Identifying a New Market Segment for an Eco-Friendly Business in the UK
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Course
Strategic Marketing Management (7MK032)
Institution
University Of Wolverhampton
The University of Wolverhampton's Postgraduate Module; Strategic Marketing Management required the writing of this report as part of the assignment. The goal of the report was to locate a fresh market niche in the UK for an eco-friendly company that serves as the trading arm of a nonprofit group. T...
Contents
Strategic Marketing Management Assignment .................................................................................. 1
Introduction............................................................................................................................................ 4
Vision...................................................................................................................................................... 4
Macroeconomic Analysis .................................................................................................................... 5
➢ Political - .................................................................................................................................... 5
➢ Economic -................................................................................................................................. 5
➢ Socio-Cultural - ......................................................................................................................... 6
➢ Technology –............................................................................................................................. 6
➢ Legal - ........................................................................................................................................ 7
➢ Environment -............................................................................................................................ 7
Microeconomic Analysis ...................................................................................................................... 8
➢ Strengths - ................................................................................................................................. 8
➢ Weaknesses - ........................................................................................................................... 8
➢ Opportunities - .......................................................................................................................... 9
➢ Threats -..................................................................................................................................... 9
Competitor Analysis ........................................................................................................................... 10
STP Process ....................................................................................................................................... 10
Segmentation .................................................................................................................................. 11
Figure 1 – Consumer Influences (Baines and Fill, 2014, p.208)......................................... 11
Targeting.......................................................................................................................................... 13
Figure 2 – Total DAMP Scores ................................................................................................ 13
Positioning ....................................................................................................................................... 15
Figure 3 - Perceptual Map ....................................................................................................... 16
Marketing Mix...................................................................................................................................... 18
Product ............................................................................................................................................. 18
Figure 4 - The Three Elements of a Proposition (Baines et al, 2019, p.309).................... 19
Price ................................................................................................................................................. 20
Place ................................................................................................................................................ 20
Promotion ........................................................................................................................................ 21
Figure 5 – Which Channels have Gen Z discovered new products on the past three
months (HubSpot,2022) ............................................................................................................ 22
People .............................................................................................................................................. 23
Process- ........................................................................................................................................... 24
Physical Evidence .......................................................................................................................... 24
Budget .................................................................................................................................................. 25
,Control Measures / Evaluation ......................................................................................................... 25
Figure 6 - Activity Implementation ........................................................................................... 26
Conclusion ........................................................................................................................................... 27
References .......................................................................................................................................... 28
Appendix .............................................................................................................................................. 33
Appendix A - PESTLE ................................................................................................................... 33
Appendix B – Competitor Analysis (Porter’s Five Forces) ....................................................... 34
Appendix C - Segment 2 DAMP .............................................................................................. 36
Appendix D – Krizevac Project Eco-Social Achievements ...................................................... 39
Appendix E – Income and Expenses .......................................................................................... 40
Appendix F – Google Analytics .................................................................................................... 41
,Introduction
Cycle of Good is one of the many fundraising initiatives of Krizevac, a charity
specializing in creating Social Enterprises in some of the most disadvantaged
communities in the world. The parent company i.e., Krizevac Project is underpinned
by Catholic Social Teaching to achieve sustainable enterprising changes in the said
communities by providing high quality education, setting up enterprises through
Catholic Communities that benefit people of all faith and none (Cycle of Good, n.d.).
Located in Chilomoni Township, Malawi,currently employing 33 Malawian Tailors full
time, the organization collects waste inner tubes and other materials saved from the
landfill, ship them in their own containers with donated bicycles to Malawi where in-
house trained tailors from poorest communities, carefully craft waste into useful, vegan
and eco-friendly gift items (Cycle Of Good, n.d.).
Cycle of Good product portfolio includes Bags, Belts, Cards and Gift Bags, Cases
(Pencil, Glass), Decorations, Elephant Bike, Face Coverings, Key Rings, Purses,
Stationery and wallets all of which are recycled from Banana Pulp, Coffee Sacks,
Copper Wire, Drink Cans, Inner Tubes, Larry Curtains, Newsprint, Paper, Polyester
and Postal Bike (Cycle of Good, n.d.).
Vision
By 2033, the parent company of Cycle of Good intends to construct and install 15
Krizevac crosses, each on a mountain in a different African nation. The communities
surrounding these Krizevac crosses will become, like the village of Medjugorje, a
source of profound peace and inspiration for those who visit and live there (Krizevac
Project, n.d.).
The company is based on the following Ethos.
• Value people, including team members and their consumers, and treat them
fairly.
• Value resources by reducing waste, recycling and being eco-conscious
throughout their operations.
, • Be creative and practical in their innovations by only producing useful and
durable products.
(Cycle Of Good, n.d.).
Macroeconomic Analysis
For the purpose of this report, a PESTLE analysis was conducted to comprehend the
external market in which Cycle of Good operates. Below is a PESTLE analysis of the
major aspects of this report and their direct impact on Cycle of Good. Appendix A
provides a comprehensive PESTLE analysis of published data on the Charities
Industry.
➢ Political –
The recent transfer of political power between the two parties in the United Kingdom
is an unavoidable political aspect of this report. Rishi Sunak is the United Kingdom's
third Prime Minister in four months. Jeremy Hunt is the fourth chancellor in this time
frame. With these changes in power comes uncertainty regarding the continuation of
government funding programmes already in place for non-profit organisations (The
Guardian,2022).
This report will focus on how Cycle of Good, henceforth referred to as COG/CoG, can
seek international support from Charitable Grant Makers within UK market segments
such as the National Lottery in order to mitigate the operational and financial risks that
these actions may cause.
➢ Economic –
According to IBIS (2022), the low household income recorded in recent years in the
United Kingdom is one of the primary concerns for the non-profit sector. Increases in
the CPI and CPIH, which currently stand at 10.1% and 8.8%, respectively, are
primarily responsible for this further decline. It is important to consider the impact this
may have on the charities industry and COG, as it may affect people's ability to donate
to charities (Mintel, 2022). Maslow (1970) determined that people will only spend
money on self-actualizing activities such as donations only if their basic needs have
,been met. COG may need to incorporate strategies to reach out to the 23% of UK
residents who are confident in their ability to thrive amidst the country's chaotic
economic crisis (Mintel,2022).
This emphasises the significance of financial independence for COG, the trading arm
of the Krizvac Project.
The emergence of the Ethical Consumption market would also be of interest to COG.
This will be covered in depth in the latter portion of the report.
➢ Socio-Cultural –
According to the Community Life Survey for the years 2020/21, the percentage of
individuals over the age of 16 who volunteered at least once a month for a formal
organisation decreased to 17% from 23% in 2019/20, and the percentage of
individuals who volunteered at least once a year decreased to 30% from 37%. (Martin,
2021). This may hinder COG's ability to recruit volunteers for operations in Malawi and
the United Kingdom.
Moreover, consumers are becoming more conscious of the impact of their purchases
on society and the environment, particularly gifts and accessories. This shift in
consumer behaviour is significant to COD, and by capitalising on these growing market
segments of Eco-socially conscious consumers, COD would be able to expand their
customer base while also achieving its own sustainability and social goals
(Mintel,2022).
In addition to the aforementioned Socio-Cultural development in the external market,
Appendix A discusses a change in consumer psychology from "activism" to
"consumerism" in the same area (Tilley, 2021).
➢ Technology –
According to Jones (2022), social media has become indispensable for charities
during COVID-19. Important social media platforms, such as Instagram, Facebook,
LinkedIn, and Twitter, continue to play a crucial role in spreading awareness and
raising funds. Newly popular platforms, such as TikTok, Snapchat, and Clubhouse,
, enable charities to expand their reach. Each platform provides charities with ample
opportunities to communicate with potential donors, reach a new audience, and raise
awareness about essential aspects of service delivery.
Moreover, Charity Digital (2021) asserts that Blockchain's verifiable trail of
transactions has contributed to the transparency of the use of funds by allowing donors
to track their donations. And by utilising Blockchain to mine the unused processing
power of donors, platforms like Give Byte aggregate and convert unused computing
capacity into funds for charitable organisations.
➢ Legal –
In certain circumstances, charities already have a statutory authority that allows them
to pay trustees for providing a service to the charity beyond the trustee's regular duties,
or for goods related to that service.
By virtue of the Charities Act of 2022, this statutory authority is being modified.
Consequently, charities will be able to pay trustees for providing goods and services to
the charity in certain circumstances (The Charity Commission, 2022). This may be of
utmost importance to COG in attracting top talent from the United Kingdom and around
the world and expanding their presence.
➢ Environment –
One of COG's primary objectives is to help preserve the environment. This is a crucial
aspect of COG's future business and directly aligns with internal and external
stakeholders' expectations. This is evident by the shift from activism to consumerism
in consumer purchasing behaviour. According to Petro (2021), 45 percent of
consumers are willing to pay more for environmentally friendly products. These
alterations in consumer purchasing behaviour would enable COG to maintain a higher
profit margin by selling their products at a higher price than at present.
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