Business 1220 Marketing Report - Gracie Barra.docx

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Western University
Business Administration
Business Administration 1220E
Sean Burkett

Gracie Barra London Marketing Management Report Name: Anna Li Date: December 5, 2012 Instructor: Sean Burkett Section: 003 2 Executive Summary Gracie Barra London (GBL) is a Brazilian Jiu-Jitsu (BJJ) gym in London owned and operated by Fateh Belkalem. It is part of the Gracie Barra franchise, originally founded by Carlos Grace Jr. in Brazil in 1986. Gracie Barra is one of the most well-known and respected Brazilian Jiu-Jitsu franchises in the world. This year, Belkalem has decided to work at GBL full time and has proposed a new goal. His objective is to increase the gym’s enrolment by 40% in the next year, raise customer awareness of GBL and what they have to offer, and utilize $11,000 for marketing initiatives and/or gym expansion. From the analysis and calculations provided in this report, the following recommendations are the most effective and financially feasible for the company: o Gym expansion should proceed so that they can offer more services o Advertisements should reflect GBL’s experience and dedication to BJJ and their specialization to the art o A variety of classes should be offered such as self-defence, competitive training, female and anti-bullying for children, etc. o Target market should be focused on women o Facebook, Twitter, London Transit Commission bus ads and Western Gazette ads are useful ways to advertise to women, men and students o Promotion specials should be implemented to attract more customers It is not necessary for all the funds to be allocated towards marketing initiatives because GBL should use them towards the gym expansion, overall attracting more customers. By offering a variety of classes and a gym equipped facility for working out, GBL offers the most services for similar prices as their competitors. The marketing initiatives proposed not only reach out to women, but target the other customer groups as well. This ensures that GBL is recognized as a diverse gym. A promotion that should be implemented is predominantly directed to women: if one registers their child, they will receive $10 off their BJJ classes and gym membership. These plans are financially feasible because there is enough money for the gym expansion and advertisements. In the future, it would be good to continue advertising to gain even more clientele, but as for now; the gym expansion should be a priority and would make GBL more competitive in the BJJ industry by differentiating themselves from their competitors. With the analysis, recommendations and exhibits provided in this report, they provide a detailed marketing plan to help GBL target their customers effectively, obtain a total of 140 members by the end of the year, and develop a strong reputation as the leading BJJ gym in London with the most impressive facilities and quality of training. 2 3 Marketing Challenge As an external consultant to Fateh Belkalem, the owner and operator of GBL, I have developed a comprehensive marketing plan to provide advice on how to increase the gym’s enrolment by 40%, how to define GB as the lead in the industry, who to establish as a target market and what are the most effective ways to advertise. Corporate Capabilities: Finance, Marketing, Operations and Human Resources Belkalem has financial savings of $3000 for advertising expenses and has secured $8000 from an investor. These funds can be used to invest in a new training and conditioning gym that will cost $10,000. If the expansion proceeds, there is $1000 left for marketing initiatives. Carlos Gracie Jr. founded GB in 1986 in Brazil. Due to the increase in BJJ in America, Carlos Jr. moved GB’s headquarters to California. As GB schools increased internationally, Carlos Jr. developed a franchising program. In 2012, GB was known to be the best and most respected Jiu-Jitsu franchise in the world. Since GB is already a well-established brand, advertising can be focused on what they have to offer to develop more customer awareness. GBL is open seven days a week on weekday afternoons, evenings and weekends. GBL offers child, beginner, advanced and open mat classes. Currently, there are 100 members. If the gym expands, it will appeal to more customers because there will be more space and they can offer a larger variety of services. It is highly suggest that Belkalem invests in the expansion. Presently, GBL has five assistant instructors and Belkalem, who plans to work full time teaching classes. Belkalem has a BJJ black belt, has been a practitioner for 20 years and has been dedicated to martial arts for 40 years. Belkalem is very experienced and can easily attract customers with his extensive knowledge. This means that the ads should focus on showcasing that GBL has the most skill and years of training in the BJJ industry. 3 4 Industry Analysis: Political, Economic and Social London’s municipal government has been promoting the importance of physical activity. This initiative is a great way to motivate residents to register for fitness classes like BJJ, overall increasing customer traffic for the business. In 2008, London suffered from an economic recession and has not fully recovered. As a result, Londoners may spend less on leisure activities. This could affect the enrolment numbers for GBL, however many are willing to sacrifice money for physical activity because health is important and worth spending on in order to maintain wellness. The city of London has a growing population of 370,000 and is home to Western University, which has an impressive student population. With this factor, GBL has the opportunity to reach out to students, ultimately expanding BJJ and attracting students to enrol for classes. Competitive Analysis: Direct and Indirect GBL has three direct competitors: Submission Academy, Bindner’s Jiu-Jitsu Academy and Adrenaline. Submission offers similar classes as GBL and the enrolment fee is lower. In order to compete with Submission, Belkalem must advertise on offering the best BJJ skills. Advantageously, Belkalem has a black belt and more experience than the owner who only has a purple belt. This factor differentiates GBL from Submission and justifies GBL’s premium pricing. Customers are more likely to register for GBL than Submission because they have been in the industry for longer and can offer more rewarding classes. The second competitor is Bindner’s Jiu-Jitsu Academy. The competitive factor about Bindner is that their membership is cheaper. However, GBL has five times as many members, they are open twice as many days and Belkalem has more experience in BJJ because his black belt is more advanced than Bindner’s blue belt. Bindner does not offer children classes, which 4 5 means that GBL attracts a larger demographic and offers more variety. Belkalem displays more commitment to his business and BJJ than Bindner because he teaches most of his classes, unlike Bindner. The fact that GBL is fully dedicated to BJJ and offers a variety of classes is a key point that must be mentioned in the ads. The last competitor is a MMA gym, Adrenaline. The gym offers a variety of activities, from yoga to kickboxing. Adrenaline and GBL’s prices are on par, making them the most competitive. However, GBL is specializes in BJJ, which differentiates them from Adrenaline. This feature can be used to their advantage by promoting their dedication and focus in BJJ. It is important that customers perceive GBL as the top academy in London with the largest selection of classes and services and most commitment to jiu-jitsu with the best skills taught, provided at a premium price (see Exhibit 1). By creating this image, customers will be more inclined to register for GBL than the other competitors. Consumer Analysis: Students, Males, Females and Children GBL has four main customer groups: Western students, males, females and children. All these groups primarily want to practice BJJ for physical fitness and self-defence. Although there are 40,000 students that could potentially be customers, it is a difficult group to target because most students are not locals. Students already have the Western Recreation Centre available to them – free of charge, therefore it is unlikely for them to look into taking additional classes off campus. However, an opportunity to engage students is to offer weekly classes at the rec centre. This will reach out to those with interest and gain their loyalty. Ads can be printed in the Western Gazette. Once the students practice, they may want to sign up for more classes at GBL. GBL does not need to spend much on marketing initiatives towards men because they naturally have a strong interest in BJJ. Men are particularly interested in competitive training; 5 6 therefore it would be a valuable opportunity to sponsor events and famous athletes. Unfortunately, at this time there are not enough funds for this idea. However in a few years when the business is more profitable, this idea would be feasible. Men are also more inclined to register if the gym is expanded so they can also work out. Since men do not need extensive ads, the London Transit Commission (LTC) bus ads are sufficient and inexpensive. Not only do LTC ads target men, but are also geared towards anyone who takes public transit or sees the bus. The next customer group is women: the smallest client base but with the most potential. Women mainly participate in BJJ for self-defence and physical fitness. To encourage participation from women, GBL should offer female only classes geared towards self-defence and conditioning if the gym expansion is made (see Exhibit 2). To reach out to women, ads must be made through LTC and social networking platforms, as they are popular forms of media that women use daily. Another way to attract women, specifically mothers, is to offer mother and children classes at the same time and a special price so it is more convenient and appealing for families. For example, if a mother enrols a child, she is eligible for a discount off her classes and fitness membership. If women sign up, they will suggest classes to their husbands and vice versa. As for the children group, in order to promote to them, it would be through the parents. As long as the women and male group are being advertised to, the children will naturally be registered because their parents are concerned about their health and knowledge in self-defence. Target Market Selecti
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