SUKESH marketing_assignment

8/7/2019 SUKESH marketing_assignment

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Managing Strategic Marketing

Executive summary

Marketing mix is an important component of marketing and

organizations take additional care in formulating and implementing the

marketing mix.

This assignment analyzes and evaluates the marketing mix of MJR

Timber and Furniture Company based in India which is also my own

firm.

The company is in the wood furniture industry and competes with

OMER Furniture, another furniture manufacturer operating in the same

place.

The study has compared the present marketing mix of both the

companies and has traced out certain deficiencies in the mix of MJR

furniture Company when compared to the competitor.An improved marketing mix has been formulated for the MJR Company

along with some action plans which would enable the company to

attain major market share thus achieving its mission and vision in the

next two years.

Name: P.M. Sukeshwar Reddy 1Index No: OF3.


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TABLE OF CONTENTS

1. Introduction 3

2. Background of the Company 4

3. The marketing mix 5

4. Marketing mix of MJR Timber & Furniture 8

5. Improved Mix for MJR Timber & Furniture 14

6. Action Plans 15

7. Conclusion 16

8. Bibliography 17



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1. INTRODUCTION

Over the years, with rapid industrialization of the world, a massive

sector evolved and has occupied a relevant position in business and it

is identified as the marketing sector.

Marketing is an evolutionary process that links firms to customers.

Production has no meaning without marketing. In simple words

Marketing is the performance of business activities that divert the

flow of goods and services from producer to consumer or

user.(American Marketing Association).The traditional concept

stresses the selling of goods and services. The modern concept of

Marketing is a total system of interacting business activities designed

to plan, price, promote and distribute want-satisfying products andservices to present and potential customers. (William j. Stanton,

fundamentals of marketing, 1978, p.5.) The modern marketing is a

broad and customer oriented concept. One of the most important

components of marketing is the Marketing Mix.

The concept of Marketing Mix is an interesting one. The

four main elements namely, the product, price, place and promotion

play an important role in the plan. The Marketing Mix must be

delivered in the right way to the right people at the right time. It is

important that all the elements are given equal and balanced

importance and managed. Marketing Mix is considered as the blend

and batter of the ingredients that determines the appreciation by the

consumer. Marketing Mix occupies a dominant position in the plan of



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every organization and is adapted well in most successful

organizations. The marketing mix formulated should be according to

the nature, requirements and preferences of the customers.

Finally, it can be said that the way an organization uses

the component is important rather than sticking to theories and

waiting for result. Marketing plan should be designed and formulated in

a systematic way so that the execution results in the best and effective

way. The application of marketing mix will be according to the

demands of a particular situation as the situational variable is very

critical even though the Marketing Mix is very essential for an

organization to survive The assignment intends to evaluate and

analyze the application of Marketing Mix in own firm and comparisons

with the main competitor enabling a better understanding of the

concept.

2. BACKGROUND OF THE COMPANY

MJR Timber & Furniture Pvt Ltd is basically a wood processing and

furniture manufacturing firm where log wood is processed into timberand assembled for the production of furniture. The industry is equipped

with modern machines capable of converting heavy log wood to timber

.The processed timber is then used for the manufacture of furniture

products in the manufacturing department of the company. The small

scale industry manufactures wood furniture products for living, dining



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and bed rooms under the brand name 'MJR' .The small scale industry

was started by Madireddy Janga Reddy in 1988 in Hyderabad, a major

city in the state of Andhra Pradesh, India with an initial investment of

US$ 20,000. The main aim was to obtain local processing works and

sell maximum upholstered wood furniture to customers through the

company retail showroom outlets operating in Hyderabad.

The company is committed to provide high quality furniture

products to the customers. The firm aims to deliver the customer

needs at the right time .High quality furniture products are

manufactured from top quality wood which is imported at times. The

wood furniture is manufactured in accordance to the latest design and

fashion. The sparkling performance of the company in selling in spite

of tough competition reveals the product quality; afford ability and

goodwill of the organization among customers. The company's main

competitor is the OMER Wood Industries which operates in the same

place. The mission of MJR Timber & Furniture Pvt Ltd is to create

monopoly in the wooden furniture market of Hyderabad.

3. THE MARKETING MIX

The concept of marketing mix starts with marketing and market

segmentation. No matter the size of the company, the principles of

marketing applied properly can improve one's profitability. ''Marketing

is the discovery or identification of needs and execution of those

activities necessary to plan and provide need satisfying products and

services and to price, promote, distribute and effect exchange of these

products at an acceptable cost and in a socially responsible



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manner(Shaw and semenik,1985).The marketing mix is the core

component of marketing. It starts with market segmentation.'' Market

segmentation is the sub-dividing of the market into homogeneous

subsets of customers where any subset may conceivably be selected

as a target market to be reached with a distinct marketing mix.(Philip

Kotler, Marketing Management, 1988, p.166.) In order to cater to the

requirements of identified market segment, an entrepreneur has to

develop an appropriate marketing mix. The marketing mix is a

systematic and balanced combination of four important elements and

is as follows:

Product

Price

Place

Promotion

The marketing mix is the combination of marketing elements used in

the sale of a particular product. All these are considered in planning a

marketing strategy. Any one may be enhanced, deducted or changed

in some degree in order to create the strategy necessary to efficientlyand effectively sell a product. The marketing mix is the essence of

modern marketing and definitely plays a vital role in the growth and

survival of an organization.

Product

This element involves decisions concerning product line, product

design, brand name, package, after sale service, etc. The product is

considered as the core element because if there isn't a product there is

no marketing mix. The product requires renewal at frequent intervals

to sustain the customer. Branding and Packaging are extremely

important for a product. Branding is the process of assigning a

distinctive name to the product by which it is to be known and



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remembered. Packing implies placing products in suitable packages for

safe and easy handling. it is essential to determine the product, nature

of the product etc. Firms should never be shortsighted as to think they

only provide customers with a physical product. In todays market

place it takes more than that to compete. A company is required to

develop a product that can capture the market. The product should

prove something special to the customer so that it can keep growing in

the product life cycle.

Types of products:

Commodity products

Specialty products

Differentiated products

Hence the product element of the mix is the most important of all. A

company's main job is to create a product, a product that can create

favorable image in the minds of customers. Product positioning is

essential for this particular task.

Price

It involves decisions relating to price policy, basic price, discounts,terms of credit etc when setting a price we need to ensure

that the product will be able to compete with rival companies and need

to charge a price that the customer is willing to pay. Price enters the

second important consideration of the marketing mix. Price is an

important element of the marketing mix as it influences the profit

margin and the sales volume. The key to pricing is to build value into

the product and price it accordingly. A few pricing policies are listed

below:-

Loss leader pricing

Penetration pricing

Price skimming

Differential pricing



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All these policies can be adopted keeping in view the pricing policy of

the competitor. Pricing is a complex process that is important to the

success of a company. The price of a product has to include a number

of variables in addition to just the product cost which includes the cost

of producing the actual product, marketing that product,

transportation, packaging, insurance, and any necessary taxes.

Irrelevant pricing policy can prove fatal for an organization.

Place

If farms and factories are the heart of industrial America, distribution

networks are its circulatory system.(Corey ET al.1989)

This statement helps to show how vital distribution is to the industrial

sector. Without proper distribution, products have no way of reaching

the ultimate customer. Place simply refers to how you will sell your

products to your customer. It involves the distribution of the products

to the customer. Distribution systems are organized into channels.

These channels are an organized set of institutions whose goal is to

move goods from point of manufacture to point of consumption. A fewchannels of distribution are:-

Manufacturer Customer

Manufacturer Retailer Customer

Manufacturer Wholesaler Retailer Customer

In order to select the right channel for the distribution of the product,

certain considerations like the nature of product, nature of market,

nature of firm etc are applicable.

Promotion

Any personal or non-personal communication that creates a favorable

disposition toward a good, service or idea in the mind of the recipient



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of the communication. (Shaw and semenik 1985)The key objectives of

promotion are to inform, persuade and remind.

It requires decisions with respect to advertising, salesmanship, sales

promotion, advertising media, theme of advertising, advertising

budget etc. promotion leads to awareness of the product among the

consumers. Promotional mix comprises of Advertising, salesman-ship,

sales promotion and publicity. Advertising is a controversial topic.

Some experts believe that advertising is a social waste while others

consider it an essential ingredient of business. All major organizations

are involved in exclusive promotional activities and the giant

companies like Pepsi, coco-cola, Vodafone etc are those investing high

for media advertisements that creates immense popularity for the

product. Advertising can be done through many different types of

media. These can include:

Radio

TV

Magazines

Business Card

Newspapers The media advertising is the most effective media of promotion, the

best way of familiarizing the product among the public even though

high investment is required for advertising on TV, Radio, Newspapers

and Magazines.

The marketing mix is applicable and will be applicable in the future

because it is not something which can be ignored and if business

happens marketing mix will also happen and will be implemented. The

concept is only prone to changes according to the different

organization requirements.



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4. MARKETING MIX OF MJR TIMBER & FURNITURE

MJR Timber & Furniture Pvt Ltd employees a typical marketing mix. Our

marketing mix mainly depends on the product, but we also realized

that the pricing policy was the key to our recent growth. The company

aims to create monopoly in the wood furniture market of Hyderabad by

attaining a major market share. The marketing mix of the company

was a result of intensive research and market evaluation based on the

facts of survival and growth. The Target Market of our company is the

households of medium income bracket living in urban areas with statusconsciousness. The marketing mix employed by the company is as

follows:

PRODUCT

MJR Timber & Furniture Pvt Ltd manufacture upholstered wood

household furniture with the brand name MJR .The company offers a

diverse range of modern and traditional furniture. The company's

success has grown from its ability to produce high-quality furniture at

affordable price with outstanding customer service. The brand is liked

and appreciated by customers all over the state because of the quality

and styling. The creation of a brand name was necessary in order to

familiarize the furniture product among customers. A variety of

furniture products are manufactured under the brand name MJR and

those include sofa sets, chairs, dining sets and doors exclusively for

living, dining and bed rooms. Our product is a unique combination of

fashion and fine furniture craftsmanship. We need to sell pride of our

workmanship and prestige. The brand furniture product is truly our

pride now but we had to face a lot of problems while planning the new



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product, the decision to produce wood furniture was implemented after

a study of customer preference and satisfaction. The study revealed

that the households and professional home builders preferred wood

furniture than other material furnitures even though it was expensive

and it was because wood furniture always offered premium styling with

a glance of royal feel and durability. This fact tempted us to stick on to

wood and manufacture wood furniture. The wood used for the

production are teakwood, mahogany, jack wood and rub wood.

The brand faces tough competition from the competitor brand 'OMER'

manufactured by the OMER wood industries which operates in the

same city.

PRODUCT OF THE COMPETITOR

The main competitor of MJR Furniture Company is OMER wood

industries which manufactures wood furniture products under the

brand name 'OMER. The company manufactures quality products for

professional home builders and high income households. The OMER

brand also maintains high quality and produces living, dining and bedroom furniture. The collection of furniture models is large and OMER

offers a variety of the product.

WHICH BRAND IS BETTER?

Both brands share the market equally at the present. The MJR brand is

better in terms of afforded ability and durability while the OMER brand

offers better trends and collection of wood furniture. Both the products

are equally appreciated and considered by the customers. The market

share of the brands is equal and can be shown as follows:



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MJROMER

Figure 1 PRESENTMARKET SHARE 50-50

It can be concluded that both the products share the market equally

and are customer satisfying brands. The products are of equal want by

the customers. There is no better product among the two brands and is

highly competitive.

PRICE

The price is another important factor that determines the fate of the

product. We knew that the customers will be more concerned about

the price because we were targeting medium income households and

home builders. The cost of raw materials and labor was an unfavorable

factor for us to determine a low price and in spite we decided to go for

low profit at the beginning which slowly enabled us to penetrate into

the market. The pricing that we adopted was the penetrating pricing

policy. The MJR brand is now the best affordable furniture brand in the

market. We could penetrate the market only because of the apt pricing

policy. After the market entry and attaining a 50% market share the



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Direct selling is preferable when the market is small and is

located in a narrow area.

We possessed marketing expertise and required control over

distribution.

The desired types of middlemen were not available. The MJR

company distribution channel can be shown with the help of a

diagram:

THE COMPETITOR DISTRIBUTION The OMER Company distributes their product through the producer-

retailer-consumer channel. The company has invested a lot for the



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distribution of their brand. The furniture retail outlets operating in the

city are their channel. The channel is shown below:

WHICH IS THE BETTER CHANNEL?

For a furniture company a short channel of distribution is always

preferable because the product is bulky and transportation can be

minimized and expenses can be reduced. The MJR Company has a

short and controlled distribution network. In this case the company can

study the customer and produce the products according to customer

preference and it can be concluded that the MJR Company has better

distribution by running its own retail outlets.

PROMOTION

Our promotion strategy is mainly based on making the information

available to the right target customer. The main job of our promotion

team is to make people interested in our kind of product aware that

the product exists and where to find it. The main source of promotionfor our company is publicity and sales promotion.

Publicity include news releases, articles in trade magazines and

newspaper articles. This is a valuable method for creating positive

public perception for the firm. It is also an economical method suitable

for small scale organization.

Sales promotion activities of our company mainly include point-of-

purchase literature and trade shows. Trade shows have become a good

way to promote products within the industry. We normally highlight our

product price in order to attract customers.



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THE OMER PROMOTION

The OMER Company is involved in every kind of promotional activities

which include advertising, personal selling and sales promotion. The

company advertises often on the radio and newspapers. The company

has been successful in their promotional activities and kept it going till

the arrival of the MJR Company. After the launch of the medium priced

MJR brand the OMER Company experienced decline in the sales and

lost half of the market to our company. The promotional activities are

still in action and effective extend.

WHOSE STRATEGY IS BETTER?

The OMER Companys promotional activities are better than that of the

MJR. The OMER company has been successful advertising on the Radio,

which is one of the most mass appealing media and also by the means

of personal selling. Personal selling is very effective and is used often

in the wood products industry and it has many advantages over otherforms of promotion. It can be concluded that the competitor has better

promotional activities when compared to the MJR mode of promotion.

5. IMPROVED MARKETING MIX FOR MJR TIMBER & FURNITURE

There is a wide scope for improvement in the marketing mix of MJR

Furniture Company. The company has to develop a new strategy

focusing on the product and promotion elements of the mix. Even

though the company has been successful in selling in the recent past,

the product and promotion strategies need to be reformulated. The

competitor has better strategies of the product and promotion

elements. It is clear from the analysis of the mix that the competitor



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has a variety of models under their brand and has superior collection

of furniture while the MJR brand has only a few models and the

promotional activities are insufficient when compared to the

competitor. The pricing and distribution strategies are well structured

and adapted in our organization. The following are suggestions for

improvement in the mix and growth of the company:

Customers are mainly interested in selecting from a range of

furniture models, the company should provide them with more variety

of models both traditional and modern.

Promotion plays a very important role in the customers decision

making process. In case of MJR it has less sales promotion schemes. So

importance should be given to promotional activities.

Advertising has to be done on Radio and TV as these are the mass

appealing Medias.

Advertising has to be done in other Medias also like hoardings,

posters and magazines.

6. ACTION PLANS

To develop new models of upholstered wood furniture product

under the same brand.



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To advertise on the most mass appealing Medias like TV, Radio

and Magazines.

To concentrate on new product development and the

promotional activities.

Recently we noticed a craze for traditional model furniture among the

customers. The company now concentrates on developing traditional

models under the brand 'MJR ROYAL' and providing them with

exclusive promotion.

Hence by enforcing the new strategies the company can make

impressive improvements in the Marketing Mix and compete in an

advanced manner thus achieving its mission and the vision.



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7. CONCLUSION

The marketing mix is the true essence of an organization. All the

elements namely the product, price, place and promotion are equally

applicable and important even though organizations can prioritize

according to the nature of Business. The Company has to examine how

well the product can be managed and send to the consumer. All these

can be achieved by employing a suitable marketing mix. This

assignment evaluates the application of marketing mix and its

importance for the growth and sustainability of an organization. The

idea of comparing marketing mix with that of the main competitor is

well appreciated and effective because there is a scope for

improvement in most cases.

In such cases the company can identify the areas that need to be

reformulated and prioritized. It can be concluded that the marketing

mix is an essential component of marketing which cannot be ignored

and kept aside as the circulatory system of marketing is identified tobe the Marketing Mix.



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Name: P.M. Sukeshwar Reddy 21

SUKESH marketing_assignment

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