Activity of Don Martin Limited - Case Study Example

Don Martin Limited Marketing Analysis Don Martin Limited was started 23 years ago asan auto supplies company. In the last few years, the business has faced various shortfalls. Owing to a tremendous flight of customers, the business has been losing money instead of making profit. According to Don Martin, in the recent past, the business has encountered service delivery shortfall. Customers are not satisfied with the services offered by the employees in the business. This shortfall has significantly reduced the income rate in the business. The business has attempted several strategies to increase its profits, including increasing the prices of its products, increasing production lines, and promoting the business through newspapers and radio. Due to these pitfalls, marketing strategy is exceptionally paramount for the success of the business (Pearce and Hardy 379). Most of the customers in this business are low income earners. They also live within the business jurisdiction. Due to their limited income, these customers require low priced products. To attract more customers from the area, Don Martin limited has decided to open credit account to its customers. Despite offering credit to customers, the business has continued to lose them due to poor services and high cost of its products. Frequent increases in price to maximize profit have, therefore, discouraged customers from shopping in Don Martin limited. To attract more customers and compete effectively in the market, the business should consider reducing the cost of its products. The demographic size in the business location is high. The business is located along the thoroughfare street right in the middle of the city blue-collar district (Michael and Kenneth 379). The business potential customers are blue-collar workers who constitute both middle and lower class males and females. There are different products in the business essential to the potential customers. The number of people in the town where the business is located is high enough to make the business succeed and earn adequate profit. To attract a considerable number of potential customers into the business, the business managers and administrators must consider improving the quality of their services. As confirmed by Don Martin, many customers expect quality services from the salespersons in the business. The business potential customers are middle aged people. Most of the products sold in the store are regularly used by middle aged people. Additionally, most of the blue-collar jobs are done by energetic middle aged people. Middle aged people buy products from Don Martin limited during weekends and in the evenings. To attract most of these customers, Don Martin administrators should consider offering their services over the weekends and during evening hours. Middle aged people also prefer buying their household products close to their residential areas. Therefore, Don Martins limited should consider opening businesses nears their residential areas. They should also consider improving their services delivery. This is due to the fact that most young people prefer quality services for their money. To attract and retain middle aged customers, the business management should consider advancing its service delivery to potential customers. In the recent past, Don Martin limited has faced severe reduction in its customers due to its poor services. To attract more customers, Don Martin limited should conduct market survey to understand its customers’ needs. The businesses should ensure that the relevant products are offered to young people in their area of coverage. On the other hand, the business has also relied on outdated service delivery methods. As observed by Don Martin, the other stores have offered different products for shoppers to compare. Don Martin limited lacks variety of products and services for the potential shoppers to compare. In its early years, Don Martin limited had very consistent and quality services to its customers (Michael and Kenneth 379). In modern days, the business has reduced its services to its customers, thus discouraging them from shopping in the business. This problem is facilitated by the lack of adequate and quality management. The business has not considered increasing its managers in accordance to its expansion. Implications Product Poor service delivery to customers has negative implications on the business products. To start with, the business has opted to increase the prices of some of its products to maximize profit. This has reduced the business selling rate. On the other hand, the number of people in town is high enough to make Don Martin limited succeed. Additionally, the business is popular due to its frequent promotion in newspapers and through radio services. However, despite of the variety of products in the store, only very few customers prefer buying there. The reduction of the number of people willing to buy in the store is due to poor services and the increase of prices. The products in the stores fit the age of the potential customers. However, middle aged people prefer quality services for their resources. The poor services offered by the business attendants have discouraged middle class customers from purchasing in the business. On the other hand, the business has failed to consider its customers’ needs. The business customers are also not informed of some services, such as the parking lot, offered by the business. Price Poor services offered to customers have resulted in the increase of the cost of products. As a result, the business has lost most of its customers to other businesses which sell their products at fair prices. Most of the potential customers in the business are middle and lower level earners who prefer buying products at fair prices. On the other hand, middle aged customers lack adequate resources to cater for expensive products. To attract more customers in the business, Don Martin limited ought to consider reducing the cost of its products. On the other hand, the cost of the products in the market should be in line with the customers’ needs. The increase of prices of the products that are not required in the market has led to the reduction of the number of customers (Michael and Kenneth 379). Place The increase in competition level in Don Martin limited location has resulted in the rise in price competition. On the other hand, the demographic status of the area where the business is located requires quality service delivery. Middle class people pays for the quality of the services and products they get from the market. Additionally, in most cases, middle aged people are more concerned with the quality of the services they get for their resources than the purchased products. Don Martin limited poor service delivery failed to meet the needs of the customer in their location, thus diminishing it position in the market. Promotion Don Martin’s spending on advertising is extremely high. $ 100,000 on newspapers and radio promotions is a very big sum. The increase in the promotion cost is due to poor services offered to customers. The promotion cost is also transferred to customers through increasing the cost of products. In most cases, blue-collar employees lack adequate time and resources to buy newspapers. Therefore, the business relies on the erroneous media in its advertising initiatives. The business ends up spending a lot of resources for unproductive promotions. On the other hand, the age of the potential customers do not use newspapers. Instead, they rely mostly on television services and other social media services. Using newspapers and radio in promotion is, therefore, irrelevant to the potential customers. The promotion methods applied do not meet the customer needs (Michael and Kenneth 379). Don Martin limited offers delivery services to its customers. These services have led to the increase of operation expenditures. There are also several competitors in the market. These competitors offer quality services and a variety of products to their customers. One of the main Don Martin’s competitors is Canadian Tires. The high number of competitors in the market has led to the reduction of prices and the reduction of the quantity customers who purchase in Don Martin limited. External analysis Socially, most customers prefer quality service delivery from businesses operators. Don Martin’s competitors have ensured quality service to their customers. As a result of this, Don Martin limited has experienced reduction in the numbers of customers. On the other hand, other competitors have embraced modern technology in their promotion. Don Martin relies on radio and newspapers. Due to this, Don Martin limited spends a lot of resources for unproductive promotions. Economically, most of the company’s potential customers are middle earners and middle aged people. They, therefore, have very limited resources to spend. The cost of Don Martin products is extremely high for middle class customers. The high cost of Don Martin’s products has discouraged customers from buying them. Corporate capability Don Martin limited has adequate resources to sustain itself for relative long periods of time. The business has invested its financial resources in various products. However, the management of the financial resources is poor. A lot of the financial resources are spent on unproductive activities such as promotion. Don Martin is also popular at the market. It has a good reputation. The business offers relevant products. Nevertheless, in the recent past, the business has tarnished its good reputation because of its poor service delivery and high cost of its products. Don Martin limited has one of the most successful production processes. The business buys its products directly from manufacturers. This initiative assists the business in maximizing its profit. However, the business does not get maximum advantage associated with buying products directly from manufacturers. This is caused by the inability to buy a sufficient quantity of products from manufacturers. The business has some of the most qualified and experienced managers. These managers are competent in specific business areas. However, other employees lack the commitment to offer quality services to customers. Some of the implications associated with poor service delivery are the increase of prices of the business products due to poor financial management, the use of irrelevant promotion technology, the increase in market competition due to the poor service delivery, and the loss of customers as a result of poor service delivery. Alternative analysis Increase in the cost of Don Martin’s products has relatively reduced the number of customers willing to buy. Middle class earners prefer to buy products at a fair and friendly price. The products price should in this case be in line with the customers’ capability. On the other hand, Don Martin’s distribution services have significantly contributed to the reduction in the number of customers. Adequate and appropriate distribution services attract more customers into the business. Market research is also very relevant in promotion. Don Martin used wrong promotion services. Poor promotion methods have led to the misappropriation of resources. Don Martin should consider using variable costing to maximize its profit and attract and retain more customers. In this case, the business should consider employing qualified employees who will offer quality services to customers. The promotion cost should also be reduced to decrease its products costs. Quantitatively, the business should consider attracting more customers by lowering the cost of its products. It should also employ qualified employees to enhance quality service delivery. Qualitatively, servicing few customers to their satisfaction is very crucial in attracting more customers into the business. Discussion and Recommendation Poor service delivery has made Don Martin limited lose a significant number of its customers. The business has failed to meet the needs of youthful blue-collar customers. Its promotion method has failed to meet its intended objective. On the other hand, the business has increased its products’ cost beyond customers’ capability. Additionally, the company’s distribution channel is inadequate to meet the target customers’ needs. To counter these pitfalls, the management should consider employing appropriately the four marketing Ps (price, product, promotion, and place). To offset the problem faced by the business, relevant action plan is necessary. Don Martin needs to include other managers in the decision-making process. Frequent meetings among all stakeholders should be the first initiative. After meeting among all involved players, other employees should be informed on the importance of quality service delivery to customers. After that, the management should consider employing experts to train existing and new employees in the most appropriate ways of offering quality services to customers. Frequent monitoring and evaluation should follow, so that the impact of the plan could be assessed. The entire process should take less than three months. Works cited Pearce, Michael, and Kenneth Hardy. Don Martin limited. Ivey management services. 2002 (1, 2): 379-384. Print. Read More