The Most Common Mistakes Companies Make with Global Marketing
Order Instructions:
Choosing 2 articles that provided in the files and follow the instruction to write 1000 words per article.
SAMPLE ANSWER
Case Studies
Article 1: The Most Common Mistakes Companies Make with Global Marketing
Question 1
The article talks about marketing at a global perspective. It mentions the significance of marketing when it comes to the point of a company seeking to expand in a global manner. The article clearly illustrates the significance of the marketing team when such a time comes for a given organization, firm or company.
In the current world we live in, small enterprises usually want to go largely by venturing into the global market. Doing business on a global scale is not an easy task. The article demonstrates that if a business organization seeks to expand and enter the global market. The organization needs to have two things. The means to expand in a global way. And secondly, a good team of marketers that will ensure that the company is known in a given market as soon as it branches out to that specific geographical location. Although the article focuses on the aspect of marketing.
The author of the article gives his insights on what he knows about marketing using the experience he has in the given sector. He goes on to show that marketer is doing things the wrong way. The article goes further to articulate the wrong doings by marketers and the implication of their wrong doings. The author also gives clear examples and illustrations that vividly explain the situation regarding marketing at a global scale. Therefore, marketing on a global scale is the main idea being discussed in the given article.
Question 2
I tend to agree with the author that as far as the global market is concerned. Most of the marketers are using the wrong approach in tackling the marketing situation. For instance. Instead of the marketers specializing in a given area. They end up categorizing a given section of the market in a way that will not give the specific attention to a given nation. This is surely a recipe for disaster, and a company whose marketing team is making such strategic choices is doomed to fail in the global market. The author is correct to say that the markers should give special attention to a given section of the global market.
Considering that each section has its unique attributes that define the consumer behavior in a given area. The need for specialization becomes very crucial. Therefore, such an approach should be used to tackle different nations in a different and unique manner that is specific to the nation in question.
Another issue on which I agree with the author is that marketers need to understand that different markets need different approaches to marketing and sale. A company cannot use the same game plan that made it attain domestic success at a global marketing perspective. Therefore, each market region should be researched, understood, defined and then marketing can be done according to the information acquired from the research.
Lastly, I tend also to agree with the author on one more issue. The idea that one product was successful in a given market region will not ascertain the success of the same product in another market. Therefore, as it is mentioned in the article. It is wise for the company to adapt their product offerings to conform to the consumer needs of that specific market region.
Question 3
The article can be quite a learning point to most marketing teams that face a challenge in understanding the dynamics of the global market. It is paramount that some of the key points in the article are provided for use by these marketers. There are at least four key points that would help a marketer become more informed on the global approach to marketing.
One of the undisputable facts that have been mentioned in the paper includes the fact that a product that has been successful in a given market niche cannot necessarily be successful in other totally different regions. The above point can be comprehended well if all the factors to consider are elaborated in a simple but clear manner.
Culture is one of those significant factors that are considered in approaching a given foreign market. For instance, different nations have different people inhabiting them. However, sometimes the cultures may differ while at other times they may concur. Hence, if a product that was successful in country A is introduced to country B. the product will not be perceived well by the market in country B. Therefore, it may not be successful. However, if the product is altered, modified and even completely changed to adapt to the market in country B. Then it will receive a positive perception.
Question 4
The author of the article in question has given quite a handful of significant advice on specific marketing strategies that help in dealing with the global market. However, what the author did not eventually make complete in this article is the implications that these marketing strategies have for a given marketing team that chooses to follow the given approach. Therefore, let’s discuss the implications of these strategies. Lets start with the first strategy of specifying nations when approaching a global market with an aim to succeed in marketing. Every nation has a different set of people with different culture and other factors that are crucial to marketing (Gordon, 2012). Hence, for a successful marketing campaign. A product should be modified in a way that it is in line with the unique characteristics or behavior of consumers in a given nation. This would give the product a competitive advantage over their competitors who used a totally different approach. Secondly, a product profile should be by a nation’s rules and policies (Boon et al., 2015). Considering that every country has a set of different rules. The organization needs to take all that into consideration for business to go on as usual. Therefore, marketing is an involving discipline in business that requires high specialization and adaptation upon thorough research of a given market region.
Article 3: Games Can Make You A Better Strategist
Question 1
The article talks about how games can be used as tools for to be a better strategist in every business decision an individual makes. In the past, games were not associated with strategic thinking. By recent research has shown that a person who uses games to develop their thinking strategy-wise has a better chance of further developing strategic decision-making skills that save time and effort and provide the desired result. The article goes on to describe how effective a game can be in nurturing talent in the workplace. In the current age of technology we live in. Games have become so popular due to the numerous apps that have been created to be used on smartphones.
There has never been an easier way to play games than on a phone. Therefore, as stated in the article, games can be quite an interactive way for an employee in a certain business organization to develop their analytical and problem-solving skills. This would eventually give the organization a competitive advantage due to the competitive edge brought about by the use games to explore the world of strategic thinking in a more fun perspective. However, according to the author, things are not so good for this phenomenon. Considering that the younger generation will be wanting of this approach than the older generation of employees. Therefore, a barrier of interest is created. This barrier leads to the limited use of the approach to the development of strategic thinking. Where, it is only possible in some group of employees and not usable to another different group of employees.
Question 2
The author has clearly illustrated the point about games and strategic thinking. The article has some truth to it. However, some parts are misguided elements. The truth is contained in the fact that games can improve your thinking capacity, especially strategic thinking and decision-making capabilities. The significance games can then be understood remotely by reading the article. However, games at times act as distractions that may take away the seriousness in the work environment.
Moreover, games become such a nuisance once everyone is playing them in the workplace. Furthermore, they lead to wastage of scheduled time that is important for the conduct and attention of another important process that happen in a given organization. Consequently, I agree that games are a good tool.
However, they need to be used appropriately ti be useful in an organization. They can be very useful tools if they are used in the following ways. Let there be a forum for strategic thinking in which all employees will attend. This forum may involve different tactics used ti train individual to be critical and strategic thinkers. A game like chess is a very beautiful and useful game. This game calls for a keen for mistakes and opportunities to recover what is lost from the mistake. Therefore, the use of a game such as chess will surely help employees in an organization turn out to be good players in the game of chess and the game of business.
Question 3
The lessons learned from the article must be looked at from a positive perspective. It is not the custom for employees to keep playing games after they have entered the workplace. This would result in lowering of employee performance. Moreover, different types of games exist in the world. Due to the current technology. People can share the high score of a given game. To effectively use these games in an interesting way that would capture almost all the employees. Some factors need to be considered
One is the age factor; most aged people do not play games, except Golf sport. However, it is clear that their interests are laid somewhere. Therefore, it leaves us the young lads to lead the project. Therefore, the young lads may be the key to the hidden potential; of strategic thinkers among themselves. Each game should have its purpose so that the employees know how they are playing a game to achieving a given skill at the end. However many games help in developing the thinking capacity of given individual.
It can also be a demeaning activity. Which gives a reason as to why such a game should not be conducted. This would help in a big way. Considering that games also relieve stress, they can be used appropriately by ensuring that they are played at scheduled time and with different people to experience and interact with other human beings like you.
Question 4
The strategic implication of a game in marketing can be quite a helpful. For instance, playing a game to find out if there are regions in the world that have similar cultures that will give the similar consumer behavior towards a certain product (Proctor, 2014). The whole point of strategic marketing is to have a given competitive edge over your competitors. To achieve this, games can be used as a strategic planning tool and marketing tools to help understand different aspects of marketing in the correct manner and use this information to the advantage of the organization in question.
Another important application of games in the workplace would increase the level of research dome into the various market region (Gordon, 2012). The information obtained will be valuable if not important. The importance may come after the marketing team has come together and discussed the information. Hence, a game may be created for that particular decision-making process. When the game gets played. The perfect situation is played out, and it is viable for use by the organization to conduct a certain marketing activity that is related.
References
Boon, B. T. L., & Liang, T. W. (2015). Firms’ Marketing Mix Effectiveness and Modes of Entry in the Host Countries. In Proceedings of the 1998 Academy of Marketing Science (AMS) Annual Conference (pp. 474-474). Springer International Publishing.
Gordon, R. (2012). Re-thinking and re-tooling the social marketing mix. Australasian Marketing Journal (AMJ), 20(2), 122-126.
Huang, R., & Sarigöllü, E. (2012). How brand awareness relates to market outcome, brand equity, and the marketing mix. Journal of Business Research, 65(1), 92-99.
Proctor, T. (2014). Strategic marketing: an introduction. Routledge.
West, D., Ford, J., & Ibrahim, E. (2015). Strategic marketing: creating competitive advantage. Oxford University Press.
Wilson, R. M., & Gilligan, C. (2012). Strategic marketing management. Routledge.
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submit an academic paper that covers the concept of distribution strategy. Choose Apple as the company to provide your analysis.
Your paper should discuss the overall distribution strategy of the company, clearly describe the distribution channels, and why you think the distribution strategy of your company of choice is effective and provides a competitive advantage.
You are to also provide possible alternatives to the companies distribution strategy in light of what you have learned thus far in the course. When providing alternatives, such should be well-founded, and based on appropriate research rather than simply stating an opinion without support.
SAMPLE ANSWER
Apple International’s Distribution Strategy
Introduction
Apple International provides services to a vast pool of consumers. These consumers come from sectors such as education, government, enterprises, and SMB markets. Therefore, there is reason to have a coordinated distribution strategy to ensure that products reach consumers efficiently (Mallin & Finkle, 2011). The distribution strategy used by Apple Inc. combines both concepts of marketing logistics and marketing communications. Therefore, the following discussion will indulge in discussing the distribution strategy used by the Apple Inc. in the move to make profits and achieve customer satisfaction. In addition, the discussion will give recommendations on how the company can best utilize its distribution strategy/channels.
Discussion
Apple Inc. is an American Corporation that deals with designing and marketing consumer electronics, personal computers, and computer software. It has the range of products ranging from iPad, iPhone, and iPod. Through its centrifuged marketing strategies, Apple Inc. has been able to make sure that its customers are satisfied beyond maximum efficiently (Mallin & Finkle, 2011). This correlates to the fact that the distribution medium used by the company ensures that products reach the consumer conveniently. Ina addition, the distribution strategy has enabled the company to create a unique reputation in the overall consumer electronics industry.
The distribution strategy used by the Apple Inc. is meant to counteract intense completion from such players as Google, Microsoft, and other companies (Rimac, Borst & Walid, 2008). In emphasis, the distribution strategy used by Apple Inc. is entirely a selective distribution strategy. This strategy ensures that the company gets the right medium for its distribution. It makes sure that the channel shows a complete combination of effective marketing communication and marketing logistics (Homburg, Vollmayr & Hahn, 2014). In addition, the selective distribution ensures that it exclusively limit market reach. Furthermore, the selective distribution strategy ensures that Apple Inc. control over distribution by authorizing sellers to sell on their behalf. Apple Inc. uses four distribution channels to reach its consumers. These channels range from online stores, retail store, direct sales force, and third-party wholesalers (Sahoo, 2012). The company distributes its products and resells third-party products to most major markets. This ensures that there is a direct selling of products to the consumers.
In addition, the company uses indirect distribution channels to reach its consumers. These channels comprehensively comprise retailers, value-added resellers, and wholesalers who are mainly third-party cellular network stakeholders (Sahoo, 2012). Both direct and indirect distribution strategies are characterized by pros and cons. All the distribution channels are meant to make the company continue to gain competitive advantages in the market. The company has some retail stores. The large network of stores gives the company a major advantage in the distribution (Rimac, Borst & Walid, 2008). Apple Inc. understands the preferences it customers clearly. Thus, its distribution channels are crafted to meet all brand-touch points. The company is increasingly improving its distribution capabilities by opening its retail stores in important cities around the globe (Sahoo, 2012). The retail stores have potential customers have direct experience of the company’s brands. The environment in the stores enables the customer experience a stimulating environment characterized by no-pressure setting that gives them opportunities to discover more about the Apple fraternity. The retail staff is composed of trained and helpful people whose enthusiasm lures customers to come and shop again at the stores. Homburg, Vollmayr & Hahn (2014) argue that distribution is an important ingredient of the marketing mix. It usually takes the place of ‘place’ in the mix.
Online store selling is another form of the direct distribution channel. Through online, there is no presence of intermediaries. The consumers are made to observe the product feature through the Apple Website. In addition, the customer requests and purchase the products selected through online (Sahoo, 2012). These channels are important became it is convenient and cost friendly on the part of the company. This is because it can induce the customer to engage in impulsive buying by just observing features of the products through online efficiently (Mallin & Finkle, 2011). However, this channel has been criticized by Sahoo (2012)to bring shortcomings due to a lot of unnecessary information on the websites that make the customers unable to purchase products and prefer to visit the stores themselves.
The company also uses retailers in the distribution strategy. With the use of retailers’, Apple Inc. ensures that the retailers buy smaller quantities of products from them (Sahoo, 2012). Therefore, this form of indirect distribution channels ensures that the presence of the retailers does not have many costs as compared to when both retailers and wholesalers are present. Using such retailers as Waymart And Best Buy, Apple Inc. is bale to eliminate the presence of wholesalers in the channels (Rimac, Borst & Walid, 2008). This ensures that products reach the final consumer on time, and at the same time, realizing the projected profits by the company.
To improve marketing communication, Apple Inc. uses telecom companies such as Verizon and AT& T to ensure that communication within the distribution channel is enhanced. All the four distribution channels are interconnected with various communication models efficiently (Mallin & Finkle, 2011). This ensures that an emergent information is communicated easily to the retail stores, online stores, retailer, and the wholesalers. It is observed that the telecom companies are also authorized to sell iPhone units.
The company is said to use third-party wholesalers as a part of the distribution strategy. The third-party wholesalers, used by the Apple Inc., offer products to consumers through their businesses. The company usually makes quality products. However, the third-party wholesalers sell these products independently (Samaha, Palmatier, & Dant, 2011). The Apple Inc. is responsible for manufacturing products before they are distributed to their wholesalers. The problem with this channel is that the customer cannot get experienced Apple specialists to assist them with their new products. This, therefore, forces the customers to opt to go to the direct stores where they can get the experienced specialist to advise them on how to use new products. Rimac, Borst & Walid (2008) as companies giving fulfillment services, refers the third-party wholesalers. Apple Inc. uses fulfillment services from firms such as eBay and Amazon.com for Apple Inc to sell their products. The third-party wholesalers ensure that consumers are not supplied by Apple-related products directly, as this type of distribution strategy make products be shipped at least two times (Chu, Chintagunta & Vilcassim, 2007). However, use of a third-party wholesaler is still a convenient way for Apple Inc. to reach its consumer despite the channel associated with certain drawbacks.
Lastly, Apple Inc. uses direct sales forces as one of the distribution channels. The direct sales force gives the customer an experienced technical staff. Observably, for instance, it is easier for a customer to buy two or more computers from Apple. However, it becomes difficult for a company to purchase, for instance, two hundred computers. Therefore, the direct sales force gives the buyers confidence that they are purchasing from the right distributors (Samaha, Palmatier & Dant, 2011). They deliver the purchased products to the buyer’s premises, in addition to providing consultations to the buyers on how to deal with software and hardware. Notably, the use of direct sales force is a direct form of distribution strategy.
Recommendations
Weaknesses of the selective distribution strategy used by Apple Inc are that it has a policy of exclusivity. This has been approved by the discussion above that Apple Inc. selectively authorizes sellers of its products. Yu, Cadeaux & Song (2013) warn that such an exclusive distribution strategy limits Apple Inc.’s market reach. The second and final recommendations to improve the distribution strategy of Apple Inc. are to ensure the indirect stores have specialized consultants. This move will decrease the number of people avoiding to purchase from the third-party wholesalers to go to the direct stores. Chu, Chintagunta & Vilcassim (2007) argue that congesting customers in one place do not mean improved profits when its subsidiaries have less number of customers visiting the places. Therefore, ensuring that the subsidiaries have consultants and other assisting agents, more customers will buy from the indirect stores thus improving services and services to the corporation.
Conclusion
In summary, it has been observed that Apple Inc. majors in using the selective distribution strategy. This strategy involves the company selecting its authorized retailers. This enables the corporation to leverage its functions. However, this strategy prohibits further market reach. Therefore, Apple Inc. needs to use an inclusive distribution channel to increase its market reach.
References
Chu, J., Chintagunta, P. K., & Vilcassim, N. J. (2007). Assessing the Economic Value of Distribution Channels: An Application to the Personal Computer Industry. Journal Of Marketing Research (JMR), 44(1), 29-41. doi:10.1509/jmkr.44.1.29
Homburg, C., Vollmayr, J., & Hahn, A. (2014). Firm Value Creation Through Major Channel Expansions: Evidence from an Event Study in the United States, Germany, and China. Journal Of Marketing, 78(3), 38-61. doi:10.1509/jm.12.0179
Mallin, M. L., & Finkle, T. A. (2011). APPLE INC.: PRODUCT PORTFOLIO ANALYSIS. Journal Of The International Academy For Case Studies, 17(7), 63-74.
Rimac, I., Borst, S., & Walid, A. (2008). Peer-assisted content distribution networks: performance gains and server capacity savings. Bell Labs Technical Journal (John Wiley & Sons, Inc.), 13(3), 59-69. doi:10.1002/bltj.20323
Sahoo, D. (2012). Strategic Change of Campaign at Apple Inc. Vidwat: The Indian Journal Of Management, 5(2), 38-48.
Samaha, S. A., Palmatier, R. W., & Dant, R. P. (2011). Poisoning Relationships: Perceived Unfairness in Channels of Distribution. Journal Of Marketing, 75(3), 99-117. https://www.doi:10.1509/jmkg.75.3.99
Yu, K., Cadeaux, J., & Song, H. (2013). Distribution Channel Network and Relational Performance: The Intervening Mechanism of Adaptive Distribution Flexibility. Decision Sciences, 44(5), 915-950. doi:10.1111/deci.12040
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Simmo’s Ice Cream is a company based in Australia established in the year 1992. It mainly deals with ice cream and related products. This report aims at establishing a good marketing plan. Therefore, the paper analyses the company fundamentals using SWOT analysis. On the same note, the paper analyzes the competitive advantage and market positioning of Simmo’s Ice-Cream Company. This report mainly concentrates on how the company can invest in product promotion with an aim of achieving competitive advantage over competitors and other key players in the market. If successfully implemented, this report would greatly assist for the future expansion plans of the company.
Introduction
Simmo’s Ice Cream is a company that specializes in the manufacture of various brands of ice cream. The company has made considerable profits through low production costs, providing quality products and by hiring employees that provide excellent customer service. They have created a new type of various flavors given the increasing market competition from several other companies dealing in the same line of business. It deals with various flavors that include dairy free, lactose-free vegan flavor and latest being Yahava coffee flavor. All this is mainly aimed at achieving customer satisfaction. As a matter of fact, there is increasingly changes in the customer taste and preferences and, therefore, need to meet the customer need and satisfaction.
Simmo’s Ice Cream enjoys a variety of a good customer base ranging from tourists, couples and families on holidays and also corporate partners. The ice cream company based in Dunsborough, Western Australia, has a long establishment history. Having been established in 1992, it has undergone considerable expansion process with their expansive market base. It has a large labor base with their employees going on recess during winter. The Simmo’s Ice Cream is mainly made from the locally available raw materials from scratch with the materials sourced from the surrounding areas of Dunsborough, Western Australia.
Strengths
· High investment on innovation
· Marketing through the internet
· Expert team of managers
· Equity in flavors and brand
· Efficient distribution and supply routes
· Good reputation from the public
Weakness
· Few customers and small market
· Few products and brands
· Low production during winter
Opportunities
· Foreign markets increase
· Innovation and new product development
· Sales and marketing through the internet
· New classes of flavors development
Threats
· Competition from other Ice Cream manufacturers
· Poor economic growth
· Changes in foreign markets and government policies
· Changing foreign exchange rates
· Price wars with other manufacturers
Competitive advantage and positioning and marketing objectives
Simmo’s Ice Cream competitive advantage arises in that it is one of the leading ice cream sellers in Australia. It enjoys a sweet and a long history having been established a little bit longer hence it has won more of the consumer markets. The product already has gained adequate market perception and is, therefore, easy to evaluate on the customer satisfaction basing on previous reports on performances of the brand (Hollensen, 2015).
Customer Feedback is also highly valued and, therefore, gaining a competitive advantage. The differentiation of the product branding is mainly unique and of its own. The unique taste and flavors make it fit for all consumers due to varied consumer tastes and preferences. The affordability and use of locally produced raw materials make it more viable and very tasteful. Most customers would wish to purchase it for the purposes of trying this unique product.
Its planned marketing strategy mainly aims at digitalizing their operations. This is mainly through the use of social platforms for marketing and also employing a technical team to assist in new brand developments and flavors.
Marketing objectives
First, Simmo’s Ice Cream’s major objective is to outshine other competitors in the market for example Unilever of Britain. Also, it aims at increasing its market through facultative and intense advertisements. This will help in increasing the market penetration and obtaining more feedback from the customers.
Target market
The main target markets for Simmo’s Ice Cream products include but not limited to; tourists, both local and international, families who are out on holidays and also foreign markets not exploited. Low and medium class earners are the ideal target market given that the products are pocket-friendly. The young population is also the target market given that they would prefer to eat these ice creams as a hobby and during their time out. This target market can be easily reached through a chain of various selling points. Also, it ought to be distributed through key retailers.
When packaging and branding of the product, it is good for the manufacturer to use or have more appealing and consumer friendly packages that are affordable (West et al., 2015). Distinctive packaging helps eliminate doubts of similar packages by customers. Packaging using tetra packs also helps improve the shelf life of the Simmo’s Ice Cream products. Marketing mix is also a key aspect of product strategy. This marketing mix is achieved through differentiation in the product, distribution chain, the pricing and also promotion strategies.
Product design
Simmo’s Ice Cream should design the product in a way that reduces production cost. The product should, therefore, economical. The design should be more appealing given that the customers mainly look at the prices, their appearances and also in terms of prestige depending on their class. The technical team should ensure the right flavors are achieved.
Pricing strategy
Pricing based on time is a key strategy given that demand varies with time. For example, the price can be reduced during winter due to the low demand. Similarly, prices can be a little bit hiked on holidays given the demand. Also, prices can be based on the value and flavor of the product. Simmo’s Ice Cream can also apply their role of price leadership in the Australian market by setting up the prices that are to be adopted by other players in the market. Since they utilize price leadership strategy, the company should set prices that ensure there is a higher contribution margin so as to maximize profits and gather for all costs used in the production, distribution, marketing and branding of the product.
Simmo’s should also utilize decoy pricing strategy. That is Simmo’s can offer at least 3 products and give one product for free. This strategy can encourage clients to purchase more products so as to have a similar product as a discount. The company can also set prices of other products to be higher than the others as a strategy of promoting sales of the lower priced products that has adopted decoy pricing.
The company can also set lower prices when introducing new products. This strategy can be adopted so as to make a product familiar and encourage clients to purchase the product and build customer relationship. However, this strategy should be utilized only for a short period in the marketing cycle.
Place strategy
Simmo’s Ice Cream should locate their shops at strategic points that are easily accessible to customers. At the same time, the cost of the distribution channels should be economical. They can also choose to do marketing through the internet to enable an online placing of orders. Evaluation of competitors’ strategies is also a key factor. The management should also evaluate the ability of continuous supply of raw materials, and ensure that the product is adequately supplied within all markets in time. This trend helps reduce shortages in some markets. Also required is an effective invoicing system, supply management and control of stock.
Promotion strategy
Promotion is a critical path in the marketing strategy. Simmo’s Ice Cream should engage in intensive advertisement through it unique branding. Advertising is important as it makes products to be familiar in the market. On the same note, promotion promotes goodwill and build image as well as educate and inform the public about the available products in the market. Also, it should aim at persuading the customers into purchasing their products. This goal can also be achieved through giving out of offers and discounts. Successful advertising can be through the print media, social platforms, window display and use billboards and cartoons. Competitive selling is also a key principle here. Competitive selling plays a critical role when it comes to prospecting and quantifying the product depending on the set prices.
On the same note, Simmo’s should engage in extensive sales promotion. That is they should provide incentives to promote their products and obtain a competitive edge in the market. The company should organize seminars and workshops that can be used to sensitize the customers about Simmo’s products. The company should also exhibit their products in business exhibitions that are organized across the country. These exhibitions are important in showing the products strengths and encouraging customers to purchase the organization products.
Finally, when the organization has expanded, the company should use event sponsorship strategy to promote sales and build customer relationship. The company can consider sponsoring popular events such as football games, charity runs and other events that are dear to the people in the market. This strategy often helps to improve corporate image and encourage customer loyalty and thus organization sustainability in the long run.
Poster
Conclusion
On conclusion, an effective marketing strategy will help the company to expand reasonably. The future expansion plans greatly depend on the company’s ability to put in strategies that will help it achieve market leadership. The products of this company enjoy a large market in Australia and recently foreign markets.
The strategies put in place will help it achieve profitability at the same time giving back to the society through employment and purchasing materials locally (Baker, 2014). Through the application of the SWOT analysis, the company can put in place strategies to outgrow the increasingly changing business environment.
Bibliography
Hollensen, S. (2015). Marketing management: A relationship approach. Pearson Education.
West, D., Ford, J., & Ibrahim, E. (2015). Strategic marketing: creating competitive advantage. Oxford University Press.
Baker, M. J. (2014). Marketing strategy and management. Palgrave Macmillan.
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With the creation of Facebook and Twitter among other social blogging networks in the early part of the twenty-first century, exchange of communication became a lot easier and wider. People became able to share photos, make new friends from different continents, share text messages amongst each other and even advertise their products online for free. Lorna Jane is an Australian wear company that recently decided to venture into the growing yoga clothing market. This is not traditional for the enterprise. Therefore, the company would like to understand Facebook as a potential marketing platform for their new product line. Social media has grown over the last decade from a social interaction site to an important marketing place for products of varying types. The essence of writing this consumer insight report is to analyze the behaviors and traits of social media audience as potential buyers for the Lorna Jane wear company’s new line of yoga outfit. In this project, emphasis will be put on Facebook as the primary target social media market.
Evaluation of the findings
According to the research findings, all the individuals who were sampled in the study had Facebook accounts. This shows that Facebook had a larger following of members compared to the other social media sites such as Instagram which came second, Twitter and the rest. 77 percent of the research sample had logged into their Facebook accounts less than an hour before the research was conducted. This shows that Facebook users, which are a majority of the social media users log into their accounts within hourly intervals. Most of the Facebook users also log into their accounts on daily basis. This shows that the social media site is very attractive among the youths. 16.3 percent of the interviewed people checked their Facebook accounts at least ten times per day. 16.6 percent of the sample spent at least two hours per day on Facebook. The highest number of people in the sample population spent their time on the Facebook reading newsfeed. Liking and viewing of photos and Facebook were some of the mostly performed activities.
The information from the first survey can be used to formulate an appropriate marketing policy for the new line of yoga outfit for the Lorna Jane were a company. From the information collected from the survey, Facebook is the most popular social network. Some of the most popular activities on the social network involve viewing timelines and exchanging photos. These traits are important for marketing of a product that depends on an impression to consumers. The posting of any comment or picture about a product on Facebook would lead to exposure to many potential customers. The high frequency with which Facebook users log into their accounts on Facebook presents a higher probability of a product being marketed on Facebook of being spotted by consumers.
In the second survey, many individuals interviewed were either just certified, at 34%, not sure whether satisfied or dissatisfied at 20% or dissatisfied at 22.7%. These statistics indicates that there is a high potential for the investment into the yoga outfits business. The dissatisfied people, 22.7% of all the sampled population, are a number large enough to warrant investment into products concerned with body fitness. The 20% of the sampled population who are not sure are also a target market as social media may also be used to influence people into not being satisfied with their unfit bodies and, therefore, start yoga. On the matter of importance of the looks in yoga pants, most of the sampled population was of the views that it was slightly important, moderately important and fairly important. This shows that at least people care about how they look in yoga pants. Therefore, they would prefer to buy a fashionable yoga outfit. This would be significant in choosing how to market the Lorna Jane Yoga line. The results for those planning to buy yoga pants in the subsequent 12 months showed that 62% of the participants would buy the pants within the period. This shows that there is an extremely potential market for yoga pants. Most of the participants also did not own the Lorna Jane line of pants. This showed that there is a need for a stronger marketing strategy to ensure that there is growth in the number of consumers of Lorna Jane yoga pants. The comments put along with the photos on Facebook influenced the people’s view of the brand. For instance, the second comment about Melanie was a bit selfish and self-centred. Therefore, people did not like the brand as much as they liked the pants in the first photo.
Recommendations and justifications
Lorna Jane Wear Company should employ Facebook as a marketing tool through paid ads. The company should also pick a famous sports person as a face for the campaign.
Based on the fact that Facebook utilizes both the consumer culture theory and the experimental consumer theory, the company should employ a strategy that takes advantage of both models. As seen from the analysis of the research above, most of the people are on Facebook and marketing via Facebook would expose the product to more potential consumers (Alizadeh, 2015). The investment into yoga wear is a risk that the company is willing to take, and it would, therefore, be correct for the enterprise to exploit any possible niche for their brand. Facebook is one of these niches (Shank & Lyberger, M.2014).
The choosing of an athlete as a face of the new Lorna Jane Yoga clothing line is based on the application of the two theories of consumption that Facebook exploits. The athlete must have a desirable athletic body as looks of people in yoga pants matter according to the research. The face of the campaign will be seen in ads of the new line around the internet and Facebook. This sports personality should be of attractive physic and popular among the youths (Kotler & Armstrong, 2010). This is because the youths are the principal target of Facebook marketing. The face of the campaign will wear the clothing line during her yoga exercises and share nice photos of herself via her official Facebook fan page and the official Lorna Jane fun page. Facebook users will then be exposed to the photos of the athlete experiencing the use of the yoga outfit in different stages of consumption.
Kotler, P., & Armstrong, G. (2010). Principles of marketing. Pearson Education.
Mangold, W. G., & Faulds, D. J. (2009). Social media: The new hybrid element of the promotion mix. Business horizons, 52(4), 357-365.
Shank, M. D., & Lyberger, M. R. (2014). Sports marketing: A strategic perspective. Routledge.
Vij, S., & Sharma, J. (2013, January). An Empirical Study on Social Media Behaviour of Consumers and Social Media Marketing Practices of Marketers. In 5th IIMA Conference on Marketing in Emerging Economies.
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You have to write about 2 business models and 2 marketing strategies that its provided on the file. just need a short introduction and 1000 words per 1 model/strategy. Total around 4000 words.
SAMPLE ANSWER
Introduction
Marketing strategy is a plan aiming at a goal of increasing sales and having a comparative advantage over the competitors. On the other hand, a business model is an actual representation of an organization of all interrelated architectural and financial designed by a business institution for both present and future guiding to reach a specific goal. Business models and marketing strategies nowadays are becoming more and more important in any business field. They are serving, as a core management discipline in the present world business is it in a financial or accounting organization. The thesis of this essay is to find out what are the characteristics of a good business model. It entails finding its importance in the field of business, the challenges that are faced when coming up with a business model. In addition, the discussion will discuss the diversified different types of marketing strategies. The importance of marketing strategies and what difference they bring in an organization will also be given.
Discussion
Business Models
SWOT Analysis
SWOT analysis has been defined by Yean Ying, Min & To Phuong (2009, p. 1105) as a strategy tool that is aimed at determining a company’s competitive advantaged. Ding-Hong, Tie-Dan & Chang-Yuan (2014, p. 68) argue that SWOT analysis is a tool that is aimed at analyzing a company’s strengths and opportunities against the threats and weaknesses. This tool is important as it can help practitioners determine the best ways possible to assist their organization to become competitive in the market. The motive behind this toll is to analyze a company’s prospects with paying attention to the bigger picture in mind (Everett 2014, p.58). For this tool to be certain effective information need to be acquired. This information ranges from internal to external factors that affect the business either positively or negatively Milosevic (2010, p.78). The internal information assists the practitioners to spot the strengths and weaknesses the firm establishes in its operations. The external factors are critical to ensuring that a company analyzes its threats and opportunities in the external environment.
Strengths are essentially factors that give a firm a competitive edge. Weaknesses, on the other hand, are factors or elements that are harmful if certain competitors to use them against the respective firm (Ying, Min & To Phuong 2009, p.1110). Opportunities are those favorable situations that can bring competitive advantages. Lastly, threats are unfavorable circumstances that tend to diminish the competitive advantage of a firm. The use of SWOT analysis best sits when assessing the services provided by a project. In addition, the tool is indispensable to determine the relationship between project stakeholders. In emphasis, the toll is indispensable in digging dip a problem in a company. The tool is applicable in intense situations that require the immediate solution to emerging issues. The emerging issues can include a drastic fall in profit (Ying, Min & To Phuong (2009, p. 1109). The tool can also be used to determine where change is possible. The effectiveness of the tool can be measured easily. The tool is effective if it clearly sports the strengths, weaknesses, opportunities, threats of a company. Furthermore, the performance of the tool is measured by the extent at which the recommendations given by the tool assist the organization to become competitive advantage (Ying, Min & To Phuong 2009, p.1106). In simper terms, the performance of the tool is determined by the extent at which the opportunities are exploited together will the strengths to outweigh the repercussions of threats and weaknesses.
The SWOT analysis is characterized with strengths and limitations. One of the strengths is that the tool is simple to perform. In addition, the tool has practicability (Everett 2014, p.79). A practitioner will find that collecting external and internal factors as well as comparing them to determine a firm’s competitive advantage is very simple. The other strength of the tool is that it is simple to understand. Notably, it gives all the four dimension of a firm using understandable format. Every factor is described individually (Ying, Min & To Phuong 2009, p.1115). It is being observed that the SWOT analysis tool is indispensable when identifying future goals. The tool assists practitioners to predict where the company will be in the future when it excels in manipulating its strengths and opportunities to fight its weaknesses and threats. Another observance pertinence of the tool is that it provides opportunities for further analysis. The tool allows the use of other models such as Blue Ocean Strategy and PEST analysis.
However, the SWOT analysis is short to limitations. Many critics argue that the toll is never serious. Its simplicity makes it a low-grade evaluation tool. One of its drawbacks is that it is cumbersome to read through. This is since it has excessive lists of strengths, threats, weaknesses, and opportunities. In addition, the tool is argued to have no prioritization of factors. In this regard, the tool is said to give each factor an equal measure. This is not true as Everett (2014, p.58) argue because some factors have more pressure on the firm than others. Another drawback of the tool is that it broadly describes its factors. This creates confusion in some cases. Ying, Min & To Phuong (2009, p.1105) argue that mush of what it is given by the tool are just opinions and not facts. Everett (2014, p.68) adds that a tool is a confusing tool since it lacks a recognizable method to distinguish between strengths, opportunities, threats, and weaknesses.
One instance in which SWOT analysis was used effectively was when Teys Australia was experiencing falling profits (Milosevic 2010, p.98). The top management carried a quick analysis to determine what was affecting the organization despite that the company is one of the biggest meat processing companies on the Australian land. The management got that its strengths include a strong brand, efficient production methods, and accessibility to global markets. The analysis also found that the firm had the weaknesses of vagaries of weather, animal disease outbreaks, fluctuating on major world currencies (Ying, Min & To Phuong 2009, p.1125). On top of that, the company found out that it had the opportunities to enjoy a larger market share in Japan and Indonesia. However, it observed that the threats ranged from the growth of the poultry industry, disease outbreaks, and climatic conditions. Therefore, it came to find that outbreak of diseases and climatic conditions were the major cause if decreasing profits. Thus is devised to use the government and its resources to do research to find cures for major cattle-related diseases (Milosevic 2010, p.145). Currently, the company is one of the major exporters of beef to Japan, Taiwan, and Indonesia. In conclusion, the SWOT analysis has fund four pillars of seizing and maintaining competitive advantage (Everett 2014, p.78).
Build on strengths
Minimization of weaknesses
Seizure of the opportunities
Counteract threats
PESTEL Analysis
The PESTEL model is the different version of the SWOT analysis. This is because it entirely deals with external forces. The PEST analyzes the political, economic, technological, and social factors in the external environment of a firm (Kader, Noor, Wilson & Mohammad 2014, p.67). These external factors are known to affect the activities and performance of a firm. The model engages in collecting and portraying information that deals with external factors which affect or might have affected the firm. The importance of this model is that it needs a firm to create both opportunities and threats for an organization. The practitioners need to know the instances when to use the tool (Gregorić 2014, p.562). These situations are best favorable when finding the current external factors that influence the organization.
The analysis is also applicable to identify external factors that may alter in the future. The other instance when the model is applicable is when the company wants to manipulate changes (opportunities) to shield against them (threats) better than competitors would do (Kader, Noor, Wilson & Mohammad 2014, p.68). The idea behind the analysis is that if a project is better placed than that of competitors, the company will be able to respond to changes more effectively. The political aspects can include both internal and external factors. The internal factors deals refer to those political aspects that are within the firm such as personal interest in the implementation of the projects. The eternal political factors include those factors that a firm cannot control such as governmental regulations. The economic factors include the macro and micro-economic events that relate to the function of an organization. The internal microenvironment engages in verifying the viability of an activity in the organization developments (Zalengera, Blanchard, Eames, Juma, Chitawo & Gondwe 2014, p.316). The macro-economic include the unavoidable government taxes, inflation, and unemployment. The sociological factor includes taking into consideration all events that affect the market and community socially. Technological factors involve taking into considerations all issues that affect the technology of the firm.
The performance of the PEST analysis can be evaluated by observing the extent at which a firm responds to the external factors (Kader, Noor, Wilson & Mohammad 2014, p.70). For instance, it assists a firm to product development. Carrying out a proper appraisal of the external factors, a firm can balance the outcome of each to see if it will unleash the product to the market. The other dimension in measuring the performance of the PEST analysis is by looking how an organizational change has been experienced developments (Zalengera, Blanchard, Eames, Juma, Chitawo & Gondwe 2014, p.326). For instance, when a firm wants to change one function of the department, the tool can be very helpful in identifying the hidden aspects that SWOT analysis, for instance, cannot find.
However, there are certain limitations and advantages associated with the PEST analysis. One of the advantages is that the tool is important it encourages the development of strategic thinking (Kader, Noor, Wilson & Mohammad 2014, p.72). It enables the concerned parties to think strategically on how to deal with a project. The other advantage is that it may raise awareness of the potential threats to a project. It also assists an organization to identify opportunities. Not only does the tool enable the form to identify opportunities, but it also assists the organization to exploit the opportunities (Zalengera, Blanchard, Eames, Juma, Chitawo & Gondwe 2014, p.346). In emphasis, it assists an organization to anticipate future difficulties to take actions on how to avoid or minimize them. Notably, one of the disadvantages is that the tool is entirely external. It only deals with external factors. It ignores the place of internal factors such as the place of the employee in the production line. The other limitation of the model is that it requires constant updating for it to remain relevant. The other observable feature of the model is that is based on assumptions. Much of what it says cannot be verified. Most of the recommendations given by the tool are rigid. It, therefore, becomes a problem for the projects of a firm to anticipate developments (Zalengera, Blanchard, Eames, Juma, Chitawo & Gondwe 2014, p.336). This is as far as the business environment is ever changing. The last noted disadvantage of the tool is that it allows its users to over-simplify the information that is used. Therefore, it creates the possibility of missing the most important data.
The use of the PEST analytical tool assisted a firm to a scenario. The tool was used by Wal-Mart Australia to identify its potential threats for the external environments (Kader, Noor, Wilson & Mohammad 2014, p.72). The supermarket observed that political factors such as heavy taxation and currency fluctuations. The supermarket also found that economic facts such as high inflation rate and higher consumer debt in Australia made to unable to diversify its operations (Zalengera, Blanchard, Eames, Juma, Chitawo & Gondwe 2014, p.366). In addition, the company realized that social factors such as an emphasis on safety by the Australians made it unable to unleash new products due to fear of rejection. The technological factor that Wal-Mart assessed was that ecological factors such as sustainability made to lose its role on sustainability. With that information in mind, Wal-Mart was able to differentiate the existing products (rebranding) to attract customer attraction (social factor) to make sales to counter heavy government taxes (political) (Shilei & Yong 2009, p.2097). In addition, by product differentiation, Wal-Mart was able to increase sales to diversify its operations (technological) to remain competitive in the market (economic).
Marketing strategy
Blue Ocean Strategy
Definition
This concept works based on developing uncontested market space rather than competing with substitute opponents selling similar goods or services in the market (Chan &Mauborgne 2011, p. 105). In other words in Blue Ocean marketing strategy, demand is created rather than competing over the limited demand, which makes competition eventually unnecessary. This explains the reason for the revival of circus industry despite the long-term decline of the industry, which now is doing incredibly well profit wise (Mohamed 2009, p.28). The concept is distinct to another model because it does not encourage direct competition with rival firms. Relatively, the model advice on the importance of using skill to create a strong image/brand. Čirjevskis, Homenko & Lačinova (2010, p.162) argues that the modern companies are not able to leverage their activities such that they want to achieve competitive advantage by using price strategies to outdo each other. The author attested that the most significant weapon to win in the market is the one that is focused on attracting as many customers as possible. Therefore, there is a need to come up with an innovative strategy to deal with the competition in the market.
Aims and Objectives of Behind Concept of Blue Ocean Strategy
The main objective of this concept is to enhance national development in nations worldwide by transforming local public sectors, states, low costs that cut across ministries, agencies, NGOs, and municipalities at large (Mohamed 2009, p.29). The model is important to ensure that most of the projects formulated by organization go through the implementation stage. The model assumes that a firm can best utilize the available resources to make it competitive in the market (Chan &Mauborgne 2011, p.107). The intention here is not to engage in cutthroat competition with rival firms, but to create a strong brand that other competitors can hardly challenge.
Requirements Favoring the Concept Usage
To discover the ‘Blue Ocean’ primarily the entrepreneurs should discover the five action frameworks to break the trade-off and eventually come up with a new curve. There are certain framework key questions that favor this concept usage (Mohamed 2009, p.38). One of the questions is related to elimination. Elimination, in this case, implies that the company identifies the factors that have existed in the organization that lowers its competitive advantage. In addition, the company needs to remove such factors. The other question relates to creation (Chan & Mauborgne 2011, p.115). In this particular occasion, the company identifies which products that can capture the market share in the market. The third question is associated to reduction strategies. Reduction entails that a company identifies what it should reduce below its level standard.
Measurement of ‘Blue Ocean’ Strategy performance
This strategy uses various approaches to measuring performances (Mohamed 2009, p.48). These approaches include developing a strategic canvas approach. It also gives a map of key performance indicators (KPI’s) which involves comparing one’s company with that of the competitors (Dr.Hilarly,2010), The straight forward approach. Blue ocean development analysis here uses (ERCC) grid meaning elimination, reduction, and rise (Chan & Mauborgne 2011, p.121). The above measures are important to ensure that a firm gauges the extent it has excelled in making its brand strong.
Strength of Blue Ocean strategy
A blue ocean strategy is a crucial tool used in diagnosing whether one’s business has developed a comparative advantage proposition and supporting business models. It has made most businesses grow at a high rate since they can be able to diverse their energy from irrelevant competitions. In addition, the strategy is simpler to use (Čirjevskis, Homenko & Lačinova 2010, p.172). The model gives some of the mechanisms that can be adopted by firms to make them competitive in the market. These include product differentiation and increased advertisements.
Limitations of blue ocean strategy
One of the limitations is that the model is unfeasible. The model is viewed as unfeasible since it is claimed no group was used since it is not stated how many companies failed as a result of using this strategy (Čirjevskis, Homenko & Lačinova 2010, p.171). It is argued that rather than Blue Ocean becomes a theory; it attempt to backup the already existing frameworks. This statement implies that Blue Ocean draws assist form other models such SWOT analysis and PESTEL analysis. The model has no any established methods of testing its recommendations. Another limitation of the model is that it is easily manipulated since each factor seems to contradict each other (Chan &Mauborgne 2011, p.127). The final limitation of the model is that is assuming that marketing success will come as just a matter of course. This is not true on the market situation. Gaining market share is a strenuous activity that takes a considerable time to perfect it.
Applications of Blue Ocean Strategy
China mobility is one of the instances the Blue Ocean strategy was implemented perfectly. China CEO Wang Jianzhou said that China market has been adapting the ocean market strategy, and that is why they have no worries of their rivals whatsoever, Starwood. In an interview Robin Pratt vice president, ‘six sigma’ said how they are taking systematically in applying the concept, TATA Motors (Čirjevskis, Homenko & Lačinova 2010, p.178). They have adopted the skills of differentiation and low cost as it is stated in Blue Ocean Strategy. Another instance where the application of the Blue Ocean strategy was effectively used was experienced by Casella Wines in Australia. The company decided to make new wines drinking rules (Chan &Mauborgne 2011, p.131). The final product that was unleashed was Yellow Tai. The brand became highly recognizable on the Australian land. However, the price remained the same even with the unleashing of the Yellow Wine.
Michael Porters Competitive Positioning Strategies
Definition of concept
The three porter’s generic strategies target as he had written in 1980 comprised of; cost leadership, differentiation, and focus. The basis of this concept is to describe how an organization or a company does to have a competitive advantage in the market (Grigore 2014, p.32). According to this strategy, a company has a choice of choosing one of the three or gain the risk of wasting its economic resources. Porter’s strategy was designed to combine and interact cost minimization strategy, market focus strategy and finally product differentiation strategy. According to Porter’s strategy, a company is comprised of major segments and there exists two major types of competitive advantage. One of the segments is oriented towards the minimization of costs (Lombana 2011, p.33). The other segment is designated to affect product differentiation. One requirement for a company to gain a competitive advantage is that it has to make an effort of picking a scope ahead of its competitors at least five times.
Aims and Objectives of Michael Porters Competitive Positioning Strategies
The aim of the model is to find the competitive rivalry in the market. By identifying the degree of competitive rivalry in the market, a company drafts mechanism on how to counteract it. The degree of rivalry may be high, for instance, due to the presence of high exists costs. The model also aims at observing the threat of new entrants. The company must be aware of the newcomers in the market to come up recommendations on how to deal with them (Lombana 2011, p.36). The threat of new entrants may be high due to government-driven obstacles. The other function of the model is to identify the threats of substitutes. The threat of substitutes is brought by such factors as brand loyalty, switching costs, and trends. The fourth factor of the model is the determination of the bargaining power of suppliers. Suppliers have power in the market when they are small in numbers (Grigore 2014, p.34). The last factor addressed by the model is the bargaining power of consumers. Consumers have power when the there are close substitutes, or there are different companies in the market that offer the same products.
Requirements and Conditions that Favor Competitive Strategy
This particular strategy works efficiently when the cost of production is quite costly. The model is mainly used when it comes in minimizing the cost. The model is also pertinent in a situation where the particular product is well developed, and no similar products can rival it due to its uniqueness (Grundy 2009, p.213). When a company focuses entirely on a particular segment that is demanded by customers, this leads to a quality product thus enhances loyalty to customers making it difficult to compete.
Approaches used in Measuring porters Competitive Strategy Performance
Cost Leadership Approach
This simply means that a company is enjoying more profit by producing at a lower cost and even if there is a price war, the company still gets profits while its rivals suffer losses. The company can have the privilege to enjoy this if there is accessibility to the capital required. When a company can obtain capital investment in both assets and raw material, this blocks other rivals since not many can afford such an investment. Furthermore, it ensures continuity in profit enjoyment, high level of expertise in the manufacturing process (Grundy 2009, p.223). This is meant to ensure that a company enjoys minimal cost because of the qualified and experienced workforce and efficient distribution channels. To attain a minimum cost possible, a company requires its means of transporting products.
Differentiation Approach
This approach mainly entails developing products that offer unique attribute and at the same time valued by consumers. Companies that enjoy this approach they have the following strengths; access to leading scientific research, high level of skills developed products and creative team (Grigore 2014, p.43). It also enjoys a strong sales team with the ability to communicate efficiently that markets products to the consumers.
Focus Approach
Here, a company concentrates on a particular narrow segment and tries to it’s best to perfect it so as to win the consumers loyalty thus able to beat their competitors of the similar product (Grundy 2009, p.225). By this, it considers itself to have performed.
Strengths of Michael Porters Competitive Positioning Strategies
With the help of this strategy, companies have been able to run their companies while producing at a minimum cost, which makes it not to collapse due to profits enjoyment. Companies have been able to lower price to powerful buyers (Grundy 2009, p.232). Companies can comfortably lower prices to defend substitutes without incurring any loss, customer loyalty. In addition, companies can discourage potential entrants in the market. The customers become more attached to differentiating attributes thus reducing threats on substitutes. Brand loyalty has been known to keep customers from potential rivals. A company can focus develops competencies (Grigore 2014, p.43). For instance, buyers have less power to negotiate because of fewer alternatives of similar goods, specialized products protect against substitutes. Finally, proper use of the tool can make rivals firms unable to meet differentiation-focused customer wants.
Limitations of Michael porters Competitive Positioning Strategies
Porters stated that use of more than one strategy would result in failure of the organization. Hence, there is no clear future direction trajectory. It is mentioned that differentiation strategy will be costly which clearly contradicts with that of cost minimization cost (Grundy 2009, p.236). Research writings of Davis state that companies were applying a hybrid strategy perform better than those adopting the generic strategy. Grundy (2009, p.237) challenged Porters by arguing that application of two strategies will result in more competitive. After eleven years, Porter revised his thinking and saw that hybrid strategy can exist (Grigore 2014, p.46). The two focal objectives of low-cost leadership and differentiation clash with each other leading to no direction. Porter had a primary belief in his concept about the invalidity of hybrid business strategy. He argued that the highly prone and turbulent market conditions would not allow the survival of concrete business strategies, since long-term establishment will depend on the ability and the quick responsiveness towards the market and environmental conditions.
Examples of How Concept have been appropriately used
Influencing and thinking in the United States of America and other countries towards health care deliveries (Grundy 2009, p.253). The strategy helps business managers and marketers to look at business powers between different types of departments and enhance the attractiveness and maximum profit.
Shilei, L. & Yong, W. (2009). Target-oriented obstacle analysis by PESTEL modeling of energy efficiency retrofit for existing residential buildings in China’s northern heating region Energy Policy. Vol. 37 Issue 6, p2098-2101
Global Economic Environment and Marketing
A. Project question
A major multinational corporation has appointed you as an economic advisor. You are requested to compile a report regarding the macroeconomic environment in two countries where the firm operates and explain how it might affect the company’s economic activity.
B. Project specifications
1. You may choose to focus your analysis on any existing multinational firm.
2. The two countries must be chosen from section C below as follows: one country from List 1 and one country from List 2.
3. Your report must include:
a. A brief description of the company.
b. A comparative analysis of all major macroeconomic indicators (see section D below, excluding 5 and 7) for the two countries and their overall impact on firm’s economic activity.
c. An analysis of the market structure in which your company operates for the two countries.
d. An analysis of the monetary and fiscal policy for the two countries andtheir impact on the firm’s economic activity.
e. An analysis of the foreign trade policy (international trade agreements)for the two countries and its impact on firm’s economic activity.
1
C. Country Lists
List 1 List 2
Australia Brazil
Austria China
Canada India
Italy Mexico
Sweden Russia
D. Macroeconomic indicators1 to be analysed (the last available 10 years):
1. GDP growth rate
2. GDP per capita at constant prices
3. Inflation rate
4. Unemployment rate
5. Interest rates (Monetary Policy Rate)2
6. General government balances (% of GDP)
7. Balance of Payments (% of GDP)
8. Exchange rates (national currency/USD OR National Currency/Euro)3
1 We recommend that you use the IMF database to collect your data for most of these macroeconomic indicators.
2 Data available from the relevant Central Banks websites
3 ibid
2
E. Project 1 Submission Guidelines
Length 2,500 words, +/- 10% (excluding tables, graphs, footnotes and references)
Presentation Arial 12 fonts, 1 ½ spacing, justified text
References A minimum of 20 references using Harvard Referencing
System (textbooks, official data and information sources)
F. Marking criteria and weights
CRITERIA WEIGHTS
Brief description of the company and analysis of the market structure in which the company operates for the two countries
20%
Data collection, comparative analysis of major macroeconomic indicators and impact on firm’s economic activity
25%
Analysis of the monetary, fiscal and foreign trade policy for the two countries and their impact on firm’s economic activity
40%
Report structure, presentation and references 15%
SAMPLE ANSWER
With the increasing globalization, it is important for a business organization to understand all the macroeconomic factors that may affect their business operations in different nations. Understanding the macroeconomic environment of the nation in which a business operates is important for the organization to develop marketing and business strategies that will work successfully. Marketing strategy should either be standardized or localized to suit the specific market in which a business operates. There are different factors that may affect how a business operates such as interest rates, inflation rates, GDP and the level of unemployment. This paper will provide a detailed analysis of the macroeconomic environment of Canada and India and how these factors might affect Wal-Mart economic activities in these two nations.
Wal-Mart Company Overview
Wal-Mart Company is an American Multinational retail store founded in the year 1962 by Sam Walton. The company runs a chain of warehouse stores and discount department stores in different countries. The company headquarters is in Bentonville, United States. Walmart was incorporated in the year 1969 and began selling its shares to the public in 1972. The company operates in three trade sections Wal-Mart US, Sam’s Club, and Wal-Mart Superstores. The company has over 11,000 outlets in 28 different nations.
The Fortune Global 500 rated Wal-Mart stores to be the world largest company in terms of revenue and similarly it is rated the biggest private employer in the globe having about 2.2 million workers. Wal-Mart marketing strategy is selling quality products at low prices to improve the lives of their clients and both the clients and the community to save money and live a better live.
Wal-Mart Stores Inc. supply diverse assortment of products, services and brands in the market. Some of the products the company offers include beverages, dry and wet grocery, food, clothes, electronic accessories, furniture, clothes among others. The corporation offers a great selection of high-quality merchandise, welcoming services under their “Everyday Low prices” strategy. The industry in which Wal-Mart Stores operate is the retailing industry. In the retailing industry, companies offer merchandise and products for sale at a fixed location such as a store, online, or by mail.
Comparative analysis of major macroeconomic indicators in Canada and India
Canada is positioned as the 11nth major in the globe in terms of Nominal GDP and the 14nth largest when it comes to Purchasing Power Parity economy in the globe. Canada is part of Group of Seven (G7) as well as the Organization for Economic Co-operation and Development (OECD) and is among the globe wealthiest countries (Nicoletta et al., 2010). The Canada is a developed economy chiefly controlled by the service, logging and oil industry. The company also tops in the seafood and fishing industry as well as entertainment and software industry.
On the other hand, India is positioned as the seventh in when using Nominal GDP and 14nth in relation to Purchasing Power Parity (PPP) (Ahluwalia, 2012). India is among the newly industrialized countries. It is a member of BRICS having an average growth rate of 7% for the last twenty years. India economy is rated among the fastest growing major economies in the world after China economy. India boasts of a young population, healthy savings and investment rates, low dependency ratio and high globalization rate. The primary source of revenue in India is the service sector. In fact, India is the major exporter of BPO services, software services, and other IT services followed by agricultural and industry sector.
GDP Growth Rate: This economic metric measure the rate at which the nation’s Gross Domestic Product over a period of one year. In Canada, the GDP annual Growth rate has increased by 1% in the second quarter of 2015 as compared to the previous year (IMF, 2015). Ranging from 1962 to 2015, the GDP annual growth rate in Canada averaged 3.24%. The GDP highest value was 8.80% attained in 1962 and a record of -3.98% in the year 1982. Statistics indicates that the wholesale trade dropped by 0.4% and the retail sector increased by 0.7%. This poses a mixed impact for Wal-Mart as it engages in both wholesale and retail trade. Therefore, Wal-Mart should concentrate more on the retail sector in Canada. The average GDP from 1998 to 2015 is 1.6% with an unsurpassed high of 5.30% in 2009 and a record low of -1.70% in at the beginning of 2009.
In India, the GDP annual growth rate has also increased but at a rate of 2.06 in the second quarter of 2015 as compared to the previous year. The retail industry has been enjoying a high growth rate in India paltry because of the high population consisting of young people and working population (Mohan & Chitradevi, 2014). Therefore, India is a favorable market for Wal-Mart as most of its operations are in the retail sector of the economy.
GDP per capita at constant prices: This metric refers to the measure of the total output of a nation computed by dividing the Gross Domestic Product (GDP) with the sum of all the people in the country. This metric is paramount for indicating the relative performance of different countries. It is imperative to note that an increase in per capita GDP indicates positive economic growth.
According to International Monetary Fund, the value of GDP per capita at constant prices was 38184.62 Canadian Dollar in the year 2009(IMF, 2015). Canada GDP per capita income has been on the rise since 2009. Projections indicate that the GDP per capita income is expected to be 41765.85 by the end of 2015 which is an improvement by about 6,000 Canadian Dollar. This positive outlook indicates an increase in economic growth in real terms and, therefore, may present more opportunities for Wal-Mart because the people purchasing power has increased.
On the other hand, International Monetary Fund reported the GDP per capita at constant prices in India to be at 31464.97 Indian Rupee in the year 2009. International Monetary Fund project that this value will increase to 46723.21 by the end of 2015. This indicates that Indian economy is growing at a faster rate as compared to Canada. Therefore, Wal-Mart should concentrate on increasing its operation activities in India as compared to Canada.
Inflation Rate: inflation refers to the continued and persistent increase in the common level of prices of commodities and services in an economy. Inflation is felt greatly in the retail industry because an increase in inflation results in the decrease in purchasing power of the currency circulating in the economy. The inflation rate in Canada has been increasing gradually over the years. The consumer prices in Canada increase by 1.3% in the year that ended in August 2015. The inflation rate in Canada values at 3.19% in the period between 1915 and 2015. The highest inflation rate ever felt in 1920 which hit an unsurpassedhigh of 21.60% in 1920 and a record low of -17.80% in the year 1921 (Beers & Nadeau, 2014). This macroeconomic metric indicates that the cost of goods in Canada has been increasing over the years, and thus it is not favorable for Wal-Mart Supermarket. This trend is because of an increase in inflation rate results in the decrease in purchasing power of consumers.
The inflation rate increased by 3.66 percent year-on-year as at August 2015, a slight decrease from 3.69% increase in July this concurred with the market expectations. In fact, the inflation rate hit a record low this year in August; the current inflation rate is below the set target of the central bank that is 6%. This is a good indicator of a thriving economy and good news for the retail sector because decreasing inflation rate results in an increase in the purchasing power of the consumers.
From the above comparison, it is evident that India is favorable as compared to Canada in terms of the inflation rate. The inflation rate in Canada is on the rise while the inflation rate in India has been dropping significantly. Therefore, Wal-Mart should expand its operation in India to take advantage of the decreasing inflation rate and increasing the purchasing power of consumers living in India.
Unemployment rate: Unemployment rate also has an impact on the economy performance especially on the retail sector. Unemployment rate determines the consumption level in a country and marketers should understand the trends in their market before making an investment decision. The rate of unemployment in Canada increased from 6.80% to 7% between August and July 2015. The unemployment rate had an average of 7.73% over the last ten years with an unsurpassed value of 13.10% in December 1982 and a record low value of 2.90% in June 1966. This indicates that the changes in the level of unemployment is fairly balanced and does not fluctuate.
Consequently, the rate of unemployment in India has been declining over the last five years. The unemployment rate in India declined from 5.20% in 2012 to 4.90% in 2013 (Mohan & Chitradevi, 2014). The unemployment rate in India averaged 7.32 percent in the last 30 years with an unsurpassed value of 9.40% in 2009 and a record low of 4.90% in the year 2013. This trend indicates that the Indian economy can create employment opportunities annually to absorb the vibrant new workforce to the economy. Therefore, the purchasing power of individuals in India is high. As such, Wal-Mart should utilize these investment opportunities and invest in the Indian market as compared to the Canadian market.
Interest Rates: Interest rates refer to the cost of using an asset. That is the sum charged by a lender to a borrower for the exploitation of an asset. An interest rate is often expressed as a percentage of the principal value (Mohan & Chitradevi, 2014). Interest rates have different effects that ultimately reflect in consumption and investment in an economy. High-interest rates increase the cost of borrowing and thus may limit the expansion of Wal-Mart through the use of credit facilities. On the same note, the interest rate has an impact on consumption, an increase in interest rates result in a fall in consumption. Therefore, it may affect the volume sold by Wal-Mart in the Respective economies.
In Canada, the general interest rate is at 0.5% as at September 2015. This value is lower than the average interest rate of Canada which is 5.98%. This indicates that the cost of borrowing is low, and Wal-Mart can utilize the resource to expand their operations in the Canadian market. The consumption level is also high, and this may result in increasing demand for Wal-Mart goods and services in Canada.
On the other hand, the interest rate in India has been decreasing over the years the current interest rate is 6.75% as at September 2015.This value is slightly higher than the value of the average interest rate that is 6.71 in the period between 200 and 2009. The slight increase may be felt in the decrease in consumption level as the cost of borrowing has slightly increased and may result in fall in the general consumption in the Indian economy.
In terms of the General Government Structural Balance, the potential GDP in Canada was reported to be -2.04% of the potential GDP in the year 2009 (Beers & Nadeau, 2014). The International Monetary Fund projects that the General Government Structural Balance of the potential GDP to be 0.05%. The value of the general government structural balance comprises of asset prices movements, temporary financial sector, and expenditure items. The metric evaluates the government cyclically adjusted balance from nonstructural elements beyond the economic scope. On the other hand, the Indian government experienced a budget deficit of 4.50% of the GDP indicating that the government has to allocate more money for financing government activities in the country (Mohan & Chitradevi, 2014).
The Balance of Payments: refers to a financial metric that is sued to summarize a nation’s transaction with other nations. The balance of payment looks into the transactions between a nation’s residents and non-residents in terms of transfer of goods, services, income and financial claims. In Canada, the have a current account of -17398 CAD Million in the second quarter of 2015. This indicates that Canada is experiencing a current account deficit. However, the average value of the current account was valued at -1808.71 indicating that the nation current account has been improving. Canada international policies encourage foreign trade and foreign direct investment of multinationals in their region. These policies may prove beneficial, and Wal-Mart should seize the opportunity to invest in Canada.
Exchange rates also have effects on firms that export goods and import raw materials. A devaluation of currency is beneficial to multinational firms as it will reduce the exporting rates while an appreciation in exchange rates increases the cost of export. The Canadian Dollar has been trading at 1.30654 against the US Dollar. This indicates a moderate gain against the euro as the industrial production gained as a result of QE program. On the other hand, the Indian Rupee trades at 65.049 against the US Dollar indicating that the value of Canadian Dollar is higher compared to the Indian Rupee.
Recommendations and Conclusion
From the extensive research on the macroeconomic indicators in Canada and India, it is worth noting that investing in India is more profitable as compared to Canada. This notion is because India is categorized as one of the newly industrialized countries and one of the world’s fastest economies (Mohan & Chitradevi, 2014). Macroeconomic metrics indicates a moderate long-term economic growth prospective because of the Indian young population, low dependency ratio, decreasing interest rates and a positive GDP growth rate as compared to Canada.
The unemployment rate has been declining in India indicating an increase in Per Capita income. This trend is good as it will result in a rise in the general level of consumption as people purchasing power will increase. This is contrary to the Canadian unemployment rate that increasing over the years. The population is also low and thus the market share in the retail industry is lower as compared to India.
Therefore, Wal-Mart should focus on increasing its business operations to take advantage of the positive economic outlook for the Indian economy. The company has a potential of increasing its market share because of the high population in India. This population will provide market for the Wal-Mart goods and services and on the same note provide cheap labor and hence cut down cost of production.
Nicoletta Batini, Thomas Dowling, Grace Bin Li, Evridiki Tsounta (all WHD), & John Kiff (MCM). (2010, November 24). Selected Issues Paper; IMF Paper Issue. Retrieved from http://www.imf.org/external/pubs/ft/scr/2010/cr10378.pdf
Ahluwalia, I. J. (2012). India’s economic reforms and development: Essays for Manmohan Singh. Oxford University Press.
Burnett, K., & Newman, L. (2014). 2 Urban policy regimes and the political economy of street food in Canada and the United States. Street Food: Culture, Economy, Health and Governance, 46.
Beers, D., & Nadeau, J. S. (2014). Database of Sovereign Defaults, 2015 (Revised May 2015). Bank of Canada.
Mohan, C., & Chitradevi, N. (2014). IMPACT OF MACRO ECONOMIC FACTORS ON BANKING INDEX (CNX BANK) IN INDIA. International Journal of Trade & Global Business Perspectives, 3(1), 722.
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Write a paper regarding data-gathering and market research.
Assignment Description: You may choose quantitative, qualitative methods, or both. Feel free to pick a service or product that you feel could be marketable and profitable for your organization. In this paper you are to fully discuss the process for gathering your data, how to interpret the data that you have gathered, and how you will analyze and apply the data is appropriate to a proposed marketing plan.
SAMPLE ANSWER
Data Gathering and Market Research
In the past century, the debate of quality detergent products has been wagging on the lips of many individuals. The information entailed herein provides vivid background details of the research process conducted, and an interpretation of the information gathered. It also provides an analysis of the research data for the manufacture of highly sustainable and better quality detergents in the market.
For starters, the company has been searching for ways to make a market statement through the sale of washing detergent. This has been met by numerous obstacles ranging from a very competitive environment by similar pre-existing companies manufacturing the same product to the presence of counterfeit washing detergents. The company resolved to conduct a market research study to capitalize on the market demand and profit realization (Creswell, J. W., 2013). The research was conducted by ethical means and provides an in-depth look at the nature of the product and its influence on the ever-changing market.
In conducting the research, various research methodologies were put into an account in the collection of viable information. It was conducted in a metropolitan region and the nearby suburban areas with over two thousand participants to be credited. This location was an ideal area and provided the right type of information that would be very useful once the analysis process of the study was reached. Some of the methods used to collect the data included oral interviews from respondents, provision of questionnaires, surveys, newspaper articles and journals just to mention a few.
The research process was conducted in a two week period. This necessitated the use of numerous resources for the provision of efficient and reliable information that would be used by the company in its motive of realizing the customers’ needs and satisfaction.
During the research, individuals from the area of study were provided with questionnaires that they were required to fill both accurately and candidly. It should be noted that a one major highlight from the research study was that the subjects who participated did it voluntarily. The few who declined purported due to personal restraints that could not be overcome. The institutional review board approval was in fact obtained from the research agency in which the study was conducted to conform to the regulations of the research. The questionnaire contained information concerning the company’s product about other similar products from other companies.
This was used to gauge the product’s sustainability in the market as well as the level of demand among its users. The results were then collected and analyzed for credible results. Secondly, the other method used in collecting data was through individual interviews. This not only provided firsthand information but also offered an in-depth perspective of the buyer’s thoughts about the product (Wedel, M., & Kamakura, W. A., 2012). These interviews were conducted by ethical procedures and were carried out on over seven hundred participants. The views were either recorded through audio and video or by note taking. It should be clarified that the views received were neither biased nor mitigated for credibility purposes.
The other method used to conduct the research was through newspaper articles and journals. Some of the data collected from the articles dated over ten years ago. Information on the articles collected included details of the shortcomings of former pre-existing products or companies, the challenges faced by some of these companies and pricing details about these products. One major highlight on the information from the articles and journals was stiff competition from foreign detergents in comparison to the locally produced. This was evident from the many advertisements that were present in the local dailies.
Moreover, government records disclosed the high importation of foreign detergents that are flooding the market scene. It was discovered that close to thirty-six percent of the available detergents in local stalls and shops were imports of the product. Thus, locally manufactured detergents face stiff competition that necessitates the need for adequate advertising and
The company also conducted a survey on its products on the market. This was time-consuming since required a lot of information from the users’ perspective of the product. The outcome was of mixed reactions since many individuals had contrasting views upon the survey. The methodology for conducting the survey was through T.V advertisements, posters and their general views about the detergents
For data consistency and clarity purposes the company also had to implement observation as a means of collecting information about the detergent. The company resolved to use individuals within its ranks to have a reflection of the product’s demand in the market (Easterby-Smith, M., et al, 2012). This involved sending selected individuals to a variety of stalls and shops to oversee the level of purchase and the availability of the product among its esteemed customers. They also had the added role of talking to the customers on their knowledge of the product and their personal views about the changes that perhaps need to be effected on it.
This, of course, was met with some challenges that might have inhibited information that would have been very essential to the company’s chief goal. One of the obstacles encountered was the reluctance of some individuals to express their views due to personal constraints. Moreover, some the stalls that were part of the research were not welcoming claiming it was part of their security protocol to bar strangers from collecting data relating to their stock and pricing
The findings showed a relation between the demographics of the regions and the customer demands for the product (Bryman, A., & Bell, E. 2015). It was noted that close to 48 percent of the locals in the sub -urban areas were not fond of using washing detergents while doing their laundry. This means close to half of the population preferably used ordinary soap only or nothing at all.
Therefore, mass sensitization needs to be effected on the benefits of using washing detergents. The interviews carried out proved quite evidently that the product was familiar with the locals and received several accolades from all corners. Despite the fact it is new in the market, most of the respondents preferred it in contrast to the rival products.
In contrast, some of the respondents questioned the supply of the products since it was inaccessible in most of the local stalls. This was also met with the user’s preference of local pre-existent products that are firmly becoming a monopoly. The respondents showed an interest in older local detergents that have shown success over their period of existence. The survey conducted also showed that the locals have an interest and approval in new products that was quite commendable by all manner.
For the success of any product in the market, user needs have to be met by all standards. Therefore, the products need to be in reach of the customer for the company to realize the profits (Miles, M.B., et al. 2013). One approach in providing sufficient service to the customers is by satisfying the users’ needs. It involves the provision of sufficient information about the product in this case and giving an indication of why your product is of better quality.
With respect to the results from the data collected is an analysis of the research process. It provides a summary of the research findings and an in-depth look. First and foremost, for the company to establish a profitable approach in its quest for delivering its products, some structures need to be in place. One of them is proper advertising, as is in the case of suburban areas.
It was realized that close to 22% of the respondents had little or no knowledge of the detergent. This could be attributed to poor advertising methods since there were no posters or any form of advertising media available in this area. Therefore, this necessitates the creation of avenues for advertising the company’s products.
Despite the increasing number of imported detergents, locally produced detergents are very much popular and appreciated by the users. The survey conducted indicated about 57% of detergent users preferred using locally manufactured detergents in comparison to those imported. It was also discovered that many people opted for washing detergents rather than ordinary soap due to the added advantages such as the removal of stains and the scent effect after a thorough cleaning.
In summary, the research was conducted provided a significant amount of information. The information submitted by the study was acquired through ethical means and considerations were put into the research methodologies of the study. Once the information is obtained company will use the information to meet its prosperity goals.
References
Bryman, A., & Bell, E. (2015). Business research methods. Oxford university press.
Creswell, J. W. (2013). Research design: Qualitative, quantitative, and mixed methods approaches. Sage publications.
Easterby-Smith, M., Thorpe, R., & Jackson, P. R. (2012). Management research. Sage.
Miles, M. B., Huberman, A. M., & Saldaña, J. (2013). Qualitative data analysis: A methods sourcebook. SAGE Publications, Incorporated
Srinivasan, S., & Hanssens, D. M. (2009). Marketing and firm value: Metrics, methods, findings, and future directions. Journal of Marketing research, 46(3), 293-312.
You are to provide an overview of the concept of marketing from the early stages to current marketing initiatives, strategies, processes, and trends. You are to fully support the midterm paper with extensive research with both text material and peer-reviewed literature.
This is an academic assignment and authoritative/scholarly sources are required You are expected to discuss the concepts of marketing in a way that demonstrates graduate-level critical thinking skill, extensive analysis, and evaluation of current research.
The paper is to be written in accordance with APA writing standards, which includes a cover page, an introduction, the body of discussion, a conclusion, and a reference section.
The key terms to use in the paper are as follow:
Branding
Brand equity
Brand strategies
Brand management
Types of branding
Value of branding
Effective strategies
Various brands
SAMPLE ANSWER
Each and every business organization develops marketing strategies with the aim of winning more and more clients and gains a competitive edge over other producers in the market. Consumers are spoilt for choices as there are different alternatives available for them in the market. Therefore, organizations must focus on developing winning marketing strategies that can actively promote their products and increase their market share. Marketing also helps in building customer loyalty by constantly reminding consumers about the availability of a product on the market.
In a nutshell, marketing refers to communication aimed at informing consumers about the value of a product, service or a brand with the goal of promoting the product in the market (Armstrong et al., 2013). On the other hand, branding refers to a company identity branding expresses the intrinsic value of an organization, product, or a service. It is the expression of values and attributes that give identity to an organization. Branding goes beyond marketing to the practice of creating a name, design or symbol that can be used to identify or differentiate a good from other available products in the market (Aaker & Biel, 2013).
However, this paper discusses the development of marketing and the marketing process. On the same note, the paper discusses branding and brand management are giving a couple of examples of some popular brands existing in the market.
An organization with a strong marketing strategy put in place can align the marketing activities with the organization objectives. This ensures that the enterprise can maximize the proceeds from their marketing efforts. A marketing process encompasses the development, planning, implementation, documentation and review of marketing systems and procedures (Boone & Kurtz, 2013). This is imperative to ensure that the marketing goals of delivering the right product and quantity in the right place at the time required and in a profitable manner. The marketing concept goes through a system of steps beginning with situation analysis, development of a marketing strategy, marketing mix decision and finally implementation and control.
The Marketing Process
Situation Analysis: It is imperative that a firm perform a in-depth research of the situation so as to discover any available opportunities to satisfy unfulfilled customer needs. On the same note, the firm must analyze its capabilities and the business environment in which the company operates. The organization must analyze both the external environment and internal environment. External environment refers to micro-environmental factors that have an effect on the firm operations.
Situation analysis should not only look at the present but also the past and the future aspects. The organization should analyze the different trends in the market so as to accurately forecast on the market situation (Czinkota & Ronkainen, 2012). A good situation analysis should be able to reveal challenges and opportunities existing in the market. Some of the frameworks used in carrying out situation analysis include the 5 C analysis, PEST analysis and SWOT analysis.
Marketing Strategy: After the identification of opportunities in the market, the firm should develop a strategic plan aimed at taking advantage of the available opportunity. The market research will provide insights about the market to give the business an opportunity to choose the market segment and optimal position itself in the market. The marketing strategy encompasses of market segmentation, target market identification, and value proposition.
Marketing Mix Decision: This involves the development of convenient constraints of the marketing mix. Marketing Mix encompass product development, pricing decisions, distribution contracts and the development of the promotional campaign.
Implementation and control: after developing a good marketing plan and launching the product, the organization should closely monitor the outcome of the marketing efforts and make necessary changes accordingly.
Brand Marketing and Brand Concept
Branding refers to the marketing activity that involves creating a name, design and symbol that clients can identify with when buying a product in the market (Balmer, 2012). Developing an effective brand strategy enables a firm to obtain a competitive edge over other competitors in the market. A good brand communicates a promise to the clients. The brand tells a consumer what to expect from the company products and services. Branding helps to differentiate firm products from those of its competitors. An organization brand is derived from the firm’s identity, what the firm intends to be and how consumers perceive the firm to be.
A brand strategy involves how, where, when, what and the citizens you plan communicating and conveying the firm’s brand messages. Marketing strategy such as an advertisement is part of a brand strategy. On the same note distribution channels is also the firm’s brand strategy. Branding is a wider concept that precedes any marketing effort and should cover all the creative and innovative elements that help to convey your identity to the market.
A consistent and strategic branding often result in a strong brand equity. Brand equity symbolizes the value added to the firm’s goods and services because of a recognizable name as compared to other identical unbranded products in the market (Keller et al., 2011). Business enterprises can craft their brand equity by developing products that are memorable, easy to recognize, reliable and possess superior quality as compared to its generic equivalent in the market. Having an extensive marketing campaign can also enable an organization to create brand equity (Chaston, 2014). A good example of an organization with strong brand equity is Coca-Cola. Consumers are disposed to compensate a higher price for a bottle of Coca-Cola as compared to other brands of soda in the market.
The value added because of brand equity arises from the perceived superiority or emotional connection to a brand. Coca-Cola products are often associated with happiness and customers will always transfer the emotional feeling of happiness by opening a bottle of a Coca-Cola product. Creating brand equity is a long process, and it requires consistency and persistence in the market. Brand equity is imperative when launching a new product in the market. A company having positive brand equity can increase the chances that clients are likely to purchase the firm’s new product by associating the new product with an existing and triumphant brand.
A good brand strategy is also created by creating a superior product, good positioning in the market, longevity, a comprehensive marketing and good advertising strategies (McDonald & Wilson, 2011). For the branding process to commence, it is essential that the company can create a perceived promise of quality to the consumer. Some of the essential components of a comprehensive branding strategy include:
Purpose: A successful brand should have a defining purpose because there are many competitors and consumers budget constraints are high. Therefore, firms should develop a purpose by creating a functional brand by coming up with concepts that focus on the appraisal of success based on the market expectation. Purpose can also be created based on the concept of intention of associating success with making profits and giving back to the society. A good brand should exhibit the willingness of achieving more than just proceeds.
Consistency: a good brand should communicate in a consistent manner and in a way that it enhances the organization’s brand. For a brand to stand out, it is paramount that the organization messaging is cohesive. This is because consistency creates brand recognition and customer loyalty. A good example of an organization that has achieved brand reputation is Coca-cola. The company can maintain consistency by making sure that each and every marketing element works harmoniously together to achieve organization sustainability.
Emotion: a powerful brand should be able to invoke emotions that consistently convince a customer from buying from one company as compared to another. This can be achieved by creating a community around the brand. Firms can give their clients an opportunity to feel like they constitute the part of the organization by consuming their products.
Flexibility: a good brand should be flexible and able to change constantly and adapt to the changes in the market so as to remain relevant. This objective can be achieved by engaging clients regularly in fresh and new ways.
Employee Involvement: a good brand should involve employees to engage clients and other stakeholders to achieve a greater good. It is imperative for employees of the firm to communicate well with customers and represent the brand in a memorable and innovative ways.
Competitive Awareness: Organization should embrace competition as an opportunity to improve the company strategy and create a greater value in the firm’s overall brand.
Brand Management
Brand management is part marketing that employs strategies to help enhance the perceived value of a merchandise line or a brand over time. It encompasses analysis and planning of how clients perceive the brand in the market and mounting a good relationship with the target market (Torres et al., 2012). Some of the tangible rudiments of a brand management are the product itself, price, look, and the packaging among others. The indefinable elements of brand management, on the other hand, include the experience clients had when utilizing the brand, and the customer loyalty to the brand. An effective brand management can help promote a product resulting in an increase in price and building of customer loyalty. This benefit is achieved because of positive brand association, good organization reputation and a strong market presence of the brand. It is imperative to possess a comprehensive understanding of the brand, target market, and the firm’s long-term objective so as to develop a winning strategic plan that can help maintain brand equity and gain brand value.
Therefore, when implementing marketing plans, it is imperative that the core brand values are emphasized, and it is aligned with the company objectives through internal or external branding. It is also equally imperative to understand how the organization compares with other competitors in the market. Some of the metrics that a brand manager can use to evaluate the effectiveness or campaigns include profitability, testimonies, and clients turnover.
Note that an effective brand management can result in an increase in demand for not only one good but also other goods and services associated with that specific brand. For instance, if a client loves pizza from McDonalds and trusts the brand, then he is likely to try some of the other products offered by the organization such as fried chicken.
Types of Branding
There exist various types of branding which collectively helps to achieve marketing goals, organization goals and finally organization sustainability. Some of the types of branding include corporate branding, personal branding, product branding, employer branding, and culture branding (Wheeler, 2012).
Corporate branding: Corporate branding is developed based on the foundation of promising to deliver quality products and service promptly to the clients. The purpose is to attract new clients and retain past customers through creation of brand loyalty.
Product branding: Product branding is reflected in the uniqueness of similar products produced by different firms in the market. A firm differentiates its product by branding through packaging, tastes, quality among others. An effective branding is what motivates a client to select one brand over the other.
Personal branding: personal branding is common among politicians, musicians, sportsmen and other celebrities. A politician, for instance, will focus on portraying himself as an honest and a performing person so that voters will want to put him in the office. A celebrity, on the other hand, has to be self-branded based on his/her personality, dress code, and voice. Organizations can use celebrity as a brand and marketing strategy for their products. For instance, Samsung Mobile uses Didier Drogba, a popular football player to promote their brand in the market. Chevrolet uses Manchester United to market its products across the world by associating the game with their products. Popular musicians have often been used to promote brands especially clothing and accessories such as tablets and mobile phones. Organizations also use different music from different artist as their theme song in advertising their products.
Employer branding: Employer branding center of attention is on making the organization employees to conceptualize the mission, vision, objectives, products and services of the company. The aim is to enlighten employees so that they can uphold the corporate brand when communicating with the organization’s client.
Culture and community branding: Community branding involves building organization reputation by engaging in activities that shows the collective good of the company to the community and employees. This can be achieved by developing programs aimed at helping people in the society through corporate social responsibility (Torress et al., 2012).
Some of the effective strategies for brand building and brand positioning is understanding the market. It is imperative for an organization to understand the market and customers needs before embarking on branding and developing a marketing strategy. After proper understanding of the market will enable a firm to define its brand based on customer requirement. Defining a brand is critical because in the end it will be what the organization truly stands for. An organization should look for the core strengths to capitalize on and weaknesses to improve on and create a better brand.
A company should also strategize by differentiating and positioning the brand in the market. This trend is imperative as it helps the company to win new clients and maintain a competitive edge over other producers in the market. A company should always focus on creating unique advantages in clients mind to create perceived value. After creating a unique value proposition, the firm should focus on developing an effective marketing and branding strategy to help gain market share by permitting consumers to appreciate the greater value of your products.
A firm should also focus on building and exposing the brand. Branding takes a lot of time to grow but has numerous benefits. Firms can use marketing strategies to expose a brand. This can be achieved by using promotional channels, online forums, blogs and social media.
Finally, it is essential that a firm constantly review its brand, marketing plans and other critical features that can help the organization to attain organization sustainability. A company should develop a brand cycle where new events, changes, and environmental conditions are evaluated to identify opportunities and challenges a brand face (Balmer, 2012). This is important as it can be used when enhancing brand product and re-establishing it to stay relevant in the constantly changing business environment.
A brand may be expressed through storytelling. Some of the most popular brands in the world include
Coca-Cola: Coca-cola is one of the oldest firms that have existed in the market for a long time. The company can stay relevant in the market through effective marketing and branding. The company uses color coding and the design of the actual bottle that soda is packaged because it is a source of competitive advantage. Most consumers like to be associated with the company slogan of creating happiness through the production of refreshing products. Coca cola competitors such as Pepsi may win consumers, but most people would like to buy Coke because they enjoy the experience of drinking Coca-cola products. The company has built brand loyalty through effective marketing to become one of the most valued products across the globe
Volvo can position itself as a company that produces safe vehicles to ride on the road. Nike, on the other hand, is able to build a brand reputation by producing quality sports products such as shoes. IBM is also another example of a company that has been able to produce quality computers that consumers will want to buy over other computer accessories in the market.
Starbucks coffee has been able to build its image and reputation over the last twenty years. The company has not only made an impact on the coffee industry but also on the society. The company focused on building its brand identity based on color and shape excluding the use of typography.
By and large, it is evident from the discussion that marketing is not just focused on advertisement and use of promotion to increase market share. It also involves crafting a memorable experience by building a reputable brand that consumers will want to associate with everyday (Kapferer, 2012). Successful branding often results in enormous benefits beginning from an increase in market share, the price of a product and customer loyalty. However, it is important that a company image can be tarnished easily when an organization participates in activities that can hurt customer or the community in general. In conclusion, firms should focus on developing marketing strategy and brand strategy that can help in increasing profitability. This can achieve through branding and branding strategies aimed at creating brand value and obtaining a competitive edge over the competitors and hence organization sustainability.
References
Aaker, D. A., & Biel, A. (2013). Brand equity & advertising: advertising’s role in building strong brands. Psychology Press.
Armstrong, G., Adam, S., Denize, S., & Kotler, P. (2014). Principles of marketing. Pearson Australia.
Balmer, J. M. (2012). Strategic corporate brand alignment: Perspectives from identity based views of corporate brands. European Journal of Marketing,46(7/8), 1064-1092.
Boone, L., & Kurtz, D. (2013). Contemporary marketing. Cengage Learning.
Czinkota, M., & Ronkainen, I. (2012). International marketing. Cengage Learning.
Chaston, I. (2014). Small business marketing. Palgrave Macmillan.
Kapferer, J. N. (2012). The new strategic brand management: Advanced insights and strategic thinking. Kogan page publishers.
Keller, K. L., Parameswaran, M. G., & Jacob, I. (2011). Strategic brand management: Building, measuring, and managing brand equity. Pearson Education India.
McDonald, M., & Wilson, H. (2011). Marketing plans: How to prepare them, how to use them. John Wiley & Sons.
Torres, A., Bijmolt, T. H., Tribó, J. A., & Verhoef, P. (2012). Generating global brand equity through corporate social responsibility to key stakeholders.International Journal of Research in Marketing, 29(1), 13-24.
Wheeler, A. (2012). Designing brand identity: an essential guide for the whole branding team. John Wiley & Sons.
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The primary purpose of this paper is to identify two print advertisements of a product of choice. In this case, I will use Coca-Cola Company that targets two different consumers in the market according to this study. The paper therefore, seeks to determine the positioning of the product in the market and the segmentation of the company’s products. Also included in the paper will be an analysis of the target market of the company’s advertisements and their effectiveness in communicating the message to its intended audiences.
Part A
The Positioning of the Products in the Advertisements
The Coca-Cola company has been in the soft drink industry for quite a period, with this achieved through an approach that seeks to keep the company’s position safely. The company has formally taken the privilege of drawing its strength globally since its products are known in the entire world through an efficient marketing strategy.[1] In accordance to the ads detailed in the appendix, it is evident that the company pays its attention to the cultural and social attributions in the society as a strategy of positioning its products.
The first add gives a depiction of an image that relates well with youths who would want their names registered on the Coke bottles for a proposal of marriage. The company has in the second image used a social interaction as a possibility of sharing its product, a factor that depicts the approach in using the social platform as an avenue to position its product globally and locally.
According to the two images, it is critical to note that the positioning is different. This is in consideration of the fact that experiences, and personal preferences of individuals may differ in accordance to their different localities.[2] Marketers therefore make the products positioning different to meet the individual needs of each customers and for the benefit of the company. This remains the key element that has kept its positioning in the market, a factor that has supportedthe company’s profitability and effectiveness. The Five Bases of Segmentations Utilized
Market segmentation according to sources is an approach used by marketers in dividing a market into groups or rather segments to suit the different needs of customers who exhibit similar purchasing behaviors. In our case, Coca-Cola in segmenting the market acknowledges its various buyers by developing a different marketing mix.[3] Through a mass marketing approach, the company uses a marketing approach that treats the market as a total whole by providing its Coke products for the buyers in the market. Through market segmentation, the company is in a position of targeting different groups of customers through an approach that adapts the product to suit the targeted segment. This example can, therefore, be depicted in the ads since they focus on;
Geographic Base;
In both the ads, it is evident that the setting of the region is urbanized, thus giving the illusion that the company has segmented its product to the urban population.
Demographic Base;
In this, the ads depict a certain age and genders.[4] The first ad gives the illusion of a young man proposing to a lady upon the putting of his name on the coke bottle. In the second ad, there are two intellectual men of young age sharing their possibilities through indulging in the company’s products.
The Target Market within the Advertisements
It is critical to determine that Coca-Cola primarily targets the whole market rather than particular sections of the population. However, this does not typically mean that the company has not a differentiation strategy to meet the needs of the whole market. In the ads, it is notable that the company has introduced a diet coke as a segment of its different products.[5] Through this, the consumers, young in nature are given the privilege of writing their names on the bottles, a factor that is enhancing the buying power of the young population. The diet coke according to the image is a product also designed for people who would not want to take too much sugars and calories, thus making it acceptable to different people in the targeted market.
On the second ad, the company has also developed an approach to working smart through giving an illusion of intellectual young men sharing a coke over a chat. This ad gives the impression that Coca-Cola Company seems popular within the young generation who would share possibilities through a drink.[6] Both the ads, therefore, provide the company’s target groups the privilege of choosing what they want, especially for the people who would not want to drink much sugar. This makes diet coke the option for such consumers.
The Effectiveness of Communication in the Ads
According to the two ads, it is critical to determine that the advertisers have effectively communicated the message to their target audiences. The ads have well-detailed information giving the consumers the necessary knowledge they need to know about the products. The diet coke ad enables different customers also to have their preferences acknowledged by the company, a factor that would promote the buying power of the targeted audience.[7] However, it is essential; to determine the fact that the advertisers did not include the products prices in the ads, a factor that may challenge their audience in determining the prices of the products.
Part B
Stimulus Generalization
It is critical to mention that some private labels and brands often mimic the trade dress of other leading market brands. This is how stimulus generalization occurs with the features linked to the leading manufacturers brands generalized as a private-label. An instance of this can be depicted in a positive relationship that involves a pleasurable feeling for certain products in the market that can be steered by another product that is identical to an original brand.[8] The main reason for copying of other brands is to increase a company’s sales through a parallel response given by customers who perceive the product has the same individuality similar to the original product. The primary objective of using this approach remains in the fact that it enhances the projection of one brand to others.
How the Concept of Stimulus Generalization Has Been Used
Otherwise known as copycat branding, the stimulus generalization enables manufacturers to get opportunities of developing product packages that are in a way similar to that of a leading brand in the market. Manufacturer’s for that used the visual cues such as size, shape, color and image of the main brand that attracts consumer’s attention within the marketplace.[9] It is, therefore, essential to note that the stimulus generalization approach has mainly been used in:
1. Family Branding;
I this, several products capitalize on the reputation of another manufacturing companies name. Companies such as Campbell, Heinz, Google, Virgin, and General Electric rely on various corporate brands to sell their products.[10]
2. Licensing;
This approach allows well-known brands in the market to rent names.[11] This approach has gained fame in the market today since many marketers link their products and services with the already established brands.
Product-Line Extension;
In this, related products are inclusively added to an already established brand. This can be depicted in Dole, which mainly deals in fruits and was in a position to incorporate refrigeration juices and juice bars while Sun-Maid included raising bread from raisins.[12]
Look-alike Packaging;
Through this approach, distinctive packaging designs are created in strong associations with particular brands. This method is primarily utilized by the makers of generic brands and who wish to communicate a quality image by inducing the similar packages of a leading brand.[13] The imitation of successful brands is an approach that is likely to occur in a crowded market environment.
According to this study, it is evident to note that the attitudes and behaviors that are mainly conditioned to a particular brand may be transferred to another product into a similar category and name as well as other products with the same name but of a different group. To demonstrate this in an example, Wal-Mart opened its functions as an organized retail store for multibrand.[14] As soon as the brand was registered in the consumer’s heads and recognized in the market, the company developed a private label for the parallel and the unparallel merchandises, a factor that saw a similar response from their consumers who purchased these products from the company’s stores.
The Advantages and Disadvantages of Copying From an Original Brand
In this study, the quality and performance of a brand in the market remains one of the essential factors in spurring the process of stimulus generalization. It is therefore, essential to determine that companies can either be advantaged or disadvantaged in the copying of their brands. This is ostensible from the fact that the quality of a brand determines the consumer’s interest in the brands.[15] In the event that the quality of a copied product is lower than that of the original brand, the consumers are likely to exhibit a positive feeling towards the original product, a factor that benefits the brand manufacturer.
However, in any case the quality of the two competitors turns out to be equal, consumers are likely to consider the pricing premium they pay for an original brand and choose to purchase the copied product. In this, it is, therefore, essential to note that the consumers association with a product can be influenced by their belief in a product.[16] A company’s reputation, therefore, plays a role in creating a strong impact on brand evaluations.
It is empirical to mention that the strategic benefits of stimulus generalization may outweigh the advantages within the confines of strategic marketing. In my view, the stimulus generalization is likely to present itself with the opportunities of an open economy[17] that is offered by different markets.
In as much as the market is not only limited to a single brand, the main disadvantage evident in this case is in the challenges that consumers face in making a choice. In the case that a customer is not pleased with a chosen version of products, they have the liberty to pick another product with a similar brand name.[18] Some companies will therefore never get out of business once they get hold of the marketing concept of establishing their ventures as brand names.
Similarities and Differences between the Two Products
The images attached in the appendix of this paper give two principal products; Nescafe and Sainsbury’s full roast. The table below depicts the similarities and differences between the two products with Nescafe being the original brand.
Similarities
Differences
1.Same Content between the two products
1. Dis-similar shape on container or packaging
2. Same color of container used in packaging
2. Dis-similar lead color used in covering the content of the package.
3. Same container size and shape
3. Different visual cue.
4. Same Label coloring
4. Different brand names.
Through the use of visual cues, shape, color, and size of an established brand, consumers are at times attracted to such private labels within a shopping environment, a factor that makes the private-label products generated by the original brand in the market.
WhetherCopying Bring Benefits or Harm to Consumers
Copying a brand can generally displace other brands in the market which as second or third in market share thus reducing the nature of innovative products, a factor that reduces the choices of consumers.[19] It is therefore, essential to note that some of these products may be harmful to consumers since they give the users no reassurance of consistent quality since the qualities of the products may vary.
The branded originals give the consumers an assurance that the quality of the manufactures products purchased is compatible. At times, consumers may be influenced by the prices of the copied products but the quality may be a challenge, thus causing more harm than gain. However, in some cases, copying can be beneficial to the consumers in the event that the product meets the exact demands of the consumer and is compatible with the original brand.[20] This may, however, be a challenge to the brand manufacturers since the copied brand may turn out to be a competitor. In this, the customers will, therefore, determine the price variances in purchasing these products.
Strategies to Counter Copying
Copying other brands has some negative implications to the marketers. In cases where copying is a free ride, the markets encounter challenges on reduced incentives that allows them to invest and compete on quality that impacts consumers.[21] Copying therefore damages the reputation of brand manufacturers and their abilities to earn fair returns on their innovative ventures. In order to counter the element of copying, it is essential that laws are established within a country to protect the rights of the brand manufactures.
Marketers can therefore register their trademarks including their logos as a strategy to the infringement of their brands. It is also essential for marketers of well-established brands to encourage their consumers to discriminate against the buying of cheap imitations since the products are note up to their expectations.[22] In this, some marketers have adopted a strategy called the masked branding that hides a product’s true origin, a factor that mitigates the chances of consumers from experiencing the same conditioned response.
Conclusion
The study has therefore established the market positioning and segmentation approaches used by Coca-Cola in the ads. Through this paper, I have also determined the prospects of stimulus generalization as employed in the market and how to regulate a manufacturer’s brand from infringements that come with copying.
References
Ali Sair, Shrafat. 2014. “Consumer Psyche and Positioning Strategies.” Pakistan Journal of Commerce & Social Sciences 8, no. 1: 58-73. Business Source Complete, EBSCOhost (accessed September 11, 2015).
Eisend, Martin. 2015. “Have We Progressed Marketing Knowledge? A Meta-Meta-Analysis of Effect Sizes in Marketing Research.” Journal of Marketing 79, no. 3: 23-40. Business Source Complete, EBSCOhost (accessed September 11, 2015).
Hakhshir, Ghassan. “Positioning Strategies Development.” Annals of the University Of Oradea, Economic Science Series 23, no. 1 (July 2014): 979-988. Business Source Complete, EBSCOhost (accessed September 11, 2015).
Hong-Youl, Ha. 2011. “Brand Equity Model and Marketing Stimuli.” Seoul Journal Of Business 17, no. 2: 32-60. Business Source Complete, EBSCOhost (accessed September 11, 2015).
Till, Brian D., and Randi Lynn Priluck. 2000. “Stimulus Generalization in Classical Conditioning: An Initial Investigation and Extension.” Psychology & Marketing 17, no. 1: 55-72. Business Source Complete, EBSCOhost (accessed September 11, 2015).
Appendix
PART A
PART B
[1] .Hakhshir, Ghassan. “Positioning Strategies Development.” Annals of the University Of Oradea, Economic Science Series 23, no. 1 (July 2014): 979-988.
[13] . Eisend, Martin. 2015. “Have We Progressed Marketing Knowledge? A Meta-Meta-Analysis of Effect Sizes in Marketing Research.” Journal of Marketing 79, no. 3: 23-40.
[20] . Till, Brian D., and Randi Lynn Priluck. 2000. “Stimulus Generalization in Classical Conditioning: An Initial Investigation and Extension.” Psychology & Marketing 17, no. 1: 55-72.
McDonald in The US Market Strategic Management Order Instructions: The assignment is aimed at enhancing your ability to integrate the material learned during this course and to apply the material to a contemporary business issue in the business context.
McDonald in The US Market Strategic Management
It is important that you clearly demonstrate your understanding of core concepts and analytical tools by explicitly explaining and applying course concepts and tools in your assignment report.
You work as an analyst/consultant for the Hong Kong branch of Infinity and Company, Inc. The company is an international management consultancy that specializes in helping companies to realize their strategic objectives.
You have been given the task of analyzing and evaluating the strategic management process of a new customer (you can use your own company or one that you are familiar with). The company is experiencing strategic “drift”. Strategic drift is the term used when strategies progressively fail to address the strategic position of the organisation – this is frequently followed by transformational change and demise.
Thus the company has not been performing well for the past four years. Unless they make some drastic changes to the way they operate, especially regarding strategic management, they are in danger of going out of business within the next two years.
You will need to analyse the company’s strategic management process, diagnose what they are doing wrong, and make appropriate recommendations that should bring them back to eventual profitability, focus, competitiveness and long-term survival.
You will need to write your assignment in the form of a preliminary report for your manager’s approval before it is presented to the customer. Your report must synthesize your observations, diagnose the problems and arrive at a final set of recommendations. In other words, you must identify the root causes, not the symptoms, of the company’s problems and make realistic recommendations for the company’s unique competitive situation.
Your report can include, as appropriate, a discussion of:
. Company background
. Company mission, vision and strategic objectives
. Industry analysis, including the key success factors
. Corporate governance, ethics and social responsibility issues
. External scanning
. Internal scanning and capability analysis
. Core or distinctive competencies
. Strategy formulation (corporate, business, functional levels)
. Strategic implementation
. Strategic monitoring and control
. Overall evaluation of the company
. Problem diagnosis and recommendations
. Other relevant information that you deem important
McDonald in The US Market Strategic Management Sample Answer
Macdonald in The US Market Strategic Management Process
Introduction
In the recent years, it has been recorded that McDonald in the U.S. (United States) market has experienced strategic drift. In 2012, to be specific, the industry experienced an economic decline of 15%. Notably, the company has been performing poorly lately. Crawford, Humprises & Geddy (2015, p.12) argues that there is needed radical changes at the enterprise to vindicate it from collapsing. The company has to remain strategically placed to enable it fight its rival firms. Its strategic management process has to be revived and amended to become effective. Bernhardt, Wilking, Gilbert-Diamond, Emond & Sargent (2015, p.13) give that effective strategic management process allows a firm amalgamate productive ways of operations. In return, effective running of operations guarantees accelerated sales and profits. Therefore, the following discussion indulges in discussing the strategic management process of MacDonald in the U.S. market, its problems, and the appropriate recommendations that need to be installed for the company to rise again.
Company Background
From 1954, Macdonald’s has been giving the U.S. people a reason to smile due to the quality food products it has been providing to them. McDonald has been able to survive through varied marketing strategies that have been introduced to assist the company to become one of the best-known fast-food brands. In 2008, the management of the company reviewed its trademark design and named it as Ronald MacDonald (Crawford, Humprises & Geddy 2015, p.14). Creativity has been a base for the company’s strategic management process. For instance, the company innovated Big-Mac attracts children because there are toys given after purchasing those products. In other areas, the company establishes its marketing strategies’ on the internet by constantly advertising and promoting their products. McDonald has been thinking of providing coffee in the move to attract British clients. The company has observed uniformity such that all restaurants open during breakfast hours to give a complete or restricted breakfast menu. On revenue perceptive, from 2003 to 2012, the company was making excellent profits. However, the trend has reversed by 2015, and the company is regretfully making losses (Bernhardt, Wilking, Gilbert-Diamond, Emond & Sargent 2015, p.14). The young and the children are most targeted customers by the enterprise. The company has been providing McKids items that comprise of casual wear, video, and toys. Demographic concerns have affected the company to release worldwide in the call to address the increasing levels of obesity among the Americans.
Vision, Mission, and Strategic Objectives
It is paramount to any organization to have missions, vision, and strategic objectives for it to have an effective strategic management process. The vision of McDonald in the U.S. market is to provide goods that are of high quality as well as giving customer products worth their money (Crawford, Humprises & Geddy 2015, p.17). The mission of the McDonald has been the energy behind accomplishment of its purpose. The purpose, in this case, is fulfilling the vision. Therefore, one of the missions of the MacDonald is to become the best boss to its workers. The other indispensable mission is to give operational superiority. Accomplishing targeted profits is another mission, which is reinforced by the mission of intensifying the brand name through multifaceted technology and systematic innovation (Dabija, Christian & Postelnicu 2015, p.206). On the other hand, its strategic objectives comprise of meeting the social and ethical responsibilities in the U.S. To accomplish its mission, the company targets to provide quality food to their clients. The third strategic objective of the company is to deliver quality food to customers in an enjoyable and friendly environment.
Industry’s analysis
McDonald has been surviving in the U.S. market besides heavy criticism against it. One of the success factors behind the excellence is that person-in-charge normally executes business-related strategies. This factor has enabled the company to amend those areas that are raised by customers (Dabija, Christian & Postelnicu 2015, p.209). The company has good marketing strategies that comprehensively satisfy both children and adults. One of the success factors that make the company establish a strong competitive advantage is that it possesses a strong brand name, character, and name. The brand equity of the enterprise is tremendous, as it is the number one fast food business operating many restaurants in the U.S. (Hock, Su, Chin, Hooi & Migin 2014, p.1074). Another distinguishable success factor that distinguishes the company from competitors such as Burger King and Wendy is the possession of distinguished training for its managers. Managers at this respective company receive a serious type of training through an installed training program referred by Bernhardt, Wilking, Gilbert-Diamond, Emond & Sargent (2015, p.17) as Hamburger University. Therefore, the company is able to meet its development projects with ease with the assistance of the trained personnel.
Corporate governance, social, and ethical responsibilities
To maintain its social responsibility, the company has been working with various charities and communities to sustain their reputation. For instance, the company has worked together with other NGOs (non-governmental organizations) in the U.S. to assist the aged people in the home for the elderly. The company has considered paying their employees reasonable remunerations so that they can appear as if they are helping back the society. Nevertheless, its ethical responsibility has been questioned against the amid fast-food protests workers such as in Japan attesting that employees are exploited economically. Important decisions made at MacDonald are made by owners (Talpau 2011, p. 54). However, its corporate governance has been criticized lately for statements that it lacks validity. This is apparent because of the current scenario where a McDonald’s suppliers repacked expired meet. This caused a drop in revenue by 7.3% in the U.S.
Internal scanning
SWOT analysis is used to conduct an internal analysis of McDonald in the U.S. One of the strengths is that the company has Plan to Win Initiative. This initiative encompasses place, people, products, price, and promotion (Xu 2014, p.1009). The initiative enables the company enhance restaurant familiarity to increase sales and profits. However, the company has weakness in actions correlated with environmental issues. The company typically uses HCFC-22, which is used to make polystyrene that depletes the ozone layer (Gerhardt, Hazen & Lewis 2014). Unhealthy food representation is another weakness affecting the industry such that its customers are correlating the company with the high number of obese people in U.S. The company has an opportunity to the appearance of freebies and discounts. The recent trend is that customers are developing the habit of liking freebies and discounts, even in circumstances when they do not require or use them after (Hock, Su, Chin, Hooi & Migin 2014, p.1076). The major threat that is making the company’s strategic management process fail is the public health disaster. The U.S. population still remembers how fast foods such as Supersized Meal and slim salad selection are causing heart attacks among its people.
IFAS analysis of the McDonald’s
Strength
1. Has Plan to Win Initiative
Threat
1. The public health disaster
Weaknesses
1. Environmental issues eg. Use of HCFC-22
2. Unhealthy food representation
Opportunity
1. The appearance of freebies and discounts
Table 1- the IFAS analysis of the McDonald’s
Internal factors
Weight
Rating
Weighted score
Comment
strength
Brand equity
0.9
5
4.5
Excellent
Consistency of food
0.7
4
2.8
Fair
Balance sheet position
0.4
2
0.8
Poor
Successful items
0.5
3
1.5
Poor
weaknesses
Weak product development
0.8
5
4
Poor
Slowed growth
0.7
3
2.1
Poor
Disgruntled franchises
0.3
2
0.6
Poor
Totals=16.3
Table 2- EFAS scanning of the McDonald’s
External scanning
Politically, the McDonald’s is subjected to government-related regulations in matters pertaining to obesity. However, through lobbies, the McDonald’s are able to maintain their U.S. profit margins. Economically, the McDonald’s has been greatly affected by the recent recession. The recession caused a drop in consumer demand for services and products from the firm. However, the McDonalds were able to weather the storm by focusing on its extroverted standard menu options. Sociologically, the McDonalds has been able to dodge legal and political issues in the United States. However, they have not been able to deal with the negative perceptive of the public about their products. Notably, the Americans have been complaining that the McDonald’s have been the reason behind the escalating level of obesity cases in the country. The McDonald’s has responded to this challenge by phasing out a super-size alternative for all meals in the country. Their food menu has options for salads, milk, and vegetables. In addition, the McDonald’s has unleashed a number of marketing strategies that aim at telling the new variety of healthy alternatives. Technologically, the McDonald’s has been using technological advancements to increase its market penetration. For instance, the firm as a ground for its customers to post their questions uses ‘Ask McDonald’s YouTube’. However, the use of internet has made the company to receive many criticisms from the public. Therefore, the company has to mitigate between the negative effects of internet marketing. Environmentally, the firm has been heavily criticized due to the releases of HCFC-22 to the environment. Severally, the firm has been condemned to contribute to the global warming. However, the company has developed a CSR policy aimed at decreasing impact of the business. On legal matters, Food and Drug Administration relentlessly supervises the firm. The firm smoothen its operations by adhering to the stringent rules from the body.
Weight
Rating
Weighted score
Comment
Opportunities
Growing dining-out market
0.9
5
4.5
Excellent
Respond to social changes
0.7
4
0.8
Poor
Consolidation of retailers
0.4
2
2.8
Fair
Continued CSR
0.5
3
1.5
Poor
Threats
Changing demographics
0.8
5
3.5
Poor
More health-conscious consumers
0.7
3
2.0
Poor
High strength of competition
0.3
2
0.5
Poor
Totals=15.6
Distinctive Strategic Competencies
One of the core competencies of McDonald is that it has a strong brand name that makes it have a greater market size in the share in U.S. markets. Another core competence is that the company has effective advertising and promotional strategies (Xu 2014, p.1017). The company has been using internet cards, caps, T-shirts, and concert tickets to attract and maintain its customers. The company has been using cost leadership strategy to increase its profit margins. This enables the company to keep its prices while cutting down its operational and production costs. Differentiation has been another core competence enjoyed by the corporation in making unique products that are hard to imitate (Hock, Su, Chin, Hooi & Migin 2014, p.1079). This includes such product as McDonald ice cream, which is distinct on its own and cannot be found in any other fast food chain. However, these competitive advantages have not been fully executed for maximum production and satisfaction.
Strategy formulation
The situational analysis will be first used to carry out SWOT analysis and Porter’s Five Forces Analysis of McDonald. Strategy formulation will also encompass reviewing the vision, missions, and strategic objectives. After situational analysis, setting long-term goals comes next. McDonalds uses this step by involving employees in setting the goals (Xu 2014, p.1024). After setting the long-term goals, the remaining step remaining is to choose and appraise suitable strategies to be used by McDonald to meet the set long-term objectives.
Strategy implementation
Strategy implementation follows strategy formulation whereby tasks are shifted to lower and middle level of management (Tschoegl 2009, p.16). Employees are involved in the implementation because they have a clearer observation of the techniques strategized, and they would consequently implement those methods with ease. Using TQM (Total Quality Management) tool, the McDonald’s will be able to provide quality services to its employees, customers, and suppliers.
Strategy evaluation and control
This phase follows strategy implementation whereby the progress of the change is evaluated. This process is endless, and it goes until strategic aims are accomplished. At McDonald, strategic objectives are continuous, for instance, provision of quality services to clients (Gerhardt, Hazen & Lewis 2014, p.104). Evaluation, in this case, will seek to see if customers appreciate the services given. It is at this process that settings are controlled to ensure that the strategy follows the designated route. The evaluation will also constitute how the company reconstructs its brand image.
Overall evaluation of the company
From the internal and external scanning of McDonald, it can be said that internal and external issues affect the strategic management process of McDonald. This comprehensively includes the vision of the company, financial issues, market competition, and technological alterations (Tschoegl 2009, p.18). McDonald has to go alongside technological advancement for it to maintain its competitive advantage. On the matters of the market condition, McDonald’s strategic plan needs to be flexible to meet the altering market conditions. McDonald has established that its strategic management process has to undergo effective formulation, implementation, and control. The shortcomings from the above three steps can be gotten rid off by carrying out a market research of the internal and external factors that affects the firm (Hock, Su, Chin, Hooi & Migin 2014, p.1081). In conclusion, it can be said that McDonald engages in cost leadership and differentiation that enables it to be unique in the market.
Strategic Recommendations
One of the recommendations is that although McDonald has saturated markets in the U.S., it still needs to have market development in its strategic management process. Market development will enable McDonald develop the capacity to attract and retain many customers than its rivals. Having a strong brand does not necessarily means that competition is killed (Gerhardt, Hazen & Lewis 2014, p.111). Rather, it should exploit its resources of food and drinks in the hotel together with service expertise of employees. Another recommendation is that McDonald should appraise flexibility in its strategic management process. The fact that it trains its managers to effective management levels does not mean that clients are satisfied to the maximum (Tschoegl 2009, p.19). Recently, more customers are lamenting that they have been standing in queues for long hours than required. This is because there has been the shortage of employees to serve them. In some instances, the employees are rude to the customers making them go to nearest competitors. Therefore, McDonald should increase the number of its employees to divide the work pressures (Talpau 2011, p.58). Observably, McDonalds focus on inorganic products that are facing criticisms from many Americans. To reverse this trend, McDonald ought to introduce organic foodstuffs. This will permit the company to preserve its market share globally.
In addition, the McDonald’s should increase the number of restaurants to increase its scope of service. Many restaurants will increase the number of customers making the firm more competitive advantageous. Furthermore, the firm needs to maximize profits and sales at the existing restaurants. This goal can only be accomplished through reinvestment and product refinement. Maximization of profits will also be realized through effective marketing strategies topped up with reduction in operation costs. The suppliers and franchises have been the backbone behind the company. Therefore, the more the supporters make profit, the more the firm will also make profit.
McDonald in The US Market Strategic Management Summary
In conclusion, McDonald’s strategic management process has been affected by internal and external factors. To prevent drift in the strategic management process, McDonald needs to emphasis cost leadership and differentiation. In addition, the company needs to carry our extensive market research to innovate new ideas to those of its rivals. The net result will be that the company will maintain its competitive advantage for maximum profits and sales. However, it can be said that McDonald’s strategic management process has been successful so far because of the loyalty it has established with its customers. To maintain this commitment, there is need for an alteration in its strategy to deal with emerging problems.
McDonald in The US Market Strategic Management Reference list
Bernhardt, A, Wilking, C, Gilbert-Diamond, D, Emond, J, & Sargent, J 2015, ‘Children’s recall of fast-food television advertising-testing the adequacy of food marketing regulation’, PLoS ONE, 10, 3, pp.12-21, Retrieved at 01.09.2015 from Database: Business Source Complete.
Crawford, A, Humprises, S, & Geddy, M 2015, ‘McDonald’s: A case study in globalization, Journal of Global Business Issues, 9, 1, pp.11-18, Retrieved at 01.09.2015 from Database: Business Source Complete.
Dabija, D, Christian, P, Postelnicu, C 2015, ‘McDonald’s- Between internationalization and regionalization of restaurant’s value’, Review of Management & Economic Engineering, 14, 1, pp.205-219, Retrieved at 01.09.2015 from Database: Business Source Complete.
Gerhardt, S, Hazen, S, & Lewis, S 2014, ‘Small business marketing strategy based on McDonald’s’, ASBBS e Jornal, 10,1, pp.104-112, Retrieved at 01.09.2015 from Database: Business Source Complete.
Hock, L, Su, Y, Chin, W, Hooi, K, & Migin, M 2014, ‘Improving Queuing at McDonald’s’, AIP Conference Proceedings, 1605, pp.1073-1090, Retrieved at 01.09.2015 from Database: Business Source Complete.
Tschoegl, A 2009, ‘McDonald’s—Much maligned, but an Engine of Economic Development’, Global Economy Journal, 7, 4, pp.16-18, Retrieved at 01.09.2015 from Database: Business Source Complete.
Talpau, B 2011, ‘Customer-oriented marketing- A strategy that guarantees success: Starbucks and McDonalds’, Bulletin of the Transylvania University of Brasov. Series V: Economic Sciences, 4, 1, 51-58, Retrieved at 01.09.2015 from Database: Business Source Complete.
Xu, Y 2014, ‘Understanding CSR from perceptive of Chinese diners: the case of McDonald’s’, International Journal Of Contemporary Hospitality Management, 26, 6, pp.1002-1020, Retrieved at 01.09.2015 from Database: Business Source Complete.
