Paper Example on Marketing:Travis Perkins Challenges and Recommendations

Travis Perkins plc. is a company in the UK that specializes in the building and home improvement market. The company has been operating in the supply, building, and construction trade for more than 200 years (WHITESIDE, et.al, 1993, 18). The builders merchant, which employs approximately 24,000 employees, has had to suffer the consequences of UKs exit from the European Union. This vote has prompted Travis Perkins, the owner of Wickes chain to reveal its plans to shut down at least thirty of its branches all over different countries therefore losing a significant clientele base and risking at least 600 jobs. The potential losses have become the latest in a series of profit cuts announced by companies in Britain one month ago. To counter this loss in business profits, Travis Perkins should consider employing special marketing strategies to gain a new clientele. Although successful marketing takes perseverance and patience, it is worth the time and effort (Warszawski, 1996, 137). And with it, Travis Perkins can prepare its new consumers for an experience that they will be willing to pay for. This paper provides in depth analysis into this business loss challenge that Travis Perkins faces and discusses marketing as the relevant and most suitable corporate function to address the challenge.

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Challenge

Due to the UK vote that set Britain in an exit path from the European Union, several British-based companies have had to close their business operations within Europe (Masouros, and Papadopoulos, 2016, 208). Travis Perkins had to close ten of its foreign distribution and fabrication centers plus an additional thirty branches. Still, the company has to review the future of its heating and plumbing business after its sales dropped by a significant 3.9% in the third quarter of this year. According to latest financial reports by the Companys chief executive officer, John Carter, the business closures will spread across Travis Perkins trade brands (i.e. Travis Perkins, its heating and plumbing business, Benchmarx, BSS, and PTS, and its kitchen and carpentry arm). As regards to its affected staff, the company has stated that it hopes to relocate some of the employees to other business locations (Ojo, 2016, 2). According to the company CEO, the cuts are necessary because it has become difficult to predict the level of future demand. This he has blamed on Brexit and the increase in the stamp duty on home purchases.

Brexit has therefore been an undeniable challenge for most British-based companies due to the high level of uncertainty it has brought with it (Dhingra, et.al, 2016, 12). For example, if Travis Perkins was operating without Brexit, it would be much easier to predict performance in 2017. Fortunately, the British government made the decision to change the status of buy-to-let tax thereby causing a great spike in housing trades in March this year. Nonetheless, this action by the government is still winding down to get to a stable level. Based on the impact of increased housing transactions alone, the level of uncertainty would not have been as big as it now that Brexit has occurred. Travis Perkins CEO asserted that their market performance in 2017 would be soft. However, he warned that this was just because they were working on the theory that it is going to be soft. Hence, the CEO finds that notable factors such as the amount of disposable income as well as consumer confidence should be key determinants given that the experienced has not experienced this situation before.

Travis Perkins investors were warned that the company would incur forty to fifty million euros in restructuring by the end of this year. However, the executives asserted that two-thirds of this amount will be the write-down of its assets value and not a cash loss. As company investors took in the high cost of restructuring and reduced profits during the last quarter, Travis Perkins shares closed down at 4.5%, which is equivalent to 14.22 euros. This performance has been attributed to a sharp contraction in the plumbing and heating business given that the builders merchant enjoyed an increase of 3.4% in group sales as of the third quarter this year. This promising performance earlier this year was steered by a 9% increase in sales to consumers. In defense of the plumbing and heating business, the CEO stated the business was structurally challenged. The chief executive noted that homeowners today opt for online alternatives to get repair and installation services at the expense of major purchases. As of October, Travis Perkins announced that if it could sell the plumbing and heating business, it would end up doing so given the sector does not attract as many investors. As much as Travis Perkins is almost done with its five-year renovation of the group by shutting down unprofitable stores and expanding in healthier market areas, the companys management should revamp its marketing strategy to create a high-performing housing company (Bonoma, 1985, 1).

Recommendations

Setting up a budget

To commence an effective marketing strategy Travis Perkins first needs to set up a realistic and well-revised budget (Cravens, and Piercy, 2006, 1). Therefore, before deciding how much money it wants to spend on marketing, Travis Perkins should be aware of what it is it wishes to pay for. According to marketing research, a company should spend one to ten percent of its revenue on marketing although there are other ways of marketing a companys products and services. It is important to note that no matter how a companys budget is arrived at, looking into the disposable revenue and determining how much can be spent directly affects the success of the marketing campaign (Jeannet, and Hennessey, 2005, 11). Therefore, by setting up a budget, Travis Perkins will also acquire a clearer sense of what they will be willing to invest in and what they should leave out.

What the company would like to be known for (Specialization)

The next issue Travis Perkins should take into consideration is what they would like to be known for or associated with. To do this means that Travis Perkins wishes to be recognized for their experience and high quality but not cheap products and services. According to marketing professionals, a company should hope to be associated with a number of properties including professionalism, reliability, good quality, and good value. It is important to note that low price is not among the properties because creating such a reputation normally results to low margins (Kotabe, and Helsen, 1998, 7). Therefore, good value should cover the price angle (i.e. Travis Perkins should only seek to work with consumers who understand value and not consumers who only understand price) (Gordon, 1998, 23). To do this, Travis Perkins should create a character or a placeholder for the company as a whole. Also, the created personality should be written down for every employee to grasp and adhere to. The aim of this strategy is to create consistent and positive experiences instead of a bipolar business (Wind, Douglas, and Perlmutter, 1973, 17). However, creating a personality for employee-consumer interaction is not enough. Travis Perkins should document all special cases and indicate how its employees should act in such situations.

Staff branding

After establishing the companys personality among the employees, Travis Perkins can intensify its marketing by branding its staff (Bonoma, 1985, 2). Marketing the companys best staff members is key to gaining the trust of consumers. Today, consumers are more aware of their options in terms of product and service acquisition. As a result, people seek to hire experts for services, which they are willing to pay for. Therefore, to create a trustworthy image, Travis Perkins should have a branded expert on its team to guarantee the consumers that they can access someone they trust. In addition, Travis Perkins can take its best people to construction trade shows, set them up on professional social media platforms, and advertise them on company flyers. Apart from attracting potential clients, this strategy results in more job satisfaction among employees (Moorthy, 1993, 145).

Utilizing unique advertising opportunities

As regards to advertising, Travis Perkins should think outside the box because unique advertising opportunities are the gateway to new markets where Travis Perkins competitors might not be (Booms, and Bitner, 1981, 49). To provide for a successful advertising strategy, Travis Perkins can utilize the following ideas:

Taking out advertisements on local blogs. Unlike popular belief, local bloggers tend to be highly influential (Walker, Mullins, Boyd, and Larreche, 2005, 13). Hence, even if they do not seem to have any advertising options, it is nevertheless important to contact them and make inquisitions.

Sponsoring a small league football team is also one of the ways to Travis Perkins can market its business. Furthermore, this would help show that the company cares about its local community.

Running contests. It is evident that individuals like free things. Travis Perkins can engage its consumers by running contests for offers such as a kitchen makeover from where the company would collect the information of thousands of leads.

Networking

Then again, Travis Perkins should establish a network with its potential clients (Paley, 1999, 5). Research shows that networking is one of the best ways to market a business because it leads to referrals. However, the task may be difficult for companies venturing into new markets because their priority is running the business. To be able to manage the two without straying from objectivity, Travis Perkins should find appropriate networking events to avoid wasting time. There are a number of networking websites and social media platforms that have grown dominantly especially with the presence of digital technology. For example, Meetup.com is a website that allows companies to host events within the US (Grant, 1991, 117). This website also provides advice to construction companies about the best place and manner to set up networking events. For instance, the site finds that if a company does not wish to set up an event because it requires great commitment in terms of time, it can sponsor an event within a local town and use the opportunity to network and at the same time market its business (Meyerson, 2015, 112). If Travis Perkins cannot access a favorable networking site, it can set up a Facebook group and invite local and international businesses to join. This facilitates the creation of a digital networking group where allied businesses can engage each other.

Directories

Due to technology, todays consumer is able to carry out most of his/her transaction operations from the comfort of their homes (Carpenter, 1987, 211). Therefore, when a potential homeowner is trying to find a construction company online, they tend to surf around from one site to another. Most of the times, many customers tend to land on sites that are not websites of construction companies. The few times they are able to access construction sites, they do so through other directories that help them find local construction companies. To ensure that Travis Perkins has the best online presence, it needs to make sure it is present on these directories. Nonetheless, it is not necessary to be in every directory (Hauser, and Shugan, 2008, 95). However, as one of the leading construction companies, Travis Perkins should have adequate profiles on local and international directories. Examples of construction company directories include Brownbook, Builder central, and Thumbtack. To fully utilize the aim of these directories, Travis Perkins should fill out its profile with unique content, which should be helpful to potential clients (Nguyen, 1997, 240). Also, immedi...