Acme Smoothies Uk Marketing Plan

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ACME SMOOTHIES UK MARKETING PLAN

Student’s Name

Professors Name

Course Name + Course Code

State/City

Date

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Executive Summary

This paper proposes a marketing plan for ACME Smoothies UK as the business moves into

the UK market. An analysis of the business as well its external environment were carried as

groundwork for the marketing plan. The smoothie market in the UK has been examined to

test the suitability of ACME in this market context. Further, applicable marketing strategies

have been brought forth to support the firm’s marketing needs. In the final section, a budget

and the expected revenues from this market expansion are laid out.

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Contents

Executive Summary ................................................................................................................................ 2

1.0 Introduction ....................................................................................................................................... 4

1.1 Background ................................................................................................................................... 4

1.2 Rationale ....................................................................................................................................... 5

1.3 Aims and Objectives ..................................................................................................................... 5

2.0 Internal Analysis ............................................................................................................................... 5

2.1 Strategy Audit ............................................................................................................................... 5

2.2 Organization audit ......................................................................................................................... 6

2.3 Value chain audit .......................................................................................................................... 6

3.0 Situation analysis .............................................................................................................................. 6

3.1 Internal capability ......................................................................................................................... 7

3.2 External forces .............................................................................................................................. 7

3.2.1 Porter’s five forces ................................................................................................................. 7

3.2.2 PESTLE analysis.................................................................................................................... 9

3.3 Critical success factors ................................................................................................................ 11

4.0 SWOT analysis ............................................................................................................................... 12

5.0 Marketing strategies ........................................................................................................................ 12

5.1 Porter’s positioning ..................................................................................................................... 13

5.2 Push vs. Pull ................................................................................................................................ 14

6.0 Strategic choice ............................................................................................................................... 14

6.1 Marketing mix strategies ............................................................................................................. 15

7.0 Implementation and control ............................................................................................................ 16

7.1 Budgets ....................................................................................................................................... 16

7.1.1 Finance required ................................................................................................................... 16

7.2.2 Expected revenues................................................................................................................ 17

7.3 Marketing information system .................................................................................................... 17

7.5 Recommendations ....................................................................................................................... 18

E-Marketing mix ................................................................................................................................... 18

References ............................................................................................................................................. 21

Appendices ............................................................................................................................................ 23

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1.0 Introduction

ACME Smoothie UK runs its operations in the Hull region of the country. The business deals

in healthy drinks and refreshments in various types of fruit and vegetable smoothies. Mr. Joe

Blogs is ACME’s proprietor and is also in charge of the businesses operations in the Hull

City location. The Hull City operation has been exponentially successful with stable sales

records from the year of establishment to date. The success in Hull has prompted Blogs into

expanding the operation to cover greater parts of the UK market. It is the expectation of the

business owner that the national business will replicate the success noted in the Hull. Blogs is

aware of the numerous differences from the Hull market conditions that are inherent in the

domestic market. As such, it is imperative that ACME smoothies lay out a detailed plan on

how to enter the UK market and operate competitively. In this view, the business proprietor

has taken to researching new flavors and exotic ingredients to make ACME smoothies which

he expects will be a source of competitive advantage for the business.

1.1 Background

Smoothies are healthy refreshments sold in different flavors. Consumers of this brand of

refreshments take them as a healthy alternative to other additives induced alternatives.

Smoothies are also recommended for people with health issues as they are rich in vitamins

and other useful components. Further, smoothies are made with naturally with no or minimal

content to keep their beneficial attributes. Since there are many fruit flavors, smoothie

businesses have a diverse flavor portfolio which allows them to meet the flavor needs of

different customer bases. Additionally, owner of the business has been researching on exotic

fruits and flavor combinations to enable the brand to broaden its market reach as well as

separate itself from other players in the refreshment market. The ACME brand has

established itself in the Hull market by providing consumers with both the traditional fruit

flavors and other exotic ones which many businesses are unwilling to take the steps to make

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such rare brands. Blogs being a trained chef and nutritionist brings in his vast experience in

both fields to help the business navigate the food and nutrition market.

1.2 Rationale

The smoothie business in Hull has been on an upward trajectory allowing businesses such as

ACME to meet their objectives and even move to expand their market scope. From the

national perspective, people are taking up healthy lifestyles which include healthy dieting

which in effect broadens the market for healthy foods such as ACME’s smoothies. ACME

has adequately covered the Hull market and thus the need to expand the business. Further,

ACME is aware that the healthy dieting habits are only getting mass acceptance in the UK

and thus seeks to place itself at a vantage position to reap from this new lifestyle and serve as

a market leader by when healthy eating becomes a lifestyle of the greater UK population (see

Appendix A).

1.3 Aims and Objectives

The goals of ACME Smoothies as it moves into the UK market are;

i. To offer consumers across the nation with “an exclusive and unique smoothie

experience.”

ii. To develop the ACME brand into a leading vendor for healthy foods.

iii. To increase the ACME brand coverage to the whole nation.

2.0 Internal Analysis

2.1 Strategy Audit

Expansion into the national market requires a strategic approach to ensure ACME lives up to

its business objectives. As noted by (Berman 2016, n. pag.), a strategic audit is an assessment

tool for the applied business strategy. This tool further evaluates how well the business is

placed to execute the plan. ACME plans to roll out new branches sequentially so as to allow

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the market to understand its products and also allow its promotional activities to have

impacted the market.

2.2 Organization audit

ACME smoothies operate in a highly potent market which is also experiencing substantial

growth. The firm has the required resources to perform efficiently in the national market.

These resources include staff, finances, and equipment. Further, these functions are supported

by an active recruitment strategy that seeks to match the talent and the requirements of the

firm for optimal performance.

2.3 Value chain audit

Smoothies are sourced from a simplistic value chain which implies that there are not many

stop points before the final product is delivered to the client. However, ACME’s value chain

is designed such that each step of the production process guarantees optimal quality for the

consumers. The staff at each stage are trained experts who handle these products with utmost

care to ensure hygiene and consumer safety and observed at all time. The firm also endeavors

always to serve its clients with “farm fresh” smoothies made from fresh fruits and with no

additives or preservatives.

3.0 Situation analysis

According to (Lamb et al. 2013, p.38), a situation analysis is vital for the establishment of a

long-term relationship with a business’ consumers. Managers employ this approach to

understanding the internal and external environment of business, its capabilities as well as its

customers. It is expected that at the end of a situation analysis the business can choose the

apposite strategies for the completion of its objectives.

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3.1 Internal capability

ACME Smoothies UK operates in a tightly regulated business environment. The UK

government has put in place numerous standards and safety measures for all operators in the

foods and d-sector to protect consumers from harmful foods. The smoothie market, in

particular, has been doing well as more people take up healthy dieting (see Appendix B).

Smoothies are considered as a capable alternative to other refreshments like juice and soda.

In its market approach, ACME has segmented its consumers into two groups by their

smoothie preference there is the vegetable smoothies and the fruit smoothie segment.

It is important to recognize other established competitors in the smoothie and refreshments

sector that pose a threat to the ACME brand. Such players include The Smoothie Company,

Innocent Drinks, Love Smoothies and Smoothie Fresh. These brands have been on the

national scene for a greater time and have thus established a broad network of suppliers and

product vendors. It is the intention of ACME smoothies to take up a share of the market

controlled by these firms through filling value gaps the companies have left in their products.

3.2 External forces

As noted by (Nieuwenhuizen, et al. 2008, p.20), the external business environment presents

factors outside the firm’s jurisdiction but have and impact on the functioning of the company.

While the enterprise can manipulate some of these factors, others are rigid and thus demand

the firm to adapt to them.

3.2.1 Porter’s five forces

Hill and Jones (2010, p.42) discuss Porter’s five force model as a useful framework for the

evaluation of the competitive position and strength of an entity. ACME’s five forces are;

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Fig 1: Porter’s Five Force Model (Hill & Jones, 2010)

Supplier bargaining power

The ACME setup places its suppliers in a position of power. The business requires high-

quality fruits and vegetables for its production with can only be sourced from trusted dealers

who are willing to partner with the firm in ensuring high quality and healthy ingredients are

used in production. However, there is an option for the firm to source its product from the

international market where the quality standards are observed in a bid to avoid manipulation

by the local suppliers.

Buyer bargaining power

Smoothie consumers do not hold substantial power in their relationship with ACME. The

brand has established itself on quality and diversity which many consumers are happy to

accept. The uniqueness and quality of ACME smoothies are meant to insulate the firm from

the low costs of switching to competitor products.

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Competitive rivalry

There are several large players in the UK smoothie market. These players are willing to take

extreme measures to protect their share of the market. A big challenge in the foods market

has been players replicating signature flavors from their competitors to avoid losing out.

ACME has ventured into exotic brands as well as new flavors to fend off completion and map

out its share of the market.

Threat of substitutes

There are numerous substitute refreshments for ACME smoothies both from healthy foods

dealers and other chemically manufactured drinks. Additionally, there are home-made

smoothies which are equally as good as ACME’s when the correct processing procedure is

followed. ACME gains an advantage over these substitutes from the fact that trained

nutritionists and health experts are part of the staff. This makes the ACME brand reliable to

deliver on the marketed value.

Threat of new entrants

Though the UK foods market is highly regulated, the barriers to entry are not high. Further,

this business is not resource intensive and can be efficiently run on a small scale. This low

threshold implies that small entrepreneurs can easily venture into the business and provide

competition to the bigger brands. ACME intends to fend off such competition through

maximizing its economies of scale.

3.2.2 PESTLE analysis

A discussion by (Cheverton 2004, p.72) views the PESTLE analysis as a tool that businesses

implement to assess an environment within which it intends to launch a product or service.

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Political

These factors define government influence on the national economy or a particular sector.

The UK government imposes friendly taxes on all goods produced from local products.

Further, the government has also entered into regional and global agreements to ensure

product deficits are met within reasonable costs. Further, the fiscal policy in the UK is

friendly to businesses that create employment to locals.

Economic

The economic factors affect the performance of the local economy. Such factors include

inflation, interest rates, and the economic growth rates. All these factors bear a direct impact

on the consumers’ purchasing power. The UK economy is positively performing while

inflation and interest rates are within reasonable limits. As such, consumers in the target

market are well placed to continue affording the product offered by ACME.

Social

These factors are driven by social variables such as demographics, cultural trends, and

population. There is sufficient interest in healthy dieting in the UK market. Further, there are

numerous campaigns and government initiatives urging the people to take up healthy

lifestyles which serve to bolster the target market for ACME.

Technological

Technology is an important part of contemporary production activities. Adoption of

technology in the foods and beverages sector serves to improve production efficiency and

also enable the firm to benefit from the economies of scale. Further, there is increased use of

technology in research and development as well as marketing and selling.

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Legal

Legal factors are viewed as the laws and regulations shaping a business environment. The

most relevant legal variables for ACME include licensing, safety standards, labor laws, and

consumer laws. It is prudent for the firm to run in compliance with these legislations to avoid

issues with the government and all possible liabilities arising from non-compliance.

Environmental

These factors are influenced or determined by an organization’s surroundings. They include

pollution and climate change. It is critical that ACME adheres to the set environmental

regulations. Further the company should also demonstrate responsible waste management.

3.3 Critical success factors

These factors are at the center of ACME’s success at Hull and will also shape the national

market.

i. Customer relations – positive relations with clients, will ensure they are loyal to

the ACME brand.

ii. Product quality – high quality is among the key selling points for ACME

smoothies.

iii. Value addition – above regular standard ACME strives to extend the product

value for its clients.

iv. Product diversity – ensuring that customers have a sizeable product catalog to

meet all their flavor needs.

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4.0 SWOT analysis

A SWOT analysis is explained by (McDonald et al. 2003, p.148) as a tool through which

entities evaluate their internal strengths and weakness and also highlight opportunities and

threats in their operation.

Strengths

ACME has established itself through quality and diversity. Customers have grown to

appreciate these attributes giving them a close association with ACME.

Weaknesses

Employees at ACME do not have competitive salaries and benefits as compared to the other

large players in the sector causing a high employee turnover.

Opportunities

Cocktail smoothies are yet doing well in the market. ACME can use its exotic and diversity

attributes tp produce unique and high market smoothie cocktails.

Threats

Substitutes and competition are a significant threat to ACME smoothies. The market has not

taken up healthy dieting despite knowing the benefits they stand to gain. ACME needs to

invest in marketing and customer awareness to create its market niche.

5.0 Marketing strategies

These are the strategies ACME will execute to launch successfully and sustain its product in

the UK market

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5.1 Porter’s positioning

Michael Porter’s generic strategies present a viable market approach for ACME smoothies.

Under these generic strategies, Porter puts it that when the profitability of an entity is

primarily dependent on the attractiveness of its industry, then a vital secondary determinant is

its position in the market. In this view, the firm is expected to position itself strategically

through its strengths – cost advantage and differentiation.

Fig 2: Porter’s Generic Strategies (McIvor 2005, p.116)

Cost leadership strategy

This strategy demands that ACME becomes a low-cost producer in the smoothies market.

The firm would then sell its products at the average market price and make higher profits than

the competition. ACME can also opt to sell its smoothies at lower prices to gain a market

share. The firm only attains cost leadership through efficient production, using low-cost

materials and outsourcing some functions. It is further required that ACME has access to

adequate capital to be invested in the production process, skilled product designs for efficient

production and efficient distribution channels.

Generic

Strategies

Cost

leadership

Superior profits

through lower

costs

Differentiation

Creating a unique

product for the

market

Focus

Concentrating on

limited part of the

market

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Differentiation strategy

Here, the firm concentrates on building a product that holds unique features that are valued

by consumers and make the product come out as superior to its market peers. Through the

value brought by the uniqueness, the firm can review the pricing upwards. It is required that a

firm has a dynamic R&D team for continuous development, has a capable sales team to

capitalize on the uniqueness and also is reputable for quality and innovation.

Focus strategy

This strategy calls for concentration on a segment of the target market and seeking to derive

cost advantage or differentiation from the segment. The intention here is to build customer

loyalty by solely focusing on servicing the needs of that particular customer niche. Success in

through this strategy is attained through tailoring broad product strengths into the particular

market.

5.2 Push vs. Pull

The Push – Pull strategy defines the ways in which the customer accesses the product, in the

push approach, the product is taken to the client through any convenient channel to ensure

that they are aware of the product and places to purchase it. In the pull strategy, ACME can

use point of sale displays, retailer negotiation, trade show promotions and direct selling.

On the other hand, the pull strategy motivates the consumers to seek out the product through

an active process. Here, ACME can use methods such as customer relationship management,

word of mouth ads and mass media promotions.

6.0 Strategic choice

The strategic choice defines the approach to be taken by a business in meeting its market

objectives. A strategic choice is reached after a comprehensive assessment of the external and

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internal business environment to design the most appropriate path for the firm. Through the

strategic choice, the company decides on its growth strategy and how to maneuver sectoral

competition

6.1 Marketing mix strategies

Product

Quality is an essential element for ACME smoothies. This attribute ought to always remain

constant. Further, the ACME brand is synonymous with variety and diversity. It is important

that these attributions remain as they are among the strengths of the brand. The company can

now consider packaging its smoothies in an attractive manner to further up its competitive

edge.

Place

ACME products ought to be accessible to the target market. The customers should be made

aware of these products through marketing initiatives like advertising, personal selling, and

promotion. These activities will enable the customers to gain awareness of the product’s

existence and also where to get these products.

Price

The pricing strategy is an important feature for a product that is new to the national market.

As such, ACME should implement price discounts for the introductory period to allow users

sample its products. Further, it is important that the price of these products be easy for

customers to get to enable them to assess the value for their money.

Promotion

In the promotion of ACME smoothies, the channels chosen ought to be ones that reach the

target market most effectively. It is also important to look at the cost and coverage of a

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channel when deciding on the most efficient alternative. After communication with

consumers, it upon the firm to ensure that there are sufficient product stocks to satisfy the

created demand.

7.0 Implementation and control

7.1 Budgets

7.1.1 Finance required

Particulars

Amount ($)

Personnel cost

Recruitment

200,000

Salaries and wages

7,200,000

Employee Benefits

2,400,000

Commissions and Bonuses

840,000

Travel

840,000

Contingencies

3000,000

Offline Marketing

Public relations

1,800,000

Print Ads

600,000

Sales promotions

500,000

Personal selling

1,500,000

Publicity

375,000

Online Marketing

PPC cards

1,800,000

ACME Web Development

100,000

Direct Marketing

3,000,000

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Webinars

200,000

Total Expenditure

24,355,000

7.2.2 Expected revenues

Flavour

Annual

Strawberry

945,000

1,620,000

2,835,000

3,600,000

9,000,000

Cocktail

945,000

1,800,000

3,645,000

5,400,000

11,790,000

Veggie

315,000

720,000

1,215,000

2,250,000

4,500,000

Mango

945,000

1,620,000

2,835,000

3,600,000

9,000,000

Apple

630,000

1,080,000

2,025,000

2,700,000

6,435,000

Pineapple

787,500

1,440,000

2,430,000

4,050,000

8,707,500

Cocopine

1,260,000

3,520,000

4,050,000

6,750,000

14,580,000

Total

5,827,500

10,800,000

19,035,000

28,350,000

64,012,500

7.3 Marketing information system

ACME’s MIS functions as the primary source of refined marketing information. It is an

important element in organizational marketing decision-making as it collects information

from all relevant quarters, processes it and gives out accurate market intelligence.

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7.5 Recommendations

i. Product diversification ought to be considered for the ACME brand. While the

brand is currently doing well, adequate plans for changes in the product life cycle

ought to be put in place for brand continuity.

ii. Employee remuneration ought to be revised to offer ACME workers competitive

rates. This measures will help curb the high levels of employee attrition as they

seek better rewarding employment.

iii. The marketing and promotion budget for a brand that is new on the national scope

ought to be bolstered. The firm is working on a customer acquisition plan for the

UK and thus the budget ought to be commensurate with the large market area.

E-Marketing mix

Online marketing overhauls the traditional marketing by bringing in convenience and

accessibility to goods and services. Modern consumers research and make purchases for

goods online which necessitates online strategies for the businesses to attract and retain

clients.

E-pricing strategy

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In the traditional market dispensation, pricing was a balance between the competitor

prices and the rates the consumers are willing to pay for goods or services. In internet

marketing, the majority of involved prices such as staff costs are marginalized making such

businesses more attractive to consumers than physical stores. Further, through the web, a

consumer can compare prices from a range of sellers and settle for the fairest charge. There is

also some internet driven applications for price comparison which avail substantial amounts

of product pricing information to the consumers (Chaffey et al. 2008, p.97). Through the

availability of this information, product prices are managed within a particular range for the

online dealers. As such, these tools work to give power to the consumers as sellers are forced

to conform to the average prices. Additionally, online selling platforms have auction

functions which enable the consumers to dictate product prices (Viglia 2014, n. pag.). Selling

on such platforms is done on the highest bid basis which implies that the seller has no control

whatsoever over the price of their product. Ebay.com is the leading global product auction

platform.

While creating an e-pricing strategy, it is also important to create a reliable payment

method for clients across all platforms. It is common to find e-commerce sites that do not

support payment such as Payoneer or bitcoin. The lack of a comprehensive payment platform

limits the customers to the supported avenue which in turn implies a loss of the customers

with alternative payment methods. PayPal is currently the leading e-payment tool across

many commerce platforms. Among the most important positive impacts to e-pricing

strategies is the ability for the business to engage its consumers. Through the discussions and

feedback from clients, the company can carry out a value analysis for the goods or services

rendered to the client and determine whether the clients truly get value for their money. E-

pricing provides a way for businesses to monitor the purchasing patterns for the customers to

make suggestions or price alterations that fit the target market. Further, through this

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monitoring, the company can seamlessly run a promotion and reward program as they are

aware of what their customers need and for what price.

While addressing payment, it is critical that user security be guaranteed. The business

must ensure that all its customer information remains confidential and inaccessible to

malicious individuals. Banking or payment information is particularly very critical as it has

been targeted by fraudsters and cyber criminals numerously. It thus is upon the business to

ensure that any such information that it holds is always secure. On their commerce platforms,

the entities ought to do away with malicious ads that may lead to harm to its clients. Security

of user information while on transacting on the platform should always remain the liability of

the business as it seeks to cultivate confidence from such visitors

The internet has brought forth disruption in the marketing scene by eliminating and

realigning some traditional functions. It is now critical for any business running on internet

commerce function to have sufficiently trained staff as well as the required resources to

support work on the online platforms. Further, there has been a significant reduction in

marketing costs as overheads like staff and transport now marginal. The effort a business in

the traditional setup applied in reaching a 100 people is now the same effort used to reach

millions of buyers across the globe. For consumers, the internet has handed them control

through the availability of information. Sellers are now forced to set product prices at

amounts deemed as fair by their target market or risk losing out to the numerous readily

available alternatives.

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References

Berman, C., 2016. What Is the Importance of the Strategic Audit?. [Online]

Available at: http://yourbusiness.azcentral.com/importance-strategic-audit-25082.html

[Accessed 16 August 2016].

Chaffey, D., Smith, P. R. & Chartered Institute of Marketing, 2008. Emarketing Excellence:

Planning and Optimizing Your Digital Marketing. 2nd ed. Amsterdam; London: Butterworth-

Heinemann.

Cheverton, P., 2004. Key Marketing Skills: Strategies, Tools and Techniques for Marketing

Success. 1st ed. London; Sterling, VA: Kogan Page.

Hill, C. W. L. & Jones, G. R., 2010. Strategic Management Theory: An Integrated Approach.

1st ed. Mason, OH: South-Western/Cengage Learning.

Lamb, C. W., Hair, J. F. & McDaniel, C. D., 2013. Essentials of Marketing. 3rd ed. Mason,

Ohio: South-Western, Thomson Learning.

McDonald, M., Rogers, B. & Woodburn, D., 2003. Key Customers: How to Manage Them

Profitably. 2nd ed. Oxford; Boston: Butterworth-Heinemann.

McIvor, R., 2005. The Outsourcing Process: Strategies for Evaluation and Management. 1st

ed. Cambridge; New York: Cambridge University Press.

Nieuwenhuizen, C., Badenhorst-Weiss, . & Rossouw, D., 2008. Business Management: A

Contemporary Approach. 1st ed. Cape Town: Juta.

Statista, 2014. Average Consumption of Smoothies in the United Kingdom from 2006 to 2012,

Per Person (in litres). [Online]

Available at: http://www.statista.com/statistics/283984/fruit-juice-smoothies-consumed-per-

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person-in-the-united-kingdom-uk/

[Accessed 10 August 2016].

Viglia, G., 2014. Pricing, Online Marketing Behavior, and Analytics. 1st ed. Houndmills,

Basingstoke, Hampshire: Palgrave Macmillan.

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Appendices

Appendix A: Healthy dieting habits in the UK

Appendix B: Smoothie consumption in the UK (Statista, 2014)

0.2

0.4

0.6

0.8

1.2

1.4

2006 2007 2008 2009 2010 2011 2012

Avg consumption per person (in ltrs)

Year

SMOOTHIE CONSUMPTION IN THE 2006 - 2012

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