Marketing Plan Project Part 2 PDF

1 Marketing Plan Project Part 2 Bhavya Arora, Chris Luu, Jordan Sandhu, Marrik Jones, and Patrick Wang Melville School of Business, Kwantlen Polytechnic University MRKT 1199: Introduction to Marketing...

1 Marketing Plan Project Part 2 Bhavya Arora, Chris Luu, Jordan Sandhu, Marrik Jones, and Patrick Wang Melville School of Business, Kwantlen Polytechnic University MRKT 1199: Introduction to Marketing Rajinder Singh November 21st, 2024 This submission meets the conditions of my signed Academic Honesty Statement on file with the instructor. Patrick Wang (10047558), Bhavya Arora (100475603), Marrik Mueller-Jones (100467536), Jordan Sandhu (100457037), Chris Luu (100475593). MRKT 1199: Introduction to Marketing November 21st  2 Table of Contents Product Decisions....................................................................................................................... 3 Distribution...................................................................................................................................3 IMC (Integrated Marketing Communications Strategy)............................................................4 Pricing...........................................................................................................................................6  3 Product Decisions A.) Types of Product The new hiking shoes that Vessi will carry are a type of product that will fall under the shopping category. Like all of Vessi’s other products, hiking shoes are a form of apparel that people often spend a moderate amount of time comparing different alternatives and searching for the right suppliers. They will come to various stores offering a wide range of hiking shoes, trying on different sizes and selecting one at a price that they perceive as fair. B.) Product Life Cycle The growth stage best fits the current market environment for a hiking shoe. This is largely due to the fact that outdoor equipment in Canada is expected to grow from $1.0 billion in 2024 to $1.2 billion in 2028 (Insights, 2024). Such a rapidly growing market is thought to be caused by not only the country’s vast outdoors, but also its immense wilderness, variety of trails, and beautiful national parks. Additionally, its position in the growth stage is further supported by the forecasted sales for global hiking footwear over the next ten years. From 2023 until 2033, the global value of hiking footwear in USD is projected to increase from $19.70 billion to $26.73 billion (Ronto, 2024). Due to this explosive development, hiking footwear can solidly be placed in the growth stage for the product life cycle. C.) Branding Strategies Brand ownership for the shoes is a manufacturer with a consumer focus. The name for Vessi’s new hiking shoes will be ‘Trail Trekkers’. The brand ownership decision is a manufacturer's brand with a direct customer focus. Brand recognition helps Vessi by using its built recognition amongst consumers to help elevate future promotions regarding the product. This also uses Vessi’s brand loyalty, by making consumers eager to purchase their new product release, this is created through the Vessi brand name and customer trust (Rivas, 2023). Furthermore, hiking shoes will be a part of Vessi’s product line and will be marketed under the Vessi brand name. This strategy will leverage Vessi’s brand equity, “this will allow a maximum return on marketing investments”. This essentially helps make new product introductions to a market, and still maintain customer loyalty (hustlejar, 2024). D.) Service Marketing Vessi’s new hiking shoe idea fits in the middle of the service product continuum. In-store locations require staff who have knowledge on the product trying to increase sales, helping customers find what's best for them and improving store atmosphere thus growing relationships with the customer. This is the only service marketing that would take place and falls into all of the four I’s that follow with service marketing including Intangible meaning they cannot be touched, Insertable production and consumption meaning that in-store locations with employees, the customer is not separate from the consumption while the service is ongoing, Inconsistent meaning that with a human trying to improve higher quality service often at times, the result may  4 not go the way intended to there for being inconsistent and lastly Inventory meaning this service offered cannot be stored in the back of the store waiting for usage. (Grewal, 2023) Distribution A.) Main distribution channel(s) The most potential channel structure for Vessi is a multi-channel distribution system. They began with having an online presence where they sold directly to customers from their website. Vessi grew their company large enough to even have their own in-person stores selling its manufactured products. Along with their direct distribution, they also have an indirect distribution where they service their products to many other retail chains throughout Canada and the US. This allows Vessi to expand their reach and gain more awareness for this new product (Patterson, 2024). B.) Types of intermediaries Due to Vessi primarily utilizing a direct-to-consumer model with their brand, they maintain and also require very little when it comes to intermediaries. However, as of recently, Vessi has been expanding their reach by providing their shoes to more retailers and they have opened a few of their own stores as well. Interestingly, Vessi also has initial plans starting in 2025 to look into expanding into the United States market, and with it, also considering wholesale as an option as well. This is likely to expand their reach, and to get more potential customers involved with their brand (Patterson, 2024). C.) Draw your channel structure  5 D.) Distribution intensity The most optimal distribution intensity for the new hiking shoes is a selective distribution strategy. This is the best choice as it gives the perception of having higher value than items sold using intensive distribution while also staying accessible compared to exclusive distribution. This upholds Vessi’s perception as a quality brand that sells premium apparel at an affordable price. It gives the new product strong exposure by offering a wide reach throughout Canada and the US as well as maintaining the value that people look for. (Vessi 2024). Having select distribution channels also optimizes relationships between Vessi and their retailers. This creates more opportunities for Vessi to focus their marketing efforts on key retailers to produce better-targeted promotions (Guerrero, 2024). IMC (Integrated Marketing Communications Strategy) 1. IMC Objectives Informing is the first major IMC objective that Vessi should utilize, as while they are no longer a small business by any means due to their revenue exceeding tens of millions, they are still relatively unknown (Ciment, 2024). The other objective that Vessi needs to prioritize is persuading. This is largely because of the immense amount of competition that currently exists within the waterproof hiking shoe market, and they must differentiate themselves in order to stand out from other bigger established companies such as Columbia or Salomon. 2. Promotional Mix A. Advertising Vessi should take advantage of paid communications such as informative advertising in order to inform users of Vessi’s new hiking shoes. A form of informative advertising Vessi could take advantage of the advertising medium, internet advertising (Sela, 2023). Such as social media posts on Instagram, TikTok, Facebook and YouTube.​​These posts will feature Hikers in a beautiful hiking spot, using hiking shoes to climb and go through all kinds of terrain. The hikers will smile by the end of it, showing a close-up of the shoes, similar to how previous Vessi products have been advertised through media channels. Once the brand has established its new product, Vessi can reinforce the product's presence and sales by using persuasive advertising, this can be done through the use of paid ads on apps and websites like Spotify, YouTube, and other auditory-based media channels (Rock Content, 2023). This advertisement would use keywords based upon what outdoorsy people want to hear when learning about a new hiking shoe, such as breathable, lightweight, waterproof, durable, eco-sustainable, and environmentally friendly to make it stand out to listeners. B. Direct marketing Using direct marketing, Vessi’s first objective would be an offline form of direct marketing which would be a Kiosk set up in a mall where it is busy and people will see, the objective of this is to create awareness to the brand mainly rather than getting sales. The reason for this is we just  6 launched this product and not many people would be aware of it therefore this kiosk can create awareness in high-foot trafficked areas in malls. This kiosk would be heavily focused on the new hiking shoe but digital displays of Vessi’s other shoes will be up with possibly a larger store located in the mall. Using this kiosk we can also create surveys for people to fill out to get discounts at the store. These surveys will help get a better understanding of the consumers but it will also generate a list of emails to help with an online form of direct marketing that we would use which would be emails directed to people who like outdoor kinds of shoes and the people who signed up and consented to receive emails from Vessi. (Grewal, 2023) C. Digital media To promote Vessi’s new hiking shoe, they will engage with current social media trends and gain more engagement and brand recognition. Participating in TikTok trends where the new hiking shoe can be shown as the new must-have shoe for outdoor/adventure-oriented people. This can also show how much Vessi cares about customer feedback, this is a way to excite people about the upcoming new hiking shoe. Vessi will also be partnering with influencers to build trust and educate the customers about the brand-new hiking shoe. Partnering up with outdoor, fitness, and adventure influencers, this can demonstrate the shoe in real-world hiking and outdoor scenarios showcasing its unique features in a trustable manner. Vessi will give early access of the shoe to influencers, for reviews, and possibly host an influencer program to create a long-term relationship. Another way to promote and keep the customers engaged is by using customer experiences to speak for the brand. Encourage the customers to leave reviews and share their experiences with the hiking shoe, focusing on its qualities. This will influence potential buyers, and make them satisfied with their purchase decisions. This keeps the customer engaged with Vessi. (Boufous, 2023) D. Sales promotion One sales promotion strategy that Vessi should continue to implement is its use of premiums. This Integrated Marketing Communication strategy seems to be highly effective as shown in their more recent store openings at CF Richmond Centre. Vessi was able to draw in hundreds of new and existing customers to their new store location with the line-up wrapping throughout the entire mall (TikTok, 2024). This strategy of offering a high-valued in-store gift to the first 600 people on opening was extremely successful. Vessi’s objective for this hiking shoe is to bring more awareness to this new product release. To increase this new product's visibility, Vessi should offer additional in-store gifts along with the purchase of the new hiking shoe. This will provide a strong incentive for new and existing customers to purchase a pair (Middleton, 2024).  7 Pricing 1. Company Objectives The new hiking shoe from Vessi will use customer retention as its company objective. This can be accomplished by “setting prices that are attractive to repeat buyers” (Thomas, 2023), resulting in those consumers having a long-term relationship with the brand. Some of the ways to improve customer retention are by “offering exemplary customer service, investing in a solid customer success team, and creating customer loyalty programs” (Fuchs, 2021). 2. New Product Pricing Strategy To improve Vessi’s pricing strategy, Vessi could offer alternatives for the hiking shoes, by proposing a standard shoe for $265, and a premium version for $300, which could offer better features and better for the environment to appeal to outdoorsy people (Gregory, 2024), the small price difference between the two makes it appear as though the premium version is a no brainer for any hiking enthusiast. Vessi could also use Dynamic Pricing, which is a pricing model that utilizes ai in order to allocate its price based on supply and demand, similar to Wendys and Nike (Cuofano, 2024), leading to more profit and optimizing the sales per shoe. 3. Pricing Elasticity Although the general shoe market as a whole could be considered inelastic, waterproof hiking shoes fit squarely into the elastic category. This is caused by the many existing competitors who all have their own different products with possibly similar features, and if Vessi were to increase their prices consumers would simply look at other brands instead (Federal Reserve Bank, 2024). 4. Selling Price, Discounts When it comes to the selling price of the shoe, it will be around 265$ when it first officially drops plus a 20% discount within the first 2 weeks of the product being sold but later on as its life continues, that 20% discount will no longer exist. Discounts for this new hiking shoe can only be found in emails sent to the customer, these discounts will vary from 10-40% off the shoe and are typically seasonal discounts. As seasons change and winter time rolls around, there will be discounts of 10-20% where once the winter season is over, a discount of 30-40% can be found to increase the sales for the warmer weather when waterproof shoes aren't needed as much. (Grewal, 2024)  8 References Boufous, M. (2023, November 10). Ads marketing strategies in the shoe industry [ideas and examples]. Marketing. https://www.panoramata.co/benchmark-marketing/ads-marketing-strategies-shoe-industry- ideas-examples Cuofano, G. “Nike Pricing Strategy.” FourWeekMBA, What is The FourWeekMBA, (24 June 2024), fourweekmba.com/nike-pricing-strategy DealHub Experts Reviewed By Gideon Thomas Published December 20, Experts, D., Experts, D., Thomas, R. B. G., & Thomas, G. (2023, December 20). Pricing objectives. DealHub. https://dealhub.io/glossary/pricing-objectives/#:~:text=Pricing%20Objectives%20are%20t he%20goals%20a%20company%20aims%20to%20achieve,or%20establishing%20a%20br and%20position. Federal Reserve Bank of St. Louis, St. Louis. (2024, April 30). Elasticity of demand - the economic lowdown podcast series. Saint Louis Fed Eagle. https://www.stlouisfed.org/education/economic-lowdown-podcast-series/episode-16-elastic ity-of-demand#:~:text=Using%20economic%20terms%2C%20consumers%20will,will%2 0likely%20be%20price%20inelastic. Fuchs, J. (2021, February 26). Pricing objectives: What they are and why you need one. HubSpot Blog. https://blog.hubspot.com/sales/pricing-objectives Grewal, Dhuve. Pricing concept and strategies. In Marketing (pp. 330-361). McGraw Hill. Retrieved 2024 https://prod.reader-ui.prod.mheducation.com/epub/sn_4fca3/data-uuid-3d485ca9aa3c4f209 86395505bd82dd3#data-uuid-edc052d5579b4db5a99cf128587473e3 Grewal, Dhuve. The Intangible Product. In Marketing (pp. 303–307). essay, McGraw Hill. Retrieved 2024 https://prod.reader-ui.prod.mheducation.com/epub/sn_4fca3/data-uuid-6ffe05b983de4749a 45eb33fa9753244. Grewal, Dhuve. Integrated marketing communications. In Marketing (pp. 445). McGraw Hill. Retrieved 2024 https://prod.reader-ui.prod.mheducation.com/epub/sn_4fca3/data-uuid-3d485ca9aa3c4f209 86395505bd82dd3#data-uuid-edc052d5579b4db5a99cf128587473e3  9 Gregory, L. “Nike’s Marketing Mix (4P) Analysis.” Panmore Institute, 13 Aug. 2024, panmore.com/nike-inc-marketing-mix-4ps-product-place-promotion-price-analysis. Guerrero, O. (2024, September 25). Selective distribution: Maximizing Brand Potential Strategy. Order In Seconds. https://ordersinseconds.com/brand-potential-with-selective-distribution/#:~:text=In%20su mmary%2C%20selective%20distribution%20is,quality%20of%20their%20product%20dis tribution. Hustlejar. (2024, June 25). Brand leveraging examples: Comprehensive guide. Hustle Jar. https://www.hustlejar.com/post/brand-leveraging-examples-comprehensive-guide#:~:text= This%20approach%20capitalizes%20on%20your,maintaining%20consumer%20trust%20a nd%20loyalty. Insights, S. M. (2024, July). Outdoor Equipment - Canada: Statista market forecast. https://www.statista.com/outlook/cmo/toys-hobby/sports-equipment/outdoor-equipment/ca nada Make your day. TikTok. (n.d.). https://www.tiktok.com/@helenbynature/video/7435353040950971704?is_from_webapp= 1&sender_device=pc&web_id=7405765968251897360 Middleton, C. (2024, November 7). Vancouver’s getting a brand-new Vessi store with a fun grand opening event: Curated. Vancouver’s getting a brand-new Vessi store with a fun grand opening event | Curated. https://dailyhive.com/vancouver/vessi-cf-richmond-centre-store-opening-vancouver Patterson, C. (2024, November 13). Vessi expands with new stores across Canada. Retail Insider. https://retail-insider.com/retail-insider/2024/11/vessi-expands-with-new-stores-across-cana da/ Retailers. Vessi Canada. (n.d.). https://ca.vessi.com/pages/retailers Rivas, D. (2024, October 7). What are the two basic types of brand ownership strategies? Digital Media Ninja. Digital Media Ninja. https://digitalmedianinja.com/blog/what-are-the-two-basic-types-of-brand-ownership-strat egies/ Ronto, P. (2024, March 25). Hiking Shoes statistics. RunRepeat. https://runrepeat.com/hiking-shoes-statistics  10 Sela, R. (2024, October 16). The basics of informative advertising. Ron Sela. https://www.ronsela.com/informative-advertising Writer, R. C. (2023, May 16). Discover how persuasive advertising can bring in new engaged audiences. Rock Content. https://rockcontent.com/blog/persuasive-advertising