SMIP Specimen June 08

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Professional PostgraduateDiploma in Marketing64 Strategic Marketing in Practice

SPECIMEN ANSWERS FOR JUNE 2008 EXAMINATION PAPER

Note: In an attempt to present an accurate and representative account of a candidatespiece of work, the answers have been reproduced in their original form and may thereforecontain grammatical, terminological and formatting errors and inconsistencies.


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Introduction

The specimen answers provide examples of answers that can be reasonably writtenwithin the allocated time. The answers demonstrate what is required to achieve a goodpass mark, unless otherwise indicated in the Comments.

Remember when revising from these examples that there are no right or wrong answers.The examiners are looking for you to apply your own marketing knowledge and skills tothe question set. These answers should be indicative of the content and format that theexaminers expect to see.

To give you the best chance of passing your exams, these specimen answers can beused in conjunction with the examiners reports, in which the senior examiner for eachsubject outlines best practice. The examiners reports are available from CIM Direct andon the CIM student website, www.cim/learningzone.co.uk.

We hope you find these specimen answers useful and informative. Although we cannotenter into correspondence, we would welcome comments or feedback, which should besent to [email protected] or to CIM Publishing at the Moor Hall address.


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CIM SPECIMEN ANSWERSPROFESSIONAL POSTGRADUATE DIPLOMA IN MARKETING

STRATEGIC MARKETING IN PRACTICE JUNE 2008

This particular case study looks at the construction sector and attempts tounderstand how marketing works within a highly competitive and basic industrysector. Tool hire is a difficult business and companies have to find distinct waysto develop a strong presence in the market. This case study explores the way in

which Speedy creates a differentiated service proposition. The specimenanswers below are indicative of well developed arguments and should not beconstrued as being perfect answers. Both answers will give differing viewpoints.

ANSWER SCHEME

Answer all questions

In your role as an independent researcher and marketing consultant in the plant and toolhire industry, you have been asked to write a report based on the following tasks.

Question One

Critically assess the UK and international opportunities available to the tool andequipment hire sector, highlighting potential areas where Speedy Hire couldexpand their service offering.

(25 marks)

This question requires candidates to thoroughly analyse the data given and to spot

opportunities for expansion within the tool and equipment industry. This answer shouldbuild on the current strengths that the company has developed over the last 10 years inthe UK market. It has become a market leader and created a special strategyencompassing safety and quality testing of equipment.

Candidates should distinguish between the plant hire sector, which is mainly determinedby civil engineering projects, and the tool hire sector which is within housing constructionand DIY. Candidates will rely heavily on the analyses of the various sectors and the data

given. With regard to the international sectors, they could look at GDP and potentialgrowth within the sector in the countries. Many of the potential opportunities are already


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OPPORTUNITIES With more companies seeking to outsource equipment, plant hire companies can gain

stability by introducing long term contracts Large plant and tool hire companies with national coverage can afford national

advertising campaigns Improvements in IT systems and communications between plant hire operators and a

centralised plant hire location would assist greatly improved customer serviceAs large consumers of plant equipment, plant hire companies are in a better position

generally to negotiate good prices for buying plant PSF and government-funded initiatives provide opportunities for big construction

projects such as building hospitals or government buildings Public sector construction and infrastructure projects provide opportunities for

expansion Tool hire companies can seek to introduce stability by entering long-term contracts

with larger companies There is a move towards preferred single supplier agreements Continued improvements in inventory control can gain a tool hire company a

competitive advantage, through centralised hire centres and offering the customerflexibility about where tools can be hired or returned

Periodic regional growth opportunities, reflecting the impact of climatic factors (e.g.flooding)

Whilst the market is becoming more concentrated with acquisitions and mergers etc,opportunities still prevail with the expansion of builders merchants

These opportunities can be tied to the various growth sectors and the potential impact ofthe Olympics. Also, it may make sense for the company to cross over into the Europeansector with their expertise. The Asia Pacific sector would be a longer term growthprospect. It could be that the company may well want to repeat its success in othercountries such as Germany, where safety factors are as stringent as in the UK.

Analysis ofmarket opportunity 10 marksOpportunities for expansion 15 marks

Total 25 marks


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Question Two

Critically analyse the role that integrated marketing communications has played inSpeedys marketing success, and recommend how this could be extended tointernational markets in the future.

(25 marks)

This question is quite straightforward if the candidates can actually weave the IMCtheory into their answers. The Kitchen and Schultz model makes a lot of sense andintelligent students could use this model to develop their answers.

The American Association of Advertising Agencies: IMC is a concept of marketing communications planning that recognises the

added value of a comprehensive plan, that evaluates the strategic roles of avariety of communication disciplines for example, general advertising, directresponse, sales promotion, and PR and combines these disciplines to provideclarity, consistency, and maximum communications impact.

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Speedy were very good at implementing the IMC concept in eight steps as discussed bySchultz and Kitchen.

1) They undertook market research to establish the customer prospects andunderstand the value of their new campaign

2) They located the key contact points with suppliers, customers and otherstakeholders such as HSE

3) They started to build brand relationships through the Speedy logo and the linkswith health and safety

4) The message was carefully conceived and delivered through multiple channelsas discussed above

5) They estimated the return on customer investment (ROCI) and duly spent 2mon buying new equipment

6) They invested heavily in the campaign7) They instigated marketing metrics and measured the success of their campaign

in terms of market growth and return on investment8) This exercise will have developed their database of customers and will give them

a chance to launch other Integrated Marketing Campaigns.

Candidates should then be able to discuss the merits of utilising such a strategy ininternational markets. They should be aware of cultural differences and of understandingthe fact that international markets may be at different stages of development from theUK market.

Analysing IMC in context 15 marksInternational issues 10 marks

Total 25 marks

Question Three

Critically evaluate how Speedy Hires strategic approach to business developmentand marketing has contributed to its significant financial success.

(25 marks)

Candidates should be able to look at the branding and marketing strategies deployed bySpeedy and place them in context with regard to developing a successful strategy.

The marketing campaign established Speedy as not just a supplier but also a partner


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marketing to customers one at a time articulating the desired relationship with consumers by providing a guide to the

appropriate behaviour for the brand in its various transactions with theconsumer. Speedy have done this through their emphasis on health and safetyand by helping the customers to implement certain standards

brand attitudes and behaviours expressed through packaging, sales promotionand PR, which should all be consistent with their relationships. Speedy havecommunicated this through their special logo that is used on all building sitesutilising their tools

the importance of corporate brands their communications shift the brandsattitudes and behaviours back to the people. Speedy have succeeded in doing

this really well, in that they have set up an industry standard that complies withtheir brands attitudinal stance.

The employees of a corporate brand both represent a means of communicating thebrands attitudes and are an integral part of the brand. The employees undergo trainingand buy into the brand attitude. This can then be translated into an understanding of thefinancial success. This is reflected in their year-on-year profitability, as shown in thefinancial performance tables and the graphs in the appendices. Good candidates will

take this forward and look at the triple bottom line approach as shown below.

Marking Scheme

Critical evaluation of the Speedy approach 15 marksLinks with financial success 10 marks

Total 25 marks

In addition, 25 marks will be allocated for the prepared analysis of the case and itsapplication to the questions above.

(25 marks)

(Total 100 marks)

Summary

As usual, examiners will look for innovation and creativity in the way candidatesapproach and answer the questions. The key points that should be considered arecoherence of approach, strategic thinking and attention to detail. As this case contains alot of data, useful analysis of the data will also enhance the answers. As usual, we will


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Specimen Answer One

Strategic Marketing in Practice

6 June 2008

Executive Summary

This report will aim to identify and critically assess the opportunities driving the tool and

equipment hire sector and identify potential areas where Speedy Hire might develop their

service offering in order to maintain and strengthen their position as the number one hire

company.

The following two parts of the report will make recommendations for extending Speedys

marketing communications internationally and evaluate how the strategic approach to

date has contributed to success.

PART 1: Potential UK and international opportunities

There are a number of factors driving the UK tool hire, each presenting a range of

opportunities for Speedy Hire to pursue. Figures 1.1 and 1.2 highlight some of these

trends, changes and key drivers, and are translated into ways Speedy might leverage their

strengths and competencies to exploit these opportunities in Figure 2.1.

This report will highlight the most appropriate and significant changes and address ways

to exploit them.

1 Health and Safety

h i i di h l h d f i h i d d h i h i f


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established itself as a leader in health and safety, Speedy have the opportunity now to

build on this competitive advantage and first-mover advantage.

Further initiatives, such as establishing a health and safety training centre/academy,

becoming official health and safety accreditors (their existing strong links with the HSE

provide an in-road into gaining the support to do this), or even becoming health and

safety specialists in the industry. This would involve reviewing sites, needs and

specifying particular products for projects.

Speedy Hire currently has resources in place to strengthen their focus on health and

safety Figure 6.7 highlights its superior contacts with external health and safety bodies

and expertise, and so such initiatives would not require huge investments, rather a

directed focus on these opportunities.

2 Key Account Management

The industry is increasingly seeing a shift from transactional marketing to relationship

marketing. Key Account Management and a more focused approach to selecting

valuable accounts and adding value would help Speedy to understand customers needs,

identify unmet needs that might arise, enhance their service offering through customised

health and safety training, and ultimately improve the profitability of these accounts.

3 Building Speedy Brand

The current issue regarding health and safety is that competitors, such as Hire Station and

A-Plant Tool Hire, have also started to recognise the benefits of investing in this sector.

In order to protect their share in this sector (see Figure 3.5), Speedy need to differentiate

themselves and strengthen their brand to remain the number one choice for health and

safety in the mind of the consumer


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4 Product Development

The previous recommendations have been based on a strategy of market penetration, as

illustrated in Figure 4.1.

However, there are opportunities to develop Speedy Hires product range in light of the

current trends. Figure 4.2 highlights potential areas which Speedy might choose to go

into.

Of these, it is recommended that a move into the emergency safety equipment market

(i.e., emergency safety showers and eyebaths, mobile decontamination units) would

complement Speedys focus on safety, work together with other products in its offering

and fit strategically with its decision to move into such markets as petrochemicals and

utilities, where concerns regarding hazardous substances are high.

4.1 Environmentally friendly products

The tightening of emissions\energy legislation and increasing concerns among businesses

create an opportunity for safety to integrate these values into their offering and their

positioning. The fact that they have already begun to do this puts them in good stead to

develop this area even further.

5 Plant Hire

The plant hire section of the industry is showing real prospects (Figure 4.1) and the shift

seems to be toward the more heavy end of the market. As Speedy is currently highly

geared, my recommendation would be to investigate a move into plant hire on a low-risk,

low commitment basis, e.g., joint venture or strategic alliance.


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6 ICT Development

Developments in ICT are providing opportunities for hire companies to reduce their costs

by restructuring. I would recommend that Speedy Hire start to restructure their current,

rather fragmented businesses into a hub and spoke network, which would enhance

flexibility and customer service and encourage cross-selling.

7 Market Development International Opportunities

While there are still opportunities within the UK to move into non-construction markets

such as the oil and gas sector or emergency services/disaster recovery sector, I

recommend that Speedy look in the next few years at creating an international presence.

7.1 Selecting foreign markets

In selecting foreign markets we need to assess the opportunities available to us. Whilst

the Asia-Pacific requirement for tool and plant hire is likely to grow by 29.6 percent by

2011, and the forecast for construction output looks positive, there are numerous negative

implications.

Considering Speedy Hires lack of experience in international marketing, the distance,

culture gap, language, complex trading barriers, tariffs and entry requirements make it a

less attractive market. It is also less likely to prioritise health and safety as in the UK.

Figure 4.4 highlights some of these issues the company needs to consider, using the 12Csmodel. Europe, on the other hand, and in particular Western Europe (with particular

attention to France, Spain and Italy see Figure 4.5) presents a relatively high growth

market, and an attractive market, in terms of its proximity, culture, customs, similar

outlook on health and safety contractual obligations, and of course, construction

output/likely demand.


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7.2 Entering foreign markets

In light of the increase in Speedys borrowing over recent years, and impact it has had on

interest rates and gearing (see Figure 2.2 for analysis), I would recommend that Speedy

look to enter these Western European markets (primarily France and/or Spain) through an

indirect international strategy, i.e., joint venture, franchising or licensing.

These methods of market entry provide a quick way into the market; often the benefit of

local market knowledge, and less capital investment than direct methods.

However, they need to be aware of the presence of existing suppliers, and take this into

account when developing communications strategies. They will also need to be aware of

the competitions reaction to Speedys entry.

Conclusion

There are numerous opportunities facing the industry. By pursuing the recommendations

outlined in this section, Speedy can remain at the forefront of the industry and stay true to

their growth strategy and core values.

Comments

This answer is well constructed and looks at why Speedy has succeeded in the

marketplace. All the key areas such as branding and relationship marketing have been

covered well. The second part looks at the potential opportunities available to Speedy.All the discussions are supported well by the analyses.


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PART 2

Part of Speedys success, both financially and in terms of customer commitment and

retention, is down to their recent integrated marketing communication campaign.

This part of the report will analyse what has made the campaign successful and how these

findings can be used in developing an international marketing strategy.

1 Integrated Marketing Campaign Success

1.1 Marketing research

Before developing the campaign, Speedy Hire undertook extensive research into the

needs of their target customer groups. This helped them to identify exactly what it was

that customers needed and wanted, and the needs that were not being met.

Such insight then enabled them to develop the campaign specifically targeting end-

users/site level and with the view to communicating new health and safety regulations.

As a result, the campaign was targeted, relevant and effective.

1.2 Customer-led

The relevance of the campaign and the highly targeted nature of communications,

displayed to Speedy Hires customers its dedication to them, its willingness to developsolutions with and for them, and an interest in customers businesses and business

environments.

As illustrated in Figure 3.3, Treacy and Wiersena argue that to truly be a market leader,

companies need to excel in one of three value disciplines. Such a customer-driven

marketing campaign demonstrated Speedys ability to excel in customer intimacy


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and brand image is flexible and translates well in foreign languages, giving the company

mileage to create a global brand.

3.1 Strong branding

In order to remain consistent, and to avoid damaging the brand, values and vision need to

be extended to new markets. Therefore, Speedy will need to focus on how best to

translate its values and vision (see Figure 5.6, Brand Onion) into new markets, and

where to position the brand in light of local competitors positioning and strategies.

It is also imperative that operations in foreign markets, along with culture, employee

attitudes, service quality and commitment are managed and maintained to the high

standards to the high standards required in order to support the image of the brand and the

values it communicates. This is illustrated in the Brand Iceberg (Figure 5.4).

3.2 Marketing communications plan

Speedy will need to invest in some research into the given foreign market in order to

understand what the priorities and unmet needs of consumers in that market are, and

adapt their current communications accordingly. In addition, an analysis of theenvironment will be necessary to identity the most effective and appropriate

communications channels and also understand such things as the health and safety

legislations in that market.

It may be that health and safety is not as much of a concern as in the UK, in which case

Speedys communications may first look to creating awareness of the issues and therefore

creating the demand for their differentiated services.

I recommend that regardless of the current situation regarding health and safety in the

country, the company needs to not just address customers, but also influence markets

(e g equivalent to HSE) and governmental bodies The need to address these various


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3.3 Promotional options

It is likely that a face-to-face method of selling will be most appropriate in the early

stages of the international marketing strategy, e.g., road shows, site visits, tool box talks,

as this opens up two-way dialogue, helps to understand customers needs and starts to

build a relationship with potential customers (Figure 5.1) with the view to encouraging

their climb up the ladder of loyalty (Figure 5.2).

An offensive, above-the-line campaign may also be required to support this in order to

build awareness of their presence in the market, attract interest, and warn competitors.

Conclusion

Whilst adaptations to the current communications model will clearly be required, it is

imperative Speedys communications and branding strategy align with their current

values, in order to strengthen their brand both in the UK and globally.

Comments

This answer looks at the key Integrated Marketing issues that are of importance to the

organization. The analysis is good and relies heavily on appendix. However the answer

would have benefited from a good venture into a theoretical model such as the one

shown in the marking scheme. This would have tied down the holisitic nature of IMC

that is required for success. Success in the International market is difficult and what

works in the UK does not always work well elsewhere. The candidate should have

explored the problems cultural values and communication.


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PART 3

Speedy Hire appears to be a company who are doing everything right. But their success

has not happened by accident. Speedys strategic approach to business and marketing

development has led them to ultimately become the number one company in its industry.

The following part of the report will critically evaluate how their approach has achieved

this.

1 Market Sensing

By implementing tools for environmental scanning and recognising its importance,

Speedy have been able to understand the environment it is operating in and predict/plan

for changes and opportunities as and before they emerge. This has ensured they remain

at the forefront of legislation and customer trends in demand/concern.

2 Clear Objectives

Clear, defined corporate and marketing objectives allow Speedy to continually measurewhether they are on track financially and in terms of marketing objectives. Having clear,

SMART objectives enables the company to compare performance to what was set out at

the beginning of a year/plan/strategy.

3 Strategy

The company has pursued a strategy of penetration, market and product development,

and diversification (as in Figure 4.1) over the years which has helped them to increase

sales from existing customers (through KAM, cross-selling and an augmented service

offering, move into new markets (such as lifting, and power equipment), widen their

range of both hire and complementary non-hire services and gain further expertise


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Such a strategy, combined with identification of opportunities to reduce costs (e.g., an

organisation-wide, integrated IT system, has led them over the years to close their

strategic gap. This concept is illustrated in Figure 3.4.

However, having grown both organically and through acquisitions to date, the company

has accumulated increased borrowing and is consequently highly geared, with a gearing

ratio of 109 percent (Figure 2.2). This could become a concern to shareholders and will

undoubtedly impact share price, and so it is probably going to be necessary for Speedy to

take an approach allowing a period of consolidation and organic growth to reduce

gearing.

In addition to this, a decreasing Gross Profit Margin (Figure 2.2) suggests that the

companys approach may have been to discount products. In order to increase Gross

Profit Margin the company may have to shift its focus to premium pricing, by

concentrating on building its brand and strengthening its differentiated position. Whilst

discounting increases turnover, it is profit that shareholders are interested in. As the

saying goes, turnover is vanity, profit is sanity.

4 Management of Strategic Business Units (SBUs)

Speedy has effectively managed its SBUs, as illustrated in Figure 3.5, identifying where

investment for growth is required (i.e., Health and Safety, Training, Lifting, Power) and

managing tool hire for cash to invest.

5 Differentiation Strategy

In a competitive, saturated market, where it is becoming increasingly hard to create

customer loyalty based on product/service offering alone, Speedy has recognised the need

to pursue a differentiation strategy as highlighted in Figure 3 2 and has identified the


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6 Strategic Approach to Marketing

A strategic approach to marketing has allowed Speedy to effectively manage

relationships with all key market stakeholders, and not just customers (Figure 6.6). This

has led to third party endorsement that has been critical to their success, and also the

development of environmentally friendly products, addressing the wider needs of the

community (influence markets). Its recognition of the important role marketing has to

play has also led them to foster a culture of innovation and learning and employee

empowerment.

7 Control Measures

The implementation of control measures, e.g., cumulative sales for SBUs, sales of new

products responses to advertising and health and safety measures, allows them to pursue a

strategy of goal setting performance measures performance diagnosis corrective

action. This ensures continual control and regular checks that they are meeting

objectives, and if not, to rectify the situation. It has also ensured the effectiveness of their

marketing campaign.

In addition, such a strategic approach to the marketing campaign ensured the significant

investment made was not wasted.

Conclusion

To continue growing successfully, Speedy must continue to take an organised, strategic

approach to both business and marketing development, and this assessment if their

approach to date should offer good insight into the appropriate ways to do this.

Comments


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been good to see a little more emphasis on the financial success and to relate this more

closely to the marketing strategies with some justification. However, overall this a good

answer to the question set.


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Specimen Answer Two

Strategic Marketing in Practice

6 June 2008

Speedy Hire Report

6 June 2008

To: Steve Corcoran, COO, Speedy Hire plc

From: Marketing Consultant

Overview

Section 1: Assessment of UK and International opportunities

Section 2: Assessment of the role of integrated marketing communications

Section 3: Evaluation of Speedy Hires approach to business development and

marketing

Appendix


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OVERVIEW

Speedy Hire is the UKs number one tool and equipment hire company. The company

has grown rapidly through both organic growth and acquisitions. It has rightly earned its

position as a premier player in a difficult market which faces intense competition and

consolidation (see fig 2.2, page 2 Porters Five Forces).

Whilst Speedy Hire serves a mix of B2B (Business-to-Business) and B2C (Business-to-

Consumer) markets, this Report will focus on the B2B market as this is the area that has

the largest market size and growth rate (see fig 2.3, page 2 Target Markets).

This Report commences by making an assumption that:

- Speedy Hires primary B2B customer is the construction industry- Speed is not considering plant hire (although the distinctions between tool,

plant and equipment hire are blurred) due to many players in the plant hire

space.

Speedy Hire operates in a dynamic market place and it must protect its position andmarket share. The aim of this Report is to address questions raised at the last meeting in

sections 1-3.


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SECTION 1

Assessment of the UK and International opportunities

i) UK market development

The UK market for tool and equipment hire is nearing saturation. Financial analysis (fig

5.1, page 5 segmental analysis) shows that since the acquisition of LCH generators and

lifting gear in 2006, equipment asset utilisation rates have fallen. This, coupled with the

fact that Speedy is relying on one major B2B market, construction, demonstrates that

Speedy Hire has an opportunity to broaden its horizons and look at new market

opportunities in the UK.

Strategy recommendation for the UK

Fig 4.1, page 4 Ansoff matrix shows Speedy Hires current products and the markets

which it services.

New market development will help Speedy Hire to:

- protect its position as its fortunes are currently too over-reliant on construction

- expose Speedy Hires extensive range of under-utilised equipment and tool

hire to new, and potentially very profitable markets.

I have revised the Ansoff matrix and extended it to new markets (see diagram below).


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Diagram: UK market development for Speedy Hire plc

EXISTING PRODUCT RANGE PRIMARY

MARKETS

SECONDARY MARKETS

Training

Consumables

Speedy space

Speedy engineering

Speedy generators

Speedy compressors

Speedy pumps

Speedy lifting

Speedy tool

NEW MARKETS

privateindustrialconstruction

Civilengin

eering

Removalfirms

Freightterminals

Businessstoragefacilities

Warehouse

anddistribution

NEW MARKETS

I also recommend that Speedy targets organisations that have national coverage. This

will help it to exploit its national network of depots and allow the cross selling of the

items in Speedys portfolio


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Initial analysis suggests focusing on primary UK markets such as civil engineering and

private industrial construction as the markets are sizeable (see fig 2.3 target segments)

and similarities in conducting business such as construction (Speedys traditional

market).

Secondary markets have great opportunity too. For example, the industries listed could

all benefit from lifting gear to prevent manual handling injuries, such as warehousing and

distribution. Initial analysis suggests that for this sector there are a number of large

organisations with national coverage for us to exploit such as Eddie Shobart, Browns

Group and Palletline.

I suggest Speedy Hire begins marketing intelligence gathering regarding market size

(should all be inputted into the marketing information system). Existing material fromthe Safety from the Ground up campaign can be updated from the new markets at a low

cost and co-branded where appropriate.

ii) International development

The initial research highlighted that there is huge overseas growth in construction. The

research showed that the amount spent on construction overseas as a %age of GDP is

rising faster overseas.

With harmonisation across the EU on health and safety, it is natural to focus on just

Europe. I have analysed the construction output figures in depth (see fig 5.3, page 5

market attractiveness ranked by size of market opportunity and CAGR). The figure

shows the top nine countries that met the above criteria for market attractiveness

(financial).


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1) Whether Speedy Hire could enter market and use health and safety as a

differentiator

2) Geographic proximity

3) Cultural considerations.

This is summarised in fig 6.2, page 6 (Business Portfolio matrix). The figure suggests

that Spain and the UK have the highest ranking (I have removed the UK from the part of

the Report as we have considered a strategy for the UK in the earlier part of this section).

With harmonisation across the EU on health and safety, we have a real opportunity to

target the Spanish market, with health and safety as our core value proposition.

Spain is currently experiencing high levels of growth and we need to capitalize on this so

speed of market entry is key.

My recommended method of entry into Spain is via the acquisition route as it is the

fastest route to market. This method will allow Speedy Hire to purchase instant market

information, market share and channels of distribution. It is also the most profitable as

Speedy will not be sharing the profits. With a strong track record in successful

acquisitions, Speedy Hire is well positioned to consider this course of actions.

Some considerations on acquisition

- at the time of producing this Report, Speedy has a high gearing ratio (as a

result of a 150million debt facility) and a cash collection issue (fig 4.2, page

4 Evaluation of Speedy Hires financial performance). Liquidity is also

falling. These factors combined may make it difficult for Speedy Hire to

secure additional funding (situation made worse by the current credit crunch:


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- I suggested we implement the UK market development strategy first as it will

increase equipment and tool utilisation ratios and thus increase returns on

assets, thereby improving the gearing and liquidity ratios.

Speedy Hire has a strong management team so I fully believe that they will make a

success of overseas expansion.

I also recommend setting up an International marketing information system (using Doole

and Lowes 12Cs Framework to capture valuable data on all the primary, secondary and

tertiary markets captured in fig 6.2 Business Portfolio matrix).

Please note that whilst Spain is an attractive country at this present time, its position may

change in the next few years. Speedy Hires excellent ability of market sensing coupledwith an updated marketing information system will ensure sound strategic decision

making.

Comments

Overall this is a pleasing answer and the candidate has obviously carried out careful

analyses that he knits into the main proposition. However, there could have been better

justification for the strategies that have been put forward. It is no good just

recommending frameworks because the answer has actually asked the candidate to

analyse the case and put forward opportunities. The candidate has done this well in the

extended Ansoff Matrix, but not necessarily elsewhere.


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SECTION 2

Assessment of the role of integrated marketing communications

Speedy Hires success in part has been due to its excellent marketing and the ability

to respond to the needs of its customers and trends/issues in the markets which it

serves. Integrated marketing communications has played a huge role in Speedy

Hires success.

Speedy had first mover advantage (in a largely undifferentiated market) bydifferentiation in its value proposition on health and safety (see diagram below:

Porters generic strategies diamond adapted).

Focus

Cost leadership Differentiation

Speedy Hire

CRS (Corporate social responsibility)


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This became a key part of its strategy (see fig 1.2, page 1 McKinsey 7S framework,

strategy), and marketing was able to deliver on the strategy using the Safety from the

Ground up campaign.

The success of the campaign in raising awareness has been largely down to Speedys

approach of partnering and consulting with all stakeholders. Suppliers, partners,

employees, the Health and Safety Executive were all consulted to ensure an integrated

campaign that would be easy to understand and be delivered in a format that would be

understood by the end user.

Critical to any campaign is the ability to measure the results to determine success or

failure. Speedy Hire had marketing metrics for each aspect of the campaign so that

response levels (via website) and responses to advertising, sales of new products, etc.

By using metrics in this way, Speedy Hire can evaluate what is working from a marketing

standpoint.

Interestingly, brand awareness of Speedy Hire and the health and safety campaign was

not measured. As a result we do not know how much of an impact the success of this

campaign has had on the brand awareness of Speedy Hire.

Since the Safety from the Ground up campaign, many of Speedys competitors are now

using health and safety as a differentiator. In fact, some of the analysis on the perceptual

map (see fig 6.1, page 6 Key players and perceptions of Health and Safety) even

suggest that Hire Station is four times larger than Speedy Hire on the health and safety

message.

I conducted a brand positioning audit (see fig 5.3 Brand identity and brand pyramid). It

was clear from this analysis that Speedy Hire could improve its brand position to make it


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Investment in the brand is critical to achieve brand loyalty (how individuals made

evaluations between alternatives and why they are willing to enter into a relationship with

one supplier).

Branding is important in a highly commoditised market, but more so in large B2B

organisations.

Speedy Hire has a positive image but a lack of differentiation and now its competitors are

catching up.

I recommend a brand redevelopment for Speedy Hire to help it differentiate itself and

therefore increase competitive advantage.

Brand strategy and development

The new Speedy Hire brand should focus on the following core values:

- safetystandards

- assurance- quality- partnership for

success- sustainability

All factors that would

appeal to the target market


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New Speedy Brand Positioning (Kapferers adapted)

Commitment to hard workand can do culture

CULTURE

Trustworthy Customer

Caring focused

Responsive PERSONALITY RELATIONSHIP organisation

Integrity

Intrinsic- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -Extrinsic

PHYSICAL REFLECTION

SELF IMAGE

Your partner for safety Customers will see themselves Pioneers: first to

and sustainability as using an ethical safety-conscious market. We listen

(possible green organisation and we actbackground for sustainability Quickly

core value).

New Speedy tagline: Your partner for safety and sustainability

Branding and International markets


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1 Encourage new international markets to try Speedy Hire

2 By encouraging positive pre-conception it can generate a preference for the

Speedy Hire brand abroad.

3 The tagline explains what the company does; what its value and beliefs are. This

tagline would be adapted and translated for international markets.

Integrated marketing communications and International markets

Now that the branding has been discussed (on its importance in a B2B context to

establish trust, loyalty and relationships) we need to consider now integrated marketing

communications; we can consider the application to international markets:

i) Communication packsThese would have to be translated into local languages. The current imagery

used on the packs could be used universally as they explain the various

dangers that the campaign is trying to address.

ii) Tool box talks

These would have to be tailored to meet local regulations and adapted for any

product. (The tool box talks have been successfully received in the UK by

operators whose first language is not English.)

iii) Training

Speedy Hire would need to create material and train the local staff (using a

translator and translated materials) on new regulations.

iv) Posters

Translated posters would need to be supplied with the new Speedy logo (with

translated tagline)


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Speedy Hire would need to train local employees on the campaigns to raise

awareness internally. This would have to be done face to face.

vi) Marketing metrics

Suitable marketing metrics would need to be established, as per the UK

campaign. As Speedy Hire is a learning organisation, it would be able to

continually refine its campaign, taking into account cultural factors, language

and literacy issues, etc.

Comments

This is a well-developed and comprehensive answer, considering all the main issuespertaining to Integrated Marketing Communications. He/she has also looked at many

of the problems and opportunities of communicating to a wider audience in

international markets. There is also good use of relevant theory as well as the pre-

prepared analyses.


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SECTION 3

Evaluation of Speedy Hires approach to business development and marketing

The research highlighted a key objective in Speedy Hires growth strategy (research:

page 21).

To increase the range of hire services available, to ensure customers obtain more high

quality, consistent services from fewer suppliers, increasing cross selling and improving

client relationships.

The objective above and Speedy Hires significant financial success demonstrates howthe organisations approach to relationship marketing is paying great dividends.

Let us break this objective down into its component parts to highlight how Speedy Hire

has achieved its goals.

i) increase the range of hire services available

Speedy Hire has taken a highly acquisitive approach to growth by making a series of well

planned and executed strategies focusing on those products that would complement its

existing portfolio and add value to the service offered to its customers.

Speedy has made these products and services readily available using its One Speedy

initiative of an integrated call centre, website, etc. With national coverage as an

advantage, the organisation can offer its customers the products they need, on time,

wherever they are located.

ii) ensure customers obtain more high quality consistent services from fewer


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Speedy Hire has partnered with the right suppliers to ensure that products are of high

quality, and specification, and meet the needs of its customer base (including the new

initiative on sustainability, where Speedy has a range of electric vehicles).

Sustainability in construction has attracted huge focus, given that half the worlds CO2

emissions are as a result of construction. By helping its customers appear ethical, it has

captured a competitive advantage. (Again because Speedy has excellent market sensing

and pioneering spirit for first mover advantage.)

iii) increasing cross selling

The One Speedy initiative allows customers to purchase from two or more product areas.

It can cross-sell (and increase equipment and tool utilisation ratios: see fig 5.1

Segmental analysis). Customers have a one stop shop for both their tool and equipmentneeds.

iv) improving client relationships.

Speedy Hire conducts customer surveys (one of its qualitative measures). The current

feedback from three clients (AMEC, Carillion and Morgan Sindall, on page 28 of the

research) suggests that the company has achieved one of its key objectives.

The future for Speedy Hires business development and the role of marketing

The trend is continuing for preferred sole suppliers as indicated in the research.

Partners are also looking for a hire organisation that can deliver consistency, quality and

add value (see page 14 of the research).

I believe that Speedy Hire can further advance its favourable business development

stance by addressing the add value part of the above equation Speedy Hire can address


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1) Adding online product and safety demonstrations to the website.

2) Keeping promises. Sending the customer a text message to confirm when delivery

of tool or equipment will be made.

3) Online ordering, so customers can select the date, time and location of delivery, and

check availability.

4) Keep accurate records on equipment.

5) Make ordering less time-consuming.

6) Make invoicing faster and less expensive to process (see page 63 of research. This isa key issue that needs to be addressed as it currently costs the hirer 15.00 to process

each invoice).

7) Easier payment system (on account settle within 90 days). This would also in turn

help Speedy Hires worsening average debtor days (the number of days to collect

payments from suppliers. See fig 4.2 - Debtor days in 2007 were 110, compared with

97 days in 2005).

By showing to add value, Speedy Hire is making it easier for its key clients to do

business with them. Reducing complexity in doing business will be critical to Speedys

plans to move forward.

The use of relationship marketing and CRM (integrated) will allow Speedy to better

anticipate and respond to customers needs both now and in the future. This is shown in

the following diagram:


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The customer should be at the heart of the CRM strategy

Call centre

Product

service

ordering

Key

clients

Website

Product

delivery

Accounts

and

processing

After sales service

SUMMARY

Speedy Hire needs to continue to work with those clients who will add high value, low

cost to maintain, and whose investment will bring increased turnover. At this stage,

Speedy Hire has not embarked on a campaign of KAM management. I suggest that

Speedy Hire looks to doing this and setting up a KAM (Key Account Management) team.

KAM is an extension of relationship marketing and involves the careful selection of key

t t d d i d d lti l l l d f ti


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Speedy Hire will need to ensure that it has the right employees to be part of this team. It

may also be an idea to investigate the 14 onsite supported customers and select key

accounts from clients that Speedy is already engaged with.

Speedy certainly has the right customer orientation, and employees are well remunerated

and rewarded. Speedy already overcomes the biggest hurdle as the organisation is

already focused on creating and delivering value.

Comments

This answer tackles and evaluates why Speedy has been successful, but fails to really

get to grips with why and how this is reflected in the organisations financial

performance. Although a good answer this is a glaring weakness. It illustrates theimportance of reading the question and answering all the points raised within it.

SUMMARY

These answers are not perfect but they indicate good ways of attempting to answer

questions for case studies. It is important that candidates continue to address the

questions, justify strategies, use underpinning theories and details from the case

studies. A coherent approach will always be rewarded.


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Documents

SMIP Specimen June 08