Japanese watch market overview

Japanese watch market overview Results for the fiscal year ended March 31 show that watch sales at Japans Big Three watch firms slumped for the second consecutive year as the Great Recession continued to suppress demand for mid-priced watches. Nevertheless, the watch divisions at Citizen, Seiko and Casio remained profitable. For the companies as a whole, only the Citizen Group reported a profit for year; Seiko and Casio both reported losses. Seiko In the watch divisions, the hardest hit was Seiko, maker of Seiko, Pulsar, Alba and licensed brand watches; watch sales fell 31 percent to 64.5 billion yen ($693 million) for the fiscal year. Two years ago, Seikos watch sales totaled  ¥117.2 billion. Since then, they have fallen a staggering 45%. Seiko now ranks third among the Big Three in terms of watch revenue. Seiko Holdings Corp. said operating income at its Seiko Watch Corp. subsidiary increased 38 percent to  ¥2.2 billion ($23.6 million). Unlike Citizen and Casio, Seiko Holdings issued no statement discussing the financial results. Citizen Watch and clock sales at Citizen Watch Co. fell 6.7 percent in the fiscal year to  ¥123.6 billion ($1.33 billion). Regarding the Japanese market, Citizen said in a statement that the slow recovery in consumption and other factors under prevailing economic conditions made for an exceedingly difficult sales environment especially for premium-priced products for the first three quarters of the year. Overseas, sales in Asia, particularly China, were robust and far ahead of the previous year, Citizen said. In the North American market, the largest for this business, difficult conditions continued through the first half, but gave way to a faster-than-expected market recovery in the second half and sales growth for Eco-Drive and other high value added products, Citizen said. Citizen said sales at its Bulova Corp. subsidiary in the United States dropped for the year, although Bulova posted stronger second half sales due to increased sales of mechanical watches and other differentiated prod ucts. Operating profit in Citizens watch and clock segment rose 7.1 percent to  ¥9.7 billion ($104.2 million). Casio Sales of Casio Computer Companys timepiece division fell just 2.8 percent to  ¥78.1 billion yen ($839 million). Sales of non-radio-controlled watches were affected by the harsh market environment in the first half, Casio said in a statement, but sales of radio-controlled watches were strong, particularly Casios high-value-added brands such as G-Shock, Oceanus, and Edifice. Casio does not disclose the operating income of its timepiece division. Its overall electronics segment, which includes timepieces, reported a  ¥19.9 billion loss ($213.8 million). However, Casio noted that timepieces remained highly profitable. Watches represent only a portion of the sales of all three firms. At Citizen and Casio, watches outperformed other divisions. Net sales for Citizen Holding Co. Ltd. dropped 14.9 percent to  ¥252.5 billion ($2.71 billion). Net income for the Citizen Group remained stable at  ¥3.5 billion ($37.6 million). Net sales for Casio as a whole dropped 17.4 percent to  ¥427.9 ($4.60 billion). For the year, Casio reported a loss of  ¥21.0 billion ($226.0 million). Casio said the primary cause of the loss was a sharp decline in sales of cellular phones. Net sales at Seiko Holdings Corp. increased 33% to  ¥230.7 billion ($2.48 billion). The increase, however, is due entirely to a reorganization of the Seiko Group in October that made Seiko Instruments Inc., one of the groups two major manufacturing units, a subsidiary of Seiko Holdings. SII added  ¥85.0 billion ($913.6 million) to Seiko Holdings sales. Without SII, Seiko Holding sales would have declined by 16 percent for the year. Seiko Holdings reported a net loss for the year of  ¥3.6 billion ($39 million). Big Three Watch Sales 2006-2010 (billion yen) Citizen Sales Casio Sales Seiko Sales Purpose of Marketing Plan The purpose of writing a marketing plan is to give a detailed report of our new product in the market. Starting from product attributes, finding our suitable target markets, the benefits that our target customers will get, selecting appropriate distribution channels to make our product easily accessible, studying the current situation analysis of our target markets, analysis of our competitors, and the ratio of market which they have captured.Designing a marketing mix, pricing strategies, Marketing objectives and accordingly making marketing strategies. Mission statement With in this short span of time we have gained a good word of mouth by giving better quality durable products. Innovative, modern, stylish are all descriptive traits that exemplify Integrals design. Dreams and ideals cannot be realized by means of conventional ideas and technologies. Thats why our approach to development is to set a challenging goal and tackle it from every possible perspective-until what simply cant be done gets done. We Updates you with time Company profile à ¢Ã¢â€š ¬Ã‚ ¢ Company name Bingo Watches. Marketing Plan for Power Disk Watch N$B 3 MR. Uzair Zaheer is CEO of the company. à ¢Ã¢â€š ¬Ã‚ ¢ MR. Aamir Latif is Managing Director of the company. à ¢Ã¢â€š ¬Ã‚ ¢ MR. Majid Ali is GM of the company. à ¢Ã¢â€š ¬Ã‚ ¢ MR. Arslan Khurshid is Marketing Director. à ¢Ã¢â€š ¬Ã‚ ¢ Company product name is Power Disk Watch. Status of the company Bingo started their business in 2001 from the major cities Lahore, Islamabad, Karachi and for the past five years our company has been of producing following products à ¢Ã¢â€š ¬Ã‚ ¢ wrist watches (Digital and Analog) à ¢Ã¢â€š ¬Ã‚ ¢ Fancy wall clocks (Digital and Analog) With in this short span of time we have gained a good word of mouth for our quality products which we have been producing according to the market likings. Now we are about to launch a new innovative, ground breaking, new unique product in the market which is currently not available so we are having no competitors for our new product called Power Disk Watch. Market status of the company Marketing Plan for Power Disk Watch N$B 4 Our company mainly focusing in Pakistans market, our products are being used in Pakistan. The goodwill of our products is high in the market. As a result of market survey we have a large quantity of loyal customer as well as potential costumers. There is continuous communication with the customer (promotion) to increase the quality and performance of existing products. On the basis of past experience there are good expectations with the new product Power Disk Watch. Product Attributes Leather and chain straps: This product will be available for customers in genuine leather and chain (titanium) straps depending on watch model. Mp3 player: It has a build-in MP3 music player which will be an exciting step for fun lovers of different ages. Voice recorder: Watch also has the ability to record voice messages, theres a small, very sensitive microphone at the bottom of the watch. It can be used as a spy recorder. Built-in equalizer: There is a built-in equalizer in this product which will enable the users to switch to different modes of built in equalizer for e.g. rock, soft, pop, dance, classic, flat Memory space Battery: Marketing Plan for Power Disk Watch N$B 5 Build-in 170mAH, 3.7V Hi Li-ion rechargeable battery. Depending on the model its memory space varies i.e. 128MB, 256MB, 512MB, and 1GB Night mode: When it turns dark the watch arms and buttons automatically starts glowing so one can easily operate. Weight Speed: Weight of the device is 50-80g (Varies with design and shape) and the speed is USB 1.1 (Max 5Mbps). Support bit rate: Support bit rate is 32kbps-256kbps. Light indicators: It has different indication lights to indicate charging, Mp3 player on/off. Play time: Using this watch users can play continuously for 10~12 hours. System support: Windows 98 or above. Different formats: Marketing Plan for Power Disk Watch The watch handles different formats like MP3, WMA, and WAV files for playback. Plug and play: For windows above 98 there is no need to install driver just plug and play. Steps of Marketing plan 1) Situational Analysis 1) Micro Environment 2) Macro environment Micro Environment Micro factors are the factors that directly influence our company. The main micro factors are: 1Intermediaries (Suppliers / Distributors) 2Customers 3Competitors (direct / indirect) P o te n tia l E n tra n ts S u p p lie rs B u y e rs S u b s titu te s In d u s try Macro Environment Marketing Plan for Power Disk Watch N$B 7 1)-Demograhic Environment Demography is the study of human population in terms of age, gender, household size, family life cycle, education and population age mix. Pakistan is one of the 3rd world countries with a population of 15.50 billion out of which 48% are males and 52% are females. 55% of the population involves in agriculture. The literacy rate in very low i.e. 39% and population rate is 2.3% annually. Most of the population lives in rural areas but migration rate is high. The per capital income is $480 per person annually. Lahore is one of the largest cities of Pakistan. The target of our watch is young generation aging from 20-35 but still watch is being used by guys as well. 2)-Economic Environment In third world countries, a large part of the income of people is spent on the basic needs, so its the most sensitive environment where the income level is low, middle class is shrinking, wealth distribution is unequal and saving rate is low. The people are either very rich or very poor. And their consumption behavior varies accordingly. 3)-Technological environment In Pakistan, there are less opportunities of innovation are available due to the lack of research. However it also depends on the companies that how much they prefer the research and customer feedback. Keeping in view the target market, our company has to look for opportunities rather then wait for them. 4)-Geographical Environment The population level is high crossing 160 million. The growth rate of the customer is expected to have an increasing trend. 5)-Social cultural Environment Traditionally youngsters have more interest in music. This means more consumption of watches then from older ones. Marketing Plan for Power Disk Watch N$B 8 6)-Legal and Political Environment There are no restrictions for the new entrants. Govt. is supporting us by providing exemption of sales tax for 2 years to show their commitment towards welcoming new investment. Factors influencing consumer buying behavior There are many factors that influence the consumer buying behavior directly. These factors are: 1. Cultural factors 2. Social factors 3. Personal factors 4. Psychological factors Cultural factors As far as we are concerned we will target Lahore market at first. The people living in Lahore are good looking and they spent major part of their income in shopping. When we talk about watch many customers are not really satisfied with their existing watches. Thats where we are focusing at: Social Factors Some people get inspiration from reference groups and they use the same products as their reference groups are using. Personal Factors Age factor affects the consumer buying behavior. Mostly young generation use watches to improve their outlook. Economic conditions have also a bit effect on consumer buying behavior. People with high income never hesitate to spend the money on taking care of their out look. Marketing Plan for Power Disk Watch N$B 9 Competitive Factor There are basically three types of competition 1. Brand competition 2. Form competition 3. Generic competition Brand competitors By brand competition we mean competition between different manufacturers who satisfy or tend to satisfy similar need by providing Similar product. In our case our direct brand competitors are 1. Rolex 2. Casio 3. Swatch 4. Raymonds well Form competitors By form competitors we mean the competition between manufacturers which will satisfy the same need but the products that they offer are different. Our form competitors are 1. Rado 2. Titan Generic competition Competition among products that are different, but solve the same problem or provide the same benefit or utility. 2) Marketing Objectives Marketing Plan for Power Disk Watch N$B 10 There are two types of marketing objectives which are given below 1. Short term objectives 2. Long term objectives Short term objectives: The fundamental objective of BINGO WATCHES to increase the sales volume of power disk watches. Create a good image of our product in the mind of customers. Our main concern is profitability. Long term Objectives: BINGOS long term objectives are à ¢Ã¢â€š ¬Ã‚ ¢ Retention of our loyal customer à ¢Ã¢â€š ¬Ã‚ ¢ Capturing high market share à ¢Ã¢â€š ¬Ã‚ ¢ Delivering quality products to our customers à ¢Ã¢â€š ¬Ã‚ ¢ Capturing the potential target market of Pakistan à ¢Ã¢â€š ¬Ã‚ ¢ Launching innovative changes for our product à ¢Ã¢â€š ¬Ã‚ ¢ Creating brand awareness and brand loyalty 3) Market Segmentation Marketing Plan for Power Disk Watch N$B 11 Geographical region: Our target market geographical region profile is as follows. o World region: o Asia o Country: o Pakistan o City: o Lahore o Areas: o Defence o Cantonment o Cavalry Ground o Gulberg o Modeltown Marketing Plan for Power Disk Watch N$B 12 Demographic factors: à ¢Ã¢â€š ¬Ã‚ ¢ Age: o 20+ à ¢Ã¢â€š ¬Ã‚ ¢ Gender: o Male à ¢Ã¢â€š ¬Ã‚ ¢ Family life-cycle: o Young or aged can be single or married à ¢Ã¢â€š ¬Ã‚ ¢ Income: o Rs 30,000+ à ¢Ã¢â€š ¬Ã‚ ¢ Occupation: o Student o Doctors o Engineers o Computer Eng o Business Man o Accountants à ¢Ã¢â€š ¬Ã‚ ¢ Education: o Bachelors o Masters o PHD Psychographic: à ¢Ã¢â€š ¬Ã‚ ¢ Social Class: o Upper Lower o Upper Middle o Upper Upper à ¢Ã¢â€š ¬Ã‚ ¢ Life Style: o Achievers à ¢Ã¢â€š ¬Ã‚ ¢ Personality: Marketing Plan for Power Disk Watch N$B 13 o Expressive o Stylish o Authoritarian o Gregarious Behavioral: à ¢Ã¢â€š ¬Ã‚ ¢ Occasion: o Regular occasion à ¢Ã¢â€š ¬Ã‚ ¢ Benefits: o Quality o Uniqueness o Technical o Portability à ¢Ã¢â€š ¬Ã‚ ¢ User status: o Medium and heavy à ¢Ã¢â€š ¬Ã‚ ¢ Readiness stage: o Un-aware 4) Target Market This watch is designed for students, executives, professionals with different occupation, degrees and education levels. We have designed and customized according to different user needs. Students: For students we have designed a model called G-SHOCK as mentioned earlier our watches are for expressive people who want to express them selves, so G-SHOCK has Marketing Plan for Power Disk Watch N$B 14 been designed according to latest styles , fashion make it an unique and an expressive watch apart from its features. Memory space: (128MB~512Mb) This feature is really beneficial one because students can carry their assignments, presentation, work, software, related stuff on it and can access it form any where no need to open your mail account and download your required stuff . Instead of wasting so much time just copy it in your watch and carry it any where you want. Portability: This is a portable device which is always on your hand in the form of watch; its easy to carry because it weighs almost equal to watch. So at one space one carry four additional accessories. Entertainment: Mp3 Player: Students mostly have walk mans, CD man with them which they often use while traveling mostly. Now you dont need to have any walk man because you can store almost about 500 songs in your watch and can listen them when ever you want. You are traveling, sitting alone and feeling bore, or want to listen song at night time but can not put your deck on, our watch has solution for every problem Voice recorder: It is very help full during the lecture because you can record your lecture any time and can listen to it after wards and even can store it in your Pc. Privacy: Our product will be providing privacy by keeping the personal private things with you in your watch and can carry them with you all the time. Executives/Professionals: The watch which we have designed for professionals isEst eem.it varies in design according to varying age groups .we have given some new designs to this product which is a bit different from others. The benefits we will be giving to our customers are as follows. Marketing Plan for Power Disk Watch N$B 15 Memory Space: (512 MB~1 GB) Now days every professional has a need of flash drive. We have made this job easier for them to carry it in their watch and can access it from any where we are providing sample of space i.e. 512 MB ~ 1GB software engineers, programmers ,Doctors ,Accountants especially can bring some extra out put from this product because they can carry many of the big software with them. Portable: Our product makes it easier for you to carry your data in a portable device requiring no new space Stylish designs: Our watches along with technical aspects have stylish features according to current fashion. The power disk watch for executives has, attracting, exclusive, designs our targeted customers which give them an expressive look. Voice recorder: Power disk has introduced this feature for the first time in current market; this feature is of great use we have made a small product which carries multiple functions in it this feature enables you to: Record all conversation while in meeting. While interviewing some one can record the interview instead of writing it down and saving time. Privacy: It keeps your privacy with you .one can carry some of its important files, documents save in his/her watch. 5) Marketing mix 1. Product 2. Price 3. Place 4. Promotion Marketing Plan for Power Disk Watch N$B 16 PRODUCTS:- As we have already discussed about the product, its features and its attributes above. So now we will be looking at the other three Ps. PRICE:- PRICING STRATEGY:- The pricing strategy portion of the marketing plan involves determining how we will price our product or service; the price we charge has to be competitive but still allow us to make a reasonable profit. The keyword here is reasonable; we can charge any price we want to, but for every product or service theres a limit to how much the consumer is willing to pay. Our pricing strategy needs to take this consumer threshold into account. We set our prices by examining how much it costs us to produce the product or service and adding a fair price for the benefits that the customer will enjoy. We may find it useful to conduct a Breakeven Analysis. In break even analysis the price is set to break even on the costs of making and marketing a product or in other words setting a price to make a target profit. These are some pricing strategies 1. Cost based pricing 2. Value based pricing 3. Competition based pricing Cost based pricing: Cost based pricing involves adding a markup to the cost of the product. But Power disk is not dealing in price sensitive market . So we move on to the next pricing method. VALUE BASED PRICING: In value based pricing price is based on the buyers perception of value rather than on the sellers cost. An increasing number of companies are basing their prices on the products perceived value. And we can use it here as well as the consumers already dont have an image of this new product in mind so there is a need to base its new price on its value. All the Marketing Plan for Power Disk Watch N$B 17 company needs to do is to change the view point of the customers by powerful and attractive advertising. COMPETITION BASED PRICING Setting prices based on the prices the competitors charge for similar products is called competition based pricing. Consumers will base their judgments of a products value on the prices that competitors charge for similar products. One form of competition based pricing is going rate pricing in which a firm bases its prices largely on competitors prices, with less attention paid to its own costs or to demand. The firm might charge the same as, more than or less than its major competitors. But as we know that Power disk is not facing any competition so this strategy is not be used by the company. We are launching a new unique product for a special class of people our target market is not price sensitive so we will be using Value Based Pricing because we processes a good word of mouth and this type we are launching an innovative product which already does not exist in market The final user end prices are as follows for its 2 models: o G-Force (for Students) G-Force Models Quantity Per unit cost Profit Retail price Gf-910 01 4125 1375(25%) 5500 Gf-610 01 4875 1625(25%) 6500 o Esteem: (for executives and professionals) Esteem Models Quantity Per unit cost Profit Retail price Em-121001 6800 1700(20%) 8500 Em-345001 13600 3400(20%) 17000 Marketing Plan for Power Disk Watch N$B 18 Incentives: The incentives which will be given to and retailers are as follows: Retailers: To retailers the incentive given for the per unit sale of G-force and Esteem is as follows: Model Quantity Commission G-force 1 500 Esteem 1 900 PLACE:- It includes marketing channels and channel levels as described below:- MARKETING CHANNELS Few producers sell their goods directly to final users. Instead most use intermediaries to bring their products to market. They try to forget a marketing channel or distribution channel, a set of interdependent organizations involved in the process of making a product or service available for use or consumption by the consumer or business user. There are basically two marketing channels:- Direct marketing channel:- A marketing channel that has no intermediary levels. Indirect marketing channel: Marketing Plan for Power Disk Watch N$B 19 Channel containing one or more intermediary levels. We Implement Direct channels: Company Owned Shop: The products will be available on our company outlet at MM ALAM ROAD and Defence Y-Block. In- Direct channels: It would be difficult to cover our target market by just using direct channel so in order to make it easily available we will use the maximum no of efficient indirect channels, which are as follows: 1. H karim bukhsh outlets 2. pot puri outlets 3. Al Fetah outlets 4. sketchers outlets 5. Nike outlets 6. Pace shopping mall 7. Fortress market PROMOTION Promotion means customer communication that how we can reach to our customer to read and capture his mind. PROMOTION MIX STRETAGES:- Marketers can choose from two basic promotion mix strategies:- 1). Push strategy 2). Pull strategy PUSH STRATEGY:- Marketing Plan for Power Disk Watch N$B 20 A promotion strategy that calls for using the sales force and trade promotion to push the product through channels is called push strategy. The producer promotes the product to wholesalers the wholesalers promotes to retailers, and the retailer promotes to consumers. A push strategy involves pushing the product through distribution channels to final consumers. The producer directs its marketing activities (primarily personal selling and trade promotion) toward channel members to induce them to carry the product and to promote it to final consumer. PULL STRATEGY:- A promotion strategy that calls for spending a lot on advertising and consumer promotion to build up consumer demand is called pull strategy. If the strategy is successful, consumers will ask their retailers for the product, the retailers will ask the wholesalers, and the wholesalers will ask the producers. Using a pull strategy, the producer directs its marketing activities (primarily advertising and consumer promotion) toward final consumers to induce them to buy the product. If the pull strategy is effective, consumers will then demand the product from channel members, who will in turn demand from producers. Thus, under a pull strategy, consumer demand pulls the product through the channels. OUR APPROACH As we are launching our product (watches) so we will use the mix strategies to improve the customer demand to have more sales and better supply in all kinds of markets and stores. And for this we have to analyze trends or behaviors of the consumers so that the companys ability to do business can be improved. So in this section well also give the tools we will be using for this launch. We will also discuss the promotion strategy that we will be using in this launch. Promotion tools Advertisement Advertisement is the tool to make the product known to the customer, the advertisement should be in such a manner so that it can attract the customer at first glance then their should be image retention in the mind of customer. Continuous advertisement stimulates the customer for the purchasing of the product. Advertisement tools used are Marketing Plan for Power Disk Watch N$B 21 Magazines 1. Libas Magazine 2. MAG 3. Times Magazine 4. Visag Magzine 5. Fashion Magzine Sign boards Advertisement through signboards in posh areas of Lahore. For the evaluation of the product performance following methods will be used so that if the customer is facing any problems in respect of quality, availability and other matters can be removed. Feed back form Forms having different question about the product performance, its weaknesses (if any), Need for quality improvement and other questions regarding service approachability, affordability etc will be available. Forms will be given to the customers at time of purchase. Sales Promotion and retention of loyal customers For sales promotion at different occasions like EID, Independence day, greeting cards will be sent in order to stay in contact with our loyally and potential customers. 6) Implementation Marketing Plan for Power Disk Watch N$B 22 It is the most important step of the marketing plan. In this step we actually implement what we have consider In above steps. Because there is a saying that it is useless to write a story if you are not going to make a movie. 7) Evaluation In this we evaluate what we have implemented if our strategies are going accordingly then we carry on other wise we are going for modification. Marketing Plan for Power Disk Watch N$B 23