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Marketing Planning and Management Final Assessment
Marketing Planning and Management Final Assessment
This case analysis aims to reflect upon the results of Mugly in the QUTopia market day
simulation. The ideas put forth by marketing theory will be applied to the various issues
experienced by Mugly, and critical reflection will be used to pinpoint problem areas and
evaluate solutions to them. The business itself produced nail polish marbled mugs and rustic
rope coasters, allowing the customer to express their sense of individuality through a normally
mundane every day item.
The businesses marketing objectives, developed in conjunction with the SMART goal setting
framework, are as follows:
Although the business only achieved four of its six goals, it did comparatively well when
compared to the rest of the market. It was the market leader with 44.76% market share, 44%
profitability, and turnover of $4495 (see Section 2.4), indicating a positive result in the industry.
Key problems in relation to the failed marketing objectives and other business issues are
identified in the body of this report. These problems include high expenses and their relation to
the unplanned award of bonuses, the inaccuracy of supply and demand forecasts, and issues of
product quality and their effect on sales.
A variety of solutions were developed for each issue faced by the business, which were then
narrowed down through the use of marketing literature to find the most effective solution to
each problem. These solutions are:
Implementing a structured planning system which sets out all company goals and the
processes by which to achieve them
Engaging in surveys of the target market, motivated by a no-strings-attached monetary
reward to increase response rates, and
The implementation of a stringent quality control system to ensure all products are of a
minimum acceptable standard. This system will be continually updated to ensure
constant improvement of quality.
Financial Situation.
Failed to fulfill market day one objective of reaching actual break-even point, falling short by $148, due to an increase
in fixed costs from the predicted break even analysis to the actual break even analysis (See Appendices A and B)
Achieved objective of reaching 30% profitability, ending with the highest profitability in the pool of competitors, with
43.98%
Failed to fulfill objective of 5 pre-orders before market day one, falling short by 1 pre-order. The business received a
further 6 pre-orders between the end of day one and the start of day two.
Achieved market day one objective of 3 mother’s day gift pack sales.
Achieved objective of gaining 30% market share, ending as the market leader with 47.46%
Sales records kept on the days were not entirely accurate and had to be adjusted post-market day to achieve accuracy.
Less of a problem on market day two, as sales decreased as expected following mothers-day, making for a less chaotic
sales environment.
Pricing strategy was designed to encourage the purchase of bundles, which offered large savings compared to single
purchases. These large savings were twofold: 1) to increase bundle purchases, and 2) to avoid pricing the bundles too
high, as each customer had a set income and was unlikely to spend the majority of it at one business.
Overpaid each member by Q$50 on market day one, wrote off as a bonus. Then paid each member an unplanned
Q$100 bonus after market day 1.
Negative Positive
Fixed costs were high and ballooned beyond estimates, resulting in the Highest profitability shows that despite
break even objective not being achieved. high fixed costs the business remained
Sales record systems implemented at the last minute were not competitive.
efficient, resulting in a long process to process sales and log emails for Market share of 47.46% puts the
survey responses. Feedback on the day and post-market day indicates business in the position of market leader.
lost sales as a result (see Appendix C). High demand resulted in all stock being
Q$100 bonus was based on inaccurate break even figures from the sold on both days, within 5 minutes of
initial analysis, which likely wouldn’t have been awarded after close of sales.
consulting accurate figures. Bonuses cost the business Q$750 in total. Pricing strategy succeeded in creating
Limited income of customers meant bundles were priced lower than demand for bundles, which were the
the business wished. most popular consumption format.
Company Analysis
The team worked effectively (see Appendix E), with a clear and fair division of roles, a culture of success maximization,
and an overall sense of camaraderie and friendship. All communications were purposeful, regular, and effective, and all
criticism and ideas were welcomed.
While the roles were well defined, the borders became blurred, with members doing things which may not have strictly
come under their ‘job description’.
Members channeled stress approaching market day in a positive way, and demonstrated flexibility and reliability in the
chaotic business environment.
The marketing manager did not over-exercise their power, allowing the members a level of self-management, providing
direction rather than specific instruction, fostering a culture of creativity and self-expression.
The team generally found an agreeable way around any difficulties which arose.
Negative Positive
The marketing manager may have seen greater The blurring of borders between roles had a positive impact in
success with a more stringent management this instance, allowing for greater efficiency, creativity and
strategy. communication.
The accepting nature of the team was in rare Each member brought specific skills to the business. All
cases interpreted as reluctance to cause conflict. contributed whole heartedly.
Marketing System
4/6 of the businesses objectives were achieved, all of which were developed using the SMART goal setting framework.
Demand wasn’t estimated as efficiently as it could have been, namely with teapot sets (see Appendix C).
Fixed costs were higher than expected due to lack of sponsorship and sourcing issues. One sponsor was acquired
through a member’s connections; however this was for packaging, which wasn’t the main expense of the business.
Sourced branding package freely through team member’s connections.
Twinings agreed to sponsor the business, however their product was never received, and they didn’t reply to emails
Mugly was relatively successful as a business over the course of the market day simulations.
However, as with all business ventures, constant improvement is necessary to stay relevant
in the highly volatile business world and combat the negative influences of inertia (Huang et
al., 2017). The most notable areas of potential improvement include expense minimisation,
supply chain management, and demand estimation.
After day one, the business used turnover as a measure of success, rather than
profit. This prompted unplanned bonuses totalling $750. Had profit been calculated,
it would have been evident that such bonuses would put the business below the
break-even point. It is essential to use the correct information when making a
management decision, as it is an invaluable “management tool to ascertain the
organization’s performance” (Stone and Desmond, 2017).
This was due to an underestimated demand for the businesses products, which was
difficult to manage due to pricing limitations (see Section 4.1), and resulted in the
business losing potential sales. Furthermore, a lack of direct competition added to
the high demand experienced, and an unmotivated and uncreative approach to
sourcing inputs and sponsorship caused supply to be limited by budget.
Figure 6 shows that the supply and demand issues experienced had a number of
influences. Root cause analysis pinpoints that inaccuracy of demand predictions is
the causative influence. The business needed to understand that reliance on past
data does not yield the most accurate demand plan model (Sharma, 2009), and that
“inaccurate forecasts can significantly influence the performance of the supply chain
in terms of increased inventory costs, backorders or loss of sales (Aksoy, Ozturk and
Sucky, 2012). Had demand been estimated accurately, management would have
been less reluctant to invest in more stock, as the profit potential evidently would
outweigh the expenses.
Figure 6: Root Cause Analysis Fishbone Diagram of Supply and Demand Issues
The cost of high quality inputs meant they were less accessible, which had a
negative impact on product quality, as some inputs such as glue had a very real
price-quality interaction. Furthermore, the lack of sponsors to provide high quality
inputs freely placed more stress on the budget. Survey results after market day one
showed that some customers experienced poor product quality (see Appendix L),
which was a symptom of poor quality control.
In consultation with Figure 7, root cause analysis identifies a lack of quality control
as the cause of a decline in sales towards the end of trading hours, due to the lower
quality offerings being sold last. An effective supply chain wide quality control
system would have detected and addressed all quality issues at the source, a critical
step in producing products that meet the requirements of the customer (Sila,
Ebrahimpour and Birkholz, 2006). As a result, sales would have remained constant,
increasing not only profit, but customer satisfaction, which “plays a very important
part in ensuring customer loyalty and retention” (Mohsan et al., 2011).
Forecasting Suppliers
Customer Pain: Completely internal process Customer Pain: Completely internal process
which has no observable effect on the which has no observable effect on the
customer. customer.
Ease to Solve: Requires the development of Ease to Solve: Liaising with large ‘suppliers’
surveys, and a financial penalty to the as essentially the smallest business
business. However this is a fairly imaginable isn’t easy, and will likely be met
straightforward process. with resistance.
Effect on other Marketing Processes: Has an Effect on other Marketing Processes:
effect on the planning process and on the Requires more time to be invested into
accounting function due to financial sourcing processes, however is a fairly
involvement, however the influence is isolated function.
minimal. Speed to Solve: Liaising with suppliers who
Speed to Solve: Creating survey takes time, as most likely have little interest or investment
does receiving responses. This won’t be a in the business will be time consuming and
length solution, but won’t be extremely quick frustrating, however with enough persistence
either. will eventually work.
Table 3: Score Justification for Supply and Demand Decision Matrix
It is important to keep a level head when making business decisions, and good
planning allows you to set an end goal, which makes decision making more efficient
(Bhasin, 2017). Equally important is ensuring that the correct financial measures are
used to evaluate business performance, as accurate financial analysis can evaluate
all areas of the business (Mišanková, n.d.).
This planning phase will allow the business to set clear goals and will prevent spur of
the moment decisions which can have drastic long term effects on the business. As
such, unnecessary expenses will be avoided, reducing the financial pressure felt by
the business. This will allow for more efficient decision making not only in the
financial areas of the business, but across all aspects of business operations,
increasing efficiency across the board.
The use of survey data will allow the business to predict demand with greater
accuracy, by getting answers directly from the businesses potential customers. This
will improve cash-flow, as the business will have greater financial security and feel
more comfortable spending money on product inputs. Furthermore, sales will
improve, as the business will be able to produce more accurate amounts of
inventory to ensure sales remain steady until close of business.
The implementation of this system will result in an increase of sales, as product sales
will remain constant throughout the sales period, eliminating the lower quality
products which caused a slump in sales towards the end of the day. This will in turn
increase customer satisfaction, as theory shows that customer satisfaction is
affected by the perceived quality of a business’s product (Anderson and Sullivan,
1993; Cronin and Taylor, 1992; Oliver and De Sarbo, 1988, cited in Ford, Joseph and
Joseph, 1999).
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