Marketing plan part 1 – Situational analysis.
Objectives of Alaise.
PESTLE analysis of Alaise.
Target Market Analysis.
Key success factors of the café industry.
Marketing plan part 2 – Marketing strategy.
Product/ Service strategy.
Promotion/ communication strategy.
Gift card promotions.
Website announcement and promos.
Alaise (Pronounced in French) is a bookstore café with unlimited WiFi located in Canberra, In the heart of Belconnen area. It is estimated to be launched to the public around December 2020. The venue is posh, unique and laid back, giving everyone entering the room that welcome feel surrounded with a collection of hand-picked best seller books displayed which is accompanied with fresh house-brewed coffee odour lingering around the café. Not to mention the signature wine collection we have hand-picked by our wine experts.
Alaise focuses on working with local wineries, coffee brewers and bookstores to provide an authentic experience for our customers. Alaise also has partnered with book suppliers to make sure that we keep our books to always be updated as frequent as we can. Our staff will be RSA-certified and will be hired by their level of knowledge towards wines and coffee. Being well informed and have a passion for books is preferable. Attitude is the key to our candidate process as our goal is to create a healthy environment in our café to be able to work well as a team.
Nestled in the heart of Belconnen area, Alaise will be the perfect place to get a perfect cup of coffee or wine while reading hand-picked best seller books. Alaise (Pronounced in French) is a bookstore café with unlimited WiFi located in Canberra is estimated to be launched to the public around December 2020. The café will operate in the unique and high-class venue of Belconnen area, giving everyone entering the room that welcome feel surrounded with a collection of hand-picked best seller books. Apart from books, the café will also provide fresh house-brewed coffee, along with the signature wine collection handpicked by wine experts.
The café will work with coffee brewers, bookstore and local wineries to deliver the most authentic experience to its customers. In addition to this, the staff of the café will be Responsible Service of Alcohol (RSA) certified and will be hired according to this knowledge of coffee and wines. In order to ensure that its customers get the updated collection of hand-picked books, the café has partnered with book suppliers and will update its book collection frequently. The café will operate in the café-bookstore industry which includes café that deliver the normal experience of a café along with the services of a bookstore.
To be a friendly, comfortable atmosphere in which the customer can receive high-quality bookstore/café services.
To be the only office for book reading over a cup of coffee or handpicked wine.
The company's aims are to generate significant profits and create a professional and work atmosphere in which both the client and the staff are treated with integrity and respect.
Specific goals of Alaise are:
Profit - In three years, personal income above $50,000 per annum
Clientele - Creating a clientele base of people living and working in the city. Such individuals would want a comfortable environment in which they can "hang out" or read a book.
Employees - Experienced and dedicated workers (at least 51 per cent from low-income neighbourhoods)
Environmental research is a tool of strategic significance. It's a method of recognizing both external and internal factors that may influence the efficiency of the company. The analysis involves determining the degree of challenges or opportunity that such factors might present for the organization (Rothaermel 2016). The findings of such assessments are then incorporated into decision making. A business may use multiple analytical methods but one of the most popular environmental analysis tool is the PESTLE analysis. A PESTLE analysis is a method for analyzing the main factors (Political, Economic, Sociological, Technical, Legal and Environmental) that affect an external organization. It provides insight into the external factors that influence their organisation (Yu, Ramanathan and Nath 2017).
Political - The key political element influencing the Alaise is the indicator of health and safety and food protection. To run the coffee house successfully, the cafe has to get food safety certificates. The cafe will also need efficient steps to manage pests, too. In addition to this, Alasie will also have to adhere to drinking policies in the Canberra region as it is also offering wine to its customers. Moreover, the trade relations of Australia with other countries will also affect the café as such trade relations play a significant role in determining the cost of wine and coffee in Alaise.
Economics – The café will operate in the high-class region of Canberra which provides safety against economic factors. However, economic factors like per capita income can significantly affect the profitability of Alaise. This is illustrated by the fact that growing customer expenditure index is directly related to the increased demand for premium coffee and wine. Taxation level can also affect the wine and coffee business along with cyclical patterns which effect wine distribution.
Social – A fitness consciousness is an emerging movement in culture against food and beverages. Since coffee contains high levels of caffeine, many believe it is an unhealthy drink. Recently, this has contributed to lower demand for coffee. At the same time, this phenomenon has also culminated in decaffeinated products containing coffee seeds albeit with lower quantities of caffeine. Moreover, Rothaermel (2016) identified demographic groups driving the luxury wine segment: Generation X and Baby Boomers. Authors further stated that this trend should take effect by 2020, with millennials expected to become the industry's new drivers. This means that Alaise has to focus on millennials in its marketing plan to capitalize on this favourable trend.
Technological - The introduction of modern, coffee-specific devices is another major change in the coffee market. Each electronics store now has coffee grinders, espresso makers, drip machines. Such devices make coffee consumption simpler than ever, thereby enabling consumers to undertake brewing at home. Moreover, the prevalence of ebooks presents a threat to the café as people can opt of ebook services like kindle, google books and other virtual libraries rather than going to café for the same.
Legal - As a commodity intended for consumption, coffee comes under food and beverage legislation in almost all jurisdictions around the world. Which means it is subject to a variety of laws as to how to store, ship, and brew it. Additionally, coffee includes large quantities of caffeine, so in some regions of Australia, it is subjected to caffeine standards. Moreover, the café will also have to adhere to wine distribution regulation and will have to get the license from the respective authority.
Environmental - The cafe will have to import coffee beans directly from the producer or procure them from a local importer. In either case, environmental disasters and climate change in producing nation can heave a significant impact on the business operations of Alaise. Other natural forces that can affect the business are earthquakes. As these are becoming common in New Zealand, we have to ensure that the premises are insured. Earthquakes could cause a lot of damage and may result in the premises being shut down for some time. Income will be lost for that time being.
A competitive analysis is a technique where the main rivals are established and their goods, pricing and marketing strategies are studied. This helps the business to build strong market plans by improving upon the strategies of business competitors. In order to do so, the competitive analysis includes an analysis of the target market and an analysis fo competitive environment which facilitates the identification of key competitors and their market position.
A target audience is a community of customers or organizations that are most likely to purchase the goods or services from the business. Since those customers will actually want or need the deals of a business, it makes the most sense for the business to concentrate its marketing strategies on targeting them. In case of Alaise, the demographic characteristics of the target market ranges from 20 to 55 plus individuals. The combination of the bookstore and coffee shop makes the demographic market of Alaise so broad. For the book store, the 20 to 25 age groups are the key customers. It is because of the tertiary institution surrounding the café (Truc 2017).
Since this is a bookshop and a coffee shop, students visiting coffee shops generally like to sit down and read. The older target audience is for ages 55 and up. This age group is chosen since many people of this age group have left or retired from the workforce. Retired people obtain the gold plus card which allows them the benefit of travelling free after 9 am on public transport. Within this age group, many people prefer to meet friends and hang out. Moreover, the target population mainly belongs to the upper-middle-class or upper-class households and is able to pay high prices for better services.
The key competitors of Alaise are Muse, Smith’s Alternatives and Beyond Q. All of the key rivals operate within the same industry and offer substitutes of products and services provided by Alaise.
Nestled in the trendy East Hotel between Kingston and Manuka, Muse is a gathering place for those who appreciate a grenache with their Grenville, and a nice washed rind from their Winton. Muse starts with a traditional Australian café breakfast, where classics sit next to more contemporary fare. As the day progresses Muse turns effortlessly into a more up-to-date lunch and dinner spot offering a seasonal, elegant bistro menu (Muse n.d.).
According to Peter Strong of the Council of Small Business Australia, Smith's Alternative opened as a bookstore in Canberra in 1976 and soon built a reputation for selling books on politics, sex and philosophy which were hard to find. Smith's Alternatives is a comfortable, cozy spot, in the large outdoor area, with couches spread out. Inside the tiny café, sofas and comfy-looking seats line the main wall. For a daily limit, the coffee prices are a little high at $4.20 but the atmosphere is worth it. The only major drawback is a lack of books, one shelf is not a lot of choice (ABC 2015).
Beyond Q also operates in the café and bookstore industry. With shelf space worth kilometres, Beyond Q has a very wide variety of stocks to choose from – fiction and non-fiction, very old, very recent, and all the vintages in between. Fiction is a particular strength although it only accounts for 35% of the cafes' total stock (Morgan, 2019).
The industry has a small concentration of market share, with only one company controlling more than 5.0 per cent of the market. The market is highly fragmented, and historically involves a significant number of owner-owned cafes run by single establishments.
Because the industry is highly competitive, it is important that operators have an excellent understanding of their business and the ability to adapt rapidly to evolving consumer tastes and preferences (Gargano 2015).
Industry knowledge, such as hospitality or retail experience, is a vital factor for success in a high-income, low-profit, high-loss-prone sector.
It is important that industry players reduce costs and waste, particularly with regard to food inputs, for an industry characterized by low-profit margins.
A consistently high level of quality is expected when preparing, delivering and serving coffee and food products to meet consumer needs and maintain positive word-of-mouth (Gargano 2015).
Marketing strategy is a forward-looking long-term, approach, with the basic aim of gaining a strategic advantage that is sustainable. Strategic planning includes assessing the strategic initial situation of the organization before formulating, reviewing and choosing a market-oriented competitive strategy which corresponds to the company's priorities and promotional goals. According to Pappas (2016), the marketing plan identifies target audiences and the value proposition to be delivered on the basis of an assessment of the best business opportunities. The marketing strategy of Alaise is mentioned below.
A product strategy builds from the company's ultimate vision of its products. It specifies where the product is going to end up. Alaise will decide the course of your product efforts by setting a marketing strategy. Product positioning strategy refers to orienting brand in such a manner which facilitates favourable reception in respect of competing product. Positioning is achieved through marketing mix which is specially designed for the business (Pichler 2016).
Companies can position their products on the basis of its attributes and features, price/quantity, product user and competitors. Product positioning strategy is mainly classified in a single brand strategy and multiple brand strategy. Single brand strategy is used for companies having a single brand which can be placed in one or more targeted market segment. A business must seek to align itself with a key segment of a market where it can play a dominant position of optimizing its profits from one particular brand. In turn, it can also draw other customers beyond its centre from other segments. On the other hand, multiple marketing brand strategy, Multiple brands are launched to strive for growth by selling varied goods in specific market sectors and avoiding competitive challenges to a single brand.
The product strategy of Alaise employs a single brand product strategy. In order to employ this strategy, the café will position itself in such a manner that it can stand competition from its competitors through product differentiation.
Distribution Strategy is a method or plan to make a service or product viable across the supply chain to the potential customers. Distribution strategy develops the whole approach to the availability of the product beginning to take feedback from what the client communicated to the target audience to represent in advertising campaigns (Gonzalez Nebot 2018).
Distribution strategy of Alaise will include the most suitable distribution channel as books are bought directly from the manufacturer, that would then be distributed to the customers. A certain amount of the mark up is applied to the customer before it is passed on. The delivery channel of the coffee house will be special, as it will take more than three channels. Items for the coffee house will either be purchased directly from the manufacturer, or from the producer's wholesaler who buys them from producers or imports them. Thus, the distribution channel of Alaise will include produce, wholesaler or retailer, the customer.
Alaise will concentrate on 4P's approach to marketing.
Product - The attention of the cafe will be on the one-roof coffee, wine and books. The cafes' focus is on why clients should come over to the cafe. This offers them the luxury of being able to purchase a book or magazine and then relax with coffee and wine afterwards. The benefit for customers will be that they can relax and read there, too. People will get in on one of the items. It's possible the coffee at least would have been ordered (Wu and Li 2018).
Pricing- The regular coffee price is 4.60 which will allow the cafe to make a $2.25 profit. Compared with business competitors this price is fair for the starting years. In certain cases, the prices off books will vary, and maybe the same prices. It can be useful to use schemes such as gift cards because it can be another way to advertise our shop.
Promotion - The products and services are promoted through the use of flyers and Facebook. , As the cafe is in its initial years, it will first focus on attracting customers locally. We're even going to run deals purchasing 5 cups of coffee, and get the 6th free. Also, run reward card programs where a consumer can get 10 per cent on the books after their third purchase. By actually engaging with consumers and achieving what they want, business partnerships can be made stronger.
Place- As the cafe is located in the Belconnen area, Alaise will not concentrate on hitting new markets. The marketing strategy of the cafe will be concentrating on establishing a cafe in the current market.
A promotional mix is a more comprehensive approach to one of five marketing mix elements — Promotion. Other factors include people, product, place and price. A promotional mix helps to improve the effectiveness of promotional campaigns by segmenting the target audience. It also improves communication among stakeholders and facilitates better delivery of promotional content.
Promotional mix of Alaise includes the following:
Rewarding most loyal customers will allow the cafe to reap the most lucrative long-term benefits for the business. Alaise will hand out such cards to see who acts as the most loyal patrons among customers. Alaise will then hand out loyalty rewards — a free coffee or drink for the rest of the week or a fun mug — after making a certain amount of transactions during a given time period.
Gift card promotions
The cafe will also send its customers a free gift card, whether it is a card that they could use to reward themselves or a gift that they can send to others. The cafe just needs to get its customers' email address, and everything else can be done through online services, with the aid of a promotions service. Alaise will take care of emailing the customers with the redemption code, allowing them to redeem the offer later at their most suitable moment (Poljic, Tesic and Kosutic 2018).
Website announcement and promos
Alaise can easily post the latest updates about the cafe, from new coffee mixes or books to upcoming promotions, through a website, social media presence or email marketing. In addition to this, as the cafe is target local consumers, a website or blog will prove a valuable promotional technique. This way, Alaise's customers just need to go online or use smartphones to search for the new offerings of the cafe.
As one of the Marketing Mix's key elements, promotional mix will help the cafe to bring its goods and brand closer to its consumers. Since its a new cafe establishment facing tough competitiveness in the local scene, the strongest way to promote its product's quality and the value of your service to your target audience is to attract them with appropriate and effective promotions.
The true secret to marketing success is the ability to implement the strategy, performing every task until the company has gained more consumers than it can manage. A lot of businesses put together a strategy but then do not follow through, wasting too much time and losing real opportunities to create a successful company. Execution plan for Alaise includes an action plan for the first 3 years and control mechanisms to monitor the performance of the marketing plan and taking corrective actions if necessary.
Marketing action plan
What to do
Developing café website
Surveys to assess market needs
Procurement of materials
Creating partnerships with suppliers
6 months before starting business
1year before starting business
3 months before starting business
3 months before starting business
6 months before starting business
Controls of the marketing campaign equate the actual outcomes with the marketing strategy to ensure you are on schedule. Daily analysis of these controls will help the company to boost its efficiency when changing plans to better fulfil the goals of the marketing plan. The monitoring mechanisms for the marketing plan of Alaise are mentioned below.
Measuring Customers’ Attitudes
It involves assessing consumer perceptions by using various approaches such as feedback and suggestions, consumer tables, customer survey, etc. It offers information regarding new customers, lost current customers, relative product quality, unhappy customers, relative service quality, market knowledge, preferential target market, and other useful information (Kelsey 2017).
Measuring Stakeholders’ Attitudes
It is about assessing or documenting the behaviours of the stakeholders. This demonstrates the trend of choice, behaviour and overall reaction of stakeholders towards the organization and its offerings. The owners are manufacturers, distributors, staff, shareholders, service providers and so on. Stakeholders have a critical involvement in and influence on the success of the company.
Determining brand awareness through online surveys can also help to evaluate the effectiveness of the marketing plan. Since Alaise is a new establishment, effective brand awareness is vital for business success (Kelsey 2017).
Monitoring website traffic involves understanding who uses the website, from where visitors come from, and their actions when they arrive at the website – insight into targeted users' preferences and behaviours (Kelsey 2017). This knowledge will help the establishment to concentrate on doing more of what works better for conversion rate and helps business to cut or repair something that doesn't work.
Alsaie can also measure repeated visitors to determine whether its marketing is effectively performing or not.
Corrective actions are mentioned in the plan to ensure that Alsaie can improve the performance of its marketing activities in case it's not performing as per the required standards.
To improve customer attitudes, the company can identify consumer perceptions and compile the data for interpretation which would help to form an action plan. Moreover, stakeholder management can be used to improve the attitudes of stakeholders (Kumar and Patra 2017). For brand awareness, the café can engage in aggressive promotional activities through online channels and flyers. In addition to this, search engine optimization and similar tools can be used to improve website traffic, while discounts and loyalty coupons can be used to motivate repeated visitors,
Marketing plan is one of the most important business activity which not only provides information regarding consumer needs and wants but also facilitates the development of marketing mix for effective promotion. The marketing plan of Alsaie includes environmental analysis which presents the details of business competitors and mentioned the way business competitors position themselves in the market. The target market of target market ranges from 20 to 55 plus individuals. The combination of the bookstore and coffee shop makes the demographic market of Alaise so broad. For the book store, the 20 to 25 age groups are the key customers. It is because of the tertiary institution surrounding the café. Moreover, the product strategy of Alaise employs a single brand product strategy. In order to employ this strategy, the café will position itself in such a manner that it can stand competition from its competitors through product differentiation. Distribution strategy of Alaise will include the most suitable distribution channel as books are bought directly from the manufacturer, that would then be distributed to the customers.
Based on the aforementioned analysis, the following recommendations are suggested to Alsaie:
ABC. (2015). Historic Canberra bookshop smith’s alternative saved from permanent closure. Retrieved from https://www.abc.net.au/news/2015-04-22/smiths-alternative-in-canberra-saved-from-closure/6412270
Gargano, S. (2015). IBISWorld industry report. Retrieved from https://www.konacoffeefarmers.org/wp-content/uploads/2015/05/Cafes-and-Coffee-Shops-in-Australia-Industry-Report-Apr-2015.pdf
González Nebot, P., 2018. Marketing plan of Quin Cafe.
Kumar, S. and Patra, S., 2017. Does promotion mix really help to enhance brand equity: A literature review. Asian Journal of Management, 8(4), pp.1387-1392.
Morgan, C. (2019). Beyond Q followed to Weston by Curtin community drama. Retrieved from https://www.abc.net.au/news/2015-04-22/smiths-alternative-in-canberra-saved-from-closure/6412270
Muse. (n.d.). Muse. Retrieved from http://www.musecanberra.com.au/
Pappas, N., 2016. Marketing strategies, perceived risks, and consumer trust in online buying behaviour. Journal of Retailing and Consumer Services, 29, pp.92-103.
Pichler, R., 2016. Strategize product strategy and product roadmap practices for the digital age. Pichler Consulting.
Poljić, M., Tešić, D. and Košutić, N., 2018. Participation of digital promotion in the promotional mix of small enterprises. Strategic Management, 23(4), pp.32-39.
Rothaermel, F. T. (2016). Strategic management: concepts (Vol. 2). McGraw-Hill Education.
Truc, N. (2017). Business Plan for Existing Venture: Papu Cafe.
Wu, Y.L. and Li, E.Y., 2018. Marketing mix, customer value, and customer loyalty in social commerce. Internet Research.
Yu, W., Ramanathan, R., & Nath, P. (2017). Environmental pressures and performance: An analysis of the roles of environmental innovation strategy and marketing capability. Technological Forecasting and Social Change, 117, 160-169.
Kelsey, T., 2017. Social Media Monitoring and Analytics. An Introduction to Social Media Marketing (pp. 123-148). Apress, Berkeley, CA.
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