Marketing

International Marketing Mix Strategies

Executive Summary

This assignment supports to offer in-depth knowledge regarding the marketing plan. In this paper, Holiday Inn hotel has taken for the study purpose to analyse its new product launching (virtual tour facility) in the Australian market.

For this purpose, various tables are used, which supports to offer detailed understanding in a glance. Qualitative data collection approach is used in this study while referencing it from books, magazines, articles and journals.

1. Summary of Assignment 

Holiday Inn uses used various Joint Venture market-entry strategies to entry into the Australia market with the purpose to offer or launch their offering i.e. virtual tour facility. For this, Holiday Inn targeted the Australia market in which local people or tourist is covered by the hotel.

Moreover, holiday Inn positioned their services in the mind of the Australian people through highlighting their quality and unique facilities such as mentioning the destination, food and high comfort levels etc. Thus through such strategy, holiday Inn has achieved its objective and successfully enter into the Australian market.

2. Marketing Mix

To analyse the marketing mix of Holiday Inn, product strategy, pricing strategy, place and integrated marketing communication are discussed. Under product strategy, branding, packaging, labelling, quality, product mix, segments and augmented services are discussed regarding Holiday Inn virtual tour facility.

2.1 Product Strategy

2.1.1 Product Life Cycle (PLC)

According to the views of Solomon (2014), a new product goes through from various stages. The major stages of a product are introduction, growth, maturity and decline.

In the context of introduction stage of virtual tour facility in Australia, Holiday Inn needs to focus towards attracting the innovator consumers. In this stage, firm needs to give consideration towards branding, pricing strategy, promotional strategy, quality parameters, consumer feedback, etc.

After that in the growth stage, firm will need to give focus towards increasing the sales and profits, and because the company can start to benefit from economies of scale in production, the profit margins, as well as the overall amount of profit, will increase.

This makes it possible for businesses to invest more money in the promotional activity to maximize the potential of this growth stage.

2.1.2 Branding

For the purpose of branding, Holiday Inn can use the strategy of branding the new product of the firm on the basis of social media sites.

This strategy will remain assistive as in the current scenario; Australian consumers spend their most time over the mobile internet (Wilken, et al., 2015). Due to which, efficiency of social media branding has increased.

2.1.3 Packaging

In the context of packaging, Holiday Inn needs to introduce the virtual tour facility while focusing towards attractiveness, easy to use, compatible features and many other parameters (Wilken, et al., 2015).

2.1.4 Labelling

There is a need of labelling the features and services in an effective manner so that the visitors of the virtual tour can get the understanding about the service offering and the price parameters in an effective manner (Wilken, et al., 2015). There is also a need of labelling the discount offers and other additional information.

2.1.5 Quality

Firm should give high consideration towards quality parameters as quality is an aspect which supports to create long-term sustainability in the industry (Wilken, et al., 2015).

2.1.6 Product Mix/Depth and Width

Under this parameter, Holiday Inn needs to focus towards offering the overall detail regarding the product offering and the services available in it. The major product line or product width of Holiday Inn is accommodation, restaurant facility and bar.

Additionally, under product depth, firm offers the leisure facilities, hiring car facilities, etc. to the consumers (Leonidou, et al., 2013). So, there is a need of mentioning all these parameters in virtual tour so that consumers come to know about the overall services of Holiday Inn.

2.1.7 Segments

In the context of virtual tour facility, the target segment of Holiday Inn is those consumers who are willing to pay for lifestyle and appreciate innovative products or services (Sheth, & Sisodia, 2015). Moreover, as the cost of virtual tour facility is high, so the consumers who lie in the high income group can avail this service.

2.1.8 Augmented Services

Augmented services will support to attract the consumers on the basis of healthy and clean environment. Fresh feeling, quality services, spacious suite, etc. remains supportive to attract the Australian consumers as they prefer to avail the lodging facility where they get relaxed.

Moreover, Holiday Inn can market the properties and amenities on the basis of additional services of spa, fitness centre and swimming pool (Sheth, & Sisodia, 2015).

2.2 Pricing Strategy

According to the views of Schmidt, Spann, & Zeithammer (2014), pricing strategy plays vital role for the firm to deal in the industry. Good pricing strategy supports to increase the market sales while maximizing the profit margin.

Due to this reason, while setting the price, firm needs to focus towards various parameters. There are basically five major pricing strategies that are penetration, parity, skimming, relationship and bundling pricing strategies.

While determining the price of virtual tour facility in Australia, Holiday Inn includes production and distribution costs while focusing towards competitor offerings, positioning strategies and the business target customer base.

In the context of virtual tour facility in Australia, price skimming strategy as this strategy is based on setting high rates during the introductory phase which remain assistive to maximize the profit.

At the same time, firm lowers the prices gradually when the fierce competition will appear in the virtual tour facility (Sheth, & Sisodia, 2015). This strategy will remains supportive for Holiday Inn to recoup its development costs of new service launch in Australia market while creating the illusion of quality and exclusivity.

Moreover, price bundling strategy can also be used by the firm as it will remain supportive for Holiday Inn to attract the bulk guests in the hotel to avail the services.

It is an effective way of moving unsold items during the off season to take up the space while creating the value in the eyes of the target customers. It will attract huge number of consumers due to they become able to get something for free.

 
Factors Justification
Average income The pay ability of the Australian consumers is high due to increase in income in the last decades. Due to this reason, price skimming strategy will remain supportive to attract them (Shih, Chen, & Chen, 2013).

At the same time, due to increase in average income, Australian people prefer to go on trip or to avail hotel services for getting relaxed. Due to which, bundling strategy is adequate as it will support to decrease the intensity of competition and attract the group to avail the services of Holiday Inn while receiving few free services too.

GDP The GDP of Australian market is showing decreasing trend, which can adversely impact the buying behavior of Australian consumers. So, in this context, price skimming strategy will remain supportive to mould the price on the basis of the behavior of GDP (Helm, & Gritsch, 2014). In like manner, bundling pricing strategy will support to attract the consumers even when there is decreased trend of GDP.
Tax The corporate tax rate of Australian market is 30%, which is stable and has not shown any change.
Currency exchange rate The currency exchange rate of Australian market has decreased which creates the opportunity of increasing the foreign tourism spending Australia (Helm, & Gritsch, 2014). It will support to boost the use of virtual tour services as it will increase the purchasing power of this services of the foreign tourists due to decrease in cost.

 

Average Competitors Price In the context of Australian market, there are only few hotels, which are offering the facility of virtual tour services (Helm, & Gritsch, 2014). So, the pricing strategies of these firms are premium based.
Cost:

– Production

– Distribution  
– Employees
– Material
– Marketing
-Research & Development
-Quality Control
-Testing
-Administration Cost
-Office & Utilities

2.3 Place

Channels

There is a need of utilizing the online channel to attract the consumers as in the current scenario, Australian consumers spend more time on internet instead of television, radio or print media (Sheth, & Sisodia, 2015).

Preferred Intensity of Distribution

There should be exclusive intensity of distribution in the context of virtual tour facility as it will enable to interact with the target consumers. In like manner, this service can be availed by the high income group personalities (Rundh, 2013). Moreover, there is a need of utilizing lower intensity of distribution as this service will not be availed by huge population but by the specific population.

Place of Retailers

Firm can offer the services to the consumers to provide the virtual tour facility at their place by sending the executive to their doorstep (Brookes, & Altinay, 2011).

2.4 Communication Promotional Mix

2.4.1 IMC (Integrated Marketing Communication)

Integrated Marketing Communication

From the above pie chart, it can be analysed that there are various sources which will use by Holiday Inn to promote the virtual tour in the Australian market.

For this firm will use public relations, direct marketing, sales promotion and advertising IMC activities (Finne, et al., 2017). These strategies will assist the firm to promote its new product in Australian market.

2.5. People

2.5.1 Training

There is a need of providing adequate training to the employees so that they can perform in an efficient manner in the context of handling this service (Shi, et al., 2014). This is advanced and latest service, so training will enable the employees to offer adequate services to the consumers.

2.5.2 Recruitment

Firm needs to focus towards recruiting the experienced, knowledgeable and skilled workforce, who can handle the advanced technology and changing environment need in an adequate manner (Derous, & De Fruyt, 2016). Moreover, they can motivate and encourage the subordinates to perform better.

2.5.3 Occupational health and safety laws

Holiday Inn needs to focus towards applying the occupational Australian health and safety law in an adequate manner within the premises. So, that employee remains satisfied with the firm.

It will enable to increase the employee performance by decreasing the absenteeism, while increasing the concern towards achieving the organizational goal (Rundh, 2013). Additionally, it remains supportive to decrease the employee turnover which helps to reduce the time wastage as well as firm costing.

3 Economic Evaluation

In the context of virtual tour facility, it can be assumed that the buyer decision process for the new product initially remains slow at the beginning but after that it will increase due to good experience of the consumers (Guo, et al., 2013). Additionally, it is found that in the initial stage, there is fewer consumers who prefer to avail the innovative services in the context of Australia.

At the same time, in the context of Holiday Inn virtual tour facility, it is analysed that there are only 2.5% innovators, 13.5% early adopters, 34% early majority, 34% late majority and 16% laggards. From the above data, it can be interpreted that most of the consumers can be achieve in the early majority and late majority stage.

The population of Australia is 24.3 Million and firm is focused to target early adopters and innovators in the 2 years and then next three years, firm will focus on early majority. The objective of the firm is to 10% market share in 5 years. In the starting two years firm will become able to target 16% population and that is 3.8 Million. In the next three years, firm will target 34% (early majority) population that is 8.26 Million.

The firm has an objective of achieving 10% market share in the time span of 3 years

The expected revenue of Hotel Inn is .826 Million x price (assuming $10) = $8.26 Million. That is the amount which the firm wants to earn after 5 years.

Year 1 – According to 4% Market share – $3.3 Million

Year 2 – According to 8% market share – $6.6 Million

Year 3 – According to 10% market share – $8.26 Million

Reduction/Monitoring Process

Costs Reduction/Monitoring Process
– Production Minimizing the wastage of time while effectively utilizing the manpower resources.
– Distribution Through hiring freelancer employees of different locations
– Employees Basic salary will be low and target based amount should be good
– Material There is a need of maintaining the equipment and tools in an adequate manner to decrease the chances of any kind of damages and cost.
– Marketing Digital marketing will remain effective and will decrease the cost
-Research & Development Online research and development process should be implement (Koh, Jung-Eun Yoo, & Boger Jr, 2010)
-Quality Control Need of utilize digital quality check instead of manual checking
-Testing Need of effective testing, so that the expense for again and again testing will decrease
-Administration Cost Implementation of waste management strategy
-Office & Utilities Increasing the trend of reusability

 

From the above table, it can be understood that Holiday Inn can utilize various strategies to eliminate the chances of over cost. Utilization of these strategies will support the organization to decrease the cost which will support to offer the services to the consumers in a reasonable price (Shi, et al., 2014).

4. Implementation and Control

4.1 Product during Time Frame

Activity Responsible Jan Feb Mar Apr May Jun
Market research
Political, Economical condition, Social and culture, Technological factors, Legal factors, Environment (PESTLE) Marketing team
Market Survey
Research Analysis
Production Plan
Sourcing local manufacturers Production team
Sourcing local suppliers
Production sampling
Analyzing the sample result Production and Marketing team
Marketing Plan
Market Analysis Marketing team
Competitors Analysis
Distribution research
Sourcing effective local distributors Marketing team
Recruitment
Local employment HR team
Training
Training program HR team

From the above table, it can be analysed that different activities will be completed in different time frame. Moreover, there are few activities which will run simultaneously. Above framework has supported to pre-determine the time framework which is needed to accomplish the task.

4.2 Communication Plan

Activity Responsible Jul Aug Sep Oct Nov Dec
Promotion Plan
Event sponsor planning Digital Marketing team
Social media creating
Sale promotion planning
Budgeting
Costs Analysis Top Management and Accounts Department
Pricing
Estimating Price Accounts Department
Product Launch
Launching the Product into the market Production and Marketing team
Feedback
Collecting feedback of customer satisfaction and sale Marketing team
Annual report
Providing relevant information for Annual report Production and Marketing team

Above communication plan has supported to analyse the time frame needed to accomplish the different communication activity which are related to planning, costing, pricing, launching, feedback collecting and reporting.

4.3 Monitoring of Action Plan

Activity Measurement Responsible Activity completion date(s) Memo
Market Research (PESTLE) Determine macro-environmental opportunities that will benefit the company Marketing Team One year before release date Opportunities must be consistent with company objectives
Market survey Including relevant questions Marketing Team 10 months before release date To understand the consumer perception
Market Research and survey Analysis Use of SPSS tool Marketing Team 9 months before release date To analyze the parameters which need to be included in the product
Sourcing local manufacturers Price, quality and delivery time Production Team 9 months before release date To increase the customer satisfaction
Sourcing local suppliers Price, quality and delivery time Production team 9 months before release date To increase the quality material
Production sampling Effective sampling Production team 9 months before release date To improve the quality standards
Analyzing the sample result Implication of reliable method Production and Marketing team 8 months before release date To identify the areas where there is a need of work
Market Analysis Adequate sample size Marketing team 9 months before release date To get adequate information
Competitors Analysis In the Australian market Marketing team 9 months before release date To develop effective strategy
Sourcing effective local distributors Price, timely delivery Marketing team 7 months before release date To eliminate the situation of inconvenience
Local employee recruitment Skills required for particular job position HR team 7 months before release date To improve the quality of work
Training Adequate training according to the job position HR team 6 months before release date To increase the skills and knowledge
Marketing plan for Event sponsor,

Social media and

Sale promotion

Complete in timely manner while focusing toward attractiveness and informatics Digital Marketing team Two months before release date To increase the awareness about the new launch
Budgeting Should include each and every aspect Top Management and Accounts Department Two months before release date Pre-determine the cost and to eliminate extra costing
Pricing Should be competitive Accounts Department Two months before release date To retain the consumers while increasing the brand loyalty
Product launch Utilize the strategy to capture the market while creating effective awareness and curiosity regarding the new launch Production and Marketing team One month before release date To get success in the Australian market
Collecting Feedback Only collect reliable feedback Marketing team One week before release date To understand the customers perspectives
Annual Report Include all the parameters Production and Marketing team Two week before release date To create transparency

Above table has supported to understand the different activities and the measurement, responsible person, activity completion data and memo. It has supported to offer the detailed understanding regarding the activities which Holiday Inn will include to launch the virtual tour facility in the market.

4.4 Contingency Plans

Activity Possible Issue Prospect of occurrence Modification
Sourcing local manufacturers High cost High Bulk purchasing
Sourcing local suppliers Quality Medium Evaluation of suppliers
Production sampling Inadequate method implication Low Applying adequate methods
Local employee recruitment Wastage of time and money Medium Hiring consultancy firm
Training Increase cost Medium Providing the necessary training for particular job position
Budgeting Increase of cost from the decided budget  

High

Waste management and prioritizing
Product launch Delay Medium Accomplishment of every task in a timely manner
Exit Strategy Failure of product Low Improving the product while decreasing the price

This table has supported to understand the activities and the possible issues related to it while discussing the prospect of occurrence and the ways for modification. So, it will support to forecast the issues and the steps which can be taken to eliminate the situation of occurrence.

References

Brookes, M., & Altinay, L. (2011). Franchise partner selection: perspectives of franchisors and franchisees. Journal of Services Marketing25(5), 336-348.

Derous, E., & De Fruyt, F. (2016). Developments in Recruitment and Selection Research. International Journal of Selection and Assessment24(1), 1-3.

Finne, Å., Finne, Å., Grönroos, C., & Grönroos, C. (2017). Communication-in-use: customer-integrated marketing communication. European Journal of Marketing51(3), 445-463.

Guo, X., Ling, L., Yang, C., Li, Z., & Liang, L. (2013). Optimal pricing strategy based on market segmentation for service products using online reservation systems: An application to hotel rooms. International Journal of Hospitality Management35, 274-281.

Helm, R., & Gritsch, S. (2014). Examining the influence of uncertainty on marketing mix strategy elements in emerging business to business export-markets. International Business Review, 23(2), 418-428.

Koh, S., Jung-Eun Yoo, J., & Boger Jr, C. A. (2010). Importance-performance analysis with benefit segmentation of spa goers. International Journal of Contemporary Hospitality Management22(5), 718-735.

Leonidou, L. C., Leonidou, C. N., Fotiadis, T. A., & Zeriti, A. (2013). Resources and capabilities as drivers of hotel environmental marketing strategy: Implications for competitive advantage and performance. Tourism Management, 35, 94-110.

Rundh, B. (2013). Linking packaging to marketing: how packaging is influencing the marketing strategy. British Food Journal, 115(11), 1547-1563.

Schmidt, K. M., Spann, M., & Zeithammer, R. (2014). Pay what you want as a marketing strategy in monopolistic and competitive markets. Management Science, 61(6), 1217-1236.

Sheth, J. N., & Sisodia, R. S. (2015). Does marketing need reform?: Fresh perspectives on the future. Routledge.

Shi, W. S., Sun, S. L., Pinkham, B. C., & Peng, M. W. (2014). Domestic alliance network to attract foreign partners: Evidence from international joint ventures in China. Journal of International Business Studies45(3), 338-362.

Shih, B. Y., Chen, C. Y., & Chen, Z. S. (2013). Retracted: an empirical study of an internet marketing strategy for search engine optimization. Human Factors and Ergonomics in Manufacturing & Service Industries, 23(6), 528-540.

Solomon, M. R. (2014). Consumer behavior: Buying, having, and being (Vol. 10). Upper Saddle River, NJ: Prentice Hall.

Wilken, M. F., MacDonald, J. C., Erickson, G. E., Klopfenstein, T. J., Schneider, C. J., Luebbe, K. M., & Kachman, S. D. (2015). Marketing strategy influences optimum marketing date of steers in relation to corn price and days on feed11A contribution of the University of Nebraska Agricultural Research Division, supported in part by funds provided through the Hatch Act. The Professional Animal Scientist, 31(3), 224-236.

 

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