Marketing Paper on Memo to the President of Al Sagrain

To: The President, Al Sagrain Company

From: Al Sagrain Marketing Consultant

Subject: A Report on the Market Gap Audit Conducted for Al Sagrain

This comes as a report to the recently concluded market gap audit that we conducted at Al- Sagrain Company. The objective of the market gap audit was to determine the level of efficiency of service delivery based on various key business elements. In this regard, the marketing consultants group that conducted this exercise was supposed to identify the differences between the customer expectations and what the business provides. The overall perception that was established through the exercise was that the sole objective of Al Sagrain should mainly be on creating a new customer base after shifting business locations. The company may not know exactly what the customer expectations are without initially acquiring new customers. To better understand this concept, the business was audited through the tenets of business environment, customers, place, the price and cost, products and services and the promotional activities of the business.

In terms of the business environment, Al Sagrain has been operating in the same location for more than 24 years. This implies that there had been a lot of customer relationships with the company. This has since changed as the company has shifted its business location. Being a profit oriented business; such a change in operations was bound to result in a dip in profitability. Moreover, the business environment is constantly changing, resulting in new car models hence the need for the operators of Al Sagrain to change with the times. There are other differences between Al Sagrain’s current location and business environment and the former location, which the company should take, note of to ensure that growth is achievable in the new area. More information on the business environment can be sought from the environment subheading in page 2 of the general report.

Another facet of the business that we looked at was the customers. In the past, the company had established lasting relationships with several key customers, whom it could depend on for sustained profitability. Al Sagrain, just like any other profit based business, has the primary objective of attracting as many clients as possible since it is through the clients that demand for services, and subsequently profitability is created. The audit aimed at identifying the past and present customers to the company and noting how they could possibly be persuaded to continue seeking the services they sought from the company before. By understanding the demographics of the customers, suitable marketing and promotional activities can be designed by the company for reaching them. Page 2 of the general report provides a detailed description of the customer profiles for Al Sagrain under the customer subheading.

Following the audit, certain recommendations were made on how the company can acquire more customers and even retain customers from the previous business location. Some of the recommended strategies include offering discounts and providing longer warranties for various services. Further information on how to accomplish each of these recommendations is listed under the subsection on customers in the general report on page 3. The objective of the business owners should therefore be to find sustainable approaches for attracting customer loyalty. The company needs to attract new customers more than they need to keep existing ones, especially due to change of location, which has reduced the number of customers visiting the shop.

Al Sagrain provides a variety of products and services to its customers. From the audit reports, it is clear that most of the company resources, particularly in terms of inventory storage go to wheel repairs and changes. The question that the business owners need to ask now more than ever is whether the products and services they are providing to customers are needed. For instance, the audit showed that compared to the past location where the business had an entire block for its own use, there are several other businesses offering the same products and services as Al Sagrain in the new location. This implies that the company’s business model has to change. There has to be a differentiating factor between the value proposition given by the other businesses and what Al Sagrain will be offering the customers. Identifying customer needs would be a crucial step towards achieving greater sustainability.

The business owners need to determine what most customers look for in that locality. This would help them to understand the customer needs and thus channel the available resources appropriately. The audit report on page 3 under the products and services sub-heading, has provided other suggestions through which the business owners at Al Sagrain can implement to help in the journey towards differentiation. The customer needs at the new location may be different from those in the previous location due to availability of other services from the competitors.

The impacts of the business location will definitely be felt by the company for some time, at least until it stabilizes. This however depends on the strategic actions of the company. From the audit it was established that the business was initially located at a convenient location where it was able to provide services to most of its customers. A change in business location can be straining to any company since part of the good will initially established is lost in the process. The same has occurred at Al Sagrain and it may take time for the business to gain as much good will as it had gained in its 24 years of operations at the previous location. The business should therefore focus on optimizing the currently available location by providing services and goods that customers may not get easily at other places. Furthermore, giving a good bargain is another strategy for introducing a new business location to customers. The proprietors at Al Sagrain should therefore focus on implementing some of the suggestions made under the sub- heading of place on pages 3 and 4 of the general report.

Besides the aforementioned factors, the company needs to look at the price of the products and services sold and also to engage in promotional activities. Al Sagrain currently prices its products and services below the competition. This however raises concerns about sustainability of the business operations. In as much as the company is making efforts towards acquiring new customers, they should understand that this can only work if the lower prices are sustainable over the long run. The only way to achieve this is by ensuring that service delivery costs do not go beyond profitability thresholds of the business. The company owners have to renegotiate with suppliers and other stakeholders to provide parts at affordable costs, explaining the relocation and how it has impacted negatively on business operations. It is only in this way that the company can continue providing low cost goods and services sustainably.

The subject of promotion should also come into the organizational plans for Al Sagrain. In a new location, promotional activities can help a service oriented business such as Al Sagrain to create a customer force around it. So far, the company is performing well in terms of creating awareness of the relocation and mobilizing its work force to speak for the company. However, more can be done as discussed under the promotion sub- heading of the general report. Additionally, the company is focusing on its process and the competition. Four major competitors have been identified. Similarly, the competitors’ strengths and weaknesses have been understood by the people at Al Sagrain. The way around succeeding in the business is by setting oneself apart from the pack through effective pricing and operations process. Through a rigorous process of documentation and service delivery, Al Sagrain avoids potential pitfalls of confusion and failure to deliver services in time. Additional information on the steps that the company can take to further strengthen its position in the market relative to competitors can be found on pages 7 and 8 of the general report under the process and competitors sub-headings.

Based on the audit findings therefore, it can be deduced that Al Sagrain is on the right path towards regaining its lost glory. The steps taken by the proprietors so far are indications of willingness to commit to the process of rebranding and re-strategizing. The audit committee, in submitting this memo and report to the president of the company, is committed to help in any way that it can to ensure that the company overcomes its present challenges.

 

Yours Sincerely,

Student Name

Marketing Consultant.