Identification of New Service
The official site of GoWrench introduces an online car service concept, which will be the main source as a reference towards the structure for Fix on the Go.
Go Wrench is a Canadian business that operates on some cities in Ontario and British Columbia. The company uses an application for customers to request the car service needed no matter their location within the specific cities. This way, specialized employers will provide the service anywhere but efficiently and with no need of long waitings as in the ordinary car mechanics. The services offered are battery and brakes replacements, as well as complete vehicle diagnostics, among other mechanical services the car may need. Additionally, this source is linked with the app customers use to schedule and ask for a specific car service, the platform eventually demonstrates how the the service is delivered to their customers. Go Wrench differentiates from other car services within the market given that it focuses on giving a high quality service to only specific brands which allows them to focus in a wider catalog of services. This car service has been operating for a while now which adds more value and reliability to the source in order to guide this new business that will also offer a similar service. (GoWrench, 2018)
On the other hand, a local car mechanic is used in order to acknowledge how the business works in Montreal city. Freins Cité is a general mechanic that provides different car services from maintenance, replacements, oil changes, vehicle inspection and much more. This mechanic works with common car brands used in the city, most of them considered non luxurious brands. As a regular car mechanic, this source will provide a general perspective of the business offerings, the deals and prices settled and the way customers communicate and set appointments to obtain the service. This source demonstrates to be rated among the best mechanics in Montreal, and the costumer's high loyalty and good commentaries about the service reinforces this source as a valuable guidance. (Freins Cité, n.d)
Fix on the Go therefore will be the new online car service offered in Montreal city. This service provides basic repairs and maintenance such as tire changes and oil changes. Nevertheless, for more advanced repairs such as changing brakes, a premium option is offered. Fix on the Go focuses on people with busy lives who are forced to wait at garages and pay lots of money for simple services that can be done for them at home. Therefore, along with an app for easy communication between the clients and Fix on the Go representatives, a mechanic will be dispatched to come to your request location and fix the car. Young to older adults with a tied schedule and/or located in remote areas will be benefited from this service as well as people who might not even acknowledge much about the automobilistic field. Fix on the Go services are available not only during the usual hours like the other car mechanics do, this car service is available during later hours at night during the week and the weekends.
Additionally, the need for car maintenance during the year, especially during winter is a factor that also increases the demand for this service. The lack of businesses focusing on giving a more personalized assistance through the help of technology opens a market opportunity that offers a differentiated service. As a competitive advantage Fix on the Go offers a premium service in terms of commodity and efficiency that other car services don't offer in this region. The main operational places in strategic areas within Montreal will allow to reach customers in a quicker manner. Moreover, the app will be managed periodically to establish a customer base and that way identify potential and existing customers that will be interested in new promotions and offerings, customers that will pay for a price that matches the good quality and personalized service the company offers.
Macro Environmental Factors
The political environment is significant from a business' point of view as all businesses in a country are influenced by the political climate developments (Gupta, 2013). This aspect comprises of the governing laws and regulations, government individuals and agencies in the location, and the general political stability. Any political decision can have a significant effect on a business.
Canada is a democratic country that has continuously encouraged innovation as part of its growth strategy. Fix on the go is an invention that would see people saving time and becoming more productive and efficient in the economy. Government encouraging innovation is a massive boost for the business.
The economic environment comprises of aspects that affect the purchasing power of consumers as well as their spending patterns (Bensoussan & Fleisher, 2012). It is vital to pay great attention to the significant trends in consumer demand patterns which determine their consumption or spending patterns. Canada is one of the wealthiest nations in the world. The target population is also comprised of majorly working class people with an economic income.
Furthermore, anyone with a vehicle would still need mechanical services. Offering the services at a premium price would be perceived by clients as high-quality service and would only interest those who can afford it. Thus, since this target age group has a disposable income, the service is likely to be a success.
The socio-cultural aspect of the macro environment analysis focuses on the study of the human population regarding their size, age, occupations, gender, and location among others (Gupta, 2013). This aspect is fundamentally crucial as it involves people who make up the market for the product. The cultural element affects how people perceive a specific product. In an era where mobile apps are appreciated across the globe, people in Canada and Quebec are no different. In Canada and Quebec, the target population is between 24 and 44 years. This age group is mostly working, studying, or both and is significantly involved in their lives. Since they are in remote areas of Canada and Quebec, they have less time to do other daily activities. Thus, having an app that would save them time from their busy schedules would be a success. Furthermore, this age group regardless of gender is educated and knows needed to use a mobile app as it is made up of the young generation of mobile phones, the internet, and technology.
In the current era, technological advancements are probably the most spectacular forces affecting businesses (Bensoussan & Fleisher, 2012). The technology industry is significantly growing across the globe and with new technologies come new products and services. Companies that are not embracing technology in this era are running out of business.
Canada is one of the most developed nations regarding science and technology. The majority of Canadians rely on the internet for work, leisure, as well as education. More than 74 percent of the population in Canada use the internet and mobile apps (Wood, 2017). Furthermore Wood (2017) asserted that Canadians are now spending more time on their apps than ever. Thus, the target age group for this business would mostly be using the internet and open to using technology for various purposes like mechanical services.
Since Fix on the go relies on technology and internet usage, the conducive technological aspect in Canada favors the business. However, internet plans in the country are highly regulated, and in some areas, internet speed is not very high. The app targeting populations in the rural areas will have to find out how internet speeds are in these areas so that it does not limit the users from accessing the service.
In overall, the macro environment analysis is most favorable to the business. Fix on the go, being a technology and mobile app based app, is poised to succeed as this is the direction businesses in the 21st century are taking across the globe.
Segmentation, Targeting, and Positioning
Secondary data and Sales potential
In order to identify the potential market size the first secondary source to consider is Statistics Canada given that is an official government database. It contains information about the demographics of Montreal which will be useful to find the number of people in our target segment aged 25 to 45. This type of data is surely quantitative and will be a factor in a larger equation for computing the total sales revenue for our first year in operation. A second source of secondary data is NM News Montreal, is an online news site that focuses on Montreal's society and in this case remarks its new approach towards online shopping and the new e-commerce trend that is transforming young people's purchase preferences. This source is valuable due to its focus on the main city where this business will be operating, moreover it contributes with information about the internet's influence through its society to obtain services and goods. Fix on the Go will differentiate from the market by providing a service through the help of a technological platform, therefore is important to evaluate the retail e-commerce profitability and its frequent use within the target market.
As indicated in the description of the target segment, this online car service must capture customers within Montreal that are not only between 25 to 45 years old but that also drive a car and that is used to purchase services and goods online. A 2015 study by Statistics Canada demonstrates that Montreal has a population of 4,098,927 and with 1,121,730 of people between 25 and 45 years old. This business stands out by reaching remote areas of the city therefore, these figures include the metropolitan area as well, which will be useful to consider in order to establish the potential market (Statistics Canada, 2016).
The market of interest is made up of other car mechanics around the city that should be considered as possible competition that owns a portion of the total market share. Based on a general research through yellowpages of 2018, 735 car mechanics were identified. These car mechanics include all types of car services from simple to more complex assistance. Fix on the Go will only focus on providing a more simple assistance but despite this approach it will still become part of the market as another type of car mechanic. According to Montreal Gazette, in the year of 2015 2,234,000 cars were registered in Montreal (Magder, 2015). Is important to consider that this market in Montreal is constantly growing, Radio Canada International informs that the sales of cars increased a 5 percent on 2017 and is estimated to relatively keep growing (Laborada,2017). Hence, the automobile field is interesting and profitable enough to enter and obtain positive results.
Statistics of NM news demonstrates that between 25 to 45 years old people tend to buy more online, also adding that 92% of these young consumers have already purchased online during 2014 (NM,2014). Focusing on these figures by default, it is expected to receive a higher user rate of this online car service from these people. Is estimated that from the chosen population of Montreal given its age demographics, the 92% of that population, will be 1,031,991 people who live in Montreal and also has a tendency of buying and receiving goods and services via the internet. This number represent the final target market. To estimate the potential market size a Desjardin economic study report of 2014 is use, according to the statistics for every 1,000 inhabitants there are 437 cars in Montreal (Noreau, 2014). Therefore, to conclude the estimation of the total market size the portion of cars that will be addressed is by considering the target market multiplied by the number of cars in Montreal and divided by 1,000. Through the following calculation. (473x1,031,991) /1,0000 the result shows that the market size will be of 450,980 cars.
Following with the potential sales estimation, Fix on the GO will charge an average of $40 CAD for the service provided, this number may vary due to the change of seasons. Eventually there are different prices for the products and tools the car may need but they will not be considered for the projection, the following estimation will focus on the service only as a way of analyzing the profitability of giving a premium service that goes to wherever the customer location is.
Hence, as a starting up business, given previous figures, by only taking 1% of the market share on the first year of operations Fix on the Go will be serving 4,510 cars that year. This result was obtained by multiplying the market share percentage (0.01) times the total market size (450,980). This number will allow the business to estimate how many cars the first year they should serve in order to cover their costs and be able to have profits. Taking only 1% of the market share will mean that by dividing the amount of cars calculated (4,510) by 10 months which represents a realistic projection of the operational time period the business will be starting up with, gives a total of 451 cars serve per month. Continuing, this value divided by the 30 days of the moth that Fix on the Go will be operating, given that it differentiates from the other car mechanics by working the entire month at generous hours, gives a result of 15. This number represents the quantity of cars served per day. By having a general estimation of the quantity of cars the business should attend every day, a more accurate amount of employers that should be employed can be estimated from this number to cover the job in an efficient way. 1% is a manageable amount the business can cover as a start-up business in terms of employers needed and quantity well served. With this market share, by multiplying the quantity of cars per year, times the price of the service, the total estimation of gross potential sales revenue is $180,392.
Marketing Mix and Marketing Plan
Fix on the Go's goal as a company is to provide a service in which car owners are able to use a mobile application or call a phone channel to have a mechanic come to their home or wherever needed in order to maintenance cars. Fix on the Go provides car owners with being able to do a wide range of tasks on normal everyday cars. These services are small tasks that can be done quickly and easily without being within a normal garage space. These tasks include services such as, tire changes, oil changes which includes changing oil filters, changing small pieces on the exterior and the interior of the car, changing; windshield wiper fluid, wipers on a car, spark plugs, brake pads, car battery maintenance, and other smaller tasks on the car that can easily be provided. Fix on the Go gives car owners an easy experience in being able to get mechanical services in the comfort of their own homes or even while working in their offices instead of the hassle of waiting three weeks for an appointment and waiting a to get the car fixed in a uncomfortable garage.
When talking about the three different levels, core, actual and augmented, Fix on the Go contains all aspects. The company offers a service in which is intangible meaning the person knows that the company offers them a car garage on the go, the core benefit being that the car owner is able to still carry on with daily life affairs while getting car maintenance. The actual part of the service is being able to drive a car in which has been repaired and serviced by Fix on the Go services. Fix on the Go guarantees a full guarantee that the car owners car needs are met and that they will be satisfied with the service.
Within the special characteristics of the services provided by Fix on the Go is its intangibility meaning that the task that the company provides can't be smelt, tasted or felt before actually buying or reserving the company's service. The service is a variable of many different possibilities, because it is based off different locations and the service can be provided at different times and different people depending on who answers to the call first. Fix on the Go cannot be saved or stored, it is a company that provides a service as soon as a car owner has requested for car maintenance. Lastly the service is inseparable the service is from the Fix on the Go, it isn't a product, rather a company based on hiring employees possessing specific talents for the job that no one else can separate from the company.
Some brand characteristics includes logos, brand personality and brand equity, which helps in making Fix on the Go a noticeable company. Fix on the Go's known color pattern is blue, yellow and black, refer to figure one for the logo including the logo and the company colors. Fix on the Go is a brand that provides quality and is efficient. The company is self-explanatory it is a company that is efficient and that every consumer will like, it is very relevant because for most people in Montreal they don't like going to garages or waiting for appointments to service their cars. The service provided by the company is unique and unheard of in this region and is distinct. The company's name is easy to comprehend and explains what the company is about, “Fix on the Go”, the company fixes and services cars on the go. Fix on the Go is perfect for this region because there is a lot of maintenance needed on cars in Montreal, whether it being the massive potholes or the change in whether, putting on winter and summer tires.
The pricing strategy of our service will be customer value-based pricing. The reason for this is that we are creating a service that already exists, but a making it more convenient and accessible, therefore creating more value for our customers. There are many garages that will do oil changes, tire changes, etc. None of these places (In Quebec) will offer a service that will go to the customer to do those repairs, the customers have to go to them.
There are many internal and external considerations regarding price that have to be considered for this service. For internal considerations, since our price strategy revolves around adding value to the customer, the price of our service will be more expensive than the normal garage, but that extra difference in price translates into more value for the customers. The prices will be set by the top management and the estimated demand for this will be high since we are the only service that provides this benefit for customers in the region of Quebec.
For external considerations, the kind of market we are in must be considered. The kind of market we are in is a monopolistic competition because, although we provide a unique additive for the customer, some people will still choose to go for the alternative, therefore we still have competition in the market and our service will not drastically affect how the competition will set their prices.
The market-skimming new product pricing strategy will implemented for this service because the our targeted market are people who want to pay more for the added value that we provide for them. The only product mix pricing strategy that applies to our is optional-product selling. The reason for this is because we have a base service (ex. Oil changes), but customers can request additional products (ex. Higher quality oils/filters) in addition to the base service to fit their preferences.
Possible price adjustments that can be implemented are promotional pricing. Promotional pricing can be used to encourage customers to have certain repairs done before the busy season (for example, changing to winter tires earlier) at a reduced cost.
The channel design decisions that we are facing with Fix on the Go is how will customers interact with our service, and how can we control the quality of repairs for our customers so we can maintain a high level of customer satisfaction. To answer the first question, we will be trying to interact with out customers via a large social media presence as well as our service which will be based around a smartphone. Because our target demographic (ages 25-45) instead of them needing to come to use we will come to them by allowing them to use the app and not needing to set up any appointments at a garage or store. The app will be designed around the idea that the customers can click a button and we will come to them and repair their car without them needing to move a muscle. The second decision is how can we main a high level of repair to keep customer satisfaction high? To do this we will create a large network of mechanics that must be certified by the company internally (via proof of certificate or etc). This process will take time because we do not want to rush things to make sure we have only the best possible mechanics using our service (ie if you want to be a mechanic on our service you can just start using the app you must wait until we allow you to be). Next each mechanic will have certain levels that must maintain in order to keep working as a mechanic on or service (example maintain 3.7 rating from customers and have minimum 25 repairs a months etc) This will make sure that we as a company only allow the best mechanics to give repairs to our customers so we can keep a high level of customer satisfaction.
As for channel partners we will try as much as possible to keep a direct channel with our customers via a mobile application on smartphones so we can keep that idea that “we come to you” and not we get someone else to come to you. However the only channel partner that we can see ourselves partnering with is a wholesaler for car parts. These types of partners can be important because what if customer of our service want a tire change or brake replacement but do not have the tires or brakes? So by having a wholesaler that can get the parts for customers this, can allow customers to not need to do anything other than ask for the repair they desire and do not need to go and buy the car parts they need also. For example a transaction would take the form of this; 1:customer ask for tire change, 2: app will ask customers if they have the tire already, 3: If they do the app will automatically send a mechanic to them to complete the service. However if they do not have tire this will happen. 4: the app will load up a partnered wholesale website and ask the customer for their tire information. 5: once complete the app will order the correct tires from the wholesaler send them to the customer, 6: once they are delivered to the customer, we will send a repair to complete the transaction.
Our service will have a vertical marketing system, more specifically a firm-sponsored retailer franchise system franchise organization system. We will use this marketing system because it allows us to control when new mechanics (or franchises like the marketing system calls them) are added to our service and we can control if we want to shut down a mechanic because either it's not providing a good enough service or not create enough revenue for us. And also like this system we the company make a percent of all transactions as a royalty (for example if repair cost 70$ and we have a 7% royalty on each repair we get 7$ from that repair.
To distribute our service, we will be using a application launch called a “soft-launch”. A “soft-launch” is when instead of making the app available everywhere we just make it available in certain areas to make sure the app is functional and will not cause any serious issues for customers. Then overtime we will gradually increase our serviceable area for the app until our target area is completely covered. We do this because 1: we want to make sure we can service our entire customer base effectively and this will be difficult if they app if available everywhere but some areas have no mechanics in the area to serve them and 2: to make sure the demand for our service is high and controlled so customer to stop using the service because of issues they have with the app. So for example we will soft-launch our app in the greater montreal area only at first. Once the app is stable and demand is high or steadily increasing we will add label to a serviceable area and repeat until our entire target area is serviceable.
2. Sales promotion
3. Personal selling
4. Public relations
5. Direct Marketing
1. To connect with as many customers and potential customers as possible, we feel that many different sources of advertising could greatly benefit us. As previously stated, Fix on the Go is an automobile service that provides basic repairs and maintenance to people in the province of Quebec. Given that our customer base are all drivers or people in possession of automobiles, we feel that a billboard either near a highway or downtown would be very beneficial. When people get caught in traffic, billboards are surrounding us with advertisements and simple reminders. Fix on the Go would like a billboard to simply remind people about the importance of auto repairs and the convenience Fix on the Go offers. We also believe flyers and or newspaper/magazine advertisements would allow for us to connect with people of all ages that are in need of a car repair. Our primary goal is to properly advertise ourselves so we can compete in the auto repair market and create a name for ourselves.
2. To encourage customer loyalty towards Fix on the Go we plan to have many cost saving opportunities for new customers. We will be providing first time customers with 25% off their first auto repair as a thank you for choosing Fix on the Go. We will also give each customer a loyalty stamp card which will encourage customer loyalty. After each repair Fix on the Go provides, customers will receive a stamp from their mechanic and once the customer receives 9 stamps, the 10th auto repair will be paid for by Fix on the Go as a customer reward to encourage customer satisfaction. Fix on the Go wants to have strong customer relationships to allow for us to connect with our customers to provide them with the best service possible. Our promotional strategies are our way of saying thank you for choosing Fix on the Go.
3. For personal selling, we think that it would be beneficial to partner with a few popular car dealerships such as Honda and Toyota to accompany them at a few of their locations to have a face to face interaction with potential Fix on the Go customers. This would allow for us to create a relationship or partnership with these car dealers as well as receiving the opportunity to interact with customers. We also believe going to places such as Canadian tire and Home depot to pass out business cards and information could allow us to try to form a bond with customers. We feel it is very important to create a trustworthy relationship with our customers to ensure they feel comfortable and confident in choosing us to perform their auto repairs.
4. In terms of the public relations and communication side of Fix on the Go we would like to have a strong social media presence to allow for a more accessible and personal relationship with customers. We feel it is important to be present on social media primarily to engage with not only the younger demographic but all potential customers to are active on social media. Social media is constantly evolving resulting in more people of all ages to participate in the world of social media. Social media is also a very cost effective way of marketing ourselves so we plan to use that to our advantage. We would like to have a Facebook page as well as an Instagram page and of course our Fix on the Go website. All platforms will be full of information and opportunities for customers to connect with mechanics. Social media will allow for Fix on the Go to be accessible to anyone at any time directly through their smartphones. Technology plays a huge role in many people's day to day lives so we thought that Fix on the Go should conform to this style of living so many people adore. Fix on the Go offers the simplicity of simply pressing a button on your phone to request a mechanic to come to your house.
5. We will be targeting people between the approximate age range of 25-44 according to…(insert stat). We are choosing to target this age demographic because it is typically an extremely busy time of life for people. Fix on the Go will provide the luxury to males and females of having there auto repairs done at their homes or a location of their choice. Fix on the Go will have a toll free calling number for customers to contact us at in order to request a mechanic.
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