Introduction
Marketing is an important function in an organization. It involves communicating to consumers with the aim of convincing them to buy a given product or service provided by the organization.
The major objective of marketing is to attract customers in the organization. It is important to note that marketing can be regarded to as a science since the marketer is required to carry out market analysis. In marketing, one has to choose market targets in order to carry out marketing segmentation.
In doing so, the marketer will have to carry out a number of analyse. Thus, marketing is regarded as a science. The reason why marketing is critical to a business organization is because it determines its performance or its profitability (Winer and Ravi 14).
The concept of marketing management has become more significant with the emergence of globalization. Multinational organizations are required to manage marketing beyond their home country boundaries, thereby making the process more complex and increasing its significance (Pride and Ferrell 24).
The marketing manager is required to analyze data in the various countries where the organization plans to establish operations in order to develop a marketing strategy that is going to give the organization competitive advantage in that country.
Marketing attractiveness is one of the issues that the marketing manager needs to address. He needs to focus on the right model to research on the marketing attractiveness. This report is related to a research on marketing attractiveness by a Ukrainian company known as the Kids Market Consulting.
Marketing attractiveness and marketing research in Ukraine
Before an organization establishes itself in a market, it should first carry out a research about the market to establish if it is going to be profitable or not. Market attractiveness refers to the possibilities that the market structure in a given industry is going to be profitable (Saxena, 2009). A firm will always be attracted to invest in a market or in an industry that is profitable.
There are a number of factors that should be considered when determining the attractiveness of the market. To begin with, what the firm should consider is the growth rate of the market, as well as the market size. A market that has a high growth rate is worth investing in because chances of viability are high compared to chances in a market that has a low growth rate.
In a market that is growing, there are chances that more customers will be coming to the market. As a consequence, the total sales and profitability are likely to be high. However, chances are that more competitors are likely to join a market that is growing, and the competition will be higher.
High competition has the potential of reducing the profitability of that organization. In addition, there is the possibility of government interventions, thereby affecting the activities in the market.
On the other hand, a large market has more customers and the possibility of more sales and more profits is high as opposed to a small market where there are less people (Dibb & Simkin, 1995). It is worth noting that the level of competition is low in a small market as opposed to a large market.
Another factor that has to be considered is economic factors that prevail in the market. These are factors such as the inflation rate in the market. A high inflation rate will have a negative effect on the development of the market and might reduce chances of viability. Industry saturation is another economic factor that has to be considered.
A company seeking to establish itself in a new market should invest in the industry that is less saturated. If the industry is less saturated, first it will be difficult to penetrate. There will be other companies that are already established and overhauling them will not be any easy for any organisation.
It will take a lot of resources and yet there will be no guarantee of making it through easily. The investment potential of the market is another major economic factor that should not be over looked. A company should invest in a market that has a high investment potential.
The third factor that should be considered is the technological factors in the market. The business environment is changing rapidly (Dibb & Simkin, 1995). Technology is on the rise and organizations are using technology in order to enhance their innovation. Innovation is the life blood of any business organization.
Innovation gives an organization competitive advantage in that the organization is able to produce goods and services that are of high quality.
The organization is also able to produce goods and services that are able to satisfy the consumer needs and increase their satisfaction. Under the technological factors, the company will also assess the availability of raw materials for the purposes of its production if it is in the manufacturing industry.
Finally, the environmental factors should also be considered. These include the degree at which the organization’s products and services are accepted in the market and the regulations imposed by different bodies in the market, as well as the climate regulations (Dibb & Simkin, 1995). Climate regulation is a crucial factor, more because there are products that are usually in high demand during some weather conditions.
In addition, there are products that are not accepted in a given position, while others are acceptable. Therefore, the organization should invest in a society where the products and services are socially acceptable.
There are models that an organization should follow when carrying out research on the attractiveness of a market. When researching in the attractiveness of the market, Kids Marketing Consulting should first identify the relevant factors that are likely to affect its business. There are both internal factors and external factors that are likely to affect the success of a business.
These are the factors that may present as risks or opportunities for the business organization. Any business organization would be interested in investing in a country where there are more opportunities and fewer or no risks. However, it is normal to have risks in a perfect market. In fact, the risks associated with a certain investment may be determinants of the amount of income that can be realized from the investment.
The higher the risk involved, the higher the profits and vice versa (Saxena, 2009). However, no investor would want to risk his or her capital. The aim of investors is to invest in a risk-free area and get maximum income. The investor has to balance between the two aspects since this is not possible in a perfect market. This is one of the major aims of market research; to find a market that has fewer risks and more opportunities.
The internal factors that should be considered by Kids Market Consulting include the following, in addition to the factors that have been discussed earlier in this article: Kids Market Consulting should consider accessibility to financial resources. Capital is one of the basic requirements that are required to start any form of business. Capital is usually in the form of financial resources.
Therefore, Kids Market Consulting has to ensure that it has enough resources before it starts its business in Ukraine. The company will require financial resources to run its operations. Lack of sufficient finances will mean that the organization will not be able to run its day-to-day operations. As a consequence, the company will not be able to access the market attractiveness in Ukraine.
The second factor that has to be considered is consumer loyalty to the organization and to its products. This issue has been addressed earlier in this article, but from a different angle. The organization has to invest in a market where its products and services are accepted by the society.
The acceptability of the products is proportional to consumer loyalty. When consumers are loyal to the organization and its products, then its products will be accepted in the market (Saxena, 2009).
Kids Market Consulting should also consider its brand awareness among the people of the society in which it operates. Kids Market Consulting should ensure that its brand is known in the Ukraine market in order to increase its chances of succeeding. People will only buy the products and services of a company whose brand they are aware of.
Kids Market Consulting should increase its brand awareness through various marketing procedures, such as advertisements and promotions. It is important to note that increasing market awareness will also have a positive effect on boosting consumer loyalty.
External factors that the company should consider include competition in the Ukraine market, the rate of market growth, the size of the market, as well as current usage and price sensitivity. The first three have been discussed earlier. Price sensitivity is a major issue that the company needs to address (Saxena, 2009). There are customers who are price sensitive.
Such customers cannot buy from an organization whose prices are higher than other organizations. It is important to note that customers are always looking for quality products and services. Customers are also always willing to pay the lowest possible price.
The higher the demand of a product in the market the more the attractiveness and chances of viability. Each of the above discussed factors should be considered and taken into account when Kids Market Consulting is carrying out research on market attractiveness.
Reasons for Success of Kids Market Consulting
Kids Market Consulting is a company that offers marketing services in Ukraine. The company creates brands for kids. It also offers strategic planning services, as well as assisting in the establishment of marketing and promotion campaigns. The company has been successful in Ukraine. Kids Market Consulting has also been able to access other markets in different countries, such as Russia among others.
Founded in the year 2002, the company’s success has been as a result of a number of success factors that helped promote its ability to develop and penetrate new markets. Despite the fact that the company has been able to succeed in the Ukrainian market, it has also faced a number of challenges in the course. Among the success factors include its partnership with the other marketing agencies within its market niche.
For instance, the company partnered with other agencies in Russia. This contributed to its success in the Russian market. It is not easy for an organization to succeed in a new market. However, through forming a partnership with the existing companies within that market it makes it easy to be established since customers are already aware of the services offered by the company that is forming the other side of the partnership.
This makes it easy for the incoming company to establish itself since it can market itself in the name of the existing company. This is a strategy that has worked for Kids Market Consulting in its various markets, and particularly in Russia.
Another factor that has led to the company’s success is its market niche. The company targets kids, as well as teens. This group of people makes a large portion of the population in most countries. In addition, they are the people who are known to buy more compared to the older people.
Teenagers are highly active in the market. A company that targets this age group has a higher chance of succeeding compared to a company that targets older people. It is important to note that Kids Market Consulting promotes and offers marketing services, but they do not deal directly in the products themselves.
Marketing their products and services becomes easier and more profitable since kids and teens are likely to buy more and at a higher rate. This ends up contributing to the success of Kids Market Consulting.
Another success factor is that the services of the organization are widely accepted within its market niche. Most people in the society are loyal to the services that the company offers. The products that it markets are also accepted in the society. Consumer loyalty is, therefore, high, making the brand image strong and at the same time increasing the success chances of Kids Market Consulting.
The company has also faced a number of risks. It is also likely to face a number of potential risks in the future (Saxena, 2009). For instance, the level of competition is likely to increase in the future. Competition has the ability to reduce the level of profitability of an organization.
When more companies that offer the same services enter the market, there is a probability that some customers will move to the competitors, resulting in loss of sales for Kids Market Consulting and loss of profitability. It is important to note that competition can even lead to closedown of an organization in instances where the organization cannot cope with the competition.
Slowing revenue could also be at risk. Lack of enough revenue to run the company will lead to the company’s failure in the future. Therefore, there should be solutions to ensure constant flow of revenue.
Future potentials of the Kids Market Consulting
There is always potential for any business organization to improve in the future. The Kids Market Consulting faces the prospect of a number of opportunities that it can utilize to improve its future performance. The company has the ability to expand its current market to most other countries to increase its consumer base and its profitability.
In addition, the company can expand its market by providing other services on top of its current services. The strategic direction that the company should take is to utilize technology to enhance its innovation. Secondly, Kids Market Consulting can take the first move in the countries where there are no similar services. Finally, the company should find ways of improving its revenue to ensure constant flow of finances.
Conclusion
Market attractiveness is one of the issues that an organization needs to assess before joining a new market or in its marketing activities if it is an existing company. The factors that determine marketing attractiveness may differ depending on the market, industry or the country in which the organization is operating. Once the company has assessed the market attractiveness, it can find ways of improving its chances of success.
The company can be able to come up with a strategy or strategies that can help in improving its marketing activities. It is important to note that marketing is a vital business activity since it has a direct effect on profitability. Kids Market Consulting has been a successful company in Ukraine due to its established marketing and promotion campaigns.
Nevertheless, the challenges that face the company, such as challenges of partnering with other agencies in Russia, derail the company in its bid to penetrate new markets. Kids Market Consulting has the potential to succeed in the future by going international to countries that have enough potential.
Given the immense potential in technology as a driver for innovation, Kids Market Consulting should maximize on this opportunity and position itself strategically.
References
Dibb, S., & Simkin, L. (1995). The market segmentation workbook: Target marketing for marketing managers. London: Routledge.
Pride, W. M., & Odies, C. F. (2012). Marketing. Mason, OH: South-Western Cengage Learning.
Saxena, R. (2009). Marketing management. New Delhi: Tata McGraw-Hill.
Winer, R. S., & Ravi, D. (2011). Marketing management. Boston, MA: Prentice Hall.