Principal of Marketing for Journal about Brand Management

Question: Describe about the Principal of Marketing for Journal of Brand Management. Answer: Managers often face challenge to sustain the brand positioning in the competitive business environment (Tapp and Spotswood 2013). In other words, businesses find difficulties to maintain reputation and continue each products hold in the market place (Fitzgerald, Neal Cavanaugh and Borden 2014). The given case study also discussed their marketing journey and several ups and downs since their inception. However, the brand Vegemite continued to widen its consumer base and target audience. However, the iconic brand faced difficulties when iSnack 2.0, a line extension product of Vegemite has introduced into the market. Based on this case study, the researcher has addressed all the given questions. 1. Marketing mix is an effective tool for analyzing the product position before entering into the market (Lapide 2015). There are many elements incorporated into the marketing mix. However, the main elements are product, price, promotion and place. This case study demonstrates Krafts brand strategy. Based on the analysis of the case study, the company, Kraft, faced problem due to introduction of a unique brand promotional strategy for the release of iSnack 2.0 in the Australian food market. It means the strategic decisions regarding the promotion, proved the most problematic for Kraft. Marketing tool is often vital when it is used for brand offering (Tapp and Spotswood 2013). With the right marketing mix, the business actually can obtain the best result after launching the product. However, Kraft had made a wrong brand strategy for promoting new business range into the market. According to this given situation, the company did not get the expected positive response from their target audiences. The company made mistakes during the promotional campaign of the product (Leekha Chhabra and Sharma 2014). Kraft had given more importance to the announcement of the new name regardless of the highlight the features of the new product. Despite the fact that iSnack 2.0 was offered in the de mand of the people from Australia, however, the company had arranged three months long naming competition. This was the reason that the company faced criticism from customers who declared the name as stupid. By the name, the company was also differentiating their product from the original Vegemite. According to the marketing theory, brand recognition is important for sustaining in the competitive environment (Fitzgerald, Neal Cavanaugh and Borden 2014). In this case, Vegemite is already a part of Australian food history. Therefore, it was irrelevant to give extra emphasis upon the brand promotion for the sake of the name of the new product. Furthermore, this had proven that Aussies were interested to experience the new variations to an old favorite. In this context, this can be said that the name of the product is not as important as the product features. Therefore, the extensive public involvement to name the new product may be the reason for not elicit the expected positive responses from their reliable customers. 2: Despite the public criticism of the iSnack 2.0 name, Kraft was recorded positive consumer responses after its initial release. The company had been followed market mix tool considering four aspects of their new product. This tool is used for offering product at the right quantity (Product) with the right price (Price) in the right place (Place) by using the most appropriate promotional (Promotion) strategy (Campelo et al 2013). However the company met the following condition before developing the right marketing mix for iSnack 2.0. Product: In 2009, Kraft responded the consumer feedbacks and identified that there is a huge product demand with some specific consideration. As per the consumer choices, iSnack 2.0 was introduced in the market which was creamier and the consumer would not get any difficulty to spread. In addition, Australian people wanted something which did not like butter at all. All this product specification was incorporated into the new product of Kraft. After an online market research campaign the company determined that which could easy to eat on the go and could dip straight from the jar and eat by itself. Kraft developed a new product by the name of iSnack 2.0, was a perfect mixture of original Vegemite and cream cheese. Thus Australian liked the taste and the new product was at success because consumers had found same features what they demand for and this is the reason that more than 3 million jars of the product were shipped within just three months period after the launch. Price: Australian people were ready to accept the new product without considering price element. However, the brand is very specific about their product and known for its right price. This is the one of the reason why Vegemite has a 90 percent penetration of Australian homes. This iconic brand is popular for its affordable price strategy since the year of 1939 when the product got recognition for its Vitamin B content, but the company did not change the momentum of the product. There were no price hike and this strategy had been followed at the lunch of iSnack 2.0 as well. Place: Vegemite is the iconic brand of Australia. Vegemite continued to widen its loyal customer base in the food industry of Australia. This is the reason the new product had launched in the several supermarket of Australia. Promotion: For the promotion of the new product, Kraft had been practiced an extensive promotional campaign for generating maximum customer response. Kraft lunched a competition among the Australian to name the product. This is a unique promotional strategy because the company made involved all the people of Australia and successfully generated the awareness and increased the curiosity among the heart of Australia. The company had promoted their product through social media like Twitter and their responses got recorded. However, an extensive marketing for the name of the product go against for iSnack 2.0. According to Neuvonen (2016), the target group needs to be made aware of the existence and availability of the product through promotion where product featuring is essential. However, the company made a huge mistake. In the brand promotion, the company needed to make a clear statement about the ingredients, health related factor. While attempting to speak to a particular market segment by the name of iSnack 2.0, the new product failed to place in the heart of Australian people. People: Kraft had been focusing the local consumers demand while developing the new product iSnack 2.0. As per the desired product specification, the company had developed their new innovation. Therefore, people are the main driving force for such innovation. In this way, each elements of marketing mix may have contributed to the initial success of iSnack 2.0 marketing strategy developed by Kraft. 3. The given case clearly indicates that Vegemite has developed an iconic brand status and the company is sustaining with wide ranges of loyal customers in Australia. Now Vegemite has been using this brand reputation for developing a recent line extension product, .Cheesybite. This is always advantageous if the products recognized by the consumers (Braun 2012). However, it takes time and many challenges may be faced by marketers. In the fast moving consumer good area, the brand has successfully occupied its position. However the company has started their journey slowly in the market and faced difficulties to draw customers from the competitive product called Marmite. Or getting more consumer response the company had even changed their name but all these efforts went into vain. After that the original brand Vegemite was reinstated in the year of 1935. Since the participation with Kraft Food, Vegemite had boosted their position and the brand had successfully penetrated the Australian f ood market by 90 percent. Therefore, this brand would definitely like to maintain this position in the coming years. Furthermore, Kraft would like to hold loyal consumers by making innovations into their product developmental processes. However, there is a high chance to face many marketing challenges by Kraft in maintaining the brand status of Vegemite. These probable challenges are as follows: Maintaining the brand consistency: Branding is more effective when it is maintaining consistency, but it may challenging when small business grows or developing line extension products for maintaining higher customer demand (Dinnie 2015). In this context, Vegemite had extended their operation by introducing new products into the market. The loyal consumers of the company may have been their target consumers; however, delivering such product with consistency will definitely be a challenging part of Vegemite. Changing consumer preferences: The consumer preferences or demand for the product is always important before offering any product into the market (Swani Milne and Brown 2013). In this case, the decision regarding the introduction of Cheesybite, by the Kraft was completely based on consumer preferences. Here Australian consumers even specified what kind of products they are demand for. The brand has maintained the same features into their new products and got the taste of success. However, there is a huge risk of changing product preferences of consumers. In that case, the products may not be sold despite having the same consumers in the market. Presence of similar product ranges: The marketer may face challenges if similar kinds of products are available in the market (Theng So, Grant Parsons and Yap 2013). Currently, the brand, Vegemite has been maintaining brand status because this brand holds majority of the market share. However, if such loyal consumers finds alternative in the market then product demand or growth of revenue may definitely be reduced. Then it would be difficult for marketing managers to sustain the same brand position. Possessing a compelling vision: A brand vision needs to be differentiated itself, inspire employees and resonate with consumers (Leekha Chhabra and Sharma 2014). However, brands often find difficulties maintaining dynamic marketplace. In that case the brands need to engage more into the brand-building program. These immense pressures sometimes change the vision of the business. Building digital strategy: In the rapidly changing business environment, new product innovation, new capabilities and creative initiatives needs to be taken for maintaining the competitive advantages (Theng So, Grant Parsons and Yap 2013). In this context, the brand requires to be involved in the digital marketing to generate product awareness. Therefore, developing an effective digital program is often challenging for markets of the company. In the given case study, the brand was also promoting their new products by building digital promotional strategy and used the social media platform like Twitter. However, consumers instant reviews or feedbacks may hamper the status of the brand within a fraction of time. Recommendations: Kraft needs to promote the product features with displaying clear information so that consumers may not have any doubts while purchasing such products from the market. It means, an effective and innovative brand strategy needs to be included. Kraft needs to organize some primary research and conduct some questionnaires, surveys, interviews to know the changing consumer demands or complaints regarding the existing products or services. Based on such specifications the company the company will be able to develop new products into the market. Kraft must develop new sub categories of brand and build barriers to inhibit rivals from gaining relevance. This definitely requires transformational innovations which unfold the companys new ability to manage or fulfilling new consumers demand. Kraft needs to choose an effective integrated marketing communication through which Kraft will communicate with consumers and will understand their preferences, demand, or queries, if any. 4. A business utilizes the environmental resources and supplier goods and services to the environment. No entity can function in isolation because there are many factors that are closely and distantly surround the business (Wang et al 2014). This business environment has two parts: macro environment and micro environment. The micro business environment are internally influenced the business whereas the macro environmental forces are those of outside forces, that may be related to regional level, national level, or international level (Mohan and Chitradevi 2014). These macro environmental forces are going to be discussed in this section of the assignment. Furthermore, it provide threats or opportunities to the communities of business. Every organization often tries to manage these threats by effective utilization of resources (Kormishkina et al. 2015). These six macro environmental factors include Demographic environment, Economic environment, Ecological environment, Political environ ment, Technological environment and socio cultural environment related to a particular business. (Source: Thai and Turkina 2014) The macro business environment is all about the broad environment within the economy that influences performances, functions, decision making, and strategy of all group of business. All the elements of the macro environment are flexible, uncontrollable and rapidly changing with the consumer demands. By analyzing all factors, business can identify the product or service opportunities and limitations in the market. This study of the macro environment is called as PESTAL Analysis (Yksel 2012). Below are the variables of PESTAL that exist in the market: Demographic environment: Demographic business environment refers to the study of population. The factors are includes: The size of the population Growth rate Age of the population Religion Caste Level of education Language Income Race Size of the family Employment status These factors are relevant to the market to develop and implement the strategy for controlling and fulfilling the goals of the business (Grnig and Khn 2015). In the demographic field, people are the main driving force for the development of the markets. The diverse and wide demographic fields offer new business opportunities and can ensure the future growth of any particular business. However, this study is also critical for marketers because rapid changing business growth of the population or instability of income of the people can derive negative impacts over the business. Therefore, marketer should keep a close eye on demographic business environment. There are many demographic trends affects the markets are as follows: Changing population: The growth of the population is welcoming new business opportunities and challenges as well. Due to such demographic changes, the business entity should change their marketing strategies for selling the product and services to their target customers. Changing age structure: The changing age structure of the population is another important factor influencing the market. For instance, India, the developing Asian country, has one of the youngest populations all over the world is expected to keep that status and assumed that the median age would be 28 years. This may result adversely reduction in dynamism and this business can face problem related to changing demand of consumers. Changing income pattern: Income distribution is one of the common demographic factors by which market influences majorly. Business often measures the saving patterns of different level of individuals, purchasing power and so on. By this, the business entity can forecast and assess the intensity of the market opportunity and threats of the business. Economic Environment: The economic condition is one of the significant forces of macro environment of the business. An entity assesses the economic conditions, policies, economic system of the nation at which the business is operating (He 2015). To understand the economic condition of the nation, the business needs to assess the important criteria such as growth of the GDP, tariff and non-tariff rate, Vat, rate of unemployment, inflation, purchasing power, spending pattern and so on. There are many economic trends influence the businesses are as follows: Growth of GDP: The countrys infrastructural development ensures the GDP. This refers the total economic activities of the nation. The high GDP growth is always desirable because the nation can explore new market opportunities (Thai and Turkina 2014). This further ensures the average purchasing power of the consumers is high. It means that they can expend the money for buying product or services. Here the purchasing power depends on the several economic factors like current income, circulation of money, credit and debt availability and others. Barrier of tariff or non tariff rates: This is one of the important economic factors. The marketer often takes decision regarding the production of business based on the tariff rate. A high burden of tariff and non tariff of the nation tend to discourage the marketers to continue the business in that particular economic condition (Hill, Cronk and Wickramasekera 2013). Changing pattern of spending: Spending pattern is depends on many economic variables such as availability of the economic resources of the nation, distribution of income and assets of the nation and so on. Technological environment: This forms a crucial influence in the external market environment. This refers the factors that helps to develop new technologies, create new products and upcoming market opportunities. However a business entity that unable to cope with rapid technological changes may not be survived. This is further take into consideration that technological environment is differing from market to market. In that context, marketers need to consider some product modification to sustain in the global business environment. Although business may face many technological issues. For instance, non accessibility of internet facilities for all employees may hamper the business performance. On the other hand, technology provides customer to online shopping through the internet technologies. Ecological environment: Changing ecological environment is another essential consideration for macro environment analysis. Environmental concerns have growth strong presence in the business development (Epstein and Buhovac 2014). For instance, energy consumption, air and water usages need to be handled by implementing new business strategies and functional efficiencies. Important trends in the ecological environment are the growing shortage of natural resources and thus the care for resources. However, there is a potential threat of increased pollution, but this can be managed by the effective government intervention. Political environment: Every business is surrounded by the political environment. There are three significant elements of legal or political environment: legal, political and government Government: Policies, rules, regulations of government are governing and monitoring business activities of an enterprise. The regulatory framework, tax structure all are impactful considering the assessment of political environment of the business. Legal: Without having a sound legal system, the marketer cannot run his/her business (Hill, Cronk and Wickramasekera 2013). Legal system unfolds various business opportunities which are protecting competitors, customers and enterprises. Political: Stable political system also favorable for the growth of the business. There is a trend of political pressure to business where government pays extra attention for rights of minority, womens right and the right of consumers Social environment: Businesses are binding with social activities because it affects adversely, if business ignore customs, traditions, preferences, tastes, and knowledge (Hopkins 2012). All such factors are associated with human relationships and it impacts on business culture. The social trends like role of the business in the society, ethical business practice unfolds business opportunities. In this way, the six different macro economic factors help all businesses to operate. 5: Marketing information is a set of method and procedures designed to generate to analyze, store, generate and anticipate marketing decision information on a systematic manner (Piercy and Evans 2014). The marketing information is essential for marketers to obtain information like current business condition, position of competitors, scope of innovation, customer preferences, changing demand and so on. To understand the proper role of the marketing information, the researcher must examine what managers do and what information they need for their decision making. In this section, different sources of marketing information will discuss for understanding the value to marketing managers. It will further discuss the potential dangers if the marketing manager has taken his/her decision following from one source of information. Generally, the marketing manager is responsible for planning, organizing, coordinating, deciding and controlling business activities. According to Nedeva (2014), information system in managerial role is limited and make only indirect contribution such as communication oriented functionalities. However, Queiroz and Oliveira (2014) opposed that marketing information system enhances a managers presentation of information and largely in his/her decision making. Managers are involved in three types of decision making processes strategic, operational and management control. Under the strategic decision making, the managers need to decide the marketing objectives, policies, resources of the organization. In this context, managers often face problem in predicting the future of the market and its environment. For this reason the marketing manager needs to access marketing information. On the other hand, management control involves close interaction of those who are responsible for doing such part. It is all about decision regarding the how effectively and efficiently resources are being utilized by the managers. These responsibilities could not possible if marketing information is not available. To respond day-to-day changes in the business environment is also required for ensuring operational control and hence marketing information are essential. Marketing information can be obtained from three different sources: internal data, competitive marketing intelligence and marketing research. The set of information is a nonstop process that gathers data from these sources. Internal data about the company or business enterprise are collected from previous annual reports, websites, feedbacks where data like sales, profile of customers, orders, stocks customer service report can be gathered by the effective use of the marketing information system (Salvador and Ikeda 2014). By the extensive research of the internal source of information, manager can understand the key performance indicators of the business and also gathered information regarding the business limitations, operational inefficiencies and other concerning parts as well. On the other hand, information relating to marketing intelligence is also an important source of information for the managerial decision making. The data of marketing intelligence contains information relate d to suppliers, distributors and customers (Theodosiou and Katsikea 2013). This includes the everyday information regarding the product or service development in the market that helps a business prepare and adjusts its marketing plans accordingly. The information of marketing intelligence is possible to buy from external suppliers (ORG, MARG) who set up data gathering system to support commercial intelligence products that can be beneficial for selling to all entities in the market. Lastly, the gathering information by exploiting marketing research is common source of MIS. Management cannot always wait for information to arrive from internal sources. In that context, managers often make involve themselves in extensive marketing research and gathered information for decision making. By this research the marketing managers can get information regarding the potential market position, target customers, existing competitors in the market and their marketing policies, strategies and manag erial decisions (Davenport 2013). This information helps to understand the potential customers preferences, their demand, choices. However, managers may face difficulties if he/she obtains required information from one source alone. For instance, sources of marketing intelligence cannot always be relied upon because managers may find such information not up to the date. On the other hand, internal source of information gathered from company website may also be found irrelevant at times (Queiroz and Oliveira 2014). This is the reason marketer often complain that they lack enough information or have most of the information wrong. Therefore, a single source of information is no enough for decision making in the business. Generally, an extensive information gathering all three sources are required high time involvement which may not possible to give all the time for the manager and they obtain such information from a single source of MIS. Thus, marketing managers need to explore different sources of information to get the appropriate information which are important for decision making. The necessary ingredients for a good MIS are consistency, completeness and orderliness (Piercy and Evans 2014). References: Braun, E., 2012. Putting city branding into practice. The Journal of Brand Management, 19(4), pp.257-267. 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