managers have to implement numerous strategies and policies to survive with current market demand. This particular study has focused to highlight the current market strategy and policy of PT. Feradime Group for expanding their entire business process beyond going the regional boundary of Indonesia.

Back ground of Company:

  1. Feradime Group is a flourishing engineering consultant company established their business process in Indonesia. Initially, the primary aim of PT. Feradime Group was to provide effective consulting service process to oil and gas sector. It has been observed that in last few years’ oil and gas sectors has been facing a disastrous consequence due to the rapid declination of oil prices (Azma and Mostafapour 2012). As a result, the company like PT. Feradime Group has faced major difficulties to maintain market demand. In order to overcome this kind of situation, the organization has decided to change their business genre to Smartphone application development. In the year 2015, the business experts have launched a new product by developing the software for mobile application. With the help of innovative service process, this particular organization has already created a demand in the current market of Indonesia. In May 2016, PT. Feradime Group has received an award for a project. This particular company being a start-up business is possessed with 11 staff members overall. Development of software for mobile application such as Apply Pie, Mobile Roadie, Bizness App, Shoutem, Como, OutSstem, MagPlus Design are the core product of PT. Feradime Group. The service providers of this organization are flexible enough to deal with any kind of customers belonging to different cultural and religious background (Baldwin, Cave and Lodge 2012). Due to the limited employees at the workplace, the business experts have to face difficulties for maintaining balance between supply and demand. Being the new business process PT. Feradime Group needs to focus on effective promotional activities based on which the products and services can be reached to the door of customers.  

Objective:

The primary aim of this particular study is to evaluate the importance of strategic marketing management for business expansion. The objectives of this study are as follows:

  • To critically understand the impact of implementing new marketing strategy for business progress
  • To highlight the benefit of conducting market analysis before forming the business strategy and policy
  • To provide some major recommendations on how the marketing strategies can be developed for enhancing the revenue growth of the company
 

Conduct Analysis:

Indonesia as per the current situation is out an out under-developed country in comparison to its population (Benitez-Amado and Walczuch 2012). Therefore, before making market strategy and policy every business organization has to conduct an effective market analysis. PT. Feradime Group after changing their business sector has decided to conduct an effective market analysis to evaluate the current trend of Indonesia market.   

PESTEL

Before forming the market strategy and policy, the organization such as PT. Feradime Group likes to make an effective external or macro analysis in order to know the political, economic, social, technical, environmental and legal factors.

PESTEL ANALYSIS

Political

Ø  The political environment of Indonesia is suitable to maintain the business process of an organization.

Ø  PT. Feradime Group after launching new products in the market is not affected by the political movements and tax policies of the organization

Economic

Ø  The current economic status of Indonesia is low

Ø  As a result, PT. Feradime Group while drawing customers attention would have to focus on implementing low cost strategies to survive in the market  (Bertay, Demirgüç-Kunt and Huizinga 2013)

Social

Ø  Indonesia is possessed with the people of various cultures and backgrounds

Ø  Therefore, before designing a product the business experts may focus on dealing with the diversified products and services  for being unbiased towards any particular cultures and religions  

Technical

Ø  Indonesia being an under-developed country is not very advanced in technological progress

Ø  Therefore, before developing new software for mobile applications the organization should make systematic promotional activities to create awareness on the products and services of PT. Feradime Group (Cadez and Guilding 2012).

 

Environmental

Ø  Indonesia is constituted with 17508 islands having tropical climate. this particular climate is not very much suitable for launching numerous mobile applications

Ø  As a result, before launching this kind of products in the market of Indonesia, this particular organization like PT. Feradime Group should focus on market promotions and services.

Legal

Ø  Before running a business process properly, the organization has to maintain some major acts and regulations properly.

Ø  The regulations include the implementation of national employment law, international trade regulations and restrictions, monopolies and mergers’ rule and so on (Dixit and Skeath 2015).   

Table 1: PESTEL Analysis of PT. Feradime Group

(Source:  Economides and Tåg 2012)

Competitor’s advantage:

While running business organization, the company like PT. Feradime Group should always focus on rendering profit more than of its current competitors. PT. Feradime Group before making effective strategies and policies for becoming a threat for the competitors, tend to focus on conducting market survey (Gast and Zanini 2012). This market survey helps the business experts to gain an in-depth knowledge and experience regarding the strategies and policies of other competitors of PT. Feradime Group. After conducting market survey, the business experts have analyzed some major drawbacks within their business process that has become a big advantage for the competitors (Ghemawat 2013).

  • Feradime Group is primarily known as one of the most recognizable engineering consultant. After the declination of oil price, the business experts have decided to switch over the industry to IT. Therefore, the company has faced innumerable challenges to establish their business among several IT companies in Indonesia. At the same time, it is undeniable that the employees of PT. Feradime Group are not efficient enough to act as an eminent software developer (Grant 2016). Therefore, the employees are unable to provide effective service process to fulfill customers’ needs and demands sometimes.
  • Feradime Group established their wings in the IT industry currently. Therefore, the marketing managers had to face innumerable difficulties to gain customers’ trust and expectation (Henisz and Zelner 2012). Due to the limited budget in promotional activities the marketing executives failed to maintain proper promotional activities in various geographical markets. As a result, the customers are deprived to get detailed overview about the products and service procedure of PT. Feradime Group. Therefore, financial strength is one of the most significant factors to flourish entire business process in the market of Indonesia.
  • Product diversity is another aspect that enables the customers to be attracted towards business organization. Feradime Group was primarily familiar for engineering consultant (Hilmersson 2014). Therefore, in this specific sector this particular organization can be considered as start-up. Therefore, PT. Feradime Group failed to maintain product diversity within their organization. This particular factor has become an advantage for the competitors.

SWOT

Before forming strategic plans and policies for the organization like PT. Feradime Group, the business experts have to conduct an effective internal analysis for evaluating the strength, weakness, opportunities and threats of the company.

SWOT ANALYSIS

Strengths

Ø  Sufficient number of workforce is one of the major strengths for the organization like PT. Feradime Group

Ø  Indonesia is possessed with limited number of IT companies. As a result, the organization does not have to face huge market threat from competitors.

Weaknesses

Ø  PT. Feradime Group was popularly famous as engineering consult company. Therefore, the business experts failed to gain trust of customers by providing products and services (Hollensen 2015).

Ø  After the declination of oil price, the economic strength of PT. Feradime Group has been reduced widely. As a result, the organization failed to make a better plan for providing quality services as well as maintaining product diversity.

 

Opportunities

Ø  PT. Feradime Group is endowed with the scope to enhance the rate of sales growth in the market of Indonesia

Ø  The marketing managers can provide sufficient money for maintaining effective promotional activities

Threats

Ø  Competitor’s market strategy has become significant threat for the organization like PT. Feradime Group

Ø  The other contemporary organizations prevailing in the IT tend to afford sufficient budget for business promotion (Hyde 2015). Therefore, customers tend to show their indifferent attitude in purchasing the products as well as service process of PT. Feradime Group.   

Table 2: SWOT Analysis of PT. Feradime Group

(Source: Kim et al. 2012)

Market analysis:

Kim and Mauborgne (2014) opined that maintaining superior quality of products and service process should not be the sole purpose of a particular organization. The business experts for achieving business success have to focus on major significant aspects of market. Target market, market segmentation, brand positioning are the primary steps with the help of which customers can be segregated as per market. This particular part has provided an in-depth analysis on the overall impact of target market in business success. PT. Feradime Group market analysis helps the customers to get detailed overview about the reliability of products and services of this organization.

Segmentation:

  1. Feradime Group has decided to conduct the market survey as per STP analysis. STP can be considered as one of the most fruitful market strategies with the help of which the organization can segregate the entire target group of people. The product designs and the diversification of services are highly dependent on target market (McCain 2014). Therefore, STP analysis is the major tools that enable the business experts for getting an in-depth overview regarding customers’ expectations and their demands towards products as well as services. In this specific part, detailed overview of STP analysis has been presented. PT. Feradime Group has decided to segregate the entire target market as per geographic, demographic and psychographic segmentation.

Demographic

At the same time, people from other locations of Indonesia are targeted for purchasing the products and services of PT. Feradime Group. This particular organization being software-developing company for mobile application has focused to target the young age group of people especially having average level of income (Morgan, Katsikeas and Vorhies 2012). People from the age group of 20 to 40 can afford the products and services of PT. Feradime Group. On the other hand, the production managers have decided to design the products in such a way that people from different cultural and religious backgrounds can show their interest for purchasing the products and services of this organization. Indonesia being an under developed country is possessed with the inhabitants who are having average level of income status (Piercy 2014). Young generation in average income status is the core target group for PT. Feradime Group.

 

Geographic

Geographic market segmentation enables the market executives to select the customers from the location of Batam in Indonesia. The marketing managers while setting the niche strategy and policy has focused on implementing low cost strategy regarding products and services. Therefore, in order to draw the attention of those particular customers, the marketing executives had to focus on implementing low cost strategy for targeting the people of Batam. On the other hand, the marketing executives have currently concentrated to expand their business different localities of Indonesia apart from Batam.

Behavioral

  1. Feradime Group has transformed their industry from an engineering consultancy to Smartphone software developing company. PT. Feradime Group being a start-up business process likes to design those kinds of products that enable the customers from all behavioral backgrounds and attitudes to purchase the products and services of this organization. As a result the marketing managers are successful to enhance the number of target customers.

Psychographic

As per the psychographic market segmentation organizations have to maintain a business ethics, values, cultures and beliefs while dealing with the people from different cultural attitudes. PT. Feradime Group is the software developing company that builds applications for Smartphone users. Therefore, while developing the products the production managers have focused to draw the attention of customers belonging to different level of cultural attitudes and religious backgrounds. As a result, the marketing managers have enhanced the number of target customers.

Target market

Target market is one of the most effective business strategies and policies with the help of which business organization like PT. Feradime Group tends to sell their products and services by focusing on that particular group of people. In this specific study, the business organization has decided to focus on Batam as the target area (Ledenyov and Ledenyov 2012). After having switched over the industry from engineering consultancy to Smartphone software developing the marketing managers has changed their target group as well. Young group of people who like to use Smartphone are the primary target group of PT. Feradime Group. People from different age group who are accustomed with using Smartphone will be targeted. Along with Batam, the business experts have decided to expand their entire wings in various geographical corners beyond going the regional market of Batam.

Effectiveness of target market

The effectiveness of target market is endowed with a major significance. Target market evaluation is highly important before making business strategy and policy for a business organization like PT. Feradime Group. Based on the particular target group of people, the marketing managers tend to focus on promotion. The business scripts are prepared as per the target group (Malhotra Birks and Wills 2013). The marketing managers tend to focus on using media vehicles and other promotional tools as per the psychological and cultural background of target market. The software that PT. Feradime Group has developed for their target group has been designed in such a way that those customers cannot show their reluctance for using products and services of this specific organization. At the same time, the service procedure is also decided based on the expectation of target customers.                

Positioning:

Ritala (2012) stated that brand position is one of the most remarkable factors, based on which the reliability of products and services can be reached to the customers.  Along with providing good services, the business experts have to think on how the brand should be positioned to drag the customers’ attention. However, PT. Feradime Group while positioning their new products in the market has decided to use some of the popular tools of media (Ronda?Pupo and Guerras?Martin 2012). As a result, people from numerous locations get to know about the new initiatives of PT. Feradime Group.

The marketing managers of PT. Feradime Group have decided to use both offline and online media for positioning their brand in market. Indonesia being a developing country is not advanced in technology. Therefore, the business managers have avoided using the tools of digital marketing for positioning the brand of PT. Feradime Group. The use of print media, banners, hoardings, signboards is used as an effective offline media vehicle. These specific tools are very much successful for drawing the attention of regional customers. On the other hand, electronic media such as radio and television has been chosen as one of the most effective mediums of brand position (Rothaermel 2015). Electronic media is successful enough to multiply the messages. As a result, people from different corners can receive the messages. Therefore, the brand position strategy of PT. Feradime Group would be primarily effective for target customers only when they would be able to receive a clear message and overview regarding the reliability and ingredients of products and services.

Market mix strategy

Market mix strategy is primarily applied for maintaining a systematic promotional activity. Market promotion is desperately needed to render proper reorganization of a particular brand (Scholes,et al. 2014). PT. Feradime Group was primarily famous in the industry of engineering consultant. After changing the business sector, the business experts had to face immense challenges in regaining the trust of people. However, in order to promote the new brand of PT. Feradime Group, the marketing managers have decided to implement four Ps of marketing mix strategy primarily.

Product:

Software for mobile application is the core product that PT. Feradime Group has launched after switching over their business sectors. After the emergence of Smartphone, the service users have become very much dependent on mobile applications. By using numerous mobile applications, the service users tend to communicate with the people of different multinational countries (Shih, Chen and Chen 2013). At the same time, the use of mobile application has reduced the burden of carrying laptops and personal computer. However, with the current scenario, the emergence of Smartphone users has become large in number. Therefore, after facing a disastrous consequence in the market of oil and gas sector, this particular product may render an innovation within the entire business process (Sui and Baum 2014). Therefore, the business experts have selected developing software for mobile application as the primary product based on which the Smartphone users would get necessary benefits and facilities. At the same time, the service providers of PT. Feradime Group are flexible enough to give equal priority to the customers of different attitudes.  

 

Pricing:

As already mention, Indonesia is out an out under developed country.  People having average level of income status are the primary inhabitants of Indonesia. Selected number of multinational corporations is situated in the heart of Indonesia. Therefore, people over here get least opportunity to enhance their income level (Thompson et al. 2013). On the other hand, PT. Feradime Group has started their business IT sector. Therefore, any kind of brand value strategy may have a negative impact on the customers’ impression. However, the business experts have decided to implement low cost strategy in order to enhance the range of target customers.

Wei, Samiee and Lee (2014) opined that the implementation of low cost strategy sometimes fail to draw the attention of premium customers. Premium customers tend to pay the attention for purchasing a particular product based on brand value. Therefore, low pricing cost has a negative impact on the mind of premium customers. However, in case of PT. Feradime Group, most of the target customers belong to average income status. In this kind of situation, brand value strategy would not be suitable for this particular organization. The marketing managers by maintaining a collective decision making process have decided to focus on following low pricing cost strategy for drawing customers’ attention.

Place:

Business organization should be established in such places where the customers can easily avail for purchasing products. Batam is one of the most recognizable places situated in Indonesia. Therefore, customers from different regional market would be able to avail the service facilities of PT. Feradime Group. At the same time, it is undeniable that this particular organization is possessed with one specific destination. The branches of PT. Feradime Group are not available at any place of Indonesia. Therefore, the products are only achievable for regional customers. People who belong to different geographical market fail to use the products and services of PT. Feradime Group.

As per the opinion of Wilson and Post (2013), place is having a major significance for creating a brand identity and image. While promoting the concept of products and services in the mind of customers, the business organizations have to provide an in-depth overview about their destinations and establishment of business process. If the customers are impressed at the product concept, they intend to use products as well as services. Therefore, the company such as PT. Feradime Group should be situated in such areas where people do not have to struggle to find out the location.

Promotion

Promotion is one of the most important tools of marketing mix without which the products cannot be reached to customers’ doorstep. In order to promote the products in different boundaries of market, the business managers have to use some most effective promotional tools. Direct marketing, sales promotion, personal selling are the primary tools with the help of which the service providers can communicate with customers (Wu et al. 2013). The business managers of PT. Feradime Group have decided to use direct marketing tools as the best way of promoting business. This particular organization after introducing a new product in the current market needs to make a face-to-face communication with the customers for collecting a direct feedback.

Direct marketing process is one of the most effective promotional tools with the help of which the service providers and the service users get the scope to communicate directly. As a result, the service providers can directly convince the customers on how their products are different from other contemporary brands. On the other hand, customers get the scope to provide their immediate feedback regarding business strategy and policy to the service providers. As a result, the entire communication between the sales executives and customers becomes clear and immediate.  

The impact of media vehicle in communicating with the customers is highly important. Media vehicle helps the business communicators to interact with the target customers by multiplying their business concept in various geographical areas. However, communication leaves a major impact in brand promotion. The impacts of communication and media vehicles are as follows:

Acts as a bridge:

Media vehicle acts as a bridge between the customer and the organization. Media is the promotional tool with the help of which customers can gain an in-depth overview regarding the products and service process of organization like PT. Feradime Group. Therefore, the business representatives in order to communicate with the target group uses media as the most effective vehicles.

Conveys the message more quickly to the doorstep of customers:

In order to convey the message of launching new products media acts as a major tools that makes the way of communication easier. Customers do not have to struggle for gaining knowledge regarding product and services. In addition, media communication renders the business representatives closer to the customers (Wu et al. 2013). PT. Feradime Group therefore decides to use both print and electronic media to reach both regional as well as outside market. At the same time, it is undeniable that the range of electronic media is higher than print media. Electronic media communication can easily convey the product messages to the customers’ minds and doors.

Launch the product in global market:

In order to place the product in global market media communication is the only way, based on which customers from various geographical boundaries can be aware of product as well as service facilities. In order to achieve the recognition of global market PT. Feradime Group should use the popularity of television for multiplying messages in various geographical markets. At the same time, after receiving appreciation from the customers of multinational countries, the brand gets the new stature of international product (Wei, Samiee and Lee 2014). PT. Feradime Group business experts are trying to reach their new brand in the international market.

Recommendation:

After evaluating the entire market strategy and policy of PT. Feradime Group, some of the major recommendations can be provided:

  • While making the promotional strategy the marketing managers should fix a proper promotional budget. The business experts of Feradime Group have not concentrated in making a systematic promotional budget. Based on that budget the business managers could use the media vehicles
  • The marketing managers of PT. Feradime Group have focused on four Ps of marketing mix strategy while preparing the project. In order to make the promotional plans and policies business organizations would focus on 7Ps of marketing mix strategies primarily. As a result, the business managers would be able to concentrate on people, process and physical evidence as well for evaluating the promotional strategy
  • Feradime Group has primarily focused to make the market strategy based on Batam. The business organization does not concentrate to expand their business process in various geographical areas. As a result, the overall business process is very much restricted within particular geographic area.
 

Conclusion:

The entire study provides in-depth analysis regarding the market evaluation strategy of PT. Feradime Group. This particular organization was initially famous for engineering consultant. After changing the business sector due to sudden declination of oil price, PT. Feradime Group has decided to use some of the major policies of promotional activities for drawing the attention of customers. The implementation of STP analysis and marketing mix strategy is highly effective for drawing the attention of customers. Based on the marketing strategies and policies some of the relevant recommendations have also been provided.

 

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