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MARKET OVERVIEW
Figure 6– Ansoff Matrix showing suggested segments for NUTSPotential new market segmentsA problem for NUTS is sales maximisation. Often, the first and second nights of production runs are booked well below capacity (as little as 50-60%). Nuts are unable to increase their revenues and profits by extending their runs over more nights due to the constraints regarding students giving up their time for free (this would also incur increased costs of venue and equipment hire). The problem that exists is to fill the venues to capacity each night and enhance the contribution.aihuau.comIdentification of new market segments is seen as the key to achieving this. The following market segments were identified and considered.8226; Schools and Educational Establishments8226; Adults with disposable income; Dinks, Dewks and Woofs8226; The broader Universities CommunityEach segment was evaluated against the following criteria:8226; Strength of Competition8226; In line with current objectives and strategies8226; Strengths 8226; WeaknessesSchools and Educational EstablishmentsCompetition – Strong competition exists with a number of theatre groups, theatre venues and cinemas tailoring products specifically aimed at this market. The competition is perceived by schools to be more professional and suitable for the intended audience.In line with current objectives and strategies – The assumptions made were that NUTS would be reluctant to change its product and its method of delivery therefore this market would not be feasible.Strengths – There are a large number of schools and students in the area and NUTS price offering would suit their market. NUTS could tie in some shows to suit the English syllabus.Weaknesses – NUTS would need to radically change their product which they are reluctant to do. Alternative venues would need to be found. NUTS are not able to take their products into schools for two main reasons: 1. Cost and inconvenience of transporting cast and equipment and 2. Schools would require performances during the day when NUTS’ cast members are likely to be in class. NUTS would have to change their image entirely (for example the website) and this could expose them to the risk of compromising their unique selling points.
Adults with Disposable Income: Dinks, Dewks and WoofsCompetition – Ferocious competition with little constraint on buying power – all venues identified in the competitive analysis come in to play many of whom have large advertising and promotion budgets and have the ability to take on competitors head to head in the marketplace.In line with current objectives and strategies – Some of this segment would be willing to buy NUTS’ product as it stands. However to exploit the segment to its full potential, NUTS would have to alter its product to make it more mainstream. This is at odds with their core values.Strengths – This segment is the least price sensitive considered and they have spending power to be repeat customers again and again. Many of this segment may have ties to the university or enjoy encouraging young amateur talent.Weaknesses – Venues could be a major problem for this segment as well as the overall quality of the experience as a whole. Many in this segment expect a degree of luxury which NUTS are unable to deliver. The combination of NUTS’ core segment and this new segment also do not sit well and they are in fact threats to each other. NUTS would have to radically alter all their Promotion, Place and Product to meet the demands of this segment en masse. Price may also need to be altered as the current ticket price does not portray the quality which is delivered – this could preclude the student market.The Broader Universities CommunitiesCompetition – In each market there is a degree of competition however for this segment it is reduced by the factor of pricing to a certain degree. There are also no direct competitors i.e. Nearby Universities with active theatre societies.In line with current objectives and Strategies – This segment are well accustomed to the University / Student way of life. They are comfortable with the style of venues, the types of productions and the way in which they are promoted and delivered. Therefore no adjustments would be required.Strengths – NUTS would not have to alter it’s product in the slightest to meet the requirements of this segment. There is a huge slice of this segment that so far has been untapped. The following “micro segments” exist: Post Grad and International Students at Newcastle, Lecturers and Staff at Newcastle as well as Under Grad, Post Grad, International and Staff Members at Northumbria, Sunderland and Durham Universities.Weaknesses – This is a very price sensitive segment, where disposable income is low and there are a wide variety of alternative forms of entertainment.Figure 7 – Bar chart showing increase in students at Newcastle and NorthumbriaSource: www.ncl.ac.uk, northumbria.ac.ukThe chart above shows that the chosen segment is not only lucrative now but is growing and should become more fruitful in the future.
