Strategic Marketing of Energy Industry - Assignment Example

? Report Answer 4 This part will recommend a marketing mix strategy for the energy providing organization. The marketing mix serves the purpose of being an important business tool that refers to mainly 4 P’s namely product, place, promotion as well as price. Product It is advent for any organization to utilize the available resources to its maximum level. Since resources are scarce, maximum utilization will open up more opportunities for the concerned company (Proctor, 2013). The adoption of newer technologies is of utmost important to remain competitive in the market. The advent of new technology will contribute to raise the productivity and will also reduce the production cost. The introduction of upgraded technology will enhance the power quality. The technological progress in the production process will also contribute in the distribution process of power. In this fashion less power will be lost in the distribution process and can be utilized by the people (Mkpandiok & Dimla, 1999). Price The price is the most important determinant that either drives the consumers towards the products or drives them away. If the price strategy is attractive the consumers will be driven to buy the products (Salzman, 2008). Again if the consumers believe the price is costlier than the substitutes available in the market, they will drive themselves towards the substitutes. Therefore thorough market research is necessary before labelling up the price. The company firstly needs to target the consumer base. If the target base is the upper income level people then the incomes of those consumers should be taken into account while adopting the appropriate price strategy. It is important to judge the demand throughout the year as well. It is recommended to use the flexible or the reasonable price strategy since this will allow the middle income group to fall with the consumer base. This strategy will have two objectives (Belohlavek, 2008). On one hand the company will be able to cement the consumer base while on the other the demand for the product will raise which will tend to bring in more revenue into the company. The middle income group generally have low disposable income and so a reasonable price strategy will be mouth watering for them. Place The first thing which the company will like to do is to target the areas where it expects to attain maximum demand. An effective market research technique is indispensible in this case. The population, income levels, the demand potential are some of the parameters that are taken into account while analysing the target market (Shaad, & Wilson, 2009). Once the potential areas have been identified the company needs to tap them either with the help of some attractive strategies or with various methods of advertisements. Once the potential market gets tapped the company needs to recruit the suppliers to maintain the distribution chain. These suppliers will provide electricity to the entire geographic location. Promotion It is necessary to increase the brand awareness in the modern world. The consumers are inclined towards brand and therefore companies tend to focus a lot today on generating brand value (Viardot, 2008). The brand value can be gained through various modes of advertising namely print media or digital media. The advertisements cement the name of the brands on the minds of the consumers. Similar advertisement initiatives include sponsorship of sporting events or television programs. The point is to stay in touch with the consumers all the time in whatever way it can be. Few Statistics The demand of energy has significantly increased over the last few decades. Significant energy production and appropriate distribution can drive the nation towards development and growth. Nigeria Follows federal constitution. The purpose of the study is to develop marketing mix strategy for the energy providing company in Nigeria. The organization is trying to provide electricity in the Nigerian Market. The Nigerian electricity industry is very much potential. The industry is suffering from several political, social and economical issues and electricity crisis. It is known to all that, Nigeria is enriched with natural resources. Nigeria is a mixed economy and it is one of the emerging economies around the globe. The country has achieved 7.3% GDP growth in the year 2011 (Worldbank, 2013). It is the 7th largest country in terms of population. In the year 2012, according to the census report, the population of Nigeria was 170,123,740. The population growth rate of Nigeria in 2010-2015 is 2.5%. The population of the country is largest among all the African countries. Female youth literacy rate between 2007 and 2011 was 66%. On the other hand, male youth literacy rate was 78%. According to UN, the population of Nigeria in the year 2011 was 162471 (UN, 2013). Annual growth rate of the Nigeria’s population is 2%. Therefore, census had assumed that the percentage will grow in 2012. GDP per capita has grown by 2% between 1990 and 2011. Government spending allocation is nil in Nigeria. The income distribution of the country is as follows: The income share held by the lowest 20% of the population is depicted in the chart and the table below: Year Value 1986 6.02 1992 4.00 1996 5.00 2004 5.13 2010 4.41 The share of income held by lowest 10% of the population is depicted in the table and diagram below: Year Value 1986 2.47 1992 1.42 1996 1.89 2004 1.99 2010 1.75 The share of income held by the highest 10% of the population is depicted below: Year Value 1986 28.21 1992 31.53 1996 37.10 2004 32.42 2010 38.23 Demographics 43.9% of the population of the country falls within the age group of 0-14 years while only 19.3% falls within the group of 15-24 years. 30% of the population falls within the age bracket of 25-54 years and only 3.8% of the total population are in the age bracket of 55-64 years. Only 3% of the population falls within the age group of 65 years and above. The population pyramid for 2012 is as follows: Government Support Several developing countries are following vertically integrated organizational structure. Government should influence the private players to enter in the market. Moreover, government of Nigeria should initiate deregulation of public policies as these policies are not productive. The government needs to bring privatization. The low disposable income of people, economic downturn and several social issues are affecting the buying behaviour of people. Due to several political conflicts, the government is overlooking this industry. End of the day, it is affecting both the nation and its development. The government should encourage the organization by distributing equal market power within the electricity industry. Several inadequate regulations and policies need to be deregulated. The government should focus on the privatization of whole electricity industry. Increasing competition and market privatization policy by government will help the organization to increase several competencies. These policies will help to overcome problem like electricity crisis as the private organization will effectively execute the business process in order to compete in this market. Open market economy, privatization and government deregulation will support the organization to increase its business output by serving the community. STP Analysis Segmentation Demographic and geographic segmentation strategy needs to be implemented by the organization. The recent economic and social scenario of Nigeria is not favourable for the energy industry. Low disposable income of people and previous recession has affected the purchasing power of the middle class people. However, the country is enriched with natural resources. The organization needs to implement geo-cluster approach in order to tap the potential geographical regions within Nigeria. The organization should target the customers depending upon the potentiality of local neighbourhood. In terms of demographic segmentation, the organization needs to realize the personality, value, social class and life style of the group of people. Depending upon the income level of people, the organization should implement low cost marketing strategy. Targeting Low disposable income and decreasing per capita income of people has restricted them to purchase. Therefore, it is necessary for the organization to target the people of upper middle and upper income level. Positioning The organization needs to implement cost based positioning strategy by reducing the business operation cost In order to tap the potential market (Plunkett, 2008). Due to several issues, the organizations within the industry have not effectively capitalized on the potential opportunities. Following perceptual map will propose the positioning strategy. This cost-quality positioning strategy will help them to bring sustainability in business. Moreover, people can get quality service with low price. Here, brand J should be the particular organization. References Belohlavek, P. (2008). Unicist Marketing Mix. London: Blue Eagle Group. Mkpandiok, S., & Dimla, J. (1999). Energy Crisis in Nigeria. Stamford: Cengage Learning. Plunkett, J. (2008). Plunkett’s energy Industry Almanac 2009. London: Plunkett Research Ltd. Proctor, T. (2013). Strategic Marketing: An Introduction. London: Taylor & Francis. Salzman, O. (2008). Corporate Sustainability management in the Energy Sector. New York: Springer. Shaad, B., & Wilson, E. (2009). Access to Sustainable Energy. New York: IIED. Viardot, E. (2008). Successful Marketing Strategies for High-Tech Firms. US: Artech House. UN. (2013). Social Indicators. Retrieved From: . Worldbank. (2013). Nigeria. Retrieved From: . Read More