Marketing Plan

Running Head: PARADISE COOKWARE 1

PARADISE COOKWARE 9

Assignment #1

Part A: Marketing Plan/ Paradise Cookware

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MKT 500, Online

10/02/2014

Introduction

The “Paradise Cookware” company has been in this business since the year of 1979. They have been making cookware at a place called the Prince Edwards Islands, which is located in Canada and Charleston, S.C. The company designs and produces cookware specifically for people in North America. This company offers pans, pots, and a lot of different cookware types for not only individual clients but also for corporate clients

Executive Summary Placeholder

This “Paradise Cookware” company is a company that is in the lead with a luxury type segment of cookware in not only United States but Canada too. The positioning strategy will be based on the emphasis of nothing but quality products while at the same time these products will be higher among comparable items.

Environmental Analysis

Competitive forces: These products are available with a big variety of all types of cookware. They are available in both the United States and Canada. Within this cookware group, there are about 216 brands that are available at retail through Cookware manufacturers association (Cookware manufacturers association, 2014). A Vast majority of companies operate at several segments of the market simultaneously.

Economic forces: We know from research that all cookware and kitchen stores within this industry has been faced with a large number of declines. This is because of the recession that we faced which caused the decrease in disposable incomes of customers. Looking at the time frame of about 2014 to 2018, we see that the revenue is expected to grow bigger as consumers go forth with increasing their spending on luxury industry products (IBIS World, 2013).

Political forces: The increase in export-import operations because of changes of the trade regulations between the United States and some of the world’s largest manufacturers of cookware (like China). Cookware, manufactured in the USA and Canada are at a competitive disadvantage with respect to the ones that are manufactured overseas. The luxury segment of the market is estimated to be way less vulnerable to this trend as the other segments are.

Legal and regulatory forces: These products comply with the U.S. and Canadian safety guidelines. The tort liability of the company is very ensured.

Technological forces: These products are manufactured with the utmost regards to technology that is advanced in the cookware field of manufacturing. The company is also monitored thoroughly with the development of the industry-related technologies.

Socio-cultural forces: Paradise Cookware will be responsive to its target commitment with having products that are of a high quality and its label “made in USA”. Techniques that are green will also be used.

The Target Market

The primary target market for this company would have to be females within the ages of 40-60. They will more than likely not have a job so that they are able to dedicate a large amount of their time to work around the house. Women that truly value a products quality and reliability will view the “Paradise Cookware” as an investment. Other types of customers that would be included with this company’s primary target would include market and corporate clients. This would be hotels and restaurants. A Secondary market would include women in the age range of 20-35. They would have to be employed or busy with housework and trend toward premium brands.

Performance Analysis

In the context of the assignment, performance analysis is similar to return-on-investment (ROI) that is calculated as follows: (gain from the investment-cost of investment)/cost of investment.

By knowing the benchmarking percentage, we will be able to transfer to the analysis of each of the metrics in order to compare the performance of the company to the performance of its closest competitor, namely Paderno.

Customer engagement is the metrics that is characterized through several other metrics, namely activity time and visit frequency (with regard to websites). The average number of visitors of the website of our company during a day is around 1500 people, while the average number of visitors of Padernos website is about 4000 people.

1500/4000=0.375. The number of Paderno website visitors exceeds the number of our unique visitors by 72.5 per cent.

Let us suggest that while the retention rate of the visitors of our company’s website was 30 per cent on January, the first, 2014, and on January, the fifteenth it was 50 per cent, while retention rate at Paderno company website was 50 per cent and 70 per cent respectively.

(50%-30%)/30%=0.6=60% - increase in retention rate

(70%-50%)/50%=0.4=40% - increase in retention rate

The number of website visitors can to great extent determine the revenue of the company due to the fact that all the products by both companies can be purchased on line through their official websites.

The market share is classical metrics, used in performance analysis. Paderno is still the leader of the market, enjoying the market share of 22%. In 2013 its market share increased by 1 per cent (from 22 to 32 per cent), while the market share of the “Paradise Cookware” increased from 11 to 15 per cent.

(23-22)/22=0.0045=4.5%

(15-11)/11=0.36=36%

The fact of growth can be explained by the introduction of several new distribution channels into the operation of the company last year, while, being confident in its leading position at the market, Paderno preferred not to introduce any changes to its strategies.

The rate of adoption can be defined as the relative speed that characterizes the process of social system’s members’ adopting an innovation. The factors that influence adoption rate include relative advantage (the degree of innovation’s improvement as compared with the previous generation) compatibility, complexity, trial-ability, as well as observability. In 2013 Paderno and the “Paradise Cookware” introduced similar new products. They were cookware sets, consisting of several cooking pans, steamers and covers. The adoption rate of Paderno new product was estimated to be up to 10 per cent higher than the one of the cookware set, introduced by the “Paradise Cookware”. The difference can be explained by the fact that Paderno aims at establishing long-term contractual relations with corporate clients, and offers new products to them as soon as they get to the market, while the “Paradise Cookware” still concentrates on communicating non-corporate clients.

Analysis of such metrics as the number of web site's visitors, their engagement (via retention rate), the market share and the level of new product’s adoption rates shows that the performance of the “Paradise Cookware” is in considerable need of improvement that will help the company maintain its market share without introducing so large-scale changes as the introduction of new distribution channels.

Four quantitative goals for the next stage of company’s development are as follows:

a. Increase the number of unique visitors of the company from 3.5. million people to 5 million

b. Increase the number of repeated visits to the website from 20 to 50%

c. Maintain the market share at the level of 15%

d. Expand to 2-4 new markets in Europe and North America

Four qualitative goals may include:

a. Strengthen communication between the brand and consumers, and among consumers through the website of the company

b. Create more attractive and customers’ needs-based design of the website

c. Elaborate on the program, aimed at promoting the establishment of long-term contractual relationships between the company and the consumer.

d. Increase trial-ability and observability of the company’s new products, so that they get higher rate of adoption

Product’s SWOT Analysis

SWOT analysis represents a type of extensive needs analysis, and is aimed at singling out strengths, weaknesses, threats and opportunities related to the product (in our case: to the cookware)

S: High quality Being produced with the help of green manufacturing methods Providing 25+ years warranty to reaffirm the company’s confidence in the quality Meeting needs of both individual and corporate clients	W: Narrow market segment (orientation on luxury segment only) The lack of product-related communication The lack of long-term relations with corporate clients High prices that do not become subjected to any types of discounts
O: Entering new segments of the market Creating different types of cookware sets Orientation on corporate clients Improving product-related communication	T: Significant level of competitive rivalry among the U.S. and Canadian cookware manufacturers Increase in import of cookware from China Decrease in consumers’ spending on cookware High costs of developing new products that will have considerable advantages as compared with previous generation of products

SWOT analysis shows that despite the company’s products’ high quality and the usage of green manufacturing techniques, product’s marketing mix is characterized with considerable range of weaknesses related to pricing and promotion. The observation of both weaknesses and threats makes it necessary to reconsider the market segment the company is currently operating within with respect to current state of competition at the market and the opportunities related to starting multi segment approach. Furthermore, promotion- and pricing-related challenges need to be addressed in the light of the need of improving communication with current segment of operation and the opportunity to enter a new one.

References

Baron. R., Shane, S. (2007). Entrepreneurship: a process perspective. Mason, OH: Cengage Learning

Cookware manufacturers association (2013). Brand finder. Retrieved from: http://www.cookware.org/

Iacobucci, D. (2014). MM4, Marketing Management. Mason, OH: Cengage Learning

IBIS World (2013). Kitchen cookware stores in the U.S.: market research report. Retrieved from: http://www.ibisworld.com/industry/kitchen-cookware-stores.html

Kahn, K. (2011). Product planning essentials. NY: M.E.Sharpe

Nicholas, J.M. (2004). Project management for business and engineering: principles and practice. Oxford: Elsevier

Stevens, R.E., Sherwood, P.K. (1982). How to prepare a quality feasibility study: a step-by-step guide. NY: Prentice Hall