Company Description
Theranos is an e-commerce startup specializing in clothes and fashion wear mostly for the young generation. The popular culture influences most young people they witness on the internet, TV and other programs hence they are aware of the latest trends in fashion. The speed of the internet has also increased the expectations of the young generation consumers, and thus they are demanding products that represent their culture. The company will focus on offering the young customers with youth-oriented fashion wear, which are popular around the world no matter which city of the United States they are in. The significant difference between Theranos and other e-commerce businesses is that it will mainly focus on delivering its merchandise to all smallest towns in the United States (Fletcher, 2016). The company will further focus on targeting youths between 11-18 years which are easily influenced by what they see on TV or the internet.
Marketing Goals and Objectives
Theranos marketing goals include merging the internet marketplace to reach its target market. The users of the website will be the young generation who make up the highest number in the United States generation. The target market is looking for a cheaper and convenient way of getting the latest fashion materials, delivered up to the small towns where they live. The marketing objectives and goals of the business are mentioned below;
Reaching half of the small towns in the United States as one of the ways of reaching more people
Making contacts with all top designers around the world to secure the best products
Growing its market share to 30% of the e-commerce clothing industry
Achieving sales of over 50 million dollars by the end of the first financial year.
SWOT Analysis
Strengths
The business has established and maintained a strong capital base which enables it to concentrate on its operations
The company has also conducted an aggressive and focused campaign which has clear strategies and goals regarding what is to be achieved
The management team has a wide range of dealing with goods and services targeting the young generation
Weaknesses
The business faces competition from established sellers such as amazon.com and zappos.com
The process of hiring new talent and creating organizational structures may take long
The business does not have money for big budget marketing strategies
Opportunities
There is lack of a retailer targeting the young people living in small towns
The internet keeps the young generation up to date with the latest trends
Most people nowadays prefer showing online as opposed to brick and mortar stores
Threats
More and more B2C e-commerce businesses are coming up threatening the company's market share
Huge fluctuations in prices of supplies may occur
Huge companies are establishing control of supply and distribution channels to corner the market and disadvantage smaller firms
Industry Analysis
The e-commerce market is a semi-mature market which is characterized by high growth rates due to the increase in internet usage, medium barriers to entry and few large competitors. Despite the high level of competition, many companies do not reach the youths in the smallest towns and thus creating an opportunity. The biggest competitor is amazon.com which acquired Zappos in 2009 as a way of monopolizing the industry. The main advantage of Amazon is that it sells nearly everything and thus has a very large market share not only in the United States but around the world as well. eBay is another competitor with a large market share in the country and Europe. The good thing is that the two large competitors in the e-commerce industry are concerned with expansion to other countries and thus giving an opportunity to smaller companies such as Theranos (David, 2015). Therefore, Theranos has a competitive edge because it will be dealing with customers in small towns who feel neglected by the big companies.
Segmentation/Targeting
Over the last decade, changes have occurred in the population dynamics with smaller towns across the United States in the Midwest, west coast and northeast registering the highest growth rates. Today, millions of young people aged between 11-22 years do not live any near urban center and thus making it hard for them to get the latest merchandise. Some of the merchandise which the young generation demands include clothing and shoe products which match the social demands of the youth. This deficit has created a market for small businesses such as Theranos to sell the clothing and shoe products to the youths who live outside urban areas in the country (Debelak, 2000). Theranos hopes to capitalize on the features of the young generation including subculture affiliation and attitude. Teens want to stand out through having the latest fashion trends and the attitude also extend to their style of clothing, hairstyle and lifestyle.
At the moment, Theranos is offering access to the fashion and clothing styles which the young people want. The company hopes to capitalize on the absence of large enterprises such as amazon.com around small towns in the country and keep on bringing more and more products for the young generation. So far, the target market seems to be reacting well to the business as the word keeps on spreading regarding the new e-commerce business in town.
Marketing Research
Marketing research is the process by which customers, manufacturers and end users are connected through information. The marketing information is used to develop and explain the opportunities and problems associated with marketing, evaluating actions of marketing and marketing performance with the aim of helping the company come up with the best marketing strategy (Luther, 2011). Secondary research refers to the type of marketing research which is already compiled and organized. Conducting a secondary marketing research on the target market will focus on reports and studies by government organizations, trade unions and other businesses in the industry. For instance, the government economic report points out that within the next decade nearly all types of shopping will be done online (Belanger, 2016). Such information is good news for Theranos since it relies on the internet to reach its target market.
Conducting a primary market research on the target market will focus on some methods such as observation, surveys, interviews and face to face questionnaires. Such methods can help a lot in getting first-hand information as opposed to secondary research which relies on already edited information.
Positioning
Competitive analysis
Amazon
Strengths
The organization has a large capital base and a large pool of resources which it can use to mount a challenge to other smaller companies such as Theranos
The company is also operating internationally making it a force to reckon with in the commerce industry
The company also boasts some of the best talents in the world related to finance, economics, marketing and technology
Weakness
Its expansion to other countries has made the company forget the domestic market which it is losing
Failure to stay in touch with consumers in smaller towns across the United States
eBay
Strengths
Availability of the best talent in the ranks of the company gives it a competitive edge
The company is a leader in the electronics and technological accessories industry
The company has a large capital base which it can use to compete with smaller companies
Weakness
EBay mostly deals with electrical appliances and thus has lost the market on other frontlines.
Does not offer services to remote areas and the towns outside major urban centers in the United States
Wal-Mart
Strengths
The company has both online and physical presence in the form of stores and thus has a lot of advantage of other businesses in the same industry
Has a large established market base which is hard to be penetrated by other companies
The large capital base gives it a competitive advantage
Weaknesses
The industry is changing, and most businesses with physical locations are closing down
The online presence of the company is not strong and thus can be challenged by smaller businesses
The Points of Difference (POD) between Theranos products and those of competitors is that Theranos focuses majorly on clothing and shoe products related to the young generation while the competition focuses on all products for all age groups. The Points of Parity (POP) of the products is that they all use the same platform of the internet to be distributed to the final consumer (David, 2015). The value proposition of the company is that it will strive hard to make the latest fashion trends to its consumers outside urban centers to the small areas since the bigger companies do not bother to do so.
The value chain of the company will focus on getting the clothing and shoe materials from the manufacturers and use its website to market them to the final consumer. All the shopping processes will be done online including payment, and the product will be delivered to the consumer's location of choice.
Branding
The brand personality the company is choosing for its products is fun and exciting as it will offer the young generation with the latest trends in fashion. This is a good choice since most of the young generation focus on having fun and living an exciting life when choosing the products which they want (Luther, 2011). The brand elements of the company will include a logo stating "enjoy the life through fashion, some bright colors including red, blue and green and images showing young people wearing the latest technologies.
References
Belanger, L. (2016, APRIL 15). What Entrepreneurs Can Learn From Theranos's Fall From Grace. Retrieved January 22, 2017, from https://www.entrepreneur.com/article/274186
David, F. (2015, October 22). What Is Theranos's Business Model, Anyway? Retrieved January 22, 2017, from http://www.forbes.com/sites/frankdavid/2015/10/22/theranos/#7f64c9bbb128
Debelak, D. (2000). Streetwise Marketing Plan: Winning Strategies for Every Small Business. New York: Adams Media.
Fletcher, H. (2016, June 2). Theranos — A Cautionary Marketing Tale. Retrieved January 21, 2017, from Target Marketing: http://www.targetmarketingmag.com/article/theranos-a-cautionary-marketing-tale/
Luther, W. M. (2011). The Marketing Plan: How to Prepare and Implement it. New York: AMACOM Div American Mgmt Assn.
