Marketing Plan for Expanding Cagney Farms into Local Direct to Consumer Sales
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The purpose of this paper is to explore and design a marketing plan for a business to transition from mass-market sales to local direct to consumer sales with a focus on low cost marketing. Local direct to consumer sales will involve selling products straight to consumers from the farm with no intermediaries cutting into revenues. Cagney Farms is a family owned farm southeast of Kalamazoo, Michigan. The aim of this paper is to address how Cagney Farms can expand their lamb production business from mass-market auction house sales to direct to consumer sales in the Kalamazoo area to increase profitability and stability. The paper starts with a literature review of the steps involved with expanding into a new market with a focus on the local level. The literature review focuses on identifying consumer preferences, extending brand equity into a new category, market segmentation, differentiation strategies, and low cost marketing methods. Key points from the literature review include organic claims versus local claims and their impact on consumer preferences, previous actions providing brand equity credibility to new expansion, market segmentation processes and financial impact, the need for simplicity in differentiation, and the relationship of different levels of marketing communications and its impact on building brand identity. An in depth analysis of the local food market in Kalamazoo is performed to gather market knowledge and trends. The strength of the local food market is examined on a macro and micro-environmental level. The competition that exists in the Kalamazoo market is broken down and deciphered. Consumers are profiled and segmented to understand better their standards and expectations of products sold on the local level. An understanding of the local food market on a local and national level provides the knowledge necessary to shape the marketing plan to encourage the success of the expansion into the local direct to consumer sales. The marketing strategies are designed to create awareness and induce trial of the product through communicating the product exceeding consumer standards. Relationship marketing, social media marketing, and direct mail marketing will be employed with a focus on higher levels of organization and activity than that of the competition. A review of Cagney Farms' Four P's, a perceptual map, a SWOT analysis, and a cost-benefit analysis will be conducted to identify the vital portions of the business and the impact expansion has on the level of success. Cagney Farms will employ the relationship, social media, and direct marketing methods to communicate the standards of production and product benefits to provide the credibility needed for products to be accepted by local consumers.