Marketing Financials | Course Paper

CornerSIMS Marketing Plan

Table of Contents:

Executive Summary

…1

Marketing Intelligence

…2

Situation Analysis

…2

Macroenvironment

…3

SWOT Analysis

Attachment One

Marketing Strategy

…6

Addressing Both Markets & Competition

…7

Goals and Objectives

…8

Pricing and Sales Expectations

…10

Marketing Tactics

…10

Campaigns

…13

Financial Projections

…14

Financials

Attachment Two

Implementation Controls

…17

References

…21

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Executive Summary

CornerSIMS LLC (CS) is a business located in Seattle, WA that provides a range of oils

and e-cigarette liquids that contain both THC and CBD for customers across the country. Using

strong links with dispensaries and retailers across the country (as well as a strong online

presence), CornerSIMS delivers a range of different e-liquids to suit both medical and

recreational needs. This plan will discuss a number of areas of CornerSIMS’ marketing

operations alongside an evaluation of the market environment. This will help to direct company’s

efforts towards the set goals for growth by allowing the company to set attainable goals for its

activities while providing a vision of how CornerSIMS will reach the target market through the

marketing and sales process.

The cannabis market is a valuable industry, currently experiencing a period of explosive

growth and what some may have dubbed “A Golden Age of Cannabis”. The state of the market

still provides a large number of opportunities with little-to-no consolidated control by large

organizations. This creates a breeding ground for the future “Big Cannabis” companies, and

CornerSIMS aims to become one. The company will operate in both the medical and recreational

cannabis markets, with one being bigger, but the other being growing at a faster rate.

CornerSIMS aim to create a range of different e-liquids with different price points to appeal to a

wider range of customers.

The unique selling point of CornerSIMS’ business will be the effective for purpose,

affordable, and strongly branded e-liquids the company provides. CornerSIMS will offer clients

the biggest and best range of THC and CBD oils on the market, along with a range of

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information, help, and merchandise that they can also benefit from, free of charge. The company

aims to really add value to the lives of its consumers. This plan outlines the company’s

industry/market, target audience, the strategy CornerSIMS will implement to generate sales of

$101 million dollars in the first year of operations, along with the tactics which will be used to

attract these people. It also contains a detailed financial analysis that forecasts our expected

income and outgoing costs over the next three years, to support the company’s attempt to achieve

its’ goals and objectives It will then be concluded by an explanation of the controls put in place

to ensure the plan is properly implemented, and how we will react to any changes in our

operating environment to ensure profitability and adherence to our planning.

Situation Analysis

This section will contain an analysis of CornerSIMS’ market, and cover issues such as

customer demographics, competition, market opportunities, and the business environment. This

will provide CornerSIMS with an insight into the target audiences, an ability to identify

opportunities for growth, and foresight to help prepare the company against threats to its

operations. After discussing the research, CornerSIMS will evaluate the various aspects of the

medical and recreational markets to allow the company to plan the entry to market and

subsequent growth in market share and sales. This will be followed by an analysis of the

company’s opportunities and threats, based on the strengths and potential weaknesses of the

business.

Marketing Intelligence

During the investigation, the company has discovered a number of interesting information about

the market, both in terms of legislation and social factors. CornerSIMS has also measured the

size, value, and profitability of the market in economic terms. Some of the key findings include:

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Demand on the market remained strong in 2016 with a 25% increase over 2015 to $6.7 billion.

By 2020, legal market sales will grow to $21.8 billion, with adult use sales comprising more than

half (53%) of the total market (Arcview Market Research, 2016, p. 30). This shows, that the

market is estimated to grow significantly over the next 3 years, giving a valuable opportunity to

grow and establish a leading role in the industry, while also retaining the position of the largest

manufacturer of THC and CBD infused oils. Market expectations can provide CornerSIMS with

opportunities to expand into other areas of the industry, especially in the terms of production of

legal cannabis.

The industry’s continued expansion is matched by equally strong growth in popular

support for cannabis legalization nationally. According to (Gallup, 2016, p. 16), 58% of

Americans now support legalization of cannabis for adult use, up from 36% in 2005; and a

separate poll found that 81% of Americans support legalization for medical use. The company

also found a range of useful information regarding the legal status of cannabis across the country,

much of which showed that due to the continued surge in popular support for the legalization of

cannabis, there are still a large number of opportunities in the form of new regional markets as

more and more states legislate in favor of cannabis. Arcview Group (2016) has reported that in

the Washington State, the first year of legal sales generated $70 million in tax revenue from sales

of $257 million, a significant windfall even after e-liquid shortages and pricing instability

plagued the program during its early months.

Although the data shows there is a high demand for cannabis legalization in a number of

states, meaning the creation of a number of billion dollar markets for CornerSIMS to operate

within, the growing industry is saturated by a number of small producers, meaning CornerSIMS

will have to make an effort to set itself above the competition by operating on a much larger

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scale. In order to analyze the current, general market situation, the information in the section is

based on extensive research and the insights provided significant understanding of the value and

process of the market, the audience CornerSIMS is attempting to understand, and legal

conditions surrounding the industry for further planning.

Macroenvironment

Despite the recent political trouble, the US business environment is still thriving with

production and distribution of cannabis and a number of surrounding industries consistently

showing good growth rates and profit. This section provides an outline of the conducted research

and reports on the findings on information from various aspects of the environment CornerSIMS

is operating in, covering demographics, economics, and sociocultural, while also dealing with

many legal issues and restrictions the industry is currently working to adapt to.

Demographic Environment:

The demographics of the cannabis industry’s target audience are important to company’s

marketing process, and by performing an accurate analysis of the target audience, CornerSIMS

will be able to convert its investment into a return in sales in a more effective manner.

CornerSIMS’ users will be primarily male (accounting for more than two-thirds of legal

purchasers) and will come from a wide variety of age groups, with the average age of a customer

being 37 years. The average customer spends a median of $33 per trip according to the data

provided by the business intelligence company Headset (2016), and by providing e-liquids that

last longer and are healthier, CornerSIMS’ own target audience may be enticed to spend above

the median. This means CornerSIMS can plan its marketing accordingly, and fine tune things

like advertising online and on social media to specifically target different age groups with

different marketing campaigns. The average spend may be a problem based on CornerSIMS’ e–

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liquid pricing, however, CornerSIMS will have to communicate to the audience that the e-liquids

are a good investment to save money and that they suit their purposes well.

Economic Environment:

Data provided by US Census Bureau (2017), shows that current economic environment

consists of multiple regions of the continental US, which on average tend to have very high

levels of disposable income, meaning the target audience will have larger budgets for

CornerSIMS’ e-liquids compared to many states with more restrictive laws and weaker

economies. Due to the fact that Washington State has no state income tax according to the latest

information by the state Revenue Board (2017), Seattle workforce being among the most well-

paid in the US as reported by Kiersz (2016) and combined with its’ growing economy as

reported by both Bureau of Labor Statistics (2017) and Scott Cohn of CNBC (2017), this makes

it an ideal location to base CornerSIMS’ operations. Both due to the fact CornerSIMS will be

able to build a strong customer base using social connections, and an advantageous economic

environment.

However, there are some negatives associated with operating within the Washington

state economy. This concerns the lack of investment in education as reported by education

report of Seattle Times Claudia Rowe (2016) and infrastructure, highlighted by infrastructure

report by the American Society of Civil Engineers (2013). This could lead to problems with

operations and human resources efforts within the business in the near future.

Regardless, due to the combination of a welcoming taxation from the state, and the

strength of the local and regional legal cannabis market (especially considering the very valuable

market in California nearby), CornerSIMS believes these benefits outweigh the increased risk of

complications in future operations.

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Sociocultural Environment:

Cannabis is becoming more and more commonplace in American culture, and after a short-

lived prohibition, is gradually accepted again in many communities across America. This means

CornerSIMS has an opportunity to help influence the debate by working with CornerSIMS’

business stakeholders in order to improve people’s lives. Cannabis has been a highly cultivated

plant for the most of recorded history and has enjoyed long periods of time in many nations

complete legality of production and consumption of the plant. Despite many countries

prohibiting cannabis during the 20th century, it is being accepted by people across the world

once again, with many countries liberalizing their laws on cannabis.\

Although there are still some opponents to the use of cannabis, especially in religious and law