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Marketing Plan (A Case Of Primark) Add in library

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Question:

Describe about the marketing plan for the Primark and challenges faced during time of developing the marketing plan?
 
 

Answer:

Introduction

Marketing plan in the current business scenario holds the company to gain the competitive edge.   Marketing plan helps the organization to make various tactics to stay in the hunt among the fierce competition in the market. Fashion industry is one of the most frequent changing industries as because the style and clothing line changes every month (Aaker, 2010). Primark is Irish company based in Ireland but it has its branches all over the UK. The company holds more than 38 stores across the nation that includes Austria, Belgium, Spain, Netherlands and United Kingdom. Based in Dublin, the company tries to operate on the plan of market expansion (Primark.com, 2015). The company tries to target consumers with the help of quality that can focus on the quality as well as customer retention. The study will focus on the marketing plan for the Primark and challenges faced during time of developing the marketing plan.

1. Determine marketing strategies

1.1 Evaluate the available marketing opportunities

This retailing firm emphasizes on the customer retention policy with the help of branding so that it can compete with the other clothing retailing firms effectively (Adair, 2011). Inclusion of menswear and ladies wear is helping the brand in sustaining the retail competitiveness at a much better level. Fashion labels under the brand of Primark are gaining customers with the much focus on quality as well as price of the product. 

 Some of the major marketing opportunities available for the Primark are given below:

Online advertising techniques: Online advertising is one most influential way of attracting the large customer base. With sharp rise in the internet users from 25.9% in 2205 to more than 43.68% in 2014 as per the information given by the London chamber of commerce reports shows that, it is one of the effective ways for creating marketing tactics (Adcock, 2010).  Most of the companies in fashion industry like Zara, H&M and Vero Moda are some of the major companies that have launched their websites in order to attract the customer base. However, Primark has also established in virtual world in 2010 but is not attract the customer base of the some of the loopholes in login page (Anderson and Vincze, 2008).

High Quality strategy: Primark  is using low pricing strategies but company fails to provide the high quality products. Primark sells low quality products which are very much made of the Britlene fiber that gives the evidence of low quality products because currently crylon fiber is in the demand. Primark has been severally criticized for its low products but due to rise in the inflation the Primark is been able to capture the middle class and lower middle age income group (Baker, 2007). Most of the products of the Primark is made up of its own name. However, company promises to offer lower prices   in the high street of UK.  In the UK clothing industry fashion stylist says that Zara deliver fashion and Primark deliver the clothing because of use of cheap materials.  

Brands

Market share %

Zara

24%

H&M

21%

Blanco

6%

Forever

12.5%

Primark

5%

Topshop

3.8%


Figure 1: Market Share of Primark

(Source: Barker and Chitty, 2009, pp-234)

Innovative Promotion activities: Innovative way to promote the products is one of the major opportunities for the Primark. Primark can use various social media platform like Face book, Twitter and Google + in order to create curiosity and high brand value in the mind of consumers (Barlow, 2009). Apart from that, company need to fund more of  CSR activities in order to make sure that it is can increase the customer base via increasing the goodwill of the company in future. Company saves lots of advertising cost by no commercial in TV, magazines and newspaper. Company uses lots of its customer base by word of mouth. 

1.2 Evaluating the risk and returns

Some of the major risks associated with company are given below:

Systematic risk and return: Systematic risks are one of the major risks which can affect due to external nature of business environment. Primark advertising campaign is basically depend upon the WOMO which can go negative way too (Beamish and Ashford, 2012). After the Rana plaza case where most of the worker were dead because of the building has been fell down was one of the major external influence which has affected the company goodwill for a long term.

However, here company has able to gain the large profitability because of manufacturing its products in Bangladesh where labour and clothing are cheaper.

Cost risk: Apart from that, there was cost risk which suggest that, cost  which has been involved by the company like ambient and TV commercial can be very much increase the cost of the company. However, company has also invested in the websites development in  career to introduce the internet marketing (Beck, 2010).  Cost risk is associated with the various forms of the marketing tactics which can go against the company performance. Cost risk can decrease the company profitability which directly affects financial health. 

Here the return is higher as the TV commercial is watched by more than 17 million viewers daily and ambient in highways and retail stores would increase the product awareness among the shoppers. Website development would increase the company profitability by more than 22.7% (Blakeman, 2009).

Demand risk: Demand  in fashion industry is changing frequently which again is one of the major risk associated with it. Since the Primark is known for selling cheaper products which could have been one of the major drawbacks for the company in long run as the people of UK ad Europe are very much fashion and quality conscious (Boone and Kurtz, 2012).  The demand risk can be very much decisive as because company has make changes as per the desire of the consumers wants.  For instance demand for jeans has been deceased from 2010 because of line of chinos came into the fashion. As per the report of the Blumerq suggest that, demand of 30% is higher  for chinos over jeans (Kanabar and Warburton, 2008).

One of the major return would be for the company in this case would be go as per the changing trend of fashion. Company has invested more than £3 million in Chinos manufacturing that would increase the company sales by  8.9% per quarter (Kerzner, 2009).

1.3 Strengths and Opportunities within the organizations


Figure 2: SO of Primark

(Source: Kerzner, 2010, pp-34)

Strengths: One of the marketing strength for the company is its pricing strategies which cheaper in compare to the Zara, H&M and other etc.  Lower pricing strategy would increase the revenue of the company by 23%.  With the low pricing strategies Primark is very much able to gather the customer base by WOMO. During the financial turmoil of 2008 only Primark has able to gain the profitability in compare to its competitors because of its pricing strategies in online shopping too (Finish, 2008). With internet shopping company is able to gain the profitability by 23% from 2009.  Apart from that, company also sales the diverse range of products  such as which products from all ages group like kids, adults and youngster and ladies wear which has gain higher market strength for the company in compare to Vermoda and Zara who are into the business of selling only 18-45 ages group products (Forsyth, 2009).

Opportunities: One of the major opportunities for the Primark would be social media advertising which is helping the company to gain the large market share as there is rise in the internet user in all over the UK is 43% from 2009 (Foxall, 2008). The social media platform like Face book, twitter and YouTube fan page would gain create Primark brand awareness among the consumer which will help the company to retail the potential customer for the company. Apart from these, expansion in BRIC nations like India and China would increase the company customer because the pole in these nations are very much price sensitive (Glynn, 2012).

1.4 Develop Strategies to increases the resources and analyze the gap in the current system

With the help of four Ps of marketing and 5 Cs of situational analysis of marketing will be described:

Product: Primark is known for its changing fashion trends with every month. Primark has introduced various products and simultaneously extinct the products by innovating it.

Figure 3: PLC curve for the Primark products

(Source: Boulding, et al. 2010, p[p-156)

From the above, it has been found that, company has new way of innovating  its jean into jeggins to keep attracting the customer demand for the their products.

Price: Company uses economic pricing strategies to gain the large customer across UK and Europe.

Figure 4: Pricing strategy of Primark

(Source: Bracker et al. 2008, pp-592)

There is gap in pricing strategies as the company uses low quality products and low pricing which is very much affects the business in long run . Everyone in UK and EU are very much concern about clothing quality, comfort and style all of these are missing in the Primark products (Brodie et al. 2009).

Place: Primark stores are usually located in the outback areas of the city. For instance it is generally not located in high street market instead it is located in cheaper and newly areas where there are few customers and because of low rent (Coviello and Winklhofer, 2008). 

Promotions: Company is using low advertising cost because company is using the more of WOMO rather than TV commercial and the Social media advertising which is one of  most popular way to increase the market share in EU and UK specifically in London (Danaher and Johnston, 2009).

Promotional strategies of Primark

Expenditure (%)

WOMO

38.01%

Ambient

22.02%

Websites

18%

Offers, free discounts coupons

9.07%


Graph 2: Current advertising cost of the Primark

(Source: Dant, 2009, pp-54)

Company totally avoids social media marketing which is one of the major gap in the current marketing strategies.

5 s of situation analysis

Company

Company   produces cheap quality products and company poor brand image because of the poor quality of clothing fiber called synthetic fiber.

Collaborates

Company major supplier or rather manufacturing unit is Bangladesh that has created poor brand image of the company in the UK market. Company has produced receivable clothing line that increased the rise in the waste and this called Primark Effect (Darke  et al. 2008).

Customers

 Customer of Primark is very much low level income group and middle level income group. The frequency of change is higher and quantity purchase and major motivation behind the purchase is cost (Dawar and  Philip, 2008).

Competitors

There is bunch of competitors who has outperform the company in the international market like Zara , H&M and the Vermoda because of the innovative marketing tactics and quality products selling (Ferrell et al. 2010).

Climate

Political situation of UK is very much shows the country inflation has been decreased by the 2.5% which shows that purchasing power of the consumer are increasing (Flint et al. 2007). Company has poor operational system known as JIT which is creating the problems because the company is in the expansion phase.

 

 

1.5 Justifying the marketing strategies

Social media marketing strategies: One of the major  of removing the gap within the business is social media marketing. Social media marketing is one of the most influential marketing strategies which killing the customer for Primark (Greenley and Bayus, 2007). With social media Fan page like Face book and Twitter along with Google +  are the new trends in marketing that help the business to create high brand value.

Market Development:

Figure 5: Ansoff matrix on Primark

(Source: Gruca and Rego, 2009, pp-116)

From the above, it has been found that, company need look to develop its products in new market like BRIC nations (Brazil, Russia, India and China) where the people are very much price sensitive rather than quality. This would be prefect market place for the company to increase its revenue and creates positive marketing strategies (Hart and Ellis-Chadwick, 2009). Along with Zara and H&M are still not entered in the Indi and Chinese market.

1.6 Strategies align with organizations strategic direction

Two way Communications: When it comes to the organizational strategies implementations is very much associated with the senior level management strategy.  Moving into the BRIC nations is on e of the major decision making which done by the board of directors of Primark. Tow way communication is one of the best processes to remain contact with customer and employees in order to improvise the company performance in international status (Hauser et al. 2006).

Alignment of resources: Funds and manpower are some of the major resources which is required for expansion in new market along with implementing the social media advertising. Company need to hire the expert for the feasibility report and budget for the gaining the actual idea of expenditure and market entry in BRIC nations (Hellman, 2005).  Apart from that, producing high quality products requires funds and extra manpower in order to capture EU and UK market is one of the major strategies which helps the organization to boost up its sales and creates high brand image in the eyes of the customers.

1.7 Developing the marketing performance review strategies

Marketing vision of the Primark: Primark is one of the very famous  clothing retail store chain that provides clothes to customer at affordable prices.

Objectives after implementing the marketing plan:

  • To earn more than 80% of market share and gain number one position via new ways of marketing activities.
  • To gave customer base of more than 2 million by the next year
  • To achieve the profit worth of 25% growth from 3 year (Heylen et al. 2007).
  • To promote the sustainable products and offer quality products in new market.

With the help of SMART objectives the marketing plan would be discussed:

Specific

The goal of the company is to achieve the number one position in the retail fashion industry which is very much specific goal.

Measurable

Company wants to gain the growth of 25% every annum is measurable because of the changing marketing techniques.

Achievable

It is achievable as the company has implemented new form of marketing strategy called Social media and developing new market for their products.

Realistic

The goal is realistic as the company has enough fund to manage expansion and funds to achieve profitability of 25%.

Time bound

 Company goal is very much time bound as  this can be found from its objectives where company wants to earn more the double the investment after 2nd year. 


2.Plan the marketing tactics

2.1 Detail tactics to implement each marketing strategy

2.1.1 Scheduling of implementation of marketing strategy

Activity

Description

Activity duration (days)

Depends on

A

Choosing the best marketing strategy

(Social media and entry mode)

10

-

B

Tender processing

25

A

C

Work orders

3

B

D

Choosing the entry mode in international market

(franchisee)

60

C

E

Feasibility study

20

C

F

Dummy testing of  Fan page and its accessibility

10

C

G

Investment of funds

15

C

H

Best alternative funding

5

E,F&G

I

Monitoring

10

D&H

J

Final report submission of market development by KPMG

2

I

 

Activity

Depends on

Normal time

Crash time

Normal cost £

Crash cost £

A

-

10

8

49000

60000

B

A

25

24

3000

6000

C

B

3

2

2000

3300

D

C

60

58

600,000

3000,00

E

C

20

19

50000

60000

F

C

10

9

1800, 00

4000,00

G

C

15

13

60000

80000

H

E,F&G

5

4

800,00

90000

I

D&H

10

9

4000,00

3000,00

J

I

2

1

10000

20000


Figure 6: Critical path method for the Primark Implementation strategy

(Source: Created by author)

2.1.2 Costing

Cost Element

Base Estimate

Contingency

Total Estimate

$

 

 

 

 

Project Management

220,000

44,000

264,000

 

 

 

 

Planning

30,000

6,000

36,000

 

 

 

 

Design

 

 

 

Preliminary design of face book fan page

60,000

12,000

72,000

detailed design services for Fan page

300,000

60,000

360,000

design total

360,000

72,000

432,000

 Market Development

 

 

 

property

 

 

 

market value of land in China and India

1,000,000

200,000

1,200,000

variable costs

250,000

50,000

300,000

less: surplus land recoveries

0

0

0

Property Total

1,250,000

250,000

1,500,000

 

 

 

 

Environment

 

 

 

Environmental Compensation

200,000

40,000

240,000

Environment Total

200,000

40,000

240,000

 

 

 

 

Construction

 

 

 

Restaurants construction

 

 

 

Floor construction

1,000,000

200,000

1,200,000

Design

500,000

100,000

600,000

Furniture and fittings

100,000

20,000

120,000

operational construction

200,000

40,000

240,000

Road Construction Sub-Total

2,000,000

400,000

2,400,000

Structural Construction

1,000,000

200,000

1,200,000

 

 

 

 

Construction Total

3,000,000

600,000

3,600,000

 

 

 

 

Construction Supervision

270,000

54,000

324,000

 

 

 

 

Other costs

45,000

9,000

54,000

Other costs total

45,000

9,000

54,000

Past costs

50,000

n/a

50,000

 Total

5,425,000

1,075,000

6,500,000

 

 

2.1.3 Accountabilities

Accountable person  are those who is ultimately leading for the activity or decision making. After proposing the expected cost and expected time for the project of marketing strategy implementation. There some of the person that are needed to be accountable to complete the project (Mohammed and Rashid, 2012). Some of them are project manager, team leader and operation leader etc to complete the project. Apart from that, company owners are also accountable for the project completion because lot of cost and time has been invested in the project.

In order to implement the social media marketing within the Primark, RACI matrix would help to analyse the actual responsible person for the various work.

 

Website manager

Web developer

Content administrator

Web administrator

planning the task

A

R

C

C

Creating a website  

A

R

C

C

Evaluating the content  

I

C

A

I

Testing

I

A

C

R

Installation of tracking software

I

A

 

R

Ongoing review

 

A

 

R

Sales follow up

 

 

 

I


R
= Responsible

A=Accountable

C=Consult

I=Installations

2.1.4 Person responsible

Title

Role

Responsibilities

Project manager

(Social media marketing and market development)

Person who is responsible for delivering the project on time and allocated cost and quality maintained

Managing and the leading ten project team. Project manager co-ordinates staff members and detailed project manager. Providing the current updates of the of the project report to the company. He is solely responsible if anything goes wrong (Mouncey and Baker, 2009).

Site clerk

(entry mode planning in Asian market)

He is in charge of the site and informs everything to the project manager.

Site clerk is responsible for the work which is currently going on the office relocation place (Noble et al. 2008). He inspects all of the clerk and the small members who are responsible for their respective work.

Engineer

(Website manager and web developer of social media)

Person in charge of the technical delivery of the report of implementing technology within the office site.

Engineer has to assemble and implement all of the current technology for which he requires technicians to handle all of the operations. He has to perform all of the IT systems which will be very useful for the company in near future.

Safety officer

 

Person responsible for all of the health safety issues related to project and employee. 

Regular check up of employee health and sub managers. He also prepares for uncertainty occurred on the sites. He gives training regarding the safety issues.

Quality coordinator

(fan page and feasibility rep0rt of the franchisee business)

Responsible for quality check at every stage of the job

Quality controller evaluates every stage of completion of the job and tries to maintain the benchmark set by company at every stage of the work (Pettersen, 2009).

Quality control helps to detect the defects and problems at the time if implementation of the project.

Monitor and evaluation

Responsible for maintaining the smooth flow of work during project completion

During the time of monitoring and evaluation, monitoring manager check every sub manager works and every work at the time of the project completion (Norman et al. 2008).

 

 

2.2 Coordination’s and monitoring mechanism for scheduled activities

Variance Report: Variance report is one of the formal report  which helps to analyse the actual cost and standard cost of the project.  The actual cost achieve on project activity are precisely matches the estimated performance of project planning timings (Lim and Lusch, 2011).  The project planning helps the organizations to estimate standard cost and the actual cost incurred during the implementation of social media marketing page and entry mode of the Primark in the Asian market. The variance report is one of the major ways to keep monitoring on the project actual happenings.

Project running schedule: It is amount of time and resources put into the project related to the major output and outcomes. Implementation of the social media marketing strategy with Primark must be related on the basis of the given time and actual time of the project (Lindgreen and Finn, 2010).  Project scheduling or the rather gannt chart gives an idea of the ascertaining time actual time frame of finishing of the project.

2.3 Tactics meet legal and ethical requirements

Legal requirements:

License

Registrations

Legal site

Primark should look to register their sites in HMRC. The registration comprise of UKreg for domain registration of the social media marketing.

Retail sales (in Asian and Chinese market)

National business license information office  which present in all over the Asian nationals commissions.

Sign permit

Chinese  business license and information service would give the permits (Marinova and Singh, 2008).

Music license

 Environment protection authority permission is needed for the granted for the music in Asian locality which is will based on the place and the location along with  guidelines

Sewerage permits

Environmental law and heritage, 2006 reformed law will be followed to get the permissions


Apart from that, other license would be employee identifications number (EIN), this is tax ID registered for all business in Australia. It can be register online too.

Ethical requirements:

Ethical issues refers to problems, situations or opportunities requiring an individual to choose among actions that may be evaluated as right or wrong, ethical or unethical.

Conflict of interest: Conflicts of interest occur in an organization when employees and organization are engaged in multiple interests. Conflict of interest could be saved by the better code of conduct during the time of implementation of the project via investing the foster relationship (Jones and Hayes, 2008).

Honesty and fairness: Primark, project leader will offer equal opportunities to their employees and remains equitable.  During the implementation of the social media market  no offensive and obscene use of video and pictures are be used (Joshi, 2009). This honesty and fairness within the business would help the company to create positive impression.

Discrimination: Discrimination based on sex, culture, colour and many other factors adversely affects the working environment of the business. Discrimination in any form de-motivates employees and coordination is not achieved (Kim and McAlister, 2011).  For the project, no people are chosen on the basis of colour, race religion, disability or sex which will help the implementation process very smoothly.

 

2.4 Ensure all tactics provide the ongoing review of performance

Risk

Mitigation of Risk

Time risk

Time risk can be encountered only when every work must completed at standard time set by the project manager. With the help of Prince 2 methodology all of the work set according to required data and time will help to finish it. However, chances of uncertainty always are there (Matsuda and Hirano, 2007). 

Over budgeting 

With the help of JIT and wastage control during the project is restricted which will ultimately minimize the risk of over budgeting.

 Prince 2 will help to reduce the cost control the risk.

Implementation of technology

 During the time of implementation of technology a risk is associated to fit as per the company vision which would be help to creates strong brand value Matsuno, K. and (Mentzer, 2009). 

 

Employee safety

Employee safety can be taken care with the proper training and development of during the time of the completing the project.  With the help of safety training chances of misshapen will be less.

Outsourcing risk (supplier risk)

With the help of lean quality management every equipment and services purchased from the suppliers are checked properly with given sample and only then the implementation is done (Pmi.org.uk.2010).

Prince 2 management brings disciplined and quality control in the project.


Conclusion

From the above study, it has been found that Primark is looking to change its market strategy which will help the business to grow and gain the large market share. Currently is using  cheap pricing strategy  in order to cater the large market share of UK. However, company is currently dependent upon WOMO strategy that has now being outdated in the internet age. Therefore company is looking to implement social media marketing and  market development in Asian market to creates large customer base. For which company need to creates right and positive  Face book and Twitter platform. Apart from that, Primark has chosen the franchisee market entry mode in the Asian market because the people in Asia are very price sensitive which is very much align with company vision. During the implementation more than 5000,00 is invested and feasibility report has been made which helps to analyse what cots and actual time of the implementation of market strategy  is placed.

 

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Marinova, D. and Singh, J. (2008) “Do Frontline Mechanisms Matter? Impact of Quality and Productivity Orientations on Unit Revenue, Efficiency, and Customer Satisfaction,” Journal of Marketing, 72, 28–45.

Jones, R. M. and Hayes, S. G. (2008) The UK clothing industry: Extinction or evolution? Journal of Fashion Marketing and Management, 8 (3), 262-278.

Joshi, A. W. (2009) Continuous supplier performance improvement: Effects of collaborative communication and control. Journal of Marketing, 73(1), 133–150.

Kim, M. and McAlister, L. M. (2011) Stock Market Reaction to Unexpected Growth in Marketing Expenditure: Negative for Sales Force, Contingent on Spending Level for Advertising. Journal of Marketing, 75:4, 68-85

Matsuda, T. and Hirano, M. (2007) A perspective of planning literature, European Journal of Operational Planning, 12(2), 138-45.

Matsuno, K. and Mentzer, J. T. (2009) “The Effects of Strategy Type on the Market Orientation-Performance Relationship,” Journal of Marketing, 64 (4), 1-17.

 Websites

Pmi.org.uk. (2010). Welcome to PMI United Kingdom. Available at: https://www.pmi.org.uk/ [Accessed: 7 Mar 2014].

Primark.com, (2015). Primark - What's New. [online] Available at: https://www.primark.com/en/whats-new [Accessed 24 Feb. 2015]

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