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 MARKETING PLAN

SWAN JET ADVENTURES


     PREPARED BY:
  PATRICK GALLAGHER
      SION KARTA
   ANNA MULHOLLAND
  MARIA PAULA VASQUEZ




                            



                        Page 1
EXECUTIVE SUMMARY
Swan Jet Adventures, a Perth-based commercial boating company, offers an adrenaline jet
boat ride service that has been running operations on Barack Street jetty since 2007. In the
past year, their profit has expanded from $10,595 (3.91% margin) to $29,754 (10.63%), but
there still is a major lack of brand awareness. Swan Jet currently has a position in the niche
customer market of „adrenaline activities‟, with Swan Jet striving to develop further its focus
differential position in the market.

External Environmental & Critical Success Factors:

Macro and Micro environmental research indicates that Swan Jet is operating within an
environment that would support the growth of Swan Jet. Factors in the external environment
that Swan Jet need to monitor include, West Coast Jet highly discounted prices, relationship
with Swan River Trust and commercial boating regulations and restrictions.

There are three critical success factors that Swan Jet‟s director needs to monitor closely.
These factors are:

    1) The ability of Swan Jet to maintain and increase its customer numbers
    2) Ensure the continued quality and safety record of Swan Jet
    3) Improve the level of customer satisfaction and customer loyalty amongst Swan Jet
       customers.

Objectives:

The overall objective for Swan Jet is growth of the business, mainly through the increase of
customer numbers by 50%. Marketing objectives include

   Increase brand awareness by 30%
   Evaluate their target market segments and monitor specific strategies to grow each
   Focus more attention on short term marketing strategies to increase customer numbers to
    assist the company‟s financial growth and capital which will fulfil its long-term objective
Strategies:

   SEO & PPC targeted internet marketing
   Increase distribution channels
   Social Media marketing




                                                                                         Page 2
TABLE OF CONTENTS
EXECUTIVE SUMMARY ............................................................................................................................................ 2

SITUATION ANALYSIS .............................................................................................................................................. 4

MACROEVIRONMENTAL ANALYSIS ......................................................................................................................... 4

MICROENVIRONMENTAL ANALYSIS ........................................................................................................................ 7

   INDUSTRY-MARKET REVIEW ............................................................................................................................... 7

   CUSTOMER REVIEW ............................................................................................................................................ 8

   COMPETITOR REVIEW ......................................................................................................................................... 8

   DISTRIBUTOR REVIEW ......................................................................................................................................... 9

   SUPPLIER REVIEW ............................................................................................................................................. 10

SWOT ANALYSIS .................................................................................................................................................... 11

MARKETING OPPORTUNITY ANALYSIS .................................................................................................................. 11

CRITICAL SUCCESS FACTORS ................................................................................................................................. 12

OBJECTIVES & HIGHER LEVEL STRATEGIES ............................................................................................................ 13

   STRATEGIC GAP ANALYSIS ................................................................................................................................. 13

   ANSOFF’S PRODUCT-MARKET STRATEGIES ....................................................................................................... 13

   SMART OBJECTIVES for Q2 2010- Q2 2011 ....................................................................................................... 15

MARKETING MIX ................................................................................................................................................... 16

   POSITIONING & SEGMENTATION ...................................................................................................................... 16

   CUSTOMER SEGMENTS ..................................................................................................................................... 17

   SEVEN P’s OF SERVICE’S .................................................................................................................................... 19

BUDGET ................................................................................................................................................................. 24

IMPLEMENTATION, EVALUATION & CONTROL ..................................................................................................... 25

   ACTION PLAN .................................................................................................................................................... 25

   KEY PERFORMANCE INDICATORS (KPI) ............................................................................................................. 26

RECOMMENDATIONS & CONCLUSION ................................................................................................................. 26

APPENDIX .............................................................................................................................................................. 28

REFERENCES .......................................................................................................................................................... 30




                                                                                                                                                              Page 3
SITUATION ANALYSIS
BUSINESS DEFINITION
Swan Jet Adventures (Cruise WA PTY LTD) operating since 2007 from Barrack Street Jetty
on Perth´s Swan River is a small business operation, with large market potential that currently
entertains approximately 5,500 people every year. The company has six employees, including
jet boat skippers, an engineer, and part-time customer service personnel. The main service
offered by Swan Jet is a 25 minute jet boat ride experience for up to 14 passengers on the
Swan River, whom experience the thrills and excitement of an adrenaline jet boat which
reaches speeds up to 80km/h and does continuous 360 degrees spins to keep hearts racing.
Swan Jet offers gift vouchers and merchandise products for purchase, while diversifying its
services to include experience packages of parasailing, helicopter rides, and Harley Davidson
tours to promote the whole Swan Jet experience.

MISSION STATEMENT
The Swan Jet mission statement is “To deliver an exhilarating fast and fun jet boat adventure
while demonstrating our duty of care to our customers, other river users and the unique
environment of the Swan River”.
MACROEVIRONMENTAL ANALYSIS

DEMOGRAPHIC
POPULATION GROWTH & AGE AND SEX DISTRIBUTION
To date, the Australian population in March of 2010 reached 22.2 million, with the population
in WA reaching 2,286,100 along with a growth rate of 2.3% representing the highest increase
in Australia1. The majority of states had a positive increase as a result of migration and
natural population growth, with WA in which Swan Jet operates experiencing the strongest
population growth2. In WA the median age is 36.2 years with WA and Queensland both
having the highest growth of 13.8% in the 15-64 age categories. From June 2009 there were
11.02 million females in Australia, compared to 10.93 million males, with WA and Northern
Territory consisting of more males than females1.
EDUCATION TRENDS
In 2008, there were 3.4 million students in Australia, with 17% of students involved in higher
education and the number of Australian‟s with vocation or higher education qualifications has
been increasing over the past 10 years from 43% to 69% of the total population aged between
25-62 years3. This increase can be linked to the growing significance of educational
qualifications to support employment2 and WA also showed an increase in higher education
overseas students, moving from 14.9% in 1998 to 32% in 20083.




                                                                                        Page 4
AGE PYRAMID 4




(Source: Compiled from Year book Australia 2009-2010 modified by author)
SOCIOCULTURAL
Family, community life and sporting activities are important elements of the Australia society
with the later representing and population increase from 55% in 2000 to 65% in 2006. The
principal reasons for exercising were heath and leisure, followed by social and family
wellbeing. The proportion of adults attending sport events was 44% on 2006, which remained
stable from 2005 4.

ECONOMIC
Swan Jet customers consist of 75% local West Australians and as a leisure activity, the
condition of the state and country economies can impact the levels of business and disposable
income. Graph A represents how the Global financial crisis (GFC) at the end of 2007 affected
the Australian GDP growth rate and illustrates the steady decline during 2008 as a result of
the GFC. However as demonstrated in Graph A, Australia is slowly gaining momentum in
GDP growth rate and is experiencing approximately 3.2% GDP growth rate in Q3 2010.

GRAPH A




Source: Trading Economics 2010
WA has been a relatively strong economy and from 2006 onwards, WA‟s Gross State Product
(GSP) has been above the GDP growth rate for Australia. Aside from a drop in WA‟s GSP in
2009 compared to Australia‟s GDP, since March 2010 WA‟s GSP has been 5% while
regaining its momentum, and showing a stronger performance than Australia‟s GDP of 2.7%
growth in March 20105.




                                                                                       Page 5
GRAPH B




          Source: Access Economics Cited by Westpac, Q2 20106

ENVIRONMENT
Since 1989 the Swan River Trust has been the regulation authority in charge of the protection
and management of the Swan River and the surrounding lands7. The principal environmental
concerns as a result of increases in boating activities are the hydrocarbon contamination and
general water contamination by pollutants, metals and oils8. The Swan River Trust is vital to
Swan Jet‟s business as they control the awarding of commercial boating licence, restrictions
and boat maintenance practices on the Swan River9,

POLITICAL-LEGAL
As a result of the federal election in August 2010, Australia now has a Labor government and
a Liberal State government. The main legal and political influences affecting Swan Jet are
listed below.
 The Australian Competition and Consumer Commission10 was formed in 1996 to
   administer the trade practices Act 1974 and other acts to promote competition and fair
   trade in the marketplace to benefit consumers, business and the community.
 The Labour Government 11 plans to introduce a tax relief of instant write offs for small
   business assets worth up to $5000, meaning many small business investments can be
   written off in the year of purchase. Swan Jet will be eligible for the tax relief plan
   resulting in additional cash flow for business operations and marketing.
 The Swan and Canning Rivers Management Act 200612 came into effect to improve the
   processes for assessing development proposals and decisions on Swan River activities.
   The form 6 license13 is required for all activities proposed in the River Reserve, such as a
   commercial charter vessel and ferry operations for financial gain or reward through the
   Swan River Trust. Swan Jet Adventures received their license before any renewal
   regulations were brought in, so their license is a 30-year exclusive license agreement.




                                                                                        Page 6
TECHNOLOGY
Swan Jet can benefit from technological advancements in Jet engine fuel efficiencies and
distribution technology. In four years time when Swan Jet‟s jet engines need replacing Swan
Jet should consider jet boat engines that provide greater fuel efficiencies and horse power
which will contribute to enhanced customer experience as it provides more thrill and
reductions in fuel costs. Distribution platforms such as mobile and internet bookings are
something the company can look into. However, the company might experience technology
lag due to restricted capital and may wait to hold off on new technology until price decreases
MICROENVIRONMENTAL ANALYSIS

INDUSTRY-MARKET REVIEW
Swan Jet Adventures operates within the recreation boating industry in Perth in which the city
is experiencing a growing population due to a stable economy and the healthy coastal
environment. The Swan and Canning Rivers are at the centre of the boating industry due to its
facilities with year-round water activities and the numbers of boats ownerships in Perth have
been increasing in a rate faster than the growth of population (Appendix A)7. Furthermore, the
increase in the numbers of recreational boats are a result of the growth in the population along
with the raise in the popularity of boating activities with the retired population which is
expected to double by 2025 (Appendix B)14. The forecast from 2007 to 2025 predicts that the
population in Perth will grow to a rate of 30%, while the number of recreational boats is
expected to increase 82% in the same period of time (Exhibit A)7. Perth needs to increase its
boating facilities to handle the expected addition of 4,600 boats moorings and 34 boat ramps
in Perth7.
EXHIBIT A 7– FORECAST RECREATIONAL BOATS TO 2025




                    (Source: Department of Planning and Infrastructure of WA 2008)

The tourism industry in Perth plays a key role in facilitating tourism and business activities to
Western Australia. In 2009, WA represented 10.6% of the total international visitors‟
expenditure in Australia, and 5% of interstate visitors‟ expenditures with 695,000
international visitors (13% increase since September 2004), 895,000 interstate visitors (14%
decline) and 4.4 million intrastate visitors. According to the Tourism Forecast Committee,
Perth expects an increase of 4.3% international visitors and a decline of 0.2% domestic
visitors while the WA regions expect a 6.6% increase of international visitors and a decline of

                                                                                          Page 7
1.8% domestic visitors over 10 years14. The increases in the popularity of the recreational boat
activities and tourism represent an opportunity for Swan Jet Adventures from the potential
increase of the target market.

CUSTOMER REVIEW
The target market for Swan Jet services are males and females between the ages of 21-40
years that enjoy activities involving outdoors, water activities, thrills and adrenaline such as
young professionals and university students. Additionally, Swan Jet has also had some
corporate customers who booked the Jet boat for company events and sales promotions
rewards. Initially the Swan Jet believed that international visitors were their main customer
segment however this is not the current case as up to 72% of customers are local Western
Australians.

A survey of a small sample size of 50 Swan Jet customers was undertaken, to determine the
accuracy of the target markets. Graph A below show support for the target demographics of
Swan Jet customers but were limited due to the sample size and that the peak season was just
beginning.


GRAPH A




(Source: Compiled from survery data, modified by author)
COMPETITOR REVIEW
Swan Jet Adventures is the only company operating commercial jet boating on the Swan
River, however due to the adrenaline nature of the experience; it has both direct (water based)
and indirect competitors. Direct competitors are those that offer water based and adrenaline
experiences in the CBD and surrounding tourist areas, with indirect competitors including
non-water based activities such as laser games and go-karting. For the scope of this marketing
plan, Swan Jet Adventures has requested that focus be on direct competitors.

The Perth area initially had three companies offering jet boat services to customers; however
in 2009 the third competitor in Hillary‟s Boat Harbour closed its operations. West Coast Jet in
Fremantle is Swan Jet‟s main competitor. Although both companies offer jet boat rides, the
experiences are quite different due to the tour locations in the Indian Ocean and Swan River.


                                                                                         Page 8
The sustained competitor advantage for Swan Jet is the owner‟s relationship with suppliers
      and several distributors due to their exemplary reputation in the Perth commercial boating
      industry.

      As all of Swan Jet‟s competitors are private companies no data was available on the market
      share of each competitor. Please see the table below for a list of Swan Jet Adventures
      competitors.
                                                          Main Competitors:
Name:       Strengths:                                    Weakness:                                                Target Customer:
WATER BASED ACTIVITIES:
West Coast   Can seat 20 passengers – larger boat         Unable to do 360 degree turns.                          Adrenaline experience
Jet -        Offers Whale Watching and Jet Boat           Lower Barrier to Entry (operating licence)               customers
Fremantle     tours                                         20 minute trip compared to Swan Jet‟s 25 minute        Corporate customers
             Operates on the Indian Ocean                 Children $5 more expensive than Swan Jet.               Male & Female 20-40
             Offers family price package                  Two tours completely separate (no high speed turns       yrs
             Offers photographs and gift vouchers          on Whale watching trip).                                Low physicality
             Fremantle is a popular tourist and local     Unable to book online.
              destination
South Perth  Sole Parasailing operator in Perth on the      Weather dependant                                     Experience customers
Parasailing   river                                          Unable to receive photos on the day                   Male & Female 20-50
– South      Offers two types of rides “High & Dry”         High price $80 for 10 minute ride                      years
Perth         or “Wet-n-wild”                                Depending on rider numbers, rider‟s group may have
             Custom built parasailing boat                   to wait on foreshore (thus solo experience)
             Offers single and tandem rides
Extreme Ski  Offers several services, Water tubing /      Weather dependant                                       20 – 40 years
WA – South    skiing / wakeboarding                        High physicality                                         experience customers
Perth        Max 2 day trips (overnight                                                                            Groups - parties
              accommodation)
             Quality equipment and instructors
Captain      Offer variety of wine, scenic, lunch,          Large overheads (seven boats)                         30 + year age groups
Cook          dinner and special event tours along the       High jetty fees                                       Interstate and
Cruises –     Swan River and Indian Ocean.                   Aging boat fleet                                       International
Barrack St                                                   More expensive than Golden Sun                         sightseeing tourist
Jetty
Golden Sun   More personal tours than Captain Cook        Limited passenger numbers (smaller boats than           Interstate and
Cruises –     cruises                                       Captain Cook Cruises)                                    International tourist
Barrack St   Entertainment commentary                     Less tour variety                                       30+ year
Jetty

      DISTRIBUTOR REVIEW
      Swan Jet Adventures distributes its product of service through three different distribution
      channels of booking agents, direct distributors and internet retailers encompassing zero and
      one-level marketing channels.
      Distribution Channel Process




      In the zero-level, Swan Jet distributes its services directly to the consumer through an on-site
      ticket counter at its Barack Street Jetty office as well as through phone and e-mail bookings.
      In the one-level channel, Swan Jet distributes its service through a booking agent and multiple
      internet retailers (Table A and Appendix D) showing that Swan Jet is in the process of


                                                                                                                   Page 9
shifting its distribution channel towards an online model which reduces costs and allows for
higher inventory levels to intermediaries with an extensive network of customers. West Coast
Jet is applying downward pressure on prices by offering a 2 for 1 discount, which is reducing
profit margins for the Swan Jet and the boating industry but Swan Jet has moved to a higher-
traffic location with great visibility which should impact its distribution channels.
Table A: Swan Jet Distributors and Channels
Distributor      Type of Distribution Channel          Description
Adrenaline       Internet Experience Gift Retailer    Australia's largest adventure company, with over 2,000 exciting experiences &
                                                       gifts to choose from throughout Australasia.

FreemanX         Internet Experience Gift Retailer    Australia‟s leading experience company that offers the fastest, highest, most
                                                       daring, most romantic and most life changing experiences available
Netbookings      Internet Experience Gift Retailer    Luxury accommodation, day spas and experiences within Australia

Redballoon       Internet Experience Gift Retailer    Australia‟s leading internet gift retailer offering gifts and experiences.
                                                      Individual and Corporate Customers
Swan Jet         Direct Distributor                   On-site ticket counter
                                                      Phone and e-mail sales
Scenic Tours     Booking Agent                        Leading experts in luxury travel throughout Australia that provides a truly
                                                       authentic experience that discovers all the famous 'must-see' sites and natural
                                                       attractions.

GoDo Australia   Internet Experience Retailer         Leading online booking service for activities who works with hundreds of
                                                        activity suppliers across Australia so people can book instantly
BigThanks        Internet Gift Retailer               Internet gift retailer for any person for any occasion that offers the most
                                                        interesting, fun, unusual and unique gifts from around Australia.

SUPPLIER REVIEW
Swan Jet‟s supplier channel includes a mixture of seven different companies that impact
Swan Jet‟s business (Graph A). In terms of the marketing plan Baileys Marine Fuels and
Totally Work Wear are the two main suppliers that impact Swan Jet‟s business whereas
Harley Tours, Heliwest and South Perth Parasailing are exclusive strategic partnerships.

GRAPH A SWAN JET SUPPLIER CYCLE




(Source: Compiled by author)


                                                                                                                Page 10
SWOT ANALYSIS




(Source: Valentin15 2001, modified by author)

MARKETING OPPORTUNITY ANALYSIS
                                             Opportunity Matrix for Swan Jet Adventures:
                                                            Success Probability:
   Attractiveness:




                               HIGH                                      LOW
                      HIGH     - Opportunity Two                         - Opportunity Three
                               - Opportunity Five [Monitor]
                               -Opportunity Seven [Monitor]
                      LOW

The only marketing opportunities mentioned in the opportunity matrix are those that Swan Jet
has the capabilities and resources to implement, can be communicated and beneficial to the
target market and be implemented better than any competitors 30.

 1. Opportunity Two: 72% of customers are local with a 30% customer referral, but low
                     repeat business, so this opportunity could increase repeat customers and sales numbers.
 2. Opportunity Five: An efficient targeted marketing approach would be beneficial as
                     currently Swan Jet has no clear structure to marketing strategies or budget allocation.
 3. Opportunity Seven: This opportunity would decrease customer processing time before
                     rides, as well as decreasing the level of lost revenue from customer no shows.




                                                                                                       Page 11
4. Opportunity Three: New distribution channels in areas of high local and international
                 consumer traffic such as Hillary‟s Boat Harbour, Rottnest Island and Fremantle, would
                 help increase consumer awareness of Swan Jet as well as increase sales.

                                           Threat Matrix for Swan Jet Adventures:
                                                   Probability of Occurrence:
  Seriousness:




                            HIGH                                     LOW
                  HIGH      -Threat One [Monitor]                    - Threat Two
                            -Threat Five                             - Threat Three
                            -Threat Six [Monitor]
                  LOW                                                - Threat Four

 1. Threat One: This threat is currently occurring as West Coast Jet who is Swan Jet‟s
                 direct competitor is currently offering 50% discounts on all rides.
 2. Threat Five: Both the cost of fuel as well as location rent have a high probability of
                 increasing due to a strong Western Australian economy, impacting on profit margins.
 3. Threat Seven: Swan Jet Adventures meets all the required safety regulations as well as
                 employing highly trained and experienced skippers, however mechanical and equipment
                 failures are always a threat.
 4. Threat Two & Three: A major strength for Swan Jet Adventures is the unique licence it
                 possesses from the Swan River trust for 20 years. High licensing entry barriers decrease
                 the probability of new competitors.
 5. Threat Six: As barrack street jetty is a commercial jetty for other large boating
                 companies and a main source of water transport up and down the river, the seriousness is
                 low due to larger companies high stakeholder influence.
 6. Threat Seven: Swan Jet already experiences speed restrictions in the area where further
                 development would occur, thus its impact on the ride would be minimal.

CRITICAL SUCCESS FACTORS
1. The ability of Swan Jet Adventures to maintain and increase customer numbers.
                 A change in Swan Jet operations location, potential increases in fuel prices and main
                  competitor offering highly discounted pricing, Swan Jet needs to increase their
                  customer numbers to cover its expenses. If the competitor pricing threat remains long-
                  term then Swan Jet risks losing interested customers and incurring cash flow issues.
2. Ensure the high safety record of Swan Jet
                 The safety record reflects upon the reputation of the organisation, so senior staff at
                  Swan Jet need to ensure the continuance of high safety standards and maintenance.
3. Customer Satisfaction & Loyalty




                                                                                                 Page 12
 Word of mouth referrals is the highest channel of how people hear about Sawn Jet, yet
      there are low numbers of repeat riders. Therefore Swan Jet need to build a customer
      loyalty based to increase Swan Jet awareness within the market.

OBJECTIVES & HIGHER LEVEL STRATEGIES

STRATEGIC GAP ANALYSIS




(Source: Compiled company data, designed by author)
As shown in the graph above, for this season the overall strategic objective is growth of the
business, through an increase in passenger numbers by 50%. Swan Jet has recently moved
locations which has seen a positive impact on its customer numbers and this percentage
increase compared to last year was used to establish the customer growth target.
ANSOFF’S PRODUCT-MARKET STRATEGIES
Using the Ansoff Product-Market-Matrix as showed in Exhibit 2, four potential strategies
were established that Swan Jet could implement by combining current and new markets with
current and new products16. Therefore, the objective is to define the possible courses of action
for Swan Jet to achieve growth, taking into account that the first three strategies can
simultaneously develop as a general company strategy, while diversification strategies need to
be evaluated further as it is a change from the company‟s core business17.

Exhibit 2 – Ansoff´s Product-Market-Matrix 16




Market Penetration Strategy
        Market penetration aims to increase sales and profit margins of current products in
their current markets18 by adding new customers, attracting competitor‟s customers and
growing product usage19. Swan Jet Adventures is available through direct sales and from
online distributors who take a 20-25% commission and will aim to implement an online


                                                                                       Page 13
payment system on their website to remove distributor commissions and increase profit
margins. Furthermore, Swan Jet should initiate online marketing promotions to expand
market share to attract new customers from competitors. Swan Jet could also establish kiosks
at major shopping centers selling gift vouchers and cards during Christmas and other major
holidays and implement loyalty programs to provide incentives for passengers to provide
referrals to friends and discounts for repeat customers to generate additional sales.
Market Development strategy
 Market development focuses on expanding into new markets based on the current product
and service with tactics such as geographical expansion, new segments development and new
distribution channels18. The strategy that Swan Jet could pursue is to explore new segments in
Perth and to offer the Jet boat service at different locations in WA at Hillary‟s Boat Harbor
and Mandurah. Swan Jet should expand its consumer base by crafting a marketing strategy to
target the corporate market through communication channels with Perth HR managers that
offer exclusive packages for corporate events. The segment of university student can be
potentially developed with a complement marketing strategy that includes special prices and
benefits, alliances with educational centers and advertising campaigns. Additionally, the
inclusion of a new distribution channel such as Swan Jet tickets being sold on the Rottnest
Express Ferry on the Swan River with their 150,000 annual passengers will allow for entrance
into new segment markets.

Product development strategy
         Swan Jet can generate new products for the current market in Perth to promote sales
growth18. Specific tactics such as product innovation and the addition of new characteristics to
the actual product support product development should be used17. Swan Jet has access to an
additional boat that could be used as a river taxi service for special occasions, or tourists
wanting a private boat trip. Swan Jet could also enter into a joint agreement with the bar and
restaurant “The lucky Shag”, offering Swan Jet customers a 10% discount on food and
beverages before or after the Swan Jet ride.

Diversification Strategy
         The offering of new products to new markets can be accomplished by utilizing three
different strategies: diversifying through related and unrelated products and vertically
integrating with suppliers or distribution channels1718. Swan Jet Adventures can implement
related diversification by offering jet boat certification, sailing lessons, and jet ski hire. Using
the owners‟ reputation, experience and network can increase the market size and through
vertical integration strategies, the company could utilize these elements to develop a “Hire a
Skipper” company. This is where large private boat owners and small charter companies can


                                                                                           Page 14
hire skippers with experience and offer maintenance services taking into account the expected
increase in the number of boats in Perth and the engineering expertise of the skipper.
SMART OBJECTIVES for Q2 2010- Q2 2011
Studies have shown that goals that are formulated using the acronym SMART- specific,
measureable, achievable, realistic and appropriate timeframe can increase the likelihood of
goals being achieved20. Given the above analyses, the following objectives focusing on
increasing company growth and brand equity are recommended to Swan Jet:

      Increase brand awareness by 30% throughout Western Australia with a higher
       concentration on the Perth metropolitan area
      Evaluate their target market segments and monitor specific strategies to grow each
      Focus more attention on short term marketing strategies to increase customer numbers to
       assist the company‟s financial growth and capital which will fulfil its long-term objective
                     Swan Jet Adventures SMART Goals : Quarter Two 2010 – Quarter One 2011
Quarter:            Goals
      Q2            MARKET PENETRATION
  (Nov - Dec              Increase customer numbers for December by 60%
    2010)                 Increase number of repeat passengers by 30% (special offers to past passengers)
                          Increase brand awareness of Swan Jet throughout the Perth Metropolitan area by 30%
                          Increase number of gift vouchers sold by 20%
                    MARKET DEVELOPMENT
                          Increase corporate bookings by 30%
                    PRODUCT DEVELOPMENT
                         Food agreement with “Lucky Shag” bar and restaurant – increase from Nov numbers by 20%


        Q3          MARKET PENETRATION
    (Jan - Mar           Increase customer numbers by 60% in Jan, Feb & March
       2011)             Increase number of repeat passengers by 20%
                         Increase brand awareness by 20%
                         Decrease by 30% of Redballon/Adrenalin bookings, with concurrent increase of 30% by own
                          online bookings
                    MARKET DEVELOPMENT
                         Increase corporate bookings by 20%
                         Increase student bookings by 20% (New uni semester)

                    PRODUCT DEVELOPMENT
                         Offer water taxi service

        Q4          MARKET PENETRATION:
    (Apr - June          Increase customer numbers by 50% in April, May & June
      2011)              Increase number of repeat customers by 20%
                         Increase brand awareness by 10%

                    MARKET DEVELOPMENT:
                         Increase corporate bookings by 20%

         Q1          MARKTET PENETRATION:
    (July - Sept             Increase customer numbers by 20% in July & September
       2011)                 Increase brand awareness by 20%
                     MARKET DEVELOPMENT:
                             Investigate possibilities of opening up Jet boat businesses in Mandurah and Hillary‟s Boat
                              Harbour – investment required, licensing requirements, and customer segments.
    Overall goal of increasing passenger numbers by 50%




                                                                                                                   Page 15
MARKETING MIX
The Marketing mix is the set of tools including short-term and long-term strategies to shape
the nature of the service offered to consumers21. Marketing communications are the ways by
which firms try to inform, persuade, incite and remind customers either directly or indirectly
about the brands they sell. It represents the voice of a brand and the methods by which
companies can engage in a conversation with consumers concerning their product offerings22.
Furthermore, the challenges presently faced by markets in the design, implementation and
evaluation of marketing communication programs are very different from the challenges faced
                                                   23
by marketers 20 to 30 years ago                         . Effectively designed and implemented marketing
communication programs are priceless for building organisation‟s brand awareness and equity
position.
POSITIONING & SEGMENTATION
Swan Jet operates in a small niche market with several competitors; however the company has
a number of points of difference compared to other companies offering adrenaline activities as
shown in table below.

                                                Swan Jet Adventures Present Generic Strategy
                                                                       Basis of competitive advantage:
  Competitive Scope:




                                                    Cost                                Differentiation
                       Broad Target Market          Lowest cost Leadership              Differentiation

                       Narrow Target Market         Focus – cost                        Focus – differentiation



                          (Source Hubbard, Rice & Beamish 2008, modified by author)


When developing the customer segments for Swan Jet, a survey was undertaken to identify
and analyse customers into segments24. Swan Jet has a broad customer based as discussed in
the customer section and as a result from the survey results; however four segments were
identified for targeted marketing mix strategies: Corporate Clients, International Visitors,
University Students and Young Professionals. Although focus is on these four customer
segments, it is recognised that the end user of the service is not always the buyer, thus the
buyer may not be in the targeted segments for Swan Jet, particularly as Swan Jet does sell
numerous gift vouchers25.West Coast Jet is the main direct competitors with the
differentiation between the two companies below.


West Coast Jet is the main direct competitor to Swan Jet Adventures as they also offer a jet
boat ride to customers. However there is still differentiation between the two companies as
outlined in the table below.


                                                                                                                  Page 16
Similarities and Differences between West Coast Jet & Swan Jet Adventures
Points of                  Both offer Jet boat rides
Parity:                    Both boats able to do fish tails, bucket stops and travel at high speeds
                           Both offer pictures
                           Both target “adrenalin experience” customers
                           Both weather dependant
Points of                  Swan Jet operates on the Swan River
Difference:                West Coast jet operates on Fremantle ocean
                           West Coast jet offers Whale watching tours
                           West Coast jet boat seats more passengers – however passengers do not sit as close to the water thus
                            different ride experience
                           Only Swan Jet can do 360 degree turns – passengers also feel closer to the water
                           Swan Jet gives commentary about the major landmarks of Perth as well as information about the Jet
                            engines
                           Swan Jet ride is 5 minutes longer, as well as $5 less expensive for children
                           Swan Jet has a permanent office
                           Swan Jet owner has unique relationship with other commercial boat companies operating out of
                            Barrack St Jetty (thus allowing boat position change)


      The table below illustrates the points of parity and difference between Swan Jet Adventures
      and its other competitors. Although South Perth Parasailing and Extreme Ski are targeting
      similar customer segments, the type of experiences the customers wants determines which
      company receives the customer numbers.
                 Similarities and Differences between Swan Jet Adventures (SJ)& Water based Competitors:
                      South Perth Parasailing (SPP)             Extreme Ski WA (ES)            Captain Cook & Golden Sun
                                                                                                     cruises (CC/GS)
Points of Parity: - Both offer Photos                    -Both water experience activities - Water activities
                   - Both operate on river               - Both weather dependant
                   - Both weather dependant
                   -Similar target audience
Points of          - SPP offer “sky” experience          - ES offers overnight experiences - CC/GS not „adrenaline‟
Difference:        - SJ river level experience           - ES has high physicality compare experience
                   - SJ ride is longer and less          to SJ‟s low physicality           - Targeting majority different
                   expensive                             - Different services              segments
                   - SJ larger range of target customers                                   -CC/GS offer half or full day trips
                                                                                           with food and beverages

      CUSTOMER SEGMENTS

      CORPORATIONS
      In the past Swan Jet has been approached by the Water Corporation and KFC to provide the
      Jet boat service for employees as a result of employee rewards and state or national company
      functions. It was identified by the owner that this segment had the potential for growth with
      past marketing strategies not effectively targeting this market. It has been

      Irvine (2009) identified that employee engagement is 24% higher in those employees that
      received non-cash incentives compared to financial incentives, thus this service fulfils the
      criteria of non-cash incentive / reward26. Also opportunities for Swan Jet to receive repeat
      business are present, as employees can inform family and friends, as well as interdepartmental
      recommendations.




                                                                                                                      Page 17
INTERNATIONAL VISITORS
This segment includes both domestic and international students, who are seeking adrenaline
activities to partake in. Customers aged between 20-25 scored equal highest in the age
demographics using Swan Jet. Thus potential to increase growth in this segment, with one
why to further increase promotions to this age category is via university clubs/ guilds.

UNIVERSITY STUDENTS
This segment includes both domestic and international students, who are seeking adrenaline
activities to partake in. Customers aged between 20-25 scored equal highest in the age
demographics using Swan Jet. Thus potential to increase growth in this segment, with one
why to further increase promotions to this age category is via university clubs/ guilds.

YOUNG PROFESSIONALS
This segment includes those customers who are working with suitable disposable income and
are looking for adrenaline activities. Customers aged 26-30 where one of the highest age
demographics using Swan Jet, thus Swan Jet should target these customers to increase their
usage.
BRAND EQUITY & AWARENESS
Brand Equity is the differential result of brand knowledge on consumer reaction to the
marketing of the brand and that effective communication enables the formations of brand
awareness and a positive brand image that is in line with their aspirational brand identity25.
Building brand equity requires the incorporation of brand characteristics into a company‟s
overall marketing programs such as „product, price, advertising, promotion and distribution
decisions‟27.Strategically oriented integrated brand communications can help organisations
gain a competitive advantage in the highly competitive world of the 21st century28 but
feedback from customers, prospects and publics regarding an organisation‟s brand awareness
and image will ultimately enable the brand owner to adjust its brand image identity29

According to Young & Rubicam‟s BAV brand equity model, Swan Jet‟s brand position in the
market is classified as „new‟ with high levels of differentiation and energy but having low
levels of relevance, esteem and knowledge30. Swan Jet‟s unique adrenaline jet boating service
and Swan River location differentiates itself from other boating companies. As a young
company with young staff and natural annual growth who are constantly looking to improve
the brand, Swan Jet demonstrates high momentum or high energy. Customers would say that
Swan Jet has middle esteem as demonstrated by high word of mouth referrals from past
customers. Swan Jet‟s relevance is currently low as it has not been accepted or known by
most people in Perth and WA as it is a relatively new brand and due to the limited capital and
marketing budget many consumers have no or limited knowledge of the brand.


                                                                                           Page 18
The reasons that Swan Jet has low brand awareness are due to the following:

        The company is only 4 years old and has yet had ample time to gain market share
        The company has no awareness of its target market segments and tracking of its
         customers leading to past ineffective marketing campaigns as a result
        The company has had a restricted amount of capital to allocate to promotional
         activities and diversified media communication channels to increase presence
        The company has mainly focused on the B2C market with limited activity in B2B
        The old office and jetty location on Barack Street had low visibility and foot traffic
STRATEGIES
Swan Jet has limited financial capabilities in implementing a number of strategies over a short
period of time and thus must utilise targeted multi-channel specific strategies to reach their
defined target markets in alignment with the seven P‟s of the marketing mix. As a result, we
would recommend a period of one year to implement the following marketing objectives
across all target market segments to increase brand awareness and improve the corporate
image:

   Increase 21st Century Marketing- Internet and Social Media (Appendix C)

   Promote Swan Jet on deal of the day websites

   Utilize Outdoor Advertising

   Launch of a new brand image and identity campaign

   Targeted event marketing to drive traffic

   Expansion of distribution channels

   Customer and website visitor tracking
SEVEN P’s OF SERVICE’S
Marketers endeavour to create, promote and deliver value for consumers and the use of the
seven P‟s of service, place, product, price, promotion, people, physical environment and
processes are used to help identify the appropriate mix of marketing strategies 21. Marketing
communication options or communication types can be judged according to the response and
communication impact that they ultimately create25.
PLACE
Marketers look at several factors such as distribution channels, coverage, locations, transport
and assortments to establish if any further value can be created, communicated and delivered
to customers21. Swan Jet should use a push strategy in deciding its distribution and marketing
channels to reach the end consumer.



                                                                                          Page 19
PRODUCT
The challenge within the service industry is that service innovation or differentiation can
often be imitated by competitors, thus no sustained competitive advantage31. Areas under
product that can be evaluated and reviewed for marketing mix include product variety,
quality, design, features, packaging and services21. In order to create a competitive advantage,
Swan Jet should offer a ticket bundling packages with merchandise as well as implement the
booking reservation system of BookD for $250 annually to initiate online bookings for
customers along with a PayPal business account to collect customer payments. Swan Jet
needs to promote and advertise the booking service on all social media platforms and media
communication materials.




The company can add advertising opportunities such as Google Ad Sense on its website for
organisations wishing to promote its products and to drive additional traffic

PROMOTION
Factors under promotion that can be examined for innovation and value for customers include
sales promotions, advertising, sales promotion, personal selling and public relations. The
promotion of services needs to place particular emphasis on increasing the tangibility of a
service and furthermore in the case of services marketing, production personnel are important
components of the promotion mix23. It is identified in the literature that Social network sites
are consumed mainly by young adults and teenagers and that information gathered from
members profiles can be used for targeted advertising32.




                                                                                       Page 20
PRICE
List price, discounts, allowances, payment timeframes and credit terms can be evaluated to
see if any innovation or further value creation is possible for consumers and contribute to
marketing mix21.

Swan Jet current price structure can be seen in table below, with increase due to new costs.
                                     New Price Structure for 2011
                                                    NEW:                   OLD:
Adults                                              $55                    $49
Children (14 years & under)                         $35                    $30
Families (2 Adults & 2 Children)                    $145                   N/A


Swan Jet can incorporate pricing strategy called pricing discrimination which is when a
company sells a product or service at two or more prices that do not reflect a proportional

                                                                                       Page 21
difference in cost33. The three degrees of price differentiation are: depending on customers
demand sellers charge a different price34, those who purchase larger volumes are offered
discounts 31 and sellers charging variable prices to different customer segments31.
Price discrimination is applicable to Swan Jet only in the second and third degree. The
findings of Morris suggest the use of price discrimination through volume based purchase is
the most effective way especially in industrial marketing (B-to-B marketing)35. The table
below represents current corporate/group price package (second degree price discrimination)
along with tier pricing recommendations.
                 Corporate/Group Price Package (Current)                            Recommended
No. of people                     Price              Discount       No. of people   Price         Discount
12+                               $45                18%            5+              $50           10%
24+                               $39                29.1%          10+             $45           18%
                                                                    20+             $39           29.1%


In third degree of price discrimination there are several strategies: customer-segment,
product-form, image, channel, location, and time/season pricing21. For Swan Jet, customer-
segment and time/season pricing would be the most beneficial strategy.
Customer-segment pricing is a strategy that uses different customer groups to pay a different
price for the same product or service and time/season is a strategy that varies „by season, day
or hour‟ 35. The table below represents current third degree price discrimination for Swan Jet
along with some recommendations for Swan Jet to implement.
                Customer Segment Pricing (Current)                 Customer Segment Pricing (Recommended)
                                Price              Discount                         Price         Discount
Children                        $35                36%          Children            $35           36%
                                                                Student             $50           10%
                  Time/Season Pricing (Current)                        Time/Season Pricing (Recommended)
                                                                Morning             $50           10%
                              NONE                              Winter


Winter season is the least profitable season for Swan Jet. We therefore recommend
introducing „Black to School Week‟ promotion during winter to increase customer volume. In
the morning, Swan Jet is also not attracting too much customers as they would have liked.
Hence, we recommend during low traffic period to noon where traffic is more substantial,
Swan Jet should discount their price to $50 to increase volume.

PEOPLE
In the service industry often customers perceive the employees as the service and that to add
value in the mind of the consumer it is through personalization and active participation of
employees that creates value36. Thus appearance, attitude and manner of employees can
impact on the customers‟ perception of the quality of service that Swan Jet offers. As the
service that Swan Jet offers to customers is an experience, the way customers perceive the


                                                                                                    Page 22
Swan Jet staff can impact on their sense of value for money as well as overall enjoyment. It is
recommended that Swan Jet implements staff training that includes sales training, customer
service with emphasis on staff attitudes and energy levels when dealing with customers and
how staff should assess the quality of service they have given37. Office staff should also be
given an authorised allocated amount of budget, for them to utilise during a customer critical
incident.

PROCESS
Process involves the systems utilised by employees to deliver the service to customers and
often increases in effectiveness can occur as a result of reviewing and implementing changes
to the process management systems16. A standardised customer relationship management
system (CRM) for in store and online sales should be implemented to ensure that Swan Jet
has easy access to rich customer data that can be utilised for future promotions. It is
recommended that the wavier form is modified to gather relevant customer demographics in
order to monitor KPI‟s as well as changes in target market segments. Standardise the type of
information that is given to customers by the jet boat skippers, however allowing for the
skippers to deliver the information in their own unique style.

PHYSICAL EVIDENCE
The environment setting can influence the reality of the service in the mind of the customer,
thus environment and physical evidence aspect can impact the perceived value and experience
the customer has 22. Swan Jet‟s servicescape needs to emit a professional yet adventurous and
exciting vibe at the office which is the first point of customer contact, as well as at the
customer preparation area and in the jet boat itself. It is recommended that all jackets that
customers wear for the ride have the Swan Jet logo in large print on the back of the jackets, to
help with Swan Jet brand recognition by passing traffic going by the preparation area. Swan
Jet already uses monitors to display customer photos but they should develop a Swan Jet
video which shows the Jet boat in action, as well as customer testimonials to promote the
experience. Displaying merchandise in the office window and having a standardised uniform
policy will help build brand recognition and increase the corporate image. The literature
identifies that for a service that people are unfamiliar with, the presence of a long single line
can actually maximise consumer perceived value of the service or product being offered 38.
Thus as Swan Jet currently has low brand awareness, Swan Jet has two opportunities to utilise
queue infrastructure, when clients are checking in and wait to suit up for the ride. It is
suggested to redesign the company´s web pages to make it easier to search information, less
visually confronting and to include a register link to capture potential customers´ information.
This is due to research which indicates customers respond more positively to low feature


                                                                                        Page 23
complexity of colour and detail39. Other re-branding activities include logo adjustment and
addition of company slogan “cool your thirst for excitement”. Also there are two different
internet domains that are communicated to customers, so it is vital that that these are merged.

BUDGET
The current marketing budget of Swan Jet Adventure is $72000 constituting 25.71% of
revenue (YR08-YR09). In order to break even, according to the owner of Swan Jet
Adventures, 4000 customers is needed. In the last few months, Swan Jet has purchased a new
location that would attract more foot traffic. With more traffic and marketing strategy, Swan
Jet Adventure is expecting an increase of 40% in its sales revenue. Expenses are expected to
increase by a substantial amount because of purchase of new jetty, more fuel consumption
and hiring a sales person. The forecasted revenue and cost can be seen in the table below.

                                  YR 08- 09          Current              Cost Structure
Sales Revenue                          $280,003                $392,004   Insurance                   $20,000
Cost w/o marketing expense             $178,249                $273,656   Jetty Purchase              $44,000
                                                                          Jetty Rent                  $20,000
Activities                        Before             Current              Staff                       $78,000
Tourist Magazines                           $2,640               $3,000   Workers Comp                 $4,000
Experience Perth                             $900                $1,200   Phone Bill                   $7,200
West Australian                            $11,400                   $0   Office                       $4,800
Brochures                                   $6,000               $6,500   Boat Maintenance             $6,000
Posters                                                          $2,000   Loan                        $30,000
Newsletters, Direct Mail                                         $4,000   Fuel (Estimated)            $22,656
Yellow pages                                $8,660                   $0   Staff Training               $5,000
Internet marketing                                               $8,500   Uniforms                     $2,000
Online booking                                                    $300    Extra Sales Person          $30,000
Web site and Logo                                                $1,000   Total Cost                 $273,656
Aerial Advertising                             $0                $4,000
Sponsorship (include charities)                                  $6,000   Fuel calculations
Promotional Products                                             $2,500   Total Rides required           755.2
Radio                                      $42,400               $5,000   30 Liters Per Ride            22656
Video Production                                                 $2,500   $1 a liter                  $22,656
Retail Outlets                                                   $6,300
Reserve                                                          $2,300
Total cost strategies                   $72,000                 $55,100
Total Cost                             $250,249                $328,756
Net profit                              $29,754                 $63,248
We have also recommended reducing our marketing budget by $16900 because of the
following reasons. First, Swan Jet can reduce its marketing budget for radio as they were only
getting a response rate of 3.7%. Second, Swan Jet can eliminate Yellow Pages listings off-line
and online (0.2 % response rate) and continue utilizing the free listings on Google Places.
Third, Swan Jet can use the proceeds from reduced marketing expense to partially fund their
purchase of new jetty. Finally, we are allocating funds to a more targeted market thereby
increasing response rates of marketing campaigns.
Return on Investment has been calculated to be 13.02%. This is more than achievable because
they are currently experiencing higher foot traffic and customers since the purchase of the



                                                                                           Page 24
new location. Cost includes the purchase of new location and marketing budget. This is
because the purchase of new location and marketing expense is the main strategy that
increases sales revenue by 40%. The combined cost of the two is $55,100+$44,000 =
$99,100. The 40% increase in sales revenue accounts to $112,001.




IMPLEMENTATION, EVALUATION & CONTROL

ACTION PLAN
Quarter two and three are the peak operating months for Swan Jet, consequently several of the
marketing mix strategies will need to be implemented almost immediately to ensure that they
have the maximum exposure to consumers. However once implemented a lot of these
strategies can continue through the quarters as well as future years, with the majority of
promotion occurring in quarters two and three.

                               Swan Jet Adventures Implementation Plan
                                  Quarter Two 2010 – Quarter Two 2011
Quarter:     Marketing Mix Strategies: (Responsibility D=Director, OM=Office Manager)
   Q2        GENERIC:                                         PROMOTION:
(Nov – Dec      SEO & PPC (Dec - D)                              Direct mailing to corporate social
  2010)         Brand Ambassadors in shopping centres (Dec–       clubs (Nov/Dec- OM)
                 OM)                                              Target corporate HR managers
                Charities (Dec - D)                               (Nov/Dec- OM)
                Social media = Facebook/Twitter (Dec – OM)
                Target Facebook adverts (Dec- OM)
                Loyalty customer discounts
                Re-branding and development of company
                 logo, website & slogan (Dec-D)
             PLACE:                                           PEOPLE:
                Corporate HR distribution (Nov / Dec - OM)       Sales Training (Nov/Dec-D)
                Onboard Rottnest Ferries (Dec – D)              Customer Service Training (Nov/Dec-D)
             PROCESS:                                         PRODUCT:
                Wavier Modified (Nov - OM)                       Partnership with Lucky Shag bar
                                                                   (Dec - D)
             PHYSICAL EVIDENCE:                               PRICE:
                Uniform Policy (Dec – OM)                        Tier corporate $‟s (Nov/Dec- OM)

    Q3       GENERIC:                                                PROMOTION:
(Jan - Mar      Ticket bundling (Jan-OM)                               Photo gallery SJ Facebook (Jan-OM)
   2011)        Commence monthly Email Newsletter (Jan-                Listings on trip advisor (Jan-D)
                 OM)                                                    PR in paper & magazines (Feb-D)
                Outsource PR (Jan-D)                                   Posters in Bars & restaurants (Jan-D)

             PLACE:                                                  PHYSICAL EVIDENCE:
                Distribution at Hillary‟s / Rottnest Island (Jan-      YouTube Swan Jet video (Jan-D)
                 D)
                Sightseeing Bus tours distribution (Feb-D)          PROCESS:
                Student flight centres (Feb-D)                         Online booking System (Feb-D)
                Tourist information centres (Jan-OM)
                Uni guild and market stores (Feb/Mar-OM)


                                                                                                      Page 25
Q4          GENERIC:                                              PROMOTION:
  (Apr -          Continuance monthly email newsletter (OM)            Corporate employee discount
June 2011)                                                               programs (Apr – D)
                                                                        Target Facebook advertising (Apr –
                                                                         D)

    Q1         PLACE:                                               PROMOTION:
  (July -         Distribution Fremantle (Sept - D)                   Advertisements WA Business news
Sept 2011)                                                              (Aug / Sept - OM)
               PEOPLE:                                                 Target HR managers (Aug –OM)
                  Sales & Customer service training (Sept-D)

KEY PERFORMANCE INDICATORS (KPI)

It is necessary for Swan Jet to implement strict record keeping in order to tract how successful
and effective marketing strategies are and how they have impacted on customer numbers.
The KPI information can be recorded directly (customer) and indirectly (booking agents) and
be analysed monthly.
   Increase brand awareness by 30%.
    - How customers heard about Swan Jet.
   Evaluate their target market segments and monitor specific strategies to grow each.
    -      Record which discount offer / promotion did they used.
    -      Have they ridden with Swan Jet previously?
    -      Where did they buy tickets from & did they buy a ticket bundle?
    -      Record customer demographics.
   Increase customer numbers.
    -      Use table below to monitor if company is on track to reach overall 50% increase in
           customer numbers.
                                        Target Customer Numbers Q2 – Q2
Quarter:                         Past Numbers: 09/10     Target Numbers: 09/10
Q2                           1596                        2358
Q3                           2241                        3585
Q4                           826                         1239
Q1                           306                         370
TOTAL:                       5000                        7552
To evaluate people and process marketing initiatives, Swan Jet should on one day every week
offer passengers a free photo if they complete a survey asking for customer feedback on their
experience with Swan Jet. This information should be analysed monthly by the Director.

RECOMMENDATIONS & CONCLUSION
The 2011 Marketing Plan designed for Swan Jet Adventure was developed taking into
account that the company has been present in the market since only 2007, with no actual
planned marketing strategy and with a limited budget according to its market size. The plan


                                                                                                   Page 26
introduces new strategies that mainly focus on achieving the brand awareness, sales and
growth from a generic focus as well as specific strategies to target corporations, university
students, young professionals and international visitors.

Our recommendations focus on implementing targeted short-term strategies from November
to March 2010-2011 to meet company objectives, through a multi-channel communication
mix focusing on place, promotions and service marketing activities such as:
   Implement customer service training to increase customer service satisfaction, which can
    increase word of mouth referrals and customer loyalty
   Internet SEO and PPC Google Ad Words and sweepstakes campaigns to drive traffic
   Implement and regularly use social media marketing platforms effectively such as tagging
    photos and videos of all customers to increase awareness through news feeds and updates
   Complete re-branding effort of the website and logo including a new booking system,
    social media integration and company slogan “cool your thirst for excitement”
   Measure and evaluate the results and effectiveness of the marketing strategy plan on a
    monthly and quarterly basis through the use of KPI‟s
   Track all customers in a CRM database and receive feedback from customer experience
    questionnaires
   Increase distribution channels through retail outlets and higher traffic internet retailers

The seven P‟s of Service Marketing-Mix was used to identify the specific strategies to deliver
value to the customer. Short term strategies were established with the aim of fulfilling the
marketing objectives of the company. Pricing discrimination strategy was used to enhance
the number of passengers through group special value packages, and special discount for
students taking into account the growth potential of the segment. It is expected that for 2011
Swan Jet would achieve the overall objective of increasing by 50% its number of passenger as
a result of the new location in conjunction with the implementation of marketing plan. As a
second step, it is recommended to Swan Jet to implement additional marketing strategies
focused on diversification and new product development as a way to increase profitability.




                                                                                           Page 27
APPENDIX
           7
Appendix A – Recreational boats versus Population in Perth




Appendix B 14 – WA Population 2006 versus 2025




Appendix C- Social Media Stats of Australia




                                                             Page 28
Appendix D–Internet Gift Retailer Process




(Source: Data compiled by Redballon.com.au and modified by author)




                                                                     Page 29
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Strategic Marketing Plan for Swan Jet Adventures

  • 1. P lan MARKETING PLAN SWAN JET ADVENTURES PREPARED BY: PATRICK GALLAGHER SION KARTA ANNA MULHOLLAND MARIA PAULA VASQUEZ Page 1
  • 2. EXECUTIVE SUMMARY Swan Jet Adventures, a Perth-based commercial boating company, offers an adrenaline jet boat ride service that has been running operations on Barack Street jetty since 2007. In the past year, their profit has expanded from $10,595 (3.91% margin) to $29,754 (10.63%), but there still is a major lack of brand awareness. Swan Jet currently has a position in the niche customer market of „adrenaline activities‟, with Swan Jet striving to develop further its focus differential position in the market. External Environmental & Critical Success Factors: Macro and Micro environmental research indicates that Swan Jet is operating within an environment that would support the growth of Swan Jet. Factors in the external environment that Swan Jet need to monitor include, West Coast Jet highly discounted prices, relationship with Swan River Trust and commercial boating regulations and restrictions. There are three critical success factors that Swan Jet‟s director needs to monitor closely. These factors are: 1) The ability of Swan Jet to maintain and increase its customer numbers 2) Ensure the continued quality and safety record of Swan Jet 3) Improve the level of customer satisfaction and customer loyalty amongst Swan Jet customers. Objectives: The overall objective for Swan Jet is growth of the business, mainly through the increase of customer numbers by 50%. Marketing objectives include  Increase brand awareness by 30%  Evaluate their target market segments and monitor specific strategies to grow each  Focus more attention on short term marketing strategies to increase customer numbers to assist the company‟s financial growth and capital which will fulfil its long-term objective Strategies:  SEO & PPC targeted internet marketing  Increase distribution channels  Social Media marketing Page 2
  • 3. TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................................................................................................ 2 SITUATION ANALYSIS .............................................................................................................................................. 4 MACROEVIRONMENTAL ANALYSIS ......................................................................................................................... 4 MICROENVIRONMENTAL ANALYSIS ........................................................................................................................ 7 INDUSTRY-MARKET REVIEW ............................................................................................................................... 7 CUSTOMER REVIEW ............................................................................................................................................ 8 COMPETITOR REVIEW ......................................................................................................................................... 8 DISTRIBUTOR REVIEW ......................................................................................................................................... 9 SUPPLIER REVIEW ............................................................................................................................................. 10 SWOT ANALYSIS .................................................................................................................................................... 11 MARKETING OPPORTUNITY ANALYSIS .................................................................................................................. 11 CRITICAL SUCCESS FACTORS ................................................................................................................................. 12 OBJECTIVES & HIGHER LEVEL STRATEGIES ............................................................................................................ 13 STRATEGIC GAP ANALYSIS ................................................................................................................................. 13 ANSOFF’S PRODUCT-MARKET STRATEGIES ....................................................................................................... 13 SMART OBJECTIVES for Q2 2010- Q2 2011 ....................................................................................................... 15 MARKETING MIX ................................................................................................................................................... 16 POSITIONING & SEGMENTATION ...................................................................................................................... 16 CUSTOMER SEGMENTS ..................................................................................................................................... 17 SEVEN P’s OF SERVICE’S .................................................................................................................................... 19 BUDGET ................................................................................................................................................................. 24 IMPLEMENTATION, EVALUATION & CONTROL ..................................................................................................... 25 ACTION PLAN .................................................................................................................................................... 25 KEY PERFORMANCE INDICATORS (KPI) ............................................................................................................. 26 RECOMMENDATIONS & CONCLUSION ................................................................................................................. 26 APPENDIX .............................................................................................................................................................. 28 REFERENCES .......................................................................................................................................................... 30 Page 3
  • 4. SITUATION ANALYSIS BUSINESS DEFINITION Swan Jet Adventures (Cruise WA PTY LTD) operating since 2007 from Barrack Street Jetty on Perth´s Swan River is a small business operation, with large market potential that currently entertains approximately 5,500 people every year. The company has six employees, including jet boat skippers, an engineer, and part-time customer service personnel. The main service offered by Swan Jet is a 25 minute jet boat ride experience for up to 14 passengers on the Swan River, whom experience the thrills and excitement of an adrenaline jet boat which reaches speeds up to 80km/h and does continuous 360 degrees spins to keep hearts racing. Swan Jet offers gift vouchers and merchandise products for purchase, while diversifying its services to include experience packages of parasailing, helicopter rides, and Harley Davidson tours to promote the whole Swan Jet experience. MISSION STATEMENT The Swan Jet mission statement is “To deliver an exhilarating fast and fun jet boat adventure while demonstrating our duty of care to our customers, other river users and the unique environment of the Swan River”. MACROEVIRONMENTAL ANALYSIS DEMOGRAPHIC POPULATION GROWTH & AGE AND SEX DISTRIBUTION To date, the Australian population in March of 2010 reached 22.2 million, with the population in WA reaching 2,286,100 along with a growth rate of 2.3% representing the highest increase in Australia1. The majority of states had a positive increase as a result of migration and natural population growth, with WA in which Swan Jet operates experiencing the strongest population growth2. In WA the median age is 36.2 years with WA and Queensland both having the highest growth of 13.8% in the 15-64 age categories. From June 2009 there were 11.02 million females in Australia, compared to 10.93 million males, with WA and Northern Territory consisting of more males than females1. EDUCATION TRENDS In 2008, there were 3.4 million students in Australia, with 17% of students involved in higher education and the number of Australian‟s with vocation or higher education qualifications has been increasing over the past 10 years from 43% to 69% of the total population aged between 25-62 years3. This increase can be linked to the growing significance of educational qualifications to support employment2 and WA also showed an increase in higher education overseas students, moving from 14.9% in 1998 to 32% in 20083. Page 4
  • 5. AGE PYRAMID 4 (Source: Compiled from Year book Australia 2009-2010 modified by author) SOCIOCULTURAL Family, community life and sporting activities are important elements of the Australia society with the later representing and population increase from 55% in 2000 to 65% in 2006. The principal reasons for exercising were heath and leisure, followed by social and family wellbeing. The proportion of adults attending sport events was 44% on 2006, which remained stable from 2005 4. ECONOMIC Swan Jet customers consist of 75% local West Australians and as a leisure activity, the condition of the state and country economies can impact the levels of business and disposable income. Graph A represents how the Global financial crisis (GFC) at the end of 2007 affected the Australian GDP growth rate and illustrates the steady decline during 2008 as a result of the GFC. However as demonstrated in Graph A, Australia is slowly gaining momentum in GDP growth rate and is experiencing approximately 3.2% GDP growth rate in Q3 2010. GRAPH A Source: Trading Economics 2010 WA has been a relatively strong economy and from 2006 onwards, WA‟s Gross State Product (GSP) has been above the GDP growth rate for Australia. Aside from a drop in WA‟s GSP in 2009 compared to Australia‟s GDP, since March 2010 WA‟s GSP has been 5% while regaining its momentum, and showing a stronger performance than Australia‟s GDP of 2.7% growth in March 20105. Page 5
  • 6. GRAPH B Source: Access Economics Cited by Westpac, Q2 20106 ENVIRONMENT Since 1989 the Swan River Trust has been the regulation authority in charge of the protection and management of the Swan River and the surrounding lands7. The principal environmental concerns as a result of increases in boating activities are the hydrocarbon contamination and general water contamination by pollutants, metals and oils8. The Swan River Trust is vital to Swan Jet‟s business as they control the awarding of commercial boating licence, restrictions and boat maintenance practices on the Swan River9, POLITICAL-LEGAL As a result of the federal election in August 2010, Australia now has a Labor government and a Liberal State government. The main legal and political influences affecting Swan Jet are listed below.  The Australian Competition and Consumer Commission10 was formed in 1996 to administer the trade practices Act 1974 and other acts to promote competition and fair trade in the marketplace to benefit consumers, business and the community.  The Labour Government 11 plans to introduce a tax relief of instant write offs for small business assets worth up to $5000, meaning many small business investments can be written off in the year of purchase. Swan Jet will be eligible for the tax relief plan resulting in additional cash flow for business operations and marketing.  The Swan and Canning Rivers Management Act 200612 came into effect to improve the processes for assessing development proposals and decisions on Swan River activities. The form 6 license13 is required for all activities proposed in the River Reserve, such as a commercial charter vessel and ferry operations for financial gain or reward through the Swan River Trust. Swan Jet Adventures received their license before any renewal regulations were brought in, so their license is a 30-year exclusive license agreement. Page 6
  • 7. TECHNOLOGY Swan Jet can benefit from technological advancements in Jet engine fuel efficiencies and distribution technology. In four years time when Swan Jet‟s jet engines need replacing Swan Jet should consider jet boat engines that provide greater fuel efficiencies and horse power which will contribute to enhanced customer experience as it provides more thrill and reductions in fuel costs. Distribution platforms such as mobile and internet bookings are something the company can look into. However, the company might experience technology lag due to restricted capital and may wait to hold off on new technology until price decreases MICROENVIRONMENTAL ANALYSIS INDUSTRY-MARKET REVIEW Swan Jet Adventures operates within the recreation boating industry in Perth in which the city is experiencing a growing population due to a stable economy and the healthy coastal environment. The Swan and Canning Rivers are at the centre of the boating industry due to its facilities with year-round water activities and the numbers of boats ownerships in Perth have been increasing in a rate faster than the growth of population (Appendix A)7. Furthermore, the increase in the numbers of recreational boats are a result of the growth in the population along with the raise in the popularity of boating activities with the retired population which is expected to double by 2025 (Appendix B)14. The forecast from 2007 to 2025 predicts that the population in Perth will grow to a rate of 30%, while the number of recreational boats is expected to increase 82% in the same period of time (Exhibit A)7. Perth needs to increase its boating facilities to handle the expected addition of 4,600 boats moorings and 34 boat ramps in Perth7. EXHIBIT A 7– FORECAST RECREATIONAL BOATS TO 2025 (Source: Department of Planning and Infrastructure of WA 2008) The tourism industry in Perth plays a key role in facilitating tourism and business activities to Western Australia. In 2009, WA represented 10.6% of the total international visitors‟ expenditure in Australia, and 5% of interstate visitors‟ expenditures with 695,000 international visitors (13% increase since September 2004), 895,000 interstate visitors (14% decline) and 4.4 million intrastate visitors. According to the Tourism Forecast Committee, Perth expects an increase of 4.3% international visitors and a decline of 0.2% domestic visitors while the WA regions expect a 6.6% increase of international visitors and a decline of Page 7
  • 8. 1.8% domestic visitors over 10 years14. The increases in the popularity of the recreational boat activities and tourism represent an opportunity for Swan Jet Adventures from the potential increase of the target market. CUSTOMER REVIEW The target market for Swan Jet services are males and females between the ages of 21-40 years that enjoy activities involving outdoors, water activities, thrills and adrenaline such as young professionals and university students. Additionally, Swan Jet has also had some corporate customers who booked the Jet boat for company events and sales promotions rewards. Initially the Swan Jet believed that international visitors were their main customer segment however this is not the current case as up to 72% of customers are local Western Australians. A survey of a small sample size of 50 Swan Jet customers was undertaken, to determine the accuracy of the target markets. Graph A below show support for the target demographics of Swan Jet customers but were limited due to the sample size and that the peak season was just beginning. GRAPH A (Source: Compiled from survery data, modified by author) COMPETITOR REVIEW Swan Jet Adventures is the only company operating commercial jet boating on the Swan River, however due to the adrenaline nature of the experience; it has both direct (water based) and indirect competitors. Direct competitors are those that offer water based and adrenaline experiences in the CBD and surrounding tourist areas, with indirect competitors including non-water based activities such as laser games and go-karting. For the scope of this marketing plan, Swan Jet Adventures has requested that focus be on direct competitors. The Perth area initially had three companies offering jet boat services to customers; however in 2009 the third competitor in Hillary‟s Boat Harbour closed its operations. West Coast Jet in Fremantle is Swan Jet‟s main competitor. Although both companies offer jet boat rides, the experiences are quite different due to the tour locations in the Indian Ocean and Swan River. Page 8
  • 9. The sustained competitor advantage for Swan Jet is the owner‟s relationship with suppliers and several distributors due to their exemplary reputation in the Perth commercial boating industry. As all of Swan Jet‟s competitors are private companies no data was available on the market share of each competitor. Please see the table below for a list of Swan Jet Adventures competitors. Main Competitors: Name: Strengths: Weakness: Target Customer: WATER BASED ACTIVITIES: West Coast  Can seat 20 passengers – larger boat  Unable to do 360 degree turns.  Adrenaline experience Jet -  Offers Whale Watching and Jet Boat  Lower Barrier to Entry (operating licence) customers Fremantle tours  20 minute trip compared to Swan Jet‟s 25 minute  Corporate customers  Operates on the Indian Ocean  Children $5 more expensive than Swan Jet.  Male & Female 20-40  Offers family price package  Two tours completely separate (no high speed turns yrs  Offers photographs and gift vouchers on Whale watching trip).  Low physicality  Fremantle is a popular tourist and local  Unable to book online. destination South Perth  Sole Parasailing operator in Perth on the  Weather dependant  Experience customers Parasailing river  Unable to receive photos on the day  Male & Female 20-50 – South  Offers two types of rides “High & Dry”  High price $80 for 10 minute ride years Perth or “Wet-n-wild”  Depending on rider numbers, rider‟s group may have  Custom built parasailing boat to wait on foreshore (thus solo experience)  Offers single and tandem rides Extreme Ski  Offers several services, Water tubing /  Weather dependant  20 – 40 years WA – South skiing / wakeboarding  High physicality experience customers Perth  Max 2 day trips (overnight  Groups - parties accommodation)  Quality equipment and instructors Captain  Offer variety of wine, scenic, lunch,  Large overheads (seven boats)  30 + year age groups Cook dinner and special event tours along the  High jetty fees  Interstate and Cruises – Swan River and Indian Ocean.  Aging boat fleet International Barrack St  More expensive than Golden Sun sightseeing tourist Jetty Golden Sun  More personal tours than Captain Cook  Limited passenger numbers (smaller boats than  Interstate and Cruises – cruises Captain Cook Cruises) International tourist Barrack St  Entertainment commentary  Less tour variety  30+ year Jetty DISTRIBUTOR REVIEW Swan Jet Adventures distributes its product of service through three different distribution channels of booking agents, direct distributors and internet retailers encompassing zero and one-level marketing channels. Distribution Channel Process In the zero-level, Swan Jet distributes its services directly to the consumer through an on-site ticket counter at its Barack Street Jetty office as well as through phone and e-mail bookings. In the one-level channel, Swan Jet distributes its service through a booking agent and multiple internet retailers (Table A and Appendix D) showing that Swan Jet is in the process of Page 9
  • 10. shifting its distribution channel towards an online model which reduces costs and allows for higher inventory levels to intermediaries with an extensive network of customers. West Coast Jet is applying downward pressure on prices by offering a 2 for 1 discount, which is reducing profit margins for the Swan Jet and the boating industry but Swan Jet has moved to a higher- traffic location with great visibility which should impact its distribution channels. Table A: Swan Jet Distributors and Channels Distributor Type of Distribution Channel Description Adrenaline Internet Experience Gift Retailer  Australia's largest adventure company, with over 2,000 exciting experiences & gifts to choose from throughout Australasia. FreemanX Internet Experience Gift Retailer  Australia‟s leading experience company that offers the fastest, highest, most daring, most romantic and most life changing experiences available Netbookings Internet Experience Gift Retailer  Luxury accommodation, day spas and experiences within Australia Redballoon Internet Experience Gift Retailer  Australia‟s leading internet gift retailer offering gifts and experiences.  Individual and Corporate Customers Swan Jet Direct Distributor  On-site ticket counter  Phone and e-mail sales Scenic Tours Booking Agent  Leading experts in luxury travel throughout Australia that provides a truly authentic experience that discovers all the famous 'must-see' sites and natural attractions. GoDo Australia Internet Experience Retailer  Leading online booking service for activities who works with hundreds of activity suppliers across Australia so people can book instantly BigThanks Internet Gift Retailer  Internet gift retailer for any person for any occasion that offers the most interesting, fun, unusual and unique gifts from around Australia. SUPPLIER REVIEW Swan Jet‟s supplier channel includes a mixture of seven different companies that impact Swan Jet‟s business (Graph A). In terms of the marketing plan Baileys Marine Fuels and Totally Work Wear are the two main suppliers that impact Swan Jet‟s business whereas Harley Tours, Heliwest and South Perth Parasailing are exclusive strategic partnerships. GRAPH A SWAN JET SUPPLIER CYCLE (Source: Compiled by author) Page 10
  • 11. SWOT ANALYSIS (Source: Valentin15 2001, modified by author) MARKETING OPPORTUNITY ANALYSIS Opportunity Matrix for Swan Jet Adventures: Success Probability: Attractiveness: HIGH LOW HIGH - Opportunity Two - Opportunity Three - Opportunity Five [Monitor] -Opportunity Seven [Monitor] LOW The only marketing opportunities mentioned in the opportunity matrix are those that Swan Jet has the capabilities and resources to implement, can be communicated and beneficial to the target market and be implemented better than any competitors 30. 1. Opportunity Two: 72% of customers are local with a 30% customer referral, but low repeat business, so this opportunity could increase repeat customers and sales numbers. 2. Opportunity Five: An efficient targeted marketing approach would be beneficial as currently Swan Jet has no clear structure to marketing strategies or budget allocation. 3. Opportunity Seven: This opportunity would decrease customer processing time before rides, as well as decreasing the level of lost revenue from customer no shows. Page 11
  • 12. 4. Opportunity Three: New distribution channels in areas of high local and international consumer traffic such as Hillary‟s Boat Harbour, Rottnest Island and Fremantle, would help increase consumer awareness of Swan Jet as well as increase sales. Threat Matrix for Swan Jet Adventures: Probability of Occurrence: Seriousness: HIGH LOW HIGH -Threat One [Monitor] - Threat Two -Threat Five - Threat Three -Threat Six [Monitor] LOW - Threat Four 1. Threat One: This threat is currently occurring as West Coast Jet who is Swan Jet‟s direct competitor is currently offering 50% discounts on all rides. 2. Threat Five: Both the cost of fuel as well as location rent have a high probability of increasing due to a strong Western Australian economy, impacting on profit margins. 3. Threat Seven: Swan Jet Adventures meets all the required safety regulations as well as employing highly trained and experienced skippers, however mechanical and equipment failures are always a threat. 4. Threat Two & Three: A major strength for Swan Jet Adventures is the unique licence it possesses from the Swan River trust for 20 years. High licensing entry barriers decrease the probability of new competitors. 5. Threat Six: As barrack street jetty is a commercial jetty for other large boating companies and a main source of water transport up and down the river, the seriousness is low due to larger companies high stakeholder influence. 6. Threat Seven: Swan Jet already experiences speed restrictions in the area where further development would occur, thus its impact on the ride would be minimal. CRITICAL SUCCESS FACTORS 1. The ability of Swan Jet Adventures to maintain and increase customer numbers.  A change in Swan Jet operations location, potential increases in fuel prices and main competitor offering highly discounted pricing, Swan Jet needs to increase their customer numbers to cover its expenses. If the competitor pricing threat remains long- term then Swan Jet risks losing interested customers and incurring cash flow issues. 2. Ensure the high safety record of Swan Jet  The safety record reflects upon the reputation of the organisation, so senior staff at Swan Jet need to ensure the continuance of high safety standards and maintenance. 3. Customer Satisfaction & Loyalty Page 12
  • 13.  Word of mouth referrals is the highest channel of how people hear about Sawn Jet, yet there are low numbers of repeat riders. Therefore Swan Jet need to build a customer loyalty based to increase Swan Jet awareness within the market. OBJECTIVES & HIGHER LEVEL STRATEGIES STRATEGIC GAP ANALYSIS (Source: Compiled company data, designed by author) As shown in the graph above, for this season the overall strategic objective is growth of the business, through an increase in passenger numbers by 50%. Swan Jet has recently moved locations which has seen a positive impact on its customer numbers and this percentage increase compared to last year was used to establish the customer growth target. ANSOFF’S PRODUCT-MARKET STRATEGIES Using the Ansoff Product-Market-Matrix as showed in Exhibit 2, four potential strategies were established that Swan Jet could implement by combining current and new markets with current and new products16. Therefore, the objective is to define the possible courses of action for Swan Jet to achieve growth, taking into account that the first three strategies can simultaneously develop as a general company strategy, while diversification strategies need to be evaluated further as it is a change from the company‟s core business17. Exhibit 2 – Ansoff´s Product-Market-Matrix 16 Market Penetration Strategy Market penetration aims to increase sales and profit margins of current products in their current markets18 by adding new customers, attracting competitor‟s customers and growing product usage19. Swan Jet Adventures is available through direct sales and from online distributors who take a 20-25% commission and will aim to implement an online Page 13
  • 14. payment system on their website to remove distributor commissions and increase profit margins. Furthermore, Swan Jet should initiate online marketing promotions to expand market share to attract new customers from competitors. Swan Jet could also establish kiosks at major shopping centers selling gift vouchers and cards during Christmas and other major holidays and implement loyalty programs to provide incentives for passengers to provide referrals to friends and discounts for repeat customers to generate additional sales. Market Development strategy Market development focuses on expanding into new markets based on the current product and service with tactics such as geographical expansion, new segments development and new distribution channels18. The strategy that Swan Jet could pursue is to explore new segments in Perth and to offer the Jet boat service at different locations in WA at Hillary‟s Boat Harbor and Mandurah. Swan Jet should expand its consumer base by crafting a marketing strategy to target the corporate market through communication channels with Perth HR managers that offer exclusive packages for corporate events. The segment of university student can be potentially developed with a complement marketing strategy that includes special prices and benefits, alliances with educational centers and advertising campaigns. Additionally, the inclusion of a new distribution channel such as Swan Jet tickets being sold on the Rottnest Express Ferry on the Swan River with their 150,000 annual passengers will allow for entrance into new segment markets. Product development strategy Swan Jet can generate new products for the current market in Perth to promote sales growth18. Specific tactics such as product innovation and the addition of new characteristics to the actual product support product development should be used17. Swan Jet has access to an additional boat that could be used as a river taxi service for special occasions, or tourists wanting a private boat trip. Swan Jet could also enter into a joint agreement with the bar and restaurant “The lucky Shag”, offering Swan Jet customers a 10% discount on food and beverages before or after the Swan Jet ride. Diversification Strategy The offering of new products to new markets can be accomplished by utilizing three different strategies: diversifying through related and unrelated products and vertically integrating with suppliers or distribution channels1718. Swan Jet Adventures can implement related diversification by offering jet boat certification, sailing lessons, and jet ski hire. Using the owners‟ reputation, experience and network can increase the market size and through vertical integration strategies, the company could utilize these elements to develop a “Hire a Skipper” company. This is where large private boat owners and small charter companies can Page 14
  • 15. hire skippers with experience and offer maintenance services taking into account the expected increase in the number of boats in Perth and the engineering expertise of the skipper. SMART OBJECTIVES for Q2 2010- Q2 2011 Studies have shown that goals that are formulated using the acronym SMART- specific, measureable, achievable, realistic and appropriate timeframe can increase the likelihood of goals being achieved20. Given the above analyses, the following objectives focusing on increasing company growth and brand equity are recommended to Swan Jet:  Increase brand awareness by 30% throughout Western Australia with a higher concentration on the Perth metropolitan area  Evaluate their target market segments and monitor specific strategies to grow each  Focus more attention on short term marketing strategies to increase customer numbers to assist the company‟s financial growth and capital which will fulfil its long-term objective Swan Jet Adventures SMART Goals : Quarter Two 2010 – Quarter One 2011 Quarter: Goals Q2 MARKET PENETRATION (Nov - Dec  Increase customer numbers for December by 60% 2010)  Increase number of repeat passengers by 30% (special offers to past passengers)  Increase brand awareness of Swan Jet throughout the Perth Metropolitan area by 30%  Increase number of gift vouchers sold by 20% MARKET DEVELOPMENT  Increase corporate bookings by 30% PRODUCT DEVELOPMENT  Food agreement with “Lucky Shag” bar and restaurant – increase from Nov numbers by 20% Q3 MARKET PENETRATION (Jan - Mar  Increase customer numbers by 60% in Jan, Feb & March 2011)  Increase number of repeat passengers by 20%  Increase brand awareness by 20%  Decrease by 30% of Redballon/Adrenalin bookings, with concurrent increase of 30% by own online bookings MARKET DEVELOPMENT  Increase corporate bookings by 20%  Increase student bookings by 20% (New uni semester) PRODUCT DEVELOPMENT  Offer water taxi service Q4 MARKET PENETRATION: (Apr - June  Increase customer numbers by 50% in April, May & June 2011)  Increase number of repeat customers by 20%  Increase brand awareness by 10% MARKET DEVELOPMENT:  Increase corporate bookings by 20% Q1 MARKTET PENETRATION: (July - Sept  Increase customer numbers by 20% in July & September 2011)  Increase brand awareness by 20% MARKET DEVELOPMENT:  Investigate possibilities of opening up Jet boat businesses in Mandurah and Hillary‟s Boat Harbour – investment required, licensing requirements, and customer segments. Overall goal of increasing passenger numbers by 50% Page 15
  • 16. MARKETING MIX The Marketing mix is the set of tools including short-term and long-term strategies to shape the nature of the service offered to consumers21. Marketing communications are the ways by which firms try to inform, persuade, incite and remind customers either directly or indirectly about the brands they sell. It represents the voice of a brand and the methods by which companies can engage in a conversation with consumers concerning their product offerings22. Furthermore, the challenges presently faced by markets in the design, implementation and evaluation of marketing communication programs are very different from the challenges faced 23 by marketers 20 to 30 years ago . Effectively designed and implemented marketing communication programs are priceless for building organisation‟s brand awareness and equity position. POSITIONING & SEGMENTATION Swan Jet operates in a small niche market with several competitors; however the company has a number of points of difference compared to other companies offering adrenaline activities as shown in table below. Swan Jet Adventures Present Generic Strategy Basis of competitive advantage: Competitive Scope: Cost Differentiation Broad Target Market Lowest cost Leadership Differentiation Narrow Target Market Focus – cost Focus – differentiation (Source Hubbard, Rice & Beamish 2008, modified by author) When developing the customer segments for Swan Jet, a survey was undertaken to identify and analyse customers into segments24. Swan Jet has a broad customer based as discussed in the customer section and as a result from the survey results; however four segments were identified for targeted marketing mix strategies: Corporate Clients, International Visitors, University Students and Young Professionals. Although focus is on these four customer segments, it is recognised that the end user of the service is not always the buyer, thus the buyer may not be in the targeted segments for Swan Jet, particularly as Swan Jet does sell numerous gift vouchers25.West Coast Jet is the main direct competitors with the differentiation between the two companies below. West Coast Jet is the main direct competitor to Swan Jet Adventures as they also offer a jet boat ride to customers. However there is still differentiation between the two companies as outlined in the table below. Page 16
  • 17. Similarities and Differences between West Coast Jet & Swan Jet Adventures Points of  Both offer Jet boat rides Parity:  Both boats able to do fish tails, bucket stops and travel at high speeds  Both offer pictures  Both target “adrenalin experience” customers  Both weather dependant Points of  Swan Jet operates on the Swan River Difference:  West Coast jet operates on Fremantle ocean  West Coast jet offers Whale watching tours  West Coast jet boat seats more passengers – however passengers do not sit as close to the water thus different ride experience  Only Swan Jet can do 360 degree turns – passengers also feel closer to the water  Swan Jet gives commentary about the major landmarks of Perth as well as information about the Jet engines  Swan Jet ride is 5 minutes longer, as well as $5 less expensive for children  Swan Jet has a permanent office  Swan Jet owner has unique relationship with other commercial boat companies operating out of Barrack St Jetty (thus allowing boat position change) The table below illustrates the points of parity and difference between Swan Jet Adventures and its other competitors. Although South Perth Parasailing and Extreme Ski are targeting similar customer segments, the type of experiences the customers wants determines which company receives the customer numbers. Similarities and Differences between Swan Jet Adventures (SJ)& Water based Competitors: South Perth Parasailing (SPP) Extreme Ski WA (ES) Captain Cook & Golden Sun cruises (CC/GS) Points of Parity: - Both offer Photos -Both water experience activities - Water activities - Both operate on river - Both weather dependant - Both weather dependant -Similar target audience Points of - SPP offer “sky” experience - ES offers overnight experiences - CC/GS not „adrenaline‟ Difference: - SJ river level experience - ES has high physicality compare experience - SJ ride is longer and less to SJ‟s low physicality - Targeting majority different expensive - Different services segments - SJ larger range of target customers -CC/GS offer half or full day trips with food and beverages CUSTOMER SEGMENTS CORPORATIONS In the past Swan Jet has been approached by the Water Corporation and KFC to provide the Jet boat service for employees as a result of employee rewards and state or national company functions. It was identified by the owner that this segment had the potential for growth with past marketing strategies not effectively targeting this market. It has been Irvine (2009) identified that employee engagement is 24% higher in those employees that received non-cash incentives compared to financial incentives, thus this service fulfils the criteria of non-cash incentive / reward26. Also opportunities for Swan Jet to receive repeat business are present, as employees can inform family and friends, as well as interdepartmental recommendations. Page 17
  • 18. INTERNATIONAL VISITORS This segment includes both domestic and international students, who are seeking adrenaline activities to partake in. Customers aged between 20-25 scored equal highest in the age demographics using Swan Jet. Thus potential to increase growth in this segment, with one why to further increase promotions to this age category is via university clubs/ guilds. UNIVERSITY STUDENTS This segment includes both domestic and international students, who are seeking adrenaline activities to partake in. Customers aged between 20-25 scored equal highest in the age demographics using Swan Jet. Thus potential to increase growth in this segment, with one why to further increase promotions to this age category is via university clubs/ guilds. YOUNG PROFESSIONALS This segment includes those customers who are working with suitable disposable income and are looking for adrenaline activities. Customers aged 26-30 where one of the highest age demographics using Swan Jet, thus Swan Jet should target these customers to increase their usage. BRAND EQUITY & AWARENESS Brand Equity is the differential result of brand knowledge on consumer reaction to the marketing of the brand and that effective communication enables the formations of brand awareness and a positive brand image that is in line with their aspirational brand identity25. Building brand equity requires the incorporation of brand characteristics into a company‟s overall marketing programs such as „product, price, advertising, promotion and distribution decisions‟27.Strategically oriented integrated brand communications can help organisations gain a competitive advantage in the highly competitive world of the 21st century28 but feedback from customers, prospects and publics regarding an organisation‟s brand awareness and image will ultimately enable the brand owner to adjust its brand image identity29 According to Young & Rubicam‟s BAV brand equity model, Swan Jet‟s brand position in the market is classified as „new‟ with high levels of differentiation and energy but having low levels of relevance, esteem and knowledge30. Swan Jet‟s unique adrenaline jet boating service and Swan River location differentiates itself from other boating companies. As a young company with young staff and natural annual growth who are constantly looking to improve the brand, Swan Jet demonstrates high momentum or high energy. Customers would say that Swan Jet has middle esteem as demonstrated by high word of mouth referrals from past customers. Swan Jet‟s relevance is currently low as it has not been accepted or known by most people in Perth and WA as it is a relatively new brand and due to the limited capital and marketing budget many consumers have no or limited knowledge of the brand. Page 18
  • 19. The reasons that Swan Jet has low brand awareness are due to the following:  The company is only 4 years old and has yet had ample time to gain market share  The company has no awareness of its target market segments and tracking of its customers leading to past ineffective marketing campaigns as a result  The company has had a restricted amount of capital to allocate to promotional activities and diversified media communication channels to increase presence  The company has mainly focused on the B2C market with limited activity in B2B  The old office and jetty location on Barack Street had low visibility and foot traffic STRATEGIES Swan Jet has limited financial capabilities in implementing a number of strategies over a short period of time and thus must utilise targeted multi-channel specific strategies to reach their defined target markets in alignment with the seven P‟s of the marketing mix. As a result, we would recommend a period of one year to implement the following marketing objectives across all target market segments to increase brand awareness and improve the corporate image:  Increase 21st Century Marketing- Internet and Social Media (Appendix C)  Promote Swan Jet on deal of the day websites  Utilize Outdoor Advertising  Launch of a new brand image and identity campaign  Targeted event marketing to drive traffic  Expansion of distribution channels  Customer and website visitor tracking SEVEN P’s OF SERVICE’S Marketers endeavour to create, promote and deliver value for consumers and the use of the seven P‟s of service, place, product, price, promotion, people, physical environment and processes are used to help identify the appropriate mix of marketing strategies 21. Marketing communication options or communication types can be judged according to the response and communication impact that they ultimately create25. PLACE Marketers look at several factors such as distribution channels, coverage, locations, transport and assortments to establish if any further value can be created, communicated and delivered to customers21. Swan Jet should use a push strategy in deciding its distribution and marketing channels to reach the end consumer. Page 19
  • 20. PRODUCT The challenge within the service industry is that service innovation or differentiation can often be imitated by competitors, thus no sustained competitive advantage31. Areas under product that can be evaluated and reviewed for marketing mix include product variety, quality, design, features, packaging and services21. In order to create a competitive advantage, Swan Jet should offer a ticket bundling packages with merchandise as well as implement the booking reservation system of BookD for $250 annually to initiate online bookings for customers along with a PayPal business account to collect customer payments. Swan Jet needs to promote and advertise the booking service on all social media platforms and media communication materials. The company can add advertising opportunities such as Google Ad Sense on its website for organisations wishing to promote its products and to drive additional traffic PROMOTION Factors under promotion that can be examined for innovation and value for customers include sales promotions, advertising, sales promotion, personal selling and public relations. The promotion of services needs to place particular emphasis on increasing the tangibility of a service and furthermore in the case of services marketing, production personnel are important components of the promotion mix23. It is identified in the literature that Social network sites are consumed mainly by young adults and teenagers and that information gathered from members profiles can be used for targeted advertising32. Page 20
  • 21. PRICE List price, discounts, allowances, payment timeframes and credit terms can be evaluated to see if any innovation or further value creation is possible for consumers and contribute to marketing mix21. Swan Jet current price structure can be seen in table below, with increase due to new costs. New Price Structure for 2011 NEW: OLD: Adults $55 $49 Children (14 years & under) $35 $30 Families (2 Adults & 2 Children) $145 N/A Swan Jet can incorporate pricing strategy called pricing discrimination which is when a company sells a product or service at two or more prices that do not reflect a proportional Page 21
  • 22. difference in cost33. The three degrees of price differentiation are: depending on customers demand sellers charge a different price34, those who purchase larger volumes are offered discounts 31 and sellers charging variable prices to different customer segments31. Price discrimination is applicable to Swan Jet only in the second and third degree. The findings of Morris suggest the use of price discrimination through volume based purchase is the most effective way especially in industrial marketing (B-to-B marketing)35. The table below represents current corporate/group price package (second degree price discrimination) along with tier pricing recommendations. Corporate/Group Price Package (Current) Recommended No. of people Price Discount No. of people Price Discount 12+ $45 18% 5+ $50 10% 24+ $39 29.1% 10+ $45 18% 20+ $39 29.1% In third degree of price discrimination there are several strategies: customer-segment, product-form, image, channel, location, and time/season pricing21. For Swan Jet, customer- segment and time/season pricing would be the most beneficial strategy. Customer-segment pricing is a strategy that uses different customer groups to pay a different price for the same product or service and time/season is a strategy that varies „by season, day or hour‟ 35. The table below represents current third degree price discrimination for Swan Jet along with some recommendations for Swan Jet to implement. Customer Segment Pricing (Current) Customer Segment Pricing (Recommended) Price Discount Price Discount Children $35 36% Children $35 36% Student $50 10% Time/Season Pricing (Current) Time/Season Pricing (Recommended) Morning $50 10% NONE Winter Winter season is the least profitable season for Swan Jet. We therefore recommend introducing „Black to School Week‟ promotion during winter to increase customer volume. In the morning, Swan Jet is also not attracting too much customers as they would have liked. Hence, we recommend during low traffic period to noon where traffic is more substantial, Swan Jet should discount their price to $50 to increase volume. PEOPLE In the service industry often customers perceive the employees as the service and that to add value in the mind of the consumer it is through personalization and active participation of employees that creates value36. Thus appearance, attitude and manner of employees can impact on the customers‟ perception of the quality of service that Swan Jet offers. As the service that Swan Jet offers to customers is an experience, the way customers perceive the Page 22
  • 23. Swan Jet staff can impact on their sense of value for money as well as overall enjoyment. It is recommended that Swan Jet implements staff training that includes sales training, customer service with emphasis on staff attitudes and energy levels when dealing with customers and how staff should assess the quality of service they have given37. Office staff should also be given an authorised allocated amount of budget, for them to utilise during a customer critical incident. PROCESS Process involves the systems utilised by employees to deliver the service to customers and often increases in effectiveness can occur as a result of reviewing and implementing changes to the process management systems16. A standardised customer relationship management system (CRM) for in store and online sales should be implemented to ensure that Swan Jet has easy access to rich customer data that can be utilised for future promotions. It is recommended that the wavier form is modified to gather relevant customer demographics in order to monitor KPI‟s as well as changes in target market segments. Standardise the type of information that is given to customers by the jet boat skippers, however allowing for the skippers to deliver the information in their own unique style. PHYSICAL EVIDENCE The environment setting can influence the reality of the service in the mind of the customer, thus environment and physical evidence aspect can impact the perceived value and experience the customer has 22. Swan Jet‟s servicescape needs to emit a professional yet adventurous and exciting vibe at the office which is the first point of customer contact, as well as at the customer preparation area and in the jet boat itself. It is recommended that all jackets that customers wear for the ride have the Swan Jet logo in large print on the back of the jackets, to help with Swan Jet brand recognition by passing traffic going by the preparation area. Swan Jet already uses monitors to display customer photos but they should develop a Swan Jet video which shows the Jet boat in action, as well as customer testimonials to promote the experience. Displaying merchandise in the office window and having a standardised uniform policy will help build brand recognition and increase the corporate image. The literature identifies that for a service that people are unfamiliar with, the presence of a long single line can actually maximise consumer perceived value of the service or product being offered 38. Thus as Swan Jet currently has low brand awareness, Swan Jet has two opportunities to utilise queue infrastructure, when clients are checking in and wait to suit up for the ride. It is suggested to redesign the company´s web pages to make it easier to search information, less visually confronting and to include a register link to capture potential customers´ information. This is due to research which indicates customers respond more positively to low feature Page 23
  • 24. complexity of colour and detail39. Other re-branding activities include logo adjustment and addition of company slogan “cool your thirst for excitement”. Also there are two different internet domains that are communicated to customers, so it is vital that that these are merged. BUDGET The current marketing budget of Swan Jet Adventure is $72000 constituting 25.71% of revenue (YR08-YR09). In order to break even, according to the owner of Swan Jet Adventures, 4000 customers is needed. In the last few months, Swan Jet has purchased a new location that would attract more foot traffic. With more traffic and marketing strategy, Swan Jet Adventure is expecting an increase of 40% in its sales revenue. Expenses are expected to increase by a substantial amount because of purchase of new jetty, more fuel consumption and hiring a sales person. The forecasted revenue and cost can be seen in the table below. YR 08- 09 Current Cost Structure Sales Revenue $280,003 $392,004 Insurance $20,000 Cost w/o marketing expense $178,249 $273,656 Jetty Purchase $44,000 Jetty Rent $20,000 Activities Before Current Staff $78,000 Tourist Magazines $2,640 $3,000 Workers Comp $4,000 Experience Perth $900 $1,200 Phone Bill $7,200 West Australian $11,400 $0 Office $4,800 Brochures $6,000 $6,500 Boat Maintenance $6,000 Posters $2,000 Loan $30,000 Newsletters, Direct Mail $4,000 Fuel (Estimated) $22,656 Yellow pages $8,660 $0 Staff Training $5,000 Internet marketing $8,500 Uniforms $2,000 Online booking $300 Extra Sales Person $30,000 Web site and Logo $1,000 Total Cost $273,656 Aerial Advertising $0 $4,000 Sponsorship (include charities) $6,000 Fuel calculations Promotional Products $2,500 Total Rides required 755.2 Radio $42,400 $5,000 30 Liters Per Ride 22656 Video Production $2,500 $1 a liter $22,656 Retail Outlets $6,300 Reserve $2,300 Total cost strategies $72,000 $55,100 Total Cost $250,249 $328,756 Net profit $29,754 $63,248 We have also recommended reducing our marketing budget by $16900 because of the following reasons. First, Swan Jet can reduce its marketing budget for radio as they were only getting a response rate of 3.7%. Second, Swan Jet can eliminate Yellow Pages listings off-line and online (0.2 % response rate) and continue utilizing the free listings on Google Places. Third, Swan Jet can use the proceeds from reduced marketing expense to partially fund their purchase of new jetty. Finally, we are allocating funds to a more targeted market thereby increasing response rates of marketing campaigns. Return on Investment has been calculated to be 13.02%. This is more than achievable because they are currently experiencing higher foot traffic and customers since the purchase of the Page 24
  • 25. new location. Cost includes the purchase of new location and marketing budget. This is because the purchase of new location and marketing expense is the main strategy that increases sales revenue by 40%. The combined cost of the two is $55,100+$44,000 = $99,100. The 40% increase in sales revenue accounts to $112,001. IMPLEMENTATION, EVALUATION & CONTROL ACTION PLAN Quarter two and three are the peak operating months for Swan Jet, consequently several of the marketing mix strategies will need to be implemented almost immediately to ensure that they have the maximum exposure to consumers. However once implemented a lot of these strategies can continue through the quarters as well as future years, with the majority of promotion occurring in quarters two and three. Swan Jet Adventures Implementation Plan Quarter Two 2010 – Quarter Two 2011 Quarter: Marketing Mix Strategies: (Responsibility D=Director, OM=Office Manager) Q2 GENERIC: PROMOTION: (Nov – Dec  SEO & PPC (Dec - D)  Direct mailing to corporate social 2010)  Brand Ambassadors in shopping centres (Dec– clubs (Nov/Dec- OM) OM)  Target corporate HR managers  Charities (Dec - D) (Nov/Dec- OM)  Social media = Facebook/Twitter (Dec – OM)  Target Facebook adverts (Dec- OM)  Loyalty customer discounts  Re-branding and development of company logo, website & slogan (Dec-D) PLACE: PEOPLE:  Corporate HR distribution (Nov / Dec - OM)  Sales Training (Nov/Dec-D)  Onboard Rottnest Ferries (Dec – D) Customer Service Training (Nov/Dec-D) PROCESS: PRODUCT:  Wavier Modified (Nov - OM)  Partnership with Lucky Shag bar (Dec - D) PHYSICAL EVIDENCE: PRICE:  Uniform Policy (Dec – OM)  Tier corporate $‟s (Nov/Dec- OM) Q3 GENERIC: PROMOTION: (Jan - Mar  Ticket bundling (Jan-OM)  Photo gallery SJ Facebook (Jan-OM) 2011)  Commence monthly Email Newsletter (Jan-  Listings on trip advisor (Jan-D) OM)  PR in paper & magazines (Feb-D)  Outsource PR (Jan-D)  Posters in Bars & restaurants (Jan-D) PLACE: PHYSICAL EVIDENCE:  Distribution at Hillary‟s / Rottnest Island (Jan-  YouTube Swan Jet video (Jan-D) D)  Sightseeing Bus tours distribution (Feb-D) PROCESS:  Student flight centres (Feb-D)  Online booking System (Feb-D)  Tourist information centres (Jan-OM)  Uni guild and market stores (Feb/Mar-OM) Page 25
  • 26. Q4 GENERIC: PROMOTION: (Apr -  Continuance monthly email newsletter (OM)  Corporate employee discount June 2011) programs (Apr – D)  Target Facebook advertising (Apr – D) Q1 PLACE: PROMOTION: (July -  Distribution Fremantle (Sept - D)  Advertisements WA Business news Sept 2011) (Aug / Sept - OM) PEOPLE:  Target HR managers (Aug –OM)  Sales & Customer service training (Sept-D) KEY PERFORMANCE INDICATORS (KPI) It is necessary for Swan Jet to implement strict record keeping in order to tract how successful and effective marketing strategies are and how they have impacted on customer numbers. The KPI information can be recorded directly (customer) and indirectly (booking agents) and be analysed monthly.  Increase brand awareness by 30%. - How customers heard about Swan Jet.  Evaluate their target market segments and monitor specific strategies to grow each. - Record which discount offer / promotion did they used. - Have they ridden with Swan Jet previously? - Where did they buy tickets from & did they buy a ticket bundle? - Record customer demographics.  Increase customer numbers. - Use table below to monitor if company is on track to reach overall 50% increase in customer numbers. Target Customer Numbers Q2 – Q2 Quarter: Past Numbers: 09/10 Target Numbers: 09/10 Q2 1596 2358 Q3 2241 3585 Q4 826 1239 Q1 306 370 TOTAL: 5000 7552 To evaluate people and process marketing initiatives, Swan Jet should on one day every week offer passengers a free photo if they complete a survey asking for customer feedback on their experience with Swan Jet. This information should be analysed monthly by the Director. RECOMMENDATIONS & CONCLUSION The 2011 Marketing Plan designed for Swan Jet Adventure was developed taking into account that the company has been present in the market since only 2007, with no actual planned marketing strategy and with a limited budget according to its market size. The plan Page 26
  • 27. introduces new strategies that mainly focus on achieving the brand awareness, sales and growth from a generic focus as well as specific strategies to target corporations, university students, young professionals and international visitors. Our recommendations focus on implementing targeted short-term strategies from November to March 2010-2011 to meet company objectives, through a multi-channel communication mix focusing on place, promotions and service marketing activities such as:  Implement customer service training to increase customer service satisfaction, which can increase word of mouth referrals and customer loyalty  Internet SEO and PPC Google Ad Words and sweepstakes campaigns to drive traffic  Implement and regularly use social media marketing platforms effectively such as tagging photos and videos of all customers to increase awareness through news feeds and updates  Complete re-branding effort of the website and logo including a new booking system, social media integration and company slogan “cool your thirst for excitement”  Measure and evaluate the results and effectiveness of the marketing strategy plan on a monthly and quarterly basis through the use of KPI‟s  Track all customers in a CRM database and receive feedback from customer experience questionnaires  Increase distribution channels through retail outlets and higher traffic internet retailers The seven P‟s of Service Marketing-Mix was used to identify the specific strategies to deliver value to the customer. Short term strategies were established with the aim of fulfilling the marketing objectives of the company. Pricing discrimination strategy was used to enhance the number of passengers through group special value packages, and special discount for students taking into account the growth potential of the segment. It is expected that for 2011 Swan Jet would achieve the overall objective of increasing by 50% its number of passenger as a result of the new location in conjunction with the implementation of marketing plan. As a second step, it is recommended to Swan Jet to implement additional marketing strategies focused on diversification and new product development as a way to increase profitability. Page 27
  • 28. APPENDIX 7 Appendix A – Recreational boats versus Population in Perth Appendix B 14 – WA Population 2006 versus 2025 Appendix C- Social Media Stats of Australia Page 28
  • 29. Appendix D–Internet Gift Retailer Process (Source: Data compiled by Redballon.com.au and modified by author) Page 29
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