Marketing Plan for TK Maxx and Its entrance in the French Market

Executive Summary

TK Maxx is a reputable company that prides itself with the low pricing model. Its recent goal to explore the global market has made it to redirect its efforts on the French market. This can be achieved through implementation of the marketing plan. The plan compelled the company to conduct both PESTEL and SWOT analysis. France is politically stable, which provides the good atmosphere for business establishment and growth. Based on the analyses, TK Maxx need to focus on creating awareness and interest among customers in the French market. This could be attained through development and implementation of AIDA model and Drip marketing, and marketing dissertation help could further enhance their strategies. However, it is more recommended for the company to explore its technological advantage for the purposes of widening the coverage.

Introduction

Fundamentally, businesses are modelled toward their respective expansion and growth. In the wake of globalisation, local businesses would put their focus on a national reach as the multinational ones focus on the market gaps around the globe. Such deliberations and business goals makes marketing plan more significant in the contemporary global market. Marketing plan is regarded as part of the business plan, which defines the foundation of the marketing strategy attached to a certain business or organization. Marketing plan presents a comprehensive document or the blueprint known for outlining the marketing and advertising efforts expected to run within a specified period. TK Maxx equally enjoys a significant share of the marketing plan as it retains the business strategy of selling its products at 60% off the retail price recommended in the market. As the company strikes to explore more markets around the world, the off-price retail mission remains significant in ensuring that customers can have the labels they want at an affordable price. Its rise in retail shopping can be accredited to the numerous social media accounts and the emergency of the fashion-savvy consumers. Based on this, the marketing plan will mainly focus on the situational analysis, the objectives, marketing strategies such as Drip and Aida, implementation of the strategies and monitoring and control.

Background of the Company

TK Maxx is a subsidiary of The TJX Companies, Inc., a multinational off-price department store corporation that owns retail stores as well as the home goods and based in Framingham, Massachusetts. Most of its stores were established in the year 1977 and mostly operate in Netherlands, United Kingdom, Germany, Australia, Poland, Ireland and Austria. The company has a total of 515 stores across Europe and around 35 stores in Australia as of April 2017 (Schroeder 2017). In the year 2007, the company began winding down on the new store openings in UK. The major focus was placed on revamping the available stores or even relocating them. The corporate vision attached to the company includes growing the global-off price as well as value company. This is also tailored towards the company’s mission and goals, which constitutes delivering to the market a rapidly changing assortment of the quality merchandise that is priced at 20-60% less than the normal prices (Schroeder 2017). TK Maxx is essentially known for availing the same season apparel, which only leaves out a single-digit percent that is essentially sold out of the season. Amid its operations in UK, Germany, and the United States, TK Maxx has consistently faced competition from Primark, Macy’s, and Germany’s C&A.

Situational Analysis

The situational analysis focuses on the significant factors that control the French market in which TK Maxx is showing interest. This would be regarded as the external environment. Subsequently, the analysis will further give attention to the SWOT analysis, which describes the internal business environment.

PESTEL Analysis

PESTEL Analysis is regarded as a framework applied in analysing as well as monitoring the macro-environment. Significant pointers in this framework include the political, economic, socio-cultural, technological, environmental, and legal factors. For the French fashion market, the following factors stand.

Political factors: France is considerably one of the significantly stable country across the western world and therefore plays an important role when it comes to the international affairs. Notably, it has maintained excellent bilateral relations with the United Kingdom. France further has good political stability, which makes business to thrive (Demossier et al. 2019). Over the recent past, France has however faced challenges related to lawlessness and terror over the past decade. At the same time, French foreign policies have attracted criticism, which means that TK Maxx has to relook at the reputation of the country.

Economic factors: France is ranked among the top ten economies around the world. France, therefore, contributes greatly towards the gross domestic product (GDP) of the EU. Notably, the French market has been excellent in terms of the luxury products and cosmetics, which counts as part of fashion (Grünig and Morschett 2017). The country is expected to secure a good space for economic growth. This would have a positive impact on the fashion and apparel industry where TK Maxx is part. However, there are still doubts regarding the inflation rate, standing at 2.2% as of September 2018. At the same time, the company tax rate stands at 33.33%, which is something that may significantly reduce the gains accrued by the company.

Socio-cultural factors: France has largely been claimed to be among the most modern countries across the world. The country has an approximate population of around 63.5 million. It is also famously known for perfume, cuisine, language, culture, and fashion. As pointed by Gatouillat et al. (2019), this has made it one of the highly visited destinations for tourists. Despite enjoying a good social environment, France has its own social challenges as well (Demossier et al. 2019). Unemployment rate at 8.5% as of October 2019 is considerably high. It also experiences labour unrest, industrial strikes, and even demonstrations. For instance, Yellow Vest movement seeking financial and economic justice and characterised by violence, civic disobedience, vandalism, rioting, and strike action has rocked the country since October 2018 affecting economy and country’s image. The anti-immigration sentiment is also rife.

Technological factors: France is among the most advanced countries across the world in terms of technology. The remarkable history has shown its dominance in such areas like IT, science and even space technology. The same attention is extended to mobile and internet technologies with 86% of the individuals making use of them as of the year 2016. This factor is putting more people on the social media platforms, which give TK Maxx and other companies a marketing advantage (Gatouillat et al. 2019).

Environmental factors: France became one of the most visited countries around the world after experiencing 89 million tourists in the year 2017. However, this posits environmental challenges including water and air pollution. France is currently supporting legislations and policies that would help in containing the challenges.

Legal factors: More attention is given to working length, which should be 35 hours in a week for all types of the companies. The French labour laws are believed to have set aside provisions for the annual leave, paternity and maternity leave, employee overtime and sick leave. Labour laws need to be adhered to by such companies like TK Maxx (Nikolka and Poutvaara 2019).

SWOT Analysis

Under SWOT analysis, TK Maxx can identify its own strengths, weaknesses, opportunities, and threats as well related to its business operations and activities.

Strengths: TK Maxx has a chain of stores across 5 different countries, which is something that enhances its presence in the global market (Cichocka 2016). The price is relatively lower, which attracts a significant market share. The online store has been expanding with time, which bolsters the excellent presence while directing the focus on customer service.

Weaknesses: Customer service is not at its best across most of the stores. Moreover, departmental stores are seen to have few categories. Most of the consumers still find it contradictory for the designer clothes to be sold in bulk.

Opportunities: TK Maxx has a great opportunity of increasing the global market share such as the one in France (Cichocka 2016). The company can still increase the store merchandising activities for the purposes of attracting new customers.

Threats: The 2007 credit card fraud tarnished the reputation of the company thereby affecting the performance of some of the stores. Increased competition across the industry is another threat brought by dynamic nature of the industry.

Competitor Analysis

The apparel and fashion industry is very competitive essentially characterized by multinational brands, local brands and the small-scale traders. In the industry particularly that saw establishment and growth of fast fashion over the past decade, each player trying to survive in the market is forced to be innovative to remain afloat (Schroeder 2017). TK Maxx has been facing a stiff competition from such brands like C&A, Primark, and Macy’s on the global arena. Upon its focus on the French market, TK Maxx is yet to meet other giants such as Kering, which owns Balenciaga and Saint Laurent. The French group remains in front of competition regarding the long-term prospects. FarFetch, on the other hand, has revamped its services after receiving the $250 million investment from the commonly known Tencent Holdings. Other players that cannot be ignored include Cocosa, Secret Sales, LVMH, and BrandAlley among others.

Marketing Objectives

TK Maxx is making its first entry into the French market where it would establish and grow market for its apparel among other products. It would still model its entry strategy into new market to reflect low price model thereby making its retail cheaper compared to the competitors’ pricing segment. Therefore, TK Maxx aims to:

Create awareness of the brand and the 20-60% off-the-retail price model in the new French market

Create interest among customers by providing the desirable labels at the most affordable prices

Launch the loyalty program that would retain most of the consumers after the first purchase

Marketing Strategies

For the purposes of addressing the above marketing objectives, TK Maxx will make use of two fundamental marketing strategies; AIDA model and Drip marketing. The AIDA model stands for A-Attention, I-Interest, D-Desire and A-Action. It is essentially regarded as an advertising effect paradigm, which highlights the significant stages through which an individual undertakes before purchasing a product or even a service (Hadiyati 2016). The mode is essentially used in public relations, digital marketing, and even the sales strategies campaigns. While making use of this model, TK Maxx has to first check on the first component of the AIDA, which denotes Attention of the customers. The best approach that can be deployed at this stage includes the creative disruption involving breaking the prevailing behavioural patterns via a highly creative message. Given that the French market is a new market to TK Maxx, it has to construct provocative imagery and intensely targeted message.

The second component is Interest, which is the most challenging part (Alavi and Mosavi 2017). TK Maxx can create interest by ensuring that the advertising details are easy and broken up as well as comprehensively illustrated. The third component is Desire, which includes helping the potential customers to realize the reason to take the product or service. TK Maxx has to provide the most interesting information regarding the apparel and the low price model that provides up to 60% discount. The final step is Action, in which the company needs to initiate an action. Sample products for trial or statement can be used in getting the immediate feedback from the customers. Apart from the AIDA model, TK Maxx can make use of Drip marketing strategy. This is regarded as a communication strategy that essentially sends pre-written messages to customers. In addition to email marketing, social media can be employed as an effective aprpoach (Stych 2017). It is important that Drip marketing should come after implementation of AIDA model to pave way for consistency.

Implementation

The most critical part is the implementation process because it determines the outcome of the entire marketing plan. TK Maxx has to consider significant steps that need attention in terms of provision of the necessary resources. First, TK Maxx needs to communicate effectively to the entire staff regarding the company’s mission in the French market. The mission is to create awareness of the brand, create interest, and launch the loyalty program in the French market as far as the company’s product are put into consideration (Hadiyati 2016). Secondly, TK Maxx would form willing teams based on the number of activities in the field. Two key teams would be necessary with one being assigned the AIDA model and the second one assigned the Drip marketing. The AIDA model would require 4 sub-teams formed from the first team, which need to work in coordination to produce the desirable results. Third, set simple goals from the 7Ps and Key Performance Indicators as shown below.

Fourth, planning the AIDA and Drip campaign which details the activities and the days they would be executed. For instance, the AIDA model can be executed in two days with each day taking two phases of the model. A team would be on the ground to appeal to the customers to show interest in a particular line of goods. Flyers and even Placards can be used in attracting the attention of the customers. Fifth, TK Maxx would have to assess the immediate response through a check on the KPIs. Finally, prompt monitoring and control session.

Monitoring and Control

Monitoring and control constitutes the most important session in which TK Maxx has to prompt significant adjustments that would attract the best outcomes. Monitoring would entail checking on the KPIs and assessing whether the target has been met or not. If TK Maxx intends to achieve 80% of the sales from the AIDA model, then a 75% or 70% sale would show that the strategy is not far away from addressing the marketing objective of creating awareness and interest among customers. Significant KPIs that need to be monitored include sales, stock turnover, customer turnout, and time of delivery. On stock turnover, TK Maxx would keep an eye on how each strategy drains the stock before a refill. On the customer turnout, the company pays attention to the number of customers who would prefer to visit the stores, the ones who need goods to be delivered to their doorsteps and the ones who would wish to have an online engagement.

The assessment of these three areas is important for the company to determine the most appropriate channel. Control includes measures that a company would take to ensure the desirable performance of the strategies. A contingency plan is always needed to utilize or explore the available opportunities. In case the AIDA model does not work well with advertisements through flyers and placards, then TK Maxx would be forced to pursue the face-to-face engagement. This approach ensures that one person runs all stages of the AIDA model at time. However, the approach can be slow because the company can only convince one person at a time.

Conclusion and Recommendation

The marketing plan has been reasoned as the foundation of the marketing strategy, which plays a vital role in most businesses across the world. The report has outlined the essence of a marketing plan to such companies like TK Maxx which seek to explore new markets such as the French apparel market as growth and expansion strategy. The report records the situational analysis which noted the PESTEL analysis of the French market and the SWOT analysis of TK Maxx. This prompted development of the marketing objective that noted the essence of creating awareness and interest among customers. The objectives attracted the development and implementation of AIDA model and Drip Marketing. However, it is more recommendable for TK Maxx to utilize its technological capacity before venturing in digital or online marketing as noticed through drip marketing.

References

ALAVI, S.M. and Mosavi, S.M.H., 2017. AIDA model simulation with an emphasis on integrated marketing communications (Case of study: Ligno activator product of Jahan Kesht Falat Sabz).

Cichocka, E., 2016. Improving The Functioning Of Service And Trade Company Using The Theory Of Constraints (Doctoral dissertation, Zakład Zarządzania Produkcją).

Demossier, M., Lees, D., Mondon, A. and Parish, N., 2019. The Routledge Handbook of French Politics and Culture. Routledge.

Gatouillat, C., Griffet, J. and Travert, M., 2019. Navigating the circles of social life: understanding pathways to sport drop-out among French teenagers. Sport, Education and Society, pp.1-13.

Grünig, R. and Morschett, D., 2017. Determining the Target Markets. In Developing International Strategies (pp. 85-104). Springer, Berlin, Heidelberg.

Hadiyati, E., 2016. Study of marketing mix and AIDA model to purchasing on line product in Indonesia. British Journal of Marketing Studies, 4(7), pp.49-62.

Nikolka, T. and Poutvaara, P., 2019. Labour Market Reforms and Collective Bargaining in France. ifo DICE Report, 16(4), pp.44-49.

Schroeder, J.E., 2017. Corporate branding in perspective: a typology. European Journal of Marketing.

Stych, J., 2017. What is Drip Marketing? The Complete Guide to Drip Campaigns, Lifecycle Emails, and More.

Dig deeper into Marketing in a Digital World with our selection of articles.