MARKETING PLAN
1) Marketing Goals and Objectives: State precisely the marketing goals and objectives in terms of sales volume, market share, return on investment, or other goals and objectives for your marketing plan and the time needed to achieve each of them.
2) Marketing Strategy:
a. The Target Market: Describe your target market segment in detail by demographics, psychographics, geography, lifestyle, behavior, benefits sought or whatever segmentation is appropriate. Why is this the selected target market? How large is it?
b. Value Proposition and Positioning Statement: Describe the offering's value proposition. How does it create value for the target market? Articulate the positioning statement. How will you create a distinct image of the offering in the minds of consumers?
3) Marketing Tactics (Marketing Program): Describe in detail how you will reach the target market selected in terms of the
(a) product offering
(b) price,
(c) distribution
(d) promotion.
With respect to each element of the marketing program, consider the following:
a. Product Offering: product features/packaging, branding, warranties and guarantees, post-sale service support
b. Price: pricing strategies and methods; discounts, allowances
c. Distribution: marketing channel structure, number and types of intermediaries, locations, availability, supply chain and logistics
d. Promotion: advertising, personal selling, sales promotions, public relations, direct marketing, social media
Also note how your main competitors are likely to respond when you take the action planned, and what you will do to avoid the threats and take advantage of the opportunities.
Old New Orleans Rum Distillery produces five different products that are sold throughout the Louisiana area as well as several other states. These products are the Crystal Rum, Amber Rum, Cajun Spiced Rum, 10 Year Aged Rum, and Gineroo. Each rum is distinctly different from the other due to different aging cycles and spices added. The Crystal rum offering is the most basic rum the distillery produces. Using Louisiana sugarcane, Madagascar vanilla, and water; this rum is very sweet and full-bodied compared to other white rums that are lighter in body and easy to mix. The Crystal rum is then shortly aged in barrels and blended to produce the delicious introductory rum. The Amber rum is the next rum offered by the distillery. This darker rum is distilled with Louisiana sugar cane molasses and caramel to help darken the rum and add a different dimension of flavor. The rum is aged for 3 years and then blended with other 3-year-old rums to create the dark hued, caramel and molasses flavored rum. The next offering from Old New Orleans is the always popular Cajun Spiced rum. This rum with its bright red label is distilled the same way as the other rums and blended with various other barrels and then infused with spices. The spice infusion process allows this rum to hide various flaws and also to provide different flavors than molasses, vanilla, oak, and caramel. The spices used are cinnamon, cayenne, vanilla, nutmeg, ginger, and clove. These spices allow for a deeper, more flavorful profile and allow this rum to be mixed with sodas or neat to experience the rum to the fullest. The most expensive rum in the Old New Orleans portfolio is the 10 year rum. This rum survived Hurricane Katrina and is now bottled with the addition of caramel due to the intense oak flavors caused by unnaturally warm days after the hurricane. The rum is a light honey color and has flavors of banana and some black pepper spice. This highly prized rum can only be purchased at the distillery, making this rum very limited with only 720 bottles made with the casks that survived. The final product created by Old New Orleans is Gingeroo. This concoction created at the distillery is a ready to drink mix of their Crystal rum, ginger, and Louisiana sugar cane.
The Old New Orleans Distillery has been in business for more than 10 years and have prospered in the craft liquor market. The master distiller has been working in the industry for many years and has the knowledge and competency to run a small-medium sized distillery efficiently. The financial resources for the distillery are enough to ensure the operations will continue especially with the ever-changing produce market for Louisiana sugar cane and Madagascar vanilla. The human resources have helped Old New Orleans stay properly managed and running efficiently despite unforeseen circumstances due to usual wear-and-tear of the still or other running machine parts. The capital resources have been invested properly in the building to ensure a prosperous future as well as expansion, if need be, and safety for the workers.
The company's long-term vision and strategic goal is to ensure the distillery will remain operational and better serve their clientele. The company's progress towards these goals is reinvestment in the facility, full stock of oak barrels used for the aging process, knowledgeable workers to ensure a consistent product, and a management team that can promote the product as well as run the distillery efficiently.
The key performance gap is not having state-of-the-art stills and computer systems similar to other international conglomerate distillers. Also by not having a backward integration similar to those international distillers, the sugar cane and vanilla might differ in quality and price. This performance gap could cause the products to differ slightly in price and quality and could turn away potential consumers.
The strengths of Old New Orleans Rum Distillery are the high quality products that are produced cover a wide range of rum and liquor drinkers, the locality of the distillery in the city of New Orleans, and tours of the distillery can help attract potential new customers. Also, the wide range of distribution in Louisiana as well as several other states allow for the attraction of new customers.
The weaknesses are the size of the distillery, the promotional budget, and the brand recognition. The size of the distillery can prohibit the products from reaching a wider audience. There are a limited number of barrels and barrel room space in the distillery, which means only 500 gallons of rum are distilled at any one time. This can potentially be an important weakness since the larger distilleries can distill thousands upon thousands of gallons at any one time. The promotional budget for this type of distillery is quite small compared to other distilleries or even breweries in the region. An integral part of any company is attracting new customers and retaining current customers, if there is a small promotional budget then there is a potential to miss many customers that would drink the rum if they were exposed to the name through printed, Internet, or telecommunications media. Another weakness is the brand name recognition. With the distillery averaging on the smaller side of production, it can be very difficult to brand the products to reach a wider drinking audience.
The opportunities of the distillery are the room for expansion, local customer support and growth, and a booming craft liquor market. The distillery is still prospering and will have to expand to keep the production capacity from stalling. There are plenty of large warehouses the distillery can expand and increase production capacity around the original location. With the local products movement currently taking hold in New Orleans, there products are being chosen above national and international rums due to the cause of helping small business survive and thrive in a downward economy. Along with the economic push for local ingredients, the craft liquor industry is growing while other national liquor distillers are losing market shares.
Threats are the national conglomerates essentially out-marketing and out-spending the local rum distillery for pieces of the market. These large corporations have millions of dollars to spend on commercials and push strategy marketing in order to get their product into local bars and take over space reserved for a local rum product.
The Context
The demand for the Old New Orleans Rum products is rising in a steady rate. The decision makers are the master distiller along with the CEO of the company. They make decisions based on sales forecast, price of materials, and amount of space in the barrel aging room. The purchasing agent is the master distiller. The master distiller chooses the highest quality ingredients to create the rums with along with the highest quality charred oak barrels. Customers buy because the rums they bottle are different in body, taste, aroma, and alcohol content than other rums. Along with using local ingredients, they use the finest imported vanilla and other spices to create their one-of-a-kind rums that the consumer craves.
Like mentioned previously, the trend of local products is increasing and other local business are more willing than ever to stock local products in their bars and restaurants. Another trend affecting the sales of the products is the city. New Orleans is a destination city, and with that reputation is the drinking culture of the city. There are hundreds of bars and restaurants that are open constantly and offer
access to the rum at any point in time.
There is a demographic shift of wealthier people visiting the city and eventually moving to the city because of the culture and local products that are offered. This shift could provide the extra disposable income to propel the distillery to further success.
The machinery used for the distillery is not state-of-the-art but it is still high tech for the size of operations. Even with the machinery, manpower is a very important part of the distilling process due to sensory details that can only be analyzed by a human. The newer products, in terms, of the stills and piping tend to be used till capacity is maximized or there is extra investment money to increase the capacity and upgrade computing systems to achieve constant liquor production. The upgrades can achieve a more constant product; therefore, the master distiller can focus on other parts of the operation.
The government has very strict laws relating to the product, bottle design, label design, and marketing techniques. As well as the aesthetics and product design, rum is heavily taxed when produced. This heavy taxation causes the distillery to increase prices well above market value in anticipation of the levied taxes. There is no current legislation that will prohibit the marketing of the Old New Orleans Rum products.
The laws and regulations of the United States as well as local and state ordinances have an effect on the growth of the company. The governmental law is anyone over the age of 21 can purchase alcohol of any kind. If the law was lowered, there would be more of a market to enhance growth and profits. In Louisiana, there is no rules or regulations regarding the time and day's alcohol can be sold, which allows for more of the product to be sold and reaching a wider audience than any state that has alcohol bans.