Market Audit and Competitive Market Analysis
The product we want to sell in Mexico City is a Tablet intended for school students from 10 to 15 years old. It is small, easy to use, and relatively cheap, which makes it affordable for most families. The Tablet will primarily serve as an educational tool for students. It will be convenient for children to read school books or use different applications for education. All apps will be cheap and easy to download, set, and use. In addition, the Tablet will have a parental control. Currently, the product is under development, and some functions and features are not clear yet.
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The strongest features of our Tablet are as such:
· Its price is relatively low, and it is cheaper as compared to most tablets sold in Mexico. We plan to set the price at a level of about $70-$100, depending on the specification of a particular model.
· Our Tablet is designed exclusively for schoolchildren, which makes it different from the majority of tablets available in the market. Thus, users will derive a benefit from using special applications that will be free or cheap and intended for students. Moreover, some unique apps will be offered, for example, the parental control that will allow parents to control the apps the children can use. Currently, competitors do not offer such applications. Thus, our Tablet has a competitive advantage in the market because it will be helpful and beneficial to students, teachers, and parents.
· The Tablet will be relatively small and light, which is convenient for children because it will be easy to take it to school every day. Moreover, Tablet will be sold with a case that prevents it from various damages.
· The Tablet will have a 30-day warranty together with free over the phone assistance and IT help from 7 am to 11 am and from 2 pm to 11 pm. Thus, customers will be sure of the quality of the product, and they will be able to receive any help in case of need. Most competitors offer a warranty or guarantee on their products, but not all of them provide online and over the phone customer support.
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However, the major weaknesses of our Tablet are the following:
· The main weakness is that, due to the low price, the Tablet will have the hardware of a medium quality, and it will not be powerful enough for videos and some applications, like games. Thus, the Tablet cannot be used for any purpose, and its use is limited to education and learning purposes, which limits the range of potential market segments and customer groups.
· As the product is new in the market, most clients do not know about its features and, consequently, they may not trust it. Usually, customers tend to trust famous brands more. As the price is low, they may also think that the quality is poor as well.
· As mentioned above, the Tablet comes with a warranty and customer support, but they are both limited, which may discourage customers from buying our product. For example, a 30-day warranty is quite short in comparison to the products of competitors that may offer a longer warranty period.
Currently, the Tablet is in the introduction stage of the product life cycle (“The Product Life Cycle”). It means that the product is just introduced to the market, and the customers need to know more about it to be willing to buy and try it. Therefore, we should build the product awareness and start the promotion and branding of our product to inform the target and purchasing audience about its benefits to stimulate them to buy it. Currently, the sales are starting, and we do not have a particular market share yet. For this stage, penetration pricing is a good choice because customers will be attracted by low prices.
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It is relatively hard to establish the total market because it may include various groups of people. Different groups of customers use tablets, and they all may be a part of a total market. To establish the total market, it is necessary to study the population of Mexico City. According to City Population, in 2015, the population was 8,918,653, and the tendency of growth can be noticed. In particular, the population of Mexico City was about 8.7 million in 2005 and 8.85 million in 2010 (City Population). Thus, the number of potential customers is growing. Moreover, the age distribution of the Mexican population is positive for our product because schoolchildren account for a relatively high percentage of the population. In particular, for ages 10-14, the percentage of males and females in the population is 4.7% and 4.5%, respectively (“Mexico”). Therefore, there are many potential customers, who may be interested in buying the Table.
In order to study the market, it is necessary to investigate adults as well because the Tablet will be bought by parents for their children. One of the most important factors that influence the purchase decision is consumer spending. In Mexico, consumer spending has grown recently. In the fourth quarter of 2015, it reached its maximum of 10035196 MXN Million (“Mexico Consumer Spending”). Thus, as consumer spending is growing, it is positive for selling the Tablet because consumers will be more likely to buy it. In general, market conditions are positive for our product. The high population of children is favorable for sales because the Tablet is intended for students from 10 to 15 years old. Moreover, as consumer spending is growing, parents will be more and more willing to buy the Tablet for their children.
In the market, our product has some strength. The main strength is that our Tablet is relatively cheap, and it can be affordable for families with medium income. Moreover, it is intended for children and has special apps for school and educational purposes. Most competitors do not offer them. Moreover, such functions as the parental control, warranty, and customer support are great advantages. On the other hand, the main constraints in the market include the new brand that is not known by customers. As a result, they may prefer brands that are more famous. In addition, the product is intended for children, but purchase decisions are made by their parents. Some parents may consider tablets harmful to children, especially to their eyes. They may also think that these gadgets are intended for entertainment, not for study. Thus, they may refuse to buy our Tablet, and we should make efforts to persuade them and prove that it is not harmful and may have many benefits for their children. In particular, it is useful for school and study and more convenient compared to books.
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There are some market features that are positive for us to utilize in a successful marketing program. The first feature is the growth of the number of potential customers. As it was mentioned above, the population of Mexico City is growing. Thus, the number of potential customers for our marketing program is increasing as well. Moreover, in Mexico, it is more and more popular among people to use social networks. According to Statista, the number of social network users in Mexico increased from 48.6 million in 2015 to 55.3 million in 2016, and it is projected to reach 61 million in 2017 (“Number of Social Network Users”). Thus, it is positive for a marketing campaign on social media because more potential customers will be reached.
Our main competitors are popular models of tablets, such as Apple iPad, Samsung Galaxy Tab, and Huawei MediaPad. Their main advantage is that they are produced by famous brands that are known by customers. However, the disadvantage is their high prices. Therefore, the Tablet is less famous but cheaper compared to them.