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Company X, Inc. , Marketing Plan: “Service Level Agreements” Executive Summary Company X, Inc. , is a small locally owned organization that has been operating for almost 10 years now. The company employs only 14 people. Company X is a fixed wireless ISP (Internet Service Provider) that specializes in providing high-speed Internet access to rural areas of the San Joaquin Valley. The company also offers many other services the help it to generate more income such as network consulting, web hosting, co-location, point-to-point wireless solutions, and other Internet access services.
With competition high the company is in need of a competitive advantage that will help bring it to the urban market. The company’s current strengths over its competitors are not sufficient enough to gain a foothold in the urban market. Targeting urban businesses with a need for high, guaranteed speeds are the key to entering into this world dominated by AT. With new wireless equipment from a company called Wave IP, Company X can find its niche with SLA (Service Level Agreement) contracts. Environmental Analysis Before Company X existed its sister company, The Works Internet LLC. was running the show providing many of its current services except fixed wireless Internet. The Works owners Craig DeManty and Garrett Burbage joined forces with Peter Sorensen in 2003 to form Company X; the company is now absorbing The Works Internet completely and phasing out dial-up Internet. (Company X). This locally owned company holds the largest market share in fixed wireless broadband Internet and with a successful marketing plan they will become a major competitor with the urban giants Comcast and AT. Offering the consumer an Internet connection is nothing revolutionary.
The biggest competitors in California are AT, Comcast, Verizon, and Sprint. Sprint Broadband is our number one brand competition. They are offering wireless broadband connections to rural areas via microwaves with similar price structures. (Sprint). However, none of these companies offer realistic solutions, speeds, or Service Level Agreements. Rural areas where ATT and Comcast cannot reach leave Company X as the only company offering SLA’s. Realistically any company looking for an SLA agreement is interested in one thing, speed.
Verizon air cards and other Satellite providers can hardly provide speeds that exceed 300kbs download speeds. (Verizon). Comcast doesn’t offer SLA’s. (Comcast). ATT and Sprint offer minor SLA’s at poor speeds in urban areas and nothing in rural locations. ATT provides service through telephone lines by means of DSL or T1, Comcast offers service through coaxial cable, Sprint provides service through telephone lines and microwaves, and finally we offer services through telephone lines???T1, DSL, Dial up???and also through broad band microwave connections.
Company X operates in between Monopolistic competition and Oligopoly type markets. High speed Internet is a fairly recent technological movement that is sweeping across the world at amazing speeds and is certainly in the Prosperity stage of the business cycle. Comcast, AT, Sprint, and Verizon are all competing aggressively against each other and spending millions on advertising and promotion. (Suite101). With our current acquisition of licensed frequencies from the FCC the company has no foreseeable legal and regulatory forces that will halt operations.
Through technology Company X is able to introduce a new service to its customers, the SLA. Companies all over the San Joaquin valley are moving forward and embracing the technological trend, especially farms and dairies. Hardware and software is being developed for all organizations and demands a high-speed Internet connection. One example of the increase in technology being adopted by all organizations is security systems and cameras. Employers want to be able to monitor these cameras from anywhere in the world and this creates a need for a reliable and high speed Internet connection. Website Optimization). The importance of instant mass communication and ecommerce has created an enormous need for fast Internet among businesses and residential users. Many companies are seeing the potential of having employees and employers work from home at their office computer via a VPN (Virtual Private Network). These VPN’s require a very low latent, high-speed connection that is stable and well supported. Company X fills this need exceptionally and with the introduction of SLA’s business owners can have peace of mind that their connection will always be up and running.
T1 lines offer dedicated Internet speeds at high prices. They offer only 1. 5Mbp up and down stream while Company X can provide 3. 0Mbp up and down stream at the same price. (AT). SWOT Analysis Company X has such a vast array of strengths it is hard to even compare it to its competitors. The company offers product differentiation by operating locally, not outsourcing technical support through India, offering unlimited bandwidth, free service, and other convenience services that help to develop long lasting relationships with our clients.
Company X has unmatched customer service that originates from a small office environment and owners who strongly believe the customer IS always right. Personal relationships are developed with all customers who call in for support and it is these satisfied customers that give us a marketing edge and free advertisement by word-of-mouth. Unwired’s employees have all had long lasting relationships and commitments to the company and its owners which helps to create a positive growth and synergistic environment.
The companies small size and lassie faire atmosphere blesses its’ employees with unparalleled freedom that harvests a plethora of new ideas and shatters the barriers of paradigm thinking. Again due to the companies’ small size all the employees have extensive amounts of training and cross training. This vast knowledge base helps to enhance our customer contacts. Unwired also offers customer service in a supplementary way that sets them apart from the competition.
One of the organizations weaknesses is lack of name identification, high prices, service unavailability in rural and urban areas, direct line of sight issues, conflicting radio frequencies running on similar channels and environmental factors such as high heat, wind and other extreme weather conditions. It’s small organizational size works as a double-edged sword and also serves as a disadvantage. Employees can quickly become overloaded with work and distractions that impede creativity and threaten synergy. Too few employees performing too many tasks create bottlenecks throughout the organization.
Another weakness that results from our small size is a lack of customer service during the weekends and off hours. Our tech support is only open Monday ??? Friday, 7:00 AM to 7:00 PM. When compared with other locally owned ISP’s this operation time is acceptable and the norm, but as we try to gain market share from the national companies we suffer the weaknesses of smaller size and availability. Internal growth in the company is almost impossible and will remain that way until more of office space is available. Thousands of computers are being sold every day to business and residential consumers. Computer Industry Almanac). Web related content such as sharing videos and music are quickly becoming the norm among Internet users. As technology and ease of technology grows more and more users need high-speed Internet connections. (FCC). What slow dial-up internet connections you could get by with in the past are no longer an option for even simple web browsing due to the increase in intense graphical and text based websites that require minimum speeds to even view. Through a little internal growth of only two employees Company X can increase their customer service hours and quality.
Through intense cross training and “how to” documentation new employees can develop the hybrid skills that are a requirement at Company X. Name identification can be resolved by supporting a community project, advertising (flyers), and cold calls. High prices can be cut back via promotional pricing in new rural and urban areas to flush out local competition. Increasing serviceable areas has a simple solution; sprout forth more towers to connect future clients. Obtaining licensed frequencies from the FCC is currently phasing out conflicting radio frequencies.
The only weakness Company X cannot control or convert is the San Joaquin Valleys climate; Mother Nature. Marketing Objectives The focus of Company X is to increase its market share of Internet contracts to business clients. The company should increase market share from both the local and national competition. Company X has always proved successful with the rural business target market. They are exceptionally well known through out the agriculture industry as an extremely fast and reliable Internet provider. However, the company seeks the new urban business target market.
This new service will be targeting small to large businesses that demand high speed internet to run both business operations and Voice Over IP (VOIP) telephone lines. Company X will enter this market with Service Level Agreements that guarantee the client a given speed at a given latency with a guaranteed time frame for resolving outages. Unwired’s first objective will be to analyze its current competitors in the Fresno and Clovis areas. Company X will analyze the competitions pricing, speeds, customer service, and additional services.
This research will be performed by sales, level one support, and level two support. Research will begin November 19 and should be finished and reported to Craig DeManty November 21. The information will be compiled and competition-based pricing and nonprice competition based pricing will be used to determine the final price. The final price will be confirmed November 26th. The second objective of Company X will be to prepare itself for the release of its newest service. The entire Fresno/Clovis city and county will be the target market.
The company, which has already acquired new license frequencies and tested new manageable wireless equipment, will install this equipment on its Fresno/Clovis towers: Bear Mountain, Owens Mountain, River Park, and Fresno Pacific Security building. All hardware will begin configuration on December 3, 2007. The configuration will be completed by December 7th and installed on all four locations by December 21, 2007. Company X’s third objective will be to advertise this new service in the Fresno and Clovis area. The company will launch its advertising campaigns through multiple Medias.
The first will be a Television commercial that emphasizes competitive advertising to set the company apart from the rest of its competition. Using a database of all businesses operating in Fresno and Clovis the sales associates will be prospecting future clients. Utilizing this same database the company will send out flyers to all businesses and all flyers will include a cents-off offer. Prospecting the new areas will being January 1, 2008 and continue until 2009. The commercial will air January 10th ??? March 10th and again May 10th ??? August 31st. Target Market
Company X’s current target market consists of middle to upper class residential homeowners in rural areas and counties along with locally owned small to medium sized businesses employing generally no more than 125 people. The proposed marketing plan will not be aimed toward any residential clients. The companies target market will be on medium to large sized businesses operating in the Fresno/Clovis areas. The companies’ aim will be to move future business clients off the quickly outdating T1 lines and onto solid fixed wireless connections and VOIP phones.
The company will be entering a heterogeneous market where different businesses require different Internet speeds. Unwired will seek a concentrated marketing strategy by focusing on a single market segment and using one marketing mix. The marketing plan will call for use of the following segmentation variables: Geographic and Behavioristic. From geographic the company will seek urban cities with a city size of at least 250,000 and aim for market density. From behavioristic the company will focus on brand loyalty, end use, and benefit expectations.
Product, Price, Distribution, & Promotion Mix Product Service Level Contracts will appeal to the needs of businesses running VOIP phones, self managed servers and mail, high end routing equipment, and security camera systems. Customers will be able to choose from a flexible price range that will best suite their needs and budget. Assuming the client has a clear Line of Sight (LOS) with one of our four Access Points they will be able to receive a range of high-speed SLA connections.
As an added bonus to all customers, Company X offers burstable bandwidth speeds. This additional bandwidth is above and beyond the Committed Information Rate for the service and is provided on a best effort basis only. Burstable bandwidth is provided only when excess network capacity exists. The SLA will guarantee the client a 99. 9% system up time, 1% packet loss, and less than 100ms (millisecond) network latency round trip. Unwired provides 100% committed information rates (CIR) on its Enterprise Class Services.
Each Enterprise Class Service will be configured and provisioned to operate to the full CIR specified for the product. The Unwired Network is engineered to ensure that even during peak network load, the service will be capable of transmitting or receiving network traffic (IP packets including data and packet overhead) within a 10% maximum variance of the CIR as averaged over a calendar month. Throughput is measured as the average of 5 samples of an FTP file transfer (1 MB minimum file size) taken directly from the Unwired Interface (not within the customer LAN) to the Test Server.
In the event of a problem with the service resulting in Network Unavailability, the company will make its best commercially reasonable efforts to repair the service to working condition within 5 hours of the outage being reported and a trouble ticket opened. Price The pricing of this service is competitive to relative competition, such as T1 lines which commit a dedicated bandwidth rate of 1. 5Mbps at $349 a month. The company will use odd pricing to further compete with other ISPs. Pricing will begin with a mandatory installation fee of $399 and customizable monthly rates dependent on the speeds desired.
Pricing per connection will be as follows: (minimum) 1Mbps at $199, 2Mbps at $299 [this already beats the competing T1 pricing and speed], 3Mbps at $399, 4Mbps at $499, 5Mbps at $599, and finally an amazing 6Mbps at $699. Distribution (1pg) Company X does not have to react to distribution because it is supplying a service and not a good. This service comes directly from the company to the end user with no middleman. If the company were to focus on market coverage it would be exclusive distribution. Promotion (1pg)
As already mentioned, Company X will promote this service through multiple Medias such as prospecting, flyers with cent-off offers, television and of course community service projects. Company X will utilize all four elements of the promotion mix with an emphasis on personal selling. The company will follow a pull channel policy because it is promoting its service directly to the consumer. The company will advertise television commercials on local stations only during the hours of 6pm ??? 11pm, (when most business owners are at home watching the news).
To the organizations current customers the company will be sending out mass emails regarding our new services. Company X is in the process of developing a new more modernized website that will be searchable on all engines such as Google. Lastly, the company will be blanketing zip codes with flyers one by one throughout Fresno city and then repeat this process again. By becoming involved in community service projects the company will also have a public relations focus and can hope for some form of publicity through the news media.
Internally, the company will offer sales promotions to its current sales staff by offering higher monthly commissions and $100 spiffs on all connections installed on a $599 installation fee. Sales associates will be given the flexibility of offering customers lower monthly rates with longer contracting terms. For example, the average connection of 2Mbps for $199/mo is on a one-year contract. The salesmen can offer the customer the same connection for $169/mo on a two-year contract and $149/mo on a three-year. External promotions will include flyer discounts and special installation fees.
In the beginning of the marketing campaign free installation on all two-year contracts will help the company to gain more market share. Buzz marketing has been huge in the past with Company X’s expansion. Word of mouth is essential to the organizations growth and is encouraged through all employs to the customer. Every employee in direct contact with customers will be trained to encourage word of mouth and ask if they would like a flyer or pricing sheet to hand out to friends. In an attempt to gain more word of mouth every customer will be given one-month free service per successful referral.
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