Strategic Marketing Plan

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Company description

Toolik Baby Diaper Clutch with Waterproof Portable Changing Pad for Quick Change… Portable Diaper Changing Pad Clutch with Large Cushioned Changing Mat – Waterproof Full Body Portable Changing Station with Pacifier Clip and Diaper Dispenser Bag by EDELFEELCrayZ is an online company. It was established by John and Mary Smith, a couple who decided to introduce a diaper changing clutch business. The clutch has a padded, soft surface which makes it change the baby safely and comfortably. It is the best for out-going parents. The outside part is made stylishly but the inner part has everything needed for a quick change. Compared to other portable diapers, this recyclable clutch is durable because of the waterproof nature as well as cotton material that can be wiped. It can be easily folded and light weight, takes a small space and fits in the purses, diaper bag, or travel bags. It is portable because of the hand strap which can be fastened to a shoulder. It has convenient pockets for storage with several rooms. All the requirements are stored in one place and can be accessed conveniently during changes on car rides or short trips. The external zipped pocket can hold the mom’s money, keys, or baby gadgets. The clutch is compact but spaced when opened. It protects the baby from dirty surfaces, germs, and cold. The large pad covers the baby’s body fully, safeguarding the sensitive skin, not contacting the public facilities which harbor bacteria. This mat can be hand washed. Aside from the changing table pad are a diaper dispenser bag and a pacifier clip. Hence, the baby’s pacifier is kept nearly and clean with the pacifier clip. It contains a loop which will accommodate all pacifiers. It is free from BPA, latex, lead, and phthalate. The sourcing nation is China. The company has three staff. Its vision is to be the best ecommerce company for portable changing diaper clutch. Its mission is to offer unique clutch that any parent on the move requires without feeling embarrassed and stressed to change the baby anywhere. This ensures that the baby is happy always which is dream of every parent. CrayZ was founded in 2020 and is located in Texas.

Forces analysis

Trade Regulations: U.S. and China

Issues on china’s policies in relation to innovation, technology, and intellectual property alerted the Trump Administration to investigate those polices in 2017 by launching Section 301. From the investigation, the U.S. acted against China by highlighting China’s use of joint venture requirements, administrative review as well as licensing processes, and foreign investment restrictions to force technology transfers from the U.S. companies to a Chinese unit; has unfair licensing practices which block the U.S. firms from obtaining market returns for their internet protocol; guides and facilitates acquisitions and investments which produce huge technology and the internet protocol transfer to support the industry policy goals of china; and carries out and supports the cyber intrusions in the U.S. networks to access important information (Congressional Research Service, 2019). This trade war has made the U.S. to raise tariffs by 25% on China’s products valued at $250 billion. In return, China’s increase is on $110 billion U.S. products. China’s tariffic rates range from 5 to 25%. The U.S. has warned China on increasing tariffs on the remaining products.

The trade conflict between the U.S. and China could lower the bilateral ties, disrupt the global supply chains, and reduce economic growth. In 2019 for example, the imports from and exports to China declined by around 14% and 20% respectively (Congressional Research Service, 2019). There are concerns that imposing of tariffs on almost all the china’s products could be expensive to the U.S. consumers inclusive of the firms which rely on China for business. China could revenge by controlling the operations of the U.S. firms in the republic of China, lowering its U.S. treasury securities holdings, and affecting the exports of rare earth minerals to the U.S.

Another challenge is that the U.S. market is saturated. The market is flooded with diaper clutches and is accessible both in stores and online. In addition, the U.S. households are reducing, with birth rates reducing to approximately two kids in a family. CrayZ can maximize on the opportunity of technology. As it sells its products online, it should be ready to source for customers from all parts of the world, particularly developing nations such as India and Africa where birth rates as well as population growth are still high. It should sell the product at a fair price to gain market share.

Competitive forces

The competition is stiff. The diaper changing clutches from different companies are available at online sites such as Amazon and eBay. The customers can also purchase this product at big retailers such as Walmart and at a cheaper price.

Global diaper bags market The key players are Disney, Carter’s, J.J. Cole, Sanrio, Graco, Arctic Zone, Trend Lab, OiOi, Sunveno, Amy Michele, Petunia Pickle, Storksak, and Ju-Ju-Be. The retail stores have the largest share of at least 50% (see diagram) (Grand View Research, 2019). The key competitors are reaping huge profit from retail sales. However, there is a tremendous deterioration in baby products sales by retail. The online channel is expected to increase at 3.1%. The international market will raise its sales via online channel because of product varieties, easy return, discounts, and home delivery. Brick and mortar stores are venturing online to build customer base.

The manufacturers are developing trendy and compact bags that have utility features that support distribution of the load evenly, which will increase the demand for the diaper bags. For example, Cole offers stylish satchels with plenty of pockets to store stuff. Furthermore, the bag has a liner which is removable internally to clean up the mess rapidly. Globally, the market size was $655 million in the year 2018 (Grand View Research, 2019). It is expected grow to 2.9% rate in the next five years. The convenience provided by diaper bags to store and carry baby products will influence demand. The growing preference by consumers for organized storage bags, easy travel, as well as the innovations with regards to capacity and design are factors which drive global market growth.

In terms of bag types, backpacks lead with 37% market share (Grand View Research, 2019). These diaper bags are alternatives the shoulder strap bags for diapers which can be carried easily and has more pockets. The hands are free when travelling enabling it to carry the baby and offer more comfort because of the shoulder straps which are padded. It is versatile and spacious and can be carried by all genders as it does not portray femininity.

Tote diaper bag is becoming popular. It is expected to grow at 3.4% rate within five years (Grand View Research, 2019). It is gaining popularity among the mothers who like carrying fashionable bags purposed to act as a diaper bag.

Regionally, North America held the largest share of 29% triggered by high purchasing power, increased travel rate accompanied by infants, and rising number of women who are working. The working women percentage with children less than five years was 65% (Grand View Research, 2019). The next growth place is the Asia-Pacific region at 3.7% rate, driven by skyrocketing birth rates, and rising working mothers in for instance, India and China.

Economic forces

As explained above, the demand for the portable diaper bags is expected to rise rapidly. Among the economic factors which drive this demand is disposable income, purchasing power, increased working mothers, and increased standard of living. As CrayZ plans to import the diaper bags from China, it will face exchange rate fluctuations. Trump administrations also want to increase tariffs on China’s products which will raise the importation fees, eventually paying high prices for the product. The labor cost proposes china as the preferred country to order the diaper clutches than the U.S. It has cheap workers, affordable, and available raw materials such as cotton to make the diaper clutch. The suppliers must therefore; increase the supply of the portable clutches to meet the rising demand.

SWOT analysis

SWOT helps to analyze a company internally by assessing the strengths and weaknesses. It also analyzes externally by examining the opportunities and threats.

Strengths

The portable changing clutch is nice whenever the persons want to carry necessities. It is well-spaced which can be used by a young baby until it becomes a toddler. The spaciousness means adequate room to change the baby. It exhibits a compact nature. It is comfortable as the surface is soft and padded, resembling a thin mattress layer which is comfortable for the baby. It is easy to clean. The person wipes the waterproof surface with wipes or damp cloth or even washes it. It is portable. Even though it can be fitted in a diaper bag, the changing clutch can be hooked to a stroller, shoulder, or wrist. It is waterproof. It is made from cotton material which is friendly to the skin, can be cleaned easily, and washed. It is safe because it does not contain hazardous cancerous metals such as lead, phthalate, and BPA. It has convenient pockets, two inside mesh pockets meant to hold baby items and an external pocket for the mom’s stuff. It also has a stylish pattern and making it appropriate for trendy couples. The company also benefits from low costs of production as it orders the final product. The employees are loyal, a contributor factor to serve the consumers whole heartedly.

Weaknesses

The company is still young therefore; it is struggling with low finances. The other is increasing research and development to ensure that the product sold is safe for the baby and efficient. CrayZ can encounter costly litigations if the diaper clutches have chemicals which can harm the baby. Such issues can taint the corporate image and affect sales.

Opportunities

The changing demographics which indicate increased travelling activities promote the sales of diaper clutches. The most travelling lot is families. Additionally, picnics and camping are some common recreational activities among the U.S. families, which will raise diaper bags usage for light and organized carry. Airlines also restrict cabin luggage which trigger demand for compact diaper bags.

Online selling creates opportunities for diaper bags. Global and premium brands plan to obtain a wide customer base via online retailing (Grand View Research, 2019). Around 20% of the purchases placed on baby’s products are done online.

The internet presence makes it easy to advertise at a low cost compared to traditional techniques such as TV commercialization. The product can be advertised on the website and on social media platforms. Online reviews will fetch more customers. Customers want assurance about how good the product is and if it will satisfy a need.

Threats

Baby diapers have been campaigned to have long-term impacts on the baby. They have been blamed for toxic chemicals which can cause cancer among others such as skin and liver diseases. The consumers are also becoming more health conscious. They are inclined toward organic and natural products. The baby’s skin is delicate and sensitive and vulnerable to rashes and skin irritation hence, the requirement of a natural, organic product to guarantee baby’s safety.

The strengths can be used to leverage the threats and weaknesses as well as opportunities. For example, CrayZ diaper clutch is safe. It is made of cotton which is an organic material which health concerned customers like. The litigations and concerns over toxic materials on the diapers can be ruled out by the eco-friendly diaper.

References

Congressional Research Service. (2019). Enforcing U.S. trade laws: Section 301 and China. Retrieved from https://fas.org/sgp/crs/row/IF10708.pdf

Grand View Research. (2019). Industry analysis: Diaper bags market. Retrieved from https://www.grandviewresearch.com/industry-analysis/diaper-bags-market