Wileyfox UK launches new smart phone for the savvy open market

BUSINESS PROPOSAL FOR THE MARKETING DIRECTOR OF WILEYFOX, U.K.

  1. INTRODUCTION

Wileyfox is a London-based company which deals on high-value, affordable and low-choice mobile phones, including phone-specific screen protectors, clip-on covers and spare batteries. It was established in 2015 (John., 2018).

Wileyfox operates with few workers and has no legacy devices to compete against market leaders such as Apple and Samsung. To effectively differentiate its products, the British phone maker recently announced hardware commoditization as a strategic roadmap to achieving competitive advantage against Android or iOS-reliant rivals (Woods., 2015).

Mike Coombes holds position as Wileyfox CEO and has experience as a former sales executive at Nokia and HTC (O’Reilly., 2013).

Figure 1: Wileyfox Phones

Source: Wileyfox (2019)

  • EXECUTIVE SUMMARY

On 6 February, 2018, Wileyfox went declared bankruptcy and publicized on 19 March that Santok Group has acquired license to sell its phones in South Africa and Europe. However, as a struggling new entrant in the overcrowded and advanced global markets, Wileyfox aims at maximizing profit potentials by introducing unique multifunctional handsets that guarantee consumer satisfaction through durability, long battery life, user privacy and 3D viewing (Brown., 2018).

The new product will be available worldwide within 2 years after its launch in April 2019. This brief marketing proposal is a sample prepared ahead of the product launch.

  • SITUATION ANALYSIS

Considering its efficient assembly procedures, design skills, cost control, and adaptability to changing market demands, Wileyfox can achieve competitiveness and sustainable growth if management adopts push and pull strategies in its value chain. But the undercapitalized phone maker is liquidating assets and are yet to pay of their debts—an indication of its inability to sustain long-term business. In addition, its Swift and Storm device owners are doubtful of the company’s existence and growth considering that their previous operating system Cyanogen (an Android variant) was problematic. According to Woods (2015), consumers are expecting huge investments in research and development (R&D).

Figure 1: The U.K. phone market

Source: Statistica (2019)

As shown in Figure 1, Wileyfox maintains an insignificant percentage of the U.K. phone market. Thus, its marketing priorities are:

  • To expand customer base through strategic advertising
  • To build solid business relationships with telecom operators
  • To generate sales and achieve incremental profit after 12 months
  • To invest in corporate social responsibility
  • To respect consumer protection laws and
  • To conduct business with an environmentally-friendly approach.
  • MARKET NEEDS AND TRENDS

The fictional smartphone, Blaze 3D Plus, has an innovative, thin and user-friendly design, with a biometric security system, long-lasting solar battery, and an eco-friendly source of power that offers at least 12 hours of talk-time. It comes with a 2-year warranty, which highlights Wileyfox’s focus on quality, affordability and consumer satisfaction. Additionally, the new phone will be usable with any telecom carrier—on pre-paid plans. It will offer larger, durable touchscreen, drop-proof quality, free-calling online services, call recording capability, 15-megapixel camera, among other functions and benefits that outclass competitors.

Table 1: Features and Benefits of Blaze 3D Plus

Source: The Author (2019)

  • TARGETED SEGMENTS

As shown in Table 1, the cost-efficient Blaze 3D Plus will provide convenience for travellers, with added entertainment programs for all customers. The primary target segment (Wedel., 2000) comprises of middle and upper-income customers(professionals) who don’t have charging time and therefore prefer long-lasting batteries for uninterrupted usage. This group also includes people whose annual income is above $80,000.

Secondary targets are young adults aged between 18 – 30 years old, who can afford new, appealing gadgets—especially phones with alternative energy sources and unique features that can be traded for newer models at little costs.

  • MARKET GROWTH

Market trends between 2014 – 2018 show significant increase in smartphone sales, and users are shifting from traditional handsets, which offer limited features, to iOS and Android-powered cell phones with virtual keyboards and touchscreen interface. Table 2 shows total shipment volume of 1,204.4 million and 1,738.5 million in 2014 and 2018 respectively. The 11.5% increase is a proof of the unlimited opportunities in global smartphone markets, which Wileyfox should maximize with its launch of Blaze 3D Plus.

Table 2: Global Smartphone Sales & Market Share (2014-18)

Source: IDC Worldwide Mobile Phone Tracker (2019)

*Units in Millions

Figure 2: Global Market Share of Smart-Connected Devices (2013-18)

Source: IDC Worldwide Mobile Phone Tracker (2019)

  • SWOT ANALYSIS

Wileyfox has to build on its strengths with the launch of Blaze 3D Plus. Product differentiation, as highlighted in Table 1, will certainly provide differential advantage and build positive brand image for the company.

However, major challenges include poor visibility in global markets, lack of investment capital, limited distribution networks etc. Until Blaze 3D Plus is thoroughly tested and found to be safe and compatible with telecom networks, Wileyfox cannot expect a favourable competition (Burrnett., 2007).

Table 3: SWOT Analysis of Wileyfox

Source: The Author (2019)

  • COMPETITION

Samsung, Huawei and Apple present Wileyfox with its greatest challenges. Others in the highly competitive smartphone market are Chinese brands—Xiaomi and OPPO (Reith & Chau., 2018). Wileyfox should therefore adopt the “bring-your-own-gadgets” at work to prove their credibility, show compliance to corporate policies that protect consumer rights, and increase sales. However, most first-time smartphone buyers may not choose Blaze 3D Plus because of its sophistication.

  • PRE-LAUNCH PHASE

Introducing new profitable products in the highly-competitive smartphone industry comes with opportunities and stress-prone planning activities for the launch team, especially in the pre-launch phase where cutting corners or ignoring something can jeopardize realization of business objectives. For example, there should be a comprehensive list of activities with names/groups attached to departments and responsibilities, including links for inter-departmental functioning and external support.

The product development and product launch phase are crucial for goals attainment and sustainability. Wileyfox Corporate Executive Board should therefore take cognizance of these 3 major challenges: product planning; communications (internal); and uniform implementation of product launch objectives by employees in marketing, sales, engineering, customer support and supply chain.

Product Launch Plan: This stage requires a strategic and comprehensive product development idea, which must be separate and segmented into:

  1. Initial planning, ii. Pre-launch activities, iii. Sales and channel launch preparedness, iv. Launch date, v. Post-launch supervision.

Initial planning should take between 3-6 months before the product launch date, and the key objectives should be to:

  • Increase sales volume from existing customers
  • Discover new markets
  • Maximize use of new technology

Pre-launch activities should take about 3 months before the product launch date, with key activities focused on: developing a timeline that indicates topics, themes, deliverables and timing, including appropriate marketing channels for promoting the launch (email, intranet, screensavers, newsletters, corporate blog, face-to-face meetings etc); creating reference terminology for the new product; formulating creative visual aspects of branding for the product; planning strategic marketing activities and key launch events; finalizing pricing and distribution channels; organizing sales training activities/materials and sales collateral; and using print/media advertising etc to create pre-launch awareness.

Sales and channel launch preparedness should take about 1 month ahead of launch date. It requires training/advising of the launch team on key activities/events, roles and responsibilities; availability of sales tools/collateral; explaining the process; and offering support.

On the launch date, the company’s planning and preparedness are tested from press releases to live media update on the public unveiling usually held at a trade centre. After this, the new products go on sale while business managers monitor market trends for performance and policy adjustments—where necessary. Two-way communication should be encouraged and, importantly, negative comments should be embraced.

Pre-launch marketing Objectives

  1. Increase brand awareness among targeted segments by 50%
  2. Build strong relationships with distributors, retailers and telecom carriers within 100 days
  3. Earn the British government’s recognition for power efficiency before launch
  4. Advertise the benefits of solar-powered battery
  5. Invest in relationship-building activities with host communities, NGOs and charity organizations.

Steps to launching a new product:

  1.  POST-LAUNCH PHASE

According to a 2012 Babson College survey, only about 65% firms attain profitability in their product launch, and nearly 15% of businesses fail due to non-use of quantifiable performance measures until post-launch. These results highlight the importance of planning, strategy, and continuous market assessment even when sales are increasing. In the first 12 months after launching Blaze 3D Plus, Wileyfox management should answer these questions:

  • Did the product launch survive development, manufacturing, administrative and financial setbacks?
  • Was the timing right?
  • How did the target market respond?
  • How did the sales team perform in terms of feedback, use of promotional literature, training materials, and marketing tools, including feedback from customers?
  • Were the customer support channels established before product launch?

Post-launch Marketing Objectives

  1. Achieve unit sales volume of 240,000 within first 12 months
  2. Increase brand awareness across business areas by 20% within 12 months
  3. Restrict losses to less than $1 million
  4. Surpass the break-even mark within 12 months
  5. Achieve at least 10% annual ROI within 12 months
  6. Recycle over 40% of phone parts after life span/warranty period.
  1.  MARKETING MIX

Wileyfox can achieve its goals through effective marketing mix decisions such as:

Product: Differentiating Blaze 3D Plus with features that are inimitable.

Price: Offering low prices, discounts and flexible payment options to selected segments/markets. Average retail and wholesale prices should be $150 and $135 respectively.

Promotion: Using promotional activities (e.g. print/media advertising and sponsorship of sports, educational, entrepreneurship or social events.

Place: Discovering new markets and maximizing distribution channels to ensure a balance between demand and supply.

Table 4: Financials/Forecasts

Source: The Author (2019)

Table 5: Proposed Marketing Activities

Source: The Author (2019)

Depending on the impact of these marketing activities on financials, there may be need for revision and adjustment to protect market share and maintain sustainable growth.

  1.  RECOMMENDATION

Although business is about experimenting, learning and adjusting; to avoid risks from losing market share to contenders, Wileyfox should form mergers and use a strong PR while its affiliate, Santok Group, maximizes local distribution channels in Europe, Asia and other continents where brand presence is currently insignificant.

REFERENCES

Brown S., 2018, “UK phone maker Wileyfox enters bankruptcy,” AndroidAuthority, accessed 26.01.2019, < https://www.androidauthority.com/wileyfox-enters-administration-bankruptcy-835948/>

Burrnett J., 2007, “Product Differentiation,” John Wiley & Sons Inc., New Jersey, accessed 28.01.2019

John M., 2018, “Wileyfox is back: New handsets arriving this year and more good news for owners,” TechRadar, viewed 26.01.2019, < https://www.techradar.com/news/wileyfox-is-back-new-handsets-arriving-this-year-and-more-good-news-for-owners>

O’Reilly L., 2013, HTC UK in turmoil following senior exits,” MarketingWeek, retrieved 27.01.2019, < https://www.marketingweek.com/2013/03/11/htc-uk-in-turmoil-following-senior-exits/>

Reith R. & Chau M., 2018, “Smartphone Market Share,” IDC, retrieved 28.01.2019

Wedel M., “Historical Development of the Market Segmentation Concept.” pp. 3-5, Norwell, USA: Kluwer Academic Publisher, retrieved 28.01.2019

Woods B., 2015, “Wileyfox launches its first Cyanogen OS smartphones, the 5’’ Swift and 5.5’’ Storm,” TheNextWeb, accessed 27.01.2019