Marketing people

Just a test blog post 4 Ellebanna

2010-03-03T05:23:00.000-08:00

Hola Chicka

This is how a blog can be created.

C? Its live on the web now.

An this link lniks to my website for example.

Sample media plan - Media Plan for Fast Fitness

2009-05-15T03:46:00.000-07:00

Media Plan for Fast Fitness

Table of contents

1, Background to hypothetical plan

2, Media objectives

3, Competitive analysis

3.1, Budgets

3.2, Media selection

3.3, Timing of media delivery

4, Target audience analysis and recommendation

5, Media habits of the target audience

6, Media selection rationale

6.1, Creative media options

7, Media strategy

8, Flowchart and budget

1, Background to hypothetical plan

Fast Fitness is a personal-training focused company, operating in three locations in Sydney since 2002. It is positioning itself between the large gyms and the personal trainers’ services. Sessions are held in small groups with personalised workout plans, for the average price of $80 for average 3 occasions per week, which is highly competitive with personal trainer’s $80/hr.

FF is hiring an advertising agency to create an effective media plan to support the marketing plan, which objective is to change the market share from 2,12% to 2,52% of its local market. The company has told the agency to assume a total advertising budget of $100000 and asked for a media plan. The account group says the creative department is working on page-four/ color magazine ads, car stickers and a YouTube video and other computer applications.

2, Media objectives

Fast Fitness wishes to advertise all year around, and also to heavy up one month before those months when the sales was lower in the past years (school year beginning month, December, January and February). The goal is to use the present facilities maximum effectively, without the need to purchase new location in the following year.

During the heavy up periods the company wants to reach the 70 percent of target customers an average of 4 times, and 35% 5 or more times. The all year around average reach should be 40% at least once a month in the local target area. Utilize various media which is able to show how simple the exercises are, what a beautiful body shape can be reached, how much weight can be lost in 3 months and how much someone can save in a year compare to attend to personal trainers.

3, Competitive analysis

The aim of this section 3 is to give an overview about the media usage of the competitors in the previous year, so the media planner have the resource and knowledge to come up with the best plan possible to make of the budget what is most effectively supporting the marketing and media objectives.

3.1, Budgets

Exhibit 1 shows how much the main competitors spent last year for advertising in various media.

Exhibit 1.
Competitor Companyes of Fast Fitness	Market shares %	Total annual expenditures $
URCoach	20	800000
Executive Fitness	11	400000
Coaching Pro	6	150000
Individual personal trainers (144 businesses)	60	2000000

3.2, Media selection

The amounts that competitors spent are only part of the story. From exhibit 2 the planner can find out how the competitors used their dollars. The data indicates that most of the money was spent in colour monthly magazines (women 31%, man 16,5%). The last column shows the average % spending in the various media types.

Exhibit 2.
	spendings in %
	URCoach	Executive Fitness	Coaching Pro	Individual personal trainers (144 businesses)	Average spend %
Men magazines	22	14	0	30	16,5
Women magazines	23	31	40	30	31
TV	10	23	4	10	11,75
Merchandise	11	3	31	10	13,75
Travel competition	5	2	10	0	4,25
Website	14	10	0	10	8,5
Radio show sponsor	5	3	7	0	3,75
Billboards	10	14	8	10	10,5
Total	100	100	100	100	100

3.3, Timing of media delivery

As in the whole business life, timing is critical also for the media planning. The attendance in the gyms usually follows a bit the seasons, regarding that when the weather is cold, people wish to exercise indoor, but when the weather is fine from August to April people tend to choose outdoor sporting activity. The beginning of school year, the times around Christmas and the usual summer holydays has a negative effect on the gym membership numbers also, regarding that everyone has extra spending and less time. Exhibit 3 shows timing of competitors’ spending. Normally it is worth to advertise harder when there is bigger demand, but in case of Fast Fitness next year circumstances, that there is only limited capacity left in the peak times and bigger in the off peaks, the media planner will be requested to focus on the free resources.

4, Target audience analysis and recommendation

Fast Fitness is focusing on the 35-50 age group, both man and woman. Fast fitness thinks that its best prospects are mature people, who have limited income, so they tend to choose cheaper personalised group sessions than more expensive personal trainers, but as they feel overweighted and not confident about themselves and the fitness practice, they still have a demand on personalised exercise plan. More details about target audience in Exhibit 4. , based on surveys by Fast Fitness.

Exhibit 4
Demographics	Geographics	Psischographics	Behaviour
90% between 38-50 years old	80% Sydney	like fit persons	eat chocolate every 2-3 days
56% male	10% Wollongong	like good looking persons	drink 2 beers every 4 days
44% female	10% other <50km	they trust magazine ads most	buy nutrition magazines monthly
average income less than $50000 / year		they trust famous sport stars	buy healthy life magazines monthly

To determine how many these people are, and how many of them are planning to do fitness the next year, the media company working on this media plan had to buy data from the Mediamark Research Inc. Australia. The result for how many 35-50 years old people in Sydney wants to do fitness for at least one month next year is 7% of Sydney’s population.

5, Media habits of the target audience

MRI Australia also tells planners which television programs regular fitness people watch. Exhibit 5 illustrates the concept of media selectivity. Composition represents the percent of the target age group, who wants to have gym membership next year. Although it is only 7% of the total Sydney population, it is much more percent of the viewer’s of the fitness programmes.

Exhibit 5
		People who want gym membership next year
	Adults nr.	number	%	index
Total adults Sydney	4000000	280000	7	100

Morning Fitness Ten	70000	39200	56	800
Afternoon Fitness Nine	60000	33000	55	786
Fitness world champ	66000	29700	45	643
Fitness Australia	58000	37700	65	929
Australia Fitness Idol	72000	40320	56	800
Biggest Loser	73000	48180	66	943
Fit and Strong	67000	38190	57	814

The media behaviour analysis continues in Exhibit 6 by showing average people’s selectivity to other sports programs on TV with fitness mindset. These analysis show which programs have concentrations of the target audience, and guide the planner in selecting the best media to reach them.

Exhibit 6
		People who want gym membership next year
	Adults nr.	number	%	index
Total adults Sydney	4000000	280000	7	100

Football games	350000	56000	16	229
Tennis	300000	45000	15	214
F1	330000	46200	14	200
Basketball	290000	37700	13	186
Beach volleybal	360000	43200	12	171
Horse racing	365000	40150	11	157
Surfing	335000	33500	10	143

Same concept applies to “body builders” readership of magazines. Readers of Fitness World are 371% more likely to have at least one month fitness gym membership than the average people from the target age group.

Another important thing beside composition is coverage, which is the percent of the target that reads a magazine. For example we can say that Man Fitness is covers 19,64% of yearly once gym membership holders (55000 readers / 280000 yearly membership holders * 100 = 19,64).

Cost effectiveness is usually evaluated by the Cost Per T(M)housand number, which shows how much does it cost to reach 1000 people of the target audience through a magazine. If an ad cost $2000 in Woman fitness for the Sydney area, and there are 45000 readers who do fitness once a year, than 2000/45000/1000= $44,44.

All data in detail for magazines are shown in Exhibit 7.

Exhibit 7	All numbers and % is valid for the Sydney area only
	Audience nr.	Comp %	coverage %	index	cost $	CPM $
Nr of fitness members yearly once	280000	7	100	100

Man Fitness	55000	43	19,64	614	2200	40,00
Woman Fitness	45000	42	16,07	600	2000	44,44
Fitness world	65000	33	23,21	471	2100	32,31
Fit Fitness	20000	60	7,14	857	1800	90,00
Personal Fitness	14000	80	5,00	1143	2341	167,21
Natural Fitness	46000	34	16,43	486	1567	34,07
National Geographics	80000	5	28,57	71	4321	54,01
Life	60000	9	21,43	129	1234	20,57
People	34000	13	12,14	186	1678	49,35
Cars	100000	4	35,71	57	2222	22,22

6, Media selection rationale

For the next year there are tree media vehicles sel ected to deliver the advertising messages.

a) There will be all year round a full A4 colour page bought in the middle of Fitness World Magazine. This magazine was selected for a few reasons. First of all, this magazine is only published in Sydney, and therefore it is tailored as much as possible for the local particularity. Secondly it has the cheapest CPM in the range of the investigated papers, $32,31 / 1000 people of the target audience. The Fit Fitness, Personal Fitness magazines are too expensive, the Man Fitness and Woman Fitness is too selective. Natural Fitness would be highly competitive, but has less target audience readers and last year there were communication problems between the two company’s management.

b) The second selected vehicle is billboard advertising in the neighbourhood of Fast Fitness locations. This vehicle is supposed to support the heavy up advertising periods, as it is easy to schedule in time.

c) The website of the company. This vehicle is selected, because it is directly controlled by the company, can be refreshed daily, has low cost after once it is already running, can contain various multimedia.

6.1, Creative media options

a) Cooperate with Australia Home Made Chocolate Inc. chocolate manufacturer, and introduce the “Crunchi Funchi Fitness Bar” with the following slogan on it – “Our chocolate tastes better than ever, and tells you how many exercises to do to use its energy in a fun way, so you stay as slim and healthy as you were before! To learn more about food and contained energy, visit Fast Fitness. Do fitness as fast as eat a chocolate bar.”

b) Distribute free stickers for cars: “Follow me, I am driving to Fast Fitness – sooner or later : )))”

c) Distribute free glasses and fridge magnets: “I love myself, I mind my health”

7, Media strategy

TV advertisements will not be applied, since they are more difficult to target geographically and they are very expensive.

Target 35-50 years old limited income people, with the demand of personal training, but not personal trainer.

The main page of the website will distribute first of all the value offer with the prices, locations, discounts offered etc. There will be a free sample fitness plan, a request form for a personal fitness plan for some price, and an automated virtual trainer, “who” will always communicate the elements of the personalised training plan, while also showing the correct movements required. Free screensavers, fitness theme e-postcards and desktop backgrounds will be downloadable. Present vouchers advertised for 5% off will be also offered.

Use the Fitness World magazine and the website for the continuous advertising and awareness maintenance, and use the billboard advertising for the heavy up periods.

Details shown in next chapter Exhibit 8.

8, Flowchart and budget

Exhibit 8 summarises the action elements of the media plan.

Exhibit 8
	*Fast Fitness next year media plan*
	Jan	Feb	Mar	Apr	Maj	Jun	Jul	Aug	Sep	Okt	Nov	Dec	Cost $

Fitness World
Reach %	65000/(280000/100)=23,21
avg frequency	3
cost $	2100	2100	2100	2100	2100	2100	2100	2100	2100	2100	2100	2100	25200

Website													50000

Billboards
Reach %	13	14						13	14	15	16	14
avg frequency	10	10						10	10	10	10	10
cost $	3500	3500						3500	3500	3500	3500	3500	24500

TOTAL													*99700*

Out door advertising, transit media, share of voice, typical media strategies

2009-05-15T03:43:00.000-07:00

1. Explain the uses and limitation out door advertising.

Uses: Used for local markets, good for wide local coverage if displayed at a busy location. High frequency can be reached, if u put it to the highway for a month, everyone who goes to work and back home daily can see it 40 times. As these are the largest vehicles, huge prints are available. They are flexible geographically, and 24 hrs /day visibility.

Limitation: Can be only a simple picture or a short text, so only simple message can be put on it. Has low recall, but high cost. As they take up big space, there is limited availability of best locations.

2. What is transit media?

Transit media is all the media what can be experienced at public transport locations and vehicles inside and out.

3. Explain share of voice and give an example.

It is a number in %, what tells the spending in % compare to the whole category spending.

Example:

CocaCola spent 20 Million USD in 2008 in the media, and all the others in the soft drink industry spent also 20 M USD,

than SOV of CocaCola is 50%.

4. Name three types of typical media strategies and explain each.

· Flighting

Choose advertising periods, when your brand can be prominent to competitor’s brands. In this strategy we use additional frequency for a short period of time, because we have the assumption that it will be more effective. This means concentrated advertising for about 4-6 weeks. The effect of this strategy is, that money is available to be spent during the bursts.

· Scheduling

When the market brand seems flat during the entire year. This strategy ignores the competition. The net effect of even spending is to have lower reach and frequency.

For example the basic food market, bread, milk etc.

· Heavy-up scheduling

When planners spend more on advertising when consumer buying is heaviest and spend less at other times.

For example electric equipments market before Christmast.

MRI, ABC, BPA, designated marketing area, effective reach

2009-05-15T03:41:00.001-07:00

1. Explain the terms MRI, ABC, BPA.

MRI: Mediamark Research Inc is one of the most widely used syndicated research service. They provide marketing and also media data on a regular basis. They report how often products and brands are used, so that a planner can identify heavy, medium, and light users demographically. MRI provides audience information by age, gender, and household income for all measured magazines as well as cable networks and top websites in exchange for no-charge registration.

ABC: The Audit Bureau of Circulations verifies the circulation statements made by major consumer magazines and newspapers. Although the audit data are password protected, the site contains information about how to use the various reports.

BPA: Business Press Audits. Their service is similar to ABC, but deals primarily with controlled circulation publications – magazines and newspapers that are subsidized entirely by advertising and offered at no cost to the reader. By using the BPA, advertisers can select the publications that most directly reach their particular marketing target

2. Explain the meaning of designated marketing area.

The designated market area, used by Nielsen Media Research for a television market, identifies an exclusive geographic area of counties in which the home market television stations hold a dominance of total hours viewed. There are 210 DMAs in the United States.

3. Explain effective reach.

Once an effective-frequency level has been decided on, the planner needs to know effective reach – that is, the % of the target audience exposed at the frequency level that is effective in the planner’s judgment. If the planner thinks three exposures are enough to be effective, then the plan will need to show what percent of the target is exposed at this level. Typically, a planner wants to reach as many people at this level as much possible within the authorized budget.

How media vehicles are measured, Gross Rating Points

2009-05-15T03:38:00.000-07:00

1. Explain how media vehicles are measured.

In average we can say, that all measurement systems for the different media vehicles are similar from one viewpoint. It is, that most of them are using small group of measured data, and than it is used to find out the most accurate result for the whole audience. Sample size vary from hundreds to tenhundreds.

Television: Measuring companies such as AP Nielsen are selecting a sample group, and ask them to use an extra equipment while they are watching TV. This set top box is than capturing as much as possible data, like what channel is watched by which member of the family, when do they change programmes, which ads are they watching or when do they skip away from an ad to any other channel.

Radio: Radio stations or separate measurement companies distribute a “Radio Diary”, and ask the selected amount of people, or everybody who purchases the diary to fill in the various data, like what time what programme do they listen, which ads do they love or hate, music they love or not, etc.

Magazines and newspapers:

· Recent reading: An interviewer shows a set of magazines one after the other to the sample persons, and ask if they have read the particular paper in the selected past period of time.

· Frequency of reading: Same as above with the difference, that the interviewer is not asking only if someone have read the magazine, but also is asking that how many different issues of it (for example, if a magazine is weekly, than we can ask, that how many weeks did someone see it in the last 4 weeks).

· Yesterday reading: An interviewer is asking the sample group about the few popular local newspapers to find out how many of a set of people is reading which.

Internet: Wide variety set of data is measured by companies like Nielsen or Alexa, through specific add on softwares.

Out-of-Home (billboards, road vehicles, sandwich-mans): Measurement can be done most of times via traffic measurements.

2. Compare reach and frequency.

Reach: is a number, which shows that how many individual (different) people saw an ad at least once, in a defined relevant period of time. One people is counted only once, so in case we display it in percentage, the maximum can be 100% .

Frequency: is a nr. which shows that how many times people see an ad in a defined relevant period of time. But not a cumulated number (all people each time), but the average nr. for how many times each people see the ad. In formula: “Frequency = total duplicated audience/Reach”.

3. Explain GRP and give an example.

GRP = Gross Rating Points

GRP = Frequency (average nr.) * Reach (measured in %) = all together how many times was an ad seen by everyone who have seen it once or more times.

Must be measured for a specific time interval. It is used to demonstrate “message weight”.

Example:

One same tire ad appearing in Ferrari magazine and Porsche magazine:

Ferrari magazine target reach of rubber burners: 25%

Nr of ads in Ferrari magazine: 10

Porsche magazine target reach of rubber burners: 50%

Nr of ads in Porsche magazine: 2

GRP= 25*10 + 50*2 = 350

Situation analysis, media types

2009-05-15T03:37:00.000-07:00

1. Explain the purpose of situation analysis and detail the factors that make up this analysis.

The purpose of situation analysis is to understand the current and past marketing situation, goals and objectives, results and failures. To set up a clear view of the marketing and the media situation about a product or product line for our own company and the competitors. To create a good starting point for the marketing strategic plan.

The factors that make up this analysis:

· History of the market: Need to define the market first both in time and geographically what we will talk about. Gather data and analyse that in terms of like how big was this market in specified years, how did it change or not in terms of market area (like new countries got involved for sales), and also in financial terms: sales, profit, costs, losses etc. Need to do the same analysis not only for the whole market, but devided down into the main competitors and our company level.

· Distribution channels and practices: Analyse that on which channels goes the product from the factory to the costumers. In what kind of packages can it be sourced by the customer, at what location (special shops, supermarkets, malls, order online, need to be a member somewhere etc.), on what price (depending on packaging quality, purchased amounts, source locations, delivery types). Do the analysis both for competitors and ourselves.

· Analyse the targeted costumers of the product, by: demographics (age, sex, income, occupation or any social or economical characteristics), geographic (sales patterns at sales locations), psychographics (in terms of attitudes, interest, lifestyles – such as what they like to do, what they trust etc), and behaviour (activities what the costumers may do, and as these activities affect the sales – i.e. people wear different cloths of a brand for sports and weddings).

· Advertising and media analysis: Research and analyse the various spending for various media types and vehicles and the timings for our and the competitor’s companies.

· Product or service history

· Pricing tactics

2. Explain what factors are considered in choosing media types.

Media types: a class of information channels: radio, TV, newspapers, magazines, interned, public transport vehicles, buildings (printed or light effects), special displays (around soccer ground), sport tracks (like as in ice hockey).

The goal of media planning is to identify the appropriate media types and vehicles, which we think is going to deliver us the expected result of reach and frequency, so through that the company can achieve its marketing objectives.

I assume, that all the factors can be analysed during media type selection, what can have any impact on the result, but it is important to define the requested level of result, so the task can be completed with the smallest effort with the highest efficiency within the budget.

Factors to consider:

· Target audience selection

· Target audience media habits

· Target market, and possible media choices

· Marketing objectives

· Media objectives

· Media timing with its reasons

· The whole media strategy

· Budget, spending, details of costs

· Necessary reach and frequency

· The result of situation analysis

· Measurability of various media

· Alternatives, replacement solution in case of emergencies

Reach, frequency, coverage, target audience

2009-05-15T03:33:00.000-07:00

1. Define each of the reach, frequency, coverage, target audience, media strategy and media objectives.

Reach: It is a number, which shows that how many individual (different) people saw an ad at least once, in a defined relevant period of time. One people is counted only once, so in case we display it in percentage, the maximum can be 100% . (In case of websites, it is the same as “number of unique visitors” if I am right.)

Frequency: It is a nr. which shows that how many times people see an ad in a defined relevant period of time. But not a cumulated number (all people each time), but the average nr. for how many times each people see the ad. In formula: “Frequency = total duplicated audience/Reach”.

Coverage: It is a percentage, which shows that what percentage of the target audience is reached by a media (one magazine, one TV programme etc.). For example, if there is a Ferrari magazine, and 1000 people is reading that, but there are 2000 Ferrari enthusiast on earth, than the coverage is 1000/2000*100= 50%

Target audience: It is a group of people, a selected segment of everyone. Selection is needed to put effort only in those ads, which are going to reach only those people, who are potential costumers of the marketed products or services. Segmentation can be done by: age, sex, occupation, income, media consumption habits or educational levels etc..

Media strategy: This has to be done before a media plan implementation can be started. Media strategy is planned after we overlooked the media objectives. A strategy is a selected set of actions, which are considered to be the best actions to reach the objectives. Contains: which media to use, which vehicles to use, timing of ads etc.. This is a “how needs to be done”.

Media objectives: Media planners can start defining media objectives, after the marketing strategy plan is in their hands. Media objectives and goals are the set of important things, what most help an ad to reach the marketing goals. Media objectives include: determine the target audience based on the target market, determine the needed reach and frequency to achieve marketing goals, determine what kind of media to use. This is a “what needs to be done”.

2. Detail the content of a media plan.

A media plan is a summarised 10-15 mins long presentation of a bigger behind the scenes research and planning. It contains the details of “how the ad will work” and “why this strategy and implementation was chosen”.

In details the minimum elements must include:

· Target audience analysis and selection

· Target audience media habits analysis

· Media objectives

· Media and vehicle selection, timing with its reasons

· Media strategy

· Budget, spending

· Reach and frequency

For the specific cases, a media plan might need to contain the followings:

· CPM analysis

· Seasonality

· Details of broadcasting costs

· Not recommended actions with reasons (media selection, spending)

· Alternative plans in for scheduling and/or budget

· All what can be an issue based on previous discussions with the client

Fast Fitness Marketing Audit of 2005 - a sample marketing plan

2009-05-15T03:31:00.001-07:00

Fast Fitness Marketing Audit of 2005

Table of content:

I. Objectives of the Fast Fitness Marketing Audit

II. Environment

II/a. External Environment

A. Macro-environment

- Economic

- Political/Legal

- Social/Cultural

- Technological

B. Task Environment

- Distribution systems

- Support systems

C. Market Environment

- Markets

- Target segments

- Competitors

- Five force analysis

D. Publics Environment

II/b. Internal Environment

E. Marketing Strategy audit

- Business mission/vision/goals

- Marketing objectives and goals

- Strategy

F. Marketing organisation Audit

G. Marketing System Audit

H. Marketing Productivity Audit

J. Conclusion/Recommendation

I. Objectives of the Fast Fitness Marketing Audit

The objective of this present Marketing Audit is to gather systematically all the comprehensive business relevant data of Fast Fitness’s environment, objectives, strategies and activities. The Audit’s goal is to determine problem areas and opportunities and to recommend a plan of action to improve the company’s marketing performance. As this audit is done at the firs quarter of 2006, here we check the last year(s) accomplishments, and double check of the 2006 plan details.

II. Environment

II/a. External Environment

A. Macro-environment

- Economic

Since 2002 by 2005 the global economic climate was quite well performing, slowly but steadily growing. Australia appears in some statistics as the world’s 3^rd best performing economy, so it is reasonable to expect that fitness is a good business opportunity here, as even average people can afford to spend on their own health.

- Political/Legal

Phil Murray gained personal training qualifications through the Australian Council of Health and Physical Education and Recreation organisation. Thanks to this the company has a legal basis for operating, and is belonging under the law organisation protecting fitness providers against unreasonable civil lawsuits. Therefore there hasn’t been any serious complaint in past years, and there is no action required at the moment, unless some environmental changes don’t indicate that.

- Social/Cultural

Healthy mindset is becoming more popular between all the various aged people, more and more fitness opportunities are required year to year. The “Fat Nations” want to loose their unhealthy fat stocks these days. Because of today sport is not only for the young generations, Fast Fitness is utilising smart on a new target market.

- Technological

Since fitness is on the scene since decades, there are all the best exercising equipments, food on supplements and vitamins already the market, and Fast Fitness has the resources to get all the newest tools in work for the personal trainings.

B. Task Environment

- Distribution systems

There is some missing information in the marketing plan about the distribution channels, since we know that we have 4 good locations with parking available, but we don’t know how many members can be served maximum by each location, and we don’t know if we exceed it in 2006 or not. Immediate data is needed about that, and should be included in the plan the next facility extension date.

- Support systems

Should include details in the marketing plan, and monitor continuously, if Fast Fitness is owning the 4 facilities or renting them, what is their financial cost per month, what changes can be expected (changes in ownership or rental circumstances), and if there is any plan to manage these questions or not. Need to be defined as soon as possible.

C. Market Environment

- Markets

In Australia the fitness industry memberships were grown from 702000 to 969000 by yearly 6% to 15% during 2002 to 2005. For Sydney North and South where Fast Fitness is operating it meant $46M-$64M in sales. Based on these, the planned 2,52% market share increase and the 498 memberships resulting $514727 net operating profit seems to be a realistic goal.

- Target segments

I didn’t find much about surveys and customer satisfaction related data, so I suggest making effective steps to get some information about average customer opinion and suggestion about the prices and services. It is not top urgent, since the company is operating profitably, but can happen that a few simple changes in operations or pricing would result in doubled membership accounts.

- Competitors

Competitors of Fast Fitness can be divided into 3 major groups:

- large gyms with 30% market share in business numbers (much bigger in member’s %)

- personal fitness with 20% share in business nr.

- personal trainers with 50% share in business nr.

These and further analysis through Figure1-2, and Table 2 in the 2005 marketing plan is giving good enough details to get ourselves positioned in the marketplace and have reasonable findings for the following year.

- Five force analysis

The threat of a new competitor enters the market is not significant, as there is 330 businesses already, although have to have a plan how to react, if the new provider becomes a main competitor, of which there are only 3 at the moment.

If we count the 60% of personal trainer businesses into the rivalry competitors group, than the intensity of “fight” is more than measurable.

Regarding that there are many substitute products, Fast Fitness has to prepare to broaden its services spectrum.

D. Publics Environment

As in the SWOT analysis part of the marketing plan it is mentioned as an opportunity, there is a need for nutritional and dietary solutions from customers side, so the website development mentioned elsewhere has to include this part, as an important tool to keep the general public informed. Dietary advices sponsored by Fast Fitness also should have already appeared in local fitness magazines, so corrective steps and responsible persons must be addressed.

II/b. Internal Environment

E. Marketing Strategy audit

- Business mission/vision/goals

Regarding that the business is relatively small as an organisation, Phil can easily talk to anyone and deliver the business mission, what was developed by himself. As a good manager he is continuously maintaining his business vision and delivering to all employees.

- Marketing objectives and goals

All the marketing and the financial goals are clearly stated, no modifications are needed, just need to follow the path.

-Strategy

Clear as crystal, action plan is monthly detailed and arranged. Good job have been done here.

F. Marketing organisation Audit

Founder and main coach is Phil Murray. Business operation started in year 2000. Before Fast Fitness was lunched, he was working as a personal trainer, and in the meantime he developed strong marketing knowledge and business skills. Still he is writing the marketing plans with a good result. For a while this simple marketing organisation is good enough, change will needed later if business grows over a simple handle able size.

G. Marketing System Audit

- Marketing information system

The marketing intelligent system is producing accurate and sufficient information about developments in the marketplace, manager’s eyes are kept on new areas of fitness – like Cardio Yoga – and are under investigation if to build in the value offer or not. Decision date is suggested to have.

- Marketing-planning system

Sales forecasting and market-potential measurement was effective in previous years, work has to be maintained at same intensity for continuous evaluation and adjustment.

- Marketing control system

Although the 2006 plan is detailed well month by month, I didn’t find any control part in the plan which should clearly define who, when and how will check if the monthly plans were fulfilled correctly or not. Have to update the 2006 plan with these information.

- New product development system

The manager and the trainers are responsible to monitor the overall national and international trends, competitors and customer needs, so they have to sit and put on paper all new product development ideas every quarter.

H. Marketing Productivity Audit

Marketing expenditure was planned to be the 1.6-3.9% of revenue, following the competitor’s best practices. There wasn’t any excessive expenditures, the profitability was as planned, so everything seems to be fine if this practice will be continued, although if there are plenty of resources, it would worth a test if higher marketing spending would bring more advantage or not.

I. Marketing Mix Audit

- 7 Ps

Place: The company is operating in 3 locations across Sydney, near to Northern and Southern beaches. Focus remains on these areas for 2006. A survey should be taken to find out how much are the customers satisfied with current locations, or what could they imagine to suit more their demand.

Product: More personalised training than large companies, where people has to develop their own trainings. Phone booking and decision about location is not necessary, gyms are at good locations. The product seems to be competitive as the business manages growing since many years, but other exercise elements should be tested to find out what supporting services would bring higher customer satisfaction and value.

Price: Below the average personal trainers, around 80 AUD / week (it means usually 3 sessions, GST is included in price). This price is very friendly, compare to personal trainers, who charge 65-90 AUD/ hour. A test marketing campaign is suggested to find out if the market would accept a higher price for the same service (maybe in a survey form, not for the current, but for potential customers), so profitability might be improved.

Distribution: Analysing the yearly membership growth rate, it seems that Fast Fitness is still in the Growth Phase of the product life cycle figure, but sooner or later because of the limited number of people on the current area there will be the maturity phase reached. It is suggested to have expectations for that when is it going to happen, and produce in advance the necessary funding and plans to be prepared when further growth can be only achieved by opening gyms at new locations.

Promotion: The open days at every week seems to be a good promotion idea. It has almost zero extra cost, as the lessons are held anyway for current members, but has a new customer attracting potential. However it still means some extra effort from instructors side, so has to be regularly checked if this really has the effect of getting new customers in a profitably way. Also has to carefully analyse the cost benefit relation for all the actions during each months plan, and have notes available if something was worth to do or not, or what modifications are recommended (for example website campaigns etc.)

Sales Analysis: The year 2005 was closed with a good 370932$ net operating profit, but regarding that it was smaller than the previous two year’s, the 2006 plan looks a bit over estimated with its 514727$. Check that what actions are thought to cause this huge extra estimated profit, and check every month the numbers, otherwise expectations might be false and never reached, causing a disappointment and financial problems about planning something to do with the money, what is not sure that will be achieved.

Cash flow projection: moreover what was mentioned in the previous paragraph, Fast Fitness needs to check the relationships with its present financial provider, have expectations about the external financial environment, and maybe apply a financial planner expert, who could also give advices about investments, or to switching for other financial providers for some extra benefits.

J. Conclusion/Recommendation

In conclusion we can say that most of the objectives, strategies and activities are well maintained and regularly checked at Fast Fitness, therefore the profitable operation is well grounded. However there are some missing elements from the plans and activities, so “who when what how” needs to be addressed as soon as possible to carry out satisfying actions to fix those shortcomings. Maintaining quarterly audits seems to be a good procedure to keep the company on the track of improvement.