Topic 3 Marketing

Part 1 Nature and Role of Markets and Marketing

Part 2 Elements of a Marketing Plan

Part 3 Marketing Research Process

Part 4 Customer and Buyer Behaviour

Part 5 Developing Marketing Strategies

Part 6 Ethical and Legal Aspects
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Case Study Manta Surf Products

 

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http://hsc.csu.edu.au/business_studies/marketing/marketing/marketing.html

HSC on line section on Marketing . Overview of the marketing mix and introduction to marketing.

http://www.volition.com/market.html

This is a marketing education site, a portal site with online journals, courses, advertising and marketing research.

http://www.greengrocer.com.au

Open the online retailer site and identify its marketing strategies.

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http://hsc.csu.edu.au/business_studies/marketing/marketing/marketing.html#format

Marketing Plans from HSC Online and a marketing plan format.

http://www.business2business.on.ca/magazine/mar96/b2b_mktg.html

This site looks at the role of the marketing plan, its purpose and its key elements, with the main focus on market research. Marketing plans are an important aspect of business operation, this site allows students to investigate the role of the plan.

NSW Department of State and Regional Development

http://www.smallbiz.nsw.gov.au/frame.cfm?l=/business/managing/links.html&r=/business/managing/market.htm

This NSW Government site for small businesses' provides information on the marketing mix, swot and steps in developing an appropriate marketing plan for your business.

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Plus-one Marketing on-line

These sites are an example of an e-commerce business which specialises in marketing services. It also includes information on market targeting http://www.plusone.com.au/plusone/target.htm
and marketing plans http://www.plusone.com.au/plusone/plans.htm

http://www.roymorgan.com.au

One of the leading marketing researchers is Roy Morgan. Open the site and
identify the sort of research that is undertaken by the leading market researchers.

American Express Marketing Plan
http://www.americanexpress.com/smallbusiness/resources/expanding/mktplan/

This site gives a practical guide for developing a marketing plan. It covers the purpose of a business, the target customer, benefits, positioning, tactics and budget.

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The Role of Marketing in an Organisation Monash University &endash; Faculty of Business and Economics Marketing dictionary http://www.buseco.monash.edu.au/Subjects/MKT/MTPonline/Dictionary/aaa.html

This site provides a marketing dictionary which can be used to define and explain any marketing concept. The dictionary can be used to build a mind map of terms that can be used to understand the topic of marketing.

Two key marketing sites provide information on consumer behaviour. Surveysite allows marketers to asses
consumers response to products an other information. Claritas is a major marketing company. Open the surrvey site and identify how it used to market products.

http://www.claritas.com
http://www.surveysite.com

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Monash University Faculty of Business and Economics
http://www.buseco.monash.edu.au/Subjects/MKT/MTPonline/index.html

This is an excellent site for marketing! The site includes the following topics and provides activities for each topic understanding marketing, marketing's role in the organization, the marketing environment, the marketing information system and marketing research, buyer behaviour, market segmentation, the marketing mix &endash; product, services, price, promotion, place and implementation and control.

Business Review Weekly
http://www.brw.com.au

Open the Business Review Weekly site and locate the news briefs &endash; there have been a number of reports recently on web marketing and the rise and fall of some of the dot.com companies. Examine a report and identify the strengths and weakenesses of web based marekting.

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Australian Securities and Investment Commision
http://www.asic.gov.au

Australiajn Competition and Consumer Commission
http://www.accc.gov.au

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Introduction
Getting Started

Financial
Production
Administration
Sales
Marketing

Maintaining the Business

Financing the business
Administration of the business
Production in the business
Sales in the business
Marketing the business

The Future

Manta Surfing Products is a 16 year old Australian based Manufacturer and Distributor of Bodyboards and Swim Fins with distribution in 20 countries together with a 300 retail store base in the Australian market. The company turnover is under $A10 million made up of 54% International and 46% Domestic sales.

The core Management consists of three working Directors, General Manager, Financial Controller and Factory Manager. Manta is basically a small family styled business with all employees wearing several hats and cross-trained in various roles.

Started by Terry Fleming (Managing Director) the business has evolved from a backyard garage in Lakemba making 10 -20 units weekly to a 48,000 sq. foot factory in Kirrawee manufacturing 1500 Bodyboards per week.

It was not until the early 90's that, after establishing an 'All Year' business and taking on a financial partner that the Management staff was grown to accommodate the almost 20% yearly growth in sales. Until that time all design, materials & engineering and business developments were from Terry's fertile brain and it was he that gave Manta it's unique product and marketing approach, a waterproof core Bodyboard.

Terry saw the potential for an Australian made Bodyboard in a surf market dominated by USA made product, in particular Morey Boogie, then market leader. His original concept was to supplement his income and provide for a growing family. The growth from backyarder to factory grew over many summers due to the seasonality of the business and the lack of International northern summer business in the early years.

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Financial

• Bank: Growth was funded by profits and some small business loans but growing demand added security and personal property was used to secure bank support in an Overdraft and assist the cash flow problems of winter.
  
• Goals: In the early 90's a major goal of getting sales for the Southern Hemisphere winter was achieved. Attending several of the USA Surf Trade Shows found Manta both American and Japanese Distributors and this was a major turning point for the company. Not only did it greatly lift the Manta profile within the Surf Industry it greatly assisted overcoming the seasonal cash flow problems that had restricted the company. With the introduction of a partner injecting much needed cash to the company Manta was able to seek other markets and further develop the Blade Swim Fins and new materials into the Bodyboards range. The mid eighties floating of the $A also improved the exporting prospects.
  
• Further financial support came through additional business loans, equipment and vehicle leasing and temporary O.D. extensions to overcome the traditional cash flow crisis period between August and December.
  
• Some Government assistance was available through the Export Market Development Grant (EMDG) that allowed the recovery of some International Marketing expenses.

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• Facility & Equipment: Moving from the Lakemba site in the early 90's to a factory facility in the Sutherland Shire facilitated staff increases, delegation of roles and increased methodology to increase output to meet the demand increases. A more controlled factory with better layout and flow provided greater efficiency and the ability to formulate budgets and production schedules
  
• Machinery: New machinery and tools were purchased or leased, work shop and repair and maintenance developed, thus allowing a more efficient and reliable system of manufacture.
  
• Staff: Increased staffing, with area leaders developing training and skills lead to greater efficiencies and output. However finding suitable and available quality staff remains an ongoing issue. There are no recognized courses or programmes so much of the staff are unskilled or general process workers.
  
• Design & Product: The early designs were unique and (while taking on board the USA made ideas) were different and suited to the Australian market. Basing the product around the concept of a waterproof inner core the various models were manufactured using what are now primitive methods compared to the current manufacturing methods. Mostly hand shaped and glued the output was limited and the available saleable product small in number. This improved as raw materials suppliers (generally servicing the car or packaging industry) recognized sales potential within the bodyboard markets.
  
• Raw Materials were not easily sourced and generally unavailable in Australia. Japan provided both a high quality and readily available Core and a strong relationship has been developed with the supplier over many years allowing exclusivity and better pricing as volume increased. Lead-time and freight issues became crucial to the production.
  
• Systems & Q.C. As capacity increased Production systems became more important (as the methods moved from 100% hand made) with the introduction of hand tools and various machines.

back to getting started

• Family members and part-time staff were initially used in the office administration roles doing everything from answering phones, packing orders, invoicing, creditor and debtor control.
  
• Computers and office equipment were introduced to speed and control the previously book entry style accounting. Staff skills improved, systems and structures introduced to deal with the quickly expanding summer business.
  
• Office Staff & Training increased, phone systems introduced, concentration on Debtor collections allowed a greatly control over the business and its direction.
  
• Inventory Control of incoming raw materials achieved greater efficiencies as the company adopted a "just in time' system allowing smarter financial planning.
  
• Warehousing, Storage and Inventory control improved with dedicated staff and responsibilities. Getting the stock "out the door" in a timely and orderly manner were the majors keys to good customer relations within the domestic market and have lead to Manta being recognized as a reliable supplier to an often fickle and volatile surf market.

back to getting started

• Sales for an Australian made Bodyboard began slowly, a new sport often seen as 'kids stuff' made it difficult to achieve rack space in the surf stores. The unique Australian made durability and waterproof qualities of the Manta product gave it a marketing edge over the often poorly made and difficult to find imported Asian and USA made products.
  
• Network: Domestic: An existing network of Australian surf shops gave Manta a ready made domestic market. Persistence and regular servicing were the keys to gaining retailer confidence and overcoming the attitude of the 'standup' surfer owned stores. International: The finding of established surf companies or distributors for the leading surf brands was the key to making a success of the International business. In the wake of the many surfers from Australia and the USA traveling the world in search of waves many 'locals' were impressed with the lifestyle aspects of the surf market. Major USA brands such as O'Neil, OP and Gotcha along with the big three Oz Brands (Quiksilver, Billabong and Rip Curl) established business in these areas, most of them in key surf spots (eg: France, Spain, Portugal, Brazil). However the markets eventually expanded to any country with surfable waves with diverse countries like Japan, the UK & Ireland, Hong Kong and Indonesia now boasting substantial surf industries and cultures.
  
• Pricing: Manta positioned itself above the opposition brands in an attempt to set its product apart from the competitor. Marketing the waterproof nature and durability of the products allowed some upward flexibility in the pricing.
  
• Sales Team: Domestic: Finding Sales Agents with the infrastructure, network relationships and persistence was never easy but 'tagging' the brand with independent sales agents for the stronger clothing (software) companies such as Rip Curl, Mambo and Billabong made it easier for the Manta product to get opportunities within the leading surf stores. Seasonality was an issue for these sales agents as the Manta hard goods were generally only saleable in summer compared to the all year clothing products. International: The USA bi-Annual Trade Shows have over 2000+ companies displaying their products and services. Terry displayed his goods at these shows which opened opportunities to meet with the various International visitors.
  
• Identifying the International Markets: The eighties saw the start of the huge growth in the surf culture around the world. Prior to that time the USA, Hawaii and Australia were the main markets. However the global growth of the USA culture increased interest. The major difficulty for Manta was the development and recognition of the sport of bodyboarding in those countries. However some language and cultural differences, poor communication technology and infrastructure, timing differences (its 9pm in Rio when we get to work) made growth harder.
  
• Distributors: Finding the right distributor with the sufficient funding, Sales and retail network, business skills/infrastructure and understanding to grow the business was the final key. There are plenty of surfers out there wanting the 'lifestyle' however they lack a mix of the above ingredients to be successful.
  
• Austrade and Australian Business Ltd provide some support in filtering out enquiries from interested and potential distributors.

back to getting started

• Marketing Plan: Getting the mix of media advertising, sponsorship and promotions is the key. Manta has positioned itself as more durable, better quality product, using the waterproof core and high quality materials as the basis for its marketing. A mix of elite Bodyboarding competitors as the media focus and then developing a programme of magazine, TV, store promotions assisted in establishing the Manta brand globally.
  
• Marketing Budget: It is very easy to spend the standard 5% of gross turnover generally allowed. Strict selection of the most effective methods of brand development was crucial and an element of trial and error developed before a productive yet evolving combination was established. Manta currently spends 5.2% of turnover on its marketing budget.

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Financing the business

• Cash Flow: As the business expanded so did the yearly pressure on the cash flow. Surf industry retailers traditionally pay in the 30 - 90 day from invoice period. Therefore a combination of temporary Overdraft facilities, established supplier relationships with supplier contracts and flexible terms of trade, EMDG and strong suppliers relationships assisted through the tougher months. This supplier loyalty was repaid with prompt payment during the cash flush months (generally at the end of the Australian summer when the Australian retailers are paid up). 22% Sales Tax on domestic sales months, business growth of on average annual 20% from 1994 (in particular the International sales) also added pressure. However this increase in business also improved the overall position of the company and combined with greater efficiencies allowed debt reduction and the ability to market more strongly.
  
• Budgeting: Established sales information and production statistics has made forecasting and budgeting more accurate and achievable. This reassures bank managers and general creditors and allows a more stable work environment where staff can focus on big and longer term goals and issues. Expansion can be planned and Business Plans implemented more accurately.

back to maintaining the business

• Company Structure: Improved structures, policies and procedures combined with better quality and more skilled accounting & administration staff has seen consolidation and reliability in the workplace.
  
• Teamwork: Team and staff development and training have become more of a focus bringing fresh ideas to the company, Delegation of management roles, improved business strategy and adoption of better equipment, software and technology have all improved office productivity.
  
• Resources: Better use of Government and ABL assistance has seen improvements in the planning and implementation of the business plan. Use of the established distributor and retail network has also allowed outside feedback of ideas to be embraced to the benefit of the products and company.

back to maintaining the business

• Technology: Installation of better machinery, refinement of the processes and factory layout are all improving productivity without any loss in overall staff numbers.
  
• Staff: While turnover of staff is a major issue it has improved as company growth has allowed better wages and conditions. Training and delegation of duties has produced a core of loyal and responsible staff. The company is currently working with TAFE to develop a course in "Bodyboard" manufacture.
  
• Raw Materials: Continued development and co-operation with Raw Materials manufacturers and suppliers has assisted Terry/Manta in evolving a 'new age' of Bodyboards. These products allow Manta to produce the worlds first 100% waterproof Bodyboards, an exclusive. Established Supplier contracts have ensured better pricing, secure & assured supply, exclusivity for some items and the ability to ride out tough times.

back to maintaining the business

• Customer Relations: Long established friendships with retailers and distributors have been crucial to Mantas growth. Customer service, regular and reliable communication in particular with the major retailers and the various International Distributors has maintained the strong brand position within key outlets and markets. On a monthly basis a Manta newsletter is sent to the key people in all markets reinforcing the Manta "family" aspects of the relationships.
  
• Pricing: Maintenance of higher pricing for the 'top end' items while offering some cheaper volume products has established a wider range of options for Australian Surf retailers allowing them to focus their buying with Manta and to therefore drop marginal brands. End of season specials is important, in particular to countries and retailers who find it difficult to compete against cheap imports or discounting.
  
• Product Diversity: Manta has continued to grow its product range and has added Surf Accessories (now 8% of sales) to the Bodyboard and Swim Fins product groups.
  
• 80/20 Rule: A key principle that applies even more in these times. More consolidation in the Australian retail Surf market combined with the emergence of the major Surf brands into the retail sector with Factory outlets and takeovers (Eg: SDS-Vic now owned by Rip Curl) has seen the customer ownership base shrink while growing in overall volume. Internationally this is also critical, focusing on the major distributors in Japan, Europe and the USA has grown the business each season.
  
• Helping grow the Customers: Offering Distributors and Retailers assistance in sourcing other products or business concepts has also secured good relations and ongoing support.

back to maintaining the business

• Advertising has been the major tool for brand recognition. Manta adverts appear in magazines and on TV shows in Brazil, Portugal, Spain, The UK, France, Hawaii, the USA and in all three Bodyboard magazines in Australia. Where and when possible Manta secures the inside back cover of the magazines, it has become our spot. TV is also important as the 'extreme sports' programmes become more common and competitive as they introduce new sports to the target markets. Bodyboarding must become know to and recognized as important to the TV programmers.
  
• Sponsorship and management of the elite bodyboarders is important, companies must be seen to support the sport into which they are selling. Manta will support, Bodyboard Contests, Junior tours, GOB events, Learn to Surf days, Coaching Clinics, photo shoots to exotic surf locations and give prizes to most of the 30 Bodyboard Clubs around Australia.
  
• Having a booth at the USA Trade shows, making trips to the key retailers and distributors and improving and upgrading our Internet site are also key methods of marketing. (http://www.manta.com.au).

back to maintaining the business

Financial

• Better business planning, debt reduction, smarter systems (internet banking) and greater use of technology generally are the plans for the future.
• Consolidating our Intellectual property, inventions and patents will provide security of the brand and are assets that should grow in value.

Administration

• HR: Improvements in staff training, quality and security through better HR systems will work for both employer and employee.
• Regular updating of computers and software, adoption of new systems and technologies ,

Production

Constantly sourcing and securing better raw materials, staying abreast of technology and materials improvement, working with suppliers in securing long term supplies and maintain and improve staff

Sales

• New markets, consolidation, speciality, grow their business.

Marketing

• Company image & logo,
• Identity/lifestyle

Conclusion

The Future (Technology, new products, new markets)

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