Global Fighter Jets marketing strategy and market mix approach

Global Fighter Jets Marketing Plan

Marketing Vision

Global Fighter Jets is poised to provide customers with high-edge military aircraft specifically to combat fighter jet. Our marketing efforts will be geared towards customer's reassurance that we are the first when searching for military fighter jet such as F-35 fighter in Israel. Our key to success will center on the marketing strategy that we will implement, and our marketing strategy is the marketing mix to expand the relationship with existing customers.

Marketing Mix

Global Fighter Jets will use 4Ps as marketing mix, which include Product, Price, Promotion, and Place. Several reasons make the paper to choose 4Ps as marketing strategy.

Product: A product relates to the specifications of goods as related to the satisfaction of customers. The company chooses product as marketing mix to provide combination of quality, brand name and features to launch the product into the market.

Price: The reason for using price in the marketing mix is that Global Fighter Jets will need to adopt competitive pricing to achieve market advantages. The company will try to cut costs by procuring materials that will be used to manufacture the aircraft from different sources. The company will also use the local materials to supplement the overseas material procured. Using this strategy to cut costs, the company will be able to provide its product at competitive price.

Promotion: Promotion of the product is critical to facilitate the product awareness. The company will use promotion tools that are cultural driven for product promotion and the promotion message will chose message that will enhance the product acceptance. The company will use outside marketing experts to design the promotion message that would be cultural acceptable in Israel. The company will use combination of advertising and publicity as marketing promotion.

Place: The company will use joint venture for the business strategy, which will enhance efficient distribution of the product. Since the aircraft factory will be located in Israel, the company will try to locate its factory at the strategic places to the military base to enhance efficient distribution of the product as well as enhancing reduction of the transportation costs. The joint venture that the company will employ will assist Global Fighter Jets to easily locate the distribution channel for the product.

1.2: Marketing Plan

Marketing plan provides the direction for the marketing activities. The marketing message will be designed to appeal to customers and other stakeholders. The marketing plan will address the following

Product modification

Pricing

Promotional program

Distribution channels

E-business

Product modification: The company will use the product standardization and product customization to specifically adapt the market needs. The product adaptation is the system of improving on the product to presumably adapt to the local market. On the other hand, product customization is the process of designing a product to suit the foreign market. (Bruce, Daly, & Kahn, 2007). In a global market, product adaptation represents an important element in product standardization, which influences the market performances. (Powers, 2010). In a global environment, product adaption is a unique marketing component that strengthens competitive market position. The company will use the product adaptation and standardization to create high-level interest for the F-35 fighter jet in Israel. There will be a modification of the product to communicate the company goals to the audience and. The company will also use the branding as a method of differentiating the Global Fighter Jets' product in the market. Typically, the company will use branding to demonstrate the core benefits that the product will deliver to target customer.

Pricing: The pricing is very important in the marketing plan. The company will not set a fixed pricing for the military aircraft. The pricing will depend on the product specification, delivery time, and quality of the product. However, the company will try to produce the product at low costs to set the competitive pricing for the product. The company will try as much as possible to strike the contractual competitive pricing deal with major customer to ensure the company enjoy long-term customer participation.

Promotional Program: Promotion program will take into the consideration the Israeli cultural aspect in the promotion plan. The promotion program will be designed in such a way that there will be no misinterpretation of local taboo to ensure that the product is integrated in the local market. The company will use combination of promotion strategy such as offline and online adverts for the product promotion. The offline advertisement will include TV adverts, radio adverts, and newspaper adverts. The company will also use the billboard located at the strategic places of the country to display the product. The online promotion program will involve the advert through the internet. To make the product more acceptable in the local market, the company will use local language for offline advert. However, combination of local language and major international languages will be used for online advert. Through the influence of advertising, the company will be able to differentiate its product against the competition.

Distribution Channels: Distribution plays important role to ensure customer acceptance. Global Fighter Jets will make the distribution channel to be cost effective. The company will build the warehouse at the strategic location and very near to the market to decline the costs of transportation. Since the Israelis government is presumed to be the major customer of the products, the company will locate the warehouse very close to the Israelis military base to decline the costs of transportation. The company will also use the accurate order's processing, correct invoicing, prompt delivery and back up services strategies to enhance market advantages. The prompt delivery is very important aspect that the company will use for brand differentiation. The company will position the product to occupy the valued place in the mind of customer, and the objective of positioning is to enhance the product differentiation.

E-business: In the contemporary business environment, internet technology has become a strategic tool that organizations used to achieve global competitive advantages. The company will use the internet as a direct channel to market. The company will design a website that will be used for the promotion avenue. Global Fighter Jets will use B2C (business to consumer), B2B (business to business) and B2G (business to government) as the business models to achieve global e-business objectives. (Chen, Wang, & Chiou 2009). The company will use B2G to facilitate business relationships with Israelis government, and there will be integration of e-payment to facilitate the payment system. As part of the B2C system, the company will use internet to conduct business with customers in Israel and other part of the globe. The company will use the internet to target customers in developing countries and emerging countries in South America, Asia and Eastern Europe. Typically, the company will use the internet to facilitate the order processing and order payment. The company will also use B2B to facilitate the procurement of materials that the company will use for the business. The company will introduce the e-procurement to facilitate the speed that the company procure materials from suppliers. (Chen, Wang, & Chiou 2009).

1.3: Market Indicators and Trends

Cook, (1996) argues that upgrading of the military aircraft has become a big business in the international environment. Similar to other business, the aircraft business has continued to experience growth, and the growth is due to the increase in the non-state actors that intends to attack the territorial integrities of some countries around the world. Following the terrorist attack at the U.S. Trade Center on September 11, 2001, many countries have decided to upgrade their military aircraft to protect their territorial integrities. Based on the need to protect the territorial integrity, there are competitions among the nation-states for the acquisition of military aircraft. The need to acquire the military ammunition has made many developing countries and emerging countries to turn to Israelis companies for the acquisition of military aircrafts. Data presented by Parker, (2005) reveals that countries such as Turkey, South Africa, Pakistan, Egypt and Saudi Arabia are the leading countries demanding the aircraft ammunitions between 2006 and 2011. Other countries with high demand for aircraft ammunition include Iran, Algeria and Nigeria. Based on the general believe that Israelis companies have the sophisticated technology to develop military aircraft, many of these countries are turning to Israel to develop their ammunitions. Typically, Israel has been able to do well in the military aircraft business because many governments in South Africa, South East Asia, and Eastern Europe are increasingly upgrading their military aircraft to ensure that they are fit for modern warfare. Between 2003 and 2008, the defence spending in Latin America grew by 91%.( Business Monitor International, 2011).

2: Financial Overview for the Global Fighter Jets

This section provides the financial overview of the Global Fighter Jets. The financial overview consists of the start-up funding, the projected profit and loss and project balance sheet.

2.2: Management of Foreign Exchange Risks

Despite the profits that the company will record after the second year, the company will face the foreign exchange risks in its global operations. Since Global Fighter Jets will be dealing with foreign currencies, the company is exposed to material risks that could affect the company profitability. There are several strategies that the company could employ to minimize the problem of foreign exchange risks.

First, the company could use the forward hedging to address the foreign exchange risks.

"The company should use the forward market hedge translation exposure by selling the exposed currency in the forward market, purchase the exact currency in the spot market on a later date, and then deliver the purchased currency against the forward contract obligation." (Shubita, et al. 2011 P. 173).

Moreover, the company could use the money market hedge in reducing the translation exposure. The money market hedging is done

"by borrowing foreign currency, exchanging the currency for dollars, and then investing those dollars. At the maturity of the investment, the dollars proceeds would be exchanged back into foreign currency to pay back the loan." (Shubita, et al. 2011 P. 174).

The company could also use the forward contract reduce the company's exposure to foreign exchange risks.

3: Sources of Financing for the Company

Sources of financing for Global Fighter Jets in Israeli are Israeli venture capital funds and Israeli local and foreign investors, which are the major source of financing for Israelis companies. (Mayer, et al. 2005). In 2011, Israeli companies raised $2.14 billion from Israeli venture capital funds and Israeli and foreign investors. Typically, Israel's venture capital industry consists of approximately 70 active venture capital funds of which there are 14 are international venture capitals. Thus, Israel's venture capital industry plays important role in raising finance for the companies in Israel. Since 2001, Israeli venture capitals have played important roles in assisting companies in Israel with financing. However, the financing declined in 2009 and 2010 as being revealed in Fig 2.

Examples of Israelis venture capital companies are as follows:

ARBA Finance Company

Aura Investments

Bridge Capital Fund (BCF)

Alta Berkeley Venture Partners

Susquehanna Growth Equity (SGE)

Meditech Equity Partners (ZMEP)

BlueRun Ventures (Israeli Government, 2012).

Fig 2: Source of Financing in Israel

Source: Israeli Government (2012).

Conclusion

The paper provides the marketing plan for Global Fighter Jets and the paper identifies 4Ps marketing mix as an important marketing tool that the company could use to enjoy marketing advantages. The company will enjoy market advantages in Israel based on the Israeli government intention to upgrade their aircraft ammunition. However, the company needs to use the combination of forward hedging and money market hedging to minimize the foreign exchange risks due to its exposure to global operations.