BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
Assessment 2- Project
1: EXECUTIVE SUMMARY
Cranium Filament Reductions is a hair salon located in Shaker Hts., Ohio that allows the entire
family to have their hair needs satisfied in one convenient location. Cranium serves men, women,
and children and accepts appointments as well as walk-ins. Cranium also sells retail hair care
products. Cranium is able to serve the entire family in one quick, convenient visit.
While there are many "quick salons" like Cranium, Cranium will excel due to its attention to detail
regarding customer service. Through unheralded customer attention, Cranium will slowly but surely
gain market share as it services the entire family, creating long-term relationships. Lastly Cranium's
location will allow it to attract a lot of walk in traffic.
After month four, sales will grow steadily for Cranium. Profitability will be reached by month nine
and $443,000 in revenue will be earned during year three with $61,000 in profits.
1. Monitor their marketing mix against marketing performance and complete the
following
Isolate components for testing.
Objective Actual Result Comment
Revenue Revenue @ $4,950,000 Same number of units sold but at a lesser
@$5,500,000 or 10% reduction price
Profit @ 16% Profit@ 0% or Lower sell price but same quantity & costs
Breakeven
Customer Satisfaction Qtr Survey, 100% now Greater competition means ALL customers
New Build - rate it as “Essential” place more importance on customer service.
CustomerService =
90% essential
Customer Satisfaction Qtr Survey. Only 10% Australian made is no longer of major
New Build - say it is “Important” importance.
Australian Made =
80% important
Social Media not Qtr Survey indicates Social media is becoming a greater form of
considered important young families – new entertainment & communication
builds – social media
important
Distribution – online Qtr Survey indicates, E-Commerce is an important channel
not a major avenue this is an important
channel.
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BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
Identify areas of poor performance to be adjusted and monitored.
Marketing Test strategy Poor Adjustment Monitored
mix performance
component
Product The Product is the first Similar The product is a service. The Sale report
thing that customers product in the hair salon already has a
scrutinize in order to same industry variety of services, but to
know its benefits mingle in the minds of
decide whether they individuals, it should also
should buy it or not. the have trained barbers, hair
product is a service. loss therapy, shower and
The hair salon already locker facilities, a separate
has a variety of section which is just for hair
services, but to mingle styling and a comfortable
in the minds of waiting room in order to gain
individuals, it should popularity.
also have trained
barbers, hair loss
therapy, shower and
locker facilities, a
separate section which
is just for hair styling
and a comfortable
waiting room in order
to gain popularity.
Price The price in this Lower price ‘Family’ Discount: Sale report
business is a huge is always an Sometimes fathers often
factor, because the advertisement accompany their sons for a
competitors will always itself. Many haircut, this happens usually
try to give a lower services could when their children are
price. However, it is an be combined young and both get haircuts.
effective tool to draw together and ‘Family’ Discount is
the attention of people. offered at a provided to families who
lower price. come together to the hair
salon and each use a service.
This will attract the middle-
aged individuals.
Promotion This is focused on the The objective Free haircut during the first Sale report
methods used to make of the week:
the people aware and promotion in The hair salon could provide
interested about the the initial free haircut for the first three
services provided by stage would days after its opening, and
the hair salon. The be to educate the customers would provide
customers coming to a the people, feedback about the service.
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BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
hair salon are usually, about the This will help them gain
the people living services of publicity and also help them
nearby the location of the hair salon realize their shortcomings.
the hair salon. to the
residents of Posters:
the area Poster, mentioning about the
where the hair initial free service have to be
salon is put up on most of the walls,
situated. This in the area surrounding the
could be done location of the hair salon,
in various one week before the
ways inauguration.
Leaflets:
Leaflets and brochures
should be sent inside the
popular newspapers to the
people living in the area
where the hair salon is
located at.
Banners:
Banners should be put up
near schools, colleges and
universities in the area
surrounding the location of
the hair salon.
Newspaper and Magazines:
After one week of the
inauguration, advertisements
about the facilities, package
deals and discount should be
published on newspapers and
popular fashion magazines.
Place The location should be Location The location would be best if Customer
given the highest inflexibility it is a residential area, with a satisfy
priority when to consumer few schools, colleges, offices static
marketing a hair salon, nearby, for publicity. The
because it helps to residential area would
decide the market always be a best option
targets and the price. because most people get a
haircut in the hair salons
which are near to their house.
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BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
2. Evaluate implications of altering one or more components of marketing mix in relation
to market factors and consumer response.
People:
Service is a two ways process; the output also depends on the cooperation of the customer.
The employees should be well trained and experienced to identify the needs of the customer.
They should also have the ability to make suggestions to the customers, and hence they need
to be updated every day about new hairstyles. They should also analyze the mood of the
customer and not make too many suggestions and ask for feedback after cutting one area.
They should also be very friendly and talk to the customer and try to become close to them,
but at the same time also concentrate on their work and the mood of the customer because
some customers prefer a quiet environment.
Physical Evidence:
This can include the interior and exterior decoration, the uniform of the staff, the receipt they
receive after the payment and the brand name for the hair salon. They could concentrate on
the following aspects:
Interior and exterior decoration:
A flashy and colourful exterior decoration will make the people think that the hair salon is
expensive and hence there will be a loss of many customers. Light colours should be used for
the exterior decoration and the interior decoration should create a homely atmosphere and
hair salon should be spacious.
The uniform of the staff:
The uniform of the staff also be light coloured and the name of the hair salon should be
written in black colour on the uniform, for the customers to notice and the name of the staff
should also be written on the uniform, so that parts of the service stay in the sub conscious
mind of the customer .
Membership cards:
They can also provide customers, with membership cards which them some extra privileges,
like discounts, or gifts on certain occasions after a raffle draw.
3. Adjust components of marketing mix in response to previous monitoring
PRODUCT:
Every product will be maintaining good quality.
Everybody can explore their own beauty with the help of the professional beautician in the
friendly environment.
The equipment and machinery are very modern and convenient.
PRICE:
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BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
Cranium Filament Reductions will provide the best service in very affordable price.
The basic products will be starting as low as $ 10. This price is very low comparatively to
any other beauty salon.
Young people can enjoy the special service with their monthly subscription which is 30%
cheaper than regular service.
Some packages can available with great price deals.
PLACE:
This place is connected with frequent bus, rail and train service. So, its communication is
very good.
The business will be in the roadside so there is no problem to access for disable or physically
handicapped people.
PROMOTION:
Advertise will regularly come in the daily newspaper.
The posters will fix up in to the local areas.
Website can help to promote this business.
Nearest Shops will be referring the people for use the service.
Special promotion strategies will be taken in the Easter, Christmas and main events.
4. Recommend changes supported by evaluation of performance/market testing
I would like to using advertisements to promote our product. Example out door
advertisements (Poster, Billboard), Social media or TV. We may put some promotion like
discount to:
Increasing the market share by 3% or entering a new market overseas.
To increase the number of customers by adding new additional services such
as Hair loss therapy, Shower and locker facilities, and Separate styling section.
5. In recommending changes, outline relevance of the following
We will research more about the legislation and make sure that we are working under law
to ensure a certain level of quality or reasonable price for certain products to keep the
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BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
customer safe and prevent them for being provided. The industries this applies to find
often their costs elevated.
And we have to research about our competitors. It is extremely important for us to know
about the positioning, pricing, strengths, and weaknesses of our competitors. The insights
we gather on our industry. It will help us to improve our marketing strategies and truly
stand out to our target audience.
6. Ensure adjusted marketing mix meets budgetary requirements
Our salon is going to have a marketing budget that will be high in the beginning to start up
our business and to catch the eye of our customers. After we start it up we will then lower our
expenses because in will increase again during the winder months for holidays.
Budget Item Original New Budget $
Budget $
Sales $11,000,000 $ 10,000,000
Investment $1,567,000 $ 1,500,000
Gross Profit $6,677,000 $6,500,000
7. Ensure
Expenses adjusted
Wages $2,567,890 $2,000,000
Consultancy $50,000 $30,000
Communication $42,000 $40,000
Marketing $800,000 $500,000
Capital Exp $120,000 $100,000
Training $62,187 $45,000
Total Expenses $4,884,714 $ 2,715,000
Net Profit $1,792,286 $3,785,000
marketing mix continues to meet organisational, strategic and operational marketing
objectives, and desired positioning
Performance Monitoring Performance Timing/Frequency Responsibility
Activity Benchmark
Customer Survey at each 100% with a 4 months Marketing
Service customer rating above 4 Manager & ALL
transaction Customer Service
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BSBMKG502 – Establish & Adjust Marketing Mix Songsupa Dangyam(170064)
5: CONCLUSION
The success of a business always depends on the way their product or service is marketed as it is the
most crucial stage of a business. With proper marketing program a business will flourish, and the
issues and solutions mentioned above will give this hair salon a competitive edge. With effective
implementation of the solutions mentioned above this hair salon will be one of the best hair salons.
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