What advice would you offer “Tyrrells Chips”, as to how to develop and grow its customer base amongst customers from the higher social grades, without either changing or losing the perception of it products coming from Herefordshire Farmer?
The advice to Tyrrells Chips in developing and growing its customer base amongst customers from the higher social grades without losing its image of being UK countryside product at the same time not changing or loosing the perception of its origin of the product (i.e. Herefordshire Farmer) is as follows:
The company offers a product which is healthy in a sense it has low fat content, tasty in a sense it has more starch and environmentally ethical product in respect of low carbon footprint as the chips are local farmed and processed in Britain. These three attributes are highly important to customers now days regardless of their social status. The company should undertake promotion campaigns to highlight these facts to its customers and potential customers via the media with largest audience of the targeted market .These media channel are Golf channel, and UK vogue magazine to mention a few.
The company should sustain its personal customer experience. This is very important as it sales its product to customers and not consumers. These customers are mostly prestigious retailers such as Harrods .Whom every manufacturer wishes to sale its product to. This highlights the importance undertaking concerted effort to make these customers royal to the Tyrrells Chips brand. This may include being a reliable supplier who meets delivery targets.
Increase product accessibility:
The company should evaluate its distribution strategy to ensure its product is easily accessible to the targeted market segment. As obvious as it might seem the consumer always buys what he/she finds in shop shelves.
We believe if those three aspects are consistently and persistently done over time. The business will sustainable grow without jeopardizing the perception that the product is from Herefordshire Farmer. It is specifically for that reason we did not propose franchising as the growth option as it might dilute the brand image over the mid and long term.
What specific sales strategy and structure might you advise ‘Tyrell Chips’ to employ eventually, to further develop long term customer relationship and equally long term value with its customer? Why would you recommend this?
Sales forces represent a major investment for any company. The right sales force strategy for a product is essential for the success of an organization. A good arranged sales and marketing strategy help business reaching their goals and ensure an increase in the market share when competing in market place. The sales strategies can be grouped into two main categories namely the direct and the indirect sales strategy. (Kotler P 2002)
A direct sales strategy is the sales strategy which involves going head to head with the competition. It means that the company struggles to compete and win the various customers in the market at the expense of their competitors through direct confrontation i.e. its superiority in the same features offered by the competition. For the case of the Tyrrell’s Chips it would mean that they compete with their rivals by having the same kind of product as the competitors and overpower them by the quality of their product.
An indirect sales strategy on the other hand will involve the changing of the rules of the sales evaluation process of the buyer. Here the company creates new features that are not similar to the competitors and try to make the features essential for the buyer’s buying process. For the case of the Tyrrell’s Chips it would mean that they compete with their rivals by making the product they offer contain unique features that are not found in their competitors products and communicating these features to the customers
The sales strategy that I recommend for the Tyrrell’s Chips is the indirect approach. In this sense is way in which the indirect approach can be implemented is by maintaining the unique position that it has established in the market. The additional activity for this approach will be how to communicate the uniqueness of this product to the customers. Further more it can be done by maintaining the big customers who contribute the larger percentage of the company’s profits i.e. the key accounts. There for these could be done through mass communication i.e. advertising as well as key account management.
In advertising, the company ensures that it spells out the value proposition from its product against the crisps being offered by the competitors.
In the process of advertising the product to the customers, the company should consider the creation of a good customer relationship. This can be done through relationship marketing.
The company required to show or prove to current consumers why it makes sense to continue buying with the products form it and not from the other companies. It should still hold on to the key issues that have given them success in the market such as:
Healthy chips to overcome the issue of obesity
Locality of the grown chips
The ownership of the production process
The unique taste of the chips
Hence specifying that these are chips and not crisps
Key account management
In key account management strategy, is a strategy that teaches the people concerned with the key accounts i.e. the key account managers and senior salespeople how to prepare and implement a major account sales strategy. The program teaches a key account management planning process needed to identify strategic accounts, gain entry, broaden account penetration, and improve customer retention. Since key account management often requires team sales, we address the sales techniques and skills needed to use sales teams effectively.
Increasingly companies have found that a disproportionate amount of sales, growth, and profits are concentrated with a few key accounts. This program teaches you how to plan and implement a business development strategy to win new key accounts and to grow your business at existing key accounts. Your key account strategy is critical to the success of your total sales efforts.
The Key Account Management and Strategy training program is intended for anyone involved in the creation and execution of your key account strategy, notably senior salespeople, key account managers, and sales and marketing managers.
The Key Account Management and Strategy program can be customized in content and duration, depending upon the needs and experience of your salespeople. We encourage sales management to participate so that they can reinforce the sales techniques and sales process with their entire sales force.
The above aspects will show create a new buying evaluation for the company’s product and in so doing make them see that the features in the chips are a must.
Critically evaluate the success to date of ‘Tyrrells Chips’ in a declining potato crisp market.
Evaluation of success for the company:
The first reason for success of Tyrrells Chips is it offers a healthy product. The Tyrrells chips are of low fat content which offers less risk to obesity and other related illnesses. This allows consumer to enjoy crisp/chips without compromising their health. This is a very big fact in UK context as slimness is considered beautifully and the government is undertaking massive health eating campaign as part of preventive medicine against diseases such as obesity.
The second reason is it offers tasty product .Unlike other crisp Tyrrells chips have more natural juicy, more natural starch and has more potato flavor. This ensures Tyrrells chips have a competitive edge on purely tasty front over its competitors.
The third reason it offers green product. Tyrrells chips are green because it is locally produced (i.e. farmed and processed) hence it has considerable low carbon foot print. Considering increasing awareness of environmental impact of various produce consumed by the society most of the people in western world have affinity to ethical product and green products are ethical ones.
The fourth reason is change of gender proportion in the market. Traditional buyers of crisp were men because of their fewer concerns to weight and weight has to perceive good looking and beauty in the UK society. This factor was very different for women as the UK society has rigid requirement for women to be viewed as beautifully. Women refrain from any food which is perceived to instigate weight gain to a person. Since a Tyrrells chip does not cause weight gain, this has attracted a new set of consumers (i.e. female) in the product consumer matrix.
The fifth reason is social status pressures. This caused increase in market share for premium crisp over other crisp because from 2002 to 2007 UK experiences an overall growth to the Country economy. This growth ensured people moved up in their earning power and subsequently their social status. It is a very well established consumer behavior for consumer to want to buy products which are usually slightly above their economic status. For example a middle-middle class individual will buy a product targeted for Upper-middle class. This phenomenon can partly explain reason for increase of market share for the premium crisp market over other segments.
Tyrrells small sales force is known to be focused upon ‘building personal relationship’. What is relationship marketing? Why is it such an important feature at Tyrrells Chips Sales Process.
Definition and concept of relationship marketing
Relationship Marketing refers to a long-term and mutually beneficial arrangement where both the buyer and seller have an interest in providing a more satisfying exchange. Relationships between a company and their customers, distributors, employees, referral sources, are vital to continued, sustained growth, and stability. Loyal relationships with these valued individuals make for a strong bottom line. In the early 1990s the concept of relationship marketing was formally introduced into the field of service marketing. The aspect of relationship marketing relies on the fact that creating a relationship ensures that the connection of the company and the customer is never lost and therefore the company can always rely on the customers to be present.
Relationship marketing begins with the company identifying the relative importance of retaining the customers that they have already provided products to. The company can create a relationship by making the customers feel that they are individually remembered by the Company. For example provide the customers who have been trading with the company some financial incentives to their products or to check on them once in a while to ask them how they feel about the product and if they can be further helped in the use of a particular product after they have purchased the product.
Importance of relationship marketing in Tyrrells Chips Sales Process
Knowing that the aim of relationship marketing is to create strong, lasting relationship with core group of customers it is therefore it is to a advantageous for the firm such as Tyrrells Chips to develop long term relationship with existing customers because it is easier and less expensive to make an additional sale to an exiting customer than to make a new sale to a new customer.
More specifically though, the following are the benefits of using relationship marketing to Tyrrells Chips Sales Process:
Saving costs in the company
It is evident that in most cases to find a new customer is much more expensive than to maintain the existing ones. Creating a good relationship with the customers can ensure that the business saves a lot of money in terms of having a larger customer base. Relationship marketing involves continuously courting, interacting and reminding the customers on the presence of your company. These customers are less likely to go racing off when competitors start their campaigns to win them over. Through relationship marketing, customers are made to feel recognized, known and appreciated and this can go a long way toward making them loyal. This therefore will help the Tyrrells Chips to maintain a market of the product in the long run.
An infinite connection with the customers
In businesses regardless of how effective your customer retention efforts are, some relationships will inevitably break down. For various reasons, certain customers will suspend their relationship with you and your business. But those relationships aren’t lost. You can win back these once-valuable customers. Due to good relationship management the service provider gets committed and loyal customers, thus increasing the purchases, which in turn increase the profits of the company.
Often times, repairing a broken relationship is more efficient than trying to build one from scratch. Therefore the Tyrrells Chips should not make the mistake of attempting to re-acquire lost customers in the same way that they acquire new ones. They should rather have a way in which they do not loose the customers at all as they establish a relationship with them. This is another benefit of having relationship marketing in the sales process of Tyrrells Chips Company.
Relationship marketing provides free advertising through the word of mouth by the customers to others as they will appreciate the treatment they are obtaining for the company. This therefore is a service advantage to the company. The advertisement will then earn new customers and increase the revenue base of the company.
To conclude, it is important to note that it’s not an easy task to maintain satisfied customers and that is why it’s important to use the relationship marketing as a key in beating the competitors in the search and retention of the customers in the market. It is important to have relationship marketing for the success of the company.
TASK 5: Marketing communication tools
You are to attend a meeting with Will Chase of “Tyrrells Chips” to discuss new ways of communicating to its customers. Produce a briefing document, addressing new marketing communications tools that could be used, and are not currently and for media delivering the message to the target customers. Please justify your recommendations in terms of benefits each of them would offer, over and above their current approach to marketing communication.
Marketing communication tools:
Marketing communication tools refer to the means in which the organizations or the company is able to let the people know about its existence as well as about the products it offers in the market. (Kotler P 2006)
For the case of the Tyrells chips company, it can be seen that there have been some marketing communication tools used by the company, but there are others which have been left out which are very important to the success of the company. Below is a discussion of the marketing tools that have been used previously by the company as well as the Marketing tools that should be used in order for the company to become more successful.
The marketing tools used previously include:
The personal selling where by their sales force despite being small focused on building personal relationship with their customers who are the independent retailers in the country. The idea of Mr Will Chase was to get to know the customers very closely and he produces crisps which were quite different from ordinary ones that’s why he decided to call it chips instead or crisps because the chips were cut a thicker in order to maintain the natural juice and starch and this also resulted in less oil to be absorbed while the frying process took place
The marketing communication tools that should be used now
The marketing communication tools that the company should use now in order to be more recognized with the public as well as their benefits or advantages for the company include the following:
Direct marketing is basically business from manufacturer to consumer without the involvement of middlemen, whoever it is. This is generally done by mailing the consumer or contacting him directly, so he can know about the products. The use of media advertisements is very limited and whatever little use is made includes only the demonstration of their products with call back numbers. Direct marketing is a boon and a bane, both in some respects:
Advantages of direct marketing to Tyrrell Chips
The following are the advantages of the method of direct marketing; direct marketing involves direct business. So it is cost beneficial for consumers, as there is no price hike due to wholesalers or retailers. Marketing executives can state certainly of the exact response to their products. The profit or loss can be more accurately judged.
This is a paid form of non personal communication about an organization or its products that is transmitted to a target audience through a mass/broadcast medium.
The advantages of using this communication tool by the Tyrrells Chips are that advertisement is flexible. Flexibility allows you to focus on a small, precisely defined segment (School newspapers) or a mass market ,it is cost efficient-reach a large number at a low cost per person, allows the message to be repeated, and can improve public image. Furthermore it allows for repeating the message-lets the buyer receive and compare the messages of various competitors.
Advertising allows for dramatization it also used to build a long term image of a product. Trigger quick sales, Sears advertising a weekend sale.
The aspects of sales promotion is also another important way that the company can use as a marketing communication tool in its expansion process to entice the newer customers to the quality of the chips that they produce from Herefordshire Farmers.
To conclude, it can be obviously seen that there are many ways in which a company can use in order to make it self known to the public. The recommended ways are of the best interest of the success of the Tyrells Chips Company.
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