Marketing plan report

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Store to Door (S2D) is an interactive grocery delivery service that will shop and deliver groceries to its members. Members are able to place their grocery order by phone, website or by downloading S2Ds easy to use app for smartphones. Groceries will be delivered within 24 hours of placing their order. Members will have the option to pick up their order at the store or S2D will deliver to their preferred address.
Currently there is little to no competition in Erie County for a grocery delivery service. This is surprising since Erie County has a large market that would benefit from this service. Elderly residents, busy professionals, families, and college students would benefit from a grocery service.
Elderly residents may have trouble reaching stores in the area due to inclement weather or lack of mobility. These residents would benefit from a delivery service which is tailored to their needs and delivers right to their doorstep.
Time is valuable and no one is more understanding of that than busy professionals, families, and college students. S2D will save time and allow these members to devote their time to other activities that they enjoy.
With S2Ds unique partnership with local area grocery stores we will bring a much needed and wanted service to the Erie area. S2D is affordable, dependable and timesaving.

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Marketing plan report

  1. 1. Marketing 440 Sec 2Services MarketingProduced by:Group 4 Leslie Armstrong James Barber Nicholas Colella Olivia Derby
  2. 2. Store to Door Marketing PlanTABLE OF CONTENTSExecutive Summary …………………………………………………………………………… 2Service Description ……………………………………………………………………………. 3Environmental Analysis ……………………………………………………………………….. 3Competitive Analysis ………………………………………………………………………….. 5SWOT Analysis ………………………………………………………………………………... 6Market Analysis ……………………………………………………………………………….. 7Market Segment ………………………………………………………………………………... 8Perceptual Map ………………………………………………………………………………... 9Proposed Position …………………………………………………………………………….. 9Target Segments ………………………………………………………………………………. 9Service Product Description ………………………………………………………………….. 11Distribution Channels ………………………………………………………………………… 11Integrated Promotional Plan ………………………………………………………………….. 12Pricing Analysis ………………………………………………………………………………. 14Cost Analysis ………………………………………………………………………………….. 14Pricing List ……………………………………………………………………………………. 15Break-Even Point …………………………………………………………………………… 15Appendix A-Factor Impact For Service Businesses …………………………………………… 16Appendix B-Competitive Analysis …………………………………………………………….. 17Appendix C-SWOT Matrix …………………………………………………………………… 18Appendix D-Population Break-down and Income per Household ……………………………. 19Appendix E- Website Screen Shot ……………………………………………………………. 20Appendix F-Mobile App………… …………………………………………………………… 21Appendix G-Facebook page…………………………………………………………………… 22Appendix H-Billboard……. …………………………………………………………………… 23Appendix I-Print Ad …………………………………………………………………………... 244/13/2012 Page 1 of 24
  3. 3. Store to Door Marketing Plan EXECUTIVE SUMMARY Store to Door (S2D) is an interactive grocery delivery service that will shop and deliver groceries to itsmembers. Members are able to place their grocery order by phone, website or by downloading S2Ds easy touse app for smartphones. Groceries will be delivered within 24 hours of placing their order. Members willhave the option to pick up their order at the store or S2D will deliver to their preferred address. Currently there is little to no competition in Erie County for a grocery delivery service. This is surprisingsince Erie County has a large market that would benefit from this service. Elderly residents, busyprofessionals, families, and college students would benefit from a grocery service. Elderly residents may have trouble reaching stores in the area due to inclement weather or lack ofmobility. These residents would benefit from a delivery service which is tailored to their needs and deliversright to their doorstep. Time is valuable and no one is more understanding of that than busy professionals, families, and collegestudents. S2D will save time and allow these members to devote their time to other activities that they enjoy. With S2Ds unique partnership with local area grocery stores we will bring a much needed and wantedservice to the Erie area. S2D is affordable, dependable and timesaving.4/13/2012 Page 2 of 24
  4. 4. Store to Door Marketing Plan1.1 SERVICE DESCRIPTION Store to Door (S2D) will offer an interactive grocery shopping experience. Members of S2D will be ableto grocery shop without leaving the comfort of their own homes. Members will be able to create a shoppinglist and order their grocery items by phone, online, or by using the S2D app for smart phones. Once theirorder is placed a S2D grocery specialists will shop for their items. Members can chose if they want to pick uptheir items at the store or S2Dwill deliver the items to the members preferred address. S2D eliminates the need for senior citizens to maneuver massive grocery store parking lots and drive whenthe weather is poor. Mothers will no longer have to lug their small children from the car to the store in therain, snow and ice. College students will no longer have to break from their studies to grocery shop. Busyprofessionals will come home after a long day of work to find their groceries on their door step.S2D will eliminate the dreaded chore of grocery shopping. No more waiting in line.This service was chosen to review due to group interest. The group felt that shopping for groceries was oneof the most undesirable chores we complete.1.2 ENVIRONMENTAL ANALYSIS Social/Cultural Changes:  Baby Boomers (generation born between 1946-1964) have started to retire in 2011. As the population of Erie ages they will be looking for convenience services such as grocery delivery.  As more women enter the workforce there is a need for an “extra hand” with the household duties.  Due to the economy some working professionals are under employed and often need two jobs to bring home the same salary that they use to make prior to the recession. These professionals are looking for time saving services.4/13/2012 Page 3 of 24
  5. 5. Store to Door Marketing Plan Business Trend Changes:  As the economy struggles to move out of recession consumers are tightening their budgets. They may not have the budget for services that they can accomplish themselves. Information & Technology Changes:  When consumers do purchase services they are looking for more information on the services they purchase. They are also looking for the latest technology to accomplish tasks. Web and app services will need to be fast and work as expected each time a consumer places an order. Software will need to be up to date and maintained. Globalization Changes:  With civil unrest in the Middle East and an empowered Iran gas prices have been steadily rising. This will negatively impact our delivery business with higher fuel charges. A charge we may have to pass along to the customer. Government/Political Changes:  As government pressure increases for less CO2 emissions, a push for alternative energy, and pressure to decrease in the use of fossil fuels will impact the delivery portion of our business. The government may decide to increase the price of fuel or increase taxes on small businesses using fossil fuels.  Government mandated healthcare may impact our service business. Small businesses may have to provide healthcare to all employees. This would be an enormous cost to the business.A summarized version of the environmental analysis is provided in appendix A under Factor Impactfor Service Businesses.4/13/2012 Page 4 of 24
  6. 6. Store to Door Marketing Plan1.3 COMPETITIVE ANALYSIS The competition for our service will come from four main areas; brand competition, service productcompetition, budget competition, and do it yourself. There will be some indirect or substitute competition forcompanies such as Schwan Food Company who deliver groceries and food services to the home, andtraditional grocery store models. Our service, however, will offer a different shopping experience thananything available currently. The first type of competition is brand competition which is competition from similar product or servicebut with different companies, such as Coke-a-Cola vs. Pepsi. Because our service is unique by having noother company offer what we do, brand competition initially will not be much of a factor. If there is anybrand competition, it would come from Schwan Food Company because their service is the closest relation toours. Service product competition is completion that comes from the same service being offered. There again islittle service product competition because we are a unique service. The little competition that would bepresent would most likely be from grocery stores which do not have our service in them. We would need topersuade customers to use our service over using traditional methods of shopping. One of the biggest competitions we would be facing is budget competition. Many people try to keep costas low as possible when shopping so our service, which would cost a little extra, would have focus more onthe benefits in order to compete. The other major form of competition would be from “Do it Yourself”. Most everyone already does theirown shopping and has time already set aside for shopping. This will have to be overcome by convincingpeople that their time is valuable and our service makes shopping way more convenient.A summary of the competitive analysis is provided in Appendix B.4/13/2012 Page 5 of 24
  7. 7. Store to Door Marketing Plan1.4 SWOT ANALYSIS Strengths  We have excellent customer service available 24 hours per day 7 days per week.  Provide three options to customers when ordering. Phone, web or app. Weaknesses  Being a start up company we do not have a reputation in the area.  Employees may not be well trained or difficult to hire. Opportunities  Time is of value to most consumers.  Large number of people without mobility.  No competition.  Americans are time conscious.  Smartphones are popular and consumers would like using the app to order. Threats  Consumers may see the service as a luxury.  Consumers may not have the budget to use this service.  Competition will enter the market if service is successful.A summarized version of the SWOT analysis is provided in Appendix C under SWOT Matrix.4/13/2012 Page 6 of 24
  8. 8. Store to Door Marketing Plan1.5 MARKET ANALYSIS ERIE COUNTY Population Information  Population: 288,5661  Population Breakdown: See Appendix D Household Information  Households: 110,4131  Households with children under 18 years old: 30,0441  Male Households w/o wife present with children under 18 yrs old: 2,9291  Female Housesolds without husband present with children under 18 yrs old: 8,8961  Householders living alone; Male over age 65: 3,5251  Householders living alone; Female over age 65: 8,9571Income Information  Per Capita Income: $22,1922  Income Per Household: See Appendix DStudent Enrollment:  College Undergraduate as of 2010: 20,3333  Graduate, Professional School as of 2010: 4,06531 Source: U.S. Census Bureau, 2010 Census: (http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=DEC_10_DP_DPDP1&prodType=table)2 Source: U.S. Census Bureau, 2010 Census: (http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_10_1YR_DP03&prodType=table)3 Source: U.S. Census Bureau, 2010 American Community Survey:(http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_10_1YR_S1401&prodType=tabl4/13/2012 Page 7 of 24
  9. 9. Store to Door Marketing Plan1.6 MARKET SEGMENTSeniors – This market is going to want this service mainly due to their lack of mobility (such as troublewalking), and also because they may have a hard time finding all of the items that they need.PROS:-There is a growing number of baby boomers and it is on a steady increase.- People are living to be much older, and may be a loyal customer for years.- Most older people are having more trouble walking, therefore making our service more useful to them.CONS:- They may not be able to drive in order to pick up their groceries.- Some may even forget that they placed an order, and not show up to receive items.- Their kids may do the shopping for them already.- They may be in a retirement home, where they don’t need groceries.College Students: This market will greatly appreciate our service due to lack of time they have to groceryshop.PROS:- There is a large group of college students in Erie County.- Most use their parents money, and will buy a lot more groceries than most consumers.- College students don’t have a lot of time to spend in grocery stores.CONS:- They may make prank calls and waste our time, which leads to missed profit elsewhere.- Their peers may make comments about them using this service.- They might bring groceries back from home, and not need to shop while at school.- College students may have a meal plan and may not need other groceries.Families: This group also has a lot of responsibilities and may not have enough time to go grocery shopping.PROS:- The divorce rate is getting higher, which leads to the population of single mothers increasing.4/13/2012 Page 8 of 24
  10. 10. Store to Door Marketing Plan- They require a large amount of groceries for their kids.- They are likely to become loyal customers if they like our service.CONS:- Single mothers may have a nanny that can go shopping for them, or watch the kids while she shops.- They may not have the extra money to spend on our service.2.1 PERCEPTUAL MAPOur service currently does not have any competitors. We are a start-up business and we are the first toprovide this type of service. Since we cannot create a perceptual map we will explain how we will create aperception of our service.We want people to perceive our service as very convenient. We believe this is the most importantcharacteristic. Our team also views price as an important variable, especially now in our time of recession.Our customers should see our service as a great value to them, as well as close enough geographically tothem. We think that our customers should have easy accessibility to our service, and have that available tothem for a reasonable price.In summary, we would create a perceptual map using the following factors: Convenience/Price,Value/Location, Accessibility/Price, and Customer Service/Service Performance.2.2 PROPOSED POSITIONWe do not have the perceptual maps in order to provide our proposed position relative to competition.2.3 TARGET SEGMENTSThe S2D grocery service option eliminates the dreaded household chore of grocery shopping. Rated high asthe most disliked household chore, grocery shopping is time consuming, tedious, and tiresome. Our servicewill eliminate this activity for stressed college students, over worked professionals, busy families, and thesenior markets.The key market segments for grocery services as follows:4/13/2012 Page 9 of 24
  11. 11. Store to Door Marketing PlanCollege Students: In Erie County there are approximately 25,0001 college or graduate students. Highlyfocused on their studies these students do not have the time to shop and cook for themselves. Thesestudents can use our technology to order their grocery needs in an easy convenient way right from theirsmartphone or computer. These students will be eating healthier while saving time.Professionals/Work Force: There are approximately 125,0003 employed individuals in Erie County. Theseindividuals are busy, juggling home chores with work-loads and family lives. Seeking to stretch more freetime into their busy schedules these consumers would benefit from grocery service.Busy Families: Over 30,0002 households have children under the age of 18. Time is also limited for thesefamilies. Between school activities, their children’s social lives, and family chores these households arelooking for time saving services. With a grocery service busy families do not need to drag their youngchildren in and out of the car during rain or snow storms. Instead the family can stay warm and cozy in theirown homes while their groceries delivered to them.Seniors: There are over 11,0002 residents over the age of 65 in Erie County. Grocery shopping can bedifficult for this segment of the population. For seniors it is more difficult to physically navigate the largeparking lots and the mammoth stores. The weather in Erie also provides a challenge. Some seniors do notwant to venture out of their homes and risk dangerous road conditions when the weather is poor.Our focus for the grocery service would be college students, families, working residents and seniors. With theexception of the college students, we will focus on households with incomes over $50,000/year. This is 43%of the 109,388 households in Erie County or 47,000 households.1 Source: U.S. Census Bureau, 2010 American Community Survey:(http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_10_1YR_S1401&prodType=tabl2 Source: U.S. Census Bureau, 2010 Census: (http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=DEC_10_DP_DPDP1&prodType=table3 Source: U.S. Census Bureau, 2010 American Community Survey.(http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_10_1YR_DP03&prodType=table)4/13/2012 Page 10 of 24
  12. 12. Store to Door Marketing Plan2.4 SERVICE PRODUCT DESCRIPTIONOur service is a shopping helper service. For many people, there is not enough time to do your day to dayactivities and do all the grocery shopping. This is why our service will do the actual shopping for you insidethe grocery stores that you preferably shop.Our service will start with the customer browsing a store’s many items and adding them to the customer’svirtual shopping cart via our mobile app or our website at the customer’s convenience. Our shoppingrepresentatives will receive your order at the location of the customer’s choosing along with his/her desiredpickup time and they will go throughout the store gathering the items the customer have selected. When allof the items have been collected, the groceries will be waiting at the pickup center outside of the store at thetime specified for pickup.The pickup will be very quick and easy. There will be no need for money to change hands at that momentbecause the account will be charged when the order is placed, minimizing the time at pick up. We guaranteethe groceries will be freshly taken from the store and stored in an appropriately conditioned area to preventspoiling and rotting of sensitive products.2.5 DISTRIBUTION CHANNELSOur distribution channels will all be located at grocery stores. Our business will work along side the alreadyexisting grocery stores by adding a more convenient way to shop. We will have our own employees working inthe various store locations doing the shopping. Because we will have locations at many stores, customers willhave access to more products and they can choose the most convenient location for them.For our customers, they will be able to access our service either from a mobile app or our website. Both ofthem will have the ability to show all available products, allow the customer to choose a pickup time and payfor the groceries and service. This will allow for the customer to do his/her shopping at their convenience.4/13/2012 Page 11 of 24
  13. 13. Store to Door Marketing Plan3.1 INTEGRATED PROMOTIONAL PLANPROMOTIONAL PLANTo reach the target market, S2D will produce the following materials:Website (Provided in Appendix E)Facebook Page (Provided in Appendix G)TwitterSales BrochurePrint Ad (Provided in Appendix I)WEB PLANThe S2D web site will offer information for current members and for potential members. The web site willhave complete information on how to use the S2D membership as well as the S2D app, membership andusage costs as well as the benefits of using the service.The web site will include the following information:  Membership Fees  Service Rates  Customer Service Contacts  Services  Delivery Options  FAQs  App Download  Calendar  Membership formThe website will target college students, working professionals and busy families. S2D will create its ownwebsite, Facebook and twitter account without costs to the company. The website will be marketed in thefollowing ways:  Facebook-we will use FB to add friends and access college accounts to add members  Twitter  Search EngineTarget goal of 500 new memberships in six months measured by new memberships.4/13/2012 Page 12 of 24
  14. 14. Store to Door Marketing PlanPersonal SellingS2D will sell our service to local grocery stores in the Erie area (B2B). Partnering with local stores willimprove customer service, allow for store pick up and allow S2D access to store coupons and discounts. S2Dwill improve store sales and give consumers choice for shopping. Personal selling information will include:  App instructions  Expectations for increased store sales  Sales Packet Personal selling will target local area grocery store chains. Target goal of all major grocery chains obtained in 6 months measured by store agreements.Print AdOur print ad will target seniors, busy professionals and families. The print ad will be used in local Eriemagazines such as Lifestyle and the Erie chapter of AARP magazine. This ad will also be featured in the ErieTimes. To reduce the risk that may be associated with our service we are offering free delivery for the firstpurchase. We will also reach out to our target market by placing billboards in strategic locations in the Erie.S2D’s print promotional advertising will include the following:  Billboard (See Appendix H)  Print Ad (See Appendix I)The print ad will target all segments of our market by reaching out to prospective members at locations theyare most likely to be. With this ad and featured promotion, our objective is to get the local shopper to tryour service to see firsthand how easy and convenient our service is. This is the most effective and low costpromotion of our service. We expect this promotion to compel consumers to try our service at least once byoffering free first time delivery. This promotion will be measured by the number of new memberships andthe free delivery code. We will be able to quantify how effective this promotion is by seeing the percentresponse rate with increase in new memberships.4/13/2012 Page 13 of 24
  15. 15. Store to Door Marketing Plan4.1 PRICING ANALYSISS2D’s closest competitor is Schwan’s home delivery service. While Schwan’s is not a direct competitor toS2D since Schwan’s does not offer local grocery store items, we have listed the competitor pricing as follows: Schwan’s Home Store-2-Door Delivery Orange Juice-192oz $11.99* $7.47* Strawberries- 2 lbs $7.67* $5.00* Pizza-serves 8 $7.70* $5.49* Fettuccini Alfredo-serves 2 $10.48* $5.00* Delivery Charge $1.79* $10.00* Total $39.63 $28.01 * prices based on Schwan’s web prices as of 3/28/12. (www. http://www.schwans.com/products/categoryDetail.aspx?c1=11452&c2=9434) Store to Door prices based on Wegmans, Erie, PA as of 3/28/12. (http://www.wegmans.com/webapp/wcs/stores/servlet/ProductListView?forwardto=ProductListView&langId=-1&storeId=10052&catalogId=10002&N=207)4.2 COST ANALYSIS Labor Costs:Employees (This assumes labor is a fixed cost)3 Shopping Specialists1 Delivery Specialist1 Customer Service Specialist  $7.50/hr-In store shopping specialist  $7.50/hr -Delivery specialist  $7.50/hr-Customer service specialist  20% of payroll-Administrative/benefit costs Labor is based on 8 hour day (assumes no lunch or vacation) Other Expenses:  $1,000/mth-permission to have specialists in stores and store pick-up  $250/mth – delivery truck payment (includes gas)  $1,000/yr – insurance  $5,000/yr – advertising  $500/annually - equipment4/13/2012 Page 14 of 24
  16. 16. Store to Door Marketing Plan4.3 PRICING LISTTime to complete tasks:  ½ hr = time per order  ½ hr = delivery timeFrequency of tasks:  7 days a week, 52 weeks per year = frequency of grocery delivery  Estimated current orders: 35 orders per day  Estimated current deliveries: 12 per day  Estimated members: 1,000 per monthCurrent pricing:  $20 per month membership fee  $10 per trip delivery fee4.4 BREAK-EVEN POINTLabor Costs= $109,200Admin Costs= $21,840Other Expenses= $21,500BREAK-EVEN POINT: $152,540Revenue = $283,680Net Income = $131,140MAX OUTPUT:Membership fee: $282,240Delivery: 58,240Total: $340,4804/13/2012 Page 15 of 24
  17. 17. Store to Door Marketing Plan APPENDIX A Factor Impact For Service Businesses Factor Changes ImpactSocial/Cultural -Baby Boomers Retiring -These factors will impact our -More Women in the services in a positive way. With Workforce more people retiring, more women entering the workforce and with -Under employment more people in the workforce under employed they will all be looking for low cost services to save them time.Business Trend -Current Economy -Due to the decline in the economy people may not want to pay for a service they can complete themselvesInformation & Technology -Consumers are more tech -Need the most updated technology savvy and looking for the latest that is easy to use which may be technology to perform tasks expensiveGlobalization -Unrest in oil producing -This may cause a rise in fuel prices regions that will be passed on to the customer in the form of higher prices.Government/Political -Push for alternative fuels -These factors could raise the cost of -Government mandated doing business healthcare laws -Increase in taxes on small businesses 4/13/2012 Page 16 of 24
  18. 18. Store to Door Marketing Plan APPENDIX B Competitive Analysis Schwans Food Service Grocery Store Neighbor or relative DIY4/13/2012 Page 17 of 24
  19. 19. Store to Door Marketing PlanAPPENDIX C SWOT MATRIX STRENGTHS WEAKNESSES -Excellent Customer Serivce -No reputation -Numerous Ordering Options -Untrained employees -Open 24/7 -Employees diffiuclt to hire OPPORTUNITIES THREATS -Time is valued -Service seen as a luxury -Lack of mobility -Competition entering the -Little/No Competition market -New technology making -Smaller consumer budgets service easier4/13/2012 Page 18 of 24
  20. 20. Store to Door Marketing Plan APPENDIX D Population By Age Group 25000 20000 Population 15000 10000 5000 0 30 to 34 years 5 to 9 years Under 5 years 10 to 14 years 15 to 19 years 20 to 24 years 25 to 29 years 35 to 39 years 40 to 44 years 45 to 49 years 50 to 54 years 55 to 59 years 60 to 64 years 65 to 69 years 70 to 74 years 75 to 79 years 80 to 84 years 85 years and over Age Group Source: U.S. Census Bureau, 2010 Census Source: (http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=DEC_10_DP_DPDP1&prodType=table) # of Households In Income Range 25,000 # of Households 20,000 21,136 15,000 14,571 14,308 10,000 12,282 12,458 11,991 10,700 5,000 7,762 2,094 2,086 0 # of Households $100,000 to $149,999 $150,000 to $199,999 $200,000 or more Less than $10,000 $10,000 to $14,999 $15,000 to $24,999 $25,000 to $34,999 $35,000 to $49,999 $50,000 to $74,999 $75,000 to $99,999 Income Range Source: U.S. Census Bureau, 2010 Census Source: (http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=DEC_10_DP_DPDP1&prodType=table)4/13/2012 Page 19 of 24
  21. 21. Store to Door Marketing Plan APPENDIX E - Website4/13/2012 Page 20 of 24
  22. 22. Store to Door Marketing Plan APPENDIX F – Mobile App4/13/2012 Page 21 of 24
  23. 23. Store to Door Marketing PlanAPPENDIX G –Facebook page4/13/2012 Page 22 of 24
  24. 24. Store to Door Marketing PlanAPPENDIX H –Billboard Promotion4/13/2012 Page 23 of 24
  25. 25. Store to Door Marketing Plan APPENDIX I – Print Ad4/13/2012 Page 24 of 24

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