The total budget for advertising/promotion was in 2003, Harvey and Burnham, the advertising agency was brought on board to help increase awareness of the company and bring in sales. Harvey and Burnham caused Scruffiest to realize that there was problem with distribution of additional funds for more advertising. There recommendation is one Cornfield’s president will have to think about Problem Scruffiest needs to change advertising strategy and tactics to increase sales and knowledge of the brand, without diminishing the quality of the brand that its current customers have known for years. Alternatives 1.
Follow the ad agency’s campaign and increase expenditures by 225,000 2. Do nothing to current advertising and promotion plan 3. Increase expenditures but not as much as recommended by the ad agency Recommendation To increase expenditures but not as much as recommended by the ad agency Analysis Since Scruffiest has been successful at creating awareness for their quality furniture it will be easy for them to continue this tradition with new customers. Cornfield’s success depends on their promotion, by increasing their advertising plan, they will not only ensure growth but essentially errant to retain current customers.
Although, simply increasing spending does not guarantee success in this industry. Scruffiest needs to change its marketing strategy to mirror something more in tune to the buying habits of consumers in 2004. The increased budget gives Scruffiest the opportunity to branch out into new areas of promotion. Scruffiest needs to increase its current budget by $1 65,000; this number is supported by the business department of the company, and its more realistic in the sense of being wise with finances. The biggest cause for concern Was Harvey and Burnham recommendations that me to be adding on to old tactics that Scruffiest already had.
Scruffiest needs a total change to its advertising and promotion; one that gets potential consumers at a time when they are in the mood to buy new furniture, and that is when they are buying a new house. The total increased budget should be used to form an alliance with a small to medium homebuilder such as Beaker Homes (South Eastern United States, including Florida). The majority of the money would be used as an initial buy in to a few communities that Beaker is building in along with some promotional flyers and logistical needed things that would be set up in each del house.
The sales people would be trained Beaker Homes sales reps, this would ensure the potential customer would have any questions answered when they went on a tour of a particular model. The business scheme would allow for the new furniture to be included on the customer’s new form of payment for the house (I. E. Mortgage). The statistics state that new furniture buying is 1% of disposable income, but if that could be taken out of the disposable income category and bundled with the purchase of the house itself, that would enable consumers to change their thought process from a disability issue to a necessity issue.
Beaker Homes would be compensated greatly for allowing us to do this, because they will be bringing in so many new customers. Scruffiest would also stand behind a money back guarantee; this will remove some of the anxiety associated with buying furniture. The current advertising campaign is a perfect fit for this new plan and need not be changed. Scruffiest needs to increase their budget to be successful in gaining new customers and enjoying continued success with current ones, such as baby boomers who are going to be spending more on furniture in the next years to mom.
