Dynamics of Factors Market Segmentation †Free Samples to Students

Question: Discuss about the Dynamics of Factors Market Segmentation. Answer: Introduction The present report focuses on the importance of marketing for the Donald B chocolate maker in Australia. Donald B being the new entrant in the Australian chocolate market should focus on some factors in order to expand their business. It has been evident from recent facts that the consumption of chocolates in Australia has been increasing over the years. Rise in demand for the confectionary products and rise in total number of international players in this industry mainly drives the chocolate market in Australia (Minifie, 2012). The report also analysis about the chocolate market in this nation, which involves- market segmentation, buyers behavior and key vendors analysis. The behavior of the buyers purchasing chocolate is mainly influenced by social, cultural, psychological and personal factors. In fact, micro as well as macro environmental forces are also analyzed in this study in order to highlight how these forces affect the business of Australia. The microenvironmental forces th at are discussed in this study involves producers, suppliers, competitors and publics. In addition, the macroenvironmental forces that are explained in this report involves- political, social, economic and technological. In the last section, the conclusion has been drawn based the present chocolate market condition in Australia and Donald B potentiality of growth of this chocolate confectionary sector in Australia. Effective market analysis has been the cornerstone of the successful marketing campaign. It refers to the assessment of both the external as well as internal market. It has been opined by West, Ford Ibrahim, (2012) that, market analysis is important for every business as it aids to determine their sales proposition, analyze the target customer and their competitors, drivers of the business growth and so on. It has been found out by some researcher that behavior of customers serve as vital tool for the marketers as it helps them to meet their sales target. Analyzing the consumer behavior helps the marketers design the product or service, set the product price, integrate appropriate promotional campaign and improve their business operations (IBISWorld, 2018). Both micro as well as macro environmental has been considered as one of the vital components of market analysis as it facilitates the researchers identify the different forces that impact the business environment and operations i n producing the product. In Australia, the chocolate market is segmented into different categories including the trends of the industry. However, the market is segmented by its type, age group, category, end user and the distribution channel. Recent evidences reflect that the chocolate industry of Australia has been increasing at high rate over the last few years. As a result, they are facing huge competition from the imported chocolate product that is coming from the other Asian nations. In addition to this, as the population in Australia has been ageing, it creates huge opportunity for the manufacturers to create rising number of confectionary product that provide to the age specific needs (McDonald Wilson, 2016). Furthermore, the increasing growth in this sector has been attributed to rising demand of consumers basically for the premium quality chocolates. Moreover, the overview of this chocolate confectionary market in this nation permits the new players as well as the existing enterprise to attain rapi d insight into their market value, packaging and data regarding distribution channel. The producers in the chocolate producing industry of Australia have been facing changing preferences of customers for over the past few years. Baker (2014) opines that increasing customer concerns about sugar as well as fat in foods have reduced the chocolate as well as confectionary demand for the past five years. As a result, the people of this country choose to move towards rich cocoa content products rather than buying chocolate. Furthermore, the participants in this sector have led to rise in product diversification and introduction of healthier products in order to limit the total number of customers switching to other products. As a result, the demand for high quality goods has increased in this market over the last few years. This in turn enhanced the performance of this chocolate industry. Thus, it is seen that the total revenue of this sector increased by near about 2.2% for the last five years. Segmentation of the market Monedelz international is one of the biggest food producers in Australia. It has the portfolio of some of the iconic brands involving Cadbury Dairy Milk, Pascall, etc. They basically focuses on the four pillars involving- mindful sncaking, safety, community and sustainability. Mars is also one of the leading brands in Australia that supplies high quality chocolate, food and other confectionary products (Wedel Kamakura, 2012). This company relies on five basic principles involving- mutuality, quality, efficiency, responsibility and freedom. Nestle is also one of the leading food and beverage forms in Australia that have near about 2000 brands. They conduct their business based on the principles of honesty, fairness and focusing on the people. In fact, their advertising policy and packaging makes them attain huge popularity in the market. As Donald B is the new entrant in this market, he should analyze these vendors before manufacturing the product. This in turn will help to achieve s uccess in the business. Australia has been one of the largest consumption rates of chocolate in the Asia- Pacific regions. Some of the major players in this industry are Mondelez, Mars, Nestle and so on. Mondelez International is the biggest chocolate company that dominates the chocolate market of Australia with near about 55% of share. The next biggest player that comes after Mondelez is Mars, which holds near about 18% of the market share. Nestle follows these two companies holding the total share of 14%. On the other hand, Lindt accounts for only 7% of the chocolate market in Australia. But this enterprise has been considered as the catalyst behind the present growth in the premium chocolate market of this nation (Wilkinson, 2013). Few success factors of these companies involve- attractive presentation of the product, manufacturing of premium products. The benchmark of these companies involves- cost of sales and total expenditure rate. However, Donald B being the new entrant faces several challenges in t he market especially from these biggest rivalries. It has been found out by the researcher that the chocolate market of Australia will grow at high rate in future owing to increase in total number of players in the market. The latest market trend that has been gaining huge momentum in the chocolate market of Australia is the dark chocolate innovation. For the last few years, the manufacturers of chocolate are bringing about innovations in account of manufacturing processes of chocolate in order to compete with its counterparts and open new streams of revenue. This innovation made by the chocolate producers helps them to attract new customers and retain new ones (Kotler, 2015). Owing to this market trends, the manufacturers of chocolate in Australia chooses to become innovative for adapting with the shifts in the preferences of consumers and counteract with these trends. For this the confectionary market in Australia has seen increase in diversification of products, sustainable production, premium chocolate and healthier options of product. Furthermore, increase in total demand for the premium products leads to huge growth in revenue. Overall, the confectionary market trends in Australia have seen an up ward trend over the last few years. Donald B being the new manufacturers in the market faces this challenge and thus focuses on innovating new products in order to sustain in the competitive business environment. Buyers behavior refers to the acts and decision process of the individuals that are involved in purchasing and utilization of products (Rani, 2014). The company operating in the competitive business environment analyzes the behavior of the consumers because of few reasons- Reactions of the buyers to the companys marketing strategy have huge affect on their success. Marketers of the industry predicts how their customers responds to their marketing strategies The marketing theories stresses that the company must create the marketing mix in order to analyze the buying patterns of the customers. The types of customers buying behavior are basically determined by- Involvement level in their purchase decision Customers involvement level also helps to determine the reason behind their interest in seeking information about the goods Influences Definition Characteristics of consumers of fast food and/or low calorie food Social Class ( middle class, upper class and lower class) Cultural factors mainly comprises of set of ideologies as well as values of the specific community or the group of people The consumer that lies in this category consists of both males and females. The customers belonging to social class mainly possess varied buying behaviours. It has been evident from the above study, the Australians consumes chocolates despite knowing the fact it is of high calaroie. Social Influence of the family The requirement and motives of the customers gets influenced by theier family, reference groups, and opinion laeders The consumer falling under this category gets influenced by their family members and other opinion leaders. The individuals sometimes take the decision from their group members. The Australians mainly ask for recommendations from their senior members before buying the chocolates. Opinion leaders They are mainly spokesperson. The markets of the company tries to attract these leaders in order to influence the consumers. Reference groups The group members positively and negatively influences the attitude and behaviour of persons Personal Occupation The individuals occupation has huge affect on their purchasing behaviour Under this factor, the characteristics of consumers of fast food involves- Low income as well as savings of persons purchases cheap products. Thus m they are strong headed Aggression and dominance influences the buying patterns of customers Economic situation The income as well as savings of the customers influences their buying behavior Personality As personality of the individuals varies during the time, it also influences their purchasing behaviour Psychological Perception There are various perceptual procedure , which involves- selective distortion, selective retention and selective distortion. High level of motivation positively influences the purchasing pattern of consumers They are more focused on beliefs and learning Strong attitude of persons enhances their purchasing power Beliefs and Attitudes The beliefs and attitudes of the individuals towards various products influences the customers buying pattern Microenvironment These are the factors in the companys immediate operations areas that impact their performance as well as decision making freedom. These factors mainly involve customers, suppliers, producers, competitors and publics. However, these forces are mainly internal to the companies. Both suppliers as well as producers plays huge role in the success of business. Producers mainly rely on the suppliers for transporting the goods to the customers. In order to operate in profitable manner, the manufacturers and suppliers provides good value to their consumers (scott, 2018). As Donald B is the new player in this sector, they must use whole sellers for distributing their chocolate in the Australian market. The image of the firm mainly decides the future of the market. Brands having good image in the market become successful in attracting their customers. Publics are basically the environmentalists, media persons, consumer protection groups, investors, shareholders etc who have direct contact with the company. The firm that gives their energy to manage their relationships with these publics helps them to achieve success in the business. However, their success in the market affects these people viewpoint in their activities. However, in the modern world, pubic plays vital role in microenviroment of business. The competition level in the industry has huge impact on the profit of the business. The larger the total number of rivalries, the lower is their market share. In addition, the competition pressure also compels the enterprise to update their activities as well as marketing strategies (Fleisher Bensoussan, 2015) Sometimes, competition also acts as positive factor and thus can aid churn demand. Competitor Overview of their competing offerings Target market Positioning Mondelez Premium products is one if the offerings that this company is pushing. They also increases their healthier offerings of product Their target market is mainly the emerging markets. They reinvests their profits in these markets in order to grow their business Mondelez has the leading position in the market with near about 37% of the value share. They have positioned itself as the producer of premium product brand. Mars Their competitive offerings are mainly based on production capacity, packaging designs, pricing of different packs, celebrity endorsements etc. Their main target market is the health conscious individuals and the children. Moreover, they products manufactured by them are mainly based on the preference of customers Mars has well position in the Australian chocolate market. It is the second largest manufacturer of chocolate in Australia with near about 18% share in the market. In fact, they produces their chocolate from the certified sources (Tudor Negricea,2012). Lindt The product offerings are suitable for the individuals with lactose intolerance. In fact, their chocolate products are mainly suitable for the vegetarians Their target customers are the age group of 25-30 years. They have well defined target customers to whom they offer products. These are the customers that spends more than average on high quality product. Lindt is nit well positioned in the Australian market as it accounts for about 7% of the market share. Products of Woolsworth Their competitive offerings lies in the low price offerings of the product Their target market involves- low income and price sensitive individuals. It has good position in the Australian chocolate market. Macroenvironment The macroenvironment forces consist of those forces that impact the economy and nit just particular segments. These forces involve- demographics, technological, cultural, economic and political factors. Macro Factor/Trend Definition of Factor Explanation of trends / events relevant to fast food or low calorie food Demographic Various market segments are affected by demographic forces involving ethnicity, age, household lifestyle etc. As the lifestyle of Australian are high, the people living in this nation do not hesitate in buying high priced product. Moreover, the chocolate makers also produce chocolate for all age groups. Economic The economic factors are vital as they impacts the spending and buying patterns of customers. Climatic conditions as well as technological forces affect the firms production and distribution of goods. Australia is considered as the good destination for doing business. But the present climatic conditions increase difficulty for the chocolate producers to manufacture at high rate. On the other hand, advancement in technology in this nation helps the chocolate manufacturer to produce innovative product. Natural The renewal of natural resources including forests, marine products and the non- renewable resources affects the production. There are several renewable an non-renewable resources in this nation, which positively affects the business operations. Technological Technology permits the firms to know the amount of goods they have in their warehouse. It also helps in tracking, marketing and communicating the products. Emerging technologies in this nation helps the chocolate makers to increase their total production. Political Political environment impacts marketing through laws, government agencies etc. Legislation also motivates trade as well as competition in the market. Australia has good political system for tackling challenges and thus he chocolate makers donot face any difficulty in producing products. On the contrary, increased regulation as well as legislation puts this industry under huge strain. Cultural These factors refer to customs, culture and change in cultural trend that changes the future of company. The Australian culture is the multicultural society. However, this cultural trends positively affects the chocolate industry in this nation. Conclusions From the above study, it can be concluded that effective marketing strategy is vital for every business especially for the new entrants. Donald B being the new chocolate maker in the industry should focus on buyers behavior, microenvironment and macroenvironment forces. Over the years, there has been rising trend in the chocolate market in Australia. As the Australians become increasingly concerned about sugar as well as fat in foods, it weakened the confectionary demand mainly mass-produced product. Even the chocolate makers of this industry are focusing on producing premium products owing to increase in demand of customers. As a result, the chocolate makers in this nation attain higher revenue and profit from the sale of these products. However, huge competition in this industry puts pressure on Donald B to become more innovative with their range of products. Thus, it is predicted that Donald B has good potential to grow in this nations chocolate confectionary sector. References Aaker, D. A. (2012).Building strong brands. Simon and Schuster. Australia Chocolate Market Size, Share, Analysis Forecast 2023 | TechSci Research. (2018).Techsciresearch.com. Retrieved 27 March 2018, from https://www.techsciresearch.com/report/australia-chocolate-market/1711.html Baker, M. J. (2014).Marketing strategy and management. Palgrave Macmillan. 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