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HodgePodge Sealcoating Company
Market Analysis Summary
HodgePodge has identified two distinct segments of the population that are consumers of a sealcoating service. HodgePodge will have one marketing campaign that will reach both populations.
4.1 Market Segmentation
HodgePodge’s market can be segmented into two groups:
- People with disposable income who can afford to pay someone. This group typically has a household income over $50,000 and pay many service providers to maintain their home (i.e. lawn care).
- Older people that believe they are not physically capable of doing it themselves, or choose not to. This group believes that sealcoating is too much exertion for them or way too messy, particularly at their age. This group also believes that sealcoating the driveway will greatly extend the life of the driveway.
|Year 1||Year 2||Year 3||Year 4||Year 5|
|Middle to upper class||9%||18,545||20,214||22,033||24,016||26,177||9.00%|
4.2 Target Market Segment Strategy
HodgePodge’s strategy for reaching these people will be based on a series of advertisements in the local paper. Within the metro section of the paper there is an area where local service providers advertise. This section appears to be well received by the readership as people of the community often refer to this section when they are trying to find a service provider.
In addition to the advertisements, HodgePodge will also have a yellow pages advertisement. Lastly, HodgePodge will leverage word of mouth referrals. HodgePodge will create an economic incentive for current customers to make a referral for a new customer. While this will take a small amount away from profit margins, it will build a loyal customer base for successive years.
4.3 Service Business Analysis
The sealcoating business is made up of primarily independent contractors, larger paving companies, and a few franchises. In general the bulk of the business is from independent contractors.
4.3.1 Competition and Buying Patterns
The sealcoating industry is made up of independent contractors that do paving and sealcoating, as well as two sealcoat specific companies, Dura-Seal and Sealer King.
The buying patterns of consumers are typically based on price and and perceived customer service, with an emphasis on price. Price is emphasized is because there often is little to differentiate companies based on the actual product (because the customer is not aware of the seal coating materials until the job is done and even then it is very difficult for the consumer to perceive a difference) and in general the industry is not known for its stellar customer service.