With today’s saturated market and the desire to fulfill the surge in consumer demand, it became apparent that moving abroad in foreign investment undoubtedly offers the possibility of boundless growth and prosperity. As said phenomenon also suggests that international expansion increase target market and widen companies’ resources will likely favor sales, profits and brand recognition. The overseas market chosen is Australia; the first outlet will be located in Sydney near the CBD district.
Judging from the Situation Analysis, Australia is an ideal platform to start on small and medium enterprise and due to its surge in demand for health and wellness industry. Therefore Amore will be able to meet the demands of Australians as they seek for beauty, health and wellness. Amore stands out from its competitors due to its wide range of services and products readily available, and most importantly, Amore specially caters for the females. The customer target segment for Amore in Australia is the modern, sophisticated new-age working women with high spending power.
This report will show the marketing and implementation plan of Amore to exploit its opportunities entry into Singapore market. Through environmental analysis, such as the political, economic, cultural, technological, environmental and legal aspects, there is a clear background about the external factors of the business and the environment operating in Australia. The report also sets the direction, by looking at Amore’s strengths, and weaknesses; and also in the view of its opportunities and threats relevant to the external environment in development and then decides on strategies to counter its threats and makes use of its opportunities.
In addition, market segmentation conducted with the aid of geographic, demographic and psychographic data help in tailoring Amore’s products and services. Next, with the marketing objectives set for Amore in the first three years, implementation of 4P’s marketing mix strategy will assist further development and improvement to achieve the objectives. Lastly, project timeline is monitored for budget allocation, monitoring and control to reduce the perceived risk of overseas investment. 2. Background Description
In 1985, Amore Fitness was established and is Singapore’s leading fitness and spa service provider. Also, it is an award winning company whereby they are committed in promoting and encouraging the publics to achieve a much more healthier lifestyle with the help of Amore. Furthermore, Amore Fitness provides world-class services where high quality gym equipments are used to enhance the whole workout experience with an affordable price. Amore Fitness provides highly qualified instructors with ample experience to serve their customers at its best.
Furthermore, Amore fitness has 17 fitness centers and spa clubs located island-wide today, and has over 300 fitness classes commencing every week to select from. Amore came up with a boutique spa, where quality standards, brilliant service and also professionalism are provided to the customers. Amore Define is one of the luxurious spa to pamper the customers cater for both men and women (Amore Fitness Pte Ltd 2011). Amore Fitness popularity among women has increase rapidly as women today pay extra attention to their health and also their figure.
Thus Amore Fitness takes advantage of it to invent a list of series to attract women and encourage them to be more pro-active approach to their new lifestyle. In addition to that, Amore Fitness is proud to collaborate with the Singapore Sports Council in bringing forward the Women’s Day Out (WDO). It is the largest annual women’s sporting event held locally in Singapore. Amore focuses on unique business strength in both fitness and holistic spa to meet the customers’ needs today (Amore Fitness Pte Ltd 2011). 3. Corporate Vision More than I am” for total wellness as Amore is more than fitness and health. It is a way of life. Through the journey of discovering more, be inspired and inspire others while making a difference to people around you as you find fulfillment towards your goal (Amore Fitness Pte Ltd 2011). 3. 1 Mission Statement Singapore’s leading fitness and spa service provider committed to promote and encourage members of the public to attain a healthier lifestyle through a holistic approach for fitness and well being (Amore Fitness Pte Ltd 2011). . 2 Corporate Goals Amore will continue its focus on the unique dual business strengths in fitness and holistic spa to provide a complete wellness experience to answer the needs of patrons today. They can look forward to experiencing a wide range of offerings to improve their overall well being in a personable, genuine and conducive environment. Amore will continue to provide the public with service excellence and the motivation to stay fit and healthy (Amore Fitness Pte Ltd 2011). 4. Environmental Analysis
In order to penetrate into the Australia’s market, Amore would have to take into consideration of the macro environment, which will greatly affect the strategies used in the marketing mix strategy in the later part of the report. Hence the environmental analysis act as a guide to assist Amore in understanding the six factors; political, economic, sociological, technological, legal and environmental. 4. 1 Political Amore must deal with the unfamiliar political system when going international; they have to understand the governing system of Singapore, the political risk and stability as well as government interventions.
Political System Australia is a federation of six states and two territories. Under the written Constitution, which came into force on I January 1901 when the colonies joined to form the Commonwealth of Australia, the Federal government is mainly responsible for the national economy and Reserve Bank, customs and excise, immigration, defense, foreign policy and the postal system. The state governments are chiefly responsible for health, education, housing, transport and justice. There are both federal and state police forces. Political Risk and Stability Australia is a safe destination for investment.
The country’s political and regulatory environment is stable, open and progressive, providing investors and interested companies with a high degree of confidence and certainty. Australia’s strength as an investment destination stems, in part, from a political system that has been assessed as being highly effective in responding to economic challenges and policy direction. The adaptability of Australian government policy to changes in the economy has been ranked in the top two countries in the region. Similarly, the transparency and effectiveness of government are also rated highly (Australian Government n. . ). It has strong economic and cultural ties with Asia, a highly skilled work force, and competitive infrastructure. Most importantly, it is supported by a stable political environment, accompanied by an enviable lifestyle (Australian Government n. d. ). Government Transparency With the livelihoods of so many at stake, governments’ commitments to anti-corruption, transparency and accountability must speak through their actions. Hence, good governance is an essential part of the solution to the global policy challenges governments face today (Transparency International Anti-Corruption Center 2010).
Australia is ranked the third in the Corruption Perceptions Index (CPI) regionally, with a score of 8. 7 in the CPI 2010 (Corruption Perceptions Index 2010 2010). It evidently shows that Australia is politically safe enough for Amore to invest in Australia without making any unnecessary losses. 4. 2 Economic Economies around the world have been confronted with the most challenging global financial and economic conditions in 75 years. Australia was the only advanced economy to have reported positive through-the-year growth in the midst of the crisis (Australian Government 2010).
Australia’s unemployment rate is also lower than nearly all major advanced economies (See Fig. 1) and labor market has fared better since the onset of the crisis (See Fig. 2). Strong fundamentals enabled consumer confidence to recover quickly (See Fig. 3) and business confidence has quickly rebounded back above pre-crisis levels (Australian Government 2010). Australia’s economy has benefited from a resilient export sector, supported by demand from Asia. Hence, Australia’s economy remained strong during the global crisis and is well positioned for future growth.
Australia’s strong economic position is founded on preserving the balance between a solid legal and regulatory foundation and an environment that promotes enterprise. On top of that, Australia’s strong public finances and sound financial system proved to be among the most successful in the world, as evidenced by Australia’s relatively strong performance through the global crisis (Australian Government 2010). Gross Domestic Product (GDP) The Australian economy GDP climbed 0. 9% from a revised 0. 3% in the third quarter. The economy grew 2. 7% from a year earlier (See Table 1).
This is the fastest pace in almost two years in the final quarter of 2009. According to a National Australia Bank Ltd. survey of 580 companies between February 22 and February 26, the confidence index gained 4 points to 19, matching November’s seven-year high. And manufacturing expanded at the fastest pace in more than two years in February (UOB Economic Treasury Research Quarterly Global Outlook 2Q2010 2010). From Table 1, the growth of GDP shows a booming economic, symbolizing higher purchasing power. In turn, people consume more. Interest Rates
The benchmark interest rate in Australia was last reported at 4. 75 percent. In Australia, interest rates decisions are taken by the Reserve Bank of Australia’s Board. From 1990 until 2010, Australia’s average interest rate was 5. 81 percent reaching an historical high of 17. 50 percent in January of 1990 and a record low of 3. 00 percent in April of 2009. This page includes: Australia Interest Rate chart, historical data and news (RBA, T. 2011). From Table 2 (See Table 2), it is shown that the interest rates are relatively similar across the year of 2010, and there is a growth from the year 2009.
This shows that the interest rates are rather stable hence Amore would not experience huge jumps in the changes of prices. Income Employment growth has been very strong over the past year, though some leading indicators suggest a more moderate pace of expansion in the period ahead. After the significant decline last year, growth in wages has picked up somewhat, as had been expected. Some further increase is likely over the coming year (RBA, T. 2011). 4. 3 Social The population of Australia is estimated to be 22,548,995 as of 1 February 2011, of which 18. % of them are between 0-14years of age with a sex ratio of 1. 05 male(s)/female, 67. 9% between 15-64 years of age with a sex ratio of 1. 03 male(s)/female, and 13. 5% between 65 years old and over with a sex ratio of 0. 84 male(s)/female. The median age is 37. 3 years of age (CIA Factbook 2011). Of the population, 25. 8% are Catholic, 35. 5% are Christians, 2. 1% are Buddhists, 1. 7% are Muslims and others. Languages spoken are mainly English (78. 5%), Chinese (2. 5%), Italian (1. 6%), Greek (1. 3%), Arabic (1. 2%), Vietnamese (1%), and others (8. 2%).
Lastly, the literacy level is 99% (CIA Factbook 2011). Hence Amore will have no problems with languages and religions with advertising. Australians are generally not superstitious therefore colors is not as important as compared to superstitious countries like Hong Kong. There are relatively as many females as males, therefore Amore will definitely have enough market to target at. 4. 4 Technological Australia has Internet hosts of 13. 361 million, with country comparison to the world of 8. There are 15. 81 million Internet users in Australia, with country comparison of 25 to the world (CIA Factbook 2011).
This shows that Australians do use the Internet. However the ranking is pulled down due to the suburbs and rural areas of Australia. There is a total of 37,855km of railways, with a country comparison to the world of 7, and a total of 812,972km of roadways, ranking 9th to the world (CIA Factbook 2011). This shows that transportation is not a problem in Australia even though the country is big. With the advanced technology and number of transportations available to Australians, Amore would not have to worry about the distribution in different states and the crowd that will visit them. 4. Environmental In Australia and internationally, there has been an increasing focus on the issue of climate change, biodiversity, pollution, ozone layer protection and protection of sea lines. Tasmania is one of the world’s major suppliers of licit opiate products. Government maintains strict controls over areas of opium poppy cultivation and output of poppy straw concentrate. Therefore Amore should seize this opportunity and come up with ‘eco-friendly’ or ‘green’ services that will attract customers who are environmentally aware such as the usage of organic products in their spa services. . 6 Legal Australia also has an open, efficient and transparent legal framework. Corruption levels are judged lower than those in the US, the UK, Canada and most regional countries. These results can be attributed to a strong system of checks and balances, and a highly respected judicial and law enforcement system (Australian Government n. d. ). Australia has an effective, transparent and reliable regulatory system that provide a stable framework in which business can plan with confidence and compete on an even playing field (Australian Government n. . ). 5. Competitive Audit The three main competitors of Amore are Newton Town Gym, Fitness Choice and Headquarters. These three corporations offer similar services; they target the same segment of modern consumers who are from the middle class to high class. However, Amore targets only at females (Refer to Competitive Audit below). Existing Competitors | Core Products| Facilitating Products| Strengths| Weaknesses| Newton Town Gym| * Fully equipped weights area in gyms, computerized cardio machines, infrared sauna. Over 50 classes a week with competitive charging and free registration. | * Fitness assessments and Programs included in memberships longer than 3 months. * Physiofirst and Childminding services available. | * Wide array of facilities * Over 50 classes a week in three studios. * Wide range of equipments and machines. * Childmind and Physiofirst * Qualified trainers and Chinese herb practitioner. | * Only available in Sydney * Expensive * Too ‘gym-focused’| Fitness Choice | * A trusted dealer of quality fitness & gym equipment for many years. * A hire-try-buy option, so customers can try the equipment out first, before committing to a purchase. | * Retail outlets in Melbourne and Sydney * Stock leading brands of equipments * Hiring of equipments services before purchasing * Deliver to doorstep * Hire over phone or phone| * Expensive * No trainer supervision * It is not a fitness centre compared to the others| Headquarters| * Provides gym facilities and group fitness classes with personalized fitness assessments and programming. * Known for its quality service and friendly staffs * Computerized equipment| * Offers massage services at the Sydney CBD centres to help relieve stress and tension. * Equipments are well maintained * Olympic standard free weights, dumbbells and barbells suitable for everyone. * The pin-loaded machines are very user friendly and easy to adjust. | * Classes offered are too masculine * Only available in Sydney * Closed to all public transport * Little variety * Not opened on weekends| 6. SWOT Analysis
STRENGTHS * An award winning company and Singapore’s leading fitness centre and spa provider * Strong and reputable image in the market * An unique dual business strength * A one-stop fitness and wellness centre for the ladies * Strong financial support * Low operating costs in Australia * Strong economy and legal system to support * Wide range of services for females * Provides world-class standard at affordable prices * Qualified and experienced instructors * Quality equipments and excellent service * Being the first fitness and wellness centre only for females| WEAKNESSES * A fitness centre not meant for men * No experiences in the overseas markets * Amore has only been working with the Asian women * Might face difficulties in the overseas market * No brand awareness in Australia’s market| OPPORTUNITIES * Collaborating Health Promotion Boards in Australia and host events that promote women’s health * Exposure to a bigger market in Australia * Distributing own qualified instructors or managers over to Australia to manage the business and train them at the same time * Expanding the business to even more overseas markets| THREATS * Emerging competitors in the industry in Australia * Higher labor cost * Might be unfamiliar for Australians to want to try Amore’s packages * Risk taking involve * Financial status – Australians might not want to pay so much for the packages in Amore| 6. 1 Implications Based on the SWOT table above, Amore has formed a strong and reputable image locally especially, with the ladies. Amore’s unique dual business in fitness and spa is a success; it has helped the company in gaining recognition from the public and achieving many awards. Besides in running business, Amore had also collaborated with Singapore Sport Council in running an annual event AWDO for the ladies.
With all these successful experiences, Amore creates remarkable milestones each year. With the strength of Amore, there are many opportunities that Amore could explore internationally. Australia will be a potential ground for Amore to enter where, people are increasingly conscious about their health and wellness. Based on one of the Australia government website, Better Health Channel, Australia’s obesity rate has doubled over the past 20 years, and it is commonly seen in women than men. It will be a good opportunity for Amore to extend their business in to Australia. This could mark another milestone of Amore. However, there are various concerns in extending the business into the Australia market.
For many years, Amore has been working with the Asian ladies in Singapore. Thus, Amore might face with difficulties in handling the ladies in Australia. This is because there are differences between the Asian and Western cultures. Another concern would be the unfamiliarity within the market; Australian females might require time and effort to know Amore before visiting Amore, depending on their level of uncertainty avoidance. Amore would have to take some risk in extending the business overseas. In addition, the labor costs in Australia is higher than Singapore, and Australians might not want to spend too much of their income on a fitness or wellness package.
In order to solve all these concerns, Amore has to invest a lot into doing research and development such as market research on the habits of female Australians, their perceptions about health and wellness, and how much of their disposable income they are willing to spend on fitness packages. Every business requires investment, doing the right investment generates more profit. In this case, health and wellness is needed in Australia and the level of barrier to enter in is low. In addition, Australia encourages trade between the Asian countries. (Fletcher and Brown 2008, 25) The move in entering into the overseas market required great risk but it will bring Amore up to another level in their business. 7. Marketing Objectives The recommended marketing objectives are set within the timeframe of 36 months duration. However, only the first 12 months objectives will be taken into consideration in this report. Year| Objectives|
ONE| * Opening Amore’s 1st subsidiary outlet in Sydney near the CBD area * Targeting on ladies who are working adults, age from 25 to their 45 * Position Amore as a prestige brand with a high-end image within the ladies * Awareness of excellent fitness classes and spa services among the target market * Successfully use price skimming strategy for its services * To achieve brand awareness within the state by 15% within 12 months from the opening date and attain a 5% market share in the Australia fitness industry * To achieve a 10% profit in the 1st year * Achieve awareness through readership of the magazines * To have 100 memberships, 10,000 patrons in the 1st year * Building a relationship with the customers through events, customization and customer relation management| TWO| * Introduce additional fitness classes and also spa treatment appliances * Introduce price bundling strategies through promotional bundling of services * To achieve brand awareness within the state by another 15% in the 2nd year * To achieve a 15% profit in the 2nd year * Setting up an interactive Amore’s website meant for Australian ladies * Make Amore the preferred choice of fitness centre among the target market. Membership increase by 50%, patrons increase by 30% in the 2nd year * Devote 20% of gross profits in services area to improve on their customer service| THREE| * Amore to be a top of the mind fitness and wellness centre among the target market * Amore will be more than just a fitness centre, but a part of the ladies’ lifestyle * Adding additional outstanding gym equipments and professional local personal trainers * Using relationship pricing strategy and price bundling strategy after stabilizing * To achieve brand awareness within the state by another 15% in the 3rd year * To achieve a 25% profit in the 3rd year * Choosing an appropriate spokesperson for Amore * Collaborating with other associations for events to create more hype * To have 200 memberships, 10,800 patrons in the 3rd year * Employ local (Australia) instructors * If business is good, planning of opening the 2nd outlet at Sydney or Melbourne | 8.
Segmentation Profile Market Segmentation allows us to focus on the subset of prospects that is more likely to purchase based on our offerings. This is done in order to provide the highest return for the marketing or sales expenditures (Centre for Business Planning 2010). 8. 1 Demographic Amore would be targeting female working adults from age 25 to 45 in Sydney, the state capital of New South Wales, as it is has the largest number of population in Australia. Also, Sydney is one of the well-developed cities in Australia where the social trends are increasing. Hence it matches the criteria of what Amore is looking for in a country to open its subsidiary outlet.
Furthermore, working adults that Amore is targeting have a deep commitment to their career and family, and they are facing stress from their workloads. They would like to de-stress and relax with their loved ones thus, patronizing Amore fitness for relaxation as Amore specialize in fitness, spas and also offering superior services to the customers. Female working adults need more relaxation services as compared to men (The Medical News 2005) hence they is a great customer base for Amore. Moreover the obesity rate in Australia is increasing rapidly among females and males (Australian Bureau of Statistics 2008) whereby one in two people in Australia are overweight (Betts, M. 2010). Figure 4 shows the obesity rate of men and women in Australia that is increasing rapidly over the years.
Because of the increasing numbers of obesity rates, Amore takes this opportunity to enter the new market in Australia, as it believes to decrease the numbers of obesity rates with the use of Amore’s first-rate gym equipments and also outstanding personal trainers with ample experience. Demographic segmentation is a strategy that categorizes the population according to age, gender, social class, income and also occupation into deliberation (Naik n. d. ). It helps Amore in selecting the right market to target as it can help to save unnecessary expenses. According to Figure 5, it shows that female workers (57%) working in the Public Service in Australia outweighs the male workers (43%) (Australian Government 2008) where women nowadays are independent and can help supporting themselves. Thus they have the ability to splurge in Amore for relaxation or wellness.
Furthermore, the average age of working population of the males and females in Australia is of 15 to 64 years of age (Australian Bureau of Statistics 2010). Based on Figure 6, the reason Australians exercise is because their health and fitness are their priority (Australia Bureau of Statistic 2007). 60% of the population exercise as to look after their health and fitness and to improve their condition hence Amore is the best selection for the customers. Likewise for Amore, they specialize in offering the best health and fitness services to their customers with the word-class gym equipment offered and also the best spa centers for the customers.
Thus, Australia is the preeminent place for Amore to set another outlet there, as Amore is able to offer what the customer wants and also satisfy their needs. 8. 2 Geographic Geographical segmentation is a strategy where prospective customers are divided based on the geographical units such as the cities, states or even countries (Nair n. d. ). According to the figures of the population rate in Australia extracted (Australian Bureau of Statistics, 2010), Amore should focus on Sydney, as it is the most densely populated city in Australia (See Fig. 7). Amore can also look forward in opening more branches in the future; in areas such as Victoria and Queensland as these two states too have quite a number of populations as compared to the other states in Australia.
As Amore is entering into a new market, Sydney would be the stepping-stone to succeed in the new market as it is already locally here in Singapore. 8. 3 Psychographic Based on the Australia Bureau of Statistics 2010, it shows that the employment rate of Australia had increase over the past one year whereas the unemployment rate in Australia has decreased. This shows that the social trends of Australia have improved and hence, it is the right choice for Amore to enter the Australian market as the social standards too have improved where the Australians do not mind splurging on fitness and wellness. Table 3 shows the average wages received categorized by their state whereby the Australian Capital Territory achieved the largest amount f wage followed by the Western Australia and New South Wales (Emigrate to Australia 2010). Thus customers in Australia are able to afford to visit Amore for fitness or spa services. Psychographic segmentation is sometimes also referred to as behavioral segmentation. This allows Amore Fitness to segment its target market into groups based on consumer’s lifestyles. It considers a number of potential influences on buying behavior, including the attitudes, expectations and activities of consumers. Therefore, product and promotional marketing campaign would be tailored to customer’s motivation and hence be more of an appeal if psychographic segmentation is taken into consideration. (tutor2u n. d. Amore Fitness has targeted female working adults of middle class and upper middle class having a lifestyle of pre-family or family. As its target market places importance in individual’s image and are fond of established, prestige products and services that demonstrates success to their peers, (Strategic Business Insights 2011) it is perceived that in the AIO (Activity, Interest, Opinion), consumers goes shopping constantly in order to own the latest fashion trends to keep up with image. Also, due to their hectic schedule, consumers favour convenience therefore it is a good decision for Amore Fitness to locate their outlet near the CBD area which is near their workplaces.
Degree of loyalty would be high, as once consumers find Amore Fitness to be appealing and hence sign up for its packages, this would increase the probability of customer retention as Amore Fitness will be able to understand more on what consumers actually want and be able to cater to their needs. In addition, medium usage is expected, as consumers would only visit Amore Fitness at most 2-3 times a week. 8. 4 Benefits It is a part of market segmentation based on differences in specific benefits different groups of consumers look-for in a product. (BusinessDictionary n. d. ) As Amore Fitness’s target market holds great importance in individual’s image, hence looking good is definitely on its agenda.
Therefore, Amore Fitness allows consumers to keep and stay fit with its quality services and facilities and also, helps them to release stress and unwind after a stressful day at work. Also, as consumers in this target market demonstrate any form of success to its peers, therefore through the word of mouth, Amore Fitness is able to gain brand recognition at a fast pace. In addition, because of the appeal consumers have for high quality products and services, and the convenience of its location would be an immense advantage to Amore Fitness Australia to franchise to. 8. 5 Breakdown of Market Segments Segmentation Profile| Sydney| Geographic| 70% city and 30% rural areas|
Demographics| Average Age is 28| Socio economics| Average income is $65,863| Psychographics| High social trends consumers| Behavior| Achievers| Benefits| Able to relax and enjoy quality services and products| 9. Marketing Mix Strategy 9. 1 Product Strategy Product strategy that Amore uses is the Product Line Strategy. Amore’s product line offers a group of similar products that appeals to the publics at the Amore Fitness such as dance classes, body mind soul classes to cardiovascular and toning classes (Amore Pte Ltd n. d). Also, five-star spa facilities, Swiss Showers, Jacuzzi, Oxygen Cove and aromatic steam bath facilities at the Amore’s Boutique Spa (Amore Pte Ltd n. d).
Whereas the Product Line Strategy helps Amore in selecting the suitable products that should be produced and also the best way to market them (Lauren, D. 2010). The characteristics of the product should therefore be unique in order to retain and attract more customers (Taraporewala, A. 2011). In Amore’s case, the exclusive products that they offer are wide range of world-class gym equipments, fitness classes, spa services and also professional services for Amore’s customers where it is the reason that makes Amore stands out from their competitors. Furthermore, Amore uses Product Bundling Strategy where they combine more than one product together with a special price that is certainly cheaper then purchasing individual item (Lauren, D. 2010).
Amore can come up with combinations of spa and fitness treatments offered as a package at an affordable price (Amore Pte Ltd n. d) as it can attract first time customers as well as customers who do not want to spend too much on packages, helping them save money (What is Product Bundling? n. d. ) and to relax at the same time. Standardization Versus Adaptation Amore should standardize their world-class gym equipments in Australia, as it is one of the major appeals to the targeted customers. Furthermore, the world-class equipments are able to enhance the whole work out experience and it is one of the reasons that differentiates Amore form the many other competitors out there.
The quality of gym equipments can change the result whereby if the quality of the equipments provided is poor, the result will be poor and vice versa (Adaba 2011). Also, customers seek for quality equipments in visiting a fitness club. Moreover, the blueprint of Amore should be standardized for instance the spas and fitness clubs because the layout of the place plays an important part to the needs of the customers whereby it will be nicely furnished to give the customers the complete feeling of the after-spa and also the fitness clubs. Clean and relaxing surroundings is a plus point for Amore, as nobody would enjoy having to be in a place that is dirty and suffocating especially in a spa or a fitness club.
Also, the surrounding determines whether the customers receive full relaxation from the spa or even the outcome of the trainings (Delmonte, V. 2009). Amore’s brand and trademark ought to standardize with the outlets in Australia as to avoid confusion with the customers in Australia and the locals in Singapore. Whereby the mission vision and also Amore’s goal will be standardized to the other Amore outlets. Amore should also position at its best with the relatively good product such as the superior gym equipments, excellent ambience of the spa centers and not to mention the outstanding professional service that Amore could offer to its customers as to increase Amore’s brand awareness in the overseas market whereby their image in the local market is already venerable.
However, services that the personal trainers provides should adapt to Australians because the way the locals and the Australians trained are vastly different whereby the Australians are more rigorously in exercising whereas the locals are more to relaxation (Hagger, D. 2010). Furthermore, the spa techniques and ingredient Amore uses for the spas centre ought to adapt to the lifestyle of the customers in Australia as the climate is different with Singapore. Thus, Amore should avoid using standardization in the spa techniques and also the materials but adaptation in order to attract more customers in Australia. Also, the programs that Amore offers should adapt to the lifestyle of the Australians because the locals prefer a whole series of fitness classes like the Pilates, Yoga or even spa but on the other hand the customers in Australia may not have the same preference with the locals.
Hence, Amore will adapt and improve the current programs to suit the customers in Australia in order to attract more customers to Amore and it can help save any unnecessary outlays. Nevertheless, Amore should develop new products according to the requirement or feedback of the customers as to meet and satisfy their needs indirectly leading to an increment of returning and also new customers to Amore. 9. 2 Price Strategy It is essential for Amore Fitness to take into considerations of the competitive and legal environment the company has planned to diversify into. Prices of competitors are one of the major factors Amore Fitness should take into account when making pricing decisions.
A price war could be inflicted when prices are set both exceedingly low or high. As of a legal point of view, price controls are established to prevent companies from pricing too high, while predatory pricing might be considered when prices are too low. Amore Fitness Singapore’s pricing strategy is set on bringing good quality services at an affordable price. Thus, combining both market pricing and price bundling, it has let Amore Fitness Singapore to flourish. Hence, with the understanding of the Australian target market’s income, it is proposed that in the first year of operations, Amore Fitness Australia will employ price skimming business strategy where the price is set high in its introductory year.
This would also, help in segmenting the market into various target market groups, which would be tiered according to the consumer’s willingness to spend. This also allows the company to recoup costs and the ability to incur the highest possible return in the quickest time. After which, price bundling would be introduced in the second year where packages would be bundled with attractive discounts or special rates so as to entice new or existing customers to buy more. This strategy opens up to the majority of the population, as the prices are now affordable for most consumers to purchase. It would create more brand recognition for the company as well as gauging how the market would react to it price changes.
In addition, penetration pricing could also be another option where prices are set low to gain market share and sales volume. Promotional prices could be offered during early bird specials or any promotional prices for a limited time. This would serve as an enticement and more reasons to purchase from Amore Fitness. In the third year, the company would able to understand the environment of Australia’s fitness industry and set a more stable price range for their market. Therefore, relationship pricing is introduced due to its flexibility in modifying its prices to forge long-term relationships with the customers. They can also still implement the price bundling strategy through the years by bundling new and attractive packages to the market.
Due to the fitness industry being dynamic, by using the above pricing strategies, it is foreseeable that a growth in its market shares for Amore Fitness would be possible and therefore strive to increase its foothold in the Australian fitness industry. 9. 3 Distribution Strategy Market Entry into Australia In 17 February 2003, the Free Trade Agreement between Singapore and Australia is established. (Australian Government – Department of Foreign Affair and Trade 2008) Thus, the barrier for Amore to enter into Australia market is low and it is also political stable. There is an increase in emphasizing on health and wellness in Australia as the obesity rate is rising.
Hence, venturing into Australia will be a good stepping-stone for Amore. State: Sydney The first outlet of Amore will be situated in Sydney. Sydney is the capital of Australia and is densely urbanized (City of Sydney 2010). In a developed city, supplies and transportation will be more accessible. On top of that, Sydney is a multi-racial city with many different nationalities, majority of them are Asians. Since Asians are very health and body conscious, Amore would be able to have a good customer base in Sydney. Area: CBD Amore’s target audience is the females working adults in Sydney. Thus, situating in the CBD area will bring convenience to the ladies.
In addition, Sydney has the largest CBD office market in Australia (City of Sydney 2010). This could generate greater awareness within the ladies. Besides, Amore is targeting at affluent working females who have enough disposable income and high spending power. Setting up the first outlet in Sydney CBD area would be the best and fastest way to earn enough profits and awareness to expand the business. Branch Office / Subsidiary Branch Office is a smaller, remotely located office that is separate from a company’s corporate headquarters (Entrepreneur 2011). The offshore subsidiary is a legal entity in its own right, with its own management, costs, and profits and losses (EnterpriseOne 2006).
Setting a branch office or a subsidiary in the overseas market requires a lot of financial investment yet, through this method businesses are able to set up a presence and make a huge impact in the market. This is because the companies are able to offer a full range of products and services (sales, marketing and product development) at the same time having full control over it (EnterpriseOne 2006). Based on the marketing objectives, Amore aims to create a presence and a great impact in the Australia market. Thus, these two methods are able to achieve the objectives. However, there is a difference on how the branch office and a subsidiary work. Table 4 shows the differences of a branch office and a subsidiary company (Image: Guide Me Singapore 2010). The decision of venturing into the Australia market is an extension of Amore business.
Thus, for a start it will be better for Amore to set up a branch office to distribute and market its business in Australia as compared to setting up a subsidiary. As most businesses start with branch offices and later convert them into subsidiaries for tax purposes (EnterpriseOne 2006). 9. 4 Promotion Strategy In terms of marketing communication, Amore aims to create brand awareness, informing and persuading target market that they are able to experience luxurious services at affordable prices that suit their budgets. Promoting using advertising helps to raise awareness. At the same time, it must be entertaining to catch target market’s attention and the message delivered must be memorable to create recognition.
Hence Amore aims to promote its brand and services through advertising in magazines and newspapers. Ads can be printed in International Business Times, ABC7 News etc. , while print ads can be shown in lifestyle and beauty magazines such as Australian Women’s Weekly, Woman’s Day and Girlfriend. These magazines are popular healthy lifestyle and fashion magazines that focus on health, beauty, fitness, nutrition, fashion, and weight loss (W3newspapers n. d. ). Events and beauty workshops will be organized to gather Amore’s target market that are like-minded and have similar interests. It is important to show how professional Amore is, so as to position Amore as a prestigious, high-end fitness and wellness centre in the target market’s minds.
Hence, professional health nutritionists or specialists will be invited to the events to give talks on health and beauty. In addition, free health and beauty advice; free trials and even membership will be given to the females who attend the event. At the same time, Amore will be advertising through direct marketing to create awareness; brochures and flyers will be distributed at shopping malls and partnering stores in the malls. However, advertising through the distribution of brochures and flyers alone are not enough to sustain current status and create opportunities for expansion (Wilkinson, McAlister and Widmier 2007). Amore will need to reach out to more customers from different districts and those who do not frequent the malls.
Since e-marketing is a positive trend in today’s marketplace (Yudelson 1999), Amore should advertise the brand through its website. Amore already has an existing website, thus it is suggested that Amore create an extra link to its Amore Australia website, providing all the necessary information about the company (about the company and its packages, venues, contact number, email, etc) and its services, as well as latest events and happenings about Amore. To further enhance the website and effectiveness, Amore should incorporate interactive e-booking services so that customers can book their lessons through the website and also see the available slots online. In addition, they can also read up on the instructors’ profiles.
These will then increase effectiveness and interactivity, yet shorten time and offers convenience. To hype up Amore even more, EDMs or email newletters will be sent to members, updating them on the latest happenings and promotions. Hence, these advertising promotions are targeted to achieve the marketing objectives of the first year as well as the second year. After the second year of opening, Amore should have its own customer base and loyal customers. In order to prolong its growth period in PLC stage, Amore will invite an Australian celebrity, known for her natural healthy look, to be the spokesperson for the company. This will then stir up curiosity and hype, and also raise its image branding to a new level, boosting sales.
Furthermore, Amore Australia’s website can be even more improved in terms of its interactivity to create closer relationships with the customers. For instance, setting up forums about health information; a place for like-minded females to discuss about health issues can help to create greater bonds with each other as well as the company. This will also help to retain Amore’s loyal customers. Lastly, Amore can increase its consumer database through joint relationship with branded vendors such as Nike, Adidas, and Sports Clubs etc. Sponsorship of sports events can also help in increasing awareness and building the company’s brand image, achieving the objectives for the third year. 10. Implementation Chart
Implementation plan generally includes the specficiation of marketing objectives, resources allocation, formulate of manpower and development of integral marketing commnication. It focuses on : * Risk management to alleviate potential risks * Effective time and cost management on resources whereby maintain within budget contol * Training and development of employees are on priority to ensure high standard of quality management are met * Ensure effective internal and external communication Therefore an implementation chart is shown below with the recommendations outlined over the next 12 months. Implementation chart shows how Amore implements on the selected strategies over a period of 12 months. Jan| Feb| Mar| Apr| May| Jun| July| Aug| Sept| Oct| Nov| Dec| Product| | | | | | | | | | | | | Selection of Products| | | | | | | | | | | | | Maintenance & Purchasing of Equipments | | | | | | | | | | | | | Maintenance of Exterior Blueprint (Lights, Signboard, Furniture & Plants)| | | | | | | | | | | | | Management & Customer Service| | | | | | | | | | | | | Price | | | | | | | | | | | | | Reference Pricing| | | | | | | | | | | | | Flexible Pricing| | | | | | | | | | | | | Place| | | | | | | | | | | | | Branch Office Rental Cost| | | | | | | | | | | | | Accessibility| | | | | | | | | | | | | Promotion| | | | | | | | | | | | |
Marketing communication (magazines, newspapers, flyers)| | | | | | | | | | | | | Events / Sales Promotion (Workshops, events, partnering events)| | | | | | | | | | | | | e-marketing (websites, email newsletters)| | | | | | | | | | | | | 9. 1 Evaluation Chart When an organisation implements strategies over a time span, there would not be guarantees that it will be successful. Hence Amore needs to come up with an evaluation plan to ensure that the implementation is successful. | Measurement| Evaluation| Who will evaluate| Product| Selection of Products| To satisfy and meet the demands of customers| Every 3 months| Sales Manager, Human Resource Department, Finance Department, Research & Development, Front line Management & Researches. Maintenance & Selection of Equipments| To attract new customers and retain current customers | Every 6 months| | Maintenance of Exterior Blueprint (Lights, Signboard, Furniture & Plants)| To ensure the customers that their money would not go to waste and relaxation would be achieved| Every 1 year| | Management & Customer Service| Ensure top quality services offered to the customers and to attract new customers and at the same time retaining current customers | Every 2 months| | Price | Reference Pricing| To gauge where the company standsTo gauge whether the price is overvalued or undervalued| Every 1 yearEvery 3 months| Finance Department, Human Resource Department, Marketing Department, Sales Manager| Flexible Pricing| To forge relationships with consumersTo entice consumers to purchase moreTo build up its consumer database| Every 3 monthsEvery 6 monthsEvery 2 months| | Place|
Branch Office Rental Cost| Check on the value of the branch office | Every Month| Finance and Management, Marketing | Accessibility| Understand about consumers’ convenience and time taken| Every 3 Months| | Promotion| Marketing communication (magazines, newspapers, flyers)| Research on ways to advertise, the cost of advertising and the time spent| Every 3 months| Marketing and Communications, Advertising, PR and Finance departments| Events / Sales Promotion (Workshops, events, partnering events)| To raise brand awareness and brand perceptions, as well as building relationships and increase revenue| Peak periods and holidays| | e-marketing (websites, email newsletters)| To reach out to more people through online means and update them on promotions, trials, events etc. | Every 3 months| |