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ABox4You Company’s Branding, Pricing, Distribution Strategy Essay

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Updated: Feb 27th, 2021

Introduction

The third step in our marketing plan for aBox4You will be the analysis of competition and use of media tools to further our advantage and to stay on top of the competitive chain. Competitive awareness is paramount to any successful business, as it increases awareness of alternative products present on the market and helps predict future competitive challenges, allowing the company to prepare for them beforehand.

Major Inter- and Intra-Competitors

In marketing, inter-competition suggests rivalry between similar products that are differentiated one from another in some way (Riley, Singh, & Blankson, 2016). Intra-competitiveness, on the other hand, means competition between retailers that distribute a similar product (Riley et al., 2016). Both methods of competition are compatible with our brand, as our company is not the only subscription box service in the world, and at the same time, we distribute products that other companies make, using a subscription distribution model.

Our inter-competitors would be subscription box services hailing from the USA, such as Lootcrate, Love with Food, Meatbox, and several other brands. They are very popular in the neighboring country and are looking to expand into other regions, offering shipments to Canada through various transporting companies like Fed-Ex. They offer similar products at similar prices, and unlike aBox4You, which is just starting, they have a name to themselves and a functioning business model.

Our intra-competitors, on the other hand, will be companies that distribute the same products we do, only through conventional retail stores. In a way, our suppliers would also be our competitors, as it is likely that some customers would want to buy their products directly, bypassing us. Since our boxes offer food, sweets, spices, and culinary trinkets, any stores dedicated to the distribution of similar merchandise will be competing with us.

Strengths and Weaknesses of Competitive Brands

In this section, we will analyze the strengths and weaknesses of our inter-and intra-competitors, to determine what aBox4You should capitalize on to have a competitive advantage against these brands. For a starting company, it is very important to identify these weaknesses and use them to gain a market share.

Lootcrate, Love with Food, Meatbox, and other American brands all have one serious and distinct disadvantage over aBox4You – they are all American brands with little to no foothold in Canada, yet (Bischof, Bottger, & Rudolf, 2016). Our company will be based in Toronto and distribute products offered by local producers, meaning that we cater to the Canadian population. They are more likely to buy products that are fresh and produced locally rather than products made in a foreign country and spent days in transport before reaching their customers. Long-distance transportation can damage certain goods such as food, and increase their price.

The strengths of these competitive brands are evident – they are well-known in the USA and have strong customer and resource bases there. However, these strengths are irrelevant in Toronto, as they have yet to open a distribution base here. Our competitors cannot rely on their renown and resources as much as they could in the USA when penetrating the Canadian market.

Local producers and retail stores have a distinct set of advantages over us. Depending on the size of their business, they would be able to provide a vastly more elaborate array of products than we ever could and present it to potential customers that visit their stores. Due to operating in Toronto for a long time, they are likely to have some renown among the locals.

The traditional retail store model comes with a set of distinct disadvantages, however. Most of them do not offer home delivery, meaning that they are largely restricted to whatever district they are settled in. Additionally, while these companies can offer a variety of products, their stores will be restricted to singular brands only, while aBox4You offers a multitude of products that change every week.

Differentiation Strategy

Coming up with a unique and one-of-a-kind product is extremely difficult in the age of modern marketing. Any new product is bound to be copied to some degree within a relatively short timeframe. While aBox4You uses the Blue Ocean marketing strategy due to no direct competition present in Toronto, similar services exist in the USA and are bound to appear in Canada.

To differentiate ourselves from products such as Lootcrate, Love with Food, and Meatbox, aBox4You will focus solely on promoting local producers and suppliers, should their goods meet our quality standards. This will increase our popularity not only among the companies that we are dealing with but among the customers as well, who would support local brands than invest in foreign businesses (Rothaermel, 2015).

Besides, this strategy will allow us to cut costs on our merchandise, and save money on transporting it from other places. This means that aBox4You will be cheaper when compared to our foreign competitors. To penetrate the Toronto market and compete with us for market share, these companies will have to either commit to penetration strategy and drop down prices, meaning a loss of profit, or fully commit to constructing a local distribution base, which will take time and money.

Leader or Follower?

There are two distinct marketing positions in business, the Leader, and the Follower position. The leader position assumes that the company is going to aim for innovation and breakthrough, to claim its market share (Rothaermel, 2015).

This approach has its own set of risks and advantages. The advantage of being a leader is that your company is always first, which promises great profits and a healthy market share. On the other hand, being a leader includes the possibility of failure. The follower position is much safer in that regard – a follower company practices that which has proven to be profitable and effective. At the same time, being a follower means competing with companies that got there first. Claiming market share would be more difficult for a follower company (Rothaermel, 2015).

Given the circumstances, aBox4You can use both strategies to its advantage. In a way, it will be a follower company, since it will use the Subscription Box model, which has proven itself as a legitimate business concept in the USA. At the same time, it will be the first subscription box service in Toronto and adjacent localities. Thus, the product will be able to claim significant market share by being the first, while staying relatively safe, since the concept has already been tried and proven successful.

Social Media Tools

Social media is a rapidly growing outlet for the marketing industry that has the potential to outgrow and eclipse other media outlets, such as television, radio, and even live to advertise. Marketing specialists acknowledge the importance of social media in finding customers, promoting brands, and delivering accurate thematic advertisements based on the location, tastes, and particular interests of the end-user (the Chu, 2011).

To promote aBox4You through social media channels, the company must establish a social group on all popular media outlets such as Facebook, Tweeter, and other similar social media services (Chu, 2011). This group will allow getting all active members of the newly-found community together, and inform all potential customers about promotions, discounts, sales, contests, and other activities aBox4You will be made to please its clients and promote its products.

Social Media is also an excellent information-gathering tool. Facebook, Twitter, and even popular search sights like Google, all gather information about their clients, which they later use to make personalized advertisements (the Chu, 2011). These ads could promote products similar to those a customer likes, thus increasing the likelihood of them responding to the advertisement, or tie the advertisement to the user’s current location. Facebook and Twitter offer such services, and aBox4You will be using these media outlets to promote their products in such away.

The third way to promote a product is through search engines. If your company is on the first page in Google Search, it is more likely to be noticed by potential customers and investors (the Chu, 2011). Some companies can manipulate Google Search to promote a company’s site to appear in search, for a price. aBox4You will use this outlet to its advantage.

Integrated Marketing Communications

The integrated marketing communications concept suggests cooperation and connection between all branches of the company, including the end-users of the product. Although it can be quite lucrative to implement such a system within a company, IMC can help boost sales, create competitive advantage, save money, and improve inter-branch relationships (Belch, Belch, Kerr, & Powell, 2014).

Integrated marketing communications would be necessary for aBox4You and its advertising strategy. The most important parts of IMC for this business model are horizontal integration, data integration, and internal marketing (Belch et al., 2014).

Horizontal integration suggests a communal approach of all branches of the company towards a specific goal. For example, during the advertising campaign, production, distribution, communication, and finance branches are expected to work together and realize that their actions send messages to the clients. By acting in the best interest of the client and striving for excellence the company will improve its image. This is important for aBox4You, since the company is only starting, and quality service is the only way to earn loyal clientele.

Data integration is vital for brand promotion. For aBox4You to become recognizable to potential customers, the company’s colors and labels must be integrated into products, uniforms, notifications, wrapping materials, and related merchandise (Behzad, 2014).

Internal marketing is vital for promoting a healthy customer community and making it grow. All personnel, from regular employees to top managers, are expected to know about the company’s promotions and actively participate in the life of the company both inside and outside the office. This factor is key for successful company promotion through social media, as well as necessary for finding and securing new business contracts and attracting potential investors.

References

Behzad, M. (2014). The art of packaging: An investigation into the role of color in packaging, marketing, and branding. International Journal of Organizational Leadership, 3(2), 92-102.

Belch, G.E., Belch, M.A., Kerr, G.F., & Powell, I. (2014). Advertising: an integrated marketing communication perspective. North Ryde, Australia: McGraw – Hill Education.

Bischof, S.F., Bottger, T., & Rudolf, T. (2016). What’s in the box? Risk in surprise subscription models. Association for Consumer Research, 5(3), 1-15.

Chu, S.C. (2011). Viral advertising in social media. Journal of Interactive Advertising, 12(1), 30-43.

Riley, F.D., Singh, J., & Blankson, C. (2016). The Routledge companion to contemporary brand management. New York, NY: Routledge.

Rothaermel, F.T. (2015). Strategic Management. New York, NY: Mcgraw – Hill Education.

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