The Marketing Communications of Dyson Limited
Dyson Appliances Limited is a UK based company which is a market leader in selling vacuum cleaners in UK, US, Australia, Japan and rest of Europe. It started marketing its vacuum cleaners in 1993 in UK. It has been branded the No.18 consumer superbrand for the year 2010 in UK. Dyson is not known as a manufacturer of electronic products but has been acquainted to the public as a technological innovative company. Innovation and invention is the heart of Dyson Ltd. It
This private limited company was founded by James Dyson an industrial designer. To make the most effectively and world wide selling brand of vacuum cleaners is the mission statement of Dyson Ltd, with time Dyson has evolved into other products in the same home appliances category as the Washing machine, Bladeless fan and hand dryers. Being a private company all the details about the company are not available to the public, but the best of information has tried to be extracted from the available research papers, newspapers and websites.
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James Dyson attended London's Byam Shaw art school and was specialising in painting. But painting beautiful objects wasn't enough to quell curiosity, he wanted to make, and then he joined the Royal College of Art, where James studied architecture, but instead of colonnades and cladding, robust marine engineering was the order of the day. He developed a flat-hulled high-speed landing craft and, with it, his passion for engineering. Pretty soon, he'd also developed a new kind of wheelbarrow - one with a big fat ball that didn't sink into mud and chunky feet for stability. All the while learning to take risks, make mistakes and use frustration as a fuel for creativity and solving problems.
Dyson vacuums are exhibited in museums around the world, including the New York Museum
of Modern Art, the San Francisco Museum of Modern Art, the Science Museum in London,
Paris's Centre Georges Pompidou, and the Danish Design Centre in Copenhagen.
New ideas are the lifeblood of Dyson. Making Mistakes, failure and home trials are guiding principles of Dyson which invests around 50% of its incomes for further development.
Dyson Key Markets and Areas of operation
Being started commercial operations in the year 1993 in UK. Dyson has now consolidated its position as the market leader in the vacuum cleaner section in UK. It has presence across all over the world. Based on the available information Dyson sold its products in more than 40 countries.
What is Marketing Communication
The word Marketing Communication is made of 2 words which can be interpreted in their individual capacity. Hence, the meaning of Marketing Communication is varied due to changing interpretation of the base words.
Marketing may be defined as the process by which organizations create interest of customers in products or services they produce. "Marketing" implies selling and a goal of effective benefit for the communicator. (Marketing Communication and the Hierarchy of Effects- Michael L. Ray)
In the global context, global marketing can be defined as the firm's commitment to coordinate its marketing activities across national boundaries in order to find and satisfy global customer needs better than the competition. This implies that the firm is able to:
Develop a global marketing strategy based on similarities and differences between markets;
Exploit the knowledge of the headquarters through worldwide diffusion (learning) and adaptations;
Transfer knowledge and best practices from any of its markets and use them in other international markets.
(From Global Marketing- Svend Hollensen)
"Communication is a process of interaction of messages among persons through a communication channel or a medium. Communication is the exchange and flow of information and ideas from one person to another; it involves a sender transmitting an idea, information, or feeling to a receiver" (U.S. Army, 1983).
Effective communication occurs only if the receiver understands the exact information or idea that the sender intended to transmit.
In the context of marketing, communication is the message communicated by the organization for its intended or prospective customer, to ignite the buying process by such a customer. Effective Marketing Communication is one which would effect the sale of a product or a service.
Marketing Communication (Marcom) is a subfield of marketing which involves personal selling, advertising, publicity, public relations, reseller support- merchandising, product sampling and packaging. These are all communication tools and the subfield is really an attempt to bring together several diverse part of the marketing mix under one conceptual framework based on communication research and theory.
"Marketing Communications is a critical aspect of a company's overall marketing mission and a major determination of its success. The marketing communications components of the marketing mix have increased in the importance dramatically during the past decade. Indeed, it has been claimed that marketing in the 1990s is the communication and communication is marketing. The two are inseparable" Shimp (2000)
"Marcom cannot be just used for marketing alone but Marcom techniques can be used for a variety of other purposes such as for a political campaign, improvement in health practices, changes in societal beliefs etc. Thus marcom applies for persuasive mass media campaigns of all types." (Marketing Communication and the Hierarchy of Effects- Michael L. Ray)
Role of marketing Communications
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Marketing communications (marcom) represents all the consumer oriented materials such as leaflets, press releases, Web sites, and trade show presentations. The importance generated of marcom planning is due to the direct relation of such planning to the customer, which makes marcom planning an important activity for the company. Thoughtfully written marcom plans:
Enables the company to handle a large number of products, areas and consumer interactions in one single tone.
Creation of integrated communication channels by a varied team of people.
Assist the messages to grow above the sphere of the marketplace and continuously reach the target audiences.
Provides superior results in terms of efforts of time and money.
Tools of Marketing Communication
For any organisation, the tools of marketing communications includes distributing information, promoting brand, image and reputation, creating and stabilizing product and service demand, emphasizing features and benefits, providing competitive differentiation, generating sales leads, ensuring customer retention and loyalty, and motivating staff.
Some tools are as follows:
Advertising is defined as "any form of communication made by a public or a private undertaking in connection with trade, industrial activity, business, craft or profession in order to promote, directly or indirectly: a) the commercialisation of any goods or services, b) any ideas or principles, initiatives or institutions". Advertising is an impersonal, mass medium form of communication, in which the person who wants to communicate the message incurs a monetary cost for transmitting the message through a selected medium. It reaches a large number of audiences in a discrete way. There are two main functions of advertising:
Influencing the demand for commodities and
Managing awareness and understanding of the entity in an entirety.
The various types of media which could be used for advertising are:
Print media advertising like in the newspapers, periodicals, directories etc.
Broadcast media advertising in the form of television and radio for mass penetration at a relatively lower cost per person reached.
Outdoor advertising like the billboards on roads, bus-stops etc.
Enclosed advertising like a store displaying its name inside the store.
Digital and other media like telephony advertising, cinema advertising, online and internet marketing.
Sales promotion is offering to the consumers extra or additional value. Such an additional value may be created by offering say Buy One get One products, or Half Price products, free products/ samples, extra quantity of the same goods at no extra price, discounts and price reductions. Hence the main objective of sales promotion is to encourage certain behaviour of audience, often to effect sales for the organization. Such a tool attracts new customers and help retain existing base.
"Direct marketing is the total of activities by which products and services are offered to market segments in one or more media for informational purposes or to solicit a direct response from a present or prospective customer or contributor by mail, telephone or personal visit." (Onkvisit and Shaw 1993, p717). Direct marketing is concerned with the management of customer behaviour and is used to complement the strengths and weaknesses of the other communications disciplines used to communicate directly with individual customers and often carry a behavioural (call to action) message. " Fill, C. (2009), Marketing Communications Interactivity, Communities and content.
Thus we can understand by direct marketing as all the activities undertaken by seller which help to communicate directly with the buyers for the purpose of effecting an action by the buyer
"PR or publicity is the marketing communications function or activity undertaken by the organisations which carries out programmes designed to earn public understanding an acceptance." (Svend Hollensen Global Marketing, Pg: 554). Being a component of society an entity has to protect the interest of itself as well as its stakeholders (society in general )and therefore has to have effective marcom for good public relations. It involves both internal as well as external communication
Unlike Advertising, personal selling is a dual way or more than 2 persons involved communication process which enables instant feedback and is not disturbed much by the noise like in advertising. It is an intense communication process and requires skills for effective communication, but it also enjoys high flexibility.
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Market segmentation is the division of a market into different groups of customers with distinctly similar needs and product/service requirements.
To determine which, if any, of the segments uncovered in the market segmentation should be targeted. Such segments are to be specifically targeted by the organization.
The act of designing the company's offering and image so that they occupy a meaningful and distinct competitive position in the target customers' minds.
Integrated Marketing Communication
The concept of IMC took birth in the US in the late 1980's. The Caywood, Schultz and Wang presented in 1991 the concept of IMC after a survey was conducted by Northwestern university with national goods advertisers in USA.
Schultz defined IMC as, "Broadly defined, IMC is a concept of marketing communication planning that recognizes the added value of using a comprehensive plan to evaluate the strategic roles of a variety of communication disciplines. It combines these disciplines to provide clarity, consistency and maximum communication impact. "(Schultz et al, 1993). "Proponents of IMC contend that it represents a logical first step in the transition from outbound product driven communication to the more interactive consumer and behaviour oriented approaches of the twenty first century. "(Kitchen and Schultz, 1999). Thus we can understand from IMC that it is a process by which all forms of marketing communication are managed in such a way that the prospective customer or public are delivered a plain, constant and convincing message about the entity and its products.
(An inside-out approach to integrated marketing communication-An international analysis by Gayle Kerr, Don Schultz, Charles Patti, Ilchul Kim)
Among the differing definitions of IMC, Shimp has tried to find the unique features of IMC in 2000 as follows:
The primary objective of IMC is to affect behaviour through directed communication.
IMC process starts with the buyer or prospect and ends with the brand communicator.
IMC uses all types of communication and all means and company contacts as message release channels
For a stronger brand image synergy and coordination are utmost important.
IMC entails marketing communication build lasting relationship between the brand and the buyer.
Thus we can conclude that IMC is the planning, coordinating, controlling, integrating and managing the various communications which evolve from an organization towards its outside environment or external environment.
Marketing Communications Strategies and Tactics employed by Dyson
To understand the marketing communication strategy of Dyson, it is very important to know a brief history of the company which will help us understand the future course of marketing for the company.
James Dyson had started working on his vacuum cleaner idea since 1978. His idea was to build a bagless, filterless vacuum cleaner. In the 1980's he approached Hoover Company which was the market leader of that time to take up his idea, but it was not accepted by Hoover. Undeterred by the Hoover snub, Dyson continued to work on his concept of vacuum cleaner. After 15 years of hard work, determination, toil and frustration and testing 5000 prototypes James finally launched the Dyson Cyclone DC01 Vacuum cleaner which was based on the effect of a tornado in 1993. The company for the next 12 years put almost 100 % of its profits for further R&D expanding its team of scientists from a meagre 3 scientists to 350 scientists. In interview with a leading advertsing magazine, Dyson's global marketing director, Clare Mullin, stressed the company's pledge to development, saying, "We're an engineering-led company, not a marketing-led company."
Thus the overall stress of the company can be found out to be technology, development, innovation and invention. This is a marked difference between a profit oriented commercial company and Duson. Dyson is an innovative, technology company not just any other company. This is the basis of marketing communication of Dyson that it is different.
Technologically superior product offering
Loyal Customer base
Financial Strength and higher profitability
High Revenue generation
Can earn premium on its product offerings
Lower sales quantity than competitors
Limited number of item offering in portfolio compared to larger competitors
Qualitywise superior offering is always in demand everywhere.
New untapped markets.
Increasing sales by reducing prices.
Susceptible to cyclical changes as in recessionary conditions cheaper substitutes may be preferred.
Branding as expensive products.
Better product offerings by competitors at relatively lower prices.
Strategic Mission and Objectives
To build the most effective and efficient vacuum cleaners brand.
Be a world leader in the vacuum cleaners brand
To build world class cutting age electronic appliances for improving peoples lives
To be technologically innovative
To invest heavily in development for future sustenance of business
To maintain the market leader position in the vacuum cleaner segment
To maintain the market leader position in the vacuum cleaner segment
To be a market leader in the vacuum cleaning and home appliances business. To market company as a technologically advanced company producing high quality products for improving daily lives.
To maintain and consolidate the market leader position in the vacuum cleaner segment (2002)
To rapidly enter into the market and capture the vacuum cleaning markets(2002)
To increase sales by a certain percentage say 5%
To increase sales by say 10%
Marketing Communications Objectives
Communications Impact- the objective of any marketing communication is too effectuate sales and promote the brand image of the organization.
Credibility- It is the value attached by the customers
Cost- These are the costs attached to the marketing communications.
Control- The level of control which can be exercised on the marketing communication through different tools.
The use of different tools entail acahievement of different objactives as may be predecided by the organization.
Marketing Communication Message Objectives
Differentiate- Dyson has tried to differentiate its products by stressing the superior technology of the product. Don't Lose the Suction Campaign very well pronounces the differentiation of Dyson products from its competitors product.
Remind- This messages involve repeating the messages earlier delivered. This consolidates and Strengthens previous communication. Dyson states that his messages are boring, but still it shows the company's seriousness towards its business.
Inform- This involves informing and educating the qualities of the product. Dyson's product in US and UK do the same function of informing qualities to the customers.
Persuade- This induces the customers to take action towards buying the product.
In short, the marketing communication message objective should be to attract, maintain and inform consumers about the brand.
Marketing Communication Strategies (3 P's)
The adoption of the strategy is based on the Product Life cycle and the particular marketing objectives:
Push strategy and
UK and Europe Markets
Dyson believed in its products to be the advertising tools. For a technology enhanced quality product the word of mouth is the best form of advertising or marketing communication. In Europe Dyson enjoyed a huge word of mouth advertising, hence the need for specific high budgets or cost allocation to marketing communication was less. One more way of communication was through recommendation of store staffs.
After tasting success on the European Continent, Dyson embarked on new voyages to the Unites States. The entry of the high priced, British made vacuum cleaner in US coincided with the recession and dwindling US Vacuum industry in 2002. But the creator of vacuum cleaner James Dyson also presiding Dyson Ltd was upbeat about the success of vacuum cleaner in US markets. Such an upbeat mood was due to the knowledge of placing a high technology product in the hands of customers creating value for the product.
The tools of mouth to mouth marketing communication was not feasible in US as people were not so close and distances separated people.
DOESN'T LOSE SUCTION CAMPAIGN
Fallon Worldwide, an ad agency won the advertising contact from Dyson and launched a campaign in USA in 2002 by the name "Doesn't Lose Suction" to showcase the superior technology of Dyson products in the vacuum cleaning business segment which needed an improvement and a change as per Dyson.
For the selection of an organization, we have selected Apple Inc. as our organization. The company is to launch a Summer campaign for the launch of its Iphone-5 in the UK Markets. Launch date is on June 1 2011
Apple Inc. Objectives
Based on the organizational motto of "Think Differently", Apple Inc has its stated objectives of focusing on satisfying personal consumer demands rather than merely fulfilling a demographic requirement as well as, improving performance and stability rather than introducing new features when releasing new versions of any product.
The Apple Iphone brand mission is to bring best mobile experience to everyone.
The Iphone brand vision is to empower everyone with the latest cutting age mobile technology.
Producing a phone which caters to all the basic requirements of a mobile.
Build strong brand orientation.
To cater to the niche segment of the market.
Introducing latest and innovative technology in mobile phone experience.
To present an internet - facilitating smartphone along with the Ipod and improved version of Iphone 3 and Iphone 4
Improved network connectivity than Iphone 4
Camera for photography and video needs for special moments, 8 MP Camera including a camera for video calls.
Sleek and stylish features
64/128 GB Memory for extra storage needs
One Touch email technology
Upcoming 4G Networking technology.
Inbuilt Apple GPS Navigation system.
One push connectivity
Highest resolution screen in the phone market.
Touch screen with scratch proof technology
Higher price helps maintaining it as a mobile for niche people, hence demand is maintained.
It is the most handy phone available in the market.
Thousands of software applications are available specifically made for Apple on Istores.
Upgradability is possible due to software upgradation.
Brand Knowledge makes Apple products sell as hotcakes.
It has best touch screen resolution in the market.
Most suitable for entertainment purposes attracting young people towards Iphone.
High price deters some customers
Not much suitable for business purposes.
Relatively smaller segment of smartphone has scope for development.
Branding as an innovator and revolutionizing products.
IStore provides a continous stream of revenue even after sale of Iphones.
Perceived luxury value to Iphone has result of increasing demand.
Opportunities to tie up with many companies for creating Iphone applications.
Competitors coming up with better quality and better features for phone
Apparent pressure for reducing prices.
Target Customer profile
This involves identifying the similar groups of customers. For Iphone similar groups of customers maybe male/ female, amateurs/ professionals/ corporate persons, students etc.
Iphone target market is the group of people who want smart phones as well as entertainment devices. The target may include cream class of people, who like to boost features. For business needs professionals, corporate personnel are to be targeted. The primary target would be the upper middle income persons. They would be targeted as the phone is build based on their requirements. The secondary target could be the university students, high school and college students who need a all-in one device. Corporate customers for large orders are also to be targeted.
The Iphone 5 is to be positioned as a revolutionary product, differentiating from all the available phones in the market. It is to be marketed as an Apple brand, a symbol of quality. To be promoted as a computer which is a phone.
A high target has been set up for the first 2 years of launch in UK and USA:
In the first year, 2 lacs of Iphone to be sold in UK based on our past performance of Iphone sales.
In the 2nd year, an increase of 20% in the sales target over 1st year is contemplated.
The Iphone has the great features as described above.
The Iphone is competitively priced at £450 in the UK markets. But in agreement with network providers like Vodafone, T- mobile, 3, Orange, O2 etc, competitive and best deals would be provided for the customers.
As the target groups are found out, targeting the target group with the latest promotional media. Large scale TV advertisments. Regular advertisements for full 2 years period. Creative advertisement. Creation of hype around the phone.
Large scale distribution of phones before the day of launch based on the past experinces of rush on the launch day and shortages within hours of launch.
Message and Creative idea
" If you are not using Iphone5, you are missing out on something!!!". "Have you tried your hand at the new Iphone??".
"Iphone5, This changes everything again!!!"
Based on the targeted sales of 2 lacs Iphone5 , the revenues turn out to be (£450 * 200000) = £90,000,000. We would work out the initial marketing communication expense at say 20% of revenues, then we have a total of £18,000,000 for our marketing.
Reference and Bibliography
Svend Hollensen: Global Marketing- A decision oriented Approach, Fourth edition, Pearson- Prentice Hall
http://www.iphoners.com/threads/iphone-marketing-plan.141/ (Accessed on 17-1-2011)
http://www.howtobeamarketer.com/articles/marketing-mix/4-promotion-marketing-communications/46-integrated-marketing-communications-templates-word-powerpoint-and-pdf (Accessed on 17-1-2011) Used for IMC Plan Diagram
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