MCD2050 Marketing 1 - STP Analysis

Introduction 

Dyson Limited was established by Mr. James Dyson in 1991. The company is based in Malmesbury, United Kingdom. Dyson James Ltd. Is the parent company of Dyson Ltd. The company not only manufactures the vacuum cleaners, but also hair dryers. The cyclonic vacuum cleaners manufactured by Dyson Ltd. are also marketed by the company. In addition to that, the company also offers a wide range of other products. These include fans and heaters, air treatment and lighting products. The company aims on serving hotels, offices, transport hubs, and mainly the hospitality and the education sector (Bloomberg, 2019). The vacuum cleaners offered by the company are developed using the modern technology and are more focused towards the health of its customers. This essay sheds light onto the targeting strategy of the company, and other target market decisions, alongside a competitor analysis. The latter section of the essay presents a perceptual map. 

Targeting Strategy 

The quality differentiation strategy of the company has made it successful in today’s world (AbouElgheit, 2012). Dyson has been keeping up to the needs of its consumers for many years now. The brand has been able to convey the value of its products to its customers through its effective marketing communication strategy. The company has distributed its vacuum cleaners in several different parts of the world using various distinct strategies. Dyson has been dependent on global advertising campaigns and word-of-mouth as its major marketing strategies, various combinations of the two in distinct markets, to get its message across the world. Sears, Best Buy, Linens ‘N Things, Amazon, Roebuck & Co., and Target are some of the stores that distribute Dyson’s $399-$500 vacuum cleaners. The company makes TV appearances using unconventional designs and market appearances (Cuneo, 2003).

Three Segment Profiles 

Geographic Characteristics: The market opportunity for growth has been substantial for the company particularly in the Asian pacific region. The company is not only selling in the United Kingdom, but has also expanded to other markets. The company now sells in various international markets through its unique selling proposition and marketing strategy. In 2011, most of the vacuum cleaners that the company sold were in the international market and not in the United Kingdom. More specifically, 85% of the vacuum cleaners and other machines sold by the company were in the international markets. The figure has substantially risen in comparison with 30% of the international sales back in 2005 (BBC News, 2012). Dyson markets its products mainly in the United Kingdom, the United States, Australia and Japan (Hollenson, 2007). Countries like Canada, New Zealand, Northern Europe, Singapore, Easter Europe and Russia make up the most attractive market for the vacuum cleaner sales, expanding the growth potential of the company. Vacuum cleaners are demanded in these countries, especially in Eastern Europe, particularly because of their even walls and carpeted flows (Marsh, 2006).

Demographic Characteristics: The target market of the company has some specific demographic characteristics that has expanded Dyson’s search for its potential customers outside the United Kingdom, in the geographic locations mentioned above. These geographic locations already have some renowned vacuum cleaner brands that retail for up to $125, starting from $95. In comparison to the vacuum cleaner brands retailing within the range, $95 - $125, the vacuum cleaners manufactured by Dyson retail for about $300 - $500. This retail price is about three times as that of its competitors established in the locations that the company is pursuing. Therefore, the company looks for households with high income levels to be able to invest in its vacuum cleaners. Only the high-end consumers will be able to purchase the company’s vacuum cleaners. Since the vacuum cleaners retail for about $300 - $500, the minimum income level of a household shall be $300. In any given household, Dyson mainly targets the adults, or mainly the heads of the families. These are mainly the women and are likely to fall within the age range of 21 – 50 years. Another demographic characteristic revolves around the medical status of the customers (Pizzini). In other words, the company aims to target its vacuum cleaners particularly to those individuals that suffer from asthma or allergies. Dyson has installed HEPS filtration and the most advanced suction technology in its vacuum cleaners. As a result, the vacuum cleaners are able to suck in the fine particles of pet dander and dust. Asthma and Allergy Foundation of America has certified the Dyson vacuum cleaners as amongst the first to be engineered to eliminate allergens (Dyson, 2016). The company targets the pet owners as allergies and asthma can get worse through pet dander. 

Psychographic Characteristics: These characteristics include the personality, lifestyle, values and attitudes. The company mainly targets individuals falling into four major groups. In the first group, consumers tend to invest in Dyson’s vacuum cleaners particularly because of their technological efficiencies. The second group is made up of the individualists who rely on the vacuum cleaners manufactured by Dyson for the sake of technology only to not depend on other brand. The third group consists of the lifestyle users who invest in the vacuum cleaners not for its merits, but as a symbol of design and status. The final group of customers who invest in the vacuum cleaners are rather health conscientious. This group forms the major proportion of all the groups that Dyson serves. The marketing strategy of the company is mainly focused on how its vacuum cleaner eradicates the allergens (Pizzini). 

Target Market Decision and Justification 

The decisions of the company are mainly based on the demographic characteristics of the targeted market. Dyson not only targets women, but also men to some degree, over the age of 21. Consumers usually find the vacuum cleaners manufactured by Dyson to be appealing because they offer the quality performance (Parry, 2002). What consumers really need in a machine, or rather like about the vacuum cleaners manufactured by Dyson is their tendency of being energy efficient. The new generation requires the latest technology in a major chunk of their purchases. The vacuum cleaners are prepared with the latest technology to create ease for the customers. Consumers who invest in the vacuum cleaners manufactured by Dyson do not really mind a higher price by realizing that the more they spend at this point, the more they will save in the future. 

Competitor Analysis 

Dyson has put in a lot of money in research and development and getting patents to protect itself against competitors. The company also has its own microbiology lab. The market share of the company is 20%, which is followed by 9% of the VAX Ltd and 7% of the Hoover Candy Group in the United Kingdom, back in 2014 (Euromonitor, 2015). The fourth player in the market is Kirby, with a relatively narrower fan base as compared to the other three companies, as indicated by its lack of social media following (Simon, 2013). The three competitors also offer vacuum cleaners and other machines, with different models, prices, quality and innovation levels. 

Perceptual (Positioning) Map 

The criteria selected for the perceptual map includes “innovation” and “models.” Apart from price and quality, the three competitors differ in terms of the technological innovation they had been using for differentiating their vacuum cleaners. Besides, the number of models of the vacuum cleaners manufactured by each of the companies is what sets them apart, and give the customers a range of options to choose from. The perceptual map is as follows:

Less Models

Hoover has comparatively more models than Dyson (Hales, 2019). Both the companies use the latest suction systems and the modern technologies to design their vacuum cleaners. However, Dyson vacuum has an edge over Hoover, VAX Ltd and Kirby in terms of innovation. As discussed earlier, the company is the first to be certified by the Asthma and Allergy Foundation of America to be eliminating the allergens and promoting health and safety. None of the competitors has been able to develop its vacuum cleaners in that way. Hence, Dyson is innovative of all. Kirby has 7 models in total (Great Vacs, 2019). Hoover has a vast product line, with a lot of models falling in each category. The company has four categories of vacuum cleaners in total, namely, upright vacuums, cordless vacuums, stick vacuums, canister vacuums and pets. Each category consists of a lot of models. VAX vacuum cleaners also have a narrow range of models. The company secures the third position (VAX). Dyson, has the second largest number of models, with the first position being secured by the Hoover (Dyson).