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1. Executive Summary
The written marketing plan provides clearly stated activities that help employees
understand and work toward common goals. Writing a marketing plan allows the
marketing manager to examine the marketing environment in conjunction with the
inner workings of Guinness.
The mission statement is based on a careful analysis of benefits sought by present and
potential customers and an analysis of existing and anticipated environmental conditions.
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Guinness UDV’s long-term vision, embodied in the mission statement, establishes
boundaries for all subsequent decisions, objectives, and strategies. A mission statement
should focus on the market or markets that Guinness UDV is attempting to serve, rather
than on the product or service offered.
In a situation (or SWOT) analysis, Guinness UDV should identify its internal strengths
and weaknesses and also examine external opportunities and threats, marketing
managers must analyze aspects of the marketing environment in a process called
environmental scanning.
Marketing strategy refers to the activities of selecting and describing one or more target
markets and developing and maintaining a marketing mix that will produce mutually
satisfying exchanges with target markets based on Guinness UDV’s competitive
advantage and proposed positioning.
Target market strategy identifies which market segment or segments to focus on. The
process begins with a market opportunity analysis, or MOA, which describes and
estimates the size and sales potential of market segments that are of interest to
Guinness UDV. In addition, an assessment of key competitors in these market segments
is performed. After the market segments are described, one or more may be targeted by
Guinness UDV.
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The marketing mix refers to a unique blend of product, distribution, marketing
communication (promotion) and pricing strategies designed to produce mutually
satisfying exchanges with a target market.
Implementation, evaluation, and control of the marketing plan are necessary. Before a
marketing plan can work, it must be implemented, that is, people must perform the
actions in the plan. The plan should also be evaluated to see if it has achieved its
objectives. Poor implementation can be a major factor in a plan’s failure. Control provides
the mechanisms for evaluating marketing results in the light of the plan’s goals and for
correcting actions that do not help the Guinness reach those goals within budget
guidelines.
2. Introduction
Guinness UDV has engaged our group as marketing consultants for Smirnoff Spin and
we are required to draft a marketing plan ensuring Smirnoff Spins continued success in
the South African ready to drink market. New competitive drinks from rival companies
like Bacardi Breezer, Bacardi Cola, Red Square and Archers Aqua have challenged
Smirnoff Spins strong market share in South Africa. Guinness UDV wishes to increase
their market share in South Africa and eventually penetrate the African and
international markets.
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This report will identify some of the segmentation criteria that will impact the target
market selection. Target consumers have been identified as adults from eighteen to
thirty years of age, that enjoy outdoor activities like going to the beach, concerts,
night clubs, carnivals, and sporting events. Consumers will be influenced by many
factors to buy our product. Price and taste are among these factors, but we think that
the Smirnoff brand name will be the most influential of all. We will use Guinness
UDV’s already established distribution channels, thereby ensuring that consumers
will easily find Smirnoff Spin.
Pricing and promotion are very important parts of the marketing strategies and tactics
of Guinness UDV. Both are part of the marketing mix which is part of the marketing
strategies and action plan of the company. A concerted effort combing pricing and
promotional objectives and strategies should produce profitable results. A generous
markup price will produce the pricing flexibility needed to contend with internal and
external factors throughout the product life cycle. Advertising and promotion
objectives will focus on targeting identified consumers in order to promote our product.
Smirnoff Spins path through the product life cycle has been established. The factors
that will influence its movement have been identified, as well as some of the tactics
that will be used during the different stages.
Differentiation and positioning strategies have been established using the unique
qualities of the product. Using our marketing objectives as a base, a budget was
developed and control mechanisms also established.
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3. Marketing Plan Layout
Marketing Objectives
Competitive Advantage
Positioning strategy
Marketing Strategy
Product Place
Marketing Mix
Promotion Price
Budget
Implementation, Evaluation,
Control
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4. Vision
To be the drink of choice in the “Ready to Drink” market and to optimize our market
share.
5. Mission Statement
To nurture our brand in the local and international market and exceed customer
expectations.
6. Marketing Objectives
The marketing objective for Guinness UDV is to increase Smirnoff Spin’s market share from
12.2% to 15% of the South African market within six months time period. These objectives
were developed using SMART goal setting criteria.
• Specific – The objective should state what is to be achieved.
• Measurable – An objective should be capable of measurement – so
that it is possible to determine whether (or how far) it has been
achieved.
• Achievable – The objective should be realistic given the circumstances
in which it is set and the resources available to the business.
• Relevant – Objectives should be relevant to the people responsible for
achieving them.
• Time bound – Objectives should be set with a time frame in mind.
These deadlines also need to be realistic.
7. SWOT Analysis
7.1 Strengths
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• “Smirnoff Spin has been designed to keep pace with the changing demands
of South Africans consumers, who want and expect change in the ready to drink
market.” Smirnoff Spin is a leader in RTD market because they are aware of what
consumers need and what. Consumers want products that are of good quality, but are
value for money. Consumers also prefer products that make their lifestyle easier, more
convenient and quicker. With Smirnoff Spin creating the RTD category it is quick and
easy to transport to parties etc. Consumers don’t have to stand and pour each ingredient
individually.
• “Unlike many of its RTD competitors, the new drink is aimed at men …”
Guinness UDV’s MD, Gary May is quoted as saying ”Generally, men will not drink
a ‘female’ drink but women will drink a ‘male’ drink. In the past women were more
wine, liqueurs and sherry drinkers, very few actually drank spirits. The RTD
beverages were targeted more at women because the RTD beverages were
packaged in a more feminine and sophisticated way. Guinness UDV intended to
target male consumers thus the introduction of Smirnoff Spin.
• “Its embossed bottle and blue and silver colouring maintains its
sophistication and its clear liquid is closer to its Smirnoff
trademark and pure Vodka heritage.” Consumers are well aware of
the Smirnoff pure Vodka heritage due to the prestige and popularity of
the Smirnoff brand. Smirnoff Spins appearance has the resemblance of
the Smirnoff Vodka trademark and this attracts consumers that are
loyal to the Smirnoff brand.
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• “Smirnoff Spin was developed through extensive research, engaging
customers to help in all elements from the name of the product to the taste.”
Consumer research showed that consumers enjoyed drinking the Smirnoff Spin because
it looked cleaner and more sophisticated. Guinness UDV conducted research and
determined from consumers what they wanted and expected from this new product.
7.2 Weaknesses
• ‘’In its sector, consumers gravitate towards new products for their
novelty and perceived fashion ability in packaging and flavour,
and product lifecycles are short as brands lose consumer
relevance.” Consumers are image conscious so when new products
are launched that are perceived to be sophisticated and trendy, they
will go out and purchase it even if they don’t know anything about that
product. Once they have tried it they will make their decision. Guinness
UDV needs to be constantly aware of the changing market and ensure
that they keep up with the demands and needs of the consumer. If new
products are launched they need to revitalize their products or launch
new ones to keep customers loyal to their products.
7.3 Opportunities
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increase their sales as well as their market share. This is also an
opportunity for Guinness UDV get a competitive advantage as their
competitors target females only with their RTD beverages.
7.4 Threats
• “Smirnoff created the RTD category while others have been piling
into it leading to a lot of clutter (about 12 imitators), which was
slowing down category growth.” Consumers have a huge variety of
drinks to choose from due to the different brands on the market. Loyal
customers will purchase Smirnoff Spin but the majority of consumers
will try different brands when purchasing from the RTD category.
Towards the middle and end of the month, consumers will purchase the
cheaper, more affordable brands. This reduces sales and increases
competition and will result in a decline in market share.
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8. Target Market
The Universal Living Standards Measurement (LSM) is a target-marketing tool that is
used for the selection of appropriate media to reach different target markets. The
classification of people using LSM is an attempt to group similar people together and also
distinguishes between different groups of people in South Africa. The LSM measures
social class, or living standard, regardless of race, income or education. Instead of
approaching social class from the point of view of obvious demographic differences, the
LSM therefore quantifies the ownership of certain durable goods, access to services, and
the like, to yield a composite measure of social class.
There are 10 universal LSM groups ranging from group 10, which has the highest
standard of living, to group 1 with the lowest.
Groups 4 and 5 were selected as target consumers for Smirnoff Spin. These two groups
of people are both rural dwellers and urbanized and are aged from 16 – 30 years and
earn an average of between R2000 – R3000 per month. These consumers like to try
new things, innovate, and challenge the traditional or customary way to do things. They
are people that are energetic, sociable and fun and will be attracted by Smirnoff Spin
because the product contains all the qualities that bring all these types of personalities
together. Consumers for Smirnoff Spin will also like outdoor activities like the beach,
concerts, night clubs, carnivals, and sporting events. The typical consumer profile for
Smirnoff Spin is as follows:
• Primary Target – Males
• Secondary Target – Females
• Age Group – 18 to 30
• Educational Level – High School graduates, College/University students, Young
Professionals
• Characteristics – Sociable, Energetic, Fun Loving and Adventurous
Table 7.1 shows the breakdown of LSM groups 4 and 5
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4 51.2 48.8 4056 000 R1924 1418 000
5 52.2 47.8 3451 000 R2674 1359 000
Table 7.1 (Lamb Jnr, C.W. et al, Marketing Management, Page 48)
9. Positioning
Positioning strategy assumes that consumers compare products on the basis of
important features. Effective positioning requires assessing the positions occupied by
competing products, determining the important dimensions underlying these positions,
and choosing a position in the market where the companies marketing efforts will have
the greatest impact. The main positioning strategy for Smirnoff Spin will be focusing on
the brand name of Smirnoff. The Smirnoff brand is a market leader and has the respect
of consumers around the world for the quality of its products. Smirnoff provides our
product with brand equity or added value beyond the quality of its ingredients. Smirnoff
Spin will like to position itself as a product that can be identified as authentic, exuberant,
real, quality, taste, young, and full flavored with a blend of pure Smirnoff Vodka and a
crisp lemon taste. Some of the characteristics more interested by our target consumers
have been taste, alcohol percentage level, and ingredients. Smirnoff Spin will compete
with other alcoholic ready to drink beverages like Bacardi-Cola, Archers Aqua, Red
Square and Brutal Fruit.
People all around the world know the Smirnoff brand and the trajectory of its products.
The name Smirnoff by itself means quality and consumers give them complete support
when they bring new products to the market. Smirnoff Vodka is the most famous Vodka
in the World (allbusiness.com). Bringing this famous brand into a ready to drink product
will grab the attention of loyal brand consumers to the not so experienced alcohol
drinker, making it their drink of choice. One of the attributes to be used for the Smirnoff
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Spin differentiation strategy on the ready to drink (RTD) market is the fact that Smirnoff
Spin is the only RTD that appeals to males.
Smirnoff Spin will be distributed in two different types of materials; 340 ml glass bottles
and 275 ml metal cans. All alcoholic drinks come in glass bottles to maintain freshness
and taste. The addition of metal can is enable the consumer to have a better grip on the
drink and this can be considered a safety precaution in a nightclub environment. This
can is a world first in terms of its size, and displays an elegance designed for the
sophisticated club beverage market. A totally South African product from raw steel to
inks, used to develop technology, modifications and customizations to achieve the
results. It has strong visual appeal. The use of Ultra Violet inks on some packs creates
startling effects in nightclubs and bars.
The product life cycle concept may apply to a brand or to a category of product. In our
case it can be applied to ready to drink market or Smirnoff Spin itself. Its duration may be
as short as a few months for a fad item or a century or more for product categories such
as Smirnoff Vodka. Smirnoff Spins predecessor, Smirnoff Ice, has already been through
the introductory stage, and the growth stage. The product is currently at the maturity
stage fast reaching the decline stage. Smirnoff Spin has been introduced as a new
innovation for early adaptation and early maturity. The new product will follow the same
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life cycle. When Smirnoff Spin reaches maturity stage, it will be time to introduce a new
product or revitalize current product by rebranding or repackaging it.
With this approach our consumers will be able to gain access to our product through
wholesalers like Makro, bottle stores like Picardi Rebel and Liquor Town, and chain
stores like Spar Tops and Pick n Pay Liquors, and even independent bottle stores in the
neighborhood. This way, our product is readily available to consumers in different buying
categories while keeping up our image of supplying a prestige product. The concept of
direct distribution channel strategy is to increase our products coverage, market
penetration effectiveness while maintaining a control of the distribution and cost.
10.3 Price
Pricing is one of the most important marketing mix decisions due to price being the only
marketing mix variable that generates revenues. Pricing is an important strategic issue
because it is related to product positioning. Furthermore, pricing affects other marketing
mix elements such as product features, channel decisions, and promotion. Pricing is not a
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single concept, but a multidimensional one with different meanings and implications for
the manufacturer, the middleman and the end-customer. Pricing strategy is of great
importance because it affects both revenue and buyer behavior. The whole pricing
environment is therefore considered, first from the point of view of the company and its
strategies and secondly from the aspect of the consumer. However, it must not be
forgotten that there are other, external influences on pricing - not just a firm's competitors
but also from government and legislation. Once these factors have been taken into
account, various pricing strategies are reviewed and some attention is given to how best
to implement those strategies; how pricing levels can be adjusted and how such tactics
do affect buyer behavior and company revenue.
Guinness UDV’s objective for Smirnoff Spin is to expand the market share of its
products, therefore Smirnoff Spins pricing will be focused on a sales-oriented objective.
Due to the strong economic stability Guinness UDV and its parent company, profit is not
an important objective during the introduction phase of this product.
Guinness UDV will use a penetration pricing strategy while the product is in an
introductory phase. The penetration pricing pursues the objective of maximizing sales
by means of a low price. This strategy is ideal due to the demand on this market being
highly elastic. Customers are price sensitive and the quantity demanded will increase
significantly as price declines. As the product lifecycle progresses, there likely will be
changes in the demand curve and costs. As such, the pricing policy should be
reevaluated over time. A pushing strategy will also be used with Smirnoff Spin. Using
promotions, personal testing sales, advertising, and sales promotion effort will help sell
our product through members of our distribution channel.
10.4 Promotion
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part of the success of a product. Promotional approach used for Smirnoff Spin has to
follow the line of the mission, vision, and strategies of Guinness UDV.
An example is to present promotions to the retailers. The retailers will in turn promote
it to consumers. The push strategy will try to sell directly to the consumer. With this
type of strategy, consumer promotions and advertising are the most likely promotional
tools. A pull strategy may be enforced on a later phase of the product life cycle, re-
evaluating our market share. The pull strategy is the one that requires high spending
on advertising and consumer promotion to build up consumer demand for Smirnoff
Spin. If the strategy is successful, consumers will ask their retailers for our product,
the retailers will ask Guinness UDV, thereby creating a demand for the product. The
advertising and promotion objective is to focus on targeting our identified consumer
market and promotion of the product. Some of the promotion strategies that will be
used are:
• Free tasting events in selected pubs, sport clubs, bars and night clubs
throughout South Africa during working days (Monday through Thursday). At
least double the quantity on weekends.
• Television and radio spots during prime-time shows. On television shows like
Isidingo, Survivor, Pop Idols and all sports transmissions will get the attention
of our target market. On radio morning shows like East Coast Radio’s Big
Breakfast Show and sports related shows will also target our selected market.
• Billboard announcements will be placed wherever outdoor activities are held.
• Supply fridges with Smirnoff Spin branding to retailers. Only Smirnoff Spin may be
stocked in these fridges.
• Advertisements in magazines and newspapers that our target market usually
read like FHM, Sports Illustrated and the Sunday Times to name some
examples.
• Web advertising and a special website will also be used to attract attention to
the qualities of our product.
• Sponsorship of sporting events and activities.
• Engage in social and community projects e.g. upgrading sport facilities in
residential areas.
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We will also offer discounts through our distribution chain. Some of the discounts are:
• Quantity discount - offered to customers who purchase in large quantities.
• Promotional discount - a short-term discounted price offered to
stimulate sales.
Before a marketing plan can work, it must be implemented, i.e. people must perform the
actions contained in the plan. The plan should also be evaluated to see if it has achieved
its objectives. Poor implementation can be a major factor in a plan’s failure. Control
provides the mechanisms for evaluating marketing results in the light of the plan’s goals
and for correcting actions that do not help the firm reach those goals within the budget
guidelines.
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A simple control concept would be to compare actual measurements of Guinness
UDV’s market share with past results. There can be different controls with different
objectives depending on the product's position in the product life cycle. It is important to
clearly establish that the different stages of controls in a marketing plan is to make sure
that the company meets sales, revenues or any other goals established by the
company in their marketing plan. As part of the marketing plan, we have established
some control methods for Guinness UDV to monitor Smirnoff Spins performance and
quality. Some of the selected methods are:
• Focal groups - This method permits the use of direct interviews to a group of
consumers at a specific determined time. Focal groups will comprise of consumers that
fit our primary and secondary target profiles. The focal groups will inform us what their
perception is of our product that of the competition.
• Internet surveys – Consumers will be encourages via incentives to answer
internet surveys that will enable us to measure the success of Smirnoff Spin. Only
consumers who fit our target profiles will be requested to answer our survey.
Other controls will include monitoring expenses, sales and revenue reports on a
monthly, quarter, and annual basis. With the help of these methods Guinness UDV will
be able to study the correct perspective of the consumer in relation to the product and
its relationship with the competition, helping the marketing team with decision making
and the market position of Smirnoff Spin.
13. Conclusion
Although there is no set formula for a marketing plan, or a single correct outline,
Guinness UDV need to be aware of the basic factors that should be covered include
stating the business vision and mission, setting objectives, performing a situation
analysis of internal and external environmental forces, identifying a potential competitive
advantage, selecting one or more target markets, deciding on an appropriate positioning
strategy, delineating a marketing mix (product, place, communication/promotion and
price), and establishing ways to implement, evaluate and control the plan. Management
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at Guinness UDV need to realize that strategic planning is an ongoing process and not
an annual exercise. Second, good strategic planning involves a high level of creativity.
Finally, the top management’s support co-operation is required.
The Smirnoff brand behind our project has become the greatest strength or asset for
Smirnoff Spin. The Smirnoff brand will be the main influence into persuading and
consumers to purchase our product. Already established local distribution channels will
be used to distribute Smirnoff Spin to retailers. Guinness UDV’s manufacturing capacity
and raw materials will help Smirnoff Spin to maintain a very low production cost,
therefore allowing it to have a very reasonable price. With an increase in market share
approach, promotional and pricing objectives have produced very interesting strategies.
A push-pull strategy enforced through the distribution channel will help Smirnoff Spin go
through a long life-cycle letting it obtain the market share desired by Guinness UDV in
the Ready to Drink Market.
Smirnoff Spin, the drink with a pure Smirnoff Vodka base and a twist of crisp lemon is
slightly sweet, refreshing and suited to any occasion. Smirnoff Spin is brought to you
by Guinness UDV, the world leader in the Ready to Drink Market.
14. References
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• Reference for Business – [online], www.referenceforbusiness.com
• Slide Share – [online], www.slideshare.net
• Tutor2u – [online], www.tutor2u.net
• All Business – [online], www.allbusiness.com
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