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Beuth University of Applied Sciences Berlin
MBA Renewables
WRITTEN ASSIGNMENT
MARKETING ANALYSIS AND INSTRUMENTS
Lecturer: Dr. Sonja Leuthi
Student: Mario Maras, Dipl. Ing.
Berlin, 13th January 2014
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Table of contents
Task 1. Importance of Marketing.........................................................................................................3
Task 2. Main Criteria for Market Attractiveness.......................................................................................3
Task 3. Market Segment....................................................................................................................4
Task 4. Competitors..........................................................................................................................5
Task 5. Product...............................................................................................................................5
Task 6. Product to Customer.............................................................................................................6
Task 7. Pricing.................................................................................................................................6
Task 8. Communication.....................................................................................................................6
References.......................................................................................................................................7
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Task 1. Importance of Marketing
First of all, definition of marketing should be presented: "Marketing is a process of definition in the
business and social organization through which individuals and groups satisfy their needs and desires
by creating, offering and exchanging products and other items of value with each other.". Terms that
should be defined are: needs, desires, demand, product, benefit and satisfaction. To plan marketing
activity, process should be worked through: situation should be analysed, goals should be defined,
strategies should be developed, marketing mix should be presented, realization should be planned
and process should be controlled and after controlling phase, situations should be analysed from
beginning.
As trading solar products is an option, the best option is importing solar components from other
countries, i.e. China which provides cheapest solar modules in the world. Manufacturer with good
price-value should be chosen, legal aspects should be analysed - if there are any political barriers
between producer country and importer country, prices should be optimized to be in level with other
importers and producers, with possibility to offer cheaper product. Furthermore, whole logistics
process should be defined to avoid out-of-stock possibility, advertising policies should be defined and
be in line with legal requirements. Setting objectives like being No. 1 trader in five years is very
important, because without specific and reachable goals, marketing strategy won´t work. Financial
resources should be prepared before starting business, and all budgets should be defined, realization
of plans should be defined and worked through, and at the end whole process should be controlled
and at the same time analysed for potential mistakes to learn from them and to improve the process in
the future.
Task 2. Main Criteria for Market Attractiveness
Three main criteria that should be taken into account are environmental analysis, competitive analysis
and market research. Only for 2012, Inter-American Development Bank announced $3 billion
investments for "clean and sustainable energy" in Latin America. Development of first large scale solar
energy project - two 20MW power plants in Peru worth $123 million were announced in 2011 which
will generate 80GWh for 18.000 homes. China has been investing into solar projects in Brazil and
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Chile providing raw materials and financial support for new projects. Latin America strives for new
energy projects and as regions is called Sun-Belt it is very attractive for investors. Energy demand has
increased in whole region for 35%, therefore there is a lot of potential for investments in solar energy
projects. In 2011, Government in Chile has set a goal to produce 20% of electrical energy from
renewable resources by 2020. Atacama Solar is building $773 million, 250 MW PV project which is
expected to go online in 2016 which will consist of over 11.000 PV units. Investment agencies and
private capital markets have been expanding their business in Latin America making Latin America
very desirable place for expanding business in renewable energy, especially in PV.
Figure showing Total Energy Supply in Peru in 2002 shows great potential for expanding business in
this country and with opening market and setting objective to reach 20% of energy demand from
renewables by 2020 shows a great potential for business development.
Task 3. Market Segment
Suggestion would go to small off-grid systems. As there is great demand for electrical energy, and PV
provides cheap solution to families with small income. From available information, large projects
where being developed which includes big companies which sell electricity to public grid. By offering
small cheap solutions, all people who might have no access to electricity or buy it from public grid
system could go into independence from government. Great examples come from South East Asia
where companies provide cheap off grid systems that are being monitored by internet connection, they
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are fully financed by companies and families use electricity and pay electricity bills with their mobile
phones. With this solution, families with very low incomes can buy clean electrical energy and stop
burning kerosene during night time which decreases their chances for health damages. This option
provides not only good business solution, but is very social in its character which much more
important. Another option for financing small off-grid systems are micro credits provided by banks and
private companies. Penetration of this market segment has been shown very successful in
Bangladesh. Bangladesh became world´s biggest solar off-grid user . Over the past decade, since the
Bangladesh government launched a rural electrification programme supported by the World Bank and
other international aid bodies, the number of off-grid installations in the country has rocketed. In 2002,
installations rates stood at 7000; today that figure has exploded to nearly 2 million and counting, with
average installation rates now topping 80,000 a month.
Task 4. Competitors
In Chile, three big examples could be given. In Atacama Desert in northern Chile Atacama Project is
being developed. This project has potential to become world greatest power plant with capacity of
250MW PV, worth $123 million which is expected to go online by 2016. In October 2011, Solar Chile,
a subsidiary of Fundación Chile, and First Solar signed a strategic alliance to co-develop utility-scale
solar projects in Chile. First Solar will provide its cadmium telluride (CdTe) thin-film PV modules and
engineering services to the projects which are still in the planning stage and subject to definitive
project agreements. U.S.-based Tegal Corp. also recently announced that its large-scale solar project
subsidiary, Sequel Power, has opened offices in Buenos Aires, and Santiago. Sequel Power has more
than a dozen active projects in six countries with major partners in various stages of developing solar
utilities, including other large-scale solar projects in Argentina and Ecuador. As can be seen, most
examples are related to large PV projects providing much space for small off-grid projects.
Task 5. Product
Product of off-grid systems is electrical energy for small households who don´t have access to
electrical energy or are dependable to large power grids. Dependency on big companies include
financial dependency because these companies set prices which are in line with their company
policies and strategies, government strategies and strategies of companies that provide components
for power plants. All of this can be avoided if family would install small PV off-grid system and produce
electrical energy and heating by themselves.
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Task 6. Product to Customer
To be able to provide off-grid system to customer, it is important to gain technical knowledge for off-
grid system and have all necessary equipment in stock. Panels, inverters, cables, batteries, billing
solutions, trained technicians etc. For this kind of solution there is actually only one channel that
includes all aspects mentioned above.
Task 7. Pricing
Pricing is amount of money that customer has to pay for a product. This type of business solution
presents unique selling proposition and therefore, price sensitivity is low. It would be great if concept
including cheaper price than bigger companies could be developed. With this kind of concept there are
great opportunities for expanding business in energy developing countries.
Task 8. Communication
Advertising is very important part for attracting new customers. As there are no available information
from companies that provide these solutions as this market segment is still new, promotion on trade
fairs, television, support from government on national television channels, newspapers, store chains
are good channels for advertising. After new customers are attracted and projects are developed,
good reputation among people will surely attract most of new customers. Here it is important to
segment target customer - those are people with low incomes who possibly don´t have access to trade
fairs, television sets, etc. Therefore, honest and human contact would be best solution for attracting
new customers.
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References
Peter Meisen (2009). "Renewable Energy Potential in Latin America". Global Energy Network Institute.
Retrieved on 09th January 2014.
http://www.as-coa.org/articles/energy-update-solar-power-latin-america. Retrieved on 05th January
2014.
http://pv.energytrend.com/research/Latin_America_Solar_Market_20111207.html. Retrieved on 06th
January 2014.
http://www.pv-
tech.org/friday_focus/friday_focus_how_bangladesh_became_the_worlds_biggest_domestic_off_grid
_pla. Retrieved on 11th January 2014.