2016

MARKETING STRATEGY ASSIGNMENT

Soumik Nath
MBA II OPERATIONS
38281
9/10/2016
Realleader Fitness Co., Ltd, is a China-based fitness equipment manufacturer which integrates
development, design, production and sale. The company started off in 1996 and now it has branches
in Hong Kong, Taiwan and mainland China. It also has an R&D centre in the United States which is
dedicated to monitoring the development trend of international fitness equipment design.

After 11 years of operation, the company moved to its new plant, which covers an area of 20,000
square meters. Realleader not only has established long-term technical partnerships with many
sports specialists from America and the Netherlands, but also owns a group of professional fitness
consultants. Through concerted efforts of all the staff, Realleader has distributed its products to
more than 40 countries and regions, including Europe, America, Oceania, North Africa and the
Middle East, and become an important fitness equipment manufacturer perfectly integrating
appearance and performance.

Indian Fitness Equipment Industry

Market size of fitness slimming industry is 60 billion out of which equipment industry forms 20%
which amounts to 12 billion dollars. The market size is Rs 4500 Cr which is growing at a rate of 22%
to 27% annually.

There are two primary segments within the fitness equipment industry:

a) Home segment
I. Gym memberships are costly
II. People prefer exercising at their home than going to the gym due to paucity of time and
convenience

Following are the gym equipments which are mostly bought by the customers of the home segment

Equipment Price (in Rs.)

Minin Multi Gym 25,000 to 10,00,000
Exercise Bicycle 4000 to 40,000
Treadmills 35,000 to 1,50,000

b) Institutional Segment
I. Bulk equipment sold to health clubs/gyms and corporate houses
II. Equipments are more steadily built and expensive
III. Quality is the prime consideration and buyers are ready to pay a premium for better
quality and technologically superior products
IV. The institutional segment dominates the market at present

Equipment Price (in Rs.)

Plate loaded fitness equipments 26,000 to 4,50,000
Dumbbells and plates 14 / kg to 275 / kg
Treadmills 2,00,000 to 6,00,000
c) Other factors
I. Domestic manufacturers lack R&D facilities and compromise on quality to produce cheaper
products. Their products are almost half the price of the foreign player’s products.
II. 60 % of the fitness club market in India is composed of independent clubs, all of which
purchase their equipment through distributors.
III. Remaining 40 % is made up of chains, franchises, etc, some of which purchase from
distributors while others buy directly from the manufacturers of fitness equipment.

SWOT ANALYSIS

WEAKNESS:
STRENGTH: 1. Lack of Awareness about brand
1. 365 Million people between the age of 2.Small local players with cheap
10 to 24 equipments available in market
3. Irregular usage

SWOT
OPPORTUNITY:
1. Growing working age population THREAT:
2. Rise in health consciousness Low entry barrier
3. Increased per capita income

TARGET SEGMENT:

Due to high price in Home segment RealLeader Fitness equipment should target the actives and
believers. For both segments a good strategy would be to strengthen presence in Tier-1 cities
initially, after creating brand awareness among people they should move towards Tier- 2 cities

Individuals to target can be working class, MBA Students, businessmen, and other high income
groups (since price is a high consideration for individual users).

Touch points for such individuals can be: social media, e-mail, fitness centres, online portals
Institutions to target can be health clubs, recreation centres, corporate fitness, college and
universities, hospitality, online B2B portals, fitness tradeshows
 BUYER Competitive Supplier BARRIER TO THREAT OF
POWER Rivalry Power ENTRY SUBSTITUTES
•Many available •High due to well •Demand for •Low - foreign •Low
options established foreign brands operate
players equipment is in franchise
•Both in foreign rising model
and domestic •High supplier
brands Power

As institutional segment dominates the market at present and dependent on bulk buying of
instruments so Realleader should 1st focus on it then individual segment

The target audience being the individual users and institutions the marketing communications will
have to be developed accordingly.

MARKETING PRODUCT MIX

Product- The focus of RealLeader should be to ensure the quality of product, to adapt the product
according to Indian requirements surveys, questionnaires from gym trainers, test consumers to
know their requirements, likes/dislikes should be conducted.

Price- Since this is a more quality conscious segment price is a secondary factor in the marketing
strategy though prices competitiveness can be practices again by segmenting according to from
where the demand for specific products is raised. Place The distribution model to be chosen should
be importing and distributing via distributor. Such a strategy offers an immediate attractive ROI and
easy exit strategy.

Promotion Offline Strategy –

 Offer CPT Certification at discounted rates for bulk buying by health clubs, institutions
for their trainers
 Certified trainers in India are in scarcity. These trained professionals can then act as
influencers for the brand
 Conduct tradeshows, workshops for trainers to demonstrate their products and up
selling the certification offering
 Conduct strongmen/strongwomen competitions and use the events for lead generation
Online Strategy-
 Website Development-Keep UX such that the visitors can be shown clearly offerings
depending on the visitor profile like within the institutional segment the visitor can be a
university or a gym owner
 For building brand awareness start a blog for B2B customers advising them on tips related to
opening their gym, maintaining equipment, advice on how to select equipment While taking
the opportunity to promote its products. This should also be shared across its social media
channels
 Use proven B2B channels like email marketing, telemarketing to promote products
 Invite influencers/reviewers/celebrities to review products and share across their own
forums