Market research
In large firms, such as Burberry Company, it is rare for any significant marketing decision to be made without market research. Even an apparently minor change to a pack design will only be carried out after testing in research. The Burberry Company uses both field research and desk research to identify the competitors and understand its customers.
Field research
Questionnaire is one of the field research methods the Burberry Company used that involved personal interviews, telephone interviews and postal surveys. The research is expensive and its results may influence major decisions such as whether to launch the new product- BURBERRY LONDON PERFUME. So a mistake in writing the questionnaire may prove very costly. For instance, the wording may influence respondents to sound more positive about a new product than they really feel.
The questionnaires clearly defined research objectives; it ensures that questions do not point towards a particular answer; it also ensures that the meaning of each question is clear, perhaps by testing (piloting) questions before putting them into field work. It is useful, though, to include a few open questions, to allow respondents to write a sentence ore two, providing more depth of understanding.
Personal interviews are also called structured interviews, which are questionnaires that are delivered face to face. They arranged for salesmen in stores to conduct these interviews, so the salesmen would ask some customers whether they would like to be asked some questions on the product, such as “are you satisfied with the price of BURBERRY LONDON PERFUME?” “What do you think about the BURBERRY LONDON PERFUME?” after the personal interview, the customers was given a bottle of BURBERRY LONDON PERFUME for present, and they were also asked whether they would like to recommend BURBERRY LONDON PERFUME to other people, such as family, friends etc.
However, there may be interview bias involved. In the personal interview, the customers may give answers which they think are socially acceptable or which show them in a positive light. This information may have been biased because they might reveal their true thoughts or behaviour.
Telephone interview is basically the same as personal interview, but the place, which they choose is different. Comparing with personal interview, the salesmen choose to phone the customers, salesmen pick up the phone number automatically from the computer. The salesmen asked the same sort of questions in the telephone interview as in the personal interview; they were mainly trying to find out the standard price, impression and the satisfactory of customers to the perfume.
The Burberry Company used the results of telephone interview to conclude that BURBERRY LONDON PERFUME had a good impression among the customers; in addition, it is one of the most popular perfumes in the perfume marketing. However, the disadvantage of using this method was that the customers normally would not want these incoming calls, as they can either be busy or not be bothered about these questions. In addition, the consumers of BURBERRY LONDON PERFUME are generally from the age of 25 to 45, so anyone can answer the phone, which makes harder for the salesmen. At this point, telephone interviews would not be used as easy as personal interviews.
This provides a relatively cheap, quick and efficient way of obtaining large amounts of information from large number of people; in addition, it has no geographical restrictions and can be mailed anywhere. Burberry Company sends the questionnaires to the local houses. On the questionnaire, there are questions like “which brand of perfume do you normally use?” “Have you heard of BURBERRY LONDON PERFUME” “Comparing with BURBERRY LONDON PERFUME, which one do you prefer?” “Which price can you accept?” in this letter, there is also a description of BURBERRY LONDON PEFUME, in case if people do not know about the perfume. This is also an advertisement, if people are not bothered to do the questionnaire or reply the questionnaires; at least the company has a chance to let people know about the perfume. Whereas, the response rate is usually low, those who choose to reply may not be representative or typical of the population under study.
Desk research
In order to get known the competitors for the new product BURBERRY LONDON PERFUME, the company uses desk research to identify the competitors. Desk research is mainly about secondary data. Therefore, analysis of the competition is also one of the marketing principles.
Secondary data
Secondary data is information which has been collected by other people or organizations such as government agencies and which is available to the sociologist second hand. It can be either quantitative or qualitative.
Quantitative research asks pre-set questions on a large enough sample of people to provide statistically valid data. Qualitative research is in-depth research into the motivations behind the attitudes and buying habits of consumers. It does not product statistics such as 52% of perfume buyers like strong smell of it. Instead of that, it gives clues as to why they like it (is it really because it’s strong, or because it’s different/a change.) qualitative research is usually conducted by psychologists, who learn to interpret the way people say things as well as what they say.
Internet data is the data that people collect from the Internet. On the Internet, the company can easily find the financial report of share from its competitors. People from the management department can also find how much the customers like about the perfume from the other competitors’ company by using the previous survey from the competitors’ websites.
Internet data is cheap, readily available and covers many aspects of social life. However, many sociologists are vary of official statistics and tend to handle them with caution, in addition, it is not always in a form the firm would want, and this is because it has been collected for another purpose.
From the research that used by the Burberry Company, it basically helps the company to analysing its customers and what the customers really need. From the field research, the company finds out that BURBERRY LONDON PERFUME had a good impression among the customers; in addition, it is one of the most popular perfumes in the perfume marketing. Also from the research, the BURBERRY LONDON PERFUME is primarily towards middle-aged women, ages ranging from 28 to thirty something. Customers like the perfume because the smell of the perfume is unique.
Christian Dior
By using the Internet data, the company finds out that there are several competitors who produce a similar perfume. One of Burberry Company’s main competitors is Christian Dior, which is also known as CD.
Aims and objectives
The perfume market of Christian Dior is primarily towards middle-aged women, ages ranging from 30 through 50-something. CD keeps a detailed inventory and accounting system must be kept on the database, so that the company can keep track and reorder when appropriate so to prevent the unnecessary and often times extensive shortage costs, which shows CD is trying to make the maximization profit.
In order to satisfy the customers and expand this company, CD sets up its own website. CD’s website has a good selection of items available for purchase. It also makes online purchases easy, as the forms for billing and shipping information are standard and straightforward.
Marketing research
The marketing research of Christian Dior using is primary research. Questionnaire is one of the primary researches that CD used. A questionnaire is a set of printed questions, which is given to a number of people in order to collect statistical information. To meet its customers’ needs and therefore improve its chances of survival, a business must provide customers with what they want, when they want it, at the right price and quality. Therefore, around 10 staff is sent by the CD Company to shopping centre. In the shopping centre, staff will try to find people to fill in the questionnaire for them. The questionnaires are not necessarily filled by people. Staff will ask people some questions such as “are you a fan of Christian Dior?” “Why do you like CD?”
By using the questionnaire, CD Company can find out how many customers there are, how much the customers are willing to pay, what their needs, desires, expectations, how it can best inform, persuade and convince customers to purchase the product, more importantly, they what motivates customers and what attracts them to particular brands.
Market environment
An external audit should consider each of the major markets in which the Burberry Company competes. The key factors of importance are:
- Market size— it is measured by value and volume of sales. Nowadays, the size of market perfume is very big, as more and more people start to follow the fashion, and start to wear perfume whenever they are going out.
- Market growth— it is measured by the percentage change in the value and volume of sales.
- Market trends—such as the position of the product in its life cycle.
- Product positioning—a process widely adopted by marketers is to ‘map’ consumer impressions of the goods available for purchase, based on the most important benefits the product offers consumers. This method allows managers the opportunity to analyse the potential for changes in strategic approach towards a particular brand.
PEST
PEST is useful way of analysis the market environment for Burberry Company. PEST stands for Political, Economic, Social and Technological.
Political factors affect the activity of business. Government policy can have a major impact on the operation of a business. For example, laws on competitive practices will influence the Burberry Company operating in an industry and therefore the strength of the competition. Health and safety legislation will affect work practices and production costs. It is important to study the political environment within which the Burberry Company operates, particularly in countries where governments are unstable and therefore investment risks are high. Political developments are generally out of the control of the Burberry Company, but it needs to forecast and anticipate changes and then react accordingly.
Burberry Company makes sure that:
- If the customers are leaving UK within 3 months, they can purchase without paying any tax.
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In order to comply the employee law, the company gives every staff contract, and the lowest wage is £4.00 or above per hour.
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The Company has developed a comprehensive Health and Safety policy detailing the responsibility of managers at all levels in the Group to ensure the health and safety of employees, contractors and customers.
Economic influences look at how the performance of the economy impacts on Burberry Company. For example, the relationship between unemployment and demand for the product, and therefore the marketing strategy, depends largely on the type of product or service. Also the level of consumer demand is a key variable affecting the quantity of sales and the price at which output can be sold. Interest rates will determine the cost of finance to the company. Economic may also influence consumer spending, e.g. when the income of the consumer raises, the BURBERRY LONDON PERFUME sales rise. When the savings of the consumer rises, the BURBERRY LONDON PERFUME sales fall. Final profits will be taxed by the government. The economic cycle of recession and recovery is an important influence on the opportunities and threats to the Burberry Company.
The social environment describes the characteristics of society, the people who live in that society and their values and benefits. Consumers reflect changes in lifestyles over time. This means the Burberry Company must observe shifts in the characteristics and habits of the population. Especially where these influence segments of the existing market. For example, as the UK population ages, new opportunities open up such as holidays aimed specifically at older people. For Burberry, older age people are generally wealthy, and BURBERRY LONDON PERFUME is mainly towards middle-aged women, therefore, it makes sure that the price is reasonable for the consumers.
Many technological developments affect organisations. Growing computer ownership and the Internet allow people to buy virtually anything without leaving their homes. The use of the Internet for business-to-business transactions is the most important technological change currently affecting business. For instance, as Burberry Company sets up its own website, customers are able to purchase on the Internet.
Various methods of marketing
Marketing mix and the use of the Boston matrix is a useful way of describing the various methods of marketing used by Burberry Company.
Marketing mix
The marketing mix refers to those elements of the firms marketing strategy, which are designed to meet the needs of the customers. There are four parts to the marketing mix- product, price, promotion and place. These are often known as the four Ps. To meet consumers’ needs, businesses must produce the right product, at the right price, make it available at the right place, and let consumers know about it.
Product: this means the combination of goods and services that is offered to the target consumer. Product aspects that may be manipulated include style, performance, quality, branding, packaging and after-sales service. For BURBERRY LONDON PERFUME, the basic function of package is to protect its contents in transit, in storage and in use, and this plays a major part in determining its shape, size and the materials used. However, consumers increasingly see attractive packaging as adding value to the perfume.
Like packaging, merchandising and display have a major role to play in promoting the perfume to potential customers. Merchandising can be regarded, generally, as presenting stock effectively, whereas display is the specific act of putting stock in places where it is to be viewed by potential customers.
Price: is the amount of money consumers have to pay to acquire the product. This can vary considerably from the advertised price. The pricing policy that a business chooses is often reflection of the market at which it is aiming. Deciding how much to charge for goods or services is also very important and will be linked to the overall marketing objectives. For BURBERRY LONDON PERFUME, the price is mainly charged around £35 to £40 in the UK. Because they are using the cost leadership, the price is around £25 in Asia. The price can also be different when the product is in a special offer or sale. Normally, after Christmas, BURBERRY LONDON PERFUME is going to reduce the price around 25%, so the factory can get rid off the old perfume, and start to make the update one.
Promotion: describes the activities undertaken to ensure the consumer knows about the product and its capabilities. It is usually made up of a combination of advertising, sales promotion, public relations and personal selling. A business will choose a promotion method if it feels it likely to be most effective in the market in which it operates.
As BURBERRY LONDON PERFUME is the new product entered into the market, it cannot have any discount offer. In order to tell potential customers about the benefits of the perfume, the company sets up its own website. Also through using advertisement, is a way that the BURBERRY LONDON PERFUME doing the promotion activity. With promotional gifts, such as bottles of spirits, clocks, watches or diaries, are considered useful bounty for dealers. Through promoting the perfume, the company can increase sales, provide information that may assist with buying decisions, develop awareness of new products or developments to the BURBERRY LONDON PERFUME.
Place: refers to the means by which the product will be distributed to the consumer the product must get to the right place, at the right time. This involves making decision about the way in which the product will be physically distributed. It also means taking into account how the product is sold. The company normally chooses the perfume to be displayed in the stores like boots. In addition, the BURBERRY LONDON PERFUME is also placed on the website, so people can easily purchase the perfume at home.
Boston matrix
The Boston matrix identifies the product groups of an organisation and places them on a matrix that considers market growth and relative market share. The assumption is that a larger market share will enable an organisation to benefit form lower unit costs and therefore higher profit margins. By highlighting the position of each product in terms of market share and market growth the firm can analyse its existing situation and decide what to do next. There are four areas into which product groups can be allocated.
‘Stars’ have a high market share in a high growth market. They have the ability to generate significant sales in the short and long term, but require promotional investment to maintain their market position. Burberry Company is more likely in this section, as Burberry Company owns a high market share, and by using diversification marketing strategy to get the maximization profit. The BURBERRY LONDON PERFUME is obviously attractive- it is doing well in a successful market. However, they may well need protecting from CD’s product.
‘Cash cows’ have a high market share in a market showing little growth. These products are generally well established with plenty of loyal customers. The product development costs are typically low and the marketing campaign is well established. Cash cows will normally make a substantial contribution to overall profitability. They finance the investment needed to maintain a ‘stars’ high market share and to develop ‘question marks’. Christian Dior is more likely belong to this section, as CD has been in the perfume market over a long period. The growth is growing slowly, and CD has a high market share. The perfume of CD generates high profits and cash for the company because sales are relatively high whilst the promotional cost per unit is quite low. Consumers are already aware of the brand, which reduces some of the need for promotion.
In this task, I am going to describe and analyze the marketing strategy used by the Burberry Company to increase the demand for the BURBERRY LONDON PERFUME. In addition, I am going to compare the effectiveness of techniques of marketing analysis in supporting the marketing development of the products provided by Burberry Company.
Marketing positioning
This strategy is based upon the ‘position’ which a business wishes to occupy in relation to other businesses operating in the same market. It can also be a product position. The position of a product refers to a specific quality or characteristic of the product which is most often stressed in its advertising and is best known to the customer. Every business will attempt to achieve a unique position for itself, its products or its services, in the heart and mind of the consumer. It will do this by emphasizing one or other of its main features- its unique selling point.
Positioning is all about ‘perception’. As perception differs from person to person, so do the results of the positioning map. Products or services are ‘mapped’ together on a ‘positioning map’. This allows them to be compared and contrasted in relation to each other. This is the main strength of this tool. Marketers decide upon a competitive position which enables them to distinguish their own products from the offerings of their competition.
In order to find out the position of the Burberry Company and BURBERRY LONDON PERFUME, also try to find out what marketing strategies are needed for the perfume, the graphs below can help to find out about these.
Higher price
Lower price
From the table above, the BURBERRY LONDON PERFUME will be placed into higher price and high availability. This is because there are not many products in the higher price with high availability. As CD and HUGO BOSS are the main competitors for BURBERRY LONDON PERFUME, the Burberry Company is using cost leadership to gain a price leader among the main competitors.
Stronger smell
Lighter smell
Multiply product
Single product
According to the chart, CD is the only product that in the multiple products with elite cost, and CD is also the main competitor, therefore, the company should place itself in the multiple products with elite cost, and because of this, the Burberry Company uses diversification strategy.
Marketing strategy for growth
Many businesses operate in or intend to move into markets where business growth is both desirable and possible. Businesses operating in such markets will tend to emphasise growth in their corporate and marketing objectives. Growth may be in the form of increased sales revenue or turnover, greater profits, increased capital or more land and employees. There is a range of marketing strategies that growth orientated businesses can adopt. However, growth orientated marketing strategies are not suited to all businesses. The ANSOFF MATRIX is a useful tool for businesses aiming for growth; the Ansoff Matrix illustrates both existing and new products within existing and new markets. Four possible marketing strategies to achieve growth are revealed by the Matrix
Product
Market
Initially there are two key choices in the Anosff Matrix: to exploit the product or the market. To make a decision a business would have to assess or screen the new markets and new products, and then compare the potential benefits with those expected from continuing with existing markets and products.
Market penetration
The Burberry Company is placed in the market penetration. As suggested by the Ansoff Matrix, the purpose of market penetration is to achieve growth in existing markets with existing products. When the overall market is growing, penetration may be relatively easy to achieve, because the absolute volume of sales of all firms in the market is growing and some firms may not be able to satisfy demand. The Burberry Company can achieve this by increasing the brand loyalty of customers so that they use substitute brands less frequently; encouraging consumers to use BURBERRY LONDON PERFUME more regularly, an example might be encouraging people to use perfume whenever they go out or even stay at home; encouraging consumers to use more of the BURBERRY LONDON PERFUME.
Diversification
To increase the demand for BURBERRY LONDON PERFUME, one of the marketing strategies the Burberry Company using, is diversification. Diversification usually occurs when new products are developed for new markets. This is the most expensive and risky strategy and requires intensive screening of both the ideas for Burberry London perfume and the opportunities in this perfume market. Diversification allows a business to move away from reliance upon existing markets and products. This allows Burberry Company to spread risk and increase safety. If BURBERRY LONDON PERFUME faces difficulties or fails, a successful Burberry product-bags in another market may prevent the business overall facing problems. Also diversification will take a business overall outside its area of expertise. Therefore, the Burberry London perfume’s performance in this new market is relatively poor compared to more experienced operators, such as HUGO BOSS and Christian Dior.
Competitive marketing strategy
There are three main competitive marketing strategies: cost leadership, differentiation and focus.
Cost leadership: the aim of a cost leadership strategy is to gain a cost advantage over competitors. This cost advantage can then be passed on to consumers in the form of lower prices. Businesses can gain a cost advantage by having higher levels of productivity and more efficient supplier and distribution networks.
Burberry Company is using the cost leadership marketing strategy to remain in the competition of perfume. The Burberry Company can gain a cost advantage by having higher levels of productivity and more efficient supplier and distribution networks. However, the main problem with cost leadership, which is the perfume marketing strategy that the Burberry Company is using, is that it focuses upon costs of production and lower prices rather than the needs of consumers. This may create certain problems. For instance, the consumers might not always wish to purchase the lowest price product as it may have been perceived as being of lower quality, particularly, perfume is the liquid that can go straight into consumers’ body, therefore, and the consumers may not look at the price but the quality. In addition, nowadays, there are many consumers more likely looking at the higher price perfume than the lower one. Therefore, the Burberry Company is using this strategy carefully; the price will only be produced lower in certain countries, such as in Asia. For example, In China, the BURBERRY LONDON PERFUME will be a bit cheaper than Christian Dior. However, there are still some consumers not to bother about the price between these two brands’ perfume. In USA, and Europe, the Burberry Company is mainly using the diversification marketing strategy that BURBERRY LONDON PERFUME is developed for the new perfume market, which is separated from BURBERRY, so that they make their own advertisement, and give the consumers new image of their perfume.
Pricing strategy
Pricing strategies depend on the product and the market. Different strategies will be needed for new and existing products. The pricing strategy that the Burberry Company using is price taker; where the price is set at the market level. This happens in highly competitive markets. Businesses want to avoid a price war that will reduce profits.
As the products— perfume and the market— perfume market are already exist, and the Burberry Company is not trying to start a price war, the company simply uses price taker strategy that when BURBERRY PERFUME LONDON goes into the market, the product tries to fit in with other products, which means try to make similar price for the perfume—BURBERRY PERFUME LONDON.
Various techniques of marketing analysis
PEST
The useful way of analyzing the Burberry Company external techniques is by grouping internal forces neatly into four areas using a PEST analysis, which stands for Political, Economic, Social and Technological influences, all of which are external.
Political, legal and fiscal factors
This is concerned with how political developments, regionally, nationally and internationally might affect the Burberry Company’s strategy. It might include a consideration of legislation, such as consumer laws, regulation, political pressures and the government’s view of certain activities.
Burberry Company makes sure that:
- If the customers are leaving UK within 3 months, they can purchase without paying any tax.
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In order to comply the employee law, the company gives every staff contract, and the lowest wage is £4.00 or above per hour.
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The Company has developed a comprehensive Health and Safety policy detailing the responsibility of managers at all levels in the Group to ensure the health and safety of employees, contractors and customers.
Economic factors
Economic factors will influence the future potential profit of a business. The level of consumer demand is a key variable affecting the quantity of sales and the price at which output can be sold. Interest rates will determine the cost of finance to the company. Final profits will be taxed by the government. The economic cycle of recession and recovery is an important influence on the opportunities and threats to the organisation.
Social factors
Consumers reflect changes in lifestyles over time. This means the Burberry Company must observe shifts in the characteristics and habits of the population. Especially where these influence segments of the existing perfume market. For example, as the UK population ages, new opportunities open up such as holidays aimed specifically at older people. Demographic variations may also represent a threat to companies.
Technological factors
Technological factors can lower barriers to entry, reduce minimum efficient production levels, and influence outsourcing decisions. Some technological factors include:
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Recent technological developments: the technology allows for products and services to be made more cheaply and to a better standard of quality.
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Technology’s impact on product offering: the technologies offer consumers and businesses more innovative products and services such as the customer can purchase on the internet by using the Burberry Company’s website.
SWOT
A SWOT analysis is a useful technique when considering new business venture. It is also useful approach to examining the relationship between an organization and its marketing environment. It stands for: Strengths, Weaknesses, Opportunities and Threats.
Strengths
A firm’s strengths are its resources and capabilities that can be used as a basis for developing a competitive advantage.
For Burberry Company, they are able to respond very quickly as they have no red tape, no need for higher management approval, etc. they are also able to give really good customer care, as the current small amount of work means they have plenty of time to devote to customers. The consultant has strong reputation within the perfume market. They can also change direction quickly if they find that the marketing is not working (as they use the diversification marketing strategy). The overhead of Burberry Company is very little, so they can offer good value to customers.
Weaknesses
In Burberry Company, they have a small staff with a shallow skills base in many areas. They are vulnerable to vital staff being sick, leaving, etc. In addition, the cash flow is unreliable in the early stages. As the cost of perfume comparing with others is high, the cost leadership strategy can only be existed in certain countries, such as in Asia.
Opportunities
The external environmental analysis may reveal certain new opportunities for profit and growth.
The Burberry Company is expanding, with many future opportunities for success. Their local council wants to encourage local businesses with work where possible. Their competitors may be slow to adopt new technologies. In addition, Burberry Company has the opportunity to enter an international market, such as Japan, China.
Threat
Changes in the external environmental also may present threats to the firm. For Burberry Company, a small change in focus of a large competitor might wipe out any market position they achieve. Also developments in technology may change this market beyond their ability to adapt.
Product Life Cycle
The life of a product is the period over which it appeals to customers. We can all think of goods that everyone wanted at one time but that have now gone out of fashion.
The sales performance of BURBERRY LONDON PERFUME rises from nought (when the product is introduced to the market), reaches a peak and then goes into decline. BURBERRY LONDON PERFUME has a limited life-cycle. Initially the perfume may flourish and grow, the perfume market will mature and finally, BURBERRY LONDON PERFUME will move towards decline and petrifaction. At each stage in the product life-cycle there is a close relationship between sales and profits so that, as the Burberry Company goes into decline, their profitability decreases.
The life-cycle can be broken down into distinct stages. In the introductory phase, growth is slow and volume is low because of a limited awareness of the perfume’s existence. Sales then rise rapidly during the period of growth. It is during this phase that the profit per unit sold usually reaches a maximum. Towards the end of this phase, competitors enter the market to promote their own products, which reduces the rate of growth of sales of the initial perfume.
Competitive jockeying— such as the perfume differentiation in the form of new colours, sizes, etc. during saturation, some brands will drop out of the market. The perfume market may eventually decline and reach a stage when it becomes unprofitable.
The life-cycle may last for a few months or for hundreds of years. To prolong the life-cycle of BURBERRY LONDON PERFUME, the Burberry Company needs to readjust the ingredients of the marketing mix. Periodic injections of new ideas are needed-product improvements, line extensions or improved promotion. BURBERRY LONDON PERFUME should be written under growth, as recently it is in a high growth with high market share.
The techniques of the competitor
The part of the techniques that Christian Dior using is the same with Burberry Company. CD sets up its own website. Its website has a good selection of items available for purchase. It also makes on line purchases easy, as the forms for billing and shipping information are standard and straightforward. There are several features about this website. An online magazine that shows the user the monthly outfit with the fashion expert advice and their designers’ fragrances’ tips. The magazine also shows the beauty information and local events. The website of CD has been quite successful as its website had good content and it was easy to use.
The difference comparing with the Burberry Company is that CD uses the differentiation marketing strategy. As the most important factor for perfume is the smell of it, in order to make a difference, CD created their unique smell that no other perfume would be the same. So that CD makes life cycle in growth and maturity stage, as the market is large enough to make it profitable.
CD uses differentiation marketing strategy is because all other perfume has a similar smell, and the most important factor for a perfume is the smell of it. In order to remain in the competition with Burberry, CD has to make something different to the perfume. Although using differentiation marketing strategy is a good idea, the Burberry Company has already picked diversification strategy to use, in addition, diversification has a highly cost, therefore the Burberry Company will not be able to use the differentiation strategy.
Marketing strategies
By reviewing the market strategies that the Burberry Company used, it has been very successful in general.
One strategy that the company used is diversification, which is developing new products for sale in new markets. This is a risky strategy because the organization is moving into areas in which it has little or no experience. Instances of pure diversification are rare and it is used only when no other growth routes are available. The situational analysis should consider the risks arising from serving the current perfume market- things that might go wrong or prove problematical. Such risks might include the economy experiencing low growth, resulting in falling product demand. Most devastating of all, the BURBERRY LONDON PERFUME, the Burberry Company in marketing might lose favour with the consumer. Burberry Company is seeking to reduce the risk associated with operating in a particular market have entered new and unconnected perfume market.
Another marketing strategy that the Burberry Company using is cost leadership, which as being the result of cost advantages achieved by management paying attention to what it calls cost drivers. However, lower costs must be achieved at the expense of quality. In other words, cost leaders are not producing inferior goods or services, just lower cost ones. This is usually done through high output, so that economies of scale and experience result in cost savings. Workers become more efficient and effective by learning from their mistakes, so that over time productivity increases.
The last but not the least, marketing positioning is also a marketing strategy that the Burberry Company using. Positioning has been defined as ‘the place occupies in a given market as perceived by the relevant group of customers’. The good thing of using this strategy is that you can clearly see which position the company currently own, who the company has to defeat to own the position they want. In addition, the Burberry Company can find itself a position that it is suitable for them to be in.
Develop the marketing strategy
If I must make recommendations on this marketing strategy, I would choose not to use diversification for marketing growth. Instead of diversification, I would prefer choosing market development. Because diversification has such a high risk to the company, although the Burberry Company has the power to cope with the risk, I would still prefer to reduce the risk. Market development entails expanding into new markets with existing products. These may be new markets geographically, new market sectors or perhaps new uses for the product.
