PLEASE ANSWER ALL QUESTIONS IN ORDER FROM 1 TO 3
1. Using Figure 1 as an aid, define and critically evaluate two target
segments for Step2. Then, theoretically and analytically assess
how these target segments make purchase decisions, including
possible influencing factors. Last, critically compare these target
segments and decide which is more attractive.
2. Critically evaluate the selected most attractive target segment’s
(selected in Question 1) likely attitude towards Step2 using
appropriate theories and concepts. How is the company
reinforcing or changing this attitude using its revamped website
(see Figure 1)?
3. Using relevant consumer behaviour theories, critically assess the
most attractive target segment’s (selected in Question 1) likely
motivation for engaging with STEP2 on social media channels, such
as Facebook and Instagram. Based on this analysis, provide a
recommendation to STEP2’s CEO on the appropriateness and
objectives of these channels and how to evaluate this investment.
Please read the following case study to answer the exam questions.
SUCCESS: STEP2’s REVAMPED WEBSITE INCREASES SALES BY 26.3%
Step2, a manufacturer of plastic toys for children, made a very bold
marketing move. In the heart of its most important business season, the
company completely changed the way it presented its products on the
company website.
The company sells directly to the public, but an overwhelming majority --
around 90% -- of its products are sold through retailers such as Walmart,
Amazon and Toys"R"Us . In a sense, the smaller consumer aspect of
the business competes with the much larger reach it gets from selling to
retailers.
To square that circle, the marketing team at Step2 decided to post on
the e-commerce website both its consumer price, as well as provide
pricing and links to merchants that sell its products. This essentially sets
up the Step2 site as a potential one-stop shop for any customer.
Tena Crock, Online Marketing Director, Step2, said the timing of this
change made the success of this effort very important to the company,
but also provided a wealth of data to give the marketing team a solid
reading on whether it worked or not. "We started it in December, which
was a little scary," she said. "Seventy five percent of our sales come in
from Black Friday through Christmas Eve."
One issue was the consumer piece of Step2’s business was competing
with retailers selling its products. When Walmart and Amazon would
enter into a price war, Step2’s e-commerce side would also lower the
consumer price of the product. Shipping costs became an issue, and
Step2’s consumer sales margins were being severely cut into. With this
in mind, the marketing team came to a conclusion. Crock stated, "The
message we wanted to get out was, ‘We don’t care where our products
are sold.’" She added, "We just wanted to make sure that we are selling
our products."
Because Step2’s retail clients started devoting less shelf space to its
large, bulky products -- such as plastic wagons -- the Internet became
increasingly important for sales, causing another issue. People would
find these products with a Web search, reach Step2’s site, but then
leave the site to buy the Step2 product elsewhere. Worse, they would
sometimes find a competitor’s product in the searched for category, such
as "play kitchen" or "swing set."
To combat all these issues, Step2 decided to continue selling direct to
consumers on its website, but also include comparison prices and links
to help ensure its products are sold, no matter what company actually
completes the transaction.
Once Step2 began listing retailers’ prices, the website became a vital
tool for Sales since many of the big box clients, such as Toys "R" Us,
were selling Step2’s products, but not devoting shelf space for the large
items.
Organic traffic was important, but the marketing team also used paid
search using broad terms -- such as "playhouse," "climber" and "wagon"
-- to drive traffic to the product detail page for the latest item in that
category. Website visitors could buy that product from the product detail
page, but they were also presented with comparison shopping prices to
retailers with links to those websites.
The goal for the marketing team was to get traffic to Step2’s site for
these broad search terms that matched its products, and then ensure
that if the website visitor navigated away from the page, it was to a
retailer selling its products. The team wanted to avoid potential
customers going back to the search engine where they might find a
competitor’s product.
To improve organic traffic to the Step2 website, the marketing team
employed a number of content strategies. Adding rich media, such as
video, was part of this effort. Video added additional value for the
company since retailers were not devoting as much shelf space for the
products. Video created a way for customers to see the products in
action.
Crock said, "People can see the value of our product and recognize the
play value." User-generated content in the form of product reviews was
another aspect of the content strategy. "We have over 20,000 reviews
on our website for our products," explained Crock, "And our reviews are
indexed for search."
The company included a gamification element where if reviewers added
a picture or video to the product review, they would receive points. To
date, Step2 hasn’t decided what to do with the points, but reviewers are
accumulating them. A final element to improve organic search was an
overhaul of the URL structure, where the URL included the product
number, product name and product category.
See Next Page
Figure 1: Creative Sample from Step2’s e-commerce strategy
Final Page