Draft Marketing Plan

Draft Marketing Plan

Name

Institution

Date

Executive Summary

Our product is to build housing frames using recycled plastic from the ocean or other sources. The main benefits of our product are that it will be a lighter and cheaper alternative to conventional methods to build housing frames. Our plastic housing frames will also be environmentally friendly because we would use plastic from landfills and pollution from the ocean to develop our products, giving us a green initiative to help sell our product.

We plan on making each frame of separate parts that can be assembled into the complete structure. This will make the product easier to transport and manufacture for mass production. We are hoping that these benefits will give us an edge over other housing frame competitors and construction companies. The primary market that we are hoping to penetrate will consist of middle to lower-income families looking for a low-cost, eco-Friendly home with enough space to live comfortably. We will market towards these individuals because our product is not meant or intended to be a luxury item. Our product will help to lower the costs of building a house and provide affordable green housing for families who need it to expand.

The first short-term goal for our product would be to make our target market aware of what we are selling and how our product can meet the needs of who we are selling this product.  Our second short-term goal would be to establish brand recognition and start a reliable reputation to secure our place in the market. For our long-term goals, we would focus on trying to expand our product into other parts of the market, giving us a larger consumer base and a larger part of the market share.

The ever-increasing pollution cases need to be addressed, a recycling process that utilizes plastics disposed of will provide a window for plastic waste to be collected and recycled back preventing effects such as chocking the earth, plastic being a persistent material the ecological and ecotoxicological effects of plastic pollution are long term (Luke,2013). The effects include the endangering of aquatic life through entanglement, ingestion, and starvation, as well as the chemical impacts that build up from the same persistent organic pollutants all harm the ecosystem. This venture, therefore, aims at killing two birds with one stone as cheaper housing will be realized, as well as persistent pollution from plastics will be minimized. The product will be ideal cheaper housing, which will be the company’s goal as well as the main product and selling point. The place will be strategically near recycling centers and along with coastal areas where sea plastics are collected, which reduced the total transportation cost for the raw materials. The pricing will be the selling point as it offers cheaper housing alternatives. The projected selling price will be 25% lower than the standard conventional costs (Goi, 2009). The promotion will b based on the ecofriendly state that the building structures will be saving the environment.

Opportunity Analysis

Competitive Review

BMC: Ready frame is a whole-house solution that makes framing better, faster, safer, and greener. You give us your plans, and we cut everything you need, just how you need it. The package ships smart-bundled, compact, pre-cut and labeled ready for the framers to assemble on the job site.

Ready Frame can be seen as our direct competitor that we need to watch out for. Their concept is really good and efficient. Our plastic frame concept is better because it is lighter, so transportation cost is lower. It will also be bundled efficiently and can also be made to measure. Plastic frames are better because they weight less than wood; they are stronger than wood; they are water-resistant and don’t erose as fast. This way, we have an advantage over a ready frame because we are cheaper and better quality.

Conceptos Plasticos: Conceptos Plasticos is an Indirect competitor because they sell a full “lego” house made from plastic to cheap areas in Colombia. They might expand and start to produce their eco-friendly plastic houses elsewhere, like Africa, India, and Asia, but till then, they are not s big threat. They are an undirect competitor because they don’t sell house frames but as an alternative a whole house that can be built from plastic lego looking pieces. They can sell this concept and idea to non-profit organizations that are looking for solutions to build houses to 3rd world countries with minimal cost. When we only sell a house frame, they sell a whole small house. Therefore they will save the organization more money, but they will get less quality. Their product still gets the same job done builds a house.

Georgia- Pacific Building products: This company was established a long time ago and has a great history providing not only house frames but all the necessary materials to build a house. Therefore they have a good advantage in their ability to fulfill all the customer’s needs, not only the house frame. They are a huge company with already established brands that customers can rely on and trust. Therefore it will be really hard to compete against them as a newcomer.

Georgia pacific’souse frame products are from wood, and therefore we have the advantage of being more eco friendly. Also, Plastic frames weigh less than original wood frames. Therefore our shipping cost is less. We are able to make made to measure and use our technology to compete against Georgia- Pacific by being more efficient. Meaning our frame is going to be faster to build and take less effort because it is not as heavy as wood. Also, our frame comes pre-cut when Georgia- Pacific does not. This is why we think we have a chance to gain some of their market share on the house frame market.

Micro-Environment

Strengths

Cheap building materials making housing cheaper makes it a selling point in which will address both the middle class and low-class members of society who are in need of better housing yet affordable housing. The availability in raw materials s a great strength as plastics have been incorporated on the day to day life for in which individuals intensely use plastics, and therefore the cost associated with securing raw materials will be the transportation cost.  Spreading environmental awareness is a great factor that will come in handy as the strength as we get the support that’s really essential from environmentally awareness campaigns. The whole process covering the application of plastics makes money as well as saves money.

Weaknesses

Product penetration in such an industry could be the reason as weak brand names such as the one I am adopting will be troublesome when penetrating the given industry—high cost structures, which is the cost that comes with the whole process of setting up a company. Poor reputation could also become a weakness for the brand as with time, the brand name becomes tainted and will suffer the loss of potential customers as reviews are negative. The company which happens to rely heavily on recycling plastics could be weakened by the lack of access to good raw materials and other resources needed while, as a new company, the access of key distribution channels could be a weakness as well.

Macro-Environment

Opportunities:

1. Many families are not able to keep up with the rising house costs and the higher cost of living. This provides us with a growing market to sell our frames too.
2. Being eco-friendly and conscious about the environment is becoming increasingly more important in both governmental policies and in consumer spending. Because our product is an eco-friendly alternative to other housing frames, this gives us a leg up when it comes to marketing to consumers in comparison to other products that may be similar to ours.
3. Companies are always looking to reduce costs in order to save money. Our product is lighter than conventional frames, and it would be easier to produce and transport to different projects. While plastics lying at the bottom of the sea might be a decent initiative to start with, the company can work with already collected plastics that pose a trouble when too many waste collection agencies and possible partnerships with waster companies can ensure a smooth supply of plastics which serves as the raw materials.

Threats:

1. A threat to our product is other companies that already have similar ideas, such as Conceptos Plasticos. Companies like these are very large and already have a large market share. Selling while having such large competition would be a challenge.
2. While the market may be heading towards being more environmentally aware and eco- friendly consumers may be slow to transition away from tried and true methods of building housing frames. Even if the market is opening up to our product, we do not know how fast our product will be welcomed or if it will find a niche at all.
3. Finding contractors who are willing to buy and use our product is also a large threat that we face. While our product may fulfill all the needs of a contractor, they may be hesitant to use a product they have never tested before.

Estimated Market Size

In 2018 In The  USA, the Wood framing market was $19 Billion. And in 2018, 93% of the homes built in the USA were wood-framed. 778,000 houses. This means by concentrating on only one state the market in size would be $380 million if 5% of these people choose our eco-friendly option this means 19 million per state lets say we do this at 25 of the states. This way, our US market has $475Million potential. Doing the same math with the houses built leaves us with 19,450 houses only in the US.

There is no set amount in dollars when it comes to building homes for the poor in 3rd world countries. It is hard to estimate, but charitable organizations are given 400 billion dollars each year. If 1% of this goes towards building houses in 3rd world countries, it makes. 4billion dollars. Let’s say 10% of these companies choose our eco-friendly solution to build houses. This means Possible 400 million in sales each year (Garcia & Robertson,2017).

Putting these two together gives us almost 1 billion of potential sales in Non-profits and us.

Sources Used:  http://eyeonhousing.org/2019/10/framing-methods-for-single-family-homes-2018/

IBIS WORLD- Wood Framing Industry in the US – Market Research Report

https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=42

The Target Market

Segmentation Analysis

Construction companies for houses

• companies that define themselves as eco-friendly and sustainable
• located in one of the 5o states in the USA
• is willing to make a multi-year contract
• Accredited company
• Companies that build more than five houses a year

Humanitarian Aid Organizations

• That builds housing.
• That wants to build sustainable and ecofriendly.
• Work in hard to get places.
• The organization that is seeking to provide housing to troubled or poverty-stricken regions of the world.

Government contractors

• Accredited
• Do work for governments that are not corrupted
• Use sustainable and eco- friendly products
• Companies that are willing to make long term contracts to work with us
• That contract ecological country
• Not contractors that work with governments that are in a boycott

Construction Companies for Houses

Geo-demographically: Construction companies who are just starting out and are looking for an easier and more eco-friendly way to produce housing frames may be interested in buying this product. We would market to construction companies that are in states where the housing market is in need of cheaper, faster, and more available options.

Psychographically: Construction companies are looking for cleaner and cheaper ways to build housing frames that reduce waste of resources and labor costs. The lighter frames would be easier to transport and build, wasting less time and resources on individual projects. We could cultivate loyal customers by showing them the innovative and eco-friendly benefits that our housing frame could provide to each company.

Behaviorally: The companies would use the products for new housing developments or even possibly other projects they are working on as our frames could be made per order. They shop by searching for the most cost-efficient way to build their projects. They would get information about our product through possible magazine feature and a marketing plan geared towards showing them the benefits of using our product. Large companies may not be as price-sensitive as smaller companies.

Lifestyle: Housing companies live their lives by building neighborhoods in bulk. Our product could fill this need because our housing frames could be made to measure delivering only the needed amount, easily transported to the location of the project, and faster to build because everything comes in premarked bundles. The ease of use and assembly would help them meet deadlines and stay within the budget for projects they are working on.

Benefits Perceived/Desired: Companies will want reliability and quality housing frames that will stand the test of time. The frames will not degrade because they are plastic and will be easy to manufacture and distribute to sellers. They provide a cost-efficient and time-efficient way to build houses, saving resources, and labor costs for the company.

Positioning Statement

Unlike other housing frame suppliers, our product provides an eco-friendly, affordable alternative to building houses.

Value Proposition

With this super-strong plastic frame, customers can afford appropriate housing size by using our easy to assemble and ultra-efficient frames at a value of 8$ per sq foot.

Customer Insights

We found through our research that people would be more interested in buying housing frames if they learned that the product was produced in an eco-friendly manner. We asked a total of 8 people to complete our survey. For the first question, all eight people responded, yes. This result could definitely be a result of bias and should not be used to represent our whole target population. However, this might also show an increase in environmental concerns. For the second question, 7 out of 8 people responded yes. This could help to indicate the high housing prices that many people are expected to pay in today’s market. For our third question, 5 out of 8 responded, yes. A plastic frame may be unsettling to people because many people perceive plastic as weak and unreliable. In order to combat this, we should have physical examples and tests to assure people of the quality of the housing frames that we are making. For the fifth question, 8 out of 8 responded, yes. Considering that the group of people that we asked questions found being eco-friendly to be important, this is not a surprise. Again I believe that this shows the increasing prevalence of being eco-friendly in the consumer’s eye.

Survey

References

Garcia, J. M., & Robertson, M. L. (2017). The future of plastics recycling. Science, 358(6365), 870-872.

Goi, C. L. (2009). A review of the marketing mix: 4Ps or more?. International journal of marketing studies, 1(1), 2.

Luke, K. (2013). 5 Steps to a New Marketing Plan. Journal of Financial Planning, 26(12), 20.