Researching the marketing environment

DEVELOPING YOUR MARKETING PLAN

Every marketing plan begins with a review of the external trends and changes that affect the company, product, customers, buying trends and competition.

To get a headstart on researching the marketing environment, try clicking on the links shown on my Marketing planning links page. Every link is regularly tested and updated as needed--plus new links are added as well.

Links are categorised according to:

• Preparing for marketing planning
• Analysing the marketing environment
• Researching consumer and business demographics
• Marketing ethics, social responsibility and sustainability
• Branding issues and ideas
• Marketing issues and ideas
• Marketing control and implementation
• Retailing and channel trends

For a broad overview of the marketing plan, including a free downloadable template, click here.

Ryanair's 30 years of low fares

Every airline has its competitive point of differentiation. Ryanair's is low price, full stop, which is why the carrier--in its 30th year--already flies more passengers than any other European airline.

Despite reducing prices, Ryanair's revenue and profits are flying high. Lower fuel prices are helping. Also, the airline has been improving some services and putting pricing pressure on rivals. If anyone can spark a price war, it's Ryanair.

Meanwhile, Ryanair chief exec Michael O'Leary dislikes the airfare pricing comparison sites and, in fact, has contacted his competitors to ask them to feature multiple airlines' prices on their individual sites. He says: 'I think it is something the big airlines could and should work together on because I think it makes no sense for third-party price comparison websites out there'.

Ryanair has more than 170,000 Twitter followers and an active YouTube and Instagram account. It also has a busy Facebook page. To celebrate its 30th birthday, Ryanair is running a promotion with the hashtag #30Names30Planes that is attracting social media attention.

Apple Pay adds momentum to mobile payment

Apple shows Apple Pay on its devices

Apple Pay recently launched in the UK market, with multiple banks supporting the contactless mobile payment app (meaning tap the phone or click or both to initiate payment).

Users 'store' their credit and debit card details within the app so they can quickly and conveniently pay for tickets, food, merchandise and more.

Among the first banks to offer Apple Pay are NatWest, Royal Bank of Scotland, Nationwide, MBNA, Santander and Ulster Bank. American Express is also participating.

Visa Europe's research indicates a high percentage of UK customers own smartphones, the key element in mobile payments, and it predicts this method 'will fast become a preferred way to store and use a credit or debit card'. However, some consumers are wary of tech-fueled payments (due to security concerns or unfamiliarity). Another issue, being worked on, is the upper limit of how much Apple Pay users can buy with the app. 

With Apple Pay in full launch mode, mobile payment is sure to attract new users among key demographic groups (Millennials, particularly) and accelerate acceptance during 2015 and beyond.

Superior service reinforces customer loyalty at Ritz-Carlton

The world-famous Ritz-Carlton hotels are known for personalised service. The general manager of the Ritz-Carlton in Toronto screens prospective employees with the goal of hiring and training those who are enthusiastic about providing superior customer service. He says the key question his employees must ask themselves is: 'How can I make things more hassle-free for the guest?' Read more about the Ritz-Carlton's Gold Standards here.

The hotel company created the acronym MR BIV to focus employees on avoiding and correcting service slipups:

Mistakes
Rework
Breakdowns
Inefficiencies
Variation in work processes


According to a J.D. Power survey, hotel guest satisfaction in North America is at an all-time high--which means hotels must work even harder to stand out.

Especially in this digital age, when customers can research hotels and share experiences in an instant, the president of Ritz-Carlton has this to say about the secret to superior customer service:

'Customers today have an expectation of seamless service, in part because of the online experience and other technological factors. It’s important that we provide them with this seamless service– all of the element of the luxury hotel experience must integrate and flow together, from the planning process when they make the reservation, to when they depart the hotel'.

To encourage repeat visits and keep loyal hotel guests informed about new locations and services, the Ritz-Carlton publishes a full-colour online magazine filled with travel possibilities and tips. The corporate FB page has more than 550,000 likes and its Twitter account has attracted nearly 150,000 followers. The hotel is especially active on Pinterest, where its pins are spread across 123 boards with titles such as 'Discover the world' and 'I do.'

Will Amazon Prime Day become Black Friday in July?

Amazon.com is celebrating its two-decade birthday on 15 July by launching a special online sale exclusively for members of its annual fee-based Prime programme. Prime members are entitled to free two-day shipping, access to unlimited TV and movie viewing from Amazon's entertainment library, access to a library of thousands of Kindle-based books and early notice of special merchandise, among other privileges.

Prime Day is being promoted with the strapline 'more deals than Black Friday', referring to the big shopping day on the Friday after US Thanksgiving Thursday. Consumers are growing accustomed to doing much of their shopping for Christmas and Hanukkah on Black Friday, thanks to retail deals that attract attention.

Amazon's Prime service has been highly successful in the US market, encouraging shopper loyalty and retention. In the UK, Amazon is adding extras such as one-hour delivery in London for a small extra fee.

Will Prime Day become the summer version of Black Friday? Other retailers that sell online may get a boost from shoppers comparing the Prime Day specials, say experts. Already, Black Friday is an increasingly popular shopping day for UK retailers, and Amazon's July version could very well shape consumer behaviour this year and beyond.

World's most popular theme parks

According to a new study, the 25 most popular theme parks on the planet attracted 223 million people in 2014. The Magic Kingdom at Disney World (Florida) is the world's most popular theme park, ranked by attendance, followed by Tokyo Disneyland, Disneyland California, Tokyo DisneySea Japan, Universal Studios Japan, Epcot in Disney World (Florida), Animal Kingdom in Disney World (Florida), Disney Hollywood Studios (Florida), Disneyland Paris, and Disney's California Adventure Park.

In other words, of the 10 most popular theme parks around the world, only one is not a Disney destination. And to put the attendance numbers into perspective, the #1 theme park (Disney's Magic Kingdom in Florida) drew nearly 20 million visitors on its own.

Also, of the top 10 parks, three are located in Japan. Localising the attractions is a good way to increase appeal and differentiate the park experience. With summer holidays on the way, Universal Studios Japan is marketing its new zombie and 'yokai' monster attractions, based on well-known amine, video game and movie characters.

China is a fast-growing market for theme parks, as well. Hong Kong Disneyland has been open for a decade, and other major attractions are being built throughout the country. A new Hello Kitty park recently celebrated its grand opening. Perhaps the strangest theme-park attraction anywhere is in the Window of the World theme park: A 'death simulator' where visitors climb into a coffin, are 'cremated' and then reborn--an interesting application of consumer behaviour research.

Pricing by the Page

Amazon is again a price innovator. This time, Amazon is going to pay authors according to how many pages are read by customers who 'borrow' e-books from the Kindle 'library'.

Here's how Amazon explained it to authors (italics added for emphasis):

Beginning July 1, 2015, we'll switch from paying Kindle Unlimited (KU) and Kindle Owners' Lending Library (KOLL) royalties based on qualified borrows, to paying based on the number of pages read. We're making this switch in response to great feedback we received from authors who asked us to better align payout with the length of books and how much customers read. Under the new payment method, you'll be paid for each page individual customers read of your book, the first time they read it. 

Media coverage of the new pricing mentions how it could influence authors to write page-turners to encourage readers to read quickly so Amazon will pay quickly. Or influence authors to write longer books to get paid more as readers read. Canadian Business notes that this pricing policy is a way to objectively assess the value of an e-book to readers, and pay authors according to that value.

Although some authors worry that they will see lower payments, others believe that the new pricing will lead to higher quality. However, books by best-selling authors are generally not part of Amazon's Kindle library and therefore not subject to this new pricing. So pricing by the page is mainly an innovation applied to e-books by indie authors, at least for now.

Overall, pricing of books has gotten increasingly complex over time. Buyers can purchase a printed or electronic book, or 'borrow' from the library (at one low subscription price per year) or 'hire' a textbook for a specific period. Not surprisingly, the complexities can be confusing to both readers and authors. Will pricing by the page establish itself as a long-term policy?

Competitive changes in the UK chocolate market

The UK market for chocolates is increasingly split between mass-market brands such as Cadbury Dairy Milk and upmarket brands such as Hotel Chocolat.

In fact, Hotel Chocolat's founder says: 'It's an emotionally charged food product that people are buying for the taste and the way it makes them feel'. With a decade of experience in marketing the emotional and taste benefits of luxury chocolates, Hotel Chocolat has established a distinctive brand image and built considerable brand equity.

On the mass-market side, Cadbury Dairy Milk (owned by Mondelez) continues to top the list of leading UK chocolate brands, with year-over-year growth. Mars and Nestle both have chocolate-bar brands in the top 10--and private-brand chocolates are also among the top sellers.

However, the competitive situation is about to change. Thorntons has been struggling for some time, caught between the upmarket brands and the mass-market brands. Now Ferrero has acquired it, which may lead to a new marketing strategy, not to mention a new positioning for the products and the retail shops. This will cause all the aspirational brands to work harder to connect with customers and reinforce loyalty.

So the hypothethical marketing plan for Lost Legends Luxury Chocolatier (which is included in my Essential Guide to Marketing Planning textbook) must be updated to reflect these important market changes.

England's new cigarette marketing rules

From May 2016, the familiar brand colours and logos will no longer appear on packs of Marlboro and every other well-known brand of cigarettes sold in England. Instead, all cigarettes will be sold in standardised, 'plain' packaging, complete with easy-to-read health warnings. The new rules, years in the making, are designed to discourage children from smoking.

Brands are battling back by preparing legal action to force the UK government to compensate them for the loss of value of intellectual property, namely the considerable financial value of their instantly-recognised brands. 'We respect the government’s authority to regulate in the public interest, but wiping out trademarks simply goes too far', according to Philip Morris International’s senior vice president and general counsel.

Electronic cigarette marketing must adhere to different government standards. For instance, e-cigarettes can now be advertised on television if not associated with youth culture or set to appeal to under-age buyers. Grocery retailers are seeing large increases in e-cig purchasing, in fact.

Tesco reduces its global retail reach

Tesco's Homeplus retail business in South Korea serves 6 million customers weekly. This thriving retail empire has annual turnover of £4.1 billion and has been a leader in virtual retailing for several years.

Now, after the failure of the Fresh & Easy expansion in the US and a challenging accounting scandal, Tesco is exploring the sale of the Homeplus unit to reduce corporate debt and refocus on its other business interests. Private equity firms are preparing to bid, and the Hyundai Department Store group may bid, as well.

Despite this reduction in global retail reach, Tesco's retailing strategy still includes non-UK operations in India, Malaysia, Czech Republic, Hungary, Ireland, Poland, Slovakia, China and Turkey. It also offers financial services and marketing research services.

What does the Tesco brand stand for? The corporate site explains:

Today, our brand must be about more than simply function. It’s about the way we work, the values we live by, the legacy we leave. We can’t solve the world’s problems but we want Tesco to always do the right thing, to inspire and to earn trust and loyalty from all of our stakeholders.