Mephisto Marketing

Analysis

For Assignment or Dissertation Help, Please

Contact:
Muhammad Sajid Saeed
+44 141 4045137
Email:
todrsaeed@gmail.com
Skype ID: tosajidsaeed

Page | 1

Table of Contents
1.0 Introduction..........................................................................................................................2
2.0 Evaluating Cost and Benefits of Mephisto Marketing Orientation......................................2
3.0 Environmental Analysis.......................................................................................................3
3.1 Macro Environmental Analysis........................................................................................3
3.2 Micro Environmental Analysis.........................................................................................4
4.0 Developing Segmentation and Targeting Strategy...............................................................4
4.1 Segmentation Criteria.......................................................................................................5
4.2 Targeting Strategy.............................................................................................................6
5.0 Developing Positioning Strategy..........................................................................................7
5.1. Factors Affecting Buyers Behaviour..............................................................................7
5.2 Positioning and Communication Strategy........................................................................7
6.0 Marketing Mix.....................................................................................................................9
6.1 Product..............................................................................................................................9
6.2 Price..................................................................................................................................9
6.3 Placement.........................................................................................................................9
6.4 Promotion.......................................................................................................................10
References................................................................................................................................11

Page | 2

1.0 Introduction
Different definitions of marketing exist but they all surround same concept. The Chartered
Institute of Marketing (CIM) defined marketing as a management process that identifies,
anticipates and satisfies customer requirements profitably (Blythe, 2006, p. 5). On the other
hand according to American Marketing Association (AMA), marketing is an organisational
function and a set of processes for creating, communicating and delivering value to customers
and for managing customer relationships in ways that benefit the organization and its
stakeholders (Boone and Kurtz, 2011, p. 7). The marketing process is completed under pure
marketing concept which states that an organisation must discover the methods to identify the
needs of the customers that are unfulfilled so far. The market research is the first step for
identifying customer needs and analysing potential opportunities. After that an appropriate
marketing strategy consisting of marketing segmentation, targeting, and positioning is
developed for the value proposition. Then the strategic decisions are made, the proposed plan
is executed, and the outcomes are observed.
This report is based on reforming the marketing strategy of Mephisto Products Limited by
appointing a director of marketing. As a consultant, the author addresses different issues in
the current strategy of Mephisto and then suggests suitable segmentation, targeting, and
positioning strategies for the company. In addition, the report also proposes an effective and
appropriate marketing mix for Mephisto when implementing the positioning strategy.

2.0 Evaluating Cost and Benefits of Mephisto Marketing

Orientation
Companies with product orientation approach often face problems in their survival and this is
also evident in the case of Mephisto which is struggling to survive and its level of profit and
sales is declining each year. Mephisto s product orientation strategy is failed because the
company is constantly relying on its traditional electromechanical products to appeal to
customers even in the 21st century when customers are more informed and demanding.
Therefore it is virtually impossible for Mephisto to make CRM work with the productorientation approach. Although Mephisto has a nationwide sales network with well-informed
sales persons, but the company is still losing market share due to its conventional products
that become less relevant to customers now.

Page | 3

In order to achieve success of selling electromechanical control devices with more customercentric approach to knowledgeable customers, Mephisto must adopt a marketing orientation
philosophy rather than sticking to outdated product oriented approach. A marketing
orientation approach refers to entire activities and decisions in any organisation surrounding
customers needs and wants (Sutherland and Canwell, 2008). An adoption of the market
orientation strategy will allow Mephisto to compete other firms within the industry. In
addition to that the company will be able to reduce the chances of newly developed
electromechanical products by conducting effective market research prior to product
development (Lamb et al. 2011). The electromechanical products usually require high costs
(Raffiaeli and Cesetti, 2012) and this is another reason that most of the companies in this
industry address customer need to survive longer and make higher profits compared to those
firms who adopt product or production oriented approach. Marketing research is an important
element of market-oriented approach that will allow Mephisto to identify changing tastes.
In adopting a market-orientation approach, Mephisto must also carefully consider some
points to avoid probable risks. For example, excess or constant market research requires high
costs that may result in lowering down the companys profit margin (Sutherland and Canwell,
2008). If the company will target other industries apart from the chemical industry, the
marketing orientation strategy could be hard to follow due becoming familiar with a variety
of consumers.

3.0 Environmental Analysis

3.1 Macro Environmental Analysis
The PEST analysis framework is used in this report to analyse macro environment of
Mephisto (Reeve, 2002).
The UK Government imposes different tariffs, trade limitations, environmental restrictions,
licensing requirements, and consumer safety regulations on firms producing electronic and
mechanical products (www.gov.uk). Mephisto should be aware of all these regulations before
producing or trading products nationwide or at international level. Adverse economic
conditions due to the recent economic downturn are also one of the foremost reasons that
affect the sales and profitability of Mephisto . The sociocultural impact is highly significant
for Mephisto because in this modern era of technology people like to use latest equipments
Page | 4

and machinery and the company lacks in producing innovative technological equipments.
Finally, in the era of 21st century the demand of buyers changes rapidly due to an extensive
use of latest technological equipments evident in internet and other media (Voinea and Filip,
2011).

3.2 Micro Environmental Analysis

Porters five forces model is the appropriate framework to conduct micro environmental
analysis of any company (Reeve. 2002). The Porters five forces analysis of
electromechanical industry is conducted where Mephisto operates.
The threat of new entrants is very high for Mephisto as new firms can easily enter into
electromechanical industry by introducing new technologically sound products. These new
companies do not often require high investments, high sunk costs, or strong brand image.
Likewise, Mephisto can face a considerable threat from the firms producing substitute
products with same or less price with advanced technology. The impact of bargaining power
of suppliers is low as there are numerous suppliers of modern equipment in the market and
Mephisto can pressurise them to cut volumes of raw material orders. The bargaining power of
buyers is very high for Mephisto due to the existence of several competitors in the electronics
market. Similarly, there is a widespread rivalry exists in the electronics products and
therefore Mephisto should be careful in formulating strategic policies.

4.0 Developing Segmentation and Targeting Strategy

Selling 95% products to chemical industry shows absence of any market segmentation
strategy of Mephisto . The adoption of appropriate market segmentation will result in several
benefits for the company. For example, Mephisto will get a better opportunity to develop new
or reshape existing products by greatly recognising the requirements, behaviours, and
attitudes of technical customers (Cheverton, 2004). Furthermore, the segment based
marketing will add value to Mephistos ability to manage its marketing mix effectively and
ultimately the company will achieve a competitive edge, optimal return on investment,
customer delight, and loyalty.

Page | 5

4.1 Segmentation Criteria

McDonald (2012) explains the general criteria for identifying business segments using the
segmentation matrix. The segment criteria for any product can be based a range of the
segment groups including geographical location, technology, buyers, demographics,
psychographics,

and

buying

behaviours.

The

segment

criteria

for

Mephistos

electromechanical products is defined in table 1 which illustrates four different dimensions of

the segment groups.
Table 1 Segmentation criteria

In the above table, geographical zone, technology, and industrial segment groups for
electromechanical products are understood. However, Mephisto needs to select a buyers
segment as a part of the marketing orientation strategy. Therefore, the business buyers of
Mephisto products are divided into three significant segments such as economic buyer,
technical buyer, and user buyer (Miller et al. 2004). The Mephisto can choose a technical
buyer segment as they are often responsible of buying electromechanical products that fits to
technical requirements and specification for the company. Economic buyers are usually not
involved in buying process but they have the power to approve the deal. Mephisto should not
be interesting selling products directly to user buyers because it is sometimes hard to explain
the technical details of the product.

Page | 6

Figure 1: Business buyer segments

Source: Berthiaume et al. (2007, p. 68)

A market segmentation matrix in table 2 illustrates the rationale and justification of the
selected segment on the basis of desired outcomes and maximum score.

Table 2 Segmentation matrix

Source: McDonald (2012)

4.2 Targeting Strategy

Three targeting strategies described by Boone and Kurtz (2011) are undifferentiating,
differentiated, and concentrated. Mephisto can adopt a concentrated strategy for targeting
well-informed technical buyers from chemical, technical, engineering electronics, mechanical
industries. Mephisto cannot adopt undifferentiated strategy as the company is unwilling to
pass on similar message to every buyer. Similarly, differentiation strategy is product oriented
and therefore not recommended to Mephisto (ibid).

Page | 7

5.0 Developing Positioning Strategy

Before developing an effective positioning strategy it is important to discuss the factors that
influence the buyers behaviour of Mephisto customers.

5.1. Factors Affecting Buyers Behaviour

The buying behaviour of industrial buyers is different from those of consumer buying
behaviour. These factors can be categorised into four significant categories such as
environmental, organisational, interpersonal and social factors, and individual (Roy and
Sivakumar, 2007) as shown in figure2. In case of Mephisto, the technology used in producing
electromechanical products is the major factor that can influence the buying behaviour of
industrial technical buyers. In addition, demand and price are also the key drivers of changes
in buying behaviour of technical buyers.
Figure 2 Factors affecting industrial buying behaviours

Source: Roy and Sivakumar (2007, p. 223)

5.2 Positioning and Communication Strategy

The positioning strategy of Mephisto should be unalike from the strategies adopted by its
competitors (Graham, 2008). The products can be positioned on the basis of different
positioning options. With electromechanical innovative products, the positioning strategy of
Page | 8

the company should be based on customer target, industry target, competitor target, product
value proposition, and geographical zone (Havaldar, 2010). Table 3 demonstrates positioning
strategy of Mephisto on different targets basis.
Table 3 Positioning strategy

The positioning strategy also requires an effective communication plan to notify, convince,
and remind buyers about the products. Table 4 illustrates an effective communication strategy
to interact with technical buyers.

Table 4 Communication strategy

Page | 9

6.0 Marketing Mix

The marketing mix framework has gained a considerable success since 1964 when Jerome
McCarthy developed 4P (Product, Price, Placement, and Promotion) elements of marketing
strategy (Leadley and Forsyth, 2004). An effective and appropriate marketing mix for
Mephisto in the context of implementing a positioning strategy is as follows.

6.1 Product
In electromechanical industry, the product embraces the quality, variety, design, packing,
features and any other related service e.g. free delivery to customers as per their needs and
demands (Alipour et al. 2012). In developing an effective marketing mix, Mephisto should
manufacture and introduce quality products with different variety of resistors, inductors,
switches, motors, capacitors, and transistors to gain competitive advantage and also to
increase its market share. In addition, the design and features of each product should be
unique and according to the basic needs of the customers. For example depending on design
and features, an inductor is the device that can be used with filters, sensors, transformers, and
motors in a variety of ways. Therefore, Mephisto can concentrate more on the design and
attributes of inductors to compete in the market.

6.2 Price
Price can be described as the amount of money that customers pay to buy the product. In
economic theory, lower prices of the products tend to increase sales and result in higher
profitability. There is a lot of variety in the prices of electromechanical products depending
on their costs, functionality, and features. As Mephisto is currently trying to re-establish its
position in the market, so the company can employ market-oriented pricing strategy
depending on the results from the market research to reflect upon organisational objectives
and market conditions. In this way, Mephisto can set the prices lower from its competitors to
achieve considerable market share (Schindler, 2011).

6.3 Placement
A placement (or distribution) strategy allows consumers to reach and purchase the product
conveniently (Alipour et al. 2012). The placement strategy should be aligned with companys
STP decisions as well as the pricing strategy. For example, to make distribution network
Page | 10

stronger, it could be a positive step for Mephisto to provide licences to retailers and dealers of
electrical products suppliers rather than totally relying on its sales force. In addition, the
company is recommended to use intensive distribution strategy to place its products in
several different locations by offering low prices. This strategy will be beneficial for the
Mephisto and its retailers in terms of profit, and for the customers in terms cheap price and
impulse purchase.

6.4 Promotion
Promotion includes all actions that marketers perform to provide all essential information
about companys products to customers to motivate them for buying the products (Leadley
and Forsyth, 2004). Initiating and continuing promotional campaigns are not easy for
Mephisto as it has the image of producing traditional products. Therefore, the company needs
to adopt both pull and push promotional strategies to quickly promote its products. Following
a pull strategy, Mephisto can adopt an excellent approach of advertisement with a new
sound slogan such as new ear, new technology, new products on billboards, signboards,
ratio, TV, brochures, and newspapers can bring the company back to the competition. In these
days, social media is playing a vital role in developing public relations; therefore it is
suggested to Mephisto to run promotional campaigns on Facebook, Twitter, MySpace, and
other similar type of social media sites. Apart from these networks, LinkedIn could be
beneficial for Mephisto to establish relationships with professionals and companies in the
targeted industries. On the other hand, Mephisto can adopt a pull strategy using existing
informed sales force to target potential retailers and wholesalers in different industries.

7.0 Summary
This brief report addressed several issues associated with current marketing strategy of
Mephisto who manufacture electromechanical products and distribute all around the UK. It is
recommended to the company to develop new innovative products according to the taste of
the customers and then target technical buyers in chemical, technical, engineering electronics,
mechanical industries. Companys effective positioning strategy must be based on customer,
market, competitor, product value, and geographical zone. The strategy must be
communicated using a range of communication tools and methods. Finally, it is
recommended to Mephisto to develop unique products with desired features and establish low
prices by adopting market-oriented pricing strategy. Further the products will be promoted
Page | 11

using both pull and push strategies and then intensively distributed to retailers and
distributors.

References
Alipour, M., Moniri, S.M., Shareghi, B. and Zolali, A. (2012). Ranking the marketing mix elements
affect on the behaviour of industrial electrical heaters consumers: case study of Kaveh Industrial City.
Middle-East Journal of Scientific Research, 12(11), pp. 1560-1565.
Berthiaume, R., Joshi, B., Longdo, E. and Seshadri, V. (2007). Toyota Marketing Strategy for Plug-in
Hybrids. Berkeley-Columbia: Wessex Press
Blythe, J. (2006). Principles and Practice of Marketing. Cengage Learning EMEA.
Boone, L.E. and Kurtz, D.L. (2011). Contemporary Marketing. 15th edition, Cengage Learning
Cheverton, P. (2004). Key Account Management: A Complete Action Kit of Tools and Techniques for
Achieving Profitable Key Supplier Status. 3rd edition, Kogan Page Publishers
Graham, H. (2008). Marketing strategy and competitive positioning. 4th edition, Pearson Education
India.
Havaldar, A. (2010). Business marketing. 3rd edition, Tata McGraw-Hill Education
Lamb, C.W., Hair, J.F. and McDaniel, C.D. (2011). Essentials of Marketing. 7th edition, Cengage
Learning
Leadley, P.J. and Forsyth, P. (2004). Marketing: essential principles, new realities. Kogan Page
Publishers
McDonald, M. (2012). Market Segmentation: How to Do It and How to Profit from It. John Wiley and
Sons.
Miller, R.B., Heiman, S.E. and Tuleja, T. (2004). The New Strategic Selling: The Unique Sales System
Proven Successful by the World's Best Companies. 3rd edition, Kogan Page Publishers
Raffiaeli, R. and Cesetti, A. (2012). Virtual planning for autonomous inspection of electromechanical
products. International Journal of Interact Design and Manufacturing, 6, pp. 215-231.
Reeve, R.N. (2002). Introduction to environmental analysis. John Wiley & Sons
Roy, S. and Sivakumar, K. (2007) The role of information technology adoption in the globalization of
business buying behavior: a conceptual model and research propositions. Journal of Business &
Industrial Marketing, 22(4), pp.220-227
Schindler, R.M. (2011). Pricing strategies: A marketing approach. SAGE Publications.
Page | 12

Sutherland, J. and Canwell, D. (2008). Essential Business Studies A Level: AS Student Book AQA.
Folens Limited
Voinea, L. and Filip, A. (2011). Analyzing the main changes in new consumer buying behaviour.
International Journal of Economic Practices and Theories, 1(1), pp. 14-19.
www.gov.uk/importing-and-exporting-electronic-goods

Page | 13