MARKETING MANAGEMENT
Written Report of ParcelForce Case Study
JANUARY 29, 2022
SUBMITTED BY
Joseph Christopher Sam
Table of Contents
SYNOPSIS / EXECUTIVE SUMMARY .......................................................................................... 2
PRICING STRATEGY .................................................................................................................... 3
Definition of Pricing Strategy …………………………..……….………………………………………………3
Types of Pricing Strategy................................................................................................ 3
Value Based Pricing
Competitive Pricing
MARKETING RESEARCH ……………………………………………………………………………………………………………………4
Defination of Marketing Research ……………………………………………………………………………………….4
Difference between Primary and Secondary Research …………………………………………………………5
Overview of Primary and Secondary Research …………………………………………………………………….5
MARKETING MIX ……………………………………………………………………………………………………………6
Importance of Marketing Mix ………………………………………………………………………………….6
Product and Price …………………………………………………………………………………………………..6
Price and Place ……………………………………………………………………………………………………….6
Analysis of Product Price ………………………………………………………………………………………..7
Place and Promotion ………………………………………………………………………………………………7
STEPS INTRODUCED BY PARCEL FORCE ……………………………………………………………………………8
CONCLUSION ……………………………………………………………………………………………………………….10
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SYNOPSIS / EXECUTIVE SUMMARY
Reading through the extract of the case studies published by The Times 100 Business Case
Studies that gives an idea of the successes of business within the UK and the world it is evident
that laid down strategies, plans and procedures when properly implemented and executed
gives birth to positive result.
This has been seen in Parcel Force story and how they carefully curated and drafted a new
approach by introducing new and existing products into a very competitive market. With
Parcel Force new tactics and strategy, using the marketing mix to drive change they are the
leading private shipping and delivery service in the UK and with its exceptional services they
sit at Number 7 in the whole world behind the following;
-
Number 1: United Service Parcel Inc
Number 2: DHL Express
Number 3: FedEx Corporation
Number 4: United States Postal Service
Number 5: Schenker AG
Number 6: TNT N.V
This stated information is based on independent research done by Supply Chain Magazine a
global digital procurement, supply chain & logistics industry.
The case study previews and gives insights on Parcel Force’s marketing success and what can
be achieved with the adoption of good tactics and techniques to drive growth and revenue.
Some of the findings from the case study are;
-
Parcel Force used the marketing mix to drive change in their new strategy.
The new changes displayed the use of technology to drive change.
Price differentiation for the various services to address market needs and wants.
This report furthers moves on to support the strategies implemented by ParcelForce and the
goal it achieved by engaging in market research and how they used those findings to answer
and meet the needs of its client.
The research enabled them to set the right pricing, introduced new services, develop the right
communication channels for promotion and use the already existing distribution channel to
get goods and services to clients. With these developments ParcelForce emerged as leaders
is delivery products, pricing etc.
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PRICING STRATEGY
Definition of Pricing Strategy
Business Yelp. Com defined Pricing strategy as “The different approaches that businesses take
to figure out what the cost of their goods and services should be.”
Wikipedia makes us to understand that a business can use a variety of pricing strategies when
selling a product or service. To determine the most effective pricing strategy for a company,
senior executives need to first identify the company’s pricing position, pricing segment,
pricing capability and their competitive pricing reaction strategy.
These strategies are not fixed and they vary from one company to the other. One strategy can
be suited for one business and another strategy for another.
Types of Pricing Strategy
Pricing and a strategy to support it is key and essential to the growth of an organization.
However it can be a tool that is underutilized and if properly implemented, can prove to be a
better asset than customer acquisition. Pricing Strategies in general context, are processes
and methodologies organizations use to set prices for products and services.
Marketing experts lists the following strategies. These strategies are independent but can be
merged suited to address the needs of organizations.
Some of the common pricing strategies are;
-
Value-based Pricing
Competitive Pricing
Price Skimming
Cost-Plus Pricing
Penetration Pricing
Economy Pricing
Dynamic Pricing
Analysing the case study, it shows that Parcel Force applied the following strategies;
-
Value Based Pricing
Competitive Pricing
Value Based Pricing: This strategy focuses on setting prices based on customers’ views on the
worth of your product service. Parcel Force Worldwide has differentiated it products by
offering services that offer a balance and choice between speed and value for money. This is
carefully seen in the premium laid on the services they offer i.e Express Service & Non-urgent
product; one relies on speed and the other on price.
Competitive Pricing: In 2010 as ParcelForce changed their marketing model, the competition
presented showed a slight variation in the competitive edge they had on the market. With
the introduction of new services and products, they had to present an attractive price for
services.
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MARKETING RESEARCH
Definition of Marketing Research
Marketing Research as defined by Investopedia.com is “the process of determining the
viability of a new service or product through research conducted with existing customers or
potential customers”. It further moved on to state the essence why companies invest in these
actions as it enables organizations to discover the target market and get opinions and other
feedback from customers about their interest in the product or service.
This was clearly the case for our clients. Because of emerging new threats, technologies and
demands in the market, they had to rebrand their image and reposition themselves to be
head of the food chain.
DIFFERENCE BETWEEN PRIMARY AND SECONDARY RESEARCH
Data is key for continued success of organizations and data is driven by accurate research.
Research uncover mysteries and can unlock possibilities for growth, when careful analysis are
carried out. Overall Research when properly implemented and executed can be of great
benefit to companies as they are important for decision making. Research provides answers
to challenging questions and problems, from getting a grip on industry trends, identifying new
products to produce and deliver to the market or deciding on which site to locate an outlet
to better understand what is needs to fulfil customer demands.
This was exactly the action introduced by ParcelForce Worldwide. With growing competition,
emerging new technology, new service demands by consumers, management had to address
the concerns of its customers, review its strategy and policies for them to gain competitive
edge over competitors.
Following the successful execution of an extensive market research, ParcelForce was able to
regain it’s footing on the market and come back on top. The research carried out enabled
them to answer the following questions;
-
Main factors affecting decision making for its customers.
Services they provided (Product Portfolio)
Tracking
Management report
Customer service
Speed of delivery
Customer needs
From our case study it proved that our company in question engaged in Primary research
which was largely done through Web interviews. Although not an effective research method
but it accomplished their work. Primary research can be very time consuming, expensive and
take a long time to complete especially if it involves face to face contact with customers. It
also involves a degree of market research to get the desired result.
ParcelForce had to engage in Primary research because;
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1) Primary Research is Exploratory and it is general and open minded. This mostly
achieved mostly through one on one interviews or small groups.
2) Primary Research is specific. Parcelforce needed clear answers and this type of
research does just that. Primary research are more precise and is used to solve a
problem identified in exploratory research.
Both of these actions are employed when executing Primary Research because the second
phase of the process cannot be achieved if the first process is not completed.
OVERVIEW OF PRIMARY AND SECONDARY RESEARCH
PRIMARY RESEARCH
Exploratory, Specific and Precise
Individual or Small group Interviews
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SECONDARY RESEARCH
Group of information that has already been
compiled, gathered, organized and
published by others.
Includes reports, articles, magazines or even
online
MARKETING MIX
The importance of marketing mix cannot be overstated as it is of great importance for the
success of any marketing plan.
Marketing Mix as defined by economic times states “The marketing mix refers to the set of
actions or tactics that a company uses to promote its brand or product in the market. It further
went on to highlight the inclusion of new elements that have been introduced into the
marketing mix, which includes over Ps like packaging, positioning, people and even politics as
vital mix elements.”
IMPORTANCE OF MARKETING MIX
The four key element of the marketing mix which are; Product, Price, Place and Promotion
influence each other. There is a direct relationship between these elements and that is why
it needs a lot of understanding, market research, and consultation with several people from
users to trade and several others.
Marketing Mix is key in any organization’s business plan and when properly executed and
implemented, it can yield great rewards and bring success to the company but if the opposite
happens it can have a ravaging effect to the growth of the business which can take years to
recover.
From our case study it outlines and shows the correlation between Product, Price, Place and
Promotion.
PRODUCT AND PRICE
It is evident that Parcelforce was not introducing a new product, however they introduced
new services to complement and already existing product to gain a competitive edge. The
introduction of these new services to support the product was not all they needed to do
because we see in further readings that they adopted a pricing mechanism to support the
new services they introduced. Pricing is affected by a number of factors which can include
market share, competition, material cost or customers’ perception and value for the product.
A customer uses several criteria to decide how much they are willing to pay for product in
order to satisfy individual needs. Overall a customer decides whether a products price is right
and therefore setting prices for products must always start with the customer.
With its introduction of new services for selected market groups, they were able to set prices
based on needs of the customers and this clearly was a step in the right direction because of
the business’s position in the current market.
PRICE AND PLACE
Parcelforce new services introduced to the market which they branded as; Global Express,
Global Priority, Global Value addressed the following needs of their customers;
-
Speed
Balanced (I.e. Price and Speed)
Price
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Customers can access, Parcelforce’s services VIA means of depots, post office branches, direct
collection by Parcelforce worldwide, international partner networks overseas. With the rapid
growth in technology, customers took part of the package journey which gave them a whole
new experience and thus increased trust in the brand. This new experience displayed valued
for money and it is mostly said that customers buy experience and not the product.
In essence, place decisions are associated with distribution channels and ways of getting the
product to customers. It is important to consider how accessible the product or service is to
ensure that your business is easily located. ParcelForce network partner GLS provides
unrivalled road-based European network and in addition they are part of EMS. Because of
these partnerships it reduces cost both in capital and revenue as the need of setting up new
delivery systems or channels is covered by these partnerships. These partnerships also
enables ParcelForce to extend its services to the global market with ease.
ANALYSIS OF PRODUCT PRICE
Price composes the revenues to be generated by ParcelForce. The prices of products detects
the socio economic groups. Because our business is trying to regain competitive edge, there
should be a balanced relationship between the price and the product as seen by the various
services introduced to meet customer’s need.
The product’s price js related to;
-
Seeking in market
Covering cost
Price which generates profit
Competitors and Competitive products
Customers benefit
Therefore, deciding the price of a product is very important. Some points to consider are;
-
Product worth to customer
Production cost
Competitor’s cost.
PLACE AND PROMOTION
Promotion mostly refers to awareness schemes and public relations to get the public
informed on product. The core goal is to reveal a products value, need and reason why they
should make payment for a product.
Marketers tend to tie promotion and place which is a fair thing to do in a bid to reach their
core audiences. For Instance in the digital work space “place and promotion” factors are much
online as they are offline.
Our company in question communicated messages to the public using available existing
technology which were email campaign programs and online banner advertisements on
website. This promotional strategy worked well for them because Parcelforce was already
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known and with all the data they possess it made it easier to leverage customer information
and personalize information for every customer. Though there’s no way to properly plan how
to market a product without eventually discussing promotion, preliminary research helps
bring a product to a new market, ye the process necessitates subsequent implementation.
When discussing and planning promotion, it further leads marketers to define a marketing
plan and in turn define a marketing mix strategy. When you careful curate marketing mix
elements it births a marketing model for the product.
It is evident that the strategy behind every element should tally with elements. If one element
is poorly implemented it has a synonymous effect over others. This means there should be a
proper balance between product, Price, Place and promotion. This is clearly why emphasis
are laid in these areas when marketing plans are developed.
STEPS INTRODUCED BY PARCELFORCE TO UNCOVER MARKET NEEDS
Due to the growing concerns and fierce competitions, ParcelForce had to adopt new models
of marketing to reflect the changes affecting both internal and external environment. They
had to apply the marketing mix to address these evolving issues and stay on top of the food
chain.
From the case study published it outlines the following changes implemented by the
organization;
-
Application of the Marketing Mix with key focus on its’ products, price, promotion and
place (access to products and services)
Use of technology to increase product value
Use of technology to increase experience in the customer buying journey.
Introduction of various price schemes to address needs of clients, business etc.
Extensive market research
1) Application of Marketing Mix and Market Research
The threats posed to ParcelForce can only be addressed by carefully formulating
strategies to address the elements of the 4P’s.
One of the steps taken was to engage in market research to unearth the issues they
face and draft solutions to address these problems. The research gave birth to the
following reviews;
- Speed not price was the primary factor.
- Product portfolio was not aligned to customer needs.
- Customers needed reliability, management report, customer service and good
tracking.
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From the research they were able to come with up solutions to meet the needs of customer.
2) Use of Technology to Increase Product Value and Experience
With the introduction of the tracking system, it helped ParcelForce to re-assimilate its regular
operations, enhance the customer experience and eliminate extra steps while allowing them
to work quickly and efficiently. A customer can log into the company’s website and locate an
item sent and communicate its location to the receiver. This was a great addition to their
services.
3) Introduction of Pricing Schemes to address customer needs.
New Services birthed new prices. This was a pivotal decision by ParcelForce marketing team.
These new services and prices addressed the following concerns;
-
Speed
Price
Balance (Speed and Price)
The prolific step of engaging in market research was the most important action taken by
ParcelForce. The research enabled the organization to have a better view and understanding
of their product and also enabled them to determine how to reposition and rebrand it’s
services. For a market orientation organization as huge as ParcelForce Market research is very
key and important. During the market research, ParcelForce was able to achieve the
following;
-
Obtain critical information about the evolving market, the changes and business
environment which included competitors, etc.
It gave Parcelforce an accurate view of the business position and market place.
The research revealed how customers and prospects view the business. Its products,
services and determined the value.
It enabled the organization to make wise decisions about product packaging and
promotional decisions. This was why ParcelForce had to engage in these type of
promotional campaigns above the line and below the line type of marketing as it
enabled them to control their message and curate their message for their audience.
Market research is a key component in developing sound and effective marketing strategy by
providing a fact-based foundation for estimating sales and profitability. Between making wise
decisions that drive business forward and poor decisions that can damage your business exists
a very thin line and a well implemented market research will give you the leverage to
overcome the odds and make the pro’s work in your favour as it did for ParcelForce.
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CONCLUSION
It is evident that ParcelForce submitted their case to the market in a model that makes it hard
for customers to refuse because it captured every area that needed a review. They carefully
presented a strong case to eliminate its competitors and stood their ground as leaders is
delivery services.
We can see from the case study that they detailed every area of the SWOT analysis (strengths,
weakness, opportunities and threats) and after extensive market research the findings were
thoroughly reviewed. All this was part of the process involved in creating a working marketing
mix.
Because of a vibrant marketing research team, the organization was able to adopt great
pricing schemes and models which defined the value of the new services for clients to use.
This shaped the overall revenue goal of the organization. It was also seen that ParcelForce
aligned their product to meet customer demands and needs. The introduction of the tracking
system as part of their branding strategy gave clients a new experience and enabled them to
be part of the journey.
Experience is key in the customer, buying and selling journey. Customers buy experience that
is of value and that was why ParcelForce invested in increasing their customer experience,
product value etc.
There is so much we can learn about ParcelForce marketing strategies, research, services and
pricing as they mine greatly deal if information when you tie the strings together.
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