Marketing Analysis & Strategy

Marketing is the knowledge and the management of the exchange relationship with an aim of creating value. Marketing in most cases is used to enable the creation, retention and the satisfaction of the involved customers. The focus is mainly geared towards the customers and therefore marketing can be described as a vital component in the business management together with being innovative and much more (Armstrong et al., 2015). The marketing concept identifies that for an organization or a business to be satisfied in terms of its main goals and objectives, there should be anticipation on both the wants and needs of the customers and give the customers total satisfaction more conveniently than the competitors.

Before every business can start its operations, there has to be unlimited market research in order get the best out of the products being retailed or the service one aims to offer. The market research can consist of data analysis to allow for the marketing activities to be included in the process and determining the information to be used in the business setting (MacDonald et al., 2016). The best marketing strategies can help in identifying the best customers, understanding what they require and implement an efficient method of marketing.  

Executive summary

The dairy industry is one of the most successful but delicate types of business since it basically deal with valuable and perishable commodities. There are many accrued benefits of being a farmer and at the same time processing the commodities for marketing. The dairy industry since the early 90s has been the backbone of the economy especially in the United States where thousands of people have turned into farming as the main source of livelihood (Armstrong et al., 2015). There has been a tremendous growth in this market since most people have discovered the secret benefit which comes from the dairy products. In countries like the United States, there has been a campaign for people to stop taking junk meals and foodstuffs and use the dairy products if they want to see their third generation which is a true case since the current alarming diseases are as a cause of junk food stuff. An interview with the managing director of daisy dairies which is a business in the dairy industry states that there are more than enough benefits in the dairy industry (MacDonald et al., 2016). There is an increased demand for the industry to globalize is a concern opportunity for entrepreneurs since this means that the market is rising to very high levels. On the question of how well is the supply for the raw materials for use in the farm, he responded that there is an ample supply of the dairy resources which are very vital in this line of business. On the question of how the market is in terms of milk production, he responded that there is a decrease in the cost of the daily feeds which has led to an increase in the amount of profit sharing in the market.

Marketing environmental analysis of the business

Competition is one of the hindrance factors to the growth of the dairy industry. All the dairy farmers in the market today depend on only one major source for their commodity which is the milk. For the dairy processors, there is basically no substitute making it a constant industry that depends on solely one type for its survivability.  Through the bargaining power of the dairy farms competition is created and since the market is not regulated, there are adverse effects as one company will want to buy the products cheaper (Von Keyserlingk et al., 2013). Many big companies are using their funds and resources to make sure that they stay in the industry as long as they wish through cutting the cost of the dairy products leaving the small farmers and companies with less market. This is so because when a major and the top dairy marketers make their products cheap, it gives them an advantage since they have a variety of products which will be bought through a large-scale method, therefore, gaining more profits than the small industries.

Socio-economic factors such as customer attitudes and the value of the customers is a major hindrance to the growth of the business. Currently, customers prefer to use the powder type of milk which is very expensive to develop in the small business entity (Von Keyserlingk et al., 2013). The powder milk is made available by the major companies as they have the capability and manpower to purchase and manufacture the products. With the ideology that the milk powder is safer and convenient for the customers, the major selling joints around the city have rejected and others forced to close down as a result of the milk going bad. Milk is a perishable commodity that needs a lot of care and should be consumed fast enough after there is a change in the environment. In this case, if there are no means to ensure that the milk will survive for more than the required time, then it is possible that there will be a loss.

Technological factors in the environment also hinder the growth of the dairy industry. The use of modern technology is a good thing to farmers and the consumers in general. This is because if a farmer is using technology and mostly the robot type in his or her business, then the workload will reduce and there will be time-saving as well it being cheap. The technology that is developed in many cases is full of too much detail which is hard for the farmers to read or understand therefore causing losses if the technology fails. The cost-benefit ratio of the machines used in the dairy industry is a hindering factor. The cost of purchasing the machines are way too high for a small scale farmer and therefore the ability to grow significantly reduces compared to other larger dairy producers who will find the cost cheaper compared to the workload available (Von Keyserlingk et al., 2013). The target market for the organization is mostly the local consumers and the general society. Supermarkets also offer a very good opportunity for the business since goods which are retailed in supermarkets tend to attract more customers and therefore building customer loyalty.  

SWOT analysis

Strength

Strengths of the business involve the fact that the livestock population can never lose value over time like other natural resources and therefore it is a dependable source of income for the farmer. Milk productivity from the animals can be very low but there are varying chances for improvements in terms of its production as there will be an increased surplus marketable milk processing. The purchasing power of the consumers is uprising due to the growing economy which is highly contributed to the increase in the middle-class population in America (Raiten & Aimone, 2017). This ideology allows the business to grow similarly as there is an increased demand for quality and affordable source of milk for home and personal consumption. With the increase in the rate of people who want to live a healthy lifestyle, milk is part of the dietary program for most of the people disregarding the religious beliefs or financial situation. This move to consume milk and other healthy products is a way to reduce the rate of obesity in the city and therefore leads to an increase in demand for the milk and other milk-related products (Grönroos & Grönroos, 2016). The location of the business is precisely situated in a place that is open and in most cases attracts both the local consumers and those that live in the urban centers.

The residues and agricultural by-products from the farms and other major processing companies present a cheap source for the dairy meals for the animals, therefore, saves on the funds that would have been used to purchase the dairy feeds which are at times very expensive and hard to get access to since there is stiff competition for any available dairy feeds. The dairy industry in the American world is on the rise and this can be attributed to the fact that there is a demand for a different kind of a job opportunity as a result of people shifting to agriculture. This can be termed as competition but there is an advantage that the monopoly market that used to exist in this region has shifted to being a shared market for the society (MacDonald et a., 2016). The business has currently employed a number of new staff who are well equipped with technology and machinery for the farms and is therefore in a position to implement technical manpower for the continued production of milk according to demand.

Weaknesses

The cross breeding programs known as the Hough have similarly increased the productivity of animals but it is very expensive for such a small company and therefore highly depends on the milk production from the traditional type of cows which yield less milk. This is a major impact for the company since there is a possibility for the company to produce large amounts of milk but restrained by the cost. Many big companies depend on cross breeding to get the best out of the programme and therefore increase the productivity of the company (Raiten & Aimone, 2017).  Poor supply of power and the bad conditions of the roads in the area presents a challenge for the business to grow. The bad conditions of the roads cause a delay in the delivery of products and also cause the cost of maintenance for the vehicles in transit to be very expensive for the company. The cost of having a cold store where the milk can be stored for a while before being transported to the various major cities is still very expensive and therefore the company cannot depend on such methods for storage. This leads to the company having to forego the delivery of milk to other parts of the country or the city to be hard and therefore loosing the market at the same time.

Since the company at times buys milk from the community as a way of increasing the rate of production, the milk purchased in many cases is of poor quality since most small-scale farmers do not know the various cheap ways of maintaining quality and clean methods of preservation (MacDonald et al., 2016). This can be a loss to the company since milk is a very perishable commodity and if not well preserved, it can go bad before it reaches the market. Comprehensive and a reliable data for milk production can be a problem to keep and therefore assessing the quality and the level of production will be a challenge. Data is required in order to show the past and the future of the company and since the cost of installation of the latest quality and available technology is expensive, the chances are that the data will be lost or misplaced once stored in manual form.

Opportunities

The environmental factors that act as a hindrance to growth offer a very great opportunity for the business to grow. Technology is one of the most advantageous methods of both supplying and preserving dairy products and the final products. Having implemented technology at the company there will an increase in the rate of production and also a reduction in the amount of money spent to pay the workers who will be working on the various processes. Technology comes with various advantages which can offer the best for a growing business (Grönroos & Grönroos, 2016). The economy in terms of dairy products demand is growing at a very high rate and if the business can take such a chance to be productive, then the marketing of the products will be simple and bring in more income. Once the company has gained a market loyalty due to offering quality dairy products, there is a chance that the company in the near future will globalize.

Threats

The climatic conditions for this region are so undependable and therefore the chances for a quality supply of the resources are a big issue for the company. Many times the company is forced to purchase feeds for the animals which are a big loss as the input is almost close to the output and therefore fewer profits. Indigenous species that are available in the farm produce fewer amounts of milk for sale and this presents a danger that could see the company lose valuable market while trying to care for the endangered species in the land (Raiten & Aimone, 2017). Indigenous species produce small quantity but which is very nutritious for human consumption and therefore if at any instance the cattle die that becomes the end of the company selling such kind of milk that is in demand since the next available cattle are crossbreeds and which are expensive to maintain. Quality parameters on how to preserve the milk is a challenge for the company.

Educating the society also can be very expensive and the company at the moment cannot afford such costs but there is a need for educating the society. There is a threat by the middlemen who cut cost and reduce the profits expected in the dairy industry. At all times in every type of business, middlemen are there to cut the cost or reduce the value of a product through retailing it at a cheaper cost. The company faces such threats since there in the market where it collects the milk, the cost of purchase has risen significantly for the past four months and therefore the profit earning capability is low since customers cannot accept to purchase expensive products while there are cheap ones (MacDonald et al., 2016). Multinational companies are a threat to small dairy companies that are just rising since they all want to take control of the market through acquiring the minor companies. This is a strategic move by the major companies to ensure that they dominate the dairy industry at all times.

Marketing objectives

The marketing objective for this dairy industry is for the business to grow to all the American states and in the general world. Exportation of dairy products is one way that the major companies are reaping profits from the available market and this presents a chance for growth. Dairy processing has been on the rise in the recent times and also internationally and therefore if the company concentrates on making quality products then there is a high possibility for a bright future (MacDonald et al., 2016). In terms of the revenue for the company, having already implemented a project to have the latest technology of preserving the milk and also that of milking, then the income for the company will rise at a percentage rate of above 30 percent. This is practically attributed to the fact that the current method of preserving and milking is very slow but at the same tine earning the company huge profits so in case the machines are used to work, the output will be higher than the manual method.    

Marketing strategies  

The key thing in achieving the said objectives is remaining in the market and also offering a chance for more and more people to be successful in this industry through helping one another. One of the strategies is building a good reputation in the community and the society involved. From the consumers, customers and the community that serves the company as a reliable source of milk. Establishing a good emotional connection will create brand loyalty (Grönroos & Grönroos, 2016). Supporting and maintaining a good communication and educational program with the society if possible. Once a company gets involved in the daily affairs of the community, there is a high chance for the company to get a backup in terms of the cheap source of labor and other benefits. Understanding the drivers of the economy or the target market for the dairy products is a good success strategy for the business. For example, the supermarkets have been the main market for the products. If the company understands the rate at which the supply of the dairy products is conducted then there is a high chance for achieving the market objectives timely and successfully.

The supply chain is also a strategy to understand the market. Businesses always conduct a market research to identify the weaknesses and the opportunities present for them (Armstrong et al., 2015). This can be done through listening to what the consumers need and what they do not like a certain product thus one can understand what to offer in the market. Being innovative is also a good strategy for success. The dairy industry is a competitive market and therefore being innovative in whatever service is a strategy that can enhance the growth of the business. Consumers are mostly attracted to products which are designed in the best way possible and which show some concern in terms packaging for retail. Attractive packets will always win the day. Environmental care can also be a good strategy for success. Maintaining the environment in most cases creates a good perception about the company involved and therefore allows the company to grow in the minds of people and creates brand loyalty (Grönroos & Grönroos, 2016). Understanding the supply base is always important since it allows the company to grow significantly from the economies of scale available for the business to grow.

 

 

 

 

References

Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction. Pearson Education.

Grönroos, C., & Grönroos, C. (2016). Internationalization strategies for services: a retrospective. Journal of Services Marketing, 30(2), 129-132.

MacDonald, J. M., Cessna, J., & Mosheim, R. (2016). Changing structure, financial risks, and government policy for the US dairy industry. United States Department of Agriculture, Economic Research Service.

Raiten, D. J., & Aimone, A. M. (2017). The intersection of climate/environment, food, nutrition and health: crisis and opportunity. Current opinion in biotechnology, 44, 52-62.

Von Keyserlingk, M. A. G., Martin, N. P., Kebreab, E., Knowlton, K. F., Grant, R. J., Stephenson, M., ... & Smith, S. I. (2013). Invited review: Sustainability of the US dairy industry. Journal of dairy science, 96(9), 5405-5425.