MK 43-815-04/81 Marketing Management in Practice - FAN PUI SZE Student No.

10242638

Trinkett Toys
Introduction The organization history and background
Trinkett Toys is a professional manufacturer of plastic toy factory with factories in China. The company was founded in 1970s and its head office in Hong Kong. Trinketts products are sold under its customers brand names and designed to their requirements. She designs the products and prepares the standard samples by means of continual developing various merchandises so as to save time and money that customers have to pay by offering stocks and selections. She is able to support the technology service on the special specification. Because of the good quality, competitive price and on-time delivery, she has successfully earned a great reputation and received many orders from the world-famous companies such as Disney and other large wholesalers in North America, Europe and Japan.

Mission

The mission of Trinkett Toys is to deliver innovation design, high quality and economic products that achieve real benefits for customers.

Executive Summary

As all of the toy manufacturers are facing the factors of external environment threats. The similar problems are labour shortage, power shortages, rapidly rising costs and global economic recession1 etc. They also face similar risks arising from safety violations, which mainly claims from America and Europe and asked for recall2. E.g. in recent suicide of a Mattel subcontractor. In order to break out of this situation, Trinkett proposes to develop and sell a new line of toys under its own brand name Trinkett Toys.

Target Market

The targeting Market is Asia3 which cover 25% toy market share in the world on 2007. It includes Mainland China, which is one of the main markets segment in Asia.

Marketing objective and strategy

To maximize the sales revenue and market share, Trinkett is planning to develop and sell a new line of toys under its own brand name by market and products development strategy. And develop the company brand awareness and acceptance in the toys market industry.
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11 Nov 08. New recession fears ahead, BBC News Available: http://news.bbc.co.uk/2/hi/business/7728649.stm [accessed 15 Nov 2008] 2 6 Nov 08. EU plans tougher toy safety rules, BBC News Available: http://news.bbc.co.uk/2/hi/europe/7713768.stm [accessed 15 Nov 2008] 3 2007. ,Share of Toy Market by Key Region, International Council of Toy Industry (ICTI) Available: http://www.toy-icti.org/resources/wtf_2006_files/fullscreen.htm#slide0209.htm [accessed 15 Nov 2008] -1-

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Market audit Macro-environmental analysis- SLEPT

Opportunities Matrix (Appendix1) 1) Social Society and Culture Trend: Nowadays, children are the the Pearl of their parents, parents are looking for the educational and developmental toys for their children as Psychologists now recognise importance of play to learning, contribute to a childs physical, mental, social and emotional development. Growing awareness among parents which leading to faster growth of this sector than toy market as a whole 4. Opportunities: increasing demand of high quality educational and developmental toys. 2) Economic Trend: Although the World Bank expects China's economic growth on 2008 will slow down to compare with 2007. They expected China still has 9.4% growth in 20085. Actually China is under a rapid economic development in recent years. Opportunities: increasing purchasing power in China which is one of the main segment markets. 3) Political Trend: The factories of Trinkett are staying in China, the Chinese government policies have play an important role for the factories running direction. The Chinese government has just announced a series of measures worth $586bn. The measures are designed to make sure the Chinas economy keeps going up6. Besides, China takes action on toy safety7 Opportunities: Chinese government policy strengthen the factory and market confidence, it helps to increase the demand to China production products. 4) Technological Trend: Mature and well developed internet technology even in Asia. People could search for the toy product outlook designs and features in the internet websites. Opportunities: Provide an interactive communication with consumers and gather the market information by internet date analysis.
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2008. Toy and Child development, International Council of Toy Industry (ICTI) Available: http://www.toy-icti.org/info/toysandchilddevelopment.html [accessed 15 Nov 2008] 5 1 Apr 2008. China's economic growth to 9.4 percent in 2008. CNBC Available: http://www.cnbc.com/id/23891593 [accessed 8 April 2008] 6 10 Nov 08. Chinas new economic plan, BBC News Available: http://www.bbc.co.uk/blogs/thereporters/jamesreynolds/2008/11/chinas_new_economic_plan.html [accessed 15 Nov 2008] 7 22 Nov 07. Chinas new economic plan, BBC News Available: http://news.bbc.co.uk/2/hi/business/7107093.stm [accessed 15 Nov 2008] -2-

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Threats Matrix (Appendix2) 1) Social Trends: As the Chinese products are always indicated by bad quality, it affects the perception of people towards a Chinese product. Especially start from YR2007, over 4.2million of Chinese-made toys was recalled in US.8 Threats: Consumers dont trust the performance of Chinese-made toys 2) Legal Trends: Because of bad quality of Chinese toy products were found in US and EU, the main market countries (US, EU, Japan) in place of their individual safety standard codes toward the Chinese-made toy products.9 Threats: Governments tighten the quality standards, in order to pass the safety policy; it involved a high cost to keep the products above the safety standard. And the products may have risk to fail in the testing. 3) Economic Trends: the RMB will continue to rise against the US dollar strengthening despite rising inflation.

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, the Chinese currency

Threats: Increase the production cost in terms of RMB. US dollar valve is relatively lower; it decreases the export rate in China. 4) Technological Trends: As continued growth in electronic sector, children being exposed to electronic toy products. E.g. NDS, PSP etc. Threats: decrease the demand of plastic toy products.

8 Nov 2007. Toy recall in US. Cable New Network (CNN). Available: http://www.cnn.com/2007/US/11/08/toy.recall/index.html [accessed 15 Nov 2008]
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25 Sep 2007. EU demand a new toy safety symbol. BBC News. Available: http://news.bbc.co.uk/2/hi/europe/7012460.stm [accessed 15 Nov 2008]
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27 Feb 2008. RMB rising inflation. Research Institute of Economy, Trade & Industry (RIETI). Available: http://www.rieti.go.jp/en/china/08022701.html [accessed 15 Nov 2008] -3-

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5-forecs industry analysis Competitive analysis (Appendix3)

1) The threat of entry - Economies of scale - it is benefits associated with bulk purchasing of materials. - Low cost of entry - it is costly for the technology and infrastruture development. - Low capital requirment - Low cost of switing - High Brand loyalty - Competitor retaliation 2) The power of buyers - Large number of buyers in a market The cost of switching buyer is low

3) The power of suppliers - The power of some suppliers are high- few high quality materials supplies. - High demand and high supply components of raw materials - The switching costs are low. 4) The threat of substitutes - Others electronic product could replace part of the function of Toys. - No completely subsitition- Toys is important to peoples life.

Market trends

The most obvious and important trend in the market is continued growth in China toy market demand. In Asia, Japan childrens market shrinking as population declines, leading to falling sales and increasing focus on adult toys. Life cycle of toys is getting shorter as children grow up faster and looking for innovative toy design. At the same time, continued growth in electronic toys designed, children being exposed to electronic products as they are more functional and attraction. Licensed product sales strongly influenced by major cartons and sporting events. More toys are being sold in mass market outlets (e.g. Toysrus in HK) as against traditional toy stores. Increasing the regulation owing to growing buyer concerns over health and safety, workers treatment, and the environment

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Competitive situation facing the organization Product differetiation

Trinkett Toys mainly focuses on the plastic toy production and design. Nowadays, its key competitors are trying to diversify the product differetiation and toy product categories. E.g. Playmates Toys Inc.- focusing on feature dolls, action figures and interactive electronic toys. Manley Toys Ltd- Multiple product categories including preschool, plush, plastic, wood, inflatable, water and pool toys, battery-operated, radio control, plug and play, musical instruments, and youth electronics. As the product life cycle for a toy product is short. Widen product categories could help to gain the market share.

Relationship marketing

Transactional Marketing which is just focus on the production strategies. In order to strengthen the market competitive advantage, relationship marketing should be adopted. E.g. Kin Yat Holdings Ltd- the main activities design, manufacture and sale of high end toys, especially controlled & educational radio. Their R&D team has over 60 people who focus on new and innovative products. R&D teams develop the product categories according to customer needs and wants. The purpose is to create the core value to their customers and trying to understand what they want.

Electronic toy products

Children being exposed to electronic products, just like NDS, PSP. The traditional toy products are replaced by the electronic products gradually. E.g. Vtech operates successfully within a narrow electronic learning product sector, namely, children electronic laptop, education electronic games. Vtech can gain the market share successfully because he fully understands the market demand. Parents are looking for the education products to train up the children.

Segment markets
Geographical segmentation The main marketing segments of Trinkett Toys are North Americas, Europe and Japan. Demographic segmentation The target Customers of Trinkett Toys should be Millennial and Generation Y who have relatively higher interest in the toys and more leisure time. Psychographic segmentation As I mentioned before, parents concern over health and safety for the toys products to their young children, the branding can help to gain the confidence for the product quality.
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Innovative and entrepreneurial spirit: To deliver innovation that achieves real benefits to customers. It could be achieved through creatively and continuous improvement for product and service which are delivered with speed and efficiency.

Specific position
Accuracy and truth-seeking: To manage the business and make decisions based on carefully understood facts.

Marketing Mix Product

The leading-edge toys products are highly acclaimed for user-friendly, tailor-made designs and customized solutions for various customer needs High quality and safety products are highly appreciate to build up trust and personal responsibility to all relationships.

Place

Indirect selling by retailers Trinkett toys mainly promote the toy product by retailers, especially by mass market outlets.

Price

Trinkett could adopt the Product Line Pricing strategy which set the price step between Product Line items. 1) To focus on attractive prices and thoughtful design, it is perfect for relatively low income family. 2) To track record of success and professional educational products. The selling price is relatively high.

Promotion

The main promotion tools - advertisement in newspaper/ magazine - sales promotion by special offer - personal selling by direct or online marketing - public relation to post up company updated information - Even Sponsorships

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Recommendations for the growth strategies.

Trinkett proposes to develop and sell a new line of toys under its own brand name Trinkett Toys. Marketing Penetration Sell more same products to same markets by lower the price. Marketing development Sell more same product to new markets. Mainly focus to Asian market which including mainland China which is a potential large market. Product development Sell new product to same markets. To cater for the consumers, launching the Trinkett Toys company brand with new design, it is going towards a right direction as toys are the fastest growing sector in the market.

Budget
Trinkett Toys has existing infrastructure for factories and production line. The new project budget is mainly focus on marketing research and new product development plan;
Milestone Business Plan Online Research Open Accounts with Suppliers Door Research Design Doors Order Sample Doors Design Sales Literature Print Sales Literature Make Industry Contacts Showroom Feasibility Study Totals Start Date 15/1/2009 15/1/2009 15/1/2009 15/1/2009 15/1/2009 22/1/2009 22/1/2009 1/2/2009 15/1/2009 25/1/2009 End Date 31/1/2009 19/1/2009 26/1/2009 26/1/2009 26/1/2009 1/2/2009 31/1/2009 7/2/2009 28/2/2009 31/1/2009 Budget Department HK$20,000 HK$3,500 HK$3,500 HK$5,000 HK$4,500 HK$10,000 HK$10,000 HK$3,000 HK$10,000 HK$10,000 HK$79,500 Marketing Marketing Web Web B&D B&D B&D HR Legal Dept Marketing

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