Creating adequate conditions for promoting innovative goods and services depends on numerous factors, including the geographic location of the region for sales, the indicators of consumer demand, brand value and other significant criteria. Today, even start-up companies can offer relevant propositions if the direction of activity is chosen correctly and corresponds with market interests. As the topic of this work, producing a strategy for promoting and developing a business marketing course for electric charging stations for vehicles under the Charge-Your-Car (CYC) brand will be considered.
This project is unique and, despite the dominance of other corporations in this field, for instance, Tesla, CYC offers potential customers convenient services. Among the features that this business has, remote control from a personal gadget and the choice of cost and duration of charging are useful options. The assessment of opportunities for developing this business will be considered in the context of the Russian market as an environment open to innovations. The analysis of strategic partnerships, the evaluation of possible competitive threats and other stages of advancement can allow drawing objective conclusions regarding this project’s success in a specific environment and setting objective priorities.
Value of Strategic Partnerships
Since the Russian market is not rich in innovations due to the country’s focus on its own products and restrictions in the form of sanctions, implementing the considered project in this region may take place in the conditions of establishing partnerships with representatives of large transport holdings. CYC offers convenient and understandable services, and as a marketing promotion strategy, the business representatives can demonstrate the capabilities of this project to Russian corporations by using test models of electric cars.
Cheong, Song and Hu (2016) cite an example of Tesla, the world-renowned company specialising in the sale of high-tech vehicles, and mention the practice of cooperation. According to the authors, Tesla representatives entered into partnerships with other major members of the automotive market, which allowed them to coordinate fixed costs successfully and avoid being crushed by competitors (Cheong, Song & Hu, 2016). Therefore, this method of project promotion can be successful and in-demand.
Another reason why strategic partnerships can be implemented as a method of expanding the CYC business is a chance to introduce an acquisition strategy. For such a small project, the Russian market may become a valuable niche due to the lack of analogues of the offered goods and services, which, in turn, can contribute to monopolising this industry and increasing influence in the region. In addition, as Cheong, Song and Hu (2016) state, strategic partnerships do not have to entail strict obligations and may give companies an opportunity to promote their business freely by coordinating production capacities on their own. As a result, such a practice can become a valuable method for CYC to expand its sphere of influence and attract a wide range of potential consumers.
Business Purchasers
One of the main obstacles that CYC representatives may face when promoting their business in Russia is the lack of local companies’ readiness for products of this format due to insufficient demand for electric vehicles in the region. Therefore, when choosing business purchasers, it is essential to pay attention to those companies that are ready to acquire innovative goods and services and develop the industry of the alternative sources of fuel.
According to Nosi, Pucci, Silvestri and Aquilani (2017), the functionality of cars that use electricity as the main resource for work may be too complex for individual markets, and the high cost of such equipment can repel potential investors and make it difficult to promote this category of goods. In order to address these challenges, the authors offer to pay attention to those companies that are involved in green activities and set themselves the goal of saving energy consumption as one of the main criteria of successful entrepreneurship (Nosi, Pucci, Silvestri & Aquilani, 2017). In this case, the search for investors can be simplified, and there may be more investors to purchase the business in question.
As an additional strategy of finding purchasers for the start-up project, a temporary test mode may be offered. This business cannot exist without the promotion of electric vehicles in the target region. Therefore, as a potentially successful sales programme, cooperation with local companies may involve the developers’ participating in the supply of respective cars. This type of mediation tactics can strengthen partnerships and, in turn, enable business buyers to test the convenience of the sold technology.
Consumer Purchasers
When entering the Russian market, one of the main advantages for CYC is a low competitive barrier, which may allow the project developers to monopolise this industry and create consumer interest due to the uniqueness of their proposals. Zhgulev, Bozhuk, Evdokimov and Pletneva (2017) consider the example of the aforementioned Tesla corporation and note that due to the rapid gain of market recognition, the company has managed to build a positive reputation, which, in turn, creates challenges for new market participants and requires them to overcome the threshold of customer loyalty.
Provided that the electric transport industry is not developed significantly in the region under consideration, engaging the target audience through profitable offers and bonus programmes can help build a stable customer base. This prospect is real if competent marketing steps are applied, for instance, discount offers, sponsorship awards and other features of customer loyalty projects.
Many potential customers may not be ready to purchase CYC products due to the fact that this brand is unknown in Russia. In order for establishing a stable sales network, it is crucial to offer consumers an opportunity to find out all the necessary data about both the project and the products proposed. As Tuan, Karpukhin, Terenchenko and Kolbasov (2018) argue, many automobile concerns have been operating for a long time in the Russian market and have a wide client base, for instance, Toyota.
As a strategy for involving customers, CYC representatives should create a support service with qualified specialists who can answer buyers all their questions and help with purchases. Moreover, this mode of operation may be utilised as a method of collecting valuable data on target consumers. According to Zhgulev et al. (2017), young purchasers tend to buy these products more willingly. Therefore, this information should be used with benefit, and a public attraction programme may be developed through effective marketing solutions.
Key Sales Propositions
As key value propositions, it is proposed to promote the convenience and functionality of CYC in the Russian market. The cost of these products cannot be extremely low due to the unique capabilities and innovative nature of the goods in question. In order to push potential buyers to purchase such developments, Bohnsack and Pinkse (2017) suggest applying “several tactics to decrease the negative perception of the high price, such as warranties, initial price reduction, and payment constructions” (p. 86).
Nevertheless, these incentives may not be enough to engage a large number of consumers. Therefore, in addition to a competent pricing policy, the promotion of CYC should be based on the practical importance of the product in a modern digital environment due to the demand for such functionality in the world market. Competent advertising involving the distribution of the goods to a wide range of consumers is an essential part of the sales programme.
Another significant nuance that may be utilised as an element of a value proposition is coupling tactics. Bohnsack and Pinkse (2017) analyse this principle of promoting electric vehicles and give examples of Tesla, BMW and some other concerns that have used this strategy. This approach is similar to that of corporate social responsibility when business companies are involved in important activities that can benefit people and the world in general. For instance, the image of a project with an environmental focus implemented through cooperation with green companies may allow CYC to interest people who are concerned about the depletion of natural resources and the detrimental effect of traditional machines on the ecology. This type of value proposition can also be seen in the context of a potentially successful promotion strategy.
Competitive Threats
The key aspect regarding possible competition that CYC representatives should take into account when promoting their project in the Russian market is the audience’s unwillingness to change old cars with internal combustion engines to modern electric models. As Safari (2018) states, the confrontation between these two types of vehicles is long and stubborn, and despite natural progress in the transport industry, the abandonment of non-traditional cars is characteristic of many world regions.
In order to overcome this barrier, CYC should expand the knowledge of potential investors and consumers about the merits of such models and the equipment offered, thereby ensuring higher sales. Otherwise, the predominant number of car owners will not be ready to give way to a modern car with convenient functionality and a more progressive system of movement.
In addition to the fear of innovations, the threat of competition suggests the danger of Tesla’s active work as the largest and well-known supplier of electric vehicles and their components. Safari (2018) notes that this corporation conducts successful marketing programmes and offers customers a wide range of services. Also, as the author remarks, the company manages to promote its products successfully even despite higher prices compared with those of competitors, and this advantage is achieved due to high brand value and customer loyalty (Safari, 2018).
Therefore, the rivalry with Tesla may become one of the main threats for CYC at the stage of introducing products into the Russian market. In order to avoid problems and the loss of profit, the developers of the start-up project should expand the range of services and take into account the limited possibilities American corporations’ activities in the region under consideration. In case of successful tactics, CYC products may become a leader in this market due to more loyal sales conditions.
Required Product Innovations
Despite the unique options that CYC offers, some additions can be made to this system to expand its functional potential and increase sales. For instance, Jensen, Cherchi, Mabit and Ortúzar (2017) note that there are a large number of stations offering fast recharge services for electric batteries. As an effective innovation, the localisation of these points in the application could allow customers to navigate faster and give preference to the stations of the brand in question. It is essential to not only add specific points to the map but also indicate the available options. This will provide an opportunity to increase sales through comprehensive information about the services provided.
Another valuable innovation is the option of delivering charging equipment to the place of order. Despite a potentially wide range of coverage, in the Russian market, electric car stations are represented in small numbers. Therefore, in order to help customers to simplify the mode of the operation of modern vehicles, CYC can offer the service of delivering a station to a specified address. This option may be temporary because, in case of successful sales, many new stations will appear in the country. However, at the initial stage, clients will see that the developers of the product are interested in sales and will appreciate the customer-oriented service of CYC.
Priorities for CYC
To start, CYC representatives should find partners who can help implement the start-up programme successfully and enable this innovation to enter the Russian market. In this context, one of the goals is to establish cooperation with the Skolkovo Innovation Center, the research complex that, as Kılkış (2016) argues, is the country’s leading provider of modern technologies. Since this community is funded by the government, an official presentation of the project is necessary in order to attract the attention of interested parties, thereby increasing brand awareness. All these procedures are aimed at creating a sustainable background for the introduction of CYC in the Russian market.
Another priority area of activity is the elimination of potential competitors. Despite the fact that Tesla is a world-renowned trademark providing services for the supply and maintenance of electric vehicles, its representation in Russia is not as large as in many other countries. In case the trust of business officials for CYC is obtained, this will be a significant driver of success. According to Kılkış (2016), the Russian authorities are ready to provide grants to potentially successful projects, and in the conditions of relative market freedom, the effective implementation of initial introduction plans can help eliminate the main competitor. The two priorities considered are key at the initial stage of work.
Conclusion
The considered conditions for introducing the CYC project into the Russian market with an assessment of threats and potential growth opportunities make it possible to draw up an objective development plan for this start-up and compile a potentially successful implementation strategy. Partnerships and the elimination of competitors are the most significant tasks that need to be promoted in the business environment of Russia, which is not ready for total innovations.
Both price and social value propositions can be relevant, and cooperation with green companies is one of the methods to attract attention to the brand. Some product innovations may be required, but in case of improvements in the programme’s functionality, consumers will be able to appreciate the customer-oriented approach of CYC developers and will be more willing to purchase this product.
References
Bohnsack, R., & Pinkse, J. (2017). Value propositions for disruptive technologies: Reconfiguration tactics in the case of electric vehicles. California Management Review, 59(4), 79-96.
Cheong, T., Song, S. H., & Hu, C. (2016). Strategic alliance with competitors in the electric vehicle market: Tesla motor’s case. Mathematical Problems in Engineering, 2016, 1-10.
Jensen, A. F., Cherchi, E., Mabit, S. L., & Ortúzar, J. D. D. (2017). Predicting the potential market for electric vehicles. Transportation Science, 51(2), 427-440.
Kılkış, Ş. (2016). Sustainability-oriented innovation system analyses of Brazil, Russia, India, China, South Africa, Turkey and Singapore. Journal of Cleaner Production, 130, 235-247.
Nosi, C., Pucci, T., Silvestri, C., & Aquilani, B. (2017). Does value co-creation really matter? An investigation of Italian millennials intention to buy electric cars. Sustainability, 9(12), 2159.
Safari, M. (2018). Battery electric vehicles: Looking behind to move forward. Energy Policy, 115, 54-65.
Tuan, N. K., Karpukhin, K. E., Terenchenko, A. S., & Kolbasov, A. F. (2018). World trends in the development of vehicles with alternative energy sources. ARPN Journal of Engineering and Applied Sciences, 13(7), 2535-2542.
Zhgulev, E., Bozhuk, S., Evdokimov, K., & Pletneva, N. (2018). Analysis of barriers to promotion of electric cars on Russian market. Engineering for Rural Development, Elgava (Latvia), 17, 2110-2117.