1 Introduction
The context of growth and development is not alien in the context of the organization. For organizations to survive in their respective markets, they will have to constantly pursue these elements. The moment that strike a balance on what the market needs and what they can offer, then it is at that precise moment that one can say that they are a successful organisation. This supposition is rather universal in its application. It applies in every organisation regardless of the market or the industry where they are operating. However, a large part of the operations of these organisations tend to result from the marketing strategies employed by the organisation. For instance, the study of Drejer (2002) maintained that such operations require the need to be aware of the external environment so as to develop some form of foresight in the process. It is this foresight that allows the company the capacity acquire some level of flexibility. For this paper, the respondent company shall be Stobo Castle Health Club, one of the top health spas in Scotland. There has been a dearth of studies focusing on these health spas and other health clinics in the world despite the growing industry. Possibly this is triggered by the size of each companies that operate in this industry. Stobo Castle Health Club is located in the off skirts of Scotland with specific amenities of the utmost quality. In the same regard, the company is placed in a Scottish castle, perched a top of a hill with a picturesque image of vegetation and lush greenery that will inevitably draw in the core customers of the company. The following discussions shall describe the existing capacities of the company and how they may use it for their expansion process.
2 Marketing Audit
In order for Stobo to gain and sustain competence in the market, the company need to implement a market planning process. The first step in the process is the conduct of a marketing audit. It presents the basic foundations of the development process and the actual action plans to realise these objectives. In this context, the audit provides for the internal and external influences that may have an effect of the market planning process. The following discussions shall provide an analysis of the Stobo environment, both internal and external.
2.1 Internal Marketing Environment of Stobo Castle
In the case of the internal marketing environment, Stobo should consider several elements in their internal operations. For instance, they have to recognise the labour needed to address the overall plan. Based on the case study, the ratio of staff to guest is 1:1. It also indicated that overall, there are 160 employees in the company. On the part of the finances, the company is doing fairly well. In the previous year of its operations, the case study indicated that the turnover was approximately five million pounds. In the case of the necessary equipment, Stobo Castle Health Club is highly capable of supporting any expansion activity. For instance, the case study mentioned that at least twelve additional bedrooms were erected as a part of the expansion process. In this case, the company y claims that they require more skilled labour to accommodate the expansion. The problem in this regard is that the market for beauticians and skilled spa personnel is considerably intense as there is a growing industry of spa clinics all over Europe.
2.2 SWOT Analysis
The following discussions shall provide an analysis of the microenvironment and microenvironment components Stobo Castle. This shall be completed upon the discussion of the strengths, weaknesses, opportunities and threats to the operations of the company.
2.2.1 Strengths
Stobo Castle is renowned for its service in all of Europe. As the case study expressly indicated, there are big names that frequent their Scottish Castle for a weekend of relaxation and beauty. Not only this, it appears that the services offered by company as well as the rates of the rooms were considerably affordable. This is implied by the one thousand five hundred pound splurge of Dame Shirley Bassey gave her five rooms and a tumultuous amount of treatments. That is fairly reasonable for a hen weekend in the Stobo Castle. Added to this strength is the capable number of labour in the company. The case indicated that the ratio of staff to clients is 1:1 which affords the best possible provision of service in the market. This adds up to the ambiance provided by the lush greenery and the privileged atmosphere provided by the Scottish Castle. Overall, the reputation of the company, with the pool of glamorous clients, gives them the edge over the rest of the players in the industry.
2.2.2 Weaknesses
One of the apparent weaknesses of the company is its location. Those that would want to acquire their services would have to endure a long drive. Hence, accessibility is a major problem. In the same regard, the marketing practices of the company have yet to manifest good results. Basically, this may be because of the image of Stobo Castle which basically shows an aristocratic flair, hence the buying public may find it less appealing and perceive it as expensive. All in all, the lack of marketing prowess may well be the biggest weakness of the company as they depend highly on their reputation to get hold of customers.
2.2.3 Opportunities
Advertising has become increasingly convenient for companies with the emergence of the internet. The website of Stobo Castle is a step towards increasing their market share. In the same regard, the site also provides the public the information they need so as to avail for promotional packages and other special promotions that the company could use in their quest to attract multitude of clients.
In the same regard, they can use these technologies, particularly web-based technologies, to improve their value chain. This means that in increasing efficiency in their inbound logistics and outbound logistics, the Stobo Castle would be able to lessen the costs of their operations and find more ways of acquiring profit for their company.
2.2.4 Threat
The apparent threat in the operations of the company is seen in its primary strength. Basically, it is mentioned that the company has a 1:1 ratio of client to staff. This means that if the company failed to come up with the appropriate rate of return, the company will incur a huge loss. Plain and simple, there is an inherent threat for the company to lose money as they have a huge overhead rate. This means that they have a lot of employees and it would be unlikely that their 160-strong staff would constantly cater to 160 clients each and every day. Another threat is the impending recessions that many economic titans are experiencing; these do have an effect not only in the financial spending of the core customers of the company, this also spell a different perception on the demand of such services. Basically, the spa services rendered by the company are essentially classified as a luxury. Hence, it is expected that when such financial troubles do give the consumers a worry, then it is anticipated that visiting the spa would be among those last in their lists.
2.3 External Marketing Environment of Stobo Castle
The external environment primarily points to the customer of the organisation. More specifically, it is the aspect of the operations that looks at the decision process of the core customers as well as the consumer behaviour. The external environment of the organisation provides for the determination of the nature of the competition of the company’s target markets. Specifically, it looks at the level of profitability manifested by its competitors. It points to the intensity of competition in the market. Other elements such as the culture and the demographic profile of the employees are taken into consideration. All in all, it provides an image on how appealing is particular a market. It also indicates the adjustments that a particular organisation should undertake so as to establish a fit with the existing environment. To do this, it is important for the individual company to institute a market research to deal with the necessary information on how to utilise these to the company’s advantage.
2.4 Porter’s Five Forces Model
The five forces analysis assists the company to particularly define a competitive environment. To some extent, this evaluation tool also uses certain items that are analysed in other tools such as PESTLE analysis. Basically, these are tools that the company could use in conducting an environmental audit. It identifies several competitive forces that have a great influence on the industry and every type of market. The said forces indicate the overall intensity of competition. This then presents the actual profitability and attractiveness of the industry. In determining these items in the environment, it would help the company to change these actual competitive forces and consequently work to the advantage of the company.
2.4.1 Threat of New Entrants
The presence of new entrants significantly influences the equilibrium of the competition in the industry. To this end, there are certain industries where significant barriers may impede the entry of new players. In the context of legal barriers, the entry in the market of the spa and health clinic is rather manageable. In the same regard, the costs of instituting a particular health spa are considerably inexpensive. This is the same with the actual operations of the said types of companies provided that it is not mismanaged.
2.4.2 Bargaining Power of Buyers
There a two considerations in determining the bargaining power of the buyers in the industry. First to consider is whether or not there is a good number of customers present in the market. In the case of Stobo Castle, the operations of the company are rather limited to the spot where they are located. However, they are recognised in the market as a destination spot for weekends. This means that the company still caters to a good number of customers, both male and female. It must be pointed out though that the location of Stobo Castle limits their customers to those who can afford to travel to and from the said location, particularly those who have their own vehicles. Another element to consider is the switching costs that the buyers may incur. To this end, the switching costs would be rather low as there are spa establishments that has emerged in the city areas. This may indicate less cost in travel and possibly lesser charges in the services of these city establishments.
2.4.3 Bargaining Power of Suppliers
As opposed to the context of the power of the buyers, the suppliers in the Spa and Health Clinic industry, the suppliers do not have the same power to wield on the major players. Basically, the products used in the said establishments are able to be readily replaced. A particular company can shift from one supplier to the next without regard of the costs. This is because the products provided by the suppliers in the industry are rather indistinguishable and interchangeable. The customers of the said industry places only high regard on the actual service provided by the companies and less on the actual products that they use. In the same manner, there are companies in the industry that even manufacture their own individual products making them a direct competitor of the suppliers in the Spa Industry.
2.4.4 Threat of Substitute Products
Another element in the industry that affects the equilibrium of the competition is the emergence of substitute products. Substitute products are created by companies in a different industry that offer products or even services that seems to please the existing demands of another company’s target market. In the spa industry, a clear industry that provide for substitute services are those salons and barbershops. Traditionally, these establishments focus primarily on cutting hair and developing the hairstyles of their clients. However, recent trends toward the provision other services like facials and massages has given the public an alternative, or even a cheaper option, to going to spas and health clinics.
2.4.5 Intensity of Rivalry
In this component of the model, what is considered here is the dynamism of the competition. In this case, the spa industry appears to have a highly intense competition. The services in this industry are rather interchangeable and indistinguishable. Hence, there are companies in the industry that uses marketing strategies like differentiation and cost leadership. This is compounded by the presence of substitute products. Moreover, the inherent economical feature of these substitute tend to endanger the standing of companies in the market. All in all, companies will considerably have difficulty in controlling the market because the buyers have a considerably strong influence on their operations. This means that the companies will essentially exit the industry if they lose a considerable amount of market share.
3 Existing Marketing Strategies
The Stobo Castle implements a couple of marketing strategies. These include cost leadership and product differentiation. As stated in the earlier parts of this study, the products and services rendered are highly interchangeable and indistinguishable. This is the reason that Stobo Castle implements the cost leadership strategy. Specifically, this points to the reduction of costs and provision of highly competitive prices in the market. Being an older company in the market, the experiences incurred by the company helps them in addressing the demands of the market.
Another strategy the company is implementing is geared towards satisfying the needs of the public. The focus in this regard is the behaviour of the customers. In the case of Stobo Castle, they differentiated themselves from the rest of the players in the industry by providing not only a set of affordable services but an entire experience. Given that they are situated atop of a hill and within a castle, they have given the spa industry a different model to follow as they imposed the image of being a tourist destination.
4 Marketing Research Plan
The research plan intends to establish as to plan to market the expansion intentions of Stobo Castle. This is because of the intention of the company to expand its guest capacity to over 17,000 a year. Specifically, the company is seeking ways to develop their B2B and B2C operations in the market. This action will essentially expand their scope in the market.
4.1 Research Objectives and Potential Problems
In the actual research of the market, the following questions shall be answered fully so as to realise the major objectives of the organisation.
4.2 Research Brief
The aim of the research is to establish Stobo Castle as the premiere spa destination of the UK. This shall be done by diversifying its major consumers. The company shall now expand from B2B to B2C. This means that the focus of the company will shift from its individual clients to companies as a whole. Basically, this is done by striking a deal with companies in UK to acquire the services of Stobo Castle to provide as perks or even incentive packages for their employees and executives. In this regard, a new line of core consumers shall be established in the form of these juridical persons. However, this does not mean that the company will be neglecting the existing core clients that have made the company what it is today. These individuals shall form part of the entire family of Stobo Castle.
5 Research Methodology
In conducting the research, the company shall use both primary and secondary data.
5.1 Primary data
The primary data shall come from a survey made by the company to a particular set of individuals as well as a number of companies. The respondents shall answer a questionnaire that will measure the level of their predilection towards certain services offered by the company.
5.2 Secondary data
The secondary data shall be acquired from scholarly materials and academic journals that pertain to the Spa industry and how the consumers behave on certain demand curves. Moreover, the company shall also use books, magazines as well as other periodicals to determine the trend in the environment. In the same manner, the company shall also be using the internet to acquire the secondary data needed.
6 Sales and Marketing Plan
The sales marketing plan shall continue the existing marketing strategies employed by the company. However, there is a considerable shift with reference to the mission statement, the marketing tools used, and the promotional strategies that the company will employ.
6.1 Mission, Vision and Strategies
The company’s mission is “to provide the public world class service and guarantee customer satisfaction at the most reasonable prices.” On the other hand, the company also intends to carry out the following objectives”
6.2 Marketing Tools Used
The primary marketing tools that the company shall use shall include print, television and radio advertising. The company shall submit a particular spiel that these forms media shall read to the public. On the other hand, the company shall use brochures and direct mail and send it to prospective companies and individual clients. To cope with the increasing pace of technology, the company shall also use the internet, particularly its website, to accommodate reservations and queries on the services provided for by the company.
Credit:ivythesis.typepad.com
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