Background

Create a strong marketing plan for eco shoes, or shoes with soles made from recycled tires.

Overview of the product

The product chosen for the marketing plan is eco shoes or eco boots, which contain soles made from recycled tires (“Sneakers With Everlasting Soles Made From Recycled Tire” 2018). The product is owned by a brand called OTH, who intend to manufacture and sell sturdy, sustainable and everlasting shoes which have been made from recycled tires. It must be remembered that all tires have a life cycle, and once they no longer serve the desired purpose, they are usually discarded. However, tires are made from rubber, which is not biodegradable. Once the tires have been discarded, they contribute to soil and air pollution owing to the various chemicals present in them. A tire starts the decomposition process only after four hundred years.  Thus, there is a growing concern as to the reusing and recycling of tires in order to minimize the waste generated (Valuev et al. 2014). There have been several innovative uses of tires; however, OTH takes it one step further by using the rubber from the tires to make soles for shoes. These shoes are not just long lasting and hardy but also fashionable and come in a wide array of colors and styles. In Europe, United States and Canada, a tire is disposed of every six minutes; that means more than 100 million tires are discarded in a year. At OTH, the company mission is to come up with a strong design that would simultaneously be eco friendly. According to the company policy, one discarded tire is recycled every time to produce three pairs of eco shoes.

Situation analysis

The company, OTH presents an eco friendly alternative as far as recycling of tires is concerned. It is estimated that more than a hundred million tires are disposed of each year across the globe; keeping in mind the fact that tires are non-biodegradable and can cause irreparable harm to the environment, it is of utmost importance to recycle them. The growing consciousness around the world has led to several creative uses of tires once they have been discarded (Fagundes, Amorim and da Silva Lima 2017). Similarly, OTH has also devised a strategy that allows it to recycle rubber from old tires to manufacture stylish and elegant footwear. However, the concept of making shoe soles from recycled rubber has caught on and there are several rival companies who may a competitive edge over OTH’s eco boots. It is thus important to carry out a PESTEL analysis of the environment OTH is operating in to understand the marketing objectives.

PESTEL Analysis

Market analysis

Research shows that more than almost two billion tires are manufactured each year and more than a billion tires are discarded as waste globally each year; out of that, only about a million are processed or recycled annually. The manufacturing process of tire is extremely complex and involves a combination of numerous methods and technology; that makes it practically indestructible, owing to which it classifies as a non-biodegradable product. This also renders tires difficult to recycle; nevertheless, tire recyclers around the world are coming up new and advanced methods for recycling the product and to safeguard the environment. Consequently, there have been a number of taxes and laws imposed which take into account the disposal of old tires and recycling of the same (Brief et al. 2013). As a matter of fact, adequate measures are being taken by federal governments to regulate the cost involved in recycling old tires by generating funding and by imposing heavy duties on the manufacturing of new ones. Amidst all this, OTS has emerged as forerunner in the tire recycling industry. By using the path breaking technology of recycling rubber of old tires to make shoe soles, OTH would be opening up new dimensions.

Market size, forecast and impending challenges

As of 2016, the market for recycling rubber to manufacture shoes and other products was valued at almost a billion US dollars and it is estimated to grow at a steady CGAR of almost two percent in the upcoming years. Issues regarding public health and growing need to reduce environmental damage, along with severe taxes and regulations surrounding waste tires have led to a boom in the tire recycling industry. Besides the need to recycle rubber used in tire, there is also an urgent demand to reduce air pollution caused by carbon dioxide emissions when tires are burnt in landfills (Thomas, Gupta and Panicker 2016). Reusing and recycling scrap tires would not only be an effective means of waste management but would also enhance the economic conditions of the country. However, there are some challenges which have hindered the growth of the industry as a whole. For example, the process of collection and assortment of tires from different locations like illegal and abandoned landfills is a complicated task; similarly, to remove steel wires from rubber in the tire is quite complex a process. This makes recycling of tires and consequent manufacture of shoe soles a challenging endeavor.

Marketing Objectives

Marketing environment

In the following sections, a PESTEL analysis has been carried out to study the various factors that affect the tire recycling industry. The various social, political, technological, legal, economical and environmental factors that affect the industry are bound to indirectly have an impact on the sales and revenue of the eco shoes.

Political factors

Studies show that a dearth of adequate resources and raw materials required for recycling tire materials have curbed the growth of the industry in the past. In addition, it must be ascertained that the process of recycling tire to make shoe soles is an expensive one, and not all companies would be able to maintain it. As a result, the government is taking requisite measures to ensure that the costs involved in tire recycling is reduced; one way of doing so would be by imposing taxes of production of new tires (Fagundes, Amorim and da Silva Lima 2017). A level of cooperation and collaboration between the government and the companies recycling tires would be essential to facilitate the sole manufacturing process. OTH would, however, have to keep in mind these regulations while carrying out their operations.

Economic factors

With growing concern about the long term impacts of tires on the environment, attempts are being made globally to counter the impending threat. As a result, there are several companies like OTH who are striving to come up with new and innovative methods of reusing and recycling tires. Analysis shows that the global tire recycling industry is expanding at a startling rate and is estimated to reach 1.12 billion US dollars by the year 2024; a steady growth in the industry is expected in the upcoming years (Yan 2013). With that in mind, several companies (both local and regional) are trying to expand their horizons by adopting the technology of tire recycling so as to attract international attention. The expansion of this particular industry is further propelled by the generation of crumb rubber, which is also used to make soles of shoes and concrete (Issa and Salem 2013).

Social factors

As far as the social factors are concerned, it is important to mention the growing need for tire management across the globe (Kannan, Diabet and Shankar 2014). People are gradually realizing the harmful impacts of their activities which involve blatant disposal of tires without pondering about the consequences. It is also important to consider why consumers would choose shoes with soles made from tires over shoes which use the conventional vulcanized rubber. The reason is simple; in order to successfully implement the process, it would require the involvement of both the consumer and the company.

Target Audience

Technological factors

The process of manufacturing soles from tire rubbers is not a novel one; it has been around for ages and only recently, its potential has been recognized. The first step in the process would be to collect and also sort the tires that have been discarded. Finally, the rubbers are manually molded and shaped to develop a fitted sole; these are long lasting and durable and would certainly add to the comfort factor that customers look for in footwear. However, the use of inexpensive imported oil and synthetic rubber have made the tires difficult to recycle; yet, OTH ensures that only the best, state of the art technology is used to convert the rubber into resilient soles for all kinds of shoes and boots.

Environmental factors

While globalization and advancement of technology has certainly brought the world closer, it has also triggered a consumerist attitude amongst the people. Not only does this mean that people are consuming more, but also means that they are generating more waste. In the case of tires, it has already been mentioned that more than a billion tires are manufactured each year; people today would not think twice before disposing off their old tires to replace them with new ones which guarantee better performance. As a result, the number of tire landfills was growing at an alarming rate (Chang and Gronwald 2016). This resulted in the need for recycling methods that would reduce the impact on environment. The tire recycling industry is segregated into numerous sectors because the possibilities are endless; companies like OTH have come up with ways of recycling rubber from tires to manufacture products that are not only sustainable but also appealing to the general public (Kotresh and Belachew 2014).

Legal factors

Given that the tire recycling industry is expanding at a rapid rate, several laws and regulations have been introduced around the world to ensure that no malpractice ensues in the process. Most of these laws seek to reduce waste generation in the first place by imposing taxes on the manufacture of new tires. For instance, a new law was passed in Ontario, Canada in 2017, which insisted that companies pay a price for getting rid of tires (and thus generate waste) during the life cycle of the product in question (Aem.org 2018).  

Before the marketing objectives are listed, it is important to understand the target audience OTH has in mind. The eco shoes and boots, under the canopy of OTH, would be released to the general public online, through a platform named Kickstarter. The website is dedicated to creative projects from around the globe. From large companies to small scale businesses that have innovative products but fewer means to sell them, Kickstarter has attracted the attention of thousands all over Canada and the rest of the world. The main target market for OTH would be the millennial generation, between the ages of 15 and 35. The generation of millennials is stricken by concern for planet earth; they are aware of the massive toll the age of globalization and industrialization has taken on the environment (Lu, Bock and Joseph 2013). Consequently, various campaigns and movements have been launched worldwide to spread awareness and to steer the world towards a greener future. As market analysis shows, OTH’s eco friendly solution to the problem of tire recycling would immediately appeal to this demographic. Moreover, OTH plans to market its product online, through Kickstarter and through social media; that would work in the favor of the company because they would be able to reach out to their target audience directly.

Conclusion

A detailed S.W.O.T analysis has been carried out in the following section to gain a better understanding of the product, its strengths and weaknesses to identify future scope for the company and the potential threats that could stand in its way to success.

Internal situational analysis

Strengths

• First and foremost, it must be mentioned that the shoes are 100 per cent eco friendly. Adequate measures have been taken to ensure that no excess waste is generated either during the manufacture or production phase.
• The shoe packaging used in the product has been made from 90 per cent recycled cardboard.
• The shoes are unique and simple in terms of design. They are elegant and sophisticated and mainly involve monochrome colors. However, the designers at OTH have taken necessary steps to include the style factor as well.
• The manufacturers have issued a 100 per cent warranty stating that the soles are ever lasting and immune to wear and tear.
• The company also follows a customer oriented marketing strategy and ensures excellent customer service to all consumers.
• The shoes come in various styles and sizes, and can also be personalized to fit the customer’s needs.

Weaknesses

• The concept of using rubber tire to make shoe soles is still in the initial phases of development; this means that the industry is still expanding and not many people know about it. Lack of patrons and recognition is a potential weakness.
• The company hires independent manufacturers on a contractual basis; this raises a question on the reliability of the organization.

External situational analysis

Opportunities

• However, the fact that the industry is still developing could be a potential opportunity for the company; it means that not too many companies are experimenting with the technology, giving OTH a competitive edge.

Threats

• Nevertheless, the company certainly has certain competitors like Brave Sole or The Allbirds Shoe Co.; while the former conducts operations online, the latter has approximately three stores. These stores have been in operation for a few years, making them experts in the field.

An investigation into the various strengths and weaknesses of the eco shoes have revealed that OTH can make significant progress in the industry if they proceed in a strategic manner. For instance, the use of recycled cardboard in packaging is an added bonus and throws light into the environmental policy of the organization. However, as the company acquires more funding, it would be beneficial if they were to appoint permanent manufacturers, instead of independent contractors. The company has already earned a positive reputation on Kickstarter and has generated a large number of leads since its introduction. The most crucial aspect of the marketing plan would be eliminating competition; it would be beneficial to remember that aforementioned competitors of OTH have a few years of experience which can give them a competitive edge. Thus, OTH would have to introduce a product or a variation in the product that sets them a class apart from the other brands in the same field.

The SMART model has been used to list the objectives.

• Specific – The main purpose of the marketing plan is to appeal to the target audience of OTH’s eco shoes through Kickstarter.
• Measurable – Since this is a website that harbors a plethora of creative projects, OTH would have to ensure that their project stands out in terms of presentation, appeal and also utility. The more alluring the project seems, the more leads it would generate as more and more people would be expressing their interest in the product. The success of the project will be measured based on the number of leads generated.
• Actionable – As a direct consequence, this would generate more funding for OTH, which can be further used to enhance the recycling and manufacture process. Also, the plan should be such that it immediately appeals to the customer and moves them to action.
• Relevant – The marketing also aims to promote the key benefits and advantages the product offers through traditional and social media advertising strategies (Ashley and Tuten 2015).
• Time bound – Since OTH is implementing its marketing plan online, all the activities and campaigns need to be executed in the next two months, to maximize impact.

Brand positioning and targeting

The target audience for OTH would mainly be the millennial generation, with the age range between fifteen and thirty five. The company’s marketing strategies would be targeted at the environmentally conscious citizens, who would be receptive to new, innovative and eco friendly technology. The company intends to position itself as a brand that is eco friendly and keeps in mind its ethical, social and environmental responsibilities while conducting business; that is precisely why the company uses recycled material for every aspect of the product, including packaging. The product would be presented as an affordable, stylish and sustainable alternative to conventional footwear.

Mission statement

The intended purpose of the marketing plan is to establish the eco shoe as a replacement for conventional footwear made out of traditional, vulcanized rubber. A product oriented marketing organization will be followed in the case of OTH’s eco shoes. The product would be the highlight of the marketing plan because of the ground breaking technology it utilizes. Such a product emphasizes on the need for sustainability, so as to minimize the impact on the environment. Thus, the marketing plan intends to shed light on the benefits using such a product will entail; however, it must also be ensured that the plan keeps in mind the target audience, and their unique needs and demands.

The marketing mix can help determine the course of the marketing plan. It is as follows:

• Product – The product in question is eco shoes, which have been made from rubber recycled from scrap tires. This also makes the product sturdy and everlasting. The shoes do not have excessive design; instead, they have been kept minimalistic and come in monochrome tones.
• Pricing strategy – A moderate income pricing strategy will have to be followed in this case. Recycling scrap tires and manufacturing shoe soles from them is a costly affair, and to compensate for that, the price of the shoes would have to be kept at a moderate range.
• Place – The product will be marketed online, through Kickstarter. The promotion activities will be carried out online in the form of emails and social media.
• Promotion – Since the product will be sold online, the advertising campaigns would also be restricted to social media and other online forums. That way, the company would be effectively able to reach out to their target audience.

The marketing plan intends to promote a fascinating new product, eco shoes, which have been made from recycled rubber from old, discarded tires; that, by design, is the main appeal of the product. The marketing plan would be taking advantage of the growing consciousness about the ill effects of ineffectual waste management and would utilize it to sell the product in question. All campaigns and advertising strategies would be carried out online, through the major social media platforms; this is because the company is aiming its marketing plan at the younger generations, who are bound to have an online presence of some kind. That would not only be cost effective but also have a wider reach (Vinerean et al. 2013). A budget outline has been provided as well:

Figure: Budget plan

(Source: Author)

While devising the marketing plan, it is important to come up with methods and metrics that would be used to measure the success of the marketing plan (Mintz and Currim 2013). Metrics like conversion rates, traffic on search engines, inbound links, page views and bounce rates on the Kickstarter website will be used to establish the effectiveness of the marketing plan. Controls will have to be introduced so as to scrutinize and reduce discrepancy between expected outcome and actual result. For that, it is important to regulate all expenses and keep extensive records of the same.

Most importantly, it is important to ensure that the marketing plan created is sustainable. A sustainable marketing plan is one that takes into account three dimensions, namely environmental, economic and social (Ottman 2017). The above plan has been made keeping in mind the product which has been specifically crafted to reduce pressure on the environment; that should be enough to add the sustainability quotient to the marketing strategy

References:

Aem.org., 2018). Ontario to Implement New Tire Recycling Requirements. [online] Available at: https://www.aem.org/news/july-2017/ontario-to-implement-new-tire-recycling-requirements/

Ashley, C. and Tuten, T., 2015. Creative strategies in social media marketing: An exploratory study of branded social content and consumer engagement. Psychology & Marketing, 32(1), pp.15-27.

Brief, P.P., Choi, M., Hudak, K. and Penabad, D., 2013. Scrap tire management.

Chang, S.Y. and Gronwald, F., 2016. A multi-criteria evaluation of the methods for recycling scrap tires. The Journal of Solid Waste Technology and Management, 42(2), pp.145-156.

Fagundes, L.D., Amorim, E.S. and da Silva Lima, R., 2017. Action research in reverse logistics for end-of-life tire recycling. Systemic Practice and Action Research, 30(5), pp.553-568.

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Mintz, O. and Currim, I.S., 2013. What drives managerial use of marketing and financial metrics and does metric use affect performance of marketing-mix activities?. Journal of Marketing, 77(2), pp.17-40.

Ottman, J., 2017. The new rules of green marketing: Strategies, tools, and inspiration for sustainable branding. Routledge.

Sneakers With Everlasting Soles Made From Recycled Tire. 2018. Kickstarter. https://www.kickstarter.com/projects/11402986/sneakers-with-everlasting-soles-made-from-recycled.

Thomas, B.S., Gupta, R.C. and Panicker, V.J., 2016. Recycling of waste tire rubber as aggregate in concrete: durability-related performance. Journal of Cleaner Production, 112, pp.504-513.

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