Target Market For Slendertone example essay topic

1. Describe the root causes of Slendertone's French sales revenue losses? ANS: All sales of slendertone were through distributors except of home-market. Since the investments being made in research and production, the company's marketing resources were very limited, they thought it could develop new market for Slendertone more cost-effectively and quickly. However, there were some poorly resourced and inexperienced distributors. In France, the company was concerned about the growing dependence on one distributor.

There are 5 main basis causes of Slendertone's French sales revenue losses listed below: f"U Increasing competition continued to put pressure on price: from 1993 to the beginning of 1996: drop the retail price to compete the other EMS products. f"U Lack of secondary data for the EMS product class, and the distributor reluctant to share sales data with Slendertone. : It's hard to to determine what market share different companies had. Also, lack of data made it difficult to determine the size of the existing market for EMS products in each company. f"U Lost the TV slot: the distributor had lost the television slot for the Gymbody 8 to cheaper product. f"U Tacky advertisement: Some advertising featured topless models alongside sensational claims for the products' effectiveness. f"U Distributor: in 1996 Slendertone decided to develop the UK market directly, without any distributor. The decision was made on the basis of the failure to attract good distributor in the past. That! yens very clear to know that the problem of distributor.

2. When O'Donohue arrived at Slendertone, he thoroughly researched customers reasons for purchasing Slendertone, losing weight or improving appearance. Why did he choose improving appearance as the message for men and women age 20 to 60 years. ANS: Through Mr. O'Donohue gathered data on consumer behaviors and motivations relating to those different markets, he built up a clearer picture of the markets for Slendertone and found out its brand positioning, product emphasis, market segmentation, target market. Market Segmentation Positioning Strategy for Each Target Marketing Program for Each Target Originally, Slendertone was defined as!

SS women between the ages of 25 and 55, ! "it's a few niche segments were targeted, including! SSprenuptials, ! "! SSpostnatals, !

" But by early 1999, the target market for Slendertone is a woman and men age 20 to 60 years. The earlier niche segments, such as the! SSpostnatals, ! " no longer are being targeted separately. Also, Male users now represent an important and fast growing market for EMS products. O'Donohoe believes it is important to keep the Slendertone message focused rather than having different messages for different segments of the market. We can use Product Markets Segmentation Bases to segment each target.

Why does he focus on women and men age 20 to 60 years? Because the person who between 20 to 60 needs social contact and have good looking. Moreover, they are able to purchase this kind of stuff. Furthermore, both of women and men may consider of! SS Self-confidence through improves appearance.!

" Since Slendertone had a very confused positioning: It was variously associated with dieting, weight loss, health, fitness, exercise, toning and body shaping, but all of elements are in order to improve appearance. The chart will describe this statements as fallow: 3. Why did he prefer retail stores as his placement for sales growth versus direct marketing? What is retail store? "c A store that sells products purchased by individuals for their own use and not for resale". c As opposed to wholesale, retail concerns the direct traffic routing between a carrier and the end user"c Merchants selling tangible goods in a face-to-face environment who normally use conventional terminals and swipe transactions. What is direct marketing?

" A marketing strategy that attempts to communicate marketing messages directly to individuals, rather than to market segment groups". A transaction category for providing customized services and procedures for merchants which offer merchandise or services via catalogs, telephone calls, mailings, and / or advertisements". The variety of approaches a marketer uses to promote a product directly to the buyer and elicit and immediate response. Includes direct mail, catalogs, telephone sales, TV, radio, or newspaper ads that usually invite consumers to call a toll-free number or fill out a coupon ANSWER: Direct marketing's disadvantage and problems: Legal restrictions- for example, DR television was not allow in Germany Cultural factors: for instance, Germany and Switzerland are more conservative than French, Spanish, and South Americans. For the reason, they may not to be interested in a product like Slendertone.

Save cost effectively and quickly: compare with Direct shop (charged high margin), they can save more cost. Slendertone wanted to attract new customers in a cost-effective manner using the retail stores as a new route to market. High return rates: the return rates of product from customers as hing as 35 percent, very often the outer packaging hadn't even been opened by the purchasers. Lower than expected sales, low margins: Direct shop operated on high margins which meant that BMR would get less than 25 percent of the 120 retail price for the products, however, the company was selling this product to other distributors for around 40. price war and price cut: In many case offering a price for the gymbody 8 was lower than what the distributors were charging for it locally.

The tension with existing distributors arose. By dealing with fierce competition, October brought a fresh rush of media spend as another product launched, then another, and another. Then, the first gadget to market was priced at $129, the next came out at $69.95, the last was retailing at just $39.95 - a quarter of the average price charged for Slendertone's. Making excessive product claims: the company was unlikely to meet customer expectations, and miss the opportunity for repeat purchases of slendertone products by existing customers. Traffic decided that Slendertone may focus on Franchising. Franchise means a license or similar legal authority to sell products and provide service of a large firm (such as Slendertone) at retail in a given geographic area.

The challenge presented to Traffic was to explore every route to market retail. Retail store's advantage: Develop new markets or redevelop previous markets- If there are more and more retail stores join to the Slendertone in the regional distribution even in the nationwide, that can develop new markets and result in some advertising and propagandizing effect of the brand. Greater company control: by maintaining! SS control of the message and offer training to all agents as well as merchandising support to display their Slendertone products. The franchisee (retail store) need to work the licensed property under the supervision and control of the franchisor (Slendertone) Built a strong brand image and advertising affect: For these retail stores Slendertone will represents a new category of good, with higher than average revenue. Once there are many retail stores with a display of whole new Slendertone range, alongside massagers and shavers and other personal care products that cause of a strong Slendertone image.

In the contrast, American TV channels and magazines were suddenly flooded with advertisements for electronic tummy-toning devices - the only hitch was that the ads didn't come from Slendertone. More retail stores are more advertising affect than direct marketing. Reduce return rate! V retail store does not only express a tangible product, but also is a challenge to educate the customer that there is a big difference between the products they bought and the one Complete repositioning of the Slendertone brand: A good distribution strategy can complete the entire repositioning plan.

Direct marketing vs. Retail store Through product characteristics, financial control consideration, and buyer consideration to analyze the direct marketing and retail store. Product consideration: it is tangible, a gadget, a unique access to the body-shapes section of appearance market Retail store: reduce return rat and explain the product directly. Direct marketing: The difficulty presented to Traffic was to explore every route to market online while building trust in a misperceived but proven product. Financial / control consideration: high quality high price accompany with making sales growth and achieve high margin. Retail store: a greater company control Direct marketing: direct shop charge high margin so that Slendertone are low profit. Buyer consideration: improving appearance to complete self-confidence.

Some people who may not buy directly but who got their initial product information, such as! "what is this! ", ! SSHow does it work! ", !

SSHow should I use! SS, ! "May I try on this stuff! "! K. Retail store can answer the question above, but direct shop can't. He recognizing the opportunity presented by the trial placements for the Gymbody 8 in various UK stores, he immediately focused on developing the company's relationships in the retail channel.

O'Donohoe states that the increasing emphasis on retail has to seen in terms of a complete repositioning of the slendertone brand. Moreover, he thinks that using Direct Shop was the worst thing ever for this company, and lots of exclamation marks, sensational product claims, very cluttered, and the models used! He believes in he is able to secure retail space from important multiples because he is offering them unique access to the body-shapes section of appearance market. However, the focus on retail does not mean an end to the use of direct marketing. 4.

Why does O'Donohue feel that Slendertone products don't have to lower their prices to meet competing brands? ANS: Through a strong brand identity and a carefully controlled and differentiated image, he intends to protect the Slendertone name and market form the activities of other EMS companies. He does not plan to compete on price with the lower-quality producers, he believes that by investing in the Slendertone brand the company will be able to offer the customer greater total value at a higher price. According to Price strategy, we can find out Slendertone is belong to A high-activity strategy. A high-activity strategy sometimes is used for prestige brands seeking an affluent image. When the buyer cannot easily evaluate the quality of a product, price may serve as a signal of value.

No one can deny that! SS the value is equal to price and quality! ". Besides, Slendertone have large market share in a mature period, with slow growing with profitable products industry. He should maintain price leadership in the EMS market. There are some main ideas will point out Slendertone's brand strategy listed below:"I Differentiated image- slendertone as being at the top end of the market, based on its superior quality and powerful brand name.

For the reason, Slendertone sould maintain their high quality and high price image to compete those low quality EMS company."I Build a strong brand identification- The profession market playing an important role in the development of slendertone. It needs to get away from the! SS gadget! " image and lead to profession market."I Control of message marketing information- to avoid a recurrence of what happened in the French market."I Innovation- To invent new product to prenuptial's, postnatal and men but not only for women."I Maintaining international operations and Creating a class world brand.