Niche Marketing Analysis: Naturally Cheeky's B2B and B2C Strategy

This report provides a comprehensive analysis of a niche marketing strategy for Naturally Cheeky, an apple cider vinegar manufacturer. The report begins with an introduction and outlines the objectives of marketing the product in both B2B (premium hotels) and B2C (athletes) segments. It then delves into the marketing environment, analyzing political, economic, and technological factors within Australia. The report examines the political stability, bilateral ties, and the impact of foreign companies on the market. Economic factors such as GDP, currency exchange rates, and the availability of resources are also discussed. The technological environment, environmental factors, and legal considerations are also analyzed. A competitor analysis identifies key players like Lirah, Coca-Cola, PepsiCo, and Nestle. The report then explores the readiness of the clients' market, mode of entry, and the STPD strategy, including segmentation, targeting, positioning, and differentiation. Finally, the report details the product, price, promotion, and distribution strategies for Naturally Cheeky, concluding with a summary of the recommendations for the company's international marketing strategy.

Running head: NICHE MARKETING IN B2B AND B2C
Niche Marketing of Naturally Cheeky
Name of the Student:
Name of the University:
Author Note:

1
NICHE MARKETING IN B2B AND B2C
Table of Contents
Introduction:....................................................................................................................................3
Objectives:.......................................................................................................................................3
Marketing environment summary:..................................................................................................3
Political environment:..................................................................................................................4
Economic environment:...............................................................................................................5
Technological environment:........................................................................................................8
Environmental factors:.................................................................................................................9
Legal factors:...............................................................................................................................9
Competitor analysis:........................................................................................................................9
Readiness of the clients’ market:...................................................................................................10
Mode of entry:...............................................................................................................................11
STPD strategy:...............................................................................................................................11
Segmentation:............................................................................................................................11
Targeting:...................................................................................................................................12
Positioning:................................................................................................................................12
Differentiation:..........................................................................................................................12
Product strategy:............................................................................................................................13
Price strategy:................................................................................................................................13
Promotion strategy:........................................................................................................................13

2
NICHE MARKETING IN B2B AND B2C
Distribution strategy:.....................................................................................................................14
Conclusion:....................................................................................................................................14
References:....................................................................................................................................16

3
NICHE MARKETING IN B2B AND B2C
Introduction:
The intense competition in the beverage market has made it crucial for the national level
beverage companies to seek new markets and expand even within Australia (Boerschinger,
Svitavsky and Yoder A., 2017). These companies require to make international standard
marketing strategy to counteract the competition which they face owing to entry of international
competitors from other countries. The paper would concentrate on formation of an international
level marketing strategy for Naturally Cheeky which an apple cider vinegar manufacturing and
marketing firm (naturallycheeky.com.au 2018). The study would first delve into the business
environment of the firm and then go on to explore its marketing strategies.
Objectives:
The objective of international market strategy is to market the apple cider vinegar
products by Naturally Cheeky in both business to business market (B2B) and business to
customer market (B2C). The Australian vinegar based drink marketing firm has its offices in
multiple places in Australia like Queensland, Palmerston, Coolalinga, Darwin and New South
Wales. The firm seeks to markets its vinegar products using niche marketing strategy both in the
B2B and B2C segments. The B2B segment would consist of premium five star hotels located in
Sydney and Melbourne. The end customer segment chosen for the B2C niche marketing strategy
consists of athletes. The marketing strategy would hold great significance for Naturally Cheeky
because the firm promotes its drinks as healthy alternatives to soft drinks. This means that the
company comes direct competition from beverage giants like Coca Cola and Pepsi Co.

4
NICHE MARKETING IN B2B AND B2C
Marketing environment summary:
The following section would deal with the environment which prevails in the market of
Australia is concerned:
Political environment:
The political environment in Australia is very stable which encourage spread of
companies. The government makes laws and policies which forms the base of the operations of
all the business firms operating in the country. The country has strong bilateral relationship with
countries like the United States, the United Kingdom, India, China and other emerging countries.
These political factors have significant impacts on the business operations of the companies
operating within Australia. For example, Australia and the United States of America share strong
bilateral relationship in the different fields like foreign policy, energy and trade
(usa.embassy.gov.au 2018). This strong relationship has led to the entry of American companies
into the Australian market. These American companies are competing with the Australian
companies. Coca Cola is competing with the beverage companies based in Australia for market
share and revenue. Moreover, these leading American beverage giants have listed themselves on
the Australian Stock Exchange which allow them to raise capital from the Australian securities
market (asx.com.au 2018). The Australian beverage firms like Naturally Cheeky are not public
limited companies and fail to withstand this competition. Thus, the political stability and bilateral
ties of Australia have led to entry of foreign companies making the market of Australian more
competitive.
An analysis of the impact of the political factors of the Australian market would point
that the bilateral ties present several business opportunities for the Australian firms. Australia has
strong ties with Asian countries like China (aph.gov.au 2018). China is emerging into a global

5
NICHE MARKETING IN B2B AND B2C
giant and Australian companies are eyeing China as a profitable. Similarly, India also presents a
profitable market for the Australian companies (mea.gov.in 2018). Both these Asian countries
have hige customer base which would provide the Australian companies the opportunity to
diversify the loss of revenue they incur due to competition from American companies. However,
the complex relationship which China shares with India and the US, its dwindling political
stability and arms race in East Asia have negative impact on the business of the Australian
companies seeking to enter the markets (aph.gov.au 2018). The political factors like political
problems in Australia like national energy policy have deep impacts on the operations of all the
firms including Naturally Cheeky (smh.com.au 2018). Terrorism and extortion of firms for
money by terror groups remains to be a perpetual political threat looming over the business
market environment in Australia (news.com.au 2018).
Economic environment:
The economic environmental factors of Australia impacting beverage companies like
Naturally Cheeky would be increasing per capita income of the country, its high quality supply
chains and the market opportunities are the outcomes of its bilateral political connections. As far
as beverage industry is concerned, its productivity is dependent on the availability of fresh
agricultural products like fruits. Another important economic factor which determines the
production of beverage is availability of water resources (Valta et al. 2016). The availability of
labour plays an important role in the productivity of the beverage industry. The main raw
materials of the beverage industry consist of fruits and nature identical ingredients which are
perishable in nature. The finished products, the apple cider vinegar in different flavours are also
perishable in nature. This makes it clear that the productivity and the revenue generation of the
beverage industry is dependent on the availability of logistics and warehouse facilities. The

6
NICHE MARKETING IN B2B AND B2C
market of Australia provides an excellent network of modern warehouse and logistics which
enable the beverage companies store and transport their products to distant places
(prnewswire.com 2018). The next economic factor which promotes the business of firms like
Naturally Cheeky is availability of easy finance in Australia. The country has a wide network of
banks and non-banking financial institutions which provides the firms with ready financial help
like loan facilities. This factor help firms in Australia run their immense business operations
spread all over Australia and abroad.
Figure 1. Graph showing 10 per GDP in Australia
(Source: tradingeconomics.com 2018)
The graph above shows that GDP of Australia over is showing a downward trend. This
means that the income of the Australian consumers are falling. The outcome of this fall of GDP

7
NICHE MARKETING IN B2B AND B2C
would be lower amount of disposable income in the hands of the Australian consumers to afford
services at the premium hotels which form a main B2B customers of the beverage companies.
This analysis clearly shows that along with dwindling GDP and entry of foreign beverage
companies, the Australian beverage companies are under intense economic threats.
The next important economic factor which impacts with business operations of the
beverage companies like Naturally Cheeky is international currency exchange rate. This is
because online payment system which the companies use to make and receive payments,
especially from business organisations are owned by American companies like Amazon. The
graph below show the weakening position of AUD against USD. This means that Australian
beverage companies require to obtain services like hiring of ecommerce portals from American
companies at higher rates which would increase their expenditure.
Figure 2, Graph showing AUD:USD conversion rate on 5 years

8
NICHE MARKETING IN B2B AND B2C
(Source: bloomberg.com 2018)
The Australian beverage companies can take advantage of the political ties of the
government and expand into the neighbouring markets. This would enable them to diversify the
losses they incur due to increase in expenditure and loss of revenue due to stronger competitors
(Asongu 2016).
Technological environment:
The economic and political stability of Australia has earned it a strong technological
environment which in the end benefits the business organisations. The firms like Naturally
Cheeky manufacture apple cider vinegar and mix them with fruits. This requires high order food
technology to maintain appropriate colour, flavour and quality of the products.
The next area where technological factors play significant role is in the supply chain
management. The advanced information and communication technology which Australia offers
enables the business organisations communicate with a suppliers of raw materials spread all over
the world. This enables them to obtain high quality raw materials at economic rates, which in
turn enable them to keep their cost of production low. The technologically advanced market of
Australia provides opportunities to business organisations to bring about innovation in their
products.
The business organisations of Australia use technology to operate and maintain a strong
communication within the companies and with external parties. The business organisations use
their strong communication channel to coordinate business operations among their various
geographically dispersed locations. The use technology to promote their goods and services as
well. They communicate with their customers using the social media platforms which enable

9
NICHE MARKETING IN B2B AND B2C
them to inform the latter about their future strategies. Thus, technology enables business
organisations to operate more efficiently in the market.
Environmental factors:
The business organisations operating in Australia come under several environmental
factors. For example, the Environment Protection and Biodiversity Conservation Act 1999 or
EPBC Act necessitates all business organisations operate in environment friendly ways so as to
minimise pollution in the country. The law clearly mentions that failure to comply with it would
attract legal actions and penalties against the organisations concerned (environment.gov.au
2018). The customers today also prefer to obtain products from companies which operate in
environment friendly ways. This societal influence has resulted in business organisations acquire
green supply chains to acquire more environment friendly raw materials. This business
organisations today operate as responsible corporate citizens which operate in environment
friendly ways to reduce the pollution level to the extent possible.
Legal factors:
The business organisations today have to comply with several laws while operating in the
market of Australia. They have to comply with various laws and regulations which is power
within Australia. The business organisations have to follows laws like income tax laws which
apply to all the industries. Similarly the business organisations have to comply with laws
pertaining to the industries they belong to. For example, Naturally Cheeky manufactures apple
cider vinegar in fusion with different flavours. This necessitates the firm to comply with the food
safety standards which are in operation in Australia (foodstandards.gov 2018). The business
organisations operating in Australia have to comply with Safe Work Act 1999
(safework.nsw.gov.au 2018).

10
NICHE MARKETING IN B2B AND B2C
Competitor analysis:
A competitor analysis of Naturally Cheeky shows that the firm receives strong
competition from other manufacturers of apple cider vinegar like Lirah which is based in
Stanthorpe, Queensaland, Australia (lirah.com.au 2018). The availability of technology and a
strong wine industry has led to the growth of vinegar industry in the country. The premium
vinegar making companies manufacture and market thousands of vinegar within Australia. The
vinegar manufacturers like Lirah employ high level food technology and specialists to
manufacture premium quality vinegar which they export to foreign markets as well. These
manufacturers compete with Naturally Cheeky for market position (abc.net.au 2018).
The next group of competitors of Naturally Cheeky consist of the carbonated beverage
manufacturing companies. This is because the apple cider manufacturers promote their products
as ‘healthy’ alternatives to carbonated soft drinks. This brings them under direct competition
from the leading carbonated beverage manufacturers like Coca Cola and Pepsi Co (pepsico.com
2018). The manufacturers of tea and coffee based products like Nestle also compete with apple
cider vinegar manufacturers like Naturally Cheeky (nestle.com.au 2018).
An analysis of the competitors of Naturally Cheeky would show that the firm faces stiff
competition in Australia. One can also point out that the competitors like Pepsi Co and Nestle are
stronger compared to it. The company needs to promote its goods aggressively in order to
succeed in sustaining in the Australian beverage market.
Readiness of the clients’ market:
Naturally Cheeky finds ready acceptance in the Australian market both in the business to
business segment and business to customer segments. The firm uses niche marketing strategy to

11
NICHE MARKETING IN B2B AND B2C
sustain and expand in the highly competitive Australian beverage market. The business to
business market of the firm consist of premium hotels in Sydney and Melbourne. The business to
customer segment consists of health conscious athletes (Ashraf et al. 2017). These firm uses
appropriate marketing mix to gain acceptance among these two customer segments. This is
evident by the presence of the firm in multiple locations in Australia like Ballina, Byron Bay,
Darwin and Humpty Queensland. The products by the firm are available in top retail chains like
Coles which once again substantiates its strong market presence (Li and Lin 2015).
Mode of entry:
Naturally Cheeky uses niche marketing as the mode of entry to enter and sustain in the
competitive beverage market of Australia. The firm in order to gain strategic in the markets of
Australia and access to its target customers, makes its products available in cafes, organic stores,
pharmaceutical stores and health clubs. The firm uses the franchisee and retailer mode to
distribute its products among these retailers.
STPD strategy:
The STPD strategy of Naturally Cheeky consist if segmentation, targeting, positioning
and differentiation to gain higher competitive position in the market. The following section
would unearth the STPD strategy of Naturally Cheeky:
Segmentation:
Naturally Cheeky segments its markets geographically into New South Wales,
Queensland and Northern Territory. The firm makes its products available in cafes, gymnasiums
and pharmaceutical stores. The firms segments its market psychographically and target health
conscious people like athletes. The athletes taking part in different sports usually avoid soft

12
NICHE MARKETING IN B2B AND B2C
drinks due to high sugar content. According the manufacturers of apple cider vinegar drinks like
Naturally Cheeky, the athletes can opt for their products owing to the health benefits and
refreshing flavours in which these products come (theconversation.com 2018). The next
segmentation strategy which Naturally Cheeky uses consists of economic segmentation. The
products of the company are of high quality and are expensive. The high price of the products by
Naturally Cheeky act as quality assurance for the consumers (Eckel et al. 2015). The presence of
products in the premium hotels of Sydney and Melbourne once again bears testimony of its
aggressive segmentation strategy.
Targeting:
The targeting strategy of Naturally Cheeky as pointed out would concentrate on two
niche customer segments in B2B and B2C segment. The B2B segment would consist of premium
hotels located in Sydney and Melbourne. The firm offers its apple cider vinegar products in
flavbours like strawberry and minty blonde which finds acceptance among the middle-class and
upper class customers who visit these hotels. This leads to large demand for its products in these
high profile hotels. An analysis of the targeting strategy of Naturally Cheeky shows that the
firm’s B2B and B2C targeting strategy are actually interdependent.
Positioning:
Naturally Cheeky positions its products as high quality and healthy premium products in
the market. The firm through its official website clearly mention the organic and environment
friendly origin of its products. The website also mentions that apple cider vinegar is good for
health. These facts allow the company to establish its products as a healthy products which can
even be consumed by athletes.

13
NICHE MARKETING IN B2B AND B2C
Differentiation:
The differentiation strategy of Naturally Cheeky consists of the availability of its
products in diverse flavours like mint and strawberry. The firm in order to differentiate its
products from its competitors make them available in various locations like gymnasiums and
cafes.
Product strategy:
The product strategy of Naturally Cheeky consist of two parts the intangible component
and the tangible component. The products of the firm consists of apple cider vinegar in flavours
like cheeky pair, ginger red, minty blonde, spice blonde, troppo blonde and seasonal range. The
intangible products of the firm consist of suggestions on serving its products to make them more
enjoyable to consumers. Naturally Cheeky offers its healthy products at various cafes and
gymnasiums which are frequented by its niche customers, the athletes. As far as the business
customers are concerned, the firm offers distributorship of its products. The business customers
can contact it on its official website.
Price strategy:
The pricing strategy which Naturally Cheeky adopts helps it to attract its two customer
segments, the premium hotels as far as B2B is concerned and the athletes in case of B2C. The
premium hotels of Sydney and Melbourne are visited by upper class people. Australia receives
immense number of foreign tourists who put up in these premium hotels (tra.gov.au 2018). Thus,
appropriate pricing strategy acts as a sign of premium quality of Naturally Cheeky products
which make attractive to the upper class customers of the hotels. The athletes too consider the
high price of Naturally Cheeky products as an assurance for quality and consume them.

14
NICHE MARKETING IN B2B AND B2C
Promotion strategy:
Naturally Cheeky promotes its products on its official websites to both B2B and B2C
customers. The customers can gain information about the products of the company on its official
website and about their availability. The firm also promotes its products on social media
platforms like Istagram and Facebook. The official website as pointed out also help the firm to
promote its products among the distributors as well. This strong promotional strategy enables
Naturally Cheeky attract a large business and individual customers, thus earning it immense
revenue (Govindan, Paam and Abtahi 2016).
Distribution strategy:
The distribution strategy of Naturally Cheeky enables it to earn immense revenue. The
firm is present in several locations like NSW and Queensland. This enables the firm
communicate with the local distribution chains of retailers and wholesalers to distribute its
products. Moreover, its distribution chains also includes supermarkets, cafes and gymnasiums
frequented by upper class people. This intricate distribution network enable the firm to distribute
its products among immense consumer base to earn huge revenue. The firm is in fact spreading
its distribution channel in new Australian markets to earn more revenue (Afshari, et al. 2014).
Conclusion:
The above discussion bring into the light several salient aspects of the marketing
environment and strategies of Naturally Cheeky. First, the business environment of the firm is
extremely competitive and demands strong marketing strategies to sustain in it. Secondly, the
firm offers apple cider vinegar which it promotes as healthy alternative to aerated soft drinks.
Thirdly, this brings the company into direct collision with giants like Pepsi Co and fourthly, the

15
NICHE MARKETING IN B2B AND B2C
company cannot withstand the competition from these gaints. The following recommendations
can be made in the light of the conclusion to the management of Naturally Cheeky:
1. The firm must become a public limited company which would allow it to acquire capital
from the stock market of Australia. This would provide it with the strong capital base that
it require to compete with competitors like Coca Cola Company which are multinational
public limited companies.
2. The company must expand its present product line into new products like organic fruit
drink ranges not based on vinegar. This would enable it to attract new customer base and
maximise its revenue generation.

16
NICHE MARKETING IN B2B AND B2C
References:
Afshari, H., Sharafi, M., ElMekkawy, T. and Peng, Q., 2014. Optimizing multi-objective
dynamic facility location decisions within green distribution network design.
Aph.gov.au. 2018. Australia's Relations with China: What's the Problem? – Parliament of
Australia. [online] Available at:
https://www.aph.gov.au/sitecore/content/Home/About_Parliament/Parliamentary_Departments/
Parliamentary_Library/Publications_Archive/CIB/CIB9697/97cib23 [Accessed 22 May 2018].
Ashraf, A.R., Thongpapanl, N., Menguc, B. and Northey, G., 2017. The role of m-commerce
readiness in emerging and developed markets. Journal of International Marketing, 25(2), pp.25-
51.
Asongu, S., 2016. Reinventing foreign aid for inclusive and sustainable development: Kuznets,
Piketty and the great policy reversal. Journal of Economic Surveys, 30(4), pp.736-755.
Asx.com.au. 2018. CCL. [online] Available at: https://www.asx.com.au/asx/share-price-
research/company/CCL [Accessed 22 May 2018].
Bloomberg.com. 2018. AUD to USD Exchange Rate. [online] Available at:
https://www.bloomberg.com/quote/AUDUSD:CUR [Accessed 22 May 2018].
Boerschinger, O., Svitavsky, K. and Yoder, A., 2017. Encouraging Small Business Growth and
Expansion: Ramsey COR Retail Market Analysis.

17
NICHE MARKETING IN B2B AND B2C
Department of the Environment and Energy. 2018. Department of the Environment and Energy.
[online] Available at: http://www.environment.gov.au/resource/local-government-and-australian-
environment-law [Accessed 23 May 2018].
Eckel, C., Iacovone, L., Javorcik, B. and Neary, J.P., 2015. Multi-product firms at home and
away: Cost-versus quality-based competence. Journal of International Economics, 95(2),
pp.216-232.
Foodstandards.gov.au. 2018. Food safety standards (Australia only). [online] Available at:
http://www.foodstandards.gov.au/industry/safetystandards/Pages/default.aspx [Accessed 23 May
2018].
Govindan, K., Paam, P. and Abtahi, A.R., 2016. A fuzzy multi-objective optimization model for
sustainable reverse logistics network design. Ecological indicators, 67, pp.753-768.
Gunders, J. 2018. More than wine-gone-bad, vinegar hits high note with consumers. [online]
ABC Rural. Available at: http://www.abc.net.au/news/rural/2016-09-15/new-vinegar-plant-
producing-thousands-of-litres-a-day/7835826 [Accessed 23 May 2018].
http://www.nestle.com.au. 2018. Home. [online] Available at: https://www.nestle.com.au/
[Accessed 23 May 2018].
Li, C.R. and Lin, C.J., 2015. New product adoption and sales performance from the importer
perspective. Industrial Marketing Management, 44, pp.98-106.
Lirah.com.au. 2018. Lirah. [online] Available at: http://www.lirah.com.au/contact-us.aspx
[Accessed 23 May 2018].

18
NICHE MARKETING IN B2B AND B2C
Mea.gov.in. 2018. India-Australia Bilateral Relations. [online] Available at:
https://www.mea.gov.in/Portal/ForeignRelation/Australia_05_09_2017.pdf [Accessed 22 May
2018].
NATURALLY CHEEKY. (2018). The Range - NATURALLY CHEEKY. [online] Available at:
http://naturallycheeky.com.au/the-range/ [Accessed 23 May 2018].
NewsComAu. 2018. Terror attack plots for Australia that were foiled moments before they were
executed. [online] Available at: http://www.news.com.au/national/crime/the-11-imminent-terror-
attacks-australia-narrowly-escaped/news-story/86fc734df0963e21fe038c0eecce7d80 [Accessed
22 May 2018].
Pepsico.com. 2018. The Search for Hidden Figures. [online] Available at:
http://www.pepsico.com/ [Accessed 23 May 2018].
Research, K. 2018. Australia Logistics and Warehousing Market is Expected to Reach AUD 187
Billion by 2021: Ken Research. [online] Prnewswire.com. Available at:
https://www.prnewswire.com/news-releases/australia-logistics-and-warehousing-market-is-
expected-to-reach-aud-187-billion-by-2021-ken-research-649364933.html [Accessed 22 May
2018].
SafeWork NSW. 2018. Home. [online] Available at: http://www.safework.nsw.gov.au/
[Accessed 23 May 2018].
The Conversation. 2018. Sports drinks help athletic performance and nothing else. [online]
Available at: https://theconversation.com/sports-drinks-help-athletic-performance-and-nothing-
else-32041 [Accessed 23 May 2018].

19
NICHE MARKETING IN B2B AND B2C
Tra.gov.au. 2018. International tourism statistics | Tourism Research Australia. [online]
Available at: https://www.tra.gov.au/research/international-visitors-to-australia/international-
tourism-statistics/international-tourism-statistics [Accessed 23 May 2018].
Tradingeconomics.com. 2018. Australia GDP Growth Rate | 1959-2018 | Data | Chart |
Calendar | Forecast. [online] Available at: https://tradingeconomics.com/australia/gdp-growth
[Accessed 22 May 2018].
Usa.embassy.gov.au. 2018. Australia and the United States relations | Australia in the USA.
[online] Available at: https://usa.embassy.gov.au/australia-and-us-relations [Accessed 22 May
2018].
Valta, K., Moustakas, K., Sotiropoulos, A., Malamis, D. and Haralambous, K.J., 2016.
Adaptation measures for the food and beverage industry to the impact of climate change on
water availability. Desalination and Water Treatment, 57(5), pp.2336-2343.
Warhurst, J. 2018. The nine political issues that sum up 2017. [online] The Sydney Morning
Herald. Available at: https://www.smh.com.au/opinion/the-nine-political-issues-that-sum-up-
2017-20171213-h03pe9.html [Accessed 22 May 2018].