Marketing plan

Introduction

Gymshark has had great success in the sportswear department especially with its direct approach of not only approaching customers, but also making its products and services available with great ease.  The lack of brick and mortar premises has pushed the company towards improving the process between purchase and delivery.  The improvement in service delivery, combined with the quality of service and products offered have made the Gymshark a dominant player in the sportswear industry.  With growing trends in technology and consumers constant need for convenience, Gymshark is likely to benefit from trends such as the growing popularity for e-commerce.  The company is likely to find it easier to reach its customers, market its products and services, and increase its reach.  However, despite the growing popularity for e-commerce and a flexible business culture, Gymshark needs to establish brick and mortar stores in order to attract clients who are yet to catch up with recent trends or those that opt to stick to traditional forms of business.

While Gymshark has a large market share in the regions it operates in,  whatever profits made are in no way a reflection of the company's potential for growth or dominance in the market because it is yet to satisfy a market niche that most of its competitors have already ventured into.  While its strategy has proved successful over the year, Gymshark's decision to refrain from brick n mortar premises means that it has closed out potential customers that prefer to shop in business premises rather than online.  This combined with the ease in selling products and services through e-commerce have made it challenging for Gymshark to compete with other companies in the market it operates in especially with their physical and online presence.  It is therefore recommended that the company considers investing in brick and mortar premises so as to increase the number of customers seeking out its products and services.

One major reason why Gymshark should start its own brick and mortar premises lies in the potential to build the company brand.  Despite the loyal following demonstrated by Gymshark customers, most of their loyalty is to the products and not the company itself.  This is especially because customers have had the chance to experience and use the products but are yet to associate them with a tangible company (Kuczwara, 2017).  Even with a well-established name, the company's identity greatly lies on the company brand as it is often what new customers consider when purchasing products. There is also the issue where customer tastes and preferences keep changing.  Since the customer loyalty is to the products, the company is constantly at risk of losing customers if they are dissatisfied with a product or they get better products from the competitors (Kuczwara, 2017).  If the company establishes brick and mortar premises,  it will be able to create a physical identity as well as corporate image whose brand is associated with all the products and services provided by Gymshark.  Customers will be able to associate the products with a physical business, and therefore owe their loyalty to both the company and its products.

Brick and mortar premises are also advantageous in that they trigger impulse buying from customers.  When buyers shop through e-commerce, their purchases are mostly limited to the products they sought out to buy.  This is especially because of the added features in online shopping that allow customers to filter out other products that bear no relevance to the item they wish to purchase (Adler, 2014).  Although there are advertisements to entice customers into buying more, the likelihood of it happening is relatively low especially because of the extensive research that customers do before making online purchases.  In the case of brick and mortar premises however, customers have to look through a variety of other products while seeking out the product they wish to buy.  Walking through a physical shop offers more variety than an online one because customers cannot filter through all other products (Adler, 2014).  When customers see other products, they are more likely to engage in impulse buying and in this could greatly boost sales for the company. Impulse buying is also encouraged when the company displays luxurious products on its shelves.  Customers are likely to associate the luxurious products with quality and specialty which is likely to create customer loyalty as well as increase the chance of repeat buying.

PESTEL ANALYSIS

The PESTEL analysis can help the company to better identify the market it seeks to exploit as well as come up with the best approach when starting the brick and mortar premises. 

Political

At present, the success of the company is limited by politics governing countries that the company operates in especially in relation to online interactions.  The lack of physical shops means that customers have to use services like e-commerce when making purchases.  However, in countries like China where access to the internet is controlled by the government, Gymshark may find it difficult to reach customers in such regions due to the red tape around internet use (Qing, 2010).  If physical premises were introduced, it would help the company to overcome the political barrier and penetrate markets it was unable to in the past.

Economic

The state of the economy greatly influences people's spending power.  Since Gymshark deals in sportswear, customers buy more from convenience than necessity (Qing, 2010).  The economy can therefore determine the sales made and the company should try and market its products as being affordable so as to attract customers even when the economy is low.

Socio

Customer purchase decision is greatly influenced by trends and opinions in society. The socio factors therefore determine the reception that specific products get in the market and Gymshark should strive to create a positive image so as to attract customers seeking out high quality products (Qing, 2010). Understanding the social factors that govern society can also help the company to anticipate the target customers’ needs and offer products designed to meet them

Technological

            Lack of physical business premises requires lot of online transactions as this is the best way to ensure that products make their way from the manufacturers to the customers. Technology is therefore a crucial element in the delivery of service between Gymshark and its customers (Qing, 2010). With advancements in technology, the company should ensure that it has state of the art equipment and that customers get the best access to products and any relevant information needed in helping them to make the purchase decision. Technological trends are therefore likely to influence the business decision and the company needs to be updated on the changes in the industry as well as changes in customer tastes and preferences.

Environmental

Another factor that the company needs to consider is the impact that doing business will have on the environment it operates in and what can be done to improve it. With recent trends focusing on global warming and the need to preserve the environment, the brick and mortar premises that the company could build should factor in the impact that the business will have and how it be received by the target customers (Qing, 2010). Projects like cleaning up the environment, helping the needy and giving to charity are likely to have a positive impact and could help build lasting relationships with the customers.

Legal

            Gymshark also needs to abide to the laws and regulations that govern the regions it seeks to operate in not only through the web, but also through the brick and mortar premises it could start. The business should abide to laws regarding marketing approaches, how to treat employees and also salaries and wages, to mention a few (Qing, 2010). Observing laws and regulations will ensure that the company avoids lawsuits and that its operations are not constantly halted by government interference.

Porters Five Forces Model

            Gymshark can also use Porter’s five forces model to better understand its environment, the competition and how to achieve success in its chosen market. The company should try and control supplier power by having more than one supplier who can provide services and raw materials (CGMA, 2013). A variety of suppliers prevents them from controlling pricing as there is a variety to choose from, all of which try to attract manufacturers with their low prices and quality of service. Since the aim is to start brick and mortar premises, the suppliers will play a major role in ensuring that the products make it to the premises in good time. Another force that the company must keep in check is the buyer power (CGMA, 2013). Since customers always seek the lowest prices, controlling the buyer power will ensure that products are sold at relevant prices that do not overcharge the customers but still offer quality products and services. One way to achieve this is by attracting more customers to create more demand and this can be achieved through the brick and mortar premises as they will attract new customers.

            The company also needs to deal with competition rivalry. Gymshark’s dominance in the markets it operates in is greatly challenged by the existence of competitors. The competition poses more risks especially because most of the competitors have brick and mortar premises, and therefore a physical presence. In order to maintain its competitive edge, Gymshark must find ways to beat the competition and one way to achieve this is through the brick and mortar premises as they are likely to bring in more customers as well as assert the company’s physical presence in the markets it operates in (CGMA, 2013). The company must also deal with the threat of new entry as this will greatly reduce the level of competition. With growing trends for healthier lifestyles, more businesses are likely to come up offering sportswear for customers seeking to exercise and stay in good shape. Limiting new entrants will not only reduce competition but also increase the number of potential customers that the company could serve (CGMA, 2013). The company also needs to address the threat of substitution by ensuring that the products and services it offers are of the highest quality. Offering the best quality at affordable prices will give customers value for their money and discourage them from seeking out different products elsewhere.

SWOT analysis

Other than understanding the market it operates in Gymshark also needs to understand its position in the market and how best to exploit the opportunities present and overcome the challenges and this can be achieved through a SWOT analysis of the company. One of the company’s major strength is its strong online presence. Despite the lack of physical premises, Gymshark has established a strong following on the web and a significant number of people know its brand and choose its products over others in the market. The strong relationships that the company has with its customers are also strength for Gymshark. The customer loyalty ensures that there is constant demand for the products and services and this gives the company a competitive edge.

            The major weakness that Gymshark has is the lack of brick and mortar premises. While the decision to operate through e-commerce does make the company more flexible, it locks out potential; customers who prefer physical shopping than doing it online. The lack of physical premises is a weakness in that; it locks out potential customers who would otherwise increase sales for the company. The company however has opportunities that it could use to its advantage such as the various technological advancements. The introduction of e-commerce and its growing popularity has made it easier for Gymshark to access customers and make its products available. Another opportunity is the current trend that has created demand for healthier lifestyles. People seeking out sportswear with the aim of keeping fit are likely to increase the demand for athletic equipment and Gymshark is likely to benefit from the increase in demand for such products. The company must however overcome its major threat which is competition. With various recognized companies offering similar products in the sports industry, Gymshark must constantly upgrade its services and products in order to maintain a competitive edge.

Marketing objectives

In order to grow and increase its market share, Gymshark needs to set clear and precise objectives to help attract more customers and increase sales.  One of the main objectives is to establish brick and mortar premises that aim to serve customers who are not used to shopping online. Another objective is to build the company domain such that Gymshark is ranked among the top organizations for searches related to sportswear on the web. Lastly, the company will also strive to improve engagement with customers through promotions conducted online and in the brick and mortar premises owned by the company.

Marketing strategy

            The marketing strategy will employ the use of the segmentation, targeting and positioning model when selecting the market to set up brick and mortar premises.

• Market segmentation

The segmentation will involve dividing the market into different segments in order to identify which areas to exploit.  It will consider factors such as demographics which relate to the customer’s income, age, gender and education to mention a few. Psychographics will be another factor used to help the company understand what pushes customers to make purchases (Hanlon, 2018). Understanding people’s behaviors, hobbies and lifestyles will be helpful when determining what products to offer to the target customers. Lifestyles are also a factor as the company must identify what lifestyles create demand for sporting goods and how best to exploit them. Hobbies and recreational activities for example will help determine the type of products to sell in order to attract people who engage in the relative sporting activities in the form of hobbies.

• Targeting

After dividing the market into different segments, the next step is to identify which segment is the best to set up physical premises in. Segments that offer the most opportunities for the company to make profits as well as have the best potential for growth should be prioritized as they hold the best opportunities for the company (Hanlon, 2018). The segments should also be large enough to allow for growth and also to ensure that the company can still benefit even when competition intensifies.

• Positioning

Lastly, the company must position itself in the market targeted by coming up with the best approach to enter the market and assert its dominance. To achieve this, the company can rely on a well laid out and implemented marketing mix.

The company should ensure that the products it sells are of the highest quality and that they give customers value for their money. Other than the product, the company can also share information regarding the products and services through emails, social media and direct marketing. In relation to price, setting prices that are relatively low and give value for money will encourage customers to choose Gymshark products over others in the market (Martin, 2014). The prices can also be used to convince customers of the quality of the products sold especially in the case of luxurious products. Since the goal is to set up physical premises, the place should be selected with emphasis on offering convenience. The shops stores should be set up in areas that are easily accessible, have enough traffic and secure enough to put customers at ease while shopping. An online presence should also be created for the brick and mortar stores to ensure that customers have all the avenues to conduct research before going to the actual shops (Richter, 2012). Lastly, the company should use different forms of advertising to promote its new premises and the products sold there. Online advertisements, television ads and magazine publications can greatly help in notifying potential customers about the new stores and the products and services there as well as any relevant information that will push sales.

Conclusion

Gymshark has been quite successful in the market especially due to the online presence it commands. However, in order to grow and increase sales, there is need to attract new customers and this can be achieved through Brick and mortar premises. This is especially because the lack of physical premises locks out potential customers who do not, or opt not to make purchases online. The company should therefore invest in market research aimed at identifying potential locations for brick and mortar premises so as to attract new customers.

 

 

 

 

 

 

 

 

 

References

Adler E, (2015) “Brick and Mortar retailers have one big advantage over ecommerce companies”             Business Insider, retrieved from, https://www.businessinsider.com/bricks-and-mortar-       retailers-have-one-big-advantage-over-e-commerce-companies-2014-7?IR=T

CGMA, (2013) “Porters five forces of competitive position analysis” retrieved from,             https://www.cgma.org/resources/tools/essential-tools/porters-five-forces.html

Hanlon A, (2018) “The segmentation, targeting and positioning model” Smart Insights, retrieved             from, https://www.smartinsights.com/digital-marketing-strategy/customer-segmentation-            targeting/segmentation-targeting-and-positioning/

Kuczwara D, (2017) “Brick and Mortar vs ecommerce stores: How to leverage the best of both” retrieved from, https://www.business.com/articles/brick-and-mortar-vs-ecommerce-  stores/

Martin, (2014) “Understanding the marketing mix concept: 4p’s” retrieved from,             https://www.cleverism.com/understanding-marketing-mix-concept-4ps/

Richter, T. (2012). International marketing mix management: Theoretical framework,      contingency factors and empirical findings from world-markets. Berlin: Logos.