301 Communications Assignment PDF

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Executive Summary...................................................With the digital age advancing at rates that we have never experienced before it is important to the understand the market and where we should place ourselves in this market to ensure success after implementation. With strong market...

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Sam Russell

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Executive Summary With the digital age advancing at rates that we have never experienced before it is important to the understand the market and where we should place ourselves in this market to ensure success after implementation. With strong marketing objectives paired with clear direction of where you need to go will again ensure success. Assessing competitors and exploiting areas that have gaps in them will become import pre implementation of your business. The growth of this market is rising exponentially and forecasting to rise over the next 5-year period. Market leaders such as Noel Leeming and Harvey Norman will be your main competitors, but it will be also important to acknowledge the likes of PB Tech when gaining a gauge on the competition to see where you should head in future years. Rebranding will be an important step as I have recommended that you undertake a name change to give you store more of a professional feel, having a logo with important primary colors such and blue and orange and placing your store in an area with high foot traffic and an area for pairing will be become paramount for success when it comes to implementation of your business. I have recommended an option in this analysis. You should look to position yourselves at the top end of the spectrum of having a sleek store feel and having expert tech advice. This will create a sense of trust between consumers and your store ensuring a seamless shopping experience. Clear marketing objectives including building brand awareness, increasing sales exponentially over every month and promoting a store with a plethora of knowledge. Measuring this success will be vital in the future and we can achieve this through asking survey on YouTube ads, emailing previous consumers about customer service and their overall experience and general attitude surveys. We have defined a target market of high school student gamers of all income quintiles as there are now affordable computers for everyone. We must also identify other relevant target audiences such as small business/people working from home. School education should be another target audience we should look to exploit. All of this is explained in the following report. Further market research reports and website articles are used as a reference to help make smart and essential marketing decisions prior to the implementation of Hero Tech.

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Table of Contents Executive Summary...................................................1 Industry Overview......................................................3 Micro/Macro Environment Overview.........................3 Techno Freaks ‘R’ Us Rebranding and Brand Overview.....6

Key Marketing Objectives/ Target Markets.................7 Targeted Audiences/ Other Relevant Audiences.........8 Conclusions...............................................................8 References.................................................................9 Appendices...............................................................10

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Industry Overview The computer industry in NZ is seeing steady growth over all facets. In 2020 there was $1.4 billion in revenue generated. There has been a 4.7% increase in revenue from 2016-2021. Growth is expected to slow over the next 5 years with a 0.7% growth forecasted for 20212026. The industry saw $43.7 million in profit in 2020 with there being a profit growth of 3.4% between 2016-2021. 354 businesses now operate on a daily basis that sell computers and employ over 5,290 employees. The large number of employees has caused wages for computer stores to hit 296 million dollars for all employees - leading to wages being the biggest contributor for capital for businesses looking to open. Advances in technology have seen an increase in consumers buying tech related products. Not only are the advances in technology causing consumers to spend more on computers, but it is the affordable computers being released, causing consumers to continue to drive this market up exponentially. Rising consumer discretionary and positive consumer sentiment towards the market have been key trends contributing to growth. The COVID-19 pandemic saw interesting trends as more consumers invested in a computer due to the national lockdown so that they could work from home, however now due to the handling of COVID in NZ this will not benefit your business. (IBIS World, 2020) (The Scoop, 2021) Market leaders in this industry are Harvey Norman who have a 14.3% market share, Warehouse group, who own Noel Leeming, hold 11% market share and 74.7% of the market share is held by other small businesses such as PB Tech. (IBIS World, 2020)

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Micro/Macro Environment Overview To better understand the NZ computer market, we must conduct a competitor analysis. This will help us understand what our market competitors are doing and what you can learn from how they operate. Looking for market gaps for potential entry.

Competitor Analysis Noel Leeming

Noel Leeming operate a smooth-running business on all facets besides consumer experience. Key strengths lie in the size of the business and the fact that it is well established within the market. As a result of them being such a prominent market figure they have the ability to hold large amounts of stock which will result in consumers having a plethora of options. High bulk buying power will also help with this. A gap in the market we could look to exploit is their customer service. They generally do not hire people experienced in the computer market as their brand stocks more than just computers therefore hiring people with general tech knowledge. After speaking to a recent customer from Noel Leeming they said employees “lacked passion” and had “no real interest” in what the consumer wanted (Customer 1, Personal Communication 2021). This shows that when we hit the market with Techno Freaks, we must embed a culture of warmth and passion offering advice that consumers can only obtain from us. Warmth will give the consumers a sense of trust when shopping with us and will ensure their return to our store. Consumers in the market need an abundance of information prior to the point of purchase. This will remain paramount for your business in the future. We must look to implement similar systems including their ‘click and collect’ system (Warehouse Group Annual Report). This is beneficial to consumers as it saves them the hassle of coming into the store physically and spending hours deciding what they want. Noel Leeming pair their new AI system alongside the click and collect system ensures seamless purchasing through their online website. Noel Leeming’s price guarantee is a tactic used very effectively which is worth employing to your business as they will constantly match your prices, making it hard for us to differ from the market. The computer market in NZ is homogenous meaning all stores stock the same products, to differ from these brands we must look to implement something similar to give us an edge over our competitors (IBIS World).

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Critical Success Factors To help understand the macro environment of the market we must identify critical success factors that we can implement for your business. 1. Employing Knowledgeable staff We have already seen that consumers are turned off by stores lacking employees with passion and real knowledge after consulting (Customer 1, Personal Communications, 2021) and asking about their experience. Through employing staff that are knowledgeable we can see the benefits of this. Things such as improved culture increases ethical behavior thus leading to more trust from consumers when purchasing our products. Customer service will only get better. According to the (American Express Customer Service Barometer) 99% of consumers surveyed say, getting a satisfactory answer or being connected to someone knowledgeable are the important prerequisites to great customer experience. 2. Attractive Store Layout We must look to adapt a storefront that is pleasing to the eye but displays all stock in a way that consumers find easy to navigate. After visiting both Noel Leeming in Palmerston North and PB Tech in Wellington I have taken important aspects of layouts from both stores that should be incorporated. Noel Leeming Layout

PB Tech Layout

One thing we should look to adapt from Noel Leeming is the limited clutter surrounding their products. This gives the store a clean feel and is easy for consumers to navigate to the products they require. Noel Leeming lacks clear signage, however PB Tech does this well and displays signs above each relevant area of the store so that consumers know where in the store the products they need are. If we combine these 2 aspects consumers should have seamless and efficient shopping for consumers.

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Techno Freaks ‘R’ Us Rebranding and Brand Overview After researching I would request a brand name change. Our target market is high school gamers indicating to us that they will not want to shop at a store that resonates with stores like Toys “R’ Us. They are dealing with complex computers not childish toys. I would recommend changing your name to ‘Hero Tech’. This name is short and snappy and gives off impressions that the people working here are heroes and will help with all your computer needs. “Hero” resonates soundly with gaming thus giving it authenticity to attract our target market. Here is a logo I have designed (Appendix Item 1) We should position ourselves in the market near the top of our perceptual map displayed in Appendix Item 2. The perceptual map measured the luxury feel of the store and the tech advice one would receive if they shopped there. I chose the 2 market leaders and PB Tech as competitors. In order to attract our target market, you should look to place yourselves high in both the luxurious store feel and expert tech advice. Gamers need to be able to access this advice coming into the store so that they can make informed decisions and be able to do so in a store that does not feel cluttered and is visually appealing. This makes them feel comfortable enough inside the store to make purchases. This embodiment of warmth inside the store is presented through the expert advice from employees. Our suite of products needs to be extensive so that all needs are catered for. As the computer market is homogenous the range of products offered by Hero Tech need to align with our competition. To differ from the market, we should offer top of line accessories and additions so that if people were to build their own PCs for gaming, they can purchase these. Noel Leeming and Harvey Norman do not offer this and thus we can see that this is exploitable. The experience and services consumers gain from your store need to align with a sense of knowledge, warmth and passion towards computers. You will not stock anything else besides computers and accessories, so employees need to be hired that have extensive knowledge on these. The logo presents primary colors which appeal to the human eye. The color blue is used as the main background color, it is known for its trust and dependability. It's reliable, responsible, and mentally soothing. It has a professional and clean look. Yellow is used to ‘lighten the mood’ when looking at the logo and contrasts well with the blue making it also look visually appealing. Orange is used to creates discomfort and can be used to create a sense of anxiety that can draw in impulsive buyers and window shoppers. It also resonates with warmth and when mixed with the aforementioned colours gives a clean and sleek look. (Co Schedule, 2018) We should look to place our stores in high foot traffic areas throughout major main cities in NZ. If we take Wellington for example we must look to find a commercial building of a similar size to PB Tech, this should provide adequate storage space for a start-up business in high foot traffic areas such as Lambton Quay. On average 4,003 pedestrians cross past Lambton Quay per hour (Stuff, 2011). This may cause issues due to the limited parking areas surrounding this area. An alternative option to this location could be around Vivian Street where Noel Leeming is located as this has an accessible car park.

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Sam Russell

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Key Marketing Objectives/ Target Market Our target market, that we need to exploit, are high school gamers in the age range of 13-18. Computers have moved from being an expensive good to being an affordable item for most households in the past 5 years, meaning we should look to target all consumers in this age range as there will be a computer for everyone based on their needs (IBIS World, 2020). We can segment the market using benefit segmentation. This segmentation focuses on a market who will profit the most from our business being implemented. We know our target market will benefit from this. Therefore, we need to also include preemptive strategy. This strategy outlines that “We offer you something others cannot”. This is useful as we are in a market where our products have few functional differences. This point of difference lies in our customer service mixed with the luxurious feel of the store. Noel Leeming/Harvey Norman offer a luxurious feel in their stores but not expert advice while PB Tech offers expert advice but a cluttered feeling. We must also offer services such as instillation, building of Pcs and repairs for computers still under warranty and outside of warranty at a cost to continue that trust between consumers and your brand. This pre-emptive strategy will allow us to exploit both of these successful facets adapted by our competition to lead to inevitable success. This needs to be communicated in our advertising towards our target market to notify them we have a point of difference. Prior to entering the market there needs to be clear marketing objectives that are measurable and obtainable to help measure the future success of Hero Tech. 1. Increase Brand Awareness over 3 years This is a key objective for your business as the more consumers that know about your brand, the more sales it will generate. Advertising in student dense areas will be important. Billboards on routes from schools to school zone housing must be utilized. This alongside advertising in gamer-related YouTube ads will have a large impact. To measure this success, we must ask a small sample of our target market if they have heard of your brand now and in 3 years. Record the difference to see the impact. 2. Increase sales exponentially every month over 3 years Growth for a new busines is essential. Developing a strong connection with our target market will ensure sales rise over time. The first 3 years of a new business are essential to build relationships which will be beneficial down the line. We need effective feedback to to improve your product, service, and/or solution. You’re trying to find the right fit for what you sell, in a way that will benefit your customers more than it costs them to buy from you (Next Web, 2013). 3. Promote a store that has a plethora of knowledge This will be crucial for the success of our business. As aforementioned in this report, having staff who are knowledgeable about computers will ensure trust between consumers and the business, signalling long time success. A way to measure this could be an email that gets sent out asking about how our business compared to competitors regarding advice. This way we can keep on top of how consumers feel about our ability to help.

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Targeted Audiences/ Other Relevant Audiences To reach other valuable consumers we must look beyond catering for our target market of high school gamers. Small Business Owners/ Workers Working from Home This is a relevant audience we need to be targeting. The COVID 19 pandemic saw increased computer sales due to the enforced lockdown (IBIS World, 2020). Now that NZ has dealt with COVID less people are working from home. However, there is still a small majority of independent small business owners who will still be needing computers. We must target these consumers as the tasks that they need to fulfill on a daily basis, such as emails and operating their websites, will still need to continue. We can see this need is still there as the PC market has grown year by year by 12.3% in terms of shipping units to 826,000 units. (Scoop, 2021) School Education Another relevant target market we need to be targeting. Laptop sales have seen a rise as schools are now making it compulsory for students Year 4 upwards to have computer access. After conversing with (Customer 1, Personal Communications,2021) it was revealed that she had just purchased her son a laptop for school due to him heading into Year 4 in 2022. Not only consumers purchasing laptops but schools purchasing laptops for lower income households for children who cannot afford access to them. Advertising through channels in school newsletters would be a fruitful avenue to exploit to increase brand awareness.

Conclusions Throughout this report I have mentioned numerous key recommendations I think you should implement for your business Hero Tech. Implementing knowledgeable staff will enhance success of the business through trust, paired with a guarantee that consumers can come to employees with repairs and issues, and they will be fixed accordingly will be crucial. The rebranding of the store and giving it a sleek feel will ensure consumers have a seamless shopping experience and will continue to re purchase form our store. The extensive product range stretching past just computer into items like gaming accessories and general computer accessories will be essential to the success of the implantation of your brand. Gauging what competitors are doing in the market, especially market leaders including Noel Leeming will become increasingly important to future success, as these stores have been operating for a long time and understand how the market works. Whilst they are still competitors, they give us a plethora of knowledge to ensure success.

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References Morris, T. (2015, October 23). 7 Big Benefits of Giving Employees the Knowledge They Need. Business 2 Community. https://www.business2community.com/human-resources/7big-benefits-of-giving-employees-the-knowledge-they-need-01360535 Computer and Computer Peripheral Retailing in New Zealand. (2021). https://www.ibisworld.com/nz/industry/computer-peripheral-retailing/1836/ Customer 1 (Sarah Russell – Consent Given) Personal Communications 12/04/2021 Hauff, A., & Hauff, A. (2018, August 29). The Know It All Guide To Color Psychology In Marketing + The Best Hex Chart 70. CoSchedule Blog. Stuff.co.nz. (2011, January 18). Lambton Quay has highest foot count. Stuff. https://www.stuff.co.nz/business/industries/4554933/Lambton-Quay-has-highest-footcount Express, A. (2015). Culture improves customer service. About.Americanexpress.Com. https://about.americanexpress.com/news/pr/2014/outstanding-service-spend-morespread-word.aspx New Zealand PC Market Has Strongest Year Ever In 2020 | Scoop News. (2021). The Scoop. https://www.scoop.co.nz/stories/BU2103/S00360/new-zealand-pc-market-hasstrongest-year-ever-in-2020.htm Schwartz, G. (2021, March 19). 6 ways startups can improve sales lead generation (without selling their soul). TNW | Entrepreneur. https://thenextweb.com/news/6-easy-waysstartups-boost-sales-leads-sell-authentically

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Appendices Appendix Item 1

Appendix Item 2

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