3.0 Introduction - Strategic Marketing Plan Assignment Sample
3.1 Current situation and a summary of the key challenges it needs to overcome
Dove is a personal care brand which is owned by Unilever, developed in their New Jersey based research centre in the U.S. Introducing the concept of beauty bar for the first time in 1950s, creating a niche for itself in the personal care brand. The brand though synonymous with body positivity campaigns, has been in the news for a campaign allegedly depicting racism, with a black woman changing into a white woman (Sheroog, 2016).
While this is the first major criticism faced by Dove over the years, a vital issue faced by the brand is market saturation globally. The brand needs to explore markets where there is probability and scope of growth. Additionally, the brand faces a major challenge of not being able to turn its strong media presence into sustained profitability (Ahmed, 2015).
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3.2 Vision and mission statements, core values, and strategic objectives
Dove as a brand has been associated with body positivity and Inner Beauty through its Real Beauty, Evolution and Self Esteem concept campaigns creating a niche for itself in the personal care segment with widespread support from the consumers.
Dove has been a pioneer and front runner in analysing changing lifestyle patterns and utilizing the evolving beauty perceptions to create a stand-alone brand image associated with the movement, to create an everlasting identity (dove, 2020\).
3.3 Purpose statements
The brand strategy focuses on innovative campaigns enhancing the concept of Real Beauty introduced in 2004, evolving in the current times in relation to the current ideals of relatability and authenticity. Focussing on the concept of women gaining empowerment by believing in themselves and increased participation and representation of all women, the brand has developed ideas such as “Project #ShowUs” and “Women Get Told” among others to initiate and support revised definition of beauty and confidence. The idea is to create a loyal fan base among the women of today who have different priorities, aims and ideas.
4.0 Environmental analysis
4.1 MACRO trend environment analysis
PESTLE Analysis:
Political Analysis: Saudi Arabia is an absolute monarchy with the conservative policies. However, due to the changing times and widespread global pressure, the monarchy is trying to modernize and bring about reforms, adopting policies increasing women’s rights enabling increased participation in the national workforce.
Economic Analysis: Saudi Arabia is the richest Arab country and the largest economy in the Middle East largely dependent on oil & petroleum sector.
Due to implementation of progressive development plans over the years, the country became a member of the World Trade Organization (WTO) in 2005, and has thereafter maintained development of trade related policies and legislations. Additionally, the Vision 2030 plan encourages foreign investment for greater diversification of the economy (Abdulbari, 2013).
Social Analysis: The presence of large oil reserves and stability of government and finance sectors have led to a high-income population with increased disposable income.
The population of the country is fast increasing and constitutes nationals as well as expats (almost 30%). The population is predominantly young with over 51% below the age of 25.
Technological Analysis: The current regime under King Salman, has undertaken massive measures to bring about technological advancement in the country by adoption of government supported programs for expanding infrastructure in areas like information technology and telecommunications (Strickland, 2018).
Legal Analysis: The country labour laws provide a safe and progressive work environment for the workforce. As per the Labour Law, 75% of the total employees must be nationals, however, the Nitaqat program allows for employment by quota, as per the total number of employees and the sector of the company.
Environmental Analysis: Heavily dependent on its oil reserves, the country lacks strong environmental policies. The excessive usage of fossil fuels, increasing population and industrialization pose grave threat to the environment, causing extensive air and water pollution. Also, due to it being a desert region, Saudi Arabia faces scarcity of water with approx. 40% of its water supply from non-renewable groundwater (Herri, 2018).
4.2 MICRO trend environment analysis
Porters Five Forces Analysis:
Threats of new entrants: The threat of new entrants in the personal care sector is low due to the high investments and requirement of expertise involved in the research and development processes involved in the creation of a successful brand.
Threats of substitutes: The threat of substitutes is high in the sector with consumers naturally favouring lower priced products having similar characteristics. Hence, to counter the threat the brand will have to constantly innovate in its branding and marketing strategies.
Threats due to rivalry: The threats due to rivalry is medium as although there is a higher concentration of products available to the consumer, the market is more or less firmly divided with a loyal fan base.
Bargaining power of Suppliers: The bargaining power of suppliers is low due to the existence of a great variety in the market, with diverse characteristics offered by large as well as small scale manufacturers, for all price ranges.
Bargaining power of Buyers: The bargaining power of buyers is high due to the variety of options available, leading to intense competition and the brands resorting to offering discount offers and other gimmicks to attract the customer (Peter and Donnelly 2007).
Customer Segmentation Analysis:
User by Age
The majority of the population is young, however the income generating population is above the age of 20, with people having a higher percentage of disposable incomes in the age bracket above 25. Hence, people with their age above 25 constitute the higher percentage of the product’s users (Daf, 2008)
User by Gender
The country’s population, increasing at a constant rate, is comprised of 33% foreign nationals, while the local population, the men and women are almost equivalent. However, among the expat population the females constitute 30% belonging to the higher income group.
Although the working population has a much higher percentage of males, the consumer base for the personal care sector has a slightly higher percentage of females due to the brand focus on women and the nature of the sector being more appealing towards the females (McDonald and Wilson 2011)
User by Income
The lower income group interestingly have a higher consumer base in the market for mass produced personal care products. This information can be utilized in the pricing of the product and budgeting of the marketing strategies (Lovelock and Chatterjee 2010).
Summary of macro and micro analysis
Through the above macro analysis utilizing PESTLE technique we can infer that Saudi Arabia is looking to develop its economic infrastructure towards non-oil based sectors.
The increased efforts to modernize the country, increase employment opportunities and gradual increase in women empowerment is projected to provide more growth opportunities for the increase of the sector.
Although, the threats of new entrants are low in the personal sector globally, there is a threat of increased rivalry in the Saudi Arabian market, due to supportive government policies.
Subsequently, the bargaining power of buyers is higher and Dove will need to develop counter strategies focussing on a creating a niche market.
Through the customer segmentation analysis, we can conclude that although women still constitute a higher percentage of the consumer base for personal care products, the men comprise a large chunk of the consumers. Although the numbers are set to vary with gradually increasing women rights, the brand can benefit from launching male centric products, increasing growth opportunities of the brand.
Also seeing that the consumer base is slightly towards the low income, the brand can increase its advertising quotient to appeal to the higher income base who may be investing in boutique or organic products.
4.3 Internal Environment Capability Analysis
McKinsey’s 7S Framework
Strategy: The brand strategy has always centred on women and the changing definitions of beauty, promoting diversification, inclusivity and body positivity.
Structure: The Dove brand is owned by Unilever, a multinational consumer goods company. Unilever has a matrix structure with multiple levels of authority based on the product, region and function to increase the focus on globalization of brands. Dove in Saudi Arabia falls under the personal care division controlled by the Middle East region head.
Systems: The organization has adopted a system focussing on designing innovative campaigns to differentiate its market share for brand development. The brand has conducted surveys to identify issues it can associate with to leverage a bigger consumer base (Aaker, 2004).
Style: The brand has always looked at being inclusive of age groups, races, ethnicities, body size and shape and other demographic divides among women. In an attempt to drive home their intention beyond advertisements, the brand has also launched body wash bottles depicting different shapes to show diversification (Hatch and Schultz 2003).
Staff: In keeping with the brand ideologies of inclusivity, the HR management practices under Unilever aim at ensuring a supportive and positive work environment with the help of training and development programs, enabling growth and increased productivity among its employees.
Skills: The Dove brand needs to focus on greater innovation and research and development initiatives to remain in competition in the market. Currently the brand invests much less in R&D compared to its competitors, which may cause losing out on its consumer base eventually.
Shared Value: The core values of the company in relation to the above factors indicate brand leaning towards customer obsession, leading to development of strategies reflecting honesty and an intention to create high impact to segregate itself from its rivals. The brand focuses on creating a direct communication with the consumer developing on the concept of relatability (Edström & Galbraith, 2017).
Barney’s VRIN Framework
Value: The value of the Dove body wash product is in the way the brand leverages its position in the market is the brand affinity for recognizing issues with the potential of developing into global movements and thereafter initiating or providing momentum to the movement through its strong media activities and campaigns. The brand intends to create customer obsession by associating with societal movements. Additionally in line with the practice of halal, the Dove has become cruelty free, endearing itself to not only the Muslim consumer but also the consumer against animal killings.
Rareness: The products offered by the brand differs itself from other similar category products by emphasizing and frequently demonstrating the moisturizing and creamy quality of the product, leading to lesser skin irritability and dryness. These characteristics are valued especially in the dry and arid landscape of the Middle East. However, other brands have focussed in the innovation and launch of products providing similar benefits leading to increased rivalry.
Imitability: The product characteristics remain unique and have an advantage over its usage effects in that it leaves the skin feeling soft, moisturized and smooth. Despite their originality, the brand faces stiff rivalry from similar priced brands, though not having similar characteristics, provide similar effects, forming the basis of the consumer demand, differentiated only by prices and marketing. The brand maintains its uniqueness in the marketing department, its ability in identifying and spearheading underlying movements to prominence, remaining unbeatable.
Non-substitutable: The brand is lacking in the ownership on innovation in its products, which is why it is easily substitutable, being a drugstore personal care brand. It needs to counter the lack of innovation in its product range to enable growth (Mentzer, Myers and Stank 2006)
5.0 Proposed strategy
5.1 SWOT analysis
Based on the analysis of Saudi Arabia and its market for personal care brands in conclusion below is a SWOT analysis of the brand w.r.t. the Kingdom.
Strengths:
Dove’s core strength relies on the originality if its product.
A major driving force for the popularity of the brand is the innovative and relevant ad campaigns undertaken by the brand promoting diversity and inclusion instead of relying on promotions through celebrities.
The brand ensures its presence in all leading retail chains and outlets, with a significant drop in its products in rural areas.
Weaknesses:
The weakness of the brand lies in not being able to leverage its strong PR into sustained profitability.
Additionally, the extensively awarded campaigns took a hit in the recent times when a well-intended campaign went awry when the original 30 second video was cut to 3seconds showing a black woman converting into a white woman raising allegations of racism.
Another issue is not being able to properly target the male oriented personal care sector losing out on a lucrative section.
A major drawback faced by the brand is the initial decentralized organization of the main owner Unilever leading to development of several products in the similar sector range, creating internal conflict among home grown brands, discouraging the globalisation of a single unified brand.
Opportunities:
The Saudi Arabia Personal care market is poised for growth.
Moreover, the reformative policies of the Kingdom under the Saudi Arabia Vision 2030, provide a more favourable market for growth of the brand
The gradual increase in women empowerment in the country is synonymous with the brand strategy and can be utilised to create a niche market for itself.
Threats:
With the saturation of market with personal care products range providing vast options to the consumers, rivalry among the brands to capture market has increased greatly.
Being a drugstore brand, in trying to maintain its exclusivity towards premium market, the brand is losing out to lower priced similar products(Abdulbari, 2013).
5.2 Key marketing opportunities
The brand needs to invest in a productive way in the R&D to provide innovation in its product features to increase the rarity quotient and decreasing imitability of the brand, in keeping with its rivals in the sector.
Additionally, the brand also needs to develop a wider range of products to cater to the growing user demands and expectations, with a more affordable price options to increase its target economic consumer base. This will help the brand in sustaining its hold over the market and not being easily substitutable.
Capitalising further on the brand association with women empowerment, Dove Body wash range can support the gradual increase of women rights in the Kingdom, consolidating its presence with local representation.
Based on the consumer segmentation, the brand will also benefit with increased representation of its products for male section of the market, with the gender forming almost half of the consumer base of the sector (Luther 2011).
5.3 SMART marketing objective
Specific: The brand needs to increase its sales by 50% in the Saudi Arabian market coming 5-year period to be able to achieve growth in the personal care segment in the Kingdome.
Measurable: The organization should look at adjusting the product price range to increase revenues.
Achievable: With the brands marketing strategy focussing on real people and their issues, the huge marketing costs utilized by the brand can be reduced through usage of social media and its “influencers” providing cheaper PR, maintaining as well as enhancing direct consumer communication.
Realistic: The increasing usage and network of internet and Smart phones has enhanced the reach of brands, making it realistically possible for a brand to conduct one on one feedback with its customers worldwide easily.
Time-bound: The 5-year period provides sufficient time for the strategy to show desired results and increased revenues.
5.4 Planning models and frameworks to develop the outline strategy
Utilizing the 4 P model of the marketing mix the strategy for the objective can be streamlined as follows:
Product: The Dove body wash is a universally used product, catering to requirements of both the genders, with additional quality of providing moisturization along with cleansing.
Price: Traditionally, the Dove brand has marketed its products, including body wash as a higher range commodity. In correlation with the strategy as explained above, the pricing can be reduced to match its competitors. With the product quality, the brand is sure to create a larger consumer base with better returns.
Promotion: The brand can leverage the advancement of internet and social media in Saudi Arabia due to infrastructure development towards brand promotion by increased collaboration with local influencers, increasing brand credibility while saving expenditure on the production of physical shoots.
Place: The brand should increase its product placement in all major retail chains, while also focusing on the growing e-commerce market. It should also diversify from its focus on the main cities.
5.5 Triangulation
The proposed strategy helps the brand in capturing the fast-growing personal care segment by reaching out to the lower economic sections, which as per customer segmentation comprise the maximum consumer base for the drugstore cosmetic brand.
As referred previously, the saturation of the segment has led to stagnancy in the product revenues. Despite widespread and heavily awarded promotional campaigns, promoting brand association with women empowerment, the brand has failed to translate the consumer obsession into profitability. The major attribute leading to the decreased growth is the brand pricing and limited positioning of the brand.
The above strategy, while maintaining focus on the core brand value of taking a social stand for important issues concerning the growth and development of females, also enables the brand to expand its network of consumer reach.
The modernization, availability of employment and improved standards of living of the general population on Saudi Arabia and the gradual increase in women’s rights will help the brand in successfully consolidating its position in the market.
5.6 Implementation plan
To assist the implementation of the above strategy, the brand should begin with evaluating the price range within which it can reduce the current product pricing and the marketing budget effectively to earn sustained revenues without reporting losses.
Subsequently it should also explore the social media influencers and the extent of their presence and power to influence the consumer base. The brand can take care to maintain diversity in their choice of selected collaborators to maximise its reach, utilizing the current campaign of Self Esteem.
The brand can also look at involving men in its coterie of collaborators to appeal to the male consumer base as well.
To increase its product placement, the brand can also launch online or physical activities with the collaborators.
5.7 Analysis of the marketing controls that will be employed to monitor & evaluate the relative success of the strategic marketing plan
While implementing the above strategy of reduced prices, care should be taken to not reduce the brand value and therefore product credibility. The brand can provide discounts on existing products, while introducing newer products in a lower price range to prevent confusion and loss of brand value.
Additionally, the performance of the new strategy should be closely monitored for the first two years to check for deviation or new trends disproving the method, by evaluating the returns in terms of the new and reduced pricing range.
Moreover, the value addition to the brand in terms of increased consumer base should also be monitored vis-à-vis the social media collaborators, ensuring to tap the maximum benefits from the resources of the influencers.
5.8 Key Performance Indicators
The adoption of the strategy aims at providing a growth of sales of Dove body wash by approx. 50% in Saudi Arabia within a time period of 5 years.
The key performance indicator can be evaluated in terms of the sale returns as calculated in the annual report, checking against the growth in terms of the investment in strategies.
The key measures include, Revenue per Client (RPC), Client Retention Rate (CRR), Profit Margin among others. Maintenance of positive and increasing figures indicate growth and success of the strategy.
References
Aaker, D. (2004). Leveraging the Corporate Brand. California Management Review, 46(3), 6-18.
