Porter’s 5 forces is a strategy tool invented by Michael Porter to indicate the forces that shape industry competition. Taken from http://www. Tutor. Net/business/strategy/porter_five_forces. HTML The macro environment are the external forces that directly or indirectly affect all companies regards promoting, producing and selling to customers, these forces cannot normally be controlled. PEST Analysis for Britain: Politico-legal factors This includes legislation, voluntary codes/practice, market regulations, trade agreements and tax levies/breaks (marketing. Net, ND). Britain abide by the Codes of
Practice (Annex A) regarding marketing of soft drinks to children, they do not engage in marketing to children under 5 and have responsible guidelines for under ass’s (Gateway, 2013). Economic factors This includes interest rates, government policy, income, taxation and unemployment. In the Britain Soft Drinks Review 2014, Britain stated that drink sales were on the upturn, sales were on a record high after a long awaited decent summer, making consumers start to purchase more. After the recession consumers are also being less wary with their money and starting to return to choosing quality products (Graham, 2014).
Socio-cultural factors This includes demographics, culture, ethics and attitudes, changing family structure, trends and current issues. In March 2011, The Department of Health brought out the Public Health Responsibility Deal. Subsequently, Britain have now started labeling their products with a voluntary color-coded nutrition label on the front of their products for health conscious consumers (Graham, 2014). Technological factors This includes internet, television, mobile phones and global communication. Britain have developed a website for the education of young people, aimed at schools and also at students 14+.
It covers production, marketing and consumers and health and hopes to educate young people in these areas of the soft drinks industry (Britain, 2015). Question 3 Market Research “Market research is the collection and analysis of information about consumers, competitors and the effectiveness of marketing programs” (Ward, 2015). Market research is an essential component for organizations like Britain, they need to ensure that customers are happy with their products and find out ways in which they can increase popularity in their products.
Market research can be carried out through primary or secondary research. The data helps companies to connect with their customers to identify how to make their products successful and to find out ways for introducing new products into the market. It also helps to identify potential problems and gives companies the chance to solve them. Primary Research This is generally new research, to answer specific questions made through questionnaires, interviews, surveys or focus groups. The research is much more accurate than secondary research but can be time consuming and expensive to carry out.
Secondary research This research is undertaken through Journals, newspapers, internet and previous search. This research is not as accurate but is less expensive to carry out. Before the launch of Tango clear, Britain would have undertaken market research to find out what type of customer they needed to target and what flavors they would like, they would also have needed to check consumer trends. Question 4 Market Research Methods Market research is undertaken using either quantitative or qualitative methods or by using a combination of both.
Quantitative This research is mainly obtained through surveys and questionnaires, a larger amount of people are needed to obtain a good variety of answers so that the many can get a better idea of what people want in the target market. The questions would have to be carefully chosen to get the most meaningful data. This research would be able to tell what products were required on the market and what buying habits the potential market have, it would also be able to tell what interest consumers would have in the product.
Britain would possibly have used quantitative research by running surveys and questionnaires to find out what range of people to target with their new product Tango Clear, the surveys would inform them what age group to target and what flavors would be the best. Qualitative This research is mainly carried out with focus groups or in-depth interviews. This type of research looks more at people feelings and looks at trying to discover why people like something and their motivation behind buying the product.
This research is more able to ascertain why people buy things what makes them choose between products. Britain would possibly have used qualitative research for their new product Tango Clear, to find out what people’s feelings are about their products, why they chose one product over a competitor’s product and what the best sort of snacking would be. Question 5 Market Segmentation and Targeting Market segmentation is the splitting of consumers that have similar needs and wants into distinct groups or segments.
Customers that are in the same segment will share common characteristics which will help the company target those customers and will help them market to that segment (Financial Times, ND). Segmentation is very important in marketing, it helps companies to serve different customers and shows the company the best sections of the market to target. The four most used ways to segment the market are: Demographic – this includes factors like age, gender, income and other factors. Cryptographic variables – such as personality attributes, motives and lifestyles.
Geographic variables – this includes factors like population, religion, city size and other factors. Behaviorist’s variables – such as volume usage, end use, brand loyalty and other factors. If segments are identified using these methods then companies can tailor the product to meet the needs and wants of the particular segment, this would make the company more successful than its competitors at producing a reduce that was a closer fit to what the customer wants and needs. After segmenting the market, the company would have a better idea of which segment would be the best to target.
The different targeting approaches are: Undifferentiated targeting strategy is where a company promotes the benefits of its product to the whole market. Concentrated targeting strategy is where a company promotes the benefits of its product to one segment of the market. Differentiated targeting strategy is where a company promotes the benefits of its product to more than one segment of the market. Benefits BRITAIN have segmented the market by age, gender and lifestyles, Fruit Shoot has been aimed at children and families whereas JP and Tango are aimed at the teenagers.