Marketing Plan - Phase Iii

Marketing Plan - Phase III

Introduction

Wal-Mart's third phase of its marketing plan to market and sell furniture in the new Wal-Mart furniture stores will describe the attributes of its product and services in greater detail than in the first two phases presented by Team B. Furthermore, the third phase will describe the pace at which Wal-Mart's newly proposed product line will move through the product life cycle as well as the factors that will likely impact its movement. Team B will be laying out the product life cycle and the impact it has on the marketing of the product. This paper will identify the positioning and differentiation strategies for Wal-Mart furniture stores. Additionally, the paper will identify the appropriate pricing that Wal-Mart would need to undertake in order to make this endeavor work. Wal-Mart is a giant in this country and others as well, and in order to maintain its status as the "rollback king" in its current stores and any new stores as well as bring on new customer bases, its marketing strategy needs to be well thought out and planned perfectly. Wal-Mart will have to have the perfect marketing mix in order to make this work and thus doing all the proper research is required.

Product Attributes

Attributes are characteristics or properties used to measure or define. In the market place product attributes describe the way in which marketers want consumers to view products and services. Consumers use attributes as a way to measure one organization's products and services against competing brands (Attributes, n.d.)

Product attributes are part of an organizations marketing strategy and used to differentiate an organization from its competition.

Products and services have four main attributes: cost, quality, variability, and availability. Attributes can also include such characteristics as prestige, usability, country of origin, exclusivity, and type such as sporty, family, luxury) (Attributes, n.d.). An organization should focus on defining and marketing the specific attributes that appeal to their target markets in order to meet customer expectation and satisfy needs.

Brand, in and of itself, has value and can also be a product or service attribute. For example, the Wal-Mart brand is associated with product variety, availability, and low cost, which is a reflection of Sam Walmart's vision of giving customers what they want: variety and quality at the lowest possible price, along with "friendly, knowledgeable service; convenient hours; free parking; a pleasant shopping experience" (The Wal-Mart Story, n.d.). Wal-Mart Furniture Stores will follow a similar blueprint for success and market-recognition by being conveniently located in metropolitan and suburban areas and offering a wide variety of household furniture at discount prices. Sales associates will be well-versed in product knowledge and offer a high level of customer service as a means to differentiate Wal-Mart furniture from competitor products.

Product Life Cycle

The Product Life Cycle (PLC) is based upon the biological life cycle. For example, a seed is planted (introduction); it begins to sprout (growth); it shoots out leaves and puts down roots as the roots become adult (maturity); after a long period as an adult the plant begins to shrink and die out (decline) (Marketing Teacher [MT], n.d., 1).

In theory this is the same for any product: introduction, growth, maturity, and decline. The product life of Wal-Mart furniture will step into the introductory phase when the product is launched into the market. As the customer base slowly grows, the market will stabilize as the product becomes more mature. The product will likely face competition after time. Competition could erode the company's market share and sales may decline, which could force the company to either reposition or withdraw the product from the market.

In the introduction phase it may be possible that substantial research and development costs will be incurred in order to get the product to market. In addition, marketing costs may be high in order to test the market, undergo launch promotion and set up distribution channels. Realization of profits on products in the introduction stage is highly unlikely. Products at this stage have to be carefully monitored to ensure they start to grow in the market and generate sales (Tutor2U [TU], n.d., 1). Team B believes the Wal-Mart name will help introduce Wal-Mart furniture stores into the market.

The growth stage of Wal-Mart Furniture is characterized by rapid growth in sales and profits. Profits arise due to an increase in output (economies of scale) and possibly better prices. Because this product will be introduced into the market at the competitive Wal-Mart prices, Team B believes that Wal-Mart furniture can capture a significant portion of the market.

The main purpose of this stage is to persuade customers to buy the product and retain the customers throughout the product life cycle. The growth stage is typically when competition develops. Competition can erode the company's market share. Marketing efforts in the growth stage tend to focus on product differentiation and expanded distribution (Kerin, Berkowitz, Hartley & Rudelius, 2006).

As the industry slows down and sales decline, the product enters the maturity stage. Fewer new buyers are entering the market and costs to obtain new buyers increases. Team B believes that with the Wal-Mart name and existing market base, sales will maintain at fairly steady pace, with new customers regularly entering our specific market. Products that survive the earlier stages tend to spend the longest time in the maturity phase. At this point, promotion becomes more widespread, and a larger variety of media is used to market the product. Marketing efforts are typically focused on additional product differentiation.

Most companies introduce other products at this stage to stimulate the company's profitability. During this stage Wal-Mart furniture may change its furniture styles, or add to the offerings of our furniture types. Any expenditure on research and development is likely to be restricted to product modification and improvement and perhaps to improve production efficiency and quality (MT, n.d., 3).

Decline is a point where the product takes a downward turn in the market. Some companies will try to produce more innovative products or follow consumer tastes. Following consumer tastes often creates intense price-cutting and many more products are withdrawn from the market. Team B believes the Wal-Mart name and loyal customer base will position the

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