Managing Marketing and Repositioning at Slendertone - Assignment Example

Slendertone In what ways could the earlier marketing of Slendertone be considered a good example of the selling concept? In its earliest days, Slendertone was marketed through the use of distributors. This was done mainly because the company had limited resources, but also because company officials believed the use of distributors to market and sell their products was cost effective and quick. The company also relied on marketing the existing product line that had been ‘inherited’ through the acquired business that previously sold the products. The use of distributors to market and sell the existing product line freed up funds that allowed Slendertone’s leaders to reinvest much-needed capital into his small and risky business. As his distributors worked to develop export markets for Slendertone’s product line, leaders could focus on putting their limited resources to use focusing on better product development. Slendertone sold many of their products initially through mail order catalogues, advertisements in small publications, and even a few retail outlets like pharmacies. They also tried alternative marketing practices such as infomercials in France, where they were able to see immediate results. In addition, they used direct response advertisements in magazines and other types of publications and expanded their retail distributions to even more pharmacies and added sports stores. Slendertone tried a similar marketing campaign in Ireland, where they also used direct marketing techniques and infomercials. They switched their sales strategy from developing local distributors to seizing DR Television opportunities. They even noticed that their sales increased in retail outlets that were located in or around the viewing areas of their infomercials. The success of the French and Irish direct marketing and infomercial approaches led them to a marketing strategy that involved researching the globe to find opportunities to air infomercials in various different countries. However, costs were a constraint and they chose to target ‘home-shopping’ television companies as a means to save valuable funding. They signed a deal in 1995 with Direct Shop Limited. Their reasoning for doing so included the fact that Direct Shop broadcasted in 30 countries, their coverage spanned a variety of different markets, they took care of any and all negotiations that were required to take place with the television companies so that Slendertone did not have to, Direct Shop went ahead and bought the products from Slendertone before they were sold via the program, and Direct Shop was able to handle multilingual calls in bulk which allowed them to sell to a much wider audience. Most of the sales via this particular method were made in the country of England. When utilizing the former marketing strategy, four markets showed the most sales: French distributor, Irish direct, direct shop, and Columbian distributor. Retail sales were hard to make because the use of the product requires detailed instructions and the typical retail clerk was did not hold sufficient knowledge to effectively explain the purpose and use of the product to potential customers. The target market under the previous strategy primarily consisted of women between the ages of 25 and 55, as well as ‘rich segments’ including pre-nuptials, post-natals, and men of all age groups. It is believed that the direct approach was popular because it was self-financing, worked to develop a large customer database and brand name popularity for future products under the Slendertone name, and it provided privacy for customers who were concerned about buying the product in front of other individuals for fear of ridicule. a. Is BioMedical Research now adopting the marketing concept? Competition appeared in the mid-nineties, but the products were of poorer quality. Nonetheless, they caused problems in Slendertone’s marketing concept. As a response, Slendertone released cheaper, non-brand name products with a similar function where sales were falling in France. They also began selling to salons in Ireland so that those salons could provide professional treatments to their clientele versus the customer having to purchase the product for home use and learn how to use it themselves. In 1996, French sales began to decline and the company focused on the United Kingdom market. In the United Kingdom, most sales came from magazine advertisements and public relations activities. BioMedical Research is no longer using the same marketing concept. Under the old marketing concept, ultimately the direct channels were flooded with cheaper products, poor customer reviews hurt the sales, and competitors pulled out of the game giving the trade a bad name. The French distributor was dumped, as was Direct Shop. All the same, sales in the United Kingdom continued to grow. O’Donohoe was recruited away from Waterford Glass as the new Marketing Manager for Slendertone. b. How would you go about implemeting the marketing concept? I would start by focusing the product more carefully, just like O’Donohoe did. He developed a new slogan: ‘Living Life and Loving It.’ Just like he did, I would refocus the core goal of the product in my marketing efforts. He chose to focus on the meeting the need of the customer to look good. He discovered that customers in his target market care more about appearance than health. He also discovered that men were being largely overlooked and launched a product just for them. Since Slendertone was already well-known for having the best-quality product, it would also be a good idea to focus on the brand name. 2. What is the credibility issue for BioMedical Research? The company had what it referred to as a ‘gadget image’ to overcome. The product was placed alongside kitchen tools and the latest-and-greatest household tools and toys in infomercials, therefore giving it the appearance of being a fad type of product that people were skeptical of. The case even claims that, when market research was performed on the product after the sales declined in the mid-nineties, people admitted that their first reaction to the product when seeing it advertised was along the lines of “Does it actually work?” Many people did not buy it because they simply did not believe it worked and that it was a waste of their money. Others bought it and never purchased replacement pads, which in turn meant that they never or rarely used the product once they purchased it. a. Will the current strategy to re-position Slendertone resolve this issue? It is believed that the short-term, explosive growth of the product led to this issue, and the resolution is to reposition the brand by focusing on its name rather than its qualities: Slendertone. It is believed that this will work because of the consumer trials that were conducted to back up Slendertone’s claims. The new consumer trials helped to realize the benefits of Slendertone, as well as how to measure them. They also helped to identify ways to improve the convenience and overall comfort of the product. b. How else could the company enhance product / brand credibility? The company really needs to focus on getting rid of its gadget image. It needs to focus on quality instead of just another piece of exercise equipment to never use and toss in the closet. Focusing on the brand name ‘Slendertone’ will significantly aid in getting rid of this image by fostering an image of quality, reliability, and results. 3. There are other important issues which the company needs to consider in its plans to develop Slendertone into a world-class product, they are 1) Product usage, 2) Safety/Side-effect, 3) Low Quality Competitors / Poor Product-Class image, Threat of Multi-national activity. 4) Transferability of the Brand. a. How well does the current marketing strategy address these issues? O’Donohoe first placed his focus on building retail relationships in an effort to reposition the company. He thought there was a great untapped market in the retail sector and he hoped to capitalize on it. In an effort to discover why sales were falling so rapidly for the product in its existing markets, he chose to ask. He performed extensive market research in various markets and discovered that Slendertone never even was the market leader in France where the company had placed so much hope following its initial success in that market. He also discovered that Slendertone suffered from confused positioning. The product was positioned among a variety of categories, including the following: dieting, weight loss, health, fitness, exercise, toning, and body shaping. It had no focus on any particular category when it came to marketing efforts. Retailers did not even know what section to put the product in on their store shelves, some placing it in cosmetics and others in the exercise equipment section. The new marketing strategy creates an entirely new image of the Slendertone family of products for the customers. These products flaunt ease of use, reliability, safety, high quality that is measurable, a strong brand name, and lots of potential for new products underneath the umbrella of that brand name. It targets both men and women on a relatively equal scale and within the age group of 20-50. Slendertone and its group of products are now in the position to create a global brand that is able to enjoy a high level of success. The company has switched away from overselling and, thus, appearing as producing products that are part of a fad and instead focused more on realistic results. All products have been renamed to contain the word ‘Slendertone.’ Finally, they are now focusing strongly on solid brand identity. Read More