Mini Marketing Plan- Organic Food Essay

I. Executive Summery Sunny Farm Organic Food Company is a small start-up company which is located in Dalian and now mainly focuses on the market of Northeast China. Sunny Farm sells many kinds of organic food which include grain, vegetables, fruits, dairy, spices, tea, and animal products. Nowadays, organic food’s share of food market is low, but it has a huge potential for development. How to compete and how to gain competitive advantage in this emerging market become the biggest challenges to the company. The primary marketing objectives are to improve the market channel, which can help goods flow more smoothly and reach more audience, and to maintain a good relationship with customers. Since Sunny Farm engaged in food market, which is indispensible in daily life, it is currently considered a business-to-customer marketer. The plan calls for Sunny Farm to engage and capture 20 percent of the Northeast China (three provinces) organic food market. II. Environmental Analysis Sunny Farm Organic Food was founded two years ago by entrepreneurs Calais Chen and Lizzie Zhang. Sunny Farm’s products reflect Calais’s and Lizzie’s passion for high-quality food and those products catch up with the trend of green life. Sunny Farm now has many counters in supermarkets and food shops of main cities, Northeast China. A. The Marketing Environment 1. Competitive forces. The competition in organic food is relative weak in northeastern region compared to middle and southern regions because only a few competitors exist. The competition within the food industry is intense but still, it’s a market with great potential. Ordinary food is the primary competitor and also the leader; it takes up more than 90percent of market share due to its lower price and mass production. And the less than 10percent market is divided among the existing firms. However, the new industry is developing and full of vigor, more and more competitors are expected to enter the market in the near future. 2. Economic forces. The whole economy environment is quite well. The former economic crisis had little impact on northeast China. People have more money to spend to live a higher standard life. Organic food may be a good choice. Even though its price is at least 30percent higher than same kind ordinary food, it has many incomparable advantages. Recent years, with the change in people’s concept of consumption, they are much more willingly to spend money related to health. 3. Political forces. No. 4. Legal and regulatory forces. In recent years, more attention has been paid to food safety due to negative news. Much legislation has been published to cope with such problems. However, the restrictions put on organic food is much strict than those put on ordinary food. COFCC (China Organic Food Certification Center) is responsible for certification, management, and inspection of organic food, supports for fostering organic food market. 5. Technological forces. Organic food is strong dependent on environment – soil, weather, sunlight, and artificial intervention. The quality of organic food is not as stable as mass produced industrial production.. A major emerging technological trend involves ecological agriculture model, which includes ecological farming, contract farming, food processing, clean energy, organic fertilizer, etc. 6. Sociocultural forces. In today’s society, people earn more and concern more about higher standard of living. Organic food starts getting popular and that fits an overall trend among middle-class Chinese toward buying high-quality products with greater nutritional value and better taste. Organic food also fits in other societal trends: a good choice of giving presents and the need of substantial development, for example. B. Target Market(s) As a company which has an advantage in the location, Sunny Farm must adapt to change and market dynamics, segment the market, enforce deep-processing and high-processing to satisfy the needs of personalized market. First of all, we should recognize who are willing to buy such expensive food, love to eat the foods, and take delight in talking about the foods at this stage. Nowadays, women take the responsibility for purchasing family food in most families and they dominant where does the market go. However, we divided organic food’s target market into women, children, vegetarian, elderly people, and gift markets. In these segmentations, women still play an important role because it’s women who usually buy food for children or elderly people. C. Current Marketing Objectives and Performance Sunny Farm’s main distribution channel is retailers, which include supermarkets and food shops. Currently, most of our customers learn our products by advertisements on local websites, magazines, or foretaste of our product on the counter. Sunny Farm offers discounts to members who buy products in the long-term. Customer relationship is crucial because customer has the publicity effect that advertisements couldn’t match. Most women are glad to share shopping and life experience; we found that part of our customers is introduced by friends or colleagues who bought our products. The company collects cash from retailers monthly and implements cash on delivery to online-ordered customers, thus our company has good control over cash flow currently. Sunny Farm takes up 10 percent of organic food market now and desires to double it in the following two years. Higher revenues and profits can help company improve products and services, thus attract more potential customers. III. SWOT Analysis A. Strengths 1. Sunny Farm Organic Food Company is located in Dalian, with organic farms in all three provinces, where have the most appropriate weather for plants/ fowls to grow (Three River Plain and Songnen Plain). Goods are delivered directly from farms to supermarkets, food shops, or customers to minimize pollution. 2. Organic food of our company has a high level of safety and quality. Pesticide, chemical fertilizers are strictly forbid to ensure its purity. Organic food will be prevailing in the food market in the foreseeable future. 3. Sunny Farm has a website that is designed concise and convenient. Online-ordered products could be sent within 8 hours within urban areas. The operation to order is very easy and we also offer telephone ordering. 4. Sunny Farm opens several of its organic farms to customers. Customers can have a deeper acknowledge of our products by seeing how we produce. B. Weaknesses 1. Organic food is prohibiting from addition of preservative, which gives Sunny Farm a great challenge to transportation because the freshness is very important for food. 2. The Sunny Farm’s food has higher price for is high cost which includes scientific research, transportation expense. The extremely strict regulation forced us to be accurate during the whole producing process. 3. Most of our foods are not as good-looking as those which contain many pesticides, fertilizer, and growth regulating hormone. Organic fruits and vegetables may have worm stings and smaller than ordinary ones. C. Opportunities 1. Organic food is gaining recognition from customers because increasing number of people is now aware of the importance of environmental protection. Recent issues of food safety, including melamine-tainted milk, tonyred egg, and clenbuterol pork, deepen consumer’s interest in organic food also. 2. Sunny Farm has already have 10percent of market share and those customers are precious. They can help company explore new customer resources. 3. Imported organic food is very expensive and many customers buy them before China’s local market has been developed. Sunny Farm’s products are not losing to imported food. D. Threats 1. Many customers choose vitamin pills or albumen powder to add nutrition to diet. These goods are easy to carry and have longer shelf life. 2. The cost of many links in the production chain is increasing, varying from production, collection, storage, to package. 3. Recent years, the cultivated area is decreasing sharply. Organic farms need enough lands to produce because they have to be far away from polluting factories. E. Matching Strength to Opportunities/ Converting Weaknesses and Threats 1. To maintain a desirable profit, Sunny Farm puts substantial effort on scientific research and helps company be more efficient. Price is an important criterion for customers. 2. Based on existing customers, who have a fine opinion of Sunny Farm’s product, we can explore potential customers to earn greater share of markets. 3. Sunny Farm plans to develop new product to meet with the changing needs with customers. For example, further process fruits/vegetables into dried one and satisfied the needs of office lady. IV. Marketing Objectives Sunny Farm Organic Food Company is in the business of helping people live a greener and healthier life. It has to overcome increasing cost and continue to improve the quality. Sunny Farm’s objective is to capture 20 percent of market share in the following two years and to have 80 percent of its customers indicate that they love the product and are willing to buy again. The following two years is extremely important for Sunny Farm’s future development. To accomplish the objective, we have more to do with scientific research to minimize producing cost, and improve the distribution channel to eliminate inefficient transportation. At the same time, we should increase sales by holding a public relations activity, and do sales promotions weekly in supermarkets. A good way to promote is to make our products more outstanding in the supermarket; sales force could negotiate with supermarket officials. Another good way is to contact an opinion leader and persuasive him/ her to give positive statement to our products. V. Marketing Strategies A. Target Market(s) Target Market 1: pregnant women. Their bodies are very sensitive to artificial chemicals and organic foods are safe and nutritious that would be great to help them go through the pregnant period and have healthy babies. Target Market 2: children. They are the hopes of family, parents and grandparents always try their best to afford a better living environment. The quality of food directly affects the children’s living quality and physical development. Target Market 3: young lady. Most Chinese young ladies are focus on whitening, losing weight, and they would spend much money on them. Organic product is natural and helps body eliminate toxicant. Target Market 4: gift market. Sunny Farm offers boxes loaded products which are aim at gift market. Organic food is the new trend. They are environmental-friendly and taste that donors will have â€Å"face† and recipients will feel novel. B. Marketing Mix 1. Products. Sunny Farm sells many kinds of organic food: grain, vegetables, fruits, dairy, spices, tea, and animal products. At the same time, Sunny Farm sells the idea of green life and sustainable development. 2. Price. Sunny Farm charges a comparative high price for is high-quality products. Our products worth that much. Once customers become aware of and experience the benefits of organic food, they would be generous to purchase. 3. Distribution. Sunny Farm use dual distribution. Customers can buy products from retailers like supermarkets and food shop and they can also order product online. (SunnyFarm. com. cn) 4. Promotion. Currently about 50 percent of customers reorder each month. Sunny Farm sent text messages or email to members monthly and members could accumulate points by buying product and redeem gifts in the year end. We should make sure that our new products can get enough attention. Holding a public relations activity is helpful. VI. Marketing Implementation A. Marketing Organization Sunny Farm is a customer-centered company and focuses its marketing efforts on satisfying customer’s needs. The company mainly has three teams: research team, sales team, and promotion team. Research team is responsible for uncovering new needs and develops new products. Also, this team should adjust existing system according to customers’ feedback. Sales force is responsible for increasing sales; they mainly focus on negotiation with market officials and shopkeepers. Promotion team is responsible for advertising and deals with customer relationship. Sunny Farm is a harmonious company. B. Activities, Responsibility, and Timetables for Completion All implementation activities begin at the start of 2013. By March 31, develop Customer Relationship Management. By April 30, survey existing customers and members to get more information and analyze the results. By June 31, start to contact with new customer for the current products. By August 31, develop a new product according to the former survey. By December 30, develop a plan that adjust the system and minimize unnecessary costs base on the yearly performance. VII. Evaluation and Control A. Performance Standards and Financial Controls A comparison between budget and actual expenditures will be included in the project report. The following performance standards and financial controls are suggested: The administrative expense should not greater than 5 percent of total expenditure. Each team is responsible for its own purpose as well as the common goal of company. Each team report financial expenditures quarterly of their project. The sales of new products will be evaluated to determine its future prospect. Cash flow should always be smooth. B. Monitoring Procedures A comparison between Sunny Farm’s actual performance and company’s objective is important to evaluate effectiveness. Following are monitoring procedures: Monitor click throughs, web page visits, and time spent on SunnyFarm. com. cn. to evaluate the online service. Monitor the effectiveness of member programs by assigning unique, customer-specific codes to each membership card. Track their buying. Compare budgeted and actual expense monthly within each team and company evaluates each team and the team director.