The Consumer Market Segment And Target Market Marketing Essay

This marketing report aims to develop a new product in Hong Kong. In this report, I will encourage Polaroid Corporation to develop an instant camera with instant film calls Video Photo Instant Series (VP1 Series), a camera which can take five to ten seconds video and show it into the film instantly. The reason of choosing the Polaroid Corporation (Polaroid) to develop this product because Polaroid is one of the leading instant imaging companies in the world. Ideally, to combine the video and the film is for the user which can completely catch up the moment and share to others immediately. Besides, by using this instant camera can make the Polaroid style (the image might be yellowish, greenish or black angular case) in the video, and let the film becomes an art work, thus enhance the culture level of art to the citizen. VP1 Series which is a new generation product could help Polaroid to stand out from its main competitor, Fujifilm.

In the report, I will first identify the market segment and target customer for the new product. Then I will rationally define the potential for produce the new product by analysis the company environment and the market environment, and make a conclusion to show the strengths, weaknesses, opportunities, and threats (SWOT) of the new product. After that, I will describe the new product design in detail and lastly, implement the Marketing Mix Strategies to achieve the goal successfully.

Introduction

In the 90’s before in Hong Kong, people regard Polaroid as one of the most trusted, well‐respected and recognized brands when it comes to instant photography. As the Polaroid SX-70 appeared in the 70’s movie “Love Letter”, Polaroid becomes a famous icon in the trend. Besides, some company would tailor made the limited edition Polaroid to their customers or business partners, which seems as status identification.

However, because of the technology had rapidly advanced. Digital camera had replaced the status of instant camera. Customers thought that digital camera is inexpensive as they can retake the photo unlimited times, the photo can easy to store whether in the computer or memory stick. In addition, computer software such as photoshop, photoimpact, etc. can help for corrects the photo to become perfect. Integrated with video function is also a gimmick for sell, and the selling price is declined rapidly as new model appeared quickly. There is no doubt that digital camera had becomes popular as people are easy to afford to buy one, and that also bring out the great mass fervor for photo taking.

After a past few years, people aware that the photo is too perfect but lost the truth, they are willing to back to the “honest world”, they think that the un-perfect can reality to reflect the “truth” in the moment. Besides, people treat a photo not only for record the moment, but also a art work, and a famous Japanese photographer, Yasumasa Yonehara, had utilize the instant camera to take the photo and printout the photo on the T-shirt, which is popular for the teenagers to buy. As a reason above, the trend of camera type had back from the camera which is using film, thus instant camera, and it is potential to penetrate the instant camera to bring a new concept and experience to the customers.

Developing the new product

The principle concept of the VP1 instant camera is based on the model of exiting product, with improve the technology to record the video and show it on the VP1 instant film, which maintain its core benefit, user can instant to share the moment. It is potentially for all gender and age group, especially the teenagers and the artist. There is not much competition with the existing instant camera as they didn’t have the video record function. Although the function of VP1 Series is similar with the digital camera, but digital one cannot create the special texture and the unique style of Polaroid in the video. Therefore, VP1 Series is a unique product in the market, and it is an opportunity for Polaroid to be a first-mover to take the advantage in the market.

The Consumer Market Segment and Target Market

Consumer Market segment

The aim in segmentation strategies is to target a group of customers who share a similar set of needs and wants. For the VP1 Series in Hong Kong market, segment marketing is identified (Kotler, P. & Keller, K. L., 2009).

Demographic Segment

The market of VP1 Series will divided for man users and women users, the age group will define as 18 to 30, 30 to 45, and 46 to 60. And the income level will define as lower than $5000, $5001 to $15000, $15001 to $30000, and more than $30000 per month.

Behavioral Segment

Customers will be divided by their occasions in the VP1 Series market. One is retail customers who are the small size electronic retailer shops which buy for selling to others and one is the end-user customers.

Target Market

Polaroid should use the undifferentiated marketing strategy. It is because VP1 Series is potentially for all gender and age group, and the benefit for the customers is majority for fun, therefore, undifferentiated marketing strategy can target the whole market with one offer (Kotler, P. & 2001).

Environment Challenges – Internal and External

Internal Environment Analysis

To analysis the organization environment of Polaroid, its brand name, products, and competitors will be focused on.

Brand name

The Polaroid brand has been around for more than 70 years starting with polarized sunglasses, which then evolved into instant film, cameras and camera accessories and became a symbolizes of instant camera. It seems a bit old fashioned, but it’s a brand like Coca-Cola and the sheer cool-factor will hopefully keep Polaroid around for a long time (Polaroid, 2010).

Products

Polaroid’s primary products are instant film and cameras, digital cameras, digital peripherals, secure identification systems, software and system solutions. Polaroid also operates certain non-core businesses such as graphics, sunglasses, and polarizer and holography. In Hong Kong market, Polaroid is focus on its core products, instant camera and film, both of them are at the decline status in product life cycle. As the digital camera appeared, the instant camera had been covered, Polaroid instant camera became unpopular and therefore in 2006, Polaroid stop produce the instant camera. In 2008, the instant film had also stop produce as the effect of poor selling performance (Polaroid, 2010).

As the market trend of camera is turned to digital cameras, Polaroid had put the source to invest a digital camera with their core benefit for the consumers, instant. And therefore, model Polaroid Two, a instant digital camera was born.

Competitors

There is only one direct competitor for Polaroid in the Hong Kong market, which is Fujifilm. The core products of Fujifilm are color films and digital cameras. As the Polaroid style photo is popular in Hong Kong and it can only made by the instant film, Fujifilm had produced the instant camera and film, which is their first step to join in the instant camera market in Hong Kong (Fujifilm Hong Kong, 2010).

The indirect competitors should be Holga and Lecia. They are the film camera which can also make a special effect, LOMO style, in the photo. Although they are not the instant camera, they can also give the special experience to their user.

However, there have several potential competitors which are Canon, Nikon and Lumix. Although these brands did not produce the instant camera, they are both have many experience and technology in produce the camera and they are both “playing” in Hong Kong camera market long time ago, thus create a brand loyalty to the customers. Therefore, if Polaroid produces the VP1 Series, these brands can easy to imitate the unique function of VP1 Series and against Polaroid in the market.

External Environment Analysis

To analysis the external environment of Polaroid, thus the market environment, PEST is utilized.

Political Environment

Hong Kong Government set up the cultural policy aims to create an environment which is conductive to freedom of expression and artistic creation, and encourage more community to join in the cultural activities (Home Affairs Bureau, 2008). Besides, Hong Kong Art Development Council, a legal institution indicated by Hong Kong Government, to fund, plan policy, advocacy and promotion, develop and plan activities, which create the opportunity for community to access the art, and create a general mood to encourage community to develop their mind of art (Hong Kong Arts Development Council, 2010).

Economic Environment

According to the web site of Hong Kong Trade Development Council an article written by I Fan, I. & Yim, J., 2010, both are Chief Economists of Heng Seng Bank, predicted that the economics of Hong Kong is recover from the Financial Tsunami and back to the growth period. Besides, the web site of Hong Kong Economy, 2010, shows that in 2009 to 2010, the private consumption expenditure is rising, which means that consumers are now confidence on consumption. Besides, composite consumer price index shows that the product price is in average and the retail sales is in the high status in past ten years, which means that consumers is satisfy on product price and its shows that the product price is still low in consumers’ mind.

Social Cultural Environment

The word “Collective memory” has always around us in recent years. Collective memory means that communities have the common memory, feeling and story in the same places or period. In Hong Kong, such as the Queen’s Pier, Lai Chi Kok Zoo, Tsim Sha Tsui Clock Tower; artists such as Lydai Shum Din Ha, Spemcer Lam Sheung Yee, Bruce Lee Jun Fan, even the Polaroid, a trend of Hong Kong in 90’s.

Technological Environment

In a time of continuous rapid technological changes, something we imagined before could be realized nowadays. One of the important technologies is nanotechnology, it can create a lot of revolution electronic products, produces, and applications, such as Nokia had used this technology to create Nokia Morph, which is a concept cell phone can change its shape variety, show the image and video, and even charge the battery by used solar (Nokia, 2010). Besides, as the Web-based technology had a sharply utilized in recent years, information are easy to collect nowadays. Companies are now put their product information on their home web site and through the social network such as Facebook, Msn, Twitter, etc. to promotion their product thus achieve their marketing strategy.

SWOT Analysis

After the environment analysis in both internal and external of Polaroid in Hong Kong market, SWOT analysis will be utilized for determine that the strengths, weakness, opportunities and threats of Polaroid.

Strengths

Strong brand name would be one of the strength of Polaroid. When people talk about instant camera they would first think that it is Polaroid camera, therefore it is a symbol of instant camera and people will choose their instant product priority. Besides, Polaroid has many experiences on produce instant products, therefore it has a strong technology background on produce a new model of instant products.

Weaknesses

Polaroid has a poor selling performance on their instant products because of the digital camera, there may have an effect on their financial performance and thus affect their innovation. Besides, easy to imitate by the competitors is also a problem for Polaroid as the competitors also have a level of technologies on produce the camera.

Opportunities

Economic environment shows that people are willing to consume recently, release the new product can decrease the risk of selling performance as people are willing to try new things in this moment. Besides, as new technology such as nanotechnology becomes maturely. It is a advantage for companies to innovate the new products.

Threat

There is only one threat of Polaroid which is there are too many competitors in Hong Kong’s camera market. Unless Polaroid can be the first mover to produce a generation product like the digital camera, to let the customer leave out their digital camera and buy the new product released by Polaroid, otherwise Polaroid still needs to face the great competition in this market.

Introducing and describing the new product

VP1 Series is the first instant camera in the world which can collect the video and show the video in its special own instant film. The principle of take the video into the instant film is firstly use the VP1 instant camera to collect the image, movement and light perception, as the inside design of the camera is same as the original Polaroid instant camera so that the video can contains the unique feeling and style of Polaroid. After that, several of information will transfer as codes, and sent to the instant film through infrared ray. The instant film contains an IC in it to store the video. Besides, it is made by nano so that the film can treat as a screen to show the video. In addition, the Polaroid ink will still inside in the film like the original design, when the film is moving out from the camera the ink will permeate and mix with the nano to let the film becomes yellowish or greenish. Moreover, the nano can also use for receive the solar and transfer it to be the energy for active the video, therefore, the video can keep till the end of the world (Introduction to Nanotechnology, 2010).

However, VP1 instant camera had also support user to use the normal instant film which had already existing in the market. VP1 instant camera will automatically change the function to only can take the photo as it can detect the IC from the VP1 instant film.

VP1 instant camera will provide seven colors in the market, as the product aims to suitable for everyone, however, different people will have different needs and wants, therefore, VP1 instant camera provide different color in the market can solve this problem and catch up the largest share in the market.

Recommendations on the Marketing Mix Strategies

Product

VP1 instant camera is a hi-tech product therefore its conformation is very precise, so that the package should highly focus on safe. Cardboard is used to fix up a camera, and let the camera can stable in the box. Besides, the material of the box is also used the cardboard as it can recycle and decrease the pollution. The print on the box should be show the big size logo of Polaroid as the brand is a benefit for sell. Besides, the box should print out the color of camera it involved and the design should be fashion, to express that it is like an art work, lastly, model name VP1 instant camera will also print out on the box.

The package of VP1 instant film will simple than the VP1 instant camera. Cardboard box will still use for package ten instant films with moisture-proof, to extent the valid period. The print of the box will also big size logo of Polaroid with its model, VP1 instant film, the color of the box will be used the original film package color blue.

The last type of package is put all the VP1 products with their own package into same cardboard box, the print will used the color of camera it involved and design should be fashion, with the big size logo of Polaroid and its model name, VP1 series.

For the brand strategy, brand extensions will be used, and that means VP1 will branded under Polaroid. It is because its brand name has a dominant position of instant camera in the customers mind, therefore it is easy for customers to identify and memorize its product’s quality and benefit, thus willing to buy VP1.VP1 Series and its instant camera’s customers will enjoy first two years of free maintenance as it is an after sell service. After two years, customers can alternative to choose whether purchases the extent service period for two years with price three hundred dollars, the service include maintenance and spare parts support, whether due to customer preferences.

Price

Pricing strategies usually change as the product passes through its life cycle. The introductory stage is especially challenging. In face the challenge of setting prices for the first time, we choose Market-Skimming Pricing, which means the price for VP1 will setting high to skim maximum revenue layer by layer from the segments willing to pay the high price, and therefore the company makes fewer but more profitable sales.

By using product-mix pricing strategy, captive-product pricing strategy will be used for the single buy of VP1 instant camera and film. As using Market-Skimming Pricing, the instant camera will price $2000 and the instant film will price $150, both are expensive than the normal ones. However, if the customers are buying VP1 Series, then the price will be $2100, as using product bundle pricing strategy, to attract customers to my the series one.

Polaroid will using discount and allowance pricing strategy adjust their basic price to reward customers for certain response. For the retail customers, 10 days early payment of bills and volume purchases of 5000 unit will be given 20% discount. For end-user customers, off-season buying and some festival will be given 10% to 15% discount.

Place

There are two levels of consumer marketing channel. First level is Polaroid directly sales the VP1’s product to the end-user customers. Polaroid will rent the counters in chain electronic retailer store such as Broadway, Fortress, and Citicall, and sell them suffuse in Hong Kong 18 districts. Second level is Polaroid sells the VP1’s product to the retail customers, and the retail customers sell the products into their own retailer shops to the end-users customers.

Promotion

According to Promotion Mix Strategies, push strategy will be suitable for Polaroid to sell VP1’s product. It is because VP1’s product is easy to imitate, therefore, rush release is suitable for Polaroid. However, pull strategy needs to wait the customers to take order, and it will slow down the speed for release the product.

Besides, we will use some promotion tool to help us to introduce our product to the customer.

The common use of promotion is advertising; there have much type of media for us to put our advertisement in it, for example the TV channel, magazine, and the Web, etc. By using TV channel. We are not only use the general merchandising for promote our products, example, personal selling, sales promotion etc. Furthermore, we will cooperate with television station, to promote our products on information programmes.

We have to select the types of magazines publisher carefully, before advertise our product in those magazines. We would like to give the consumers an impression that our products are high technology and fashion. Hence, we recommend publishing the advertisements on some computer magazines and the teenagers’ magazines.

Web is a low cost advertisement, but if we use it efficiently, it still will have a great effect. Place an electronic banner in the famous Web site such as Yahoo!, Msn, Google, etc. which can attract more people to pay attention, become want to know more our product’s preference, thereby increase the sales volume.

Reflective Statement

From the literature reviews, I have learnt about the procedure of how to develop a new product in the market, thus trained my creative ability. Besides, this assignment had reminded me many knowledge of Marketing, such as Segmentation and Marketing Mix Strategies, although I have learnt them before, less use will easy to forget.

Moreover, I have known about the Polaroid Corporation, although I have tried to search its information before as I am interest on instant camera, I am boarder my known for this company after finish this assignment, and I have also learnt for manipulate the instant film, which is the extra knowledge I received after this assignment.

This assignment let me regain the interest of Marketing and therefore I am now keen on do some improvement on me to increase my knowledge on the Marketing field. Firstly, I will read more books to boarder my strategy of marketing, because I think this step is the base of learning the Marketing field, after finish this step I can easy to understand people who write in the marketing journal and article. Then, it is necessary for me to read newspapers every day and buy some business magazine to read each week, this action can let me know more about the different company, thus help me easy to finish the marketing work in the future.