Discuss About The Generation Marketing Strategies Engaging.
Entrepreneurship is the process of starting a new business venture. The individual or group of individuals who start this new business are better known as entrepreneurs (Drucket, 2014). There are various advantages of starting new businesses. It is the sign of growth for an economy. This is why various governments promote these startups by offering them subsidies and tax rebates (Kirzner, 2015). This particular reports highlights the business of a product which is an E-book reader. The product assists people to download millions of books in the form of electronic copies. The report throws light on the marketing mix, industry analysis and a brief background about the new idea.
I have always been an avid reader which has adversely impacted my eyesight. Very often, it has been noticed that people who prefer to read books at night face a lot of problems. First of all it is an added pressure on their eyes. Secondly, while holding a thick book, it is difficult to lay down in a comfortable position. The advent of various E-book readers has changed the shape of the book industry. This is why a new product ‘E-book’ reader has been introduced which has a longer battery life and a better reading platform.
The mission is to offer a comfortable reading experience to customers and provide a user friendly platform which instils and enhances the habit of reading as a form of enhancing knowledge.
The product offers an electronic 8 inch device which can be connected to the internet. Electronic books can be downloaded and accessed. The brightness of the device can be adjusted as per the requirements of the reader. This also makes it possible for the readers to carry a large number of books during their travel and in their bags.
The product offers a convenient style of reading books. The platform is user friendly and can be accessed by adults as well as children. The users can select 10 electronic books which would be made available free at the time of purchase. This device comes with a cover. The users can make notes of what they are reading. Moreover, users can also share the books with others via social media platforms.
The Ebook reader industry is unique and the biggest player of the industry is Amazon’s Kindle which includes 73.7% of the market share (Statista, 2018). Besides that other players are Kobo and Nook. The industry is at a growing stage and there is still space for new entrants before the industry turns Red Ocean. E-books have existed since a long time but it was only the advent of Kindle that led to the growth of the industry. This makes it a perfect time to introduce a competent product in this industry. The lesser number of competitors make it easier for the product to enter the industry. The bargaining power of customers and suppliers is relatively low as of now but is sure to increase in the near future.
The biggest competition that will be faced by the product is Amazon’s Kindle. Kindle was launched in 2007 and has sold millions of devices since then. In order to respond to market competition, it is essential that organizations differentiate their products. This differentiation can be in the form of price, promotion or product offering. The new E-book reader will have a battery life of over 12 days as opposed to Kindle’s 7 days. This reflects that the users of the device would not have to charge the product as frequently. The price of the basic product would also be lower than Kindle’s basic model’s price. This will lead to a price differentiation and help the product in gaining a competitive advantage over the pricing strategy adopted by the product.
Target market includes the set of customers whose needs the organization aims to fulfill (Armstrong et. al., 2015). Defining an appropriate target market is extremely crucial for the success of the organization. For the new product, the primary target market would include avid readers. Demographically, they can fall into any caste, religion or age. In terms of psychographic segmentation, it is essential that the business targets customers who are well read. Students could be targeted so that they can study their books using the product. Young children could be targeted in order to instil the habit of reading in them at an early age.
Identifying the marketing mix of the new product at an early age is crucial to the success of the business (Gordon, 2014). It helps businesses in identifying various different facets about the organizational offering.
The basic product offered here is an Electronic books readers that offers users a comfortable reading experience. The device is 8 inches long and can be connected to the internet. The device offers 4GB of space which means thousands of books can be downloaded in the device. The device’s brightness can be adjusted depending upon the requirement of the reader. People can also create a social community where they can discuss about the books they read and share books with their friends and acquaintances. The product’s essential aim is to offer a competent reading experience. The users can change the font styles and sizes of the books as per their preferences. The product offers a long battery life of over 12 days. Overall the product is a suitable alternative to hard copies of books that are currently widely prevalent in the market.
Four different models of the product would be introduced. The first would be a basic model that would allow users to read the books. This would be followed by premium models which offer better battery life, internal storage, screen quality, flashlight and book scanners.
|
Product attribute |
Basic Model |
2nd model |
3rd model |
4th model |
|
Book downloader |
Yes |
Yes |
Yes |
Yes |
|
Brightness adjustment |
No |
Yes |
Yes |
Yes |
|
Audio books |
No |
No |
Yes |
Yes |
|
Internal memory |
1GB |
1.5GB |
3GB |
4GB |
|
Flash light |
No |
No |
Yes |
Yes |
|
Book scanner |
No |
No |
No |
Yes |
|
Battery life |
8 days |
10 days |
11 days |
15 days |
Place throws light on the places where the book reading device would be made available and sold. The book reader would largely appeal to technologically savvy audience and hence it is imperative that the device is sold on Ecommerce platforms like Flipkart and Alibaba. This will help the book reach out to a large number of customer across the globe. The primary stores for the device would be opened in Australia in order to target the local consumers. However, the product can be exported to different parts of the world and be ordered online for international customers.
Besides that the book reading device can be made available in various book stores like Crossword. The outlets must be located at convenient commercial locations that are easily accessible to people in the city. The place where the product is sold has a large impact on how many products would be sold. This is why it is important that businesses decide the place where the product would be sold after thorough analysis.
Price penetration strategy would be adopted by the device. Penetration pricing refers the act of pricing a product lower than other players in the market in order to reduce competition (Schindler & Schindler, 2011). The E-book reading device would be priced much lower than other players in the market specifically with an aim to compete effectively with Amazon’s Kindle.
The products four different models would be priced differently based on their offerings. The basic model would be charged much lower than the Kindle. On the other hand the premium or the 4th model would adopt a premium pricing strategy. The price of the last model would be very high. This would be the only Ebook reader device that would have the ability to scan hard copies of books and download them as electronic books. Premium pricing refers to the strategy of pricing the products relatively higher than the competitors in order to set a premium positioning in the minds of consumers (Prasad et. al., 2015).
The reason behind using two different pricing strategies is for the business to be able to target a large set of customers. The basic model with a lesser price can be used to target teenagers, students and lower income groups of the society. On the other hand, the premium model can be used to target businessmen, working women and higher income members of the society. Pricing strategy plays an important role in the success of the business and this is why it is important that the products are priced strategically (Zhang et. al., 2014).
Promotion strategies are adopted by firms to reach out to their target consumers. Businesses must adopt strategic promotion strategies in order to ensure that their customers are effectively targeted (Singh, 2012). Given below are a few strategies that will be adopted by the Ebook reader business model:
Digital marketing: Digital marketing refers to the process of marketing a product or a service via digital platforms. Digital marketing strategies help organizations in optimizing their search and marketing on search engines like Yahoo, Google and Bing (Ryan, 2016). This makes it essentially easier for customers of the business to search for the product and get the right information online. Digital marketing is important to establish digital presence (Stokes, 2011). This is especially true for technologically savvy products like E-book readers.
Social media marketing: The process of promoting any product or service on social media platforms like Facebook, Instagram or Twitter is better known as social media marketing (Tuten & Solomon, 2017). It is widely prevalent and has helped leading brands in reaching out to a large number of customers with the help of a single platform. Social media marketing of the Ebook reading device would include establishing and maintaining a Facebook page and a twitter account. The brand can advertise its offerings through this page and reach out to customers. It is important to note that unlike other promotional tools, Social media marketing creates a platform for customers and organizations to interact. Customers can provide feedback about the reading device and based on the feedback, the device can be constructed further.
Print ads: Print ads are a traditional form of marketing but will be highly effective to promote the E-book reader. It is important the organization hires an effective advertising agency and continues to curate creative ads that are appealing to the audience and garners attention and trust from across the globe. Print ads include advertisements done via newspapers and magazines. Despite the advent of technology, there are a large number of people who read the newspaper first thing in the morning. This is why they must be targeted via creative and attention grabbing advertisements in the newspaper. Magazine ads could be designed to target businessmen and working women.
Television ads: Television ads have been used since a long time to attract customers and set the right positioning in the minds of consumers. E-book reading device can adopt to advertising the product on television especially to target families in order to make them understand the importance and the benefits of children studying with the help of the device. These advertisements would also present a visual of how the device would look and work. This may be helpful in garnering more attention for the product.
Influencer marketing: Influencer marketing refers to the process of asking an influencing personality to promote the product (Weiss, 2014). These influencers include actors, singers, standup comedians, YouTube artists and many more. They can be approached through their managers or free samples could be sent to them. If they like the device then they would promote it across their social media pages wherein they have a huge number of followers. Hence it would make it easier for the brand to reach out to a large audience through a single channel.
Billboards and hoardings: Billboards and hoardings can be placed across different parts of the city in order to grab attention of daily passersby. The ads placed on the boards must be effectively designed and creatively curated. The ads must change every few weeks and should be interesting enough to hold attention of someone who is driving a vehicle. This promotional strategy is local in nature and can only target people from a particular geographic area. Nevertheless the strategy should be used in Australia.
There are various resources that would be required by an electronic book reader device business. The initial investment required by the business would be as below:
|
Particulars |
Approximate expenses |
|
Recruitment costs and salaries of employees |
AUD 4000 |
|
IT expenses |
AUD 11000 |
|
Rent and office infrastructure |
AUD 7000 |
|
Sales, marketing and PR costs |
AUD 4500 |
|
Office overheads |
AUD 1500 |
|
Total |
AUD 28000 |
|
Year |
Expected Costs |
Expected Revenue |
|
Year 1 |
AUD 28000 |
>= AUD 24000 |
|
Year 2 |
AUD 34000 |
>= AUD 38000 |
Therefore, the business will achieve break-even in the second year of running.
Reluctance to buy the product: Because the product will be new to the market, the product will face the risk of not being entirely accepted by consumers. This is the risk posed for every new product that aims to be launched in the market. However, this is the risk that every new business has to take. A contingent plan must also be ready to counter this risk. This plan might include targeting a different customer segments, adopting newer promotional strategies and offering competitive prices.
Competition from Amazon: Another major threat posed to the product would be a severe competition from Amazon Kindle which has been widely accepted in the market and continues to grow in terms of market share (Gilbert, 2015). The brand name of Amazon is a solid factor that enables people to trust Kindle. Any new product would have to work much harder to reach that level of trust or appreciation.
The look and feel of a book: Lastly, all the avid book readers understand the importance of being able to touch a book, admire through its cover page and read it. Therefore an important aspect of book reading is missing in this particular product and this is a major threat posed by the product.
Conclusion
The new product in the report is an Electronic books reader. It is an 8 inch device that allows users to download a large number of books to read. Customers can connect the device to internet and download books that are available online. The product is aimed at offering a comfortable reading experience to its users. There are two different pricing strategies that would be adopted. The basic product would be using a penetration pricing strategy and the higher end model would be using a premium pricing strategy. Social media, digital tools, television ads, print ads and influencer marketing strategies would be adopted by the business to promote the product.
It is a tough competition with Amazon’s Kindle but differentiated strategies, unique offerings and effective promotions can help the product in establishing a solid market share in the industry.
References
Armstrong, G., Kotler, P., Harker, M. and Brennan, R., 2015. Marketing: an introduction. Pearson Education.
Drucker, P., 2014. Innovation and entrepreneurship. Routledge. United Kingdom.
Gilbert, R.J., 2015. E-books: A tale of digital disruption. Journal of Economic Perspectives, 29(3), pp.165-84.
Gordon, R., 2012. Re-thinking and re-tooling the social marketing mix. Australasian Marketing Journal (AMJ), 20(2), pp.122-126.
Kirzner, I.M., 2015. Competition and entrepreneurship. University of Chicago press.
Prasad, A., Venkatesh, R. and Mahajan, V., 2015. Product bundling or reserved product pricing? Price discrimination with myopic and strategic consumers. International Journal of Research in Marketing, 32(1), pp.1-8.
Ryan, D., 2016. Understanding digital marketing: marketing strategies for engaging the digital generation. Kogan Page Publishers.
Schindler, R.M. and Schindler, R., 2011. Pricing strategies: a marketing approach. Sage. United Kingdom.
Singh, M., 2012. Marketing mix of 4P’s for competitive advantage. IOSR Journal of Business and Management, 3(6), pp.40-45.
Statista, 2018. ‘Amazon’s Kindle E-Readers: Global Market Share’. Available at https://www.statista.com/statistics/276508/global-market-share-of-amazons-kindle-e-readers/. Accessed on 27 May, 2018.
Stokes, R., 2011. eMarketing: The essential guide to digital marketing. Quirk eMarketing.
Tuten, T.L. and Solomon, M.R., 2017. Social media marketing. Sage. United States of America.
Weiss, R., 2014. Influencer marketing. How word-of-mouth marketing can strengthen your organization’s brand. Marketing health services, 34(1), pp.16-17.
Zhang, J., Chiang, W.Y.K. and Liang, L., 2014. Strategic pricing with reference effects in a competitive supply chain. Omega, 44, pp.126-135.
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