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Evaluating the Marketing Strategy of Geocaching.com

Extracts from this document...

Introduction

Introduction This investigation is about the marketing of popular geocaching website geocaching.com. Geocaching is defined by Garmin, a producer of GPS devices as 'A high-tech version of hide-and-seek. Geocachers seek out hidden treasures utilizing GPS coordinates posted on the Internet by those hiding the cache.' With U.S cities such as Seattle, New York, Los Angeles and Phoenix and European capitals being at the forefront, geocaching has begun to gain gained notoriety in the U.S and Europe. With a growing customer base and increasing media coverage, the geocaching industry is just waiting to be discovered by many new customers, and at the forefront of this expanding market is geocaching.com. Geocaching.com is the world's largest geocaching and location-based gaming portal. Started in September, 2000, by GPS enthusiast and web developer Jeremy Irish, the site now hosts more than 4 million geocachers, and more than 1 million active caches. In this project, I investigated the marketing strategy of geocaching.com, looking in to the marketing mix, namely the four P's (Price, Product, Place, Promotion) and additionally geocaching.com's target market and geocaching.com's main competition. In regards to price I researched how geocaching.com ultimately creates revenue, users' opinions on the prices of both geocaching.com merchandise and premium memberships and moreover the pricing strategies used for both. In regards to product I researched users' opinions on aspects of the geocaching.com product and corresponding merchandise and the branding of geocaching.com as well as the product life cycle to a lesser extent. In regards to place I researched the distribution of both tangible and non-tangible geocaching.com related products in addition to the most popular place to purchase geocaching.com goods. In regards to promotion I researched promotional material and methods utilized by geocaching.com in addition to how customers ultimately were made aware of geocaching.com, with an emphasis on the viral marketing aspect of geocaching. In regards to target market I researched not only who geocaching.com's target market is, but also whether any other target market could potentially be targeted. ...read more.

Middle

Question 2 - After watching the video, to what extent do you agree with these statements? Evaluative Summary Price: Users' opinions of price: Prices seem neither too expensive nor too cheap in the consumers mind in regards to merchandise, as evidenced by question 8, and prices for premium membership appear to be effective, with a small proportion of users not being able to afford it. These prices seem to be effective to the mostly medium income target markets that geocaching.com targets. Sources of revenue: Upon analyzing responses the main sources of revenue for geocaching.com are from premium memberships (with 88.1% of users owning a membership) and additionally from merchandise (with 85.71% of users having purchased geocaching.com merchandise). With geocaching.com being the only licenser of geocaching.com trackables (dog tag that can be attached to objects and be tracked as they travel around the world), this is arguably one of the major ways that geocaching.com creates revenue from its merchandise, as backed up by the results. Purchasers also commented that they purchased more trackables and products in general due to bulk buying discounts and free shipping deals, which are a good example of sales promotion techniques. Geocaching.com stated that banner ads throughout their website were also used to create revenue, however upon secondary research it appears that these banner ads are solely used for the advertising of advertising space by geocaching.com itself, thus not creating revenue. The reason that this is not currently being utilized so strongly may also be due to the reason highlighted by Kelly Ranck, that they use 'very little banner ads...in order to respect the community and keep the site relatively ad-free'. Pricing Strategies: Through secondary data and application of theory, it appears that geocaching.com utilizes the pricing strategy of premium pricing, in regards to the membership, as premium content is being offered for the price, and moreover uses psychological pricing/ odd pricing in regards to the geocaching.com merchandise, with almost every price ending in '.99'. ...read more.

Conclusion

consumers seeing all the elements they'd wish to see in the product heavily emphasized, bar the tourism/sightseeing element of geocaching.com, a potential improvement to the marketing strategy. Users of geocaching.com appear to have strong brand loyalty, most likely due to the intelligent yet wholesome branding of the product. Finally, geocaching.com appears to be in the growth phase of the product life cycle. The place aspect of geocaching.com's marketing mix is a fairly simple one, with geocaching.com utilizing mainly the direct channel as well as using distributors. Additionally, the majority of people appear to purchase geocaching.com products from the official geocaching.com shop, this being somewhat of a benefit to geocaching.com as they retain all of the profits. The promotion of geocaching.com appears to place a strong emphasis on viral marketing (with Facebook being a major medium for this) and word of mouth, in addition to other tactics such as sales promotion and direct selling. Furthermore, surveyed users reacting positively to the company's use of publicity videos. The target market of geocaching.com appears to comprise of mainly families, outdoor sports enthusiasts and retirees. This target market appears to respond mostly positively in regards to all aspects of the marketing mix. A possible improvement in this area could be the introduction of a new younger target market, as suggested by Survey B. Finally, the competiton of geocaching.com seems to comprise of opencaching.com and terracaching.com, and navicaching.com and opencaching.us to a smaller extent. Additionally, compared to these businesses, geocaching.com does appear to be the market leader as evidenced by the comparative size, features and therefore presumably revenue. A potential improvement in this area linking in with the product aspect would be to loosen regulations regarding the placing of caches as this has encouraged customers to partially switched geocaching services in some cases. 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 18 18 1 ...read more.

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