Marketing Plan for the AMT Coffee
BTEC Level 4 HN Diploma in Business (QCF)
Unit aim: The aim of this unit is to provide learners with the understanding and skills to develop marketing plans that meet marketing objectives, and meet the needs of the target make plans that meet marketing objectives, and meet the needs of the target market
Unit 19 : Marketing Planning
Unit code: H/601/1259 QCF level: 5
Credit value: 15 credits
The aim of this unit is to provide learners with the understanding and skills to develop marketing plans that meet marketing objectives, and meet the needs of the target make plans that meet marketing objectives, and meet the needs of the target market.
Effective planning is essential for any marketing activity to ensure that an organisation realises its marketing objectives. Without planning, marketing activity can be inappropriate and waste resources and opportunities.
This unit introduces learners to different ways of auditing, to looking at how internal and external factors can influence marketing planning for an organisation, in order to build up a picture of the marketplace. Learners will gain an understanding of the main barriers to marketing planning, the effects of barriers, and how these can be avoided or overcome. Ethical issues in marketing are important in terms of how an organisation and its products are perceived by customers and employees, and can affect the overall ethos and ultimate success of the organisation. This unit will enable learners to investigate and examine how exemplar organisations have been affected by ethical issues, how they deal with them, and how ethical issues should be taken into account when develop marketing plans. On completion of this unit learners will be able to produce a marketing plan for a product, a service or an organisation that is realistic, in terms of objectives and resources, and effective in terms of the current situation in the marketplace.
On successful completion of this unit a learner will:
- Be able to compile marketing audits
- Understand the main barriers to marketing planning
- Be able to formulate a marketing plan for a product or service 4 Understand ethical issues in marketing
- Essential Requirements
Learners must have access to the internet in order to carry out research. They will also require access to a range of case studies and exemplar material which illustrate the theories and practice covered in the learning outcomes. Tutors must build a bank of resource materials to ensure there is a sufficient supply of relevant information across a range of business types and sectors.
BTEC Levels 4 and 5 Higher Nationals specification in Business – Units – Issue 7 – May 2014 © Pearson Education Limited 2014
UNIT 19: MARKETING PLANNING This unit links to other marketing units within the pathway – Unit 17: Marketing Intelligence, Unit 18: Advertising and Promotion in Business and Unit 20: Sales Planning and Operations.
The unit is also linked with Unit 4: Marketing Principles and Unit 6: Business Decision Making.
Discussion Exercises Q&A
Feedback Observation Reflection
|Revise areas done week before and debrief homework question|
Home work- Reading and researching on the organisations students have chosen for assignment
Understand how to formulate a research specification
Homework- To carry out a SWOT and PEST analysis on chosen Organisation for assignment
Homework- Apply learning the assignment at home
To carry out a SWOT and PEST analysis on their own organisations and apply to task
Class work - Apply learning to assignment/ prepare for presentation
|Session 12||One to ones on Task 3|
|Learner Name||Assessor Name||ISSUE DATE|
|Programme Title||Unit No & Title||Unit Code|
Edexcel BTEC Level 5
|Unit 19: Marketing Planning||Unit 1 Y/601/1259|
|Learning Outcome 1||Be able to compile marketing Audits|
|Review changing perspectives in marketing planning|
|Evaluate an organisation’s capability for planning its future marketing activity|
|1.3||Examine techniques for organizational auditing and for|
analysing external factors that affect marketing
|1.4||Carry out organizational auditing and analysis of external factors that affect marketing planning in a given situation|
|Learning Outcome 2||Understand the main barriers to Marketing Planning|
Assess the main barriers to Marketing Planning
|Examine how organizations may over come barriers to Marketing Planning|
|Learning Outcome 3||Be able to formulate a Marketing Plan for a Product or service.|
|3.1||Write a marketing plan for a product or a service|
|3.2||Explain why marketing planning is essential in the strategic planning process for an organisation|
|3.3||Examine techniques for new product development|
|3.4||Justify recommendations for pricing policy, distribution|
|3.5||Explain how factors affecting the effective implementation of the marketing plan have been taken in to Account|
|Learning Outcome 4||Understand ethical issues in marketing|
|4.1||Explain how ethical issues influence marketing planning|
|4.2||. Analyse examples of how organizations respond to ethical issues|
|4.3||Analyse examples of consumer ethics and the effect it has on marketing planning.|
The assignment involves a written Presentation, a Report and hand-outs.
The current market is very much dynamic and to achieve success in this dynamic market and to attract the mind of the customers, it is very much important for any organisation to have an effective marketing plan. A marketing plan can be defined as the set of activities that are important to design marketing activities according to the marketing plan. Marketing planning mainly involves different types of issues related to the marketing communication strategy, distribution channel and the product line.This assignment is intended to describe the marketing plan for the AMT coffee, which is one of the organisations that have a chain of the coffeehouses that are mainly situated in the railway stations. This organisation was the first coffee company which utilises the 100% organic milk and the 100% fair-trade coffee.
1.1 Changing perspectives in the marketing planning:
As stated by Johnsonet al. (2016), marketing tool is one of the marketing tools that can help any organisation to understand everything related to an organisation. Here the ATM coffee is operating in the railway station, airport and hospital of the UK, and railway of the Ireland, Belgium and Germany but they want to expand their business with a new product (Bakeryinfo.co.uk, 2016). Therefore, they want to implement an effective marketing plan so they can achieve competitive advantage because there are several established market player that are doing their business in that area. Therefore, to grab the attention of the customers they should develop a new coffee item with unique tastes. Therefore, when they will marketed their product they should mention the unique tastes of their new product.
Itis seen that their current business does not include technological advancements. However, time has changed and now customer became the heart of the business. Organisations are not only a profit making organisation in the current time, but they also consider the needs of the customers and generate effective plan by which they can satisfy their customers with effectiveness (Ha, 2016). Technology has also changed, therefore, AMT coffee must create an app or websites so they can sell their food related items and coffee in online mode. Competition has changed, in the current days; the sustainability can be maintained by facilitating change in the organisation. For this reason and to maintain the sustainability AMT coffee wants to expand their business with new product development. UK is facing inflation due to they left the EU, which causes low-level disposal income among the customers. Therefore, customers now want a product in fewer prices so if they can provide their unique products to the customers by following a low pricing strategythen they can achievecompetitive advantage.
1.2 Organisation’s capability to plan the future marketing activities:
The capability of any organisation can be defined as the capacity of any organisation to utilise their strength for eliminating their weaknesses so they can grab different opportunities and maintain the sustainability. In this case, the capability of any organisation to plan the future marketing strategy can be evaluated by the SWOT analysis.
- AMT coffee already have an effective and existing customer database because they have several branches of the UK
- AMT was the first coffee company in the UK who are using the 100% organic milk and fair-trade coffee in their coffee product so they can easily grab the attention of the customers by inventing new type of coffee item ((Bakeryinfo.co.uk, 2016).
- They are liable to provide best quality coffee to the customers that increases their profitability and increases their chances to achieve competitive advantage in different high street of the UK
- They do not have effective marketing strategy which jakes the customers unaware regarding their organisation
- They have negligible online presence that also keep customers unaware reading their services
- They are currently suffering from the deduction of the profit amount and it is seen that their current turnover becomes £22.8 million from the £23 million (Bakeryinfo.co.uk, 2016).
- As they are mid-size organisation so it is very much difficult for them to buy place in different high street of the UK
- They have several branches in the railway station of Belgium and Ireland but it is seen that some of the railway station is getting closed that creates a negative impact on their business
- They can expand their business in different part of the UK along with railway and airports
- They can increase their online presence and sales their product from the online media
- They may face huge level of competition from different established market player in the high street of the UK
1.3 Techniques for organisational auditing and analyse the external markets that can affect the marketing:
In order to facilitate the organisational auditing Mackinsey’s 7’S model is most effective. Mackinsey 7 S model is effective to analyse the marketing capabilities of theorganisation form different point of view.
|Strategy||Their main strategy is to satisfy customers with good quality coffee in low price|
|Structure||Currently AMT coffee are following a flat organisational structure|
|Systems||All of the cook are well capable to maintain their operation so they can make good quality coffee and serve it to the customers|
|Shared values||The main shared values of the AMT coffee is their unique coffee and food making skills (Researchandmarkets.com, 2016).|
|Style||AMT coffee is mainly follow the participativeleadership style so they can motivate their employees to satisfy huge number of customers|
|Staff||Currently, AMT coffee has sufficient number of employees to maintain the sustainability of their organisation.|
|skills||In AMT coffee all of the staff are enriched with the coffee making skills and along with that they have also knowledge to cook some fast food that are unique in tastes|
The external factors can be analysed by the PEST factors, which is one of the tool that helps to analyse the external environments. PEST analysis of AMT coffee is:
AMT coffee is widely affected by the current instability of the government. After leaving the EU, UK implemented new set of corporate tax that creates huge problem in the operation of the AMT coffee (Researchandmarkets.com, 2016). Due to increasing level of tax an inflation situation is created in the UK. Currently, UK has more middle class family and all are hugely affected by the coffee culture so AMT coffee can take this as opportunity and develop their new products to attract them. Moreover, technology also creates a huge impact on the business operation so it is important for AMT coffee to develop their business with technological advancements.
1.4 Carry out the organisational auditing and external factors that affect the marketing planning:
In order to maintain their operation in the UK, AMT coffee is facing problems from the different legislation and law of the UK. Their businesses are affected by the current tax policies and employment related legislations (Van Valenet al. 2016). Regional integration of the markets and increasing level of government support to mid-size organisation can provide an effective support to develop their business.
AMT coffee is one of the medium sized organisations so they are facing problems due to increasing cost of the labour because they have limited operating revenue. On the other hand changes in the taxation level of the UK creates a crucial problem on the operation of the AMT coffee. Recently, UK left the EU that makes UK to pay the EU with 1.7 billion euro that creates inflation in the UK and creates low disposal income for the customers because of the several terminations from the job. Therefore, in order to attract customers with low economic condition they need to follow low pricing strategy to provide quality product (Vargas-Hernández and Jimenez, 2016).
In the UK the growing numbers of people are attracted to the coffee culture that can be one of the opportunities for the organisation. Along with that, coffee can provide a good health so this high level of health consciousness can help their business to grow. Middle class customers are growing in the UK that can help their business to grow.
The development of the technology makes the coffee making machine cheaper and better so AMT coffee can utilise their opportunity (Jain and Haley, 2011). Along with that they can develop a mobile app and a website to sell their food and coffee related items to the customers to achieve sustainability because online shopping is the current trend.
2.1 Main barriers of marketing planning:
For implementing change in the organisation, it is important for AMT coffee to have an effective level of cooperation among the different management level. Along with that, lack of motivation among different management level regarding change implementation can create a huge barrier for the success of the marketing planning.
In order to implement any kind of change in AMT coffee, it is important to have effective skills and knowledge level among the employee (Lysonski and Pecotich, 2012). Absence of that may create huge problem. Along with that, biases regarding expectation from the customers of AMT coffee can generate huge problem in the way to achieve result.
Any marketing plan can be successful if they follow a unique strategy, if it became same with the competitor’s strategy then it may create a complete failure (Piercy and Morgan, 2011). Along with that change may create conflict among employees that also causes complete failure of the plan.
In order to reduce barriers, it is important for the AMT coffee tohire a consultant and take effective consultation from them so the importance of the marketing can be understood by them. Along with that setting of objective and escalate it among management of AMT coffee can increase effective level of cooperation.
In order to provide effective level of skills regarding the new coffee product of the AMT coffee, they must provide training to their employee. It is also important forthem to conduct a market audit to understand the upcoming popularity of their new coffee items.
It is important for the AMT coffee to follow democratic leadership style so they can avoid conflict among employee by facilitating more effective communication. In order to understand the uniqueness of the plan, it is important for the AMT coffee to conduct a market analysis.
3.1 Marketing plan for AMT coffee:
Marketing plan generally consists of four steps, they are as follows:
For introducing any new products in the market, it is important to have a proper goal. In this case, the main goal of the AMT coffee is to achieve huge customer base by developing an effective coffee item with unique tastes so they can achieve huge profit from both their existing and new customer base.
As stated by Neiger et al. (2013), situational analysis can be defined as the process that can examine both the strength and weaknesses of the organisation alongwith different other factor that can affect the operation of the organisation. Situational analysis has two elements such as micro environmental factors and macro environmental factors. It is seen that the AMT coffee have effectiveness to make coffee by including 100% good quality products. Along with that they have an existing customer base that they can use to attract customers for their new products. Therefore, they have the capability to make a new coffee item for their organisation. However, they have certain weaknesses such as they have negligible online presence and they are currently suffering from less amount of turnover than the previous years. They have several opportunities like they can expand their business indifferent high street and they can increase their onlinepresence. However, there are huge chances that they can face challenges from different established organisation.
By analysing the macro environmental factors, it is seen that the AMT coffee may be affected by different external factors. In the recent times,UK left the EU that createsinflation in the market because of the termination of job. This creates a less amount of disposal income among the customers so this negatively affects the business of the AMT coffee. However, growing level of coffee culture and middle class family can provide effective opportunity to the AMT coffee. Moreover, different technological factors such as e-commerce and development of the mobile telephony increase the opportunity for the AMT coffee so they can develop their business and achieve competitive advantage through online products sales (Golding and Peattie, 2012). It is seen that there are several existing market player such as Starbucks, Costa Coffee Electra so it is difficult for any new organisation to establish their market in the highly segmented industry. Along with that, customers have high level of bargaining power so AMT coffee may face problem to attract them. Therefore, they need to develop a low pricing strategy. However, in this industry the bargaining power of the suppliersis less because of the presence of high level of suppliers in the market. In this market there are also huge substitutes such as tea, different soft and hard drinks so it can possess as threat for the AMT coffee. Along with that, competitive rivalry for the AMT coffee is high.
According to Jamal (2015), the main target customers of them are their existing customers as well as new middle class customers. Therefore, it isimportant for the AMT coffee to follow the focus targeting strategy. In order to attract the price sensitive customers in the market, they most utilise the price positioning strategy to offer them low priced products. They can follow the product development strategy by which they can offer new kind of coffee item to their existing customer’s base. In order to attract their existing customers with new type of product, AMT coffee should invest huge amount of resources. Along with that, they should utilise an effective promotional channel so they can attract their customers.
Designing marketing tactics:
By formulating the strategic plan, it is very important for AMT coffee to take different decisions regarding their marketing mix of their new products. In case of the AMT coffee, it is very important for them to take their marketing decision by considering the pricing decision, development decision and promotional decision of the company (Piercy, 2011). The marketing mix of the AMT coffee is as follows:
The product range of the AMT coffee is some coffee related items and food related item. However they want to expand their product range with new type of coffee related products.
In order to decide the pricing strategy for their product, AMT coffee must follow a low pricing strategy so they can attract huge number of customers.
They should sell their products through their existing shop in the railways, and airports.
In order to promote their product they must utilise the social media marketing strategy. Along with that, they can utilise the sales promotion strategy.
Monitoring and control:
After developing the marketing strategy effectively, it is important for them to monitor the overall process of the so it can be effectively controlled.
3.2 Explanation of why marketing planning is important in the strategic planning process:
According to Gronroos (2014), marketing plan should be made in that way so that it can provide different types of information that can help the stakeholders for measuring the progress of the marketing process and show the most effective marketing strategy. A good marketing plan must have the capability to boost the sales of any products or services as well as increases the profit. On the other hand, the strategic planning process is that process that helps any organisation to define their direction, strategy and helps them to make decisions to allocate their resources.Marketing plan can help AMT coffeeto focus on their target market, determine the demandfor their product and helps them to identify the target market so they can secure an effective amount of profit by having an effective strategic planning process.
3.3 Techniques for new product development:
According to Hulbertet al. (2011), new product development is the processes include the designing of the product, testing and considering the capability of the product to attract the customers. AMT coffee must develop their in that way so it can make their organisation distinguishable from the other organisation. The product development stages of the AMT coffee is as follows:
Generation of the idea:
Before developing the new product, it is important for the AMT coffee to understand their weaknesses so they can understand what kind of problem that they can face while launching their products to the market. Here AMT coffee wants to develop a new and unique taste coffee item that should be made by some unique ingredients.
Screening of the idea:
This step involves the elimination of the unrealistic idea and retains the realistic idea (Van Waterschoot and Van den Bulte, 2011). They first think that they will introduce their products in different high street but after sometimes they have eliminated the idea because there are huge risks to introduce the product in the market by following the diversification strategy.
Development and the testing of the product:
After the development of the idea, it is important to test the feasibility of the idea so it can be seen that the idea can be transformed into the product or not. In order to understand and test the feasibility of the idea, it is important to conduct a survey on the target customers so the accessibility of the product can be accessed (Davids and Newcomb, 2015). This survey can be conducted in both the offline and online idea.
Developing the most effective marketing strategy for the product:
In this step, it is important for the AMT coffee to develop the most effective marketing strategy and then they should convert their idea to the products. In order to promote their products, AMT coffee must select some sales promotion strategy and online marketing strategy. They should utilise the social media marketing strategy because it is the latest trend in the market.
In this step, it is important place the coffee item on sales. After doing that, it is important to see the appropriate performance of the product.
Commercialisation of the product:
After developing the product and implementing an effective marketing plan they must start their production to sell that coffee item.
3.4 Justify recommendation for pricing policy, distribution and communication mix:
After developing the coffee items, it is important for the AMT coffee to set an effective pricing policy according to the target customer’s disposal income. Here the initial cost of the product is not so high so they can charge a low pricing for their new products. As stated by Borden (2011), the pricing strategy must be unique according to the tastes of the product and the making charge of the product. As there are various same type of organisation who have also different types of coffee related products and existing customer base, so AMT coffee can utilise the penetration pricing strategy. According to this pricing strategy, company are liable to keep their prices lower thantheir competitors. There are several advantages of this pricing strategy that are it decreases the production cost, increases the customer base and increases the volume of sales over a particular period of time. On the other hand, its disadvantages include profit related problems, problem related to the limited time frame and challenges regarding the branding.
In order to distribute the products, AMT coffee must consider the size of the organisation, different policy formed by their competitors, and the characteristics of their products. AMT coffee can utilise different distribution channel such as selling products in the railway station and high street, and online selling by launching their own website and apps.
After selecting the pricing strategy and their distribution channel it is also important to aware customers regarding the product, for this reason an effective communication mix strategies are important. AMT coffee can utilise the following communication mixes:
For increasing the sales and making people aware regarding the new products, it is important to provide some facilities to the customers so they can use it and understand its uniqueness, in this case, AMT coffee can provide first cup coffee for free or they can provide huge discounts for their old as well as new customers so they can understand its uniqueness.
Along with that, AMT coffee must utilise the social media to aware customer’s regarding their products. In order to facilitate this they can aware their customers in Facebook, Twitter or they can upload a video of their services in the YouTube so they easily attract the attention of people because most of the customers are utilising the social media.
3.5 Explanation of how factors can affect the effective implementation of the marketing plan:
According to Zimmereret al. (2011), to minimise the tasks and maximise the profit it is very much important to make a suitable marketing plan but there are several factors that can affect the implementation of the marketing plan effectively. Those factors are as follows:
Limitation regarding the budget:
It is possible to implement the marketing plan only then if organisation has sufficient financial resource to make the planning true. In it is seen that the current turnover of the AMT coffee is the £22.8 million so it can be easily assumable that they are well capable to develop a new coffee related items. Moreover, this product development requires almost no budget but the promotional strategy requires some budget.
Lack of support from the management:
If the upper levelmanagementof the AMT coffee do not feel the importance to provide support to their human resource regarding the development of this product then it would be difficult for them to launch this product successfully (Kama et al. 2013).
If the marketing plan became illegal then it may create a challenge due to the legal action on the organisation.
4.1 Explanation of how ethical issues influence the marketing planning:
As stated by Lysonski and Pecotich (2012), practising a good ethics in the organisation can help any organisation to address their moral principles along with the wrong and fairness standard in the organisation. The main purpose of any ethics is to stop any business organisation from any wrong and unethical behaviour. If AMT coffee can behave ethically then they can a positive attitude of the customers towards their products. On the other hand, unethical business practice can destroy the reputation of the organisation in the competitive market that may create dissatisfaction among the customers. Therefore, the ethics creates a huge influence on the marketing practices of the AMT coffee, so in order to address the needs of the customers they must be more sensitive. They should be more socially responsible so they can protect the rights of the customers and stop the unethical trading. As an ethical organisation, AMT coffee must avoid the child labour, excessive working pressures and should follow an effective and better competitive strategy.
4.2 Examples of how organisation responds to the ethical issues:
AMT coffee may face different ethical issues such as lack of customer communication, producing poor quality products, incorrect description regarding their product, discrimination in pricing, following deceptive pricing strategy, following different types of pricing strategy in different location and increasing product’s selling price during out of stock of the product. In order to avoid those ethical issues in their organisation, the managers of the AMT coffee should inspire the sub-ordinates to practice the moral consciousness in their organisation (Piercy and Morgan, 2011). Along with that, they should provide ethical training to the employee to avoid those issues. For avoiding eth unethical practice they must implement an effective ethical framework.
4.3 Example of the consumer ethics and its effect on the marketing planning:
In order to proceed with the good marketing plan, it is very much important for the AMT coffee to consider the customers right. AMT coffee must not be immoral during selling their product because it may create the bad brand image and destroy their acceptance in the market. For example, if any customers buy some products inn illegal way they should not consider their rights. They should not consider any false claim of the insurance from the customers. Along with that, if customers are distributing any kind of product in illegal ways then it may create legal issues in their organisation.
The above discussion concludes the fact that any organisation cannot produce and sell their product immediately. For selling any product by generating an effective amount of profit, it is important for the AMT coffee to have ethical process, otherwise they may face some legal issues and it may destroy their brand image in the market. Along with that, it is also important to conduct an effective market research so they can understand the actual need of the customers and the future profit level of the product.