AllRound Marketing PlanBy: Ebonee A. Elliott

This document will be a comprehensive blueprint which outlines the company AllRound’s overall marketing efforts. The company’s advertising and marketing efforts for the coming year as well as a statement of the marketing situation, a discussion of target markets and company positioning and a description of the marketing mix will be explained thoroughly.

2/24/2015

Contents

Description of the Organization …………………….......1

Situation Analysis……………………………………… 4

Objectives………………………………………………14

Marketing Strategy…………………………....… 14 cont.

Marketing Programs and Tactics…………………….…17

Financial Documents………………………….… 17 cont.

Monitors and Controls.................................................... 19

Contingency Plans.......................................................... 20

Executive Summary........................................................ 21

1. Description of the Organization

1.1 Mission Statement: The Customer can count on us to professionally network functional pharmaceutical products to allow us to exceed customer expectations.

1. Philosophy, Values, & Ethics: The Company of AllRound has a philosophy that promises all of its customer’s medication at an affordable price while still working efficiently. The company values its customers greatly and appreciates customer feedback and satisfaction rate.

2. Business Domain: The Business Domain for AllRound is the Pharmaceutical Business.

3. Competitive Advantage: One of the many competitive advantages AllRound has is its affordable price, Brand Awareness and Brand Satisfaction.

4. Energizing Factor: There are many opportunities for AllRound to grow further into the pharmaceutical marketplace.

1.2 Organization Departments:

A.

A. Manufacturing Department: Suggest Retail prices to retailers are below the recommended price Manufacturers commonly offer volume discounts of 15-40% The support of a manufacturer’s sales force is critical to the success of a brand

The Manufacturing Department allows for Flexible manufacturing a technique which accommodates AllRound’s’ plants to accommodate several product lines. Once capacity is built, however, it cannot be decreased.

B. Finance Department: Sales of $355.3 Million Last Period Received budget to make marketing decisions for the AllRound brand The marketing budget must cover all sales force, advertising, and consumer and trade

promotion expenditures.

The Finance Department notes that AllRound is a successful and profitable brand with sales of $355.3 million at the manufacturer's level last period. The gross margin was $172.3 million, and the margin after advertising and promotional expenses was $145.3 million. The margin after all marketing expenditures, including sales force and administrative costs, was $129.5 million. The AllRound brand also carries its share of fixed costs, including the plant where AllRound is produced and a share of corporate overhead charges.

C. Competitive: Competition and distribution are free (data) The Five C’s Understanding the dynamics of competition is critical to the success of any marketing plan

AllRound’s competition explained that the OCM group monitors competitive activity in a number of areas, including pricing and promotional allowances, advertising, consumer and trade promotion, and sales force allocation. It is also important to explain the 5 C’s which are Context, Competitors, Customers, Collaborators, and Company (Internal and External Analysis).

D. Marketing Department: Marketing decisions are made as a group Understanding the basic marketing variables before becoming more involved The marketing research firm conducts this survey every period.

The Marketing Department The task of the AllRound brand management team is to maintain long-term profitability and market share in an increasingly competitive and changing environment. With great enthusiasm, the OCM group sets out to do the job. Each member has separate assignments, but all are concerned with the performance of the AllRound brand and any new brands that might be forthcoming. It will be necessary to use the information presented in the exhibits and possibly other marketing research studies to assess AllRound’s situation.

2. Situational Analysis

2.1 Internal Situation Analysis/ External Situation Analysis:

Context: AllRound has multiple environmental factors that the firm has to monitor. The demand for cold medicine is very much dependent on the number of people reporting various illnesses, as well as seasonal influences (increased occurrence of influenza or high pollen count). There may be some fundamental changes in health concerns that may be monitored by tracking physician recommendations or the purchasing decisions of consumers. The effect of inflation on costs and pricing is also considered.

Competitors: A benefit from understanding the dynamics of competition is that through the analysis of competitive marketing programs, one can often gain insight into what may be a more effective use of marketing resources. The most difficult facet of the dynamics of competition is anticipating the retaliatory moves of AllRound competitors and deciding whether or not they might neutralize the marketing programs. AllRound should consider the effects of changes in a competitor's price, sales force, promotion, or advertising approach on the success of the strategy.

Customers: The customers of AllRound incorporate two main elements of the 5C are which include: the nature of demand and the extent of demand. The nature of demand s includes understanding what benefits the customer is seeking, how they learn about products, what their motivation is for purchasing, where they buy the product, what they consider when choosing a product, and the like. The study of these types of issues is often called consumer behavior. The second analysis is the extent of demand. This includes market size and growth, purchase quantities and usage rates, and etc.

Collaborators: Another group of people who influence your customers’ decisions are collaborators (i.e. doctors and pharmacists). The collaborators are more concerned with using the proper medication for the symptoms and situation and are less likely to be swayed by advertising. However, these influencers still need to be aware of a brand to recommend it, and if two brands offer similar relief, they may be more likely to recommend one brand over another if they are more familiar with it. So, advertising and sales force—especially the detailers (salespeople whose primary task is to inform clients about new products)—do influence doctors and pharmacists.

Company: The managers should know if the company is successful, growing, has good margins, unique, meet customer needs, well known, can charge a premium price, and has strength in the distribution channels. Related to the product, AllRound has an overall positive position and image in the marketplace with both customers and collaborators.

2.2 SWOT/TWOS Analysis:

Internal Factors Strengths (S) Weaknesses (W)

Opportunities (O)

Wide distribution area Strong Brand Name Loyal Customers (Brand Loyalty) Fast Product Transportation Great Marketing for Allround

Product Ready/Access Capital High Market Share

Not enough penetration in other markets

Slow in Responding to Trend Shifts

Few/No brands in the “cold”, “cough”, “allergy” product space

Threats (T)

Competition Add other product options

The U.S economy Established Brand Competition

Strengths: Superior resources and/or skills that can be drawn on to exploit opportunities and diminish threats

Weaknesses: Deficiencies in resources and/or skills that inhibit the firm’s ability to capture opportunities or that must be overcome to avoid failure or underperformance.

Opportunities: Environmental (consumer, competitors, channels, economy, technology, deregulation, etc.) states of being or trends with positive consequences. They provide a potential new basis for competitive advantage and provide a possibility of improved performance if pursued.

Threats: Environmental states of being or trends with negative consequences. They may impede the implementation of strategy, increase the risks of strategy, increase the resources required, or reduce performance expectations.

External Factors

2.3 Business Portfolio Analysis:

Description:

According to the graph below, AllRound is considered a Star product and a Cash Cow at the same time because the marketing and management team is effectively observing and evaluating its market share.

2.4 Marketing Mix Table:

Marketing Mix

ElementMarket

Segment ColdMarket

Segment CoughMarket

Segment Allergy

Product Strategy Scope Strategy Diversification

Strategy Scope Strategy

Price Strategy Economy Pricing Penetration Pricing Psychological Pricing

Promotion Strategy

Social Media Point-of-Sale

Promotion and End-Cap Marketing

Causes and Charity

Social Media Point-of-Sale

Promotion and End-Cap Marketing

Causes and Charity

Social Media Point-of-Sale

Promotion and End-Cap Marketing

Causes and Charity

Place Strategy Intensive Distribution Exclusive Distribution Selective Distribution

Product Strategy: For the market segments for Cold, Cough, and Allergy the strategies that would be the most effective are the scope strategy and the diversification strategy. The expected results for the scope strategy include: Increased growth, market share, and positive profits. With effective utilization, AllRound would achieve a monopolistic-like control over the market and enlarged product/market opportunities. The purpose of using the diversification strategy is to not only increase sales, profitability, and flexibility but to develop and introduce new and unfamiliar products to possible customers.

Price Strategy: Three different price strategies should be used for AllRound’s new products and they are the: Economy Pricing, Penetration Pricing, and Psychological Pricing. Economy Pricing is when companies keep prices low and attract a specific segment of the market that

is very price sensitive. Penetration Pricing is a strategy designed to capture market share by entering the market with a low price relative to the competition to attract buyers. Lastly, Psychological Pricing is when a product is $1.99 as opposed to $2.00; the customer will most likely choose the $1.99 product because of the minor distinction in price.

Promotion Strategy: This is how AllRound will promote the new products. The best way for AllRound to promote the new products is through Social Media, Causes and Charity and Point-of-Sale Promotion and End-Cap Marketing (basically the selling of a product or products and promoting items in stores).

Place Strategy: AllRound should use all three of the major place strategies which are Intensive Distribution, Exclusive Distribution, and Selective Distribution. Intensive distribution is used commonly to distribute low priced or impulse purchase products. Exclusive distribution involves limiting distribution to a single outlet. The product is usually highly priced, and requires the intermediary to place much detail in its sell. Selective Distribution is when a small number of retail outlets are chosen to distribute the product.

2.5 Components of Competition (Porter):

The Organization: AllRoundThreat of New Entrants

Believe Besthelp

Coughcure Defogg Dripstop Dryup Effective End Extra

Bargaining Power of Suppliers 1st Analgesic 2nd Dcngest 3rd Cough Supp 4th Alcohol 5th Antihist

Bargaining Power of Buyers Mass Merchandise Stores Grocery Stores Chain Drug Stores Convenience Stores Independent Drug Stores

Threat of Substitute Offerings Dryup Coughcure Defogg

2.6 Products on Markets and Sales of OTC Products:

Company Name Product Sales (millions) Product(s) on Market

Allstar Brands $355 “allround”-4 hour multi-symptom cold liquid

B&B Heath care $286 “believe”-4 hour allergy capsule“besthelp”-4 hour cold capsule

Curall Pharmaceuticals

$199 “Coughcure”-4 hour cough liquid“Coldcure”-4 hour children’s’ cold liquid

Driscol Corporation $255 “Defogg”-4 hour allergy Capsule“Dripstop”-Cold nasal spray“Dryup”-4 hour multi-symptom cold capsule

Ethik Incorporated $395 “Effective”-cold nasal spray“End”-4 hour cough liquid“Extra”-12 hour cold capsule

2.7 Industry Identification in terms of Number of Sellers:

Oligopoly: For the company AllRound the importance of marketing mix is to promote in order to achieve the perceived product differences.

2.8 Over the Counter Medicines Industry Regulations:

Max. Allowed

Analgesic

Antihist

Dcngest

Cough Supp

Expect

Alcohol

Description

1000 4 60 30 200 20 (mg/4-hr dose)Allround 1000 4 60 30 0 20 4-hr multi liquidBelieve 0 4 0 0 0 0 4-hr allergy capsuleBesthelp 0 4 60 0 0 0 4-hr cold capsuleCoughcure 0 0 30 30 0 10 4-hr cough liquidDefogg 0 4 0 0 0 0 4-hr allergy capsuleDripstop 0 0 60 0 0 0 Cold sprayDryup 1000 4 60 0 0 0 4-hr multi capsuleEffective 0 0 60 0 0 0 Cold sprayEnd 0 0 0 0 200 10 4-hr cough liquidExtra 0 0 120 0 0 0 12-hr cold capsule

This chart describes in detail what ingredients can be found in the Allround product as well as its competition and what the products are.

2.9 Sales and Demand Analysis:

The charts above simply describe Supply and Demand which is how much product(s) is/are available and how much of a product(s) that customers and consumers want.

Marketing Budget Break Even (Units)

(Fixed Costs + Total Marketing Expense)/ (SP per unit - Variable Cost per unit)

(62.4 + 42.8 +8)/ (3.49 - 0.5) - 1.79= 87.66

The company would continue to make profits if A competitor has dropped its price by $0.50 causing the company to consider matching their price cut.

2.9.1 Consumer Analysis:

This graph explains how the awareness, purchases, and satisfaction for AllRound and all of its competition compare to each other.

Planning Assumption:

The product for AllRound is expected to grow exponentially, not only because of the strong brand name AllRound currently holds, but because of the introduction of new products that AllRound has previously not marketed in.

2.9.2 Forecasts:

Sensitivity Analysis

(Fixed Costs + Total Marketing Expense)/ (SP per unit - Variable Cost per unit)

62.4 + 42.8 +8/(3.49 - 1.79)= 66.58 The company would still be making profit if managers requested an additional $8,000,000 from Senior Management to run an advertising campaign promoting AllRound.

AllRound will have a positive market share and net profits if they successfully penetrate the new markets.

3. Objectives

3.1 Marketing Objectives:

Increase Sales Improve New Product Awareness Maintain a Strong Brand Name Keep Loyal Customers While Gaining New Ones

3.2 Program Objectives:

Successfully penetrate new markets Maintain Brand Name Gain New Customers Increase Sales Improve all Product Awareness

4. Marketing Strategy

4.1 The Strategic-Planning Gap:

AllRound is in the integrative growth simply because it is a growth strategy in which a company increases its sales and profits through backward, forward, or horizontal integration within its industry. A company may acquire one or more of its suppliers to gain more control or generate more profits (backward integration). It might acquire some wholesalers or retailers, especially if they are highly profitable (forward integration). Or finally, it might acquire one or more competitors through acquisition (horizontal integration)

4.2 Integrative Growth:

The Suppliers are Analgesic, Dcngestrd, Cough Sup, Alcohol, and Antihist. Wholesalers include: Mass Merchandise Stores, Grocery Stores, Chain Drug Stores, Convenience Stores, nd Independent Drug Stores. The competitors for AllRound are Dryup, Coughcure, and Defogg.

4.3 Market/Product Focus:

AllRound will continue to produce it’s 4 hour multi-symptom cold liquid because of the effectiveness and quality. The company will also penetrate new markets and coordinate new product developments for symptoms the cold liquid does not cover (i.e. Allergy, Cough, etc.)

5. Marketing Programs and Tactics:

To effectively utilize AllRound’s’ marketing programs and tactics the company will apply the 5Cs (explained on page 3)

6. Financial Documents

6.1 Break Even Point-Assignment- Market Share Simulation:

Break-Even DataDescription $ (Millions)

Unit Volume 102.1

Unit Selling Price 3.49

Promotional Allowance 60.4

Cost of Goods Sold 122.6

Unit Variable Cost 1.79

Total Marketing Expenses 42.8

Fixed Costs 62.4

Unit Selling Price: (MSRP X 1- vol. disc %) [5.29 X (1 - 0.34)] = 3.49

Unit Variable Cost: (PA + COGS)/ Units [60.4 + 122.4/102.1]

Total Marketing Expenses: (Promo + Adv + Sales Force + Admin]

Company Break Even Units:

Fixed Costs)/ (SP per unit - Variable Cost per unit)

62.4/3.49 -1.79 = 36.70 AllRound is making Profit because this number is less than the unit volume

Marketing Budget Break-Even =

(Fixed Costs + Total Marketing Expense)/ (SP per unit - Variable Cost per unit)

62.4 + 42.8/(3.49 - 1.79)= 61.88 AllRound is making profits because the Units sold is more than the BEP

6.2 Advertisement and Promotion:

AllRound will promote their new products by utilizing various place strategies. The best way for AllRound to promote the new products is through Social Media, Causes and Charity and Point-of-Sale Promotion and End-Cap Marketing (basically the selling of a product or products and promoting items in stores).

= 87.66

6.3 Income Statement:

6.4 Percentage of Budget:

Estimates of the percentage of the budget is distributed directly to retailers and through wholesalers represent total industry sales of all five firms. As with all market research studies, some error is to be expected. These values often result from a survey or sampled information that is subject to some distortion.

7. Monitors and Controls

7.1 Sales Force Decision:

The direct sales force sells directly to retail channels. The indirect sales force engages in merchandising, supports wholesalers, and influences doctors and pharmacists. Sales force costs start at about $60,000 per sales person. Training costs are incurred for expanding the sales force as well as to train replacements for turnover.

8. Contingency Plans

8.1 Alternative Strategies:

Continue to only sale the AllRound 4 hour multi-symptom cold liquid. Penetrate one market at a time instead of three. (for example: only create a product for

Allergy symptoms and wait for results so the company can appropriately analyze the feedback.

8.2 Abandonment Points:

There are few reasons AllStar brands will abandon the objectives and those reasons are:

Sales a permanently declining New product did not effectively penetrate the market Customer feedback is bad

9. Executive Summary

9.1 Mission Statement: The Customer can count on us to professionally network functional pharmaceutical products to allow us to exceed customer expectations.

1. Philosophy, Values, & Ethics: The Company of AllRound has a philosophy that promises all of its customer’s medication at an affordable price while still working efficiently. The company values its customers greatly and appreciates customer feedback and satisfaction rate.

2. Business Domain: The Business Domain for AllRound is the Pharmaceutical Business.

3. Competitive Advantage: One of the many competitive advantages AllRound has is its affordable price, Brand Awareness and Brand Satisfaction.

4. Energizing Factor: There are many opportunities for AllRound to grow further into the pharmaceutical marketplace.

Objectives:

9.2 Marketing Objectives:

Increase Sales Improve New Product Awareness Maintain a Strong Brand Name Keep Loyal Customers While Gaining New Ones

9.3 Program Objectives:

Successfully penetrate new markets Maintain Brand Name Gain New Customers Increase Sales Improve all Product Awareness

9.4 Strategy:

AllRound is in the integrative growth simply because it is a growth strategy in which a company increases its sales and profits through backward, forward, or horizontal integration within its industry.

9.5 Outcome Expectations:

If everything goes according to plan, further penetrating the new markets of cold, allergy, and cough will be successful because the BEP and financial data support the hypothesis and AllRound has a strong brand name the customers recognize.