Final Paper: Integrated Marketing Strategy. 4
2.0. Product or Service Description. 5
2.1.0. Need the product or service will meet in the marketplace. 6
2.2.0. Where it fits in the product life cycle. 6
3.2.0. Distribution Channels. 8
3.3.0. Application of 7P’s Marketing Strategy. 9
4.1.0. Product or service differentiation. 12
4.2.0. Porter’s Five Forces Competitive Market Analysis. 12
4.2.1. New market entrants. 12
4.2.2. Threat of substitution. 12
4.2.3. Bargaining power of customers. 13
4.2.4. Bargaining power of suppliers. 13
This paper comprises of a comprehensive analysis of the marketing strategies upon which Borrow My Tools company focuses on utilizing to ascertain market penetration and competitiveness. This is based on the execution of running the initiative for tools and equipment renting business opportunity. The tools and equipment rental service is a competitive opportunity which is informed by the growing need to provide and access variety of tools meant for single use in the construction industry than purchasing. The opportunity to rent the tools and equipment used in the construction is a profound chance to save the potential costs incurred in purchasing of the tools. In most cases, the construction tools and equipment are expensive bound to induce a high price on any construction should the contractor or builder aim at buying the tools every time. As well, the availability of such services provides an opportunity for contractors and potential builders access to quality and diverse tools and professional guidance on the use of the tools for various purposes. Therefore, the integrated marketing strategies captures the profound importance and opportunity created by availability of tools and equipment renting services for construction purposes.
The integrating market strategy applied in this case consist of the use of the 7Ps marketing mix which provides extensive analysis of every aspect involved in the product or service and its promotion to uses. The analysis of the target market and distribution channels is fundamental to enhance the understanding of the marketing mechanisms that guarantee the success of the business opportunity. These provide crucial competitive advantage upon which the company can utilize to gain a competitive edge and ascertain customer satisfaction. As well, this creates room for the development of loyal customer base and good reputation for the company as one where customers can always come for creative solutions.
Furthermore, the competitive market analysis is included in the integrated marketing strategy plan. This is critical to create clear understanding of the market upon which the company aims to venture into and posit to gain a competitive market share. The competitive market analysis is essential to ensure the company does not enter into blind folded and risk losing millions of investment in the venture. Therefore, the Michael Porter’s Five Forces model is utilized for thorough analysis of the competitiveness of business and market environment of tools and equipment renting services. Thus, this is critical to provide a roadmap upon which the business initiative should be implemented to attain the set objectives.
The proposed service comprises of tools and equipment renting used for construction and home improvement projects. As a business opportunity, the tools and equipment renting is an initiative that seeks to fill in the huge market gap in which it can provide potential customers with professional tools used for construction. The variety of tools and their precise purposes in the construction is a huge opportunity upon which customers can readily access (Mudzanani, 2015). The initiative seeks to substitute the need to purchase tools especially the ones required for single-use. Tools and equipment renting services provides customers with an alternative to rent the tools instead of spending much money in purchasing of the same tools. The initiative is a great savior to contractors and residential individuals that seek to conduct home improvement projects. This helps save or cut down the expenses used to successfully complete a construction project.
The needs of the service in which the tools and equipment renting seeks to meet in the marketplace is to help customers cut down on the construction costs. This is facilitated by the availability of all construction tools and professional guidance on the proper use of tools. The big contractors, subcontractors, and individuals seeking to improve their residential areas and implement construction projects have access to quality tools (Duralia, 2018). The variety of tools is critical to meet the needs of the customers in the marketplace in that it provides an avenue where instead of purchasing one can spend much less to access the same tool or equipment required in the construction. The lack of availability of similar service but existence of a huge market demand indicates a profound opportunity upon which the business can fill to satisfy the marketplace needs. The costs of buying tools and equipment for single-use and implementation of do-it yourself projects is extensively high (Laurie & Mortimer, 2019). Therefore, Borrow My Tools with the tools and equipment renting services is integral to fill the marketplace demand vacuum and efficiently provide creative solution to customer and market needs.
The provision of the tools and equipment renting service strategically fits with the product life cycle. The market demand for the availability of such tools shows a huge appetite in the construction industry. As a continuously growing industry; contractors, subcontractors, and individuals seeking to run diverse construction projects in the area have access to available tools and equipment. As well, professional guidance on proper usage of the tools is integral to successful projects (Gómez & Pérez, 2018). The establishment of local distribution centers is vital as it brings the services closer to the customers. This implies that customers can readily, effectively, and reliably access any tool which is required for construction purposes. Therefore, the service fits at the heart of the product life cycle of construction projects. Thus, marks a profound opportunity that mitigates costs and projects implementation process.
The success of the business initiative and market penetration highly relies on the efficiency of the integrated marketing strategy. The marketing strategy has been formulated as an initiative intended to pave the way for the implementation and market penetration of the tools and equipment renting service. This shows strategic selection of areas where the distribution centers are located, accessibility of customers, and analysis of the target market segment (Mudzanani, 2015). The understanding of the target market segment is vital to clearly understand the business and customer portfolios. This is fundamental to ensure the services provide creative solutions to a dire need in the market and set strategic opportunities in which the business can be expanded. Therefore, target market, distribution channels, and marketing strategies are further analyzed below.
The target market for the tools and equipment rental business opportunity comprise of residential individuals seeking to completing tasks and home improvement projects. The residential individuals provide a huge market opportunity for individuals that require do-it yourself tasks in the construction industry (Laurie & Mortimer, 2019). These are crucial customers as they are large in numbers and often available from time to time. The residential individuals are a critical target market as they require tools often for single-use. Hence, renting instead of purchasing is a crucial opportunity to cut down on the costs that would be incurred in executing a home improvement project such as kitchen remodeling, interior designs improvement, or exterior theme changes. Also, the availability and access to professional guidance on proper usage of the tools is vital to convenience the target market the value of renting tools and equipment from the company.
The contractors and subcontractors in the area provide a huge market opportunity for the tools and equipment renting business. What makes the contractors and subcontractors a prime target market and customer is their need to maximize profits by cutting down the construction costs. The purchase of tools consumes a huge chunk of funds and may not be sufficient to acquire all the necessary tools. The alternative to rent instead of purchasing is a profound opportunity to maximize on the gains of the construction venture (Duralia, 2018). This allows the contractors and subcontractors regularly renting tools and equipment from the Borrow My Tools company an opportunity to build a rapport for business relationship. As a result, this can be utilized for the benefit of both. That is, the contractors and subcontractors can negotiate for price regulation and fare discounts while the company can negotiate and influence customer loyalty and brand recognition.
The distribution channels help bring customers and the company closer. This is critical to build a reputation of meeting the market needs whenever required and maintenance of quality services. the distribution channels are strategically selected and established to ensure that customers have access to the company and the tools and equipment required for rental services with ease. The ease of accessibility creates profound reliability on the company that it can be utilized whenever there is a construction need (Gómez & Pérez, 2018). The local distribution centers comprise of the channels that link the customers to the company. All key areas that have been strategically identified have a local distribution aimed at bringing services closer to the people. This ascertains that the customers can readily access any tool at any given time with as much ease as possible. Therefore, the efficiency of the distribution channels enhances the reputation of the company.
This comprise of tools and equipment renting service. It is intended to fill the existing huge market gap of the lack of existence of firms offering such services. The capacity to enable customers with an opportunity to rent instead of purchasing tools and equipment used for construction needs is fundamental to projects’ implementation success (Samani, Hashemi, Shahbazi & Sarhadi, 2017). The services seek to enable customers cut down on project costs, access the relevant tools and equipment, as well as, professional guidance on proper usage of tools.
The pricing of the tools and equipment renting is maintained at standard price. This is meant to ensure that the customers are not prompted to pay a higher price for the tools. The approach is designed to help customers cut down on the project’s implementation costs (Yasanallah & Bidram, 2012). Therefore, the pricing for the tools and equipment renting will be offered at ten (10) percent the value of the tool. For example, it the value of hammer is $20, the renting fee is $2. This helps cut down the cost by $18 which is a huge amount that can be channeled to other needs in the construction project.
The Borrow My Tools company will establish strategic distribution centers that will bring services closer to the potential customers. This is intended to ensure that customers have access to the tools whenever required. The reliability and efficiency of the services offered is crucial to the success of the business initiative (Alnaser, Ghani, Rahi, Mansour & Abed, 2017).
The promotion of the new business venture will be implemented through various platforms. These include social media, radio and television channels, and the use of word-of-mouth among residents and construction firms (Rathod, 2016). The promotions are designed to offer first come basis opportunities and discounts. Also, the promotion accounts for regular customers to access substantial discounts and benefits for renting tools and equipment from the company.
All our agents in various distribution centers are expected to show due diligence and commitment to ascertain customer satisfaction. This includes individuals tasked with providing professional assistance and guidance on proper usage of tools (Jackson & Ahuja, 2016). The Borrow My Tools team is readily available whenever a customer is stuck or experiencing difficulties in using our tools.
The process of borrowing and returning of the tools is made to be as efficient and customer friend as possible. To acquire the tools, customers are required to issue the personal information and contact information. Also, an agreed contract to maintain the safety and proper conditions of the tools is signed. In case of damages, the customer is required to cater for the costs (Yasanallah & Bidram, 2012). The return process requires expert assessment of the condition of the tools. On approval, customers are issued with loyalty cards to allow them access discounts on the next borrowing.
The physical evidence comprises of the availability of the distribution centers as close to the customers as possible. Also, the availability of the professional team is integral to the execution of the project. Thus, customers are assured of safety and assistance whenever they run into problems (Alnaser et al., 2017).
The competitive analysis of the market is critical to allow the company adequately prepare for market penetration and acquisition of the market share. The competitive analysis provides insights in the market environment. This particularly revolves on what to expect and what to be ready for to ascertain the success of the business initiative.
The service differentiation is based on the assurance created on the availability of all tools and equipment used for construction purposes. The service differentiation streamlining is done on the basis of the analysis of frequently borrowed tools. Also, tools enquiry is used to update the list of availability in every distribution center. Therefore, this creates the assurance of availability and reliability of the company for any tool that may be required for construction needs.
The success of the tools and equipment renting services can trigger subsequent companies to start similar initiatives (Indiatsy, Mucheru, Mandere, Bichanga & Gongera, 2014). To ensure the company maintains a competitive edge, the assurance of customer satisfaction will be emphasized on every customer served by the company. Hence, credibility, reliability, and proper treatment of customers must be strictly adhered to through efficient services.
There is minimum or non-existence threat of substitution. This is a scarcely utilized opportunity in which Borrow My Tools company seeks to venture. The initiative is driven by the realization of the huge market gap to serve extensive needs (Peryan, Curak & Pavic Kramaric, 2018). The approach seeks to provide creative alternative of renting instead of purchasing prompting saving costs.
Customers are accorded a higher bargaining power especially the loyal ones. This is intended to attract and build a strong customer-company relationship that is vital for long-term operations (Omsa, Abdullah & Jamali, 2017). Also, it is intended to create a positive reputation for the company in order to attract more customers.
Suppliers have limited bargaining power. The company has the freedom and capacity to purchase tools from different suppliers based on assurance of quality and high standards on the tools. Also, setting of better terms such as tools return and exchange is integral to the business decision making (Vruijl, 2018). Therefore, the company holds an upper hand in the bargaining power over the suppliers.
This determines the competitive intensity and attractiveness of the market. The tools and equipment renting services has low competitive intensity by high attractiveness in the market (Mathooko & Ogutu, 2015). This is based on lack of existence of companies offering similar services and availability of a huge market opportunity. Therefore, posits an opportunity to establish market positioning before others venture in to compete for the same market share.
The use of technology is a significant tool in the contemporary business environment. Technology is essential to ease on the processes and operations facilitating quality service delivery. As a service company, tools and equipment sorting and approval is a tedious task. The utilization of technology is crucial to successful services to customers. For example, the use of electronic inventory system (IES) is vital to sorting of the tools and equipment culminating in quality services and customer satisfaction.
The use of e-business is designed to provide customers with various platforms in which they can access the services from the company. the e-business approach comprises of the establishment of a website that will allow customers to view and borrow tools for various construction purposes (Laurie & Mortimer, 2019). The website will allow customers to create a business account which is used to rent tools and equipment on order. The customer is required to visit the website and place an order of the required tools. The order is completed on delivery of the tools from the company to the construction site.
The use of social media platforms is primary used for marketing and promoting of the services offered by the company. This is a fundamental initiative used to create awareness on the potential customers of the existence of such a company and the services offered (Gómez & Pérez, 2018). Therefore, most frequently used social media platforms include Facebook, Twitter, YouTube, and WhatsApp to create awareness on the services offered by the company.
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