Situational Analysis And Target Market Analysis Of Ingogo’s New Cab Service For Aging Population In Australia

Situation Analysis

You are require to conduct a situational analysis that consists of a comprehensive external and internal analysis for a new product or service from the predetermined list.

Huge competition in the global market leads the business to change their marketing plan and introduce a new product in the market. In the modern era, digital marketing is adopted by many organizations to promote their product in the international market (Armstrong, 2015). This study deals with the development of a marketing plan to introduce a new product of Ingogo Company in the consumer market of Australia. Ingogo Company offers unique taxi service through online booking and payment scope (Ingogo.com.au, 2018). The main target markets of this organization are the students and the young office goers those are highly dependent on cab or taxi service. Ingogo is the first taxi network in Australia, which offers app based payment service. This report highlights the situational analysis, target market analysis, financial goal, and marketing mix analysis to reveal the feasibility of the Ingogo product in Australian market.

Situation analysis includes both macro and micro environmental analysis in the context of Ingogo.

Macro environmental analysis is done by using PESTLE analysis. The political environment of Australia is stable and peaceful. Therefore, the government has introduced new law and policy to enhance the business as well as entrepreneurship plan. Such political situation will help Ingogo to introduce their new taxi service via digital app in Australia. Economic factor of Australia shows that the maximum people belong from the middle class and working group. The income level is good and the purchasing habit of the people is generous that leads them to purchase a new product (Islam & Mamun, 2017). The social environment of Australia is a mixture of all age groups. In Australia, the majority is the older group and young generation is involved in work after completion of their study. Hence, the introduction of a special taxi service for the old and young aged people will be helpful for Ingogo to expand their business in Australian market. Technological factor reveals that Australia is a technology-oriented country where IBM and Oracle have their offices. This advanced technology enables Ingogo to tackle their product promotion by using digital application (Rubin, Aas & Stead, 2015). The company should consider the environmental issues during their business. Ingogo needs to follow environmental laws such Environmental Protection and Biodiversity Act 1999 to reduce their business impact on the environment. Therefore, by including CSR activities in their business they can run their business in a responsible way. Legal factor focuses that Australian government introduces new taxation policy to support the business. Hence, Ingogo needs to follow the legal norms to conduct their business in a transparent way.

Macro Environmental Analysis

Porter five forces analysis shows the competitor analysis of this organization. Threat of new entrants in the context of Ingogo is low as in Australia no app cab service has introduced special taxi service for the old people. Maximum cab service focuses on the young generation. Therefore, the buyer power is high in this country. Threat of the alternative product is moderate in the context of Ingogo as the completion level is low. In order to low the suppliers power Ingogo needs to make a proper communication with the suppliers and to take raw materials at a specific rate. Competitive rivalry focuses on the major competitors of an organization (Dobbs, 2014). In the context of Ingogo, the occurrence of competitors is moderate as this organization is popular for safe driving and innovation in the Australian market. This improves the brand image and leads this organization to gain competitive advantages.

From the assessment 1 the SWOT analysis has been received. According to the SWOT analysis of Ingogo, it has been found that popular brand image, consumer preference and ability to produce an innovative product are the main strengths of Ingogo (Ingogo.com.au, 2018). On the other hand, Ingogo is new in app domain and it has not much experience in developing taxi service for the senior citizens. On the other hand, they have poor knowledge about the current demand of the market. Such weaknesses may create the challenge for this organization in Australian market. They have opportunities to penetrate in the new target market and attract the aging population for their service. One of the major threats of this organization is the lack of life-saving support system in this cab as any old customer may fall sick during the travel. This will hamper the growth of this organization.

Problem statement

The current problem of Australian cab service industry is the lack of reasonable service for the customers. On the other hand, there is safety issue and lack of proper communication with the customers in the taxi service industry in Australia (Currie & Delbosc, 2017). However, such high rate of taxi service, poor communication with the customers and negligence of the driver create challenges for the customers to get accessible service. In order to deal with this situation Ingogo has offered safe, reasonable and online payment service via their cab service. 

Discussion of the potential market segment

Table 1: Market segmentation in the context of Ingogo

(Source: Ingogo.com.au, 2018)

Micro Environmental Analysis

Based on the above analysis it has been received that the market segmentation is done based on the categories of the consumers. However, to identify the exact target market it is crucial for the business organization to create market segmentation (Prayag et al., 2015). In the context of Ingogo, the segmentation is done based on the business market and consumer market. It has been found that the business market includes corporate users. On the other hand, the consumer market includes three types of consumers. Mainly students, office goers, and aging population are the main three types of customers of Ingogo. However, different market segments have different types of needs. The professionals and the office goers need quick service and quality service while the students need service at reasonable rate. The corporate users need 24 hours service at different geographic locations. Based on this demand Ingogo needs to provide cab service to the customers. In order to meet the different demands of the target market, Ingogo has introduced taxi service via digital application. As commented by Yang, Wu & Wang (2017), digital communication is the most effective way to promote a service or product in the consumer domain. Hence, by providing cab service via digital app Ingogo will be able to connect with their target segments at different locations.

Ingogo has introduced a special cab service for the aging population via offering a digital support app. The target audience is categorized into office goers, students, aging people and corporate users (Ingogo.com, 2018). Among these groups, they have selected the aging population for their new cab service. The aged people are categorized into primary and secondary group. The primary target group includes aging population above 45 years and the secondary group includes consumers of all age groups. Market analysis shows that the market size of the aging population is growing rapidly. Thus, at present many cab service providers have decided to offer unique service to satisfy the senior people. In order to attract the senior citizens, the marketers are trying to offer the right product by incorporating innovation into their product or service development (Lancaster & Massingham, 2017). Ingogo has taken initiatives to attract the aging population by their unique cab service through support app.

Figure 1: Positioning map of Ingogo

(Source: Ibrahim & Gill, 2015)

Based on the above positioning map analysis the current position of Ingogo is defined. Ingo offers online payment facility to the customers during the cab service. Hence, from the positioning analysis, it has been addressed that Ingogo has used product differentiation strategy, which leads this cab service organization to develop a most convenient and value-added service. In the positioning map, Ingogo is present at first quadrant, which ensures that it has got a valuable position in Australian cab service industry. However, the competitors such as premier cab, 13 cabs and Logan city yellow cab are present in the other quadrants.  Providing high-quality service at low price will help the business to gain competitive advantages (Ibrahim & Gill, 2015). This is seen in the context of Ingogo. Their unique service and pricing strategy lead them to gain a good position in the app cab domain. The revenue of Ingogo has been increasing in every year, which ensures its high growth in the market.

Discussion of the Segmentation, Targeting and Positioning Approach in the Context of Ingogo

Figure 1: Current market growth of Ingogo

(Source: Ingogo.com.au, 2018

Marketing objectives

• To increase the market share steadily
• To increase the target customers by 4%
• To cover new customers in different geographical regions

Financial objectives

• To increase the profit margin by 2% per quarter
• To reduce the operation cost by using specific financial strategy
• To reduce the training cost of the staffs besides improving the service quality

Marketing mix

In order to introduce a product in the market, marketing mix is crucial for an organization. By following 4ps marketing mix strategy the business organization will be able to improve their service in the target consumer domain (Jindal et al., 2018). Product is the first element of marketing mix. Ingogo has introduced first app-based taxi payment system in Australia. Such app based taxi payment service is their new innovation that makes their business unique in Australian taxi industry. This is a fast online cab service, which enables the customers to get quick service. Next price is another element of the marketing mix. The profit and survival of an organization depend on the pricing strategy of an organization (Huang & Sarigöllü, 2014). Ingogo is new in the app cab domain. They want to increase their market share, which can be done by penetrating in the new market. They have taken market penetration pricing strategy, which allows them to offer service at low price. However, the customers are looking for cab service at low price. Hence, by using this market penetrating strategy Ingogo is able to offer service at reasonable price. Such pricing strategy also helps to avoid loss and to draw attention away from the major competitors. However, Ingogo offers fixed fare and no extra charge is taken due to traffic Jams. This is first Australian ca service, which offers a fixed price to the riders.

Place is the third element of 4ps, which focuses on the distribution of the product on service. Ingogo provides service in Birsbane, Sydney, Melbourne and Adelaide across Australia. This cab service offers smart phone app, which can be downloaded at any time and at any place in Australia. This app can be easily downloaded from Playstore. On the other hand, the web version of Ingogo is available. Moreover, the location of this cab can be tracked via mobile phone. Promotion is the 4^th element of 4ps mix. In the recent years, maximum businesses tray to promote their product via social media as it is a cost-effective process (Hisrich & Ramadani, 2017). Ingogo also focuses on the digital promotion via social media. They share information regarding their new service through social media. Therefore, they advertise their product by using satirical ad. They have developed a campaign with the help of media agency. They include videos on their website this video is transmitted via social media platform of Igogo by using Twitter and Facebook. They also focus on newspaper and distribution of leaflets to promote their service.

Figure 2: Marketing 4ps

(Source: Hisrich & Ramadani, 2017)

In order to implement the marketing mix strategy, Ingogo needs to define the product or service in detail. It is important to reveal the unique feature of the service or product to develop a proper product strategy (Bahadir, Bharadwaj & Srivastava, 2015). Ingogo needs to showcase the product feature during the marketing campaign. To develop the pricing strategy it is crucial to conduct a market research. By using a vast market research Ingogo will be able to gather the data. Based on this data Ingogo will be able to ensure that they do not under price or overprice their service. Therefore, it is important for Ingogo to understand, which type of digital app is preferred by the consumers. This will help them to distribute their service in the target customer domain. Finally to give shape the promotional strategy Ingogo needs to communicate the value of their product. It is essential to analyze the product by using the variety of media. Therefore, they can take help from the advertising agency to promote their unique taxi service. Moreover, the financial resources need to be managed properly to conduct the promotion of the business.  

Objectives of promotion mix

• To increase the demand
• To create awareness among the customers
• To improve the product value

Budget allocation should be done based on the promotional objectives. In order to meet the promotional objectives, proper allocation is required. The budget of a promotional mix in the context of Ingogo is followed:

Table 2: Budget allocation for promotional mix

(Source: Author)

From the above table it has been received that newspaper advertisement is the costly process in comparison to other advertising media. However, digital media such as social media and online advertising are the most cost-effective ways. Newspaper and traditional media help Ingogo to improve the product value and increase the awareness among the consumers regarding the new taxi service. On the other hand, social media and online advertising enable this organization to increase the demand of the consumers as maximum consumers spend their time on social media and internet to search new product or service.

Conclusion

The entire study focuses on the new service of Ingogo in Australia. However, their special service is the app based online payment service. They have taken low pricing strategy to attract the students and the old population. However, their promotional strategy includes digital communication with the customers via social media. Moreover, such marketing mix strategy of Ingogo will be helpful to enhance their business across Australia. Therefore, the budget allocation of Ingogo for promotional mix is helpful to meet their promotional objectives

References

Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction. Pearson Education.

Bahadir, S. C., Bharadwaj, S. G., & Srivastava, R. K. (2015). Marketing mix and brand sales in global markets: Examining the contingent role of country-market characteristics. Journal of International Business Studies, 46(5), 596-619.

Currie, G., & Delbosc, A. (2017). Transport and the Older Australian: Freedom, Challenges and Opportunities. In Ageing in Australia (pp. 193-206). Springer, New York, NY.

Dobbs, M. (2014). Guidelines for applying Porter’s five forces framework: a set of industry analysis templates. Competitiveness Review, 24(1), 32-45.

Hisrich, R. D., & Ramadani, V. (2017). Entrepreneurial Marketing Mix. In Effective Entrepreneurial Management, pp. 75-99.

Huang, R., & Sarigöllü, E. (2014). How brand awareness relates to market outcome, brand equity, and the marketing mix. In Fashion Branding and Consumer Behaviors (pp. 113-132). Springer, New York, NY.

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Ingogo.com. (2016). ingogo fixed fare online taxi booking. Retrieved 17 May 2018, from https://www. ingogo.com.au/

Ingogo.com.au. (2018). Ingogo. Retrieved on May 17 2018, from: https://www.ingogo.com.au/qantas/

Islam, F. R., & Mamun, K. A. (2017). Possibilities and Challenges of Implementing Renewable Energy in the Light of PESTLE & SWOT Analyses for Island Countries. In Smart Energy Grid Design for Island Countries (pp. 1-19). Springer, Cham.

Jindal, P., Zhu, T., Chintagunta, P. K., & Dhar, S. K. (2018). Point-of-Sale Marketing Mix and Brand Performance-The Moderating Role of Retail Format and Brand Type.

Lancaster, G., & Massingham, L. (2017). Markets and customers: market boundaries; target marketing. In Essentials of Marketing Management (pp. 70-101). Routledge.

Prayag, G., Disegna, M., Cohen, S. A., & Yan, H. (2015). Segmenting markets by bagged clustering: Young Chinese travelers to Western Europe. Journal of Travel Research, 54(2), 234-250.

Rubin, T. H., Aas, T. H., & Stead, A. (2015). Knowledge flow in technological business incubators: Evidence from Australia and Israel. Technovation, 41, 11-24.

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