E-commerce Retailer Marketing Plan

Nature's Candy

Marketing Strategy

Nature's Candy is focused on the merging/redefined Internet marketplace. The users will be Baby Boomers, which represent approximately 50% of the discretionary income currently in the United States. They are looking for proactive, non-invasive, and non-pharmaceutical ways to stay healthy as they age. Nature's Candy can bring these people cutting-edge products coupled with convenience and service.

The long-range goal of Nature's Candy is to not only dominate the naturopathic and homeopathic supplement market, but to also create an icon brand. Initially, the company will:

• Engage in Web-based marketing for the next year to generate awareness of the company and product information. Because Internet-based advertising has declined in recent quarters, the prices for advertising have consequently significantly dropped making the expenditure more cost effective.
• Engage in outdoor advertising providing general awareness to the public at large and direct individuals to the company's website.

Mission

Nature's Candy's mission is to provide the finest in natural supplements using the Internet to lower the consumer's cost. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.

Marketing Objectives

• Increase repeat customers by 7% per quarter.
• Decrease customer acquisition costs by 8% per year.
• Maintain positive, steady growth each month.
  

Financial Objectives

• Pro-forma profitability by year three.
• Decrease variable costs by 2% a year.
• Profitability on 99% of the listed items, no lost leaders.
  

Target Markets

A significant trend in America and abroad is that people are taking a more proactive interest in their health. This is exemplified by the increase of health clubs and health club memberships. People are looking to avoid invasive surgery and powerful pharmaceuticals; instead people are taking an active role in the maintenance of their health and practicing preventive medicine. Naturopathic medicine promotes the diagnosis, treatment, and prevention of human disorders through the use of non-invasive, non-pharmaceutical products and practices. In 1993, the United States government recognized this trend when it established the Office of Alternative Medicine.

Besides the general development of naturopathic medicine, the aging of the American population is a significant trend driving the use of naturopathic and homeopathic health supplements. The Baby Boomers are now reaching middle age and their mortality is becoming a focus. This demographic segment, which is comprised of 80 million people, represents over 50% of our county's discretionary income. It is reasonable to believe that this wealthy market segment will continue to grow the sales of naturopathic products.

Another global trend is the emergence and popularity of e-commerce. Brand-focused Web retailers that can provide good products, customer service, information, and the intangible, emotional buy-in by the customer are becoming hugely successful. E-commerce retailers have an advantage in that "Unlike traditional retailers, Web-based sellers are not slowed by the friction of store growth and local marketing" (J.W. Gurley, Fortune, 1/11/00). In addition, e-commerce companies do not have the excessive overhead of a traditional brick and mortar retailer. As seen by the recent success of Amazon.com and Gap.com, consumers are comfortable buying online and will pay for convenience. Experts predict Web sales to grow to $12 billion by 2003.

The recent Internet crash was based on too easy access to capital invested into retailers and other dotcoms without reasonable business plans or revenue models. Regardless of the recent fallout, the Internet is a very efficient marketing and distribution model, that if done right, significantly decreases costs of serving the consumer.

Positioning

Nature's Candy will position themselves as a one-stop Internet purveyor of high-quality, reasonably-priced supplements.  NC will leverage its competitive edges to achieve the desired positioning:

• Nature's Candy's competitive edge will be its easy to use website and superior customer service. The website design will be a competitive advantage because research indicates that an easy-to-use website significantly increases sales. Too often sales are lost because of complex websites that are far from intuitive.
• Nature's Candy's other competitive edge is superior customer service.  The mantra of the customer service department is to serve the customer in any way required. Customers that call in with problem/issues will be amazed at the amount of personal attention they receive, and how quickly issues are not only resolved but significantly improved. Superior customer service will be a powerful asset.
  

Strategies

The single objective is to position NC as the premier retailer of naturopathic and homeopathic nutritional supplements. The marketing strategy will first seek to create customer awareness regarding the products offered, grow the customer base, and work toward building customer loyalty and referrals.  The long-range goal is to not only dominate the homeopathic supplement market, but to create an icon brand.  Initially the company will:

• Engage in Web-based marketing for the next year to generate awareness of the company and product information. Because Internet-based advertising has declined in recent quarters, the prices for advertising have consequently significantly dropped making the expenditure more cost effective.
• Utilize outdoor advertising, providing general awareness to the public at large and direct individuals to the company's website.

Marketing Mix

Nature's Candy's marketing mix is comprised of the following approaches to pricing, distribution, advertising and promotion, and customer service.

• Pricing: The pricing structure will slightly undercut the national brands. NC is able to do this by leveraging its efficient business model as well as using private label manufacturing.
• Distribution: All products will be distributed through its warehouse, accessed via the website, and delivered throughout this country as well as internationally.
• Advertising and Promotion: Internet-based marketing as well as outdoor ads will be used.
• Customer Service: L.L. Bean and Amazon.com have been benchmarked as industry models.  It is NC's goal to reach the same level of service as the benchmarked companies.
  

Marketing Research

NC conducted several different focus groups to collect valuable market research prior to undertaking this large project. The focus group participants were comprised of dissimilar individuals. Some of the participants were the ideal targeted customer, while others were individuals who might have an inclination to purchasing supplements and might have an inclination to purchasing from an Internet vendor.

The information gathered from the focus groups, both from the natural customers as well as the tentative ones was invaluable. When working so hard on a single project for a long period of time it is often difficult to see things from multi-perspectives. The collected research had a positive, profound effect on the entire project and it is believed that NC will be far more successful as a result of this market research.