MARKETING PLAN

Executive Summary
Brickworks is planning to launch the eco-friendly carbon-neutral bricks in the building products
market(“Clean and green: Austral’s new carbon-neutral bricks – Brickworks,” n.d.). This product
is considered to be the long-term sustainable solution to climate change and global warming by
reducing the amount of carbon emitted into the atmosphere from the construction industry. The
company is very excited to grab the opportunity to improve its customers base as it is dedicated
to conserving the natural resources and reduce the environmental impact of its operations("Clean
and green: Austral’s new carbon-neutral bricks – Brickworks," n.d.). The clay bricks are heavy,
adds more weight to the whole building and are environmentally compromised due to soil
excavation. The primary objective of the company is to increase EBIT(Earnings before Interest
and Taxes) by $22 million, covering the losses from the previous year. However the primary
financial objective of the company is to improve the sales revenue by 10%. 'Despite the
challenges being faced due to the global pandemic COVID-19, Brickworks continues to work on
its objectives by formulating a right marketing strategy.

The data shows that all the ratios such as returns on shareholder equity, net debt to equity and
net tangible assets per share accounted for 16%, 20% and 7% growth respectively(Brickworks
Limited Annual Report 2019, 2019). The other financial parameters such as underlying earnings
per share, dividends and Net Profit After Taxes(NPAT) have shown a growth of 4%, 6% and 4%
from the previous year. This report highlights that there is a need for eco-friendly and innovative
solutions to the problems in building materials industry as the cities are experiencing the worst
air quality index due to Australian Bushfire. The data shows that construction industry
contributed 23% to air pollution, 50% of landfill wastes, 40% to water pollution and 50% to the
climate change. The US Green Building Council stated that 40% of the worldwide energy is
being used by the construction industry(P & it, Feb 11,2020.). This report focuses on future
prospects of the company to maintain high standards with respect to its economy and
environment. The company aims to achieve an improvement in overall performance without
compromising the quality of the products. Reduction in sales revenue due to higher energy costs
and carbon emissions needs to be addressed and requires remedial action by the management.

Table of Contents
1) Executive Summary
2) Current Marketing Situation
3) Threats and Opportunity Analysis
4) Objectives and Issues
5) Marketing Strategy
6) Action Programs
7) Budgets
8) Controls
9) Conclusion
10) References

Current Marketing Situation

The building material products of Brickworks have a great demand in the market and is
considered to be one of the most reputed manufacturers. A sound marketing plan and strategy is
required to meet the demands as the consumers behavior is very subjective. The launch of Glen-
Gery in 2019, one of the USA's largest brick manufacturers had a great integration of marketing
and operations which shows that it takes a good care about marketing initiatives whenever they
launch a new product. The presence of a strong marketing organization team is a huge plus for
the company in its current situation. Brickworks is experiencing a huge competition from the
local and global markets(Basalite Concrete Products, Fletcher Building limited, Boral Bricks
Inc) and there is a need to monitor them to win the customers. Since its inception, the company
remained public and they make sure that they abide by the environmental regulations of the state
and federal governments in Australia. The additional requirements issued by the local
governments are also taken care in most of the sites. The company continues to be proactive in
their approach by investing in technology, market research and development.

The company enjoys the competitive advantage as it possess a unique marketing strategy, strong
relationships with partners and key suppliers and outstanding technical expertise. The company
has a secured future because of the high retention among the experienced employees through
long-term incentives and equity participation in the company. It is well known that resources are
limited, So the company is trying to make efficient management of resources through proper
waste management and shifting to renewable resources. Brickworks has excellent growth
opportunities in global markets and USA and the company strives to drive a circular economy
across all its operations. It has high focus to reduce water usage at all its manufacturing sites.
The company holds many brands that are efficient and innovative in manufacturing the products
and some of them are Austral bricks, Bowral bricks, Bristle roofing, Austral precast and GB
Masonry etc. As the consumer demand continues to grow, Brickworks targets specific segments
of the market to deliver its products. The company has several committees to look into safety,
sustainability, annual budgets, acquisitions etc. and are primary responsible for decision making.
The acquisition of latest brands made Brickworks gains a strong footprint in market leadership
and it aims to expand through its wide distribution network. Below is the pictorial presentation of
revenues and earnings of Brickworks from the past two years, 2018 and 2019.

$785mn $919mn $311mn $346mn $226mn $234mn 54.0c 57.0c

Total Total Underlying Dividends

Revenue EBITDA(Ear net profit
Growth- 6%
nings after tax
Growth-17% before
Growth- 4%
Interest,
tax and
depreciatio
n)

Growth-
12%

2018 2019 2018 2019 2018 2019 2018 2019

Note: Dividends calculated are per share(cents).

Threats and Opportunity Analysis

Anticipation of any positive or negative developments through the launch of the product can be
done with the help of threat and opportunity analysis. Under the Australian government's
National Carbon Offset Standard, the products of Austral Bricks and Daniel Robertson were
certified as Carbon Neutral(“Carbon neutral bricks case study - Build for Living,” 2019).The
combination of sawdust, biomass and by product of timber industry is used as the fuel for kiln
firing which made them achieve the right products. The opportunities and threats for the
company are analyzed and are written below:

OPPORTUNITIES

1) Mitigate the effects of climate change and global warming on environment. Data shows that
23% of carbon emissions in Australia are from buildings industry(Lizhen Huang, Guri Krigsvoll,
Johansen, & Xiaoling Zhang, 2017). The carbon neutral bricks will reduce the amount of these
carbon emissions into atmosphere. This is a great opportunity for the company to market its
product.

2) Helps to manage its operations in an environmentally sustainable manner and leads to less
production of waste across all the manufacturing sites. Sustainable practices should be adopted
and green building products should be manufactured widely across the industries.

3) Reduces operating costs for the company.The carbon neutral bricks have high durability,
recyclable and it's a win-win situation for both environment and homeowners as they have no
extra cost.

4) Promotes to drive a circular economy. The integration of the green technology along with
automation may even fasten up the process, improve the production and helps us manage
buildings more efficiently by shifting towards renewable resources.

5) There are very few competitors for the carbon neutral bricks for Brickworks in Australia. The
company should focus on improvisations and market this product to grab the large chunk of
Australian market. Although there are few alternatives in the world such as usage of geo
polymer-stabilized soil materials and Net Zero Energy concepts.

6) Efficient usage of resources available. The low Carbon dioxide emissions are due to the usage
of biomass(organic matter derived from living organisms) instead of fossil fuels. The annual
emissions from sawdust stands at 215 tonnes of Carbon dioxide and those from natural gas
stands at 8607 tonnes of Carbon dioxide.

THREATS

1) The only downside for the carbon neutral bricks would be that it adds more embodied energy
to the building. Brickworks should try minimizing the energy through the necessary research by
the technical expertise team. R&D department must focus on this part to improvise the
manufacturing of bricks.

2) There is a need to monitor the competitors because there is a high possibility of losing the
customers if ignored. Adopting the best practices from other businesses would add credibility to
the products.
Objectives and Issues
Objectives
1) To increase the EBIT(Earnings before interest and taxes) by $22 million in the sale of carbon
neutral bricks

2) To achieve a wider and diverse customer base across the global markets including Australia

3) To improve the sales revenue by 10% in the current year

4) To formulate right marketing strategies and ensure quality control.

5) To increase the production capacity across all the manufacturing sites

6) To extensively focus on product improvement and eliminate product failures

7) Explore, expand into new markets to continuously improve the business

Issues
1) No proper and regular audits conducted at manufacturing sites and raw material sites. If these
audits are done regularly by external and internal auditors, the hazards or any issues will be
rectified in a timely basis. This will eliminate product failures while manufacturing.

2) There should be immediate and timely remedial action by the management for any issues such
as problems with productivity, quality control and disaster management. Any new launch of a
product will demand the same from the consumers.

3) The environmental board committee must put ecology as its high priority and design
appropriate systems to adhere to the regulations. This may bring down the company's reputation
in terms of understanding risks.

4) Pending prosecutions with respect to environmental issues might hinder the marketing of the
product.

Marketing Strategy
A right marketing strategy will definitely help any organization to improve in the overall conduct
of the business and the same goes with Brickworks. Initial stages of product development might
incur low profits and slower growth because it is new to the market and this will be different in
later stages of the product life cycle. So, the current marketing strategy is designed to address the
initial growth stages of the carbon neutral bricks. The market segmentation on the basis of their
needs, preferences and their behaviors is a prerequisite for any strategy formulation. However,
the 4P's of marketing that include product, price, place and promotion should be taken care
before the launch of the product. I would like to mention a few marketing initiatives to improve
the brand image and sales of the product and they are mentioned below:

1) To communicate with potential customers by using social media platforms such as Instagram,
Twitter etc. We are all living in the modern era where social media can't be ignored by anybody
and this should be the catch for the business to promote using these sites. Posting relevant
information about the carbon neutral bricks is an easier option, yet powerful though.

2) In order to stay ahead of the competition, Brickworks should effectively frame pricing
strategy to attract new buyers. The pricing should be fixed in accordance with the demand from
the consumers and continuously educate them about the features of the product.

3) Blogging effectively by posting the benefits and characteristics of the product will gain
necessary attention towards it. Appoint a manager to look after the blog and answer the questions
posted by the customers. This will create a confidence in the minds of customers who are
looking to buy better products.

4) Brickworks should target individually the specific segments of the market to cater the needs of
the customers. The distribution strategy of the company shall be programmed to attain a
maximum coverage that will improve the sales of the company.

5) Above all, a thorough market research is needed to identify the target market so that the right
strategies are applied at appropriate levels of marketing. Communication plays a major role in
marketing of a product, especially the new launches and it demands a proper research.

Action Programs
The action programs for the launch of the carbon neutral bricks requires a proper implementation
of the marketing strategies at right time. Brickworks would be launching the carbon neutral
bricks in the month of February, 2021. These steps are systematically mentioned below to
achieve the objectives:

January: Once the target market is identified, educating the customers and the dealers through
digital marketing and campaigns to set the right environment for the launch of the product in the
month of February. In order to explain the carbon neutral bricks benefits, the employee staff will
be working in collaboration with the sales department.

February: The company would be targeting different set of customers and clients through
various packages and benefits. At this stage, the product would be able to reach out its diverse
customer base and they start thinking and planning about buying the product. Surprises sent to
the customers would work because the customers also act as a good sales people by promoting
and sharing their experiences.

March: Officially, the company would be announcing exciting offers for the customers who had
a great experience with the product. Responses through digital marketing sites will be recorded
and marketing through social media continues to be a strong weapon for promoting the product.
Initially, the company will have slow growth despite spending higher costs on advertising and
marketing.

April: Employees also play a major role in the growth and development of the product.
Brickworks should offer incentives to the sales force who would make most of the deals with the
customers and clients. This will internally motivate the employees to work for the new product
launch.

May: In this month, Brickworks will be expanding its advertisement about the product. To grab
the customers attention, we will be including the experience in videos and statements from the
celebrities. Full scale marketing and promotion of the product will be done at this stage.

June: Brickworks is a customer-centric company, hence it will ask for a feedback from the users
and customers to improve its marketing and product activities. Comparing with the other
products in the market from different competitors and using this differentiation to market its
product.

Budgets
The marketing budget is an estimated cost incurred by the current project for marketing the
carbon neutral bricks. The whole costs include the costs involved in the distribution, marketing
and production of the product. The estimated profit would be the expected revenues minus the
whole costs incurred. The profit and loss statement is a very important part of the budget
allocation. However financial and income statements from the company would be useful to make
the profit and loss estimates. The consolidated income statement from the Brickworks Annual
Report 2019 says that the net profit after income tax expenses were $65,722 compared to
$105,920 in 2018(Brickworks Limited,  Annual Report 2019, 2019). There is a decrease in the
production levels across the manufacturing sites to control the inventory levels as it leads to low
earnings and higher unit costs.

To increase the total sales revenue by 10% this year in the sales of carbon neutral bricks. In the
year 2019, the sales revenue decreased by 4% to $428 million. So, the launch of this product
shall aim to bring back the growth in the sales revenue. However before releasing the budget,
there should be pre-budgeting research. This research will help us to go through internal
marketing performance records and competitor analysis so that the budget becomes pragmatic
enough to achieve in the real world. The break-even analysis of the product is determined to
predict at what point the company becomes profitable. Let's say the total fixed costs for first year
would be $16.5 million. The average wholesale price for 1000 bricks would be $700 and the
variable cost for the same stands at $450. The break even calculations indicate that the company
would turn profitable after selling 66000 units. This is a good indication and Brickworks is well
prepared to handle this wait for long growth.

Controls
Controls is an important step in the marketing plan. It helps us to analyze whether the actual
performance has been able to meet the established standards or not. The corrective or remedial
action will be taken by the management to rectify the issues and problems. It will help us to
adjust our actions in accordance with the objectives. It is very important to look at how the sales
is happening and if the advertising is gaining the anticipated interest. Of course, there are many
approaches to control which will be filtering out all the unwanted actions from sales to service
levels. The total costs per every sale should be monitored and compared whether it is profitable
or not. The ultimate goal is to make the customers buy the product and the quantity of sales
should be compared with the estimated values. Marketing controls is very crucial step to any
organization because it keeps a track of budgeting, sales, customer feedback and spending. All
the objectives which were targeted will be measured, evaluated and monitored for the
improvement of the process. In fact, if there is any discrepancy in the achieved and estimated
results, then the Controls team will investigate why there are differences and advice a corrective
action.

Conclusion
Brickworks can do wonders in the category of bricks industry, especially with the brand of
austral bricks. There is huge possibility for long term growth of the product and Brickworks is
ready to offer the customers and clients with satisfactory products. In fact, the success of the
organization is contributed by its long sustaining and retaining staff for their sincere efforts and
commitment. I hope the same is carried throughout the journey of any new product launches
from the company. The launch of the carbon neutral bricks will also be a huge success for the
company provided it adopts and implements the right marketing plan. The Brickworks products
are characterized by great demand in the market despite increase in prices. The company should
continue to invest in innovation, style and product development in order to improve the
dividends. Brickworks should keep up the organizational performance in terms of marketing,
sales, production, quality, efficiency etc and move ahead in a proper strategic direction to
achieve its objectives.

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