THEME: NEW PRODUCT LAUNCH

Name

Course

Name of Professor

University

Date

Theme: New Product Launch

1. a.

C&L Wheels Limited plans to release a new variety of children’s leisure bicycles. This will be in response to the increasing demand for family cycling. Target customers will be identified based on distinct market segmentation. According to Hollebeek (2011, p 511), customers refer to all individuals who play a crucial role in supporting the company by purchasing the company’s products and services. Research conducted by Kim et al. (2006 p 102) customer segmentation is dividing customers into distinct categories. This criterion will be crucial in marketing the new bicycle models since it allows each class to be focused on more closely, thereby increasing market efficiency.

In this case, we are going to segment the customers based on two segmentations.

1. Demographic.

A recent study conducted by Brayant (2020) shows that there has been a boom in family cycling with the recent Covid 19. To meet this increased demand, we intend to target the working population, especially those in the middle social-economic class. The communication plan will target the working parents, mainly between 30 and 50 years, since they are most likely to have children aged between 10 and 15. According to recent studies, experts also say that these parents have turned to cycle to keep their children busy; “lockdown is drawing new people into cycling – especially families trying to keep restless children entertained” Brayant (, 2020). Weekends have been pointed out as the busiest days of the week (Brayant 2020). This is a clear indication that most of the potential customers fall in the working-age, and it will be crucial to target working parents between 30 and 50 years.

2. Psychographic segmentation

In this criterion, we will target the motives and various lifestyle choices, shifting the bike demand up. Based on recent empirical studies, the lockdown caused by Covid 19 has dramatically increased the demand for family leisure bike riding (Carter et al. 2020, p 1176). To address this motive, we intend to build models that are comfortable and strategically designed for leisure.

With restricted movement brought about by the Covid 19 pandemic, parents are becoming more worried about their children’s physical health (Yang et al., 2021). This has, in turn, led to an increased demand for bikes. To improve our market share, we will target worried parents and engage in intensive advertisements to highlight the physical benefits of cycling.

In the case of C&L Wheels, market segmentation will be crucial to help in the identification of the most effective strategy. Demographic factors are essential to determine the targeted population and the population’s income. This will be crucial in depicting the marketing strategy and forecast the sales (Uddin, and Nasimuzzaman, n.d). On the other hand, psychographics segmentation will help inform the company on the motives behind the demand trends and the various factors affecting demand. These factors, such as lifestyle, will immensely affect the business and help the company to plan its marketing strategy based on the factors influencing the market.

Focusing on the various segmentation factors such as demographic and psychographic criteria, C&L Wheels will have a clear picture of the target population and their distinctive characteristics. Having known the features of the people, the company will thereby be in a position to structure its marketing strategies effectively to focus on the target customer.

1. b.

Demographic segmentation will be crucial for C&L Wheels Company as it plans to launch its new model of bikes. This is because the bicycle design to be launched been manufactured for a specific age group and population between 10-15. This limits the scope of the target population and subsequently affecting the customer’s decision-making process. Customers have a tough time in making decisions as various internal and external factors have to be considered before settling on a specific product (Reddy, 2017. The customer decision-making process can be categorized in a series of stages;

Stage 1: Need or Problem Identification

This process entails a consumer determining the need based on the discrepancies between the current state and the desired state (Ratasuk, 2019 p 37). If there arises a significant disparity in the states, a consumer goes ahead to search for information on how to meet the need. Recent studies have shown that there has been an almost double increase in demand for bikes and especially for leisure purposes. To address the consumers’ needs, C&L Wheels has altered its marketing mix to maximize the market share. Through modification of a new bicycle design, the company will necessarily capture the needs of the consumers, especially of the age group 10-15.

The new C&L Wheel bike model is strategically designed to provide comfort to children and efficiency, unlike the conventional cycles. The new model comes with an additional benefit of comfort and efficiency for children aged between 10 to 15 years. The product specifications are pretty superior as compared to other brands and thereby will give the company a competitive advantage. Moreover, the new design will meet the specific demands of customers and thereby help customers address their previous concerns and experiences with other products.

Stage 2: Information Search

This stage entails a consumer looking for information on the product based on his or her needs. After having activated problem recognition, the customers are going to research the new product to be launched (Ratasuk, 2019 p. 44). The search is going to focus on; bicycle’s specifications, weight, product features, warranties, quality, and age specifications. At this stage, personal tastes and preferences are to affect the search process. Customers are expected to search on various specifications based on subjective factors they consider to be most crucial to them. Customers may also sign in trying to solve problems experienced with multiple products in the past. The company must provide rich information on the website based on the product features and specifications, highlighting key features such as model strength and leisure suitability. The “find your ideal bicycle” search option on the website will also come in handy as clients will also choose other models based on their desired features.

Stage 3: Evaluation of Alternatives.

After customer searches, the customer is likely to narrow down to fewer options of the bicycles. If a customer only requires one product that best suits his/her needs, the customer must evaluate the alternatives at hand (Reddy, 2017). At this stage, a customer is expected to make a choice and match personal wants to the various attributes of the products at hand. Personal beliefs and past experiences a consumer have had may significantly affect this process of evaluating alternatives.

Stage 4: Purchase Decision.

This stage entails the actual purchase of a product. It follows after narrowing down from various alternatives and selecting a single product that maximizes a consumer’s utility (Ratasuk, 2019, p 50). Unexpected situational behavior and attitudes are likely to influence the intention and actual purchase of a product.

Stage 5: Post-Purchase Evaluation

This is the final stage that occurs after a customer has purchased a product. It entails giving feedback on the functionality of the product. This stage is usually characterized by matching expectations to reality. Customers provide feedback based on their expectations and the experience they have had in interacting with the actual product.

Task 2

Communication forms the core of the business world, paving the way for essential management functions Hargi, (2016). According to Genç et al. (2017), organizational communications are crucial in the strategic planning stage, creating a channel through which objectives and strategies are communicated from top management to the workers and vice versa. Communication plays a fundamental role in the business, both internally and externally. Having identified our targeted consumers of the products to be aged 10 to 15, an aggressive marketing strategy focusing on parents aged 30 to 50 is inevitable. We will adopt an aggressive marketing strategy showing actual children having fun riding the specific model together with their parents. The marketing strategy will also highlight the health benefits of cycling for the targeted population.

To ensure there is a smooth and effective flow of communication, the AIDA communication model will be adopted. AIDA model is a funnel purchasing model that identifies the cognitive stages a customer goes through before purchasing the final product (Jansen and Schuster, 2011). The model is an acronym, namely Attention, Interest, Desire, and Action. This marketing strategy will be pretty crucial for C&L Wheels’ marketing of the new bicycle design.

Awareness

In this stage, marketing will be broad and aimed at generally creating awareness of the new design. C&L Wheels shall adopt an aggressive marketing campaign on social media and media blogs. The social media marketing shall highlight pictures and videos of people having fun riding the new design of bikes and shall be posted on various social media platforms such as Facebook, Instagram, TikTok, and Twitter. The social media marketing plan will also make use of social media influencers and famous celebrities.

Interests

This stage narrows down to specific target customers aged 30 to 50 years. It aims at giving specifications to match their interests as well as highlighting the superiority of the brand as compared to other brands in the market. This strategy will play a crucial role in activating the target customers’ interest and encouraging them to research for information.

C&L Wheels shall make use of TV commercials that show a family having fun as children ride the new cycle design. The TV commercial shall highlight the added comfort and superiority of the specific brand in comparison to other products in the market.

Desire

The process entails giving the customer an emotional connection to the new bike model and thereby moving customers from mere liking of the product to wanting the product.

C&L shall launch the new product in an event which will bring together some of the celebrities. The event will also be launched in an exclusive event that will be highly advertised and aired by the press, and posted on social media. This is likely to impact the emotions of the public as they see their celebrities launching and even trying the new bicycle design.

Action

The final stage entails stirring the customer to take action. The action could be making phone calls, placing orders on the website, or actual visitation of the company to purchase the new bike models.

C&L Wheels Ltd shall place links on various social media platforms. Clicking on these links will allow customers to see multiple products and also place their orders at their convenience.

2. b.

A communication plan is quite an effective tool in businesses since it provides a mechanism by which company goals and strategies are communicated throughout the organization (Farzaneh and Mansoor, 2017). The communication plan also ensures that there is an effective interaction between the company and the customers. Despite the immense benefits, there are various factors, both internal and external, that affect the effectiveness of the communication plan.

Internal factors

These are factors within the organization that all come together to contribute to the overall success of the company. It is vital to focus on the internal elements when coming up with a communication plan (Farzaneh and Mansoor, 2017). To help in analyzing the internal factors, a 5M model will be adopted.

• Men

An assessment of the workforce based on skills, competencies, and knowledge will be crucial. This assessment will be done in line with the new cycle design. It will be vital to determine the extent to which laborers can adapt to recent changes and develop the new model. The number of workers will require to be evaluated to ensure that there are enough skilled workers to meet the expected rise in demand.

• Money

Money forms the core of any business. An assessment of the company’s ability to launch the new product will be necessary. The evaluation will focus on capital to increase manufacturing capacity along with advertising the new product into the market. Lack of adequate capital will likely delay production or necessitate the company to focus on other revenue streams.

• Machines

C&L Wheels being a manufacturing company, requires intensive use of machinery. Before launching the new product, it is crucial to assess whether the existing machinery can meet the expected demand and also manufacture the new model. In case existing machines fail to meet current needs, this will necessitate the purchase of new machines to manufacture the new model.

• Materials

An assessment of physical materials is also crucial before going ahead with the product launching. The company should assess whether all materials required for manufacturing are available. Lack of necessary materials is likely to impair the production process.

• Minutes

Time is an essential factor in the production process. The company should first of all check the time available and compare with the effectiveness of the resources available. Machines and workers’ efficiency will be crucial to determine the manufacturing capacity. Reduced efficiency is likely to slow the production process.

External factors

C&L is surrounded by numerous external factors that can affect the new product launching. To determine these factors, a PESTLE analysis will be crucial;

• Political factors

This focuses on the extent of government intervention in the bicycle sector. Factors such as government policies and regulations could have devastating effects on the company (Pan et al., 2019). Recent government moves to increase health regulations are likely to affect the sector and push the prices of the new model slightly high. The lockdown in recent times has also led to a spike in demand for leisure bikes for children.

• Economic factors

With the Covid 19 pandemic, the economy has been in a contraction phase characterized by high laying off of employees and reduced per-capita income (Carter et al. 2020, p 1176). In the recent future, the customer’s purchasing power is likely to be affected, and this is likely to lead to reduced demand for leisure bikes.

• Social factors

A recent demographic report shows that the population aged 25-54 comprises 39.5% of the total population. This is the highest population as compared to other age groups. It also contains the working class who include of our target customers. Researchers have also forecast continuous population growth, thereby increasing optimism on the future of the new cycle design. An increase in the target population will have a positive effect on the demand for the new bicycle model.

• Technological factors

Despite the increase in technology, the demand for bicycles has remained relatively unaffected. With recent environmental concerns, people have turned to cycle. The various designs such as lightweight and folding capacity have increased effectiveness as people can still use bicycles in public transport. The increase in lifestyle diseases such as obesity has led to the rise in demand for leisure bikes and thereby rendering technological advancements to have very minimal effect on bicycle demand.

• Legal factors

Being a manufacturing company, the new product is subjected to patent and copyright laws company (Pan et al., 2019). Safety and consumer protection laws will also have a substantial effect on launching the new product. These factors would lead the company to be sued and face immense legal consequences as fines and license revocation.

• Environmental factors

Due to the pollution targets and carbon footprint targets set by the government, it will be crucial for the new product manufacturing to conform to set environmental standards company (Pan et al. 2019). Failure to do to these standards would lead to a denial of licenses and thereby affect the launching of the new product.

2. c.

In an attempt to launch the new product, effective communication and marketing are crucial. Marketing will be conducted targeting the customers aged 30-50. The effect of children influence their parents to purchase the product will also be focused on ensuring that the products appeal to the children’s desires and wants. To adopt the communication plan, a series of communication tools will be adopted;

1. Advertising

This is a paid form of communication that is passed through mass media in an attempt to popularize a product and also activate demand for a product. To reach our target customers, we are going to pay for TV commercials highlighting the new product and its immense superiority to other products in the market (Dudnikova, 2014 p.3). We are also going to make a series of pictures, videos, and blogs and post them on social media through the use of the social media hurdles and also through paid social media influencers.

Advantages

• Advertising is an effective technique to reach numerous people within a short period and at low costs (Dudnikova, 2014, p.2).

• Increases sales and sales revenue

Disadvantages

• Advertising is likely to increase the price of the new model as the advertising cost is shifted to the final consumer (Dudnikova, 2014, p 2).

• Deceptive advertising promotes unnecessary consumption.

2. Sales Promotions

This is a direct inducement that increases demand for a product offering customers an incentive to buy the product (Gupta, 1988. 348). To stimulate demand and provide the new product competitive advantage, offering incentives will be crucial. The incentive “buy a bicycle and get free safety gear” will be essential in encouraging customers to buy the new bicycle model. The company could also stimulate secondary marketing through “Refer 2 customers and get a 75% discount on the next purchase.”

Advantages

• This communication tool is effective in building a lifetime relationship with the customers.

• It increases the sales revenue.

• It is also an effective tool to create awareness of new products.

Disadvantages

• The profitability of the company will be immensely affected, like a lot of resources are invested in offering incentives and popularizing the incentives offered (Gupta, 1988. 352).

• It may also condition customers to promotions affecting sales in case.

3. Direct marketing

Direct marketing refers to all media activities that are strategically designed to target actual or potential customers directly rather than through third parties (Palmer and Koenig‐Lewis, 2009). We intend to directly target populations aged between 30-50 and appeal to children aged 10-15. Having a positive appeal is likely to activate demand and increase target populations’ desires.

Advantages

• Increases Effectiveness, reaching numerous customers at a relatively low cost.

• It impacts the customer’s emotions and thereby building a lifetime relationship with the customers.

• Direct marketing involving particular actions like subscribe to social or like posts ensure measurability of the Effectiveness (Palmer and Koenig‐Lewis, 2009).

Disadvantages

• Direct marketing leads to an increase in the final product of the new bicycle model as the marketing cost is transferred to the final customer.

• Intrusive- many people may find direct marketing to be disturbing, especially if they do not fall within the target group (Palmer and Koenig‐Lewis, 2009).

• Legal issues on privacy and data protection govern direct mails and limit recipients only based on consent.

3

1. Customer Communication Plan

A customer communication campaign will be crucial in ensuring that customers are aware of the new bicycle model set to be launched soon. Communications campaigns employ premeditated marketing strategies to transform knowledge, attitudes, behavioral patterns, or policies through marketing and advertising techniques within a given target audience (Coffman, 2002). Recognition of marketing power and publicity in consumer decision-making is crucial in the campaign process. C&L Wheels will engage in a series of campaigns aimed at increasing customer awareness of the new bicycle model set to be launched soon. The target customers have been determined through demographic segmentation. The bicycles have been designed for children aged 10-15. Since children are not eligible to work as per the law, the target customers will be their parents, who mostly range between 30-50 years.

C&L will conduct a marketing campaign to achieve the following objectives.

1. Increase our website inquiries by 22% in the next eight months

2. Increase the brand awareness to 20% in the next eight months.

Campaign Message

When it comes to quality bicycles, we C&L Wheels Ltd is the best. The company was founded 30 years ago by two bicycle enthusiasts and has advanced over the years providing customers with modern custom-based bicycles that meet expected demands. We specialize in manufacturing bikes suitable for commuters and leisure cyclists. In recent times, we have heavily invested in technology to ensure our bikes are of high standards. Cyclists who need bicycles for commuting, especially in cities, have been adequately covered getting bikes of relatively low weight, which makes it suitable for them to use public transport. Recent trends have also led to an increase in leisure bikes as customers need to keep fit and at the same time have fun. To meet these needs, we developed classic bicycles with more robust frames and broader tires, allowing for occasional wide road use.

Over the past year, we have heavily invested in developing a leisure bike targeting children between 10-15 years. This is after detailed market research where we realized that previous bicycle models were weaker and unsuitable for children between these ages. In response to this, we have made leisure bikes for children aged between 10-15. This new model will have strong frames, wide durable tires, comfortable custom seats for all genders, beautifully designed colors, and also trendy make, which makes it attractive as compared to all other previous designs.

A recent study conducted by Yang et al. (2021) shows that the current Covid 19 pandemic has led to a significant increase in obesity cases. Bicycles play a crucial role in keeping individuals fit and also acts as a mode of entertainment. Based on empirical research conducted by Otovwe et al. (2017), bicycles play a crucial role in correcting Body Mass Index and also reducing blood pressure. With the recent pandemic, most schools have been affected, and with children spending the most time at home, they are likely to become obese due to reduced physical activity. It is therefore crucial for parents to take measures and engage children in physical activities through organizing weekend family cycling days.

Children between ages 10 and 15 require high levels of exercise to keep fit and avoid lifestyle diseases such as obesity. Bicycle riding is the best alternative since it is interesting; moreover, it is a great way to exercise. To improve this experience, we have strategically modified a new design to fit this population’s requirements making cycling even more fun. The strength of our custom-designed products makes us the best option in the market. We acknowledge that safety is vital when cycling; to make sure our customers are safe, we offer free complete safety gear for each customer upon successful purchase. We have a firm policy on quality which has made us a worldwide acknowledged brand; to reassure our customers on the quality, our bicycles come with a 1-year warranty.

The new bicycle model will be available in our dealer shops near you from next month after the official launching. Customers will have an opportunity to register on our official website and search for bikes that meet their specific requirements. The new model will also be available on our website after the launch. We welcome all to our launch, which will bring together some of the celebrities; the event will be live-streamed live on our Facebook and Instagram pages. We welcome you all to visit our website, register, and lookup for lifetime deals you will never find anywhere else.

3. b.

In the marketing process, communication is a formidable force with the capacity to bring tremendous effects. Effective communication is crucial to ensure that the marketing strategy adopted reaches and appeals to the targeted customers. Choosing an appropriate customer communication mix is critical for determining the effectiveness of the marketing process. The following tools will be crucial for C&L Wheels as it plans to launch the kids’ new bicycle model.

1. Advertisement

The target customers for the new product come from quite a vast population both locally and internationally. To effectively reach these customers, it is crucial to use advertising as one of the communication mixes tools. Advertising refers to all avenues in which businesses pay to have their products and businesses broadcast (Dudnikova, 2014, p.3). It entails the use of a third party to popularize a product. C&L Wheels should adopt advertising as one of the techniques as it plans to launch its new product.

Advertisements should target parents to children aged between 10 and 15. The ad should be structured in such a way that it meets trendy fashions to appeal to the targeted population. The bicycle advertisement should also focus on parents of these children who are primarily in the age bracket of 30-50 tears old. The ad should highlight the superiority of the brand, including the frame strength, wide durable tires, and also the comfort created by the bikes for the targeted children.

To effectively capture the viewer’s perception, we intend to use creative, eye-catching, and musical content to ensure we appeal to the customer. The advertisements will include TV commercials, sponsored blogs, and also supported social media photos and videos (Dudnikova, 2014, p.3). Advertisements will play a crucial role in increasing brand awareness and contributing towards the estimated 20% increase in awareness. Having raised the understanding, there will be an increase in demand which will, in turn, increase the level of sales and sales revenue. An advanced sales revenue will be crucial in helping the company attain its strategic goal of expanding the market share in the coming periods.

2. Sales Promotion

Sales promotion is the act of introducing incentives to make a product more appealing to the customers (Gupta 1988 p 344). C&L Wheels will conduct sales promotions targeting potential customers aged between 30 and 50. The company is committed to offering free safety gear to all customers upon successful purchase. Research conducted by Valentine, and McKendrck, (1997), shows that there is a significant concern from parents on their children’s safety when riding. Offering safety gear will be a crucial move in distinguishing the product from other designs and giving the company a competitive advantage.

The company is committed to offering the best quality products, which have led it to become a globally recognized brand. The new bicycle design will come with solid bars and wide durable tires. In addition, the company is committed to providing customers a 1-year warranty for the product.

Sales promotions will play a crucial role in formulating a long-lasting customer relationship and also promote brand loyalty. Sales promotions are targeted to impact the customer’s desires and contribute towards achieving a 22% increase in website inquiries by the next eight months.

3. Direct marketing

This communication tool entails directly marketing the product without having to involve third-party participants (Ling 1998 p 74). Direct marketing will occur through emails, phone calls, social media posting, and also through website blogs. Direct marketing will target the population aged between 30 to 50 years old and especially those with children between 10-15 years.

This strategy will play a crucial role in increasing the number of website inquiries and also help attain the 20% target awareness by the next eight months. Direct marketing will entail direct messages about the new product set to be launched and its specifications. The straightforward marketing strategy will also ask customers to register to the official website to get access to more information.

3. b) Metrics for Measuring the effectiveness

According to Jiang and Yao (2018), effectiveness is defined as the ability to achieve the desired outcome or produce the desired result.

To assess the effectiveness of the communication campaign plan, it is crucial to use various metrics. These metrics will range from website to digital channels and will be essential in measuring whether specific objectives have been met (Rust et al., 2004, p 78). These metrics include;

1. Percentage number of customers visiting the website.

This metric will be a crucial determiner of the extent the communication has impacted the population. It is measured as a percentage and depicts the total number of customers (existing and also new customers) who visit the website after having conducted an intensive market campaign (Rust et al., 2004, p 81).

Determining the percentage number of customers within a given period will act as a crucial determiner in deciding the extent to which the information has reached. The company targets to record a 22% increase in the number of new website visits within the next eight months. To effectively measure this target, the company will use platforms such as Google Analytics (Plaza, 2011, p 477). The platform will show the total number of website visits and also give the average timespan customers spend on this website. A high number of new customers indicate an extensive, effective communication campaign.

The measurement will be crucial in supporting future campaigns. This could be through the provision of links that will be shared through social media platforms and WhatsApp. The extensive sharing of the website link will increase the number of website views and thereby increasing the chances of viewing more products. The company should also make the website engaging to increase the duration customers spend.

2. Total number of Facebook followers and likes.

The company aims at acquiring 10k new Facebook followers after having conducted an intensive market campaign. To measure the effectiveness of the campaign, the number of new followers will be counted. The number of active customers interested in the products will be estimated by determining the number of views per social media post.

Social media has, in recent times, become a prevalent technique for promoting products. C&L Wheels intend to use social media and especially Facebook, to market its products. Facebook will play a crucial role in reaching the target population aged between 30 and 50 years. To determine the effectiveness of the market communication campaign, the number of Facebook followers in a specific period will be selected and measured as per the set targets of 20k new customers in 8 months. The measure will also include several views in the posted videos and photos. This will be crucial in determining the extent the information has reached and the actual number of people who have been aware of the new product to be launched. To measure the effectiveness of the communication plan, various analytical and monitoring platforms will be used; these include Sprout Social and Facebook Insights (Houk, and Thornhill, 2013, p 374).

Having seen the importance of the social media metrics in determining effectiveness, it will be crucial to take measures to increase the future efficacy of social media. In the future, it will be vital to use celebrities to market the products and post them on the company’s Facebook page. Using stars will increase the number of views and likewise increase the number of new followers.

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