Marketing Report: Analysis of McLaren's Marketing Strategies

This report provides a comprehensive analysis of McLaren's marketing strategies, focusing on the application of marketing principles within the automotive industry. It begins with an overview of the marketing process, examining key elements such as environmental evaluation, target market identification, and the setting of marketing objectives. The report then delves into the micro and macro environmental factors influencing McLaren's decisions, including customer behavior, government regulations, and the competitive landscape, using tools like SWOT and PESTLE analyses. Furthermore, it explores segmentation criteria and target strategies, particularly for McLaren's new luxury car, and analyzes how buyer behavior impacts marketing activities. The report also examines product development strategies for sustaining competitive advantage, distribution arrangements, pricing strategies, and promotional activities, including the integration of the marketing mix elements. Finally, the report recommends a marketing mix for different segments, analyzes the differences between B2B and B2C marketing, and suggests strategies for entering the global market.

Marketing
Principles

Table of Contents
INTRODUCTION......................................................................................................................3
TASK 1......................................................................................................................................3
1.1 Explain various elements of marketing process...............................................................3
1.2 identifying the benefits and cost related to the marketing orientation.............................3
2.1 analyzing the micro and macro environment factors.......................................................4
2.2 And 2.3 proposing segmentation criteria and choosing a target strategy........................5
2.5 Positioning strategy for the new car of McLaren organization........................................5
2.4 How the buyer behaviour affects the marketing activities in different buying situation. 6
3.1 How product should be developed to sustain competitive advantage..............................6
3.2 How distribution is arranged to provide customer convenience......................................7
3.3 Pricing strategy according to the market conditions of the country.................................7
3.4 How promotional activity should be integrated to achieve the marketing objectives.....8
3.5 Analyze the additional elements of marketing mix..........................................................8
TASK 2......................................................................................................................................9
4.1 Recommend marketing mix for two different segments..................................................9
4.2 Marketing plan for the strategy and analyzing issue in using the marketing mix.
Explain differences between B2B and B2C...........................................................................9
4.3 Suggest implementing strategy for the abroad market. Difference between international
and domestic market............................................................................................................10
CONCLUSION........................................................................................................................10
REFERENCES.........................................................................................................................11

INTRODUCTION
Marketing principles have become important for every individual to follow in the
organization. The government has made these principles to safeguard the interest of the
human resource. This report emphasizes on marketing activities of the organization for
creating awareness among the individual. The organization which is taken in this report is
McLaren which is a car manufacturing firm. It stresses on the elements of the marketing
process which is very useful for the organization for making new product. Lastly it
emphasizes on the positioning strategy used for positioning the product in minds of
consumer.
TASK 1
1.1 Explain various elements of marketing process
Elements of process help in marketing the products of the company successfully. Like
in case of McLaren automobile company they emphasizes on the elements of marketing
process to achieve competitive advantage. The elements of marketing process are:
 Evaluating the environment- The Company uses different strategic tools for analyzing
and evaluating the environment in which McLaren is operating its business. It uses
SWOT, PESTEL and several other tools to investigate the market (Ceylan, 2008).
 Identifying the target market- Another element of the marketing process is to identify
the market which they will be going to serve. If the organization introduces new
product in the market then first it has to identify the target customer and make the
product according to it.
 Setting the marketing objectives- every organization has different marketing
objectives. Like in case of McLaren, the main market objective is to build a strong
luxury brand. According to the marketing objectives they can make marketing plans.
 Monitoring and evaluation- The last is evaluating the marketing strategy which is
used by the organization to achieve marketing objectives. In this, it evaluates the
strategies and analyzes the performance of strategy (Evans, 2010).
1.2 identifying the benefits and cost related to the marketing orientation
For McLaren, as the company is successful so it always does market orientation so
that requirements of the customer can be identified and the product can become successful in
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the competitive advantage. But there are several cost and benefits which has to be bear by the
organization.
 Products are made according to needs and requirements- the car which is
manufactured by the McLaren Company will be according to the needs and desires of
the customer. Even the gaps which were identified earlier were met in the car which is
developed by the organization (Martin, 2009).
 Products is tested many times- In case of market orientation, the organization tests the
car and this helps to know that as it is according to the needs of the customer. The
efficiency and the effectiveness of the product are tested.
 Plenty of resources are required- For doing marketing orientation, the McLaren
organization requires plenty of resources which include the workforce as well as the
other resources. If the organization possesses these resources then there will be no
problem. But if not, then it has to acquire the resource to plan market orientation
 Highly cost- The trend of the market changes frequently so to market orientation it is
highly costly. Because of the frequent changes McLaren has to do market orientation
till it reaches satisfactory results (Wise and Sirohi, 2005).
2.1 analyzing the micro and macro environment factors
Micro environment consist of employees, customer, government which affect the
decisions as well as marketing objectives of the company.
Micro environment
 Customers- According to their needs and demands, the car company manufactures its
car and even according to the trend it expand its area which helps in making high
profit. It is important to predict the desires of the user (Knight, 2003).
 Government- For the safety of the customer, customer has made certain laws for the
car company so that the accidents can be reduced. Even the government emphasizes
on the gadgets which are designed in the car for the betterment of the public.
 Employees- They are very important, so it is the responsibility of the McLaren
Company to safeguard their interest and give them comfortable environment.
Macro environment with the help of SWOT tool
 Strengths- McLaren’s strength is the brand name and the quality which is render
to its customers.
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 Weakness- it manufactures its car for only the high class people who market share
is very low.
 Opportunity- There are many areas in which it can expand its market as it has
good brand name in eyes of customer.
 Threat- There are competitive car manufactures that are competing in many
different areas and catering large number of mass (Knight, 2003).
PESTLE
 Political factor- This factor highly affects the production of the company. In
this case, the government has recently enforced the law of CO2 emission.
According to this, the McLaren has to make cars which reduce less CO2. The
company is member in EU, but it is possible that UK can stop the EU
membership.
 Economical- Further, political stability can lower down the spending of the
people. This will affect the sales of McLaren. High inflation rates affect the
sales of the company. Further, GDP fluctuations also impact the purchasing
power.
 Social factor- the cars are build according to the taste and preference of the
customers. As McLaren is the luxury company so it makes car which can be
afforded only by higher income groups. But the firm has to make
modifications according to the demand of the users. Further, the users are
more focused on saving the money, so it also affects the profitability of the
organization.
 Technological- the main emphasis of the high income group is on the
technology which the company is using in the cars. McLaren has to update the
car with the latest technology so that they can retain their customers.
 Legal factor- Company has to comply with all legal issues. Copyrights and
patents are one of the aspects which the company has to follow. The
organization has make patents regarding their innovation. They should update
their copyrights so that no organization claims on them.
 Environmental factor- Government has made some laws to save the
environment. So the McLaren has to made cars according to these laws.
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2.2 And 2.3 proposing segmentation criteria and choosing a target strategy
The car which is recently introduced by the McLaren is the luxury car the speed and
the power attached to it is very extreme. It is the requirement of youth. The car can be
categorized in luxury but it can comfortably run on mountains and rocky areas. The car is
made for two segments one is the geographical segment and another is the psychographic
segment. In case of geographical segment it focuses on that are which is rocky and the road
are not properly constructed. In case of the psychographic segment it has targeted the higher
income group as those are only the individual who can afford to buy the car. McLaren has
only expanded its market and has increased the market share (Torlak, 2011).
In case of the target strategy it has focused on the features of the car and its attributes
which is serving its two main customers. One is the youth or the middle aged people who
want luxury for status symbol and other is the youth who wants speed. The organization is
known for the quality so it has maintained this as the star feature and emphasized on the
feature. It is beneficial for it because no other competitors have introduced this type of car for
both the segments. It is the first organization who has introduced this car in the market. The
marketing source which McLaren has used to target the employees are through mails as well
as the advertisement in television. They have organized a press conference in which they
have launched the new car. From the conference only, it has gained the popularity and the car
launch was popular event for the country as well as the organization (Zou and Fu, 2011).
2.5 Positioning strategy for the new car of McLaren organization
The strategy which is used by the McLaren Company is the high price strategy. The
organization emphasizes on the price which it has quoted for its new car. The price which is
quoted is higher than the price of its competitors. The demographic segment in which it is
working is the individual who buy the car for the status symbol so for them they focus on the
price of the product. Besides this, it will stress on the feature of the product because the two
features which it has introduced is very unique. McLaren organization has focused on using
the technology and it wants to be the first mover in this field. So the positioning which has
created in the minds of the customer is of the unique. Further, high price product strategy is
useful because it is believed by the customer that the product which is having the high price
is of good quality as compare to other competitor’s product. This is also one of the reasons of
this firm to quote the high price. Product positioning is done on the basis of feature and the
price (Grant, 2010).
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2.4 How the buyer behaviour affects the marketing activities in different buying situation
The buyer behaviour changes according to the changes which are prevailing in the
market. According to these changes only, the firm has to carry out its marketing activities to
encourage the customer to buy the car of the company. The buyer behaviour is affected by
the situation which is prevailing in the market. In case of inflation, the purchasing power of
the customer goes down and they spend their money on the necessity goods and not on the
luxury goods. At that time, company do not promote its product as they know that the
customer will not purchase its product (Aguirregabiri and Ho, 2012). So they will not spend
on the marketing activity. But, in India at the time of festival most of the customer are keen
to buy the car so at that time the McLaren Company would promote its product as well as
will do marketing activities for creating awareness. Even, in London when the events like
Olympics are held then also they promote their product. At that time, the customer is mostly
the government officials and rich people who use the car for their status symbol. At that time
also the customers are keen to buy the product, so McLaren does heavy advertisements of
their product to promote the brand (Bruce and Daly, 2006).
3.1 How product should be developed to sustain competitive advantage
It is important for the company to develop new product to sustain competitive
advantage. For sustaining the competitive advantage it has to consider various strategies
which help them to make the car competitive. To make it competitive, the McLaren Company
can focus on the technology as they can use the technology which is not easily copied by
their competitive brand. If it will not be copied then, the car with this type of technology
would consider unique. So, the organization can develop its car on the basis of technology.
Even it is beneficial for the customer because most of them want to buy this car for status
symbol so they will be happy if the technology is not copied by other competitors. Further, to
sustain competitive advantage they can emphasize on the price. This will also create an
advantage for the company. The competitive advantage if used in other cars will help in
building the core competency of the firm. Then the McLaren organization will be known for
its technology which it uses in the car.
3.2 How distribution is arranged to provide customer convenience
To provide convenience to customer, the product should be easily available to
customer so that the customer does not suffer from any problem regarding the availability of
goods. Many of the companies have created competitive advantage on the distribution
channel which it uses to make the product available. In case of McLaren, the car is costly so
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the customer will not buy immediately as it will investigate the whole scenario regarding the
car which they are going to buy. McLaren has many stores in UK so it will provide the car in
that store only (Czinkota and Ronkainen, 2012). As the car is manufactured in industry so it
takes time to come in the stores. So for this, they have made a systematic process which
helps them to satisfy the needs f the buyer and the delivery is given on that time. In almost all
the cases, the customer book the car before hand and the time provided to them for the
delivery is less. So at this time, the company takes car from the factory and at the due date it
is delivered to the customer. So the inconvenience is not experienced by the customer in
buying the car. The distribution system of the car is ranked highest against many car
companies (Henley, Raffin and Caemmerer, 2011).
3.3 Pricing strategy according to the market conditions of the country
There are different pricing strategies which are introduced by the marketers to help
the company to fix the price of the product. Mostly the organization quotes the price
according to the marketing scenario and as per the strategy of its competitors. The price
strategy which is adopted by the McLaren firm is the premium pricing in which it will quote
the highest price for its car which will be introduced in the market. In this, the price fixed by
the organization will be higher than its competitors as it will compete on that basis. The car is
made for the rich segment so the product of the firm will fight with other cars on the basis of
price. Like in case of the necessity product, the company will quote high price because it is
required by everyone. But in case of luxury car the company has to quote according to the
feature and the target customer on which it is focusing. The car was made for the middle
income group and then will analyze the competitive strategy and then it would quote the
price. But because of McLaren Company’s new car feature it will use the premium pricing
strategy (McDonald and Wilson, 2011).
3.4 How promotional activity should be integrated to achieve the marketing objectives
Promotional activity should always be integrated with the marketing objectives as it
helps in achieving the objective successfully. Even it takes less time for the employees to
achieve the marketing objectives. According to the objectives of marketing, the company
should take the promotional step to promote its car among the customer. For example, the
marketing objective of McLaren is to create awareness among the target customer. The
company will choose those media which are used by high profile customer or the individual
who are techno savvy (Stern, 2006). So, McLaren is doing its promotion through social
media as it has made video regarding the features of the car and it shown on you tube. The
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main purpose of the company is to create awareness. It has given its advertisement on
television also put the organization knows that it is not for the middle income group people so
it is not stressing on that target market. The McLaren can define the marketing objectives and
then it can introduce the strategy for different objectives to achieve differently (Zou and Fu,
2011).
3.5 Analyze the additional elements of marketing mix
Marketing mix helps the company to identify as on which segment they should target
their customer. For the organization, there are many segments on the basis of which the
organization can target their customer and convince them to buy the car. Marketing mix is
based is carried out on the basis of the segment. But with the changing world there are two
more marketing mix which are introduced by the marketers they are:
 People- They are employees of the organization. McLaren has skilled employees who
use their knowledge to make the technology savvy product. The company has made
various policies for human resource for safeguarding their interest. Even the
environment in which they are working is also very good. So no problem arises in the
working of the company and even McLaren do not have any problem with the
employees (Grant, 2010).
 Process- the process which is used for manufacturing the car is also very effective as
because of this process, the cost of the car has became high because big machines are
used for manufacturing the cost. In case of handling queries they are very famous
because any of the problem arise they quickly solve the issue and the customer
becomes satisfied. The services provided before the purchase and after the purchase
both are remarkable (Bruce and Daly, 2006).
TASK 2
4.1 Recommend marketing mix for two different segments
The two different segments which the McLaren Company has targeted are the
geographical segment and the psychographic segment. The marketing mixes which can be
used for targeting two segments are the product and the price. For the geographical segment,
they can emphasize on product as the attribute which makes the firm different from its
competitors is the feature as it can ride on the rocky path. Even the company can modify the
product according to the requirement of the customer who desire this car. For the
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psychographic segment they can emphasize on price as they are not price sensitive so they
will buy the car without any kind of problem (Czinkota and Ronkainen, 2012). The price
skimming strategy will be used by the McLaren firm to set its price. According to this price
they will be attracted towards the car because it is expensive they will buy the car to show-
off. The demand of the car will not be affected widely as according to this feature the price
will be accepted by the youth. The best way to achieve the organizational goal is to use this
marketing mix for these segments (Bruce and Daly, 2006).
4.2 Marketing plan for the strategy and analyzing issue in using the marketing mix. Explain
differences between B2B and B2C
It is important for the McLaren organization to develop the marketing plan as this will
help in executing the strategy effectively. The first step is to analysing the market scenario
and the level of competition prevailing in the country. This will help to know the correct time
in which the company can execute the strategy. Another step is to identifying the resources
required to execute the plan. If there is lack of resources then the McLaren Company has to
gather to execute the plan. After the plan is executed, then it requires monitoring of the plan
which is implemented. Then finally corrective actions will be taken by the company (Stern,
2006).
The main difference in the B2B and B2C is that, customer buys the product for the
personnel use but in case of business, they will buy the care for business purpose. Even the
prices of the same product will differ from the B2B and B2C. In case of B2B, at many times
the price which is quoted will be less as compared to the customer (Evans, 2010).
4.3 Suggest implementing strategy for the abroad market. Difference between international
and domestic market
The marketing strategy which can be used by McLaren abroad is conducting seminar
and press conference regarding the introduction of the new product. This strategy will help in
creating awareness regarding the new car which is introduced by the company in the market.
The major target customer like the rich man can be invited in the event. In this event,
company will highlight features of the car which they will introduce in the market (Grant,
2010).
There is huge difference between international and domestic marketing. The
marketing expense required in international marketing is more than domestic marketing. The
number of target customer is also large in the international market than domestic one. The
sources mostly used to market the product domestically are newspapers etc. But in case of
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international market, social networking sites etc are used for marketing as their reach is vast
(Ceylan, 2008).
CONCLUSION
From this report it can be concluded that, the marketing strategy which McLaren has
adopted is very effective in creating awareness among the people. Even the car which is
introduced is technology savvy and in future it will create competitive advantage for the firm.
The price charged for the product is more because of the features in it. The positioning
strategy which is created in minds of the consumer is about the quality and the price which is
attached to the car.
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