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  • Subject area(s): Marketing
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  • Published on: 14th September 2019
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  • Number of pages: 2

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<front page>

I fixed Headings and table of content

I fixed grammar and general "tone" of the text, check notes bellow.

- never use "should, we want, we are thinking, maybe". etc.

always use positive words like "We are doing, we will, is, will be" etc.

Idea behind this is that, we, as a writers of business plan and represents

of the company, we are confident what we are doing and know

what we are doing.

- in general, when talking about what ICT- company offers to customers and clients, don't specify too much like, application, software etc. use words "product", "solution", etc.

-kasper

Table of content

 

Table of content 2

1.  Executive summary 4

2. Situation Analysis 4

2.1 Our customers 4

2.2 Our Market 5

2.3 Our competitors 5

2.4 Intermediaries, influencers and potential partners 6

2.5 SWOT Analysis 6

3. Business Canvas Model 7

4. Objective settings 8

5. Strategy 8

5.1. Targeting and segmentation 8

5.2. Positioning 8

5.3. Proposition and the marketing mix 9

5.3.1 Marketing mix 9

5.4. Brand strategy 11

5.5. Online presence 12

5.6. Customer and content engagement strategy 12

5.7. Digital channel acquisition communications strategy 13

5.8. Social media marketing strategy 13

6. Business Model 14

6.1. Revenue streams 14

6.2. Costs 15

7. Sources 16

1.  Executive summary

Business For Three (B43) is a global software development company with niche expertise and a focus on the latest technologies. Since 2018, we have been helping people achieve their goals with impactful software solutions.

Our new project is an mobile application, Running, that stimulate users to do sports, and to enable them to track fitness activities using GPS- tracking.  Users will be challenged by the application, or by other users, to achieve weekly and monthly activities tasks. Most flourish users of the these challenges are awarded by various prices.

2. Situation Analysis

B43 offers high quality software solutions to the users, and deliver innovative products to the clients. We are mainly focusing to provide solutions for individual users, all around the world. This new application, Running, is targeting people who want stimulation to do sports and to people who want to challenge their friends and families to move.

2.1 Our customers  

Our main market segment is any person who wants to lose weight and feels that they need the motivation to do sports, and are up for the challenge. People between ages of 25 to 50 years old will be our target group, because middle aged adults are found to be less motivated compared to young adults. However, the app is of course also available and usable for people outside this age group.

Table 1 Age Profile of Mobile App Category Users (From Marketing Charts, 2017)

2.2 Our Market

Our company focuses on finding the unique products by understanding customer and target group needs and desires, and then create innovative, interactive and state-of-the-art solutions to fulfill their needs. We mainly want to target customers in Europe and USA. We understand the culture of these targeted countries and how goals can be achieved.

Our most important customers, for this new application, are young adults who do not do sports, because they have no competition or have this question in mind, why should I sport?. These people know about the health benefits of sporting, but they tend to be sluggish.

This is little bit too short.

2.3 Our competitors

The key feature of the Running. Application is the challenge and awarding system.

The competition can be in the following forms:

We offer 1 month of free premium subscriptions, if the user runs 50 KM within a one month, this feature is not offered by Runkeeper, which is our main competitor.

If user achieve their targets, whether against other users or the application itself, they will receive awards and trophies, such as access to new features, discounts from our official sponsors and partners ( so not only one brand as it is with runkeeper), and many other free sport related gifts.

If other competitors, like Endomondo or Runkeeper, will try to apply and copy our challenging feature. Then we will create an new feature, where users can receive free consulting services about nutrition and sports.

All other sport applications are offering freemium licence, which make it hard for us to compete. But our application will be expanded with other new features and to include also other sport beside running.

2.4 Intermediaries, influencers and potential partners  

Intermediaries and influencers

We will create broad and exclusive network around our company by contacting famous health coaches, professional athletes and awarded personal trainers. We will use this network part of the marketing plan.

Potential Partners  

Our partners are Whitings, Under Armour and Nike. Potential other partners are various sporting brands (clothing, shoes, sports gear, etc.), wearables manufacturers (sport watches, heart rate sensor, trackers, etc.), various music platforms and sport events, like city marathons, obstacle running etc.

2.5 SWOT Analysis

To visualize the strengths and weaknesses of our application, we made a SWOT analysis. SWOT stands for Strength Weakness Opportunity and Threat. Based on this, we can pay more attention to possible threats and weaknesses of our app.

STRENGTHS

Motivating (Awarding system)

Usable for anyone & large target group

Health coach

Continuous market research

WEAKNESSES

New to market

Lack of experience

Startup (e.g. small staff)

OPPORTUNITIES

Expand app to the other sports

New technology

Hype of being fit

(Promotional opportunities) Partners

THREATS

Strong competition

New competitors developing in US or Europe (fast moving industry / low entry barrier)

Different regulations in other continents

Ending sponsorships or partnerships

3. Business Canvas Model

PARTNERS

Sport platforms

(clothing, shoes, sports gear)

Wearables manufacturers

(sport watches, heart rate sensor, trackers)

Music platforms

Sport events

(marathons, obstacle running)

ACTIVITIES

Research

Developing new features

Research and analyse competitors solutions

VALUE PROPOSITION

Stimulate users to do sports by set of challenges.

Build sport groups based on their real-life performance.

Challenge your friends and the app.

Ability to track performance and distances and compared to other groups with the same level.

CUSTOMER RELATIONSHIPS

Free with limited features.

Trophy & award system.

Challenges among users.

Promotional offers.

CUSTOMER SEGMENTS

“Young” adults

25 to 54 years old.

Any level of experience.

Have smartphones.

Have access to internet.

RESOURCES

Marketing specialist

Software engineer

Developers

Sports consultants

Designers

CHANNELS

Website

Android mobile app

Wearables support

IOS mobile app

COSTS

Development

Testing

Marketing

Partnership relationships (sales)

REVENUE STREAMS

Hybrid (In-app ads & purchasing) revenue model

Subscription model (€7,99 p.m.)

Advertisements

4. Objective settings

Build brand awareness: we need to establish ourselves as experts in developing applications, this means we want to target as many users as possible and go beyond our borders and spread worldwide.

Grow market share: we need to increase our brand-name reference partners and to  include more sports in the application. So during the next two years we need at least two new main partners/sponsors and add new sport beside running.

Enter new markets internationally or locally: we need to be popular in one of the major countries in Europe and USA during the first year.

Enhance customer relationships: give our users the opportunity to provide feedback. We also will use to rewarding system which will make an interactive relationship with the users.

5. Strategy  

5.1. Targeting and segmentation

For segmentation, from mass marketing segment - sport industry, our company focus will be in the aerobic and endurance sport segment.

Company's target is in area running and it's various different forms.

5.2. Positioning   

Company will focus positioning in industry of sport applications and self-improvement. Marketing positioning focuses offering our application in all major marketplaces for the mobile applications.

5.3. Proposition and the marketing mix  

Get motivated | Get motivated again to workout with your friends and the Running. application community.

Keep running, Get Awarded | Join our weekly and monthly challenges and earn rewards and prices.

With RUNNING. You never run alone | By following and taking part of challenges and community you don't feel alone.

Run For Premium | When you move those running shoes 75 km in one month - You will be awarded by the Premium Subscription!

5.3.1 Marketing mix

The marketing mix can help us define our marketing options regarding product, price, promotion, and place. This way we can meet our specific customer needs and/or demands. The 4P's of marketing is a method for defining the marketing mix, the 4P's are

Price, Product, Promotion and Place.

Price

Our app will be available for free and for everyone to use, but we also offer a premium subscription which unlocks additional features. The premium subscription will cost €7,99 per month. We also have a special offer where users can get one month premium for free.

For further details and explanation about the prices, please refer to chapter 6: Business Model  

Place

The users can download the application for free to their mobile phone via the App Store and the Play Store, they can also visit our website to find further information on the app.

Promotion

We have several promotional strategies, with a booth at sports events, spread vouchers, Search Engine Optimization (SEO) and advertisements on social media (i.e. Facebook, Instagram). Additionally, we have our own website which promotes our app; the link to our website is https://kasperhamalainen.wixsite.com/running.

As part of our promotion strategy we will also launch our own Youtube channel with tips and tricks from health coaches, morning routines from professional athletes, etc. We will be doing promotion through our partners, via the challenges and awards. Moreover, we will promote our product with affiliate marketing via sports blogs, sport shops etc.

Product

RUNNING. is not just another sport application it is a life changing sport application, backed up with world famous athletes, health coaches and most important -  it is the missing link between world wide running community and you.

Achieving goals is best done with other people. Compare your process to other Running members by challenging you and your friends. Hardest part of running is getting started - that's why we introduce all new way to keep you motivated.

We offer you top of technology tracking feature and when you move those running shoes 75 km in one month - You will be awarded by a one month Premium Subscription (Run For Premium challenge).

Also join our other community challenges and win exclusive prices from our partners!

The RUNNING. app has a nice, simple, and accessible interface and

 design. The pictures show the app icon, app design and website

 design:

5.4. Brand strategy

Company's brand strategy will be build on top of reliable, compelling and challenging mobile application and powerful community of users and affiliates.

Strong and reliable image of effortless user experience is important image for the application. Used software solutions behind application are always on up to date, in ways of performance, security and availability .

Application has to be in it own way compelling and challenging to form long lasting user relationship. Our continuously improved and updated features are essential part of brand image to keep interest of application user base alive.

Part of our brand is community of application users, our partners, various professional intermediaries and most famous influencers from sport industry. We believe that transparent and large community makes strong and credible brand image.

5.5. Online presence

Website will be our main digital presentation. It serves as a click-thru landing destination from all our online marketing presence. In addition, for our website to be found, we optimize SEO by writing effective description for our product.

We also want to participate and share our stories, therefore we are  using social media to increase our visibility and presence. We have two types of Facebook pages, one for our company in general and the others are just for our applications, including our new application Running.

We are also spinning up YouTube- channel around Running.- application. V-Bloggin is an addition to our online presence, where we can promote our product by strong visual message, video. We will also form unique connection to the users by using YouTube live session feature, where we can do Q&A- sessions with partners and influencers, all this leading to the increase of interest about product and monthly users.

5.6. Customer and content engagement strategy

Customer engagement is about the connection or relation between the customer and our company, it can stimulate further brand growth and loyalty. We can see users with high engagement to our company as ‘fans', whom not only are tended to often ‘buy' something, they will also encourage other people to use RUNNING.  These ‘brand ambassadors' tell others (SAY), purchase more frequently (SPEND) and use the app longer (STAY).

Social media (Twitter, Facebook, Instagram) is a great place for us to get more interest, interaction between users and sometimes even viral attention for our brand. Also by posting customer reviews on social media we can a (re-)engage users. Review traffic is a more engaging channel than many other traffic-driven channels, because people can relate more to something written by real users than content written by the brand itself. Also we can use social media to be customer service-oriented, to listen to users' complaints and respond. This is a great strategy, because it makes our user to feel heard and noticed, and we can also receive negative and constructive feedback, wich we will use to improve the product.

Regarding to the content, we want to create and have useful content, this will increase the user experience as well as user satisfaction. By providing, for instance instruction videos or videos with tips and tricks, almost 50% of the smartphone users are more likely to install and use the application. We'll be having a special Youtube channel with short videos about  tips and tricks from health coaches, morning routines from professional athletes, etc.

User personalized communication is another customer engagement strategy, this can go from ‘Happy birthday!' mails to personalized offers and coaching tips, and special events or challenges which are location-sensitive.

Through customer collaboration we can work with our users and ask about their opinions or ideas. An example could be asking their opinion about a new challenge, or user contest where users can come up with the next challenge. This strategy has a great impact on our brand, because the users feel like they're a part of the process and have an ownership feeling seeing the brand succeed.   

5.7. Digital channel acquisition communications strategy

Advertising

Online partnership:

Sponsorship

Affiliate

Search marketing:

SEO

KPIs ->

Nr. of active users.

Nr of total runned km's

Social Media numbers

Nr. of downloads

5.8. Social media marketing strategy

Strategy Statement

Social media is an open dialogue between our company and our customers. It is an open windows to see our weakness and strength. The social media is more than Facebook,Twitter or Youtube. It is every platform that make it possible to engage with the audience. And the popularity of social media is consumed differently from one region to another, but US and European market are similar. According to statcounter, in both regions the most popular is Facebook and Pinterest with average 60% use Facebook and 23% use Pinterest.

With social media we can share our views to demonstrate our field, listen to our customers and respond to their opinions, and of course to know our stakeholders.

Our goal of this marketing is to approach as many as possible of social media users. Our social media platform will increase the awareness of our product. Our strategy is aiming to achieve the following:

Undertaking a full social media audit to benchmarking our current position.

Increase engagement with our existing customers, and draw new audience- subsequently increase our customers base.

Test and learn about the community , in order to shape the future growth of social media audiences and increase application participation.

Goal & Objectives

We are aiming to achieve all the strategies mentioned, and this can be fulfilled as following:

Complete social media audit and implement actions arising from it.

Usage of more videos and photos with short textual posts.

Responding quickly and thoroughly.

Engaging through sports and health issues, to show suportness and careness.

Create group and community for our customers.

 

6. Business Model

6.1. Revenue streams

We are using the hybrid monetization model, this means the app is free, however there will be in-app advertisements, purchasing and paid subscription.  

Subscription/Purchasing

We have a special challenge where we offer one month premium for free. When the user runs a total of 75 km or more per month, the next month he/she gets premium subscription for free. This challenge will also promote the premium version of the app, users can try it for free and can then buy it. However, this is a one time only challenge, if the user succeeds in running the 75 km and receives the one month free premium, he cannot take part of this challenge again. By doing this, we can prevent the user from redoing this challenge each month,and eventually never pay for the premium. If the user immediately takes a subscription before doing this challenge, the challenge will still be available after the subscription has ended.

We conducted a market research to determine the price compared to our competitors. In the table below we can see the prices of our competitors. As we can see in the table, each app offers the basic part for free, however when we look at the premium prices we can see some differences. Runtastic actually offers three different premium subscriptions; one year (Stay Fit), six months (Make Progress), and 3 months (Get In Gear).

They all differ somewhat regarding monthly and annual subscription prices. The monthly subscription, which varies from €5,99 to €9,99, has an average price of € 7,75 p.m. The annual subscription, varying from € 29,99 to € 59,99, has an average of € 45.33 p.y.

COMPETITOR

BASIC

PREMIUM

Runkeeper

€0,-

€9,99 p.m.

€19,99 p.q.

€39,99 p.y.

Strava

€0,-

€7,99 p.m.

€59,99 p.y.

Endomondo

€0,-

€5,99 p.m.

€29,99 p.y. (€2,99 p.m.)

Runtastic

€0,-

Stay Fit - 1 yr

£44,99 (£3,32 p.m)

Make Progress - 6 mo

£29,90 (£4,98 p.m.)

Get In Gear - 3 mo

£19,90 (£6,63 p.m.)

We see Runkeeper as our biggest competitor and Strava as the second biggest, therefore  our prices have to be equal or less than theirs. That's why we chose to have a cheaper monthly price than Runkeeper and the same as Strava.

We will keep our prices max 20% lower than our biggest competitor (Runkeeper), because we are new to the market and we want runners to choose our app instead of our competitors.

For now we have the following prices for the premium subscription, we offer three different subscription types;

€ 7,99 per month

€ 31,99 per 6 months

€ 39,99 per year

By using three different subscription methods, users can make a better choice and choose the subscription type that suits them best. Additionally, our users are not immediately tied to a yearly subscription.

Having prices ending on 99 cents is a pricing/marketing strategy where we use the psychological barrier, this strategy is also known as psychological or charm pricing. People are more often tended to buy things when the price is 7,99 than when the price is 8,00. Since we read from left to right and people are cognitively lazy, our brains encode the entire number before we've read it all. That's why the first number people see changes their perspective and has the most influence. To emphasise this the decimal numbers are also displayed smaller:  €7,99

Using psychological pricing we can increase our average sales by almost 25% compared to when we use the close ‘rounded' price.

Advertisements

Affiliate marketing / partners  

We have deals with several partners and sponsors, like Whitings, Nike and Under Armour.

We will promote their products in ads, our youtube channel and the challenges where weekly and monthly top runners receive awards, which are offered by these top brands.

The in-app ads will be shown in the form of banners. They will also promote our app on their website.

Seasonal promotions / advertisements

We also have seasonal advertisements and promotions, related to when most runners decide to start running (again) or are likely to run. During the Christmas and new year season people often make new year resolutions, which most of the time also includes getting a healthier lifestyle. Additionally, most people run from the when the weather gets better in the spring till fall. These ads will be shown for instance on social media (e.g. Facebook)

6.2. Costs

The main costs will be the development, testing and marketing of the new Running app.

We have to acquire the necessary tools and people to develop and test the app, like software, hardware, software developers, etc. For marketing we should consider the cost to be between 12% and 20% of our expected/gross revenue.

Additionally, something to keep in mind is that loss before launch is very common and should be expected, since we already have expenses including tax before the launch but don't have any sales/income yet. Among the other expected costs are employee salary, tax, app maintenance and web hosting.

7. Sources

Ciotti, G. (2018, June 7). 5 Psychological Studies on Pricing That You Absolutely MUST Read. Retrieved June 2018, from Kissmetrics: https://blog.kissmetrics.com/5-psychological-studies/

Marketing Charts. (2017, August 2017). Which App Categories Appeal to Which Age Groups? Retrieved May 2018, from Marketing Charts: https://www.marketingcharts.com/digital/mobile-phone-79879

Sonders, M., & L., A. (2016, September 6). These fitness app statistics show what's going right (and wrong) for Fitbit. Retrieved June 2018, from Medium: https://medium.com/@sm_app_intel/these-fitness-app-statistics-show-whats-going-right-and-wrong-for-fitbit-da2c4c3be142

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