Executive Summary of the Ignition Digital Marketing Consultancy

Ignition Inc. is a digital marketing consultancy firm aimed at providing digital marketing solutions to individual clients, small businesses, and large enterprises. The services provided by business include development of marketing plans, optimisation across marketing channels, selection of adequate marketing methods, tactical implementation plan, and search engine optimisation in Australia. Ignition Inc. will operate in the industry of digital marketing as a sole proprietorship, managed by a CEO and a team of executives. The industry is quite profitable and presents opportunities. Total available market (TAM) for the industry is AUD 8.8 billion while Serviceable available market (SAM) is AUD 500 million. Serviceable obtainable market (SOM) for Ignition Inc. is AUD 2 million within the next two years and AUD 5 million within next four years.

Ignition Inc. will be focusing on individual clients, small businesses, and established companies. While the business will be headquartered in Australia, services will be offered both in Australia and other neighbouring nations because over the web, solutions are not limited by geographical boundaries. Small and large businesses account for 98 percent of all businesses in Australia. Since 2016, the number of businesses has increased 5.5 percent in Australia. These statistics determine that the target market for Ignition Inc. has a lot of potential and it is capable of providing consistent revenues to the business.

The most important features of services offered by Ignition Inc. include the use of advanced analytics and technologies for guiding employees with real-time feedback at a cost lower than that of competitors. As it has been explained above, target audience requires effective services at a cost that does not adversely influence their business. Such services are offered by Ignition Inc. for gaining a competitive edge and profits in the market.

For Ignition Inc., there are no internal risks other than the possibility that employees might experience some difficulties while working remotely. However, it is important to note that there are some external risks such as increased competition in the market and increased economic fluctuations due to recent disruptive circumstances. Ignition Inc. Ignition Inc. will continue to provide efficient services to customers for maintaining its competitive edge in the market. Melbourne, Australia has been selected for Ignition Inc. as the location. This location has been selected because it provides several advantages to the business. For instance, there are many small and large businesses situated in it. Furthermore, it provides access to all the important supplies and resources which are required for the development of business.

Business Background of the Ignition Digital Marketing Consultancy
Company of the Ignition Digital Marketing Consultancy

Ignition Inc. is a digital marketing consultancy firm aimed at providing digital marketing solutions to individual clients, small businesses, and large enterprises. The services provided by business include development of marketing plans, optimisation across marketing channels, selection of adequate marketing methods, tactical implementation plan, and search engine optimisation in Australia (Wertime & Fenwick, 2011).

Industry of the Ignition Digital Marketing Consultancy

Ignition Inc. will operate in the industry of digital marketing as a sole proprietorship, managed by a CEO and a team of executives. The industry is quite profitable and presents opportunities. Main competitors in the industry include Mayple and WebFx as they are considered the industry leaders.

Porter’s Five Forces of the Ignition Digital Marketing Consultancy

It is important for every industry to have a detailed review of various elements so that things can be analysed from an overall perspective. For this purpose, Porter’s Five Forces model is used as a tool to get some analysis of the industry. In the digital marketing and communication industry, the rivalry is very high because of many giants working in this industry. As far as the threat of new entrants is concerned, it is medium because it is not easy to establish a digital marketing business when the market is already giving tough competition. The bargaining power of suppliers is also medium because companies can have various options for using digital tools. However, the threat of substitute is on the higher side, because clients have so many digital marketing companies to choose from. They have so many options ranging from small to large size digital marketing enterprises. That’s why the bargaining power of buyers is also high as they have various options otherwise (See Appendix)

Market Attractiveness

Target Market of the Ignition Digital Marketing Consultancy

The objective of Ignition Inc. is to offer exceptional consultancy services at affordable costs, which places the firm in both competitive and budget markets. This specific market position is determined appropriate because competitors in the industry provide similar services at high costs, which places Ignition Inc. at a competitive advantage. TAM for the industry is AUD 8.8 billion while SAM is AUD 500 million. SOM for Ignition Inc. is AUD 2 million within the next two years and AUD 5 million within next four years.

Target Customers of the Ignition Digital Marketing Consultancy

Ignition Inc. will be focusing on individual clients, small businesses, and established companies. While the business will be headquartered in Australia, services will be offered both in Australia and other neighbouring nations because over the web, solutions are not limited by geographical boundaries. Small and large businesses account for 98 percent of all businesses in Australia. Since 2016, the number of businesses has increased 5.5 percent in Australia. These statistics determine that the target market for Ignition Inc. has a lot of potential and it is capable of providing consistent revenues to the business. In recent times, with the emergence of several digital marketing consultancy agencies, businesses seek efficient services at affordable costs, which provides an opportunity to Ignition Inc. The primary target audience for business is small and large businesses in Australia while secondary audience is small and large companies in neighbouring nations (Burns & Dewhurst, 2016).

Market Research and Analysis of the Ignition Digital Marketing Consultancy

It is determined that this industry will grow 14.9 percent over the next five years. In addition to it, it is also predicted that many new businesses are expected to emerge, which might increase the competition. These statistics indicate that the industry is going to be profitable in the future because more and more traditional businesses will consider the utilisation of digital media for marketing and reaching their audience, and building online presence. It is vital to keep in mind that digital presence is increasing in every business and industry. So, potential for digital marketing business is huge, and it is growing with the passage of time. The businesses are realizing that they cannot survive in this modern era without the help of digital marketing because companies have great digital presence and marketing strategy is doing better in so many ways. Many research and surveys have predicted that digital marketing is the way forward for business if they want to get competitive advantages (See Appendix)

Marketing Strategy of the Ignition Digital Marketing Consultancy

In order to target customers, a hybrid marketing strategy is considered which includes both the use of digital media and electronic media (See Appendix). For instance, social media platforms are selected for building online presence and gaining the attention of customers while Television and radio advertisements are considered for targeting individual customers. In this manner, small and large businesses, and individual people will be targeted. For the maintenance of customer relationships, a dedicate page on Facebook will be created. On this page, customers will be able to post their queries and interact with others. All the queries will be answered and it will serve to establish communication between the business and the customers. It is in this manner that customer relationships will be maintained. Furthermore, by providing them with affordable solutions, their loyalty will be acquired. Loan-to-Value is set in such a manner that loan is covered and profits are still produced (Coviello, 2010).

Marketing Plan of the Ignition Digital Marketing Consultancy

As it has been explained above, TAM for the digital marketing consultancy industry is AUD 8.8 billion. SOM for the industry is AUD 2 million within the next two years. It means that even though it will take a couple of years for Ignition Inc. to thrive in the market, eventually 10 percent of the market share will be acquired by the business. The largest barrier to market is competition which will be overcome by offering high quality services at affordable costs. Digital marketing has become critical for large, small businesses, and individual people for selling their services and products to customers. In fact, with the right strategies, it is possible for businesses to remain competitive and profitable within the industry for a long time. Thus, they rely on digital marketing for building strong relationships with their customers and target audience. They require effective marketing consultation for ensuring their success at affordable costs, which motivates them to buy and this opportunity will be exploited by Ignition Inc.

Current Demand of the Ignition Digital Marketing Consultancy

The current demand of digital marketing is quite high across the globe. The organisation today needs digital marketing so that they can reach a number of customers. With digital marketing the organisation has enhanced their competitive edge over the competitors. At present, the demand of digital marketing has grown significant. In fact, a large number of businesses are relying on digital marketing for improving their sales and presence over the web. It enables them to reach their customers or target audience in a significant and more efficient manner. However, since most businesses are not aware of how to utilise digital media channels, they make the use of digital media consultation for strengthening their online footprint.  

Protecting Market of the Ignition Digital Marketing Consultancy

The largest barrier to market is competition which will be overcome by offering high quality services at affordable costs. Digital marketing has become critical for large, small businesses, and individual people for selling their services and products to customers.

Unique Value Proposition
Products and Services of the Ignition Digital Marketing Consultancy

The most important features of services offered by Ignition Inc. include the use of advanced analytics and technologies for guiding employees with real-time feedback at a cost lower than that of competitors. As it has been explained above, target audience requires effective services at a cost that does not adversely influence their business. Such services are offered by Ignition Inc. for gaining a competitive edge in the market. There are a number of benefits that will be gained by customers including: real-time consultation, consistent solutions, data backed by advanced analytics, and cost-effective services.

One of the major benefits obtained by customers is that they will be guided on how and which channels can put them ahead of their competitors. As it has been explained above, the most compelling reason to buy from Ignition Inc. is that advanced digital marketing solutions will be offered at affordable costs.

Competition of the Ignition Digital Marketing Consultancy

There are two major competitors in the industry of digital marketing consulting including Mayple and WebFX. Both of these digital media agencies provide clients with diversified services ranging from website development to website optimisation and social media advertising across different social media platforms. It would not be wrong to say that both of them are considered market leaders and they have a significant market share in digital marketing. Beating them in terms of competition is not easy but they have a weak point which will be exploited by Ignition Inc. The business has advantage over these companies as they provide customers with highly priced services. Although they provide efficient services and solutions to customers, these solutions are overly priced which is not affordable by customers and most of them leave due to it. Meanwhile, Ignition Inc. will provide the same quality and technology standard but at a significantly affordable rate. This will help in the attraction of customers and will also help in the development of brand loyalty among customers. Even though this strategy causes the business to grow sales at a slow pace, it is beneficial in the sense that loyal customers will be developed by this strategy and it will prove to be very beneficial in the long-term (Kirzner, Competition and entrepreneurship, 2015).

For every new business, it is considered critical to define the unique selling proposition as it helps in determining how customers will be attracted and whether its products or services have the potential of selling them or not. In this case, the Unique Selling Proposition for Ignition Inc. is its affordable yet high-quality solutions. This provides the business with a competitive edge as well. Even though the competition is intense in the market, this unique proposition presents a significant opportunity for the business to gain its customer and become competitive in the market.

Brand of the Ignition Digital Marketing Consultancy

Digital marketing has become an important component of every organisation to become successful and thrive in the industry. After all, it is more than just a little effective in facilitating the reach of businesses towards their customers. However, making the use of digital media is not as simple as it appears. It is quite complex and this presents significantly challenges for businesses as they do not have an understanding of how digital marketing works and how effective results can be produced. Therefore, they seek high-quality solutions that can improve their online presence and their reach towards their customers. While they seek quality, they also seek cost-effective solutions. There are a number of digital marketing consultancy firms that are providing high-quality solutions to customers but these solutions are very costly. In fact, most customers turn back due to the costs and they end up recruiting in-house digital marketing experts (Brush, 2012).

Ignition Inc. is meaningful in the sense that it provides customers with both high-quality and advanced solutions and affordable rates. Customers will be able to get advanced solutions within their comfortable budget. Lower costs have been set for the solutions because it will help in the acquisition of customers and it will also help in the development of loyalty among these customers.

Price & Value Combination of the Ignition Digital Marketing Consultancy

Customers will be attracted by this unique combination because there is not even a single consulting agency that provides advanced analytics and real-time consultation at a cost that is lower than its competitors. In contrast, Ignition Inc. provides these aspects and gains a competitive advantage in the market. Not only the services are offered in competitive prices but also the services make the business to standout in the market.

Revenue Model
Margins of the Ignition Digital Marketing Consultancy

a.       Ignition Inc. will derive its revenue streams from its consulting solutions aimed at small and large businesses, and individual clients. The type of revenue stream generated is Fees for Usage because customers will be required to pay for consulting services. For instance, whenever a client requires digital marketing consultation, he will need to pay for the service. There will be a variety of ways to collect money from customers. The only and primary payment collection method will be used through online payment channels such as banks, digital payment channels, etc. There will be no cash collection directly from clients, keeping exception cases aside. So, the money will be collected through online channels, and it will be made sure that maximum channels are included in the list to facilitate clients as much as possible.

b.      Key point indicators will be the metrics utilised for monitoring revenues. Monthly sales will be measured and this will help significantly in determining whether profits are being made by the business or not and whether monthly sales will add up to meet the expected revenue standards or not.

c.       As it can be seen in the above graph, gross margins are quite attractive. Every other month, sales are expected to grow due to the unique proposition offered by Ignition Inc. The same applies to net margins as well. Both gross and net margins are quite attractive they serve to make it possible to achieve revenue goals of AUD 2 million in the first year and AUD 5 million in four years.

d.      In comparison with the competitors, this margin is not that significant. However, if it compared against their initial years then it would be determined that these margins are quite attractive.

e.       In fact, building on them, it is possible for Ignition Inc. to be a lot profitable in the coming years. Thus, it would not be wrong to say that the business is profitable in the industry.

f.        Customer payment policies restrict the use weak security and promote the use of eligible payment methods. In addition to it, it also promotes confidentiality. These policies are standard and they are necessary to be followed. Meanwhile, some policies require payment to be delivered back to customers in case expected results are not produced. These policies are industry expected and these policies will also be followed to ensure transparency (Dimitratos, Voudouris, Plakoyiannaki, & Nakos, 2012).

Cost Advantage of the Ignition Digital Marketing Consultancy

For reducing costs, experienced employees will be recruited and they will be encouraged to work remotely. This strategy of remotely working will cut down operational costs significantly. For instance, there will be no need of hardware and all employees can be managed from the office.

There are no fluctuations in supply costs because supplies are limited and it ensures that there are no fluctuations. It is important to note that since services provided are intangible, there is no need of suppliers and vendors. Services can be delivered directly over the web.

Price is quite a competitive factor and that is what provides Ignition Inc. with an advantage in the market. Furthermore, the employed cost model ensures that costs are not higher than the predetermined budget for the month.

For monitoring payables, automated software with alerts is utilised. It helps in ensuring that payables are delivered timely (Group, 2019). It is important to mention that in this early stage of the business, the purchasing power will not be high because it will take time for business to make a strong position in the market. But several efforts will be made to have a superior purchasing power in the future.

Moreover, it is also vital to attain cost advantages by having an eye on the cost of customer acquisition (CoCA). It means when a customer is acquired, certain costs may have been sustained by a company to get a customer. The strategy to calculate CoCA for the Ignition Inc. will be to add marketing costs along with the sales, and then the new number of customers will be taken to divide it, and it will provide an average and rough idea of CoCA.

Financials of the Ignition Digital Marketing Consultancy

The overall budget for Ignition Inc. is AUD 500,000. From this amount, AUD 400,000 has been obtained from multiple vendors and only a little amount is obtained from bank, and this amount has been invested in the development of Ignition Inc. From this amount, the necessary taxes will be paid, approvals for the business will be obtained, headquarter will be developed, and other operational costs will be covered. It can be said that all expenses will be covered from this amount and the remaining amount will be kept for covering external expenses. It has been determined that in the coming years, the probability of loss is quite. However, even if there are losses, a specific amount is kept separate for ensuring that losses can be covered even if they are incurred.

a.       In order to attract customers quickly, penetrative pricing strategy is selected and utilised in Melbourne. This will enable Ignition Inc. to quick target its customers and attract them to sell its services.

b.      Meanwhile, competitors make the use of premium pricing strategy.

c.       Comparative advantage is given by it as there is a significant difference in costly and affordable services offering the same quality standard.

d.      The sales objective of Ignition Inc. is to acquire AUD 2 million in the next two years.

e.       The main driving force behind sales forecast is loyal customer base that will stick with Ignition Inc. and continue to purchase services from it. The forecast of sales determines that revenue goals can be achieved effectively.

f.        Diverse sales techniques will be used for ensuring that sales objective is accomplished.

g.      Advanced skills are needed by sales operatives because they will need to make the use of automated software for recording and forecasting sales.

h.      The main threat that will exist to the sales target in the near future is the entry of more competitors. Obviously, when new competitors will enter the market, they will target the same audience and it will adversely influence Ignition Inc. In order to overcome this challenge, it would be considered critical for Ignition Inc. to ensure that effective strategies are created which offer a unique advantage to the business and ensure that customers remain loyal to the business (Fernhaber, Gilbert, & McDougall, 2014).

Sustainability
Sustainable Competitive Advantage of the Ignition Digital Marketing Consultancy

Making the use of digital media is not as simple as it appears. It is complex and this presents significantly challenges for businesses as they do not have an understanding of how digital marketing works and how effective results can be produced. Therefore, they seek high-quality solutions that can improve their online presence and their reach towards their customers. However, it is not possible for customers to continue to purchase costly solutions. Thus, they require cost-effective solutions and Ignition Inc. will offer a penetrative pricing strategy for obtaining competitive advantage. This advantage can be protected if proper strategies are implemented. There are many digital marketing consulting firms in Australia. However, all of them seem to provide services at costly rates. By ensuring that only cost-effective rates are being provided to customers, this competitive advantage can be protected.

The protection of competitive advantage in the market is considered very important because it ensures that the firm remains profitable in the market. If advantage is lost by the company, it would not be possible for it to continue selling its services to customers and attracting them. In fact, competitive advantage is lost in the market, it would result in loyal customers switching to other competitors and purchasing services and other solutions from them (Barney & Hesterly, 2010).

Innovation Factor of the Ignition Digital Marketing Consultancy

For Ignition Inc., innovation is considered quite important because that is what makes services comparable to services offered by competitors. For instance, if innovation is not there, it would not be possible for the business to offer high-quality services to clients. For the encouragement and implementation of innovation, team-based meetings are held in which employees are promoted to think freely and no idea is restricted. Any type of idea and strategy is welcomed and this will enable Ignition Inc. to practice innovation. This innovative ability is better than that of competitors because even though competitors provide customers with high-quality services and solutions, these solutions are not innovative. For ensuring that innovation is protected even in the future, AI-based solutions will be provided to customers. Data enhanced with artificial intelligence is quite helpful in creating digital marketing strategies. These solutions will be offered in the near future to ensure that innovation is not only practiced but also provided to customers.

Risk Avoidance of the Ignition Digital Marketing Consultancy

For Ignition Inc., there are no internal risks other than the possibility that employees might experience some difficulties while working remotely. However, it is important to note that there are some external risks such as increased competition in the market and increased economic fluctuations due to recent disruptive circumstances. Ignition Inc. is sensitive to these external risks and it is critical for risks to be overcome to ensure success and effectiveness in the market. In order to resolve these challenges, Ignition Inc. will have to continue providing efficient services to customers for maintaining its competitive edge in the market. However, as far as contingencies are concerned, the company should remain proactive because any kind of unforeseen situation can come in their way. There are always uncertain and unexpected risks, which are faced by companies, and Ignition Inc. will have to remain careful in this regard.

Exit Strategy of the Ignition Digital Marketing Consultancy

The ability to exit gracefully exists for Ignition Inc. and the business is also easily transferable due to its intangible nature. For instance, it can be transferred to investors. There would be a need of an exit strategy when the business objectives have been accomplished and there are profitable opportunities in other ventures. For the identification of harvest opportunities, situation can be analysed and the market can be forecasted. It will help in providing insights about harvest opportunities. Transferring to investors is considered only because otherwise, a financial loss would have to be experienced. It is also vital to keep in mind that several exit strategies are available, which can be used for the business. For instance, the company can opt for a merger with any other firm, working in a similar field. Initial Public Offering (IPO) is another way to be used as an exit strategy. If things have not gone well, then liquidation can be another option to exit.