Lazy Days Strategic marketing plan

Internal analysis Company analysis

Financial analysis – ratio analysis

0

5

10

15

20

25

1992 1993 1994 1995

%

year

Financial A nalysis

GP M a rg in

N P M a rg in

Tu rn o ve r g ro w th

Vo lu m e g row th

1992 1993 1994 1995

GP Margin % 16 15 13 11

NP Margin % 3 2.9 2.1 1.8

% Growth in Turnover 20 11.11 10

% Growth in Volume 18.8 6.1 9.1

•NP Margin – Declining 

•Growth Rate in terms of volume –  declining ••

COMPANY ANALYSIS

Financial analysis – customer analysis1992 1993 1994 1995

Volume 69,000 82,000 87,000 95,000

GP per customer

£ 34.80 £ 32.90 £ 29.90 £ 25.50

NP per customer

£ 6.52 £ 6.46 £ 4.83 £ 4.1

Turnover per customer

£ 217.4 £ 219.5 £ 229.9 £ 231.6

•Volume and T/O per customer rise, but NP,GP per customer decline. (as no Operating costs are included in those figures)••GP per customer figures are more accurate than the NP per holiday maker calculations; asNP includes other expenses such as income tax, finance costs and other general admin costs, that are not directly attributable to the holiday makers.

••

COMPANY ANALYSIS

Financial analysis – customer analysis(snap shot)

0

50

100

150

200

250

1992 1993 1994 1995

ye a r

valu

e pe

r cu

stom

er GP per customer

NP per customer

Turnover percustomer

COMPANY ANALYSIS

Value chain analysis for SCA

Infrastructure Web based infrastructure

HR Management• Training aimed at customer satisfaction and service quality• Change management

Technology• ( - )MKIS on line reservation system and customer DB• CRM system

Procurement• Value added services• Cost reduction methods

Inbound logistics

Strategic alliance with, Airlines hotels

and resorts

Operations Customized

products in premium prices

Outbound logistics

Internet and web based to

eliminate intermediary cost

& Sales Marketing Aggressive sales of

, packages and building loyalty programs

Services Creating CLV through

relationship marketing and -continuous follow

ups

Margi

nM

argin

COMPANY ANALYSIS

Customer analysis

Segmentation Grid

Age < 25 - 25 37 - 38 60

– Socio economic Class A B & C1 C2

Benefit Sought VFM Customized Experience

(Frequency per Year) High Medium Low

Lifestyle Part of Life Occasional Once in a lifetime

Number of HolidayMakers

Individual Couple / Family Group

Type of Holiday Adventure Relaxed Tour based

Product Offering Safari Beach Golfing

Skiing Ballooning Eco

The current customer profileCUSTOMER ANALYSIS

Customer Profiling

Target Audience Characteristics of Target Audience

Innovators – , , , , 25 37 A Customized High Frequency Holiday as , / / , Part of Life Individuals and or Family Group

/ Ballooning Safari

Relaxation Seekers - , & , , , 38 60 C1 C2 VFM Low Frequency Holiday as – , , , once in a life time Couple Relaxed Beach

Occasional Travelers - , , , , 25 37 B Experience Medium Frequency , / / Occasional Holiday Individuals and or Family

, Group Tour based , / Ballooning Safari

CUSTOMER ANALYSIS

Factors to consider Segmentation

Factors Segmentation Type

Innovators Relaxation Seekers

Occasional Travelers

Potential Growth High Low Medium

Cash Flow High Low to Medium Medium

ROI Less period toRecover

Slow Recovery Somewhat less period to recover

Brand Equity High Low Medium to High

Communication Budget High Low Medium

CUSTOMER ANALYSIS

Targeting

Age < 25 - 25 37 - 38 60

– Socio economicClass

A B & C1 C2

Benefit Sought VFM Customized Experience

(Frequency per Year) High Medium Low

Lifestyle Part of Life Occasional Once in a life time

Number of HolidayMakers

Individual Couple / Family Group

Type of Holiday Adventure Relaxed Tour based

Product Offering Safari Beach Golfing

Skiing Ballooning Eco

Innovators  Innovators + Occasional Travelers

Occasional Travelers Relaxation Seekers

Lazy Days - Positioning

Generic

- Semicustomize

d

Customized

Servicecustomization

Local Regional Global

Serviceoffering

CurrentPosition

DesiredPosition

CUSTOMER ANALYSIS

External analysisMarket analysis

Porter’s Five Forces Analysis

MARKET ANALYSIS

Porter’s Five Forces Analysis Bargaining Power of Customers – HIGHü Several options available to customers within the leisure industryü Easy access to information - Internetü Tightening discretionary spendü Customers are asking for more for less priceü Low switching costü•

Bargaining Power of Suppliers – MEDIUM to HIGHü Suppliers – hotel resorts, airlines, travel agents, caterers etc.ü Reduced dependence on intermediaries – shift to direct

distributionü Destinations are demandingü Airlines packagingü Price competition among the suppliers•

• •

•

•

MARKET ANALYSIS

Porter’s Five Forces Analysis Threat of New Entrants – HIGH ü Commoditization ü Low entry costü Availability of New Markets ( N. America, Asia etc.) ü•

Threat of Substitutes – MEDIUMü Substitutes constitute anything that competes for consumers’ “share

of wallet” E.g. – Purchasing a TV, going on a local holiday within Europe etc

ü Switching to other house way goodsü Customer goes directly to the hotelü

Inter Industry Rivalry – HIGHü All the above factors contribute to strong rivalry within the leisure

industry as firms compete to maintain market share•

MARKET ANALYSIS

Competitor profiling

MARKET ANALYSIS

Customer focus 

Ran

ge o

f hol

iday

 pac

kag e

s 

High  Low 

Lim

ited

 W

ide

Lazy Days Holidays 

Travel Leisure's (pvt) ltd

Global Holidays

Competitor analysis

MARKET ANALYSIS

Strategic options and objectives

Objectives for sca

Corporate objectiveTurn over increase by 50% by next 3 years   

Marketing objectiveMarket share increase by 45% by next 3 years

Customer life time value increase by 45% (CRM) 

Marketing functions IMC – to increase awareness level internally and adapt to change to 

strategyAggressive sales strategy to market new packages.

STRATEGIC OPTIONS AND OBJECTIVES 

Price Differentiation Focus Differentiation

Product Differentiation Customer Service Differentiation

Differentiation strategy

Product Offering Differentiation ü

Lazy days will focus on Product Differentiation as its business strategy to establish the competitive over their competitors.

ü

Lazy Days to achieve its Product Differentiation by ;ü

üQuality Packages– creating a package and service that is exceptional in one or more ways. Examples: Safer Ballooning and Safari Packages, Additional Costal guards at beach packages. 

ü

üFirst Mover advantage­ being the first one to offer Ballooning package for newly married couples in Africa. 

ü

üFeatures/Options ­ offer lots of choices, unusual combinations ( Example Safari + Ballooning, Safari + Golfing , Ticket only, Hotel +Ticket etc. )

ü

üCustomization – Tailor­made packages 

Differentiation strategy

Multiple Niching

•“[A] firm should `stick to its niching’ but not necessarily to its niche. That is why multiple niching is preferable to single niching. By developing strength in two or more niches the company increases its chances for survival.”

• Philip Kotler

üLazy days to adopt Market­Nicher Strategy to compete against it’s competitions establish the competitive over their competitors.

üAs Lazy Days will be attacked by larger firms once they notice the niches are successful, Lazy Days to focus on MULTIPLE NICHING  STRATEGY.

COMPETITIVE STRATEGY 

Strategic option analysis – Ansoff’s matrix

STRATEGIC OPTIONS AND OBJECTIVES 

Market Penetration1.      Increase usership  for golfing in African destinations by 20% through

••Specialized  safari packages for selected travelers in Social groups C1 & C2•Golfing loyalty club membership•Golfing fiesta package for women

  2Increase usage for skiing in Eastern European destinations by 30% through

•Market skimming pricing for  mass crowd•Promote skiing packages for both peak & off peak seasons

 

Market Development 1.      Exploring new market segments in most profitable African destinations

• Targeting only Social groups A & B for specialized product offerings ( Innovators, Relaxation seekers, Occasional travelers)• Favorable money making destinations will be carefully selected for these packaged holidays , E.g :Congo,  Cape town•This would be our key target segment which gives us the maximum amount of revenue & returns•Priority would be given to continuously develop key markets in Africa which in turn brings us this purpose, this would be done through our research team which is responsible for selecting profitable market & segments•The selected target Audience or key customers are likely to be under scrutiny for next  three years   based on their returns to our business goals, thus this makes easy for evaluation of the new segment

 

Strategic option analysis – Ansoff’s matrix

STRATEGIC OPTIONS AND OBJECTIVES 

New Product Development 

New product packages are carefully made which suits to the selected social groups A & B, this would include­ Wild safari Package in African jungles­ Hot  ballooning package in blue sky­ These two special product offerings would be coupled with many other supportive value added services such as  : Hotel stay , Air fare, Concierge services, Boutique night out­  The above packages are rolled out to innovators, relaxation seekers & Occasional travelers for whole year­  Based on the incremental value of each individual in these segments, they would be entitled to a further  new product package which exclusively available after 1 year of operation­  That would be the exclusive VVIP Afro  package given out to high value makers­  This includes the benefits of:  Hot  chocolate ladies club in Africa, Meet my princess offer &  many more

 

Diversification

Right now we are not considering any sort of interest for diversification, but based on the business performance in the next three years the following options are available : 

­ consulting company in tourism & leisure­ Destination marketing organization

Swot analysis•Strengths

• Hall of experience & familiarity in current market

• Company has pricing advantages & can survive in the tag of price war. (Pricing policy is below 5-8% industry rates)

••Opportunities

• High spending power amongst socio eco A&B

• Attractiveness of African mkt and potential for earning capacity

• Comparatively less competition within Africa for leisure and tourism industry

• Admin cost is relatively low compared to European destinations

• Absence of rigid government policies , political red tapes & high taxation for mkt entry

• Super profit making destination with first mover advantage for particular product offerings

•

•

• 

•

We akne sse s•Lack o f customer DB. Competitor 

intelligence & customer loyalty •Poor communication methods in the 

absence of appealing mkting campaigns 

•Complicated product o fferings & packaging not suiting the TG 

•High overheads•No technology advancement•Adaptation of conventional thinking 

amongst Lazy Days instead of  customer driven culture. 

•

Thre ats•Unpredictable  recessionary environment 

can completely shadow off the  incomers.

•Rising numbers of pressure  groups for environmental protection  and independence.

•The degree o f duplication might be very high in Europe  destinations with similar types o f product o fferings. 

Building sustainable competitive advantage

Way you compete•

• Product Strategy• Generic product offering (mass packages) and customization to suit

personal requirements.• - Wild life safaris ( generic and customized safaris ) • - Honeymoon Packages (Customized & generic – safari/ Ballooning

/Golfing) • - Tailor made tours for individuals and group • - Ballooning in Africa• - Family holidays • - Adventure holidays ( Skiing / Ballooning/ Safari )•

• Pricing Strategy• - Competitive pricing for the generic offering (mass packages)• - A comparatively higher price for the customized packages depending

on the customer requirements• • Re-positioning Strategy • - integrated marketing communications (IMC) • Message : “plan and design holiday packages to those who wish to

explore and discover the natural bounties”

•

• Distribution Strategy• - No intermediaries , web based & direct marketing • - Priority focus on reaching the customer – online and offline

•

•

•

•

•

•

•

•

People Strategy• -Train staff on service quality, relationship marketing, ,

competitor profiling, collecting market information, etc…• - self resourced team to develop the website ( this avoids

outsourcing expenses) •

Process Strategy• - MKIS & CRM systems, knowledge management, intranet

systems• - Development of e-distribution systems•

Physical Evidence• - Consistent branding in staff dress, market oriented office

environment, brochures, tickets , travel guides, travel insurance and other tangibles

•

BUILDING SUSTAINABLE COMPETITIVE ADVANTAGE 

On-line Off-line

Official web site Alliance web site web ad’s (Airlines, hotels/resorts and banks)

- In-flight magazines - 24*7 customer service •Customer friendly office – providing personalized services to meet customer requirements.E.g: coffee for all customers.•Bank offers : corporate packages , card holder offers (platinum and gold card holders)

Basis of competition

Providing competitive service by streamlining & synchronizing the upstream & downstream value chains

Use of a balanced portfolio to offer a balanced product range

BUILDING SUSTAINABLE COMPETITIVE ADVANTAGE 

Leisure and travel industry

Global Holiday Travels –UK Whole World Golf Travel Safaris Direct (http://www.safaris-direct.net) Golfing in Africa – (www.golfingafrica.com) Balloon Safaris – (www.balloonsafaris.com) www.lastminute.com

WHERE WE COMPETE 

BUILDING SUSTAINABLE COMPETITIVE ADVANTAGE 

WHO WE COMPETE AGAINST 

STRATEGY 

­Market Development

­Branding

­Differentiation SKILLS

­Knowledge management

­communication

­IT

STAFF

­T&D

­Employee satisfaction

­Motivation

­Rewards

SYSTEM

­Customer database

­MKIS

­Intranet/Extranet

STYLE

­Supportive style leadership

­Action centered leadership

STRUCTURE

­Virtual Organization

­Flexible

­Bottom­up approach SHARED VALUES

­Innovation

­Integrity

­Quality

­Openness

ACHIEVING SUSTAINABLE COMPETITIVE ADVANTAGE 

IMPLEMENTATION & CONTROL

IMPLEMENTATION & CONTROL

BALANCE SCORE CARD 

VISION 

Financial

-% profitability for SBU-Economic value added-Market share (as a web dealer) 

Internal process

-# of customer complaints-Time taken to upload the site and errors-% time site down ( during peak holiday seasons )-

Innovation & Learning

-# of new additions to the site-# of site links-# of language translations-# of training hours per employee -

ExternalInternal

Past

Present

Future

Customer perspective

-# of customers -Customer satisfaction (VFM, Range of offers, service of the employee) -Customer retention ( Loyalty cards, blue tooth) -Average value per customer -Customer acquisition -

BALANCE SCORE CARD – MEASUREMENTS  Perspective Objective Measurement Targets

96 97 98

Financial Revenue Growth Increased mkt shareEconomic value added

% change in revenue % increase in mkt share

50%45%

50%45%

50%45%

Customer Customer retentionCustomer satisfactionCustomer acquisition Per customer value

Retention %Survey Rating% of new customers % of turnover per customer

75%60%60% 50%

75%74%70%50%

75%85%75%50%

Internal process Customer complaintsWeb site down timeWeb site upload time

% of complaints% time site down – peak % of errors

35% 12%20%

30% 10% 12%

25%10%7%

Learning & Development

New additionsNew linksLanguage translationsEmployee training rate

# of new additions to the site# of site links# of language translations# of training hours per employee

50%35%25%75%

50%40%25%75%

50%40%25%75%

Budget 1996 1997 1998

Receipts £ £ £ £ £ £

Balance b/f 390000 -11260000 3902500

Turnover:

A,B customers £300*20000 6000000 £350*35000 12250000 £400*50000 20000000

C1,C2 customers £180*95000 17100000 £150*85000 12750000 £150*87750 13162500

23490000 13740000 37065000

Payments

Web Development 25000000

Web Maintenance 4000000 4200000 4410000

Marketing expenses(offline) 3000000 2750000 2500000

IMC 2000000 2100000 2205000

Administrative expenses 750000 -34750000 787500 -9837500 826875 -9941875

Balance c/f -11260000 3902500 27123125

* Assumption : Inflation rate is 5%.

Customer price  assumptions will vary (+ /­ 30%)  

After 3 years;

•In 1998 Corporate objective is in-line with the targets.•(Increasing Turnover by 50%)• £33162500 – £22000000 *100 =

50.07%• £ 22000000•

Marketing objective is in-line with the targets•(Increasing Market share by 45%)• 137750 – 95000 *100 = 45%• 95000

END