EXECUTIVE SUMMARY This document discusses the marketing strategies, problems and solutions for a selected company and its new product being launched. The company discussed in this document is Gandhara Nissan Limited working in Pak akist istan; an; in colla collabor borati ation on with with Nissa Nissan n Motor Motor Co Co.. Japan. Japan. Gandh Gandhar ara a Nissan Nissan is launching anew car with name of “Nissan next” and this document provide an efficient and workable marketing plan for the product. In Pakistan automobile industry is growing at a rapid pace. The demand for cars in Pakistan over time has increased a lot due to growth of economy and stability of people economic condition. condition. This has attracted a number of producers producers towards the market. Nissan along with other producers like Toyota, Suzuki and Honda etc. is a player in the automobile market. Now Nissan has planned to launch a new car with significant innovations and steps towards improvements. For the success of the car in industry a deep study and research has been undertaken to develop an effective and efficient plan. Some Some of the the impo import rtan antt area areas s cove coverred in this this docu docume ment nt whil while e deve develo lopi ping ng a Marketing Plan for the selected company are: •
Discussion of the Industry
•
Analysis of company’s position
•
Marketing objectives
•
Promotions strategies
•
Pricing strategies
•
Product strategies
•
Distribution strategies.
Furthermore, action plan lays out successful implementation through monitoring has also been included.
TABLE OF CONTENTS Executive Summary........... .................... ......... .... ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... ..1 Table of Contents Conten ts............ ....................... ....................... ........................ .................. ...... .... ........ ........ ......3 1.0. Automobile Industry Overview .......... ................... ................... ................... ...........6
1.1. Global Industry for Automobile .....................................................................6 .....................................................................6 1.2. Automobile Automobile Industry Industry Overview Overview of Pak Pakistan istan ........................................... .................................................. .......7 7 2.0. Nissan: History Histor y............ ....................... ....................... ....................... ....................... .............. .. ... 7
2.1. Introduction ..................................................................................................7 2.2. Nissan’s Vision .............................................................................................8 2.3. Nissan’s Mission ...........................................................................................9 3.0. Nissan next: n ext: Marketing Environment Env ironment .... ........ ........ ........ ........ ........ ........ ....... ... 9
3.1. Micro Enviro Environment nment............................................................. ..................................................................... ................ ................ ........... ...9 3.1.1. Consumers............................................................................. ........ ................ .........9 . 3.1.2. Competitors............................................................. ..................................................................... ................ ................ ............... .......9 3.1.3. Intermed Intermediaries iaries................................................................................ ........ .........9 . 3.1.4. Publics........................................................................................... ........10 10 3.2. Macro Environme Environment nt............................................................. ..................................................................... ................ ................ ........10 10 3.2.1. Demographic Environment..................................... .............................................. ................. ................ ............. .....10 10 3.2.1.1. Education............................................................................ ........ ............ ....10 10 3.2.1.2. Pop Population ulation...................................................................... .............................................................................. ................ ........10 10 3.2.2 Economic Environment.............................................. ...................................................... ................ ................ ............ ....10 10 3.2.3. Technologica echnologicall Enviro Environment nment..................................... .............................................. ................. ................ ............. .....11 4.0. Nissan next: n ext: Product Evaluation E valuation ........... .............. ....... ........ ........ ........ ........ ...... ..12
4.1. Core, Actual and Augmented Product...... ............ ............ ........... ........... ............ ............ ............ ........... ........... ......12 12
4.2. Consumer or Industrial Product?............................................. ..................................................... ................ ............ ....12 12 4.3. Convenience, Shopping, Special or Unsought Product.................... ............................ ............ ....12 12 4.4. Product Uses and Consumer Acceptance..................................... ............................................. ............... .......13 13 4.5. Distribution – Wide Spread or Not?...... ............ ............ ............ ........... ........... ............ ............ ............ ........... ......... ....13 13 4.6. SWOT Analysis............................................................. ..................................................................... ................ ................ ............... .......13 13 4.6.1. Strengths...............................................................................................13 13 4.6.2. Weaknesses............................................................... ....................................................................... ................ ................ ........... ...13 13 4.6.3. Opportunities................................................................ ........................................................................ ................ ................ ........14 14 4.6.4. Threats....................................................................................... ........ ........... ...14 14 5.0 Consumer Evaluation Evaluatio n.......... ...................... ...................... .......... .... ........ ........ ........ ........ ......14
5.1 Type Type of Purchase Decision .................................................................. ........ ..........14 14 5.2 Consumption – consumer response..............................................................14 5.3 Quality, Comfort & Safety................................................. ........ ................ ................ ........... ...15 15 5.4 Customer Awar Awareness eness and Brand Switching................................... ........................................... ............... .......15 15 5.5 Brand Prospects -- Location and Influence ..................................................15 ..................................................15 6.0 Competitor Analysis......... ............. ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......17
6.1 Pricing............................................................................... ........ ................ ................ ........... ...17 17 6.2 Pro Promotion motion......................................................................................... ........ ............ ....17 17 6.3 Distribution...................................................................................................17 17 6.4 Future Future Competitors and Replacement Replacement Products...... ............ .......... ........ ........ ........ ........ ........ ........ ....... ...17 17 7.0 Marketing Objectives Objective s........... ....................... ....................... ............... .... .... ........ ........ ....... ... 19
Goals and Objectives..........................................................................................19 19 8.0 Marketing Strategies.......... ...................... ................... ....... .... ........ ........ ........ ........ ........ .... 20
8.1 Target Mark Market et................................................................... ........................................................................... ................ ................ ............ ....20 20 8.2 Nissan next Target Market: Market: Geographic Segment..... ......... ........ ........ ........ ........ ........ ........ ........ ....... ...20 20 8.3 Nissan next Target Market: Psychographics ...... ........... ........... .......... ........ ........ ........ ........ ........ ........ ........ ....20 20
8.4 Nissan next Target Market: Market: Demographics...... ............ ............ ........... ........... ........... ......... ........ ........ ........ ......20 9.0 Marketing Mix Strategies Strategie s............ ....................... ............... .... .... ........ ........ ........ ........ .... 22
9.1 Pro Product duct Strategie Strategies s............................................................................... ........ ..........22 22 9.1.1 Pa Packaging ckaging........................................................................................ .......22 22 9.1.2 Labeling.................................................................. .......................................................................... ................ ................ ............... .......23 23 9.1.3 Product Line.................................................................... ............................................................................ ................ ............... .......24 24 9.2 Pricing Strategies.................................................................. .......................................................................... ................ ............... .......24 24 9.3 Distribution Strategies.................................................. ........ ................ ................ ............... .......24 24 9.4 Pro Promotion motion Strategie Strategies s............................................................................. .......25 25 9.4.1 Environme Environment nt Re Research search....................................................... ............................................................... ................ ............ ....25 25 9.4.2 Adverti Advertising sing................................................................................. ........ ............ ....26 26 9.5 Positi Positioning oning Strategy........................................................... .................................................................... ................. ................ ..........26 26 9.6 Action Plan....................................................................... ............................................................................... ................ ................ ............ ....26 26 10.0 Evaluation, Monitoring and Control............ Control..................... ......... .... ........ ...... ..28 11.0 Budget............ ....................... ....................... ........................ ....................... .............. ... .... ........ ....... ... 29
11.1 Market Analysis Cost................................................................. ......................................................................... ................ ..........29 29 11.2 Questionnair Questionnaire e Cost............................................................................. ........29 29 11.3 Advertising and promotional cost...... ............ ............ ............ ............ ............ ............ ............ ............ ............ ......... ...30 30 11.3.1 Advertising cost..................................................... .............................................................. ................. ................ ............. .....30 30 11.3.2 Promos Cost ...................................................................... .............................................................................. ................ ........... ...30 30 11.2.3 Sponsorships................................................................................ ........30 30 12.0 Bibliography ........... ....................... ....................... ....................... ....................... ........... .... ....... ... 31 Car Dealers Dealer s Survey Summary Su mmary............ ........................ ....................... ............... .... .... ........ .... 33
KBC....................................................................................................................33 . MUST CARS.........................................................................................................33 33 CAR MAX.............................................................................. ......... ................. ................ ............. .....33 33
Consumer Questionnaire ........... .................. ....... .... ........ ........ ........ ........ ........ ........ ........ ....... ... 34
QUESTIONNAIRE ANAL ANALYSIS YSIS.................................................................... ............................................................................ ............. .....38 38 Analysis Summary.......................................................................................... ....43 43 Budget............ ........................ ....................... ....................... ................. ..... .... ........ ........ ........ ........ ........ ....... ... 46
1.0. AUTOMOBILE I NDUSTRY OVERVIEW 1.1. GLOBAL INDUSTRY FOR AUTOMOBILE 1 Automobile Industry is a business of manufacturing and selling vehicles. It has encouraged the expansion of road systems and allowing consumers to commute long distances. It has also allowed other industrial product to contribute as well, such as steel and thus is the key determinant for economic growth. Globalization of automotive industry accelerated exponentially after the 1980’s. This was due to the construction of important overseas facilities and mergers along alongsid side e with with impr improv oved ed prod product uctio ion n techni technique ques s adop adopted ted by Japane Japanese se in the 1970’s. By 2005, the industry’s global output touched 64.6 million vehicles. The auto market today is one of the largest segments in world trade. Today the annual automotive exports have reached a level of $600 billion which accounts for 10% of the worlds export. With With incre increase ase awar awarene eness ss in consu consumer mers s about about potent potentia iall hazar hazards, ds, automo automobi bile le industries are in constant competition with each other to produce a better vehicle for the right right consum consumer er.. It is estim estimat ated ed that that the car car indust industry ry will will contin continue ue to prospe prosperr to increasi increasing ng trends trends as national national economie economies s and populati population on increase increases. s. Mobil Mobility ity 2030, 2030, of the World orld Busine Business ss Counci Councill for Susta Sustaina inable ble Devel Develop opmen ment, t, repor reported ted that that per per capit capita a mobili mobility ty of china, china, Latin Latin Americ America, a, Russia ussia and rest rest of Europe would double by 2030 to 5000-14000 km per year. This will contribute to the automotive industry a big deal.
1
http://imvp.mit.edu/papers/99/shimokawa.pdf
1.2. AUTOMOBILE INDUSTRY OVERVIEW OF PAKISTAN
2
In Pakistan automobile automobile industry is growing growing at a rapid pace. There have been huge demand for for car cars in Pakist istan over ver time ime but in the the last last few few years due to improvement in economy of Pakistan this demand has increased tremendously. Total number of automobiles in use today in Pakistan is 5 million. About two-third of the market demand is being met currently by local production and imports from other countries and one-third is left unmet. So there is a huge gap in market demand and supply which is still there to be met. Major producers currently in the market are Toyota, Suzuki, Nissan, Honda, Mitsubishi, Hyundai. The government is also supporting the investors to invest in Pakistan this has attracted more producers of cars to come in Pakistan and grasp market share from Pakistan automobile market.
2.0. NISSAN: HISTORY 2.1. INTRODUCTION 3 Nissan Motor Co. is one of the major car manufacturers manufacturers in the world. Nissan Motor Co.. is in auto Co automo mobi bile le indu indust stry ry for for over over 70 year years. s. Niss Nissan an has has spr sprea ead d out out its its manufacturing over all major countries and territories of the world. Nissan Motor Co.. foun Co founde ded d in 1934 1934,, form formal ally ly know known n as Dats Datsun un unti untill 1983 1983,, is a Japa Japane nese se automobile manufacturer and is Japan’s second largest company after Toyota. It is among the top Asian rivals of the “big three” in the US. Initially, Nissan produced milit military ary vehicl vehicles es for Japans Japans milita military ry.. Nissan Nissan prod produce uces s an exten extensiv sive e range range of mainstreams mainstreams cars, trucks for domestic and international consumers. In Pakista akistan n Nissa Nissan n is opera operatin ting g in colla collabo borat ratio ion n with with Biboj Bibojee ee Servic Services es (Pvt.) (Pvt.) Limited with local brand name of Gandhara Nissan Limited. Gandhara Nissan Limited was established in 1981 as a private Limited Company and has sale license for distribution of Nissan vehicles. In Pakistan Nissan’s net sales for year ending 30th June 2006 were about Rs. 4 billion. 2
http://www.unescap.org/tid/ http://www.unescap.org/tid/publication/part_two2223_pak. publication/part_two2223_pak.pdf pdf
3
http://www.gnl.com.pk/profile.htm
In Pakistan Nissan has following major cars already in market : •
Nissan Sunny
•
Nissan Patrol
•
Nissan Cefiro
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Nissan Niss an X-T X-Trail
2.2. NISSAN’S VISION 4 Nissan Nissan’s ’s visio vision n is to enhanc enhance e the qualit quality y and and safety safety of trave travell and achie achieve ve customer satisfaction. Nissan focuses on maintain and implement better quality standards to ensure people with more comfortable and safe drive. Ther There e visio vision n is expr express essed ed in their their statem statement ent as: “Nissan-Enriching people’s
Lives.” The significance of this is that Nissan aims to participate in the development and progress progress of society through its business activities worldwide. worldwide. This is only achieved throug through h set of object objective ives s that that needs needs to be focuse focused d and bette betterr imple impleme mente nted d through effectiveness and efficiency.
2.3. NISSAN’S MISSION 5 “Nissan provides unique and innovative automotive products and services that deliver superior measurable values to all stakeholders”
3.0. NISSAN NEXT : MARKETING E NVIRONMENT 3.1. MICRO ENVIRONMENT
3.1.1. CONSUMERS Consumers are the main target which needs to be understood and satisfied in the mark market. et. Their Their purcha purchasin sing g behav behavior ior will will most most likely likely be an impa impact ct affect affecting ing an 4
5
http://www.nissan-global.com/EN/COMPANY/MESSAGE/index.html
http://www.nissan-global.com/EN/COMPANY/MESSAGE/index.html
organization in several unprecedented ways. It is important to understand their mind mindse sett patt patter erns ns of pur purchas chasin ing g a fami family ly car, car, the the basi basic c patte atterrn incl includ udes es affordability, fuel efficiency, safety and comfort giving the consumer a mood of acceptance and appreciation. The main focus of the Nissan will be the low level car owners and low income consumers. It will also target product to bike owners as they are very unsafe.
3.1.2. COMPETITORS With With strong strong econom economic ic growt growth h and gover governme nment nt relax relaxati ation on on taxes, taxes, sever several al companies are emerging to establish their market position. Nissan next stands a good chance of competing with existing competitors as several of Nissan products are already already in the market. Nissan will position the new product with features such attracti attractive ve look-n-fee look-n-feel. l. Direct Direct - competito competitors rs are are Toyota oyota and Suzuki Suzuki which have substantial market share.
3.1.3. INTERMEDIARIES Nissan will adopt both distribution channels, direct and indirect. Intermediaries (i.e authorized dealers of Nissan) are important, since indirect distribution of its product is carried out through them. This will help to further enhance the reachability of the car.
3.1.4. PUBLICS Publics are the general public who are involved in the reputation reputation of Nissan and its products. Nissan has to provide several strategic approaches in order to stand out with the public opinions. Any critics against Nissan would impact the sales and repute. repute. With such diverse culture, culture, consumer consumers s are highly deterr deterred ed with public opinions. This very thin line, the public offers, can effect production, distribution and diversif diversifica icatio tion n of Nissa Nissan. n. Nissa Nissan n will will have have to stand stand out in their their primar primary y objective and not loose that position.
3.2. MACRO ENVIRONMENT 3.2.1. DEMOGRAPHIC ENVIRONMENT
3.2.1.1. Education The literacy rate of the country is increasing and as a result it has increased the consciousness in people about safety and quality of travel. People are now more sensitive about how safe and comfortable is the automobile they are using. With the the incr increa ease sed d awar awaren enes ess s in peop people le they they have have now now shif shifte ted d towa towarrds the the automobiles which are according to safety standards and give more comfortable travel. This shift is also helping Nissan Motor Co.’s business as people are moving towards it.
3.2.1.2. Population Population of Pakistan is increasing at rapid pace and has touched the figures of 150 150 millio million n in year year 2006. 2006. This This incre increase ase in popula populatio tion n has has also also incre increase ased d the number of buyers and expanded the market of automobiles. Requirement of more automobiles has grown. Automobile industry has also responded to this scenario. But there is still a huge gap between people demand and supply of cars. Nissan focuses on this gap and is trying to avail this opportunity opportunity to its best.
3.2.2 ECONOMIC ENVIRONMENT With the rapid growth of national economy purchase power of people has also increased. Also the priorities have changed a lot. The affordability of cars has improved and this resulted in huge increase in the sales of cars. This provides Nissan an opportunity to jump into market with strong impact and grab a major share in automobile industry.
3.2.3. TECHNOLOGICAL ENVIRONMENT Rapid Rapid improvem improvement ent and advance advancements ments in technolo technology gy impacts impacts the automobi automobile le industry a great deal. It impacts the manufacturing, assembling and furbishing of automobiles. New technological advancements pace up the operations; results in more rapid production of cars. Technological improvements also impact Nissan’s operations a great deal and forces towards technological shift. Nissan keeps on
improving its technological structure with time and has to continue its strategy of regular improvements.
4.0. NISSAN NEXT : PRODUCT EVALUATION 4.1. CORE, ACTUAL AND AUGMENTED PRODUCT •
The Core Product is an easily affordable Vehicle for consumers.
•
The Actual Product is “Nissan next ” car which is a new launch of Nissan. It provides its users with an affordable choice to buy and ensures a safe and comfortable travel.
•
Augmented Product Product is the The Augmented the adde added d feat featur ures es this this car car prov provid ides es to its its
buyers. Major add-on features Nissan next provides to its buyers are : o
1 year parts and service warranty.
o
Integrated Tracking System.
o
Highly attractive design.
o
CNG installed in car for user convenience.
4.2. CONSUMER OR INDUSTRIAL PRODUCT? “Nissan next” comes under the category of consumer products as it is designed
and launch launched ed for the satisf satisfac actio tion n and facili facility ty of indiv individu idual al or family family users users of middle class and low-earning income population.
4.3. CONVENIENCE, SHOPPING, SPECIAL OR UNSOUGHT PRODUCT “Nissan next ” is a shopping product, as there is high involvement of buyers while buying cars. They want more information about the product and also this is not dail daily y pur purchas chase e or freq freque uent nt pur purchas chase e prod produc uct. t. Ther There e is a huge huge dema demand nd of affor afforda dable ble and safe safe autom automobi obiles les in the mark market. et. Getti Getting ng a comfor comfortab table le travel travel facility has become a desire of every person as frequency of travel has increased a lot. “Nissan next” will provide users will all three major factors in demand for automobiles i.e. economy, comfort, safety.
4.4. PRODUCT USES AND CONSUMER ACCEPTANCE The consumer acceptance for this car will be highly as people are becoming more and more sensitive towards traveling. People now prefer cars which are more comfortable comfortable and look attractive. Economic strengthening of the country has also improved the economic condition of people resulting in more demand of automobiles. Therefore there is a huge gap in market and Nissan next through its low pricing, more safety and comfort will get huge consumer acceptance.
4.5. DISTRIBUTION – WIDE SPREAD OR NOT? Distribution of “Nissan next” will be widespread as Nissan want to reach all the major areas of the country. It will be launched at all the showrooms and dealers of Nissan.
4.6. SWOT ANALYSIS 4.6.1. STRENGTHS Following are some of the major strengths of company: •
Brand image of Nissan Motor Co. and Gandhara Nissan Limited.
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Variety of Automobiles being produced.
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Local Production of cars / low cost of production.
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Financially Nissan is a strong company.
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High Quality products.
4.6.2. WEAKNESSES Following are some of the weaknesses of the Product and company: •
Currently Nissan has low share in market.
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Nissan next is currently being launched in two varieties only.
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Nissan has small distribution network currently.
4.6.3. OPPORTUNITIES Follo Fo llowin wing g are are some some of the oppor opportun tuniti ities es which which Nissa Nissan n can can avail avail in futur future e to increase its market share: •
Increased awareness of people.
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Improved economic condition of people.
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Increased population/consumption population/consumption
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Increased media influence on people.
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Increased market demand.
4.6.4. THREATS Following are some of the threats which may be faced in the future: •
High competition in the market.
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New Entrants can also add to the competition.
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Presence of other brands in the market and their infrastructure.
5.0 CONSUMER EVALUATION 5.1 TYPE OF PURCHASE DECISION Automo Automobi bile le indust industry ry has a numbe numberr of prod produce ucers rs alrea already dy in marke markett includ including ing Nissan, Nissan next will introduce a new image of the company and will most likely attract consumers as it will be a customized model for the people. Since any consumer will be a long lasting relationship, it is important that it stands out in fron frontt of its its comp compet etit itor ors s and and has has a comp compet etit itiv ive e edge edge.. Ther There e will will be high high involvement of user as it has to make a big purchase decision and also there are competitors like Suzuki and Toyota etc. giving services to people; so this purchase behavior will be categorized as Dissonance-Reducing Buyer behavior.
5.2 CONSUMPTION – CONSUMER RESPONSE Commu Co mmute te has has becom become e a necess necessity ity and mor more road roads s infra infrastr struct uctur ure e has been been established. More people are interested in purchasing as their needs and interests
increases. As competition is on the rise so public is more informed about cars. They are more conscious about the safety and economic features of the car. This awareness and consciousness is increasing the buying and there is already a gap in market so production of Nissan next will be tremendous.
5.3 QUALITY, COMFORT & SAFETY Gandhara Nissan Limited is working in collaboration with its mother company in Japan, Nissan motor Co. Thus it has an international image in local market & public public mind mind stands stands on good good groun grounds ds when when consid consideri ering ng Qualit Quality, y, comfo comfort rt and Design. The new image will provide a new quality, price and comfort pattern which will be very favorable to consumers. Since consumers relationship is going to last, it is important that these variables are constantly improved. Nissan next will be affordable most of all, and safety should be first priority so that the consumer’s first impact would be that this is a car for my family. Design will be unique from the rest of its competitors and will be designed after evaluating customer buying patterns.
5.4 CUSTOMER AWARENESS AND BRAND SWITCHING Sinc Since e this this is a high high valu value e pur purchas chase, e, it is most most lik likely ely that that the the bran brand d loya loyall consumers are loyal to the company and believe that the Nissan products are much better than others. The new car will attract our existing customers as it will contain additional unique features. Nissan next aim is to capture the new market of its level and provide its existing customer a new opportunity to experience a new ride experience. Nissan will provide unique differentiated points to create awareness and presentations proving the consumers the advantages and luxury it can provide to a small family. With increase in awareness in consumer minds, it is imperative that safety features are emphasized and provide core values which the consumers like to see.
5.5 BRAND PROSPECTS -- LOCATION AND INFLUENCE In Pakistan, 30% of the population is living below the poverty level which be translated as earning less than $2 a day and about 5% comes in the bracket of elit elite e clas class. s. Ther Therefo eforre Niss Nissan an next will will prov provid ide e a very ery diff differ eren entt leve levell of
cust custom omiz izat atio ion n to diffe differrent ent loca locati tion ons s whic which h will will be favo favora rabl ble e to lowlow-in inco come me families. Most of them travel by bikes and buses. Nissan will introduce a better shift to its new car which is Compaq, secure and most economical.
6.0 COMPETITOR A NALYSIS Major competitors of “Nissan next” are Suzuki, Toyota, Hyundai and Cherry QQ. All All prod produc ucts ts of thes these e comp compan anie ies s of same same size size and and capa capaci city ty will will give give toug tough h competition competition to “Nissan next ”. ”.
6.1 PRICING As makin making g cars cars more more affor afforda dable ble is the major major objec objectiv tive e of launch launching ing this this car car ther theref efor ore e the the pric prices es of this this car car are are kept ept lowe lowerr than than that that of all all the the cur current ent comp competi etito tors rs in the marke market. t. This This will will help help grasp grasping ing large largerr mark market et share share and compete well in market. •
CNG plus AC car will be available at Rs. 3, 50,000 only.
•
Only AC car will be available at Rs. 3, 15,000 only.
6.2 PROMOTION Major competitors of “Nissan next” like Toyota and Suzuki; are spending huge reven evenue ue on prom promot otio ion n of thei theirr bran brand d and and prod produc ucts ts.. Niss Nissan an will will also also mak make exten extensiv sive e effor effortt and heavy heavy invest investmen mentt on creat creating ing awar awarene eness ss about about “Nissan next” in market. Promotion of “Nissan next” will be done at nation wide scale as
Nissan aims at targeting all major areas of country.
6.3 DISTRIBUTION Nissan has currently distribution setup in the major divisional headquarters only but the competi competitors tors speciall specially; y; Toyota oyota and Suzuki Suzuki has a wider wider network. network. There There presence in more areas than Nissan is giving tough competition to Nissan. For Nissan next , Gandhara Nissan Limited will come up with a new strategy of distribution to reach all those areas where there they are not currently present.
6.4 FUTURE COMPETITORS AND R EPLACEMENT EPLACEMENT PRODUCTS In future the most effective competitor for “Nissan next” can be a small car from Honda Limited. Honda is a large car manufacturing company but not currently producing small cars in Pakistan. Therefore a step of producing small cars by
Honda can give tough time to Nissan next. Nissan should develop strategy to cope with the situation if Honda also jumps into the market with small cars for consumers.
7.0 MARKETING OBJECTIVES The goals and objectives of the marketing marketing plan are usually defined under the light of certain performance indicators which are related to the probable increase in growth, sales and performance levels in terms of increasing overall company revenues revenues and image. Marketing Marketing objectives leads to the increased sales if they are clear and understandable For “Nissan next” we’ll define performance parameters and baseline in light of Nissan’s vision to achieve customer satisfaction. Also the growth of automobile indu indust stry ry in Pak akis ista tan n and and incr increa ease se in dema demand nd of auto automo mobi bile les s is kept ept unde underr consideration.
GOALS AND OBJECTIVES •
Capture at least 25% of market share for small cars in defined Target market.
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Occupy second position in the market following Suzuki Motor Company.
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Target middle class and low earning income class specially by providing them an affordable option.
•
Crea Cr eate te
awar awaren enes ess s
amon among g
targ target et
audi audien ence ce..
Use Use
exces xcessi sive ve
adve advert rtis isin ing g
especially using media preferred by the target market. •
Use unique features like good design, low prices and comfortable environment to create attraction towards product.
•
Create product belonging and position among buyer’s mind.
8.0 MARKETING STRATEGIES This section of the plan basically outlines Nissan’s plan to achieve its objectives that are mentioned above as well, it is the most essential part of the marketing plan.
8.1 TARGET MARKET Nissan nexc target market will be the low-level income group, middle class and bike owners. Bike owners are the most critical as large number of consumer curr curren entl tly y in Pak akis ista tan n trav travel el throu through gh bik bikes. es. Safe Safety ty haza hazard rds s of this this type type are are tremendous considering the increasing number of accidents that occur due to unsafe bikes. With constant awareness and education about Nissan affordability and safety features, this type of group could be acquired resulting in increase of brand loyal consumers. People are more aware and therefore, they are constantly more
partic rticul ula ar
when hen
decid ciding ing
whi which
car
to
purch urcha ase. se.
With ith
stra strattegi egic
advertisement, consumers can be attracted with its latest features and a new image Nissan will provide to owners.
8.2 NISSAN NEXT TARGET MARKET: GEOGRAPHIC SEGMENT The major concern of Nissan next is to capture all the district headquarters of the country resulting in its coverage of almost all over the country.
8.3 NISSAN NEXT TARGET MARKET: PSYCHOGRAPHICS With new image Nissan next will provide to its buyers, owners will feel more confident and proud considering that Nissan is an international organization with strong background resulting driving Nissan next a status symbol. Also safety and comfo comfort rt are are big factors factors of consi conside derat ration ions s in a consum consumers ers mind mind so Nissa Nissan n by focusing on these factors will attract safety and comfort conscious people. Seeing its potential, consumers will most likely shift to Nissan next .
8.4 NISSAN NEXT TARGET MARKET: DEMOGRAPHICS Prima Primary ry Targe argett mark market et belon belongs gs to middle middle class, class, upper upper middl middle e class class and low earning income people in society, falling in income bracket of below Rs. 50,000.
Also the target will be people from 25 - 60year old who are major automobile buyers.
9.0 MARKETING MIX STRATEGIES “Nissan next’s” marketing efforts will be based on the priority of expanding its
marke markett share share and incre increase ase the brand brand loyalt loyalty y among among buyer’ buyer’s s by achiev achieving ing customer satisfaction. Nissan is launching “Nissan next” at this particular time because of boom in the automobile industry in Pakistan. The demand of cars for private usage is increasing a great deal but there are a few car production companies currently in the market. Nissan feels that there is a very good opportunity to jump into the market at this time with a quality product and grasp a major share in market.
9.1 PRODUCT STRATEGIES The name of the car will be “Nissan “Nissan next” . It should be a highly quality
product focusing on three important parameters of economy, safety and comfort to compete the major competitors in the market i.e. Suzuki and Toyota.
9.1.1 PACKAGING Nissan next will be built on one standard size. It will be available in both color types i.e. Metallic and Non-Metallic. The color range will be 5 major colors red, white, black, blue and green with capacity to increase other colors on demand. The design of the car will be smooth and catchy.
Imp. Recommendations •
The shape of the car should be kept different from the shape of competitor’s products.
•
The design of the car is recommended to be kept innovative and unique in order to attract customers.
•
The design should also be kept on improving on regular basis.
9.1.2 LABELING The Label of car presents only basic information about the car i.e. brand name and car name.
Imp. Recommendations The name of the car proposed is “Nissan next”. The name represents innovation and movement ahead as is the plan to move the car ahead of its competitors in aspects like Affordability, comfort, design and safety. The label of the car should be innovative and attractive. The fonts used should be decent and attractive. Only precise text should be presented.
9.1.3 PRODUCT LINE Nissan next will be available in two major types of cars: 1. Nissan next CNG/AC 2. Niss Nissan an next next AC
Imp. Recommendations It is recommended both products should be launched simultaneously with major production and share to CNG car as demand of CNG is much more than that of simple simple car car. After After three three month months s time time a surve survey y should should be conduc conducted ted to judge judge customer’s response to the car.
9.2 PRICING STRATEGIES The price of the cars will be as following: •
Nissan next CNG/AC
•
Nissan next AC
------------- Rs. 3,50,000/----------------
Rs. 3,15,000/-
Imp. Recommendations The price of the car should be kept lesser than the competitors as Nissan next’s major objective is providing economical car to users. Also the target market of the car is Middle and low income class so it should be kept in their affordability. This is acco accomp mpli lish shed ed by reduci educing ng the the over overhe head ad cost costs s lik like OW OWN N paym paymen entt etc. etc. by developing developing efficient distribution mechanism.
9.3 DISTRIBUTION STRATEGIES Basi Basica call lly y ther there e are are two two type types s of dist distri ribu buti tion on chan channe nels ls avai availa labl ble: e: Direct distribution distribution and In-direct distribution distribution
Recommendations Nissan next will adopt both distribution channels for distribution of car. Use Us e of Dire Direct ct Chan Channe nel: l: Niss Nissan an has has its its show showrrooms ooms in majo majorr divi divisi sion onal al
headquarters; headquarters; at these stations Nissan next will use its direct distribution channel.
Also Also it is recom recommen mende ded d to incre increase ase the direct direct distri distribut butio ion n covera coverage ge area area by setting up showrooms in more areas to have better control over distribution. Use of In-dir In-direct ect Channe Channel: l: In thos those e area areas s wher where e Niss Nissan an does doesn’ n’tt have have its its
showrooms it will use its chain of authorized dealers to sell out its cars in these areas.
9.4 PROMOTION STRATEGIES Promotion is one of the most important factors of marketing; it is done to affect the consumer behavior in order to achieve sales and increase product image. In promotion the major task is to make consumers aware of the product and to attra attract ct consum consumer er towar towards ds the prod product uct by highli highlight ghting ing the adva advanta ntages ges of the prod produc uct. t. Also Also it kee eep p cons consum umer ers s awar aware e and and well well info inforrmed med abou aboutt prod produc uct’ t’s s features and improvements.
Recommendations •
Nissan can use electronic and print media to advertise about its car.
•
Nissan can advertise on billboards, flex signs, bus boards, telemarketing etc.
•
Special advertisement campaigns can be launched e.g. seminars, road shows publications etc. to create awareness about Nissan next.
•
Nissan will sponsor special events like concerts etc. to introduce the car to public.
ESEARCH 9.4.1 ENVIRONMENT R ESEARCH
An exten extensiv sive e marke markett resea researc rch h will will be conduc conducted ted to have have bette betterr idea idea about about consumers’ perception about Nissan and its competitors. For this purpose Nissan will acquire services of marketing and research agencies to better analyze market environment. environment. This will enable Nissan to learn about the consumers’ behavior, how they perceive us and compare with the competitor. The media of the advertising a prod produc uctt is alwa always ys chos chosen en afte afterr the the mark arket envi envirronme onment nt resea esearrch to get get knowledge knowledge that if the target audience is interested interested in that mode of advertisement or not
9.4.2 ADVERTISING To advertise the product better and create awareness about product; Nissan will use different advertisement advertisement methods to approach approach the consumers. The diversity of advertisement advertisement channels will help in reaching the masses of different mindsets. mindsets. Following Advertisement methods will be used: •
Nisa Nisan n will will use use prin printt and and elec electr tron onic ic medi media a to intr introd oduc uce e the the prod produc uctt to consumers.
•
Special events will be sponsored by Nissan.
•
Use of Billboards, flex signs etc for massive introduction introduction of car’s launch.
•
•
Special road shows and displays will be set at dealers outlets. Prize contest will be conducted to attract people towards the car.
9.5 POSITIONING STRATEGY Nissan next will use the image of NISSAN MOTOR CO. and hope that it will attract the customers towards the car. Also Nissan next’s extensive extensive marketing marketing with focus on its special features like economy, safety and comfort will draw attention of buyers and create room for the product in the market.
9.6 ACTION PLAN The action plan will commence from the month of January 2007 and will go up to June 2007. PROMOTION ACTIVITY
Launch a blind ad campaign on billboards
DURATION
2 weeks
and magazines in all A class areas of major
RESPONSIBILITY
Marketing department
cities and magazine. Heavy advertising on TV, newspapers and
4 weeks
magazines Sponsor a highly prestigious chain of events or concerts.
Marketing department
3 weeks
Marketing department, Finance
Department Set displays of car at all the Nissan
3 weeks
showrooms and major dealer outlets in all
Marketing department
cities. A contest will be held and people who win
April
Finance
will get prizes (Car Info. Books, Key chains,
Department,
phone cards etc.)
Marketing Department.
Reduce number of billboards, television and
May
magazines advertisements. Continue Advertising
Marketing department
June
Marketing department
10.0 EVALUATION, MONITORING
AND
CONTROL
The goal of the marketing plan is to outline the strategies, tactics, and programs that will make the sales goals outlined in the Nissan next business plan a reality by the end of the season. There are a number of KPI ’s which are needed to be measured for better evaluation of the performance. revenue generatio generation n, the The The mont monthl hly y and and the the annu annual al revenue then the the amount ount of expenses expenses incurred incurred in a mont month h or in a year year,, then then the the incr increa ease sed d leve levell of customer satisfaction and ensuring the brand loyalty..
Forr compl Fo complyi ying ng with with these these scenar scenarios ios the advert advertisi ising ng effort efforts s made made by the company, str distribution tion channels channels, launc unch of the new strengt ength h of the the distribu products and the pricing will be measured. The possible increase in growth of
the target market also depend all these efforts made by Nissan next . The people who are responsible for the monitoring and control of the marketing plan involves, the Marketing Executives, Sales Managers, Media Managers, Market Research Departments, and the Production Managers. Some Some activi activitie ties s must must be carr carried ied out for preci precisel sely y and closel closely y evalu evaluati ating ng the effe effect ctiv iven enes ess s of the the stra strate tegi gies es and and tact tactic ics s for for exam exampl ple e the the gath gather erin ing g and and structuring of data regarding market, product, consumers and the pricing trends, then the generation of daily sales report should be maintained and then in the end conti continuo nuous us reco reconfir nfirmin ming g of the mark marketi eting ng budge budgett and activi activitie ties s by the managers of different divisions.
11.0 BUDGET As Nissan has a tough competition with some big names like Suzuki and Toyota so there is need of strong financial support to all marketing activities. Nissan has allocated initially initially Rs. 30 millions for the marketing marketing of Nissan next . This budget will be used during the fiscal year of 2006-2007. This amount will be further sub-allocated to different areas. Rs. 15 millions has been allocated to the budget of initial cost for the marketing analysis and all activities of advertising and promotion during first quarter of the year. For the continuity of the promotional and advertisement activities Rs. 15 millions has been sub-allocated for each quarter over the years as Rs. 5 million per quarter. •
T The hese se allo alloca cati tion ons s of fina financ nces es can can be alte alterred with with respe espect ct to the the futu futurre requirements
11.1 MARKET ANALYSIS COST Nissa Nissan’s n’s mark marketi eting ng depa departm rtment ent includ includes es profe professi ssiona onals ls for mark market et analys analysis, is, competitor analysis, etc. These people are advised to do their best and for more extensive approach. Nissan has also acquired the services of marketing research and analysis agencies for better approach and more in-depth research. The cost estimated for market research is Rs. 2 million. The The furt furthe her r subd subdiv ivis isio ion n of this this cost cost is given given belo below w in tabl table e 1.2 1.2 in Appendix B.
11.2 QUESTIONNAIRE COST Nissan’s has conducted an extensive questionnaire with general public to have better idea about the mindset and understanding of general public. This survey costs costs for its developm development, ent, executi execution on and then process process of interpr interpretat etation. ion. Cost estimated for this survey is Rs. 1 million. The The furt furthe her r subd subdiv ivis isio ion n of this this cost cost is given given belo below w in tabl table e 1.3 1.3 in Appendix B.
11.3 ADVERTISING AND PROMOTIONAL COST The cost allocated for advertising and promotion is Rs. 12 million. This cost is allocated to the areas of advertisements, sponsorships, promos, etc. The The furt furthe her r subd subdiv ivis isio ion n of this this cost cost is given given belo below w in tabl table e 1.4 1.4 in Appendix B.
11.3.1 ADVERTISING COST Advertising costs includes advertisement on electronic media, print media (news pape papers, rs, magaz magazine ines, s, etc.), etc.), billb billboa oard rds, s, road road shows, shows, displa displays ys etc. etc. etc. etc. These These all activities have been allocated allocated Rs. 8 million. The The furt furthe her r subd subdiv ivis isio ion n of this this cost cost is give given n belo below w in tabl table e 1.4. 1.4.1 1 in Appendix B.
11.3.2 PROMOS COST Promo cost includes the cost of handouts; information books, prize contests etc. these all promo activities will cost around Rs. 2 million. The The furt furthe her r subd subdiv ivis isio ion n of this this cost cost is give given n belo below w in tabl table e 1.4. 1.4.2 2 in Appendix B.
11.2.3 SPONSORSHIPS Nissa Nissan n will will sponso sponsorr differ different ent event events s like like concer concerts, ts, semina seminars rs and other other socia sociall activities etc. etc. to promote promote the car in in masses and attract attract people. This sponsorship of a chain of activities over time will cost about to Rs. 2 million. The The furt furthe her r subd subdiv ivis isio ion n of this this cost cost is give given n belo below w in tabl table e 1.4. 1.4.3 3 in Appendix B.
12.0 BIBLIOGRAPHY
ALLEN, G. (1998). Introduction to Marketing . Addison-Wesley. Fifth Edition. London. SAMUEL, B. (2003). Marketing for Beginners . Pearson Education . 2nd Edition. Boston. MERCER, D. (1996). Marketing . Blackwell Publishing . 2nd Edition. London. MINETTE, S. (2001). B2B Marketing . Pearson Education . Revised Edition. Boston. ALBERTO, J. (2005). Strategy Moves . Pearson Education . 1st Edition. New York.
Appendix A
CAR DEALERS SURVEY SUMMARY
KBC Suzuki and Toyota are enjoying the most market share in Pakistan with about 40% and and 35% 35% respe espect ctiv ivel ely y. Suzu Suzuki ki is succ succes essfu sfull due due to its its loca locall prod produc ucti tion on and and economical cars but they have major problem of sustainability and designs of their cars. Toyota is enjoying good market share because of good quality and extensive production. If Nissan is launching new car and want to grasp market share then it has to focus on designs of cars and also provide more affordable option to buyers. Also Toyota and Suzuki do good marketing and to beat them Nissan must develop efficient marketing strategy.
MUST CARS Due to incre increase ase in econom economic ic activ activity ity in the countr country, y, dema demand nd of automo automobil biles es especially cars for private use have increased hugely. Currently Suzuki is enjoying the major share in the market due its affordable cars, availability of spare parts and good marketing. Suzuki is dominating the market but there are a lot of problems which are being faced by users. Especially the week areas are design and safety standards. If Nissan wants to compete with Suzuki in the market and break into its dominance it should provide buyers with highly excellent designs of cars and also cars which are safe and comfortable to travel.
CAR MAX The most important parameters while buying cars a buyer looks for are its Price, Safe Safety ty stan standa dard rds, s, Desi Design gn of car car and and how how much much comf comfor orta tabl ble e the the vehi vehicl cle e is. is. Currently some of the cars implemented the design, safety, comfort standards are very very expe expens nsiv ive e and and huge huge mark market et shar share e goes goes to thos those e cars cars whic which h are are less less standardized but are cheap. Nissan can stand in market and be successful if it
make an ideal combination of Affordability, design, safety, comfort and make a better and cheap product for buyers. Currently less quality cars of Suzuki are enjoying bulk of market share due to lack of better options available in market. Nissa Nissan n is curre currentl ntly y not so much much succes successfu sfull in Pak akist istani ani mark market et but they they can can improve their position by focusing at this area and developing effective marketing strategy to break the influence of Suzuki and Toyota.
CONSUMER QUESTIONNAIRE What is your Gender ?
a. Male b. Female
What is your age ?
a. 18-25 b. 25-35 c. 35 an and ab above
What is your income?
a. Below 50,000 b. b. Abov Abovee 50,0 50,000 00
Do you use Nissan cars ?
a. Yes b . No
What comes to your mind when you think about Nissan ?
a. Affo Afforrdabl dablee Cars Cars
b. High quality Cars c. Trust ust Worth orthy y d. Expe Expens nsiv ivee Car Carss
e. Safety f. High High bran brand d image mage
How satisfied are you with Nissan?
a. Very ery sati satisf sfie ied d b. Satisfied c. Neutral
Do you own a car ?
a. Yes b . No
If yes, which car do you prefer ?
a. Toyota b. Suzuki c. Nissan
d. Others, please specify
…………….
Do you prefer public transport to private cars ?
a. Yes b . No
Are you satisfied with safety of cars already in market ?
a. Yes b . No
What is your major preference when buying a car?
a. Price b. Safety c. Comfort d. Design e. Other Other plea please se speci specify fy ………. ……….
What power of car do you prefer?
a. 800 cc b. 1000 cc cc c. 1200 cc or or mo more
What type of color you like?
a. NonNon-M Metal etalli licc b. Metallic
How satisfied are you with prices of cars in market ?
a. Satisfied b. Not - Satisfied c. Neutral
How much are you willing to pay for 1000 cc. Cars ?
a. Rs. 300, 000/-
to Rs. 450, 000/-
b. Rs. 450, 000/-
or more. more.
If one of the companies plans to launch a new car of great design, safety, comfort and affordable which one you will prefer?
a. Toyota b. Suzuki c. Nissan d. Loca Locall comp compan anie iess
e.
Other please specify
What influences your buying decision ?
a. TV ad b. Magazine c. Word ord of mout mouth h d. Bill bo board e. Other Other,, Pleas Pleasee spec specify ify ……………… ……………….. ..
QUESTIONNAIRE QUESTIONNAI RE ANALYSIS ANALYSIS Gender 60 e 50 g a %40
30 20 10 0 Male
Female Gender Type
Income 70 60 50 e 40 g a %30
20 10 0 Below 50 50000
A bov e 50000 Income Income group
Age Group 45 40 35 30 e 25 g a %20 15 10 5 0 1 8- 2 5
25 - 40
40- 60
Age Grouping
A bov e 60
Do you use Nissan Cars? 100 90 80
e g 70 a %60
50 40 30 20 10 0 Yes
No
Are you satisfied with Nissan cars? 70 60 50 40
e g 30 a % 20
10 0 Ver y satisfied
Sat is isfied
Neutr al al
Which Car brand do you prefer? 45 40 35 30
e g25 a %20 15 10 5 0 Toyota
Suzuki
Nissan
Other
Do you prefer Public transport to Private Private Cars? C ars? 80 70 60 50
e g a 40 %
30 20 10 0 Y es
No
Are you satisfied with safety of cars already in Market? 80 70 60 e50 g a 40 %
30 20 10 0 Yes
No
What is your major preference when buying buying cars? c ars? 60 50 40 e g a 30 %
20 10 0 Pr ic e
Saf ety
Comf or t
Des ign
Other
W ha hatt power of car do you prefer? 60 50 40 e g a 30 %
20 10 0 800 c c
1000 c c
1200 c c or mor e
W ha hatt type type of c olor you prefer? 70 60 50 e 40 g a % 30
20 10 0 Non- Metallic
Metallic
How satisf satisfied ied are you with with prices of cars in market? 60 50 40 e g a 30 %
20 10 0 Satis f ied
Not- Satis f ied
Neutr al
How much are you willing willing to pay for fo r 1000 cc c c Car? 90 80 70 60 50
e g a % 40
30 20 10 0 3,00,000 - 4,50,000
4,50,000 or mor e
If any one of the the comp c ompany any launches launches a car whichone whichone you will prefe r? 35 30 25 e 20 g a % 15
10 5 0 Toy ota
Suz uki
Nis s an
Loc al Companies
Other
W hat influences influences your buying buying decision? 45 40 35 30 e 25 g a 20 % 15 10 5 0 TV ad
Magaz ine
Wor d of Mouth
Billboar ds
Other
ANALYSIS SUMMARY According to survey people with an income bracket less than Rs. 50,000 per month month prefe prefers rs buying buying small small cars cars for their their priva private te use. use. A larg large e perc percent entag age e of people prefer buying their own cars then to use public transport but most of them are not satisfied with the safety standards of the cars in the market. There is very less market share of Nissan in the market i.e. about 8 % while its competitors are enjoying large share. People using Nissan cars are not greatly satisfied with the car and they expect Nissan to do more. According to survey the most important considerations by a buyer of car are price, safety, comfort and design with price having major influence. About 65% of the people surveyed were of age group 25 to 60 who are the major buyers. Most of the buyers are not satisfied with the prices of the cars and are willing to buy 1000 cc. cars for Rs. 3,00,000 to Rs. 4,50,000 but most of the cars in the market get more out of them as they are expensive. They consider Toyota and Suzuki more successful in launching a new car in market than Nissan. People seem to be more highly influenced by the TV ads and billboards.
Appendix B
Age Structure Graph 1.1 0-14 ye years
15-64 ye years
65 an and above
60 50 40 30 20 10 0
percentage population
Table 1.1 Age Limit
Percentage Population
0-14 years
41%
15-64 years
55%
65 and above
4%
BUDGET
Table 1.2 Market Analysis Cost Wages and Salaries
Rs.
1 Professional Cost 2 Team Leader 3 Team Members Research Agencies Cost
Rs. 500,000 Rs. 50,000 Rs. 150 000 Rs.
Grand Total:
Rs. 2
Table 1.3 Questionnaire Cost 1 Develo ment Cost 2 Execution Cost 3 Inter retation Cost Grand Total:
Rs. 200 000 Rs. 600,000 Rs. 200 000 Rs. 1
Table 1.4 Advertising & Promotional Cost Table 1.4.1 Advertisin
1 2 3 4 Table 1.4.2
Bill Boards etc. TV/ Cable Networks News Pa er Ma azines Dis la s & Roadshows etc.
Rs. Rs. Rs. Rs.
Hand outs etc. Prize Contest
Grand Total
S onsor sh shi S onsorshi
Rs.
2
Rs.
2
Rs. 500 000 Rs .
S onsorshi s
1 2
8
2 million 3 million 1 million 2 million
Promos
1 2 Table 1.4.3
Rs.
of co concerts Rs R s. 1 million of social Rs. 1 million Rs.
12