Introduction
The increasing use of electronic devices like mobiles and laptop has necessitated the constant supply of power. A power bank is increasingly becoming a ‘must have’ for people on the move. Kazam Mobile, the startup mobile company has come up with its Kazam Power Bank (KPB) which can power the batteries in use in mobiles and laptops.
This report starts with the corporate objectives of Kazam. This is followed by a market overview of the power bank market in the UK. An internal and external audit of the market would be presented thereafter. The assumptions for the power bank segment are then presented along with the marketing objectives of the KPB. Then the strategies for KPB are given followed by the promotion programme.
Corporate Objectives of Kazam
Kazam is open to opportunities as they unfold. Kazam is positive about the future and has great plans for it as follows;
Kazam wants to innovate in areas that others have left behind. Hence, the slimmest phone which had actually started off as a brick sized mobile,
The idea is to give solutions which are smart. Hence, one power bank for both the phone and the laptop for the person on the move,
The intention is to offer technology at affordable prices to customers. Technology need not come at a high price when it can be available for much less,
Kazam believe that no two individuals are alike. Hence, they have dissimilar needs which need to be catered to separately,
There is a commitment to produce eco-friendly products which do not harm the environment, and
Kazam’s products contain recyclable materials which can be used in other products.
(Source: About Kazam)
Market Overview
Market is growing at a tremendous rate leading to more competition
The value for the power bank market is expected to grow at a CAGR of 23.1% between 2015 and 2020.
The market for power banks with more than two USB ports is expected to grow at a high CAGR of around 30% between 2015 and 2020
Replenishable power banks are the future of this segment.
A Sandberg A/S (Denmark) and Ravin Group (India) are developing solar power banks
Intelligent Energy Ltd. (U.K.) has introduced hydrogen fuel cell powered power banks
(Source: rnrmarketsearch.com)
Tier 1 in terms of company, North Americans in terms of region and C level in terms of designation were the primary users
The market is segmented by capacity, application and region
Increasing use of gadgets and decreasing prices of power banks drive the market
Sony and Panasonic are among the leading players in this field
(Source: alliedmarketresearch.com)
Marketing Audit: Internal and External
The following explains the current marketing activities of KPB in the context of marketing concepts.
Marketing Mix
Mc Carthy gave the 4Ps of marketing viz. product, place, price and promotion. (Kotler 2007, p. 31).
1. Product – Kazam ha tried to be different from other companies by neither reducing the price too much nor going for better technology. Instead, Kazam has gone for customer needs. Kazam gives one free replacement for cracked screens. It also has a tracking service where a call centre executive remotely fixes problems without a fuss. Moreover, it has offered the slimmest phone ever to the customers.
2. Place – It started off in various parts of Europe apart from the UK. It is spread across Germany, France, Italy, Sweden etc. It has spread into Eastern Europe as well. It uses direct selling through its dealers spread out in various outlets. Its online sales, at the moment, are restricted to the UK. It is being compelled to start its operations in Africa, the Middle East and in South America (Johnson, 2015)
3. Price – Kazam does not offer its smart phones at the lowest price. It offers them at a reasonable price as its focus is on customer need rather than just the price.
4. Promotion – Being a startup, it understands that it cannot withstand the aggressive marketing of the established brands. It uses advertising both in print and electronically. It uses social media also to promote itself. While established brands have exclusive testing teams, Kazam give its phones to the people to use and report bugs. This is a bottom up approach which gives it the mileage in a different manner (Cook, 2015).
SWOT Analysis
SWOT stands for Strengths, Weaknesses, Opportunities and Threats. The underlying assumption for it is that the company must bring its internal operation in line with its external realities (Pahl & Richter, 2009, p. 4).
1. Strengths
The first and foremost strength of Kazam is its attitude. The founders gave up lucrative careers to start a mobile company of their own. Within a short period of three years, they have been able to hold their own against established players. Their main strength is the different approach that they follow. They are neither pursuing technology nor price. Instead, they focus on the customer which is why they are replacing cracked screens.
2. Weaknesses
They have been found to be a little brazen on the advertisement front. The controversy over commodification of women in their ads had come at the most inopportune time. That the brand ambassador was found to be using an iphone instead of their Smartphone was also a blunder that they have to answer to.
3. Opportunities
They need to make their presence in Europe stronger for the time being by starting their operations in more towns and cities across the continent. The Kazam Power Bank is one such product which none of the other mobile companies established or otherwise, would never have thought of. There is more scope for innovation in brands due to the public perception.
4. Threats
The success of Kazam is an inspiration for other startups to join the bandwagon. They need to be vigilant about the ever changing competition. They are weak on the count of suppliers and dealers as they are not the leader in the market. This weakness could be taken advantage of. If Kazam improves, there is every livelihood that the dominant players could gang up against Kazam by blocking off Kazam on this count.
PESTLE
PESTLE stands for Political, Economic, Social, Technological, Legal, Ecological which are the macroeconomic variables that affect the progress of a company in the context of a specific company (Marmol, 2015, pp. 8-9).
Political
Despite Bruit, Britain’s reputation in the rest of Europe has not diminished. Kazam does not have to fear a backlash from the European customer. However, national government could impose duties that could impact its bottom line.
Economic
The uncertainties in the global economy could have a spillover onto Britain and therefore may affect Kazam.
Social
Being a startup, Kazam could fend off Corporate Social Responsibility (CSR) so far. However, the community would evaluate it henceforth by the social activities that it involves in. At the internal level, the employees would already be forming an opinion about the company on a human resource (HR) basis.
Technological
It is Kazam’s policy not to follow technology blindly. However, it can always incorporate new developments in its smart phones but at the same time not dominating the scene. The effort thereof should be subdued.
Ecological
Kazam is committed to recycle components that make up its smart phones. This can be supplemented by a proactive green policy that can give it an image of a benign eco-friendly company that is not a market leader.
Legal
Too much litigation for a startup will not only consume finances but also the time and effort of employees whose services are required in design, manufacturing and sales. They should take a politically correct approach when dealing with issues failing which it can earn them the displeasure of activists like feminists etc.
Five Forces Model
According to Michael E. Porter, industry structure drives competition and profitability (2013, Ch 1). The forces are evaluated as being strong, moderate or weak and are as follows
1. Competitive Rivalry
Kazam face rivalry basically on two levels. One the first level there are small companies similar to Kazam which it can easily endure. However, the bigger players offer tough competition given the resources at their disposal and the clout that they enjoy in the market. Hence, on this count Kazam faces moderate to heavy competition.
2. Buying Power of Customers
Kazam enjoys the trust of customers on this count. The customers are offered a replacement for cracked screens and a tracking service that can solve the smaller issues with the smart phones. These two features can be replicated over time. Nevertheless, given the image of Kazam, this is a moderate threat to it.
3. Buying Power of Suppliers
Kazam is on a sticky wicket here. Though it can convince customers, it has not had success with suppliers. This is because their turnover is not on the scale that it can dictate terms to them. The suppliers could also divert their supplies to its competitors due to the sheer volume that large brands enjoy.
4. Threat of Substitution
There is no immediate threat for substitution. However, a rival has planned to offer replacement for cracked screens in the future. The tracking service for repairs can also be replicated by competitors. Hence, it has a moderate threat of substitution. It should be alert about the moves of competitors every time.
5. Threat of New Entrants
There are enough competitors in the present scenario with established and smaller player making the competition mix. The likelihood of more entrants is less due to the established companies and the smaller ones. The success of Kazam can also be a deterrent to the entry of new players.
Market Assumptions
Falling Costs – The cost of raw material for power banks has been falling for quite some time. This is one of the reasons for the rise in competition in this field.
Increasing Demand – The use of mobile phones has been growing steadily. Even if this saturates, people will go for second mobiles as having one mobile is now a necessity. In case of laptops, the market will not saturate any time soon. With more and more offices switching from desktop to laptop, the need for power banks will sustain for quite some time.
British Firm – Kazam has a reputation of being a British firm. In spite of Brexit, Europeans would like a British product. It is assumed that here would be no barriers from Europe given the public perception of Kazam in particular.
Marketing Objectives for KPB
Modest Start – KPB plans to start with a limited amount of solar Power Banks first in Britain in its first year. Since solar power banks are not being manufactured in Britain, it plans to garner this market. In the first year, it plans to satisfy customers to create a positive word of mouth.
Market Research – In general, solar power banks are the future of this product. A replenishable product will have demand because it does not entail any cost and draws a clean energy source without any pollution.
Growth Strategy – The company has to select between a current and new aspect. The dimensions are products and markets. According to Ansoff’s growth strategy, a new product for a current market would be termed product development (Ansoff, 1957, 114). Solar power banks would be a new offering for the existing market for mobiles and laptops.
Strategies for KPB
Product – Solar power banks would be designed in attractive colours. Kazam intends to offer KPB with two slots as the bare minimum. This is because many people nowadays carry a laptop along with a mobile phone. The other product would have five slots so that up to so many gadgets can be charged simultaneously.
Price – Kazam intends to highlight the future savings from KPB which would entail no costs due to the source being solar energy. This fact would be calculated and explained to the customers at the time of enquiry. The price would be kept at international rates until further reduction is brought about by advanced technology. The solar power banks would first be made available in select malls in each town and city of the UK.
Place – The initial distribution would only be in Britain. From the second year, major cities all over Europe would be serviced. The rest of Europe would also be brought under Kazam’s reach due to the service offered from major cities. Exclusive distribution would be resorted to in the first year of operation followed by extensive marketing in the second year.
Promotion – The product would be promoted as an eco-friendly one as it uses only a clean energy source. KPB would be promoted as a combination with Kazam mobile. The means of advertising the product would be AIDA i.e. attracting the customer’s attention, creating interest, arousing desire and prompting action (Hackley, 2010, 36).
Promotional Programme
Promotion is also known as Integrated Market Communication (IMC). Every section in Promotion has its own priorities for e.g. advertising highlights the quality, the sales force stresses on the price and the supply chain focuses on intensive distribution (Ferrell & Hartline, 2007, 284). This can confuse the customer, who leaves the product for that of a competitor.
The promotion of the Solar Power Bank of Kazam would highlight two important aspects of this product viz. the less cost for the customer and eco-friendliness.
1. Three months prior to launch: An official pre-launch of the product would be conducted with company officials through a press release. The event would be covered in the daily newspapers including the tabloids. Television and radio ads would reach out to the audience as also ads on social media. The ball-park costs for the same is £3500.
As is the case with mobiles, the company’s network would be used to offer the solar power banks for free trial to find bugs in the product. Apart from the network, free samples would be given to trade magazines to elicit their views. The product would garner free publicity in this manner. Customers using power banks running on electric current would also be given samples so that feedback about the solar version can be elicited.
2. One month prior to launch: The help of green activists would be sought in the intervening period. Separate demos would be arranged for different groups of green activists in Britain to familiarize them with the functioning of the solar power bank. Similarly, government officials concerning renewable energy sources would be informed about the benefits of this product. The ball-park costs for this promotional activity is £2500.
3. Launch Day: Celebrities from the world of cinema, fashion and sports would simultaneously inaugurate the product from different parts of Britain. The main launch would happen in London which would be inaugurated by a known political figure. All the inaugurations would be webcast live. This programme might cost £9500.
4. Post launch
Advertising Campaign – The ad campaign would take off from where it had left three months prior to the launch. The opinion of all those who had used the solar power banks would be collected with a pre-created questionnaire in a standard format. These results would be shown intermittently every day in a continuous flow on television. There would be such a campaign on social media, television and newspapers. It may cost around £3500.
Money Off Coupons – Early bird offers would be given to a certain number of customers who purchase this product within the first two weeks of launching. Bulk sales and twinning programs i.e. bundling the sale of mobiles with that of solar power banks would be conducted. It may cost another £4500.
Competitions – College students are those who use laptops and mobiles the most. Essay competitions on the theme ‘Environment Pollution’ would be conducted in colleges and university campuses. The participants would type out the essays on laptops which have been completely drained of power which then run on solar power banks. The performance of the solar power bank and that of the student would be evaluated and disclosed on a separate day. The promotional activities altogether estimate £235500+
Conclusion
The foregoing discussion virtually charted out one of the popular definitions of management being ‘where we are and where we want to go’. The corporate objectives, market overview and market audit show the present situation of Kazam. The market assumptions, objectives for KPB, strategies and promotion thereof show the destination intended.
Kazam started off as a humble startup but had its own vision of achieving it objectives. It is in business on its own terms. It has stood up to the market giants and holds its own. It is a role model for many more startup to come. The blooming of enterprise signifies more jobs and a healthier economy. What is needed is the will to achieve along with a novel approach to things.
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