Marketing for a Local Entrepreneur Planning - Report Example

HEALTH AND FITNESS BUSINESS IN HERTFORDSHIRE INTRODUCTION Health and fitness awareness and consciousness has given rise to the health and fitness industry in the world. According to Savills Research (2014), the growth in the UK health and fitness industry is on the rise. The glimpse of the industry growth is given below: (Health Club Management, 2013) Along with the growth, the industry has also exploring varying trends. For example, the budget sector is growing its contribution in the public and private sector. The constant growth in the UK health and fitness industry is also reflective of the people’s growing attention towards the improved health. This report is aimed at developing research based recommendation to an individual investor for opening services in health and fitness industry in the east of England state of Hertfordshire. The report will be based on the secondary research, and recommendations will be made for the business set-up and respective marketing planning in order to ensure the successful conduct of the venture. PROJECT REVIEW An individual investor aims to invest in the health and fitness industry in the state of Hertfordshire. The investor has limited the amount of money at disposal around £250,000. With a limited amount of money, the investor aims to initiate a small venture with limited product and/ or services. Also, the investor intends to develop a comprehensive plan in the light of the secondary research. Hertfordshire is located at a distance of 20 miles from London and is located in the south east of England (Hertfordshire County Council, n.d.). The state has its own attraction for the residents and tourists for its identity that is unique due to the blend of traditional and modern places (ColtsFoot, 2014). EXTERNAL ENVIRONMENT ANALYSIS Businesses operate in a certain environment. The external environment of the business is dependent on the multiple factors and impact of these factors is beyond the control of the business. Therefore, evaluation of the external environment is conducted in a systematic manner using strategic management tool of PESTEL. In order to initiate business, the PESTEL analysis of Hertfordshire is conducted as follows: PESTEL POLITICAL The Hertfordshire Country Council in collaboration with the central government has developed complete system to guide the business start up. The council has recently received considerable criticism from the politicians in guiding the younger generation for their career (Halkon, 2014). ECONOMICAL Hertfordshire is the sound economy; however, since the recent past, its growth was over affected by the recent economic downturn (Hertfordshire’s Economic Outlook, 2011). The revival efforts are under way, and a comprehensive strategy has been devised and implemented by the Hertfordshire Works Partnership for the promotion of the Hertfordshire as a good place for doing business (Hertfordshire Works, 2010). SOCIAL The population size of Hertfordshire is 1,129,100 as of 2012 (Hertfordshire County Council, 2012). The population projected from 2010 to 2035 has revealed a similar pattern with highest population segment of people of between age 40 to 50. The younger generation is smaller in number and most importantly, the age group of 20-24 is lowest with 30,000 population sizes.People in Hertfordshire are highly health conscious as evident from the large number of health and fitness clubs doing successful in the state. The clubs and other service providers are constantly innovating ideas to the people in Hertfordshire. TECHNOLOGICAL Due to high technological advancements, people are becoming more experimental and demanding in the field of health and fitness in Hertfordshire. It is becoming increasingly important that the business must possess latest technological tools and equipments and training to use them effectively, in order to be competitive in the market. LEGAL The safety and health legislation in Hertfordshire are restrictive as well as ample. Implying the laws and regulations of health and safety sector is necessary to operate soundly and increase customer base. Taxes, employment law, and other paperwork requirements are necessary to compile. ENVIRONMENTAL Environmental issues are the main concern when dealing in health and fitness sector. Company must undertake actions that support environmental growth and avoid dangerous substances like cleaning chemical (chlorine usage), massage oils, etc. People of Hertfordshire are health conscious and are more likely to use environmental friendly approaches to maintain health, for which they are willing to pay a premium. COMPETITIVE LANDSCAPE The health and fitness industry is growing in UK; however, despite, increased readiness of the customers to pay for their health and fitness, the landscape of the industry is getting competitive with every passing day. Similarly, the competitive landscape at the Hertfordshire is considerable competitive. This can be ascertained from the fact that directory of the state provides listing of around 1175 businesses that are facilitating the sports activities. These listings include direct and indirect competitors as includes all businesses offering range of services (Hertfordshire, n.d.). Furthermore, the list of service providers along with the services offered to customers reveals that the gym facilities are provided by almost all the related businesses in Hertfordshire. Importantly, among the service providers the services are being facilitated to both genders. Also, competitors are increasingly focussed on building their regular clientele. For the purpose, the customers are offered different ranges for the memberships. Also, the competitors are more inclined towards featuring their services in an exclusive manner to win the customers and their loyalty. INTERNAL ENVIRONMENT MARKETING MIX: Product: The business has widely focused on a variety of services that will be offered to potential customers. It provides services to women of Hertfordshire with numbers of facilities and provisions such as aerobics, pool, sunbeds, food, bar, gym, squash and other indoor games. There can be seen increasing trend of workout and aerobics among the women of Hertfordshire. Price: Prices are set at lower rates than other gyms in the region and other hotels that are providing gym services to their female guests. People of the middle class are price sensitive and prefer products and services that are available at lower prices. Lower prices than competitors will give a business an edge over its competitors. Place: The business’s central focus to initiate its operation is Hertfordshire. The potential market of the company will include; female students, youngsters, and people concerned with health and fitness issues. Moreover, it is aiming to provide a variety of services at lower prices in morning and evening timings. Promotion: The promotional strategy undertaken by this business is brochures, pamphlets, word of mouth, social media sites, facebook page. In this way, Business can minimize its cost, which will ultimately give an edge over others. BCG MATRIX The business comes under the “Question Mark” level because it is just being introduced to our target market and will take time to move to other levels. The business is at initial level, due to which it possess very low market share. However, the prospect of business growth is high as an industry is likely to boost in the future. Market Stage The health and fitness industry is at its introduction Stage in Hertfordshire. It’s a new market and a new trend to hire fitness consultants and setup gyms and fitness centres in the city of Hertfordshire. People are increasingly conscious about fitness and healthy life, and tend to workout daily by taking time from their daily routines. Especially in the middle class this concept is totally new. This Industry yet has to struggle a lot to expand, but few leaders are penetrating well that means passionate people can easily opt for this market as there are good reasons for this industry’s growth in the future. If unsure about the clients then one can take a start from a small level by simply setting up small business or providing individual based service. Moreover, Hertfordshire is a developing region where services are yet consumed by the upper class mostly. Demand Cycle As the life style of people of Hertfordshire is changing, people are more concerned about their health and fitness. The demand for fitness centres is increasing day by day. People are mostly tending to take out time for exercise and workout daily after working hours. PERCEPTUAL MAP Business, in order to gain success, is required to consider a wide range of factors. One of the most important aspects of such factors includes the perception of the business in the minds of the customers. Wilson and Gilligan defined perceptual map as a model using which businesses and most important marketers depict the customers’ perception of the brand (Najafizadeh, Elahi, Moemeni and Lotfi, 2012). This perception about the brands plays a defining role in the preferences from the customers. Najafizadeh, Elahi, Moemeni and Lotfi (2012) in a study have developed a comprehensive model for the identification of factors that impact on the perceptual map and hence shall be considered in building in perception of the brand in market as presented below: ( Najafizadeh, Elahi, Moemeni and Lotfi, 2012) Therefore, the underlying business aims to develop the perception of the business on the following factors: Hence, the Spring Health will be marketed in order to the develop a perception that it provides highly personalized services in the price that is still lower than exclusive and luxurious spas charging extensively high prices. MARKET DEMOGRAPHICS The demographics of for health and Fitness Company, is incorporated as follows: Geographic The geographic target is Hertfordshire. The total targeted population is 1,129,100, according to 2012 census (Hertfordshire County Council, 2012). Demographic Percentage of population in urban areas is 74% (Public Health England, n.d.). According to 2011 census, 49.10% of the total population were male, and 50.90% were female (North Hertfordshire District Council, 2011). Family income is around £25,000. Behavior Factors Identify the importance of physical activities in their lives. People are now more concerned about health and fitness and have incorporated daily exercises to remain fit for past few years in their lives. People are willing to take this sector as a professional concern. Most people are more likely to use fringe benefits of health and fitness centers. TARGET MARKET The customers are segmented on the basis of social class so the packages regarding fitness and exercise that are offered should justify the people of Hertfordshire carry along while being a part of a particular social class. There are three social classes which are most well defined on the variables of income and status. Initially, the place to focus is Hertfordshire, and then expansion strategies will follow-up in the long run. The major target will be the potential female students, working ladies and corporate women who belong to all segments of the middle class which includes lower-middle, middle-middle, and upper-middle class. MARKETING AND POSITIONING STRATEGY The market strategy of Spring Health will be based on following aspect: Promotion: As the target market of the business belong to middle class working population, students, and housewives; Spring Health has decided to promote business through various promotional tools, while ignoring media advertising at this initial stage. Spring Health will use different means of reaching its targeted potential customers such as pamphlets, word of mouth, and salesmen. Personal Selling: Spring Health will also focus on personal selling. Company will plan meetings with corporate to provide them with exclusive health and fitness services. RECOMMENDATIONs The following are the recommendations that are provided to the company: As Spring Health is a small sized company, which is owned by an individual, there is less charm for the investors to invest. Owner has £250,000 to start up this business, which is enough at this stage. Company can expand its business by intensifying its target market. Spring Health must also target the male population of Hertfordshire to develop business with pace. Spring Health must introduce more services like spa services and others to cater large population. Company must also consider integrated marketing communications through online portals, company’s website and blogs. People today are more likely to respond to online promotions due to the high rate of internet usage. This strategy will help the company to increase promotional activities, give recognition to the company at low cost. CONCLUSION Business landscape is getting competitive with every passing day. In a challenging business market, it is critical for an organization to develop a comprehensive plan that has taken into account all relevant aspects before starting a venture. Most importantly, the assessment of the market is critical that provides sheer understanding of the competition and customers in addition to the opportunity that a business can exploit successfully. In a similar format, the above report has developed a marketing plan for an individual investor to the start-up of a business in the health and fitness industry with the name Spring Health. The report has conducted a comprehensive secondary research based assessment about the market and customers and has made recommendations for the business accordingly.  While developing marketing plan, it has been kept in mind that business start-up is a venture of an individual investor and has to reap the benefits at most with the limited resources. References: Hertfordshire County Council (2012). Hertfordshire County Council: Your Council. [online] Available at: http://www.hertsdirect.org/your-council/hcc/env/factsfigs/population/currpop (Accessed 14 June 2014). Public Health England. (n.d.) Public Health England: Health protection profiles. [online] Available at: http://www.hpa.org.uk/web/HPAweb&Page&HPAwebAutoListDate/Page/1278943909381 (Accessed 14 June 2014). North Hertfordshire District Council. (2011). Statistics and Census Information. [online] Available at: http://www.north-herts.gov.uk/index/council_and_democracy/statistics_and_census_information.htm (Accessed 14 June 2014). Najafizadeh, N. S., Elahi, M., Moemeni, A., & Lotfi, Z. (2012). A model for brand positioning of hygienic products using the most effective factors on competitive position and perceptual map technique. African Journal of Business Management, vol. 6, no 27. Pp. 8102-8117. Hertfordshire Works. (2010). Hertfordshire’s Economic Development Strategy 2009-2021. [online] Available at: http://www.hertsdirect.org/your-local-data/locstats/17514992/ (Accessed 14 June 2014). Savills Research. (2014). The Health and Fitness sector shapes up. [online] Available at: http://www.savills.co.uk/research_articles/173929/174434-0 (Accessed 14 June 2014). Health Club Management. (2013). Health Club Management: Handbook 2013. [online] Available at: http://www.healthclubhandbook.com/pdf/HCH_2013.pdf (Accessed 14 June 2014). Hertfordshire County Council (n.d.). Hertfordshire County Council: Service. [online] Available at: http://www.hertsdirect.org/services/leisculture/aboutherts/ (Accessed 14 June 2014). ColtsFoot. (2014). Hertfordshire in the South East of England. [online] Available at: http://www.coltsfoot.com/index.cfm/hertfordshire/ (accessed 14 June 2014) Halkon, R. (2014). Hertfordshire County Council badly failing young careers. [online] Available at: http://www.thisislocallondon.co.uk/whereilive/northwest/borehamwood/10981068.Hertfordshire_County_Council__badly_failing_young_carers_/?ref=rss (accessed 14 June 2014) Hertfordshire’s Economic Outlook. (2011). [online] Available at: http://mediafiles.thedms.co.uk/Publication/BH-Herts/cms/pdf/Hertfordshire%27s%20Economic%20Outlook%20Full%20Report%201st%20Edition.pdf (accessed 14 June 2014) Hertfordshire. (n.d.). Hertfordshire Directory. [online] available at: http://directory.hertsdirect.org/kb5/hertfordshire/directory/results.page?communitychannel=5-8 (Accessed 14 June 2014). Read More