Discussion of the Segmentation, Targeting, and Positioning Approach

Marketing management may be construed to be one of the success-critical aspects of the business studies as the same may include the consideration of several factors that are both internal and external to the business (Natural Evolution, 2018). A successfully designed marketing mix along with the promotional strategies may pave a long way towards the success of the business in the industry in the long-run. The present report focuses on the mark marketing strategies through segmenting, targeting and positioning (STP) of the product and relate the same with the pre-determined marketing objectives set for the given purpose. The report finally provides a summary budget for the execution of the marketing strategies and wraps up the discussion by way of concluding note.

The situational analysis conducted in the first part indicates that value proposition and product distinguishable factors are essential to achieving market potential in Australia. Bezawada & Pauwels (2013) mentioned that unlike other countries, the Australian customers are more aware of the product specification and willing to spend much for the better health care. Thus, the products claiming to be organic, but unable to show authentication might be an issue while targeting the potential customers.   

Type of Segmentation	Segmentation Criteria	Natural Evolution Target Customer Segment Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper
Analysis	Biodynamic Bakery products	Skin care products	Baby food (bakery and egg)
Geographic	Area and Population	South Australia, Victoria and Western region is booming in terms of population and tourism (Denver & Christensen, 2014). Thus, food-savvy customers can be attracted towards the organic products.	The average temperature is 22-300C, which shows a requirement of skin toning and moisturizing in, Victoria, Southern and Western territory	The new born babies are increasing by 1.8% yearly (Butov, 2015). Hence, apart from Queensland, other regions are to be taken into consideration for producing organic baby products.
Demographic	Age	25-65 years	16-70 years	3-12 years
Gender	Male and female both	Mainly women, some ratio of men also	Boy and girl both
Social status	Mainly family and young generation	Women, students, old people and young adults	Baby and children group
Income	More than 4000 AUD per month	Discounted offerings for students whose income ranges between 1000-2000 AUD per month Different range of skin care products for the working professional whose income ranges between 3000-5000 AUD per month. Specific product for the old age group and pension holders with added discount and coupons.	Driven by parents
Occupation	Working professional, Homemaker, Student, Business person	Retired personnel, Homemaker, Students, Working women group	School students
Psychographic	Values	People are more concerned about the organic certification to identify the authenticity	Concern about the quality of the skin care products and the allergic reactions	Higher concerned about the healthiness of the product.
Attitudes	Prioritizes on quality product with validation and willing to spend money for getting quality foods	Student group only focuses on pocket money and tries to switch one brand from another. All other segments prefer to spend money for skin care products	No compromise with the quality of food.
Behavioral	Benefit	All user segment targets vitamin and protein benefits from the organic products	Apart from student group, all user segments focuses on getting smooth and tighten skin from the organic product elements. Students are focused on cost effectiveness.	Ability to provide effective nutrition and protein value.
Usage	Everyday	Everyday	Everyday
	Occasion	Breakfast, dinner and special occasion such as ceremonies, parties, etc.	In house usage, after bath, and before sleeping, etc.	All day usage, no specific occasion.

Table 1: Market Segmentation

(Source: Created by author)

Target areas:

Victoria, South Australia and Western Region would be the primary target area, as the population and foot fall is increasing gradually. Song (2018) also stated that the national income for these states has increased by average value of 15% and consumers have become more concern about the health.

Target customer group: 

Working professional and families could be the primary target group for food items and beauty care products. Australian consumers are more interested checking the product certification before purchasing and shows lesser trust in cheap products (Urde & Koch, 2014). Thus, working professionals, corporate executives and families can be the primary target. However, for grabbing the beauty product market, students can be attracted towards the brand by offering discount coupons and a varied range of items. Finally, calcium and vitamin enriched products can be offered to the old people with promotional coupons to position in the selected target segments.

The overall organic market is estimated to reach AU$ 2 Billion by the FY 2018 (Australian Organic, 2018). Song (2018) stated that the main competitor is Bubs Australia Limited, who is primarily focused on Baby Food segment. On the other hand, the consumer confidence in organics is increasing sharply. As mentioned in figure 1, the consumers’ priority is:

• 83% chemical free product
• 75% additive free product
• 58% antibiotic free product and
• 57% GMO free product (Australian Organic, 2018)

In addition, the dominant players have positioning in supermarkets, while the alternative retail channels are also booming (Zia & Kumar, 2016).

Hence, the chosen brand can position on alternative retail channels followed by the supermarket channels. The product diversity awareness satisfying the perceived benefits through alternate marketing communication channel would also help in positioning the brand across selected target areas.

• To promote PR communication by 40% to aware consumer regarding the labeled organic product offered by Natural Evolution
• To introduce online retail channels to grab more than 50% of the consumers within FY 2022.
• To capture at least 65% organic product market share in Victoria and Queensland region by the end of FY 2022.

• To experience higher cash flow compared to its competitors and achieving more than 55% growth earnings within FY 2020
• To increase sales by 45% within FY 2020 in the Australian market
• To improve market value added for maintaining stakeholder’s commitment and welcoming greater investment for the brand.

The majority of the competitors offer dairy and baby products to the Australian consumers. However, the beauty care products are mostly exported to Asian and American regions (Salai et al 2014). Thus, bakery product lines, beauty care, egg and baby food can increase the brand attractiveness in an Australian and international market. In addition, Deeter-Schmelz (2007) stated that certified organic products could improve the consumer awareness and loyalty index.

a) Problem Statement

Price: 

Competitive pricing would be the primary agendas of the brand since the other marketers are offering at the lesser price, which enhances the question mark on the quality offered by the brands. The consumers are ready to spend on quality products. Thus, certified organic products can be offered with the premium pricing to attain optimum trustworthiness (Krstic & Becic, 2011). However, student groups and the senior citizen can be offered discounted pricing to attain the higher market share.

Place:

Alternative retail channels and supermarkets of Victoria, Southern Region and western areas would be the primary target of the brand. The government survey indicated that Victoria is the most consumed area for the organic products compared to Queensland (refer to figure 1).

Figure 1: Consumption of organic food by regions

(Source: Australian Organic, 2018)

 Kastberg (2015) also stated that the growth revenue can be doubled by employing these channels.

The promotional mix would be innovative so that all targeted customers can be attracted towards the brand. Janssen & Hamm (2012) mentioned that an organic certificate labeling can be a part of promotions to increase the consumer trustworthiness and loyalty towards the brand. Moreover, as the product is related to the healthcare segment and need for the regular consumption, a profound promotional mix can help the brand meeting the business objectives. The proposed promotional mix considering the degree of relevance is as follows:

Objective 1: Application of digital marketing:

• To improve the brand awareness as a producer and retailer by 45%, through the ‘Digital Advertising media’, with respect to the proportion of certified business operations (refer to figure 2)

Figure 2: Growing proportion of organic food retailer

(Source: Australian Organic, 2018)

Objective 2: Sales promotion:

• To employ ‘sales promotion’ through traditional and digital marketing in order to enhance the overall customer loyalty by 80%

Objective 3: Personal selling:

• To resolve customer queries about the product features by employing online and offline personal selling mechanism. It would help to enhance customer retention by at least 75%.

Objective 4: PR communication:

• To employ events as a brand building exercise through various areas such as corporate house, residential complex, leaflet sells near school and universities.
• It would help the brand improving the customer base by at least 40%.

Budgeting plays an important role in finalizing the marketing and promotional strategies through 4Ps of the marketing (Abdullah Saif, 2015). While preparing the budget the emphasis has been put on every element equally. However, it has been observed that the “product” and “promotion” have been two most crucial factors as compared to rest two (i.e. “Price” and “Place”) and hence the management may need to evaluate the budget on a regular interval in order to revise and match the same with the changing market conditions.

Conclusion: 

Based on the discussion and analysis performed in the preceding sections of the report, it may be concluded that the effective promotional strategies along with the pre-designed marketing mix may significantly contribute towards the attainment of corporate goals and objectives in most cost effective manner and thereby achieve the sustainability in the industry in the long-run.   

References:

Abdullah Saif, N. (2015). How does Marketing Strategy Influence Firm Performance? Implementation of Marketing Strategy for Firm Success. International Journal Of Innovation And Economic Development, 1(3), 7-15. doi: 10.18775/ijied.1849-7551-7020.2015.13.2001

Australian Organic, A. (2018). Australian organic market report. Retrieved from https://d3n8a8pro7vhmx.cloudfront.net/ofa/pages/74/attachments/original/1492724931/AOMR-2017-REPORT.pdf?1492724931

Bezawada, R., & Pauwels, K. (2013). What Is Special About Marketing Organic Products? How Organic Assortment, Price, and Promotions Drive Retailer Performance. Journal Of Marketing, 77(1), 31-51. doi: 10.1509/jm.10.0229

Butov, A. (2015). Organic Potato Product for Baby Foods and Dietetic Food. Indian Journal Of Science And Technology, 8(29), 55-78. doi: 10.17485/ijst/2015/v8i1/84226

Deeter-Schmelz, D. (2007). Personal Selling and Sales Management Abstracts. Journal Of Personal Selling & Sales Management, 27(4), 389-399. doi: 10.2753/pss0885-3134270408

Denver, S., & Christensen, T. (2014). Consumers’ Grouping of Organic and Conventional Food Products—Implications for the Marketing of Organics. Journal Of Food Products Marketing, 20(4), 408-428. doi: 10.1080/10454446.2013.807404

Janssen, M., & Hamm, U. (2012). Product labelling in the market for organic food: Consumer preferences and willingness-to-pay for different organic certification logos. Food Quality And Preference, 25(1), 9-22. doi: 10.1016/j.foodqual.2011.12.004

Kastberg, P. (2015). Promoting communication, participation, and learning with regard to organic food products: a communication theoretical approach. Ecology And Society, 20(1), 123-142. doi: 10.5751/es-07139-200103

Krstic, I., & Becic, S. (2011). Implementation of marketing strategy: Factor of competitive advantage. Marketing, 42(2), 118-126. doi: 10.5937/markt1102118k

Salai, S., Sudarevic, T., Djokic, N., & Pupovac, L. (2014). Marketing research for choosing the promotional message content for domestic organic products. Ekonomika Poljoprivrede, 61(2), 501-515. doi: 10.5937/ekopolj1402501s

Song, M. (2018). A study on the Repositioning Strategy for Competitiveness of Enterprise in Low-Cost Cosmetics Market. Asian Journal Of Beauty And Cosmetology, 16(3), 405-416. doi: 10.20402/ajbc.2018.0225

Supplements, H., buy, W., Flour, B., Pizza, P., Juice, W., & Starch, R. et al. (2018). Natural & Organic Superfoods In Australia | Natural Evolution. Retrieved from https://www.naturalevolutionfoods.com.au/

Urde, M., & Koch, C. (2014). Market and brand-oriented schools of positioning. Journal Of Product & Brand Management, 23(7), 478-490. doi: 10.1108/jpbm-11-2013-0445

Zia, M., & Kumar, N. (2016). A Three Dimensional Vertical Differentiation Model: Implications for Segmentation, Targeting and Positioning. SSRN Electronic Journal, 3(8), 37-56. doi: 10.2139/ssrn.2758430