Description
It analyses the marketing strategies for a gym based in Goa. It covers basic marketing strategies, segmentation for a gym.
Marketing Plan for Body Power Gym case study
Table of Contents
PART A – Market and Consumer Profile
1. Executive Summary 2. Situation Analysis a. Industry Analysis b. SWOT Analysis c. Competitive Forces d. Customer Analysis 3. Marketing Environment for consumer behavior analysis
PART B – Marketing Strategy
1. 2. 3. 4. Segmentation and Targeting Positioning Marketing Mix Review and Control
Executive Summary
‘Body Power’ is a gymnasium located in Goa. The gymnasium was started by Mr. Pereira in 1963. The company has been in an expansion phase since Robert Pereira took over the control of the company from his father in 1987. The company has seen an increase in its asset base and also in the customer base. As on 2002 the revenue of the company is around 10lakhs. Robert Pereira has designed a new multi tasking, body strengthening device and plans to manufacture it on a large scale. The equipment is highly flexible and allows an array of exercises. Large scale manufacturing of the product is seems viable option. However developing a marketing plan poses a problem due to lack of expertise.
Marketing Plan Part 1: Market and Consumer Profile
Situation Analysis Context
Industry Analysis
The case facts indicate that the fitness/gymnasium industry in India is an old and well established one, and in an organized and commercial form dates back its beginning to the 1960s. The industry has developed with time and emerged into a more organized and customer-oriented industry, coming out with customized and otherwise better products and services to address the needs of the customer better, i.e. it has understood and addressed the fitness needs of customers more comprehensively with time by coming out with goal-oriented gym equipments for body-building, body-maintaining, body strengthening, weight reduction etc. The industry has been well supported by the supplier industry (metal, plastic, cloth, leather components). Globally the industry is more developed as compared to the Indian industry (as can be seen by Exhibit 1 which shows the presence of more international brands of gym/exercise equipment than indigenous brands in the Indian market. It enjoys nationwide presence as compared to the Indian counterparts, most of which are local players vying to expand their markets geographically and otherwise. The industry has emerged from the one in which the customer walks in to the gym to exercise to the one reaching out to its customers by selling them versatile exercise equipments. In the process it has created new markets for itself comprising of institutional buyers like hotels, gymnasiums, corporate, condominiums, social clubs and beauty parlors. Hence we see that the industry is in a phase of rapid growth and evolution and there is a lot of latent and unfulfilled demand for fitness, making the future prospects for the industry bright.
Company analysis
SWOT Analysis of Body Power Ltd
Strengths Superior domestic product Easy availability of good quality raw material Local Brand strength – Established well known reputation with a positive history Existing Customer Base Opportunities Threats Weaknesses Brand Strength only as a Gymnasium and not as a fitness equipment manufacturer
Support from Sports Goods Distributor Cheaper domestic substitutes with National presence Favorable demographic profile and Better perception of international brands
changing lifestyles Less domestic competition Growing Target segment
Competitive Forces
The competitors for Body Power can be classified into two ? ? International Companies Regional Manufacturers
International Companies Brands such as “Body Solid”, “Precord”, “Spark”, “Excer”, “Relax” are the main International companies, which are competing in the same space. The Evaluation from the institutional buyers show that these brands fare better in the performance attributes such as “Ease of Operation”, “After Sales Service”, “Multitasking” and in style attributes such as “Design Aesthetics”. These brands are also perceived better than the Indian Brands by the customers. On the other hand these brands are also priced high, where an opportunity window opens for “Body Power”. Regional Manufacturers There are very few regional players in this market. “Do Well” is one such company. Though the prices are quite low, their products are rated very average in the performance and style attributes.
Customer Analysis
The target customers for Robert’s product are: ? ? ? ? ? ? Hotels Gymnasium run by individuals like him Flats/Condominiums Corporate office and factories Social clubs and, Beauty parlors
Most of the customers for Robert’s product are institutional buyers. These institutional buyer measures the products on various attributes before purchasing it. Some of the attributes are: ? ? ? ? ? Ease of operation After sales services Multitasking Speed of impact on body and, Space occupied
Customers who tried Robert’s product were satisfied in terms of multitasking and the flexibility that the machine provided compared to other products in the same category. Also the product and the proprietor have visibility and have established credibility in the local market of Goa. From exhibit 2 we can make out the top 3 potential states for the product with respect to different institution: ? ? ? ? ? ? Hotels: Karnataka, Maharashtra, Andhra Pradesh Gymnasium: Andhra Pradesh, Karnataka and Maharashtra Corporate: Tamil Nadu, Gujarat and Maharashtra Condominiums: Karnataka, Maharashtra and Tamil Nadu Social Clubs: Goa, Maharashtra and Haryana Beauty Parlors: Maharashtra, Goa, Tamil Nadu and Andhra Pradesh
Marketing Environment
Marketing Environment for Consumer Behavior Analysis
A market research study was conducted with the help of an agency to determine the nature of the demand and size of the potential customer base. In addition, the research helped to determine the qualitative aspects of the consumers’ i.e. behavioral aspects as well as institutional buying behavior. Some of the main findings from this survey are as below: People who did exercise were broadly classified into: ? ? People who did passive exercises People who did active exercises with the help of body strengthening equipment o They considered that the benefits were that it made them feel good, helped to maintain their body, helped in weight reduction and muscle building
Reasons for choosing and identifying the equipment: Some of the factors used by people who did active exercises for evaluating the usefulness of the machine included: ? ? ? Flexibility of the machine Ease of operation Multi tasking
?
Time required for completion and usefulness to specific part of the body
Factors used by institutions for assessing the usefulness of the equipment: The factors which were considered are listed in Exhibit 1 of the case study.
Marketing Plan Part 2: Marketing Strategy
Marketing Program
Target Market & Segmentation Strategy
SEGMENTATION VARIABLES AND BREAKDOWNS FOR BODY POWER MAIN DIMENSIONS Geographic Segmentation Region The demand for the product varies from state to state. We can segment the market along these lines. The states of Goa and Maharashtra, Karnataka and Andhra Pradesh have the high demand. Demographic Segmentation Age Occupation Income The customer base can be segmented as medium income and high income. The concerned age group will be from 18 to 40 years. The consumer base can be segmented as students, professionals, house wives. Psychographic Segmentation Health conscious The market can be segmented according to the health consciousness of customers, as ignorant, aware and concerned. VARIABLES BREAKDOWNS
Based on the case facts and the findings, we believe that Mr. Robert should target the high and middle income professionals (employed in corporate), students of the age 18-25. In addition to this, Mr. Robert should also target the young male body building professionals. For these customers, the most likely places where they would end up going would be gymnasiums, corporate offices. This would be across all the states mentioned above. Along with this, within Goa, Mr. Robert should also target hotels given that there are going to be tourists. To rope in high income consumers in cities, condominiums should be targeted.
Positioning Strategy The factors to be considered while deciding the positioning strategy are: ? ? ? ? Additional features provided by the product. Lower price when compared to imported products. User friendly and convenient. Multi functional and multitasking.
Considering all these, the product should be positioned as a ‘value for money’ product, that is convenient, cost effective and multi functional.
Marketing Mix
Product- The product is standardized, an additional luxury variant will be provided with leather upholstery. Pricing- As decided by Mr. Robert the price will be fixed between 35000 to 40000 Rs. depending on the variants selected by the customers. Distribution Channels- Whole sale distributor will be used for the states of Maharashtra, Karnataka and Andhra Pradesh. For distribution strategies within Goa, the manufacturer can adopt direct distribution.
Promotion Strategy ? Advertisements:1. Health Magazine – Advertising in health magazine will create visibility and awareness about the product. Detailed description of the product can help in educating the potential buyers and end customers about the product. 2. Internet advertisements – Internet ads would also act as an advertising channel. In addition a small video clips highlighting the usage and benefit of the machine can be provided. Such clips can be uploaded on popular search engines like YouTube. 3. Direct Advertisements: Booklets highlighting the benefits, usage and workout schedule can be sent to selected potential customers like lead gymnasium owners. ?
Tie ups with Institutional Buyers: - Gymnasiums form a major segment of the market. It will be a good idea to tie up with the Gymnasiums chains e.g. Talwalkar’s, VLCC etc and with standalone gyms which are famous in local markets. Within Goa he can have tie-ups with 3 star and 5 star hotels.
?
Money back Guarantee: - This is a yet to be established brand and the price tag is not cheap. Hence first timers will be quite sceptical about purchasing it. Hence Mr. Roberts should offer money back guarantee in case the customers are not quite happy with the results. Apart from boosting sales this would also speak volumes about the confidence Mr. Roberts has on this product. This would help in establishing credibility.
?
Tie ups with malls: During weekends Mr.Roberts can have stalls in malls (Goa only) to promote his product. Malls being places where high footfalls are generated he can generate a lot of interest about his product. There the customer would also get a firsthand experience of touch and feel about the product which is very important in case of fitness related equipments. Goa being a tourist destination there will be lot of people from neighboring states also and this would also result in word of mouth publicity.
?
Sponsorship of body building events – Since body building events attract a lot of fitness and gym enthusiasts sponsorship of such events would help in creating awareness and create more excitement about the product.
Review and Control – Mr. Roberts will be preparing simple, decision friendly, weekly, monthly and annual reports which would be focussing on – ? ? ? ? ? Revenue and unit sales Expenses Distributor commissions Customer feedback Competitor activities
Marketing organization – Mr. Roberts will be in charge of the marketing function. He can have an assistant who can help him in taking orders, doing tie- ups, recording sales, etc. As the business expands further in the next 5-10 years he can have sales managers who will take care of specific markets. E.g. the entire 4 states of south India could be classified as one market, whereas Maharashtra being a big market would require a single manager exclusively for its requirements.
doc_957540425.docx
It analyses the marketing strategies for a gym based in Goa. It covers basic marketing strategies, segmentation for a gym.
Marketing Plan for Body Power Gym case study
Table of Contents
PART A – Market and Consumer Profile
1. Executive Summary 2. Situation Analysis a. Industry Analysis b. SWOT Analysis c. Competitive Forces d. Customer Analysis 3. Marketing Environment for consumer behavior analysis
PART B – Marketing Strategy
1. 2. 3. 4. Segmentation and Targeting Positioning Marketing Mix Review and Control
Executive Summary
‘Body Power’ is a gymnasium located in Goa. The gymnasium was started by Mr. Pereira in 1963. The company has been in an expansion phase since Robert Pereira took over the control of the company from his father in 1987. The company has seen an increase in its asset base and also in the customer base. As on 2002 the revenue of the company is around 10lakhs. Robert Pereira has designed a new multi tasking, body strengthening device and plans to manufacture it on a large scale. The equipment is highly flexible and allows an array of exercises. Large scale manufacturing of the product is seems viable option. However developing a marketing plan poses a problem due to lack of expertise.
Marketing Plan Part 1: Market and Consumer Profile
Situation Analysis Context
Industry Analysis
The case facts indicate that the fitness/gymnasium industry in India is an old and well established one, and in an organized and commercial form dates back its beginning to the 1960s. The industry has developed with time and emerged into a more organized and customer-oriented industry, coming out with customized and otherwise better products and services to address the needs of the customer better, i.e. it has understood and addressed the fitness needs of customers more comprehensively with time by coming out with goal-oriented gym equipments for body-building, body-maintaining, body strengthening, weight reduction etc. The industry has been well supported by the supplier industry (metal, plastic, cloth, leather components). Globally the industry is more developed as compared to the Indian industry (as can be seen by Exhibit 1 which shows the presence of more international brands of gym/exercise equipment than indigenous brands in the Indian market. It enjoys nationwide presence as compared to the Indian counterparts, most of which are local players vying to expand their markets geographically and otherwise. The industry has emerged from the one in which the customer walks in to the gym to exercise to the one reaching out to its customers by selling them versatile exercise equipments. In the process it has created new markets for itself comprising of institutional buyers like hotels, gymnasiums, corporate, condominiums, social clubs and beauty parlors. Hence we see that the industry is in a phase of rapid growth and evolution and there is a lot of latent and unfulfilled demand for fitness, making the future prospects for the industry bright.
Company analysis
SWOT Analysis of Body Power Ltd
Strengths Superior domestic product Easy availability of good quality raw material Local Brand strength – Established well known reputation with a positive history Existing Customer Base Opportunities Threats Weaknesses Brand Strength only as a Gymnasium and not as a fitness equipment manufacturer
Support from Sports Goods Distributor Cheaper domestic substitutes with National presence Favorable demographic profile and Better perception of international brands
changing lifestyles Less domestic competition Growing Target segment
Competitive Forces
The competitors for Body Power can be classified into two ? ? International Companies Regional Manufacturers
International Companies Brands such as “Body Solid”, “Precord”, “Spark”, “Excer”, “Relax” are the main International companies, which are competing in the same space. The Evaluation from the institutional buyers show that these brands fare better in the performance attributes such as “Ease of Operation”, “After Sales Service”, “Multitasking” and in style attributes such as “Design Aesthetics”. These brands are also perceived better than the Indian Brands by the customers. On the other hand these brands are also priced high, where an opportunity window opens for “Body Power”. Regional Manufacturers There are very few regional players in this market. “Do Well” is one such company. Though the prices are quite low, their products are rated very average in the performance and style attributes.
Customer Analysis
The target customers for Robert’s product are: ? ? ? ? ? ? Hotels Gymnasium run by individuals like him Flats/Condominiums Corporate office and factories Social clubs and, Beauty parlors
Most of the customers for Robert’s product are institutional buyers. These institutional buyer measures the products on various attributes before purchasing it. Some of the attributes are: ? ? ? ? ? Ease of operation After sales services Multitasking Speed of impact on body and, Space occupied
Customers who tried Robert’s product were satisfied in terms of multitasking and the flexibility that the machine provided compared to other products in the same category. Also the product and the proprietor have visibility and have established credibility in the local market of Goa. From exhibit 2 we can make out the top 3 potential states for the product with respect to different institution: ? ? ? ? ? ? Hotels: Karnataka, Maharashtra, Andhra Pradesh Gymnasium: Andhra Pradesh, Karnataka and Maharashtra Corporate: Tamil Nadu, Gujarat and Maharashtra Condominiums: Karnataka, Maharashtra and Tamil Nadu Social Clubs: Goa, Maharashtra and Haryana Beauty Parlors: Maharashtra, Goa, Tamil Nadu and Andhra Pradesh
Marketing Environment
Marketing Environment for Consumer Behavior Analysis
A market research study was conducted with the help of an agency to determine the nature of the demand and size of the potential customer base. In addition, the research helped to determine the qualitative aspects of the consumers’ i.e. behavioral aspects as well as institutional buying behavior. Some of the main findings from this survey are as below: People who did exercise were broadly classified into: ? ? People who did passive exercises People who did active exercises with the help of body strengthening equipment o They considered that the benefits were that it made them feel good, helped to maintain their body, helped in weight reduction and muscle building
Reasons for choosing and identifying the equipment: Some of the factors used by people who did active exercises for evaluating the usefulness of the machine included: ? ? ? Flexibility of the machine Ease of operation Multi tasking
?
Time required for completion and usefulness to specific part of the body
Factors used by institutions for assessing the usefulness of the equipment: The factors which were considered are listed in Exhibit 1 of the case study.
Marketing Plan Part 2: Marketing Strategy
Marketing Program
Target Market & Segmentation Strategy
SEGMENTATION VARIABLES AND BREAKDOWNS FOR BODY POWER MAIN DIMENSIONS Geographic Segmentation Region The demand for the product varies from state to state. We can segment the market along these lines. The states of Goa and Maharashtra, Karnataka and Andhra Pradesh have the high demand. Demographic Segmentation Age Occupation Income The customer base can be segmented as medium income and high income. The concerned age group will be from 18 to 40 years. The consumer base can be segmented as students, professionals, house wives. Psychographic Segmentation Health conscious The market can be segmented according to the health consciousness of customers, as ignorant, aware and concerned. VARIABLES BREAKDOWNS
Based on the case facts and the findings, we believe that Mr. Robert should target the high and middle income professionals (employed in corporate), students of the age 18-25. In addition to this, Mr. Robert should also target the young male body building professionals. For these customers, the most likely places where they would end up going would be gymnasiums, corporate offices. This would be across all the states mentioned above. Along with this, within Goa, Mr. Robert should also target hotels given that there are going to be tourists. To rope in high income consumers in cities, condominiums should be targeted.
Positioning Strategy The factors to be considered while deciding the positioning strategy are: ? ? ? ? Additional features provided by the product. Lower price when compared to imported products. User friendly and convenient. Multi functional and multitasking.
Considering all these, the product should be positioned as a ‘value for money’ product, that is convenient, cost effective and multi functional.
Marketing Mix
Product- The product is standardized, an additional luxury variant will be provided with leather upholstery. Pricing- As decided by Mr. Robert the price will be fixed between 35000 to 40000 Rs. depending on the variants selected by the customers. Distribution Channels- Whole sale distributor will be used for the states of Maharashtra, Karnataka and Andhra Pradesh. For distribution strategies within Goa, the manufacturer can adopt direct distribution.
Promotion Strategy ? Advertisements:1. Health Magazine – Advertising in health magazine will create visibility and awareness about the product. Detailed description of the product can help in educating the potential buyers and end customers about the product. 2. Internet advertisements – Internet ads would also act as an advertising channel. In addition a small video clips highlighting the usage and benefit of the machine can be provided. Such clips can be uploaded on popular search engines like YouTube. 3. Direct Advertisements: Booklets highlighting the benefits, usage and workout schedule can be sent to selected potential customers like lead gymnasium owners. ?
Tie ups with Institutional Buyers: - Gymnasiums form a major segment of the market. It will be a good idea to tie up with the Gymnasiums chains e.g. Talwalkar’s, VLCC etc and with standalone gyms which are famous in local markets. Within Goa he can have tie-ups with 3 star and 5 star hotels.
?
Money back Guarantee: - This is a yet to be established brand and the price tag is not cheap. Hence first timers will be quite sceptical about purchasing it. Hence Mr. Roberts should offer money back guarantee in case the customers are not quite happy with the results. Apart from boosting sales this would also speak volumes about the confidence Mr. Roberts has on this product. This would help in establishing credibility.
?
Tie ups with malls: During weekends Mr.Roberts can have stalls in malls (Goa only) to promote his product. Malls being places where high footfalls are generated he can generate a lot of interest about his product. There the customer would also get a firsthand experience of touch and feel about the product which is very important in case of fitness related equipments. Goa being a tourist destination there will be lot of people from neighboring states also and this would also result in word of mouth publicity.
?
Sponsorship of body building events – Since body building events attract a lot of fitness and gym enthusiasts sponsorship of such events would help in creating awareness and create more excitement about the product.
Review and Control – Mr. Roberts will be preparing simple, decision friendly, weekly, monthly and annual reports which would be focussing on – ? ? ? ? ? Revenue and unit sales Expenses Distributor commissions Customer feedback Competitor activities
Marketing organization – Mr. Roberts will be in charge of the marketing function. He can have an assistant who can help him in taking orders, doing tie- ups, recording sales, etc. As the business expands further in the next 5-10 years he can have sales managers who will take care of specific markets. E.g. the entire 4 states of south India could be classified as one market, whereas Maharashtra being a big market would require a single manager exclusively for its requirements.
doc_957540425.docx