Goodman Fielder and Marketing Strategy-Case Study

Question: Discuss about the Goodman Fielder and Marketing Strategy. Answer: Introduction The assignment has taken Goodman Fielder limited for describing the marketing plan. It deals in food products in New Zealand, Australia. The assignment gives an overview of situational analysis and market analysis of the company (Goodman fielder, 2016). Situation Analysis Internal environment Vision of the Goodman fielder limited is to be one of the most leading and innovative company in local food. The mission statement of the company is to create the food which people love. The main objective of the company is to create a long term value for its stakeholders. The organizational structure of the company consists of chief executive officer; deputy chief executive officer. The organization culture of company gives an equal opportunity to all its employees so to make them realize their career potential (Goodman fielder, 2016). The company has major competition with National Food Ltd, George Weston Food Ltd, and Nestle Australia Ltd. The company has competitive advantage in its distribution network. Goodman Fiedler has an extensive and well established distribution network. The company has core competency in Bakery, Dressing, Dairy, and related products. One of the major core competency laid by the company is that it is very difficult for the competitors to imitate the companys strategy (The Australia business review, 2016). External environment The company impacted by political and legal factors in relation to tax policies. Taxation policies affect company by changes in income tax and Goods Services Tax. Besides this, company has to follow rules and regulations in regard to marketing and agriculture. In case of economic factors, company may face recession in respect to behavior of consumer and market conditions. Goodman fielder also faces social and cultural factors in respect of attitudes of the consumer in relation to health, well being and nutrition. Due to uncertain changes in the consumer buying pattern, it may seem very difficult to gauge the amount to be invested by the consumer on purchases. The company has technical advancement in having advanced equipment which are more innovative and would lead to decrease in cost. The new equipments with the company are able to provide more nutritious and healthier foods. However the company also faces environmental factors in which it got affected by the issues like global war ming and changes in temperature (Goodman fielder, 2016). The company had an issue of providing misleading information in relation to packed food items. The court has declared the company as providing information as misleading and deceptive. However the court had decided that if in case there is any future contract made by the company in a deceptive manner, the company will be found liable to the court (Allens, 2010). Competitive environment The company has a direct competition from Green manufacturers that is because of homogeneous packing and distribution strategy. As in 2011, the market share of the company got negatively affected because of aggressive competition from its competitors in terms of pricing and promotions strategy. However the company deals with its competitors by providing product differentiation. The company provides some value added services and focuses on differentiation strategy which makes it different from that of competitors. For example in case of chocolates the company focuses on providing more quality and increase in nutritional value of chocolates (Australian food News, 2015). The company has major competition in case of product mix with George Weston foods. As it makes some branded breads like golden, tip-top. In New Zealand the company has major competition with Fonterra brands which owns Anchor brand producing dairy products. In case of price mix the Goodman fielder has increased the prices of its dairy products. This has made the company increase in its revenue by 3%. The company has increase in the prices because it could not able to recover the input cost form the wholesale prices it used to charge (Goodman Fielder, 2014). In place mix the company has an advantage in distribution channel. As the company has a network with wesfarmers and Woolworths limited. Hence this has made easy for the company to reach at large market with less impact on pricing (Goodman fielder). In respect of promotion mix the company has a direct competition with green manufacturing enterprise. The green manufacturing enterprise is used to target the customers by offering online. By providing all the relevant information online, the company used to increase in its customer base. Goodman fielders market share got reduced because of aggressive pricing and promotional strategy in 2011. The Goodman fielder has earning per share of $-.21, revenue per share of $1.12 in 2014. In case of Goodman fielder profitability analysis it has negative operating profit margin of $-16.08% and gross profit margin of $35.11%. Besides this the company has total asset per share of $1.13 and book value per share of $0.58 times. While in comparison to George Weston, the company has operating profit margin of 4.22%, gross profit margin of 0.86%. The company has book value per share of 52.42 times (Goodman Fielder, 2014). Swot analysis Strength (S): the Goodman fielder levies at 1st or 2nd position in relation to all of its product categories. Weakness (W): the weakness with the Goodman fielder is that it has few market areas in emerging markets like Asia. The market share of the company is also not so effective. This is because of intense competition between the company and its major competitors (C Convenience and impulse retailing, 2015). Opportunity (O): the company has an opportunity to enter into frozen foods. The company can acquire certain product lines so to make strengthen its strategy (Goodman fielder, 2012). Threats (T): Goodman fielder has a threat in from increment in consumer in awareness regarding health issues. Besides this the company also faces threats from small customized bakeries and patisseries. As increase in consumer awareness regarding the health issues, the company must focus on increasing the nutritional value and healthy ingredients, as the company cannot restrain new entrants to enter in the market. But company can do so indirectly. If the company will focus on customized services and increase in the brand loyalty, as the company is very old to the market hence by producing at large scale, the company can achieve competitive advantage. This would help the company in becoming leader of the food industry and would be able to restrain the new entrants. Besides this Goodman fielder can position its products (bakery, dairy and processed foods) as high quality and healthy content (Stoppres, 2014). Marketing objectives The marketing objective of the company is to focus on its strength and opportunities to overcome its weakness and minimize the impact of threats over it. Besides this the company will focus on increasing the nutritional value in its products so to increase the brand image in the minds of consumers and increase in the percentage of loyal consumers. Marketing tactics The marketing tactic to be adopted by the company to target more consumers can be said as sales promotion. By influencing the potential customers, the sales of the company would be increased. The marketing strategies to be adopted by the company are that the company should divert its focus from price to product, brand equity and marketing of its products (Goodman fielder, 2016). Target market segments profile The company is segmented on the basis of demographic, psychographic, geographic and behavioral segmentation. The company has les market share in emerging regions like Asia. While in case of demographic segmentation, the company focuses on all consumers those are family, children, and youth. Hence it can be said that the company has targeted the mass market. In case of psychographic segmentation, the consumers perceive the company products as quality conscious and high in nutrition value, as the company is segmented into Australia and New Zealand markets majorly. However it can be said that the company is geographically segmented in Australia and New Zealand market. While in case of behavioral segmentation, the company is focusing in targeting the consumers by attaching the product with the behaviors of the consumer. Like in case of chocolates the company focuses on the color, nutritious ingredients. The companys targeted consumers are family, youth and children. The company has market majorly in New Zealand and Australia as it leads to maximum profits and generation of revenue to the company. Besides this, due to lack of domestic competition, company is able to generate better sales. Strategic Direction and Planning Marketing objectives It has been observed by the company financial data that the revenue has been increased by 27.9% in 2016. The profit after tax also got increase by 5.5% due to rise in sales; however the operating profit got increase by 9.3% in 2016. This shows a positive sign for the company. However the company has an objective to increase its sales and profits by increase in quality of the products. The marketing objectives of the company can be said as increase in product quality and increase in advertising. Product quality can be increase by nutritional value, and healthy ingredients. The company has an objective to increase its sales and for such, it needs to do advertising (Paley, 2006). Marketing strategies Porter five forces model Threat from new entrants: the company faces threats from entry of new entrants to the market. Threat from bargaining power of customers: the company should price its product and services as compare to its competitors, as the customer will purchase the product which is high in nutritional value and less in price (Ferell, Hartline, 2013). Threat from bargaining power of suppliers: however the company has good control over its logistics that is outbound and inbound logistics. The company must focus in restraining the suppliers with the company by incentives and allowances. Threat from substitute: the company faces threats from its substitutes due to increase in consumer awareness. Due to increase in preservatives and sweetness, the consumers are substituting the companys products from home made products. Threat from competitive rivalry: as the company has a cut throat competition with its rivalry firms in relation to prices. Hence the company should make strategies to increase the quality of its products by not affecting the price. Ansoff matrix Aggressive strategy The third strategy which can be adopted by Goodman fielder is aggressive marketing strategy. This is done to position the company in the market and to improve the image of the company in the minds of its customers. This can be done by massive advertising, conducting promotional campaign. The company is leader in domestic market; hence it can compete with the international competitors on the basis of providing quality in its products. Marketing Mix The 4Ps of Goodman fielder consists of product, price, place and promotion. Product: the company products consist of a large variety. As in case of biscuits the company deals provides variety in the form of flavors, colors, ingredients such as apricot chocolate, double chocolate, shortbread, peanut brownie and many more (CTI reviews). Price: the company strategy is to focus on increasing quality. But due to production at large scale and expertise in bakery products the company is able to price its products less like price of the biscuits is $3.29. While in comparison to its competitor Farm bake whose price is $4.29. Place: the company products are majorly offered in New Zealand market. Promotion: the company does not spend a large sum of money in promoting its products. Hence the impact is that the company lacks its presence over social media and less advertisement. Process: the process of company is designed in such a way that it leads to achievement of common goal, and it creates a positive environment so to make the employees understand about the systems and process. People: the company runs a program to educate and train its employees. In this program the rotations of employees are being done from their level of interest to other business function area. Physical evidence: the company provides a service of providing bakery products to its customers, which are high in nutritional value and quality. Tactics which company can adopt to achieve these marketing objectives are that, the company must engage in a sales promotion campaign, advertising through social media networking. The second tactic is that company must focus to increase its sales to increase the market share. Third tactic can be said as the company must plan for its pricing strategies so to better able to compete with its competitors. The forth tactic can be said that company must increase its distribution channel so that the consumers must be able to get the product from different channels. The fifth tactic is company should focus on nutritional value and qualitative aspect. The sixth tactic for company is increase in the service of the products that is company should focus on increase in sales after services, and innovation in packaging, process and storing facilities (Nargundkar, 2008). Implementation Control Internal communication plan The communication plan needs to be formed by the leader to provide the information in a clear, accurate manner. In case of Goodman fielder, the manager or leader should form an effective communication plan by conducting annual meetings, written communications, discussion over strategies related to production, quality, customer services and human resource. Activity: Goodman fielder must engage into promotional activities such as advertisement in TV, social media networking, Newspapers, free samples, billboards, and trade fair. This is required to be done by the company to make effective its marketing plan that is increasing its sales. The company can advertise its products on television, or advertising on pay per click on websites such as Google, Facebook, etc. The company would be requiring conducting massive advertising for at least 1 year. Responsibility: it is the responsibility of the company towards its consumers that is company should commit to its statement made in the activities. For such, the company would be requiring to recruit more employees. These employees would be responsible for majorly three responsibilities those are innovation, production, research and development, control activities. Inter department support: for making effective marketing plan, there should be correlation between the various departments of the company. All the departments in the company are related to each other. Timelines: after recruiting employees, the company would be requiring to provide them training. Hence in relation to Goodman fielder it would be requiring a two months training program in which the employees would be trained for the working of the company and the how it works would be described (Rogers, 2001). Indicative budgets: the budget for the company in activity, advertising and providing training and development courses is estimated at 2, 20, 000$ in total. The TV advertising is very costly hence the company would be requiring incurring 40000$. Social media advertising would cost about 20000$. While newspaper, free samples, fair show would cost about remaining money which is 10000$. The free samples to be provided in other markets would cost 20000$. The charges of billboards are 15000$. The company has also made promotional strategies by indulging into trade fair, which will cost 45000$. Indicative Budgets ($) Training development TV advertising Social media advertising Newspaper Free samples Billboards Trade fair 70000 40000 20000 10000 20000 15000 45000 Barrier to implementation: the first barrier to implementation can be said as intense competition, as the company faces a competition from its competitors as well as new entrants. The second barrier of the company can be said as target market. As the company has a less targeted market and it is focusing on New Zealand customers only. The third barrier of the company can be said as budget constraints (Goodman fielder, 2013). Control Goodman Fiedlers key performance indicators are revenue, as the company has able to increase 29%. Another indicator is increase in quality. The third key performance indicator is positive feedback and response from the customer. The fourth key performance indicator is management of finance and administration. Contingency plans of the company can be increase in the quality of the products. Due to increase in the consumer awareness regarding the product, the company faces a threat as it would lead to decrease in sales and loyalty from the brand. Besides this the company faces another contingency plan from its competitors, as the company set its prices either above its competitors or below the competitors price. Hence it is suggested that the company should set its prices at par from its competitors (Mitchell, 2015). Conclusion After analyzing the company marketing plan it can be said that by focusing on the qualitative aspects the target of the company can be achieved. Besides this it has been observed that the company is good at internal environment, but in case of external environment, its performance lacks due to competition and its weakness. Hence it is recommended that the company should focus on its strength and minimizing its weakness. References Allens,(2010). Intellectual property. Retrieved by https://www.allens.com.au/pubs/ip/fofapr10.htm Australian food News, (2015). Goodman fiedlers results reflecting difficult trading consitions Retrieved byhttps://www.ausfoodnews.com.au/2015/02/11/goodman-fielders-results-reflecting-difficult-trading-conditions.html C Convenience and impulse retailing, (2015) Bread prices to fall as Goodman fielder reaches agreement with supermarkets. Retrieved at https://c-store.com.au/2015/02/19/bread-prices-to-fall-as-goodman-fielder-reaches-agreement-with-supermarkets/ CTI reviews, Marketing strategies, contemporary approach, Cram 101 textbook reviews Ferell, O,C Hartline, M. (2013) Marketing Strategy, text and cases, Cengage learning Goodman fielder, (2012) Goodman fielder: shareholder meeting Auckland 28 February 2012. retrieved at https://nzx.com/files/attachments/153922.pdf Goodman fielder, (2013). Investing in the future, Goodman fielder annual review 2013. Retrieved athttps://www.rspo.org/file/acop2014/goodman-fielder-ltd/M-Policies-to-PNC-stakeholderengagement.pdf Goodman Fielder, (2014) Goodman fielder limited- preliminary final report and 2014 annual financial report. Retrieved at https://agrihq.co.nz/assets/198368.pdf Goodman fielder, (2016) The dream big graduate program. Retrieved at https://goodmanfielder.com/careers/grad-cadets-interns/the-dream-big-graduate-programme/ Goodman fielder, (2016). Benefits and rewards, accessed on 7th February, 2017. Retreived by https://goodmanfielder.com/benefits-and-rewards/ Goodman fielder, (2016). Welcome to Goodman Fielder. Accessed on 7th February, 2017, retrieved by https://goodmanfielder.com/ Goodman fielder. Goodman fielders competitors. Retrieved at https://goodmanfielder.weebly.com/competition.html Goodman firlder, (2016). Vision values. Accessed on 7th February, 2017. Retrieved by https://www.countrylife.com.au/index.php?q=node/104 Goodman, (2016) industrial evolution, Goodman annual report. Retrieved at https://www.goodman.com/-/media/Files/Sites/Global/Investor%20Centre/GMG%20Goodman%20Group/reports%20and%20newsletters/Annual%20Reports/20160928_annual_report_2016.pdf?la=en Mitchell, S. (2015).Goodman fielder CEO Chris Delaney departs as Willmar, first pacific take control. Retrieved byhttps://www.smh.com.au/business/goodman-fielder-ceo-chris-delaney-departs-as-wilmar-first-pacific-take-control-20150317-1m13mk.html Nargundkar, (2008) Marketing research 3E, Tata McGraw Hill Education, New Delhi Paley, N. (2006) the managers guide to competitive marketing strategies, Thorogood publishing, London Rogers,S,C. (2001) Marketing strategies, tactics. And techniques: a handbook for practitioners, Greenwood publishing group Stoppres, (2014). Goodman fielder wins august ad impact award, appoints ractive as digital agency. Retrieved at https://stoppress.co.nz/news/goodman-fielder-wins-august-ad-impact-award-appoints-reactive-digital-agency The Australia business review. (2016) https://www.theaustralian.com.au/business/business-spectator/mission-statement-impossible/news-story/5e67be80bf5c253c6a5ba0fecdc535f9