BRAC UniversityIntroduction to Marketing

22 Marketing Plan: Walton Mobile

Group 5Tabassum AkhterFariha Zafor RimaMohammad IsmailSamiha Raisa Lisa Ayesha

Section 1Date of Submission 9th April, 2014Letter of Transmittal

April 9th, 2014Mr. Suntu Kumar GhoshAssistant Professor,BRAC University.Sir,With due respect, we are here to submit the following report on Walton Mobile Bangladesh according to the instructions given by you.After doing several secondary market research (information from websites, articles and a thorough online research), we have been quite successful in collecting necessary background information about Walton Mobile and, henceforth, design a suitable marketing plan. A survey among the existing and prospective Walton Mobile users also helped us to understand the market trend and the consumer behavior. The following report is the result of our findings and efforts.We appreciate this opportunity to work under you.Sincerely,Group 5Tabassum Akhter - 13304131Fariha Zafor Rima - 13304132Mohammad Ismail - 13304022Samiha Raisa - 13104161Lisa Ayesha - 12204021Executive Summary

This report is prepared to analyze and audit the current marketing strategies and prepare a marketing plan for Walton Mobile.

Our study revealed that in a continuously growing market, Walton Mobile has become a reliable name for customers. Countrywide network, inclination towards quality and yet maintaining affordability, and dedicate team of employees providing after sales service are the main causes of its success.

Keeping in mind the consumer demand of different target market, Walton Mobile has build up its product line. Since the consumer market is price sensitive, Walton Mobile has an approach of demand/value based pricing, and charges lower prices compared to its competitors. It has also adopted market penetration, product development and market development strategy for future growth.

Further investigations have revealed that to achieve the role of market leader, it will face challenge from foreign brands like Symphony. Yet, there are promising prospects of Walton in its current position. Appropriate market plan and its effective implementation will help it expand domestic and international markets in the future.

Table of Contents

Introduction

Company/Product Profile

Consumer behavior Types of Consumer Behavior Steps in the consumer buying behavior

Segmentation, targeting and positioning strategy Market segmentation Target market strategies Differentiation and positioning strategies

Product StrategyLevel of product Types of consumer product Branding strategies

Pricing strategyPricing methodPricing Strategy

Distribution or Location StrategyLevel of Distribution ChannelDistribution or Marketing Channel system

Recommendation and Suggestion

Budget, timing and control

Contingency plan

Conclusion

Introduction

The mobile phone has become an essential part of Bangladeshs customers everyday life and has made a safe haven in one of our pockets much like our wallet that we never want to leave at home while we head for our work. This is the dominant device that we now express ourselves through, get our work done and share our pains and pleasures with. Though, the introduction of telecommunication industry has been pretty late in our country compared to that of the neighboring countries, the introduction of Citycell and GrameenPhones GSM technology has created a boom in the cellphone industry of Bangladesh since 1997. Now a number of players, both international like Nokia, Samsung, Sony as well as local companies like Walton Mobile and MyOne, are battling very hard for their respective market share and the consumers.

Company/Product Profile

Walton Mobile in an elegant line of mobile phone handsets, owned by the Walton Hi-tech Industries Ltd (Walton HIL). Found and established by S.M. Nazrul Islam in 1977, Walton HIL has its production and assembly facilities in Bangladesh, and serves the local as well as the international market. It is the sister concern of the R.B. Group and has its factory located in Chandra, Gazipur. Walton is the pioneer of Refrigerator, Freezer, Air Conditioner and Motorcycle Manufacturing Technology in Bangladesh. The company desires to provide the latest technology based products with innovative design, excellent quality and many different models & capacities. The product line of WALTON brand are different types of Television (CRT, LCD, LED), DVD Player, Motorcycle, Refrigerator & Freezer, Microwave Oven, Steam Oven, Domestic and Industrial Generator, Manganese & Alkaline Battery, Air conditioner and various types of necessary and useful home appliances etc. Walton HIL is furnished with strong Research & Development (R&D) Division comprising of a large team of dedicated highly skilled engineers & technical personnel from home and abroad.Waltons vision is Amader Ponno that means Walton ltd. is always there to help the customers get the full assistance of communications services in their daily lives. They want to make it simpler for the customers to get what and when they want it, and as an implementation of that vision they are setting up many showrooms in different parts of the country. And the objective is to emerge as a global electrical and electronics brand by introducing Made in Bangladesh products worldwide and establish Bangladesh as an industrialized nation. With the slogan of Walton Mobile at every hand, Walton aims in providing unquestionable quality, longer durability and eye-popping style at a very affordable price.

Consumer BehaviorTypes of Consumer Behavior:Behavior is the decision processes and acts of people involved in buying and using products. The process consumers use to buy products and services is different for every individual and every category of product.Based on the degree of involvement and the degree of difference between the brands in the product category, there are four types of Buying Behavior:

The cell phone industry is broad and includes a wide range of models having number of features and applications to be used. Based on the product category and the uniqueness of brands of cell phones, we can classify the buying decision behavior into two types

Dissonance-Reducing Buying Behavior- Consumers with dissonance-reducing buying behavior have high amounts of involvement in buying mobile phones. However, buyers in this behavioral situation are perceiving very few differences among the brands of cosmetics they are selecting products from. The key word here is perceiving. There may be many real differences between the different brands, however the buyer's beliefs about the other brands are that there are very similar or essentially the same.Such as, costumers are unlikely to distinguish the difference between android phone of Symphony and Walton android phone, and may therefore suffer from post-purchase dissonance behavior. When softwares or operating systems of handsets are same, then customers perceive fewer differences in the brands, however they do get heavily involved while buying a phone due to high price, and thus the greater amount of risk associated.

Variety Seeking Behavior- In addition to complex and dissonance-reducing buying behavior, consumers in cell phone industry may also show variety seeking buying behavior. It refers to situations where there is low consumer involvement, but the consumer perceives significant differences between the brand options in front of them. In variety seeking situations consumers tend to do a lot of brand switching. There is no real brand loyalty, and seeking varieties in the product is the main motivation of consumers. Examples of such cell phone product category may include different features and different or stylish model/ design of different cell phones. For instance, Samsung is producing varied color range in cell phones for their different category consumers.

Steps in Consumer Buying Behavior:Consumer behavior involves the psychological processes that consumers go through in recognizing needs, finding ways to solve these needs, making purchase decisions (e.g., whether or not to purchase a product and, if so, which brand and where), interpret information, make plans, and implement these plans (e.g., by engaging in comparison shopping or actually purchasing a product) All the psychological perceiving of the marketing of a product plays an important role in the actual buying decision of the consumers. To efficiently and adeptly attend the customers need for any product, the general buying process requires be keenly observing and working out. Marketing scholars have developed a five stage buying processes. A consumer typically undergoes this process before buying a product.Need recognition: The buying process starts the very moment a need or problem is recognized by a consumer. A need or problem can be stimulated by external factors or triggered by internal factors. A marketer requires to study the different ways by which need for a particular product may arise. By doing so, they can easily counter the consumers need and solve their problem through their product. In case of buying mobile phones, need may arise in two ways: Internal factors- Consumers can face basic need to communicate because of the following reasons:I. When their older mobile phone is broken, distorted or defaced. II. If the need new features in their phones to cope up with the new generation.III. If their life style or status changes, for example a student getting into an university and needs to communicate with his friends or family at any time of the day. External factors- The consumers can be influenced to buy cosmetics or external need can be generated by:I. Getting exposed to advertisements , extensive promotions or promotional activitiesII. Peer pressure, leading an influential college/institution liveIII. Getting inclined towards android applications or windows8 software.Information Search: After the need or problem recognition, the consumers tend to search for information. Personal- This includes family, friends, neighbors, acquaintances Commercial- Consumers get consciously or unconsciously informed by and may learn about a mobile phone through advertisements, billboard slogans, and their official internet site or social sites also may educate the consumers about the cosmetic. Public- Customers can collect information from magazines, films, AVs of experts. Experiential- Examining any particular model of cell phone in Waltons or any other companys showroom or in the retail shops and judge to know more real information about the mobile phone.Evaluation of Alternatives: After collecting all the information gathered, consumers will then evaluate all the pros and cons of the alternatives under different criteria: Quality- Judge on which brands product is of better quality and also satisfies their priorities or need. Durability- Think about which product will last longer in a much comparative price. For example, they may think whether a particular cell phone can be used for a long time and is of relative price. Price- Price is the most crucial factor that a consumer always keep in mind while buying a product, that is it too expensive or cheap or whether is it worthy of the brand value. Image and features- If the product is well known or reputed and has attractive solutions to their problems, then the consumers give that product more preference. Extra facilities- The consumers will also see if the cosmetics brand provides extra facilities of after sale services, guarantee cards, or provides any attractive offers like free screen protector or phone covers.Purchase decision: Can be of two types: Attitude of others- A persons favorable or unfavorable evaluations, emotional feelings and action tendencies toward some subjects or products. The quality of customer service, sales persons behavior or knowledge on the product he is selling, and comfort ability of shopping atmosphere leaves an impact on the purchase decision. Unexpected factors- A sudden change in life style or income status due to loss of job or a job promotion. For example, if the consumer loses her job, she might switch to less expensive mobile phones.Post purchase decision- Can be of two types: Satisfied- The recognized problem is solved after the purchase of the cosmetic. It leads to repetitive buying, spread positive image of the company.Unsatisfied- Not being happy about the purchase as it could not fully satisfy the stimulated need. It ends up portraying a negative impact on the consumers and thus on the overall market, also the consumers lose their trust on that brand.Segmentation, targeting and positioning strategyMarket Segmentation:Segmentation is one of the most important factors of strategic marketing. Market segmentation is one of the steps that go into defining and targeting specific markets. It is the process of dividing a market into a distinct group of buyers that require different products or marketing mixes. Markets can be segmented or targeted using a variety of factor. The bases for segmenting consumer markets include: Demographical bases (age, family size, life cycle, occupation) Geographical bases (states, regions, countries) Behavior bases (product knowledge, usage, attitudes, responses) Psychographic bases (lifestyle, values, personality)The total targeted population for Walton Mobile is around 10 million users, and it mainly segments its target market on Demographic bases, as shown below Demographic

Income GroupAge Group

Middle Income Group

Look for the best deal in the most affordable prices

Mostly price sensitive

Low- Income Group

Uses mobile phone as a basic need for communication

Very price sensitive

Teen/Younger Generation

Between 18-30 years old

Prefer advanced mobile features (internet, unique application, video etc. )Adult/ Working Population

Mostly in between 30-50 years old

Prefers a balance between multimedia, feature and simplicity in usage

Older/Aged people:

Above 50 Years OldLess/Uneducated

Prefer simple phones with basic features like phone calls and texting

Target Market Strategies:On the basis of the Market Segmentation shown above, Walton Mobile follows a Differentiated Marketing strategy, where it produces different product for different groups of costumers. The following diagram illustrates the market segments and differentiated products offered by Walton Mobile for each of the market segment Entertainment Walton L Series Walton T Series Walton Q series

Information Walton Primo Series

Communication Walton B Series

Differentiation and Positioning Strategies:Product Positioning is the way the product is defined by the consumers on important attributes. It is the place the product occupies in consumers minds relative to the competing products. A firm can differentiate its products and create its desired positioning using the following strategies:

Product Differentiation Service Differentiation People/Employee Differentiation Channel Differentiation Image DifferentiationThe Walton Mobile aims at differentiating its products from its competitors using the following strategies:Product Differentiation: Form/Shape Walton introduces sleeker, thinner and lighter phone range, making it handy for the customers to carry as well as giving them an upmarket and standard outlook. Features - Fast and powerful Processor, coupled with the latest Android operating system and a variety of services and functions are offered by Walton in their latest Primo series.

Service Differentiation: Maintenance and Repair Service - Walton provides an adept after sales service team. In fact it is the biggest after sales servicing network in Bangladesh. Walton Mobile owns forty-three after sales servicing points all over Bangladesh, which are ever so alive to solve the tiniest problem also. Walton equally values its sales and after sales service for maintaining a long and positive relation with its customer and thus retain and increase the customer.

Channel Differentiation: Walton Mobile is being made available in individual retail outlets (along with other competitor brands) as well as in Walton Plazas (own showroom) and countrywide dealers, enabling the product to have an increased coverage and wider distribution channel

Image Differentiation: Logo Established in 1977, the logo of Walton HIL is very well known among all groups of consumers, and has its reputation earned as an affordable and good quality provider of products. The logo, therefore, allows Walton Mobile to differentiate easily from its competitors. Slogan The slogan of Walton Mobile at every hand is easy to remember, catchy and very widely publicized in order to demonstrate the vision of the company and create an affordable image in the target markets minds.

Product StrategyLevel of product:Branding is an established source for sustaining the competitive advantage in the marketplace. According to Kotler (2010) brand and design are theparts of the products actual element. There are threelevels for a product/service as shown by the diagram:

The Core Product is the benefit of the product that makes it valuable to the consumers. According to Kotler (2010) the core product addresses the question what is the buyer really buying. So for cell phones, the core product could be the need for communication, or entertainment or information.

The Actual Product - is the tangible, physical product which is required to get the core product. At actual level the support for Walton Mobile comes through design, aesthetics, brand and packaging.

The Augmented Product - is the non-physical part of the product. It usually consists of lots of added value, for which you may or may not pay a premium. It is an issue after developing a dependable core layer and actual layer, and to remain competitive in the market, a marketer should focus more on providing augmented products. Walton Mobile provides augmented services such as its customer care service, warranty, latest software installation services etc.

Types of Consumer ProductsConsumer products are the products used by the final consumers for personal use. Consumer products and services can be categorized in a number of ways:

1. Convenience offerings2. Shopping offerings3. Specialty offerings4. Unsought offerings

For Walton Mobile, which has many different competitors providing more or less equal features and facilities to the customers, the consumer product could be classified as Shopping Product, where the consumers carefully compare on suitable price, quality and style. Also, the level of involvement is high among the consumers for the purchase of Walton Mobile because the price is higher than the convenience products. It, therefore, becomes very vital for the marketers of Walton Mobile to provide information through advertising, along with keeping an ideal balance between affordability and quality.

Branding Strategies:A branding strategy helps establish a product within the market and to build a brand that will grow and mature in a saturated marketplace. Making smart branding decisions up front is crucial since a company may have to live with the decision for a long time. There are basically four brand development strategies, which are illustrated below:

Walton Mobiles follow the Line Extension strategy in order to develop its brand, by launching a new, slightly different item in the same product category such as Walton L, Q and T series cellphones. The strategy helps Walton Mobile reduce risks associated with new product development. Due to the established success of the parent brand, consumers will have instant recognition of the product name and will be more likely to try the new line extension. As a result, promotional costs are much lower for a line extension than for a completely new product. However, Walton Mobile itself is a Brand Extension of its parent company Walton HIL, and the already established reputation of its parent company enables the new brand extension grab market share at a quicker pace.

Pricing StrategyPricing Method:Current Pricing Method: Price is the only element in the marketing mix that produces revenue, while all other elements represent costs. Price is also one of the most flexible marketing mix elements. Pricing is the number one problem facing by most of the companies. Prior to that, it is really important to focus on pricing and come up with a pricing strategy that helps the company to set the highest position. Walton is a Bangladeshi company. Mobile phones of Walton are now very updated and they are trying to give the best quality. There are different types of pricing. Such as- cost based or cost plus pricing, demand or value based pricing, and competition based pricing. From these pricing Walton mobile company is currently following the Value or demand based pricing. When the product price is determined based on the demand it is considered as the value based pricing. Here, the customer expectation is the vital point. If the customers give more value to the product then the price would be high. It depends on the value or the demand of the product. Mobile phones are one of the basic necessities of people for communication. In todays world people not only want to communicate through phone calls but also use Internet & 3G calls. Customer always keeps these factors in their mind. In addition to that, Walton is designing their phones according to the customers expectation. They are focusing on the features & quality of the mobile while making the mobile phones. When Walton will be able to satisfy the customer expectations they will give more value to the product. Value based pricing is more customer driven. In this way, Walton is applying the value based or demand based pricing.

Pricing Strategy:There are many ways to price a product. Marketers mainly follow four types of pricing strategies. They are- New product pricing strategies Product mix pricing strategies Price adjustment pricing strategies Price changes pricing strategiesWalton mobile is following the New product pricing strategies. It is a new company in the electronics sectors, so they have to follow the new product pricing strategies. Under new product pricing strategies there are two factors. They are- Market skimming pricing Market penetration pricingAs Walton mobile wants to create a new market segment of its own they are going for market penetration pricing rather than market skimming pricing. The price charged for products and services is set artificially low in order to gain market share. Their objective is to increase sale, enter in the new market, increase market share. Here, marketers set the lowest or minimum price for the services. Once this achieved, the price is increased. They are also giving high quality within a low price.Market penetration pricing is appropriate in two conditions. They are- Marketers should be price sensitive- As different brands of cell phones are available in the Bangladesh market, this market is price sensitive. Almost all the mobile phone industries are today competing to grab as much market share as possible, thus they opt to charge low price to allow the demand law: the lower the price the higher the demand. Therefore, Walton tries to provide their phones at a low price with equal quality as their competitors. When the sells will increase, the production cost or distribution cost will decreaseThese are the pricing strategies of Walton mobile Bangladesh.Product Mix Pricing Strategy: Walton mobile company also follows the product mix pricing strategy. Such as they are giving Optional product pricing. When a customer buys any mobile they will provide some extra accessories or optional products to use with the main product. For instance, they are offering flip cover of varied designs and colors for almost every mobile model. Also if the headphones of the mobile get damaged then the customer can get another one from their showroom.

Distribution or Location StrategyDistribution Channel: Distribution or set of intermediaries is to pass finished or semi-finished goods from producers to the final consumer. A distribution channel can include wholesalers, retailers, distributors and even the Internet. Channels are broken into direct and indirect forms, with a "direct" channel or zero level channel allowing the consumer to buy the good from the manufacturer and an "indirect" channel or one/multi level channel allowing the consumer to buy the good from a wholesaler or through a channel of distribution. Walton has a countrywide retail sales outlets and service points network. Therefore, it can be deduced that Walton uses a one level channel distribution as Walton is well established in the native country and thus utilises its years of endowment and experience. Walton cell phone uses a number of their own retail shops (Walton Plazas) with specialized and knowledgeable sales persons. Walton Mobile owns forty-three after sales servicing points all over Bangladesh, which are ever so alive to solve the tiniest problem also. It also has a number of distributors who make sure Walton is present in as many independent retail shops as possible to succeed on their motto Walton at every hand. Walton has a total of 442 exclusive distributors from the companys 18 zones across the country, out of which 64 were rewarded as best distributors.

Distribution or Marketing channel systems:In cases where a marketer utilizes more than one distribution design, then the marketer is following a multi-channel or hybrid distribution system. As we discussed earlier in this report, Walton undertakes both independent channels (conventional distribution system) and dependent channels (vertical distribution system) for their product to reach to its final consumers. Walton has authorized distributors who distribute the cell phones to retailers and then the retailers hand the products to the end consumers. On the other hand, it also uses its own Walton showrooms where they deliver their product directly from their production place to sell it to the consumers through its own experienced and satisfactory way. The distribution channel system is illustrated below: Final ConsumerBrand Showrooms (Walton Plazas)RetailersAuthorized DistributorsManufacturer(Walton Mobile)

Number of intermediaries:Many producers do not sell products or services directly to consumers but instead use marketing intermediaries to execute an array of necessary functions to get the product to the final consumer. These intermediaries, such as middlemen (wholesalers, retailers, agents, and brokers), distributors, typically develop a firm committal bond that builds in the one channel or multi channel marketing chain. The marketing intermediaries are:

1. Intensive distribution2. Selective distribution3. Exclusive distribution

Walton Hi-tech Industry limited uses selective distribution, which is in between intensive and exclusive distribution. Selective distribution involves more than one but less than mass distribution. As mentioned above in the report that Waltons cell phones are a shopping product and thus, the most appropriate way to elevate Waltons cell phones in the existing Bangladeshi market is to have selective capable distributors to acknowledge the market requirement for their products and make the products availability convenient for the consumers. For example, Dhaka is a densely populated district of Bangladesh and thus need large number of shops to have Walton products, that is enough products is accessible already in the market for the potential buyers.

Recommendation and Suggestion

Predatory Pricing: As competition is already in place due to the penetration on foreign market(s) like Sony, Samsung; to be more precise Symphony, My One which are Waltons main competitors, Walton should always keep the price low. Here, Walton should follow predatory pricing, where a price is set below the production cost. If such a step is taken then it would drive competitors like My One and Symphony out of the market, since they are foreign they cannot survive by charging such a low price as heavy transportation costs, custom tax are involved. Therefore Walton being a home brand does not have to bear such costs. However, in the short sun they will make loss, but in the long run when competitors are driven out, as well as barriers to entry has been created, it is going to benefit Walton, as they can then be monopoly. Change in Attitude: Walton is giving everything whatever Samsung, Sony are giving but at a much lower price which can be affordable by people from any socio economic background. However, its competitors like Symphony or My One are also doing the same. Therefore Walton needs to do things differently. They need to make people believe, that they will not only going to give what their competitors are giving, but they are going to give them something different or do things differently. For this, Walton needs to heavily invest in research and development. They should add features which Sony or Samsung hasnt provided it, make the phones look more thin and attractive, however, keeping a low price. Advertisement: Walton is a home based product, therefore its cost decreases in many ways. Therefore Walton can spend a lot on advertisement. They can do pioneer advertisement, under which they should only make people aware of their availability. Then, comparative advertisement, under which they can compare their product with competitors products. Then, competitive advertisement, under which the will only highlight the product benefits. Independency: One of the drawbacks is, it is dependent on imported raw materials, which increases the cost. Therefore, it somehow can manage to reduce imports and rely on home based raw materials, then it can increase the sales even more by reducing the price and they will also be benefit from economies of scale. Further Segmentation: Market for Wanton mobile phones, should be segmented even farther, for example, different mobiles for boys and girls. Even though, this is a risky theory, however, if the segmentation were as per customer requirement, it would be very catchy.

Budget, timing and control

Budget:As per, Walton is offering good features and low rate mobile phones , they should make a budget that more applicable for making profit. For example, if they want to make a approximate profit of phones around2.5 lacs per month in terms of having a good sales of 500000, they need to adjust their budget . They can spend approximately 100000 for advertisement as it will increase the demand of their phone compare to Symphony and My One. Then, they can spend 20000 for web site, 15000 for printed materials and they can hire sales person for 10000 to 15000 per sales person for good sell. Now, it will be more clear by observing the below table:

BudgetApprox.

Sales 500000

Advertisementwebsite10000020000

Printed materials15000

Salary115000

Total Expense250000

Total Profit per month250000

By observing the above table it can be said that if Walton spends 250000 taka per month for their expenditures , their total cost per year would be 3000000 taka . Therefore, their sales must be increased every month otherwise they will not be able to have profit after this kind of expenditure.

Contingency plan:As per recommendation, they should set their cost lower than production cost so that sales increases. Now, if this plan does not work in terms of gaining profit, they can increase their budget range for some times or they can go reducing expenditure in a proper manner. Then, it is said that they should go for comparative advertisement but as back plan they should also try to highlight their service, their quality and their market strategy so that if one fails another works.

Conclusively, we can say, Walton Mobile has build reputation for redefining Bangladesh from being a consumer country to producer country for mobile phones, which gives the company a strong edge to increase its market share in the industry. Despite having strong competitors like Symphony and MyOne, Walton Mobile is moderately successful in getting customers attention and grabbing the market share. It is in its growth stage and has great scope for further growth and brand development. Appropriate strategic, tactical and operational plans at all levels of the organization along with proper flow of financial resources will, therefore, become vital for Walton Mobile to achieve all the objectives and recommendations provided in this marketing plan.

References Walton BD Home page -http://www.waltonbd.com/index.php?route=product/category&path=24 Walton Bangladesh: A Brief History http://www.uns24.com/detailsnews.php?nssl=5c572eca050594c7bc3c36e7e8ab9550&nttl=15012013743 Walton leaves Samsung behindhttp://www.newstoday.com.bd/?option=details&news_id=2358764&date=2013-10-09