New Product Launch Marketing Plan, Part 1

New Product Launch Marketing Plan

MKT 571

Abstract

Running a successful business can prove to be challenging. With advances and innovations in technology, today’s market can become competitive with new goods and services. With so many options available it can become difficult to choose the best product or service on the market to suit individual consumer needs, both domestically and internationally. The purpose of this paper is to create a marketing plan to launch a product or service domestically and internationally. The product launch plan will define and describe the product or service that will be offered. The plan will assess the market needs for the product or service, identify and describe the anticipated target audience, and defend the selected product or service. Finally, the plan will provide a brief SWOT analysis, analyze potential or existing competition, evaluate the potential growth rate, and give a 10 question survey instrument to be used to collect primary data about potential buyers.

Keywords: Market Plan, Needs, Growth, SWOT Analysis, Competition, Product, Service, International, Domestic, Survey, Air, Filtration System

New Product Launch Market

Air pollution has become a top environmental issue, domestically and internationally. According to World Health Organization (2016), “Air pollution is contamination of the indoor or outdoor environment by any chemical, physical or biological agent that modifies the natural characteristics of the atmosphere.” Air pollutants contribute to global warming and cause respiratory and other health problems that can lead to death. This problem is even more prevalent in developed and industrialized countries such as the US and Japan. This problem presents a great opportunity for major businesses and organizations to develop and market products that will help meet the clear air need of consumers on a global scale.

Define the Product or Service Being Offered

Our product is an eco-friendly home air filtration system targeting the US and Japanese markets. Both of these markets have areas of high air pollution especially in cities like Los Angeles, New York City, Chicago and Tokyo where there are large concentrations of people. Offering this product can help improve the air quality, reduce health risks associated with poor air quality, and increase the quality of life for consumers in both the domestic and international market.

Describe The Product or Service Offering

The product is a HEPA/ULPA air filtration with a pre-filter and a VOC (volatile organic compound) filter designed to remove the smallest particulate pollution, reduce the bacterial level and bad odors from the air. HEPA filters are designed to remove particles as small as 3 microns but do not deal with odors. ULPA filters are designed to remove particles as small as 12 microns. The pre-filter will remove the larger particles such as pet hair and lint to help the HEPA/ULPA filter work more efficiently. The VOC filter removes the VOCs from the air to reduce bad odors.

Assess the Market Needs for This Product or Service

Dirt, odor, mold, gasses and other toxic pollutants are all considered natural occurring contaminants. These contaminants are not easily avoided and are linked to things such as asthma, airborne diseases, and outbreaks like swine and bird flu. These issues help create a need in the market for eco-friendly air filtration systems both nationally and globally. According to Global Industries Analysts, Inc. (2016), there is an alarming rise in pollution levels and an urgent need to improve air which is driving the demand for air filter and filtration equipment. The information retrieved by a report from Global Industry Analysts, Inc. The market demand for air filtration systems is increasing because of consumer awareness of the effects of poor air quality. This demand for better air quality creates the need for this product in the market. An eco-friendly air filtration system will help consumers address their concerns in air quality and the environment.

Target Audience

Our company will be focusing on two unique target audiences, the U.S. domestic market and Japanese international. Although the markets vary in their demographics both markets, have consumers that the marketing industry refers to as LOHAS (lifestyles of health and sustainability) consumers.

In the U.S., research proves that consumers interested in “go green” products tend to be young adults, many of whom are influenced by their children. Women are also a key target for greener products, and often make purchases on behalf of men (Who are the green consumers? 2013). Consumers who “go green” are more likely have more money to spend. As a result, the most successful outlets for green products are retail stores frequented by high-end shoppers. These consumers have the education and intellectual orientation to appreciate the value of environmentally friendly products (Who are the green consumers?, 2013).

According to survey results by GfK Roper Consulting Green Gauge, seven in ten consumers in the U.S. say they know a lot or a fair amount about environmental issues and problems, and people with household incomes of $100,000 or more are more optimistic in addressing environmental issues (The Environment: Public Attitudes and Individual Behavior — A Twenty-Year Evolution, 2011). Therefore, our U.S. markets will focus its target audience primarily on women within the Generation Y category; a younger grouper of Americans approximately aged 18-31. Our target audience will also be college educated with disposable income that dwells in an urban area. This demographic area is more likely to be engaged in environmental issues and also more likely to have consumer habits influenced by peers.

Contrasting to U.S market research, the research of the Japanese market, the world’s second-largest consumer market, shows senior citizens (their primary population) demonstrate a commitment to energy efficiency, resource conservation, anda strong interest in new technologies to achieve greater environmental sustainability (2016 Top Markets Report Building Products and Sustainable Construction Country Case Study, 2016, p. 1). Surveys in the Japanese market have shown that 84% of the survey respondents preferred to buy environmentally friendly everyday consumer products, and 51% of Japanese consumers are more focused on the environment (Salsberg, 2010). Their senior market is also transitioning from non-energy efficient homes to the construction of houses and buildings with higher energy efficiency performance or improving the energy efficiency of existing houses and buildings (2016 Top Markets Report Building Products and Sustainable Construction Country Case Study, 2016). The senior market is also stated to have a high disposable income and willingness to pay high prices contrasting to recent McKinsey survey that showed only 16 percent of Japanese respondents expressed a willingness to pay a higher cost for quality products (Salsberg, 2010). Japanese consumers are rapidly changing their consumer habits and are now more willing to shop discount and online retailers.

A September 2009, MyVoice Internet survey found that 37 percent had cut overall spending, and another survey showed 50 percent of a representative sample of consumers across a range of age groups and geographies are now spending somewhat or significantly more time at home (Salsberg, 2010). When they are out shopping, they prefer malls and stand-alone specialty shops. This research has led us to choose a target audience of men and women LOHAS, focused in the age range of 50 and older, with a high disposable income who are empty nesters and still willing to pay high prices. The location demographics will include suburban, and urban areas as housing improvements are rapidly occurring in these areas.

Defend Your Choice of Product or Service

These filters are becoming necessary especially in areas of high air pollution to help protect the health of the people living in these areas. Air pollution is because of a heavy concentration of particulate matter in the air which can make breathing difficult especially in asthmatic people because these particulates can get into the lungs and block the oxygen absorption capacity of the lungs. Some of this particulate content can also be bacterial or viral in nature which can cause diseases in the lungs or other portions of the body. By removing these particulates, we can lower the risk of disease and breathing problems. By doing this, we can greatly improve the quality of life for people.

SWOT Analysis

Strengths

Satisfying the needs and demands of people who need filtered air.

Satisfying customer’s awareness for economy friendly air treatment.

The study shows that is a high demand both in the U.S. and in Japan.

The cost of production low.

Big sale volumes for a low price.

Strong customer relationships.

Strong internal communications systems.

Strong geographical location with high traffic.

Well designed and successful marketing strategies.

The business reputation of being innovative.

Weaknesses

Competition has an advantage on time in the market.

Competition has exclusive endorsements and distribution with certain client’s weakling position or future sales.

Many customers are looking to go green (Target audience).

Too much stock in inventory (costs).

Outdated market research data.

Opportunities

United States demand for consumer air treatment system will rise 5.5 percent annually to $2.3 billion in 2019.

To produce the first HEPA/ULPA air filtration with a pre-filter and volatile organic compound filter, (Helping people removing air pollution that causes illness).

Having a filter that can remove VOCs along with reducing bad orders.

Products similar to yours in the market are expensive e or poor quality.

Customers in the market are loyal.

Seasonal high demand of the product.

High demand for the product.

Threats

Lot of competitors in the market

New advertising campaign by competitors

Downturn in economy and less spending

Analyze Potential or Existing Competition

The IBISWorld put out a report of what the air purification market is doing. This research report provides the latest industry statistics and industry trends. In the Industry Report, the results show that there was no single company accounting for more than 5.0% of industry revenue (IBISWorld, 2016). Establishments in this industry primarily manufacture stationary air purification equipment. The devices that these industries are manufacturing are not close to having a HEPA/ULPA filtering system.

There may be potential competition in the future with the rise of focusing on pollutions and how it affects people’s health. Within the next four to five years the growth of this market will be at 873.9 Million USD by 2020 (MarketsandMarkets, 2016).

The biggest threat or competition would be China. China is one of the fastest growing markets for HVAC air filters in the world. China drives this competition mainly by having a growth in industrial applications and regulations for air quality (Business Wire, 2016).

Evaluate the Potential Growth Rate

According to Freedoniagroup (n.d.), “US demand for consumer air treatment systems will rise 5.5 percent annually to $2.3 billion in 2019. Whole-house systems will be the fastest growing”. This is a strong growth rate in the U.S. market, and the Japanese market should grow at the same or higher rate. This study analyzes the $1.8 billion US consumer market air treatment systems. It presents historical demand data (2004, 2009 and 2014) and forecasts (2019 and 2024) by technology (e.g., ion exchange, electrostatic, ionic), product (e.g., whole house and portable air treatment systems, consumables), and US region.

10-Question Survey

1. What is your age?

2. Where do you live?

3. What is your household size?

4. What is your education level?

5. What is your annual household income?

6. Does anyone in your household have a respiratory issue or disease?

7. Are you satisfied with the quality of air your breath in each day?

8. Are you interested in a new product that helps filter and produces clean safe air?

9. Do you currently purchase eco-friendly products?

10. What is your typical buying budget?

Conclusion

Our research has shown that there is a market need for an eco-friendly air filtration system. Through assessing the need, we have concluded there is an opportunity in launching this new product to our chosen target audience, the US, and Japanese market. However, our SWOT analysis shows that there are still obstacles to overcome, such as potential threats from competitors, the cost of production, and less economy spending. More consumer research will need to be conducted to move forward with the product launch.

References

2016 Top Markets Report Building Products and Sustainable Construction Country Case Study. (2016). Retrieved from International Trade Administration: http://trade.gov/topmarkets/pdf/Building_Products_Japan.pdf

Business Wire, A Bershire Hathaway Company, retrieved from sitehttp://www.businesswire.com/news/home/20160210005821/en/Chinese-HVAC- Filter-Market-2016-2020—High  

Freedonia. (n.d.). Consumer Water & Air Treatment Systems. Retrieved from

http://www.freedoniagroup.com/Consumer-Water-And-Air-Treatment-Systems.html

http://www.strategyr.com/PressMCP-2560.asp

IBISWorld, where knowledge is power, 2016, retrieved from website:

http://www.ibisworld.com/industry/air-purification-equipment-manufacturing.html

MarketsandMarkets, Air filters Market worth 873.9 Million USD by 2020, 2016 retrieved from

Website: http://www.marketsandmarkets.com/PressReleases/automotive-air-filters.asp

Salsberg, B. (2010, March). The New Japanese Consumer. Retrieved from McKinsey and Company: http://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/the-new-japanese-consumer

The Environment: Public Attitudes and Individual Behavior — A Twenty-Year Evolution. (2011). Retrieved from SC Johnson: http://www.scjohnson.com/Libraries/Download_Documents/SCJ_and_GfK_Roper_Green_Gauge.sflb.ashx

Who are the green consumers? (2013). Retrieved from International Institue of Sustainability Development: https://www.iisd.org/business/markets/green_who.aspx

World Health Organization. (2016). Air Pollution. Retrieved from

http://www.who.int/topics/air_pollution/en/