Samsung galaxy marketing plan pdf

APPENDIX 1

THE MARKETING PLAN: AN INTRODUCTION As a marketer, you will need a good marketing plan to provide direction and focus for your brand, product or company. With a detailed plan, any business will be better prepared to launch a new product or build sales for existing products. Non-profit organisations also use marketing plans to guide their fundraising and outreach efforts. Even government agencies develop marketing plans for initiatives such as building public awareness of proper nutrition and stimulating area tourism.

THE PURPOSE AND CONTENT OF A MARKETING PLAN A marketing plan has a more limited scope than a business plan, which offers a broad overview of the entire organisation’s mission, objectives, strategy and resource allocation. It serves to document how the organisation’s strategic objectives will be achieved through specific marketing strategies and tactics, with the customer as the starting point. It is also linked to the plans of other departments within the organisation.

Suppose a marketing plan calls for selling 200 000 units annually. The production department must gear up to make that many units, the finance department must arrange funding to cover the expenses, the human resources department must be ready to hire and train staff, and so on. Without the appropriate level of organisational support and resources, no marketing plan can succeed.

Although the exact length and layout will vary from company to company, a marketing plan usually contains the elements introduced in Chapter 1 and described in Chapter 3. Smaller businesses may create shorter or less formal marketing plans, whereas corporations frequently require highly structured marketing plans. To effectively guide implementation, every part of the plan must be described in great detail. Sometimes a company will post its marketing plan on an internal website, which allows managers and employees in different locations to consult specific sections and collaborate on additions or changes.

THE ROLE OF RESEARCH Marketing plans are not created in a vacuum. To develop successful strategies and action programs, marketers require up-to-date information about the environment, the competition, and the market segments to be served. Often, an analysis of internal data is the starting point for assessing the current marketing situation; this is supplemented by marketing intelligence and research investigating the overall market, the competition, key issues, and threats and opportunities. As the plan is implemented, marketers use a variety of research techniques to measure progress towards objectives and identify areas for improvement if the results fall short of projections.

Finally, marketing research helps marketers learn more about their customers’ requirements, expectations, perceptions and satisfaction levels. This deeper understanding is the foundation for building competitive advantage through well-informed segmenting, targeting, differentiating and positioning decisions. Thus, the marketing plan should outline what marketing research will be conducted and how the findings will be applied.

THE ROLE OF RELATIONSHIPS The marketing plan shows how the company will establish and maintain profitable customer relationships. It also shapes several internal and external relationships. First, it affects how marketing personnel work with each other and with other departments to deliver value and satisfy customers. Second, it affects how the company works with suppliers, distributors and strategic alliance partners to achieve the objectives in the plan. Third, it influences the company’s dealings with other stakeholders, including government regulators, the media and the community at large. All of these relationships are important to the organisation’s success, so they should be considered when a marketing plan is being developed.

Marketing plan

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FROM MARKETING PLAN TO MARKETING ACTION Companies generally create yearly marketing plans, although some plans cover longer periods of time. Marketers start planning well in advance of the implementation date to allow time for marketing research, thorough analysis, management review, and coordination between departments. Then, after each action program begins, marketers monitor ongoing results, compare them with projections, analyse any differences, and take corrective steps as needed. Some marketers also prepare contingency plans if certain conditions emerge. Because of inevitable and sometimes unpredictable environmental changes, marketers must be ready to update and adapt marketing plans at any time.

For effective implementation and control, the marketing plan should define how progress towards objectives will be measured. Managers typically use budgets, schedules and performance standards for monitoring and evaluating results. With budgets, they can compare planned expenditures with actual expenditures for a given week, month or other time period. Schedules allow management to see when tasks were supposed to be completed and when they were actually completed. Performance standards track the outcomes of marketing programs to see whether the company is moving towards its objectives. Some examples of performance standards are market share, sales volume, product profitability and customer satisfaction.

SAMPLE MARKETING PLAN FOR SONIC This section takes you inside the sample marketing plan for Sonic, a hypothetical startup company. The company’s first product is the Sonic 1000, a multimedia, network/Wi-Fi–enabled smartphone. Sonic will be competing with Apple, Nokia, Research in Motion, Motorola, Samsung, and other well-established rivals in a crowded, fast-changing marketplace for smartphones that combine communication, entertainment and storage functionality. The margin definitions explain the purpose and function of each section of the plan.

EXECUTIVE SUMMARY Sonic is preparing to launch a new multimedia, dual-mode smartphone, the Sonic 1000, in a mature market. Our product offers a competitively unique combination of advanced features and functionality at a value-added price. We are targeting specific segments in the consumer and business markets, taking advantage of opportunities indicated by higher demand for easy-to-use smartphones with expanded communications, entertainment and storage functionality.

The primary marketing objective is to achieve first-year global sales of 500 000 units. The primary financial objectives are to achieve first-year sales revenues of $75 million, keep first-year losses under $8 million, and break even early in the second year.

CURRENT MARKETING SITUATION Sonic, founded 18 months ago by two entrepreneurs with experience in the PC market, is about to enter the mature smartphone market. Multifunction phones, email devices and wireless communication devices are commonplace for both personal and professional use. Research shows that the worldwide smartphone market grew 54.7 per cent year-on-year in the fourth quarter of 2011, but there is still a lot of room for growth: though different research reports show different estimates, around 46 per cent of US consumers and 44 per cent of Western European consumers had a smartphone at the end of 2011. Thus, there is substantial room for new sales, both from sales to consumers buying their first smartphone, and to others updating their phone to one with more features.

Competition is therefore more intense even as demand flattens, industry consolidation continues and pricing pressures squeeze profitability. In late 2011, Samsung overtook Apple to become the leading smartphone supplier, with 20.0 per cent of the market, ahead of Apple with 14.5 per cent of the market. Nokia, the former leading vendor of phones, is third with 14.2 per cent, reflecting a large drop in market share of 36.6 per cent year-on-year. Research in Motion, which had dominated business phones with its popular BlackBerry phone, also lost market share, and had only 10 per cent of the smartphone market in 2011, a fall of 4.8 per cent in market share. To gain market share in this dynamic environment, Sonic must carefully target specific segments with features that deliver benefits valued by each customer group.

Executive summary This section summarises and

overviews the main goals, recommendations and points for

senior managers who will read and approve the marketing plan. For management convenience, a table of contents usually follows

this section.

Current marketing situation In this section, marketing

managers discuss the overall market, identify the market

segments they will target, and provide information about a

company’s current situation.

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MARKET DESCRIPTION Sonic’s market consists of consumers and business users who prefer to use a single device for communication, information storage and exchange, and entertainment on the go. Specific segments being targeted during the first year include professionals, corporations, students, entrepreneurs and medical users. Table A1.1 shows how the Sonic 1000 addresses the needs of targeted consumer and business segments.

BENEFITS AND PRODUCT FEATURES Table A1.1 clarifies the benefits that product features will deliver to satisfy the needs of customers in each targeted segment.

Buyers can choose among models based on several different operating systems, including systems from Microsoft, Symbian, BlackBerry and Linux. Sonic licenses a Linux-based system because it is somewhat less vulnerable to attack by hackers and viruses. Hard drives and removable memory cards are popular smartphone options. Sonic is equipping its first entry with an ultrafast, 20-gigabyte removable memory card for information and entertainment storage. This will allow users to transfer photos and other data from the smartphone to a home or office computer. Technology costs are decreasing even as capabilities are increasing, which makes value-priced models more appealing to consumers and business users with older devices who want to trade up to new, high-end multifunction units.

PRODUCT REVIEW Our first product, the Sonic 1000, offers the following standard features with a Linux operating system:

• Built-in dual network phone/Wi-Fi phone functionality and push-to-talk instant calling • Digital music/video/television recording, wireless downloading and playback • Wireless Web, email, text messaging and instant messaging

Market description Describes the targeted segments in detail and provides context for the marketing strategies and detailed action programs discussed later in the plan.

Product review The product review summarises the main features for all of a company’s products, organised by product line, type of customer, market and/or order of product introduction.

Targeted segment Customer needs Corresponding features/benefits

Professionals (consumer market)

• Stay in touch conveniently and securely while on the go

• Perform many functions hands-free without carrying multiple gadgets

• Built-in phone and push-to-talk feature to communicate anywhere at any time

• Wireless email/web access from anywhere • Linux operating system that is less vulnerable to

hackers • Voice-activated applications are convenient • GPS functionality and camera add value

Students (consumer market)

• Perform many functions hands-free without carrying multiple gadgets

• Express style and individuality

• Compatible with numerous applications and peripherals for convenient, cost-effective communication and entertainment

• Variety of smartphone cases

Corporate users (business market)

• Security and adaptability for proprietary tasks

• Obtain driving directions to business meetings

• Customisable to fit corporate tasks and networks • Linux-based operating system less vulnerable to

hackers • Built-in GPS allows voice-activated access to

directions and maps

Entrepreneurs (business market)

• Organise and access contacts, schedule details, and business and financial files

• Get in touch fast

• Hands-free, wireless access to calendar, address book, information files for checking appointments and data, and connecting with contacts

• Push-to-talk instant calling speeds up communications

Medical users (business market)

• Update, access and exchange medical records

• Photograph medical situations to maintain a visual record

• Removable memory card and hands-free, wireless information recording reduces paperwork and increases productivity

• Built-in camera allows fast and easy photography and stores images for later retrieval

Segment needs and corresponding features/benefits

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• 9 cm colour screen for easy viewing • Organisation functions, including calendar, address book and synchronisation • GPS for directions and maps • Integrated 4-megapixel digital camera • Ultrafast, 20-gigabyte removable memory card with upgrade potential • Interchangeable case wardrobe of different colours and patterns • Voice recognition functionality for hands-free operation

First-year sales revenues are projected to be $75 million, based on sales of 500 000 Sonic 1000 units at a wholesale price of $150 each. During the second year, we plan to introduce the Sonic 2000, also with a Linux operating system, as a higher-end smartphone product offering the following standard features:

• Global phone and messaging compatibility • Translation capabilities to send English text in other languages. (The purchaser will be able to choose one

option from Chinese, Spanish or French for free, with other languages available as add-on options.)

• Integrated 8-megapixel camera with flash

COMPETITIVE REVIEW The emergence of lower-priced smartphones has increased competitive pressure. Competition from specialised devices for text and email messaging, such as BlackBerry devices, is a major factor, as well. Key competitors include the following:

• Samsung. Value, style, function—Samsung is the market leader in smartphones and offers a variety of smartphones for consumer and business segments. Some of its smartphones are available for specific tele- communications carriers, and some are ‘unlocked’, ready for any compatible telecommunications network. Its newest smartphones, the Galaxy S series, are available through the major phone companies and feature the increasingly popular Android operating system, ‘Swype technology’, which Samsung claims offers texting at 50 per cent greater speed, a 10.9 cm AMOLED touch screen and a 5-megapixel camera. In the US, where Sonic intends to first launch, a Samsung Galaxy phone is available for $199 with a two-year contract, or $649 without a contract.

• Apple. Though trailing Samsung in unit sales, Apple leads the market in sales value. Its latest model, the stylish and popular iPhone 4S, offers a voice response ‘intelligent assistant’, which answers spoken queries. It also offers an 8.9 cm colour screen, is well equipped for music, video and Web access, and has communication, calendar, contact management and file management functions. Its global positioning system technology can pinpoint a user’s location, and users can erase data with a remote command if the smartphone is lost or stolen. The iPhone 4S is priced at $799 for the 16GB model, $899 for the 32GB model and $999 for the 64GB model, though the phone is also available at lower prices with a network contract.

• Nokia. The former market leader in phones and Smartphones, Nokia offers a wide range of products for personal and professional use. It purchased the maker of the Symbian operating system and made it into a separate foundation dedicated to improving and promoting this mobile software platform. Many of Nokia’s smartphones offer full keyboards, similar to Research in Motion models. Nokia also offers stripped-down models for users who do not require the full keyboard and full multimedia capabilities. However, Nokia’s most popular models are its older ones, suggesting that the brand is becoming less competitive.

• HTC. Along with Samsung, HTC has achieved large recent increases in market share, with its sales growing 115.3 per cent to capture fourth place in market share in late 2011. HTC’s success has been fuelled by acquisitions of several companies in 2011 to expand its offerings, including Dashwire for cloud-based sync, Zoodles for kid-oriented applications, and a stake in audio company Beats. The company also appears to be pursuing a segmented approach, with different recent launches targeted at specific segments, including the multimedia- optimised Sensation, female-oriented Rhyme and the entry-level Explorer. An HTC Trophy smartphone with a Windows operating system costs $429, or $299 with a two-year contract, though other HTC models are often offered free with a phone contract.

Competitive review The purpose of a competitive

review is to identify key competitors, describe their market positions and briefly

discuss their strategies.

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• RIM. Lightweight BlackBerry wireless multifunction products manufactured by Research in Motion (RIM) have been especially popular among corporate users, with the brand having a strong reputation for innovation and customer service. RIM introduced new smartphone models in late 2011, and its newest Blackberry, the Torch, is the company’s first touch-screen smartphone, including a full keyboard. Priced at $99 with a two-year contract, or $450 without a contract, the Torch 9860 competes with its iPhone and Android rivals, but the company lost 4.8 per cent in market share from 2010 to 2011.

Despite this strong competition, Sonic can carve out a definite image and gain recognition among the targeted segments. Our voice-recognition system for completely hands-free operation is a critical point of differentiation for competitive advantage. Also, offering GPS as a standard feature gives us a competitive edge compared with some competing priced smartphones. Moreover, our product is speedier than most and runs on the Linux operating system, which is an appealing alternative for customers concerned about security. Table A1.2 shows a sample of competitive products and prices.

CHANNELS AND LOGISTICS REVIEW Sonic-branded products will be distributed through a network of retailers. Some of the most important channel partners are as follows:

• Independent electronic retailers such as Best Buy, specialist phone retailers such as PhoneWorld, and Independent computer retailers such as Dick Smith will all carry Sonic products.

• Office supply superstores. Large office suppliers such as Officeworks will carry Sonic products in stores, in catalogues and online.

• Online retailers. Amazon.com will carry Sonic products and, for a promotional fee, will give Sonic prominent placement on its homepage during the introduction.

Initially, our distribution strategy will focus on major cities in the US, Europe, Australia and Asia; as demand increases, we will expand into smaller regional areas and new geographic markets with appropriate logistical support.

Channels and logistics review In this section, marketers list the most important channels, overview each channel arrangement, and identify developing issues in channels and logistics.

Competitor Model Features Price

Samsung Galaxy Social network integration; embedded GPS; 10.9 cm AMOLED touch screen; 5-megapixel camera; audio and HD video capabilities; Android operating system, memory slot card

$200 with two-year phone contract, or $649 without a contract

Apple iPhone 4S Sleek styling; 8.9 cm screen; intelligent assistant: fast internet functions; one-touch calling; GPS navigation; voice commands; integrated personal and corporate email; open and edit Microsoft Office files; 8-megapixel camera; no keyboard; Apple operating system

$199 for 16GB model; $299 for 32GB, $399 for 32GB, each with 2 year contract, or $799, $899 and $999 without contracts

Nokia E71 classic Quad-band for worldwide phone, email and internet access; monoblock with full keyboard; corporate and personal email integration; 6 cm screen; 3.2-megapixel camera; media player; Symbian operating system

Free with contract: $249 without phone contract

HTC Trophy 9.7 cm screen; 5-megapixel phone with auto focus and LED flash; Windows 7 operating system; preloaded with Xbox Live and Zune music system

$299 with two-year contract, or $429 with no contract

RIM BlackBerry Torch 9860

High-resolution, 9.4 cm touch screen display; slide-out full keyboard; wireless email and internet access; 5-megapixel camera with face detection and 4x digital zoom; built-in maps and GPS; 720p HD video recording; expandable memory; BlackBerry operating system

$99 with two-year contract, or $450 with no contract

Sample of competitive products and pricing

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STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREAT ANALYSIS Sonic has several powerful strengths on which to build, but our major weakness is a lack of brand awareness and image. The major opportunity is the demand for multimedia smartphones that deliver a number of valued benefits, eliminating the need for customers to carry more than one device. We also face the threat of ever-higher competition from consumer electronics manufacturers, as well as downward pricing pressure. Table A1.3 summarises Sonic’s main strengths, weaknesses, opportunities and threats.

STRENGTHS Sonic can build on three important strengths:

1. Innovative product. The Sonic 1000 offers a combination of features that would otherwise require customers to carry multiple devices: speedy, hands-free, dual-mode network/Wi-Fi telecommunications capabilities; GPS functionality; and digital video/music/television program storage and playback.

2. Security. Our smartphone uses a Linux-based operating system that is less vulnerable to hackers and other security threats that can result in stolen or corrupted data.

3. Pricing. Our product is priced lower than many competing multifunction models—none of which offer the same bundle of features—which gives us an edge with price-conscious customers.

WEAKNESSES By waiting to enter the smartphone market until some consolidation of its competitors has occurred, Sonic has learned from the successes and mistakes of others. Nonetheless, we have two main weaknesses:

1. Lack of brand awareness. Sonic has no established brand or image, whereas Apple and others have strong brand recognition. We will address this issue with aggressive promotion.

2. Physical specifications. The Sonic 1000 is slightly heavier and thicker than most competing models because it incorporates multiple features, offers sizable storage capacity, and is compatible with numerous peripheral devices. To counteract this weakness, we will emphasise our product’s benefits and value-added pricing, which are two compelling competitive strengths.

OPPORTUNITIES Sonic can take advantage of two main market opportunities:

1. Increasing demand for multimedia smartphones with multiple functions. The market for multimedia, multifunction devices is growing much faster than the market for single-use devices. Growth will accelerate as dual-mode capabilities become mainstream, giving customers the flexibility to make phone calls over network or Wi-Fi connections. Smartphones are already commonplace in public, work and educational settings, which is boosting primary demand. Also, customers who bought entry-level models are replacing older models with more advanced models.

2. Cost-efficient technology. Better technology is now available at a lower cost than ever before. Thus, Sonic can incorporate advanced features at a value-added price that allows for reasonable profits.

Strengths Strengths are internal

capabilities that can help a company reach its objectives.

Weaknesses Weaknesses are internal

elements that may interfere with a company’s ability to achieve its

objectives.

Opportunities Opportunities are external elements that a company

may be able to exploit to its advantage.

Strengths Weaknesses

• Innovative combination of functions in one portable, voice-activated device

• Security due to a Linux-based operating system • Value pricing

• Lack of brand awareness and image • Heavier and thicker than most competing models

Opportunities Threats

• Increased demand for multimedia, multifunction smartphones

• Cost-efficient technology

• Intense competition • Downward pricing pressure • Compressed product life cycle

Sonic’s strengths, weaknesses, opportunities and threats

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THREATS We face three main threats with the introduction of the Sonic 1000:

1. Increased competition. More companies are entering the smartphone market with models that offer some, but not all, of the features and benefits provided by Sonic’s product. Therefore, Sonic’s marketing communications must stress our clear differentiation and value-added pricing.

2. Downward pressure on pricing. Increased competition and market-share strategies are pushing smartphone prices down. Still, our objective of seeking a 10 per cent profit on second-year sales of the original model is realistic, even given the lower margins in this market.

3. Compressed product life cycle. Smartphones have reached the maturity stage of their life cycle more quickly than earlier technology products. We have contingency plans to keep sales growing by adding new features, targeting additional segments and adjusting prices as needed.

OBJECTIVES AND ISSUES OBJECTIVES We have set aggressive but achievable objectives for the first and second years of market entry.

• First-year objectives. During the Sonic 1000’s initial year on the market, we are aiming for unit sales volume of 500 000.

• Second-year objectives. Our second-year objectives are to sell a combined total of one million units of our two models and break even early in this period.

ISSUES In relation to the product launch, our major issue is the ability to establish a well-regarded brand name linked to meaningful positioning. We will invest heavily in marketing to create a memorable and distinctive brand image projecting innovation, quality and value. We also must measure awareness and response so we can adjust our marketing efforts as necessary.

MARKETING STRATEGY Sonic’s marketing strategy is based on a positioning of product differentiation. Our primary consumer target is middle- to upper-income professionals who need one portable device to coordinate their busy schedules, communicate with family and colleagues, get driving directions, and be entertained on the go. Our secondary consumer target is high school and university students who want a multimedia, dual-mode device. This segment can be described demographically by age (16–30) and educational attainment level.

Our primary business target is mid- to large-sized corporations that want to help their managers and employees stay in touch and be able to input or access critical data when not in the office. This segment consists of companies with more than $25 million in annual sales and more than 100 employees. We are also targeting entrepreneurs and small-business owners as well as medical users who want to update or access patients’ medical records while reducing paperwork.

POSITIONING Using product differentiation, we are positioning the Sonic as the most versatile, convenient, and value-added model for personal and professional use. Our marketing will focus on hands-free operation of multiple communication, entertainment and information capabilities that differentiate the Sonic 1000 from its competitors.

PRODUCT STRATEGY The Sonic 1000, including all the features described earlier, will be sold with a one-year warranty. We will introduce a more compact, powerful high-end model (the Sonic 2000) in the second year. Building the Sonic brand is an integral part of our product strategy. The brand and logo (Sonic’s distinctive yellow thunderbolt) will be displayed on the product and its packaging, and be reinforced by its prominence in the introductory marketing campaign.

PRICING STRATEGY The Sonic 1000 will be introduced at $150 wholesale/$199 estimated retail price per unit. We expect to lower the price of this first model when we expand the product line by launching the Sonic 2000, whose wholesale price

Threats Threats are current or emerging external elements that could potentially challenge a company’s performance.

Objectives and issues A company’s objectives should be defined in specific terms so management can measure progress and plan corrective action, if needed, to stay on track. This section describes any major issues that might affect a company’s marketing strategy and implementation.

Marketing strategy This section summarises the broad logic that will guide decisions made during the period covered by the plan.

Positioning Positioning built on meaningful differentiation, supported by appropriate strategy and implementation, can help a company build competitive advantage.

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will be $175 per unit. These prices reflect a strategy of attracting desirable channel partners and taking share from Nokia, HTC, Research in Motion and other established competitors.

DISTRIBUTION STRATEGY Our channel strategy is to use selective distribution, marketing Sonic smartphones through well-known stores and online retailers. During the first year, we will add channel partners until we have coverage in all major metropolitan markets and the product is included in the major electronics catalogues and websites. We will also investigate distribution through mobile phone outlets maintained by major phone carriers. In support of our channel partners, Sonic will provide demonstration products, detailed specification handouts, and full-colour photos and displays featuring the product. Finally, we plan to arrange special payment terms for retailers that place volume orders.

MARKETING COMMUNICATIONS STRATEGY By integrating all messages in all media, we will reinforce the brand name and the main points of product differentiation. Research about media consumption patterns will help our advertising agency choose appropriate media and timing to reach prospects before and during product introduction. Thereafter, advertising will appear on a pulsing basis to maintain brand awareness and communicate various differentiation messages. The agency will also coordinate public relations efforts to build the Sonic brand and support the differentiation message. To create buzz, we will host a user-generated video contest on our website. To attract, retain and motivate channel partners for a push strategy, we will use trade sales promotions and personal selling. Until the Sonic brand has been established, our communications will encourage purchases through channel partners rather than from our website.

MARKETING RESEARCH Using research, we are identifying the specific features and benefits that our target market segments value. Feedback from market tests, surveys and focus groups will help us develop the Sonic 2000. We are also measuring and analysing customers’ attitudes towards competing brands and products. Brand awareness research will help us determine the effectiveness and efficiency of our messages and media. Finally, we will use customer satisfaction studies to gauge market reaction.

MARKETING ORGANISATION Sonic’s chief marketing officer, Jane Melody, holds overall responsibility for all marketing activities. Figure A1.1 shows the structure of the eight-person marketing organisation. Sonic has hired Worldwide Marketing to handle national sales campaigns, trade and consumer sales promotions, and public relations efforts.

Marketing research This section shows how

marketing research will be used to support development,

implementation, and evaluation of strategies and action

programs.

Marketing organisation The marketing department

may be organised by function, as in this sample, geography,

product or customer (or some combination thereof).

Amelia Howard, Advertising Manager

Ron Hall, Promotion Manager

Tony Calella, Sales

Manager

Tiffany White, Regional

Sales

Viktor Chenkov, Regional

Sales

Carlos Dunn, Advertising

Analyst

Kate McConnell, Promotion

Analyst

Jane Melody, Chief Marketing

Officer

FIGURE A1.1 Sonic’s marketing organisation

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ACTION PROGRAMS The Sonic 1000 will be introduced in February. The following are summaries of the action programs we will use during the first six months of next year to achieve our stated objectives.

• January. We will launch a $200 000 trade sales promotion campaign and exhibit at the major industry trade shows to educate dealers and generate channel support for the product launch in February. Also, we will create buzz by providing samples to selected product reviewers, opinion leaders, influential bloggers and celebrities. Our training staff will work with retail sales personnel at major chains to explain the Sonic 1000’s features, benefits and advantages.

• February. We will start an integrated print/radio/internet advertising campaign targeting professionals and consumers. The campaign will show what functions the Sonic smartphone can perform and emphasise the convenience of a single, powerful handheld device. An associated campaign will promote the Sonic 1000 as a Valentine’s Day gift. The campaign will be supported by point-of-sale signage as well as online-only ads and video tours.

• March. As the multimedia advertising campaign continues, we will add consumer sales promotions, such as a contest in which consumers post videos to our website showing how they use the Sonic in creative and unusual ways. We will also distribute new point-of-purchase displays to support our retailers.

• April. We will hold a trade sales contest offering prizes for the salesperson and retail organisation that sells the most Sonic smartphones during the four-week period.

• May. We plan to roll out a major advertising campaign this month. Radio ads will feature celebrity voices telling their Sonic smartphones to perform various functions, such as initiating a phone call, sending an email, playing a song or video, and so on. Stylised print and online ads will feature avatars of these celebrities holding their Sonic smartphones.

• June. We will exhibit at a semiannual electronics trade show and provide channel partners with new competitive comparison handouts as a sales aid. In addition, we will tally and analyse the results of customer satisfaction surveys for use in future promotions and provide feedback for product and marketing activities.

BUDGETS Total first-year sales revenue for the Sonic 1000 is projected to be $75 million, with an average wholesale price of $150 per unit and a variable cost per unit of $100 for 500 000 units. We anticipate a first-year loss of up to $8 million on the Sonic 1000 model. Break-even calculations indicate that the Sonic 1000 will become profitable after the sales volume exceeds 650 000, which we anticipate early in the product’s second year. Our break-even analysis of Sonic’s first smartphone product assumes wholesale revenue of $150 per unit, variable cost of $100 per unit, and estimated first-year fixed costs of $32.5 million. Based on these assumptions, the break-even calculation is as follows:

$32 500 000 $150/unit – $100/unit

= 650 000 units

CONTROLS We are planning tight control measures to closely monitor quality and customer service satisfaction. This will enable us to react very quickly to correct any problems that may occur. Other early warning signals that will be monitored for signs of deviation from the plan include monthly sales (by segment and channel) and monthly expenses. Given the market’s volatility, we are developing contingency plans to address fast-moving environmental changes, such as new technology and new competition.

MARKETING PLAN TOOLS Pearson offers two valuable resources to assist you in developing a marketing plan:

• The Marketing Plan Handbook by Marian Burk Wood explains the process of creating a marketing plan and includes detailed checklists and dozens of real-world examples.

Action programs Action programs should be coordinated with the resources and activities of other departments, including production, finance and purchasing.

Budgets Managers use budgets to project profitability and plan for each marketing program’s expenditures, scheduling and operations.

Controls Controls help management assess results after the plan is implemented, identify any problems or performance variations, and initiate corrective action.

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• Marketing Plan Pro is an award-winning software package that includes sample plans, step-by-step guides, an introductory video, help wizards, and customisable charts for documenting a marketing plan.

Sources: Background information and market data adapted from Mark Brownlow, ‘Smartphone statistics and market share’, e-mail marketing reports, February 2012; IDC Worldwide Mobile Phone Tracker, 6 February 2012; Matt Gallagher, ‘BlackBerry gets smarter’, Red Herring, 3 August 2010, p. 5; Dan Moren and Jason Snell, ‘Meet the iPhone 4’, Macworld, August 2010, pp. 22–3; Walter S. Mossberg, ‘Galaxy phones from Samsung are worthy iPhone rivals’, The Wall Street Journal (Eastern Edition), 22 July 2010, pp. D1–D5; Hester Plumridge, ‘Nokia dials new number for success’, The Wall Street Journal (Eastern Edition), 21 July 2010, p. C16; Rich Jaroslovsky, ‘Motorola’s new mojo’, Bloomberg Businessweek, 12 July 2010, p. 72; Edward C. Baig, ‘Droid X marks all the right spots; Android phone could challenge iPhone 4’, USA Today, 1 July 2010, p. 3B; Arik Hesseldahl, ‘Nokia’s Kallasvuo: We must “move even faster”’, Businessweek Online, 17 March 2010, p. 1; Ginny Miles, ‘The hottest smartphones of the season’, PC World, September 2009, pp. 44–8; ‘Android smart phone shipments grow 886% year-on-year in Q2 2010’, , accessed August 2010. Additional information from HTC.com, Samsung.com, Apple.com, verizonwireless.com, all accessed April 2012.

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