Chapter 11What Would You Do? 1. If you were starting a soap business (laundry so

Question

Chapter 11What Would You Do?

1. If you were starting a soap business (laundry soap), what strategy would you use to compete with Procter & Gamble and Clorox ? How would you reach your target market? How and where would you advertise? We talk about the power of word of mouth-how do you use it to your advantage as a small business marketer?

2. One of the the biggest challenges the business faced was getting its products on the shelves of grocery stores. By 1999, they were in 2,500 stores from California to Florida, and the company had revenues of $5 million. How would you create such market penetration?

Explanation / Answer

Soap business and marketing strategies

When start a business the firm must select best business strategy. This strategy must be provide a comptitive adventage to the business. The competitive adventage in the form of minimisation of cost and maximisation of revenue. So the selected strategy must be contribute to protect the competition from the existing firms. Here the business firm Procter and Gamble and clorox are biggest producer Laundry soap. They have their own strategy to compete the existing market. Because they have their own market segments.

So in this a new business especially laundry soap we compete biggest firm. So we want to select best business strategy. I think we used the marketing strategy of focused cost leader ship strategy. This is the business strategy to focused on a small market segment to lower the cost of production. When we want to reduce cost first we understood the customer needs. Most of customer buy low cost product. So we must reduce the selling price by reducing the cost of production.

To implement this strategy by concentrate on specific geographic region and less comptitive area. This will create best implementation of focused strategy. On the basis of this we must target the focused customers.

When we adopt a strategy the supplier must be have the ability of bargaining to the customer. So must produce high quality product with lowest cost. This will help the business more successful.

Power of word of mouth strategy

This is the new strategy of the small business firm. Every people have like to talk. So the small business firm enter more concentrated on this strategy. This will create sharing of opinions, advice,etc.. This is the best advertising than anyother advertising. The firm owner tell about the quality of the product to the neighbours and so on. It is easily spread all over the country. Most of the people like the advice of family and friends. So this strategy is the best method of ongoing small businesses.

2. Market penetration

We know that market penetration means that expanding market share from the existing products. This will create the product diffrentation. So the only adventages of grocery stores is the convienience of the product in the market.

The disadventages are:

1. More expensive than real cost of the product

2. It will negatively affect retail network of the country

3. This will drainout the local economys money.

4. Lead to large exploitation to the consumers.

5.

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