Domestic and host market trends, страница 3

5.3  Promotion

Promotion of the products will take place in different ways and through different channels and means. First one is Internet. In the different social chains like facebook (worldwide social chain) and studiverzeichnis (German social chain) artificial pages will be created. These web pages will look like pages of normal people. On the main photo will be women in the Walenki Filz production. These “web – people” will invite people to visit their pages where everyone can see reference to the website of the company.

The second type of promotion will be BTL actions. They will include fashion shows close to the point of sales,  the stores. Models will walk near the stores wearing Walenki Filz product. They will invite people to visit store and demonstrate different products.

The promotion plan will be discussed further in advertising contest section.

6.  GRID-analysis

                The starting point of product GRID-analysis was an introduction (repetition) of “WF” Marketing Mix, which was intended to create a clear understanding of product, distribution, pricing and promotional tools of a company’s strategy.

                The second part of GRID-analysis provided PEST-analysis of the external environment for the organization. The results were represented in a consistent manner:

1)  Political factors:

a.  According to the present coalition government’s policy document, German policy will be driven towards promoting peace, resolving and preventing conflict, alleviating poverty and fighting terrorism.

b.  Starting a business in Germany takes an average of 18 days, compared to the world average of 38 days.

c.  Furthermore, obtaining a business license requires less than the world average of 18 procedures and 225 days.

2)  Economic factors:

a.  The GDP growth in Germany averaged 1.4% during the seven year period 2000–08, which is significantly lower than the growth rate of 1.9% per annum achieved during 1990–99.

b.  Germany has cut its GHG emissions to levels that are below those specified by the Kyoto protocol.

3)  Social factors:

a.  Germany has the most advanced healthcare system among the EU nations. Health insurance is fully commercialized and highly decentralized with both private and state-owned insurance players.

b.  Germany has high literacy rates but continues to be plagued with a severe shortage of software specialists, engineers and other skilled workers.

4)  Technological factors:

a.  Germany’s total expenditure on R&D, by both the public and private sectors, as a percentage of GDP in 2007 was 2.25%. The government intends to increase its expenditure on R&D to approximately 3% of the country's GDP by 2010.

b.  Germany is rapidly transforming itself into a knowledge-based economy.

                After that we compiled Marketing Mix with PEST-analysis and worked out the GRID, which can be depicted in this way:

     The white points depict no significant connection between both factors, while the red ones depict the presence of the connection between the factors.

                The fist correlation that we have found was “Economic-Price”. This correlation is quite obvious. The fact that the GDP growth in Germany averaged 1.4% during the seven year period 2000–08, which is significantly lower than the growth rate of 1.9% per annum achieved during 1990–99 and the recession period cause the lower pricing rate that the competitors have. We assume that our direct competitor is “Uggs” firm that can be characterized as an upper-market participant. So “WF” product line is cheaper than one of “Uggs”.

                The next correlation found between Social factors and the product can be explained by overall trends among young German people. The information was taken from Euromonitor International report and can be described in further points: