PRODUCT STRATEGIES 

Question: We manufacture consumer products. The sales revenue of a product has reached the decline stage of the product life cycle (PLC). Should we withdraw it from the marketplace? 

Answer: Before we proceed with the market strategies, consider these factors: 1. To avoid disruption of the workflow in the production process, do you have a new product to replace the current one? 2. If you do not have a new product, will there be a reduction in the workforce, thus leading to retrenchment? 3. What will be the morale of those who are not affected? 4. If the market came to know about the retrenchment, what will be the reaction of the stakeholders, such as the financier (bank loans/overdraft facility), suppliers, distributors, and the consumers? If you do not have a new product line, continue with the existing one. Consider these two possible market strategies (listed in the Strategic Market Plan, pages 49 and 50). 

1. Market Penetration 

If it is a fast-moving consumer goods (FMCG), offer a free volume (example: an extra 50 gm or in cc). Note: If the product is perceived as being "old" in the minds of the consumers, simply change the packaging. The product materials remain the same. Re-launch the product as "new" thus moving it from the "decline" stage to the "introduction" stage of the PLC. If it is a durable product, offer a discount coupon for the next purchase. 

2. Market Development 

Explore new market segments. If the FMCG targets on the female segment, change the packaging to cater to the male segment. Many years ago, a talcum-powder manufacturer targeted its product in the infant-market segment. Subsequently through market research, it was found that adults were also using it (because the powder was "finer" in texture). Thereafter the manufacturer sold the same product (highlighting the powder texture) in larger containers for the adult markets. Consider launching the product in foreign markets. However, be aware that those were the eras when manufacturers simply exported the "decline" products to third-world countries. Today with the Internet, these so-called third-, fourth-, or even fifth-world consumers are well-informed. Will any of these consumers want to buy a typewriter? 

PROMOTION STRATEGIES 

Question: I sell clothing in the teenage-girl and woman segments. The half-shop lot is located in a town with a population of around 50,000. Business is slow. My friend suggested that I should advertise in the mass media. I have never done that before. I can afford about RM1,000. Appreciate your suggestions. 

Answer: If your consumers and buyers are within the town and surrounding areas, and with the relatively small budget, you can hardly use the mass media, such as newspapers to generate sales. There are many newspapers around. Which one can you use with that kind of allocation? Besides, the "lifespan" of a newspaper advertisement is only one day. Readers don't keep newspapers to re-read them. When their storerooms are full, they will call the "old newspaper" man. May we suggest the following strategies / tactics? 

1. Use flyers (folded A-4 sized papers) to distribute to houses and offices. Get a graphic designer to do the layout. To cut costs use the following tactics: a) Use black ink with light-colored paper. To begin with, photocopy around 500 pieces to test the market. b) To determine the effectiveness of the flyer-distribution campaign, insert a "cut-out" coupon for a discount of say, 5 to 10 percent off the selling price. Justify the campaign by saying it is a celebration of X number of years in operation; or an appreciation of continuous support by the consumers/buyers; otherwise people may interpret the campaign as a sign of poor business or desperation. Positive perception is very important in business. In the "Terms & Conditions" listed in the coupon, mention that each coupon is entitled to one item only; otherwise someone may bring 10 coupons (at 10 percent discount) and demand to get an item for free. Don't forget to insert a validity (expiring) date in the coupon. Would you want someone to appear 5 years later with a coupon? That's your decision. c) Distribute the flyers yourself. 

2. To generate publicity, organize social events, such as fund-raising for charity homes (contribute a certain amount for every item sold). Put up a banner in front of your shop. The town council may require you to apply for a permit. Get the banner-making company to do that for you. Consider inviting a VIP to officiate the opening event, and inform the mass-media people. Record the event (with your smartphone or digital camera). Post it up on social media such as, YouTube, Facebook, Instagram, etc. 

3. Consider developing your own website, if you have the time or your children are good with the Internet. It is quite easy to set up a website. Besides, it is low-cost too. For your information, this website: StrategicMarketPlan.com is registered and hosted with an annual investment of less than RM200 (around USD50). 

There are three (3) basic steps to put up a website: 

1. A domain name is required. Use the Internet to search for a company that registers domain names. Depending on the selected name and availability, the annual fee should be less than RM100. Note: You may use the hosting company to register the domain name. That way you don't need to pay to two companies if you are using the credit card. Also, it is prudent to use a local-based company. 

2. Next is to "park" the domain name (address) with a hosting company. You can find many hosting companies that are listed in the Internet. To begin with, select one that offers the lowest possible price. You can always upgrade when you need more "storage". For your information, the initial annual hosting fee for this website was only RM90. 

3. The third step is to develop the website. Ask the hosting company for advice on the software required for developing the website. This website uses the RVSiteBuilder software. Online tutorial for this software is available for free. The author spent around 10 hours (over 3 days) to learn from the tutorial and develop the site all by himself. 

DATA ANALYTICS

Microsoft® Excel®-Statistical Software for Analyzing "Small Data"

Microsoft Excel® statistical software is for analyzing business, market, financial and other data. Decision makers can use the information for formulating cost-efficient and profit-enhancement strategies. 

Marketers can execute the linear and multiple regressions software for the following functions: testing of hypotheses, ANOVA (ANalysis Of VAriance), and conjoint analysis. These are for: sales forecasting; predicting consumers preferences for product lines and service levels; markets segmentation; scenario simulations; and interrelations of sales revenue with product, price, place, and promotion strategies, among others. 

Excel Solver®: a special set of algorithm commands. Also known as the What-if analysis program. It can perform these key tasks: scenario simulations, determine profit-maximization, and cost-minimization of business, marketing, and other functions. 

The Solver is based on the regression algorithm. It is useful for analyzing data of all types: maximizing the return on investment, product-selling strategy, optimizing budget for advertising campaign, organize the ideal work schedule for manufacturing and product delivery schedules. 

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