The Marketing Planning Process
The Real Market Situation
Objectives of the Marketing Plan
Evaluation the Performance of the Marketing Plan Conclusion
A marketing plan is a strategy used by a firm to ensure that it meets its market objectives; this may be part of the business plan or may be prepared to introduce a new product in to the market. It needs to be clearly defined without any ambiguity in order to meet its objectives. In our case the product is a medicament which is to be introduced to a new market in Australia by an international company which has international reputation. The plan shall be in the short run due to the continuing changes in the growing market of pharmaceuticals.
The plan consists of the macro and micro environment analysis, SWOT analysis, market research and means of evaluating the performance of the market plan of the pharmaceutical product. The plan needs to be evaluated severally to see if its meeting its objectives.
THE MARKETING PLANING PROCESS
The plan need to have an objective, this objective should be drawn from the firm mission and vision. In our case since the product is a medicament being introduced into a foreign market, that in the
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THE REAL MARKET SITUATION
The targeted customers of the medicament are the adults who are likely and continuously suffer indigestion heartburns and trap wind, this is because it works fast, does not require drug prescription. The firm also targets the people who suffer economy related stress, this is because the economy of Australia is growing and people are suffering a lot of stress. The firm should also target other groups in the market, like the school children and the younger ones; this will boost its sale and command a bigger market share.
The business environment for the Australian market is conducive for the pharmaceutical company; there the economic growth and the political stability which is offering a conducive environment for the foreign investments. There is reasonable technological development and the emergent of the free market which makes the entrant of the new products in to the market though there are some disadvantages associated with this. The pharmaceutical industry is also growing in Australia.
The strengths of the medicaments are that; there company has highly qualified personnel which make the probability of succeeding very high. The firm is also internationally recognized, this will boost the confidence of its users further more the firm has experience of entering different markets of different countries therefore increasing the chances of successful entry possible. The company has a very careful approach of entering new markets coupled with flexible policies meaning the company can adjust to the needs and specifications of the locals market. The above combination makes the future of the firm look blight in the new market.
The major weakness of the firm is that the product is new in the market and has not been introduced before in Australia therefore it’s expected to face stiff competition from the international firms which control the prescription of the drugs and the local firms which already are the early entrants of the market.
The major opportunity of the firm is that the firm has international reputation and the pharmaceutical industry in Australia is rapidly growing due to the demographic and economic growth. There are high chances of successful entry in the market since in the Australia market, the international pharmaceutical companies control the prescription of the of drugs while the local market is characterized by free forces of the market controlling setting the equilibrium prices, this means that there are no barriers of entry. The company can sell its drugs over the counter because the drugs are safe and accessible to the customers easily. There are also many targeted customers, that’s the adults population, this is because they are expected to continue suffering stress related sickness due to the change of their eating habits from the traditional foods to the fast foods together with the fact that the growth of the economy is causing stress too.
Another major opportunity of the company is its capability to make the drug available to all the customers in the five governorates in Australia. The firm should build a network to sell the drug through out the country even if it will involve the local companies involved is selling similar products. It should also cooperate with the supermarkets which are located even in the remote to enhance the introduction of the drug in the market, the firm can also cooperate with the pharmacies or even acquire or merge with the local companies in the pharmaceutical industry who have a well established network in the market.
The social-economic and political stability of Australia offers an encouraging environment of the firm introducing the product in the market. The company can also promote its products to create consumer awareness by use of the internet, television and press.
The main threat of the firm in the market is the price competition from the firms existing in the market; those include the local firms and the international pharmaceutical companies. There is also the probability of the existing firms producing similar product due to the high technological advancement especially the international companies.
OBJECTIVES OF THE MARKETING PLAN
The financial objectives must be turned into marketing objectives, the objectives might be:
1. Achieve a certain set sales volume
2. Expand the customer awareness about the pharmaceutical products
3. Expand the number of outlets the pharmaceutical company has
4. Aim at achieving a certain average price
5. To fully recover all the costs
The objective of the pharmaceutical company can be one of the above.
The pharmaceutical company in question is feeling at a disadvantage because it’s a late entrant in the market because though there is free market, there are already international companies and local companies in the market, but in real situation, the early entrants also called the early mover can be overcame by those who enter the market late if the pharmaceutical company is marked by the following features.
I. The market has similar products (homogeneous product) that are not highly differentiated therefore there are no products superior to the other.
II. The customers may not be satisfied with the existing products and this can lead the introduction of the new drug to be favored by the real market situation whereby this will be an opportunity to exploit
The late pharmaceutical company should first accept the fact that it’s a late entrant and should face the challenge since with time it shall become a player in the market since the market is still growing fast since the firm is new in the Australian market; here are several strategies it can take to gain some market advantage.
Sales promotion, public relations and advertising
Advertising is any paid form of non personal presentation and promotion of ideas, goods or services by an identified sponsor. In advertising the pharmaceutical product, the main objective should be informative advertising because it figures out mainly in the pioneering stage of the product. It should embrace five Ms of advertising; these are mission, money, media, message and measurement. T should focus on the target audience, product and be cost effectiveness.
Sales promotion consists of diverse collection of incentive tools, mostly short term, designed to stimulate quicker or greater purchase of the drug and it’s a key ingredient of the marketing campaign. It’s used because it yields faster and easily measurable than advertising. The pharmaceutical drug can apply a number of the promotional tools which include the coupons, samples, price packs, premiums and patronage awards.
Public is any group that has actual or potential interest in or impact on a company’s ability to achieve its objectives. Public relation involves a variety of programs designed to promote a company image or its individual product. The pharmaceutical company should adopt a public relations strategy to build awareness, build credibility and to stimulate the sales force and dealers.
The firm should offer its products at a lower price than that of its competitors in the pharmaceutical industry in the short run. If the existing companies don’t have a strong customer loyalty, then they will shift to the product being offered at a lower price since the product is of high quality and it acts fast with no side effects. If a company tactics is to battle on price they should support its self for reaction by competitors, since they will not be happy to see sales shifting to new firm who are further more trying to enter the market and arte therefore likely to introduce incentive to compete more effectively.
Add value to the product
Price battling is risky and the firm should adopt better strategies to be applied even in the long run, by offering benefits beyond the basic product. The pharmaceutical company can introduce additional features that will add additional value such as attractive packaging with extended warranty plans or promote features that already exist but are not well exploited for example promoting new product’s compatibility with other products sold by the company. The company can as well direct attention to advantages in the manufacturing process like locally produced, state of art manufacturing process or dedicate workforce.
The pharmaceutical company should adopt other incentives not applied by the competitors to gain the confidence of the new buyers in the market because the price competition is likely to be in the short run and the competitors are likely. The firm should adopt financial incentives that are not directly linked to reducing prices but rather are likely to gain a market share this may be like offering free products additional to the products bought.
Other incentives include building clinics and money back guarantees to the customers who have complain against the new drug. Other incentive can include offering customer service to the adult customers who need special assistance, it can also include offering free check ups to the customer and this is likely to have some positive image in terms of public relations of the company.
Offer stiff competition to outdo the competitors
Instead of investing money in trying offer price competition or other incentives, the company can decide to dwell more on the opportunities and strengths while fighting hard to overcome the threats and the weaknesses so that the firm can win more customers in the market, The company should invest in the opportunities not exploited by the competitors so that it can gain a big market share
Other ways to market the product
The firm needs to define ways of managing the product in terms of relocating it, changing with the customer needs, more on packaging and design, and blending it to increase more benefits to increase consumer satisfaction. It has also to monitor its market distribution channel and where to offer the customer service where it’s necessary.
Pricing strategy should also be developed; this includes price discrimination to different consumers with different levels of disposable income. This may involve segmenting the market and to develop competitive market entry prices since there already firms which have first mover advantage. The promotion strategies need to be laid out, this includes strategies such as developing a strong sales force, offering free samples, selling at discounted prices and developing good public relations.
EVALUATION THE PERFORMANCE OF THE MARKETING PLAN
The pharmaceutical company can evaluate the performance of the marketing plan by looking at the sales volume or by the number of customers they have won within a certain period, may be one month or a year.
It can also be calculated by use of the variance of sales from the targeted sales. If the targets are not met, then the control measures are taken to ensure that the targets are met, first the root of the problem is identified then a plan a course of action is taken to sort out the problem.
Market share analysis
The pharmaceutical company should evaluate the market share of the drug, this is because the sales volume may be growing but the market share is decreasing, but since it’s a new product entering the market, the firm can evaluate its market share from time to time to know if it’s growing. In trying to tack the market share, there are a number of features in the market to be evaluated, these are:
Total market share
Segment share – that in the specific, targeted segment
Relative share -in relation to the market leaders
This involves calculations of the marketing expenditure in relation to the sales volume. The expenditure could be broken into the promotional expenses and the administrative expenses and so on.
For the profit making firms, the financial analysis should be calculated to know if the marketing plan is meeting its target in terms of the sales, the financial analysis also check of the market plan is working within its set budget. There are a number of analyses which need to be calculated, these are:
a) Is the contribution margin less or greater than the net profit
b) Is the gross margin greater or less than the return on the investment?
c) Is the net contribution less or greater than profit on the sales
The pharmaceutical company can also compare the achieved results with those of other firms in the market.
The above measures of performance of the marketing plan concentrate on the short run features of the plan, but there are a number of indirect measures, essentially tracking customer attitudes, which can also indicate the organization’s performance in terms of its longer-term marketing strengths and may accordingly be even more important indicators. Some useful measures are:
I. Market research – including customer panels (which are used to track changes over time)
II. Lost business – the orders which were lost because, for example, the stock was not available or the product did not meet the customer’s exact requirements
III. Customer complaints – how many customers complain about the products or services, or the organization itself, and about what?
A marketing plan needs to be evaluated more frequently so that it emphasizes more of what works and less of what it doesn’t work. The implementation team should be more result oriented than the work done. The marketing plan should be carried out with its sole objective to meet the firms goals within the given budget allocation.
Carol Ann Waugh (1999), web article, Outline of a Basic Marketing Plan. Available at:
Philip Kotler (2002) Marketing Management: the Millennium Edition, Asoke K Ghosh, India