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Organisational overview
Strategic direction:
Houzit, the homeware chain of stores has 15 stores in Brisbane. Its main products
are bathroom & bedroom fittings, mirrors and decorative items. The strategic goal of Houzit is
to become a national brand in homeware. It aims to have a presence in all Australian cities by
2020, with total store count to become 100 from the present 15.
Organisational objectives:
In order to achieve this vision of become a nation-wide known retail store, Houzit
has put for itself certain strategic objectives. These include:
Presently the value of total sales is $15 million. The objective is to increase it to $20
million with in the next three years.
The number of customers who have loyalty membership is to be increased from the
present 10,000 to 15,000 members
Improve branding and customer awareness of the brand in Brisbane to the level that at
least 1 out 3 people recognize the brand in a random survey which would be conducted
in 18 months
SWOT Analysis
Opportunities Threats
•High growth market and less consumer •Competition from local independent
awareness retailers with cheaper products
•Increase sales in outer Brisbane •Compeition from national chains
•Economic recession
Gaps between the objectives and the current capabilities and resources:
While Houzit plans to increase brand awareness to high levels in Brisbane, its marketing
budget is presently less due to lack of critical mass and store cover
While it wants to increase customer loyalty membership, many target customers are still
not aware of Houzit
Similarly, for increasing the sales to $20 million, the gap in consumer awareness needs
to be decreased with superior marketing strategy and its implementation
Opportunities:
In order for Houzit to reach its strategic objectives, it has to focus mainly on its marketing
strategy. The main objective of the marketing strategy is to improve brand awareness as there
are still many in Brisbane who are unaware of Houzit brand even though it has 15 retail stores.
This increase in consumer brand awareness will automatically translate to more store visits and
more purchases improving the sales figures. Based on this analysis, there two marketing
strategies that Houzit could implement to improve brand awareness. These are:
1. Run TV advertisements about the brand in local television channels
2. Run a digital marketing campaign involving mail marketing, SEO, google AdWords etc.
1. TV advertisements:
Risks:
More and more people are consuming content through internet rather than from TVs.
The main target consumers for the company are people who are relatively young and
are looking to purchase or renovate their homes. These young people’s attitude towards
watching TV is changing. Especially people are spending less and less time watching local
TV stations.
Another problem is that there is high risk that a poorly crafted advertisement can lead
to developing negative attitude towards the brand. There is also a risk that a bland
advertisement that does not grab a viewer’s attention could be waste of expenditure.
The production of a video advertisement and broadcasting on TV is a comparatively
marketing strategy. Also, the marketing budget of Houzit is limited. Because of this
marketing strategy might not be sustainable and so there is a high risk of exhausting
marketing budget without achieving its target.
2. Digital marketing:
Risks:
Some of the customers are older people who are not as much online as the younger
people. Customers who shop at Houzit are well settled and hence the average age
would be rather high i.e more than 30 years of age. If these people are not online much,
with digital marketing alone it difficult to improve brand awareness about our
organization.
Digital marketing cannot be fully outsourced. This is because, digital marketing involves
a lot of content generation and changing of strategies dynamically. This requires active
engagement of the organization with the digital marketing consultant. Otherwise the
organization should maintain a separate division for running digital marketing campaign.
This could be cumbersome and also have to hire additional talent for this marketing
strategy
Another major risk is violation of user data privacy. The legislation about using the data
of a person to create targeted advertisements is getting solidified and courts are
considering citizen privacy as part of their natural rights. Hence, if not careful violation
of privacy rights could attract legislative penalties.
Wrong content: In the online world it is very easy to offend different sections of people
and there are people who are “trollers” i.e. they target a person or an organization
purposefully for annoy or defame them. If unfortunately, Houzit makes any mistake by
posting something a little offensive to any one, the trollers would pounce on it and
defame the organization. This increases brand awareness however, it forms negative
attitude towards the organization.
Picking the right strategy:
From the above discussion, we can say that going with a digital marketing strategy
would be best for Houzit to increase brand awareness. Reasons for this are:
With limited budget, it is better to pick a strategy that is sustainable. Digital marketing is
a sustainable strategy with the available marketing resources that Houzit has. Also,
digital marketing could be started with little resources and the strategy could be scaled
up when ever there are more resources and there is a need. Presently, the marketing is
being focused in Brisbane and later the target advertisements could be expanded to
target consumers nationwide.
The demographics of Australia suggests that the young population will continue to grow,
and that people of all ages are rapidly adapting to internet for their daily needs.
A consumer profile could be created, and advertisements could be targeted in a pin
point fashion to the consumers who match our consumer profile
Digital marketing is flexible, the strategies could be changed almost daily and we can
experiment till we find the right strategy that resonates with the people, unlike TV
advertisements which takes many days to create and costly to experiment with.
A marketing mix strategy typically has 4 P’s, which help an organization to market itself
or its products. The 4 P’s
Price: Houzitpriced its productscompetitively and value for money for its customers who
expect high quality products. However, one of the main differentiating factors for Houzit
is that it offers a very attractive long term easy to pay repayment plan.
Product: The main characteristics of the products on offer include high quality, unique
items that stand out from low-priced mass-produced items and having a large selection
of products from which to choose from. The main products the company sells include
bathroom fittings, bedroom fittings, mirrors, decorative items and lighting fixtures
Promotion: As identified earlier, the main marketing strategy would be to advertise
through digital marketing of its products and stores.
Place: Houzit sells all its products from its physical stores. It has 15 stores in Brisbane
and by 2020 it plans to setup 100 stores in all of the Australian cities.
Alignment of strategies with the strategic direction:With investing time and resources on digital
marketing, the brand awareness about the organization will certainly raise. This helps in
achieving the objective of being recognized by 1 in 3 Brisbane residents with in three years.
With increase in brand awareness the goal of improving sales to $20 million could be easily
achieved and finally the customer loyalty membership will also increase as the number of new
people who visit the stores increase.
By reviewing these metrics, we can understand whether our marketing strategies has led to
increase in brand awareness and improved sales.
Tactics
Tactics are necessary to make sure that the marketing strategies that we have applied
are implemented correctly.
Executive Summary:
Houzit is a chain of retail stores that sell homeware like bathroom and bedroom
fittings, mirrors and other decorative items. It has plans to become a nation-wide retail store
chain with presence in all major Australian cities by 2020. The strategic objectives for the next
three years of the organization include increasing the total sales from $15 to $20 million,
increasing customer loyalty membership list from 10,000 people to 15,000 and improve brand
awareness so that at least one out of three people in Brisbane are aware of Houzit. In order to
achieve these goals, efforts must be made to increase brand awareness among customers. This
requires good marketing strategies. Two marketing strategies have been identified and their
strengths and weaknesses were analyzed. Based on this analysis it has been decided to market
the stores through digital marketing. Tactics to implement this strategy have been decided and
KPIs for measuring the performance of these marketing tactics were laid down.
SWOT Analysis:
1. Strengths:
Highly skilled and knowledgeable employees
Great retail space with all amenities in great locations
High customer loyalty
Better products compared to competition
2. Weaknesses:
Limited marketing budget
Burden of maintaining long term payment plans of customers
3. Opportunities:
High growth market and less consumer awareness
Increase sales in outer Brisbane
4. Threats:
Competition from local independent retailers with cheaper products
Competition from national chains
Economic recession
Marketing objectives:
Increase sales from $15 million to $ 20 million in three years
Increase customer loyalty membership list from 10,000 to 15,000
Improve brand awareness among people of Brisbane where at least 33% of population
have heard about the company, with in the next 18 months
Strategies:
Two marketing strategies have been considered to achieve these objectives. One is
marketing through giving TV advertisements and the second is to utilize digital technologies to
do digital marketing of the stores. Reasons for selecting this strategy:
Houzit has a limited marketing budget and it is analyzed that digital marketing is
scalable and is more effective in targeting the right customer within limited budget
The trend of people searching for stores through google has been increasing and usage
of social media for information. reviews and complaints are also rising. This provides
great opportunity for Houzit to take advantage of this trend and meet customer
demand and expectations by having significant presence on google and other social
media platforms.
Online advertisement targeting has become very sophisticated as it helps in correctly
identifying the target customers and targeting them. This is a highly useful marketing
tactic as we are targeting only our potential customer.
Digital marketing is flexible and so its strategy and tactics could be modified based on
review of marketing performance and feedback more quickly
While TV advertisement is a high investment and high-risk marketing strategy, digital
marketing is a low investment and low risk strategy.
Price: The prices are moderately high as customers are expecting high quality products
with a lot of variety. Also, these products are not mass produced and hence the prices
are also premium. Although these prices are comparable to those of the competitors.
Products:based on customer preferences, the products are of high quality, unique and
provide a lot of choice
Promotion: The promotions are majorly done through digital media because of the
digital marketing strategy laid down and some promotions are also done through
magazines and in store promotions
Place:Presently the marketing activities are being concentrated to Brisbane and outer
Brisbane area and would be scaled gradually to other Australian cities
Implementation:
Create an attractive website that provides useful information about products and
locations, reviews, tips through blogging etc. This is the corner stone of the digital
marketing of Houzit stores
Use Google AdWords and AdSense network to give advertisements on different
websites
Promote the social media handles in facebook, Instagram and Pinterest
Use Search engine optimization (SEO), content blogging and generation of backlinks
from other websites to improve google ranking for the website, so that when users
search for buying homeware products in google, the website of Houzit should appear
among top search results
Promote inhouse promotions and discounts through digital media. Using coupon codes,
first time customers could be enticed to join the loyalty program of Houzit
The long-term digital marketing strategy is to create an e-commerce website for Houzit
through which products could be sold and home delivered
We have identified certain key performance indicators for the marketing strategy. By reviewing
these KPIs we can measure whether our marketing strategies are performing and whether we should
make any changes.