Marketing Analysis of Instacart

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Threats

Competition is always a major threat to any company in any industry and this is the case here as well as the company is facing intense competition from some big players with established brand names. One of the major competitors the Athletic Club is the most significant threat as it has two locations in London which eventually increase the threat.

Besides that the club is already offering TRX exercise to its members and offers a 24 hour service which means that the company has less ground to compete with Athletic Club. Besides that TRX will serve as a point of parity rather than a point of difference. Besides that the threat from Goodlife Fitness is also a concerning factor that is also providing TRX services to its members and is an established brand name.

Porter’s Five Force Analysis

This section will analyze the industry trends and will identify the five competitive forces that can be essential in shaping the strategy.

Bargaining power of Buyers

The buyers in the industry possess high power to bargain as there are quite a few reasons that eventually favors the buyers and increases their power. The first and the foremost reason is the standardization in the industry and every competitor is offering almost similar services and exercises providing less room for differentiation.

Besides that the competitors are competing against each other and making services attractive that is giving the ultimate benefit to the consumers. The consumers take full advantage of this battle and hold the power to shape the trends and pricing strategies of the companies. Furthermore, the switching cost is very low which is also in favor of clients and encouraging them to bargain easily.

Bargaining Power of Suppliers

The companies in the industry are not dependent on any supplier as the services are offered directly by the companies and can be referred as vertical integration. Although there is no such requirement of raw material and any other material, but hiring trainers can be a factor. However, the power of suppliers to bargain is missing in the industry and not a threat to the players in the industry.

Threat of New Entrants

The barriers to entry in the industry are very low and almost absent which is an encouraging factor for the new entrants. Besides that the concept of mobile gym is growing and becoming attractive for the new entrants as they see a reliable and affordable opportunity to start this business.

The cost of acquisition is also very low and the start-up capital required is also not very high which eventually favor the new entrants. All these factors combine together to provide new entrants an advantage and encourages them to enter into the industry, thus increasing the threat from new entrants.

Threat of Substitutes

Lots of people have started such fitness programs at homes and at different parks which are offering a substitute to the clients as they are less expensive and offer more flexibility. Besides that the clients can also seek digital mediums like YouTube to view videos and practice at home either individually or in groups.

All these substitutes are easy to initiate and operate and offer a price advantage to the clients. Thus the threat from the substitutes can be referred as a major threat which is increasing by the advancements in technology and offering more easy and convenient ways.

Competitive Rivalry

The competitive rivalry in the industry is growing and becoming intensified with the passage of time. Player AFL, Goodlife Fitness and Athletic Club are competing very strongly and the most significant players. Athletic Club has two locations in London, which is a significant advantage a major threat. Besides that, new gyms and fitness facilities are open and offering affordable practices which make the competition more intense.

STP

The club caters only females that belong to a middle age group and higher age groups. To be specific the club is catering females ranging from 16-60 who are mostly students and middle age women. The income bracket of these females is not clearly defined, but represents the section A and B of the society that is the middle income group and the high income group. The target market mostly resides in London, Ontario as the majority of the people are from the neighborhood. The clients are mostly health conscious who want to seek fitness in order to remain attractive and are motivated towards pole dancing. The psychographics of these females suggest that they seek sensuality and are more likely to adopt alternative ways to remain fit and aims to look beautiful and attractive. The target market as stated are mostly females that are seeking sensuality and fitness which is why the club has positioned itself as a hub to provide alternative fitness with an ability to provoke their sensuality.

Marketing Strategy

Product

The products that the club is currently offering include the pole dancing classes exclusively for women as a six week course. However, clients who are not interested in attending the whole course are allowed to take any class they want to take. These are the major offerings of the company and are squeezed, according the class strength as each class can accommodate up to ten students. Besides that the club also offers Bachelorette parties, but not on a regular basis, which is why this cannot be attributed in the product line.

Place

Currently the club is located in London, Ontario and is closer to the University of Western Ontario. The club is located in the downtown and possesses only club or franchise and is currently catering its clients with this one franchise.

Price

The company is following competitive pricing as the competition is very high and the product differentiation is very low which is why competing on price is very difficult. The products or the service of the company as suggested includes the six week fitness program which is priced at $159.99 for the entire course. However, the company is offering an early-bid price discount which offers the same course for $139.99. On the other hand, the company also offers flexibility to students to take any class during the course for which they have to pay $29 per class.