Marketing Plan (f1 -karting) 1x1m3n

Saket Adhikari ([email protected])

CHAPTER ONE INTRODUCTION Executive Summary

The following marketing plan had been developed by MBA Marketing group of F1 – Karting to obtain RM 300,000 in capital for the marketing of F1 – Karting racing facility. This plan will serve the first three years of the venture’s operation. The F1 – Karting will focus on serving walk – in customers and corporate and event clients through racing sessions and facility rentals, but also will serve smaller niches with adult racing leagues and youth camps. Walk – in business will be generated through local people, trade shows attendees, conventioneers, and tourists/ visitors of the city. Corporate events will be sold to business establishment and organization with Malaysia and Asia pacific (ASEAN) and leagues will be geared towards repeated customers of the facility. Youth camps will also be available to children’s. The grand opening of the F1 – Karting is scheduled on January 1st, 2011. The center will be located at Cyberjaya, Malaysia. F1 – Karting faces direct competition from mostly three karting centers in the Malaysia market. At F1 – Karting customers will have the option of alternative forms of entertainment through the use of a full arcade, retail novelty shop, concession stand, and safe viewing and television entertainment. Additionally, the F1 – Karting will features Malaysia’s longest and widest kart racing track allowing for safer racing conditions. The track will enhance customer enjoyment of road racing experiment and also offering the newly designed F1 kart that will allow the facility to increase the market size by offering new racing programs to more age categories. Finally, all financial projection for the F1 – Karting show the potential success and growth in the exiting market.

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CHAPTER TWO 2.0 Situational Analysis F1 – Karting is beginning its first year of operation and recognizes that the marketing activities are critical to success and there is a profitability of the business. This recreational center offers customers with an exciting rush of high – speed go karts. It will also offer a wide array of racing opportunities, ranging from the arrive and drive format, facility rentals, leagues, camps and other racing. In additional to racing there will be conference rooms, arcade games, snack bar and a retail shop.

2.1 Market Summary We live in a society that revolves around entertainment. People are looking for things to do and new places to experience. Entertainment industry thrives on the disposable personal income of consumers for the success of their come place of many big events. Experience F1- Karting is located at Cyberjaya, a new planned township with a science part as the core that forms a key part of Multimedia Super Corridor. Located within excellent amenities and infrastructure, F1 – karting see the potential customer engagement in addition to the universities potential of being the place of many big events and entertainment shows.

2.1.1Target Market By using the data gathered through primary research and studying the current scenario, we identified two primary markets that will be targeted as well as several secondary markets to help boost revenue. As the trend in this industry is that the majority of the sales come from special events. The second primary market to be targeted, walk – in racers consists of such as local people, tourist, trade show / convention attendants. Walk in customers represents a wide array of 2 MBA 502 Marketing Management

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ages and demographic. Therefore, in this marketing plan we will address the interests of broad category of people.

Secondary markets will be made of community and national business chains, for the purpose of advertising packages within the facility. Also in this category would be children group from 10 – 17 for the youth kart racing camps, any individual above 18 years of age older will participate in weekly kart racing leagues.

2.2. Market Demography The profile for the typical F1 – Go – karts customers consists of the following geographical, demographic, and behavior factors:

GEOGRAPHICS F1 – Karting has set Cyberjaya – the IT city of Malaysia to host sporting events and convention on an annual basis. An estimate of over 1 to 2 million visitors will visit Cyberjaya, bringing almost 5 billion ringgit in revenue. Incoming visitors range from individual from conferences and religious conferences to participation in sporting events. Additionally cyberjaya has been able to launch an initiative to attracted MNC’s, Local as well as foreign universities to the area.

DEMOGRAPHICS From the survey we found out that F1 – Go – Karts concept appeals to a broad demographic through evenly spread percentages in the categories of age, education, and income.

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A majority of the walk – in markets for karting consists of people between the ages of 18 and 34 at a total of 40 percentages. However, a good percentage of customers aged 35 and older also participate in these activities.

There is an even spread in the household income Go - Kart participants. The top brackets was a RM 50,000 to RM 74, 999 income making up 22 percent of the market, followed by a vastly different RM 10,000 to RM20, 000 to RM 29, 999 at 16 percent. The other six categories all fell within 4 percent of each other.

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BEHAVIOR FACTORS This F1 – Go – Karts focuses on providing consumers with an exhilarating rush of adrenaline and excitement. Consumers are willing to spend more money to experience the F1. These consumers have active lifestyle that includes some sort of recreation at least two or three times a week.

2.3 Market Needs

The F1 – Karting is providing customers with a wide selection of entertainment activities. All of these activities incorporate the newest technological advancement. F1 –Karting seeks to fulfill the following benefits that are important to their customers: •

Convenience – Location, ease of use

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Wide range of Selection – Wide options of products and services 5 MBA 502 Marketing Management

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Customer Service – Full attention provided

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Price – Competitive

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Utilization of advanced technologies

2.4 Market Trends Today market trends revolve around entertainment. Consumers are always looking for things to do and new places for the experience. Entertainment business thrives on the disposable personal income of consumers. Through the basic concept of karting has been in existence for some time but very little available information is available as to the current market trends. Recently karting has been experiencing its popularity since 1194 when Micheal Schumacher became the world champion in the Formula One Series for the first time. 2.5 Market Growth As the population ages, the potential market also increases. The F1 – Karting has a good marketing program and will provide an excellent service to increase their customer base. Karting has seen an explosion of centers across USA and Europe, the industry is still very new and has huge potential for growth here in Asia especially Malaysia. There are chances that price for karting going down due to competition by many karting centers throughout Malaysia. However, one of the biggest problems is that no organizations have successfully formed to aide in the development and future of the industry.

2.6 SWOT ANALYSIS The following SWOT analysis captures the key strength and weakness within the company, and describes the opportunity and threat facing F1 – Karting.

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2.6.1 Strengths •

In – depth industry experience and insight

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Creative, yet practical designers from Formula One

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The use of a highly competent, flexible business model utilizing direct customer sales and distribution

2.6.2 Weaknesses •

The reliance on outside capital necessary to grow the business

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The lack of retailers who can work face – to – face with the customers to generate brand and product awareness.

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The difficult of developing brand awareness as a start up business

2.6.3 Opportunities •

Participation within a growing industry

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The ability to leverage other industry participations marketing efforts to help grow the market

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Product development

2.6.4 Threats •

Future / potential competition from already established market participation

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A slump in the economy that could have a negative effect on consumer spending on recreation events 7 MBA 502 Marketing Management

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The release of study that question the safety of racers or the inability to prevent major traumas

2.7 Competition Competition in the karting business in Malaysia is still mild and will play a role in F1 – Karting success. There are three good karting centers within Malaysia and none of these incumbent establishment have either the technology or the wide range of service provided by F1 – karting center. There are few companies that are making their presences. •

Sepang International Circuit, Sepang, Malaysia

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Extreme Part @ Sunway Malaysia

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City Karting enterprises, Shah Alam

2.8 Product and service Offering The F1 – Go – Karts is primarily a service facility, with the main focus on providing customers with the racing experience. The following list of products and services are: • Arrive and Drive Racing •

Corporate Outings

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Concessions

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League Racing

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Retail Novelty Shop

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Youth Kart Racing Camps

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Advertising Packages

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Safe viewing Areas and Television Entertainment

2.9 Keys to success The keys to success are designed and producing products and services that meet market demand. F1 – Kating has three key to success: •

Location – The center will be strategically located to maximize the profit from the modern go – kart racing. The center will be constructed on Cyberjaya, Lake side to total customer satisfaction ie., the experience of a wide arrays of entertainment activities from a full arcade to snack shop, retail store featuring items from the top racing circuits and several areas to relax and watch televisions.

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Low overhead cost – Although F1 is an expensive sport, F1 – karting management will keep overhead cost at a minimum. The construction will be done by Protesco Bhd the subsidy company of F1 – Karting saving approximately 30% of the construction costs.

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Wide range of products and services – F1 – Karting will also provide entertainment, not only racing but also having a full restaurant / corporate outings / night clubs, arcades, snack bar, apparel shop etc. this diversity will bring more customers and provide them more ways to enjoy themselves and spend their disposable income.

2.10 Critical Issues As a start up business, F1 – Go – Kart is still in the early stages, the critical issues are: •

Establishing itself as the premier Go – Kart racing company.

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Pursue controlled growth that dictates that expenses will never exceed the revenue. This will help protect against recession.

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Inaccurate Sales projection

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Constantly monitoring customer satisfaction, ensuring the growth strategy will never compromise service and satisfaction.

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Injuries to visitors

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CHAPTER THREE

3.0 Marketing Strategy The key to the marketing strategy facing F1 – Karting is to identify its potential long – run opportunities given its market experience and core competences. The set of tasks necessary for F1 – Karting is to come out with marketing strategies and plan , connecting with customers, building strong brands, shaping the market offerings, delivering and communicating values, capturing marketing insights and performance, and creating successful long – term growth.

A full time Marketing manager will be a vital part of the F1 – Karting management team. Marketing managers will be responsible for the assuring customer satisfaction, generating public awareness of the type of entertainment offers at the center.

3.1 Purposed Mission F1 – Go – Karting mission is to provide the customers with the F1 experience go – karting that provides customers with racing experiences. We exist to attract to attract and maintain customers with range of products and services.

3.2 Marketing Objectives •

Host sporting events and conventions to generate over billion dollars on an annual basis

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Maintain positive, strong growth each quarter

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Development of new market and accelerate product and service development to meet customers’ needs and work together effectively as one team 11 MBA 502 Marketing Management

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3.3 Financial Objectives •

Increase the profit margin by 1 percent per quarters

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Maintain a significant research and development budget spur future product development.

3.4 Target Markets We live in a society that revolves around entertainment. People are looking for things to do and new places to experience and karting is one of such new experience. With a world karting growing steadily, the niche for this sport has been created. The aim of this is to expand this market by promoting Go – Karting by providing them the F1 experience as well as giving an option of alternative forms of entertainment through the use of a full arcade, retail novelty shop, concession stands, and safe viewing and television entertainment. Our products are targeting the potential racers and the recreational groups, because they are the fast growing. Moreover entertainment business thrives on the disposable personal incomes of consumers.

There is very limited information available on the number and demographic on cart racing. In kart racing, approximately 96% of participants are male with 48% being between the ages of 22 and 35. While males are the predominant karts racers, female also are enjoying kert racing. New target market can be created on business and corporations as they can use these facilities for their outings and events.

3.5 Positioning

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F1 – Go – Karting will position itself as the premier karting company. This positioning will be achieved by leveraging F1 – Karting competitive edge: industry experience and ion. We are confident that the new facility will be prosperous and become the premier karting center in the state. The company will look to acquire a share of the existing market as well as increase market size by offering unique programs to new age groups.

3.6 Strategies The objectives are to position F1 – Go – Karting as the premier karting company. The marketing strategy will seek to first create customers awareness concerning the offered products and services and then develop the customers’ base. The main strength is to give customers the F1 Experience that will lie in the highly differentiated approach of the facility. This experience will offer entertainment for the whole family by offering racing camps for childrens which will lead to interest from parents and their participants in the sports. The facility will encourage its customers to gain an interest in other motor sports, and will allow them convenient shopping for apparel of their favorite drivers in the retail shop.

The other marketing approach will be ment placed in numerous industry magazines. The automobile industry is ed by several different glossy magazines designed to promote the industry as a whole. We are confident that our karting with the F1 experience will appeal to the local people and visiting tourists and will capture a significant portion of the current market as well as increase the market size. We are determined to make F1 – go – Karting Malaysia’s premiere facility for karting.

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3.7 Marketing Mix F1 – go – karting marketing mix compromises the following approaches to pricing, distribution, ment and promotion and customer service

3.7.1 Pricing The F1 Experience will utilize pricing that will consistent with the other facilities in the market. Each walk – in racing session will cost the consumer RM100 for a 25 lap session. In addition to racing they will receive he use of one head sock, driving suit, helmet. They will receive a computer generated statistical read – out of their performance after each session.

Corporate outing and special events will be priced on an individual basis, depending on the total packages that the company or group is seeking. Youth kart racing camps and adult kart racing leagues will be attractive to customers as they allow more time behind the wheel for a lower cost. Youth camp will be priced at RM 25 per entry and adult racing league will have entry fee of RM 40 per entry.

Retail clothing merchandise will be priced at the manufacturer’s suggested retail price, and snacks foods and drinks will be priced slightly above these suggested prices. Even at this higher mark – up, costs will be lover that of other facilities.

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3.7.2 Place Malaysia hosts hundreds of sporting events and conventions which generate over a billion ringgit for the country on annual basis. Each year, an estimated 5 million visitors visit Malaysia bringing about 5 billion ringgit in revenue. Malaysia chose to use sports as an economic and community tool, and backed the construction of sports facilities and marketing strategies to attract top sporting events. The F1 – go- kart will be located in cyberjaya and is less than half an drive from Kuala lampur. Cyberjaya is Malaysia fastest growing town because of the presence of Multinational companies as well as Universities.

3.7.3. Promotion and ment We will use a variety of promotional avenues to gain more interest from the community and ensure that they will continue to use the F1 – Go – Karting experience for their racing apparel needs. Promotions to be used are as follows: •

Free Tee Shirts

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Newsletter

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Press Releases

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Awards

We will have to carefully develop an advertising campaign to promote the F1 – Go – Kart xperience, as a majority of the customers are obtained through the word – of – mouth. The F1 experience as construction gets under way, and will heavily promote the unique features of the facility. The following advertising methods will be used to spread the word of the new facility and increase the public knowledge of this form of entertainment. •

Phone Book (Yellow Page)

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Flyers

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Newspapers 15 MBA 502 Marketing Management

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Corporate magazines

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Radio

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Television

3.7.4 Consumer service

F1 – Karting will provide service to its customer before, during and after the purchase. It will be a series of activities designed to enhance the level of customer satisfaction. F1 – Karting philosophy is that whatever needs to be done to make the customer happy must occur, even at the expense of short – term profit. In the long term, this investment will pay off with a fiercely loyal customers base that is extremely vocal to their friends with referrals.

3.8 Marketing Research

F1 – Go – Kart tested its products not only with its principles, who are accomplished racers but also with the many dedicated and new s. The existence product testing by wide variety of s provided F1 – Karting with valuable product and has led to the market strategy. Online rating system and competitive analysis are some of the marketing research services. 16 MBA 502 Marketing Management

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CHAPTER 4

4.0 Controls The purpose of F1 – Karting marketing plan is to serve as a guide for the organization. The following areas will be monitored to gauge performance: •

Revenue: Monthly and annual

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Expenses: Monthly and annual

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Customer satisfaction

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New Product Development

4.1 Implication The following milestone identifies the key marketing program. It is important to accomplish each one on time and on budget. Table: Milestones MILESTONE

PLAN

Milestone Marketing Plan Completion Web site Completion ment Campaign Promotional Campaign Development of retail

Start Date 1/01/10 15/02/10 15/02/10 1/06/10 1/01/10

End Date 1/02/10 14/3/10 14/10/10 1/09/10 1/109/10

Budget RM 0 RM 25,000 RM 8,000 RM 10,000 RM 0

Channel TOTAL

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RM 42,000

Manager Saket Outside Anas Bashir Hussain

Department Marketing Marketing Marketing Marketing Marketing

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4.2 Contingency Planning

Difficulties and risks: •

Over-estimating demand.

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Problems generating visibility.

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Mistaken assumptions regarding the future development of the business area.

Worst case risks may include: •

Determining that the business cannot itself on an ongoing basis.

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Having to liquidate equipment to cover liabilities.

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References

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Kotler, et al. (2009), Marketing Management: An Asian Perspective, 5th edition. Singapore: Prentice Hall.

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Peter, J. P. and Donnelly J. H. Jr. (2008), Marketing Management: Knowledge and Skills, 9th edition. Boston: McGraw-Hill.

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Aaker, D. A., (2008) Strategic Marketing Management, 8th edition. Hoboken, N.J.: John Wiley & Sons

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Sarah Sturmon Dale, “Go – Karting for Executives,” Times (July 30, 2001)

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Andrw M. Whisler, “The F1 experience”, Entrepreneur, Singapore: Prentice Hall

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“The History of Indor Karting,” http: //www.karting.co.nz/indoorgrandprix/historykart/

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“Amusement technology Management,” http:// www.e-kmi.com

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“indy Motorforce, “The Indy Partnership, http://www.indypartnership.com

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