Product Marketing Plan for Bloomberg
Using theoretical models/theories and contemporary marketing communications research methods develop a rationale for a new Bloomberg product for the consumer market.
The central idea of marketing is of a matching a company’s capabilities and the wants of customers in order to achieve the objectives of both parties. Therefore, marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services in order to create exchanges that satisfy individual and organisational goals.
When Adam Smith said that consumption is the sole end and purpose of production he was in fact describing what has in recent years become known as the marketing concept. The marketing concept implies that all the activities of an organisation are driven by a desire to satisfy customer needs.
In order to satisfy customer needs it is essential for today’s businesses to create a marketing plan. Marketing planning is concerned with adapting the organisation to a changing environment. Long-term success in current competitive markets requires a co-ordinated approach to meet customer needs better than competitors. All companies have a set of capabilities in the form of resources and management skills, which are not necessarily capable of taking advantage of all market opportunities as effectively.
Marketing planning is a logical sequence and a series of activities leading to the setting of objectives and the formulation of plans for achieving them. The marketing plan operates at two levels. The strategic marketing plan lays out the broad marketing objectives and strategy at the corporate level. It analyses the marketing environment, the competitors, the current marketing situation and opportunities.
The tactical marketing plan outlines specific marketing tactics, including advertising and promotion, merchandising, channels and service. In large companies this is usually done at the strategic business unit (SBU) level.
This essay will formulate a marketing plan for one specific company’s new product for the consumer market. The company, Bloomberg, is a global information services, news and media company. It provides financial information and news via various outlets such as television, Internet, radio, magazines and book publishing. It now wishes to launch a new magazine to the UK market. The magazine would concentrate on providing information about the property market for investors and homebuyers alike. This essay will investigate the process of marketing planning and the management of marketing communications for Bloomberg’s new product.
Strategic planning at corporate level
The marketing process starts at the corporate level. The corporate plan defines the framework for the company’s strategic business units’ operations. Strategic planning at this level involves four activities:
- Defining the corporate mission.
- Establishing strategic business units.
- Assigning resources to each SBU.
- Planning new businesses, downsizing older businesses.
Bloomberg has defined its mission as providing accurate and up-to–date information. It refers to the quality of its products and commitment to customer satisfaction. A large multinational company like Bloomberg would benefit from outlining a shared sense of purpose in order to motivate employees. The company has established SBUs dealing with its different operations, in different countries. Each of the SBUs needs a definition of its business, which specifies the arena in which it will compete. Companies often define their business in terms of the products they produce, but Levitt encouraged companies to define their business in terms of needs. According to Levitt’s theory Bloomberg could define itself as an information supplier catering for customers’ informational needs. The new magazine would be mentioned as a planned new business and appropriate resources would be allocated to the SBU.
Defining the product
After the reception of the corporate or strategic objectives Bloomberg’s strategic business unit can start analysing the market, the competitors’ actions and company resources. However, first it is useful to define the potential product and its contents.
Bloomberg wants to publish a monthly property magazine the content of which would include articles and features on the UK property market, buying and selling houses, investing on property, mortgages, financial data, different kinds of properties and their value and area information.
The marketing audit
Before a company can start planning the new product it should examine the position it holds in the surrounding environment. The marketing audit is the means by which a company can understand how it relates to the environment and it helps the company to position itself in the market it is operating in. Conducting an audit will help it to identify its own strengths and weaknesses in relation to competition. The audit should be carried out at the corporate and the product level. There are two aspects to an audit. The external audit is concerned with uncontrollable variables outside the company such as environmental, market and competitive variables. The internal audit is concerned with controllable variables such as the organisation’s resources as they relate to the environment.
The general evaluation of a company’s strengths and weaknesses and opportunities and threats in the environment is called the SWOT analysis.
Strengths: these are the internal factors that are likely to enhance performance.
Weaknesses: these are the internal factors likely to inhibit performance.
Opportunities: These are the external factors that favour the organisation such as effective distributors, compliance with legislation, presence of growing market segments or competitors being reorganised.
Threats: these are the external factors likely to be to an organisation’s disadvantage, such as competing products.
Internal audit for Bloomberg
- Bloomberg is a multinational conglomerate with the resources to set up a new product.
- It has an established magazine division that can be used to produce and distribute the new product.
- Bloomberg’s other operations such as the website, television channels and radio all operate in the UK and can be used for promotion and advertising.
- Bloomberg is a leading player in the markets it operates, certain competitors have lost market share.
- High-quality products.
- Efficient production.
- Bloomberg’s products have excellent brand awareness.
- The magazine is not necessarily aimed directly at Bloomberg’s usual customer-base.
- It is a different type of magazine than the ones Bloomberg already publishes.
- The magazine will only be published in the UK therefore it may not be profitable.
- It is a specialist magazine targeted to a small market segment therefore it may not be profitable.
- Bloomberg’s magazine division is located in the US, and its other magazines are only sold in the US.
External audit for Bloomberg
- Competitors do not offer similar magazines.
- Competitors have lost market-share.
- here is a need for information on the housing market since the house prices are high in the UK.
- Affluent people are seeking opportunities to invest on property but lack information.
- There is a general interest in buying property in the UK.
- Deregulation in the EU.
- Magazine prices are relatively low.
- People may prefer other services such as television, the Internet and newspapers.
- Free property magazines.
- Newspapers carry property sections.
- The property market is volatile.
Strategy, target segments and objectives:
The marketing audit inevitably produces a great deal of information and gives a good foundation for future strategies. Undoubtedly the most important and difficult of all stages in the marketing planning process is the objective and strategy setting. Goals indicate what a company wants to achieve, strategy is a game plan for getting there. Every company must tailor a strategy to achieve its goals. Michael Porter has condensed strategies into three different types:
Overall cost leadership: The company works hard to achieve the lowest production and distribution costs so that it can price lower than its competitors and win a large market share.
Differentiation: The company concentrates on achieving superior performance in an important customer benefit area valued by a large part of the market.
Focus: The company focuses on one or more narrow market segments. The firm gets to know these segments and pursues either cost leadership or differentiation within the target segment.
For Bloomberg, the focus-strategy is the most effective strategy for the new product. The target market is potentially all the people interested in buying property but the company will benefit more from targeting the segments of the market that are interested in property from the financial point of view. Bloomberg’s usual customers are business people, investors, financial planners and professionals in the finance market. In other words, they are wealthy professionals who might be looking to invest their money on property. By targeting these segments of the market Bloomberg can exploit its other media platforms in its promotional strategy. In the long term focused differentiation would build on Bloomberg’s strong brand image and high-quality portfolio.
Bloomberg uses demographic segmentation for segmenting its market. This means that the market is divided up into groups based on demographic variables such as age, occupation family lifecycle, lifestyle, income etc. Bloomberg’s target market for the new product consists of the following:
Family Life Cycle:
Bachelor stage: Young and single, not living at home. These have few financial burdens and are likely to be concentrating on their career and thinking about buying property.
Newly Married Couples: Probable high combined income, thinking about buying property.
Empty nest: These will probably have savings and their financial situation is good. They may own a house but could be considering moving or buying to rent.
Occupation and Economic situation: Reasonably wealthy professional business people who use Bloomberg’s other services. They are likely to be looking for investment opportunities.
Based on market research and analysis and knowledge of its internal capabilities, the company must decide on its objectives, i.e. the market position it will seek. The objectives must be realistic and specific.
Bloomberg’s initial objective is to launch the magazine in the next year. This will involve setting up distribution systems, production and promotion. The price will be £3.50 and it will be sold in newsagents and book and magazine retailers. The magazine will carry adverts from estate agents. Promotion will involve advertising and direct marketing and will support the positioning strategy. Appropriate marketing communications budget will be allocated. The company will increase research expenditures to improve knowledge of the consumer decision-making process and to evaluate existing and potential competitors.
Marketing effectiveness depends significantly on effective communication. The buyer’s perception of the seller’s market offering is influenced by the amount and type of information they have on the offering and their reaction to that information. Marketing, according to this view relies heavily on information flows between the seller and prospective buyers. Marketing involves decision-making activities, whereas marketing communications is the process of implementation of marketing decisions. Modern marketing calls for more than developing a good product, pricing it attractively and making it accessible. Companies must also communicate with present and potential stakeholders and the general public. According to Kotler every company is inevitably cast into the role of communicator and promoter.
The marketing communications mix consists of five major modes of communication:
Advertising: Any paid form of non-personal presentation and promotion of ideas, goods and services by an identified sponsor.
Sales promotion: a variety of short-term incentives to encourage trial or a purchase of a product or service.
Public relations and publicity: A variety of programs designed to promote or protect a company’s image or its products.
Personal selling: Face-to-face interaction with one or more prospective purchasers for the purpose of making presentations, answering questions, and procuring orders.
Direct marketing: Use of mail, telephone, fax, e-mail or Internet to communicate directly with or solicit a direct response from customers.
The marketing mix as a communication tool
The marketing mix is a set of tools utilised by companies to improve their offer to the customer. It consists of what is known as the four P’s: Product, Place, Price and Promotion. In the past, promotion was viewed as the firm’s communications link with prospective buyers. Today, it is becoming increasingly clear that promotion must be viewed as only one part of a company’s overall effort to communicate with consumers. All marketing mix variables, indeed, all company actions, must be seen as part of the total message the company is attempting to convey to its consumers about its product. Thus, the role of the marketing communications function is to share the meaning of the company’s total product offering with its consumers in the most profitable manner. Every brand contact delivers an impression that can strengthen or weaken a customer’s view of the company. A strong brand like Bloomberg’s is likely to signify quality and reliability, along with technological superiority and speed of service. Components of the product communication include brand name, design, colour, size, shape, trademark and aspects of the physical product itself. Price has also important communications value. Price is often used by sellers to connote quality or value of the product. Bloomberg has priced its magazine quite high in order to communicate its high quality and value for money. Finally, the places where the product is sold have significant communications value. For example, if Bloomberg sells its product in supermarkets its image is that of a low-quality product whereas if it is sold in high street book and magazine retailers it portrays an image of a high–quality product.
Developing effective communications for Bloomberg
The process of developing a promotional campaign starts with identifying a target audience. For Bloomberg the initial target for the marketing campaign for a new product would be the consumers that currently use its other services and products. These have a good image of the company and its products and are aware of its brands. Secondary target would be other people of similar occupations and age, who do not necessarily use Bloomberg products.
Once the target market is identified, the marketing communicator must decide on the desired audience response. The marketer can be seeking a cognitive (to put something into the consumer’s mind), affective (change an attitude) or behavioural (get the consumer to act) response. Ideally a consumer will go through all these stages. First, Bloomberg’s promotional campaign will create awareness of the product, next the consumer will be interested in the product, interest will create conviction and the consumer will buy the product.
Because Bloomberg is introducing a new product it is very important to create awareness. Advertising is often used to introduce new products. This is the promotional tool that Bloomberg is likely to use. Bloomberg is well equipped to create awareness of its new product using its wide communications holdings. Advertisements could run on its television channels, radio and website. The majority of the primary target group in particular use Bloomberg web- services regularly. Other benefits for choosing the Internet as a channel are low costs and flexibility. A company like Bloomberg can take full advantage of promoting its products on every communications channel it owns. For the secondary target group Bloomberg can invest in running advertisements in other magazines and newspapers. The pervasiveness of advertising allows the company to repeat the message many times and Bloomberg can take the opportunity to use advertising to build up a long-term image of the product. Bloomberg will also use direct marketing on the Internet. Primary targets are sent e-mails promoting the product and offering discounts on subscriptions.
Marketing plans are becoming more customer and competition oriented, better reasoned and more realistic than in the past.For Bloomberg, marketing planning is essential to stay ahead of competition. The environment in which the company operates has changed dramatically as a result of major societal forces such as technological advances, globalisation and deregulation.
Marketing planning helps Bloomberg to evaluate its resources against those of others and help target specific markets more effectively. Consumers increasingly expect higher quality and better service. They perceive fewer real product differences and show less brand loyalty. In this example, marketing planning has helped Bloomberg to identify the direction it should take in marketing its new product. Bloomberg has a loyal customer-base, which prefers high quality and reliability as we discovered whilst segmenting target markets.
Therefore, Bloomberg can at least partially aim its offering to its existing customers. Bloomberg also discovered that a potential weakness in the product is the fact that it is not directly and exclusively aimed at the company’s current customers. Consumers today can obtain extensive product information from the Internet and other sources, permitting to them to shop more intelligently. Bloomberg has taken advantage of this fact by basing a significant part of its marketing communications on the Internet.
A definite advantage for Bloomberg is its ability to exploit its media platforms in its promotional efforts. The advertising campaign on Bloomberg TV, radio and Internet will undoubtedly reach its primary target audience. However, if the purpose is to attract new customers from outside Bloomberg’s existing communication channels this marketing communications approach has serious weaknesses.
There are potential buyers for the magazine that cannot be reached by only advertising in magazines and newspapers. Expensive price might prevent some people from buying the magazine and the exclusive feel that Bloomberg has created for the product might also prevent people in developing an interest in buying it.
A large company can also exploit synergies between its SBUs. Marketing and sales synergies are particularly important. Exploiting the interrelationships between the company’s businesses can create a definitive competitive advantage. Two SBUs acting together will be superior to the same SBUs acting independently. Bloomberg has exploited synergies and therefore has advantage over smaller competitors. This can make costs smaller and contribute to profit growth.
Marketing planning and analysis helps Bloomberg develop new products for existing markets but will also help it identify new openings for new products in new markets. However, the most important reason for marketing planning is to force managers to ask the right questions. Outcomes will rarely turn out as planned.
According to Doyle the real value of planning is not to forecast events but to encourage managers to explore carefully the real determinants of future success in competitive markets and to assess business risks. The significance of planning is that it is the only route available to a company, which will clearly increase the odds of success. Marketing planning combined with clever marketing communications is the essence of survival in today’s competitive markets.