Our price strategy will be to use the average price per unit as a guidance which is around $14.30 in July 2018 according to Statista. Depending on the cost of production, the price can be or not adjusted in order to maximise our profit which I think it will be attained through sales’ quantity maximization of our products. Luckily, we are exempted from trade tariffs due to the free trade agreement. We will certainly set our prices relative to the potential competitors in the industry in order to meet the stiff competition and remain on the competitive edge.
“A company’s communication strategy is partly defined by its choice of channel” mentioned by Hill (p. 591, 2013). Due to the electronic media available and accessibility to mass market, our promotion will be based on pull-push mix strategies. Although they will mostly be used during selective events such as Christmas, Halloween, Easter and at the national chocolate day. Acknowledging that our company is a small organization with limited budget. Hence, our selection of communicating/promoting should be strategically done to meet our objectives.
BTL promotion requires promotional activities which aim to directly reach consumers, and the company has more control over and it is not expensive compared to above the line (ATL) promotion. Our target is a mass target as everyone eat chocolate and promotion’s activities considered are Sales promotion; Internet marketing and Trade fairs and Exhibitions.
Our approach should be to create awareness of our products to consumers with the aim of increasing demand. Then this will push distributors to stock our product. Below is the plan per activity with the aim to achieve our objective.
It is a vital tool in IMC (Integrated marketing communication). Mostly, they refer it to incentives that the entity will apply to entice consumers to buy its products as explain above. Therefore, we will have to use two different approaches: consumer and trade sales promotion.
For this approach, we will directly offer incentives to consumers with the aim entailing them to purchase our products more frequently by increasing trial of ChocoSol product with incentives when purchasing. Incentives can be ChocoSol T-shirts, vouchers as well as trial of our product at some Exhibitions or events in 2019.
With this approach, we will be encouraging retailers to stock our products and our particular aims are such as increasing in-store promotion by having retailers to engage in our promotional activities, gain more shelf space for our products.
With 95.6% as internet penetration rate of the USA population with 74.3% accessing Facebook according to (2017) Miniwatts Marketing group.
Looking at the penetration rate of internet in the country, we cannot miss advertising through social media whereby we will have a pop up link. If internet users click on it which will direct you to our website www.chocosoltraders.com. The objective is to create awareness of ChocoSol’s product through internet.
Let note that this won’t be considered as ABL advertising as the pop up will redirect you to our website.
Figure 3.1 Below-the-line Budget 2019
2019 BTL Budget (£100,000)
Items Unit Unit Cost Total Cost
ChocoSol T-Shirts & Free Chocolate 700 $ 10 $ 7 000
Trial products at Exhibitions 400 $ 6 $ 2 400
20% Discount Voucher Worth 1000 $ – $ 9 200
Discount Voucher’s creation 1000 $ 3 $ 3 000
Pop up link Creation for a one Year 1 $ 900 $ 900
Portable Trade show Display (10×10 square foot space) 2 $ 20 000 $ 40 000
Expenses 4 $ 1 500 $ 6 000
Exhibition Events Charge 5 $ 6 300 $ 31 500
• To create awareness of our products at 4 different Exhibitions and offer a spinning game to our consumers to win either free T-Shirt, chocolate or Discount vouchers to be used at our selected distributors. Same scenario, will be offered at our selected distributors or Retailers.
• Discount voucher will have a validity time of one month. This promotional activities will be specifically undertaken during Easter Festivity, Christmas, Halloween, National Chocolate day and USA Independence Day.
• Due to the budget constraint, I believe this will push demand of our products and result in more stocks from distributors.
**Discount which is given to consumers, will be refunded to distributors/retailers by us.
In case ChocoSol is intending to be a holistic marketing company. The company will have to align with below two points:
• Fairtrade-certified: this is one of the vital elements that ChocoSol has to align and sign if they are intending to be global entity. Why this? Being a Fairtrade-certified, it offers accessibility on high quality product at a cheaper price from certified famers. This will also grow the company revenue as raw products is acquired at a reasonable price compared to when they are no Fairtrade-certified.
• Risk taking: the company need to take a risk of borrowing money from a well-established financial institution to fund its operations’ expansion outside its country based and able to pay third party as per Fairtrade agreement.
Hill (p.446, 2013) echo that “Organizational structure refers to the norms and value systems that are shared among the employees of an organization.”
ChocoSol seems to be a one man business with a traditional structure approach which I find normal and accurate as a local company. But going globally, this might be a challenge for a sustainable leadership and management. ChocoSol should think of a structure that will give them a competitive advantage.
I would advise the company to have a Global Matrix structural approach as this approach will provide opportunity to use both centralized and decentralized. It allows for the rapid creation of efficient large-scale, project structures that employ many members of the organization’s functional structure without disrupting or destroying the structure in the process with benefits like efficient information exchange, increase motivation, improve the ability to access all the resources, enhance coordination across the organization, offers faster decentralized decisions, improve access to diverse range of skills, increase communication and coordination across the business. As every structure, this also has its downside. It shows a higher level of internal complexity, and some additional people management challenges.