This chapter, I believe, is the most important chapter we have covered thus far. The essence of chapter 5 is about how you define and describe your marketing mix. More specifically, an entrepreneur needs to define and establish his company's 4-P's in order to be successful. The 4 P's are: Product, Price, Place, and Promotion. For this chapter, I thought it would be fitting to look at Anytime Fitness in Germantown and to look at Anytime's four P's.
First, we will look at the product that Anytime offers. Anytime Fitness locations typically fall into the category of a small gym. They cater to people who would rather workout in a more private setting. They use the highest quality equipment, where as large gyms typically have cheaper equipment because they face a higher level of wear and tear. Also, the people who go to Anytime typically are not interested in swimming pools, climbing walls, and karate classes. All they want to do is work out...
Next, Anytime's prices is typically lower then memberships at large gyms. This is because members are only paying to use weights and cardio equipment. Members are not being forced to pay for features that they may not use.
The location of an Anytime Fitness is key to their success. Big gyms have the ability to attract people from farther distances from the gym then small gyms do. Therefore, franchisees have to be absolutely sure that the location they choose will support their business. This is probably the riskiest part of opening an Anytime.
Finally, Anytime Fitness offers a few corporate promotions. These include: 7 day passes, discount coupons, and apparel that are offered at all locations. In addition to the corporate promotions, individual Anytime owners are able to run promotions as they please.
Monday, October 25, 2010
Tuesday, October 12, 2010
Chapter 4: Exploring Your Market
Chapter 4 deals with the process of defining your target market through market research and using that information to develop your marketing plan. In order for marketing to be successful, entrepreneurs must perform market research, through primary and secondary means, to identify their target market(s) and competition.
For this chapter, I chose to look at Restoration Systems, Inc. I want to use Restoration Systems as an example and show that, while the book gives good generic guidelines on how to do research and discover your market, situations can be different depending on the nature of the business and the individual characteristics of the business itself. While reading through the book, I have noticed that the textbook seems to be angled more towards retail businesses, or selling physical goods in some way. In fact, this is something that I have noticed about most college classes and textbooks. While there is simply not enough time to teach specifically every type of business, it seems that business school in general is angled more towards industries that manufacture or sell physical goods. Understandably, if you were to open a retail store from scratch, you would have to make 100% sure that you are going to meet your target markets needs and expectations.
Restoration Systems began a little different then normal. In it's beginning, RSI was another company that was in a similar, but different business. It started out as a fire, water, mold remediation and emergency service company. The target market then was insurance companies. Think about it, as soon as people get off the phone with 911 or the fire department to get them to come put their fire out, who do they call? As soon as they end the call with 911, they dial their insurance company! So, the obvious choice was to market to insurance agents and insurance adjusters (both independent and employed), not individuals. In that type of business it is a little different, you are serving the property owner, but you are working for the insurance company.
When Restoration Systems began, the marketing boundaries that were in place for the franchise were lifted. RSI was created to be a multi-family construction specialist. The previous franchise was only able to do small scale, local jobs. The owner of RSI set out to build a business that had limitless capability in handling any size job. He no longer wanted to do fire clean-ups that lasted 3 days and water damages that lasted 1 day; he wanted to take on full apartment interior and exterior renovations, apartment to condo conversions, and large scale apartment disaster rebuild. This meant that RSI had to get away from only marketing to insurance companies (still responsible for apartment disasters, of course), but also marketing to management companies and property owners. This was a different level of customer. Dealing with local insurance agents, it was easy to develop relationships with them because you have more in common with them: small business owners, live in the same city or area, etc. Management groups and apartment owners, on the other hand, meant large corporations with CEOs, departments, millionaires and even billionaires. "It was a complete change in market for us," explains Darral Simmons, owner of RSI.
Relating this back to the text, you can see that RSI really did not have a clear marketing plan upon starting the business. Construction companies can have many different markets that come and go. As for RSI, it grew to become a multi-family construction company from a company that dealt primarily with residential construction. I believe that the vision of RSI is what lead it to where it is today.
For this chapter, I chose to look at Restoration Systems, Inc. I want to use Restoration Systems as an example and show that, while the book gives good generic guidelines on how to do research and discover your market, situations can be different depending on the nature of the business and the individual characteristics of the business itself. While reading through the book, I have noticed that the textbook seems to be angled more towards retail businesses, or selling physical goods in some way. In fact, this is something that I have noticed about most college classes and textbooks. While there is simply not enough time to teach specifically every type of business, it seems that business school in general is angled more towards industries that manufacture or sell physical goods. Understandably, if you were to open a retail store from scratch, you would have to make 100% sure that you are going to meet your target markets needs and expectations.
Restoration Systems began a little different then normal. In it's beginning, RSI was another company that was in a similar, but different business. It started out as a fire, water, mold remediation and emergency service company. The target market then was insurance companies. Think about it, as soon as people get off the phone with 911 or the fire department to get them to come put their fire out, who do they call? As soon as they end the call with 911, they dial their insurance company! So, the obvious choice was to market to insurance agents and insurance adjusters (both independent and employed), not individuals. In that type of business it is a little different, you are serving the property owner, but you are working for the insurance company.
When Restoration Systems began, the marketing boundaries that were in place for the franchise were lifted. RSI was created to be a multi-family construction specialist. The previous franchise was only able to do small scale, local jobs. The owner of RSI set out to build a business that had limitless capability in handling any size job. He no longer wanted to do fire clean-ups that lasted 3 days and water damages that lasted 1 day; he wanted to take on full apartment interior and exterior renovations, apartment to condo conversions, and large scale apartment disaster rebuild. This meant that RSI had to get away from only marketing to insurance companies (still responsible for apartment disasters, of course), but also marketing to management companies and property owners. This was a different level of customer. Dealing with local insurance agents, it was easy to develop relationships with them because you have more in common with them: small business owners, live in the same city or area, etc. Management groups and apartment owners, on the other hand, meant large corporations with CEOs, departments, millionaires and even billionaires. "It was a complete change in market for us," explains Darral Simmons, owner of RSI.
Relating this back to the text, you can see that RSI really did not have a clear marketing plan upon starting the business. Construction companies can have many different markets that come and go. As for RSI, it grew to become a multi-family construction company from a company that dealt primarily with residential construction. I believe that the vision of RSI is what lead it to where it is today.
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