The purpose of a marketing audit report is to enable an organization to analyze and evaluate the effectiveness of the marketing department relative to the use of alignment skills, processes, and systems because these processes affect the return on investment. Information revealed from this process can disclose the need for opportunities that can improvement the present marketing processes. As an example, if a company desires to achieve a higher performance level in its business, there will be the need to increase effectiveness while also improving the return on investment (Patterson, 2009). This could mean that the organization needs to improve the training of employees as well as operating systems or perhaps hire a subject matter expert. These decisions would also affect the annual budget, planning cycle, and other business processes. This is some of the benefits of the marketing audit.
This report is a market audit report that concerns Roxy, a Quiksilver Rossignol’s line of clothing, accessories, and surf equipment (Shum, Taing, & Tay, 2007). As the Managing Director this process was performed because the company desires to further its marketing prospects in the future but needs a review of its current and past performance. This will be useful information as the company will gain knowledge concerning what has been done correctly in the marketing process in the past and what needs to be done differently in order to benefit the marketing process over the long term. There are three concerns that I believe are of importance to the company and those concerns are answered within this report. The concerns include:
Action that the company should take regarding the findings of the Porters Five Forces Analysis?
Why Roxy desires their customers to have a routine response behavior.
Main Obstacles Observed via the PESTEL Analysis
The political and legal ramifications are very important to the organization because of the company’s financial dealings. In Australia, Roxy must comply with the Trade Practices Act relative to the production company products and consumer rights ensuring that counterfeit products are not used. Quiksilver is a member of the Anti-Counterfeiting Action Group which combats copyright infringement with the country of Australia. The issue of counterfeiting has been a relatively small issue in Australia with Paddy’s Market in Sydney, Australia reporting a turnover of $3.5B per year. However, these markets are growing rather rapidly especially over the last 10 years with an estimated total loss of over $300M due to infringement. While the Australian Copyright Act could be used relative to this process, the process is very costly as well as time consuming. The Australian Government’s commitment to the World Trade Organizations’ Trade Related Aspects of Intellectual Property Rights agreement, criminal procedures can be brought against any offenders.
The cultural and social environment for the organization is of importance based upon the surfing culture; therefore, the company’s line of products has been designed to please the lifestyle of this culture. This means that consumer pricing is of great importance to cause younger people to become interested in surfing thereby increasing profit. This also means that Roxy cannot perform any action that will bring about any negative effect relative to the long-term surf image. It is also important to note that women’s surfing in Australia has been steadily growing because of the first professional female surfer’s event. Recent research has revealed that there has been a 12 percent increase in women’s surfing in 2005 which represents one in every ten participants being a woman. There is also the possibility that this number could be somewhat higher. These figures represent an increase in revenue for Roxy. It should also be noted that since Quiksilver Rossignol has indicated based on its 2005 Financial Statements the taking of Roxy to the Asian-Pacific market. This will also require an examination of the cultural environment of the Asian countries of which the company would be entering. There could also be the need for a completely different marketing mix for this marketing region.
The technological environment reveals the company is proactive when using the online medium in business giving the company an advantage when selling its product. However, one of Roxy’s major competitors has a MySpace page which Roxy does not have at this time. To meet this challenge, it has been suggested that Roxy either create a MySpace page or do something similar to meet this challenge.
The PESTLE analysis has revealed that from the economic front, interest rates and household income has affected the company since the brand changed to Quiksilver Rossignol. To limit the effects of increased interest rates on borrowed money, the company entered various interest rate swap agreements with all revenues and expenses converted to the American dollar. Quiksilver Rossignol is also a publicly listed corporation on the NY Stock Exchange which gives the implication that the economic environment is of great importance to the company as shareholders rely on the economic conditions to make business decisions concerning buying certain shares.
Action Roxy Should Take Based on Findings of the Porters Five Forces Analysis
Information was also gathered for this marketing audit via the Porters Five Forces Analysis. The intensity of competitive rivalry within the industry revealed that Australia’s leading surf retailer; Jetty Surf which is also a retail chain is the leading female surf brand. Other competitors include Billabong Girl, Rip Curl Girl, and Wahine. Each competitor already has a plan in place to enable their success within this market.
Billabong sells surf wear under other specific brands to include Palmers Surf, Honolua Surf, and Von Zipper. This competitor also has a skating brand that is specific. This company is listed on the Australian Stock Exchange. Another important aspect of this competitor is that the brand is well known and is second only to Nike in brand recognition.
Rip Curl Girl is a brand of Rip Curl which is an Australian manufacturer and also retailer of surf wear under the Palmers Surf, Honolua Surf, and Von Zipper brands. This competitor is also looking into the skating market with a brand element. The company is listed on the Australian Stock Exchange. It is also believed that this brand is also second to Nike relative to brand recognition.
Rip Curl Girl, a brand of Rip Curl, is also an Australian manufacturer and retailer of surf wear and surf gear; however, this company is not publicly listed on the Australian Stock Market. It is a private company that was found to be in the top 15 best known brands in Australia. The company sponsors one of the largest surfing competitions, the Rip Curl Pro where the competition for the title is fierce with the world’s top 40 being in competition.
Wahine (Hawaiian for woman) is an Australian manufacturer for swimwear that is modern and wearable. This is an equal competitor with a beautiful swimwear line. This designer brand oriented surf brand does not illegally take market share from Roxy.
Threat of new entrants is not likely at this time. High set up and distribution costs also deter new entrants. Lastly, the area is well saturated making it difficult for a new competitor at this time.
Risk of competition from substitutes is of concern because any customer will compare prices, designs, as well of quality of Roxy’s products. The key is to ensure that our product line is of the best quality thereby keeping repeat customers. Roxy’s female customers are not in the workforce; therefore, Roxy pricing must be sensitive to these customers. The marketing audit suggests that in order for Roxy to prevent competition from other competitors, Roxy should diversify its product line with low-end surf wear with focus on the younger female consumer with a higher priced product for the targeted older female group.
Why ROXY Desires Their Customers to Have Routine Response Behavior
One of the main reasons that Roxy desires that their customers have routine response behavior is to ensure a very clear understanding by Roxy of how the consumer buys, why the consumers buys, and what the consumer buys which is valuable. The Roxy girl persona is being fun, exciting, alive, confident, and being naturally beautiful. This has given the company its innovation as well as simplicity. Consumers can change their behavior based on other brands and changes in behavior. By having access to surveyed information, Roxy can make adjustments to its specialized products to include surf boards and swim suits while also meeting the needs of its younger, unemployed, clientele. The company can also exercise time management relative to consumer purchase of products by understanding what the consumer likes and will buy.
Roxy can also gather an understanding of situational influences which affect the way in which female consumers purchase Roxy products. By seeing other females on a beach wearing Roxy clothing, a stimulating affect happens causing the purchase of more Roxy products. While this may be a short lived process, there will still be the purchase of products that can be worn by the customer with great satisfaction.
Conclusion
The Marketing Audit has revealed a tremendous amount of information. The summary of the competitive analysis in the market for women’s sportswear includes information relative to the target market, product, place, promotion, price, potential competitive barriers, and likely response. This is most vital information for Roxy allowing a clear view of what the competition is doing and what Roxy needs to do in order to become even more competitive.
Roxy’s strength is its position in being a brand of Quiksilver Rossignol with recorded 2006 revenue of over $107M in net income and $2.36B of revenue with Roxy accounting for approximately 30 percent of these figures. This is financial strength as well as good positioning. The company also has market strength and brand name recognition.
The major weakness for Roxy at this time is expense with the company coming into the realization of price sensitivity within the youthful people’s market. Consideration is being given to the creation of a cheaper brand that will still exhibit as much quality as possible. There is the need to attract and keep customers with a reasonable price; however, the product must always be a quality product.
Opportunities include expansion into the Asian Pacific market which would be indicative of an increase of the Quiksilver Rossignol’s international market. This would bring an increase of 49 percent in the next fiscal year. This is a great opportunity.
Lastly, the threat to Roxy involves cheaper substitutes. This process could steal market share. Billabong is also considering diversification into the female market. Please review this information to see if there are any other questions that have not been answered relative to this report.
References
Patterson, Laura. "Marketing Audits Lead to Improved Marketing Performance." 2 Dec. 2009. Web. 14 May 2016.
Shum, Jeremy, William Taing, and Danzel Tay. "ROXY - Marketing Audit Report." Www.roxy.com. 15 May 2007. Web. 14 May 2016.
