Group Project Report: Marketing Strategy For Glovo App: Students
Group Project Report: Marketing Strategy For Glovo App: Students
Group Project Report: Marketing Strategy For Glovo App: Students
Lecturers:
Fabrice Desmarais
Huw O´Connor
Students:
Minghao Kong (ID: 1333868)
Mercedes Isasmendi E. (ID: 1354305)
Aditya Kadam (ID: 1361974)
Zhengyu Kang (ID: 1297732)
Jessie Krippner (ID: 1234929)
Devanshi Kiri (ID: 1354385)
Contents Page
References Page 24
Appendix Page 26
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List of Illustrations
Illustration Page
Fig. 1: Glovo App Overview Page 5
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Executive Summary
This report details a full marketing plan to introduce GLOVO App on the New Zealand
market. It will include an extensive analysis of the existing market and the external
context that will determine the success of the business in the new market. Then, after
identifying and analyzing the company's resources, skills, opportunities and strengths,
the report will focus on the segmentation process, the target market and how to develop
a marketing mix strategy to create a competitive advantage in the minds of the selected
targets. Finally, with two specimens of communication, we will illustrate our brand and
how we deliver the message.
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Glovo will be launched in the main cities of New Zealand, where kiwi high life quality
could be threatened by the increasing size and population of its main cities. In addition,
e-commerce, m-commerce and delivery services are increasing dramatically as a
response in changes of lifestyle of New Zealanders, who are also following similar
worldwide trends.
Early adopters will be mainly busy professionals and students, but once established,
retired people and busy parents will also benefit from our application. Our strong
financial resources, highly trained team, success factors in previous markets and
continuous improvement and collaborating culture, will help us to firmly stand in this
new market and to face our competition with confidence.
In order to reach our selected targets, our IMC will be based on a Pull/Push
communication strategy with a strong emphasis on Advertising, Sales Promotion and
Personal Selling in the first stages. Direct marketing will be important on later stages.
After doing all the extensive analysis, our team will recommend the company to focus
on three main actions. First, to start partnering with key players of the food industry
which are already working with the company abroad and to work hard to design a
convincing strategy to partner with The Warehouse and Trade Me. Both kiwi brands
have delivery limitations and Glovo can definitely be a key player for them. Second, we
recommend focusing the advertising campaigns on telling the story of the company, and
to teach users about the benefits of this application, and make them understand how
the App can add value to their lifestyles. And finally, due to a potential shortage of
Glovers, specially at the beginning, the company will have to hire personnel until the
brand gets strong enough to attract and generate its own independent Glovers.
Marketing Strategy
More about Context and company overview
Glovo was founded in Barcelona in 2015, and during its first year, the company
operated exclusively in Spain. But after closing a second round of investment of 2
million Euros and acquiring the Italian company Foodinho, the start-up began its
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international expansion (O´Hear, 2016). Today, Glovo has a strong presence in more
than 21 Spanish cities, while worldwide, it is operating in 61 cities in 17 countries (Ohr,
2018). The brand is strongly positioned in Spain and other European countries, as well
as in Latin American countries. For example, by the end of 2017, the firm started
operating in Argentina, and in less than 6 months reached 60000 deliveries
(PulsoSocial, 2018).
In the last founding round in July 2018, the company secured 115 million Euros.
AmRest, which controls over 1,650 restaurants in more than 16 countries with brands
such as KFC, Pizza Hut, Starbucks and Burger King, invested 25 million Euros,
becoming a co-lead investor holding 10% of total number of Glovo shares (Dybińska,
2018). This data shows that the business is promising and is determined to strengthen
its international growth.
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Figure 2: Key Success Factors
New Zealand is well-known for quality of life. According to the HSBC's 2017 Expat
Explorer survey, the country ranked sixth in the world for work-life balance (New
Zealand Now, n.d.). This means that people living in the country prefer a relaxed pace
of life, avoid long commuting hours, and invest their time with family, friends or doing
leisure activities. Due to this, and also following international trends, e-commerce will
continue to grow and will likely become as important as traditional shopping. Online
sales in New Zealand are just over 8% of total retail sales and are predicted to rise to
just under 18 per cent by 2021. By 2026, 83% of kiwis will be shopping online (NZ
Herald, 2018). This data indicates that retailers will have to find new ways to respond to
this trend. The Glovo app is an attractive response to changing behaviours that
simplifies lives by saving time otherwise spent traveling around the city.
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Situation Analysis
1. External Analysis: PEST/ Context
Political factors
A stable government is essential for any business to operate successfully in any
country. It ensures a favourable political environment which can be beneficial for
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business. The political environment in New Zealand changes every three years with the
formation of the new government. New Zealand is one of the world’s most stable
democracies (Stability and Security|Invest in New Zealand|Nz Now, 2018). The new
government makes changes in the rules and regulations especially pertaining to labour
laws and labour force and it is important for businesses to be aware of these changes. It
is also important to identify weather the changes are favourable to do business in New
Zealand. Labour laws are strict and labour force is expensive in New Zealand. Also, the
lending rates are high which means the company has to pay more taxes, so the
company will have to reconsider its profit share while operating in New Zealand. Overall
New Zealand offers great amount of freedom to business and trade which makes it an
ideal market to launch Glovo (Adamksai, 2016). Road safety is an important issue in
New Zealand and Glovo will have a responsibility to their Glovers that if unmet will
negatively affect their business.
Economic factors
Glovo is a service app that operates using the principles of a gig economy. In a gig
economy individuals are hired by organisations on contractual basis but only for a short
period of time. The gig economy concept has been gaining momentum in New Zealand
(NZ Business, 2017). This will be an opportunity for Glovo as it provides great
employment opportunities to individuals who are willing to work independently without
being bound to long term contracts to the employer. But this also has a long
disadvantage as it does not give job security to the individuals which can be risky to the
economy. Glovo’s closest competition in New Zealand Uber Eats has faced issues with
parking and delivery timing in Auckland as it tried to expand its business to meet
increasing demand.
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sedentary lifestyle and are adopting grocery delivery services and similar. There are
numerous local and international students studying in different institutes and universities
across the country. 18-24 year-olds make up 1.44 million of New Zealand’s 4.7 million
people. Glovo can provide employment opportunities for youths looking for flexible work.
Legal factors
As businesses in New Zealand have started to employ workers on short term contracts
it has caught the attention of the New Zealand government pertaining to labour laws
and regulations (NZ Business, 2017). Employment and labour laws are very stringent in
New Zealand and they are well protected. There are cases where employees have
been exploited in the form long working hours, less remunerations etc due to short term
contracts. Also, businesses in New Zealand will have to pay higher amount of taxes as
a part of their legal obligations. Uber has been under scrutiny for violation of labour laws
and licensing in many countries due to its policies of hiring drivers on contractual basis
which overlooks the laws.
Technological factors
Increasing digital business has also fostered demand for delivery service apps in New
Zealand. People and businesses are more inclined towards modernisation and want to
use technology. Glovo will provide great technological advancement to businesses and
people who are looking for fast paced services of any kind.
Ecological factors
Protecting the environment is one of the major priorities of the New Zealand
government. When Uber launched in New Zealand it was estimated that it would
increase traffic congestion and increase pollution on the road, especially in populated
cities like Auckland and Wellington. The estimation proved be to incorrect in both cities.
However, as Glovo uses mainly bicycles and motorcycles for the deliveries, the impact
on the environment and the generated pollution will be very low.
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2. Internal Analysis: Category and Competition
New Zealand has become one of the fastest growing takeaway markets in the world.
The New Zealand takeaway delivery market is expected to grow by 6.7% annually,
which is far higher than the dine-in and pick-up takeaway markets (Nichol, 2017).
UberEats and Deliver Easy are strong competitors for Glovo. In 2017, UberEats began
to operate in New Zealand, and due to increasing demand, the company expanded
across Auckland into New Lynn, Takapuna and Onehunga. UberEats and Deliver Easy
occupy most of the market share in food delivery in New Zealand. Their delivery speed
and efficiency is very high. UberEats may be more stylish, but Deliver Easy’s service
quality is comparable. All in all, the commonality is that their market positioning is the
distribution of food, rather than the distribution of other goods.
In the competitive risk aspect, New Zealand food delivery market space is very
crowded, with the likes of Deliver Easy, UberEats competing to conveniently serve
consumers’ stomachs in New Zealand. UberEats will likely orchestrate a take-over.
Then, when restaurants find that 30-40% of their sales are through UberEats, UberEats
will probably suddenly raise either their cut from the restaurant or raise delivery prices
sharply, and restaurants will have no choice and have to compromise. UberEats
dominated the Auckland market, and Deliver Easy business had grown in Wellington
where it started in 2016. In 2017, for thousands of New Zealanders, food delivery has
become synonymous with UberEats as customers love it for its simplicity and
convenience (Nichol, 2017). UberEats services are expanding, with more customers,
more orders and more restaurant partners in New Zealand. By July 2017, the service
had more than a hundred restaurants on its platform and delivered far beyond
Auckland’s cluster of central city suburbs. By October 2017, it spread to Christchurch.
And by September 2017, UberEats expanded to Wellington which added fresh
competition to a relatively new market (Junn, 2017).
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Figure 4: Positioning Map
As a delivery platform, Glovo offers to ‘shop on your behalf’. It allows users to order
anything according they need and guarantee delivery within minutes. This includes such
goods as food, electronics, and medicine. Glovo App can connect users with
independent couriers to send urgent packages. This is what differentiates Glovo from
Delivery Easy and UberEats.
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3. Internal Analysis: Company and Potential
Collaborators
Glovo has been able to succeed in its home market and in international markets too,
due to its core resources. Among them, the most important are:
● Key investors supporting the product. Today, the company is well
positioned worldwide, and in its last round of funding it raised 115
millions of Euros (O´Hear, 2016). This solid base supports entry
into future markets, like New Zealand, which is valuable for
businesses who want to partner with us.
● High qualified employees. For example, Sasha Michaud, a well
known expert in digital business startups, is Glovo´s co-founder and
specialises in strategy. Or Niall Wass, a former Uber SVP who has
been working as advisor for Glovo, has just been nominated for
chairman (O´Hear, 2016).
● A wide network of business partners. More than 3000 partners are
already working with Glovo around the world. They cover the
different needs that customers have. This element of the company
will inspire trust and confidence from potential partners in New
Zealand. Some even have franchises operating in the country, like
McDonald's, KFC, Target and Starbucks.
● An expert marketing team especially focused on PR and social
media promotion and our specialized IT team that is focused on
App improvement.
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Skill Set
The following chart shows the most important skills that the company has to succeed in
new markets.
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4. Internal Analysis: Potential Customer Segments
Customers with different behaviour will have different needs. If Glovo has an improved
understanding of the nuances of their customer behaviour, then Glovo can accurately
direct their marketing. Resulting in more targeted, cost-effective messaging and greater
investment return. The main method used to segment the market is Geo-demographic,
and it is detailed in the following picture:
1
Therefore, according to this graph our customer base is divided into 4 segments :
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Note: see Personas Templates in Appendix.
1- Tertiary Students
This group of people form a considerable proportion of customers and are likely to
become long-term users. Most of them are low-income people and even have no
income. Their age is normally between 18 and 24. Vehicle ownership is impractical and
expensive to this group. What they need to send is usually daily necessities, study
materials, or food. They will have a lazy attitude, so they will be willing to use this
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service as long as the price is acceptable. Their time requirements are not strict and do
not require very fast and timely delivery services.
2- Busy Professionals
This group of people generally have a healthy income, but they have long working
hours. They are between the ages of 25 and 45. They are educated and pursue a high
quality of life. This type of person will be the main customer base of Glovo because they
understand that time is the only asset that won't depreciate with the years. Due to that,
they can save time by spending a reasonable price on Glovo.
3- Retired elders
This group of people is generally over 60 years old. This type of person does not
occupy a large proportion because they are slow to accept new things, and some do not
even use smartphones. Failing vision may prohibit them from using the app directly. But
this group have many needs that can be met through Glovo. The goods they mainly
transport are alcohol, medicines, and daily necessities. They are a group of people who
are eager to be valued and respected.
4- Busy parents
This group, composed mostly of women, is between the ages of 26 and 40. They have
more than two children. Their time is consumed with childcare and housework. They
need to meet the daily needs of their families, such as children's daily necessities and
stationery, etc. Most of the time they need to stay at home to take care of their baby.
Children's supplies are often urgent, such as milk powder and diapers. Glovo can solve
a lot of their problems.
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5. Internal Analysis: SWOT
Target Market
While there are several distinct segments appropriate for targeting, there is not a single
ideal market. The market for this service will be characterised by multiple segments that
seek the same functional benefits.
While for some this service could be for providing access, this service will primarily
address a market that prioritises the functional benefits of saving time, avoiding hassle
and reducing effort. However, there are elements of self-transcendence present in the
way that Glovo supports community businesses. Early adopters will also feel pride in
being forward-thinking.
This service will target four main user groups. These are defined by how their lifestyle
interacts with the value propositions of Glovo. These groups find similar value in having
products delivered to their residence rather than going out themselves. Segments
outside of these are likely to find Glovo's value proposition unappealing because they
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are mobile and time-rich. The lifestyles of our target segments relate to demographic
segmentation, but other identifying characteristics are also present.
The first will be those who are likely to have an income but unlikely to have full licenses
and full vehicle access. This user group is comprised of young people who are likely to
be new tertiary students. The appeal of reducing effort will be important to this group.
The second will be those who have an income that stems from a demanding
occupation. This target group are likely to have full licenses and full vehicle access.
However, they are likely to be under time constraints. This user group will find most
value in saving time.
The third user group is likely to be retired and may no longer have licenses to drive or
vehicle access. They are also likely to have trouble with mobility in general. This user
group is likely to be smaller than the other two, but will find higher order value in Glovo's
services through the benefit of providing access. While it could be assumed that older
individuals might be estranged by Glovo because it is a service that relies on the use of
smartphones, the pervasiveness of devices cannot be underestimated. Also, particularly
for the third user group, the end user may not be the customer that deals directly with
Glovo.
The fourth is busy parents. These users represent households. The needs of three or
more people will be expressed by a single user or pair of users. Appealing to this group
means appealing to their desire to be, or self-concept as, great parents.
Positioning Statement
“For students and busy professionals where time constraint is an issue in their lives,
Glovo App comes as a solution because it is the unique online platform among all
delivery services that will help them simplify their lives in a fast and affordable way,
because it allows them to shop around the city, and send whatever their want without
the need of moving from their houses.”
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Marketing Mix
Place
In New Zealand, it would be covering major cities; Auckland, Wellington, Hamilton and
Christchurch. This decision follows a deep analysis of the context of these cities, similar
to the ones where the App is already functioning. These cities are busy cities, with many
gastronomic offers, as well as a wide variety of shops who will find a competitive
advantage to work with Glovo.
In addition, these cities concentrate the majority of the total of students enrolled in
tertiary institutions across New Zealand.
As our product is digital, our distribution channel is based on our users rate of app
download. We will work with App Store and Play Store to offer the product and promote
it through those platforms.
Product
The Glovo App connects users with independent couriers and allows them to acquire
products from anywhere within the city. This application’s "anything" delivery option
makes it possible for users to deliver "anything". This will satisfy the needs of our
customers who have time difficulties in their lives. The benefits of our service go beyond
the app, because our extended product, including social media interaction and excellent
customer service will magnify the user's experience.
Price
Once positioned, Glovo will have flexible workforce which will allow our customer a
policy of no minimum order. The pricing would be dependent on the distance a Glover
travels, the time consumed to pick up the product, and how many Glovers are available
at that moment. In addition, due to commissions charge to our partners, we will be able
to transfer part of our revenue to our delivery fees. This will be attractive for our
customers who will always be seeking for price advantages.
The application will be free to download will not include upgrade costs.
Promotion
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Glovo’s print promotion would be done through creative posters and print material at
universities, bus stops and partnered shops and restaurants. Other traditional channels
such as Radio and TV will also be used for promotion. Glovo will also create sales
promotions to promote loyalty. Email will also be used to strengthen connections with
customers. Strategic partnerships will be necessary.
Glovo believes in the possibility for thriving local business and flexible work for their
couriers. The business seeks to fulfill these through the functional benefits of their
service. Glovo makes affordable courier options available to small businesses through
their app and makes their Glover positions open to those seeking flexible work. These
two things are connected by the demands of their end users who order goods from
small businesses and receive their products from Glovers.
This brand acts primarily within the magician archetype. This is because they offer new
ways to do familiar things and offer a high degree of variety in their services. The brand
could also use the associations with innovation from the creator archetype and even
some associations from the caregiver archetype to round out their brand image. The
caregiver archetype will resonate with customers that care for children or elders and
encourage them to use Glovo to meet the needs of those they care for.
Glovo's brand symbols are bright and imply innovation and enthusiasm, which is
important to such new services. The colour scheme from Glovo's activity in other
countries can remain unchanged as the colours do not currently have another strong
association to compete with. The Glovo icon is simple to recognise and easy to
reproduce.
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INTEGRATED MARKETING COMMUNICATION MIX
The IMC mix is a combination of a “pull/push” strategy because in the early stages of
business in New Zealand, it will be necessary to work with retailers who will help us to
create awareness of our App. This, combined with a strong advertising campaign, will
“push” our customers to download the App and start benefiting from our service.
In later stages, we will mutate to a predominantly “pull” strategy, because our customers
will define how Glovo is used in New Zealand.
Starting with Advertising, the objective will be mainly informative and focused on
creating awareness through posters and brochures at universities to target students,
with posters in CBD and radio advertisements to capture the attention of busy
professionals and parents and with TV commercials to inform retired people about the
benefit of the Application. The campaigns will be based on a combination of flighting,
pulsing and continuous schedule.
Regarding to Sales Promotion, all the chosen elements, either loyalty programmes,
coupons or referrals, will mostly be oriented to engage and persuade users to increase
their use of the App. The frequency for them will be continuous and flighting schedule.
Moving to direct marketing, we will only be able to utilize emails and social media add
once we have created awareness and have a stable database. Due to its technological
nature, these elements will be pointes to influence mostly students, but also busy
professionals and parents with a continuous frequency.
To finalize, public relations and personal selling are key to work with the government,
media and business owners, with a continuous base reinforced at the beginning of the
company's operations.
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Synergy of the IMC Mix Elements
The sales promotion elements work together to incentivise trying the app, reward
repeated use of the app, and promote viral spread. The advertising elements work
together to promote habits by creating awareness of alternatives. Several advertising
channels (radio, retail posters, and bus stop ads) have been selected specifically to
offer alternatives to errand running in an appealing way while people are traveling to
accentuate the benefits of using Glovo through contrast.
Specimens of Communication
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warmth and positivity. The design is in small dimensions appropriate for putting into a
pocket. While initially appearing to be a simple card, the design mimics the form and
dimensions of a mobile phone when opened. Reading the communication mirrors the
beginning of an interaction with the Glovo app by taking the reader from the app logo to
the app landing page. This method of presentation was implemented to express the
ingenuity of the brand and engage recipients of the communication. The communication
is relatively informal and features a QR code to make follow up easier for recipients of
the message. This technology is likely to be easy for students to recognise and easier to
engage with than a printed web link. This communication informs recipients of the
message about the benefits that Glovo can offer and introduces them to the brand in a
friendly and approachable way.
This communication is designed for web display and signage. In this communication,
the Glovo balloon is formed out of Glovo branded boxes, like those that are carried by
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Glovers. This message is intended for transmission once the brand is more established,
because the contents of the communication are coded using concepts that require
some familiarity with Glovo in order to be understood. The aim of this message is to
remind users of Glovo’s benefits and maintain their awareness of the brand. This
communication also references the common saying ‘think outside the box’, but subverts
that message to reflect the value propositions of Glovo.
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References
Adamkasi. (2016). Pestel-Pestle Analysis of New Zealand. Retrieved from
http://freepestelanalysis.com/pestel-pestle-analysis-of-new-zealand/./
Dybińska, K. (2018, July 18). AmRest hospitality to spend EUR 25 mln on 10% stake in
https://search-proquest-
com.ezproxy.waikato.ac.nz/docview/2071042039/fulltext/28FCFFA9A82645E6PQ/1?account
id=17287
Edmunds. S. (2017, July 19). UberEats faces logistical challenges in Kiwi market.
Retrieved from
https://www.stuff.co.nz/business/94899105/ubereats-faces-logistical-challenges-in-kiwi-
market.
Jihee, J. (2018). The app that swallowed Auckland: UberEats, one year on. Retrieved
from https://thespinoff.co.nz/business/26-02-2018/the-app-that-swallowed-
auckland-ubereats-one-year-on/
https://www.newzealandnow.govt.nz/why-choose-nz/balanced-lifestyle
Nichol, T. (2017). More Kiwis ordering in as apps like Uber Eats' popularity soars.
Retrieved from
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11937393
https://nzbusiness.co.nz/article/gig-economys-benefits-and-risks.
NZ Herald. (2018, September 14). The secrets of online shopping. Retrieved from
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https://www.nzherald.co.nz/goodman/news/article.cfm?c_id=1504479&objectid=121232
08
glovo-acquires-italys-foodinho-to-expand-on-demand-delivery-service/
Ohr, T. (2018, July 18). Barcelona-based Glovo secures €115 million Series C funding
startups.com/2018/07/barcelona-based-glovo-secures-e115-million-series-c-
funding-to-strengthen-its-international-growth/
Pulso Social. (2018). Glovo llega casi al millón de pedidos en todos sus mercados y se
llega-casi-al-millon-de-pedidos-en-todos-sus-mercados-y-se-afianza-en-
argentina/
Glovo. (n.d.). Glovo: Delivery from any store - Apps on Google Play. Retrieved from
https://play.google.com/store/apps/details?id=com.glovo&hl=en_US
Glovo. (2015, February 11). Glovo on the App store. Retrieved from
https://itunes.apple.com/es/app/glovo/id951812684?l=en&mt=8
https://blog.glovoapp.com/2015/11/05/el-nuevo-glovo/
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APENDIX
IMC MIX
Print ads in shops’ All customers All the year Informative: Create
doors/walls (Continuous awareness.
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schedule) Communicate
customers that they do
not need to go to those
shops for buying their
necessities and that
they can order them
with the App.
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Public Highly trained PR Media, Continuous Build and maintain
Relations personnel government, schedule: all image. Monitor
other the year. opinions,
stakeholders More intense complains.
if required.
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CUSTOMER PERSONAS
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30