This report discusses the strategic marketing aspect of Iceland Food Ltd, a popular British retailer, and explores productive marketing strategies for entering a new market with a new product.
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Strategic Marketing
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Executive Summary Marketing aspect is very important to any company or any business, because marketing give opportunity to promote a product or service at the large scale in the market. There are top-level management within most companies are putting their huge efforts for making their marketing stratgeies more effective. This report mainly has involved some productive marketing strategies which can support a company for gaining high profit within the new market.
INTRODUCTION Marketing is one of the major functions for a business or company, because this function gives opportunity toa business for promoting its products and services in the market at the large scale. In this dynamic and modern word, there are marketing aspect plays very excellent role for different companies or businesses. Top-level management within each company or business is highly required to make its marketing functions more and more effective, because currently only those organisations are gaining high profit who has very effective marketing functions. Basically, marketing team within each business is responsible to use same modern and productive strategies for making is marketing functions more effective. Day by day market competition within each industry or sector is increasing, that’s why existing management thin companies should develop some productive marketing strategies for gaining huge competitive advantage. This report mainly discusses strategy marketing aspect of Iceland food ltd. It is a popular British retailer, headquartered in Wales, United Kingdom. There are some major marketing strategies also has been discussed in this report which can support to Iceland food ltd. for entering the new market with new product. PESTLE ANALYSIS It is very important for organization to analyse the internal and external factors of the country and the market which the organization is expanding them into so that they can have a better functioning for themselves. This organization has a unique factor for them and this is going to get in more customers in the organization so that they can have high revenue for themselves. Netherland is a small country which is why the organization first expands them and understands and gain experience so that they can effectively expand themselves further globally. The new product which Iceland Food Limited is coming up with is mild ice cream which is going to be a great advantage for the company to get in more customers and increase the market share(Forzoni, Buffagni and Guercini, 2019). Political factors It is due to European Union trades there are a lot of political power change in the country which has to be considered by the organization so that they can have a better functioning for
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themselves. The taxations have been increased if the company wants to expand in United Kingdom but Expanding in Netherland is a good idea for the company because the factors are in favour of the organization. There is a disband which is visible in the coming years due to Brexit which has taken place which is why there is going to be a great advantage for unemployment in the country to reduce therefore the government of Netherland will also support the organization to expand themselves. The raw material will not have to be got from outside which is a great advantage for the company to expand themselves in this country. Economic factors The company is going to have a great advantage in getting in employees in the organization which are going to be cost friendly for Iceland Food Limited Company. Netherland is also having some of the highest incomes in the world which is a great factor for the company as well to get more customers resulting in higher profit margins(Reed, 2018). The economy in the country is liquid form which is why any company wanting to expand in this country is going to be very successful and have a strong portfolio for themselves. There were recessions in the country in 2008 and 2009 on which the country has worked upon and the country has developed a lot so that they can have a strong market for themselves. Social factors There are a lot of immigrations in the country because the country is open to take in people because that increases the business in the country and there are more than 10% immigrants in the country. The customers have to be given what they expect out of the organization and the trends and culture of the customers has to be followed by the companies which want to expand in this country. There are a lot of customers which are supporting fast food because they are being served in all the countries and because the customers do not get time to cook they prefer taking these products which is creates a great advantage for Iceland Food Ltd(Dogu and Albayrak, 2018). Technological factors Netherland has a strong connection in the world which is why getting in technological changes is not going to be difficult for Iceland food Ltd and is going to promote the organization as well in Netherland. There is a need for organizations to use technologies so that they can serve the best of products and services to the customers so that there is a better functioning. Social
media is also highly used in the country so promoting the product to the customers is also going to be very effective for the organization. Legal factors The taxation policies in 2017 were not followed by the organization but it is due to experience the company maintained their portfolio strong which is why the company has a great advantagetoexpandthemselves.Thepoliciesandlawswhichhavebeenmadebythe government for the employees are the customers are being followed effectively. There is a complete transparency within the organization so that there is a better functioning of the company which is a great advantage for the company. The laws and legal aspect has changed over years because of the change in power which is being followed by the company and updated to the employees as well about their rights. The safety and security of the employees is making the company has a strong base for themselves because the demands of the customers are being met on time. Environmental factors Netherland has been marked as a low country which is making the country very prone to flood risks in the country which is not a good factor for the company to expand themselves in the country(Mishra, 2018). The climate and the environment of the country have to be well maintained and the companies in the country also have to follow the rules of environmental factors effectively so that the risk can be reduced. Iceland Food Ltd is an experienced organization which is going to help the company have a better functioning for them and the organization will be able to expand them successfully. MARKET-ENTRY There are a lot of methods which are present in the organization through which the organization can expand themselves in other countries. This is a very essential factor because this is going to make the company grow and make more revenue so that the company can invest and increase their market share. The competitors in the market are increasing which is why it is very essential for the company to expand themselves and have a better functioning for them which is going to be getting the company a competitive advantage(Chandra, 2019). Iceland Food Ltd wants to expand them in Netherland which can make the company have a great
advantage for a long run in the market. Following are the options which the organization can use to enter market. Alliances It is very important for the organizations which are not having experience or not wanting to take high risks with their products to enter the market using this strategy. Getting in partnership with the local companies of the country can get in a lot of advantages and disadvantages for the organization. Advantage is that understanding the customers and their needs is easier for the companies but trusting the local people can be a risk for the company because they can capture the market for themselves as well. Mergers The decision making in this factor is lost control on when two companies come together for entry market. This is not an effective way of functioning because the company is not going to have a say for the company but everyone will who have taken a partnership in this factor (Adhikari, 2018). The culture of the organization is going to be disturbed and the productivity and demands of the company can also reduce which needs to be well maintained. Acquisitions This is going to require a lot of investment because the company will have to buy the maximum shares or all the shares of another company so that they can expand themselves. This is going to help the company be able to enter the market by locals which is going to make the company have a strong workforce and understand of the market which is a great factor for the organization when they have lack of experience. The results are going to show very quickly in th market. FDIs Foreign direct investment is going to make the companies which want to expand have al lot of risks for the growth in the market. There is not going to be better understanding of the customers and the company will have to invest a lot to promote themselves and then slowly understand the customers and improve according to them(Usman and Okafor, 2019). The company is not going to grow as fast as they expect and have to make a market all by themselves which is going to be time consuming and more investment.
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Recommendation It is because the organization is not having a lot of experience and is expanding in a small country, expanding by alliance in new market is going to be very effective for the organization. This is going to get in more experience and a local help to understand the market in which the organization is expanding into. The local market is already established and having to expand in this market the company will have to understand the expectations of the customers as well. Netherland have a high expectation from the companies and prefer local companies as well which is why the company can expand themselves with this mode in this country which is going to make the company get a lot of advantage for a long run. MARKET SEGMENTATION There are market segmentation and targeting are two major aspects of marketing which plays very excellent role while a company enter the new market segment. There STP model of marketing has used below. STP model is very helpful in analysing market segmentation, targeting and positioning (Christopher, 2016). Basically, these are three main stages of this STP model. Currently different businesses or companies are taking lots of advantages through STP model, because this model helps in divide whole market into small market segments. On the other side, model supports in targeting different customers also in the market. At the end, this model gives facility of product positing as well. That’s why top-level management of Iceland food ltd also should take huge advantages from this model. There are three stages of STP model has been discussed below; Segmentation Segmentation is the first stage within the STP model where marketing team if Iceland company sis responsible to divide its whole market into small market segments. For example; currently company has planned to enter the Netherlands with its new product called ‘milk ice cream’. In this situation, marketing team should divide whole food retail market of Netherlands into small markets segments. By taking this step, company can deeply understand the actual demand of customers within this country. The marketing team of company need to divide its whole market on the basis on geographical structure, demographical structure, culture, living
standard, ethnicity, interest level and attitude. This is really too important steps for the company, becausemarketsegmentationstageofSTPmodelgiveopportunitytoacompanyfor understanding accurate demand of existing market segments. For example; when marketing team divide its while market of Netherlands on the basis of people’s living standard, then it will be bale to provide its product to customers on the of basis their buying capacity. Suppose most people has higher living standards in one market segment of the Netherlands’, in which company can easily sell its new product within that market segment. On the other side, people have lower living standard within another market segment of Netherlands, in which Iceland food ltd (Ahmadi and O'Cass, 2016). will need to put some efforts for selling its milk ice cream product. That’s why segmentation stage will play very excellent for the Iceland food ltd. Targeting Targeting is the second stage within the STP model. In this stage, marketing team of company should take some productive steps towards targeting its customer on the basis segmentation results. Targeting stage give opportunity to a company saving its lots of time and money, because with the support of this stage company can directly offer its new product on those people who really wants to buy that product. In his stage, marketing team should target its customers on the basis of their income status, attitude, interest level etc. Mainly lots of people within the Netherlands really like to consume ice cream products, specially kids, teenagers and young, so this factor may help to Iceland food ltd for gaining very excellent results from this market segments. Currently many companies within marketing are using this targeting market strategy for effectively targeting lots of customers within the market. There are existing food retailers of Netherlands may give very tough competition to Iceland food ltd. but employing targeting stage of STP model, this company will achieve very effective results from the new market. Positioning Positioning is the last6 stage within the STP model, in which marketing team of Iceland food ltd highly need to consider this stage also with segmentation and targeting, because company can easily promote its new product in new market with the support of this strategy (Ketter, Mansfeld and Avraham, 2016). Basically, in this stage, marketing team of company is
responsible to make effective relations within people within new market. This step of marketing team will support to company for making its brand trustable in initials of that market. On the other side, marketing managers should use some modern and productive marketing strategies also for gaining very effective results from the Netherlands. These all marketing strategies will defiantly support to company for highly promoting its milk ice cream product in initials stage of Netherlands. The marketinbg manager should run informative and fancy advertisements within new market to attract lots of customers. For example; company can inform people about its good quality product in different advertisements. In this stage, top-level management of company should boost its distribution channel also for properly providing its new product within various market segments of the Netherlands. PORTER’S GENERIC STRATEGY Basically, there are four major strategies has involved in the Porter’s generic strategies which uses by many businesses in the market for gaining huge competitive advantages within their respective market segments. These stratgtegies mainly provides a speck framework to a company for systematically dealing within existing competitors. In this situation, Iceland food ltd also can take huge advantages from these stratgeies. These four porters’ generic stratgeies has been discussed below; Cost leadership strategy:Cost leadership strategy helps to a company for leading the market by cost wise. This strategy can support to Iceland food ltd also for attract lots of customer in the new market segments (Hair, Harrison and Risher, 2018). According to this strategy, a company should offer its milk ice-cream product on very low rate while entering the food market of Netherlands. On the other side, company should maintain excellent quality of product as well, because most customers always like to products and services from only those companies which provides products and services on low rates with excellent quality. Differentiationstrategy:Differentiationstrategyisalso veryproductiveingaininglarge customer base within the new market. According to this strategy, Iceland company should maintain some exclusiveness in its new milk ice-cream product while entering the Netherlands’ food retail market. With support of this strategy, the company will be able to gain huge
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competitive advantages within market. Reason, customers always like to buy some different and exclusive products. Cost focus strategy:Cost focus strategy is the next version of cost leadership strategy. According to this strategy, top-level management of company should use some productive cost managements techniques, like; competitive price technique, value-based price technique etc. These techniques can support to company for providing its product on the most favourable price in the new market (Sahni, Wheeler and Chintagunta, 2018). Top-level management should highly consider this strategy within its business operations of Netherlands. Differentiation focus strategy:There are differentiation focus strategy is the next version of differentiation strategy where company need use some highly productive strategies for maintain differentiation and exclusiveness within the product. For example; it can hire an effective research and development team which can support to company for developing an exclusive or different product. Critical Analysis In these stratgeies, top-level management of company should use cost leadership strategy, because this is one of the finest stratgeies within the porter’s generic strategies. By using cost leadership strategy, Iceland food ltd. will be able to gain huge competitive advantages within the market. Of course, other stratgeies are also very productive but they can’t give effective results in initial stage of new market as compare to cost leadership strategies. The company can use rest stratgeies when it will be systematically established in Netherlands within its new product (Boso and et.al., 2019). But in initial stage, the company should focus on only implementing this cost leadership strategy, because this strategy will support to Iceland food ltd. for providing customer friendly or favourable price of new product in the new market. CONCLUSION It can be concluded that there are various productive marketing strategies available which can support to Iceland food ltd. for systematically entering the new market called Netherlands. According to the STP model, there are most people within this new market like buy milk ice- cream, in which company should take advantages from this factor. On the other side, marketing
team of company needs to be more active in its existing job role for effectively promoting company’s new product within the new market. Iceland food ltd. is highly required to use cost leadership strategy, because this strategy will help to company for gaining huge competitive advantage in new market segment.
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