What happens in “The Cube”, Stays in “The Cube” Marketing Plan for the night club. Prepared for Susan Halsall Tour 112-05 Prepared by Irina Gorbunova Fiona Lee Marco Pasini 3/16/2016 Table of Contents 1.Executive summary.................................................................................................................................................. 4 2. Situational analysis - 4Cs and TREES ................................................................................................................ 5 2.1 Company and business description ..................................................................................................... 5 2.2 Customer and market summary............................................................................................................ 5 2.2.1 Market Demographics ........................................................................................................................ 5 2.2.2 Market needs ......................................................................................................................................... 6 2.2.3 Market trends ...................................................................................................................................... 6 2.3 Competitors ........................................................................................................................................................ 7 2.4 Channels ......................................................................................................................................................... 8 2.5 TREES .............................................................................................................................................................. 8 2.5.1 Technology .................................................................................................................................................. 9 2.5.2 Regulations ........................................................................................................................................ 10 2.5.3 Economic situation ......................................................................................................................... 12 2.5.4 Ecological and environmental situation ................................................................................. 14 2.5.5 Social & Cultural situation ........................................................................................................... 14 3. SWOT ......................................................................................................................................................................... 15 4. Key to success ........................................................................................................................................................ 16 5. Critical Issues ......................................................................................................................................................... 16 6. Marketing Strategy............................................................................................................................................... 17 6.1 Mission Statement ......................................................................................................................................... 17 6.2 Target Markets ............................................................................................................................................... 17 6.3 Marketing objectives .................................................................................................................................... 18 6.4 Strategic focus ................................................................................................................................................. 18 7. Marketing Mix ........................................................................................................................................................ 19 7.1 Product action plan ....................................................................................................................................... 19 7.1.1 Positioning and branding ................................................................................................................... 20 7.1.2 Product decisions .................................................................................................................................. 21 7.1.3 Delivery decisions ................................................................................................................................. 22 7.2 Distribution Action Plan.............................................................................................................................. 22 7.2.1 Access ................................................................................................................................................. 22 7.2.2 Resellers/Intermediaries ............................................................................................................ 23 7.2.3 Partnership ....................................................................................................................................... 23 2 7.2.4 7.3 Title Transfer.................................................................................................................................... 23 Pricing Action Plan .................................................................................................................................. 24 7.3.1 Costs ..................................................................................................................................................... 24 7.3.2 Competitive Pricing ........................................................................................................................ 24 7.3.3 Consumer – level Pricing. ............................................................................................................. 24 7.3.4 Methods and Terms of Pricing.................................................................................................... 25 7.3.5 Promotional Pricing ....................................................................................................................... 25 7.4 Promotion................................................................................................................................................... 25 7.4.1. Groundwork ................................................................................................................................................ 25 7.4.1.1. Audience Analysis ............................................................................................................................. 25 7.4.1.1. Internal and External Analysis ..................................................................................................... 26 7.4.1.2. Objectives ............................................................................................................................................. 27 7.4.1.4. Promotional Tool Strategy: ........................................................................................................... 27 7.4.2. Digital Media Action Plan ....................................................................................................................... 28 7.4.3. Advertising Action Plan .......................................................................................................................... 28 7.4.4. PR and Publicity Action Plan ................................................................................................................. 28 7.4.5. Sales Promotion Action Plan – Consumer and Trade ................................................................... 29 Appendix 1 ................................................................................................................................................................... 31 References ................................................................................................................................................................... 33 3 Marketing Plan Executive summary Popularity of the nightclubs is never going down. From the other side, it’s getting more and more preferable activity for the night among young people. The popularity to the nightclub can be brought by unique concept, good music and the right choice of target market. That’s why we decided to focus mainly on the local people of Vancouver and secondly, inbound tourists. For our main target we identified wants and needs and also divided it on local men and local women. We decided to create a unique nightclub that is completely different form others in Vancouver. Our main target market is students from Vancouver city and area from 19 to 34 years old, who like socializing, good atmosphere and music. Our secondary target market is inbound tourists whose number is growing weekly. The age of this target market is similar, but they usually have more discretionary money. Through the analysis of the situation on the nightclub market in Vancouver, we found out our strength and weaknesses and according to these facts, our opportunities that can be taken and threats that we should try to avoid. Our two main objectives are to build awareness at the launch stage and a long-term customer loyalty program. Our location is going to be in the heart of nightclubs of Vancouver city. It is going to be bright and transgressive that will attract the attention of everyone. Our main target will go to our club because it will stand out of every other club on Granville Street’s area. We did a research of prices of our competitors and found out the average price. Following it, we decided to make it a bit lower than competitors’. The cover price is going to be approximately $10, the average for the drinks is six dollars and a coat check is four dollars. Our price also meets all the quality needs of our target market. Through the promotion and advertising, we will create the awareness of our night club even before the opening day. Partnerships with local café and small liquor company are needed to be established. Advertising in mass and outdoor media and promotion involving digital media, sales and public relations will help to let people know about “The Cube”. “The Cube” will meet all needs of people who are tired of doing the same over and over again. It will be different from its interior to unique events and theme parties. 4 2. Situational analysis - 4Cs and TREES 2.1 Company and business description The night club was founded in 2013 and has 16 employees such as 5 security guards, 3 bartenders, 2 cleaners, 2 front desk managers, 2 helpers and accountants. Having a sufficient number of bartenders, servers, security guards and hosts is crucial and avoids negative publicity from impatient customers waiting to order a cocktail. In the future, new employees will be hired if needed. We use to hire DJs, dancers and photographers every week. The concept and management of the Nightclub has been well received, and has been offered key placement in downtown Vancouver on Granville Street. Even though there are many nightclubs in the area, the product will be differentiated in order to bring something special. Most of the nightlife in Vancouver takes place here; people are always around and like to experience more clubs, even in the same night. This will give many chances to retain customers and make them living the experience. The Nightclub count on making a good impact when opening, as young people are mostly willing to try a new club. Vancouver’s population is increasingly growing as well as the number of tourist coming, which can only be an advantage if placed on Granville, although the strong competition. The Nightclub will be a 10,000 square foot unit, which will also be our company’s office. The dance club and bar will accommodate 750 people. The store will be equipped with the brand new audio and video systems, following new technology trends. The general appearance will be clean, opened, and pleasing to the customer. The bar and the dance floor will be quite far from each other, as some people may enjoy drinking with more space around, as well as who dance may like to not be surrounded by drinkers. 2.2 Customer and market summary Two are the major target markets considered to be appealing for the nightclub: the local men and the university-age women both aged between 19 and 34 years old. 2.2.1 Market Demographics The local men aged 20 to 34 consist in 21.4 % of all Vancouver’s male population, while is 19.6% considering all BC’s male population (2008). About Vancouver, is the highest age group percentage after the 40-54 age range. Looking at projection for BC, the percentage of the male age group slightly enhanced up to 2013(21.6%). By 2020, the percentage of males aged 20-29 is going to drop from 14.6% in 2013 to 12.8%. Local females aged 20-34 are the 20.8% of all the Vancouver’s female population; like for males, their age group is the second highest after the 40-54. Vancouver’s females are slightly more than males. This is the link with all the data about Vancouver and British Columbia demographics: http://www.city-data.com/canada/Vancouver-age.html http://www.bcstats.gov.bc.ca/StatisticsBySubject/Demography/PopulationProjections.aspx 5 2.2.2 Market needs According to the statistics (Canadian Business News,Investing and Commentary), average household in Canada spent $858 on alcohol in 2011, almost 34% of people between 20 and 34 were considered ‘heavy drinkers’ and also, they tend to purchase more and more drinks, one after one. That’s why the focus will be more on the local men. Instead tourists, which a secondary but important market, may increase drinking if they socialize that helps them feel more comfortable, but it is believed that they will be attracted by the music and the atmosphere, as women will be. This is the main target market, as it is common belief that if one attract the women more than competitors, men will come too for clear reasons. More local men are in the nightclub, more will be the earnings due to their drinking volume. University age-women are looking for design and musical themes that appeal to them; they want an high-energy environment where they can socialize or have fun with friends. They buy less than men, but when loyal their presence at the nightclub will be guaranteed. Looking at the statistics above, the college-age women are more than men, so the nightclub want to take full advantage from this. Local young workers may want to have a remarkable night and many of them come from BC or even Alberta. Workers from Alberta have usually a great disposable income due to higher wages compared to BC and are willing to spend much when going out. 2.2.3 Market trends The major trends in the industry are live performers and the use of themes. Some competitors have already implemented these changes, as they actually haven’t come up recently. Nowadays, technology and music trends change quickly. Smart operators should consider integrating some of these trends into the front- and back-end of the business to stay on the forefront of a constantly changing world. About music, genres and mediums are morphing together, forming more awe-inducing spectacles; guests expect to have all of their senses stimulated at the same time. Club music is now totally up-tempo, with higher beats-per-minute. Many big and small clubs hire community managers to coordinate effectively all forms of social media; in this way, money saved to keep them will be used to pay for labor (Magazine, 2011) General bar trends are less pretension and more fun. One must hire for service skills, which can be coached but typically come naturally, over bartending skills, which can be taught. A mycologist conceives of and makes drinks, a bartender welcomes and interacts with guests and mixes and serves great drinks (Magazine, 2011). Other trends are low-calories cocktails that will appeal to the ladies, which always is good for business, and female Djs. The whole nightclub market is pretty stable. In the last few years, more and more young tourists are coming to Vancouver, either students or travelers such as working holiday makers. Many of them stay long in the city, especially during the high season (summer) which is really profitable in terms of revenues. There are some environmental factors that may affect industry sales, such as exchange rates (Canadian dollar as powerful as the Australian and close to US dollar) and increasing regulations. Anyone with a 6 license to serve alcohol needs to be aware of and opposing the following activities at the federal, state and local levels (Magazine, 2011): • Proposed tax increases aimed at raising drink prices. • Reductions in available licenses and further limitations on hours/days of sale. • “Junk science” being used by government officials and anti-alcohol groups to convince lawmakers to enact higher taxes and more restrictions. • Ignition interlock mandates. 2.3 Competitors There are many nightclubs in Vancouver and area with those our nightclub has to compete, but not all of them are really popular. According to one of web sites about Vancouver (Vancouver Nightclubs), there are 10 nightclubs and bars that can affect the success of our business: The Tonic Club, 919 Granville St, Vancouver, BC. 604-669-0469 dave@thetonicclub.com Boss Nightclub, 1320 Richards Street. Vancouver, BC. 604-617-2006 or 604-715-6986 doubledown_productions@hotmail.com Bar None, 1222 Hamilton St, Vancouver, BC. 604-689-7000 Celebrities Nightclub, 1022 Davie Street Vancouver. 604-681-6180 info@celebritiesnightclub.com Aubar Nightclub, 674 Seymour St, Vancouver, BC. 604-648-2227 Richards on Richards, 1036 Richards Street. Vancouver, BC. 604-687-6794 info@richardsonrichards.com Oydessy Nightclub, 7 1251 Howe Street, Vancouver, BC. 604-689-5256 Caprice Nightclub, 967 Granville Street, Vancouver, BC. 604-681-2114 info@capricenightclub.com Shark Club, 180 West Georgia Street, Vancouver, BC. 604-687-4275 SharkClubVancouver@telus.net Plaza Club. 881 Granville Street, Vancouver, BC. 604-646-0064 info@plazaclub.net Clubs, such as The Tonic Club, Bar None and Celebrities, provide service for people from upper class, while the others provide their service for middle or working class of people. Most of them also provide a lot of events for their customers that people who are staying or live in Vancouver can check through the Internet. 2.4 Channels Ticket sellers will hand out flyers and sell tickets and coupons near of universities, city center and community centers. On the web pages of the nightclub such as Facebook, Twitter and Instagram, people can find useful information about the events, share photos and register for a guest list. Posters will be posted on buses, bus stops and elevators by the advertising company which we work with. Concierge service will help to promote the nightclub within different hotels. Exchange flyers with a local pizza shop will help to get more customers to both places and promote each other. For operating our business we need supplies such as beverages, entertainers and photographers. Challenges with the supplies that can occur are: DJ’s are not available for that time Technical problems Short of beverages Late delivery 2.5 TREES 8 2.5.1 Technology The club will purchase the advanced ID Scanners for Bars & Nightclubs Notifications via SMS and Email system VIP and Guest list - Customer Loyalty Program And well using the social networking to Promote Your Establishment with: HotOwl: facebook twitter Instagram 1.1 ID Scanners for Bars & Nightclubs ClubSecurity system- ID scanners- for bars & nightclubs and incident tracking system in the market today. It increases the ability for your staff to recognize patrons that should not be allowed into your club is linked to a central database of incidents from all establishments using the ClubSecurity system which supports scanning of any government-issued IDs and passports. Notification is a multi-functional email and text messaging system for you and your customers. With notifications you can: Create scheduled notifications to text message your phone every 30 minutes showing you how many patrons have entered your establishment and the demographic distribution of your patrons. Create notifications so that you are alerted when VIPs enter. Create notifications so that you are alerted when you have Police / Fire / GLC inspections. Add patrons to your guest list by simply text messaging the Intellibar Notification Server. Send automated text messages to your door staff when your establishment reaches a certain capacity. In addition, the company which we purchase our system from has partnered with iTexty Media Inc. to strengthen their software suite which includes a "Text to Screen" application that allows text messages to be displayed on a TV or projector in your establishment. As well as software that allows you to create mobile marketing campaigns, contests, and much more. 1.2 VIP and Guest list - Customer Loyalty Program VIP and guest list program is a loyalty program that allows your establishment to create a "points" rewards program. You can combine multiple establishments under the same VIP program and share the customer loyalty throughout your establishments. This VIP program helps to : Create rewards system structure based on date/time of patron visit, frequency of visits, and promotional visit dates Create custom VIP cards utilizing your designs using the program in-house print facility 9 Link your VIP members to their identification cards to eliminate VIP cards Get notified via text message when important VIPs enter your establishment Track usage of VIP cards to ensure your VIP promotions are not being abused Let your VIPs accumulate rewards on their VIP account This product comes with the VIP module and allows creating and tracking Patron guest lists. It can also add patrons to the guest list via text message or allow customers to add themselves to the guest list via our iPhone and Blackberry applications. As guests arrive, the door staff can check them in to the guest list via our easy-to-use interface. At the end of the night, reports can be printed, showing a complete guest list history including expected totals, actual guest arrivals, and the times and comments of each event. 1.3 Promote the establishment with social network HotOwl These days if a nightclub wants to stay relevant with its customers, they must promote themselves on social networks. Having a Facebook page and a Twitter account is nice but not enough to keep your customers engaged in the long run. HotOwl goes beyond the traditional social sites because it interacts directly with your current and potential customers and keeps them coming back every night! HotOwl allows your customers to see the male/female ratio of the people in your establishment, and how busy your establishment currently is. It also allows your patrons to book themselves on your guestlist via the web, iPhone or Blackberry. There is a around HotOwl right now and those establishments using it are being promoted above and beyond their competition. HotOwl is the only social network for bar goers and is growing fast. The pricing is minimal compared to what company has to pay with traditional media and there are no contracts required. 2.5.2 Regulations The legal drinking age in British Columbia is 19 years of age. Everyone has to show one pieces of ID with a name, signature, picture and a birth date, such as a driver’s license or passport and the secondary piece of ID that includes a name, signature or picture, such as a credit card. If the staff has any doubts about a customer’s ID, they may refuse service. 2.1 Commercial and industrial business license: http://former.vancouver.ca/blStorage/10642.PDF 2.2 Liquor control and licensing regulation http://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/244_2002 2.3 Liquor control and licensing act http://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/00_96267_01 2.4 Additional regulations Not to sell, serve or supply liquor to a minor. When verifying a customer’s age, ask for two pieces of identification. Not to allow an intoxicated person to enter or remain in the establishment. Not to sell, serve or supply liquor to an intoxicated person. Not to allow the establishment to become overcrowded (the license will tell the maximum number of people allowed at one time). 10 Must post the liquor-primary license in a prominent spot and keep a copy of validated floor plans available for inspection. Must buy the liquor from the assigned BC Liquor Store (liquor bought from any other source is considered "illicit" liquor). Must record every liquor purchase in a register, to be ready for inspection at any time. Must follow strict limits on maximum drink size, and have a liquor price list available, showing the size of each drink the company sells and its price. May not agree to sell only one manufacturer’s products in the establishment exclusively, or to promote a particular product because of the association with a particular liquor manufacturer. May not to ask for, or receive, benefits (including money, items, products or services), for selling a particular liquor product. 2.5 Liquor Advertising The advertisement of the nightclub must not: encourage people to drink liquor or to drink irresponsibly (ads that mention price must take this into account; if a licensee's price advertising encourages or results in patrons drinking to excess, the Liquor Control and Licensing Branch can prevent the licensee from including liquor prices in future advertising) show people drinking liquor, or anyone who is either intoxicated or behaving irresponsibly or illegally associate liquor with driving be directed at minors or placed in locations used or visited mostly by minors, such as video arcades and playgrounds depict liquor as: one of life's necessities, key to social acceptance or personal success, central to the enjoyment of an activity, or a status symbol. use pictures of minors ( anyone under the age of 19), or of personalities, images or activities that may appeal to minors 2.6 Serving It Right: B.C.’s Responsible Beverage Service Program 11 Serving It Right is a mandatory self-study course that educates licensees, managers and servers about their legal responsibilities when serving alcohol, and provides effective techniques to prevent problems related to over-service. Serving It Right is administered by go2 – B.C.’s tourism industry human resources association. 2.5.3 Economic situation The state of economy for the sphere of operations of nightclubs is now stable enough to think that the worst period is gone. High unemployment and low disposable income drove consumers away from luxuries like trips to bars and nightclubs in the past five years. As consumers cut down on spending across the board, the industry suffered. Competition from a rising trend of drinking at home will continue to hamper the industry over the next five years; however, increased consumer spending will bring the industry back to solid revenues (Bars & Nightclubs Market Research Report, 2013). This was the reason why during the last five years (2008-13) the annual growth of the business was 0.4%. The annual growth for the period 2013-18 is predicted to be 0.9%. IBISWorld, a research group, estimates that bars and nightclubs make profits of $800m on takings of $20 billion-25 billion a year in America, where data are most reliable. (Bars & Nightclubs Market Research Report, 2013) 3.1 Top markets visitation and spending in the Vancouver region British Columbia residents make up the largest share of overnight visitation (39%) and spending (18%) in the Vancouver, Coast & Mountains, but at a much lower share than other tourism regions. In addition, the region has the largest market share of Washington and Californian travelers than other regions (Regional Tourism Profile, 2013). Top five markets of origin (2010) British Columbia Washington Alberta Ontario California Share in Vancouver, Coast & Mountains Visitation Spending 39% 18% 11% 5% 7% 7% 5% 8% 4% 5% Source: www.destinationBC.com 12 Moreover, international tourists spent 1.6 billion in 2010, with a growth of 15% from 2009. They got 38% of all the spending in Vancouver region, while US residents 26%. Trends of incoming international tourists are shown in this table: http://www.tourismvancouver.com/includes/content/images/media/docs/ytd_visitor_volume.pdf From direct experience, it is known that in the British and Irish culture, and as well as in the Australian, Canadian, and American (former English colonies) cultures, drinking is a common habit and an important part of the culture itself. The spending patterns of this nationalities are concentrated on drinking, supported by good disposable income when referring to English and Australians in particular( their currencies are really strong). These two ethnic groups, if targeted well can bring excellent revenues and their presence is increasingly growing in Vancouver, as it can be seen in the previous link. Americans and Canadians are major markets but their spending can vary due to ethnic diversity and more different attitudes within the countries. The local market is oriented in spending for drinks as well, but the disposable income of young people is not as good as the tourist one, as many youngsters in Canada live by themselves since major age and have to pay for their expenses in many cases. In addition, Vancouver is not a cheap place where to live. 3.2 Exchange rates (The World Favourite Currency and Foreign Exchange Rate) The exchange rate with the US dollar is currently 1.05 and is likely to increase a little in the next few months. The Australian dollar is now 1.08 related to the US dollar but is constantly changing. 3.3 Inflation rates (Beltrame, 2013) The inflation rate in Canada was recorded at 0.70 percent in October of 2013 The inflation rate for alcohol is +2% at October 2013 from last year. Recently, the Government of Canada set the alcoholics price at the following fixed minimum rate per litre: spirits—$32.66; wine—$7.20; beer—$3.54 (Backgrounder. Minimum Drinking Pricing). A significant number of Canadians drink alcohol at levels and in patterns that increase their risk of harm. Extensive research reveals that pricing and taxation policies are among the most effective strategies to reduce alcohol consumption, as well as alcohol-related harm and costs. This is a document about alcohol pricing policies in Canada http://www.ccsa.ca/2012%20CCSA%20Documents/CCSA-Alcohol-Price-Policy-Brief-Canada-2012en.pdf 13 3.4 Challenges for the future Canadian outbound travel grew faster than domestic travel in 2010; the pent-up demand for international travel and the value of the Canadian dollar may be the largest challenges to increasing travel within Canada. Also, the recession had encouraged discounting by air carriers and hotels in Canada, and the now rising prices in combination with high oil prices, may dampen domestic travel. (www.destinationbc.ca) Domestic tourists are a big portion of the local market for the nightclub: the overall cost of life is growing in BC and many Canadians may think is already high enough. 2.5.4 Ecological and environmental situation We do separate collection of rubbish and clean the sidewalk from cigarette butts every time we operate. 2.5.5 Social & Cultural situation Nowadays the number of women, coming to a nightclub is more than the number of men. We will take the advantage of this fact, trying to attract as much women as possible in order to attract more men. There are many new trends in social media such as sending photos and images rather than text through social networks such as Facebook, Instagram and Twitter. According to the business’s beliefs, nowadays investments in social media are a must, not a luxury anymore. Moreover, because Canada is a multicultural country, it’s really difficult to satisfy everyone’s’ taste of music. On the other hand, from our knowledge, drinking is an important part of Canadian, Irish, Australian and English cultures. These people are an important market for us because they are increasingly coming to Vancouver. 14 3. SWOT Strengths Easy to access( placed in the heart of the city) Newly opened club attracts people Equipment and technology always up-to-date Strong promotion Well-designed theme parties and events Weakness Not much experience Too much competition Not enough market awareness Many regulations and responsibilities on people Part-time employees may not reliable Opportunities We can take advantage of channels in case of partnership with some major suppliers. Moreover, we can cooperate with another competitor in providing some parties and at the same time promote each other. We can also provide different kind of music, including music from other countries and performances that will attract more tourists. Also, investing in new technology trends more than competitors will give us more benefits in the future. Threats 15 We should watch out for economic and political stability, new trends in music and technologies, new legislation and other competitors. All of this can affect in many ways to our business. Also, winter months will be a lot slower about tourists’ revenue, so the club needs to be focused on locals. Other clubs have more experience and better positioning than the nightclub, so we have to differentiate the product to get competitive advantage. 4. Key to success Focus on attracting university-age women Offer the great service experience to leave an impression with our customers, being up-to-date with the several technology trends and digital media. Consistent entertainment atmosphere and product quality. Strict control of costs, at all times, to manage our internal finances and cash flow. Aggressive promotion. 5. Critical Issues The number of people in B.C within age group we target has shrunk and it’s going to shrike more from 2013, as we showed in the previous statistics about age groups in B.C. If failing to make a big impact in the market, life will be hard with so many competitors around. Increasing cost of life and the new government policy about alcohol ( minimum price set, higher prices in general) may decrease domestic tourists flows and locals’ spending volume. Opening and managing a nightclub is very risky due to safety issues, responsibilities and regulations. 16 6. Marketing Strategy 6.1 Mission Statement “What happen at “The Cube”, stays in “The Cube.” The mission statement reflects the identity that we want the nightclub to have: transgressive. We will reach our mission by encouraging releasing stress and inhibitions, within moral limits. 6.2 Target Markets Primary markets: (1) local men, (2) university –age women, both aged between 19 and 34. Local men: this is the target market which will get us to gain the best profits, due to their drinking volume and their constant presence at the nightclub once they are satisfied and loyal. They are mainly driven by the need to have fun and to meet people, especially females, which can be the main reason for them to come, as they can drink anywhere else. They are likely to offer drinks to other people to get them involved, but not likely to come for the music or the atmosphere. They are generally price-sensitive, but when it comes to drink, tend to purchase drinks one after another and in some way they fill a standstill during the night by drinking. They can maintain themselves well for a couple of hours when drinking. Their buying behavior can change depending on who they are with: if with friends, they will definitely drink more, although many would drink anyway. This target market will guarantee revenues even in the low season and will make the difference in the high one. University-age women: this is the main target market as females’ presence in the city is higher and nowadays the fortune of a nightclub is driven by them. They will be the key to attract the local men and have to be treated with care. Generally coming with friends, tend to purchase much less than men but sometimes are looking for specific drinks instead of going for the usual ones. This can increase knowledge of what we offer amongst others. 17 The design and the atmosphere will be created basing on their needs and preferences and we will make them feel safe in the nightclub in order to increase their loyalty and make them speak about the nightclub with friends through social media. They are divided into two groups which can differ from each other: local and tourist women. The first ones are in numbers, tend to drink more and are generally more outgoing. Love to stay in group and can influence many purchasing decisions. The second ones have more varied behavior and are much influenced by the atmosphere, the music and the kind of people around. With our transgressive identity, we mainly count to make a big impact on local women. Secondary markets: (1) domestic tourists, (2) international tourists Domestic tourists: they are really similar to the local market but, from direct experience, there are many workers coming from Alberta or Saskatchewan, which tend to have more disposable income. Their usage is more by occasions and they are willing to spend a remarkable night for their standards, so are willing to spend even around 150 dollars in a nightclub. More likely to come back if they were satisfied, as they want to go for something sure when coming to the city. International tourists: we will try to target the international tourists that are more similar to the local men in order to create a more consistent environment. The ones that more seem like locals are native English speakers generally coming from Australia, England, Ireland and United States. Their drinking volume is high as well and they are here in numbers compared to other tourists. 6.3 Marketing objectives Launch the product with a highly publicized event in the spring of year 1. Maintain total beverages cost below 25 % of beverage revenue. Exceed $1 million in annual sales by the third year of plan implementation. Strongly place in customer’s mind when they think where spend the night Attract even those with different styles and preferences. Build awareness out of Vancouver boundaries by year 3. 6.4 Strategic focus Highlight and insist on our brand equity when promoting the product Using the logo to place in customer’s mind, making him associate it to a different place Concentrate our resources on the opening event Build a long-term loyalty program Develop a strong risk management program Encourage customers to give feedback Keep alcoholics price as lower as possible as we know that the price-sensitive locals will tend to purchase more. Increase special events during year 2 and 3. 18 7. Marketing Mix 7.1 Product action plan The nightclub is placed on south Granville Street, then not too close to the major nightclubs on the street. It is 10,000 square foot unit, included our company’s office. The dance floor and bar will be separated from each other and will accommodate 750 people, and also the club will be furnished with 20 typical pub tables with four seats each. There will be an exclusive area halfway between the bar and the dance floor equipped with other tables, sofas and armchairs where people can drink and enjoy a more private environment, even if it won’t be a privee’(private rooms). Modern décor and a spacious layout will be the main features regarding the design: strong colors, highenergy themes depending on occasions and few columns and walls that stands in the middle. The usual theme is cubes shape everywhere on walls to let the customer absorb our logo in their mind. According to our budget, we will probably implement a special metal cover for the walls at the entrance, which became popular in U.S.A as creates falling water effects with the reflection of lights. This attracted many customers that asked what the material was made of (Nightclubs, bars & clubs by Creative Nightclubs). Ladies’ bathroom will be a luxury one if compared to the general style, as we want suit to the needs of our main target market: it will be equipped with mirrors all around the walls and a big part of the wall between the ladies and men’s bathroom will be removable, giving more toilets to girls in order to avoid long lines. At one side of the dance floor, two cubes are placed for the dancers and there are two balconies above the dance floor where the dancers will move after a certain time to leave the cubes to outgoing customers. For the moment, we have a two-floor nightclub. The initial hours of operation will be from 8pm to 3.30 pm, four nights a week; we will see how are customers will react to late closing comparing to competitors in Vancouver. We serve no food, and there is no table service; to avoid long lines at the bar, our bar tenders will serve beer at the left and other alcoholics at right. The two sections will be controlled and adapted to the kind of purchasing going. The atmosphere is totally informal, and we will encourage people to let them go and enjoy the music, as well as the DJs will do. We won’t engage with DJs who can’t handle the crowd. We will offer beer, wine and an array of liquors and mixed drinks. In addition, the venue will sell nonalcoholic beverages such as soft drinks, juices and bottled water. 19 The entrance fee will be 10 dollars. We want people to come immediately after the opening and we know that the price is a key-factor for a newly opened club. The entrance will be free for girls every Friday and Saturday from 10 pm to 11 30 pm for the first six months, than we will reduce to one weekend per month. For guys, we will provide a free drink. Also, the closet where to keep jackets and clothes will be free at all times. We plan to organize special events every month, and two or more during feast periods and summer. Theme nights, such as the bikini night and the foam party, or live performers are one of the aspect in which we aim to differentiate. At the beginning, we will engage live music performers famous in the area of Seattle and Vancouver, as well as popular YouTube performers and personalities. The nightclub will be equipped with internet connection, high-tech nightclub lighting, and lasers and led DJ lighting to create dramatic light effects. Also fog machines will be implemented. 7.1.1 Positioning and branding We believe to know our core customers, which are the locals, aged 19 to 34 years old. They are looking for a high-energy environment and new ways to have fun when going out. We will create a place for them and will adapt to their needs over the time. The Cube will be transgressive place in Vancouver, were drinks are cheap and the night is long. At early night we provide a fun environment with drinking games such as beer-pong and quizzes which involves people to get to know each other, and obviously drinking too. When midnight will come, hard music will start. It’s late for Vancouver, but this is plan is female-oriented, as we know from direct experience and from a little survey we conducted that girls like to wait or to meet people around before letting themselves go and enjoy fully. We are confident that this is going to work especially with shy people, because, if not, they will feel strangers in our high-energy and evolving environment. We are the only club in Vancouver doing that. To sum up, the place can turn from a pub-style atmosphere to a party-goers place, and not a usual one. As said earlier, dancers will move on balconies and everybody can feel free to dance on the cubes. No other club in Vancouver will perform as many special events as we will do since the first year: we will always offer the latest and the greatest. We will be superior on technology too: the Cube is a photo-sharing site, where everybody will have free internet access and photographers are ready to catch the best moments. Furthermore, we use guest list management and reservation management software that will give us better insight, increase efficiency and revenue, and ultimately lead to a better customer experience to keep them coming back for more. Also, we will invest in engaging with the best DJs in the market, whose music will reflect our style. The trend of electronic music of multiple genres is a sign of class and status in the nightclub industry. The DJ is the new rock star, so it’s worth investing in the right one to play the right music (Top 5 Trends for Nightclub Owners, 2013). Sensation and emotions go hand in hand with music, and females are really sensitive to that. We maintain that be up-to-date with the technology and in satisfying your core market are the key factors in this industry nowadays. We know that if attracting and retaining young women everybody will be happy. 20 This will be our main advantage over the competition and in order to keep it over the years we will focus our efforts in developing a successful customer loyalty program like no other club in Vancouver. Our brand will be easy to identify: the logo will be placed everywhere to build awareness of our identity. We will brand as transgressive nightclub, but even as cheap and informal place where everybody is welcome. Brand pentagon Music Price Place Pulse People 7.1.2 Product decisions The overall price of beverages and entrance, which is lower than any club in Vancouver, united to several benefits (especially for females), give us the chance to get competitive advantage and develop the basis for retaining our core customers. The up-to-date technology, with digital media presence and fast communications with the customers is another momentous feature nowadays, although several clubs are moving in this direction. After year 1, we will try to maximize our customer satisfaction: at the time our risk management and loyalty programs will be implemented and the technology needed to achieve that will be fully tested. We will be asking feedbacks during the first year and improve what is needed to satisfy the customer. Some of our employees are paid minimum wage, and we believe that within a year we should paid them more in order to obtain more enthusiasm that can influence customer service in a positive way. The employees know already this issue but they found themselves well working at the nightclub for the moment. The building will be upgraded based on particular demand: for example, we may add a floor to play different music at the same time or create private rooms. Except special events, the product won’t change much from summer to winter but, obviously, in summer customer flow will be greater and some upgrading will be done in the future. 21 Our logo is the physical evidence that will allow us to be known and to be associated with a transgressive place after promotion. The logo, a cube, will be the main design element of the décor of the walls. We want to build an artistic layout playing with reflection of lights against the walls: we are sure that in this way the logo will be imprinted in the customer’s mind. 7.1.3 Delivery decisions During year 1, we will initiate a process of selection and retention of the best customers. Our intention is not to become an exclusive club, but we maintain that having the right people with you is a key factor to develop customer loyalty, which is our main long-term objective. In this way, as well as with asking for feedbacks, we will be able to handle challenges of variability of the experience. Our policy on hiring and training will be low-price as we prefer invest on someone that have already the right basis for working at the club. If the candidate will show consistent abilities during trials and first working days we will give particular training aimed on promoting word-of-mouth and instill confidence to deal with customers. Also, we will raise the wage of every employee right away if they deserve it. We will hire for service skills and we will provide training about interacting with guests and mixing drinks. We motivate our employees by shaping their mind with the idea that there is no better club where to work, but generally we won’t hire somebody who is not motivated since the first time. Bartenders and front desk managers will be given the authority and responsibility to solve problems, as quick and effective problem resolution creates higher satisfaction and loyalty. Also, we will encourage complaints and asking for opinions, as it can be a good source of customer and market information. We absolutely don’t want that the customer leave without communicate the reason; we will insist if needed. Feedbacks will be encouraged through our website and digital media pages. Through these, the customer can register and like the page in order to receive news and incoming events information. To our VIP customers, mainly loyal females, we will send e-mail with personal advices and convenient deals. 7.2 Distribution Action Plan 7.2.1 Access “The Cube” is located on Granville street in the heart of nightlife of downtown Vancouver city. It is very easy to get to the club by car. Unfortunately, we do not provide any parking lots for our customers, but usually there are some police officers on the street during weekend, so it is secure to leave a car on the street. It is also easy to get on the bus #6, going to Davie street, because the bus stop is located half a 22 block away from “The Cube”. Moreover, our club is close to Granville skytrain station. It takes approximately from 10 to 15 minutes walking from the station. According to the fact that there are a lot of nightclubs on Granville street, we will hire people, who will be dressed up in bright clothes, to give out flyers for free entrance to the club until 11.30 p.m. Using this strategy, our staff will stand out from the staff of other clubs. We will also put a lightened dance stage in the cube shape in front of the club and some dancers will be dancing there. That’s why our club will be easy to notice and it also will help to differentiate it from others, because no one used something like this before. 7.2.2 Resellers/Intermediaries For Intermediaries, we will use online registering for the guest list that will allow our customers not just to get in the club for free during the whole night, but they will also get access to our VIP lounges that are located on the second floor. Also, if people want to get updates about events in “The Cube”, they can leave their number on our web site and they will get all the news about the parties, we organize, weekly. This service is totally secure and we won’t share this information with anyone else. 7.2.3 Partnership We have some good ideas for our partnership. Firstly, we will get an agreement with one of the restaurants or café, but not the fancy one. Probably, it will be one of the café where students usually spend their time. The idea is to spread our flyers in that café or put a small cube on each table that have to represent our club. There is also the possibility to place some stickers on the mirror in the washrooms of that particular café. Every time people will look at the mirror, they will see our advertisement. We will do exact the same thing to advertise that café in our nightclub. Next, we will try to get a partnership with a small liquor company and will try to promote their product while they will sell us their liquor half price. For example, we can put a sign with a “drink of the night” or make a sale offer for that particular drink. Also, if that company has its own brand, we can provide some small games as dices and if someone will get definite number, that person will win a small souvenir with the logo of this liquor company and others who were not that lucky, will get a small complimentary drink to try it. 7.2.4 Title Transfer As we mentioned above, we will use our web site to make the access to our club easier. There are some ways to do this. 23 First of all, it is the opportunity of the registration to a guest list that gives an access to our VIP lounges and free entrance during the whole night. Secondly, it is weekly updates about events that we are going to organize in our club. 7.3 Pricing Action Plan Before we decide on pricing in our club, we should look at some costs, the level of profit that we expect to get, our competitors’ pricing, price of our channels and what our customers expect to pay. 7.3.1 Costs Our launch cost will consist of promotion before the opening and event expanses. The idea is to give away flyers on the street during the whole day and not just during the evening time, we will also place some cubes in the main areas of the city. As for the first event related to the our opening, it is going to be massive with a lot of decorations and special effects. Our operating cost will consist of the lease payments, utility payments including gas, electricity, Wi-Fi and water. Also, it is cleaning and labor cost, including us and our staff. Moreover, we have to pay all the insurances we need for maintaining our nightclub, bank fees, liquor supplies, marketing and promotion. In addition, we have to buy some equipment such as a bar table and bar chairs, shelves and fridges to keep the liquor, sofas and tables to the VIP lounges, lightning and the most expensive is a DJ’s equipment. 7.3.2 Competitive Pricing Prices in clubs varied and it depends on status of the club. Usually, if the club is called luxury, so the price will be higher than in casual club. “The Cube” is a middle-priced nightclub, that’s why we did some research of the clubs in this area with the same strategy to figure out their pricing. From our research, we found out that the average price for the cover is from $10 to $15, the average price for drinks is six dollars and the price for coat check is from five to six dollars. 7.3.3 Consumer – level Pricing. For citizens of Vancouver, the price in the club shows its status. Unfortunately, not everyone is ready to pay a lot for one night. Usually, people want to get into a club for free, so that’s why they arrive right at the opening time with tickets for free entrance and they also try to avoid a long line-up. 24 Moreover, the price for different drinks is different. For example, it’s cheaper to buy a bottle of beer than order a cocktail or another drink. That’s why it influences people to buy beer in the clubs more than something else. Furthermore, people pay for the good atmosphere in the club, so if the club is well maintained, the cover price can be higher than usually. 7.3.4 Methods and Terms of Pricing We accept the payment on the entrance and in the bar by cash, debit or credit card. However, for the coat check, the only method of payment is by cash. We do not charge for the registration for a guest list or news update. These services are free. Moreover, if a customer has a ticket that is allowed him free entrance, so he or she doesn’t have to pay. 7.3.5 Promotional Pricing As we mentioned before, if a customer gets a ticket on the street from one of our staff, he or she can get into a club for free until 11.30 p.m. Guest list also allows people to get to the club for free, but the differences from the ticket are that a customer also gets a permission to go to our VIP lounge and he or she can enter a club for free during the whole night. According to all of these factors, the price in our club will be: Service/Product Cover Drinks Beer Cocktails Coat check Price $10 $5.5 $7 $4 7.4 Promotion 7.4.1. Groundwork 7.4.1.1. Audience Analysis We target audience is divided into two segments.(1). Local men and university –age women, both age from 19 to34. (2). Tourists. The first segment we target local men and university age- women, both from 19 to34. From our personal experience, the motivations for men to go to the club are women and beer. Local Canadian men tend to drink a lot in general .When they go to the club, they buy beer. When they try to impress women in the club, they buy more alcohol; at the same time, when they are drunk, they become 25 price insensible easily. With their drunkenness, they spend even way more money when they are persuaded for buying drinks by the women that they are attracted to. The motivations for women to go to the club are dance, have fun and enjoy being the central of attention and perhaps meet men, too. Basis on the fact that wherever has more ladies, men will be there and spend money. We target “local “men and women both with age from “19 to 34” as our primary target due to the loyalty ability, legal drinking age and their Life Stage. Residents are the one would frequently use the product and keep coming back if the product meets their need. The age from 19 to 34 is more likely at their family stage young and single. The money is used more care free. The secondary segment we target tourists. Vancouver is an amazing global destination and the world’s gateway to B.C. According to the marketing research data of tourism Vancouver, in the recent ten years, it has more than 8,000,000 visitors visited Vancouver each year. Tourism dollars play an important part on the revenue as well. http://www.tourismvancouver.com/includes/content/images/media/docs/historical_monthly_visitors .pdf When leisure tourists travel to another country, they tend to be relaxed and want to have a good time. They also become less price-sensitive. When they are in the club, they also want to socialize, mingle, and experience the local scene. They buy drinks when they are alone , when they meet someone or when they are drunk. To reach our target audiences, we use advertising, sales promotion, public relation and publicity to achieve our goal. 7.4.1.1. Internal and External Analysis Competition: Caprice Nightclub: “Caprice” promotes their space and the sound system, they plays R&B music early at the night .They offer special price for hi-ball and shots. Ladies free entrée before 11.They host events to target the young party crowed. And birthday guest list package. The Queen’s Republic: “Republic” opens 7 days in a week; they promote their drinks with different price in different days. Two room with different music from Chart, Hip Hop, to House and Electro; ladies are free at the door before 11. They also provide the birthday quest list package .They can host all kind of events to target party people. Barcelona Ultra Lounge: Barcelona promotes themselves as boutique style clubs of Las Vegas. It is a beautifully designed room. They provide VIP package Shine club Ladies are free at the door before 11pm.It was voted “Vancouver’s Sexiest Nightclub" by Flare Magazine and a "Hot Spot" by Fashion Magazine. They play hip- hop music for the main stream, target party people and Africa-Canadian or Africa – American people Venue: 26 Ladies are free before 11 pm. The music focuses on electronic music as the main stream. They target party people and also especially Asian people. Our club versus our competition: The strength for us is we are the brand new club, which provides different elements. Customers would be attracted by their curiosity. Meanwhile, we are the new club, we have the newest equipment and technology and Modern décor. Our promotion is strong. The weakness for us is we are newly club; we might lack of regular customers and have not too much market awareness. Compare the competitors, we are less experience. We lack of reliable and long –term experienced stuff to help out. 7.4.1.2. Objectives The objective with our marketing communications is: Before it launches: Build awareness: our club is an unknown brand new product to the market, the initial promotional effort we should be focus on is establishing an identity. Create Interest: customers must first recognize they have a need before they actively start to consider coming to our club. After it launches: Stimulate Demand: After building up the awareness and interest, our communication objective is encourage customers to increase the frequency of coming back to our club. Reinforce the Brand: Once consumers step into our club, we must create the strong relationship to lead the consumers becoming loyal ones. 7.4.1.4. Promotional Tool Strategy: The promotion tool we use for our club: 1. Digital media : Club website Through the club website, we can sell our image and concept to our consumers. They can easily approach us and know what to expect. Social medial: Social media is great tool for market to know the trend. A little time spent figuring out who is attending which events can help determine who your key influencers are, and which events generate the most people and the most buzz. Cell-phone advertising or messaging Nowadays in the young generation group, everybody has cell phone and everyone texts more than calling. Sending text cell phone advertisement message can be read efficiently right away. Contests: 27 With our personal experience, contests can easily draw crowd’s attention in the club. Videos: Image representing is the strongest way for audience to remember the concept in mind. 2. Advertising The Advertising we use for the club is: 3. Mass media Mass media brings public exposure. Flyers, posters Flyers and posters are easy to carry and are like a reminder. Outdoor media Outdoor media arouse the public’s attention. Public Relations and Publicity Great public relations and publicity always bring in more audience and gain more great image and revenue. 4. Sales Promotion Sales promotion always brings more crowds and according buyer’s behavior, when they sense the price is lower, they will buy it. 7.4.2. Digital Media Action Plan On our club website, we Include all the weekly music schedules, monthly special events, photo gallery and gust list program. When customers go on our website, they can easily see what music is playing in which days and what special events are happening this month. Who get photo taken in the club and how to register on our guest list program. We also create our own club Facebook page, on our page, it Includes photo gallery and recent promotion information. We provide the first hand party scene on our social networking such as twitter, Instagram…etc. And we constantly go on social media to interact with our audience through the pictures and comments. At the same time, we use cell phone message to weekly update our audience the newest news and encourage them to sign up for the guest list through the cell phone message. Meanwhile, we create videos for our special events and instantly post on our social networking page and get people to share the video as much as possible. 7.4.3. Advertising Action Plan We work with the local radio host/hostess to broadcast our special events constantly through the show. Meanwhile, we post our posters near our club location and hire university promotion girls to give out the flyers on the street on both Friday nights and Saturday nights, weekly in the university campuses; at the same time, we hang up the big TV screen running all our past special events videos and new weekly event schedule outside of our club during the night of weekends. 7.4.4. PR and Publicity Action Plan 28 Events We provide a monthly theme event to get our audience to participate. Every month we throw out a theme party and share on our social networking page, web page, flyers and our TV screen informing dress code. If people follow the dress code, the door fee is not need and in the end of the night, we will choose the best dresser and give away the big prize. We want to create an environment that is transgressive, when our customers come in, they will instantly imagine they are in a great music festival in Europe. We also make sure our music has different kind of options; we mix different type of music in one night and take care of different kind of music lovers. On the other hand, we will invite some celebrities, local performers or even people who are popular on YouTube channel to create stunts. We also host all kind of events for our customers; events can be from birthday party, theme party, wrap party to company’s anniversary party. We also hire go- go dancers to fire up the party and make sure everybody has a great experience in our club. Partnerships We will reach the local restaurants, pizza shops to exchange our flyers and posters. We will have their flyers on our information counter and posters on our bathroom doors or near the mirrors, they will have our flyers on theirs and create a promotional partnership. Also we will approach the small new established beer companies to make an offer. Our bartender will try to promote and sell the beer to get customers awareness in our club and our club gets good price offered from the beer company as our suppliers. Consumer information: We offer one free drink ticket for girls when they coat checking at the front door, as long as they leave their name, email address and their Facebook account. It helps us to maintain relationship with our audience and track who our key influencers are, and which events generate the most bodies and the most buzz Publicity We hire someone to be responsible for checking our online reputation to reinforce the positive messaging and counter the negative ones. When we receive a negative feedback, some quick action can turn an unsatisfied customer into a fervent supporter. It’s always good for us to know a sense of how people see our venue. If the results aren’t what we had in mind, at least we’ll know what needs fixing. 7.4.5. Sales Promotion Action Plan – Consumer and Trade In order to have our audiences awareness and attract their interests to come to our club before they know the quality of us. We try to reduce the door price to get more quantity of women and men to spend more money on drinks for building up the longer-term brand-loyalty. We promote free door from 10pm to 11:30 pm for the girls and if guys with tickets, they will pay half price; half price from 2 am to 3 am for people who come late. People who come after 11:30 pm until 2am with regular price get one free beer ticket. At the same time, we separate our bar area into two.one sells only beer; the other sells lady drinks. At the beer section, we promote our beer of day with cheaper price that offered by our suppliers. Before midnight, we give away premiums to the winner who signs up for the contests. For example, DJ contest, dance contest, and female bikini contest……etc. 29 We offer the elements which are fun, special and different from other competitors’ doing. We have good channel strategy to promote our product and we value our customers’ opinions and we are willing to listen and adjust. We can see our club success in the market in the future. 30 Appendix 1 Liquor-Primary License Bars, Pubs, Nightclubs, Stadiums, Theatres, Recreation and Convention Centers Any business in the hospitality, entertainment or beverage industry - including bars, pubs, lounges, nightclubs, stadiums, theatres, recreation and convention centers - may apply for a liquor-primary license. The only exceptions are businesses geared to youth (which may not be licensed to serve liquor) and private clubs (which require a liquor-primary club license.) On average it takes seven – twelve months to get a liquor-primary license. Liquor-primary establishments may apply for any hours of service between 9:00 am and 4:00 am, subject to local government and Liquor Control and Licensing Branch approval, and must also offer food and non-alcoholic beverages at reasonable prices. Minors are generally not allowed in liquorprimary establishments, unless they are working as entertainers or the establishment's primary function is not to serve liquor (it is a stadium, concert hall, train or airplane, for example). Local Government and Liquor Licensing Local governments and First Nations do not make liquor licensing decisions. The Liquor Control and Licensing Branch alone is responsible for deciding who will receive a license. However, local government and First Nations do play a significant role. The Liquor Control and Licensing Branch is required to consider specific community needs in deciding whether to issue or change a liquor license. This includes, for some license applications, asking local governments and/or First Nations to provide a resolution that considers, among other things: proposed location the person capacity of the proposed establishment (how many people the applicant plans to accommodate) the operating hours requested the views of local residents how close the proposed establishment is to other social or recreational facilities and public buildings the number of other licensed establishments in the area 31 potential traffic, noise and parking problems municipal zoning population density and trends, and impact on the community if the application is approved. Local governments may choose to opt out of this role, in which case the Liquor Control and Licensing Branch will complete the same review process. . 32 References 1. (n.d.). Retrieved from Vancouver and British Columbia Travel: http://govancouver.about.com 2. (n.d.). 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Retrieved from CTV News: http://www.ctvnews.ca/business/canada-s-inflation-rate-falls-in-october-to-0-71.1555209 9. Canadian Business News,Investing and Commentary. (n.d.). Retrieved from Financial Post: http://www.financialpost.com/index.html 10. Magazine, N. a. (2011, December 5). Bar and Nightclub Trends for 2012. Retrieved from http://www.nightclub.com/bar-management/trends-2012 11. Vancouver Nightclubs. (n.d.). Retrieved from http://www.clubzone.com/c1/vancouver/nightclubs 33