Companies today recognize that they cannot appeal to all buyers in the marketplace – or at least not to all buyers in the same way. Buyers are too numerous, widely scattered, and varied in their needs and buying practices. Moreover, the companies themselves vary widely in their abilities to serve different segments of the market. Instead, like Best Buy, a company must identify the parts of the market that it can serve best and most profitably. It must design customer-driven marketing strategies that build the right relationships with the right customers.
Thus, most companies have moved away from mass marketing and towards target marketing in which they identifying market segments, selecting one or more of them, and developing products and marketing programs tailored to each. Instead of scattering their marketing efforts, firms are focusing on the buyers who have greater interest in the values they create best. 2. WHAT IS CUSTOMER-DRIVEN MARKETING STRATEGY? Customer-driven marketing strategy implemented based on the customer-driven. It creates value for targeted customers.
There are four major steps in designing a customer-driven marketing strategy. In the first two steps, the company select the customers that it will serve. Meanwhile, in the final two steps the company decides on a value proposition – how it will create value for target customers. Figure below illustrates on designing customer-driven marketing strategy. TASK 1: FOOD AND BEVERAGE INDUSTRY (Big Apple Donuts & Coffee) 1. BEHIND THE NAME The idea came from a group of passionate individuals who have vast experience in the food and beverage industry in Malaysia, Singapore, Indonesia and Thailand.
On the 2nd of May 2007, Big Apple Donuts & Coffee established itself in Malaysia with the opening of its first store at The Curve. It is wholly owned by Big Apple Interasia Sdn. Bhd, a parent company with several subsidiaries under its corporate umbrella. Its trademark store can be found in almost all major shopping malls across the country, and immediate plans are underway to expand to China, Thailand, Vietnam, and the Middle East. 2. IDENTIFYING ATTRACTIVE MARKET SEGMENT
Market Segmentation is the process that companies use to divide large, heterogeneous markets into small that can be reached more efficiently and effectively with products and services that match their unique needs. There is no way to segment a market. A marketer has to try different segmentation variables, alone and in combination, to find the best way to view market structure. The major variables that might be used in segmenting consumer markets are as follows: a)Geographic Segmentation: dividing a market into different geographical units, such as nations, states, regions, countries, cities, or even neighborhoods. )Demographic Segmentation: dividing the market into segments based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality. c)Psychographic Segmentation: dividing a market into different segments based on social class, lifestyle, or personality characteristics. d)Behavioral Segmentation: dividing a market into segments based on consumer knowledge, attitudes, uses, or responses to a product. (Principles Of Marketing, 14th edition by Kotler & Armstrong)
As Big Apple specialized in offering a wide range of donuts and beverages to people who want something different from the norm, they primarily consider Demographic Segmentation in order to select their customer. One reason is that customer needs, wants, and usage rates often vary closely with demographic variables. Another is that demographic variables are easier to measure than most other types of variables. In addition, Big Apple take age and life cycle stage into consideration while selecting potential customer as customer needs and wants change with age.
Instead of offering different products, Big Apple using different marketing approaches for different age and life cycle groups. For example, for older generations, they introducing standard size freshly fried donuts with different choices of filing and garnishing which are sold ala carte or coming with drinks. For children they offer “Donashi” – donut with a square and small shape like sushi (a Japanese food) with the same filing and garnishing. 3. THE DIFFERENT STRATEGIES IN TARGET MARKETING AND PRODUCT POSITIONING Market Targeting After evaluating different segments, the company must decide which and how many segments it will target.
A target market consists of a set of buyer sharing common needs or characteristics that the company decides to serve. Market targeting can be carried out at several different levels as follows: a)Undifferentiated Marketing: a market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. It focuses on common needs rather than what’s different. b)Differentiated Marketing: a market-coverage strategy in which a firm decides to target several market segments and designs separate offers for each.
The goal is to achieve higher sales and stronger position. c)Concentrated Marketing: a market-coverage strategy in which a firm goes after a large share of one or a few segments. d)Micromarketing: the practice of tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments; it includes local marketing and individual marketing (also known as one-to-one marketing). (Principles Of Marketing, 14th edition by Kotler & Armstrong) Differentiation and Positioning
Beyond deciding which segments of the market it will target, the company must decide on a value proposition – how it will create differentiated value of targeted segments and what positions it wants to occupy in those segments. A product’s position is the way the product is defined by consumers on important attributes – the place the product occupies in consumers’ minds relative to competing products. In planning their differentiation and positioning strategies, marketers often prepare positioning maps that show consumer perceptions of their brands versus competing products on important buying dimensions.
Some firms find it easy to choose a differentiation and positioning strategy. For example, a firm well known for quality in certain segments will go for this position in a new segment if there are enough buyers seeking quality. But in many cases, two or more firms will go after the same position. Then each will have to find other ways to set itself apart. Each firm must differentiate its offer by building a unique bundle of benefits that appeal to a substantial group within the segment.
Above all else, a brand’s positioning must serve the needs and preferences of well-defined target markets. For instance, when Big Apple compared to other coffee shops, they offer very different product assortments and store atmospheres. Yet each succeeds because it creates just the right value proposition for its unique mix of customers. The differentiation and propositioning task consists of three steps: identifying a set of differentiating competitive advantages on which to build a position, choosing the right competitive advantages, and selecting an overall positioning strategy.
The company must then effectively communicate and deliver the chosen position to the market. THAT EVERYDAY MAGIC The magic of Big Apple Donuts and Coffee doesn’t come simply from the product and brands, but also from the relationships, the innovation and the diversity of the people who contribute to the fun, energy and success of the organization every day. Reaching out, extending boundaries and finding common bonds are part of the real magic of Big Apple. Big Apple’s energy comes from relating to people and truly understanding their choices and tastes.
What drives Big Apple forward is the desire to ensure that across the country, their donuts will put a smile on people’s faces, any place and any time. DONUTS ARE THEIR WORLD ON A STAGE Adding to the magic of Big Apple, their ‘production theatre’ where they adopt open-kitchen concept in every store. Each is specially designed to showcase the process of donut making to build that multi-sensory experience for customers. For the first time, customers are able to fully appreciate their meal after having seen the donut make its journey from dough to packing box.
Big Apple donuts are enjoyed by many for a simple reason – a promise to our customers that every bite comes with absolute satisfaction. THE BIG APPLE PROMISE Big Apple donuts are enjoyed by many for a simple reason – a promise to their customers that every bite comes with absolute satisfaction. It is the guiding principles behind their corporate philosophy, of all that they do, in every Big Apple store, and with every Big Apple employee. This means our customer can take comfort in knowing that: 1)Big Apple donuts are easily available in major cities and towns. )Big Apple donuts can be enjoyed by all cultures. 3)Big Apple donuts are always served fresh, warm and fluffy soft. 4)The quality and taste of donuts are always consistent. 5)Big Apple thrives on innovation, consistently producing fresh ideas, new flavours and value promotion to benefit our customers. 6)Big Apple ingredients and products are imported and of the highest quality. 7)Operations and hygiene practices strictly adhere to international standard and procedure. 8)Big Apple donuts are made with low-sugar ingredients to keep calorie levels at the lowest possible. 4. CONCLUSION
Because they strive to be different, their donuts are not the same as other brands of donuts in the market. Altogether, the concept, packaging and the greater choices of donuts make Big Apple a very unique brand. With a tag-line “Every Piece is a Masterpiece”, Big Apple always aims to offer something new and exciting to all donut lovers in Malaysia and all around the world. From the time that it was conceived, Big Apple has upheld the commitment to deliver not only the promise of freshness and goodness but of innovation through foresight. And they continue to do so with each growing customer.
Cite this Business Analysis of Air Asia
Business Analysis of Air Asia. (2016, Oct 26). Retrieved from https://graduateway.com/air-asia-case/