External Factors And Forces Affecting The Market Marketing Essay
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In todays world where time is of essence and mobility is indispensable. Smartphone or tablet users do feel the need to project and share their work on the go, be it pictures, videos, presentations, watch movies or play games on a larger screen but are often constrained due to bulky and wired projectors and at times incompatibility with all smartphones and tablets. SMART Project is just the answer to this.
SMART Berhad, is a newly formed IT company which manufactures SMART, Intelligent and compact IT products for its customers. SMART Berhad is owned by the Malaysian Multi National Company, MAXIS Communications Berhad, which is also the leading communications provider in Malaysia.
SMART takes pride in introducing the first 'All in one' portable projector that can also be connected to 'All' smartphones and tablets by establishing a Bluetooth connection.
The SMART Project will be available in the market with a wide range of colors and for all genders. A price tag of RM300 (for the basic version) and RM500 for the high end version (for professional usage) does give SMART Project the competitive edge over its rivals
Profitability
Future prospects:
Smart phone users in Malaysia which is currently 22% is set to increase to 75% by 2016
Tablet industry in Malaysia showed a record growth of 87% in 2012
Global projector market which was $ 0.49 billion in 2011 is expected to grow at an Annual Compound Growth Rate of 75% as projected till 2016. Which will reach to $8.12 billion in the year 2016.
Age division of Smartphone and Tablet users shows that maximum users for these devices are in the age range of 15-45years which is the targeted market for SMART Project.
Taking into consideration the above booming factors in the local as well as International market, sales of SMART Project is expected to grow at a rapid pace. This growth will be profitable to the company in generating more revenues for expanding the business locally and later penetrate into the International market.
Risk
SMART Berhad being a newly set up company will require a high capital for marketing the product and placing it into the minds of potential buyers. The company is expected to face teething problems which in general any startup companies would.
Future economic slowdown that would hit hard on the IT industry would also decline the sales of smartphones and tablets which will indirectly affect the sales of the SMART Project.
Product will be competing with other existing products.
New companies incorporating similar features in future which will penetrate into the local market.
Key elements of success
Substantial increase in smartphone and tablet users in Malaysia and growing global demand for pico (hand carried compact) projectors.
SMART Berhad is owned by MAXIS Communications Berhad which is Malaysia's leading communications provider.
MAXIS carries a strong brand name.
Parent company possesses knowledge of the local market and experienced sales team.
Favorable access to distribution networks through MAXIS.
Can use similar distribution channel as parent company and use the MAXIS advertising to its advantage.
Compatible with all smartphones, android, ios devices.
Light in weight and small to fit into pocket.
Cheapest pico projector in local market.
Wirelessly connect to all smartphones and tablets.
Experience of carrying your own personal Mini Theater on the go.
Forecast increase in smartphone and tablet users in Malaysia and global increase in pico projector sales.
2.0 Situation analysis
2.1 External Factors and Forces Affecting the Market
The scan of the external macro-environment in which the firm operates and is expressed in the terms of the following factors:
Political
Economical
Social
Technological
Political Factors - include government regulations and legal issues and rules under which the firm must operate. These include.
Tax Policy: As stated in Asistrade hub, all income of companies derived from Malaysia are liable to tax.
Apart from income tax there are other taxes, such as property gains tax, indirect taxes like service tax, sales tax, excise duty, import duty etc.
According to the Official Assessment System Income tax is assessed on the income in the preceding year.
A tax rate of 28% is applicable to resident as well as nonresident companies.
Sources of income that are liable to tax and that would affect the company directly or indirectly are:
Gains and profits that arise from the business
Employee salaries, gains, profits etc
Dividends gained, interests on dividends etc
Rents, Pensions and other profits of an income nature.
The above mentioned factors have been taken into consideration as it would would affect the Net earning capacity of the company.
Source: http://www.asiatradehub.com/malaysia/tax1.asp
Employment Laws - As per Malaysian Employment Act 1955 (Act 265) as stated in ILO. These laws are considered prior employment which includes but not limited to:
Probation
Entitlement of leaves
Rest day
Hours of work per day
Overtime
Public holidays
Termination of services
Other factors that are to be considered over and above are the
Environmental Regulations
Trade restrictions, tariffs
Political Stability
Source: http://www.ilo.org/dyn/natlex/docs/WEBTEXT/48055/66265/E55mys01.htm
Economic Factors - These affect the customer's purchasing power and the company's cost of capital. They affect the customer needs and also the size of the potential markets.
Economic growth - Which is the steady growth in the productive capacity of the economy that directly affects the growth of the organization. Economic growth directly relates industry and purchasing power of people and organization increases and vice versa.
The economic growth affects the purchasing power of customers and has been taken into account. Product launch is planned when the Malaysian economic growth is forecasted up hill.
Figure 1 in Appendix 1 shows the chart of the GDP growth in Malaysia.
Other factors that relate to the Economic Factors and considered in the Marketing plan are interest and exchange rates, inflation rates.
Social Factors - They are the cultural aspects of the external macro environment. They affect customer needs and potential market size. Below are a few of these factors
Population growth: The population growth is one of the major factors that has been considered in the Marketing Plan. A growth in population means more potential buyers and more needs from the market and vice versa.
As can be seen from Figure 2 in Appendix 1, the population in Malaysia is growing at a steady pace which means more needs from the consumers and more opportunities for the organization to meet those needs.
Other important factor is the Age distribution - SMART Project market is targeted as per the country's age distribution which in turn provides more opportunities for the sales of the product. Refer to figure 3 in Appendix 1.
Technological Factors - As technology changes constantly, business must also change in order to keep up to the current expectations and requirements from customers. This will require some products to be rejuvenated and new products to be launched. The techoniligical factors affect the market in three ways.
Production
Workers
Marketing
These factors have positive and negative impacts in the market and which are also considered in preparing the Market Plan
2.2 Organization Profile
2.2.1 Background history
SMART Berhad is a newly set up company that manufacturers Intelligent, Smart and compact IT products. SMART aims in solving common problems most gadget users face due to lack of compatibility, mobility and connectivity. SMART Berhad is owned by Maxis Communications Berhad which is a mobile network operator with approximately 13.8 million subscribers, of which revenue generating subscription base of 12.7 million. Maxis is the leading communications provider in Malaysia.
Source: http://maxis.com.my/personal/about_us/investor/financial/Press%20Release%202.pdf
Maxis Background:
Type - Public Listed
Traded as MYX:6012
Industry - Telecommunications
Founded - 1993
Headquarters - At Maxis Tower, Kuala Lumpur, Malaysia
Area served - Asia
Key people - Sandip Das, (CEO)
Revenue - 9.0 billion MYR (2011)
Parent - Usaha Tegas Sdn Bhd
Subsidiaries - Aircel
Products and services - Maxis provides variety of cellular communications products & services. Maxis also provides the following services for prepaid and post paid plans, Broadband Internet plans, 3G services, VSat services.
Maxis is the founder of Malaysia's first NFC (Near Field Communication) service called FastTap which integrates Touch' n Go and Visa Wave from Maybank.
Source: http://en.wikipedia.org/wiki/Maxis_Communications
Below is the planned organization chart of SMART Berhad
Board of Directors
From Maxis Communications Berhad
CEO
From Maxis
Operations
New from SMART
Marketing
New from SMART
Administration
From Maxis
Production
New from SMART
Sales
New from SMART
Finance
From Maxis
Advertising
New from SMART
Customer Service
New from SMART
HR
From Maxis
System and subsystems are found within the business activities
Accounting
Payroll
Collections
Hiring
Training
Manufacturing
Inventory Mgmt
Quality Control
Purchasing
Maintenance
Lead Generation
Lead Conversion
Sales Presentation
Product Testing
Pricing
The above tabulations shows that since SMART Berhad is a newly setup company and is owned my Maxis berhad. Many of the key indicators including the Board of Directors, CEO, Admin, Finance and HR will be handled by Maxis.
SMART will also occupy the office space in the currently existing Maxis Tower, which also eliminates the monthly recurring cost such as lease etc.
In this was SMART will be able to increase the productivity, concentrate on Sales and will be able to Break even at an earlier stage.
2.3 Industry / Market Analysis
2.3.1 Marketing definition
As Karunakaran (2008, p.1), states, that the current market in the extremely competitive economy is no longer the producers but the buyer's market. Buyers can make or break a company. Customers who were initially treated like Kings are now being treated as Gods.
According to Karunakaran (2008, p.3) In order for a company to succeed in the present competitive scenario, they have to be totally customer oriented and should 'think customer', 'smell customer', live for customer' and 'build customer relations'.
2.3.2 Main market segments and their size
Market segmentation is the initial step in the marketing strategy. Second step is target marketing, which is done by evaluating each markets segments attractiveness and there by selecting once or more segments to enter. Precise marketing mix must be decided in order to attain this, the factors being product, price, place and promotional appeal for each segment. The third and final step is the market positioning, which places the product at a well-defined place as compared to its contenders and into the minds of target customers. (Karunakaran, p.39)
Considering the above, the market segments that compliment the SMART Projector are mainly the Smartphone and Tablet users who operate either on Android or ios platforms.
The SMART Project is designed for the above mentioned users and the increase in sales of these devices will in turn open up more opportunities for the SMART Project market.
The market is segmented by identifying and splitting it down by predetermined criteria into meaningful buyer groups so that the product may satisfy the needs of a particular group(s). Using this principle, the SMART Project market is segmented into all smartphone and tablet users, including but not limited to home users, students, corporate users and sales personnel.
As per indexmundi, 17.2% of the Malaysian population is aged between 15-24 years and 41.2% are ranged between 25-54 years. Considering this the targeted population in Malaysia for SMART Project are males and females in the age group of 15-50 years
Source: http://www.indexmundi.com/malaysia/age_structure.html
For SMART Project, the above market segmentation is measurable, identifiable, acceptable, substantiated and meaningful to the business, sustainable and viable.
Home users are classified as 'light users' as most of them have unrestricted access to either televisions, DVD players, gaming devices, connecting cables and other accessories that would does not restrict them from viewing on a larger screen..
Students are classified as 'heavy users' as majority of them are tech savvy and would want to avail the features of portable projection, be it for gaming, watching videos, images, conducting a group discussion or surfing the net and video chatting. They can also enjoy watching Movies on a larger screen by having their own personal, portable theater on the go.
Corporate users are classified as "Medium to Heavy". Most companies would have a projection room, where the slides and work could be projected. However the meeting rooms are limited and would require to be booked in advance. The SMART Project could be a quick alternative solution to the above limitation. The projection could be projected at any convenient location or substitute rooms that do not avail the fixed projection facility. Moreover the SMART Project being able to wirelessly connect to the device, the user is mobile in his operation up to a range of 10 meters.
Sales personnel are classified as "High users" as often they would want to present their works to clients, which if informed on a short notice would not allow the projector enabled meeting rooms to be booked in advance. Moreover the sales personnel can avail this facility of displaying their work at any other convenient location on the go.
Smartphone market in Malaysia
Figures 4 and 4a in Appendix 1 shows the following
Current and projected Smartphones growth in Malaysia
Smartphones subscribers market in Q4 2012
Tablet market in Malaysia
As per Adiomagazine, the Malaysian tablet industry showed a record growth of 87% in 2012, with approximately 823,000 units being sold i.e. 384,000 units more than the previous year.
Growth of the Tablet industry reached US$ 415 million, the main contributing factor that compelled customers was a price slash which increased the affordability of the tablets.
Number of tablet brands also grew from 18 in 2011 to 35 in 2012.
Source: http://adoimagazine.com/index.php/news/1-breaking-news/8916-tablet-industry-marked-milestone-growth-in-2012
Advertised in The Malay mail and as in Figure 5, the tablet penetration for Malaysia is second highest in the region behind Singapore. Owing to the increased in interest of customers the tablet penetration in Malaysia was expected to triple by the end of 2012 and further increase in 2013.
The above factors show the potential of SMART Project in the Malaysian market.
Global Pico projector market
As per Market Research, the global pico projector market produces revenues of around $0.49 billion in 2011. This figure is expected to grow at an Annual Compound Growth Rate of 75% as projected till 2016. This market is expected to reach to $8.12 billion in the year 2016. Research expects that the increased use of embedded products in devices like smartphones, tablets, digital cameras, gaming stations etc and the miniaturization of high end projectors for professional use will lead to a higher revenue growth.
This means that once the product is successful in Malaysia it would be taken to the International Market. The product when being taken into the International market would require rejuvenation as per the demand and trend of the International Market. Also the pricing strategy will be considered, taking into account the competitors in that region, the average income of people, needs of customers and the advertising required to launch the product on an International platform.
Source: http://www.marketresearch.com/GBI-Research-v3759/Pico-Projectors-Application-Portable-Devices-7025812/
2.3.3 Global competitors and Competitive forces
Below table shows the price comparison and features of the SMART Project to that of its top competitors
Company
Brookstone
Aiptek
General Imaging
Acer
3M
SMART Project
SMART Project
 Product Name
HDMI pocket projector
Mobile Cinema i20 plus
ipico
C120
Streaming Projector
SP-B
B-basic
SP-A
A-advance
Price
RM 927
RM 388
RM 403
RM 778
RM 837
RM 300
RM 500
Dimentions weight / size
0.2kg
2x10x10
0.1kg
2x5x6
0.1kg
0.2kg
3x12x8
0.3kg
5x11x11
0.1kg
2x4x7
0.3kg
4x12x12
Compatibility
Digital input
HDM1
X
X
X
HDMI
HDMI
HDMI
Standard video
√
X
X
X
√
√
√
Personal computers
√
X
X
√
√
√
√
Light Source
Type
LED
LED
LED
LED
LED
LED
LED
Life
20000hrs
20000hrs
20000hrs
20000hrs
20000hrs
15000hrs
20000hrs
Display
Native Resolution
854x480
960x540
960x540
854x480
854x480
854x480
960x540
Aspect Ratio
16:9
WGVA
16:9
WGVA
16:9
WGVA
16:9
WGVA
16:9
WGVA
16:9
WGVA
16:9
WGVA
Std. Lens
Focus:Manual
√
√
√
√
√
√
√
Zoom
X
X
X
X
X
X
√
Special features
USB port
√
√
√
√
√
√
√
Bluetooth Connectivity
X
X
X
X
X
√
√
SD Card
X
X
X
X
X
X
√
Speakers
√
X
X
X
√
X
√
Color range
X
X
X
X
X
√
√
Compatibility with smartphones and tablets
Requires additional adapters and micro cables to be purchased
Requires additional adapters and micro cables to be purchased
Requires additional adapters and micro cables to be purchased
Requires additional adapters and micro cables to be purchased
Requires additional adapters and micro cables to be purchased
Bluetooth connection with devices
Bluetooth connection with devices
Competitor's data sourced from: http://www.projectorcentral.com/popular-pico-projectors.htm
The additional features of the SMART Project are distinguished by the items highlighted in 'Red'
From the Comparative table it is made evident that the SMART Project has all the advanced features embedded into it, along with additional features like the Bluetooth connectivity with all smartphone and tablets which eliminates the additional cost of purchasing separate adapters and connection cables.
The advanced model also has an SD card feature that can store data up to 8GB which can remotely project images, videos, movies, slides, presentations etc.
Considering the advance features, mobility and the price affordability SMART Project has not compromised on the video resolution and quality of the product. Moreover it provides an extended warranty up to 2 years.
As per Havard Business Review the 5 competitive forces in the industry are shown below, which are taken into consideration for developing the features and establishing an attractive price tag for the device.
The above imbedded features along with a cheap price tag, wireless connectivity and compatibility with Smartphone devices and Tablets, the SMART Projector will in no tome become a necessity for every user.
Potential Entrants
(Threat of Mobility)
Suppliers
(Supplier Power)
Buyers
(Buyer Power)
Industry Competitors
(Segment Rivalry)
Substitutes
(Threat of Substitutes)
The Five competitive forces
Source: http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/
2.4 Marketing Issues
2.4.1 SWOT Analysis
Taking into consideration the SMART Project and the competition in the existing pico projector market the SWOT analysis has been prepared.
Environmental factors internal to the firm are classified as strengths (S) or weakness (W), and those external to the firm are classified as opportunities (O) or threats (T).
As per Havard, the SWOT analysis is based on the model as shown in figure 6 in Appendix 1.
SWOT/TOWS Matrix below table has been simplified, which shows the strategies that the company needs to follow depending on the Internal Strengths and Weaknesses as compares to External Opportunities and Threats
Strengths
Weakness
Opportunities
S-O strategies
W-O strategies
Threats
S-T strategies
W-T strategies
Figure 8 TOWS Matrix
Source: http://timmermansconsulting.nl/en/overige-diensten/
(S)-(O) tactics hunt opportunities that are good fit to the company's strengths
(W)-(O) tactics conquer weakness to pursue opportunities
(S)-(T) tactics recognize ways that the firm can use its strengths to reduce its vulnerability to external threats
(W)-(T) tactics create a defensive plan to prevent the organization's weaknesses from making it very vulnerable to outer threats
Strengths
SMART Berhad is owned by MAXIS Communications Berhad. Maxis has the advantage and knowledge of advertising in the local market, understands the psychology of buyers, has got various distributors and galleries.
MAXIS carries a strong brand name which has over the years acquired customer faith and satisfaction in their services, SMART Berhad has an added advantage of being a part of Maxis as customer would anticipate the similar product quality, customer satisfaction and post sales services and support.
Parent company possesses knowledge of the local market and also is well verses with the marketing tactics.
Favorable access to distribution networks. SMART Berhad can use to its advantage the distribution networks of the parent company and place their products at the same retail outlets and galleries.
The additional strengths of the SMART Project are
It is compatible with all smartphones, android, ios devices and tablets and can be wirelessly connected by establishing a Bluetooth connection which does not require additional cables to be carried.
SMART Project is an all in one package as it has incorporated all the features into a single device which is compatible with smartphones and tablets. Considering the all in one features and compatibility, it is the cheapest product in the existing market with a wide range of price tags. The lower one that suits students, low income group and as the price tag advances it suits the corporate and average to higher income groups as well as to sales personnel for professional use.
Light in weight, can be easily accommodated into ones pocket.
Users can enjoy the experience of wirelessly connecting their devices to the SMART Project and enjoy the overall experience of projecting videos, images, net surfing, video chatting, project sharing etc.
SMART Project also gives you a complete experience of carrying your own personal Mini Theater on the go.
Corporate users and Sales personnel can also remotely present their projects and slides.
No separate meeting rooms with projector facilities required as SMART Project solves this problem.
This product would benefit not just few but 'ALL' smartphone, android, ios and tablet users.
It is an extremely handy tool which meets the day to day needs of students, corporate group as well as sales personnel, as they would be having the liberty and benefits of projecting anywhere, everywhere.
Weaknesses
Being a new product in the market it would require extensive marketing in order to place the product into the minds of all smartphone, android, ios and tablet users.
SMART Project will be competing with the existing pico project (hand held projectors) manufacturing companies.
High cost structure - Since SMART Berhad is a startup company, it will require a high Capital for setting up the organization, manufacturing products, establishing relationship with distributors.
Difficulties in setting targets and measuring performance
Initial difficulties in motivating employees and maintaining employee interrelationship
Initial problems that would be encountered during Licensing, Permits, Registrations and Legal formalities.
Teething problems
Operational expenditure (OPEX) on advertising the product through various advertising channels.
Penetrating into the current market and brake even to cover up various costs.
Cash flow problems
Stock holding and record keeping
Initial difficulties in placing the product into the minds of customers.
Opportunities
No existing pico projector has the complete set of features into one model that is specifically designed for smartphone and tablet users. SMART Project has this advantage as it incorporates complete compatibility and features in its single device.
Existing products are expensive and does not cover a wide range for targeted customers.
Product will be launched during Chinese New Year which would maximize sales.
Product has been designed by taking into consideration the average monthly income of the Malaysians and the local target market of smartphones and tablets.
Threats
Competitors having similar products
Competitors launching new advertising campaigns
Competitors expanding and the market and incorporating the products current features
New competitors penetrating the local market.
Competitors opening shops close to the distribution outlets
Competitors slashing prices of the existing product and incorporating additional features and schemes
3.0 Objectives
3.1 Organization Profile and Marketing Objectives
To be successful in a competitive and stable business environment, achieving results with exemplary leadership.
VISION
Maintaining efficiency through effective cost control and profit maximization
Providing a safe, conducive and quality working environment.
Total customer satisfaction
MISSION
People development
Brutal openness
Customer focus
Hands-on execution
Commercial awareness
CORE VALUES
GOALS
LONG TERM
Make the brand known in the International market
To be the customers preferred brand
To increase market share by 20% in 2years
To increase competitive edge by establishing stronger corporate image
SHORT TERM
Create brand awareness to a level of 10% of consumers in the first 12 months.
Getting into immediate profit as soon as possible
Increase sales and keep expenditures within the allotted budget
Establish bond with suppliers and agencies
Win the hearts and minds of customers
Marketing Strategy
4.1 Target Market and Market Communication Strategy
As per Kurtz, Dave. (2010) target market is a group of consumers that the business has decided to aim its marketing efforts and ultimately its merchandise towards.
The Target market as observed from the below graph for for SMART Project is customers in the age range of 15-50 as seen in figure 7 Appendix 1 .The population in this age range are techno savvy and are the maximum purchasers of smart phones, android, ios devices and tablets. These customers could in turn use the SMART Project in conjunction with their existing devices in order to avail the facilities provided by SMART Project.
Marketing the SMART Project to this targeted market will in turn generate maximum revenues and sales for the company in the shortest possible time.
Advertising
SMART Berhad being a startup company with a new product will follow the following strategies.
Initially target the market in Kuala Lumpur, as the sales of smartphones and tablets is the most in Kuala Lumpur as compared to other cities in Malaysia.
Deploy entire sales force to create awareness and demonstrate the product in the Kuala Lumpur market.
Utilize 7.5% of the allocated budget in advertising. As can be seen from the budget forecast table in Section 5.
Product will be advertised in newspapers, radio and IT magazines.
Contest can be executed in conjunction with special occasions that will entitle people to win discounts on the product.
Target major shopping malls, IT malls and super markets across Kuala Lumpur, conduct road shows in those malls and place the product at major retailer outlets besides the hot selling product.
Place the target into the minds of customers. Once the product is successful in Kuala Lumpur the sales force will be increased and other major cities in Malaysia will be targeted.
Public Relations
Establish a stronger corporate image through weekly sponsored advertorials in local newspapers and magazines.
Sales Promotion
Sales promotion to boost sales and to meet sales target, especially during seasonal period, a time when most look for an opportunity to shop.
Trade promotions can also be carried out to gain trade support, especially to large retailers, which constitute 40% of the retail volume.
Direct Marketing
As it would be difficult to capture the remaining 60% of the market volume, direct marketing would prove to more cost effective marketing communication tool used to achieve sales and gain strong support from the balance trade i.e. single, small and medium retailers.
Direct Marketing objectives
To build long term profitable relationship with new customers
To form a more personalized communication between the company and potential customers where other conventional media is unable to achieve
To achieve higher sales response rate cost effectively through integration with the rest of the proposed marketing communication tools.
Database Marketing
Database will be set up in order to understand customer's motivation and preference. With that, a more customized offer can be made for future marketing plans base on the customer's sales record information.
This will help create a systematic approach to identify and classify prospective customers.
Direct Marketing Strategy
Direct mails will be sent to prospective customers informing them about the new product launches and new features according to their interest.
Customers shall be informed of the various discounts and offers on products.
Direct response through radio shall be implemented together with the advertising and promotional efforts. Toll free numbers shall be included so that interested customers can make inquiries of existing and new products as well as make direct orders.
Media
Various media comprising of Above the line (ATL) and Below the line (BTL) will be used
More emphasis will be placed on print (local newspapers and IT magazines) whereas radio will be used to generate greater awareness towards the company and product.
Scheduled patterns will be planned according to the peak purchase season i.e festivals and holidays as the offer can be clubbed with any other hot selling product in the market e.g offer with Samsung Tablet or iphone etc
Marketing Mix
Philip Kotler and Gary Armstrong (2007, p.50) define the marketing mix as "the set of controllable, tactical marketing tools", in order to get the feedback of the certain markets, and regard the 4Ps as marketing mix.
The marketing mix is a business tool used in marketing products. The marketing mix is often crucial when determining a product or brand's unique selling point (the unique quality that differentiates a product from its competitors), and is often synonymous with the 'four Ps': 'price', 'product', 'promotion', and 'place'. However, in recent times, the 'four Ps' have been expanded to the 'seven Ps' with the addition of 'process', 'physical evidence' and 'people'. In simple terms,
Variable
Explanation
4Ps
Product
The project will be available in a wide range of operating features that suits the operational needs of the targeted market. Students and low income group could choose the basic product with limited features. Corporate, Sales personnel and people can opt for a higher end model with all additional features included and which suits their requirements. The product will also be available in an extensive range of colors that could be used by both genders.
The product has the advantage of having all the features from various pico projectors and incorporating into SMART Project and designing it specifically for smartphones and tablets.
Price
The product is available in a vast price range, with a price as low as RM300 for the basic model to RM600 for the higher end model. The price variation has taken into consideration the average income of Malaysians and the targeted segments requirements. The price for SMART Project is currently the cheapest in the market, considering the all in one features embedded into it. This does not compromise the quality of the product.
Promotion
Taking the Budget into consideration the product will be promoted in the following manner
-Chinese New Year season, promotion will commence prior to the season so that people are aware of the benefits and features and set their mind on purchasing the product.
- Enhance online advertising by placing advertisements in all popular websites like Google, Yahoo, YouTube
-Sharing the product with your entire network and asking them to pass it on to theirs (this includes friends, family, colleagues and more). Then, to actually convert those visitors into sales.
-Promoting the promotions through social channels like Facebook, twitter and other relevant groups.
-Mass audience will be made aware of the product through various marketing channels like advertising the product i prime pages of News papers, displaying the product's features on the internet by opening new website, displaying the product at shopping malls at the time of launch, providing discounts for the customers purchasing during Chinese new year, providing extended warranty,
-Exhibitions in colleges
-Personal selling
-Displaying large banners to make people aware
-Tie up retailers on providing discount coupons on the product with every purchase of top selling brands like Samsung, Apple etc.
Place
-Increase purchase interest of the product by placing it in 'high enjoyable' programming.
-Initially deploying entire sales force and advertising the product in Kuala Lumpur as this is the potential market and sales of electronic devices is the most as compared to other cities in Malaysia.
-Placing the product in supermarkets malls.
-Available for purchase at outlets of IT shops
-Tie up with popular brands e.g Samsung, Nokia, Apple etc
-Corporate deals with headquarters of companies, schools, colleges.
-Place product books, magazines, news papers.
-Product placement in retailer outlets and markets like Mydin, Tesco, Lowyat Plaza, Carrefour etc.
-
Service elements
People
-Developing a personal touch with customers by
-interfacing with customers
-setting up road shows in malls
-Providing free demonstration by allowing smartphone and tablet users to link their devices with the SMART Project experience of projection.
-Acknowledge reviews post the exhibition; this is for future development of the product.
Process
- Make online purchase easier by providing links to online ordering systems in their customer's website
- Provide facility to pay for online purchases not only through credit cards but also through Direct Debit or Net Banking from customers' bank accounts.
- Ensure customer service and customer satisfaction is highly valued within the organization and in all the marketing channels like distributors and retail sellers
Physical evidence
-24 x 7 helpline
-Attractive & environmental friendly packaging
-displaying product online and in road shows
-Attractive brochures
-SMART dressing of the Sales team
Sales personnel having full knowledge about product and company
5.0 Economic Evaluation
5.1 Forecast Revenue and Budget
As can be seen from the below table. SMART Berhad requires a capital of RM 3,000,000 to start up the company.
This cost will be utilized for the direct cost and the recurring expenses as tabulated on a monthly basis.
Since SMART Berhad is owned by Maxis, the office will be accommodated into Maxis premises and this will eliminate the rentals.
Out of the expenses the majority of expenses will be towards
62.27% - Direct cost
7.5% - Advertising
19.00% - Salaries
6.00% - Finance
1.20% - License and permits
5.2 Profitability (or Break-even Analysis)
w.r.t the profits, SMART Berhad breaks even in the month of July as the sales increases by the increase in manpower. Profits start generating from the month of August
Tax payment at the end of the year will be 0% as the company nearly breaks even at RM2,972,600 w.r.t the requested budget of RM3,000,000.
SMART Berhad would have recovered the initial budget allocated by the end of the 12th month and expects to start generating profits from there on.
Also by the end of the 1st year SMART Berhad would be a known brand in the local market. Sales force will be increased and the business will then be taken to all major cities in Malaysia.
SMART Berhad's goal for 2014 is to increase its market share by 10% and become one of the top 5 players in the pico projector market.
Goal for 2015 - to increase market share by 20% and to become the most preferred pico projector brand in Malaysia.
On establishing its brand value and customer faith, SMART Berhad will then develop more and more SMART and INTELLIGENT IT products that would solve the common problems most users in the technology would be facing, with the intention of taking the company International and be one of the most preferred brands Internationally.
Thus, the positioning is as follows:
'We think SMART'
References
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Dinesh (2008)Â 800,000 Tablets Sold in Malaysia. Available at: http://mc2.adoimagazine.com/index.php/news/1-breaking-news/8916-tablet-industry-marked-milestone-growth-in-2012 [Viewed: 29 Apr 2013].
En.wikipedia.org (1993)Â Maxis Communications - Wikipedia, the free encyclopedia. Available at: http://en.wikipedia.org/wiki/Maxis_Communications [Viewed: 1 May 2013].
Harvard Business Review (2008)Â The Five Competitive Forces That Shape Strategy - Harvard Business Review. [online] Available at: http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ [Viewed: 1 May 2013].
Harvard Business Review (2008)Â The Five Competitive Forces That Shape Strategy - Harvard Business Review. Available at: http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ [Viewed: 1 May 2013].
Harvardcollegeconsulting.com (2010)Â Past Casework | Harvard College Consulting Group. Available at: http://www.harvardcollegeconsulting.com/cases [Viewed: 2 May 2013].
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Karunakaran, K. (2008)Â Marketing Management. Mumbai: Global Media, p.1,3,39.
Klse.i3investor.com (2010)Â i3investor.com File Server - MAXIS-Cover to Page 83.pdf | i3investor.com. [online] Available at: http://klse.i3investor.com/servlets/staticfile/215238.jsp [Viewed: 19 Apr 2013].
Kotler, P. and Armstrong, G. (2008)Â Principles of Marketing. 12th ed. Upper Saddle River, N.J. Pearson Prentice Hall.
Kuo, L. (2013)Â We're heading for a world with more smartphones than bank accounts. Available at: http://qz.com/66061/were-heading-for-a-world-with-more-smartphones-than-bank-accounts/ [Viewed: 24 Apr 2013].
Mmail.com.my (2013)Â Tablet growth to spike | The Malay Mail. Available at: http://www.mmail.com.my/story/tablet-growth-spike-35704 [Viewed: 2 May 2013].
Projectorcentral.com (2013)Â Top 10 Pico Projectors. Available at: http://www.projectorcentral.com/popular-pico-projectors.htm [Viewed: 21 Apr 2013].
Research, G. (2012)Â Pico Projectors Market to 2016 - Application in Portable 7025812. Available at: http://www.marketresearch.com/GBI-Research-v3759/Pico-Projectors-Application-Portable-Devices-7025812 [Viewed: 6 May 2013].
Timmermansconsulting.nl (2003)Â Other Services - Timmermans Consulting | Heiakkerweg 3 | 5091 KW Middelbeers | The Netherlands | info@timmermansconsulting.nl. Available at: http://timmermansconsulting.nl/en/overige-diensten/ [Viewed: 6 May 2013].
TUAW - The Unofficial Apple Weblog (2012)Â Tablet and smartphone use detailed by age group, gender. Available at: http://www.tuaw.com/2012/10/29/tablet-and-smartphone-use-detailed-by-age-group-gender/ [Viewed: 4 May 2013].
Maxis. (2013) General Announcement. Available at: http://maxis.com.my/personal/about_us/investor/financial/Press%20Release%202.pdf [Viewed: 4 May 2013].
Worldcat.org (2001)Â Preview of Contemporary marketing [WorldCat.org]. Available at: http://www.worldcat.org/title/contemporary-marketing/oclc/320484138/viewport [Viewed: 29 Apr 2013].
List of References
'Asiatradehub' n.d., viewed 30th April 2013
http://www.asiatradehub.com/malaysia/tax1.asp
'International Labor Organization' n.d., viewed 28th April 2013,
http://www.ilo.org/dyn/natlex/docs/WEBTEXT/48055/66265/E55mys01.htm
'Maxis Berhad' June 2012, viewed 27th April 2013,
http://maxis.com.my/personal/about_us/investor/financial/Press%20Release%202.pdf
'Maxis Berhad' 2011, viewed 30th April 2013
http://klse.i3investor.com/servlets/staticfile/215238.jsp
Dr Karunaker, 2008, Marketing Management, viewed 22nd April 2013
http://site.ebrary.com/lib/westminsterintl/doc
'Adiomagazine' n.d., viewed 26th April 2013
http://mc2.adoimagazine.com/index.php/news/1-breaking-news/8916-tablet-industry-marked-milestone-growth-in-2012
'The Malay Mail' Oct 2012., viewed 26th April 2013
http://www.mmail.com.my/story/tablet-growth-spike-35704
'Market Research'June 2012., viewed 30th April 2013
http://www.marketresearch.com/GBI-Research-v3759/Pico-Projectors-Application-Portable-Devices-7025812/
'Havard College Consulting Group' n.d., viewed 20th April 2013
http://www.harvardcollegeconsulting.com/cases
Kurtz, D 2010. Contemporary Marketing Mason, OH: South-Western Cengage Learning
http://www.worldcat.org/title/contemporary-marketing/oclc/320484138/viewport
'Tuaw' October 2012., viewed 2nd May 2013
http://www.tuaw.com/2012/10/29/tablet-and-smartphone-use-detailed-by-age-group-gender/
'Project Central, n.d., viewed 1st May 2013
http://www.projectorcentral.com/popular-pico-projectors.htm
'Quartz' March 2013., viewed 2nd May 2013
http://qz.com/66061/were-heading-for-a-world-with-more-smartphones-than-bank-accounts/
Philip Kotler & Gary Armstrong 2007, Principles of Marketing, Prentice Hall PTR, USA.
'Havard Business Review' January 2008., viewed 1st May 2013
http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/
'IndexMundi' February 2013., viewed 4th May 2013
http://www.indexmundi.com/malaysia/age_structure.html
Neil H.Borden 1984, The Concept of Marketing Mix, Havard Business School
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