Situation Analysis using PESTEL Analysis

Question:

Write an essay on marketing plan to launch a new product for Oxfam shop.

The primary aim of the report is to develop a marketing plan to launch a new product for Oxfam shop. The report firstly forms a situation analysis of the firm and the product to understand the external and internal factors that affect the marketing of the product. Pestle analysis is used to analyse the macro environmental factors affecting the product. The goals and objectives f the firm is set by using the four Ps of the marketing mix strategy that is place, product, promotion and price. The marketing plan further consists of competitor analysis and Swot analysis to understand and examine the strengths and weaknesses of the firm or the product. The main objective of the marketing plan is to launch a new product for Oxfam shop in the market of Australia.  It is also very important to understand the market segmentation and its customer target before launching any new product in the market. Marketing is the activity of the company that involves buying and selling of the product  through advertising, promotion and delivery. The success of the company  and the product greatly depends on the marketing strategies and plan that the company formulates. Oxfam shop is a non profit organization that aims at social welfare maximization. Its main aim is to provide the goods to the customers that are eco friendly in nature. It mainly produces the gift items from the recycled products to utilize the scarce products to the fullest without harming the environment. The Oxfam shop plans to launch a pencil case made out of cotton clothes and recycled. So the main aim of the report is to formulate a marketing plan to promote and sell the product launched by the company (Hollensen 2015).

Oxfam shop in Australia is the subsidiary unit of Oxfam shop. It is an independent and secular non profit organization that is based for the community development. Its main aim is social welfare maximization. The founder of the firm is Gerard Tucker and it was founded in the year 1953. The CEO of the company is Helen Szoke and its parent organization is Oxfam. It operates in a highly competitive retail market of Australia. The shop is registered as a Fair Trade Organization that aims at providing the services and products to the disadvantaged group of people at fair prices. The company is also involved in selling its product online or through direct mail.  The company is involved in producing and providing many products at fair prices that includes food items, gifts and toys, art and crafts and cloths and many other products. Many small retailers purchases the products from theses shops at fair price to sell them. The company faces many challenges as it has many competitors in the market. So in this globalised proper formation of marketing strategies is essential in order to survive specially for launching the new products. The company has launched many new products recently such as neon bracelets, gift items, scarf’s and  leather diaries (Oxfam shop 2016).

Market Segmentation and Customer Target

There are many factors internal and external factors that affect the industry and its products in the market. The situational analysis can be conducted by using pestel analysis. The macro environment factors are uncontrollable by the organization.

Pestel analysis is the component of strategic market planning that is used to analyze and examine the external factors affecting business or the market of the company. It is a  framework of macro environmental factors that affects the brand and the product in the market. Pestel as the name suggests includes four factors such as political, economic, social, technological, legal and environmental factors (Team 2013).

Political factors: the political factors affecting Oxfam in the business are the sex discrimination act, disability discrimination act and the national minimum wage act. Many government activities affects the working of the company such as tax policies, funding and other environmental laws.  Since Australia is politically stable the government activities and political factors does not affect the business (Wells 2015).

Economic factors: factors such as economic growth, interest rate, market size, tariffs and trade restrictions and inflation rate greatly affects the business specially during the time of product launch. If the inflation is high in the economy them people will have less money to purchase the product so the demand for the product will be low. Since the Oxfam shop is non profit organizations it success greatly depends on the growth of the economy. The position that the company hold also determines its activities. The salary of the donors are affected by the economic conditions of  the county (Wells 2015).

Social factors: social factors such as lifestyle of people. Behaviour, demography, age, sex, tastes and preferences and career attitudes also affects the business. The working of the firm greatly depends on the type of people that stays in the society. Since Oxfam is a charitable shop there are many social obligations that the company will have to face. Since the working of the non profit organization is determined by the availability of the donors in the market the company has to keep in mind the external factors while launching a product (Wells 2015).   

Technological factors: technological factors also affects the production of various goods and services in  market. Research and development, proper utilisation of resources,  technology and other aspects affects the market for the product. Oxfam’s indulge in producing goods using eco friendly techniques. It mostly utilizes the waste products to create a innovative product and make it available to consumers at free price (Wells 2015).

Legal factors: political and legal factors also affect the business and it varies from country to country. These includes the discrimination laws, consumer laws and employment laws (Wells 2015).

Environmental factors: weather, climate, tourism and other environmental factors affects the working of the product. The main aim of the company is to generate the best product out of waste and eradicate poverty (Wells 2015).

The major threat of any corporate house in the world is from its competitors. It is very essential for the businesses in the market to analyze the number of competitors it has in the market and the strategies of its competitors. A market plan is formed keeping in mind the strategies of its  competitors. Oxfam shop in Australia is a non profit organizations that operates in a very competitive retail market. The company aims to eradicate poverty around the world. It is an online retailer. Many online sites have come up recently that gives the customers an option to purchase product.  The major competitors of the company are Amazon, eBay, Hive, Flipkart, Amnesty international Australia and Australian conservative foundation. Before launching its new product it is essential for the company to know the strategy of its rival firm as in what prices are they charging for the goods, the process and operation that they use in their  industries and the cost at which it is operating. Oxfam is faces competition from cheap high street stores as well such as Primark. The strategy that will help the company to survive the competitor and its threat is to cut the prices of theory products and give valuable discounts and offers. The company needs to promote its products and causes and objectives in social media so that people are aware of the organization and the products that it sells. The organization also faces competitor from supermarkets such as Aldi. The number of donors donating various resources in the organization is falling down due to rise in the number of competitors and non government organizations in the market. The charity shops in Australia is facing high competition in the retail market in Australia (Upson et al. 2012).

Competitor Analysis

Market segmentation is another marketing tool that is used to divide the major market into target group of customers. It helps the companies target those customers only whom they think will purchase the product and will be beneficial to the organization. The customers are divided into groups and sub groups on the basis of interests, common needs and strategy. It is the process of dividing and identifying the homogenous market into segments that have similar taste and preferences. There are mainly four factors that influence the segmentation of market that includes demographic, psychographic, geographic, and culture. Market segmentation is a tool used to analyze the customers. The main target of the Oxfam organization is the disadvantaged group of people who cannot afford the products at high prices . The organizations provides its customers with goods a cheap prices to eradicate poverty. It believes in equality. Oxfam targets the customers across all over the world so that to can collect as much charity it can so that to can use for some good cause. For launching the cotton pencil cases it should mostly target on students across the world aged between eight to eighteen. Mostly female customers are interested in purchasing these products. The customers who are concerned of sustainability and believes in purchasing eco friendly products should be targeted. The main aim of the organization is to provide the products at fair prices so kits ain market segmentation consists of retailers who further plan to sell the product to earn profit. There are many benefits of knowing the target audience. Communicating becomes easier. The factors the influence the target audience are age, gender, income, types of products, lifestyle and culture. The target market of Oxfam organizations is people who live in poor conditions and is in need of help from all areas, religions and regions. The target market of the organization are also the people who love in injustice specially women and girls. It targets people who are price sensitive and is interested in purchasing whole range of products online from home decor to food items to handcrafts and toys for children (Solomon 2014).

SWOT analysis is used to analyze and identify the Strengths, Weaknesses, opportunities and threats of the company or the shop so that it can formulate the marketing plan accordingly. It is one of the essential tools of strategic planning. Oxfam is a non profit organizations so it has many strengths as well as weaknesses (Anheier 2014).

Strengths: Oxfam is a company with clearly defined goals and values. The goals and objectives of the firm are well defined. The organization also has great brand loyalty and credibility across the globe. It also produces wide range of products. It provides the products that are the basic needs of the consumers. The online presence of the organization is good and it also has price advantage over its competitors. The main strength of the non profit organizations is that they are exempted from tax.  The organization is well connected across the world which is the greatest strength of the company (Sargeant  and Jay 2014).

Weaknesses:  the organization is only known for its non profit counterpart and it also has less brand recognition as online retailer. It also does not provide luxury products. It has less global presence as a retail store. Most of the non profit organizations cannot cover up the cost due to which it has to face loss (Sargeant  and Jay 2014).  

Opportunities: the organizations should realize the opportunities that it faces and then formulate the strategies accordingly. The organization is more into advertising. It needs to communicate with its target audience thorough promotional activities (Sargeant  and Jay 2014).

SWOT Analysis

Threats: the main threats of Oxfam is from its competitors and volunteers. It has lack of volunteer and employee commitment. Lack of client motivation is also one of the weaknesses that the organization has.  The competitors provide quality products that the company is not able to provide (Sargeant  and Jay 2014).

The main aim of the organizations is to sell the product to raise fund to eradicate poverty. It aims at providing the products to the disadvantaged and poor section of the society at fair prices. The main aim of launching cotton pencil case is to utilize the countries resources and recycle it. The organization is a non profit organization that aims at maximizing the social welfare and gender equality. It produces the products to raise funds for the charity purpose. It is an online retail shop providing products at fair trade price. SMART analysis is a marketing tool used to set the goals and objectives of the firm using certain criteria and condition. Smart goals are developed on the criteria that it is  specific, measurable, achievable, relevant and time bound (Jobber and Ellis 2012).

Marketing mix is a tool used by the marketers to for a strategy for marketing. It is often comprised of four Ps that is price, product, place and promotion.

Products: products are the goods that the organizations provide on the demand of consumer to satisfy the needs of the consumers. Oxfam provides many products from range of household decor to foods to toys to gift items.  The main aim of the organization while launching new products should be to produce at a minimum cost and it should also be of great quality. The product that the organization is planning to launch a cotton pencil case (The Marketing Mix 2015).

Price: it refers to the value that is placed on the product provided by the organization. The main aim of the organization is to provide the product to its customers at fair price. The price of  the product depends on the cost of production of goods, various economic factors like demand and supply and pricing strategies. The main aim of the organization is to provide the products to its customer at minimum price (The Marketing Mix 2015).

Place: Place is the point of sale. The Oxfam organization is situated in many place. The Oxfam shop in Australia targets the local people of Australia to sell its products. Place is also sometimes referred to as distribution stage and is greatly influenced by the geographical factors and location (The Marketing Mix 2015).

Promotion: promotion is the way of marketing the product. There are various ways that the organization can use to promote its products such as social media, digital marketing. Direct sale, mail and others. The organizations should aim at promoting its product in  social media to increase its sale. When the company launches a new product advertising it in the market and to its target audience is very essential.

Marketing mix plays a very important role as all the elements influence each other. It is a tool used to formulate marketing strategy (The Marketing Mix 2015).

Conclusion:

Marketing is the tool to sell its products to target audience. The author analyzes the marketing strategy for Oxfam organization a non profit organization in Australia that aims at eradicating poverty and providing the products at fair price to the disadvantaged section of society. It believes in equality and targets the people who cannot afford to buy expensive goods. The organization provides basic consumer needs.

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