Get your business on Facebook

Why is Facebook ideal for your business?

Worldwide, there are over 1.65 billion monthly active Facebook users which is a 15 percent increase year over year.  So, you can see that Facebook is an ideal avenue for you to communicate your messages, and so your products or services. Age 25 to 34, with 29.7% of users, is the most common age demographic.  Therefore, if you are targeting the under 34 age group then you need to have a robust Facebook presence.  Indeed, those aged over 34 are also likely to use Facebook in one form or another.  However, as we reach the older age group of 70 plus, it is less likely that they will use Facebook or any form of social media.  So, what do you need to get you going on Facebook? Facebook is popular with most ages

Facebook is popular with most ages

The benefit of creating a hub for your business on Facebook is multifaceted.

  • As Facebook puts it, it makes your business discoverable when people search for you on Facebook they will find you.
  • It connects your business so that you can have one-to-one conversations with your customers, who might like your page, read your post and share them with their friends, and they can check on you every time they visit.
  • Timing is also one of the benefits of Facebook as a social networking tool, since your page can help you reach large groups of people frequently. Messages can be specifically directed to their needs and interests.
  • You can also analyze your page using insightful analytics tools, which give you a deeper understanding of your customers and how successful your marketing activities are.
  • Facebook actually gives you a web like address, which you can put on your business cards, website and on your other marketing tools e.g. www.facebook.com/great-budget-pianos.

Get your business set up on Facebook

The starting point would be a Facebook company page.  You need to do this to a good standard; otherwise potential customers may not take your business seriously.

  1. You need to set up the Facebook profile.  Go to www.facebook.com/pages and login. Click ‘create page.’

Get your business onto FacebookGet your business onto Facebook

  1. You are then presented with a series of choices, based upon what kind of business you have. Therefore, if you are a local business or place, you need to click on the icon for local business with place. Add details of your business, and click ‘Get Started!’

The sign-up process is easy

The sign-up process is easy

3. Complete the section about your company in some detail.  Tell Facebook what categories you trade in.  Finally confirm that your business is a real company.  Essentially complete all other sections and finally click ‘Save Info.’

Tell Facebook about your business

Tell Facebook about your business

4. Next it will ask for a profile picture.  Upload your company logo for an image of your product or service.  Make sure that the image is high quality.  A picture speaks 1000 words!  You might decide to use your logo, or something else that represents your business, for example a picture of you or your idea, product or premises.

5. Adding your new Facebook site to favourites just makes it more easy to access.  It is not absolutely necessary, it is just a matter of convenience for you.

Record the page in your 'favourites'

Record the page in your ‘favourites’

6. The next page invites you to add some information about your business and your customers.  This will help Facebook target your pages, in the same way that Google uses information to help its search engine to rank and prioritise.  Try not to get drawn into any Facebook advertising programs; we are not interested in advertising at this stage.

Your business has a Facebook page.

Your business has a Facebook page.

7. Click through, and wow!  Congratulations, and your small business now has its own Facebook page.  The task now is to build your audience, start a conversation and develop some loyalty amongst your Facebook followers.

What is content marketing?

Content marketing is the management of content to engage visitors, followers and customers. Any medium which is on a webpage or social network can form the basis of content.

There are lots of examples of such tools and approaches; content may relate to material on social networks such as Facebook; it might be social streaming through iTunes or Spotify; content could be social publishing such as blogs or a personal website; it might be social knowledge such as Wikipedia; content media might include social searches such as Google Product Search; there are other examples such as social bookmarking sites including Reddit.

content marketing
Social media content is king!

Therefore, content marketing controls text and video, and other tools such as games, apps, vouchers and so on, so that the visitor is engaged in communication and dialogue; this supports our longer-term relationship.

You will need to address a series of topics in readiness for content marketing.

  • Which platform does our target market use to access content? Do they use traditional newspapers or magazines i.e. traditional print media? Do they use social networks such as Facebook? Do they use more than one platform to access content?
  •  How will they participate with the content which they access? Will they play games? Will they post messages? Will they circulate a viral e-mail?
  • Can content be syndicated? Syndicated content can embed material from elsewhere on a webpage or in an app. RSS is an example of syndication.
  • Which medium would be best to communicate with your target group? This often depends on whether the user accesses content via a tablet or laptop using Wi-Fi, or whether they are using mobile devices, accessing using 4G. Obviously the richness or size of downloaded video, images or text will vary depending on local download speeds; also think about target groups in international markets where speed is variable.
  • Finally, what actually engages your target audience? What content will they actually value? Do they want video? Do they want to download maps? Do they want to pay with their phones or mobile devices? Do they simply need information in text format? Do they want to play games? Do they want to contact friends?

There are plenty of other blogs, lessons and articles on our website to help you extend and develop your content marketing skills for digital marketing.

Marketing for Entrepreneurs, Start-Ups and Small Businesses, by Tim Friesner.

Marketing for Entrepreneurs, Start-Ups and Small Businesses, by Tim Friesner.

People market ideas, products and services for all sorts of reasons; you might want to make the world better for everyone, you might desire recognition for yourself, you might not like working for other people, or you might have found yourself unemployed for a whole range of reasons. That is why you have arrived here, and now you need to develop your marketing knowledge and skills.

This marketing book is written for you. Click here >> Buy it on Amazon. Marketing for Entrepreneurs, Start-Ups and Small Businesses

Marketing for Entrepreneurs, Start-Ups and Small Businesses. Having worked for others and for myself, I have built a whole range of practical marketing skills that you can use today. I have also taught the academic tools, models and concepts of marketing to university students for 20 years, and I have written and delivered marketing training for dozens of entrepreneurs, start-ups and small businesses.

From my experiences, I have learned important lessons about marketing, which are shared with you throughout this book.

Marketing for Entrepreneurs, Start-Ups and Small Businesses is written as a practical guide for new and experienced entrepreneurs and small business people.

It covers the basics on both traditional and digital marketing, and builds to give you a more detailed, practical picture of the topic. You will be able to start marketing immediately.

The book contains current marketing topics including:

Chapter 1 Marketing for you. 1—4

Chapter 2 You and marketing. 2—10

Chapter 3 Know your customers. 3—29

Chapter 4 Your marketing mix. 4—64

Chapter 5 Get your price right 5—76

Chapter 6 Sell yourself 6—87

Chapter 7 Promoting and advertising your start-up. 7—98

Chapter 8 Public Relations (PR) for you. 8—125

Chapter 9 Writing a successful blog for your idea, start-up or small business. 9—132

Chapter 10 Organising your event 10—139

Chapter 11 Getting started with your digital marketing. 11—147

Chapter 12 Your website and online stores. 12—161

Chapter 13 Search Engine Optimisation (SEO) 13—192

Chapter 14 Your social media. 14—199

Chapter 15 Your e-mail marketing. 15—239

Chapter 16 Measuring your online success. 16—246

Chapter 17 International marketing for growing businesses. 17—255

 

 

 

How much digital marketing is enough?

How much digital marketing is enough?

Could you be wasting time, money and effort on too much digital marketing? Let’s look at how you can establish how much digital is enough for your idea, start-up or small business.

With your digital strategy you need to decide how much of your valuable time & resources you are willing to dedicate. In order to do this, there are a series of questions which you need to ask yourself; spend some time thinking about this because the digital world is full of smoke and mirrors. It is suggested that you undertake some basic background research with your current or potential customers. You’ll be surprised how much you can find out. Here are some questions that you can ask:

1. What proportion of your target audience are using different digital platforms? Within this chapter the you will explore the most popular types of websites and social media. The point here is that if your customers prefer to use Twitter then there is little point in focusing on Facebook. So find out what your customers are using, by asking them.

2. Which content and promotions are your audience interested in? Once you know the preferred digital and social media choices of your customers, then review what they’re looking at and try to find out which promotions most interested them. TripAdvisor is an example of this; find current clients and follow the reviews that he or she is placed. This will give you an overview of what they like and what they dislike; similarly look to see if they review car hire or transfers, or whether their comments say they have used particular promotions. What are they sharing on Facebook? Which websites are they talking about on Twitter? You can build quite a detailed image of your customers’ online behaviour, which will help you plan for it.

3. How are competitors using the platforms – benchmark what’s working for them? You may have to become a mystery shopper! It goes without saying that as a small business you will sign up to the digital communications offered by your close competitors. So, how many followers do they have on Facebook and Twitter? What online marketing are they doing using their websites? What seems to be working well for them? Then you can emulate their success, adapt it and then improve it. So a quick audit of your competition is important.

4. Reviewing your own analytics, sales and customer insights. Within this chapter we will discuss online analytics and marketing research; digital marketing leaves a rich trail of data which can be used to analyse and evaluate the success of your campaigns. You need a critical mass of traffic to do this. If your digital approach generates one visitor per day, digital marketing may not be the right route to your customers, and you may prefer to use more traditional promotional methods. However, if you can grow your traffic to 10, 50, 100 or 1000 visitors per day, then you have data which can be used for analysis.

Keep it simple. If you post some interesting content and your traffic increases, then you know you got it right. If you put effort into writing material and there is no noticeable increase in traffic, then you need to change something. You need to deal with this at a basic level. There is a lot of hot air spoken when it comes to digital marketing and you need to be prepared with some basic knowledge to help you overcome the pitfalls. Unless you can justify a huge expense on digital marketing, do not do it! Start small, simple and proficient and go from there.

5. Setting broad goals and vision/mission for the organisation. If digital marketing is central to your business offering, then the online experience needs to have some broad goals and a central vision. So what is your vision? What will your business look like in five years’ time? You can change your vision as time rolls out, but you need a central purpose for your online business. So, what will it be?• Facebook’s mission is to give people the power to share and make the world more open and connected. (Facebook 2016)
• “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.” (Investopedia 2016)
• Coca Cola’s mission is to refresh the world in mind, body and spirit, to inspire moments of optimism and happiness through our brands and actions, and to create value and make a difference. (Coca Cola 2016)

6. Get more specific with SMART objectives (specific/measurable/achievable/realistic/timed). Finally, you need to translate your vision and purpose into SMART the objectives. For example:

• To increase traffic to 10,000 visitors per day within three years.
• To have 30,000 registered e-mail addresses in your opt-in mailing list within 24 months.
• To sell 10 items per day through your online store within six months.
• To achieve 5000 Twitter followers in a single year.

Let’s make sure that you are not doing too much social. It’s important to get as many bangs for your online buck as possible.

20 Networking Tips for Entrepreneurs

Networking for entrepreneurs and small businesspeople often involves meeting new contacts and developing existing relationships. Generally, you will attend a purposefully organised networking event. Look for general networking opportunities in your local trading area, or one organised by your trade/market association. Here are some tips to get you organised so that you make the most of your networking opportunities.

  1. Research the networking event beforehand, and try to find out who will be attending. Visit their websites and try to get some insight into their businesses. Make notes.
  2. Have a wide network. Reach out to others and use every networking opportunity. Target contacts and find out where they meet for networking.
  3. Have an elevator pitch or business summary ready; this means be prepared with few focused sentences to explain in plain language what you do and why you are networking.
  4. Get there on time. Turning up early might give you chance to meet the organisers, and to meet other early-birds.
  5. Be efficient and realistic. Connect with others that are useful to you now, or will be in the future. You don’t have time to connect with everyone, so don’t work the entire room.
  6. Speak with others. Sounds obvious but you are there to network. Try to build rapport quickly. Have an opening question, such as Tell me about your business, explain to me how your business works for customers or describe how you get new customers. Prepare some before you arrive.
  7. Don’t be afraid to listen to other groups, and to join in. If you have something in common, then it is important that you begin the dialogue. Expect others to listen in to your discussion, and to join in too.
  8. Have goals, but keep them reasonable and don’t spread yourself too thinly. For examples, try to make 2 new contacts.
  9. Dress appropriately. If smart dress is required, then dress smartly. If you don’t dress smartly as part of your business’s ideology, then where what make you feel comfortable – within reason of course.
  10. Remember, just be yourself. You are the most important part of your business.
  11. Remember your business cards. Make notes on the cards themselves to remind yourself why you need to network that contact. Only hand out your card to people that will value it; if you have rapport, then ask for a business card from the contact, and expect them to do the same with you.
  12. Give a firm handshake and look the contact in the eye. Smile.
  13. Get your elevator pitch or business summary ready. However, try to not turn the discussion into a sales pitch. You are not selling, you are networking.
  14. Listen to your contact’s elevator pitch or business summary. Ask a question to show that you are engaged and that you understand. Try to be interested in the conversations. Be passionate about your own ideas. Try not to hijack somebody else’s conversation.
  15. Be willing to end the conversation politely. Thank the new contact, and explain that you’d like to meet a few more people during the event. They will understand because they are attending with similar goals.
  16. Perhaps you might be in a position to introduce other networkers to each other. You may form an informal mini-network.
  17. After the meeting or event, review your new contacts. Follow up contacts quickly. Add them to your LinkedIn profile, or add them to your database. Make relevant notes.
  18. Use social media to connect with relevant contacts. As with your business card, don’t try to work everyone. Be efficient and focused.
  19. Once you have connected, develop the relationship. For example, send them a sample; ask them for a meeting, or invite them to become a customer or a supplier.
  20. Why not organise your own networking event? Or, you could volunteer to support an event or networking opportunity organised by others.

Marketing Teacher Content Writers

Do you want to write about marketing?

Marketing Teacher is always looking for experienced and qualified writers to contribute to our website. If you have a lesson or topic in mind please get in touch.

Marketing Teacher Content Writers
Marketing Teacher Content Writers

We are particularly interested in hearing from experienced and qualified marketing lecturers, professors, teachers or practitioners. We will give you credit for your article, and although legal copyright will remain with Marketing Teacher Ltd. You can link to your own social media and tell the marketing education community about yourself. You can even include your own photo.

Please get in touch with Tim Friesner, and tell him about your ideas. We look forward to hearing from you.

*Please note that we do not wish to exchange articles, we do not want content written by professional copy-writers, and definitely no link exchange programmes – covert or otherwise.

Long tail concept

The long tail concept

Let’s go over the concept of long tail and understand what it actually is. The concept was first applied to human behavior by George Kingsley Zipf, professor of linguistics at Harvard. Zipf’s law states that if a collection of items is ranked by popularity the second item will have around half the popularity of the first one and the third item will have about a third of the of the popularity of the first one and so on.

Nowadays, this concept is used to mainly describe niche marketing and the way it operates online. Let’s try and see how online retailers can benefit from this concept. As a rule long tail marketing puts an accent on less popular products, developing a business sales model based upon products in the “long tail.” It is more about inventory management than product promotion. Provision of a greater variety of inventory gives businesses a chance to reach more customers and generate more sales with no extra costs.

Long tail marketing is most effectively employed by online retailers such as Amazon, due to the supply-side considerations of managing such an inventory.  A brick-and-mortar bookstore only has a limited shelf space available, and must devote the biggest part of its shelf space to most popular and demanded products. Less popular items compete with each other for limited space, and of course greater variety increases costs in stocking. The Internet changes that. It allows people to find less popular items and subjects. It turns out that there’s profit in less popular products as well. For instance, Amazon stocks items in warehouses, while displaying them on its website. This surely results in a much lower cost for shelf maintenance. Web-page maintenance has its costs, but they are substantially lower than physically sorting, stocking, and maintaining shelves.

Google SWOT Analysis

GOOGLE

Google Inc. is a tech company that operates globally offering services such as search, advertising, enterprise, operating systems, as well as other hardware products. Employing over 53 000 people, a revenue of over $66 billion was recorded at the end of the year 2014. A net profit of over $14 billion was also recorded which gives about 11.8% increase over the previous year’s profit.

Strengths

Dominance of search engine globally

In the search engine market, Google can be said to have the significant share of the market. Constantly upgrading their search engine technology, they left no chance for their competitors, leaving them behind in popularity. Google still holds the majority of the market shares with despite the efforts of its competitors.

Android’s success is a growth driver in the mobile market

Google acquired Android which broke them into the mobile operating system. Recently, there has been a massive increase in the use of cell phones which has, therefore, provided an excellent platform for Android. Android made use of this opportunity and seized the mobile market-beating its rivals that include BlackBerry, Microsoft, and Apple to become the supreme power in mobile OS. With over 1 billion active users and holding 83% of the market share, there is no doubt about their supremacy.

Being the first Open Handset Alliance’s OS, it is run on a lot of flagships mobile phones from top phone producers such as HTC, Samsung, and the likes, as well as other low end priced phones. Android’s availability to both rich and the poor gives them an advantage over others such as Apple whose OS only operates on a single phone which is quite expensive and inaccessible to the lower income earners.

Weaknesses

Much dependence on advertising

About 90% of the revenue generated by Google yearly comes from advertisements (PPC). The expenditures of companies on adverts depend on a lot of factors which includes the economic condition, the buying patterns as well as the budgeting of the enterprise. Anything affecting the economy can have a negative impact on the demand for advertising which in turn affects the revenue generated by Google.

Limited success of Google’s social networks

Even though Google is leading search engine in the world, they have recorded some failures when it comes to social networks. Their attempts started in 2003, and it has been overshadowed by bigger players in the aspect such as Facebook since they came into play. Their most recent attempt is Google plus which started in 2011.

Opportunities

Core operations have been focused on through structural reorganization

Alphabet was announced in 2015 for the basic improvement strategy of Google. Google will, therefore, be a subsidiary of Alphabet among other companies that will be under the control of Alphabet such as Life Sciences, Calico, among others. This will ensure that its core activities are focused.

Positive outlook for tablet and smartphone market

There is an expected increase in the demand for smartphones and tablets in the coming years. According to statistics, shipments of smartphones will reach 1.7 billion in the year 2018.

Threats

Risk from in-app searches

Recently, consumers have been shifting their attentions to specific apps for their searches. This is a threat to Google’s general web search platform. This will bring a reduction in their traffic and will also take prospective advertisers to those sites as their sites are now more attractive to the users.

Administrative proceedings could impact brand image

There have been allegations against the company about abuse of power. According to The European Commission (EC), the company lowers the ranking of outstanding competitive results. This is only one among numerous allegations against the company.

Intense competition

Google has been on its toes in keeping up with the intense competition coming from different angles. In their line of business, there is the need for the frequent introduction of new services and product. There is competition from every aspect of their business from the search engine to the social networks, as well as other advertising networks using television, radio, and others.

 

Nike SWOT Analysis

NIKE SWOT Analysis

NIKE Inc. is a company that designs, markets and distributes athletic footwear, apparel, and equipment for sports, and they have grown to become one of the largest is their business. Employing over 62 000 people, a total of $30.6 billion was recorded in 2015, which gives an increase of 10.1% over that of the previous year. A total net profit of $3.27 billion was also recorded giving an increase of 21.5% that Nike previously recorded in the year 2014.

Strengths

Dominant market position with a strong brand portfolio

It is no doubt that NIKE is one of the leading suppliers of footwear for athletes all over the world. Controlling about 45% of the market share in the U. S, they were listed as one of the top 30 of 100 most valuable brands in 2016.

Their dominant market position is mainly due to their portfolio of strong brands such as NIKE, Converse, Jordan, and Hurley. Each of the brands specializes in different aspects, for example, the Jordan is more focused on the collection of athletic wear for basketball players.

Focus on R&D activities

This has been one of the primary reasons why they’ve been able to maintain the top position in the business. They focus on technical innovation that brings more comfort, while also reducing injuries for athletes. They also make use of the services of experts in athletes such as the coaches, trainers, and athletes who they consult to produce better products.

Multi-channel approach

NIKE distributes their merchandise through retail stores, but both online and physical as well as other channels. They own a lot of retail stores all over the world, and they also distribute their products through a mix of independent distributors and licensees. In total, NIKE has 592 retail stores all over the world, and they also sell their products through their website www.nike.com. Their multi-channel approach has substantially increased their reach and their customer base in total.

Weaknesses

Dependence on independent contract manufacturers

NIKE largely depends on independent manufacturers outside of United States to supply it fabrics and also to produce most of its products. Hence they have limited control on the quality of their product. Some of the countries where they have contract manufacturers include China, Indonesia, and Vietnam. This means that any mistake on the part of the contract manufacturers affects them too.

Opportunities

Growing global footwear market

Recently, there has been tremendous growth in the total revenue generated from footwear. There was an increase of about 4.8% in total revenue between the years of 2010 and 2014, and there is also a forecast of an increase of about 19.9% between the years 2014 and 2019. Owing to the company’s strong brand portfolio, they are in a good position to take advantage of the growing need for footwear.

Growing online retail channel

There has been a preference to shop online by customers recently. This is evident in the statistics of the amount spent on online stores by citizens of the United States increasing every year and recently at a high rate. A similar trend has also been recorded in Europe in respect to this. With NIKE’s online stores www.nike.com, and www.converse.com, they can turn this in their favor thereby increasing their revenue.

Threats

Growth in counterfeit products

With the increase in internet usage, there is no doubt that there will be a bad side to this. It has aided the full spread of counterfeit product all over the world. The number of IPR seizures made in the United States increases by about 25% within a year, which shows the rate at which counterfeit products are being pumped into the market.

Intense competition

NIKE is involved in one of the most competitive businesses in the United States as well as in the world. With a lot of strong competitors such as Adidas, PUMA, V.F Corporation, NIKE has a lot to do to maintain their position as the leader in the market.

 

 

 

eBay SWOT Analysis

eBAY SWOT Analysis

eBay is an online marketplace where the trade of goods and services takes place globally, and the payment for the services and products takes place as well. It operates in the United States, the UK, as well as other countries. With a current workforce of about 33,500 people, more than 16 billion dollars was generated in revenue in the year 2013, and a net profit of 2 billion dollars was recorded.

The company has a strong market position which has been its major competitive advantage; however, there has been a recent increase in the pressure on internet retailers to collect sales taxes which has been scaring away potential customers from the online store.

Strengths

Efficient business model

The company eBay operates unites both the sellers and the buyers, therefore eliminating the need for intermediaries. The company is also segmented. The main store is eBay.com, while there are other localized ones as well to some countries such as eBay.co.uk. The way the business is structured, also naturally makes it easy for more people to make use of their platform thereby leading to more revenue.

Strong brand value and market position

The company has enjoyed wide recognition as being popular both within the United States and all over the world. Towards the end of the year 2013, there were over 128 million active members of the platform. This shows that they have a larger chunk of the market share of online stores, which therefore gives them a competitive advantage as well as a real bargaining power.

Strong financial results

There was a great increase in the revenue generated in the year 2013 compared to that of 2012 which is evident as there was a 21% increase between the two years. There was an increase in the net profit generated as well. Given their financial strength, this has helped their expansion activities.

Weaknesses

Sales of counterfeit products

As the overall number of sales on eBay increases, so the number of counterfeit goods on the platform also increases. This has led to some lawsuits from notable brands such as Louis Vuitton Malletier, Tiffany & Co, Rolex among others. Only a little could be done by eBay to rectify this, as there is no way they could verify the location of the sellers.

The company has taken responsible for most criminal activities carried out on the platform which leads to more liability on the business’s part.

Opportunities

Rising popularity of online trading

There has been a marked increase in the number of people looking into online shopping over the years. In the United States, in the year 2013, there was an increase of 16.5% over the previous year. A similar trend of growth in the number of people and amount spent on online stores was also seen in other countries such as U.K and others.

Alternative payment systems

Recently, customers prefer to pay through the virtual form of payments such as debit card processing, PayPal, and the likes in place of cash and cards. With the acquisition of PayPal in the year 2002 and other payment platforms, eBay has an edge in respect to this.

Increasing focus on display advertising

In recent years, there has been an improvement in online advertisement. In the year 2012, the internet ad revenue recorded amounts to about $36.6 billion which is an increase of about 15% compared to that of the previous year. This trend was also seen in other countries as well. In 2011, eBay employed the services of Triad Retail Media to help with its display business, and they now manage all the on-site adverts on eBay.com.

Threats

Pressure to collect sales tax on merchandise sold through online websites

In a bid for the government to increase its revenue, it has been putting much pressure on online merchants to pay tax on goods sold online. This has been discouraging a lot of people from patronizing online stores, however.

Increasing internet fraud and the subsequent problem of litigation

Just like most online stores, eBay is open to a lot of online scams such as the sale of fake products, as well as credit card fraud.

 

Social Media Audit

Social Media Audit

The social media audit is an important part of the digital marketing planning process. Social media is an opportunity for consumers to generate their own content, and many of the top-ranking results of an Internet search will result in social media content – in relation to companies, brands, and products and services. User Generated Content (UGC), for example Trip Advisor, is a reliable way of Informing consumers’ decision-making.

social-media-audit
social-media-audit

Why do we need a social media audit?

So what a digital marketer needs is a tool to audit social media within the competitive environment, i.e. relative to competitors. The digital marketer will be trying to work out the best way to ‘feed’ the digital marketing funnel, and he or she will also need to monitor/measure any discussions about his or company. This is where a social media audit fits in.

It’s a systematic examination of social data to help marketers discover, categorize, and evaluate all the social talk about a brand. (Quesenberry 2015)

Keith Quesenberry developed a social Media auditing tool based upon the principle of the Five Ws, which is an approach used in journalism: who, where, what, when and why. If you add ‘How’ then your source is Rudyard Kipling’s poem, The Elephant’s Child:

I keep six honest serving-men
(They taught me all I knew);
Their names are What and Why and When
And How and Where and Who.

Let’s adapt the Five Ms to suit social media marketing, as does Quesenberry. This is Marketing Teacher’s adapted version.

1. Who is creating content using the digital medium? Is it you? Is it an influencer? Is it a competitor?
2. Where is the digital content? Which digital media platform is being used for content? Such as You Tube or Facebook.
3. What is the content on the social media platform? Is it textual content, and video, a photo, is it a story, etc? Does it use a ranking system? What is the feedback like?
4. When was the social media posted? How often does it get posted? What was its reach? Was it shared?
5. Why is the content generated? What was its purpose? Is it a campaign, a complaint or simply a user’s opinion?

The next step is to rank and prioritise your observations based upon these five criteria. How important is it to your social media marketing strategy? Here is Marketing Teacher’s adaptation of Quesenberry’s social media audit. For more detailed information, we recommend that you revisit the original article.

Here are some basic instructions for the social media audit:

1. Please print out the social media audit template from Marketing Teacher.
2. Complete there ‘who’ column. ‘You’ will be your business or your assignment organisation.
3. Then go through ‘where, what, when and why’ and insert the tick symbol (cut and paste the image) to select the appropriate element. You can tailor the audit to suit yourself with the ‘+’ symbol.
4. Finally rank or score the importance of each element using numbers 1-10, or Booz balls. That’s it! It’s time to do your own social media audit.

References

Quesenberry, K. A. (2015) Conducting a social media audit, Harvard Business Review, November 18th, 2015.

TOWS Analysis

What is TOWS Analysis?

TOWS analysis is a tool which is used to generate, compare and select strategies. Strictly speaking it is not the same as SWOT analysis, and it is certainly not a SWOT analysis which focuses on threats and opportunities. This is a popular misconception. TOWS may have similar roots. TOWS is a tool for strategy generation and selection; SWOT analysis is a tool for audit and analysis. One would use a SWOT at the beginning of the planning process, and a TOWS later as you decide upon ways forward.

There is a trade-off between internal and external factors. Strengths and weaknesses are internal factors and opportunities and threats are external factors. This is where our four potential strategies derive their importance. The four TOWS strategies are Strength/Opportunity (SO), Weakness/Opportunity (WO), Strength/Threat (ST) and Weakness/Threat (WT).

TOWS Analysos
TOWS Analysis

Four TOWS strategies

Strength/Opportunity (SO). Here you would use your strengths to exploit opportunities.

Weakness/Opportunity (WO). Indicates that you would find options that overcome weaknesses, and then take advantage of opportunities. So, you mitigate weaknesses, to exploit opportunities.

Strength/Threat (ST). One would exploit strengths to overcome any potential threats.

Weakness/Threat (WT). The final option looks least appealing; after all, would relish using a weakness to overcome a threat? With Weakness/Threat (WT) strategies one is attempting to minimise any weaknesses to avoid possible threat.

TOWS Analysis – Simple Rules.

  1. Like many tools, models, concepts and frameworks, TOWS is subjective. It is only as robust as the data which you include within the model.
  2. Use other models and frameworks to support your strategic choices, such as Ansoff’s Matrix Porters’ Generic Strategies and others.
  3. Strategy will include internal development for growth, merger, acquisitions and joint-ventures.
  4. Be as specific as possible and avoid grey areas.
  5. Always rely on your gut feeling. If it doesn’t feel right, then maybe it isn’t right. Tak another look at simple rule 1 above.

 

What is crowdfunding?

The basics of crowdfunding

By definition, crowdfunding is one strategy for financing a business start up by raising money related commitments from an extensive number of individuals. It is generally accomplished with the use of digital technologies through sites that raise funds; yet the idea can likewise be delivered through other digital technologies such as apps.

Crowdfunding is a technique for raising capital through the aggregate effort of companions, family, clients, and individual financial specialists. This approach takes advantage of the aggregate endeavours of a huge pool of people—principally online by means of web-based social networking and crowdfunding platforms.

Of late, crowdfunding has become more and more popular in the realm of business, be it a start-up or mature organizations. As per, Massolution, a US based research firm, business people have raised billions of dollars with more than 600 crowdfunding platforms, in a range on of online locations. There is no doubt that crowdfunding is digging in for the long haul, and it speaks to a noteworthy new spring of subsidizing for inventive new organizations.

Some examples of crowdfunding platforms

A portion of the various crowdfunding platforms available are Kickstarter, Indiegogo, LendingClub, and Fundable among a few others. On these platforms, gifts are looked for as a by-product of remuneration. While each site offers their one of kind terms, the general idea is the same over every one of the platforms.

Benefits of crowdfunding

Crowdfunding can be used to gather credit and reputation for financing. For instance, the site LendingClub, permits individuals to specifically put resources into and get from one another, removing the bank from the exchange. The thought is to bring entrepreneurs and the financial specialists together. It additionally means to offer organizations shares or proprietorship stakes in the organizations on crowdfunding sites, much the same as a first sale/floatation of stock but without the restrictions.

A fruitful crowdfunding effort furnishes a business with required money, as well as makes a base of clients who feel it is their obligation to support the business since they have a stake in its prosperity.

Why crowdfunding may fail

It could be a colossal exercise in futility if the innovation is not planned properly. It can be terrifying if you meet your objective however then acknowledge you belittled how much cash you required. Your integrity is not just in question here; clients can likewise sue any business that fails to fulfil its promise.

Also, when a business gets supported by a bank or a financial specialist, they furnish businessmen with business mentorship yet they bypass  a major chance for such mentorship when they choose crowdfunding.

 

Factors that can ensure an effective crowdfunding effort

Join with a group of friends, families and supporter who share your business enthusiasm and will help put your struggle into action, giving and encouraging others as well.

Think of a persuasive strategy for success and explain how capital will assist your start-up.

Raise your sincerity level by demonstrating to the general population what you, as an agent have put into the business.

Using UBE a technological company in Texas as a case study of this idea, UBEs central thought is basic, however capable: permit individuals to control and watch their power usage with their cell phone from any place on the planet. Their line of Wi-Fi empowered Smart Dimmers, Smart Plugs and Smart Outlets makes lighting and apparatus control simple and reasonable.

UBE commenced its crusade on Fundable with plenty of enthusiasm, tempting benefactors to get on board and submit over $935k, helping UBE outperform its financing objective and extend the round to oblige intrigued speculators. In just a couple of months, UBE had got $350k in pre-orders, offering more than 5,000 brilliant power units to innovative property holders and organizations the nation over.  The lesson learnt from UBE is that your first benefactors and promoters are there to set the pace for the great support that will follow.

Conclusion

In spite of the fact that subsidizing is most dependably the principle objective of a crowdfunding effort, it can likewise be a positive approach to increase visibility, approve your business, develop your client base, and the sky is the limit from there.

 

Baby Boomers

Baby boomers are the demographic of people who were born just after the Second World War; this would give the baby boomer generation an approximate date of between 1946 and 1964 .  World war two ended in a 1945, and as a rule of thumb baby boomers are the children who are born as the war ended, as families settled down again.

The name baby boomers described many different people , and in this article you must appreciate that it would be too simplistic to over generalise .  Nevertheless, here are some interesting facts about baby boomers. Richard Adler, is Research Affiliate at the Institute for the Future (IFTF) in Palo Alto, CA, where he recently co-led a project on Baby Boomers: The Next 20 Years. Here is his TED Talk.

Baby boomers grew up at peak levels of income, and had a general belief that things would improve over time.  In fact, they did. Baby boomers have worked for almost all of their adult lives , they had good pension schemes , they paid for housing when it was relatively cheap, and many had the opportunity to retire early . They’ve lived for a long time , and they will continue to live for much longer.

Arguably baby boomers thought of themselves as a special generation, at least one which was superior and different to those that proceeded it. 71-76,000,000 American children were born between 1946 and 1964 and this is a relatively high number. In Britain for example, baby boomers held about 80 per cent of the UK’s wealth, and are happy to spend money on holidays and experiences.

Here are some relevant and interesting facts about baby boomers :

  • Born between 1946 and 1964. Two sub-sets:
  • the save-the-world revolutionaries of the ’60s and ’70s;
  • and 2. the party-hardy career climbers (Yuppies) of the ’70s/’80s.
  • The “me” generation.
  • “Rock and roll” music generation.
  • Ushered in the free love and societal “non-violent” protests which triggered violence.
  • Self righteous & self-centred.
  • Buy it now and use credit.
  • Too busy for much neighbourly involvement yet strong desires to reset or change the common values for the good of all.
  • Even though their mothers were generally housewives, responsible for all child rearing, women of this generation began working outside the home in record numbers, thereby changing the entire nation as this was the first generation to have their own children raised in a two-income household where Mom was not omnipresent.
  • The first TV generation.
  • The first divorce generation, where divorce was beginning to be accepted as a tolerable reality.
  • Began accepting homosexuals.
  • Optimistic, driven, team-oriented.
  • Envision technology and innovation as requiring a learning process.
  • Tend to be more positive about authority, hierarchal structure and tradition.
  • One of the largest generations in history with 77 million people.
  • Their ageing will change America almost incomprehensibly; they are the first generation to use the word “retirement” to mean being able to enjoy life after the children have left home. Instead of sitting in a rocking chair, they go skydiving, exercise and take up hobbies, which increases their longevity.
  • The American Youth Culture that began with them is now ending with them and their activism is beginning to re-emerge.

Baby boomers references, eBooks and links

Six living Generations in America

http://www.nytimes.com/pages/booming/

http://www.bbc.co.uk/news/business-38558116

 

 

 

Walt Disney SWOT Analysis 2017

Walt Disney has grown to become a household name both within and beyond the United States. As a current employer of about 185 000 people, the company generated a total revenue of over 52 billion dollars in the year 2015, and a net profit of over 8 billion dollars which is an improvement over what was generated the previous year.

Walt Disney is a worldwide entertainment and media company that has grown to diversify their business over the years. The company currently has a vast customer base, and with the intense competition springing up from other companies, there is the possibility that they are going to be sharing their customer base.

Disney swot
CEO Robert Iger

Company’s strength

Wide coverage of Walt Disney’s cable networks

Walt Disney, without doubt, has a very great cable network that covers a vast area. They operate the ABC Family, Disney Channels Worldwide, and ESPN which is the sports entertainment company that exists in more than 60 countries, and which are also available in four languages.

They also operate the Disney Channels Worldwide cable channel that is in charge of Disney Junior, Disney Cinema, Radio Disney, and others alike. The cable business has over a hundred channels available in about 34 languages and in 163 countries. They have about 123 million subscribers all around the world. Several networks owned by Disney Channels have huge numbers of subscribers running in the millions, their FYI, H2 and LMN had 69 million, 70 million, and 82 million subscribers respectively at the end of the year 2015.

The huge extent and influence of their networks have given them an edge that will take a pretty long time to compete with. Their huge number of subscribers also gave them a very wide margin which is responsible for the high revenue generated every year. They also get to enjoy additional revenue through advertising sales.

Control of strong brands leading to a good market positioning

The company has some of the best media brands in their possession. Some of these brands include Marvel, Pixar, ESPN, Touchstone, and Lucasfilm – that are all known for high-quality content.

Company’s weaknesses

Overdependence on a single region

Even with the way Walt Disney spreads its business across a lot of countries, North America remains its major source of revenue making about 77% of its total revenue from the United States and Canada alone. This makes them vulnerable to the regulation of these areas.

Unfunded pension obligations

Even with the big figures being recorded as their net profits yearly, they still have a net liability amounting to about almost three billion dollars in unpaid pensions.

Opportunities

Increase in the demand of online television and video globally

There has been a major improvement over the years regarding internet services which have brought about the rise in the demand for online video, among others. There will be an estimated $40 billion dollars of business in these areas by the year 2020. Walt Disney has been working their way to reaching more customers through online videos.

Growing gaming market

The increase in internet speed and the advancement in the quality of games have created more growth for the gaming industry. The company has been looking into this lately and has been investing a lot in this regards.

Threats to the company

Increasing rate of piracy

Due to the advancement of technology, piracy of videos and other media has been made quite easy. This has led and will probably result in more losses on the part of the company. It will reduce the revenue generated from the sale of their DVDs, for example.

Intense Competition

There is very high competition in the entertainment industry, which poses a major threat to Walt Disney. There is everything to compete for, ranging from the consumers to the advertisers.

Adobe SWOT Analysis

Adobe is a customer focused business which provides digital products and services to business and individuals. They create innovative tools, many of which are cloud-based, for managing documents at home, school or work. It is one of the largest software businesses in the world, with its headquarters in San Jose, California.

Strengths

Adobe converted its business model to subscription based by introducing adobe creative cloud that allows users to download and install the newest versions of all its products. This step has proved valuable to the company as it increased subscriptions to a significant figure of 78% and increased the subscription revenues.

adobe swot

The company has a world-wide reach with product distributers in all areas across the globe. Its field offices are spread in a wide range of countries. Adobe has made a mark across the world that is good from a financial as well as marketing standpoint.

Adobe has an excellent list of products and services that have and are being used by all areas of the market and on many major operating systems and devices. The company provides remarkable digital media tools that allow businesses to enhance their content. Adobe has also made a name in the digital marketing industry and provides marketing solutions to major players in different industries. Other than that, Adobe’s print and publishing business is also a highly admired service.

Weaknesses

The company’s debt constraints are a major blow to the flexibility of its operations. It puts restrictions planning and possible changes in the company. The debt puts undesirable effects on the financial cash flow and stability.

Opportunity

With the increase in the use of smart phones and the internet the digital marketing industry is growing with an estimated CAGR of 12% by 2020. With its digital marketing services adobe can generate great revenues from the growing marketing industry.

With cloud computing becoming the next big thing worldwide cloud expenditure is expected to increase by 19.4% CAGR by 2020. The company is expected to increase its revenues and consumer base through this opportunity with the help of its Creative Cloud services.

The clientèle and business from Adobe marketing cloud and hopefully other services of Adobe are expected to increase after its deliberate collaboration with Microsoft. Adobe announced Microsoft Azure as the preferred cloud platform for its cloud services, whereas, Microsoft referred to Adobe Marketing Cloud as the preferred marketing solution for its latest products.

Threats

Adobe faces intense competition from many companies for most of its products and services. Many products from open source enterprises pose great threat to the company; for example, the digital media segment of the company faces threat from major social media platforms including Facebook, Twitter and the like. These competitors force price cuttings and restrict profits.

Adobe receives confidential information from its customers that is vulnerable to viruses, malicious software or hackers that may breach the security system of the company. This sensitive information if leaked could be used by third parties in illegal deeds or fraud and could result in a bad reputation and decline in the brand name and customers of the company.

Adobe operates globally and, thus, is prone to foreign exchange currency fluctuations. An estimated amount of 46.9% of its revenue is generated from operations conducted outside of America. These foreign exchange currency fluctuations may be harmful to the financial stability of the company. Adobe has a program that protects it exposure to foreign currency fluctuations but it merely covers a portion of the effects that could occur in a situation of unfavourable foreign currency fluctuations.

Facebook SWOT Analysis

 

Facebook SWOT Analysis

Facebook is a growing social media network that has enabled millions of people to stay connected to each other through posts, photos, videos and much more. It’s a fabulous free social media tool, which keeps the world connected. You can stay in touch with family and friends; you can follow celebrities and politicians; you can advertise your business and undertake a pay-per-click marketing campaign. Let’s look at Facebook’s SWOT – strengths, weaknesses, opportunities and threats.

Facebook SWOT analysis

Strength:

With the growing use of mobile phones and introduction of Facebook app, a precedent increase is seen in the overall usage has occurred. According to FY2015, Facebook had about 169 million daily account users which is a big number as compared to the previous years. It also captured major markets in US, Brazil and India.

Another thing that goes in the favour of Facebook is the fact that it has a loyal customer base, means every user regularly has their personal data and applications set up on Facebook which they regularly update and thus are active users. Thus, Facebook enjoys the status of non-replicable competitive advantage.

Their goal is to offer developments on day to day basis, such that user engagement is achieved at maximum level. This attracts advertisers on the large scale too. Given that Facebook is known for making the user experience better, we see different new products offered by Facebook. The concept of 360 degree photos, Notify and Facebook live are best examples of how well their user engagement has developed over the years by offering innovation.

Facebook has another competitive advantage of collecting lucrative databases. Information regarding the user’s location, interests, connection is valuable for advertisers as they can target the right target audience. The company also has a record of strong financial performance which makes it resilient in the market.

Weakness:

Facebook generates its revenues only through advertisement and thereby it is one of its weak points.  These advertisers allocate a small budget for Facebook advertising and their commitments are also short lived.

Along with that the marketers may not like some of the products offered by Facebook and the may be willing to quitdoing business with Facebook or pay less than the due amount for advertising. The company must sign long term commitment deals with advertisers in order to grow.

Opportunity

Digital marketing is here to stay in business for a while and Facebook is well positioned to gain maximum profits out of it. It is believed by the industry that about shares of U.S digital display ad market will see an increase of 26.9 % by 2017 and Facebook is expected to gain revenues from it.

Target audience marketing for advertisers is one of the strong points for Facebook. Not only does it understand the demographics, interests, activities and connections of its user, it also helps generate the traffic based on offers, news and events. This attracts advertisers on a large level and their most convenient option for advertising, nevertheless, is Facebook.

Mobile advertising is also another opportunity for Facebook. In December 2015, the daily average users for mobile increased to about 25 percent primarily due to introduction of smart phones and tablets. Facebook can earn more profits through mobile advertising, availing this growth in the user base of mobile apps.

Threats

Recently a large number of social sites like Facebook are coming in the front line and have developed strong competition with Facebook. These social sites are developing tools like Facebook applications to engage the consumers and are becoming successful. In addition to that, there are mobile businesses which can provide audience information like Facebook does and are attracting advertisers too. These apps or mobile businesses can be a huge threat for Facebook too. The company is also facing threats from law making agencies for developing products which do not protect user’s privacy and contact details etc.

Another threat for Facebook is the large number of spammers who make the user experience unattractive and a large number of people may leave Facebook due to their unnecessary display of repetitive information.

 

Rocket Internet’s Business Model.

Rocket Internet’s Business Model.

This is an interesting example of where the company bases its business model upon the ability to be second or third to market. Let’s think about this in more detail, because it makes total sense – the first companies to get to market experience the costs and the huge learning curve that is associated with any start-up which enters a new and emerging market. If there is no advantage to being first it to a market, or if the market is new and expanding and has room for many new competitors, then this is a really good business idea. Some would argue that Rocket Internet is a ‘disruptive’ organisation.


The clone factory is based upon Rocket Internet and their business strategy for dominance in Germany and other parts of the world. So the company does not really have a new and innovative idea; essentially it waits and watches how other innovative online and digital start-ups enter new markets, then it quickly invests time and resources in developing its own version of its competitors’ idea, adapting and improving it.

Rocket Internet's Portfolio
Rocket Internet’s Portfolio

By having a vast portfolio of these types of start-ups, rocket Internet has developed a strategy whereby it will see many of the start-ups becoming successes, whilst others will diminish fadeout. The business model will hopefully deliver successful companies in the long-term. Here’s another issue, investors in these companies will want to see returns in the medium, if not the short term. However, these tech companies which may not see a return for many years to come. However, these will be the new cash cows for investors as these markets mature and as customers are satisfied.

Its chairman, the charismatic and future thinking German entrepreneur Oliver Samwer, find himself continually reasoning and explaining the need to think about the medium to long-term. These new businesses are cutting-edge and pioneering. In fairness to Samwer, his companies are disruptive and ‘clone’ is a little misleading.

Some examples of rocket internets new clone businesses include Bonativo (Farmer’s market online), Carmudi (to buy and sell vehicles), EatFirst (super-fast takeaway food), EverJobs (for jobseekers) and Easy Taxi (arguably an Uber clone).
Oliver Samwer Interview – NOAH15 Berlin

SWOT Analysis

SWOT Analysis

SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues. SWOT stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors. Opportunities and threats are external factors. A strength is a positive internal factor. A weakness is a negative internal factor. An opportunity is a positive external factor. A threat is a negative external factor.

SWOT Analysis
Diagram: A SWOT Analysis

We should aim to turn our weaknesses into strengths, and our threats into opportunities. Then finally, SWOT will give managers options to match internal strengths with external opportunities. The outcome should be an increase in ‘value’ for customers – which hopefully will improve our competitive advantage.

The main purpose of the analysis has to be to add value to our products and services so that we can recruit new customers, retain loyal customers, and extend products and services to customer segments over the long-term. If undertaken successfully, we can then increase our Return On Investment (ROI).

Simple rules.

  • Be realistic about the strengths and weaknesses of your organization.
  • It should distinguish between where your organization is today, and where it could be in the future.
  • It should always be specific. Avoid grey areas.
  • Always apply the tool in relation to your competition i.e. better than or worse than your competition.
  • Keep your audit short and simple. Avoid complexity and over analysis
  • It is subjective.

Once key issues have been identified with your SWOT analysis, they feed into marketing objectives. The tool can be used in conjunction with other tools for audit and analysis, such as PEST analysis and Porter’s Five-Forces analysis. So SWOT is a very popular tool with marketing students because it is quick and easy to learn. During the SWOT exercise, list factors in the relevant boxes. It’s that simple. Below are some FREE examples of SWOT analysis – click to go straight to them.

Strengths and weaknesses are internal factors.

For example:

A strength could be:

  • Your specialist marketing expertise.
  • A new, innovative product or service.
  • Location of your business.
  • Quality processes and procedures.
  • Any other aspect of your business that adds value to your product or service.

A weakness could be:

  • Lack of marketing expertise.
  • Undifferentiated products or services (i.e. in relation to your competitors).
  • Location of your business.
  • Poor quality goods or services.
  • Damaged reputation.

Opportunities and threats are external factors.

For example:

An opportunity could be:

  • A developing market such as the Internet.
  • Mergers, joint ventures or strategic alliances.
  • Moving into new market segments that offer improved profits.
  • A new international market.
  • A market vacated by an ineffective competitor.

A threat could be:

  • A new competitor in your home market.
  • Price wars with competitors.
  • A competitor has a new, innovative product or service.
  • Competitors have superior access to channels of distribution.
  • Taxation is introduced on your product or service.

A word of caution – it can be very subjective. Do not rely on SWOT too much. Two people rarely come-up with the same final version of SWOT.  TOWS analysis is extremely similar.

Do you need a more advanced SWOT Analysis?

Some of the problems that you may encounter with SWOT are as a result of one of its key benefits i.e. its flexibility. Since SWOT analysis can be used in a variety of scenarios, it has to be flexible. However this can lead to a number of anomalies. Problems with basic SWOT analysis can be addressed using a more critical POWER SWOT.

History of SWOT Analysis

Having arrived on this page you have probably surfed the Internet and scoured books and journals in search of the history of SWOT Analysis. The simple answer to the question What is SWOT? is that there is no simple answer, and one needs to demonstrate a little academic wisdom in that nobody took the trouble to write the first definitive journal paper or book that announced the birth of SWOT Analysis. There are a number of contrasting, if not contradictory views on the origin of SWOT. Here are a few of the leading thinkers on the topic (and if you have more please let us know so that we can add them). More . . .

FREE SWOT Analysis Examples

A summary of FREE SWOT analyses case studies are outlined in our Lesson Store.

What is Marketing? Marketing definitions.

Marketing definitions

There are many marketing definitions. The better definitions are focused upon market orientation and the satisfaction of customer needs.

Marketing is the social process by which individuals and organizations obtain what they need and want through creating and exchanging value with others.

Kotler and Armstrong (2010).

The definiton is based upon an a basic marketing exchange process, and recognises the importance of value to the customer.

The process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.

Kotler and Armstrong (2010).

Kotler and Armstrong develop their orginal definition to recognise the importance of the longer-term relationship with the customer. This is achieved by relationship marketing and Customer Relationship Management (CRM).

Marketing is the management process for identifying, anticipating and satisfying customer requirements profitably.

The Chartered Institute of Marketing (CIM). Accessed 2012.

The CIM definition looks not only at identifying customer needs, but also satisfying them (short-term) and anticipating them in the future (long-term retention). The definition also states the importance of a process of marketing, with marketing objectives and outcomes. CIM is recognised as being one of the most influential marketing
bodies in the world. It is the professional body for marketing in the United Kingdom.

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. (Approved October 2007)

American Marketing Association Board of Directors. Accessed 2012.

Again, in common with Kotler and Armstrong above, the AMA focuses its definition on value creation and delivery, and the longer-term retained customer.

The enigma of marketing is that it is one of man’s oldest activities and yet it is regarded as the most recent of business disciplines.

Baker (1976).

Baker introduces the elephant in the room. Marketing has always been part of business, and it is a myth that it is purely a contemporary idea.

Also see the Philosophy and Theory of Marketing

SMART Objectives

SMART Objectives

How do you make objectives SMART?

SMART objectives are simple and quick to learn. The objective is the starting point of the marketing plan. Once environmental analyses (such as SWOT, Five Forces Analysis, and PEST) and marketing audit have been conducted, their results will inform SMART objectives. SMART objectives should seek to answer the question ‘Where do we want to go?’. The purposes of SMART objectives include:

  • To enable a company to control its marketing plan.
  • To help to motivate individuals and teams to reach a common goal.
  • To provide an agreed, consistent focus for all functions of an organization.

All objectives should be SMART i.e. Specific, Measurable, Achievable, Realistic, and Timed.

  • Specific – Be precise about what you are going to achieve.
  • Measurable – Quantify your objectives.
  • Achievable – Are you attempting too much?
  • Realistic – Do you have the resources to make the objective happen (men, money, machines, materials, minutes)?
  • Timed – State when you will achieve the objective (within a month? By February 2018?)

Some examples of SMART objectives follow:

1. Profitability Objectives

To achieve a 20% return on capital employed by August 2019.

2. Market Share Objectives

To gain 25% of the market for sports shoes by September 2018

3. Promotional Objectives

To increase awareness of the dangers of AIDS in France from 12% to 25% by June 2017.

To increase trail of X washing powder from 2% to 5% of our target group by January 2019.

4. Objectives for Survival

To survive the current double-dip recession.

5. Objectives for Growth

To increase the size of our Brazilian operation from $200,000 in 2017 to $400,000 in 2018.

6. Objectives for Branding

To make Y brand of bottled beer the preferred brand of 21-28 year old females in North America by February 2017.

There are many examples of SMART objectives. Be careful not to confuse objectives with goals and aims. Goals and aims tend to be more vague and focus on the longer-term. They will not be SMART. However, many SMART objectives start off as aims or goals and therefore they are of equal importance.

 

Marketing mix


The marketing mix

The marketing mix is one of the most famous marketing terms. The marketing mix is the tactical or operational part of a marketing plan. The marketing mix is also called the 4Ps and the 7Ps. The 4Ps are price, place, product and promotion. The services marketing mix is also called the 7Ps and includes the addition of process, people and physical evidence.

The marketing mix is . . . The set of controllable tactical marketing tools – product, price, place, and promotion – that the firm blends to produce the response it wants in the target market.

Kotler and Armstrong (2010).

The concept is simple. Think about another common mix – a cake mix. All cakes contain eggs, milk, flour, and sugar. However, you can alter the final cake by altering the amounts of mix elements contained in it. So for a sweet cake add more sugar!

It is the same with the marketing mix. The offer you make to your customer can be altered by varying the mix elements. So for a high profile brand, increase the focus on promotion and desensitize the weight given to price.

Another way to think about the marketing mix is to use the image of an artist’s palette. The marketer mixes the prime colours (mix elements) in different quantities to deliver a particular final colour. Every hand painted picture is original in some way, as is every marketing mix. Let’s look at the elements of the marketing mix in more detail. Click on the links to go to the lesson on each element.

Price

Price is the amount the consumer must exchange to receive the offering .

Solomon et al (2009).

The company’s goal in terms of price is really to reduce costs through improving manufacturing and efficiency, and most importantly the marketer needs to increase the perceived value of the benefits of its products and services to the buyer or consumer.
There are many ways to price a product. Let’s have a look at some of them and try to understand the best policy/strategy in various
situations.

Place

Place includes company activities that make the product available to target consumers.

Kotler and Armstrong (2010).

Place is also known as channel, distribution, or intermediary. It is the mechanism through which goods and/or services are moved from the manufacturer/ service provider to the user or consumer.

 

Marketing Mix
The Marketing Mix

 

Product

Product means the goods-and-services combination the company offers to the target market.

Kotler and Armstrong (2010).

For many a product is simply the tangible, physical item that we buy or sell. You can also think of the product as intangible i.e. a service.

In order to actively explore the nature of a product further, let’s consider it as three different products – the CORE product, the ACTUAL product, and finally the AUGMENTED product.

The Product Life Cycle (PLC) is based upon the biological life cycle. For example, a seed is planted (introduction); it begins to sprout (growth); it shoots out leaves and puts down roots as it becomes an adult (maturity); after a long period as an adult the plant begins to shrink and die out (decline).

The Customer Life Cycle (CLC) has obvious similarities with the Product Life Cycle (PLC). However, CLC focuses upon the creation and delivery of lifetime value to the customer i.e. looks at the products or services that customers NEED throughout their lives.

Promotion

Promotion includes all of the activities marketers undertake to inform consumers about their products and to encourage potential customers to buy these products.

Solomon et al (2009).

Promotion includes all of the tools available to the marketer for marketing communication. As with Neil H. Borden’s marketing mix, marketing communications has its own promotions mix. Whilst there is no absolute agreement on the specific content of a marketing communications mix, there are many promotions elements that are often included such as sales, advertising, sales promotion, public relations, direct marketing, online communications and personal selling.

Physical Evidence

(Physical evidence is) . . . The environment in which the service is delivered, and where the firm and customer interact, and any tangible components that facilitate performance or communication of the service.

Zeithaml et al (2008)

Physical Evidence is the material part of a service. Strictly speaking there are no physical attributes to a service, so a consumer tends to rely on material cues. There are many examples of physical evidence, including some of the following buildings, equipment, signs and logos, annual accounts and business reports, brochures, your website, and even your business cards.

People

(People are) . . . All human actors who play a part in service delivery and thus influence the buyers’ perceptions; namely, the firm’s personnel, the customer, and other customers in the service environment.

Zeithaml et al (2008).

People are the most important element of any service or experience. Services tend to be produced and consumed at the same moment, and aspects of the customer experience are altered to meet the individual needs of the person consuming it.

Process

Process is) . . . The actual procedures, mechanisms, and flow of activities by which the service is delivered – this service delivery and operating systems.

Zeithaml et al (2008).

There are a number of perceptions of the concept of process within the business and marketing literature. Some see processes as a means to achieve an outcome, for example – to achieve a 30% market share a company implements a marketing planning process. However in reality it is more about the customer interface between the business and consumer and how they deal with each other in a series of steps in stages, i.e. throughout the process.

Marketing Crossword.

Marketing Crossword

This is a free marketing crossword. This example contains many of the basic marketing tools and models that you might find in an essentials of marketing course. Why not post your answers below? Enjoy.

Marketing Crossword

ACROSS
6 What is the topic of this crossword?
7 What do you charge for a product? One of the 4Ps.
8 What analysis contains political and economic, and ends in ST?
9 SMART refers to what?
10 What ‘Life Cycle’?
12 Whose four-celled matrix contains market penetration?

DOWN
1 What is distribution? One of the 4Ps.
2 What is advertising? One of the 4Ps.
3 The ‘what’ mix?
4 Neil H. ‘who’ describes the marketing mix in 1965?
5 Whose four-celled matrix contains cash-cows?
11 What analysis contains opportunities and threats?

Persona marketing (Fictional)

Persona marketing

Using a fictional personality for social media marketing.

Persona marketing is where a business creates a false personality for social media marketing. Some would view the use of false personalities as unethical, whilst others might see it as a form of focused marketing. [If you want to learn how to create a ‘persona’ to give a visual representation of a target customer, please go to personas].
Persona marketing is a rather cutting edge technique for understanding your ideal customers. It’s incredibly involved and complicated, but can be boiled down to a few simple steps:

1. Identify a person of influence that already connects with your target market through social networking websites
2. Understand the kind of content these individuals share that gets the best response from their followers
3. Identify the personality traits of the person of influence
4. Combine the above data to create your own, fictional persona for marketing purposes.

This technique is highly effective and extremely controversial. It involves developing a fictional persona but presenting it as though it is a real person. Managing these personas is a very delicate process. For these reasons it is recommended that you stick to only one persona at a time while mastering the technique.

Where to Find Persons of Influence?

Any social networking or social media website will work. You’re looking for individuals that have large numbers of followers and frequent activity. The best sites are:
1. Facebook
2. Pinterest
3. Twitter
4. Instagram
5. Flickr
With each of these sites you want to find accounts that are frequently creating or introducing content that is liked and shared by large numbers of followers. It can be relatively simple on some sites, like Pinterest, Twitter, and Instagram – each and every piece of content shows how many times it has been shared, even if you’re not a friend or subscriber of the original poster.

Facebook and Flickr are more difficult. You need to become friends with the person of influence in some way before you can find out what they’re sharing and why it’s getting so much interest. It’s also important that you do this so you can learn more about their unique traits – the things that give them the personality that they have.

Digging Deeper into Sample Personas

Once you’ve identified a person of influence you need to dig a bit deeper. Use Klout.com to find out as much as possible. Perform web searches on their name to see if you can find any other information, such as blogs they own and other social networking sites on which they’re active.

As you review all of these resources you need to gather information. Find out as much as you can about them. The more you know the easier it will be for you to create your new fictional persona.

Ideally you find and study three persons of influence before creating your own unique personality for marketing purposes.

What to do with your new marketing persona?

Now that you know exactly what kind of content your prospects find interesting and what kind of person is already sharing it successfully, you can begin to mimic their traits and content trends.
Create a character based on the information that you gathered while doing your research. Mix and match some aspects from each of the three or more individuals you studied. Give this person a name, history, hobbies, and anything else that will help present the image of having a well rounded personality.
From there you can create your social media accounts and begin gaining followers and subscribers.

Don’t promote your products or services too early in the process. You want them to feel that they’re interacting with a person that is absolutely genuine and interested in nothing more than sharing great finds on the web.
As you build a list of followers you can subtly introduce your products or services into the mix. This is the overall goal, after all. If your subscribers and followers are interested in what you’re sharing then they will find your product recommendations interesting, too. Don’t promote them, though. Mention them subtly and link to them. For instance you might post a Facebook status update that reads:
“Wow, I just got my new flip flops from The Hot Flip Flop Shop and they’re awesome!” That’s it. You can link to your site, but it might make more sense to leave it as plain text the first time you introduce it. A few days later you can add a second status that reads:
“Just got a second pair of flops from The Hot Flip Flop Shop because they’re running a sale, check it out… ” This is where you add your link. Don’t be surprised if the traffic comes pouring in.

Is This Ethical?

There’s still a lot of debate about persona marketing. Some feel that it’s unfair and deceptive. Others feel that there’s nothing wrong with it because people are already getting paid to promote products through popular blogs and social networking feeds. False reviews using persona marketing are looked down up e.g Amazon.

 

 

The dilemma only surrounds the fact that it is a fictional personality. You have to decide how you feel about this. One thing that’s certain, though, is that persona marketing provides an amazing and inexpensive opportunity to get your company’s name in front of people who are likely to buy what you’re selling.

Persona

Persona – an innovative and practical marketing tool

What is a persona?

So what is a persona? We all have a personality. We are born somewhere, work somewhere, eat something, like and dislike, hate and love, fear and loath and we love buying certain brands and avoid others. That is the total sum of our personality and this is critical for marketing evaluation information. Based on our personality information and buying preferences, a customer profile is created by marketing specialists, which in turn is instrumental in the formulation of marketing strategies.

Persona Creation

An approach to marketing is persona creation, a combination of raw personal data about buyers and educated guesses to project a virtual image of a classic present or potential buyer. The projected virtual image called a PERSONA is the model on which the whole marketing or advertisement is subsequently focused.

Example – Audi (Europe)

persona
Marketing Persona. Example Audi.

This is how to create one

Creating one is a very business specific concept. Each business creates a persona according to its business goals, values, target customers, future plans and people who buy or don’t buy that business’s products or services. The characteristics of each business persona may be different but the general process of evolving a persona can be somewhat similar.

Devise persona template

The process of  creation generally starts with devising a template which includes images and details about the basic personality traits of the group of customers which are generally placed within a common category based on certain similarities in age, occupations and life style habits. The template helps the marketer to create a virtual image and understand what that particular person likes, dislikes, values and how best to approach that personality. This might subsequently form the basis of a focused tag-line or slogan which must prove irresistible and compel the individual to engage and answer a call to action.

Criteria

Here is a quick overview of what is included in a general template (details may vary depending upon marketing or advertisement objectives in individual business cases). It’s really important to use reliable and robust source data to support your reasoning, in addition to your own experience and ‘gut’ feeling:
1. Name the person
2. A description of Job title
• Key information about their job or workplace (size, type, etc.)
• Key details about their job role and position.
3. Demographic Details
• Age
• Gender
• Subject Salary and household income
• Demographic background e.g. urban, suburban or rural
• Educational status
• Family details
4. Goals and challenges
• Primary goal in life
• Secondary goal which interests the persona individual
• How you help achieve these goals
• Primary challenges in life
• Secondary challenges in life
• How can you help to provide solutions of these problems?
5 Values / fears that drive or hamper
• Primary values which matter
• Common objections which one has during the sales process

Based on this information, a persona of a prospective or present client is created complete with a name and a visual image (sometimes comical).

Marketing message

Devising a marketing message based on the persona’s preferences is the logical conclusion to the persona creation process. The message must address the vulnerabilities, fears, objections and problems of the customer to remain appealing and leave a lasting mark on the persona’s mind.

The last word  . . .

This is a very basic and introductory model of persona creation. In reality, the science of  creation is way more advanced and specialists create marketing campaigns for businesses using this approach as a tool.

 

Referencing

Referencing Marketing Teacher

Why referencing? If you are completing a project or assignment, you must reference all of your sources. Please use the following:

http://www.marketingteacher.com/[INSERT THE FULL URL/WEBPAGE] Accessed [INSERT DATE]

For example:

http://www.marketingteacher.com/swot.htm Accessed August 5th 2028.

The original author is Tim Friesner, unless otherwise stated.

To reference within your text/content – use (MarketingTeacher [Online]), and then include the full citation in your bibliography.

Answer – SWOT Analysis – POWER SWOT

SWOT Analysis – POWER SWOT

Dada Sky Inc.

Answer – Implementing a POWER SWOT

Personal experience.

Vijay has a wealth of business experience which he will put to work for him on this marketing project for Dada. However he will need assistance and advice regarding digital media and satellite technologies. This could mean the recruitment of an experienced assistant marketing manager, the use of a consultant or some marketing research. If an advertising agency is to be recruited, then it too will need expertise in this sector. At some point Vijay might consider some marketing training to consolidate and update his practical experience e.g. an Executive MBA.

Here is the final POWER SWOT for Dada Sky Inc.

Strengths.

  • Dada will be the first to launch its new services in the summer. Being first to market will help it to land grab early customers. Competitors will need to work hard to get them to swap brands especially if they are satisfied with Dada’s offering. 75%
  • Dada has one of three new 25 -year government licenses to supply satellite service across India. It is the only Indian national company to win this prestigious contract and this fact will undoubtedly help the company attract important early adopters keen to support their flag carrier brand. 25%

Weaknesses.

  • Dada is a well-known brand in India for cars. It is not renowned for its technology brands. A rebranding exercise needs to be undertaken. It should emphasize the innovative nature of the brand. A large investment must be considered here. 60%
  • Dada is a well-known brand in India for industrial products. The company is 3 months behind schedule with its launch programme. This could mean that a competitor could launch before Dada. 40%

Opportunities.

  • Huge expansion of TV and Internet access in India. The expansion is growing by 100% per annum. The potential value of such a business could be huge. Services will include telephone, mobile devices, pay-per-view TV, all sorts of channels supplying services such as Bollywood movies to Test Cricket. 80%
  • Education will soon be delivered to remote Indian villages via the Internet and laptops. This is a government funded programme worth $1 billion US. This opportunity will see regular income from the winning provider. As the national brand, this is vital business for Dada. 20%

Threats.

  • A large Australian competitor brand has announced a joint-venture with a national terrestrial TV Indian brand. The Indian TV brand is the most popular independent TV company in the country. This will help the consortium to seamlessly enter the market. 60%
  • A large European competitor brand has also entered the market. The company has years of international satellite experience and can build upon the synergy with its expanding British business. 40%

Final comments…

This is a POWER SWOT Analysis, applied to Dada Sky Inc. A longer POWER SWOT would have more categories and factors within strengths, weaknesses, opportunities and threats. The next stage would be to look at potential marketing objectives and marketing strategies, focusing on the highest ranking factors first.

Order – strengths or weaknesses, opportunities or threats.

A single strength has been changed to a weakness.

Weight.

All elements have been weighted by their importance and impact.

Emphasize detail.

Detail and justification has been added to the analysis so that it is more robust for the marketing decision-making that follows.

Rank and prioritize.

Finally after the detail has been added, elements are ranked and prioritized. This starts with a focus upon marketing opportunities.

Answer – Profit and Loss Statement

Profit and Loss Statement Exercise

Profit and Loss Statement Answer

Fishbourne Marketing

1) Cost of Goods Sold reduces Gross Sales to arrive at Total Income.

2) Net Income would increase by $5,000.

3) Net Income would increase by $5,000.

Profit and Loss Statement

Fishbourne Marketing

January 1, 2014 to December 31, 2014

Income
Gross Sales


$323,789.40
Less Returns and Allowances
$10,000.00
Net Sales
$313,789.40


Cost of Goods
Merchandise
inventory, January 1
$160,000.00
Purchases
$90,000.00
Freight Charges
$2,000.00
Total Merchandise Handled
$252,000.00


Less Inventory, December 31
-$100,000.00
Cost of Goods Sold
$152,000.00


Gross Profit
$161,789.40
Interest Income
$2,500.00
Total Income
$164,289.40


Expenses
Salaries
$50,360.40
Utilities
$5,800.00
Rent
$23,000.00
Office Supplies
$2,250.00
Insurance
$3,900.00
Advertising
$8,650.00
Telephone
$2,700.00
Travel and Entertainment
S$2,550.00
Dues and Subscriptions
$1,100.00
Interest Paid
$2,100.00
Repairs and Maintenance
$1,250.00
Taxes and Licenses
$35,589.00
Total Expenses
$139,289.40


Net Income
$25,000.00


Value Proposition Canvas

Value Proposition Canvas

Let’s investigate the Value Proposition Canvas: a business tool that can help you create, design and implement value propositions. It is a tool which is used by tutors, trainers and business start-ups to look at the ‘fit’ between customers and our products/services. It is used as a bolt-on to the Business Model Canvas, and credit it given here to its creators Ostwalder, Pigneur, Bermarda and Smith  – and Strategyser. It is part of the Lean Start-up Movement. So how does it work?

 

The Value Proposition Canvas

Value proposition canvas has two sides: the customer segment who you intend to create value for and the value proposition which will help you attract customers. The canvas draws a parallel between products and services offered and customer needs. With the customer profile you clarify your customer understanding with value map you describe how you intend to create value for that customer. You achieve fit between the two when one meets the other.
The profile is composed of customer jobs your customers are trying to complete, related pains that picture the negative aspects they may face while trying to complete it and third the gains that show the positive outcomes which your customers may have.

Customer jobs involve functional, social, personal and supporting factors. Customer pains revolve around undesired outcomes, obstacles and risks that can be faced. Customer gains can be classified into required gains, expected gains, desired gains and unexpected gains. Care must be taken to identify the importance of customer jobs, level of severity of pains and relevance of gains obtained.

Now let’s look at the value proposition map that describes the features of a specific value proposition in your model in a more structured and detailed way. It breaks your value proposition down into products and services, pain relievers and gain creators.

Products and services can be tangible, intangible, digital, financial etc. Pain relievers describe how your services and products can soften the specific pains your customers face and gain creators how customers can benefit from your company products and services.

Thus, when the features of your value proposition map perfectly match the characteristics of your customer profile you achieve the fit. Fit can be achieved in three stages:

  1. First when you identify relevant customer pains, jobs and gains to address them with your value proposition.
  2. Second stage presupposes a positive customer feedback and the last stage is about finding a profitable business model.

So, do you feel like having a go at your own Lean Start-up? Begin by completing the Business Model Canvas, and then consider the fit between your products and services using the Value Proposition Canvas.

Five Ws and How of Events Planning

The Five Ws and How of Events Planning

1. Who are your guests? Who is holding the event? How many people are expected to attend? Do any of the attendees need any additional arrangements e.g. the elderly, disabled, or children?
2. What is your event? What sort of event do you intend to hold? Consider your attendees and what might appeal to them. Will the venue be indoors or outdoors? Discuss with delegates:

• Live music and sport
• Festivals and cultural events
• Meeting and conferences
• Incentive travel
• Product launches
• Exhibitions and tradeshows
• Weddings, anniversaries and birthday parties
• Ask delegates for others from their personal/professional experiences

3. When is your event? What is the deadline for your event? Make sure that it will not clash with other events that your delegates may wish to attend. Does the deadline leave you with enough time to plan? How long will the event last – hours/days/weeks, and will it be at a particular time e.g. weekend, Bank Holiday, evening, afternoon or morning?
4. Where is your event? Is it easy to find? Will it be local? Will it be international? Think carefully about the venue that will best suit your event and your delegates. Will you need parking? Will you need to arrange transport?
5. Why is this event happening? What is the purpose of the event? Does your organisation have aims and objectives that need to be achieved? Do you intend to sell any products; create awareness; increase knowledge; build relationships; others?
6. How much money is in your budget? When is the money available? Do you need to consider cash flow? Do you need to pay anyone in cash? Budgeting will be considered in more detail later today.

Answer – Internet Marketing and Promotion: Internet Advertising

Internet Marketing and Promotion: Internet Advertising

Answer – Manor Grange Hotel – Internet Advertising – Recommendations

(a) Online Promotion.

Register for a Google Adwords account, by visiting the Google homepage, and clicking on Advertising Programmes. Cost out a campaign for keywords such as ‘Inverness’ – ‘Scottish Salmon’ – ‘Birds Scotland’ and any others that you consider important to potential visitors.

Of course there will be many other ways to promote your business, which would be contained in a fuller marketing plan – such as rate reductions and special offers at times of low occupancy. The Hotel could also provide free guides on local birds and fishing spots.

You could also consider registering with Yahoo! Search Marketing, perhaps under Local Search – Scotland, Inverness.

You could register your website with Commission Junction. Your site would be attractive to affiliate programme owners such as airlines, and travel companies. This could become a source of additional revenue.

(b) Offline Promotion.

You need to create a media release and send it to tourism magazines and institutions ( those that promote tourism businesses in Scotland).

Keep a record of previous visitors, and mail shot them with news on the Hotel.

Print your domain name on all printer material such as business cars, compliments slips, and brochures.

Digital Advertising

Digital Advertising

Digital advertising, also known as online advertising or Internet advertising, is essentially using the online opportunity to communicate marketing messages to consumers or visitors. There are many new and emerging formats for digital advertising, although it is commonly accepted that it would include e-mail marketing, search engine marketing, social media marketing, more general types of display advertising, and mobile advertising.

There are three main types of digital advertising: paid for advertising such as Google AdWords, acquired advertising such as communications generated through public relations online, and finally company generated advertising whereby the business uses its own blogs, apps and other platforms to communicate.

Online advertising is growing massively all over the world. Display advertising is by far the most popular at this point in time, although the future isn’t written yet.

Display advertising

Display advertising is what we generally think of as online advertising, for example logos, text, graphics, animations or similar. The idea is that users are targeted by specific keywords that appear in search results or on specific webpages. For example if you are interested in information about garden secateurs then you might Google the term ‘secateurs;’ the display results themselves will have adverts about garden tools including secateurs hopefully! If you decide to read a few pages by experts recommending garden tools, then it is likely that they will have small advert placed on their pages whereby they earn a few cents per click. This is essentially display advertising. To be specific there are many types of display advertising and here is a short list;

• web banner advertising i.e. a banner across the top of the page
• pop-ups i.e. adverts that pop up when you open the page, which are less popular due to the annoyance factor
• floating ads which appear and then disappear after a period of time
• text ads which are simple text boxes e.g. Google

Search Engine Marketing (SEM)

Search Engine Marketing or SEM, intends to get your website to the highest position possible in an Internet search. So a marketer intends to improve the position of webpage based upon a typical keyword. Essentially SEM uses marketing approaches to improve the position of a webpage in the SERPS. For example better copy and content, but not really any mechanical or technical changes to a page.

Search Engine Optimisation (SEO)

Search Engine Optimisation or SEO is similar to search engine marketing and the two terms are often interchangeable; however SEO is more involved with the mechanics of the page and its content; for example headings and subheadings, content and keywords, HTML tags in images and videos. SEO has become a huge industry; however it is worth remembering that companies like Google do not disclose their algorithm and so search engine optimisers do not have any special secrets that you could not get from a decent ‘for dummies’ book.

Social Media Marketing

Social media marketing is a technique that employs social media to take advantage of content created by everyday people using easily accessed technologies such as blogs, social networks, Wikis and similar technologies. New technologies and social media marketing emerge almost daily, and it is always worth checking to see how technology is changing and developing. Facebook and Twitter are obvious candidates for social media marketing, as well as linkedIn, Google +, and literally hundreds of new and developing social media platforms. Remember that different countries use different platforms.

Mobile advertising

Mobile advertising is communication delivered through mobile devices such as smartphones and tablets. For example advertising delivered through your iPad or your Android smartphone is mobile advertising. However hear-in lies the dilemma; that whilst mobile devices are small and handheld then there is an argument to develop bespoke content for mobile advertising; however tablets are ideal for looking at traditional websites, and therefore mobile advertising is simply traditional online advertising such as social media marketing, Search Engine Marketing and banner advertising. Also if you read through this website you’ll appreciate that companies want to build long-term relationships with visitors and customers through dialogue and communication, so simply discussing mobile advertising is too superficial. Mobile advertising will surely merge with other forms of digital advertising as time passes.

E-mail advertising

You’ll find plenty of material on Marketing Teacher in relation to email and how it is used in digital marketing. Fundamentally, it is one of the first digital advertising techniques; however today it really suffers a crisis in the wake of perpetual spam bombardment, so many of us are very cautious about how we opt in to e-mail. E-mail marketing and advertising is still a fundamental tool to the marketing manager, especially when it comes to long-term customer relationships. Think about your own e-mail and those companies from whom you welcome e-mails, versus those that you instantly delete. What is the difference in the way the dialogue is maintained between you and the e-mailing company? This is the basis of e-mail advertising and marketing.

There are other forms of Internet and digital advertising which you will find details of on this website. These include but are not limited to affiliate marketing, adware, online public relations and your website itself.

Affiliate Marketing

Affiliate Marketing

Affiliate marketing is basically a process where a brand or supplier, for example a book retailer, attract customers by rewarding the third-party (or affiliate) for marketing their goods and services, and driving traffic to their website.

The affiliate relationship is based upon the conversion; the conversion is the action on the part of the consumer which forms the central reason for the affiliate relationship. The conversion or the action can take a number of forms; so for Amazon this might be the sale of the product; for others it might be the placing of an online bet, or booking a holiday.

Within the affiliate relationship are the merchant, the brand or seller and the consumer or customer. The merchant is the brand or retailer; there are lots of examples such as Amazon and others. In fact today affiliates come from all sorts of companies from any industry, including travel, gaming, smart phones, marketing research, not-for-profit, and the voluntary sector.

The affiliate is your digital salesman. Your digital salesforce owns websites, social media, blogs, mailing lists, and other digital marketing media, and they recruit customers for a merchant. Finally the consumer is at the blunt end of the business; they are the target market or customer and we often talk of a sales funnel which will begin with the affiliate; an obvious example would be a blog which offers advice on weight training, whereby the customer learns how to lift weights, and the blogger recruits you as a customer for weight training books and supplements supplied from the merchant; the website or blog never takes title or owns the products; they take a commission from the merchant.

Benefits of Affiliate Marketing

• everything is tracked and so each stage can be checked by the merchant and the affiliate; this means that both parties are accountable.
• access to many different industries, segments and markets both nationally and internationally means that merchants gain access to channels quickly.
• Marketing to new channels, especially international markets tends to be time-consuming and fairly risky; affiliate marketing is less risky than comparable modes of entry into new channels and overseas markets.

As time moves along and affiliate marketing becomes more commonplace there will be more and more industries and sectors that take advantage of its benefits. There are currently a number of different types of affiliates and will look at a few of these now.

• Voucher code affiliates for example Groupon.
• Social networking sites; Facebook and Twitter now carry advertising and there are affiliate sites which have seized upon this opportunity.
• Retargeting specialists use data from customers that have viewed particular items to try and sell them products from different sectors; this is similar to CRM.
• Paid search specialists essentially use PPC via Google or Bing, to drive traffic to their website based upon keywords for which they bid. Obviously there will be a prophet in terms of sales of product from the merchant less the cost of online advertising.
• Content sites which give information away free to visitors are ideal places for affiliate marketing. For example websites that review college education are often affiliates for colleges and universities.
• Comparison sites are now very popular example Moneysupermarket.com and comparethemarket.com and many others. Essentially these sites compare prices and products from a number of suppliers and display them in one place.
• Loyalty and cashback sites give users and shoppers rewards based upon their shopping behaviour; for example quidco.com.

Affiliate Marketing Process

Affiliate Marketing Process

In a nutshell affiliate marketing as the basic process. The first step is where the user visits the affiliates blog or social media site (website, twitter, and so on), individuals arrive at a purpose-built landing page, receives an e-mail, use their twitter page, use a PPC advertisement, sees a viral advertisement and so on. The user then clicks on the link and is redirected to the merchant’s landing page or product. Often it is difficult to tell that you have left the affiliates website at all; for example Amazon.com allows you to cut and paste examples of books from their website to be placed on your own. There are a number of ways of doing this. Using cookies the merchant and the affiliate workout how many people have clicked through. Finally the consumer or user books a holiday or buys a book; the code embedded on the affiliate website indicates to the merchant where the sales come from and to whom commission is owed.

Some affiliate have quite complex affiliate management software which is accessible by the merchant and the affiliate; for example an affiliate can work out how much money he is making, and can optimise various pages through digital marketing to improve conversion rates.

Digital Marketing Communications.

Digital Marketing Communications.

Digital marketing communications are essentially the digital marketing equivalent of the traditional marketing communications mix. Traditionally the off-line world would employ a marketing communications mix which included public relations, advertising, sponsorship, personal selling, direct marketing, and sales promotion (amongst other tools such as exhibitions, trade shows and so on).

Digital marketing communications will employ some or all of these tools which are adapted to the online marketing challenge. There will of course be new and innovative online tools which are also employed within the digital marketing communications mix. The online equivalents are known as digital media channels, and are employed in many online and off-line campaigns. Digital marketing communications tools will include display ads, pay per click advertising, search engine optimisation, and affiliate marketing amongst others. Marketing teacher will explore these and others, let’s not forget the importance of social media marketing as well.

The Digital Marketing Mix, or Main Types of Media Channels.

Social media marketing

Social media marketing is all marketing which goes on within social networks such as Facebook, Twitter, LinkedIn, MySpace, and many more. For example Facebook has quite a complex social media advertising program, which allows the advertiser to focus on over 1 billion people, based on their location, age and other attributes. There are other sections on marketing teacher with more detail on Facebook advertising programs.

Opt-in e-mail marketing

Opt-in e-mail marketing is exactly what it says on the tin. Visitors or clients are encouraged to opt in, or in other words sign up for an e-mail newsletter. It is that simple! The idea is that participants opt-in with permission, rather than simply being added to a database without their knowledge. This is also known as permission marketing. Again Marketing Teacher has plenty of information to help you learn about e-mail marketing.

Display advertising

Display advertising is often the first type of advertising that springs to mind when thinking about the Internet; display advertising is simply the adverts that you see when you visit any website. Examples could include banner adverts which run across the top of Page, or far more rich and complex adverts such as video adverts; many of the banner adverts and display adverts that you see are part of large programs such as Google AdWords, or similar.

Online PR or Digital PR

Online public relations, or Digital Public Relations (DPR), tend to be digital marketing communications which encourage a positive perception or profile of your business or organisation. There are lessons on public relations on Marketing Teacher if you need a refresher! However the business will be aiming to generate positive blogs, re-tweets, Facebook shares, and similar online PR. Be aware that PR whether online or off-line does have a cost, and public relations is not free. In order to generate favourable content written on your behalf, there is a large investment in terms of effort and cash. Your online public relations might be a mention on a news channel, either in text or video, you might also receive positive commentary on podcasts, although these are becoming less popular. Viral campaigns whereby an interesting or entertaining fact or video is circulated by e-mail or social networks is probably a better example of a contemporary public relations approach. There are examples of viral marketing on Marketing Teacher.

Search engine marketing

Search Engine Marketing, or Search Engine Optimisation SEO, employ marketing tools which attempt to gain the best position possible for your business in search engines such as Google or Bing. Once you have attracted a new visitor, the positioning of text or Calls-To-Action (CTA) will keep a visitor on your site for longer, and will start to move them along your marketing tunnel.

Other online relationships

There are a number of other online relationships which come under the heading of digital marketing, or digital media channels. These will include an array of other approaches. Here are some popular examples:

• Price comparison sites where the cost of holidays, insurance and other consumables are compared. Obviously some comparison sites are more open and honest in terms of the results that they deliver, whilst others are less so.
• Affiliate marketing sites are also quite interesting to study and do tend to generate some niche income from many small sites. Amazon has a very successful affiliate program whereby small site owners can place code upon their site to advertise books which Amazon sources and delivers. So you might have a website which focuses upon market gardening, and you might advertise books which explain how to grow tomatoes.
• Link building is also often considered a way of developing online relationships; however be very cautious with this. Google especially considers strong or informed links to your website as a benefit when deciding upon your position within search results. Obviously many Webmasters have caught on to this and tried different linking strategies to falsely claw their way to the top of the search engine results. All links need to be natural.

Customer Engagement

Customer Engagement in Digital Marketing

Customer engagement is important when thinking in terms of digital marketing channels, or in other words your digital communications mix. The concept of customer engagement relates to continuous and repeating dialogue which goes on between the company and its customers. As the dialogue and communication continues the depth and breadth of customer relationship develops at physical investment, emotional and psychological levels.

So if you managed to attract a customer or visitor to your site for the first time, well done! However challenge for marketers is to engage with visitors so that they become repeat visitors, and loyal customers. Visitors and customers most engage in a continuous dialogue and communication to make custom engagement effective.

The continuous dialogue and communication takes place through blogs and videos, but more likely via social media such as Facebook, Twitter, Google + and others (see other lessons on this website for a fuller list of social media platforms). There are a number of ways in which marketers need to deal with this conversation; for example if a customer goes straight to Facebook to complain about a poor product then you need to be ready to comment as quickly as possible in order to turn a negative into a positive i.e. by reacting quickly will see that your business cares about the customer experience and the media with which they engage.

Customers will comment on blogs, on YouTube videos, on your own website or the website of others, such as Trip Advisor.

Trip Advisor is an example of a third party website which engages customers based upon their experience of hotels, flights, restaurants and similar. It’s the world’s largest travel sites and the argues that enables travellers to plan for the future based upon the goal of the perfect trip. The site itself gets more than 216 million unique monthly visitors, all largely using reviews to inform the basis of their holiday decisions.


So if you have an excellent experience in a particular hotel, you would go to Trip Advisor and post your comments. Others will do the same either negating or emphasising your points. One thing is for sure, business owners take Trip Advisor very seriously. A poor rating might lead to poor bookings and less profits.

Digital Public Relations (DPR)

Digital Public Relations (DPR)

Digital Public Relations (DPR) is the use of digital and social technologies to manage the awareness and understanding, reputation and brand of a company or organisation, through the purposeful influence of exposure via digital media.

Okay, so Digital Public Relations will use many of the typical digital marketing media in order to manage its reputation convincingly; again tools such as content marketing, permission marketing, and customer engagement are central to the public relations purpose. Tools will also be typical and will include social media approaches, blogs, websites as well as traditional media such as newspapers, television and magazines. So one of the key tools of digital public relations is the media release or press release.

Using the digital media, examples of digital public relations techniques will include;

• online speeches
• corporate videos and information about the business such as financial reports

• interviews with senior executives will be recorded and publicised
• events which are broadcast, for example videoconferencing or even using Second Life
• sponsorship and charitable donations which again generate content on news websites or charitable donations via a number of giving websites, for example Cancer Research
• facility visits by the public could be virtual, or visits by the general public might be recorded using Instagram or video, which might be uploaded to YouTube
• publicity events and stunts will also generate user generated content which could be shared using social media, or again media releases will also generate some coverage if picked up by online and off-line sources
• product placement in games or in movies, will also generate public relations material


• if you scour websites or Youtube you will easily find examples of video advertorials which promote products using video, generated by the provider of the good or service.
• Websites and electronic brochures are also obvious but crucial digital public relations tools.
• Lobbying is a controversial digital public relations method; essentially it means that parliamentarians or politicians are lobbied by individuals or companies in order that political perspective is noticed. The National Rifle Association in the United States will use lobbying techniques to persuade politicians of the need for guns, for example. Electronic approaches such as Facebook pages, customer surveys and polls, websites and a plethora of other digital marketing approaches are employed for the purpose of digital lobbying.

Digital Sales Promotion

Digital Sales Promotion

Digital sales promotion encompasses a huge range of creative promotional ideas and approaches. In fact there are too many to list here; so this short lesson on digital sales promotion will give you some ideas, but it is certainly not limited to this small number of approaches. Just think about the multitude of different sales promotion activities that you are exposed to in the everyday terrestrial world, I think that these could be transposed into the digital world or even combined with digital activities.

The online experience is ideal for digital self-promotion. Again many of the topics which are covered in other lessons on Marketing Teacher raised their heads again, it is digital marketing communications is integrated; so yes SEO and SEM can be part of a sales promotion campaign.

Some examples of digital sales promotion:

• free trials and giveaways e.g. some free software for 30 days, and then you must sign up for a full version. Companies such as Spotify are good examples of this.
• you can use social media such as Facebook and Twitter as teasers or as part of the guerrilla marketing campaign; viral campaigns are also ideal when combined with social media and are in themselves digital self promotional tools.
• promotional product or service videos are good examples of self promotional activities.
• product reviews and expert articles in blogs or other online media.
• e-mail can be combined as part of an integrated digital sales campaign.
• product codes and vouchers such as Groupon.com and similar suppliers.
• price-based promotions such as discounts or good old-fashioned Buy One Get One Free (BOGOF) online promotions
• shipping can be undertaken for free as an incentive, for example eBay and Amazon.
• you could offer online only specials if you are a bricks and mortar company.
• contests in competitions online are sometimes popular especially in niche markets.
• valuations such as www.webuyanycar.com is a new and innovative way of creating user interest and self-promotion.
• naturally loyalty programmes and CRM embed sales promotions to retain and communicate with customers.
• there are a reseller promotions and drop shipping incentives whereby services and products from one supplier sold via another online retail organisation.

As you can see from the examples above there are many different and exciting types of sales promotion that can be combined and extended in order to generate new types of digital self-promotion.

Mobile Advertising

Mobile advertising

The smart money in marketing is watching mobile advertising very closely. The main issue is that there are approaches to advertise on mobile phones, but today most mobile or smart phones are more like minicomputers which display the Internet. Consumers don’t make peer-to-peer phone calls in the same way as the devices were intended, but instead use them for communication with social media sites, text messages and e-mail. The smartphones are used for entertainment and for information gathering, and they also generate data themselves such as the geographical position of the user. So as technology develops smartphone usage and consumer behaviour will change, and hence the advertising will focus upon usage in behaviour. For now, here’s a quick summary of the sorts of technology which is available today:

• display ads from mobile websites
• messaging by the Short Message Service (SMS)
• location-based ads based upon a GPS signal
• paid search where advertisers buy links on mobile search engines
• video, providing you have the bandwidth to download them
• potentially voice advertising
• applications via iPhone and Android, and stealth technologies (which is where mobile is likely to go).

Social Media Advertising

Social media advertising

Social media advertising relies upon the relationships generated within social media websites to target and deliver advertising campaigns to users. The advertising itself is more about the mechanics of social media advertising, because you know social media relies upon continuous engagement in communication with users and customers. As with search marketing, the digital world place plenty of information about users and their online habits. So for the purposes of this lesson, let’s have a quick look at how Facebook does social media advertising.

Facebook shows adverts to specific groups of engaged users by their desktop or mobile. The idea is to target your ads with a creative idea, then they get lots of likes, comments and shares. So a successful campaign will target ads at specific groups of people so that they are more likely to see the adverts every time they use their social media platform. As with other forms of marketing communications your Facebook campaign needs a purpose albeit to generate sales, increase brand awareness, target specific groups, or reach specific individuals.

As with Google there are a number of different types of adverts that can be shown in different places; and can be shown in various positions on page or in a newsfeed, or other places depending on who you are targeting or the types of devices using. You have the option to target based upon a series of factors such as location, age, gender, interests such as tennis or cookery, broader categories such as parents, or a variety of other related connections such as those who like or share your page. So based upon these factors you are more likely to target specific consumers.

Facebook offers a very interactive user interface, and you can get started very quickly with your advertising campaign. You might employ a social media advertising agency if you have the resources, but creating your own advert is very straightforward using Facebook’s ad create tool. Other social media platforms such as Twitter, have similar approaches to social media advertising.

Banner Advertising

Banner advertising

Banner advertising has its roots in the early Internet. Early websites would have a section at the top like a masthead which would contain an advert; these would be the first things that consumers would see, and from a practical point of view they were easy to insert. Banners then went on to include skyscrapers and similar, which are simply vertical banners. Today most banner type advertising is simply PPC served through third-party advertising companies such as Google, Microsoft and Yahoo!

Display Advertising

Display advertising

Display advertising is where an advertiser places an advert on somebody else’s website, in the search engine results or via a third-party advertising system such as Google AdWords.

Third-party advertising systems

Most popular today are third-party advertising systems such as Google Adwords whereby ads are served from a hosting system onto a particular section on a web page or site. For more information on search marketing and SEO take a look at other lessons on the Marketing Teacher website. The advert once clicked will take the visitor through to the website landing page, or to a specifically designed microsite [which is purposely designed sub-website, specifically designed for promotional purposes]; these are the typical banner type ads, social media advertisements, and mobile adverts that everyone is used to seeing on the Internet today.

Display advertising is direct

Display advertising gives the advertiser a direct response i.e. the user or visitor will go straight from the advert to the advertiser’s website or microsite. This obviously has a number of advantages over traditional media where the channel is much longer and time-consuming. Also adverts are seen but not clicked upon and this gives the advantage of disseminating your brand to enhance awareness and interest. Also the online ads can be mixed and integrated with other online and off-line promotional activities. Display advertising can be highly targeted and costed, and advertisers can make adjustments and changes to any campaign based on data received during the last campaign.

However you need to be careful that your brand doesn’t get associated with less desirable elements of the Internet; also display advertising may not be right to your own business, for example if you are a local plumber local trade directories might be better, and will target audience may not use digital devices. Also bear in mind that online users and consumers are wise to online advertising and that sometimes click through rates may be comparatively low or relatively expensive.

See also:

Banner advertising
Social media advertising
Mobile advertising
Display advertising formats

Content Marketing

Content Marketing

Content marketing is the management of content to engage visitors and customers. So any medium which is on a webpage or social network can form the basis of content.

There are lots of examples of such tools and approaches; content my relate to material on a social networks such as Facebook; it might be social streaming through iTunes or Spotify; content could be social publishing such as blogs or a personal website; it might be social knowledge such as Wikipedia; content media might include social search such as Google Product Search; there are other examples such as social bookmarking sites including delicious and Reddit.

So content marketing controls text and video, and other tools such as games, maps, vouchers and so on, so that the visitor is engaged in communication and dialogue; this supports our longer term relationship.

The marketer needs to address a series of topics in readiness for content marketing.

  • Which platform does our target market used to access content? Do they use traditional newspapers or magazines i.e. traditional print media? Do they use social networks such as Facebook? Do they use more than one platform to access content?
  • How will they participate with the content which they access? Will they play games? While they post messages? Will they circulate a viral e-mail?
  • Can content be syndicated? Syndicated content can embed material from elsewhere on a webpage or in an app. RSS is an example of syndication.
  • Which medium would be best to communicate with your target group? This often depends on whether the user accesses content via a tablet or laptop using Wi-Fi, or whether they are using mobile devices accessing using 4G. Obviously the richness or size of downloaded video, images or text will vary depending on local download speeds; also think about target groups in international markets where speed is variable.
  • Finally what actually engages your target audience? What content will they actually value? Do they want video? Do they want to download maps? Do they want to pay with their phones or mobile devices? Do they simply information in text format? Do they want to play games? Do they want to contact friends? This is a far reaching question deserving of thought and preparation on the part of the marketing manager.

Exercise – Consumer Buyer Behaviour

Consumer Buyer Behaviour

The Buyer Decision Process

Here’s a recap: If a marketer can identify consumer buyer behaviour, he or she will be in a better position to target products and services at them. Buyer behaviour is focused upon the needs of individuals, groups and organisations.

  • Make decision.
  • Action.
  • Post-purchase behaviour i.e. did it meet your expectations? Did you use it? Was it reliable? Etc.

It is important to understand the relevance of human needs to buyer behaviour (remember, marketing is about satisfying needs).

Describe the Buying Decision Process for a mobile/smartphone. Fit your description around the five stages that follow:

  • Recognition of a need.
  • Choice of level of involvement (i.e. justifying you time and effort e.g. low for bubble gum, high for a holiday).
  • Identification of alternatives.

Permission Marketing

Permission Marketing

Permission marketing is a term calling by Seth Godin (1999) in his successful book called Permission Marketing. (In fact there is a free of charge copy of the full audio book below). The concept of permission marketing is very simple; your visitors or customers agree to opt-in, or sign-up to participate in your organisation’s marketing conversation. In the past this would have been a simple agreement to receive an e-mail newsletter, and the permission element simply meant that the visitors agreed that he could use his or her e-mail address (the more unscrupulous would simply help themselves to your address).

Today’s marketing online is more about long-term customer relationships, communication, conversation and discussion. This is participation.

The argument in Godin’s book centres on the fact that as consumers were exposed to more than 3000 marketing communications messages everyday. Just think about it, every time you go to the store you see thousands of brands; each time you open your e-mail there is unsolicited communication from all sorts of organisations; each time you look at the website there will be banners and other marketing messages. Therefore to breakthrough the background noise, the permission marketer builds a relationship with his consumer via a dialogue. An excellent example of this is ASOS.

ASOS is a global fashion and beauty retailer; it was originally based upon the concept of As Seen On Screen, whereby you would see a movie and seek out similar products. However the brand has come a long way since then. ASOS uses permission marketing to engage customers on their website and uses social media. Products can be viewed in different colours and sizes, and there is information about the product itself and how to look after it; then consumers can tweet about it, pin it, Facebook like it or e-mail a friend. This is all part of the permission conversation.

Please take a listen to Seth Goden’s reading of his own book, Permission Marketing.

Search Engine Optimization

Search Engine Optimization

Search Engine Optimization (SEO) is commonly seen as the golden key to huge amounts of website traffic. Marketers need to be aware that SEO is a structured process that on many occasions will improve the amount of traffic that you get your site, but that there is no magic formula to success.

Think about it this way; if you are a lawyer in a small town in Arizona, a town with only three lawyers, then your chances of getting a high position in the search rankings is fairly good if you optimise your site (in fact even if you don’t!). There are only three lawyers therefore you should get a top-10 space. However if you are a lawyer in New York City, you are in a much more competitive environment. Where there are thousands of lawyers and law firms even if you have the services of the best SEO expert, your chances of getting a top space are remote. In this situation you are better off paying for a placement or sponsored link. Most webmaster design their SEO for Google.

The rest of this lesson will look at SEO, with an invaluable tip regarding Google at the bottom of this page; something to look forward to.

  • Content is king! It makes sense that the material that your users want to read should be the most important aspect of any webpage. Make your content compelling, make the content unique, make it relevant and informative, and make sure that your doing something original and engaging for your readers. The point here is don’t try and trick the search engines; if it is something that people want to read, then in an ideal world it will rank highly in the search engines.
  • Keywords are they skeleton of any good content. Keywords do tend to stimulate much debate within the SEO community. The advice has to be to write your content naturally and not to over pepper the text with too much repetition of specific keywords. However the search engines are not intelligent enough to be able to interpret specific nuances, so use your keywords and some synonyms but keep it clear and concise.
  • Links are almost as important as content, especially when dealing with Google. The Google algorithm is probably the holy Grail of any SEO expert, because obviously Google is the largest and most intuitive search engine, and its pay per click service can be quite profitable. However don’t forget the other search engines such as Bing.com and Ask.com (amongst others); since it becoming quite reassuring that your website ranked highly in more traditional search engines.

Matt Cutts, Google’s Head of Spam, is a respected sage on the topic of SEO development;

  • The idea is that links are almost like votes; so the more links you get more highly your website will rank – right? Well in fact no. The most powerful links come from respected websites e.g. CNN or the BBC, universities or well-respected government organisations. However links from less reputable websites will have the opposite effect, and in fact Google will penalise website if there are too many less reputable links. Problem is how to get rid of these links, especially if they come from an aggressive competitor. This is another ongoing debate with Google. So try to generate authoritative links from robust sources. Again you need to generate truly valuable content that other sites will want to link to; inform other websites that your site exists; you could create your own blog so that readers want to return to read your new content; in effect you need to market yourself and your site.
  • Search engines will find you. These days you don’t need to submit your site to search engines. However you need to make it as simple as possible for the bots to find you and to crawl your site. One commonly accepted way of doing this is via sitemaps (www.sitemaps.org). A sitemap is an XML file list URLs and some of their metadata  In other words a sitemap navigates the search engine around the best bits of your site and offers some details about each page.
  • There are more mechanical aspects to consider such as H1 tags and titles; however to be honest these days they matter less and less. As long as your site is correctly engineered then it will rank. WordPress is an ideal example of this and there are other content management sites available such as Drupal, WolfCMs and more.
  • Let’s dispel some more SEO myths; there is no ideal length for a page in terms of words; focus on popular keywords, since the long-thin-tail is full of keywords that nobody searches for; H tags don’t really affect ranking (i.e. headings and sub-headings) just keep clear and concise; if you buy links, Google will not throw you out and in fact it won’t be that interested; you don’t need to update your site frequently – if it is contemporary it will rank; despite my earlier point, the lack of a sitemap isn’t a problem because the search engines will find you; finally you don’t need to submit your site to any search engine.
  • Try to follow Matt Cutts; he’s the Head of Spam for Google and he offers many clear and simple videos on what’s hot and what not to worry about in relation to Google’s search engine.

 

Search Marketing

Search Marketing

Search marketing can include many aspects of digital marketing and traditional marketing, although it is generally seen to encompass paid placements, Pay-Per-Click (PPC) and Search Engine Optimization (SEO). Since SEO is covered in another lesson, we’ll focus upon paid search and pay-per-click.

Paid Search and Pay-Per-Click PPC

The perception of SEO is that in some way it’s free, although companies invest a lot of time and resource in this process; despite this it is still extremely popular. In reality the most direct route to gaining a high rank in any search engine is via a paid search, using an approach such as Pay Per Click (PPC). The most popular approach to PPC is via either Google AdWords or Microsoft Bing and Yahoo! (Yahoo! uses Microsoft’s search).

PPC has quite a few similarities to traditional advertising in the way that you pay for an advertising position; you will have seen paid search whenever you do a Google search for a popular keyword term for example Christmas. At the top of the results, and along the side of any results you will see a series of paid for or sponsored adverts; these all belong to Google and are paid for by its advertisers. So if you want a prime position on some search results then you pay for search using PPC. Most people today will to look for the natural search results, although many don’t; in fact some prefer to click on the adverts in order to find products, services and solutions that meet their needs.

You do not pay for the advert until somebody clicks on it. So for a popular keyword it might cost between $.10 or $10 per click, and the advertiser essentially specifies the amount that he wishes to spend and pays Google in advance; it’s a great business model and this is why Google make so much money; it provides an easy-to-use, targetable and measurable advertising campaign solution.

Again there are many informative videos on the topic:

The position of your PPC advert generally relates to the amount that you bid; the more you pay the higher you rank, at least in theory. However others believe that the way that the advertisement is composed might make it more attractive than some of its competing ads; therefore a more popular advert in terms of click through rate might rank higher and therefore make more money.

As with much digital marketing, because it is fairly new search marketing has a number of pros and cons:

Search marketing advantages:

• if users, do not click on adverts often they will be read them anyway; this means that you are getting your brand in front of a big audience and perhaps not paying for it via a single click.
• you can have your adverts in front of your customers quickly. Speed is a huge benefit this kind of advertising, since you don’t have to wait for a newspaper to be published and distributed for example.
• Cookies can be used by Google; after you click on an advert marker placed on your computer so that the next time you visit the Internet and are exposed to Google ads, specific adverts can be targeted at you; it remembers you!
• The algorithm for search marketing is largely based on the price that you bid, versus click through rates/quality of your advert; it is far more straightforward than the more complex algorithm for SEO.
• You know that you will be able to see your advert on a Google search using PPC, since it is far more reliable than trying to predict search engine behaviour.
• Using software, you can directly workout your return on investment based upon search advertising.
• Google AdWords is highly targetable and it is supported using software that can be straightforward and simple for some users, and more technically advanced for larger more informed users. Companies can target by time-of-day, geographical location, keywords and keyword groups, as well as other more refined targeting approaches.
• unlike traditional advertising, you are not actually paying the advert to be displayed as you would in a magazine, for example. So there may be many exposures which might create awareness or desire, before a user actually clicks through and you pay; this is an extra added value dividend to the advertiser.

Search marketing disadvantages:

• Today users are far more wise to search marketing techniques. If your advert is not compelling users will consider it irrelevant; in fact in some keyword groups the adverts are more relevant than others.
• the PPC accounts are so complex that you might spend a disproportionate amount of time working on the nuances and tweaking your campaign.
• therefore the more complex campaign needs specialist knowledge and skills to be effective, and this is an additional cost to your advertising campaign.
• For some businesses which are small or which have a low turnover, PPC might not be useful; advertising in local magazines or newspapers might be far more cost-effective.
• Beware! Some keywords and niches are very expensive, and at popular times when keywords become competitive one can spend a disproportionate amount on advertising online.

Social Networks

Social networks

Social networks are a very important digital marketing channel, so it is important that marketers understand the essentials of social networking. They are particularly important when creating a community, based on communication and dialogue with our customers. This lesson will cover the basics of Facebook, Twitter, LinkedIn, Google + and YouTube Channels. The social network might be for your brand, product or service, or it might be for your own personal networking.

Facebook

The starting point would be a Facebook company page. The benefit of creating a hub for your business on Facebook is multifaceted. As Facebook puts it, it makes your business discoverable when people search for you on Facebook they will find you. It connects your business so that you can have one-to-one conversations with your customers, who might like your page, read your post and share them with their friends, and they can check on you every time they visit. Timing is also one of the benefits of Facebook as a social networking tool, since your page can help you reach large groups of people frequently, messages which are specifically directed to their needs and interests. You can also analyze your page using insightful analytics tools, which give you a deeper understanding of your customers and how successful your marketing activities are. Facebook actually gives you a web like address, which you can put on your business cards, website and on your other marketing tools e.g. www.facebook.com/marketingteacher .

Twitter

As with other social networks, twitter takes its business pages seriously. Twitter can help you connect your business to what people are talking about at the moment. Twitter offers a social media for people to talk about what they care about as well as what’s happening around them at the moment and this is a dialogue in which your business needs to be a main player. So twitter offers you a powerful medium to connect your message to what your customers are talking about in real-time.

  • You can listen and learn from what your competitors are tweeting or you can look for list of industry keywords to help you gather intelligence. This gives you an insight into how you may adapt your social media strategy.
  • As a medium social networks and twitter are tools that will help you grow your business; you can run innovative promotions, develop your brand and have an engaging an ongoing dialogue with your customers (and you can use twitter ad as part of your campaign)

You have 140 characters to get your point of view across; and your campaign can be innovative and maybe even viral (see the other lessons :-). For example American Express lets people use their card numbers to claim gifts such as travel tickets; companies such as Burberry are very innovative when it comes to social media, where one example would be their #Tweetwalk fashion show.

LinkedIn

LinkedIn company pages allow you to showcase your business and to target your audience; you may even have personal pages for yourself or your marketing team. Initially you would create a company page by entering your name and company e-mail address – it’s that simple. Then you simply verify that you are eligible to create a page on your company’s behalf. You create a company profile by offering a company description and overview; this needs to be quite short and salient and it needs to show what your company does, why it is different and what it specialises in.

You would then add a banner and your logo to tailor the LinkedIn company page with your own branding; the logo will appear when other LinkedIn members search for your company and it will appear on your employees’ profiles. You might add your employees as followers in the first instance and encouraged them to add your company to their own profiles, which starts to give it a viral focus. You can add your company profile to other marketing channels such as websites, e-mails and newsletters.

Followers are your influencers and your customers, and LinkedIn will encourage you to invest time and resources to establish a robust follower base. Then as with other social networking tools you need to devise rich content to share with your followers; this means that you are beginning your dialogue. For example by posting company updates you start your conversation and word of mouth marketing begins to develop engagement; you can check company news, articles and even hot topics.

Google +

Google + is Google’s main social media offering. It is a very powerful tool for social networking, but it has more to it than Facebook and Twitter, since it links together all of Google’s services for a unique experience. Hence the next section on YouTube is closely aligned to this discussion since Google owns YouTube.

So there are pages specifically designed for businesses on Google +. There are simple series of steps to get going;

  • firstly you choose an accessible Gmail account for your business
    then you create your own page using your Gmail account, and you’re able to select your business location, discuss your
  • products or brands, explained about your company as an organisation, and there are other things that you can leave information about
  • you need to customise your public profile. You can include your tagline and an image or logo. Then as with other types of social media you can promote your page by creating a series of networked circles.
  • Finally you launch your page and measure and adapt your social media strategy.

YouTube Channels

You Tube channels give your business the opportunity to record and publicise videos. It might be advisable at this stage to use the same Gmail account as you did for Google +; it’s likely the Google will automatically integrate the accounts, so trying to keep them separate is probably pointless. The medium gives you the opportunity to network with more than 1 billion people worldwide who visit YouTube monthly. So you need to ask yourself what you want to get from YouTube and integrate it into your marketing communications plan.

  • Set yourself goals in relation to what you want the channel to achieve
  • decide on how best to adapt the you Tube channel to suit your corporate identity; for example you can customise channel background and add logos and details about your organisation
  • you may need commercial products such as Camtasia or Sony Vegas (or one of many other options) to record your videos
  • you may wish to employee company to film and edit your videos, or you might want to give it a personal touch and do it yourself
  • once the videos uploaded think carefully about how you describe the video and the tags you use; they need to appeal to your target audience
  • you can organise your video content as individual videos or playlists based on particular topics or themes; again think about how your users will want to access the videos
  • you will probably want to allow comments on your YouTube videos, and if so you will need to make sure that your business is checking comments regularly and that it feeds back on all comments as quickly as possible; it’s all part of the global dialogue with users. If comments cannot be managed and switch them off, although viral marketing needs comments to fuel the fire.
  • as with other forms of social media you can promote them on your website or through any other channels which you use regularly, or you could use Google AdWords or similar PPC solutions.
  • YouTube has very detailed Analytics, so you can measure reactions to any changes you might make to your social media campaign.

Finally you may wish to coordinate the usage of your social media approaches, and for this you need a social media management tool such as;

Viral Marketing

Viral marketing

Viral marketing is the equivalent of online word-of-mouth. Viral marketing, aka Buzz marketing, uses all of the digital marketing media to disseminate a message which is passed along from person to person; it’s viral because it spreads like a virus or disease and if successful communications can expand exponentially.

Viral marketing campaigns are often spread via e-mail or social media (and here we include YouTube as well). The campaign can reach a large number of individuals in a relatively small amount of time, and marketers seek to harness this very powerful effect. So when planning an integrated marketing communications campaign today’s marketers will take into account viral marketing.

There are a number of mechanisms that can be used for viral marketing, which are known as agents, mechanics or execution types; these include, but are certainly not limited to, images, jokes, quizzes, video clips, games, e-cards, micro-sites, and others.

Example – Heineken India – Viral Marketing Campaign.

Viral marketing will help a business boost a cost-effective amount of brand awareness, and it could also plant the seeds for consumer awareness or interest in an alternative marketing communications campaign; for example it could be a teaser campaign. Other benefits include:

  • viral marketing will extend other communications activities
  • it will help you to reinforce, reinvent, and remind customers of existing or previous campaigns
  • it will help amplify and extend the messages, and because it’s viral there is a novelty value to the campaign
  • of course in relation to word-of-mouth marketing, there is a buzz which surround your campaign too
    you will also reach beyond your organisation’s core market.

Conversely there are disadvantages to viral marketing, some of which are listed here:

  • once the campaign started you cannot control it: a TV campaign can be stopped but a digital viral campaign cannot
  • you cannot control when it starts and when it stops, or when it accelerates
  • you cannot control the reach, and you may be communicating with segments who you would not generally target; this is
  • wasteful but also means that you could be damaging your brand
  • the viral might be taken out of context; the word-of-mouth effect could be perpetuating a problem, and it might be the problem which is the sole reason why the viral is successful.

What makes a successful viral?

  • They can be funny.
  • Virals can be outrageous
  • It has a unique or controversial approach
  • Culture can be challenged such as sex or religion
  • Try something that has no connection with your product.

Example – Viral Marketing – Jimmy Kimmel

Digital Personal Selling

Digital Personal Selling

Digital personal selling is an exciting and emerging opportunity for the marketing organization. Let’s look at how you can use it, and the Digital Selling Process. Personal selling generally happens when a person sells a product, service or solution to another person or organisation; therefore there has to be a degree of one-to-one, simultaneous, asymmetric communication in order that personal selling can happen. The digital opportunity provides salespeople with the chance to exploit two key areas – direct digital communication and digital information.

The Digital Selling Process

As discussed in another lesson on marketing teacher, traditional personal selling can be thought of as a five stage process:

• Stage One – Prospecting
• Stage Two – Making First Contact
• Stage Three – The Sales Call
• Stage Four – Objection Handling
• Stage Five – Closing The Sale

So at each stage the digital salesperson needs to decide whether he or she will use the digital marketing opportunity to either gather information to make decisions, or to communicate in order to see through the five stages of the personal selling process. The Internet is ideal for prospecting!

Digital Prospecting

The salesperson can prospect using popular search engines such as Google, Bing or Yahoo. Such searches can generate postcode data (ZIP codes) which can then give an indication of property prices, the level and nature of wealth in an area, people’s professions and levels of education, and much more. Then of course there will be online databases that can be used and refined in order to start the sales process.

Making First Contact for Digital Personal Selling

Making first contact used to be by telephone, letter or personal visit. Digital marketing gives the opportunity to the digital salesperson to use an array of first contact tools for communication; the digital salesperson might use targeted e-mails, social media messages, or social networking using platforms such as LinkedIn.

Digital Personal Selling: The Sales Call.

The sales call traditionally is face-to-face, or by telephone. The digital salesperson could use a whole series of blended approaches to communicate with the potential prospect; for example he or she might use Skype or video conferencing software such as Cisco’s WebEx or Adobe connect (there are many others, some of them free). The more adventurous digital salesperson might even use Second Life and undertake personal selling using an automaton or avatar. There’s also software which recognises when a potential prospect views a website; the software will pop up and give the opportunity to the potential client to gain more information; this is the beginning of the next stage of the sales process, and traditional sales approaches such as objection handling, and closing the sale will apply.

Software and the Digital Sales-force

Software also gives the opportunity to control digital sales forces. These are often called Customer Relationship Management or CRM software packages, although there are more about monitoring and measuring sales success than the traditional perspective on CRM which considers long-term communication. However CRM software and a trained salesforce will have the opportunity to communicate with and develop relationships with prospects. Examples include IBM’s content management software and others such as Salesboard.

Exercise – Internet Marketing and Promotion: Internet Advertising

Internet Marketing and Promotion: Internet Advertising

Exercise – Manor Grange Hotel

It’s fantasic for hiking and short walks in a natural rural setting. The hotel stands in 40 acres of rural Scottish countryside – with lochs and small copses, which are typical of the area and provide a habitat for salmon and water birds.

Manor Grange Hotel is a 40 bed hotel, 4 Star hotel located in the in the Scottish Highlands near to Inverness. It is an historic building, which was once owned by Sir Frazer John – a retired Naval officer – with a passion for wildlife, especially fish and wild birds.

Hikers

Exercise Task

Manor Grange Hotel needs advice upon how to promote itself using web-based technologies. Advise them on methods of marketing their business on The Internet.

Answer – Promotion

Integrating the Promotions Mix – Answer

‘www.cuttingitshort.com’ – The Campaign

Personal Selling.

It was decided very early on that personal selling did not suit the nature of the business. The other elements of the promotions mix were far better suited to the mass market.

Sales Promotion.

A promotion was organized with a national daily newspaper that share the same target consumer. Coupons were put in seven separate issues. Once collected, the consumer would post them to www.cuttingitshort.com for a free mountain bike spanner (a product that was very slow moving anyway).

Public Relations.

The company invested around $100,000 in a first rate public relations agent.

Direct Mail.

Direct mail was passed up in favour of an e-mail campaign to existing users promoting the recent additions to the site.

Trade Fairs and Exhibitions.

The company invested $50,000 in a special stand that used Internet technology to explain the virtues of buying www.cuttingitshort.com’s products using the Web.

Advertising.

A huge $2,000,000 was spent on an international campaign which used TV, Radio and poster media.

Sponsorship

A decision was made to invest $1,000,000 on sponsoring a round-the-world yacht race.

As with all case studies, there could be many realistic answers. How did you get on.

Answer – eMarketing Product

eMarketing Product

The answers are below. How did you get on?

B – Online Alternative

The Online Alternative is a new start-up that uses the Internet as an original channel of distribution to get products, brands, services or solutions, currently available elsewhere, to market. Some segments may be better targeted with this online alternative, for example remote or fragmented markets.

eMarketing Product

C and D – Online Innovators

Online Innovators come in two forms:

  • C – Online Innovators are existing businesses that see a benefit to launching new and innovative products, brands, services or solutions online by leveraging new technology. Existing businesses have a wealth of knowledge and learning that underpin their moves onto the Web. Remember, the Internet is not a business paradigm shift (at least not yet) and so current business approaches are often adapted for the Internet. Existing businesses have experience.
  • D – Online Innovators are start-ups that seize the opportunity to launch new and innovative products, brands, services or solutions online. Despite not having as much knowledge and learning as some of their competitors, they are flexible and can move much more quickly. Start-ups often lack experience.

Company One is a successful commercial bank with a very well-known and popular brand. It has decided to launch a new online brand which uses online technology as a channel to market its current portfolio of services – employing a new and energetic branding theme pitched at youth segments. Answer: Innovator (Existing Business).

Company Two is also a commercial bank. However its strategy is to use the Internet as a way of communicating with, and accessing its traditional segments with its existing portfolio of brands. Answer: Online Extender.

Company Three is a new business that has gained a large amount of venture capital for its innovative business idea. It is employing Web 2.0 technology to build a community of practice for African farmers that currently work in remote regions, but may soon have access to the Internet in many local towns. Answer: Online Innovator (Online Start-Up).

Company Four is also a new business. Its owners have seen an opportunity to get jewellery to consumers by building a website which employs e-commerce technologies. Essentially the site owners intend to advertise using Google Adwords based upon keywords such as ‘wedding ring’ and ‘bling.’ Hopefully the pay-per-click adverts will move traffic to their site where sales will be made. Answer: Online Alternative

A – Online Extender

An Online Extender is an existing business that has a strategy whereby it extends its marketing activities to the Internet. It could be any traditional, terrestrial organisation that has historically grown through using traditional channels of distribution to get existing products, brands, services or solutions to market.

Starbucks Marketing Mix

Current CEO Howard Schultz joined the company in 1982 and began pressing to have Starbucks provide coffee, espresso drinks as well as sell coffee beans in its stores. Schultz left to start his own store called Il Giornale. This operation experienced success with Schultz suggested offerings. Eventually Starbucks was sold to Il Giornale which then rebranded itself as Starbucks. By the time the firm went public in 1987 it had expended to more than 160 outlets.

Today Starbucks is in more than 55 countries and boasts annual revenues in excess of $7 million dollars for its U.S. operations, as well as 1.9 million from its international operations.

Product

  • Starbucks specializes in coffee and related beverages. The company sells coffee, Italian-style espresso beverages, cold blended beverages, as well as a selection of premium teas. In addition, the firm also sells coffee-related accessories and equipment.
  • Tazo Tea is the Starbucks brand. There’s many, many different flavors and you can get them as iced teas, lemonades, lattes, hot or cold.
  • Some of their most popular teas fall into the Chai tea category. It’s a spicy black tea with cardamom, cinnamon, black pepper and star anise.
  • An espresso is a strong, black coffee that is brewed by forcing hot water through coffee grounds. It’s more concentrated, has more caffeine than regular
  • A Starbucks Latte is Espresso with steamed milk and foam.
  • A Caramel Macchiatto is a vanilla latte with less vanilla, extra foam and a caramel sauce on top.
  • A Starbucks Cappuccino is similar to a latte but with more foam.
  • Starbucks Mocha is an espresso, steamed milk and chocolate with whipped cream on top.
  • A Starbucks Coffee Frappuccino is Starbucks coffee, milk and blended with ice.
  • An example of Starbucks blended creams is the pumpkin spice frappuccino which includes pumpkin and traditional fall spices, mixed with milk and blended with ice, then topped with whipped cream and pumpkin spices.

Starbucks Marketing Mix

Introduction

Jerry Baldwin, Zeff Siegl, and Gordon Bowker formed Starbucks in Seattle, Washington in 1971. Its origin is said to be inspired by another coffee lover and store Owner; Alfred Peet. Starbucks actually began by purchasing coffee from Peets, but eventually began buying directly from growers. Would you like to take a lesson on the marketing mix?

Price

  • On September 22, 2010 Starbucks announced that it would be raising prices due to the increasing price of coffee beans, dairy and other raw material.
  • Starbucks expects to maintain or lower the price of some of its most popular beverages, including certain espresso beverages; and, in most markets, its popular $1.50 tall brewed coffee; and to raise prices of labor-intensive and larger-sized beverages
  • Unlike the coffee, tea prices aren’t based on the size, instead it’s based on the number of tea bags, since water is pretty cheap in non-bottle form.

Place

  • The Coffee Holding Company, Inc. is located at 3475 Victory Blvd, Staten Island, in Staten Island, New York.
  • Starbucks Coffee Canada is located in Toronto, Ontario
  • Starbucks Capital Asset Leasing Company is located in Delaware.
  • Starbucks has branches in Argentina, Australia, Chile, Singapore, Japan and the UK.
  • Starbucks coffees and teas were available in approximately 39,000 grocery and warehouse club stores, 33,000 of which were in the US and 5,500 in international markets.
  • The CPG segment includes packaged coffee and tea as well as branded products sold worldwide through channels such as, warehouse clubs, convenience stores and grocery stores.

Promotion

  • Starbucks started a community website, My Starbucks Idea, designed to collect suggestions and feedback from customers.
  • My Starbucks reward program allows members to earn a free drink after every 15 purchases at participating Starbucks stores.
  • It’s rare (if not none) for you to find a Starbucks ad in a billboard, ad space, newspaper or poster in places where you can expect to see advertisements for most other establishments, such as McDonalds?
  • Starbucks stresses quality above price and other features it could emphasize.
  • The company has went to great lengths to create a “community atmosphere” among premium coffee lovers.
  • In 2001 Starbucks introduced the Starbucks Card, a stored-value card for customers to use and reload.

Process

  • Starbucks operates primarily through joint ventures and licensing arrangements with consumer products business partners.
  • The Starbuck Company’s International specialty operations are comprised of retail store licensing operations in more than 40 countries and foodservice accounts in Canada and the UK.
  • The company’s US specialty operations include licensed retail stores, food service accounts and other projects related to Starbucks’s main business strategy.
  • Starbucks accepts store license applications online, with the initial information centering on the type of operation being run by the applicant.
  • Starbucks started a community website, My Starbucks Idea, designed to collect suggestions and feedback from customers.

Physical Evidence

  • Starbucks provides information on its products, business partnerships, and career opportunities on its website .
  • The famous Starbucks Logo (which is green and features a partially nude siren) has stayed largely unchanged since its origin, However it has been altered to adjust to international sensibilities.
  • Starbucks stopped using pre-ground beans in its stores in order that the grinding of whole bean coffee will "bring aroma, romance and theater" to American stores.

People

  • Howard Schultz is Chairman, Chief Executive Officer for Starbucks.
  • Olden Lee Interim Vice President
  • Barbara Bass Director, Non Executive Board
  • Cliff Burrows is President of Starbucks Coffee US
  • Author Rubenfeld, Global Development
  • Troy Alstead is Chief Financial Officer
  • John Culver is President of Global Consumer Products

Sony Marketing Mix

Four years later the company developed and produced Japans’ first magnetite-coated, paper-based recording tape, called Soni-Tape. In 1955, the firm began using Sony logo on Totsuko products. The group also launched Japan’s first transistor radio, the TR-55, during the same time. In 1958, the group changed its name to Sony.

Today Sony has developed ‘TransferJet’, a proximity wireless transfer technology enabling the high speed transfer of large data files between electronic devices such as mobile phones, digital cameras, YVs, digital video cameras, computers and the company recorded revenues of JPY7,730 billion ($77.3 billion) during the financial year ended March 2009.

Product

  • Audio – Home, portable and car as well as personal navigation systems
  • Video – Video cameras, digital cameras, DVD/Video players & recorders
  • Televisions – LCD televisions, Projection televisions CRT-based televisions
  • Information and computers – personal computers, printers
  • Semiconductors- LCD, CCD, and other types of semiconductors
  • Games – PlayStation
  • Television and motion pictures
  • The company offers a Sony Card and a PlayStation card, these are rewards cards credit cards which allows customers to earn redeemable points when they purchase Sony products and services

Price

  • HVRA1U C-MOS 1080i HDV Camcorder – Broadcast & Promotion- U.S. List price -$2,750.00.
  • XCL5005 5 Mega Pixel PoCL B/W Digital Video Camera- Industrial & Professional U.S. List price – $4,377.00.
  • Total Performance Projector VPLDX10-2500 Lm 3LCD XGA Mobile Projector-U.S. List Price – $1,410.00.
  • Medical Equipment Monitors & Displays GXDL52H1 52inch Full Hd Ruggedized LCD-U.S. Listed Price – $5,700.00.
  • Security Systems – SNCCH140 Network 720p HD Fixed Camera with View-DR Technology U.S. List price – $1,298.00.
  • Video Conference Devices PCSG70S – 4 Mbps High-End Video Communication System (Codec Only) U.S. List price $8,200.00

Sony Marketing Mix

Introduction

Sony was founded in 1945 by partners Masaru Ibuka, (an engineer), and Akio Morita, (a physicist),and was originally named Tokyo Tsushin Kogyo (Tokyo Telecommunications Engineering). The firm was launched in Nihonbashi, Tokyo. Would you like to take a lesson on the marketing mix?

Place

  • Sony has an online presence in several formats, for example http://pro.sony.com/bbsc/home.do provides information on products and their prices. The site also has information on corporate applications for its offerings.
  • Sony Product distributors that sell selling to VARs + System Integrators include: ASI Corp, Avnet Inc. and Bell Microproducts, Microland Electronics Corp.
  • Wholesale distributors of Sony Products include but are not limited to : Best wholesale co. Ltd, Dongsheng International Trade Co. Ltd, Denzuke Network Sdn. Bhd., Front-Page Trade Co., Ltd.

Promotion

  • The company offers a Sony Card and a PlayStation Card, these are rewards cards credit cards which allows customers to earn redeemable points when they purchase Sony products and services.
  • Sony implements a discount coupon program offering 25% to 50% discounts on products such as PC speakers, Blue-Ray Disc Players, notebooks and laptops.
  • Sony’s Rebate Zone website provides rebates such as the following $500.00 rebate (by mai)l following the purchase of a Sony HVR-V1U HDV Camcorder or a Sony HVR-DR60 Hard Disk Recorder/Player or a $300.00 rebate by mail following the purchase of a Sony HVR-A1U HDV Camcorder.

Process

  • Sony employs an umbrella branding strategy by placing the product name along with corporate name. This strategy lets the product to assume its own identity and positioning, but also draws strength of the corporate brand. The goal is to bolster consumer confidence in the product. Sony has used this strategy to launch new products.
  • The company’s focus on its research and development (R&D) activities is evident in its expenditure of over $5 billion in 2009. The strong focus on R&D helped the company to launch technologically innovative products in the market. The strong focus on R&D would thus enable the group to revive its product base as needs are indicated by customers. Examples of this strategy include the introduction of BRAVIA, ZX1, a thin, lightest LCD TV featuring LED edge lighting; The VAIO P Series notebook computer (the world’s lightest 8-inch notebook PC) and the Cyber-shot HX1 compact digital camera (which allows users to capture wide-angle of 224 degrees views).
  • Sony operates from a philosophy it labels “uniquely Sony”. The company seeks to facilitate the development of its staff but spurs employees to manage their own career and but to avoid pigeon-holing. This is a microcosm of the company’s desire to foster adaptability. The company’s broad outlook extends to its corporate responsibility.
  • The desire to make its hardware and interfaces that are easy to use was a catalyst behind recent reorganization of electronics into “Personal” and “Home categories. The company has reaffirmed its commitment to make the “Home” category more user-friendly.
  • Sony has adopted a “Company of Committees” governance system in order to go beyond minimum compliance with legal requirements and to add additional transparency. To accomplish this, the company has revised some Directors’ functions to facilitate the proper functions of statutory committees.
  • Sony has a recently reorganized in order to further improve responsiveness and customer service. It has established a network of services tailored to the needs of local customers. The move acknowledges the growing complexity of its products. The company formed Sony Customer Services, Inc and has intiated special employee training to enhance its ability to respond to customers inquiries and requests.
  • Sony seeks to instill corporate social responsibility policies throughout its supply chain. For example Sony established the Green Partner Environmental Quality Approval Program for Sony suppliers. Sony maintains a common global quality standard for parts by purchasing electronic parts only from suppliers who have passed an audit and have been certified as Green Partners.

Physical Evidence

  • Sony Corporation Headquarters is located at 1-7-1 Konan, Minato-ku Tokyo
  • Other locations of subsidiaries include Sony Corp of America at 550 Madison Avenue in New York, Sony Electronics of Latin America 5201 Blue Lagoon Dr Suite 300, Miami Florida, and Sony Electronics 12451 Gateway Dr, Fort Myers
    Florida
  • In 1994 Sony opened its Wonder Technology Lab which is a free interactive technology and entertainment museum located at 56th street and Madison Avenue in New York City. The Museum is open to all ages.
  • Sony Plaza at 56th Street and Madison Avenue in New York City. The company compliments the facility with a website at http://wondertechlab.sony.com/index.html
  • Sony’s main company website provides helpful information ranging from service and support, music, electronics and gaming as well as a range of shopping alternatives.

People

  • Howard Stringer is Chairman, CEO and President of Sony
  • Hiroshi Yoshio is Executive Deputy President of Consumer Products & Devices Group (NPSG).
  • Kazuo Hirai is Executive Vice President of Networked Products & Services Group
  • Sony employs 167,900 people world wide
  • Sony has an ongoing talent development initiative . In 2008, the company created 13 global talent directors who are assigned to identify promising individuals in all businesses and regions and develop them into future business leaders. This initiative also includes a job rotation project with individuals moving through a schedule of job assignments designed to give them exposure to a variety of businesses and regions.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Ryanair Marketing Mix

Its charismatic boss Michael O’Leary has a business model with a central focus on cost reduction (and making money of course!). In around 20 years he has taken Ryanair from a single plane company to become the largest airline in Europe. He had a vision and achieved it through masterful leadership. So how did he do it? How does Michael O’Leary retain his narrow cost focus niche strategy in the face of intense competition? The business simply has lower costs and those costs are passed on to their passengers in the form of low fares.

The branded airlines argue that passengers are willing to pay more for a better level of service. You can pre-assign seats. You get food and drink onboard, and can choose a higher level of service e.g. business class. However the large flag carriers have taken notice of the low-cost model and have employed it as part of their own more differentiated business model.

In 2009 the company settled for 30% of its local Irish rival Aer Lingus after a prolonged takeover bid. Tough trading conditions meant that Ryanair made its first annual loss in 2008/9. O’Leary put this down firmly to rising fuel costs (as did British Airways in the same year). The company also needed to take into account the burden of purchasing its stake in Air Lingus. So in reality things are looking good for Ryanair and its budget operation – since the business aimed to fly double the amount of passengers 2009/10.

Let’s take a closer look at Ryanair’s marketing mix:

Product or Service.

  • Low cost, no frills air travel to European destinations.
  • There is no free food or drink onboard. Food and drink are income streams. You buy them onboard, or you don’t – take your own food and drink if you like.
  • There are other income streams – or ancillary revenue. The company has deals with Hertz car rental, and a number of hotel businesses. So Ryanair takes a commission on ‘up selling’ i.e. ancillary revenue. Other examples include phone cards and bus tickets. About 16% of profit is made this way. This keeps costs lower.

Ryanair Marketing Mix

Ryanair is the European low cost airline. Low cost or no frills marketing strategies are of great interest to marketers since the marketing mix employed tends to run in opposition to what makes a great brand – and Ryanair is a great brand and a very successful business. In a nutshell Ryanair sells the cheapest tickets that you can buy (on most occasions). If you’d like to learn more about this topic then take a look at our marketing mix lesson. Otherwise please read on. Would you like to take a lesson on the marketing mix?

Price

  • Ryanair has low fares.
  • 70% of seats are sold at the lowest two fares.30% of seats are charged at higher fares. The last 6% are sold at the highest fare
  • Ryanair occasionally get in trouble with bodies such as the Advertising Standards Authority (ASA) in the UK over differences between advertised and actual price – in fairness to Ryanair these are rare mistakes.

Place

  • Ryanair does not use travel agents so it does not pay agency commissions. It uses direct marketing techniques to recruit and retain customers, and to extend products and services to them (i.e. Customer Relationship Management). This reduces costs.
  • You book online over the Internet. This saves them 15% on agency fees.
  • They are based in Stansted in Essex – which is known as a secondary airport. It is new and accessible. It is cheaper to fly from Stansted than either Heathrow or Gatwick, and since it is less busy Ryanair can turn aircraft around more quickly.
  • Many of Ryanair’s destination airports are secondary. For example if you fly to Copenhagen (Denmark) you arrive in Malmo (Sweden) – although it is only a short coach trip over the border. Secondary airports, which tend to be smaller regional airports, depend upon this single carrier – some (it is rumored) paying up to £100, 000 for each additional new route. Costs are lower and aircraft can be turned around faster.
  • Keeping aircraft in the air as much as possible is another important part of the low cost jigsaw. However, the company has been challenged by the European Union in relation to anti-competition laws.

Promotion

  • They spend as little as possible on advertising.
  • They do not employ an advertising agency. Instead all of the advertising is done in-house. In fact O’Leary himself oversees much of the promotion of Ryanair. They use simple adverts that tell passengers that Ryanair has low fares.
  • Ryanair employs controversy to promote its business. For example in 2009, the company reasoned that passengers would be charged £1 to use the toilets on board. O’Leary reasoned that passengers could use the terminals at either the destination or arrival airport. This would speed things up. It was reasoned that this is what passengers wanted – since they did not want other passengers leaving their seats and walking the aisles to go to the toilet. O’Leary also argued that larger passengers should be charged more since they took up more room – again it was reasoned that this is what the majority of passengers wanted.
  • Some of their aircraft are decorated in the livery of advertisers e.g. News of the World, Jaguar and Kilkenny (beer).

People

  • Pilots are recruited when they are young as pilot cadets. They work hard and take early promotions and then move on after 10-years or so to further their careers.
  • Cabin crew pay for their uniforms to be cleaned. They invest in their own training. They are mainly responsible for passenger safety as well as ancillary revenues onboard.

Physical Evidence

  • They pay as little as possible for their aircraft. Planes are the most expensive asset that an airline can make. They get big discounts on aircraft because they buy them when other airlines don’t want them, for example after September 11th, or on the invasion of Iraq and Afghanistan. Aircraft manufacturers cannot simply stop a supply chain in minutes. If orders are being cancelled or delayed, this is when to buy. It was rumored within the industry that Ryanair was buying Boeing 737s – list price around £40,000,000 (forty million pounds) – with up to a 50% discount.

Process

  • There is no check in. You simply show your passport and supply your reference number.
  • You cannot select a preferred seat. It is first come, first served. This aids speed.
  • There are no air bridges (the tunnel that connects to the side of the aircraft when to board it). You walk or are bused to the aircraft.
  • Baggage is deposited directly onto the terminal – it’s quick. However if your bag is broken don’t expect high levels of customer service.

Beyond any doubt, Ryanair is one of the strategic marketing successes of the last decade. Undoubtedly synergized by Michael O’Leary – the low cost strategy that it employs is remarkable and industry changing. In many ways the business has looked closely at all aspects of it markets and operations to remold the industry and customer expectations in a unique way. This is how Ryanair has applied the marketing mix.

Ryanair is the World’s favourite airline with 44 bases and 1100+ low fare routes across 26 countries, connecting 157 destinations. Ryanair operates a fleet of 250 new Boeing 737-800 aircraft with firm orders for a further 64 new aircraft (before taking account of planned disposals), which will be delivered over the next 2 years. Ryanair currently has a team of more than 8,000 people and expects to carry approximately 73.5 million passengers in the current fiscal year. More . . .

Bibliography

Ryanair’s route to riches, BBC The Money Programme, First transmitted 4th June 2003.
Ryanair reports first annual loss – BBC New Online – 2nd June 2009.
Aer Lingus to vote on board pay – BBC News Online – 5th June 2009.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Pepsi Marketing Mix

In November 2007, PepsiCo announced a restructuring initiative to split the company into three units, one for food in the US, one for beverages in the US and one for food and drinks abroad.

Product

  • Beverage ProductsDiet Pepsi, Gatorade, Mountain Dew, Thirst Quencher, Tropicana, Aquafina Bottled Water, Sierra Mist.
  • Savory Food Snacks – Fritos Corn chips, Cheetos, Ruffles Potato Chips, Lays Potato Chips, Tostitos, Doritos.
  • Other Food Products – breakfast cereals, cakes and cake mixes.
  • PepsiCo recently created Baked Snacks North America Business Unit to meet consumer’s interest in more nutritious snacks and foods.

Price

  • Expenses related to transportation, ingredients and labor continue to pressure the beverage industry toward price increases.
  • PepsiCo’s drink pricing strategies may be heavily influenced by its working relationship with Wal-Mart whose low price themes put pressure on PepsiCo to hold down prices.
  • The company strives to cut or maintain current prices by cutting overhead and re-engineering the manufacturing process.
  • PepsiCo is expanding its use of inexpensive and recyclable plastic bottles; nevertheless the company has instituted some price increases in recent years, specifically in its overseas markets such as New Delhi and Duba.

Place

  • PepsiCo is primarily a US based company with approximately 52% of its revenues located in the states.
  • PepsiCo is in the midst of making a $1, 000 million investment in China, and a $500 million investment in India. Both initiatives are part of its expansion into international markets and a lessening of its dependence on US sales.
  • In addition the company plans on major capital initiatives in Brazil and Mexico.
  • The company is also acquiring Russia’s leading Juice Company, Lebedyansky, and V Water located in the United Kingdom.

PespsiCo Marketing Mix

In 1965 Herman W. Lay of the Frito-Lay Company and Donald Kendall of Pepsi-Cola formed PepsiCo. In 1986 operations were combined under PepsiCo Worldwide Foods and PepsiCo Worldwide Beverages. In 2001 PepsiCo merged with Quaker Oats to form a $25 billion company. PepsiCo restructured in 2007 dividing the company into three units’ food in the US, Drinks concentrated in the US and Food and Drinks marketed abroad. Would you like to take a lesson on the marketing mix?

Promotion

  • PepsiCo instituted a so called Pepsi Stuff promotion whereby customers could accumulate Pepsi Points from buying various products these points could be used to by other products, most recently AmazonMP3.
  • A recent promotion involving the NY Yankees was not well received when not enough free tickets were made available.
  • In 2008 PepsiCo employed Tiger Woods to promote a Gatorade brand called Gatorade Tiger.
  • PepsiCo continues is promotional association with the NFL and the Super Bowl specifically marketing Pepsi and Doritos.
  • In 2009 Pepsi launched its “Pepsi Throwback” campaigned offering a drink with the sugar content of its original product.

People

  • Indra K. Nooyi is the President of PepsiCo in addition to the company’s CFO
  • Recently the Board of Directors elected Steven S Reinemund chairman of the board and chief executive officer.
  • PepsiCo fosters a corporate culture that values employees and emphasized diversity in the workplace.
  • PepsiCo is named to the ‘Best Companies for Multi Cultural Women’ list by Working Mother magazine
  • PepsiCo is recognized at two events for its dedication to Talent Sustainability and dedication to Asian American employees—2009 Best Companies for Asian Pacific Americans from Asian Entrepreneur, Top 10 Companies for Asian Americans from AMBA
  • PepsiCo has won  the ‘Workplace Excellence’ Award at Out & Equal Workplace National Summit
  • PepsiCo is listed in the top 20 ‘Ideal Employer MBA Ranking’ in Fortune magazine

Pysicial Evidence

  • PepsiCo’s website provides a wealth of information about the company including the firm’s rich history and manufacturing process.
  • PepsiCo is an industry leader in packaging – helping to promote and implement standards for sustainable packaging.  
  • PepsiCo has a packaging philosophy: reduce, reuse, recycle, remove and renew.

Process

  • PepsiCo is in the process of removing high fructose corn syrup (HFCS) from both the traditional.
  • The Frito-Lay department will soon produce  Lay’s Kettle with natural flavors, and to boost the whole grain and fiber content, respectively, of its Tostitos and Sun Chips brands.
  • Flavor concentrates are shipped from special Pepsi-Cola manufacturing plants, The bottles and cans that will eventually be filled with Pepsi are manufactured elsewhere, and shipped to Pepsi plants wrapped and sealed for protection, Labels, cartons, caps, the carbon dioxide used to carbonate soft drinks and other supplies are also produced for Pepsi by other companies, Once on the belt, cans are part of an enclosed, controlled environment that keeps them sanitary and helps ensure quality throughout the filling process, Pepsi-Cola takes special care to purify the water it uses – a procedure that involves careful treatment, filtration and purification, Pepsi-Cola flavor concentrate is carefully combined with sweeteners and other ingredients in large stainless steel mixing tanks. Quality control audits performed by specially trained technicians are a critical part of the manufacturing sequence, In the last step of the manufacturing process, as the now-rinsed cans reach the filler, they’re reinverted, immediately filled and the lid is applied – at an average speed of 1,200 cans per minute.

Kroger Marketing Mix

In 1904 the company proved a leader in the industry again by establishing it as one of the first companies to sell groceries and meat under one roof. By 1929, Kroger was operating 5,575 stores. The company opened its first superstore in Barberton, Ohio, in 1972.

In 2008 Kroger partnered with The Little Clinic to opened walk-in medical clinics and consumer health solutions inside.

Product

  • Kroger operates 15 dairies and three ice cream plants.
  • The company operates three meat plants.
  • Kroger grocery Items include but is not limited to: meat, poultry, cereal, vegetables,  soft drinks,  wine, beer, canned goods, snacks and packaged foods
  • In addition to food, Kroger store items include: automotive products, flowers, office and school supplies, kitchen gadgets and apparel, as well as home electronics, yard furniture and a pharmacy.
  • Kroger private label brands include: Private Selections, Naturally preferred, Active Lifestyle, Kroger Brands and Kroger Value.

Price

  • In 2009 Kroger invested an additional $28 million to reduce prices in its meat, produce, and beauty and health departments to save shoppers money on hundreds of popular items and help them weather the economic slump.
  • Kroger’s increased emphasis on developing cheaper private label products and prepared foods is compatible with consumers desire to eat more meals at home, and forgo higher priced items.
  • The company’s success with private brands puts it in a strong bargaining position with suppliers seeking cost increases.
  • Kroger utilizes data from its loyalty card program link our customers to savings on groceries, fuel, pharmacy needs, general merchandise and corporate brands and tailor unique coupon offers.
  • Increased sales at its Kroger sushi bars, hot soup, sandwich counters and refrigerated soups and entrees also reflect a shift in consumer behavior towards the price savings of prepared foods over eating out of the home.

Kroger Case Study

Introduction

Kroger Store originated in 1883, established by Barney Kroger of Cincinnati, Ohio.
In 1901, Kroger broke new ground that same year by becoming the first store to have its own bakery. The company was incorporated in 1902 as The Kroger Grocery and Baking Company. Would you like to take a lesson on the marketing mix?

Place

  • Kroger is headquartered in Cincinnati, Ohio
  • The company has subsidiaries located in Colorado, Kansas, Texas, Roanoke, Louisville, Tennessee, Atlanta, Indianapolis, Salt lake City, Arizona, Denver, Compton, Belleview and Westerville.
  • Kroger distribution centers are located in Delaware, Ohio, Memphis Tennessee, West Liberty, Ohio, and Simpsonville South Carolina.
  • Kroger’s Fred Meyer distribution centers are found in Clackamas, Oregon, Puyallup Washington, and Chehalis, Washington.
  • Kroger ha four Ralph’s distribution centers in California: Compton, Los Angeles, Riverside, and Paramount.
  • Kroger also has Peyton distribution centers they are found in Bluffton, Indiana, Cleveland, Tennessee, and Portland, Tennessee.
  • Kroger offers prescription refills, flowers, gifts, gift cards, digital photo developing and hard-to-find products on their websites.

Promotion

  • Kroger’s “Digital Choice Rewards” lets customers obtain free music, movies and ringtones when they use their shopper’s card to by 10 participating items.
  • The company is offering special savings on items in association with the 50th Daytona 500.
  • In 2009 Kroger ran a “Free Gas and Groceries” gift card contest promotion
  • Kroger offers weekly ads savings updates, via email.
  • Kroger is running a “March to Savings” yellow tag promotion in participating stores.
  • Kroger’s “Right Store, Right Price” slogan is consistant with its Customer 1rst Strategy.

People

  • David Dillion is the Kroger company chairman and chief executive officer.
  • W. Rodney McMullen is Kroger’s chief operating Officer.
  • Kroger employs more than 334,000 associates who serve customers in 2,468 supermarkets and multi-department stores in 31 states
  • Kroger has executed labor agreements that include cost-reducing measures such as relaxed work rules, wage progression extensions and continue to pursue fair and balanced contract settlements.  

Pysicial Evidence

  • Kroger operates 40 manufacturing plants, primarily bakeries and dairies. In addition to the supermarkets, it operated through subsidiaries, 777 convenience stores and 374 fine jewelry stores.
  • Its fine jewelry stores located in malls are operated in leased locations.
  • In addition, Kroger also oversees 87 convenience stores were operated through franchise agreements.
  • Kroger’s company website provides information on healthy living tips, recipes, and special savings promotions.  

Process

  • Kroger operates its own fleet of trucks and trailers to distribute products to its various stores, in addition to a contract with the trucking company, First Fleet.
  • Food distribution and buying takes place under various subsidiaries and divisions. These include: Inter-American Products – private label goods and Wesco Foods – produce buying.
  • Kroger has a 3-tiered distribution system. The 2nd and 3rd tiers, internally known as "Peyton’s", service retail stores and provide promotional and seasonal products. Kroger operates five "Peyton’s.
  • Kroger store has core values that guide its decision-making include: honesty, integrity, respect, diversity, safety, inclusion and involvement.
  • Kroger’s overriding plan is found in its “Customer 1st strategy”.

Nintendo Marketing Mix

Price

The pricing of games is quite interesting. Nintendo will use a series of pricing strategies throughout the life of the product. Prior to launch the business will take orders for new games and consoles, which will all be premium priced and the business will apply a price skimming strategy. As the product becomes adopted they will begin to reduce price to competitive parity, and as they reach the end of their life-cycle games will be priced promotionally until they hit the bargain bucket. Who knows whether in the future they will become nostalgia products or even antique rarities?

Place

The product is distributed in a number of ways. Nintendo manufactures products and then distribute it via wholesalers to retailers to you. Some very large national accounts will be dealt with directly because of the huge volumes they buy. Nintendo is available on the high Street in all key electrical and gaming retailers, as well as being sold online by well-known retailers such as Amazon.com and play.com, and you might find one or two second-hand bargains on eBay.com. Distribution is mature for Nintendo and there are few avenues to market which they do not pursue.

Promotion

Nintendo will launch new products. For example, when the company launched the Nintendo 3DS there were a series of special launch days, and even some midnight launch events. Fans of the Nintendo product get the chance to have a go on the new Nintendo system, early purchasers get a free carrying case, and there are always free giveaways such as T-shirts and beanies.

The launch campaign demonstrates a huge effort on the part of Nintendo. For example, more than 85% of the UK audience saw the Nintendo 3DS campaign called Believe Your Eyes. The campaign itself was to emphasise the benefits of the 3D experience. The campaign was a mash up of consumers experiencing the product and innovative advertising.

Nintendo Marketing Mix

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Product

Nintendo operates in the manufacturing and distribution of innovative, interactive entertainment products. For example the business markets home entertainment, handheld devices and also provide the hardware and software which is necessary for the use of electrical products.

Popular amongst its product lines over the years have been GameCube, GameBoy, Wii, Nintendo 64, Super NES, Nintendo DS, Super Mario, Pokémon, Brain Age and many other well-known gaming brands.

In 2012 it is rumoured that Nintendo will partner Fuji television and Nippon television to bring full 3-D television shows to its Nintendo 3DS. The content is free, although consumers will need to watch adverts.

The launch of the Wii U controller will make it much more interactive. It has a central, handheld touch screen and will show different media to supplement and enhance the experience on your TV. It has a High Definition (HD) platform. Reports indicated that it will be launched somewhere between June 2012 and September 2012, although the price to you the consumer is yet to be announced.

This is nothing new. Back in 2000 Nintendo spent in excess of $200 million to launch their new Nintendo Wii product. Much of this brand was actually targeted at non-gamers, so not only trying to tempt gamers from competitors products, but also attacking new targets players such as older people and women. People playing Nintendo Wii on TV ads are not your typical perfect people!

People

Being a manufacturer, Nintendo don’t really have public facing employees, certainly not facing the public in the retail environment. This is done by their distributors. However in 2010 Nintendo rewarded employees with an £11,000 bonus per employee which is very generous for Japanese workers, comparing with a meagre £8000 for Honda workers. According to Euro gamer.net the average salary for a Nintendo worker aged 35 to 39 years old was about £38,000 per annum including bonuses.

Process

Most processes revolve around the design, development, manufacturing, marketing and post-purchase services for each Nintendo product. There will be processes for ordering new products before launch, and for returning faulty products should they occur. There will also be the customer life-cycle which hopefully will see Nintendo customers remaining loyal over a long period of time.

Pysicial Evidence

The Nintendo logo and brand is one aspect of its physical evidence. You must be familiar with the trademarked Nintendo term surrounded by a curved oblong, generally in red. Others would include super Mario Bros and Pokémon.

At an initial glance their buildings are pretty much square boxes, and do not replicate the campuses of Microsoft and Google in terms of their physical presence. The closest that they have come to some physical evidence is their Kyoto-based research and development headquarters, which was built in 2009.

Johnson and Johnson Marketing Mix

Over the years Johnson & Johnson has grown substantially in part due to strategic acquisitions ranging from large ones such as Neutrogena in 1994 and DePuy in 1998, to many smaller ones. From 1989 to 1999, the company made 45 such acquisitions of companies and product lines. Today the firm can boast of revenues exceeding $61,897 million during the financial year (FY) ended December 2009.

Product

  • Johnson and Johnson products are basically in three main categories: Pharmaceuticals, Medical Devices & Diagnostics, and Consumer Health care.
  • The following are examples of the Johnson & Johnson product inventory: Feminine hygiene, Denture care, Contraceptives, Immunology, First aid, Family planning, Oncology, Nutritionals, Diabetes care, Neurology, Vision care, Allergy cold and flu treatment, Women’s Health, Medical devices and diagnostics.
  • Price

  • In the United States, Johnson and Johnson strives to keep their net price increases for health care products within the Consumer Price Index (CPI).
  • Johnson and Johnson works with governments to develop differential pricing approaches to help more people access their medical products. Johnson & Johnson companies have agreements with the United Kingdom for VELCADE ® (bortezomib), a treatment for multiple myeloma, and with France for RISPERDAL® CONSTA® (risperidone long-acting injection) a medication for the symptoms of schizophrenia. Companies and government agencies are also entering other types of risk-sharing agreements in order to help people gain access to new therapies sooner.
  • The following are examples of Johnson and Johnson consumer product prices: Bengay Pain Relief $12.99, (at Amazon), Listerine Oral Care $7.49 (Next Tag), Splenda Sweetener $7 (Drusstore.com).Tylenol Rapid Release $12.95 ( Allegro Medical.com ).
  • Place

  • These are some companies that sell Johnson and Johnson products wholesale: Over the Counter Wholesale.com, WUZ Group, ShopatHome.com
  • Johnson and Johnson products can be found at the following retail outlets: Target, Walgreens, WalMart, Vons and Eversave, to name but a few.
  • Johnson and Johnson Marketing Mix

    The roots for the Johnson & Johnson Company run deep. The company began in1886. It incorporated one year later. By 1896 it had released its first major product of note – a sterilizing technique for catgut sutures.

    The firm branched out in 1919, with the establishment of an affiliate in Canada, and in Britain in 1924. Next came a public launch and a listing on the New York Stock Exchange in 1944. Would you like to take a lesson on the marketing mix?

    Promotion

  • Johnson and Johnson offers special discount coupons on products such as baby care, and contact lens.
  • Johnson and Johnson has run a “Beauty for All Ages” rebate promotion on Coupons.com and some of the campaign products are available at Walgreens and may also include buy one get one half off discount as well.
  • Johnson & Johnson is involved with many causes and advertising campaigns that encourage healthy lifestyles. Key initiatives include: The Campaign for Nursing’s Future, Having a Baby Changes Things, and Because We Care We Act (China).
  • Process

  • Johnson and Johnson employs what they call a “decentralized management approach”. Employees are encouraged to be “entrepreneurial” with the understanding that they will benefit from focusing on customer needs and providing solutions.
  • Johnson and Johnson seeks to turn insights into innovative new products and sometimes whole new businesses. Their goal is to capitalize on scientific breakthroughs, marketing insights and manufacturing expertise easily across the full range their businesses. With more than 250 operating companies have a local window into emerging customer needs, scientific developments, and technologies throughout the world.
  • The Executive Committee of Johnson & Johnson is the principal management group responsible for the operations and allocation of the resources of the Company. This Committee oversees and coordinates the activities of the Consumer, Pharmaceuticals and Medical Devices and Diagnostics business segments. Each subsidiary within the business segments is, with some exceptions, managed by citizens of the country where it is located.
  • Physical Evidence

  • The Johnson & Johnson Headquarters is located at One Johnson & Johnson Plaza, New Brunswick, New Jersey.
  • The Johnson& Johnson Consumer Division is located at 199 Grandview Road, Skillman New Jersey.
  • The Ortho-Biotech Division is located at 700 Route 202 Raritan, New Jersey.
  • The Lifescan Division is located at 1000 Gibralta Drive, Milpitas, California.
  • The VistaKon Division is located at 7500 Centurion Pkwy, Jacksonville, Florida.
  • The Endo Surgery Division is located at 4545 Creek Road Cincinnati, Ohio.
  • The Independence Technology Division is located at 40 technology Drive, Warren New Jersey.
  • Company Subsidiaries, Codman and Shurlett as well as De Puy Acromed are located at 325 Paramount Drive Raynham Massachusetts.
  • The Johnson and Johnson logo is based on the signature of James Wood Johnson, one of the two brothers originally who founded the company.
  • Johnson & Johnson maintains a presence online via a number of websites http://www.jnj.com/connect/others/sitemap/ which provide information on company values, and management approach.
  • Another Johnson and Johnson website http://www.jnj.com , provides detailed information on various consumer products such as Listerine or Tylenol.
  • People

  • William C Weldon is Chairman & Chief Executive Officer of Johnson & Johnson.
  • Dominic J. Caruso is the Chief Financial Officer and Vice President of Finance.
  • Johnson and Johnson has a Global Diversity and Inclusion program with a goal of achieving a skilled, high performance workforce that is reflective of the diverse global marketplace (workforce).
  • Johnson & Johnson was ranked #2 among Diversity Inc. Magazines Top 50 Companies for Diversity.
  • The company has ranked high Working Mother Magazines’ Top One Hundred Companies for Working Mothers
    or 24 years.

Johnson & Johnson was founded more than 120 years ago on a revolutionary idea: Doctors and nurses should use sterile sutures, dressings and bandages to treat peoples’ wounds. Since then, we’ve brought the world new ideas and products that have transformed human health and well-being. Every invention, every product, every breakthrough has been powered by generations of employees who are inspired to make a difference. More . . .

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Ikea Marketing Mix

Price

The basis of pricing for IKEA is value i.e. low prices or no-frills pricing. They are not a premium pricer or a skimmer. So products are designed, raw materials sourced, the products are manufactured, they are distributed, and they sold by retail, within this no-frills low-cost framework.

Home delivery is available although this is at an additional cost to the customer.

Place

The IKEA group is an International Marketing business, which sells furniture and accessories in Europe, North America, Asia and Australia.

IKEA’s main business relates to its retail stores. Many of these stores are in out-of-town locations and do not benefit from the footfall of primary and secondary locations. The stores themselves are very large. Many of the stores even have restaurants, food shops and a Swedish market. Some stores even have a bespoke play area.

IKEA has more than 300 stores.

Promotion

IKEA is one of the world’s largest furniture retail brands. The brand itself is based upon the concept of offering home furnishing products at value prices.

The promotions mix includes TV advertising, sponsorship, newspaper and magazine advertising, and many other elements. Some of its TV advertising is considered controversial whilst others see it as pretty plain. Recent campaigns include the IKEA kitchen party advert ‘Be Happy Inside’ campaign and the kitchen party advert.

Obviously their iconic yellow IKEA logo serves to support the brand.

People

The IKEA brand is based upon strong relationships with customers and customer satisfaction. So serving and working with people is central to IKEA’s business philosophy.

In 2011 its then president Mikael Ohlsson made a statement in their annual report outlining his view on the business and its future. In his view the business would be launching many energy-saving alternatives to conventional light bulbs. He commented that their kitchen range would offer many smart, eco-friendly solutions which would include water-saving taps, appliances and a special system that would sort household waste ready for recycling.

Ohlsson made a commitment to reduce the impact of his business on people, as well as the environment. The business would act responsibly, resources would be used efficiently and costs would be reduced. He also wanted sustainability to become more visible to customers and employees.

Ikea Marketing Mix

Product

IKEA has a wide range of furniture for children’s rooms, kitchens, bedrooms and living rooms. Products include coffee tables, side tables, TV solutions, DVD storage, shelves, sideboards, bookcases, sofa beds, armchairs, leather sofas and fabric sofas, as well as many other products. So within these segments IKEA then subdivides again. For example in children’s bedrooms there will be play accessories, beds, changing tables, nursing equipment and so on. IKEA has in excess of 10,000 products. Would you like to take a lesson on the marketing mix?

Services include restaurants and play areas.

Process

The furniture is made by IKEA itself whereby IKEA makes its own wood-based furniture and wooden components. So for example the business owns forestry sawmills.

The customer drives to the store, selects a product, orders, it, and then collect it, only then to have to drive the product home themselves. This is all part of the low pricing commitment.

Pysicial Evidence

Interestingly IKEA was a business that encompassed sustainability quite early in its strategy. Many of its products are recyclable IKEA has invested in very green energy solutions such as solar power.

Physical evidence for IKEA is its very large stores. They are out of town and offer a huge selection of furniture products. Stores tend to be well-equipped with restaurants, very large car parking, the space to move around and modern display technologies.

Home Depot Marketing Mix

Home Depot is a home improvement retailer. The company sells a wide variety of building materials, home improvement, lawn and garden products. The company sells these products to do-it-yourself (DIY) customers, do-it-for-me (DIFM) customers, and professional customers who include professional remodelers, general contractors, repairmen, small business owners and tradesmen. As of 2009, the Company had 322,000 employees.

Product

  • The company sells a wide assortment of building materials, home improvement, lawn and garden products such as patio sets, kitchen, doors, windows, grills, bath, lighting, fans and appliances.
  • Home Depot provides an inventory of products specifically aimed at professional contractors, such as lumber, paint and painting supplies, plumbing equipment, cleaning and janitorial equipment.

Price

  • Home Depot offers discounted prices via its online Savings Center where it cuts up to 20% off products such as play sets, kitchen faucets, and professional saws.
  • The company has established “special buys” prices on appliances offering 25% discounts on products such as Washer & Dryer sets, and 20% off on Water & Ice Refrigerators.

Place

  • The Home Depot’s main office is located in the US, in northwest Atlanta, Georgia.
  • Home Depot has 3 stores in Georgia, 5 in Florida, three in California, as well as locations in Tennessee, New Jersey, and Indiana.
  • The company has stores in Mexico, Guam, the Virgin Islands and Canada.

Home Depot Marketing Mix

Introduction

Home Depot originated in Atlanta Georgia in 1978 when Bernie Marcus and Arthur Blank formed MB Associates. The company went public in 1981.The Home Depot stock moved from NASDAQ to the New York Stock Exchange three years later in 1984. The company then acquired Bowater’s Home Center. The company opened its first super-sized store in 1986. Would you like to take a lesson on the marketing mix?

Promotion

  • In 2008 Home Depot marketed its “New Low Prices” campaign which featured rebates and discounted prices on over 1000 products.
  • The company unveiled its “Aprons on the Floor” initiative designed to improve customer service by providing an increased presence of available.
  • The company markets special offers via email newsletters, do it yourself workshops, and garden clubs.

Process

  • Estimates are that the “Aprons on the Floor” initiative could allow the assignment of two additional hours of floor time per week for these supervisors. This is estimated to mean 4,000 extra hours of customer-service activities for Home Depot.
  • Home Depot continues to transforming its information technology applications by converting their Canadian business to a new enterprise resource planning platform.
  • Recent associate training and procedures concentrate on helping customers with problem solving, rather than simply securing sales.
  • In recent years Home Depot is emphasized a more formalized decision-making process tempering some of the flexibility regional mangers had operated under.

Physical Evidence

  • The average size of a Home Depot store is about 105,000 square feet of enclosed space. Each store has about 24,000 additional square feet in the outside garden area.
  • The company’s stores stock approximately 30,000 to 40,000 different kinds of products.
  • To improve merchandising of its chemical products area, Home Depot has employed new wayfinding signage program to brighten aisle and make easier to navigate between product categories.
  • The garden center area was revised with New table fixture design with larger and brighter wayfinding signage.

.

People

  • Frank Blake is the Chairman and Chief Executive Officer of Home Depot.
  • Tim Crow was hired as Executive Vice President of Human Resources and assigned to oversee all aspects of human resource management as well as address customer service issues.
  • Home Depot plans to increase the number of full time employees and expand their training, while de-emphasizing the use of part-time workers.
  • In 2008 the company issued success sharing checks in excess of $88 million to our hourly associates a new
    record.
  • The company places strong on value on its associates and provides performance based merit increases as well as a 401(k) matching program.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Hewlett Packard Marketing Mix

The company’s foundation was supported by the demand for electronic equipment and microwaves. Gradually, HP has concentrated its offerings in software and technology services. Hewlett Packard went public in 1957 at $16 per share. In 1980, HP introduced the first personal computer (PC), the HP-85; the first handheld computer HP 75C; and the first touch screen PC HP-150. The company merged with Compaq in 2002.

Product

  • Hewlett Packard provides infrastructure technology, business process outsourcing, technology support and maintenance, networking products and resources, application development and support, consulting and integration services; enterprise information technology infrastructure, and software, as well as personal computing and related access devices, imaging and printing related products and services.
  • In 2007 HP introduced the TouchSmart PC, an all-in-one PC with a touch-screen display; HP also introduced a touch-screen consumer tablet PC. In 2008 In April, HP introduced a full-function, mini-notebook: the HP 2133 Mini-Note PC. designed for the education market.
  • Hewlett Packard produces ProLiant, described as an affordable, entry-level rack and tower server ideal for small to medium businesses, workgroups, remote sites, and high-performance computing environments.
  • HP’s product inventory also includes iPaq Glisten Smartphones, with features such as the ability to schedule meetings, email and text, send photos and manage a contact list.
  • Hewlett Packard Home Networking Products such as the Linksys WRT54G2 Wireless-G router which provides a high-speed Internet connection with several computers.
  • HP supports its products with tailored service packages such as the HP Care Pack designed to cost-effectively upgrade or extend a customers’ standard warranty with easy-to-buy, easy-to-use support packages. They reduce downtime risks with support levels from basic to mission critical.

Hewlett Packard Marketing Mix

Introduction

The Hewlett-Packard Company was originated in January 1939 by Bill Hewlett and Dave Packard, two Stanford University classmates. The company incorporated in 1947. Mr. Packard was appointed as the President and Mr. Hewlett as the Vice President. Would you like to take a lesson on the marketing mix?

Price

  • In 2003 Hewlett Packard introduced another first in pay-per-use utility pricing by offering automated technology that can measure the percent utilization of each central processing unit (CPU) on HP Superdome servers, thereby offering significant advantages to customers during slow periods so they do not pay for processing they do not utilize.
  • Hewlett seeks to design products with features and esthetics aimed specifically at consumers. It will first estimate how much consumers will pay, then design products to sell at that price.

Place

  • Hewlett Packard company headquarters are located at 3000 Hanover Street Palo Alto California.
  • HP has subsidiaries located in Miami, Ontario, Geneva, Tokyo, Houston, Singapore, Victoria and Rivonia.
  • Hewlett Packard operates a worldwide program for independent software vendors, developers and system integrators called the Developer & Solution Partner Program (DSPP).
  • The HP website provides a partner locator service sorted by small and business, home and home office, large business enterprises, as well as type of product needed.

Promotion

  • HP launched a branding initiative called, “One Voice,” to better integrate its vast line of consumer electronics and computer hardware products.
  • HP uses many vehicles to tout its business solutions products and services, including a website with videos and navigation by sorted by business application.
  • Key Hewlett Packard employees host blogs covering topics such as networking, servers, enterprises software and storage.
  • Hewlett Packard employs a “Trade-in Program” whereby a customer can get a free quote on an old product and trade it in on eligible products.
  • HP is promoting an instant $300 savings on its ISS Proliant AMD Servers.
  • Hewlett Packard is offering limited time 0% financing on qualifying products and services.

People

  • Hewlett Packard has approximately 321,000 employees.
  • Mark V. Hurd is the chairman, president and chief executive officer.
  • Hewlett Packard hired Davis Shirk in 2010 to run its worldwide marketing for its business enterprise unit.
  • HP founders based their corporate culture on the integration and reinforcement of critical opposites, known as the Hewlett-Packard Way – creating an environment that celebrates individualism, but at the same time one that is also wholly supportive of teamwork.
  • Hewlett Packard provides a career development website to help guide its upwardly mobile employees.
  • HP partners with other organizations such as InRoads and GEM to expand minority employee representation.
  • Hewlett Packard provides chat, phone and email customer service options.

Pysicial Evidence

  • HPs’ “One Voice” project has a goal of developing a fresh design to its packaging while staying on brand across thousands of product lines and dozens of packaging types.
  • Hewlett Packard boasts on of the most thorough company websites online with a wealth of content ranging from an overview of products to philosophy and customer support.
  • Since 1989 HP has worked to develop environmentally responsible packaging, recently the company teamed with the UC Santa Barbara Bren School of Environmental Science and Management and IoPP to create an up-to-date guideline for the electronics industry.

Process

  • In 1997, Hewlett Packard employed the “Hoshin”process in developing its strategic plan. The Hoshin process is a systematic planning methodology for defining long-range key entity objectives without losing sight of day to day business measures.
  • In 2002 HP divulged the supportive planning behind its planned merger with Compac including its goal of achieving a leadership position in every major segment of the information technology industry.
  • Hewlett Packard has utilized Design for Supply Chain (DfSC) system, which is a systematic, repeatable process which allows HP to consider the impact of decisions: on supply chain partners, including suppliers, manufacturing and logistics service providers.
  • One of CEO Mark Hurd’s first acts as CEO, in flush times, was to cut 15,200 jobs (10% of the workforce), he has encouraged remaining employees to stress operational efficiency.
  • Key pillars of the HP strategy include achieving meaningful innovation with speed and agility.

General Electric Marketing Mix

In 2005, the company restructured its operations into six business segments: infrastructure, commercial finance, consumer finance, healthcare, NBC Universal and industrial.

Product

  • General Electric’s capital finance segment includes commercial loans, operating leases, home loans, credit cards, and personal loans.
  • GE’s technology division produces Intrusion and fire detection products, card access systems, aircraft replacement parts, jet engines, medical diagnostics, medical imaging as well as patient monitoring equipment.
  • The company also provides products related to energy infrastructure such as wind turbines, gas turbines, water purification systems, and aircraft engine derivatives.
  • General Electrics NBC Universal Division operates cable networks, and produces motion pictures.
  • Products produced in GE’s Consumer and Industrial Division includes refrigerators, washers, microwave ovens, residential air conditioners as well as electric and gas rangers.

Price

  • General Electric introduced a “Power by the Hour” program for its aircraft engines, in recognition that its customers were not merely purchasing its airplane engines, but also the ability to minimize downtime through its maintenance and service initiatives.
  • In 2004 GE raised prices in for its Infrastructure Water and Process technology customers as a result of increasing cost pressures in a global economy, citing marketplace conditions for water treatment solutions which made it more expensive to do business.
  • General Electric’s “healthtmagination” initiative involves the reduction of prices in its medical imaging imaging and diagnostics business as a result of reduced customer spending in these areas.  

General Electric Marketing Mix

Introduction

General Electric originated in 1892 when Thomson-Houston Electric and Edison General Electric merged. Initially focusing on products such as toasters, motors and light bulbs, it is now a diversified company composed of media, financial services and technology divisions. These divisions provide business and consumer financing services, media content, as well as products such as aircraft engines, power generation, water processing, and security
technology. Would you like to take a lesson on the marketing mix?

Place

  • General Electric is headquartered in Fairfield Connecticut, at 3135 Easton Turnpike.
  • GE has subsidiaries located in Singapore, Mexico, Munich, China and Ontario Canada
  • General Electric has global business projects including Southeast Asia, Northern Asia, Austrialia/New Zealand, Africa, Latin America and Europe.

Promotion

  • In 2001, General Electric selected Responsys, Inc., as the preferred vendor to implement GE Services Network’s email marketing programs.  
  • GE’s slogan “we bring good things to life’ is among the most recognizable in the world.
  • General Electric has used co-branding to market its products, including Culligan, Calphalon and Lenox.

Process

  • The General Electric Company, with the assistance from the Boston Consulting Group and McKinsey and Company, pioneered the nine cell strategic business screen used to identify the most favorable position with attractive growth opportunities as well as competitor strength.
  • In the 1950s GE produced the famous "blue books" — five volumes of detailed guidance for its managers.
  • GE management has utilized techniques such as leadership development, Work Out, and Six Sigma.
  • Current GE leadership is reemphasizing its scientific research labs and marketing function.
  • General Electric undertakes a constant appraisal process that involves firing its bottom 10% employees each year.
  • GE strives to accomplish its goals with four core values in mind: imagine, solve, build, and lead.
  • General Electric (GE) had used the “Lateral Diversification Strategy” as its growth strategy – marketing new products or services that have no technological or commercial synergies with current products, but which may appeal to new groups of customers.

Physical Evidence

  • Russia has been one European country in which GE has made significant investments including an equipment fleet with more than 1,500 large units.
  • The Middle East is diversifying beyond its oil-based economy with explosive development. GE is enabling growth with crucial investments of infrastructure resources such as oil and gas as well as aviation.
  • GE is helping to build the infrastructure of Indonesia.
  • GE has subsidiaries located in Singapore, Mexico, Munich, China and Ontario Canada

People

  • Jeffery Immelt is the current chairman of the board and chief executive officer of GE.
  • General Electric employs an integrity policy called “The Spirit & The Letter” which every employee supports with a signed pledge.
  • GE employs an ombudsmen process which encourages employees to report unethical activities without fear of reprisal. General Electric implements flexible work arrangements in order that employees may achive a work and life balance.  
  • General Electric provides an employee and retired employee outlet store with discount products.
  • GE utilizes skills-based customer service routing technology, GE directs your call to the service or support rep most qualified to answer your question.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Google Marketing Mix

Google’s search engine indexes billions of pages and gives the search speedy results. The engine ranks websites organically regarding links into a page as a positive endorsement or vote. So if people like your pages they will link to them and the page will get a better rank than sites with fewer in-links.

Google was started in 1998 by Larry Page and Sergey Brin with an initial investment of $100,000. The company went public in 2004 and both founders did very nicely thank you (and became billionaires overnight). At that time the duo employed around 7000 people and grew at a tremendous rate, with some claiming that Google was the fastest growing internet company in the world. In 2008 revenues were more than $21 billion and net profit was $4 billion.

Larry and Sergey are now worth an estimated $6 billion. Their story is synonymous with Google’s history. They were brilliant computer science students. They met when Sergey was helping out at a student open day and Larry was one of the prospective students. They became good colleagues although rumour has that they used to debate quite a lot. Eventually they worked together to build some software that could be used to search the internet. They touted it around the early search engine companies of the time but none of them had the enthusiasm that matched that of Larry and Sergey. So they decided to start their own company called ‘Google.’ Their competitive advantage was that the search engine would give objective and useful results – quickly.

Product

  • Google’s income is made through advertising. When a consumer types in a keyword such as ‘contact lenses’ the search engine will display natural or ‘organic’ results – as it would for any search term. However you will notice that at the top and/or along the right hand side of the results, there are a series of advertisements. These advertisements are paid for by companies. The advertising program is called Google AdWords. See ‘price’ below.
  • Google has a relationship with a number of libraries around the world. One of its goals is to digitize as many books as possible and to include them in search result. This could mean that all books are available to everybody. The key problem with this initiative (apart from the enormity of the task) is that Google does not own the rights to all books – the writers and the copyright owners do, and they are not happy. One of those participants is Stanford University.
  • Google is the world’s most popular search engine.
  • Google Earth enables users to view the world from space. That’s a real opportunity for you and me to experience something that our ancestors never did. However there could be security implications. Like any information – it can be used for good or bad. Anyway you’ll notice that the pictures are often dated and taken some time ago. Privacy is also an issue – do you want a satellite taking pictures of your home for the world to see? In 2009 they launched a revised version of Google Earth which includes the opportunity to view 3D oceans.
  • Critics argue that Google is a tool for plagiarism. Plagiarism is essentially cheating by passing off the work of others as your own when submitting assessments at school, college and university. It is the same as copying and is often punished.
  • Google Scholar – which supports a broad trawl of material such as peer reviewed journals, theses and other academic material.
  • iGoogle – a personalized Google page.
  • The ever evolving list of products includes Google finance, Google news, Google blog search, Google video, YouTube, Google sites, Blogger, Orkut, Google Reader, Google Groups, Google Calendar and Google Docs.
  • In 2008 Google Chrome was launched. Google Chrome is an open source browser.

Google Marketing Mix

Google is a search engine. Search engines are used to search the Internet. However Google is much more than a search engine – it’s a global company that specializes in innovation and technology. The business focuses on information made up mainly from web pages, although today all information is absorbed by the Google sponge including books, videos and music. Let’s not take the search engine for granted – masses of information is available to everyone and we all have the potential to develop our own knowledge and learning. Would you like to take a lesson on the marketing mix?

Price

  • How does Google make money? Through a special advertising program called AdWords. AdWords (see ‘product’ above) are keyword-based advertisements that are bought by companies. So if you have a company that distributes contact lenses, you would bid against other distributors of contact lenses for the highest place (or nearby). By bidding for lucrative keywords this raises the price and Google make money. It’s rather like selling a rare item on eBay; the rarer it is the more money you make; the more bidders that compete for the item the more money you make. Hence the more valuable a keyword the more it will make. Advertisers are making more than their investment in advertising, and this makes it an appealing program for business. It is measurable using basic software so advertisers can work out how much they are making on their investment, which is more complex to do with traditional advertising media.
  • Click fraud is a potential problem with AdWords. Every time you click on an advert Google gets paid by the advertiser. Sometimes competitors will fraudulently click on your advert and this is theft, or fraud. Google has many ways of tackling this and click fraud is less of a problem today.

Place

  • The company is located at Mountain View in California. The site looks very much like a university campus with gyms and cafes. The environment enables employees to maximize their time. The Googleplex is the name given to its HQ.
  • Another way of looking at place is that Google is an online business i.e. it distributes using an the internet as its channel.

Promotion

  • Google uses AdWords itself. Often you’ll see adverts with a link to Google’s own services.
  • They include flyers inside business magazines.
  • They use money off promotions to incentivize advertisers to use AdWords e.g. free $20 worth of advertising.
  • Google Chrome has its own TV advert.
  • Google has a Public Relations function that it uses to proactively manage media.
  • Google will sponsor a $30 million competition for an unmanned lunar landing. The winner must land a rover on the moon; the rover should travel 500 metres, and then send back a video to Earth.

Process

  • Google retains your search term. It collects data on searches to help to refine the search algorithm. So don’t think that you search anonymously. Google keeps your search terms and can link them to the address of your computer, and then to you. Whilst Google may not wish to spy on you, governments may take an interest in searching habits and this is a civil liberties issue.
  • If you use Google mail (Gmail) or Google calendar then you are giving even more information about yourself to Google.
  • Google co-operates with the Chinese government in its censorship of certain search terms and results. Is it becoming a political animal, or just maximizing a business opportunity?

Physical Evidence

  • The name Googol means a number followed by 100 zeros. However the founders mistakenly registered Google as their domain name.
  • The company is located at Mountain View in California (see ‘place’).

People

  • In 2008 Google employed 20,000 people.
  • Many of the original employees of Google came from Stanford and other elite US universities. It employs the top brains, and people like working together Google’s innovative business culture. Employees are encouraged to take advantage of 20% time – that’s one day every week working on their personal pet project. They play sports at lunchtime, with Larry and Sergey enjoying roller hockey in the early days.
  • Its motto is ‘Don’t be evil.’ This comes from its informal, collegiate origins. Google can be a success without losing its integrity. However search engines are based upon algorithms which are loaded with choices about what to value and what to include/exclude.

Google’s mission is to organise the world’s information and make it universally accessible and useful. More.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Fox Entertainment Marketing Mix

  • The company has operations in four business segments: Filmed Entertainment, Television Stations, Television Broadcast Network and Cable Network Programming.
  • In April of 2010 Fox joined a group of firms to form a joint venture (Pearl Mobile DTV Company LLC) to develop a new national mobile content service. The service will allow member companies to provide content to mobile devices, including live and on-demand video, local and national news from print and electronic sources, as well as sports and entertainment programming. Other participants include NBC & Telemundo, and ION — and the nine local broadcast groups, which are Belo, Cox, E.W. Scripps, Gannett, Hearst, Media General, Meredith, Post Newsweek and Raycom.

Price

  • In January of 2010 News Corporation offered to purchase the 18% of Fox that it doesn’t already own for $33.54 per share
  • In 2002 The Fox Network commanded 23 cents per subscriber, but planned to increase affiliate fees from cable operators when current long-term carriage deals expired. The higher per-subscriber fees and advertising revenue gains will continue to boost the cable network unit’s financials.
  • The FoxConnect website advertises “Family Guy Volume 8” DVD at $33.99

Fox Entertainment Marketing Mix

Product

  • The Filmed Entertainment segment is involved in the acquisition and production of animated motion pictures and live-action pictures for licensing and distribution primarily in the US, Canada and Europe. The segment also produces original television programs in Canada and the US. The company engages in productions of feature films and television shows. Would you like to take a lesson on the marketing mix?

Place

  • Fox distributes films through several businesses including Fox Filmed Entertainment (FFE), Twentieth Century Fox Television (TCFTV), Twentieth Television and Fox Television Studios (FtvS).  
  • Fox Television Stations owns and operates 35 full power stations. Fox Television Stations operates two stations in nine designated market areas (DMAs), including New York, Los Angeles and Chicago. Of the 35 full power stations, 25 stations are affiliates of FOX Broadcasting Company.

Promotion

  • Fox has employed branded integration techniques in co-promoting Unilever’s Degree for Men deodorant and its drama series “24”. The connection –  the overlapping brand attributes of protection, risk-taking and adventure.
  • In 2010, Fox initiated its “Meet the Family Guy” promotion which involves a Young Adult/College Key Market Event Tour & National Social Media Umbrella Campaign.
  • In March of 2010 Fox News began promoting Sarah Palin’s, Real American Stories, described as a program about folks who have experienced “real-life” adversity.
  • The Fox Connect Website   is promoting a $10 rebate on Glee Volume one-the first season.

Process

  • FOX Broadcasting Company employed Marketshare Partners to conduct a study of television’s importance in the media mix. The study sought to reveals the extent that  television was a central driver of sales results for major advertisers. Fox wanted to know whether television’s effectiveness has been impacted by the appearance of newer marketing media.
  • In January of 2010, all fox sports operations underwent a massive re-organization, FOX Sports, and the company’s 19 regional sports networks, Fox Soccer Channel, SPEED, Fox Sports en Español, FUEL TV and FOX Sports Interactive Media and also the company’s interests in joint venture businesses STATS, LLC. and Big Ten Network, all of which are now housed within the FOX Sports Media Group. The move is designed to maximize the strength of the FOX Sports brand across all platforms.

Physical Evidence

  • Fox Entertainment Group, Inc. is headquartered at 1211 Avenue of the Americas New York City 10036.
  • Fox News Network, LLC Blue Sky Studios, 1211 Avenue of the Americas.
  • Blue Sky Studios, 44 South Broadway, White Plains New York 10601.
  • New York Knickerbockers, 2 Pennsylvania Plaza, 14th Floor New York.
  • New York Rangers, 2 Pennsylvania Plaza, 14th Floor, New York.
  • Fox Searchlight Pictures, 10201 West Pico Boulevard, Building 38, 1st Floor Los Angeles.
  • Twentieth Century Fox Film Corporation, 10201 West Pico Boulevard, Los Angeles.
  • Fox Entertainment can be found online at Linkedin.com.
  • Fox Broadcasting has a website where it offers information on its programming.
  • Fox Kids Network has a website
  • Fox Studios website has a wealth of information on the 20th century fox studio grounds including stages and post production services. 
  • Information of Fox affiliate are found – here. The site provides a map of local affiliates by regions throught the US.
  • The Fox Entertainment Group logo is reminiscent of the old 20th Centrury Fox Logo, with Giant letters and night premier type spotlights on each side of it.

People

  • News Corporation is Fox Entertainment Group’s parent company.
  • K Rupert Murdoch is the Chairman and Chief Executive Officer.
  • Peter Chernin, President and Chief Operating Officer.
  • Fox Entertainment Group employs over 11,500 people.
  • In October of 2009, Fox appointed Roger Mincheff to the newly-created position of Senior Vice President of Branded Entertainment for digital content.
  • Former Fox Atomic executive David Worthen Brooks will oversee creative for the new digital studio, guiding the group’s content strategy and all creative aspects of show development and production.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Facebook Marketing Mix

Timeline is the most recent product innovation (September 2011). This feature allows users to frame their page as a story. It also allows users to include more media such as music and movies. Other new product introductions include photos (where users can share photos about activities), newsfeeds (would provide a summary of recent activity of others that you subscribe to) and groups (which is a customizable area for connecting with friends).

Promotion

Facebook makes most of its revenue through advertising. Their argument is that your customers are using Facebook everyday as the way that they interact with friends. There are three steps to engage with your customers on Facebook. First of all you create your own business page which is free for businesses and is a way of engaging in relationship marketing. So a business would promote a Facebook page on a website, on a business card or any other marketing communication. Then Facebook reason that you should engage with your customers by conversing with them. This means regular posts and offers. You should respond to their comments (although this would work best for a much smaller company) and you will learn how they actually engage with your site or page by using Facebook insights (which is the Facebook metrics tool). Finally you would create an advert, rather like you would with Google Adwords. You also have the opportunity to run a sponsored story. It is advertising that generate most income for Facebook.

Price

Facebook is free. There is no subscription.

Income is made through advertising. You pay for Facebook ads and sponsored stories. Advertisers control their advertising expenses by setting daily or lifetime budgets. Costs are not set in stone. Charges are made by clicks (CPC) or by impressions (CPM) for each advert or story. There are tools on Facebook that help you to work out potential Marketing Budgets. There is a bidding process for popular terms and keywords.

Place

Everything is done online either by using a computer or by using a cellphone or mobile device. One simply registers by the Facebook website to create an account. If you have a cellphone you can download an app and use the social network whilst on the go.

The business itself is physically based at 1601 Willow Road, Menio Park, California. The company currently employs more than 3000 people and it is planning to increase its workforce to about 6600 people. Facebook is about to build a new campus on the other side of Route 84. Facebook in common with Google and other tech companies calls its buildings a campus, rather like the University.

People

Of course Facebook has a few well-known faces of its own. Mark Zuckberg is the co-founder and chief executive of Facebook. The story of this business is now firmly embedded in popular knowledge. This is how the story goes if you haven’t already heard it 100 times! Facebook began in Zuckerberg’s Harvard dormitory room back in 2004. Originally membership was limited to Harvard students but was expanded out to other American universities quite quickly. It spread to all universities and then high schools as well, and then of course the rest of the world!

Other well-known names include fellow students Eduardo Saverin, Dustin Moskovitz and Chris Hughes.

Facebook Marketing Mix

Product

Facebook is a free social networking service. Once you have signed up you create your own profile and publish photographs. You can publish personal information such as your interests, your contact information and so on. Privacy has been a constant issue with Facebook, and more recently users now have the ability to control their settings and to tier their friends and so on.

Facebook has more than 845 million monthly users (December 2011). More than 80% of these active users are from outside North America. Would you like to take a lesson on the marketing mix?

eBay Marketing Mix

The company established its brand as being an entity that connects people (with selling things as a by-product of that emphasis). The company began to move beyond auctioning collectibles and moved into an array of upscale markets where the average sale price (ASP) is higher. Average sales price is crucial to the company’s transaction fee income.

In 1997 the company received approximately $6 million in venture capital from Benchmark Capital. The company went public in 1998. Today the company has revenues exceeding $7 billion annually and boasts over 15,000 employees.

Product

  • PayPal is an online transaction business allowing payments and financial transfers to be made through the internet. PayPal is an alternative to offline transaction methods such as checks and money orders.
  • eBay offers  a marketplaces for the sale of goods and services. It also provides online payment and communication services to individuals and businesses.
  • Products on sale at Ebay include millions of collectibles, décor, appliances, computers, furnishings, equipment vehicles and other miscellaneous items are listed, bought, or sold, daily.
  • Bill Me Later is an Ebay service that provides convenient and secure payment method designed for purchasing on the web or over the phone.
  • Rent.com is an Ebay subsidiary which is a first pay-for-performance online rental site, a business model that outperformed competitors who went with subscriptions, listing fees, or costs-per-lead revenue models The company charges the property manager when a verified lease is produced through the site.
  • Shopping.com is an online community Owned by Ebay it provides a price comparison service and operates webpages in the USA, United Kingdom, France, Germany and Australia.
  • StubHub is a subsiiary of Ebay which acts as an online marketplace for buyers and sellers of tickets to sporting, concert and theater events.
  • Skype is an economical communication tool owned by Ebay. The company provides free video calling , free chat with other Skype members, free instant messaging and call to landlines at low rates.
  • Half.com is a subsidiary of Ebay, Inc in which sellers offer items at fixed prices, usually items that have a ISBN, UPC  or database file indicators as opposed to rare, old or collectible items. The items available on half.com are limited to textbooks, music, movies, video games, and video game consoles.

Price

  • Ebay, Inc. recently changed some of its pricing policies, dictating different listing fees from frequent and occasional sellers.
  • EBay, Inc. Every Day eliminated upfront listing fees (for auctions only, not Buy It Now), and instead charges 9-percent of the final sale price, up to $50.
  • Ebay, Inc. employs a quality click pricing model which pays affiliates "by the click", just like AdSense.
  • Sellers are charged when an item is listed on eBay a nonrefundable Insertion Fee is charged, which ranges between 30 cents and $3.30, depending on the seller’s opening bid on the item.
  • Sellers pay a fee for additional listing options to promote the item, such as highlighted or bold listing.  
  • A final sale price fee is charged to a seller at the end of an auction. This fee generally ranges from 1.25% to 5% of the final sale price.

eBay Marketing Mix

Introduction

Ebay began its business life as AuctionWeb and emphasized collectables. Originally the company was meant to be a marketplace for the sale of goods and services for individuals. The company’s founder was a computer programmer Pierre Omidyar. Its co-founder was Jeff Skoll. Would you like to take a lesson on the marketing mix?

Place

  • New Ebay users can find answers to procedural questions by utilizing the company’s Answer Center located at http://pages.ebay.com/community/answercenter/index.html
  • Ebay provides an international site visibility feature which allows some listings created on eBay.com to be posted on international sites (such as the U.K. site). Buyers on these sites will see the listings exactly as you originally post them on the U.S. site.
  • Ebays Seller Information Center aids participants by offering information on getting started, growth strategies and shipping http://pages.ebay.com/sellerinformation/

Promotion

  • There are eBay Coupons, eBay discounts, eBay Promotional codes, and an eBay bargains page at DealTaker.com
  • The eBay Bucks Rewards Program gives those who use PayPal on Ebay 2% back on qualifying purchases participants get a rewards certificate at the start of each calendar quarter for the amount of eBay Bucks they accumulated in the previous quarter. They have 30 days to spend it on any eBay listing with PayPal.
  • EBay Radio provides traders and eBay community members with the latest in news and views from around the eBay world and covers major eBay events like the annual Ebay Live Conference.

Process

  • Participants who list an item on eBay, are charged an insertion fee. If the item sells, you’re also charged a final value fee. The basic cost of selling an item is the insertion fee plus the final value fee. The basic fee structure depends on the type of listing—auction-style or fixed price format—you use.
  • Ebay provides helpful information to facilitate the use of its services at Ebay University http://pages.ebay.com/sellerinformation/starting/university.html.
  • Ebay facilitates transactions by providing “Daily Deals” which highlight discounted prices parties can sign up to receive a Daily Deals Alert.

Physical Evidence

  • The Ebay, Inc headquarters is located at 2145 Hamilton, Ave, San Jose California.
  • Ebay has introduced a new fashion category.
  • The company has introduced a new Products Review tab enabling a user to find the right product at the best price
  • New Ebay users can find answers to procedural questions by utilizing the company’s Answer Center .
  • Ebay provides an international site visibility feature which allows some listings created on eBay.com to be posted on international sites (such as the U.K. site). Buyers on these sites will see the listings exactly as you originally post them on the U.S. site.

People

  • John J. Donahoe is the President & Chief Executive Officer
  • Pierre Omidyar is Chairman of the Non-Executive Board
  • Scott Thompson  is President of Paypal
  • BobSwan is Senior Vice President
  • Ebay purchases are now under a new Buyer Protection Program which covers a buyers full purchase price and shipping and implemented via a new streamlined customer service procedure.
  • Ebay Feedback is a procedure that lets participants monitor their transaction reputation as an eBay member. It’s made up of comments and ratings left by other members you’ve bought from and sold to.

Apple Marketing Mix

After obtaining financing for the development of Apple II, the Apple Computer Company was formed in 1970.As the growth of home computer use grew, Apple grew with it. In 1980 the company issued its initial public offering of investment stock.

Apple next introduced the MacIntosh Computer in 1983 during the Super Bowl. The computers desktop publishing features provided the foundation for future innovations that have become standard for the company. Today Apple, Inc has more than 33,000 employees and revenues exceeding 42 million dollars.

Product

  • Portable Computers – including Mac products such as Mac Book Pro, iMac, MacBook Air, Mac Mini, Xserve
  • Servers – including Xserve, Xsan, MacOS X Ser, MobleMe.
  • Accessories – including MagicMouse, Keyboard, Led Cinema Display.
  • Wi-fi Based Stations – including Airport Express, Airport Extreme, Time Capsule.
  • Developer – including Developer Connection, Mac Program, iPhone Program.
  • iPod – including iPod Shuffle, iPod Nano, ipod Classic.
  • iPhone – including iPhone3GS, iPhone3G, iPad.
  • iTunes – including movies, TV shows, audio books, games.
  • Periphal products – including Printers, Storage devices, digital videos and cameras.

Apple Marketing Mix

Introduction

Apple, Inc originated from the friendship and mutual interests of Steve Wozniak and Steve Jobs. The Two collaborated in the development of the “Apple I in the early 1970s. The Apple I was a step ahead of most computers of the time featuring a use of aTV as a display system and a cassette interface for recording programs. Would you like to take a lesson on the marketing mix?

Price

  • Apple is a premium brand computer that does not attempt to compete on price. The company has reduced prices after some initial product launches. It uses skimming and preimuim pricing strategies.
  • The AppleiPad is priced at a minimum of $499.
  • The Apple iPhone costs begin at $99.
  • The Apple iPod Classic is priced starting at $249.
  • The Apple iPod Nano costs $149.
  • The Apple Mac Book costs $999.
  • The Apple MacBook Pro is priced at $1199.
  • The Apple Quicktime Pro for Windows costs $29.99
  • Apples iPad pricing strategy includes the flexibility to lower the prices if consumer response dictates such action. This would be consistent with a similar $200 price cut on the iPhone in 2007.
  • In 2009 Apple announced a reduced cost pricing structure for iTunes – songs will cost 69 cents, 99 cents or $1.29. He said the “vast majority” of the songs will cost 69 cents. Changes are said to be a response to a slower pace of music downloads.

Place

  • Apple, Inc Headquarters are located at is located at 1 Infinite Loop, Cupertino, California.
  • The Apple Consultants Network includes independent professional service providers and technology consulting firms that specialize in Apple and third-party solutions. Certified on Apple technologies, these providers deliver on-site technology services and support to home users and businesses of all sizes.
  • Apple service providers are certified technicians, who complete regular Apple training and assessments, and offer repair services, and exclusive access to genuine Apple parts.
  • They are located in Asia/Pacific, Africa, the Middle East Europe and Latin America.
  • Apple has over 200 retail stores worldwide including the US, UK and Canada. Apple recently opened a new retail store in Shanghai China.

Promotion

  • Apple, Inc offers special discounts on refurbished MacIntosh computers, iPod Nanos, and the 8GB iPod Touch. In each case a 1 year warranty is included on the all products.
  • Apple, Inc authorized Training Centers are located throughout the U.S. each provides instruction in Mac systems, Mac OS X, and Apple’s professional applications. A wide range of certification exams and courses offer innovative learning opportunities for IT and creative professionals, educators, and service technicians—delivered exclusively by Apple Certified Trainers.
  • The Apple Consultants Network website provides a search tool allowing visitors to locate nearby certified Mac product consultants in the U.S, Canada, and a number of international locations.
  • The online Apple Store offers free shipping for orders over $50.
  • The online Apple store offers iTunes gift cards.
  • Apple provides a $100 rebate when you purchase a Mac or specific printers from the online store.
  • Apple has packaged back-to-school offers, including some aimed at college students.
  • People

    • Stephen P. Jobs is the Chief Executive Officer of the Executive Board at Apple, Inc
    • Non Executive Board Directors include William V. Campbell, Millard S. Drexler, Albert Gore, Andrea Jung and Author D. Levinson.
    • Key Senior Management team members include Timothy D. Cook, (COO), Scott Forestall, Jonathan Ivey, (Industrial Design), Ronald B Johnson (Retail), Robert Mansfield Mac Hardware Engineering), Peter Oppenhiemer (Chief Financial Officer), Mark Papermaster (Devices Hardware Engineering), Philip W. Schiller (Worldwide Marketing), Bertrand Serlet (Software Engineering), and D. Bruce Sewell (General Counsel).
    • Some certified Apple service providers offer additional services beyond repairs and parts such as such as data transfer, data recovery, upgrade services, and onsite deployment and installation.
    • Every Mac, iPod, iPhone, and display comes with complimentary telephone technical support for 90 days after your purchase and a one-year limited warranty. The AppleCare Protection Plan extends your service coverage and gives you one-stop service and support from Apple experts.
    • The AppleCare Professional Video Support gives you direct access to Apple’s Professional Video Technical Support team via telephone and email 12 hours a day, seven days a week.

    Physical Evidence

    Process

    • Apple converts new customers and secures their loyalty through a corporate emphasis on customer service.
    • Apple seeks to attract its target market through bold public relations events (such as the MacWorld Expo) as well as advertising imagery which borrows from contemporary modern art.
    • Apple has expanded its distribution channels in recent years including the addition of Wal Mart.

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Burger King Marketing Mix

Currently Burger King operates in about 71 countries worldwide, but it all began in Miami where the first restaurant was opened in 1954, and began to grow exponentially after the introduction of the Whopper sandwich in 1957. The firm became a publicly traded company in 2006.

Product

  • As a fast food hamburger restaurant (FFHR) chain, Burger King produces, hamburgers, cheeseburgers as well as Fries, Salads, Hash browns, Onion rings, Coffee, Juice, Shakes, cookies and pies.
  • Burger King sets itself apart from competition with its “have it your way” theme which allows individualize each orders with many options including fries or onion rings, cheese, bacon, mustard, ketchup, mayonnaise, lettuce, tomato, pickles, and onion.
  • The nation’s No. 2 burger chain will add Starbucks Corp.’s Seattle’s Best Coffee to all its U.S. restaurants in a phased roll-out that begins in the summer of 2010. Under the effort, more than 7,000 Burger King Restaurants will begin selling the coffee along with iced varieties that also come with a choice of plain, vanilla or mocha flavors and whipped toppings.
  • Burger King has signed a licensing deal with ConAgra Foods Lamb Weston which will result in offering a retail line of microwaveable Burger King Brand French fries at select retailers in the United States, including Wal-Mart.

Price

  • Burger King recently joined McDonalds in offering a $1 double cheese burger.
    Some of its franchises claimed the price reductions cut into profits. Burger King has reportedly ended its unpopular (among franchise owners) $1 double cheeseburger promotion.
  • Burger King plans to sell slushy drinks for $1 leading into the summer in order to offer an alternative to McDonalds $1 summer drink.
  • The company also will continue to sell its new premium burger, the Steakhouse XT, for $3.99 through mid-September, with another national television ad splash planned in August.

Burger King Marketing Mix

Introduction

Based in Miami, Florida, Burger King is one of the worlds best known fast food restaurants (it is the second largest company in the world). The company’s 40,000 plus employees helped it earn over $190 million dollars in 2008. Its success is reflected in a 28.4 percent increase in net profits for FY 2008. Would you like to take a lesson on the marketing mix?

Place

  • Burger King operates its business via franchises, under a franchise arrangement, the franchisees invest in the equipment, signage, seating and decor, while the company owns or leases the land and building. The company generates revenues from three sources: sales at company restaurants, royalties and franchise fees and property income from those franchises that lease or sub lease property from the company.
  • Burger King occupies primary locations.

Promotion

  • Burger Kings Big Value Menu $1 Talent Show invites customers to display their talent via videos they submit with the goal of winning a menu item.
  • The company has coined the term “next best move” to feature scheduled promotional tours with stops in urban communities around the country. The effort is augmented by a special website where
    Participants can describe community service contributions.
  • Burger King is backing its biggest product launch of the year, the Tendercrisp Premium Chicken burger, with a promotion theme encouraging consumers to “cheat on beef”’.
    The campaign began in March of 2010 using ads created by Crispin Porter & Bogusky.

Process

  • A Burger King strategy has focused the customer segment that spends the most money at its restaurants. These young men and women visit fast-food burger chains on average almost 10 times per month.
  • The company has employed a combination of “loss leader” promotions” coupled with upsells of more expensive menu items, specifically higher-margin French fries and soft drinks.
  • Recently Burger King has concentrated on adding restaurants and entering new strategic markets. They have added over 400 new restaurants in the last three years.
  • The company seeks to further growth and popularity via its innovative marketing promotions such as the King television commercials.

Physical Evidence

  • Burger King, based in suburban Miami, Florida, operates more than 11,900 restaurants in all 50 states including 107 in Alabama, 122 in Arizona, 336 in Michigan and 547 in its home state of Florida.
  • Burger King has an internet presence via its website BK.com. The site provides company information such as a video history of the company, press releases, and stock information.
  • The company is in the process of reinventing its image via key changes in its decor. Its new restaurants will feature modern, box-like architectural lines and urban-industrial building materials, including corrugated metal.

People

  • John W. Chisley is Burger King’s Chief Executive Officer and Executive Chairman of The Board. He has served in the CEO capacity since 2008.
  • Alexandra Galindez the director of multicultural marketing for Burger King and in charge of implementing its “Next Best Move” initiative, which seeks to strengthen its standing in urban communities by conducting a national tour to community basketball courts in 41 markets.
  • In 2009 Black Enterprise magazine named Burger King one of the “40 Best Companies for Diversity.”
  • Burger King pairs its “have it your way” theme with speedy customer service. To facilitate fast service Burger King takes customer orders on a continual basis. After an order is taken, the customer then moves down the line where another employee is preparing the order. Meanwhile, the original employee is taking another customer’s order. Customers also get their own drinks while they are waiting for their meal.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Dreamworks Marketing Mix

Originating in 1994, DreamWorks was launched by a partnership of Steven Spielburg, Jeffrey Katzenburg and David Coffin. In 2001, the company released Shrek movie. Shrek won the first-ever Academy Award for Best Animated Feature in 2001. The company executed a seven-year distribution agreement with Paramount Pictures for the rights to distribute DreamWorks Animation films in theatrical, home entertainment and television markets worldwide in 2005.

Product

  • DreamWorks Animation develops and produces CG animated feature films among its output include CG animated films, Non CG animated films, widgets and games. DreamWorks also produces movies such as Bee Movie, Flushed Away, How to Train Your Dragon, Kung Fu Panda, Madagascar, Shark Tale, Shrek 2, Shrek the Third and Sinbad: Legend of the Seven Seas.
  • DreamWorks Television is a television production division of DreamWorks SKG which has produced telivision programing such as Carpooler, The Pacific, The United States of Tara and The Contender. It has also produced TV specials such as Shrek the Halls and Merry Madacascar.
  • All of DreamWorks Animation’s feature films are now being produced in 3D.

Price

  • Blu-ray discs ($25.99) at Toys or Us, Madagascar ($25.99) at Toys or Us, and Disturbia.
  • Shrek DVDs ranging from $10.99 on ebay to $59 on Amazon.
  • How to Train Your Dragon $199 from DreamWorks animation.
  • 5 Pack of Hit dream Movies (including Antz) on Google Products for $35.

DreamWorks Marketing Mix

Introduction

In 2008, DreamWorks Animation generated over $650 million through its development and production of computer generated animated films and TV specials. Operating out of Glendale, California, DreamWorks employs approximately 1,700 people. Would you like to take a lesson on the marketing mix?

Place

  • Currently, United International Pictures, a joint venture of Paramount and Universal, has the rights to release DreamWorks’ films internationally, and will also handle releases from the new DreamWorks.

Promotion

  • DreamWorks Animation hosted the first a live streaming event about Shrek Forever.
  • Shrek fans were able to use Facebook to send questions and messages, chat and invite others to attend the Green Carpet Coverage.

  • DreamWorks partnered with McDonalds for the production of a Shrek Forever” themed happy Meal. The project will use Shrek to encourage kids to eat more fruits, vegetables and dairy products. The May 14th launch will be followed up by an international launch.

Process

  • DreamWorks is co-producing some projects with its competitors (and sharing profits from) six other studios’ summer blockbusters, including Paramount’s Transformers: Revenge of the Fallen and The Uninvited in addition to Montecito Pictures’ I Love You Man. These arrangements have enabled DreamWorks to reduce its risk, even as it increased profits.
    Currently, United International Pictures, a joint venture of Paramount and Universal, has the rights to release DreamWorks’ films internationally, and will also handle releases from the new DreamWorks.

Physical Evidence

  • DreamWorks is located at 1000 Flower Street in Glendale California.
  • DreamWorks boasts a well recognized logo features a young boy sitting on a crescent moon with fishing pole in hand. The music accompanying the logo to start each new DreamWorks movie was composed by John Williams. The main logo shows the scene at night, while the DreamWorks Animation logo reflects the same image in daylight.
  • DreamWorks studios has a website which provides news on forthcoming studio productions such as “Quartermain “, as well as its leadership team. In addition DreamWorks Animation sports a website dominated by the latest Shrek movie related items.

People

  • DreamWorks was founded by Steven Spielberg, Jeffery Katzenberg and David Geffin.
    The Company has world-class creative talent, a strong and experienced management team and advanced filmmaking technology and techniques.
  • Heather O’Conner assumed the role of DreamWorks Chief Accounting Officer in 2010, taking the Place of Phil Cross who will remain a consultant to the company.
  • Kelly Avery is the head of Franchise Strategy & Distribution where she is responsible for overseeing the development of the studio’s global franchise plan, including new product and business initiatives.
  • DreamWorks is listed number six among the Top One Hundred Companies to Work For.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Time Warner Marketing Mix

Time Warner Entertainment was formed in 1992. The company launched a number of magazines, TV channels and theme parks in the early 1990s. In 1991, Quantum Computer Services officially changed its name to America Online and went public in the following year. Time Warner Telecommunications was launched in 1993 when Time Magazine first appeared on AOL. During 1994, AOL acquired a number of companies that specialized in internet and multimedia publishing, and by mid 1995 it had over 2.5 million subscribers. The Time Warner and AOL merger was announced in 2000.

Product

  • Time Warner is a dominant media and entertainment company whose key business segments include cable, filmed entertainment, networks, and Internet access subscription services. Specifically, their inventory of brands includes AOL, HBO, CNN, Time, Fortune, People, Sports Illustrated, Time Warner Cable and Warner Brothers.
  • Time Warner’s cable division includes Video services, Analog services, Digital services, On-Demand services, DVRs, High definition services, Interactive services, High-speed Data Services Road Runner, Time Warner Cable Business Class, Voice services and Digital Phone.
  • The company’s filmed entertainment division includes distribution of theatrical motion pictures distribution of television shows, Animation, distribution of home video products, licensing of programs and characters plus television programming.
  • Time Warner’s Network Division entails sports franchises cable networks, pay television, services, broadcast television network, and pay television programming.
  • The company’s Publishing Division produces books and magazines.
  • Time Warner’s Internet access subscription services are primarily operated through AOL.

Time Warner Marketing mix

Time and Warner Communications began operations in the 1920s. Henry Luce and Britton Haddon founded Time in 1922. The first issue of Time Magazine appeared in 1923. Warner Brothers (Warner Bros) was incorporated by brothers Harry, Abe, Jack, and Sam Warner in the same year. Warner Bros went public in 1925. Time merged with Warner Communications in 1989 to form Time Warner. Would you like to take a lesson on the marketing mix?

Price

  • Time Warner announced cable rate increases ranging from 6 to 8 percent depending on regions of the country.
  • Time Warner’s Talk ‘n’ View package, of telephone and cable television service, will rise from $100.50 to $108.95 – an increase of about 8 percent.
  • “Surf ‘n’ View”, a combination of Internet and cable television, will increase from $105.50 to $111.95, an increase of 6 percent.
  • “All the Best”, which combines cable, internet and phone, will rise from $135.50 to $144.95, or 7 percent.
  • The projected increases are said to result from increasing carriage fees faced by Time Warner which is passing some of the cost along to customers.
  • Customers can minimize price Time Warner price increases by opting for longer term agreements such as offered in the “Price Lock Gaurantee”
  • In 2008 AOL increased subscriber rates by $2 to $11.99 per month, unless they decide to give up technical support by phone. AOL says the higher rate is still $3 to $10 less than monthly fees charged by other Internet service providers.

Place

  • Time Warner’s Head Office is located in the Time Warner Center, New York City, New York.
  • Turner Broadcasting System is located in Atlanta Georgia at the CNN Center.
  • Home Box Office Warner Brothers Entertainment is based in Burbank California.
  • HBO is located on the Avenue of the Americas in New York New York
  • Time Warner Cable operates in 31 states, including Alabama, Arizona, California, Colorado, Georgia, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky, Maine, Massachusetts, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Texas, Virginia, Washington, West Virginia, Wisconsin and Wyoming.
  • In 2008, Time Warner Cable Business Class launched its nationwide agent channel program, a national channel strategy, allowing channel partners to deploy its services across all company markets. It will have one set of price points and one set of products.

Promotion

  • In 2010 Time Warner introduced its “Online Customer Care Team, Led by Online Customer Care Manager Phil Blum, the four-person team will use e-mail, Twitter, and other forms of social media to get customers help anytime, anywhere, and on any device.
  • In November of 2009 Time Warner’s Turner Classic Movies invited fans around the country to its “TCM Classic Film Festival”, scheduled for spring 2010.
  • Time Warner’s Warner Brothers Home Entertainment Group launched a DVD to Blu-Ray upgrade program which will let customers select from over 50 movie titles to upgrade.
  • Time Warner Cable Package deals provides a toll free number and special promotion codes for specially bundled services.

People

  • Time Warner has over 31 000 employees.
  • Jeffery L. Bewkes is the Chairman and Chief Executive Officer 
  • Bill Nelson is the Chairman and Chief Executive Officer of HBO.
  • Phillip Kent is the Chairman and Chief Executive Officer of Turner Broadcasting.
  • Ann S. Moore is the Chairman and Chief Executive Officer of Time, Inc
  • Barry M. Meyer is the Chairman and Chief Executive Officer of Warner Brothers Entertainment.
  • Each divisional CEO has an annual plan for diversity that supports multicultural market expansion, workforce diversity development, and workplace inclusion.
  • People magazine reaches one out of every five Hispanics; nearly one third of HBO’s subscribers are people of color; over 20% of “Adult Swim’s” audience is African-American; and “House of Payne” on TBS is cable’s #1 ad-supported sitcom telecast of all time.

Pysicial Evidence

  • Time Warner’s corporate web page www.timewarner.com  provides a wealth of information on its management policies, citizenship and investor relations as well as recent news releases.
  • Time Warner and its main divisions Turner Broadcasting, Home Box Office, Time, Inc, and Warner Bros. Entertainment each have unique, specially created pieces of artwork for its logos.

Process

  • Time Warner Cable’s nationwide agent channel program will allow channel partners to deploy its services across all company markets. The benefits include one set of price points and one set of products.
  • In December of 2009 Time Warner spun off AOL in order to streamline its operations and be more focused on creating packaging and distributing content.
  • Recently Time Warner entered into a video distribution agreement with YouTube calling for YouTube to host content from a wide rage of its television shows and movies.
  • Time Warner has partnered with Canon Business Solutions to provide employee training on environmentally responsible methods to use printers and copiers.
  • Home Box Office is seeking to establish criteria for purchasing products that reduce the impact on the environment.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Yahoo Marketing Mix

The growth of web directories and search engines in the nineties prompted Yahoo to begin a series of business acquisitions including Four11, Rocketmail, and eGroups and Classic Games.com. Subsequently, Yahoo also obtained other competing search engines, including Overture, Altavista and AllTheWeb.

Today, Yahoo is a company earning over 6.4 million in revenue and employs 13,900 people and its various websites are visited up to 300 million times per month.

Product

  • Yahoo! (Yahoo) is a leading global internet businesses, which provides internet services to individuals and businesses worldwide.
  • Yahoo! Home Page – including My Yahoo, Yahoo Toolbar, Yahoo Local and Connected TV.
  • Communities & Services – including Yahoo Groups, Yahoo Answers
    and Flickr.
  • Search Services – including Yahoo Search, Yahoo Local, Yahoo Yellow Pages, and Yahoo Maps.
  • Communications Services – including Yahoo Mail, Zimbra Mail, and Yahoo Messenger.
  • Connected life – including Yahoo Mobile, Yahoo Go, Yahoo Broadcast, Yahoo Digital Home, and Yahoo Desktop.
  • Audience Services – including Yahoo News, Yahoo Finance, Yahoo Sports, Yahoo Autos, Yahoo Food, Yahoo Games, and Yahoo Health.
  • Major Products and Services – including Yahoo Kids, Yahoo Movies, Yahoo Movies, Yahoo Music, Yahoo Personals, Yahoo Real Estate, Shine, Yahoo Shopping, Yahoo Tech, Yahoo Travel, Yahoo Travel Yahoo! Kids and Yahoo TV.

Price

  • Yahoo Search employs quality-based pricing, which measures the quality of traffic coming from its distribution partners i.e. web publishers that display your paid ads.
  • Yahoo Ecommerce rates for small business range from $39.99 (starter) to $129.95 (Standard) on up to $299.95 (Professional) in monthly costs.
  • Yahoos Build Your Own Search Service (Boss) employs a “pay for what you use pricing approach rather than a one size fits all for its developers customers. The rate is calculated by number of queries and how deep they go.
  • Yahoo domain service prices range from the length of term, i.e. 1 year costs $9.95, two years $19.90, 4 years $29.85 and 5 years $49.75.
  • Yahoo Web Hosting prices range from $9.95 per month (if the term is 1 year) to $12.95 if the term is on a monthly basis.

Yahoo Marketing Mix

Introduction

Yahoo originated in 1994 as “Jerry’s Guide to the World Wide Web” (a directory of other websites). The name was then changed to Yahoo. The value of the directory created by David Yang and David Filo soon became apparent after receiving over 900,000 hits. The company held its initial public offering in 1996. Would you like to take a lesson on the marketing mix?

Place

  • Yahoo operates an affiliate program whereby online marketers can promote its Hosting Services, Yahoo Mail Plus, Yahoo Games, Yahoo Hot Jobs and Merchant Solutions for commissions ranging from $10 to $90.
  • Yahoos online Search Marketing Distribution Network includes AllTheWeb, MSN, Info Space, Net Zero, DreamWiz, HP and AltaVista.

Promotion

  • Yahoo has developed a new ad campaign which uses the slogan “your favorite stuff all in one place “, and takes a swipe at its competitor, Google.
  • The Yahoo logo has remained essentially the same since its inception with color changes being the biggest difference over time. Its brand is rated in the top 100 by Rate the Brands.
  • Yahoo has run radio and television ads comparing itself favorably over Google.
  • Yahoo has entered into partnership with Gannett in which all of Gannett’s 81 local publishing organizations and seven of its Broadcasting Division sites will sell Yahoo! advertising inventory as part of Gannett’s local advertising solutions.

People

  • Carol Bartz replaced Jerry Yang as CEO.
  • Jerry Yang, Chief Yahoo
  • Roy Boystock, Chairman of the Non-executive Board
  • Patti S. Hart, Director of the Non-executive Board
  • Michael J. Callahan, General Counsel
  • Tim Morse, Chief Financial Officer
  • Yahoo is expanding its customer service operations to add more call center employees who can speak more languages.

Physical Evidence

  • Yahoo has subsidiaries located in Singapore, Beijing, Hong Kong and India.
  • The company offers localized versions of Yahoo! in Argentina, Australia, Brazil, Canada, France, Germany, Greece, Ireland, and Italy.
  • Yahoo News http://news.yahoo.com/ is a website that gathers up to date information on business, entertainment, health and politics, etc.
  • Yahoo operates an online Real Estate site – http://realestate.yahoo.com/Homevalues where prospects can search home values and recent sales in their locality.
  • Yahoo! Safely is an online resource located at http://safely.yahoo.com/ that caters to kids, parents, and educators which provides relevant, up-to-date strategies and tools to help foster safer online experiences.
  • Yahoo! has partnered with Facebook to allow both Yahoo! and Facebook to link accounts, view and share updates with friends across both networks. Additionally, people who create and share content on Yahoo! sites – including Yahoo! News, Yahoo! Sports, Flickr, and many Yahoo! entertainment sites, such as omg!, Yahoo! TV, and Yahoo! Movies – can easily share their actions with friends back on Facebook.

Process

  • Yahoo recently implemented a new Google AdWords Importing Tool that allows advertisers to easily take their exported Google AdWords campaigns and import them directly into their Yahoo! Search Marketing account.
  • Yahoo regularly recruits out-of-the-box thinkers which increases their capability to produce new products and services.
  • Yahoo has enhanced its global reach by creating more targeted advertising and country specific services.
  • Yahoo has recently bolstered its role in the online community niche by acquiring Flickr, del.icio, and Web Jay. The goal is to build internet communities that interact and assist each other in information searches.
  • Yahoo employs a delayed deployment strategy which delays new service launches until the product is more “robust” and undergone testing.
  • In 2008 Yahoo held a “Open Hack Day” during which I invited developer to experiment with different utilities from existing Yahoo sites. The goal was to facilitate innovation.
  • Yahoo seeks to use site features to achieve the “sticky” affect, i.e keep visitors on its sites
  • Yahoo uses Joint Ventures to achieve recurring income.
  • Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Yahoo SWOT

SWOT Analysis Yahoo!

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Strengths.

  • Yahoo!’s Overture is a tremendously profitable Internet advertising business. It focuses on affiliate advertising for large advertising accounts, in the same way as Google’s Adsense programme. This is an important income stream for Yahoo!.
  • Yahoo! has over 350 million users of its services and solutions. This makes it a very powerful marketing company, with a very well known brand. Some reports indicate that is it is the most popular website in the World.

Opportunities

  • The international market is a huge opportunity for Yahoo!. Yahoo!, Microsoft and Google are busy carving niches and taking over businesses in are around the Greater China Region. China has over 1,200,000,000 citizens. Other economies, such as India, also offer tremendous growth potential.
  • The Development of the Yahoo! Directory has potential for new business and income streams. Two thirds of organizations in Ohmae’s Triad (Europe, Japan and the USA) are Small Medium Enterprises (SME’). SME’s are potential directory advertisers.
  • Mobile technologies offer another opportunity for Yahoo!. Today we access the Internet using personal computers. Tomorrow phones, televisions, personal organisers, music players and computers will merge and morph. The mobile devices of the future will need services and solutions. Yahoo! would be well placed to provide many of them.

Threats.

  • The biggest threat for all web-based organization is competition. Huge profits attract investors, innovators and entrepreneurs. Dotcom fever has not gone away, it is now more focused on profit delivery. All of Yahoo!’s key services have competitors such as AOL, Google and many others.
  • International, culture specific competitors could affect Yahoo! in the future, unless strategic alliances are forged. China has developed its own search engines, as has India. Why should the World use USA based companies such as Yahoo!? There needs to be a series of substantial competitive advantages to see the business remain as an international brand. Look at what has been learned from the global car industry, or electronics industry.

When Yahoo!! was founded in 1994 by Stanford Ph.D. students, David Filo and Jerry Yang, it began as their hobby and has evolved into a global brand that has changed the way people communicate with each other, find and access information, and make purchases. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • A key long-term strength is Yahoo!’s international business presence. As the Internet expands and it is adopted by more nations the opportunities for Internet brands begin to emerge. Yahoo! is well placed to take advantage of these opportunities with its strategic business units in Asia, Europe and Australia.
  • The Yahoo! Directory is an original source of structured information. It has built over the last decade, and unlike mainstream search engines, its content is moderated (i.e. sites are vetted before their inclusion).

Weaknesses.

  • Differentiation is difficult for Yahoo!. Almost all of its packaged services are available from other sources.
    1. (i) Search facilities are available on MSN and Google.
    2. (ii) Free E-mail accounts are available from Hotmail (MSN) or G-Mail (Google), and many, many others.
    3. (iii) New is available from CNN or the BBC.
    4. (iv) Shopping is available everywhere on the Internet. Google has Froogle.
  • Online advertising is a new income stream for organizations such as MSN, Yahoo! and Goggle. Yes, today they are very, very profitable. However, as technology develops and new unforeseen advertising media emerge, the future is uncertain for these income streams. This is a weakness for Yahoo! and its competitors.
  • Another income stream that has been key to Yahoo! is derived from its partnerships with telecommunication providers. For example, you buy an Internet connection package from your local telephone company, and it includes a fee-based Yahoo! package including e-mail accounts, user support and other added value services. If ever this channel is changed or removed, the income stream would be affected.

Williams Sonoma SWOT

Williams-Sonoma SWOT

Company Overview

Williams-Sonoma is a US based specialty retailer of higher-end lifestyle and home furnishing products. They sell their merchandise through three channels: retail stores, catalogs and six websites. It is headquartered in San Francisco, California. Would you like a lesson on SWOT analysis?

  • Their strong brand portfolio caters to an upper-class, higher-end consumer niche of the home furnishing and accessories industries. Their portfolio, focused on various demographic segments and varied customer needs, provides a competitive advantage.
  • The company’s core brands are Williams-Sonoma, Pottery Barn and Pottery Barn Kids.  
    • Williams-Sonoma focuses on kitchen-related cookware and other products including pots, pans, cookware, knives, storage containers, small electrical appliances, table linens, flatware and glassware. They also have higher-end private label food products.
    • Pottery Barn stores sell oversized, stuffed chairs, candles, mirrors, frames, pillows, blankets, rugs and window treatments and furniture.
    • Pottery Barn Kids is an extension of the Pottery Barn concept and focuses on children’s furnishing and accessories. Pottery Barn Kids also offer the option of customization of products.
    • PBteen targets teenagers with its bright colored, sport themed, customized and other theme-based lifestyle products.
    • West Elm’s products are more simple and modern than what is usually found in a Pottery Barn store. The merchandise is priced at ‘mass market’ points.
    • Williams-Sonoma Home targets high-end customers with its more formal furniture and home decor products.
  • In 2008, the company implemented a new retail inventory management system. This gave them a strong retail and operations system, as well as an advantageous distribution system. They are highly successful at logistics, inventory management of stores and delivery of stock through their catalogs and websites.

Weaknesses

  • Similar products are available at a lower price point in big box stores such as Target and Wal-Mart stores.
  • Multiple retail channels increases proximity with customers, which in turn, would lead to top line growth. However, the US home furnishings store industry is fragmented with 50 largest companies comprising 70% of the industry sales, making it a difficult industry to survive in.
  • The company has had declining profitability since 2006. The company’s operating profit and net profit declined from $345.1 million and $214.9 million in 2006 to an operating profit and a net profit of $313.4 million and $195.8 million in 2008.
  • The decline in profitability, operating cash flows and margins could hamper expansion plans which could erode the investor confidence in the company.
  • The company faced a copyright infringement suit in 2008, alleging that they used copyrighted designs for their rugs.
  • In 2008  the housing sector in the US experienced one of its most significant downturns in 40 years. This downturn resulted in substantial volatility in the financial markets and depressed growth rates in the home furnishings and accessories industry overall.
  • Consumer Confidence in the US declined in 2007-2010, due to lower sales of homes, rising fuel prices, a weaker labor market and stricter laws for borrowing money.

Opportunities

  • The company is working on restoring sales and the reputation of its core brands through a five pronged strategy: offering innovative, unique products to its core customers, capitalizing on the changing trends; improving its marketing and visual merchandising for a more exciting shopping experience; and is testing new shipping charges.
  • They are stressing value to attain competitive advantage, changing their product display and presentation in stores. This includes remixing the assortment, re-allocating floor space among categories, and improving in-store merchandising.
  • They increased retail leased square footage by approximately 8% in fiscal 2009 and also plans to expand or remodel additional 20 stores.
  • They are putting high emphasis on direct marketing in order to enhance customer reach. In FY2008, the company improved its online sales operations by implementing new functionality in DTC marketing systems, which enabled the company to reduce catalog circulation and improve the relevancy of its on-line marketing.
  • They have also begun to focus on cost cutting in order to obtain a competitive advantage.  They reduced the shipping rates of Pottery Barn products. Williams-Sonoma adjusted the shipping rates in its 2008 spring catalog. Reducing shipping rates could lend towards ‘Pottery Barn’ brand revitalization, acquiring new customers and also translate to growth.
  • Moving into a global economy could diversify risk and create a more recognizable brand name.
  • They can also consider partnering with Whole Foods, Inc., an organic grocery chain that caters to demographically similar customers.

Threats

  • Williams-Sonoma faces intense competition from local, regional and national retailers including department stores, specialty stores, mail-order retailers, discount and mass merchandize stores, and national chains. Their major competitors are Bed, Bath & Beyond, Crate and Barrel, Wal-Mart, Target, Home Depot, JC Penny, Haverty Furniture, and Cost Plus.
  • Any continued long-term slowdown in US housing market will continue to affect their sales and revenues. As sales of houses slow down, so does the sale of home furnishings, home improvement products and accessories.

References

MarketLine. (2010). Williams-Sonoma Company Overview. Retrieved on September 8, 2010 from www.marketline.com

Wikiwealth. (2010). Williams-Sonoma (WSM) Stock Research, Investment News & SWOT Analysis. Retrieved on September 9, 2010 from http://www.wikiwealth.com/research:wsm

Charles E. Williams established the first Williams-Sonoma store in Sonoma, California in 1956. The company began its direct-to-customer (DTC) business in 1972 by launching its flagship catalog, under Williams-Sonoma brand. They acquired Pottery Barn, a retailer of casual home furnishings, in 1986, from The Gap. The first Pottery Barns Kids store was opened in 2000, and its website followed a year after. Williams-Sonoma is a US-based multi-channel retailer of lifestyle products that focuses on home furnishing and accessories. The company offers home products ranging from culinary, and serving equipment such as cookware, cookbooks, cutlery, informal dinnerware, glassware, table linens, specialty foods, cooking ingredients to home furnishings. Williams-Sonoma markets these products through retail stores, catalogs and through the Internet.

Mr. Williams procures the merchandise for the company from foreign and domestic manufacturers and importers located in about 43 countries, located primarily in Asia and Europe. The company operates through two segments: retail and direct-to-customer (DTC).

Strengths

  • In 2008, the company operated 600 retail stores in 44 US states, Washington, D.C, and Canada. This includes 256 Williams-Sonoma, 198 Pottery Barn, 94 Pottery Barn Kids, 27 West Elm, nine Williams-Sonoma Home and 16 outlet stores.
    • They also sell their products through six websites: williams-sonoma.com, potterybarn.com, potterybarnkids.com, pbteen.com, westelm.com, and wshome.com. They also have seven successful mail-order catalogs.
    • Their extensive store network helps it cater to a varied consumer needs and segments and create product awareness and loyalty.
    • Online sales, improve their margins by cutting down its operating costs. The websites and catalogs create awareness about its products amongst customers. Multiple retail channels enable the company to enhance its reach, cater to a wider customer base and meet their diverse needs efficiently.

Whole Foods SWOT

SWOT Analysis Whole Foods

Company History

In 1980 twenty-five year old college dropout John Mackey and twenty-one year old Rene Lawson Hardy created the Whole Food Company (WFC) in Austin, Texas. It was born with the idea to provide a grocery store featuring good, wholesome food; not a "health food" store filled with pills and potions. Sales doubled each year for the first four years. This SWOT analysis is about Whole Foods.

  • They have an amazing website with blogs, recipes, sale items, tips, podcasts and more. The website is well designed and explains the Whole Foods concept very well.
  • They are supported by complementary industries such as: Health Industry, Health Insurance Companies, Health Care Specialists, Fitness Centers and Wellness Programs.
  • Whole Foods has a commitment to selling high quality natural and organic products, satisfying and delighting its customers, and caring about their communities and environment. These three factors, in large part, are why customers are attracted to the brand.
  • They have a hip image and attract younger, more affluent shoppers.
  • Their reputation for having the largest selection of organic, healthy, locally grown foods of any supermarket worldwide makes them attractive to customers.

Weaknesses

  • Right now the US government subsidizes (provides money to support) the corn growers industry, but not the organic farmer-therefore companies not utilizing organic ingredients can grow more food cheaper and faster.
  • The number of organic food farmers is growing, but slowly and the supply chain for organic foods is underdeveloped and cannot meet the needs of the American food system.
  • They are known as "whole paycheck" because some of the foods are higher priced than other grocery stores.

Opportunities

  • The commitment to high quality natural and organic foods leads to higher prices than non organic and natural foods. As the world is becoming more aware of how important it is to eat healthy, Whole Foods need to be there to pull those consumers in to the stores. Many consumers have the misconception that healthy foods are more expensive then other foods, when in fact they do provide a store brand that is comparable in price to other grocery chains. Whole Foods needs to change the attitudes of those consumers.
  • During a time when the economy is in a downturn, Whole Foods has to find a cost effective way to give a little something back to customers that do buy on a regular basis and try to get new customers in the same tactic. Making a free rewards card–after so much bought or points accumulated a customer can get a discount on the next purchase or get something free from the store.
  • They could sponsor more town events (not just in-store events) to increase recognition of the brand name and make customers more aware of the products they offer.
  • They need to promote and build brand identity with organic foods, eventually leading to the idea that when people think "organic" they will think "Whole Foods."

Threats

  • Whole Foods has increased competition from existing supermarkets that are re-branding in order to compete with them-Wal-Mart, HEB Central Market (Texas, Mexico) Wegman’s (New York), and Publix (Southern US). These stores have copied the atmospherics and some of the food items sold by Whole Foods.
  • The economic situation in the US is a threat due to Americans’ desire to save money and that means groceries. Food is expensive and Americans’ don’t see the cost effectiveness of purchasing organic food.
  • Any changes in government regulations on organic food would impact consumer spending even further.

What a ride. Back in 1980, we started out with one small store in Austin, Texas. Today, we’re the world’s leader in natural and organic foods, with more than 270 stores in North America and the United Kingdom. What a long, strange trip it’s been. We still honor our original ideals, and we think that has a lot to do with our success. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Strengths

  • Whole Foods Market (Whole Foods) owns and operates a chain of natural and organic foods supermarkets through several wholly-owned subsidiaries. The company’s supermarkets are located in the US, Canada, and the UK. It employs about 52,900 people.
  • In 1984, Whole Foods Market began its expansion out of Austin. While continuing to open new stores from the ground up, they fueled rapid growth by acquiring other natural foods chains throughout the 90’s: Wellspring Grocery of North Carolina, Bread & Circus of Massachusetts and Rhode Island, Mrs. Gooch’s Natural Foods Markets of Los Angeles, Bread of Life of Northern California, Fresh Fields Markets on the East Coast and in the Midwest, Florida Bread of Life stores, Detroit area Merchant of Vino stores, and Nature’s Heartland of Boston. In 2001, Whole Foods moved into Manhattan, generating a good deal of interest from the media and financial industries. 2002 saw an expansion into Canada and in 2004, Whole Foods Market entered the United Kingdom with the acquisition of seven Fresh & Wild stores.
  • The company recorded revenues of $7,953.9 million during the financial year (FY) ended September 2008, an increase of 20.7% over FY2007.
  • They have had 25 years of double digit revenue growth.
  • They are the undisputed $4.7B Organic Supermarket Industry Leader.
  • Originally, health food stores were small, expensive, and didn’t carry a large variety of products, Whole Foods changed all of this and they became the founding firm of this industry.
  • They offer catering , seasonal products and recipes, in-store events such as cooking classes, free tours around the store for customers with food allergies.

Walmart SWOT


SWOT Analysis Wal-Mart

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Strengths

  • Wal-Mart is a powerful retail brand. It has a reputation for value for money, convenience and a wide range of products all in one store.
  • Wal-Mart has grown substantially over recent years, and has experienced global expansion (for example its purchase of the United Kingdom based retailer ASDA).

Opportunities

  • To take over, merge with, or form strategic alliances with other global retailers, focusing on specific markets such as Europe or the Greater China Region.
  • The stores are currently only trade in a relatively small number of countries. Therefore there are tremendous opportunities for future business in expanding consumer markets, such as China and India.
  • New locations and store types offer Wal-Mart opportunities to exploit market development. They diversified from large super centres, to local and mall-based sites.
  • Opportunities exist for Wal-Mart to continue with its current strategy of large, super centres.

Threats

  • Being number one means that you are the target of competition, locally and globally.
  • Being a global retailer means that you are exposed to political problems in the countries that you operate in.
  • The cost of producing many consumer products tends to have fallen because of lower manufacturing costs. Manufacturing cost have fallen due to outsourcing to low-cost regions of the World. This has lead to price competition, resulting in price deflation in some ranges. Intense price competition is a threat.

‘Wal-Mart Stores, Inc. is the world’s largest retailer, with $256.3 billion in sales in the fiscal year ending Jan. 31, 2004. The company employs 1.6 million associates worldwide through more than 3,600 facilities in the United States and more than 1,570 units. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • The company has a core competence involving its use of information technology to support its international logistics system. For example, it can see how individual products are performing country-wide, store-by-store at a glance. IT also supports Wal-Mart’s efficient procurement.
  • A focused strategy is in place for human resource management and development. People are key to Wal-Mart’s business and it invests time and money in training people, and retaining a developing them.

Weaknesses

  • Wal-Mart is the World’s largest grocery retailer and control of its empire, despite its IT advantages, could leave it weak in some areas due to the huge span of control.
  • Since Wal-Mart sell products across many sectors (such as clothing, food, or stationary), it may not have the flexibility of some of its more focused competitors.
  • The company is global, but has has a presence in relatively few countries Worldwide.

Trojan SWOT

SWOT Analysis Trojan (Church and Dwight Company)

Company History

Trojan is owned by Church & Dwight Company, Incorporated, also known as, Arm & Hammer. The company is headquartered in Princeton, New Jersey and employed about 3,700 people as of December 2008. Church & Dwight Co., Inc., founded in 1846, is the leading U.S. producer of sodium bicarbonate, popularly known as baking soda. Would you like a lesson on SWOT analysis?

Weaknesses

  • The industry has high economies of scale and the capital investments are high while the variable costs are too low, making it a high volume, low cost business.
  • Establishing the brand image in countries that do not allow birth control products in advertisements can be a challenge.
  • Some consumers find the product unpleasant and may not use it.
  • Condoms are not 100% effective and can break.
  • Trojan cannot advertise on certain platforms and they are restricted to only advertising on TV late at night.
  • Trojan Condoms, are known worldwide, but are not the dominant condom used in most foreign countries.

Opportunities

  • They can aid the global community by increasing personal care product sales throughout Africa and reducing the spread of AIDS.
  • Expansion of product line and brands, expand into a non-profit segment.
  • Increasing use of condoms in India and South Korea, makes them attractive markets.
  • Products can be sold in multiple outlets: home delivery, online, hospitals, supermarkets, medical facilities, free clinics, hotels, club bathrooms.
  • Expanding sales to Amsterdam, where they are well known for a more laid back, open-minded lifestyle and sexual activity is accepted more than other countries and condoms are not the top selling form of birth control. It is an international market that only has one other brand of condom available. Prostitutes in the red light district are licensed and completely legal, which also means that prostitutes have access to medical care. Medical care is an important channel for sex education for the employees of the sex industry. The progressive style and thought process in Amsterdam could be a successful way of increasing Trojan condom purchasing and usage.

Threats

  • There may be religious, cultural and social restrictions among certain groups that object to utilizing birth control methods.
  • Trade restrictions, and the costs of obtaining certifications and establishing sales locations in some countries can be excessively high.
  • There are several substitutions for condoms, such as birth control pills, sterilization and IUD’s.
  • The education level and attitude of the consumer can lead them to avoid using the product, especially among high risk groups such as teenagers.

Church & Dwight Co., Inc., founded in 1846, is the leading U.S. producer of sodium bicarbonate, popularly known as baking soda, a natural product that cleans, deodorizes, leavens and buffers. The Company’s ARM & HAMMER brand is one of the nation’s most trusted trademarks for a broad range of consumer and specialty products developed from the base of bicarbonate and related technologies. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Church & Dwight’s consumer products business is organized into two segments: Consumer Domestic, which encompasses both household and personal care products, and Consumer International, which primarily consists of personal care products such as condoms and home pregnancy tests. This SWOT analysis is about Trojan.

Strengths

  • Trojan brand condoms are America’s #1 condom, and have been a recognized, trusted, global brand for over 90 years.
  • Trojan brand latex condoms are made from premium quality latex to help reduce the risk of unwanted pregnancy and sexually transmitted diseases.
  • They have over 30 varieties of condoms to suit the needs of every target consumer.
  • Each condom is electronically tested to help ensure reliability.
  • The company recorded revenues of $2,422.4 million during fiscal year (FY) ending December 2008, an increase of 9.1% over FY2007. The operating profit of the company was $340.3 million during FY2008, an increase of 11.6% over FY2007. The net profit was $195.2 million in FY2008, an increase of 15.5% over FY2007. In the first fiscal quarter of 2009 (April 2008-January 2009) sales increased by $11.2 million.
  • In 2008 Trojan had a 70% market share in the prophylactic industry world wide; no other company even comes close.
  • The increasing consumer awareness of risks of sex has led to an increase in the use of the product.
  • The product is relatively easy to obtain and inexpensive compared to other forms of birth control, such as birth control pills, which have to be obtained from a doctor and take an initial three months of continued use to work properly and then have to be taken on a regular basis, whereas the condom is used only when needed.
  • Channels of distribution have been created to have an effective line of communication with prospective buyers to ensure that the benefits of the product are being disseminated effectively. They provide literature on how to use the product properly and they provide the product for free to high risk groups at free clinics.

Toys R Us SWOT

SWOT Analysis Toys "R" Us

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Strengths.

  • Toys "R" Us has in excess of 1500 superstores in the United States and Worldwide. It also owns the baby brand, Babies R Us which adds another 200 + stores. Toys "R" Us also markets successfully on the Web (in collaboration with Amazon.com). It has a huge distribution network that benefits from advanced logistical systems. Having so much shelf space means that the company has a strong bargaining position when it comes to buying prices from manufacturers. It turned over more than $11 billion in 2005.

Threats.

  • There is strong competitive rivalry in the toy market, not only form Wal-Mart, but also from KB Toys and Target. The toy brand is often not associated with the retailer. So if a particular kid’s toy has grabbed the imagination and the spending power of its target consumer, any retail outlet is as good as another. Differentiation is difficult, and toy retailers often have to compete on price, range or availability.
  • Let’s face it today China and similar low cost manufacturing paradises are where toys are made. Low manufacturing costs are important if margins are to be retained. The problem, and potential weakness, is that countries and trading communities tend to impose quotas and tariffs in order to protect local manufacturing. All countries do it. However, Toy R Us could potentially be left without the toys people want to buy if embargoes are implemented on countries such as China.

In 1948, at the young age of 25, Charles Lazarus began a business totally dedicated to kids and their needs just in time for the post-war baby boom era. He had no idea that his first baby furniture store in Washington D.C., would evolve into an $11 billion dollar business with approximately 1,500 stores worldwide! Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • The company sells many different product ranges. There are benefits and disadvantages to this. However, a key strength is that the company has a diversified portfolio of products, which means that while some ranges are underperforming, others are out performing. As long as technology allows them to spot successes and then to focus upon them, they have a competitive strength.

Weaknesses.

  • These days, Toys “R” Us has no single and sustainable competitive advantage, other than brand. In the US, its traditional stronghold, the company has lost its number one positions as toy retailer to Wal-Mart. Being large may not be enough, when customers can go to another large retailer and buy the same and similar goods, sometimes getting a better deal.
  • As with all retailers in Western society, Toys “R” Us is heavily dependent upon successful sales during the final quarter of the year. They need to make profit from Christmas. Retail is notoriously seasonal and Toys “R” Us is no different to other retailers. In fact it could be argued that toys are a key Christmas present product, so are even more likely to be dependent upon seasonal sales.

Opportunities.

  • There are opportunities for joint ventures and strategic alliances. Toys "R" Us works closely with Amazon.com and its baby products category. This not only plays to the strengths of both companies, but also provides opportunities. Amazon is strong at the online part of the business, creating the web site, warehousing products and delivering them to customers. Toys "R" Us will use its buying power, but ultimately carries the inventory risk (i.e. if it doesn’t sell, its money is tied up in physical stock).
  • Toys "R" Us is a good neighbour. For example, in 2005 it went out of its way to help the Louisiana victims of hurricane Katrina. Toys "R" Us donated six trucks full of toys and baby supplies including diapers, wipes, and formula, as well as batteries and water to multiple locations that were housing evacuees. Babies "R" Us has also donated over 17 pallets of baby and children’s clothing to the national charity Kids In Distressed Situations (KIDS). Such associations will help to sustain its brand with key consumers.
  • As with many of the brands considered by MarektingTeacher.com’s FREE SWOT analyses, the International market is very important to Toys "R" Us. The citizens of emerging nations such as China and India are getting wealthier and better educated. Consumers have more disposable income and leisure time, and both of these could increase over coming years. The types of goods and services retailed by the company could be marketed more aggressively overseas. Toys "R" Us could look out for strategic partners, or indeed go it alone.

Toyota SWOT


SWOT Analysis Toyota

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Strengths.

  • New investment by Toyota in factories in the US and China saw 2005 profits rise, against the worldwide motor industry trend. Net profits rose 0.8% to 1.17 trillion yen ($11bn; £5.85bn), while sales were 7.3% higher at 18.55 trillion yen. Commentators argue that this is because the company has the right mix of products for the markets that it serves. This is an example of very focused segmentation, targeting and positioning in a number of countries.

Opportunities.

  • Lexus and Toyota now have a reputation for manufacturing environmentally friendly vehicles. Lexus has RX 400h hybrid, and Toyota has it Prius. Both are based upon advance technologies developed by the organization. Rocketing oil prices have seen sales of the new hybrid vehicles increase. Toyota has also sold on its technology to other motor manufacturers, for example Ford has bought into the technology for its new Explorer SUV Hybrid. Such moves can only firm up Toyota’s interest and investment in hybrid R&D.
  • Toyota is to target the ‘urban youth’ market. The company has launched its new Aygo, which is targeted at the streetwise youth market and captures (or attempts to) the nature of dance and DJ culture in a very competitive segment. The vehicle itself is a unique convertible, with models extending at their rear! The narrow segment is notorious for it narrow margins and difficulties for branding.

Threats.

  • Product recalls are always a problem for vehicle manufacturers. In 2005 the company had to recall 880,00 sports utility vehicles and pick up trucks due to faulty front suspension systems. Toyota did not g ive details of how much the recall would cost. The majority of affected vehicles were sold in the US, while the rest were sold in Japan, Europe and Australia.
  • As with any car manufacturer, Toyota faces tremendous competitive rivalry in the car market. Competition is increasing almost daily, with new entrants coming into the market from China, South Korea and new plants in Eastern Europe. The company is also exposed to any movement in the price of raw materials such as rubber, steel and fuel. The key economies in the Pacific, the US and Europe also experience slow downs. These economic factors are potential threats for Toyota.

Thanks to the dedication and hard work of indivduals who make up the Toyota family, Toyota has become the forth biggest automaker in North Amercia. Here you will find some of the many figures behind that fact. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • In 2003 Toyota knocked its rivals Ford into third spot, to become the World’s second largest carmaker with 6.78 million units. The company is still behind rivals General Motors with 8.59 million units in the same period. Its strong industry position is based upon a number of factors including a diversified product range, highly targeted marketing and a commitment to lean manufacturing and quality. The company makes a large range of vehicles for both private customers and commercial organizations, from the small Yaris to large trucks. The company uses marketing techniques to identify and satisfy customer needs. Its brand is a household name. The company also maximizes profit through efficient manufacturing approaches (e.g. Total Quality Management).

Weaknesses

  • Being big has its own problems. The World market for cars is in a condition of over supply and so car manufacturers need to make sure that it is their models that consumers want. Toyota markets most of its products in the US and in Japan. Therefore it is exposed to fluctuating economic and political conditions those markets. Perhaps that is why the company is beginning to shift its attentions to the emerging Chinese market. Movements in exchange rates could see the already narrow margins in the car market being reduced.
  • The company needs to keep producing cars in order to retain its operational efficiency. Car plants represent a huge investment in expensive fixed costs, as well as the high costs of training and retaining labour. So if the car market experiences a down turn, the company could see over capapacity. If on the other hand the car market experiences an upturn, then the company may miss out on potential sales due to under capacity i.e. it takes time to accommodate. This is a typical problem with high volume car manufacturing.

Time Warner SWOT

SWOT Analysis Time Warner

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Strengths

Dominant Market Share

Time Warner is not only a dominant US company it is one of the world’s largest media companies. Its pre-eminence in the US market is evident in the publication of 23 magazines, such as, Sports Illustrated, Time, InStyle, Real Simple, People, Fortune and Southern Living. The company also boasts nearly 50 websites internationally, such as People.com, SI.com and CNN Money.com.

Slumping AOL Revenues

Recent data show a downward trend in revenues for Time-Warner’s AOL division. In FY 2008 AOL reported a drop in revenues from $4,165 in 2006 to $7, 786 million in FY2008, representing a negative compounded annual growth rate (CAGR) of 27%. The decline is primarily due to the decrease in the number of domestic AOL brand subscribers and the sale of AOL’s German access business. Also, AOL revenues as a percentage of total revenues declined 17.8% during the same period. The declining performance of AOL may negatively impact the company’s overall revenue and profitability.

Opportunities

Joint Affiliations and Partnerships

The company has formed alliances with several leading companies in the media and entertainment industry. In October 2009, Warner Home Video (WHV) entered into a multi-year alliance with Sesame Workshop, a nonprofit educational organization. Under the terms of the agreement, WHV will exclusively distribute multiple Sesame Street titles, including the Sesame Street library.

In August 2009, Time-Warner and The Nielsen Company signed an agreement to provides Nielsen services to Time Warner’s broadcast, cable, syndication business units and affiliates, including Turner Broadcasting, The CW Television Network, HBO, Warner Brothers Domestic TV Distribution, Time Inc., RET Media and station WPCH. In addition, Time Warner and YouTube signed an online video distribution agreement, which allows Warner Bros. Entertainment and Turner Broadcasting System to program videos on YouTube using a Time Warner embeddable player.

MBC Group and Warner Bros. International Television Distribution (WBITD) signed a multiyear programming deal in April 2009. These are just some of the multiple partnerships which will enable the company to extend its reach and increase its subscriber base in the coming years.

Threats

Competitive Environment

Time Warner has formidable competition in each of its major business segments. The company’s AOL Division must face off against such firms as Google, Yahoo and Microsoft. In addition, MySpace, Facebook and Fox Interactive Media also compete with AOL for internet based revenues. Also, other traditional media firms have begun to offer their own internet services, among them are WPP Group (24/7 Real Media) and ValueClick. Broadband access providers also compete against AOL for internet subscribers.

Increasingly, Time Warner’s film entertainment business faces intense competition from new market entrees such as websites with internet streaming, user-generated content and interactive games. Alternative distribution systems such as cable and satellite provide competition for Turner Networks and Turner’s websites. With so many competitors in the industry there may be a scarcity of producers, directors, writers, actors and other skilled areas.

In recent years, competitors have launched new magazines and websites in the celebrity, women’s service and business sectors, these ventures compete directly with Time Warners’s People, InStyle, Real Simple, and Fortune magazines. Such intense competition as described above, could impact Time Warner pricing decisions and in turn effect revenues and market share.

Unauthorized Distribution of Content

Time Warner is increasingly impacted by the piracy of its television, motion pictures programming, DVD, and video games. Piracy is on the rise due to technological advances which allow thieves to create, transmit and distribute high quality unauthorized copies of content. This unauthorized distribution has the potential to reduce Time Warner’s revenues. Time Warner is also vulnerable to content theft in countries where it operates if those countries have weak laws protecting intellectual property or enforcement is lax.

Dependence on Google

Google is the main web search provider for nearly all of Time Warner’s AOL network and products. AOL has agreed to use Google’s algorithmic search and sponsored links on an exclusive basis through December 19, 2010. Failure to renew the agreement with Google will adversely affect the company’s operations. In addition any unilateral change Google may make in pricing, algorithms or advertising terms, could have a significant negative impact.

Time Warner Inc., a global leader in media and entertainment with businesses in television networks, filmed entertainment and publishing, uses its industry-leading operating scale and brands to create, package and deliver high-quality content worldwide through multiple distribution outlets. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Publishers Information Bureau rates Time Warner the largest magazine publisher in the US based upon advertising revenues received, while Nielsen Media Research and Media Metrix state that the company’s websites average over 29 million unique visitors monthly.

Time Warner’s AOL Web Content Services Division reached 75 million unique visitors in 2009 according to comScore Media Metrix data. AOL’s internet access subscription service is one of the largest in the US and Mapquest is one of the most prominent map and direction service in the US.

Consider also, Time Warner’s dominance of television programming. It distributes programming in more than 200 countries through its Warner Bros Television Group (WBTVG). In the US, Turner’s entertainment networks include TBS, with more than 90 million US households as in 2008; and TNT, with over 90 million households in the US.

Its presence even reaches into the contemporary cartoon genre such as the Cartoon Network (including Adult Swim, an overnight block of contemporary animation airing in 2008, which boasted approximately 97.7 million households in the US.

Time Warner is also prominent in the classic movie and cable television news areas. Its television news services, reached over 95 million US television households in 2008. Meanwhile, CNN operated 46 news bureaus and editorial operations, including 13 located in the US. In addition, Time Warner’s HBO is a pay television service (including its sister service, Cinemax), which collectively had approximately 40.9 million subscriptions as of FY2008.

Substantial Entertainment Programming

Time Warner produces and distributes theatrical motion pictures, television shows, animation and other programming such as videogames. In addition, the company distributes DVDs containing filmed entertainment produced or acquired by the company’s various content-producing subsidiaries and divisions, including Warner Bros. Pictures, Warner Bros. Television, New Line, Home Box Office and Turner Broadcasting System. LEGO Batman, Speed Racer and Guinness World Records, and co-published Lego Indiana Jones are among the interactive videogames produced by Time Warner through its subsidiaries.

Weaknesses

Substantial Dependence on the US Markets Although, the company has operations across South America, Europe, Asia Pacific and Middle East, the US is its primary market. Over 80% of its total revenues come from the US. The slumping US economy may negatively impact demand for the Time Warner ’s products and services.

Tata Motors SWOT

SWOT Analysis – Tata Motors Limited

The company began in 1945 and has produced more than 4 million vehicles. Tata Motors Limited is the largest car producer in India. It manufactures commercial and passenger vehicles, and employs in excess of 23,000 people. This SWOT analysis is about Tata Motors.

Opportunities

  • In the summer of 2008 Tata Motor’s announced that it had successfully purchased the Land Rover and Jaguar brands from Ford Motors for UK £2.3 million. Two of the World’s luxury car brand have been added to its portfolio of brands, and will undoubtedly off the company the chance to market vehicles in the luxury segments.
  • Tata Motors Limited acquired Daewoo Motor’s Commercial vehicle business in 2004 for around USD $16 million.
  • Nano is the cheapest car in the World – retailing at little more than a motorbike. Whilst the World is getting ready for greener alternatives to gas-guzzlers, is the Nano the answer in terms of concept or brand? Incidentally, the new Land Rover and Jaguar models will cost up to 85 times more than a standard Nano!
  • The new global track platform is about to be launched from its Korean (previously Daewoo) plant. Again, at a time when the World is looking for environmentally friendly transport alternatives, is now the right time to move into this segment? The answer to this question (and the one above) is that new and emerging industrial nations such as India, South Korea and China will have a thirst for low-cost passenger and commercial vehicles. These are the opportunities. However the company has put in place a very proactive Corporate Social Responsibility (CSR) committee to address potential strategies that will make is operations more sustainable.
  • The range of Super Milo fuel efficient buses are powered by super-efficient, eco-friendly engines. The bus has optional organic clutch with booster assist and better air intakes that will reduce fuel consumption by up to 10%.

Threats

  • Other competing car manufacturers have been in the passenger car business for 40, 50 or more years. Therefore Tata Motors Limited has to catch up in terms of quality and lean production.
  • Sustainability and environmentalism could mean extra costs for this low-cost producer. This could impact its underpinning competitive advantage. Obviously, as Tata globalises and buys into other brands this problem could be alleviated.
  • Since the company has focused upon the commercial and small vehicle segments, it has left itself open to competition from overseas companies for the emerging Indian luxury segments. For example ICICI bank and DaimlerChrysler have invested in a new Pune-based plant which will build 5000 new Mercedes-Benz per annum. Other players developing luxury cars targeted at the Indian market include Ford, Honda and Toyota. In fact the entire Indian market has become a target for other global competitors including Maruti Udyog, General Motors, Ford and others.
  • Rising prices in the global economy could pose a threat to Tata Motors Limited on a couple of fronts. The price of steel and aluminium is increasing putting pressure on the costs of production. Many of Tata’s products run on Diesel fuel which is becoming expensive globally and within its traditional home market.

Bibliography

Tata Motors’ Official Website
Wiki – Tata Motors Ltd
Business Today – Pick and Choose
Business Today – Tata Motors to bring Jaguar, Land Rover to India

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Strengths

  • The internationalisation strategy so far has been to keep local managers in new acquisitions, and to only transplant a couple of senior managers from India into the new market. The benefit is that Tata has been able to exchange expertise. For example after the Daewoo acquisition the Indian company leaned work discipline and how to get the final product ‘right first time.’
  • The company has a strategy in place for the next stage of its expansion. Not only is it focusing upon new products and acquisitions, but it also has a programme of intensive management development in place in order to establish its leaders for tomorrow.
  • The company has had a successful alliance with Italian mass producer Fiat since 2006. This has enhanced the product portfolio for Tata and Fiat in terms of production and knowledge exchange. For example, the Fiat Palio Style was launched by Tata in 2007, and the companies have an agreement to build a pick-up targeted at Central and South America.

Weaknesses

  • The company’s passenger car products are based upon 3rd and 4th generation platforms, which put Tata Motors Limited at a disadvantage with competing car manufacturers.
  • Despite buying the Jaguar and Land Rover brands (see opportunities below); Tata has not got a foothold in the luxury car segment in its domestic, Indian market. Is the brand associated with commercial vehicles and low-cost passenger cars to the extent that it has isolated itself from lucrative segments in a more aspiring India?
  • One weakness which is often not recognised is that in English the word ‘tat’ means rubbish. Would the brand sensitive British consumer ever buy into such a brand? Maybe not, but they would buy into Fiat, Jaguar and Land Rover (see opportunities and strengths).

Starbucks SWOT


SWOT Analysis Starbucks

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Strengths.

  • Starbucks Corporation is a very profitable organization, earning in excess of $600 million in 2004.The company generated revenue of more than $5000 million in the same year.
  • It is a global coffee brand built upon a reputation for fine products and services. It has almost 9000 cafes in almost 40 countries.

‘Starbucks’ mission statement is ‘Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.’ The following six guiding principles will help us measure the appropriateness of our decisions’ Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • Starbucks was one of the Fortune Top 100 Companies to Work For in 2005. The company is a respected employer that values its workforce.
  • The organization has strong ethical values and an ethical mission statement as follows, ‘Starbucks is committed to a role of environmental leadership in all facets of our business.’

Weaknesses.

  • Starbucks has a reputation for new product development and creativity. However, they remain vulnerable to the possibility that their innovation may falter over time.
  • The organization has a strong presence in the United States of America with more than three quarters of their cafes located in the home market. It is often argued that they need to look for a portfolio of countries, in order to spread business risk.
  • The organization is dependant on a main competitive advantage, the retail of coffee. This could make them slow to diversify into other sectors should the need arise.

Opportunities.

  • Starbucks are very good at taking advantage of opportunties. In 2004 the company created a CD-burning service in their Santa Monica (California USA) cafe with Hewlett Packard, where customers create their own music CD.
  • New products and services that can be retailed in their cafes, such as Fair Trade products.
  • The company has the opportunity to expand its global operations. New markets for coffee such as India and the Pacific Rim nations are beginning to emerge.
  • Co-branding with other manufacturers of food and drink, and brand franchising to manufacturers of other goods and services both have potential.

Threats.

  • Who knows if the market for coffee will grow and stay in favour with customers, or whether another type of beverage or leisure activity will replace coffee in the future?
  • Starbucks are exposed to rises in the cost of coffee and dairy products.
  • Since its conception in Pike Place Market, Seattle in 1971, Starbucks’ success has lead to the market entry of many competitors and copy cat brands that pose potential threats.

Sony SWOT

Sony SWOT

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Strengths

Substantial Brand Identity

Sony is a corporate brand whose identity is deeply rooted and very well established in the minds of potential customers. The brand remains healthy despite dropping from 25th to 29 in name recognition according to InterBrands 2009 ranking. Interbrand valued Sony brand at $11 million.

Projected Growth in the Consumer Electronics Market

The Consumer Electronics Market is expected to grow at a rate of 7.2% annually to reach a value of $136,700 million in 2014. Sony is uniquely positioned to take advantage of this increase. As one of the largest global companies in the industry Sony has the capacity to tap into changes in consumer demands as they emerge. Sony’s recent reorganization has put digitally savvy and globally experienced staff in positions to maximize the potential seen in growth projections.

Strong Positioning in Emerging Economies

Sony is firmly entrenched in the so-called BRIC economies (Brazil, Russia, India and China). These regions are emerging markets and represent over 40% of the worlds’ population. The firm plans on following its model of success experienced in India where it emphasized its television film, and music product content. The company has a goal of doubling its revenues in the BRIC markets.

Threats

The Continued Economic Slump

The negative economic conditions in The United States, Japan and Europe have had a disastrous impact on Sony. The company receives approximately 74% of its revenues from these markets. As the economic slump lingers, consumer confidence remains low and Sony has felt the impact in decreased revenues. Sony leadership has acknowledged that the downturn exposed weaknesses and vulnerabilities in the firm that have needed addressing for some time.

Impact of Strong Japanese Yen

Sony is vulnerable to fluctuations in foreign currency exchange rates and exposed to fluctuations in the value of the Japanese yen, the US dollar and the Euro. Recently, the Japanese Yen appreciated significantly against the US dollar and Euro. A stronger yen makes Sony’s products appear expensive in comparison and cuts into the value of overseas earnings. The firm acknowledges the need to implements effective hedging strategies to counter foreign exchange translation effects.

The Impact of the Black Market

Smuggled goods and counterfeit products have really plagued the electronics manufacturing industry in recent times. Counterfeit goods are projected to double to 18% of total world trade by 2010. In addition, China’s growing share of electronics production represents an increase in the number of potential counterfeit products in the market. These knockoffs, although cheaper and of less quality still the potential to divert revenues from Sony.

The Impact of Compliance Regulations

Environmental, health and safety compliance laws which impact Sony operations and production may be burdensome and have a negative impact on profits. To maintain compliance the firm must incur capital and other expenditures. Potential expenditures related to regulations are not limited to compliance, but may also be felt in fines and penalties in the wake of non-compliance.

The Origins of the SONY Brand

The Sony name was created by combining “SONUS,” the original Latin for “SONIC,” meaning sound, with “SONNY,” denoting small size, or a youthful boy. It was chosen for its simple pronunciation that is the same in any language. More . . .

Global Diversification

Sony products and services are available throughout the world in approximately 200 countries and territories. The United States market accounted for 17.9% of the revenues, Europe (13.9%), and others (25.8%), while Japan consisted of the largest segment at 42%. This diversification helps to minimize the impact of adverse conditions that may arise in any one geographic region.

Weaknesses

Downward Trending Revenues

Four major Sony division experienced revenue losses in 2009, specifically Electronics down 17%, Games down 18%, Pictures down 16.4% and Financial Services down 7.4%.In the U.S Revenues were down 15.4 %, while revenues in Japan fell 15.2%.

Poor Proximity of Production to Customers

Sony’s production facilities are located far from its customer base. Approximately 60% of the annual production in Japan must be distributed to for other regions. In FY2009, the group produced 50% of the electronics segment’s total annual production in Japan.

Substantial Retirement Benefit Commitments

The unfunded status of the pension liabilities (approximately $3.6 billion) increased at a rate of 62% over 2008. Sizeable unfunded post retirement benefits would force the company to make periodic cash contributions, diverting money away from production related uses.

Opportunities

Joint Ventures and Strategic Acquisitions

Sony benefits from the flexibility to enter into key join ventures and execute key corporate acquisitions. For example, established a joint venture project with Sharp to produce and sell large-sized LCD panels and modules. Another example includes its alliance with Taiwan’s Hon Hai Precision Industry for the production of LCD TVs. Among recent acquisitions are the purchase of a TFT liquid crystal display (LCD) business from Epson Imaging Devices and Convergent Media Systems, which makes video integration solutions for the enterprise market.

Smith and Wesson SWOT

SWOT Analysis Smith and Wesson

Company History

Smith & Wesson Holding Corporation, a global leader in safety, security, protection and sport, is parent company to Smith & Wesson Corp., one of the world’s largest manufacturers of quality firearms and firearm safety/security products and parent company to Smith & Wesson is based in Springfield, Massachusetts with manufacturing facilities in Springfield, Houlton, Maine, and Rochester, New Hampshire. This SWOT analysis is about Smith and Wesson.

Weaknesses

  • Only 7% of their sales are produced from international venues. A vast majority of their sales are in the United States market, and while they are an international company, their sales and market share in foreign markets are low.
  • They do not dominate the hunting enthusiast market.
  • From 2004 to 2009, sales of revolvers dropped from about 40% of the company’s sales to around 20%.

Opportunities

  • To diversify and add breadth to its brand, the firm licenses its name to makers of apparel, watches, sunglasses, gift sets, and more.
  • The creation of law enforcement products that do not injure public offenders; such as guns that shoot "bean bags" or "large pellets."
  • Technological advancements for this company are always leading to more opportunities-for instance they could create a gun that has fingerprint recognition capabilities and can only be fired by whoever programmed the gun.
  • Expanding its products in the areas of tactical and long-gun lines, as well as non-firearm products and services.

Threats

  • Their major competitors are Browning Arms, Glock and Ruger.
  • Sales of firearms in the United States are based on laws passed by the government giving citizens the right to carry weapons; however, this is a hotly debated issue and could change.
  • Expanding into foreign markets is challenging due to political and legal laws prohibiting the sale and use of weapons. In some countries only law enforcement is allowed to carry weapons.

Smith & Wesson is one of the world’s most recognizable brands, and for good reason. Since we first opened our doors, we have focused on designing and manufacturing innovative solutions that are unparalleled in the field of personal safety and protection. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Horace Smith and Daniel B. Wesson formed their partnership in 1852 in Norwich, Connecticut, with the aim of marketing a lever action repeating pistol that could use a fully self-contained cartridge. They went bankrupt and began again in 1856, when Smith & Wesson produced a small revolver designed to fire the Rimfire cartridge they patented in August of 1854. This revolver was the first successful fully self-contained cartridge revolver available in the world. Smith & Wesson secured patents for the revolver to prevent other manufacturers from producing a cartridge revolver – giving the young company a very lucrative business and established Smith & Wesson as a world leader in handgun manufacturing.

Strengths

  • Thompson/Center Arms, Inc., a premier designer and manufacturer of premium hunting rifles, black powder rifles, interchangeable firearms systems and accessories under the Thompson/Center brand. Smith & Wesson licenses shooter eye and ear protection, knives, apparel, and other accessory lines.
  • Smith & Wesson is the largest manufacturer of handguns in the United States and one of the most recognizable brands in the world. They manufacture and distribute a full line of firearms for defense, law enforcement, hunting and sporting.
  • They provide products that are utilized by virtually every police agency and military force around the world and The Smith & Wesson Academy is America’s longest running firearms training facility for law enforcement, military and security professionals. Law enforcement personnel from every state and over 50 foreign countries have come to the Springfield, Massachusetts facility to receive state-of-the-art instruction, to prepare for and exceed the demanding needs of law enforcement. The academy’s superior training gives today’s police force the tools necessary to handle tomorrow’s most extreme situations.
  • They are a company dedicated to research and development and have produced the first American made double action auto-loading pistol, stainless steel firearms and perimeter security systems and have driven product development for more than 150 years.
  • In 2009 they won the first ever ASIS Accolades Award for the Expeditionary Mobile Barrier (EMB) in the category of Most Transformational Product or Service. The EMB is a completely mobile barrier that can stop a 7,500-pound vehicle traveling 45 miles-per-hour. This product increases the likelihood that vehicle occupants will be unharmed. It is immediately resettable after impact, with few or no replaced parts. An adjustable net allows the system to secure a variety of roadway widths without requiring additional parts.
  • Smith and Wesson’s Universal Safety Response (USR) serves a variety of clients in the defense, transportation and petrol-chemical industries, as well as corporate facilities, airports, Fortune 500 companies, national laboratories and museums. USR’s security systems are also used by the US Homeland Security and to safeguard high-risk facilities.
  • They are a leading advocate of the development and use of firearms safety devices, incorporated multiple safety features into each of their handguns, maintained the country’s longest-running shooters training facility, promoted the NSSF "Child Safe" gun lock program nationwide, and they currently license numerous safety devices to the shooting sports market.
  • Despite the economic recession in the Unites States, sales grew 13.2% in 2008.
  • They have a 70% market share in the handgun segment of the firearms industry in the United States.

Sandals SWOT

SWOT Analysis Sandals

Company History

Sandals (Beaches) is a Caribbean Based Resort Hotel Chain, that was only recently established, but has proved to be highly successful, based on their innovative marketing concepts. This SWOT analysis is about Sandals.

Winner of thousands of awards, including:

  • Six time winner of the Gold Travel Life Award by Virgin Holidays.
  • Nine time winner of the Baxter Travel Media award for Favorite Resort.
  • 2008 Thomas Cook Award for Best Hotel Chain, and Best Wedding and Honeymoon Hotel.
  • TripAdvisor awarded them the 2007 and 2008 World’s Most Romantic All-Inclusive Resort.
  • Travel + Leisure Magazine awarded them one of the top 25 hotels in the Caribbean for 2002, 2006 and 2008.
  • Condé Nast Magazine Readers Choice Poll awarded them one of the top 25 Caribbean Resorts for 2006, 2007; and the top 15 Caribbean Resorts and Spas for 2000, 2004 and 2005.
  • They have made the Condé Nast Magazine Gold List every year from 2000-2007.
  • In 2007, they were given a World Savers Award by Condé Nast Magazine for their Adopt-A-School program.
  • In 2006 they won second place in the Caribbean Travel and Life Magazine Reader’s Choice poll for Best All-Inclusive Resort.
  • In 2005 Modern Bride Magazine voted them the Favorite All-Inclusive Resort and in 2008 the Best All-Inclusive Resort chain.
  • American Express gave them the Caribbean Environmental Award for Green Hotel of the year, 2003, 2004, 2006 and 2007.
  • They earned the Travel Weekly Magellan Award for Overall Eco-Friendly Resort in 2008.
  • They were voted Travel Weekly America and UK Readers Choice for Best All-Inclusive Resort, six years in a row.
  • TravelAge Editor’s Pick Award for Best Caribbean Resort in 2006, 2007 and 2008.
  • World Travel Magazine award for Caribbean’s Leading Resort Hotel Brand winner 14 years in a row; Best All-Inclusive Company winner 12 years in a row, World’s Most Romantic Resort winner 11 years in a row.
  • 2006 British Airways Best Independent Hotel Group.
  • 2007 British Travel Awards for Best All-Inclusive Resort-13th year in a row-and the Consumer Favorite All-Inclusive Resort.
  • Porthole Cruise Magazine Editor-in-Chief Award for Best All-Inclusive Resort, 2005-2007.
  • Selling Long-Haul UK Travel Award for Best All-Inclusive Resort, and Best Hotel in the Caribbean in 2003.

Sandals and Beaches resorts offer an innovative concept in their all-inclusive environments, contrived to give vacationers completely worry-free accommodations. Guests do not have to pay for food, activities, babysitting, or entertainment while at their resorts. This allows guests to relax and more effectively utilize their vacation time.

They employ guest coordinators, trained to be experts in human relations, to make guests feel at home, coordinating the guest activities and making sure that everything works the way it should. They practice TQM throughout all levels of staff.

In the couples only market (that they created) they cater to different markets by offering three different levels of suites: the basic all-inclusive suites, the crystal suites that have their own private pool and the millionaire suites that are separate villas with butler service.

Weaknesses

They need to communicate the resort’s view on environmental issues. For instance, Sandal’s beach resort received a Green Globe Certification for commitment to natural resources, but they don’t advertise or communicate it! In this economic downturn, Americans want to feel good about spending their money in socially responsible ways and the Green Globe Certification is highly prestigious.

They spent a huge amount of capital setting up a new resort in Barbados, only to have it sit there, unoccupied. The government of Barbados does not allow their beaches to be blocked off with fences, and Sandals requires that their guests be kept separate from other people to prevent crime and interlopers. They have been at odds about this issue since 2001 and their fully completed resort there has yet to see its first guest.

As with all tourist destinations, they are dependent on a healthy economy in countries whose citizens have more discretionary income to spend, and vacation regularly. The American trend toward "staycations" will cause their revenue to decrease.

They need to better position themselves against competition, other luxury resorts, Breezes All-Inclusive Resorts and other popular destinations for honeymoons and families.

Opportunities

Opening new resorts in Belize, or Hawaii, and some non beach areas such as Alaska and Colorado; they could also open resorts in other International settings such as China, Japan, Taiwan, France, Spain, Italy, Greece, Australia, Mexico and Brazil.

Promote their resorts at all Bridal and Child/Baby Expos in major cities, in order to reach the largest numbers of their target market. They can make use of high definition, interactive sales pitches that will allow honeymooners and families to book their vacations on the spot. Attending the National Wedding Show in London every February.

Creating a joint venture with David’s Bridal, creating a presence on all of the major wedding planning websites, Parents’ Magazine and on Nickelodeon.

During the economic downturn, they need to play up the "all-inclusive" angle of their resorts: creating a marketing campaign that emphasizes the money saving aspects of their vacation destinations, and the fact that guests don’t need to worry about extra expenses.

July 2009 Sandals announced that they will partner up with Martha Stewart to Launch Martha Stewart Weddings Program in the Caribbean beginning in 2010. Guests will be able to book a Martha Stewart Wedding at any of the 12 Sandals Resorts or four Beaches Family Resorts. In addition, they will introduce Martha Stewart Crafts classes for adults at Sandals Resorts and craft camps for families at Beaches Resorts in 2010. The Futures Company (formerly Yankelovich), said that destination weddings are on the upswing with 31% of brides ages 21-30 planning to have a destination wedding; previous studies indicated that destination weddings represented 10% to 20% of all weddings.

Threats

One threat that cannot be controlled is the weather. Hurricanes are bad for business all over the Caribbean; however, they can offer guarantees so their guests will feel more secure when booking a vacation.

There are several ethical arenas that need to be understood when dealing with the tourism industry. If any of these becomes a problem or causes bad PR it can affect the company and eventually their profit margin.

  • Crime rates typically increase with the growth and urbanization of an area and growth of mass tourism is often accompanied by increased crime. The presence of a large number of tourists with a lot of money to spend, and often carrying valuables such as cameras and jewelry, increases the attraction for criminals and brings with it activities like robbery and drug dealing.
  • Tourism can also drive the development of gambling, which may cause negative changes in social behavior.
  • Many jobs in the tourism sector have working and employment conditions that leave much to be desired: long hours, unstable employment, low pay, little training and poor chances for qualification. In addition, recent developments in the travel and tourism trade (liberalization, competition, concentration, drop in travel fares, growth of subcontracting) and introduction of new technologies seem to reinforce the trend towards more precarious, flexible employment conditions. For many such jobs young children are recruited, as they are cheap and flexible employees.
  • The commercial sexual exploitation of children and young women has paralleled the growth of tourism in many parts of the world. Though tourism is not the cause of sexual exploitation, it provides easy access to it. Tourism also brings consumerism to many parts of the world previously denied access to luxury commodities and services. The lure of this easy money has caused many young people, including children, to trade their bodies in exchange for T-shirts, personal stereos, bikes and even air tickets out of the country.

References

Akrofi, J. 2006, Recreation and Tourism: Impacts of Tourism: Socio cultural aspects: Ethical Issues, retrieved on March 2, 2008.

Anonymous. (Jul 27, 2009). Martha Stewart Living Omnimedia and Sandals Resorts to Launch Martha Stewart Weddings Program in the Caribbean; Martha Stewart Weddings at Sandals Resorts Available Beginning January 1, 2010; Martha Stewart Crafts Programs to Launch in 2010. PR Newswire. New York.

Sandals Resorts.. Retrieved on March 2, 2008

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

In Montego Bay, Jamaica, in 1981, Gordon "Butch" Stewart, took notice of an old hotel sitting on Jamaica’s largest private white sand beach, bought it, fixed it up and opened the hotel doors for business. With no prior experience, the investor envisioned a marketing plan for the resort to cater to couples only. Sandals Montego Bay became the first all-inclusive vacation concept, and by year-end of 1988, Sandals refined and perfected concepts, such as, swim-up pool bars, royal treatment with private beaches, breakfast in bed, and beachfront gourmet meals.

In 2004, the resort hit great heights with the creation of the company’s ultimate all-inclusive butler service. With thriving expansions, Sandals currently holds locations in Jamaica, St. Lucia, Antigua, and the Bahamas, totaling 12 resorts. A long way from one, run down hotel on a private sandy beach! Today, the resort offers luxury package vacations, fine dining, night entertainment, scuba diving and water sports, golf and land sports, spas, and wedding packages.

Sandals’ is committed to the resort’s mission of ".attaching a premium to human resources and being among the most environmentally responsible and community friendly groups in the hospitality industry" (Sandals Resorts, 2007). Sandals resorts continue to penetrate the market with their couples’ only concept, and have expanded this concept with accommodations for families through other beach resorts, branded Beaches.

Strengths

They created the idea of a couples only resort by introducing the Sandals resort; they also opened Beaches, a family luxury resort; Royal Plantation, three exclusive luxury oriented resorts with butler service and private airplanes; and the Grand Pineapple, a value resort for families.

All Sandals resorts are Green Globe Certified; it means that the staff is continually trained by local government run environmental organizations, they monitor and conserve all water use on property, they use times on all electrical equipment such as; Jacuzzi blowers, steam rooms at the Spa, outdoor lighting for walkways, refrigeration equipment in the kitchens, etc., recycling food, and office paper, reducing the use of all hazardous chemicals and Inviting local craft vendors to the hotel at least once per week to display and sell their craft items.

Pepsi SWOT


SWOT Analysis PepsiCo

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Strengths

  • Branding – One of PepsiCo’s top brands is of course Pepsi, one of the most recognized brands of the world, ranked according to Interbrand. As of 2008 it ranked 26th amongst top 100 global brands. Pepsi generates more than $15,000 million of annual sales. Pepsi is joined in broad recognition by such PepsiCo brands as Diet Pepsi, Gatorade Mountain Dew, Thirst Quencher, Lay’s Potato Chips, Lipton Teas (PepsiCo/Unilever Partnership), Tropicana Beverages, Fritos Corn, Tostitos Tortilla Chips, Doritos Tortilla Chips, Aquafina Bottled Water, Cheetos Cheese Flavored Snacks, Quaker Foods and Snacks, Ruffles Potato Chips, Mirinda, Tostitos Tortilla Chips, and Sierra Mist.

Opportunities

  • Broadening of Product Base – PepsiCo is seeking to address one of its potential weaknesses; dependency on US markets by acquiring Russia’s leading Juice Company, Lebedyansky, and V Wwater in the United Kingdom. It continues to broaden its product base by introducing TrueNorth Nut Snacks and increasing its Lipton Tea venture with Unilever. These recent initiatives will enable PepsiCo to adjust to the changing lifestyles of its consumers.

  • International Expansion – PepsiCo is in the midst of making a $1, 000 million investment in China, and a $500 million investment in India. Both initiatives are part of its expansion into international markets and a lessening of its dependence on US sales. In addition the company plans on major capital initiatives in Brazil and Mexico.

  • Growing Savory Snack and Bottled Water market in US – PepsiCo is positioned well to capitalize on the growing bottle water market which is projected to be worth over $24 million by 2012. Products such as Aquafina, and Propel are well established products and in a position to ride the upward crest.PepsiCo products such as, Doritos tortilla chips, Cheetos cheese flavored snacks, Tostitos tortilla chips, Fritos corn chips, Ruffles potato chips, Sun Chips multigrain snacks, Rold Gold pretzels, Santitas are also benefiting from a growing savory snack market which is projected to grow as much as 27% by 2013, representing an increase of $28 million.

Threats

  • Decline in Carbonated Drink Sales – Soft drink sales are projected to decline by as much as 2.7% by 2012, down $ 63,459 million in value. PepsiCo is in the process of diversification, but is likely to feel the impact of the projected decline.

  • Potential Negative Impact of Government Regulations – It is anticipated that government initiatives related to environmental, health and safety may have the potential to negatively impact PepsiCo. For example, manufacturing, marketing, and distribution of food products may be altered as a result of state, federal or local dictates. Preliminary studies on acrylamide seem to suggest that it may cause cancer in laboratory animals when consumed in significant amounts. If the company has to comply with a related regulation and add warning labels or place warnings in certain locations where its products are sold, a negative impact may result for PepsiCo.

  • Intense Competition – The Coca-Cola Company is PepsiCo’s primary competitors. But others include Nestlé, Groupe Danone and Kraft Foods. Intense competition may influence pricing, advertising, sales promotion initiatives undertaken by PepsiCo. Resently Coca-Cola passed PepsiCo in Juice sales.

  • Potential Disruption Due to Labor Unrest – Based upon recent history, PepsiCo may be vulnerable to strikes and other labor disputes. In 2008 a strike in India shut down production for nearly an entire month. This disrupted both manufacturing and distribution.

PepsiCo is a world leader in convenient snacks, foods and beverages with revenues of more than $43 billion and over 198,000 employees. Take a journey through our past and see the key milestones that define PepsiCo. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • The strength of these brands is evident in PepsiCo’s presence in over 200 countries. The company has the largest market share in the US beverage at 39%, and snack food market at 25%. Such brand dominance insures loyalty and repetitive sales which contributes to over $15 million in annual sales for the company
  • Diversification – PepsiCo’s diversification is obvious in that the fact that each of its top 18 brands generates annual sales of over $1,000 million. PepsiCo’s arsenal also includes ready-to-drink teas, juice drinks, bottled water, as well as breakfast cereals, cakes and cake mixes.This broad product base plus a multi-channel distribution system serve to help insulate PepsiCo from shifting business climates.

  • Distribution – The company delivers its products directly from manufacturing plants and warehouses to customer warehouses and retail stores. This is part of a three pronged approach which also includes employees making direct store deliveries of snacks and beverages and the use of third party distribution services.

Weaknesses

  • Overdependence on Wal-Mart – Sales to Wal-Mart represent approximately 12% of PepsiCo’s total net revenue. Wal-Mart is PepsiCo’s largest customer. As a result PepsiCo’s fortunes are influenced by the business strategy of Wal-Mart specifically its emphasis on private-label sales which produce a higher profit margin than national brands. Wal-Mart’s low price themes put pressure on PepsiCo to hold down prices.

  • Overdependence on US Markets – Despite its international presence, 52% of its revenues originate in the US. This concentration does leave PepsiCo somewhat vulnerable to the impact of changing economic conditions, and labor strikes. Large US customers could exploit PepsiCo’s lack of bargaining power and negatively impact its revenues.

  • Low Productivity – In 2008 PepsiCo had approximately 198,000 employees. Its revenue per employee was $219,439, which was lower that its competitors. This may indicate comparatively low productivity on the part of PepsiCo employees.

  • Image Damage Due to Product Recall – Recently (2008) salmonella contamination forced PepsiCo to pull Aunt Jemima pancake and waffle mix from retail shelves. This followed incidents of exploding Diet Pepsi cans in 2007. Such occurrences damage company image and reduce consumer confidence in PepsiCo products.

Nintendo SWOT

SWOT Analysis Nintendo

Nintendo started back in 1889. Would you believe that the business started by making playing cards? Through the years, the company progressed into the manufacture of toys and games and then ultimately to the manufacture and What is marketing? of electronic games. Early popular products included Nintendo 64, and Game Boy which was introduced in Japan in 2001. Popular current products include Wii fit and derivatives of the DS portable video game player. Would you like a lesson on SWOT analysis?

Weaknesses

As you might have noticed by reading other SWOT analyses on the marketing teacher website, such a large supplier and manufacturer is largely dependent on its own supply chain. So if suppliers are overseas then it is more difficult to manage the supply chain, and the business is exposed to currency fluctuations and the economic climates in other parts of the world. The lack of a single key component for whatever reason would be a problem for Nintendo.

Margins are very tight in the gaming industry. You might have heard rumours that the Sony PlayStation 3 is manufactured and sold at a loss. Console and games manufacturers need to make sure that it is their device that is in the home of the consumer.

There are many rumours that Nintendo’s margin per unit is low and that this may cause them some Marketing and Finance difficulty.

Opportunities

The main opportunity to games manufacturers lies in the opening of many new small and large segments. Players are getting older and younger. For example, the average age of gamers in the United States is now over 35 years old. As already mentioned, the Nintendo Wii gives the business access to many generations of gamers, regardless of class, culture and income. The gaming industry now churns far more cash than the movie industry, and this is set to continue.

Gaming today happens online. Did you know that more than 500 million homes will soon have access to broadband Internet? That’s 500 million gamers ready to buy Nintendo products, potentially. So products, which are Wi-Fi and Internet enabled are going to be popular. Nintendo is in this space, and has a competitively positioned offering.

Threats

Who knows where the entertainment industry will go next? If there can be a migration from TV and movies to online gaming, there could also be a new and emerging technology in the future. Also who knows whether consumers will swap from Sony PlayStation, to Xbox, to Nintendo and so on? So consumer choices in the future might change. Nothing is ever certain in business.

The cell phone market saw that consumers wanted new products every year. Now some consumers change their mobile phone at very regular intervals. This would be an example of very sharp and short customer life-cycles. The same will be the case for the gaming industry, with consumers changing their preferences and games changing in popularity, more and more quickly. As soon as one product is in the market , its replacement is off the drawing board being prepared for the shops.

As with all of the global businesses discussed on this website, Nintendo will be exposed to changes in currency values and the global economic climate at that time.

Competitors will be Nintendo’s biggest threat. Sony and Microsoft have their own particular competitive advantages which Nintendo will need to offset. These three key players will fight it out over the next few years, although there may be new entrants from China or India as their economies become more consumerist.

Strengths

One of the businesses main strengths is the fact that it is truly global has a geographical presence in most corners of the world. Manufacturing is still primarily undertaking in Japan, although distribution networks exist worldwide. A global business means that the company is not over-reliant on specific markets and therefore its business risk is reduced.

The Nintendo brand and logo is adopted worldwide as a major electronic gaming brand. Just think how far the business has progressed from the Nintendo 64 to the GameCube to the Nintendo DS and finally to the Wii. They have worked themselves into new and interesting segments. For example, the Nintendo DS is ideal for travel as well as a handy device to keep children entertained. The Wii is a family entertainment device and also has niches for keep fit and sports. Ultimately, the devices have become well-known household names.

Nike SWOT


SWOT Analysis Nike, Inc.

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Strengths.

  • Nike is a very competitive organization. Phil Knight (Founder and CEO) is often quoted as saying that ‘Business is war without bullets.’ Nike has a healthy dislike of is competitors. At the Atlanta Olympics, Reebok went to the expense of sponsoring the games. Nike did not. However Nike sponsored the top athletes and gained valuable coverage.

Threats.

  • Nike is exposed to the international nature of trade. It buys and sells in different currencies and so costs and margins are not stable over long periods of time. Such an exposure could mean that Nike may be manufacturing and/or selling at a loss. This is an issue that faces all global brands.
  • The market for sports shoes and garments is very competitive. The model developed by Phil Knight in his Stamford Business School days (high value branded product manufactured at a low cost) is now commonly used and to an extent is no longer a basis for sustainable competitive advantage. Competitors are developing alternative brands to take away Nike’s market share.
  • As discussed above in weaknesses, the retail sector is becoming price competitive. This ultimately means that consumers are shopping around for a better deal. So if one store charges a price for a pair of sports shoes, the consumer could go to the store along the street to compare prices for the exactly the same item, and buy the cheaper of the two. Such consumer price sensitivity is a potential external threat to Nike.

‘If you have a body, you are an athlete’ – Bill Bowerman said this a couple of decades ago. The guy was right. It defines how he viewed the world, and it defines how Nike pursues its destiny. Ours is a language of sports, a universally understood lexicon of passion and competition. A lot has happened at Nike in the 30 years. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • Nike has no factories. It does not tie up cash in buildings and manufacturing workers. This makes a very lean organization. Nike is strong at research and development, as is evidenced by its evolving and innovative product range. They then manufacture wherever they can produce high quality product at the lowest possible price. If prices rise, and products can be made more cheaply elsewhere (to the same or better specification), Nike will move production.
  • Nike is a global brand. It is the number one sports brand in the World. Its famous ‘Swoosh’ is instantly recognisable, and Phil Knight even has it tattooed on his ankle.

Weaknesses.

  • The organization does have a diversified range of sports products. However, the income of the business is still heavily dependent upon its share of the footwear market. This may leave it vulnerable if for any reason its market share erodes.
  • The retail sector is very price sensitive. Nike does have its own retailer in Nike Town. However, most of its income is derived from selling into retailers. Retailers tend to offer a very similar experience to the consumer. Can you tell one sports retailer from another? So margins tend to get squeezed as retailers try to pass some of the low price competition pressure onto Nike.

Opportunities.

  • Product development offers Nike many opportunities. The brand is fiercely defended by its owners whom truly believe that Nike is not a fashion brand. However, like it or not, consumers that wear Nike product do not always buy it to participate in sport. Some would argue that in youth culture especially, Nike is a fashion brand. This creates its own opportunities, since product could become unfashionable before it wears out i.e. consumers need to replace shoes.
  • There is also the opportunity to develop products such as sport wear, sunglasses and jewellery. Such high value items do tend to have associated with them, high profits.
  • The business could also be developed internationally, building upon its strong global brand recognition. There are many markets that have the disposable income to spend on high value sports goods. For example, emerging markets such as China and India have a new richer generation of consumers. There are also global marketing events that can be utilised to support the brand such as the World Cup (soccer) and The Olympics.

Nestle SWOT

SWOT Analysis Nestlé

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Strengths

  • Global food producer, located in over 100 countries. Consistently one of the world’s largest producers of food products, with sales in the USA in 2008 of $10 billion; sales and earnings in 2008 were better than expected, even in a downturned economy. Global sales in 2008 topped $101 billion.

Weaknesses

  • Their LC-1 division was not as successful as they thought it would be in France. In the late 1980s, Dannon entered the market with a health-based yogurt, and become the top selling brand of yogurt; Nestlé’s 1994 launch was behind the product life cycle curve in an already mature market and could not compete against a strong, established brand.
  • Growth in their organic food sales division was flat in 2008, even though the industry grew 8.9%.
  • Since 2004 the breakfast cereal industry has been under fire from the FDA and the American Medical Association, both of which say that false claims of “heart healthy” and “lower cholesterol” need to be removed from packaging and advertising. They have also been forced to reduce the amount of sugar in their products, as parent’s advocates groups claimed they were contributing to the diabetes epidemic among American children.
  • General Mills is an experienced, established brand and are the market leader in the USA, however, they have been lacking in innovation, have not cashed in on the booming health food craze and have been behind in creating new, niche products, especially in their yogurt division, where Yoplait is the only brand making a profit.
  • In 2008, although their products did not carry the recalled pistachios, several of their ice cream brands, Dryer’s, Edy’s and Haagen-Dazs, were still plagued with bad PR and loss of sales.

Opportunities

  • In today’s health conscious societies, they can introduce more health-based products, and because they are a market leader, they would likely be more successful.
  • Provide allergen free food items, such as gluten free and peanut free.
  • They launched a new premium line of higher cacao content chocolates dubbed Nestlé Treasures Gold, in order to cash in on the “recession economy” in which consumers cut back on luxury goods, but regularly indulge in candy and chocolate. Americans want luxury chocolates, and high-end chocolate is immune to the recession (so far), because it is an inexpensive indulgence.
  • Open Nestlé Café’s in major cities to feature Nestlé products.

Threats

  • Any contamination of the food supply, especially e-coli. Their Toll House brand cookie dough was recalled in March of 2009 because of e-coli. Outbreaks were linked to 28 states and the product had to be recalled globally. Nestlé has yet to find out how this happened, and is still investigating.
  • They were affected by the pet food recall in 2007, in which 95 different brands of dog and cat food were recalled due to contamination with rat poison. Also in 2007, FDA learned that certain pet foods were sickening and killing cats and dogs. FDA found contaminants in vegetable proteins imported into the United States from China and used as ingredients in pet food.
  • Raw chocolate ingredient prices are soaring; dairy costs alone rose 50% in 2008, this cuts heavily into their profit margins and often gets passed on to consumers, by shrinking the packaging in a way that is almost unnoticeable-therefore the consumer is paying the same prices for less product.
  • They have major competitors, like Hershey’s, Cadbury-Schweppes (owned by Pepsi), Lindt and Ghirardelli, Kellogg’s, Post, Starbucks, Beech-Nut, Quaker, Kraft Foods, Dannon, Del-Monte, Iams, Earth’s Best, Heinz, Frito-Lay (owned by Pepsi).

References

Boyle, M. (2008). Meet Google’s Willy Wonka. Retrieved on July 12, 2009.

Entrereneur Magazine. (n.d.). Flood of Fun-Hungry. Retrieved on July 12, 2009.

Slideshare. (2009). Nestlé 2008 Q3 Earnings. Retrieved July 12, 2009.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • Repeatedly ranked as the world’s largest bottled water company and have set up facilities to operate water resources in a responsible manner.
  • In 2008, Nestlé was named one of “America’s Most Admired Food Companies” in Fortune magazine for the twelfth consecutive year.
  • Nestlé provides quality brands and products and line extensions that are well-known, top-selling brands including:
  • Lean Cuisine, Yoplait, Maggi, Dryer’s/Edy’s, Haagen-Dazs, Stouffer’s, Boost, Dibs, Hot Pockets.
  • Chocolate and Candy: Kit Kat, Toll House, Butterfinger, Baby Ruth, Crunch Bar, the Willy Wonka Candy line.
  • Pet Products: Purina, Alpo, Cat Chow, Fancy Feast, Friskies, Tidy Cat.
  • Drinks: Carnation, Perrier, Nesquik, S. Pellegrino, Nescafe, CoffeeMate, Taster’s Choice, Juicy Juice.
  • General Mills: subsidiary which makes Betty Crocker, Bisquick, Hamburger Helper, Pillsbury, Old El Paso, cereals, fruit snacks, frozen pizza, canned soups, frozen vegetables, ready-made frozen meals.
  • Gerber: baby formula, prepared baby foods, baby cereals, water, juice, yogurt, foods for infants, toddlers and preschoolers.
  • Professional brands sold to restaurants, colleges, hotels, and food professionals including Jenny Craig meals, Impact liquid meals for trauma patients, liquid meals for diabetics, and OptiFast weight loss products.
  • Successful due in part to their unquestionable ability to keep major brands consistently in the forefront of consumer’s minds (and in their shopping carts) by renovating existing product lines, keeping major brands from slipping into saturation/decline and having superior access to distribution channels.

Molson Coors SWOT

Molson-Coors SWOT

Company Overview

Molson Coors Brewing Company (Molson Coors) is a holding company engaged in the manufacturing, packaging and selling of malt beverage products, including alcoholic beer, cider, ales, stouts and lager. The company operates primarily in the US, Canada and the UK. It is headquartered in Denver, Colorado. Coors is the name of an ambitious 19th-century pioneer whose dream grew into the world’s largest single-site brewery. Would you like a lesson on SWOT analysis?

Weaknesses

  • Coors operates the world’s largest brewery at its headquarters in Golden, Colorado, and distributes its 13 branded malt beverages in 30 countries worldwide–but 98 percent of revenues are generated in the United States, and that decreased by 97% in 2009 .
  • They rely on only a few popular brand names, which exposes the company to vulnerability when sales and economic regions fluctuate.
  • In 2009 company revenues decreased 36.5%. The Canadian region revenues decreases 9.8%; The UK revenues decreased 8.6%; revenues in the US decreased 97%; It seems that the revenues declined primarily due to weak demand in its core markets.
  • Molson Coors Brewing Company sold a 68% equity interest in its Brazilian unit, Cervejarias Kaiser to FEMSA Cerveza in 2006.
  • They are dependent on the raw materials of aluminum, wheat, barley and hops. The price of these raw goods have increased dramatically since 2008.
  • The perception in the US is that beer is for middle class or lower class members of society, making it difficult to sell their product to those with the most disposable income.

Opportunities

  • The Asian beer market provides ample business expansion possibilities, because they are a large consumer of the product and their populations are growing.
  • Creating more strategic alliances with other companies reduces risk as they move into foreign operations
  • Licensing agreements with theme parks, NASCAR racing circuit, Bowling Companies and/or complimentary food companies such as Johnsonville Brats.
  • They can produce a line of Organic Beer, Gluten free beer, or move into the higher priced market of beers.
  • Producing liquor or soda can also diversify risk, as sales of beer fluctuate.

Threats

  • Top competitors include: Ashai, Carlsberg, Heineken, Kirin, and Tsingtao.
  • Any significant increase in raw materials prices will negatively affect their margins.
  • Any significant decrease in the ability to obtain their raw materials will also affect their margins.
  • A negative perception that beer is not as healthy as other alcoholic beverages such as wine.
  • Economic recession in the US increases the sales of beer at first, but as the recession continues over a longer period of time, it may cause sales to decrease.

References

Funding Universe. (n.d.). Coors Brewing Company. Retrieved on September 8, 2010 from http://www.fundinguniverse.com/company-histories/Adolph-Coors-Company-Company-History.html

MarketLine. (2010). Molson Company Overview. Retrieved on September 8, 2010 from www.marketlineinfo.com

Molson Coors Brewing Company was founded in 1786 and Adolph Coors was founded in 1873. They survived prohibition in the US by bottling water. In 1959 they developed the aluminum can, a revolutionary way to package the product. In 1997, they developed the first non-alcoholic beer. In 2002, Adolph Coors acquired Coors Brewers and Molson Coors Brewing Company became one of the world’s largest brewers. The company now has a diverse portfolio of more than 65 strategic and partner brands positions with signature brands including Coors, Coors Light, Molson Canadian, and Carling. The company operates around 18 breweries and a number of distribution centers in more than 30 countries, mainly in Canada, the US and UK.

Strengths

  • They are an innovative company, first by surviving prohibition in the US, when their product was deemed illegal, they began to bottle water to keep the company going. When prohibition was repealed, they returned to bottling alcoholic products and developed the first aluminum can.
  • The company also has licensing agreement for Canadian market with other leading brands, which include: Amstel Light Heineken and Murphy’s, Asahi and Asahi Select, Miller Lite, Miller Genuine Draft, Miller Chill, Milwaukee’s Best and Milwaukee’s Best Dry, Miller, and Foster’s.
  • They recorded revenues of $73.9 million in FY2009, an increase of 17.5% over 2008. The operating profit of the company was $754 million in FY2009, an increase of 21.2% over 2008. The net profit was $720.4 million in FY2009, an increase of 90.2% over 2008.
  • In 2006, they signed a five-year partnership with the San Diego Chargers, an American football team. The agreement provided them with multiple marketing opportunities, including outreach to San Diego’s large military population and Hispanic consumers. Also in 2006, New Orleans Saints, another American football team, signed a two-year partnership with them.
  • In 2007, Coors Brewing introduced a package redesign and new advertising campaign for its Coors beer. In the same year, Coors Brewing rolled out its 2007 multicultural marketing strategy which was built on positioning Coors Light to the African-American and the US Hispanic populations.
  • In 2008, they launched  Coors Light beer in Sweden.
  • In 2009, the company launced the new 8, 10, 12 and 16 ounce Coors Light and Coors Banquet Cold Activated Cans across the US. Carling, the UK’s beer brand by Molson Coors, launched a 99 calorie bottle with 100% British barley. Also in 2009, Molson Coors (UK) and Cobra Beer formed Cobra Beer Partnership, a joint venture company for the manufacture and marketing of the Cobra beer brand across the UK.
  • In 2009, they partnered to introduce Coors Light beer in Costa Rica. They also introduced Coors Light in Trinidad &Tobago.
  • In May 2010, they agreed  to buy a 51% controlling interest in a new joint venture with the Hebei Si’hai Beer Company for $40 million. They will have control over the Si’hai brewing operations, including its contract brewing business in China.
  • In 2009, revenues from other foreign countries (other than Canada and the UK) reached $118.8 million in 2009, an increase of 28.2% over 2008.

McDonalds SWOT


SWOT Analysis McDonald’s

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Strengths

  • McDonald’s has been a thriving business since 1955 and 20 of the top 50 corporate staff employees started as a restaurant level employee. In addition, 67,000 McDonalds restaurant managers and assistant managers were promoted from restaurant staff. Fortune Magazine 2005 listed McDonald’s as the "Best Place to Work for Minorities." McDonalds invests more than $1 billion annually in training its staff, and every year more than 250,000 employees graduate from McDonald’s training facility, Hamburger University.

Weaknesses

  • Their test marketing for pizza failed to yield a substantial product. Leaving them much less able to compete with fast food pizza chains.
  • High employee turnover in their restaurants leads to more money being spent on training.
  • They have yet to capitalize on the trend towards organic foods.
  • McDonald’s have problems with fluctuations in operating and net profits which ultimately impact investor relations. Operating profit was $3,984 million (2005) $4,433 million (2006) and $3,879 million (2007). Net profits were $2,602 million (2005), $3,544 million (2006) and $2,395 million (2007).

Opportunities

  • In today’s health conscious societies the introduction of a healthy hamburger is a great opportunity. They would be the first QSR (Quick Service Restaurant) to have FDA approval on marketing a low fat low calorie hamburger with low calorie combo alternatives. Currently McDonald’s and its competition health choice items do not include hamburgers.
  • They have industrial, Formica restaurant settings; they could provide more upscale restaurant settings, like the one they have in New York City on Broadway, to appeal to a more upscale target market.
  • Provide optional allergen free food items, such as gluten free and peanut free.
  • In 2008 the business directed efforts at the breakfast, chicken, beverage and convenience categories. For example, hot specialist coffees not only secure sales, but also mean that restaurants get increasing numbers of customer visits. In 2009 McDonald’s saw the full benefits of a venture into beverages.

Threats

  • They are a benchmark for creating "cradle to grave" marketing. They entice children as young as one year old into their restaurants with special meals, toys, playgrounds and popular movie character tie-ins. Children grow up eating and enjoying McDonalds and then continue into adulthood. They have been criticized by many parent advocate groups for their marketing practices towards children which are seen as marginally ethical.
  • They have been sued multiple times for having "unhealthy" food, allegedly with addictive additives, contributing to the obesity epidemic in America. In 2004, Michael Spulock filmed the documentary Super Size Me, where he went on an all McDonalds diet for 30 days and wound up getting cirrhosis of the liver. This documentary was a direct attack on the QSR industry as a whole and blamed them for America’s obesity epidemic. Due in part to the documentary, McDonalds no longer pushes the super size option at the dive thru window.
  • Any contamination of the food supply, especially e-coli.
  • Major competitors, like Burger King, Starbucks, Taco Bell, Wendy’s, KFC and any mid-range sit-down restaurants.

McDonald’s is the leading global foodservice retailer with more than 31,000 local restaurants serving more than 58 million people in 118 countries each day. More than 75% of McDonald’s restaurants worldwide are owned and operated by independent local men and women. Read more…

Last updated July 2009

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • The business is ranked number one in Fortune Magazine’s 2008 list of most admired food service companies.
  • One of the world’s most recognizable logos (the Golden Arches) and spokes character (Ronald McDonald the clown). According to the Packard Children’s Hospital’s Center for Healthy Weight children age 3 to 5 were given food in the McDonalds packaging and then given the same food without the packaging, and they preferred the food in the McDonald’s packaging every single time.
  • McDonalds is a community oriented, socially responsible company. They run Ronald McDonald House facilities, which provide room and board, food and sibling support at a cost of only $10 a day for families with children needing extensive hospital care. Ronald McDonald Houses are located in more than 259 local communities worldwide, and Ronald McDonald Care Mobile programs offers cost effective medical, dental and education services to children. They also sponsor Olympic athletes.
  • They are a global company operating more than 23,500 restaurants in 109 countries. By being spread out in different regions, this gives them the ability to weather economic fluctuations which are localized by country. They can also operate effectively in an economic downturn due to the social need to seek out comfort foods.
  • They successfully and easily adapt their global restaurants to appeal to the cultural differences. For example, they serve lamb burgers in India and in the Middle East, they provide separate entrances for families and single women.
  • Approximately 85% of McDonald’s restaurant businesses world-wide are owned and operated by franchisees. All franchisees are independent, full-time operators and McDonald’s was named Entrepreneur’s number-one franchise in 1997. They have global locations in all major airports, and cities, along the highways, tourist locations, theme parks and inside Wal-Mart.
  • They have an efficient, assembly line style of food preparation. In addition they have a systemization and duplication of all their food prep processes in every restaurant.
  • McDonald’s uses only 100% pure USDA inspected beef, no fillers or additives. Additionally the produce is farm fresh. McDonald’s serves 100% farm raised chicken no fillers or additives and only grade-A eggs. McDonald’s foods are purchased from only certified and inspected suppliers. McDonalds works closely with ranchers, growers and suppliers to ensure food quality and freshness.
  • McDonalds only serves name brand processed items such as Dannon Yogurt, Kraft Cheese, Nestle Chocolate, Dasani Water, Newman’s Own Salad Dressings, Heinz Ketchup, Minute Maid Juice.
  • McDonald’s takes food safety very seriously. More than 2000 inspections checks are performed at every stage of the food process. McDonalds are required to run through 72 safety protocols every day to ensure the food is maintained in a clean contaminate free environment.
  • . McDonald’s was the first restaurant of its type to provide consumers with nutrition information. Nutrition information is printed on all packaging and more recently added to the McDonald’s Internet site. McDonalds offers salads, fruit, roasted chicken, bottled water and other low fat and calorie conscious alternatives.

Kroger SWOT

SWOT Analysis Kroger

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Strengths

  • Sturdy Market Position – Kroger has weathered the economic recession with relative success due to the strong market position it had going in. Kroger held number one and number two market share position in 39 out of 42 major markets in 2009. The company competed with 1,418 other supercenters and has achieved at least a number three market share position in 35 of its major markets.

Weaknesses

  • Vendor Quality Control Lapses – Kroger obtains a substantial portion of its merchandise from suppliers that it has limiter control over. As a result, a number of consumer alerts and product recalls have been necessary. . In the first quarter of 2009, Kroger recalled a number of products including Lawry fajitas spices, and Lian How chili garlic sauce. Other recalls include Banquet Pot Pies, Kroger California Seasoning Blend Garlic Powder and Kroger Special Seasoning Blend Lemon Pepper. Obviously these recalls especially those deemed hazardous to ones health serve to harm the company’s brand image by reducing customer confidence and loyalty.

  • A Unionized Workforce – Kroger’s unionized workforce puts it at a competitive disadvantage when compared with its peers Wal-Mart, Sears or Target. Its competitors enjoy lower labor costs and other operating efficiencies. This environment often includes time-consuming labor negotiations and the formulation of agreements in order to avoid work stoppages. Each work stoppage comes with the potential to impact the bottom line.

  • Legal proceeding related to Ralph’s Grocery Company case – Kroger has faced a relatively long list of legal issues stemming from its acquisition of Fred Meyer and Ralph’s Grocery. Among them include a settlement in 2006 over illegal hiring practices that occurred during a 141 day labor dispute. Potential legal issues for Kroger have also loomed in connection with Ralph’s alleged improper accounting practices. Kroger is awaiting a decision by the Commissioner of the Internal Revenue Service with regard to a transaction between Ralph’s Holding Company and Ralph’s Grocery. A negative decision in the case could have substantial financial impact on Kroger.

Opportunities

  • Increased Emphasis on Private Label Brands – Kroger continues to develop its private brands as a strategic asset. With a goal of decreasing its dependence on national brands, Kroger has increased promotions of its own products which include more than 14,000 brands. During the fourth quarter of FY2009, the company’s private label brands accounted for approximately 27% of the entire grocery sales. Private Selection, a private brand owned by Kroger, exceeded $1 billion in sales in FY2009. These brands have offered much appreciated savings to its customers during the economic recession.

  • Strategic Expansion Plans – Kroger plans on implementing an expansion plan which entails store relocations and store remodeling and new store openings. The Plan help the company enhance its in-store store productivity and to penetrate new markets. This in turn would allow Kroger to reach a larger customer base. Kroger has increased its capital outlay from $1.8 billion in 2007 to $2.1 in FY2009. The company is planning to spend around $1.9 to $2.1 billion during FY2010. Kroger hopes another by product is increase its operational productivity and reduced cost.

  • In-Store Health Clinic Program – Kroger is striving to better serve its customers by providing walk-in medical clinics and consumer health assistance in its stores. By partnering with The Little Clinic Kroger is able to offer the services of licensed nurses and certified physician assistants to diagnose treat and write prescriptions for common illnesses as well as for minor injuries. Kroger intends to implement the program throughout its stores and by doing so hopes to reap rewards of addition customer revenues.

Threats

  • Increasing Labor Costs – The majority of the Kroger’s 326,000 employees are covered by collective labor agreements negotiated with local unions affiliated with one of several different international unions. Kroger employees have benefited from recent increases in the federal minimum wage and it is predicted they will also benefit from health care reform. These changes present financial challenges for Kroger and have the potential to negatively impact its operating costs, as well as profitability.

  • High Debt Burden – Kroger may find itself in a position where a substantial portion of its cash flow must be funneled into paying down its indebtedness. A large percentage of debt has gone toward the implementation of its restructuring, remodeling and new store opening projects. The current economic climate has curbed the willingness of the financial industry to refinance debt. This reluctance, coupled with its $8 billion debt load may hinder future growth opportunities for the company.

  • Dismal Economic Projections – The slumping economy continues to have a negative impact of consumer expenditures. The first quarter of 2009 registered a drop of 60.5% in the US Consumer Confidence Index, the score of 26 in March 2009 as compared to the score of 65 during same period in the previous year. Current job data outlined in The Conference Board Employment Trends Index for April 2010 indicates a moderate recovery may be underway; however a slow recovery may continue to stifle potential expenditures by Kroger customers.

The Kroger Co. spans many states with store formats that include grocery and multi-department stores, convenience stores and mall jewelry stores. We operate under nearly two dozen banners, all of which share the same belief in building strong local ties and brand loyalty with our customers. More . . .

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • The company’s brand equity provides a strong competitive advantage over other firms. In 2009 Kroger was listed 82nd in the Global 500 Brand Ranking (Ranking the Brands.com), while the Reputation Institute listed it among the top 20 most reputable companies. This strength will serve the company well as it endures its most recent negative earnings forecast.
  • Three-pronged Branding Approach – Private selection, banner brands and Kroger value represent the company’s three-tiered branding approach. Specifically, the private selection brand strives to compete with national upscale brands, while Kroger value delivers quality items at lower prices. The banner brands consist of the company’s private label items like Ralph’s, King Soopers, and Kroger. The three-pronged approach enables Kroger to meet the demands of a wide range of customers and offers them savings not available with national brands.

  • Proficient Manufacturing Capabilities – Kroger operates around 40 manufacturing plants for processing, packaging and manufacturing its private label products. The company manufactured approximately 43% of its 14,400 private label items in its plants. Kroger’s inventory of manufacturing plants Include 18 dairies, 10 deli or bakery plants, five grocery product plants, three beverage plants, two meat plants and two cheese plants. These manufacturing capabilities allow for more efficient quality control and efficient distribution to stores.

  • Diversified Retail Product Inventory – Kroger product inventory includes a wide range of private and national brand products in a number of product categories including food produce, grocery, beverages, apparel, meat, jewelry, accessories, and general merchandise. The diversification strategy is also evident in its fuel service stations and financial services. This wide range of products and services enables the firm to create a one-stop atmosphere which facilitates frequent repeat visits for a number of purposes.

Johnson and Johnson SWOT

SWOT Analysis Johnson & Johnson

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Strengths

A Substantial Marketing Arsenal

Johnson & Johnson can call upon a network of subsidiaries armed with significant sales and marketing prowess, as well as expertise in a number of therapy areas. The company possesses a global sales force which serves to attract joint venture possibilities.

Opportunities

Wide Range of Potential Cross-selling Opportunities

Johnson & Johnson is in a position to strategically develop a myriad of cross selling opportunities. Using the disease life cycle as a base the company could exploit its product line in CV, oncology, diabetes and I&I therapy to formulate linkages between patents and care-giving resulting in greater efficiency. Maximizing its balance between Pharmaceuticals, Diagnostics, and Medical Devices could result in increased revenues.

Potential to Exploit Biologics Market

The addition of further biologics to its portfolio can serve as a buffer as mall molecule patents expiries. J&J is experienced in the development and commercialization of biologics—including the therapeutic proteins Procrit and Natrecor, and monoclonal antibodies Remicade, ReoPro, Simponi and Stelara. This represents an opportunity to gain key IP, product rights or strengthen discovery capabilities. In July of 2009 Johnson & Johnson was selected by Elan to form a joint venture for the development and commercialization of these products. In addition, J&J acquired an 18.4% equity stake in the company.

Threats

Dependence on the Success of Launch Products

Many new launch products are vulnerable to the uncertainty of regulatory review and ultimate market benefits may vary substantially from forecast, therefore, a reliance upon launch products potentially represents a threat to Johnson & Johnson’s outlook.

Negative Impact of Recent Product Recalls

Johnson and Johnson has the misfortune of having to recall of more than 40 medicines recently. FDA inspectors required the company to recall the children’s medications after discovering the company had not looked into dozens of consumer complaints about “black or dark specks” in Tylenol and other products. The company stands to take a hit to its sterling reputation as congressional lawmakers are blasting the company’s competence and integrity.

Caring for the world, one person at a time… inspires and unites the people of Johnson & Johnson. We embrace research and science – bringing innovative ideas, products and services to advance the health and well-being of people. Employees of the Johnson & Johnson Family of Companies work with partners in health care to touch the lives of over a billion people every day, throughout the world. More . . .

Strategic Acquisitions

Johnson & Johnson has maintained a stable financial position by utilizing cash reserves to finance timely corporate acquisitions. Its’ Triple –A Credit Rating represents a company able to take advantage of opportunities that arise without being limited by burdensome levels of debt.

Product Diversification

The Johnson & Johnson pharmaceutical portfolio, and ts large Medical Devices & Diagnostics (M,D &D) and Consumer Health divisions serves to reduce dependence upon any one area. The company plans to continue this broadening through 2008-14. This diversification allows a wider range of choice when pursuing opportunities with the greatest growth prospects.

Positive Revenue Growth Projections

The potential of an impressive number of new product launches and the promise of achieving forecast sales is said to bode well for Johnson & Johnson, helping it weather the recent decline in prescription pharmaceuticals and projecting a turn-around through 2010. An increase at 1.8% CAGR across 2008–14 is believed to be achievable.

Weaknesses

Dependence on the Success of Launch Products

Many new launch products are vulnerable to the uncertainty of regulatory review and ultimate market benefits may vary substantially from forecast, therefore, a reliance upon launch products potentially represents a threat to Johnson & Johnson’s outlook.

Reliance on Small Molecule Drugs

Compared to biologics, small molecules are notably more impacted by generic competition. As such, although the Johnson & Johnson is engaged in producing new small molecule products, when coming off-patent, declines are still forecast. This is particularly the case in the US, where generic erosion rates are most aggressive. Johnson & Johnson’s small molecule drug sales declined in 2008 and are forecast to fall further into 2012. Teses issues reflect concerns expressed across the pharmaceutical industry—the necessity of finding replacements for billion dollar products as they mature represents an daunting task.

ITC SWOT

SWOT Analysis ITC

ITC is one of India’s biggest and best-known private sector companies. In fact it is one of the World’s most high profile consumer operations. This SWOT analysis is about ITC. Its businesses and brands are focused almost entirely on the Indian markets, and despite being most well-known for its tobacco brands such as Gold Flake, the business is now diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market sectors

Opportunities

Core brands such as Aashirvaad, Mint-o, Bingo! And Sun Feast (and others) can be developed using strategies of market development, product development and marketing penetration.

ITC is moving into new and emerging sectors including Information Technology, supporting business solutions.

e-Choupal is a community of practice that links rural Indian farmers using the Internet. This is an original and well thought of initiative that could be used in other sectors in many other parts of the world. It is also an ambitious project that has a goal of reaching 10 million farmers in 100,000 villages. Take a look at eChoupal here http://www.itcportal.com/agri_exports/e-choupal_new.htm

ITC leverages e-Choupal in a novel way. The company researched the tastes of consumers in the North, West and East of India of atta (a popular type of wheat flour), then used the network to source and create the raw materials from farmers and then blend them for consumers under purposeful brand names such as Aashirvaad Select in the Northern market, Aashirvaad MP Chakki in the Western market and Aashirvaad in the Eastern market. This concept is tremendously difficult for competitors to emulate.

Chairman Yogi Deveshwar’s strategic vision is to turn his Indian conglomerate into the country’s premier FMCG business.

Per capita consumption of personal care products in India is the lowest in the world offering an opportunity for ITC’s soaps, shampoos and fragrances under their Wills brand.

Threats

The obvious threat is from competition, both domestic and international. The laws of economics dictate that if competitors see that there is a solid profit to be made in an emerging consumer society that ultimately new products and services will be made available. Western companies will see India as an exciting opportunity for themselves to find new market segments for their own offerings.

ITC’s opportunities are likely to be opportunities for other companies as well. Therefore the dynamic of competition will alter in the medium-term. Then ITC will need to decide whether being a diversified conglomerate is the most competitive strategic formation for a secure future.

ITC was incorporated on August 24, 1910 under the name of ‘Imperial Tobacco Company of India Limited’. Its beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the Company’s existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. Read more…

Bibliography

Wiki – ITC
ITC’s own official site

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

– including cigarettes, hotels, paper, agriculture, packaged foods and confectionary, branded apparel, personal care, greetings cards, Information Technology, safety matches, incense sticks and stationery. Examples of its successful new FMCG products include:

  • Aashirvaad – India’s most popular atta brand with over 50% market share. It is also present in spices and instant mixes.
  • Mint-o – Mint-0 Fresh is the largest cough lozenge brand in India.
  • Bingo! – a new introduction of finger snacks.
  • Kitchens of India – pre-prepared foods designed by ITC’s master chefs.
  • Sunfeast – is ITC’s biscuit brand (and the sub-brand is also used on some pasta products).

Strengths

ITC leveraged it traditional businesses to develop new brands for new segments. For example, ITC used its experience of transporting and distributing tobacco products to remote and distant parts of India to the advantage of its FMCG products. ITC master chefs from its hotel chain are often asked to develop new food concepts for its FMCG business.

ITC is a diversified company trading in a number of business sectors including cigarettes, hotels, paper, agriculture, packaged foods and confectionary, branded apparel, personal care, greetings cards, Information Technology, safety matches, incense sticks and stationery.

Weaknesses

The company’s original business was traded in tobacco. ITC stands for Imperial Tobacco Company of India Limited. It is interesting that a business that is now so involved in branding continues to use its original name, despite the negative connection of tobacco with poor health and premature death.

To fund its cash guzzling FMCG start-up, the company is still dependant upon its tobacco revenues. Cigarettes account for 47 per cent of the company’s turnover, and that in itself is responsible for 80% of its profits. So there is an argument that ITC’s move into FMCG (Fast Moving Consumer Goods) is being subsidised by its tobacco operations. Its Gold Flake tobacco brand is the largest FMCG brand in India – and this single brand alone hold 70% of the tobacco market.

Infosys SWOT

SWOT Analysis Infosys

Infosys is one of the largest businesses in India with a turnover in excess of $4 billion in 2008. The company specializes in Information Technology (IT) and consulting. N.R. Narayana Murthy and six others started the company in 1981, and it is now the largest IT company in India with its headquarters in Bangalore (although it was started in Pune). It employs more than 90,000 IT professionals and was famously rated ‘Best Employer in India. Would you like a lesson on SWOT analysis?

Opportunities

  • At a time of recession in the global economy, it may appear that some companies will reduce take up of services that Infosys offers. However, in tough times clients tend to focus upon cost reduction and outsourcing – with are strategies that Infosys offers. So hard times could be profitable for Infosys.
  • There is a new and emerging market in China as the country undergoes a huge industrial revolution.
  • The strategic alliance between Infosys and Schlumberger gives the IT company access to lucrative business in the gas and oil industries.
  • There has been a trend over recent years for European and North American companies to base some or all of their operation in India. This is called an offshore service. Essentially there is a seamless link between domestic operations and services hosted in India. Examples include telecommunications companies such as British Telecom and banks such as HSBC that have customer service and support centres based in India. Think about the times that you have made calls to a support line to find that the adviser is in Mumbai or Bangalore and not in your home market.

Threats

  • India is not the only country that is undergoing rapid industrial expansion. Competitors may come from countries such as China or Korea where there are large pools of low-cost labor, and developing educational infrastructures such as universities and technology colleges.
  • Customers may switch to other offshore service companies in other countries such as China or Korea.
  • Other global players have realised that India has the benefit of low-cost, highly-skilled labor that often speaks English and is culturally sensitive to Western practices. As with all global IT players, Infosys has to compete for skilled labor and this may have the effect of driving up wage levels, and making it more difficult to recruit and retain staff.

Bibliography

Wiki – Infosys
Infosys’s own official site
Business Today – The Best Companies to Work for in India
Business Today – 20 companies to watch in 2008

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

It operates in a number of business sectors from banking to retail, and its services tend to encompass end-to-end IT solutions which includes a whole bundle of added-value solutions from infrastructure to software engineering. This SWOT analysis is about Infosys.

Strengths

  • Since the company is based in India its competitive advantage is enhanced. The Indian economy, despite weak economic indicators such as relatively high rates of inflation, has low labor costs. The workforce has relatively high skills levels in Information Technology. Couple these two elementstogether and you have an operational basis that offers low-cost based, highly skilled competitive advantage. Trained Indian personnel often speak very good English and are sensitive to Western culture, underpinned by India’s colonial past.
  • Infosys is in a strong financial position. The business turned over more than $4 billion in 2008. This means that it has the capital to expand, and also the basis to leverage potential investors.
  • The company has bases in 44 global development centres, most of which are located in India, although the company has offices in many developed and developing nations. This means not only that Infosys is becoming a global brand but also that it has the capability to support the global operations of multinational clients.

Weaknesses

  • Infosys on occasion struggles in the US markets, and has particular problems in securing United States Federal Government contracts in North America. Since these contracts are highly profitable and tend to run for long periods of time, Infosys is missing out on lucrative business. Added to this is the fact that its competitors do well in terms of securing the same Federal business (and one should also take into account that many of its competitors are domiciled in the US and there could be political pressure on the US Government to award contracts to domestic organizations).
  • Despite being a huge IT company in relation to its Indian competitors, Infosys is much smaller than its global competitors. As discussed above, Infosys generated $4 billion in 2008, which is relatively low in comparison with large global competitors such as Hewlett-Packard ($91 billion), IBM ($91 billion), EDS ($21 billion) and Accenture ($18 billion).
  • It is sometimes argued that Infosys is weaker when it comes to high-end management consultancy, since it tends to work at the level of operational value creation. Competitors such as IBM and Accenture tend to dominate this space.

Indian Premier League

SWOT Analysis Indian Premier League (IPL)

Where will you find the Mumbai Indians, the Royal Challengers, the Deccan Chargers, the Channai Super Kings, the Delhi Daredevils, the Kings XI Punjab, the Kolkata Knight Riders and the Rajesthan Royals? In the Indian Premier League (IPL) – the most exciting sports franchise that the World has seen in recent years, with seemingly endless marketing opportunities (and strengths, weaknesses and threats of course!). This SWOT analysis is about The Indian Premier League.

Opportunities

  • Since it has a large potential mass audience, IPL is very attractive as a marketing communications opportunity, especially for advertisers and sponsors.
  • The league functions under a number of franchises. Each franchisee is responsible for marketing its team to gain as large a fan-base as possible. The long-term success of all of the franchises lies in the generation of a solid fan-base. The fan-base will generate large TV revenues.
  • Different fans will pay different amounts to watch their sport. There will be corporate hospitality, season tickets, away tickets, TV pay-per-view and other ways to segment the market for the IPL.
  • There is a huge opportunity for merchandising e.g. sales of shirts, credit cards and other fan memorabilia. Grounds can also sell refreshments and other services during the games.
  • Marketers believe that the teenage segments need to be targeted so that they become the long-term fan-base. Their parents and older cricket fans may prefer the longer, more traditional game. The youth market may also impress on their parents that they want them to buy their club’s merchandise on their behalf – as a differentiator or status symbol.
  • Franchise fees will remain fixed for the up until 2017-18, which means that the investment is safe against inflation which is traditionally relatively high in India.

Threats

  • The level of competition that the Board of Control for Cricket in India (BCCI) can generate determines long-term viability of the league. If the level of competition drops, then revenue will fall. For example, if the top names in cricket cannot be attracted to India, the appeal of the game will fall. Often getting hold of the big names is a problem – Australian domestic cricket runs concurrent with the IPL and if players move form Australia to India to follow the money then their domestic game will be hit. This is known as ‘Free Agency.’
  • If the franchisee’s fan-base does not generate income then they may not have the cash to pay the salaries of the best players. However, if you invest in the best players and they do not win the trophies, then you may not see a return on your investment. It won’t be a quick return on investment – so owners need to be in it for the long-term.
  • Franchises are very expensive. The most expensive franchise – Mumbai Indians – was bought by Mukesh Ambani for $111.9 million, whereas the lowest priced franchise – Rajasthan Royals was picked up by Manoj Badale for a mere $67 million.
  • The most highly priced teams may not be those that have the early success. Revenues will come from the most highly supported teams.

The Indian Premier League (also known as the "DLF Indian Premier League" for sponsorship reasons; often abbreviated as IPL), is a Twenty20 cricket competition created by the Board of Control for Cricket in India (BCCI).Read more…

Bibliography

Indian Premier League Official Website.

Indian Premier League, Wikipedia, 5th July 2008.

Will cricket’s new czars make money? Shamni Pande and Tejeesh N.S. Behl – Business Today 14th May 2008.

IPL’s economics demystified, Ram Tamara and Michael Maloney – Business Today 14th May 2008.

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

Strengths

  • The Indian Premier League (IPL) is based upon the Twenty20 cricket game which should be completed in 2 ½ hours. That means that is fast-paced and exciting, and moreover it can be played on a weekday evening or weekend afternoon. That makes it very appealing as a mass sport, just like American Football, Basketball and Soccer. It is appealing as a spectator sport, as well to TV audiences.
  • The IPL has employed economists to structure its lead so that revenue is maximized. The more unified the sport, the more successful it is.

Weaknesses

  • Twenty20 has been so popular that it could replace other forms of cricket i.e. damage the game that generated it.
  • Some fans will also have to pay for travel to the ground. There may be large queues for the most popular games. There may be some distance between where the fan lives and the cricket ground.
  • Stakes are very high! Some teams may not weather short-term failures and may be too quick to get rid of key managers and players if things don’t go well quickly. Famously, Royal Challengers Bangalore (RCB) sacked their CEO Charu Sharma for watching his team lose 6 from their first 8 games.
  • Some teams have overpriced their advertising/sponsorship in order to gain some short-term returns (e.g. Royal Challengers), and some sponsors and are moving their investment the more reasonably priced teams.

Ikea SWOT

SWOT Analysis Ikea.

IKEA is amongst the biggest retailers of furniture in the world. Would you believe that the business sells more than 10,000 furnishing products from well over 300 stores in around 40 countries. The company has in excess of 600 million visitors to its stores, and its very successful website attracts in excess of 600 million visitors every year. IKEA is a Scandinavian company famous for furniture from living rooms to children’s bedrooms. Would you like a lesson on SWOT analysis?

Weaknesses

The business is experiencing problems in one or two home markets. For example in the European market of the United Kingdom, IKEA has recently opened more stores which means that the number of visitors is divided by a greater number of retail outlets. So in the past the consumers would travel many miles to visit stores and each store had a large number of visitors, now these consumers have not really increased in number, but are now able to visit a more local store. This has reduced the footfall per store and any sales density.

One problem experienced by IKEA is that its flagship stores are not located in city centres, or even secondary locations near large populations. They are out-of-town stores. So consumers have to travel large distances to visit the stores. Their customers have to not only cost their travelling expenses, but they also have to collect large packages and take them home. This would be a competitive disadvantage.

Opportunities

IKEA is traditionally famous for its diversification strategies. For example in the past they have sold food products and opened restaurants in their stores. So the online opportunity of trading through highly advanced e-commerce technologies is an ideal avenue for IKEA. Obviously this helps the business to overcome problems with out-of-town stores since consumers can stay at home to shop and then request that goods are delivered to their doorstep.

Another opportunity lies within the new low-cost manufacturing nations of China and India. So costs can be reduced and margins possibly increased by reducing labour costs. This will also give the business the opportunity to enter these potentially lucrative developing consumer societies. Furniture could be made in factories in China, and textiles for curtains for example could be made in India.

Threats

Businesses such as IKEA will struggle against the larger portfolio suppliers such as Tesco in the United Kingdom and Walmart in the United States. For example Tesco’s sells not only groceries, but TV sets and mobile phones, so it is only a matter of time before the business diversifies into a range of bedroom furniture or kitchens.

Like any global marketing company IKEA has to compensate for the global economic situation. The business needs people to move through the family life cycle. Empty nesters need to equip their homes with furniture. So interest rates need to be low enough so that they can afford to borrow money to equip their new homes. There needs to be plenty of low-cost housing for them to be able to do this. Do they have job security? The changing economic environment will impact and influence IKEA’s furniture business.

IKEA is trading in relatively mature consumer markets, and has entered all plausible free markets countries. The new and emerging nations of India and China sometimes make it difficult for IKEA to embed itself as a supplier to new consumers. For example, there are often foreign ownership rules which mean that IKEA might have to take a local business partner. The new partner could take more than 50% of its business and this is not always acceptable to its board.

Strengths

IKEA is certainly an environmentally friendly business with a keen focus upon sustainability. In years gone by the company had been accused of encouraging wastefulness since it made a very large numbers of furniture products at low prices. As part of an integrated public relations campaign – IKEA now focuses on sustainability and made it an underpinning principle of its business philosophy.

In 2011 IKEA has the enviable record of recycling more than 85% of the packaging and other waste from its stores. Products and materials, suppliers, climate change and community involvement are the fundamental principles of IKEA’s sustainability approach. For example, IKEA imposes very strict control measures on some of its suppliers, such as those based in the greater China region.

IKEA likes satisfied customers. The business manages to score highly in customer satisfaction surveys. Many marketing research companies rank IKEA in their top 10 companies for customer satisfaction. They managed to enhance their brand association with such great results.

Let’s face it IKEA is probably the biggest furniture retail name in the world. This is a business with more than 10,000 products available on every continent. They offer low prices and products that offer good value. If you want hard wearing and long-lasting, you will pay more for it elsewhere. IKEA has positioned its business offering away from high-quality and high price, and also a way from low quality, low price. It is in a very enviable position.

Home Depot SWOT

SWOT Analysis Home Depot

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Strengths

  • Brand Awareness – Home Depot is the world’s largest company in the home improvement retail industry with revenues exceeding $70 billion. Specifically, while Home Depot is the fourth largest retailer in the United States, it is the largest in both Canada and Mexico. In addition, it ranks 127th in Forbes Global list of the 2000 largest companies.

Opportunities

  • Reorganization Initiatives– Home Depot has responded to the current unfavorable economic conditions by readjusting its business focus and business practices. Specifically, the company has left behind its participation in such ventures as Yardbirds, THD Design Center, Expo and HD Bath businesses. Its new focus is also seen in the closure of 15 stores and renewed efforts to maximize productivity at existing stores.
  • Increased Demand for Power Tools – Home Depot will probably benefit from the growing demand for power tools. There was a forecasted increase of over 3% or $15.1 billion in sales in 2009. At the core of the increased popularity of these tools is the demand for high end power tools such as electric screwdrivers, electric drills and saws. Thanks to products like its Makita and Milwaukee Lithium-ion power tools; Home Depot is well positioned to take advantage of the growing demand.
  • Growth in Online Purchasing
    Home Depot should benefit from the projected growth in online sales. Online retail revenues for 2009 were projected to increase 4.1% from 2008 to $142.4 billion in sales. Despite an anticipated economic slowdown, online sales revenue is still estimated to increase by 9.5% in 2010 and 9.2% in 2011. Home Depot is positioned to capture its share of these online sales via its websites homedepot.com, homedepot.com.ca and homedepot.com.mx. Since these revenues can be obtained through online sales; Home Depot will benefit through a reduction in operating costs.
  • Threats

  • Rise in Customer Service Complaints
    Recently, visitors to Home Depot have encountered employees who did not have a thorough understanding of store inventory or product utility. This apparent lack of training has contributed to a rise in customer complaints. According to the J.D. Power and Associates 2009 Home Improvement Retail Store Study approximately one-half of shoppers (51%) asked the sales staff for assistance during their most recent visit to a home improvement retail store–down from 61 percent in 2008. The two most common reasons customers ask for assistance are for help locating a product or for additional information about a product. If these encounters are negative they will no doubt have an adverse impact on company image and bottom line.
  • Government Investigations and Litigation
    The Home Depot Brand image may also suffer from a number of government inquiries and investigations. For example, in 2008 the Environmental Protection Department of New Jersey alleged recordkeeping violations with respect to its use of generators. The department issued an Administrative Order and Notice of Civil Penalty Assessment.
  • A slumping US Economy
    The continuing economic doldrums gripping the United States has dampened consumer appetite for making major purchases. Spending on home improvement projects is expected to decline at an annual rate of 12.1% by the third quarter, according to a report by Harvard University’s Joint Center for Housing Studies. Home Depot joins competitors such as Lowes and Menards in taking a second look at expansion plans.
  • The Home Depot – We are the world’s largest home improvement specialty retailer with stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, 10 Canadian provinces, Mexico and China. More . . .

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    Such dominance boosts brand awareness for such private brands as Pegasus Faucets, Husky Hand Tools, and Vigoro Lawn Care Products. Such brand awareness is fortunate for Home Depot since recent studies show that 80% shoppers have a positive attitude about private brand labels and some even perceive their quality as being superior.

  • Rapid Deployment Centers -Home Depot plans on increasing its utilization of Rapid Deployment Centers (RDC). RDCs allow the use of a single purchase order to consolidate product needs and more rapidly replenish inventories to individual stores from the center locations. Home Depot currently employs five Rapid Deployment Centers and plans to open additional centers in 2010. The result of this implementation will be improved transportation, and reduced lead time from notification of needs to inventory replacement. It is anticipated that this method will increase efficiently substantially.

  • Weaknesses

  • Negative Comparable Store Sales Figures – Home Depot suffered a decrease in same store sales, down 8.7% is 2009 as compared to a smaller decrease of 6.7% in 2008. The decline is significant because it is a measure of operational productivity. In the case of Home Depot, some of the decrease may be attributable to the economic decline and the accompanying reduction of construction and home improvement expenditures. The current economic client and comparable store sales figures will force Home Depot to increase its focus on finding a merchandise mix that attracts more customers.
  • Product Recalls – A Home Depot practice of buying products from a large number of vendors makes it vulnerable when quality levels are insufficient; recently the company has found it necessary to announce several product recalls. In-wall electronic timers, patio umbrellas, and candle holders are among products recently deemed unsafe. These recalls join others initiated in 2004, 2005, and 2006 suggest poor quality control practices and negatively impact Home Depot’s brand image.

  • IBM SWOT

    IBM SWOT

    Dr. Jill Novak, University of Phoenix, Texas A&M University {Contributing Writers: Jaime and Jennifer Hermann)

    In 1924, The Computing-Tabulating-Recording Company adopted the name International Business Machines Corporation.  IBM has been involved in many technological advances since the early twentieth century from tabulating countries’ census reports to sporting event analysis to developing computer software and e-business.  IBM today is not just the Hardware giant that we have come to know.  Most of their revenue comes from software and consulting and leads the world in technological achievements. Would you like a lesson on SWOT analysis?

    Opportunities

    • Increased globalization is an important opportunity that can be exploited by IBM in order to balance the fluctuations in different economies.
    • Their brand image is synonymous with “big” and “old” they need to create products appealing to a younger generation and reposition their company.
    • IBM needs to maintain a competitive edge in the marketplace and innovation is key and working with IT-related companies to create new products in the ever changing market; use patents to generate revenue. 
    • IBM’s love of open source operating systems, specifically Linux, benefits IBM in both the short and long term.  IBM can sell its i-series platforms with Linux to respond to the growing demands of the operating systems (OS).  Also, IBM can also use Linux on its Z-series mainframe line and even its p-series machines which mostly uses IBM’s own AIX which usually competes against the UNIX operating system.  Open architecture is key to creating and maintaining market share.
    • IBM’s small-medium business (SMB) has improved over the years but there is definitely a need to increase its market share to have an overall competitive edge. 

    Threats

    • The fact that they are completely dependent on Microsoft (in their computer services division) could be a huge problem if anything ever happened to them.
    • Hackers and sensitive information can be exposed and exploited by individuals and IBM needs to be innovative with regards to firewalls and protective software.
    • The supply chain has very few suppliers, leaving IBM very little to negotiate with or switch to.
    • HP, Sun Microsystems are all competitors and are all threats to IBM’s bottom line.  Their competitors are able to create cheaper products and make more a considerable profit. Smaller companies that can move faster and provide less expensive products and services than IBM can become very costly to IBM’s more lucrative bundles focusing more on larger companies with big budgets.

    History of IBM

    When you look at our history, you see that we have had a real and lasting impact on the world because of our unique character — our core values, our behaviour and our performance as IBMers. Take a look back at the innovations, people and values that have defined IBM for nearly a century. More . . .

    Strengths

    • IBM leads the world in technological success with patents in the United States for 17 straight years.  In 2008 IBM earned 4186 patents and in 2009 they increased that amount to 4,914.  It published almost 4,000 technical inventions and products without patent protection in 2009; this is a valuable intellectual property.
    • They are the company handling 95% of all business in the 1000 most profitable companies in the US.
    • In 2009 they were recognized as the 4th most recognized brand name in the world and they have been consistently in the top 10 for 20 years.
    • IBM is one of the largest and most profitable companies in the world, with a value of $66 billion. They have over 400,000 employees worldwide.
    • It is an old, established company, founded in 1896 as the Tabulating Machine Company by Herman Hollerith, in Broome County, New York.
    • In 1945 they were the first company to establish dedicated research labs for the creation of technological innovation, which lead to the creation of computers, voice recognition software and products that assist those working in medicine and radiology.  

    Weaknesses

    • IBM’s size is also its weakness.  IBM’s goliath size can make it slower to react to customer’s needs and wants as well as to the industry’s fluctuations.  And it’s more than 400,000 employees can make it difficult to find the support and services needed.
    • Enormous operating costs and competitors eating into their market share forced them in 2010 to buy back $8 billion in stock.
    • Transferring jobs oversees has been an option IBM is using more and more.  At the end of 2009, IBM USA had a workforce of 105,000 down 30,000 in just a few years.  In 2009, there were rumors that IBM wants to get the US workforce down to 70,000.  This is not a weakness for other countries that are absorbing many of these US jobs.
    • Communication across these different countries can be very challenging. For example, having the helpdesks in India creates language barriers in the US.  Also, India has exported many engineers to the US because they are cheaper to pay but also Indian Engineers do not have both the educational and experiential accolades of their US counterparts.  Many of them come over to the states and the few US employees left in the department have to re-train them, wasting countless hours that could be used in supporting their customers. 
    • The current recession has hurt everyone and IBM is not exempt.  Financial services, which accounts for 30% of IBM revenue, has declined.  It’s riddled with subprime mortgages forcing to mark down their portfolios to ridiculously low “market” prices on packaged securities that are trading at a fraction of their theoretical value.  This, in turn, is affecting the equity of banks, and therefore their ability to lend. 
    • Servers and Storage which account for about 20% of IBM’s revenue has declined to 16% and a 6% decline in margins. 

    Hewlett Packard SWOT

    SWOT Analysis Hewlett Packard

    Would you like a lesson on SWOT analysis?

    Strengths

    • Strong Market Position – Recently (April 2010), Hewlett-Packard’s shares closed at $53.15. According to NASDAQ, the stock is up 62% in the past year, better than the market at large. This continues a trend that saw the company ease pass the previous global pc leader Dell in 2006. In 2008 Hewlett Packard led Dell with over 17% of the PC Market while Dell settled for second at 14%.

    Opportunities

    • Expanding presence in cloud computing market – Cloud computing describes a new delivery model for IT services. In July 2008, HP along with Intel Corporation and Yahoo! created a global, multi-data center, open source test bed for cloud computing research and education. The goal of the project was to promote collaboration among industry, academy and governments by removing the financial and logistical barriers. In 2009, HP announced HP Cloud Assure, a new SaaS offering designed to assist businesses to safely and effectively adopt cloud-based services. HP Cloud Assure consists of HP services and software, including HP Application Security Center, HP Performance Center and HP Business Availability Center. These solutions are delivered to customers though HP SaaS platform. The increasing demand for cloud computing is likely to create demand for HP’s solutions in coming years. The global spending on cloud computing is forecast to cross a value of over $40 billion by 2012

    • Expanding portfolio of imaging and printing solutions – Hewlett Packard has made several strategic acquisitions and introduced new products in the imaging solutions segment in recent times. Its imaging solutions strategy entails the commercial markets, from print services solutions to new growth opportunities in commercial printing and capturing high-value pages in areas such as industrial applications, outdoor signage, and graphic arts. Among those key acquisitions are Tabblo, Logoworks, MacDermid and ColorSpan.
    • HP has launched several retail photo printing solutions and services that provide consumers the tools to personalize their photos and publish customized creative output. In addition, it has introduced new digital printing technologies, HP Inkjet Web Press, HP Latex Inks and three HP Indigo presses, as part of its graphic arts offerings. In October 2008, it also announced a plan to launch full wireless HP Photosmart printer line-up by 2010.

    Threats

    • Projected decreases in the IT markets – Forecasters predict a decrease in the worldwide demand for various IT products offered by HP. The economic slowdown has negatively affected many market segments, including information technology. Hewlett Packard has experienced this decline not only in the U.S. but also in its global markets. Worldwide spending on IT was predicted to decline by 4% in 2009.

    • Hyper-competitive environment – Although Hewlett Packard recently overtook Dell in sales, the latter remains a formidable competitor, as are other companies such as Toshiba, Lenova Group and Aver. It competes in terms of price, quality, brand, technology, reputation, distribution and range of products, among other factors. In some regions, the company faces competition from local companies and from generically-branded or white box manufacturers.

    • Specifically, the company’s competitors in enterprise servers and storage include IBM an in storage there is the EMC Corporation, Dell in industry standard servers and Sun Microsystems in UNIX-based servers. The imaging and printing group’s key competitors include Canon USA, Lexmark International, Xerox Corporation, Seiko Epson Corporation, Samsung Electronics and Dell. HP even faces competition from re-manufacturers including private label brand stores, supply stores such, internet vendors and original equipment manufacturers (OEMs) such as Lexmark. The re-manufacturers buy the original cartridges from customers, refill them with their own ink and resell them at a discount to the branded OEMS. These entities provide a continuous source of competition which could impact the profitability of HP.

    HP is a technology company that operates in more than 170 countries around the world. We explore how technology and services can help people and companies address their problems and challenges, and realize their possibilities, aspirations and dreams. We apply new thinking and ideas to create more simple, valuable and trusted experiences with technology, continuously improving the way our customers live and work. Read more…

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    In addition Hewlett Packard can boast of a 30% of the global server market. Its domination of the global printer market is evidenced by its 40% market share. In 2008 Hewlett Packard took a major step in strengthening its position in the IT services market by acquiring EDS.

    • Prominent Brand Name Recognition – Hewlett Packard is keenly aware of the importance of branding. It has long sought to adjust its brand image as required by changing market forces. In the late nineties it began to shift its image to encompass more than just the business to business segment making adjustments to increase its presence in the consumer market as well. Although business to business sales continue to prevail, the company seeks to exploit its good relationship with retailers. As a result of this strategy many current consumer products are business models stripped of costly features in order to appeal to the needs and pocketbook of the consumer market.

      Hewlett Packard has launched a branding initiative called, “One Voice,” in order to better integrate its line of consumer electronics and computer hardware products. With a fresh design to the packaging, they are striving to on brand across thousands of product lines and dozens of packaging types. The project has resulted in hundreds of thousands of dollars in cost savings by automating package design creation. In addition, the company gained greater consistency in its packaging by providing a system that keeps the company on brand. In 2009 the company moved up from the 12th to the 11th most recognizable brand according to Interbrand.com.

    • Successful Strategic Acquisitions – Hewlett Packard continues its trend of recognizing and capitalizing on strategic acquisitions. The company’s major mergers and acquisitions in recent past include Compaq Computer Corporation in 2002, Mercury Interactive in 2006 and Electronic Data Systems Corporation (EDS) in 2008. In November of 2009, Hewlett Packard announced that it had reached an agreement to acquire 3Com, a provider of computer network equipment, for $2.7 billion in a deal that H.P. plans as a the beginning of an assault on the market leader in networking, Cisco Systems. Computer networking is a $40 billion-a-year market with high profit margins that is growing briskly and dominated by Cisco, which has so far had little head-to-head competition. The company’s successful inorganic growth allows it to increase its competitiveness as well as create value for both investors and customers of the company.

    Weaknesses

    • Weak Market Segment Integration – Although Hewlett Packard is currently addressing its lack of presence in some seemingly obvious segments, there remains room for improvement. The company’s portfolio of offerings lack significant software product or manage consulting services when compared to major competitors including, Accenture, EMC and IBM. For example, both IBM and Accenture are establishing management consulting divisions so as to provide more comprehensive and integrated range of services. Recently, Hewlett Packard has partnered with Thomson eXimius to provide front office processes for private client wealth management firms to support the increasingly sophisticated needs of their customers.

    General Motors SWOT

    SWOT Analysis General Motors

    Introduction

    General Motors is an omnipresent company in the United States, a company so essential to the overall health of the U.S economy that it spawned the phrase “as GM goes, so goes the nation”. Long known for the manufacturing of cars, trucks and automobiles, General Motors has also engaged in finance and insurance.Would you like a lesson on SWOT analysis?

    Opportunities

    • Growth Potential in India and China – There are positive projects for GM business in China and India. In China the market for new cars is in the midst of a 14% growth rate projected to reach over $97 billion in 2008. Meanwhile in India, the market for new cars grew by 15.5% in 2008 to a dollar value of $28 billion. A sign that India will play an even bigger is the projected increase to 2.5 million units by the end of 2013.

    • Increased Global Truck Market – Steady growth rates are projected in the next few years. The market’s volume is expected to rise to 21.5 million units by the end of 2013. The light commercial vehicles segment was the market’s largest in 2008, generating total volumes of 9.8 million units, equivalent to 58.1% of overall value.

    • Rising Demand for Hybrid Vehicles – General Motors produces six hybrid models in the US including the Saturn Vue and Aura Hybrids, Chevrolet Malibu and Tahoe Hybrids, GMC Yukon Hybrid as well as a Cadillac Escalade Hybrid. The company is also investing in hybrid and plug-in vehicles, for both cars and trucks. It is anticipated that GM will produce up to nine hybrid models following the introduction of the Chevrolet Silverado Hybrid and GMC Sierra Hybrid. International demand for light hybrid electric vehicles (HEVs) is expected to increase. It is expected to rise to 800,000 units in 2009 and estimated to reach 4.5 million units in 2013. Therefore, a positive outlook for light hybrid electric vehicles and plug-in vehicles market would boost the demand for GM’s products.

    Threats

    • The Continuing Global Recession – Dire predictions for the global economy were realized in 2009 and stalled economic growth continued into 2010. The economic decline reduced consumer demand for less fuel efficient vehicles, including full size pick-up trucks and sport utility vehicles, which had been GM’s most profitable products. In addition, the economic climate has resulted in tighter credit markets making it harder for consumers to finance automobile purchases.

    • Weakness in Global Automobile Industry – Consumer Requirements for commercial vehicles declined in the NAFTA region, Western Europe and Japan. The Western European automobile markets suffered as well particularly the volume markets of Spain down 28.1%, Italy down 13.4% and the UK down 11.3%. Germany declined 1.8%) and France 0.7% also experienced downward trend in the second half of 2008. In total, 8.4% fewer automobiles were sold in Western Europe. The Japanese car market also declined, with a drop in sales of nearly 4% in 2008.

    • Intense competition – GMs financial status makes it vulnerable to fierce competition from fits such as AB Volvo, Bayerische Motoren Werke, Daimler, Fiat Group Automobiles, Ford Motor, Honda Motor, Hyundai Motor, Isuzu Motors, Mazda Motor, Nissan Motor, PACCAR, PSA Peugeot Citroen, Renault, Toyota Motor and Volkswagen. Many have responded to the crises by adding vehicle enhancements, providing subsidized financing or leasing programs in order to sell more vehicles. They are also offering option package discounts, other marketing incentives and are reducing vehicle prices in certain markets. These actions are expected to have a negative effect on GM’s vehicle pricing, market share and operating results particularly on the low end of the market.

    General Motors, one of the world’s largest automakers, traces its roots back to 1908. With its global headquarters in Detroit, GM employs 204,000 people in every major region of the world and does business in some 140 countries. Read more…

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    However, most recently the global recession has had a devastating impact on its, cash flows, financial condition and operations. To survive, the company has had to accept a government bailout plan and its employees the United Autoworkers of America, has also made concessions. This SWOT analysis is about General Motors.

    Strengths

    • Branding – Born in Detroit Michigan in 1910 General motors has produced a stable of automobiles such as Chevrolet, Pontiac Cadillac and Buick which have become household names in the U.S. As such, the General Motors Brand is well rooted not only in America but throughout the world.

    • Worldwide Presence – General Motors truly has an international presence with factories in Poland, Russia, South Africa Ecuador, Egypt, Germany, Argentina, Australia, Belgium, Brazil, China, Colombia, South Korea, Spain, Sweden, and Thailand. The company is even in Viet Nam. In addition, it also has assembly, manufacturing, distribution, office and warehousing operations in 55 other countries.

    Weaknesses

    • Diminishing Dealer Network – General Motors has compiled a list of more than 1,000 dealerships market for closure. The company has announced that it will not renew its franchise agreements with nearly one quarter of its U.S. dealerships. As of December 31, 2008, GM had 715 dealerships in Canada, as recent as May of 2009 plans called for a anywhere from 40 to 200 closures.

    • Insufficient Liquidity – General Motors has experienced a reduction in liquidity to $14 billion in FY2008 from $27.3 billion in 2007. Losses are attributed to lower sales volumes and a reduction in working capital. Both research and development, as well as relationships with suppliers are negatively affected by the reduced liquidity.

    • Inadequate Performance among Some Business Segments – In 2008 the GME segment accounted to 21.8% of the total revenues and its revenues decreased 8.8% to $32,440 million. Other business segments experiencing declines include GMNA which fell 23.9% to $82,938 million, and GMAP which stood at $12,477 million for FY 2008, a decline of 15%.

    • Low Debt Ratings – Four independent credit rating agencies assess GMs debt ratings and ability to pay interest, dividends and principal on securities. Moodys Investor Service, Fitch Ratings DBRS and Standard & Poors evaluate GM. As of 2008, all four had downgraded their assessment ratings for GM.

    General Electric SWOT

    General Electric SWOT Analysis

    Strengths

    Industry Recognition

    Although it is most prominently known for its products in the consumer & industrial segment with products such as home appliances, refrigerators, freezers, gas ranges, and microwave ovens, General Electric is one of the worlds’ most respected companies in at least a dozen other market segments. Would you like a lesson on SWOT analysis?

    Weaknesses

    Low Debt Ratings

    In January 2009, Moody’s Investment Services placed the long-term ratings of GE and GE Capital on review for possible downgrade. The review of company’s rating for downgrade was primarily due to uncertainty regarding GE Capital’s asset quality and earnings performance in future periods. Further, Standard & Poor’s downgraded the company’s ratings outlook from stable to negative. Lower credit ratings represent higher borrowing costs and reduced access to capital markets for GE. Under debt instrument guarantees and covenants, GE would have to post additional collateral if the ratings were cut below AA-/Aa3 or A-1 and P-1, or four levels, the company said in its annual filings with the U.S. Securities and Exchange Commission

    Substantial Debt Burden

    GE has a high level of indebtedness, which could adversely affect its financial condition and future operations. In 2008, the company’s total debt (short and long term) amounted to $523,762. General Electric’s high debt produces an interest burden which could increase in the period of rising interest rates. In 2008, the interest coverage ratio of the company declined to reach 3.8, as compared to 4.2 in 2007, and 4.5 in 2006. The company’s substantial debt limits its ability to obtain additional financing to fund future working capital, capital expenditures.

    Opportunities

    Increased Demand for Commercial Airplanes

    It is projected that passenger traffic would grow at 4.8% annually till 2027; requiring approximately 28,600 new commercial airplanes to meet the increasing traffic. The commercial airplane market is expected to grow to $2.8 trillion by 2027. By that year, the global commercial airplane fleet is expected to double as compared to the existing fleet size. The Asian-Pacific region is projected to be the largest segment at over 35% of a $2.8 trillion market. General Electric is positioned to take advantage of the projected increased demand. The company’s commercial aircraft financing business owns 1,494 aircraft and its customers include over 230 airlines located in 70 countries. GE’s product inventory includes jet engines, turboprop, turbo shaft engines, and related replacement parts.

    Continued Global Project Opportunities

    General Electric works in more than 100 countries around the world. China leads a long list of international contracting opportunities being developed by GE. In 2008, the company contracted to supply China with equipment for pipeline compression in the country’s natural gas transmissions pipeline. In that same year, General Electric executed an agreement to provide power generation equipment for the Iraqi Ministry of Electricity.
    In addition, it was announced in 2009, that GE had agreed to GE Energy signed an agreement to build a new power technology center in Russia. The company will also deliver 25 new locomotives to Nigeria in 2010. More than half of GEs revenues come from outside the United States, other contracting opportunities will take place in Mexico, South Africa, India, Italy, and Japan.

    Key Acquisition Strategy

    General Electric continues to implement a strategic plan to acquire high margin assets in financial services sectors. Its goal is to develop new customer relationships and deliver more profitable growth for its shareholders. In 2008, GE Capital acquired assets of CitiCapital, a commercial leasing and commercial equipment finance business. Another acquisition reflecting the goal of serving a broader base of customers is the purchase of Kelman of Lisburn, an Ireland company engaged in providing advanced monitoring and diagnostics technologies. Other recent acquisitions include MicroCal, Agility Healthcare Solutions, Vital Signs, and Interbanca.

    Threats

    Environmental and other government regulations

    Many of General Electric’s operations come under the jurisdiction of various federal, state local and even foreign environmental regulations. These governmental entities seek to monitor the adherence to guidelines regarding discharge, treatment, storage, disposal of materials. In 2008, GE incurred mandated remediation expenses equaling $0.3 billion.
    It is anticipated that the company may face ongoing remediation costs averaging $0.35 billion over the next two years. In addition to these costs, government compliance may force the GE to modify its business models and objectives or affect its returns on investment by making existing practices more restricted.

    Projected Labor Cost Increases

    As of July 2009 the U.S. federal minimum wage rate is $7.25 an hour. This increase along with increased overtime, and a higher proportion of full-time employees are resulting in an increase in labor costs, which could have an impact the General Electric’s operational costs.

    In 2009, GE was ranked among the top 10 in Fortune magazine’s listing of the 50 Most Admired Companies in the World, ranked ninth overall, and first in the electronics industry. In addition, 2008 found GE ranked fourth among Business Week’s “World’s Most Innovative Companies”. GE was also ranked 11th in Fast Company’s annual list of the world’s 50 most innovative companies in 2008. A strong recognition across varied categories has ensured its status as one of the strongest players in the industry. Such recognition and respect will further enhance its brand image and gives it a competitive advantage.

    Diversified Product Portfolio

    The company is one most diversified technology, media, and financial services corporations in the world. General Electrics portfolio boasts the following segments: Capital Finance, Commercial lending and leasing products, GE Money Financial Products, Real Estate Capital and Investment Solutions, Energy Financial Services, GE Commercial Aviation Services, Technology Infrastructure, Enterprise Solutions, Healthcare Business, Energy Infrastructure, Oil & Gas business, NBC Universal Broadcasting, and of course the Consumer & Industrial Segment. Such diversity contributes to a well balanced array of revenue streams. In 2008, the company’s largest business division, capital finance accounted for 37.1% of the total revenues, while its technology infrastructure segment contributed 25.6%; energy infrastructure segment 21.4%; NBC universal segment 9.4%; and consumer & industrial segment 6.5%. Such balance has helped General Electric ride out an economic slowdown which has occurred over the last three years.

    Strong Revenue Growth

    General Electric’s Compound Annual Growth Rate increased by 10% from 2006 through 2008 with revenues rising from $151,568 million to $181,515 million. The revenues from its largest business segment, capital finance, increased by 1.1% when compared to FY2007. In addition, revenues from technology infrastructure increased by 8.2%, energy infrastructure 25.6%; while NBC universal grew by 10.1%. This growth is also reflected in key geographic markets, for example, revenue from Europe increased by 10.3% in 2008, revenues from Pacific Basin increased by 8.3%; Americas 17.5%; Middle East and Africa 26.3%; and other global by 17.5%. General Electric expects 2010 to generate solid earnings growth, even if the economic recovery is uneven. The company is optimistic about achieving this growth while generating substantial “free cash” that could further enhance investor returns.

    Fox SWOT

    Fox Entertainment Group SWOT

    Introduction

    William Fox and a group of partners founded the Fox Entertainment Network in 1904.
    After amassing ownership of 25 theaters, the young firm then went through phases of operating as a film exchange, and film rental company and eventually making movies under the name Fox Films in 1915. Would you like a lesson on SWOT analysis?

    Weaknesses

    Over-reliance on reality TV shows

    Fox Entertainment’s are down 6% year-on-year in total viewers and 8% year-on-year in the key adults category 18-49 year olds. The company’s ratings trouble result from too few successful scripted shows and an over-reliance on reality programming. A prime example is its dependence on American Idol to drive higher ratings. The performance of the network’s other reality programs has been very disappointing. This reliance on the reality format is a major weakness which must be addressed or the company risks losing viewers to other networks in search of scripted shows.

    Internal unrest among company leadership

    In 2005 Lachlan Murdoch, Rupert Murdoch’s eldest son, resigned as Deputy Chief Operating Officer following a rift over control of the family empire. Major decisions such as the relocation of the company base from Australia to America have been the source of internal disputes. There were also tensions over the status of Rupert Murdoch’s daughters who were due to take control of the family trust, (which owns 29.5% of News Corporation), following Mr. Murdoch’s death. Continued strife and disputes within the family regarding structure of control and leadership has the potential to destabilize the company’s operations and affect its performance.

    Opportunities

    Stability via long-term contracts

    In February 2006, Fox Sports Network entered into a 10-year deal with the Los Angeles Angels baseball team said to be valued at $500 million. The contract entailed the broadcast of 150 games a season. Angels has been a successful team that had won the 2002 World Series and the 2004 and 2005 American League West championships. Fox’s current licenses with the NFL, MLB, and NASCAR extend until the 2011 NFL season, the 2013 MLB season and the 2014 NASCAR season. These deals have translated into long term stability. In addition, Fox Sports also has had the right to broadcast the National Collegiate Athletic Association’s Bowl Championship Series from 2007 through 2010. The deals with professional sports leagues or organizations spell consistent increases in viewer base and revenues.

    Recent trends in advertising expenditures

    In June of 2010 Fox Broadcasting has launched this year’s television advertising sales season — another sign that companies are stepping up their purchase of television time to pitch their products after two years of cautious spending as a result of the economic downturn. Fox has fewer hours to fill because it programs 15 hours in prime time each week compared with 22 hours by ABC, CBS and NBC. In addition, the network has a stable schedule and big attractions including popular shows like “Glee,” “House” as well as NFL football and next year’s Super Bowl. The company can benefit significantly as prime time advertising rates usually contribute better to the revenues. Fox is expected to pull in about $1.9 billion from advertisers.

    Government mandated broadcasting format

    The FCC and Congress recently mandated that television stations to broadcast exclusively in digital form by 2009. In 2005 Fox Broadcasting Company launched a new digital broadcast system co-designed with IBM, that would help transform high definition (HD) broadcast production. The company is well positioned to capitalize on the shift to digital television. The change presents a significant opportunity for the company to increase viewership and advertising revenues.

    Threats

    Formidable competition

    Several factors related to competition threaten the success of Fox Entertainment. Fox is faced with a large number of formidable competitors such as ABC, CBS and NBC. In addition there is The Walt Disney Company, Viacom Inc, Time Warner and UPN Networks. The impact of competition is exacerbated by the fact that some television competitors have a higher number of affiliates with VHF signals than Fox. Competition could affect the company’s advertising revenues, as advertisers prefer networks with a higher number of affiliates. Furthermore, the company will also have to compete for the acquisition of the broadcasting rights to major events, reducing profit margins for Fox.

    The growing incidence of content piracy

    The proliferation of unauthorized copies and piracy of products has an adverse effect on the firm’s businesses and profitability since the sale of such products reduce the revenue that the company could potentially receive from the legitimate transactions. The creation, transmission and sharing of unauthorized content has had a negative impact on the entertainment industry.

    The company merged with Twentieth Century Pictures in 1935. The company’s name was changed to Twentieth Century Fox. Then the company changed its name to Twentieth Century Fox.

    More recent changes include the News Corporation purchase of Twentieth Century Fox in 1985, the formation of the Fox News Channel in 1996 and The Fox Entertainment Group in 1998.

    Strengths

    Strategically integrated business practices

    Fox Entertainment is an integrated entertainment company engaged in the development, production and worldwide distribution of feature films and television programs. The company also broadcasts television and cable network programming. The company is firmly entrenched in all aspects of the entertainment business. Vertical integration helps the company to generate better profit margins. Examples of this successful strategy include the purchase of Hughes and Direct TV. Fox employees a large number of subsidiaries to help facilitate this strategy.

    Substantial film inventory

    Fox Entertainment produced an average of 26 films per year during the period of 2004 through 2006. Through its subsidiaries such as Twentieth Century Fox, Fox 2000, Fox Searchlight Pictures, and Twentieth Century Fox Animation the company is able to compose a film inventory including League of Extraordinary Gentlemen, Dodgeball: A True Underdog Story, The Devil Wears Prada, and the X Men. Beneficial production partnerships with other businesses such as Universal Studios and Miramax Film have aided this development pace.

    Substantial market size and strength

    The Fox Entertainment company has four business segments and all are major players in their respective business. The company is one of the world’s largest producers and distributors of motion pictures. Fox also owns and operates television stations in nine of the top 10 US markets, including New York, Los Angeles and Chicago. In the sports segment, Fox Sports Net is one of the largest Regional Sports Network (RSN) programmers in the US with stakes in more than 18 networks. Fox Entertainment is itself a subsidiary of the News Corporation. These assets allow Fox to exercise tremendous influence and leverage this power when launching new shows and programs.

    Facebook SWOT

    Facebook SWOT

    Facebook began in 2004. It’s a well-known social networking service which has land grabs at least 850 million users since it began. If you don’t already know, individuals and businesses can signup and create a free profile. You can then upload pictures, as well as contact information and personal information. Famously started by Harvard entrepreneur Mark Zukerberg, the business was floated in 2012. Would you like a lesson on SWOT analysis?

    Strengths

    Facebook has far more than 850 active, regular users. The main benefit of Facebook is that it the brand name that is synonymous with social networking. It’s done a similar thing to Apple and Google in that it’s become a premier brand for a new technology. There is no real competitor to Facebook.

    Weaknesses

    Whilst Facebook has plenty of regular traffic, some would argue that it is becoming mature and that it has acquired most of its potential customer base already.

    Since Facebook is free there is no income stream from subscriptions. Competitors such as LinkedIn does have a subscription approach.

    Some would say that having such a young group of entrepreneurs run a large global business is a potential risk. The market likes to see CEOs over 40.

    Opportunities

    Facebook currently generates revenue through advertising, either CPC or CPM. There is the opportunity to extend this as the business grows.

    New product development with programs such as the new timeline will potentially provide loyal users.

    The expansion of the number of home PCs and mobile devices, such as cellphones, gives Facebook the opportunity to extend its number of users, as well as the amount of usage that they have.

    Threats

    In terms of potential threats to Facebook, there are many other advertising alternatives out there. Some potential advertiser might consider using Google and their Adwords program, or they might decide to use any other media alternative such as good old-fashioned newspaper advertising. The competitive advantage of advertising on Facebook needs to be clearer to the business owner.

    As is often reported Facebook is having a similar history to MySpace. MySpace famously became the premier place to network socially online. Then it became unfashionable and its market share was eroded by businesses such as Facebook only once it had been sold. So there is an element of uncertainty about Facebook and whether it can maintain its fabulous growth into the future.

    eBay SWOT

    SWOT Analysis eBay

    Would you like a lesson on SWOT analysis?

    Strengths.

    • eBay is the leading global brand for online auctions. The company is a giant marketplace used by more than 100 million people to buy and sell all manner of things to each other. Pierre Omidyar, a French entrepreneur, was just 28 when he sat down over a long holiday weekend to write the original computer code for what eventually became an Internet megabrand. The brand has grown tremendously over the decade or so since its conception.

    Opportunities.

    • Acquisitions provide new business strategy opportunities. eBay has agreed to buy online telephone company Skype Technologies in a deal reported to be worth $2.6 billion. Skype’s software lets PC users talk to each other for free and make cut-price calls to mobiles and landlines. eBay has been buying up firms – including payment system PayPal – in an effort to increase the number of services it offers to consumers and keep its profits growing.
    • New and emerging markets provide opportunities (Market Development). Countries include China and India. There, consumers are becoming richer and have more leisure time than previous generations. Aspirating consumers are a growing segment in many developing nations.
    • There are also still opportunities in current markets (Market Penetration). Western Europe and the USA still have many potential consumers that have yet to discover the benefits of online auctions. Remember products have life cycles that eventually come to an end, and such products are ideal for selling and buying on eBay.

    Threats.

    • As with many of the global Internet brands, success attracts competition. International competitors competing in their domestic markets may have the cultural experience that could give them a competitive advantage over eBay. In fact eBay has found that it has met with other USA-based Internet companies when trading overseas. For example, Yahoo! dominates the Japanese market.
    • Attack by illegal practices is a threat. As with weaknesses above, the brand is attacked by unscrupulous individuals. For example e-mails are sent to unsuspecting eBayers pretending to come from eBay. Logos and the design of the pages look authentic. However they are designed so that you input private information that the thieves can use to take passwords and identifications. -so beware!
    • Some costs cannot be controlled by eBay. For example delivery charges and credit card charges. If fuel prices were to rise, the cost is passed on to the consumer in terms of delivery and postal fees. This could make the overall cost of an auctioned item too expensive. Similarly, if a credit card company such as Visa or Mastercard imposed a charge for online transaction, the total cost of the same items would increase with similar consequences.

    Founded in September 1995, eBay (Nasdaq: EBAY) is The World’s Online Marketplace® for the sale of goods and services by a diverse community of individuals and small businesses. Today, the eBay community includes more than a hundred million registered members from around the world. People spend more time on eBay than any other online site, making it the most popular shopping destination on the Internet. Read more…

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    • The company exploits the benefits of Customer Relationship Management (CRM). Buyers and sellers register with the company and data is collected by eBay on individuals. This is the Business-to- Consumer (B2C) side of their business. However the strong customer relationships are founded on a Consumer-to-Consumer (C2C) business model, where strong interrelationships occurs, for example where buyers and sellers leave feedback for each other, and whereby awards are given to the most genuine of eBayers.
    • The term ‘eBay’ has become a generic term for online auctions. Other companies with such a strong position include Hoover for vacuum cleaners, and Google for search engines. Today it is common to hear that someone is ‘ebaying’ or is an ‘eBayer,’ or that someone is going ‘to eBay.’

    Weaknesses.

    • The organizations works tremendously hard to overcome fraud. However, the eBay model does leave itself open to a number of fraudulent activities. Often the company deals with such activities very quickly. Fraud includes counterfeit goods being marketed to unsuspecting (and suspecting!) eBayers. Other forms of theft could include the redistribution of stolen goods. It should be pointed out that fraud and theft are problems with individuals, not eBay. The weakness is that unscrupulous individuals can exploit the C2C business model.
    • As with many technology companies, systems breakdowns could disturb the trading activities of eBay. In the past both eBay and its payment brand Paypal have encountered shutdowns and outages. As technology improves such a weakness is less and less of an issue.

    EA Games SWOT

    EA Games SWOT

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    Strengths

    • Electronic Arts (EA) Games, is a global corporation which develops, markets, publishes and distributes video game software, online interactive games, and mobile games. They design games for a number of platforms including Sony PlayStation 3, Microsoft Xbox 360 and Nintendo Wii; handheld game systems, including PlayStation Portable (PSP), Nintendo DS and Apple iPod; personal computers (PCs); and mobile phones. The company distributes games in over 35 countries worldwide.

    Weaknesses

    • In December 2008, Electronic Arts cut its worldwide workforce by approximately 10% and closed at least nine of its studios and publishing locations. They also laid off 6% of their staff, and let go of Kathy Vrabek, head of EA’s Casual Entertainment division, just 18 months after she took the job.
    • Their software is dependent upon the platforms that are created by other companies, leading to limitations in design capabilities, graphics and game performance.
    • Game release times have to be tied into specific times of year, Christmas sales, sports seasons and major sporting events, any miscalculation of production and distribution further hurts sales, and makes their assets less profitable.
    • In 2008, EA, in a licensing deal with Hasbro, created a digital Scrabble game, which was a failure due in part to software problems.
    • EA’s crown jewel Madden NFL franchise was the company’s only title among the industry’s top 10 best-selling games in 2007.

    Opportunities

    • In 2008, EA acquired ThreeSF, Inc., a gaming-based social network; and they acquired J2MSoft Inc., a Korean-based developer of PC online games.
    • The computer gaming industry has begun to recognize that the U.S. Army needs simulation training and EA Games can provide the instruments to achieve their goals. Games are also being adopted for defense, medicine, architecture, education, city planning and government applications.
    • A line of interactive training tools featuring voice commands and instructional coaching.
    • Complete game-in-a-box containing all the equipment necessary for kids to practice and play a sport.
    • A line of sports toys that will utilize electronics to reward young athletes with cheers when they use proper techniques.
    • A basic line of high density-foam balls to help kids develop skills at an early age.
    • CEO Riccitiello believes EA may one day even go so far as to give away many of its games for free, making its money off action figures and other licensing deals the same way that George Lucas did with the Star Wars movie franchise.

    Threats

    • Since 2004 sales have been steadily increasing, however, profits have been steadily decreasing until 2008, when they actually had a negative profit margin. They earned $3.8 billion in sales, but had a $454 million loss.
    • Sales and profits are dependent on the success and prolonged purchasing power of gaming consoles. If sales for a gaming console wane (such as a Playstation or Wii) software/game sales will slump.
    • Software piracy has become a serious problem, especially in countries, like South Korea where laws are not enforced; software is pirated and distributed without much fear of consequences, cutting into EA Games’ profits.
    • In May 2009, EA Games was sued claiming they illegally used the names and likenesses of thousands of college football and basketball players in their software since the 1990’s.
    • Due to their executive staff layoffs, restructuring, and lack of stability there has been speculation that they are a prime candidate for a takeover by other global entertainment companies.

    References

    Brightman, J. (2009). EA Sports Gets Into Real Life Goods. Retrieved on July 13, 2009.

    CSG Strategies. (2007). Game Impact Theory. Retrieved on July 12, 2009.

    EA Games. (2009). About Us. Retrieved on June 30th 2015.

    Edwards, C. and Vella, M. (2008). EA’s Game Making Plans. Retrieved on July 13, 2009.

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    • EA Games has four segments under their label: EA Games, EA Sports, The Sims and EA Casual Entertainment.
    • The EA Games label has the largest percentage of research and development staff, and produces action-adventure, role playing, racing and combat games and the extraordinarily popular online role-playing games.
    • The EA Sports label produces sports-based video games, including the Madden NFL, (which in 2007 grossed $100 million in sales in their first week on the market), FIFA Soccer and Tiger Woods PGA Tour franchises. The sports division brings in 43% of EA’s revenue.
    • The Sims label is a line extension of life simulation games, and an online interactive game with over four million regular users.
    • The EA Casual Entertainment label develops games that are intended to be quick to learn and play online, making them easily accessible for a wide audience. Pogo has 1.6 million subscribers.
    • In 2007, EA created a strategic alliance with Hasbro, which included crossover licensing. They were able to create digital versions of Hasbro’s classic board games, including Monopoly, Scrabble, Yahtzee, Trivial Pursuit, Nerf, GI Joe, and Littlest Pet Shop. They have also created these digital games in a variety of platforms, including for mobile phones, handheld gaming devices and computers.
    • EA Games has a social responsibility platform that includes a grant program, software donation program, volunteer opportunities, and supporting non-profit organizations and schools by giving to organizations that provide services to underprivileged youth in the areas of math, computer science, music and art.

    Dreamworks SWOT

    DreamWorks SWOT

    Strengths

    Industry Leadership in 3D Film Production

    DreamWorks Animation became the first studio to produce all feature films in 3D from inception, starting with Monsters vs. Aliens, the widest-ever theatrical 3D release. DreamWorks anticipates an even higher level of 3D screen penetration in 2010, when they are slated to release three films, including Shrek Goes Fourth. Would you like a lesson on SWOT analysis?

    Opportunities

    Long Term Distribution Agreements

    DreamWorks Animation SKG has entered into a seven-year distribution agreement with Paramount Pictures for the rights to distribute DreamWorks Animation films in theatrical, home entertainment and television markets on a worldwide basis.

    Key Alliance with Discovery Channel

    Discovery Channel is working to develop a new mini-series project with DreamWorks Television and DreamWorks Animation SKG, Inc. (Nasdaq: DWA) entitled FUTURE EARTH (wt). DreamWorks Television and DreamWorks Animation will co-develop this future project.

    Increased Company Output for 2010

    DreamWorks is looking at a packed schedule for 2010, with seven co-productions in the works (including the Angelina Jolie thriller, Salt) and three of the studio’s own animated films poised for release. Of course, with a gross profit margin of 40.9%, this will result in substantial of earnings for DreamWorks’ investors. Analysts expect earnings per share to rise 35% by the end of 2010.

    Threats

    Competitive Industry Environment

    DreamWorks is seeking to grab customer dollars in an environment which include other hungry competitors such as Disney, Sony, Viacom and Universal Studios. The animated film industry has attracted new entrants also anxious to grab their share of the market.

    The Current Economic Doldrums

    Although the Entertainment Industry is said to be recession resistant, the continued economic slump can slow growth that might otherwise occur. The result is a continued shift in consumer demand away from the entertainment and consumer products as people try to cut frivolous expenditures.

    About DreamWorks

    DreamWorks Animation SKG is devoted to producing high-quality family entertainment through the use of computer-generated (CG) animation. With world-class creative talent and technological capabilities, our goal is to release two CG animated feature films a year that deliver great stories, breathtaking visual imagery and a sensibility that appeals to both children and adults. More . . .

    A Deep Animated Film Inventory

    The strong growth in the animation sector projects a stable demand for DreamWorks’s animation portfolio. The company’s’ substantial animated movie portfolio ensures a revenue growth and market recognition for the company. Entertainment is said to be a recession resistant industry.

    Positive Working Environment

    DreamWorks attracts world-class creative talent, and possesses strong and experienced management team and advanced filmmaking technology and techniques. The company is consistently voted high in Fortune Magazines Top One Hundred Companies to Work For.

    Weaknesses

    Box Office Impact on Market Strength

    Publicly traded entertainment companies often find their stock fortunes rising and falling in accordance with the latest box office results. DreamWorks stock price fell following lower than expected box office revenue for “How to Train Your Dragon”. As of May 18, 2010 stock analyst SmarTrend identified a downtrend for DreamWorks Animation (NASDAQ:DWA). According to SmarTrend, DreamWorks Animation is currently below its 50-day moving average of $40.51 and below its 200-day moving average of $37.21. These moving averages were projected to continue to decline.

    Lack of Diversified Distribution Avenues

    DreamWorks Animation is dependent on Paramount as its sole distributor. In case Paramount fails to perform under either the Paramount Agreements, it could have a material adverse effect on the company’s business reputation, operating results and financial condition.

    DEll SWOT

    SWOT Analysis Dell

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    Strengths.

    • Dell is the World’s largest PC maker. Profits for the 3 months to July 2005 were in excess of $1 billion US, representing a growth of around 28%. For the last couple of years it has held its position as market leader (it took it from rivals Hewlett-Packard). The Dell brand is one of the best known and renowned computer brands in the World.

    Threats.

    • The single biggest problem for Dell is the competitive rivalry that exists in the PC market globally. As with all profitable brands, retaliation from competitors and new entrants to the market pose potential threats. Dell sources from Far Eastern nations where labour costs remain low, but there is nothing stopping competitors doing the same – even sourcing the same or similar components from the same or similar suppliers. Remember, Dell is a PC maker, not a PC manufacturer.
    • Dell, being global in its marketing and operations, is exposed to fluctuations in the World currency markets. Although it is a very lean organization, orders do have to be placed some time ahead due to their size or value. Changes in exchange rates could leave the company exposed to potential loses in parts of its supply chain.

    Dell’s commitment to customer value, to our team, to being direct, to operating responsibly and, ultimately, to winning continues to differentiate us from other companies. The Background section provides critical information and history about Dell’s business world. Read more…

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    • Dell cuts out the retailer and supplies directly to the customers. It uses information technology, and Customer Relationship Management (CRM) approaches to capture data on its loyal consumers. So a customer selects a generic PC model, and then adds items and upgrades until the PC is kitted out to the customer’s own specification. Components are made by suppliers, never by Dell. PC’s are assembled using relatively cheap labour. You can even keep track of your delivery by contacting customer services, based in India. The finished goods are then dropped off with the customer by courier. Dell has total command of the supply chain.

    Weaknesses.

    • The company has such a huge range of products and components from many suppliers from a plethora of countries, that there is the occasional product recall that can cause Dell some embarrassment. In 2004 Dell had to recall 4.4 million laptop adapters because of a fear that they could overheat, causing electric shocks or fires.
    • Dell is a computer maker, not a compute manufacturer. It buys from a group of concentrated hi-tech component manufacturers. Whilst this is a tremendous advantage in terms of business operations, allowing Dell to focus on marketing and logistics, the company is reliant on a few large suppliers, and to an extent is locked in for periods of time (i.e. unable to switch supply dues to the lack of large suppliers in the World).

    Opportunities.

    • Kevin Rollins replaced Michael Dell in 2004 as Dell’s Chief Executive Officer. Dell remained the company’s Chairman. Despite founder Dell’s massive success, new blood and a change in management thinking could lead the company into a new, even more profitable period. Dell was born in 1965, and founded Dell in 1984 with $1000 whilst studying at the University of Texas. He became the youngest Fortune 500 CEO in 1992, and will be a tough act to follow.
    • Dell is pursuing a diversification strategy by introducing many new products to its range. This initially has meant good such as peripherals including printers and toners, but now also included LCD televisions and other non-computing goods. So Dell compete against iPod and other consumer electronics brands.
    • Dell is making and selling low-cost, low-price computers to PC retailers in the United States. The PC’s are unbranded and should not be recognised as being Dell when the consumer makes a purchase. Rebranding and rebadging for retailers, although a departure for Dell, gives the company new market segments to attack with the associated marketing costs.

    Crayola SWOT

    Crayola SWOT – Crayola (Binney & Smith), a subsidiary of Hallmark, Inc.

    Corporate History

    Crayola Manufacturing is a 120 year old company that makes safe, dependable art supplies for children. Because most consumers have never heard of Binney & Smith, the Crayola maker changed its name in 2007 to reflect its brand name. Crayola has many different lines of products; as well as services, which vary from just crayons and markers. Would you like a lesson on SWOT analysis?

    Weaknesses

    • In addition to its inkTank line, Crayola serves the professional market with its Portfolio Series collection of color pencils, oil pastels, and acrylic paints. Because they are most well known for children’s art products, they have yet to achieve high market share in this division, and most art professionals do not use Crayola products.
    • Crayola launched an unsuccessful line of children’s’ clothing in the 1980’s, and it was scaled back to include only newborn layette sets. In 2007 they launched a test market campaign for Crayola branded bottled water, which was also unsuccessful, as consumers were hesitant to buy it because they anticipated that the water would actually taste like crayons (which it didn’t).
    • Also in the late 1980’s sales began to decline due to increased competition and the company began to slip into saturation, they began a campaign to increase demand by urging parents to purchase a "fresh box."
    • Crayola’s attempt to build a solar power plant was sidelined in 2008. They intended the power plant be used to help run their manufacturing facility in Pennsylvania, however, they have run into problems finding partners to make it a reality.
    • Crayola still ranks behind in sales and market share in their marker product line. In 2007, Sanford Sharpie had a 31% market share, with sales (at Wal-Mart) of $56 million, while Crayola had a 22% market share, with sales of $37 million (at Wal-Mart).

    Opportunities

    • In 2009 they introduced two innovative lines of products for babies and toddlers; including products that allow babies to explore colors even before they can use a crayon. The products for toddlers are large enough so that they can grasp them, and even color in the bathtub, which allows for easy clean up, therefore appealing to the primary purchaser, parents.
    • In July 2009 Crayola launched a school social media campaign on Twitter and Facebook. It is geared towards moms (their core purchaser) and features innovative ways to be creative and save money during back to school shopping.
    • In the spring of 2009 they created a summer wellness campaign to encourage children to play outside more.

    Threats

    • With the advent of computers and web based learning, sales of crayons are projected to decrease as children leave behind hand held art supplies at a younger and younger age. It’s called KGOY-kids growing older younger, and many companies have suffered because of it, most recognizable is Mattel, the maker of Barbie dolls. In the 1990’s the average age of a child in their target market was 10 years old, and in 2000 it dropped to 3 years old. As children reach the age of four and five, old enough to play on the computer, they become less interested in toys and crayons and begin to desire electronics such as cell phones and video games. Crayola is slowly falling victim to the same phenomena, how will they innovate to overcome this?
    • In the downturned economy, parents and schools are spending less on school supplies. A survey from Deloitte found that 64% of consumers said they would spend less on school purchases. Nationwide, parents plan to spend an average of $548 to send their children back to school; and estimates range from a decline of 7.7%, forecast by the National Retail Federation, to as much as 12% in 2009, according to America’s Research Group.

    References

    Anonymous. (Jul 28, 2009). Crayola Launches "Creativitycast" Back-to-School Social Media Campaign on Twitter and Facebook. Business Wire. New York

    Baxter, C. (May 7, 2009). Crayola solar project in Forks Twp. stalls: Company says it’s still looking for better partners for field of panels to power its plant. McClatchy – Tribune Business News. Washington.

    Crayola LLC. (2000). Official crayola website. Retrieved June 16, 2009

    Hajewski, D. (2009). Parents spending less on back to school items. McClatchy Tribune News.

    Hallmark Buys Crayola Maker. (August 10, 1984). St. Petersburg Times.

    Hoovers. (2009). Crayola, LLC. Retrieved on August 9, 2009 from ProQuest Database.

    "Top Marker Brands, 2007." MMR, September 2, 2007, p. 22, from Information Resources Inc. Market Share Reporter 2009. Gale, 2009. Reproduced in Business and Company Resource Center. Farmington Hills, Mich.: Gale Group, June 2002

    Perrault and McCarthy. (2004). Chapter 14: Promotion. Basic Marketing: a Global-Managerial Approach. McGraw Hill: New York

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    They produce 3 billion crayons a year, plus craft and character licensed activities. This SWOT analysis is about Crayola. Crayola began as Binney & Smith back in 1885 when Joseph Binney partnered with his son and nephew. Binney and Smith sold their first Crayola crayons in 1903, when a box of eight cost only a nickel. The small business began in New York and moved to Easton, Pennsylvania (where they remain today), producing the dustless chalk. In 1958 the Crayola 64-crayon box, which included 16 new colors and a built-in sharpener, made its debut on the "Captain Kangaroo Show." This Crayola box "became part of the collective history and experiences of generations of Americans, and a symbol of the color and fun of childhood." Crayola estimates that the average U.S. child wears down 730 crayons by age ten. And, in the same spirit, the Smithsonian Institution’s National Museum of American History placed an actual 1958 Crayola 64-crayon box and an assortment of 20th century Crayola advertising in the permanent collection of the Division of Cultural History.

    The company’s products are packaged in many languages and are sold worldwide. Safety in art materials was the main focus for Crayola resulting in non-toxic colors. Crayola also has a creative factory and offers services for creative minds to run free and party space availability with all of their branded products. In 1984 Hallmark purchased Crayola and has kept the company on top of their industry with products ranging on a wide scale from markers, pencils, chalk, watercolors to silly putty and even ornaments and die cast collectables.

    Strengths

    • Crayola is a recognized and highly trusted brand name and logo. In fact, 98 out of every 100 Americans recognize it. Children age 2-10, their target market, love Crayola products and have selective demand for it. Children demand the products and then influence their parents to purchase them. The Crayola brand name is synonymous with high quality and high brand loyalty.
    • They are a global company, with a wide spectrum of individuals who use Crayola products all over the world.
    • Crayola has built up a highly successful distribution system. Their products are available everywhere, including grocery stores, drug stores, Internet sales, hospitals, doctor’s offices, schools, gas stations, airports, theme parks, hotels and restaurants. They sell retail and also in bulk to organizational buyers at a lower cost. Schools all over the US and in other countries like The UK, Canada, Australia, and Mexico all utilize Crayola art materials.
    • Crayola’s website is geared for children, parents, and educators. They provide free ideas for crafts and printable coloring pages. The website is used for booking, ordering, promotional information, marketing, and more. Crayola even provides advice on how to remove stains on their official website.
    • Crayola is well-established due to their innovation (keeping the company out of saturation and decline). Crayola has been in service for many years and knows how to cater to the needs of the consumer. Crayola is constantly building new products and the growth targets many individual needs. Crayola also developed art products that emphasized international diversity by launching Crayola My World multicultural crayons. The company hoped that by using crayons, markers, paints, and modeling compounds that reflected the variety of skin tones, children would build a positive sense of self as well as respect for cultural diversity.
    • Crayola’s price range is reflective of their core target market, middle and lower upper class Americans; and their products are priced competitively with their major competitor, Rose Art. The consumer feels that the price reflects the quality.
    • Crayola uses all non-toxic, child-safe materials that are cost effective and efficient. They use a variety of colors with fun memorable names, which appeal to children and adults. Crayola is environmentally friendly as well. They have scented products for sensory skills. They have easy grip products for motor skills.
    • They have licensing deals with major children’s characters, including all Disney characters, and Nickelodeon characters, which increases their appeal to children.
    • The majority of their retail promotion consists of television commercials, magazine ads, and point of purchase displays. Their promotion impacts and targets children primarily and foremost, however, it is a pull strategy to create an influence purchase by the parents. In most large retail stores, Crayola has their own aisle!

    China Mobile SWOT

    SWOT Analysis China Mobile

    Corporate Overview

    China Mobile Limited was started in 1997. Originally it was called China Telecom (Hong Kong) and then China Mobile (Hong Kong) and finally China Mobile Limited as we know it today. Its public offering in 1997 generated capital of USD $2.5 million, and a further massive investment of global capital (around USD $600 million) was made in 2004. Would you like a lesson on SWOT analysis?

    Weaknesses

    • According to the head of China Mobile, China’s home-grown mobile technology is a few years behind that of its international competitors since it was having problems with handsets. Essentially 3G technology was lagging behind. Part of the problem was the choice to swap to TD-SCDMA’s network which many would consider inferior to the 3G technology offered by European and American alternatives (which their competitors have decided to adopt).
    • The company is not globally diversified. Telecoms companies tend to trade in more than one country, usually through acquisition, joint-ventures or strategic alliances (for example see the SWOT analysis of Bharti Airtel). This may leave the company exposed if the Chinese market were to go into a deep or sustained decline.

    Opportunities

    • The Chinese economy has undergone enormous growth, which has lead to the huge demand for mobile telephones, devices and technologies. According to the Chinese Government, China is the world’s largest mobile market with 520 million mobile phone users. This number could reach 600 million by 2010.
    • Budget users in China are driving growth in the mobile telecoms sector. China Mobile reported a net profit between January and March 2008 of around 24.1bn yuan (£3.4bn; £2.2bn) which is a rise of 37% on 2007 according to BBC News.
    • Since the cities have become saturated, much of the new growth is predicted for rural China and it is this segment that is most likely to be targeted by the large operators. 3G technologies provide the largest opportunity for China Telecom.

    Threats

    • New subscribers are mainly low-use, low-value. So average revenue is falling as the mobile phone market matures and the market becomes more price competitive. So mobile phone suppliers are awaiting the introduction of 3G mobile technologies to rejuvenate the market and stimulate demand as Chinese customers consume the new added value services.
    • China Mobile could face more competition in the future as the Chinese Government plans to allow more operators into the market. China Mobile has 70% of the 2G market in China. China Unicom wants to become the biggest 3G operator, and China Telecom aims to win 15% of the 3G market by 2010.
    • China Mobile has a number of service obligations under agreements with the Chinese (PRC) Government. So the business may be obliged to provide unprofitable services that pay a social dividend. Added to this the Ministry of Information and Industry has allocated a limited frequency (44MHz) to the company which will not support large numbers of subscribers in the future.

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    Today it trades in 31 provinces of China and essentially offers a Global System for Mobile Communications (GSM) which covers almost the entire nation. The business makes money from its voice-based services and other value-added services such as SMS text, mobile e-mail and similar services. This SWOT analysis is about China Mobile.

    Strengths

    • China Mobile was listed fifth in Millward Brown’s Brandz Top 100 Brands in 2007. This would have be unheard of 10 years ago (or even less). The news means that the company is becoming more than a business since it is now also a brand i.e. possessing brand equity and brand value. Other Chinese brands to break the top 100 were the Bank of China, the Chinese Construction Bank and IBBC. It is argued by many that Chinese companies are not strong in relation to marketing but perhaps things are changing.
    • The company has made good profits over recent years.
    • China Mobile has gone down the acquisition trail on a number of occasions. In its early days it took over Jiangsu Mobile (1997). Other important acquisitions include Fujian Mobile, Henan Mobile, and Hainan Mobile (1999); – and Beijing Mobile, Shanghai Mobile, Tianjin Mobile and Hebei Mobile (2000). These developments have delivered strong growth.
    • China Mobile is number one in the Chinese market. It recorded a 67.5% market share in 2006. It is the world’s largest digital mobile company, and serves more customers than any other mobile supplier.

    Carnival SWOT

    Carnival Cruises SWOT

    Company Profile

    Carnival Corporation & PLC is one of the largest global cruise and vacation companies in the world. Carnival primarily operates in North America, UK, Germany, New Zealand, Spain, Brazil and Australia. It is headquartered in Miami, Florida, with another headquarters in London, UK. As of January 2010, the company operated 93 cruise ships. Carnival Cruise Lines was set up as a subsidiary of the American International Travel Service by Ted Arison in 1972. Would you like a lesson on SWOT analysis?

    Opportunities

    • The cruise industry has grown considerably in the past 10 years but still occupies a very small proportion of the global vacation market. Cruise lines accounted for only 4.5% of the $542.2 billion worth of the travel industry in 2009. While the revenue for cruises has declined in the US, it is growing in Europe and Asia, leading to more opportunities for Carnival to expand in these regions.
    • They are planning to increase berth capacity for the European market 37% by 2012.
    • Customers in Asia are now looking for luxurious cruises as a vacation option. Disposable income of the Chinese consumer has grown annually by 10% a year. The total number of passengers sourced from China increased approximately 74% in 2009 so the Costa Classica was launched specifically for this market. They are also planning to introduce the larger cruise liner Costa Romantica in 2010.
    • Trends have shifted in the cruising industry towards the 45-60 year old age group. As this age group grows in population, Carnival can take advantage of the economies of scale and offer them the best prices.
    • In July 2009, Carnival announced the union of Costa Europa with Thomson Cruises, a British Travel Company, under a 10-year bareboat charter beginning in April 2010.

    Threats

    • Carnival has been taking advantage of special tax loopholes to avoid paying US corporation taxes. In 2009 the US government decided to look at closing those loopholes. If these loopholes are closed, it could affect their financial statements and fiscal bottom line in the future.
    • The U.S. Environmental Protection Agency has changed laws to reduce the sulfur content (emission) in fuel oil used aboard ships. This increases the demand for lower sulfur fuel, which raises the prices of the fuel. Carnival may have to deal with a significant increase in fuel prices.
    • In 2009, Carnival experienced bad press when three passengers fell off ships in a three week period. There were a total of 22 incidents of passengers falling overboard in 2009. As of December 2009, Carnival was not required to report such incidents. Such events reflect negatively on the company and the industry.
    • In December 2008, passengers on the Carnival owned Oceania cruise ship were attacked by Somali pirates. The ship sped away and no one was injured, but the threat of terrorism and pirates overtaking cruise ships is a concern for companies in this industry, and also negatively affect consumers’ perceptions of cruising.

    REFERENCES

    Carnival Cruise Lines. (2010). About Us. Retrieved on September 10, 2010 from www.carnival.com

    Datamonitor. (2010). Carnival Information. Retrieved on September 10, 2010 from www.datamonitor.com

    Greenburg, P. (July 2009). Three Passengers Fall Off Carnival Cruise Ships In Three Weeks. Retrieved on September 11, 2010 from http://www.petergreenberg.com/2009/06/17/three-passengers-fall-off-carnival-cruise-ships-in-three-weeks/

    Marketline. (2010). Carnival Company Profile. Retrieved on September 10, 2010 from www.marketlineinfo.com

    Sloan, G. (2008). Cruise ship passengers describe ‘pop, pop, pop’ of gunfire as pirates attacked. Retrieved on September 11, 2010 from http://travel.usatoday.com/cruises/legacy/item.aspx?ak=59427724.blog&type=blog

    They made a number of acquisitions from 1989-2009 increasing the brand portfolio of the company; including Carnival Cruise Lines, Princess Cruises, Holland America Line, ibero Cruises, Costa Cruises, P&O Cruises, AIDA Cruises, Cunard Line, P&O Cruises Australia, Ocean Village and The Yachts of Seabourn. This SWOT analysis is about Carnival.

    Strengths

    • Carnival is one of the world’s largest cruise operators, has a large fleet capacity and operates 11 of the most recognizable cruise brand names. Their portfolio of brand names appeals to almost every niche market, from budget minded, contemporary to luxury cruises.
    • They are such a large company that they have significant cost advantages over most of their competitors.
    • Carnival is one of the profitable cruising companies. The company’s average net income (FY2005 to FY2009) amounted to 18.1% compared to the industry standard of 6.3%.
    • Carnival aggressively and effectively invests in print and television media. Their promotions target the lifestyles of each group of customers. Carnival are “Fun Ships” Holland America, a premium cruise, is promoted through the tagline “a signature of excellence” Seabourn, projects itself as “intimate luxury” while the Ocean Village projects as “the cruise for people who don’t do cruises”.
    • Carnival has a 47% market share in the UK, 68% in Italy, 51% in Germany and 45% in France.

    Weaknesses

    • The net profit was $1,790 million in FY2009, a decrease of 23.2% as compared to 2008.
    • Carnival derives a majority of its revenue (nearly 52%) from US customers. In 2009 the revenue from the North American market registered a double digit decline. The over-dependence on the US market makes Carnival vulnerable to the economic fluctuations of the American economy and this company is dependent on customers’ disposable income.
    • Another weakness is that Carnival reports their financial statements in dollars. About half of their revenue is generated in a non-US currency, but is reported in terms of US dollars. The value of the dollar against Euro appreciated from 1.60 in January 2010 to 1.53 by April 2010 against the Pound. If the dollar strengthens it would record a lower revenue than is actually earned.
    • In the middle of economic uncertainty Carnival has 13 ships under construction as of November 2009, and the estimated cost of all this growth is around $8.2 billion. It is difficult at best to justify such a huge cash outflow in the middle of economic instability. This may result in consequences like huge debt burden on the balance sheet and reduced profitability.

    Burger King SWOT

    Burger King SWOT

    Would you like a lesson on SWOT analysis?

    Strengths

    Geographic Diversification

    Burger King has over 11,500 fast food restaurants located in over 70 countries. 7,207 of its restaurants are located in the United States (62%) and another 4,358 are established in international locations (389%) such as Asia, the Middle East, Africa and Canada.

    Opportunities

    New Breakfast Food Initiative

    Burger King is seeking to overhaul its breakfast menu and will add Starbucks Corp.’s Seattle’s Best Coffee to all its U.S. restaurants. It has introduced earlier restaurant opening times in its United Kingdom locations.

    New Healthier Menu Items

    Burger King sponsoring its biggest new product launch in years by introducing the Tendercrisp, Premium Chicken Burger and accompanying the launch with a marketing campaign called “cheat on beef”.

    National Urban Community Marketing Initiative

    Burger King is seeking to strengthen its standing in the African American Community through its new “next best move” promotion which includes a well publicized tour of 41 urban communities across the country.

    Brand Licensing Project

    Burger King has entered into a licensing arrangement (brokered by Broad Street Licensing Group) to further increase the company’s’ brand awareness and broaden the presence of the iconic “King” character, various licensees of Burger King Corp. will soon launch a line of branded T-shirts, and also an exclusive collection of sleepware and lounge ware.

    Threats

    Unrest among Franchisees

    Burger Kings’ new dollar cheese burger initiative and loss leader strategy has upset some of its franchise owners who feel the pricing violates the franchise agreement. The dispute spurred the National Franchisee Association to file a lawsuit against the company. In 2009 Franchisees voted twice against the new promotions. The company reportedly has dropped the $1 burger promotion, but there may be bad feelings lingering for a while.

    The Slow Recovering Economy

    The challenging global economy continues to hamper the company’s financial strength (ranked 238th among its peers). Burger King posted weaker-than-expected quarterly results in the last half of 2009, and missed stock analysts’ expectations. The decline was driven in part by continued adverse macroeconomic conditions, including record levels of unemployed.

    Changing Consumer Eating Habits

    Burger King’s same-store sales in the U.S. and Canada declined 4.6% in the three months ended Sept. 30, 2009. People 18 to 34 cut their consumption of fast-food meals from November 2006 to November 2009 according to the market-research firm NPD Group. The combination of the economy and better health information has influenced people to eat at home and to opt for leaner lower calorie foods. More . . .

    Established Market Share

    Among Fast Food restaurant chains, Burger King is second only to McDonalds and holds a 15% share of the United States market. The company’s profitability has also increased in recent years. In the period 2006-08, its operating profit has increased from $170 million in FY2006 to $354 million in FY2008.

    Globally Recognized Brand

    Burger King is able to boast a brand that is widely recognized thanks to its flagship slogan “have it your way”, the whopper sandwich and most recently enhanced by its mascot known as “the King”. The company was recently ranked 7th in brand awareness.

    Superior Growth Plan

    Approximately 90% of Burger King Restaurants are owned and operated by independent franchisees, many of them family-owned units that have been in business for decades. The company is able to grow while minimizing large capital expenditure, meanwhile it collects fees and royalties from each franchise added.

    Weaknesses

    Vulnerability to Labor and Regulatory Influences

    Although the company operates in many international venues, the majority of restaurants are in the United States. This concentration of operations in one geographic area increases company’s exposure to local factors such as labor strikes and the influence of regulatory changes.

    Reliance on so-called “Super Customers”

    There is some indication that Burger King may have been slow to transition to leaner and healthier restaurant fare in favor of pleasing its long term customers who are fans of the big larger portion sandwiches.

    Bharti Airtel SWOT

    SWOT Analysis Bharti Airtel

    Would you like a lesson on SWOT analysis?

    Strengths

    • Bharti Airtel has more than 65 million customers (July 2008). It is the largest cellular provider in India, and also supplies broadband and telephone services – as well as many other telecommunications services to both domestic and corporate customers.

    Opportunities

    • The company possesses a customized version of the Google search engine which will enhance broadband services to customers. The tie-up with Google can only enhance the Airtel brand, and also provides advertising opportunities in Indian for Google.
    • Global telecommunications and new technology brands see Airtel as a key strategic player in the Indian market. The new iPhone will be launched in India via an Airtel distributorship. Another strategic partnership is held with BlackBerry Wireless Solutions.
    • Despite being forced to outsource much of its technical operations in the early days, this allowed Airtel to work from its own blank sheet of paper, and to question industry approaches and practices – for example replacing the Revenue-Per-Customer model with a Revenue-Per-Minute model which is better suited to India, as the company moved into small and remote villages and towns.
    • The company is investing in its operation in 120,000 to 160,000 small villages every year. It sees that less well-off consumers may only be able to afford a few tens of Rupees per call, and also so that the business benefits are scalable – using its ‘Matchbox’ strategy.
    • Bharti Airtel is embarking on another joint venture with Vodafone Essar and Idea Cellular to create a new independent tower company called Indus Towers. This new business will control more than 60% of India’s network towers. IPTV is another potential new service that could underpin the company’s long-term strategy.

    Threats

    • Airtel and Vodafone seem to be having an on/off relationship. Vodafone which owned a 5.6% stake in the Airtel business sold it back to Airtel, and instead invested in its rival Hutchison Essar. Knowledge and technology previously available to Airtel now moves into the hands of one of its competitors.
    • The quickly changing pace of the global telecommunications industry could tempt Airtel to go along the acquisition trail which may make it vulnerable if the world goes into recession. Perhaps this was an impact upon the decision not to proceed with talks about the potential purchase of South Africa’s MTN in May 2008. This opened the door for talks between Reliance Communication’s Anil Ambani and MTN, allowing a competing Inidan industrialist to invest in the new emerging African telecommunications market.
    • Bharti Airtel could also be the target for the takeover vision of other global telecommunications players that wish to move into the Indian market.

    Airtel comes to you from Bharti Airtel Limited, India’s largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. The businesses at Bharti Airtel have been structured into three individual strategic business units (SBU’s) – Mobile Services, Airtel Telemedia Services & Enterprise Services. Read more…

    Bibliography

    Bharti Airtel – Rider of the boom – Rishi Joshi and Amit Mukherjee, Business Today 5th March 2008

    Bharti Airtel’s Website

    Wiki – Bharti Airtel

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    • Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia – and Sing Tel, with whom they hold a strategic alliance. This means that the business has access to knowledge and technology from other parts of the telecommunications world.
    • The company has covered the entire Indian nation with its network. This has underpinned its large and rising customer base.

    Weaknesses

    • An often cited original weakness is that when the business was started by Sunil Bharti Mittal over 15 years ago, the business has little knowledge and experience of how a cellular telephone system actually worked. So the start-up business had to outsource to industry experts in the field.
    • Until recently Airtel did not own its own towers, which was a particular strength of some of its competitors such as Hutchison Essar. Towers are important if your company wishes to provide wide coverage nationally.
    • The fact that the Airtel has not pulled off a deal with South Africa’s MTN could signal the lack of any real emerging market investment opportunity for the business once the Indian market has become mature.

    Ben and Jerry’s SWOT

    Ben and Jerry’s SWOT

    Would you like a lesson on SWOT analysis?

    Strengths

    • Prestigious, established, successful, global operation, with sales in USA, Europe and Asia, which is synonymous with social responsibility and environmentalism. For example, its products are packed in unbleached cardboard containers.
    • Ben & Jerry’s also donates a minimum of $1.1 million of pretax profits to philanthropic causes yearly. The company sponsors PartnerShops, which are Ben & Jerry outlets independently owned and operated by nonprofit organizations such as Goodwill Industries. The company is also involved in other good causes, including global warming, gun control and saving family farms.

    Weaknesses

    • In 2006, former CFO Stuart Wiles was convicted of embezzling some $300,000 from the company during his tenure at Ben & Jerry’s, which ran from 2000 to 2004.
    • In 2006 they had to stop using Michael Foods as their egg supplier, due to bad PR from the Humane Society, which alleged that Michel Foods treated chickens inhumanely.
    • They achieved success despite several corporate weaknesses. The most obvious was a lack of professionalism in its management, and no clear mission statement (which they have amended). They reinvested huge amounts of property and equipment in 1994 increasing their long-term debts by almost 45% in 1993. They increased marketing and selling expenses and administrative infrastructure, which increased 28% to $36.3 million in 1994 from $28.3 million in 1993 and increased as a percentage of net sales to 24.4% in 1994 from 20.2% in 1993. They took out a vast amount of capital lease in their aim to automate their production to keep up with the intense competition.
    • Their clear focus on multiple social responsibility issues could hurt the company by shifting the focus away from important business matters, and also add unnecessary costs.
    • They need more experienced management to fuel aggressive growth in a downturned economy and change flat sales in their premium product lines.

    Opportunities

    • In today’s health conscious societies the introduction of more fat-free and healthy alternative ice cream and frozen yogurt products.
    • Provide allergen free food items, such as gluten free and peanut free.
    • In 2009 Ben & Jerry’s announced plans to roll out the country’s first HFC-free freezers; freezers that would be sold to grocery stores and would not emit harmful chemicals into the atmosphere.
    • In 2008 they acquired Best foods and Slim-fast which will allow them to enter a new industry of weight loss products. In turn they can now expand into new geographic markets-more countries, like Europe, where the weight loss/management trend is taking hold.
    • They could expand their existing product lines to compete with the ‘private-in house brands’ offered by supermarkets, and in developing countries.
    • Selling Ben and Jerry’s premium ice cream in South America (which is an emerging market that has yet to be capitalized upon). There is a growing demand for premium ice cream in new markets like Asia.

    Threats

    • Much of their target market is constantly changing its product preferences (desiring to prevent diabetes, obesity etc.). That, coupled with a decrease in household sizes and discretionary income, has left sales flat in recent years.
    • Consumers are concerned about fattening dessert products. Especially Ben and Jerry’s target market, which are accustomed to reading nutrition labels.
    • Any contamination of the food supply, especially e-coli.
    • Major competitors, like Nestle (Pillsbury), Kraft Foods, Dunkin Donuts, and Dean Foods. They also have competition from global food companies with similar products and any grocery store label products. Much of their competition seems to be merging together, in order to remain marketable in this tough economy.
    • Experts say that animal feed prices are rising, partly because biofuel crops are replacing cow fodder. In turn, the high priced animal feed pushes up the cost of milk. Prices of all milk products are rising worldwide, due to what some call a "perfect storm" of low supply and high demand. There is a distinct possibility that their may not be enough milk to meet demand, and that there could be a global milk shortage.
    • Agricultural economists say today’s milk shortage is basically a case of low supply and high demand worldwide. Supply is down for many reasons. A bad drought in Australia dried up the grass that the country’s cows eat. New export taxes were added on Argentina’s milk in an attempt to keep the country’s food prices under control. Also, European farmers can’t significantly increase production until a quota system is phased out eight years from now. The U.S. and Europe always used to have spare dairy products to sell cheaply around the globe, but that’s no longer the case, says market expert Erhard Richarts.
    • Skim Milk powder (which is easier to transport than fresh milk) is used in a wide range of foodstuffs, and in 2007 its price shot up to record levels worldwide – almost twice as high as the year before. Then retail prices went up, a butter shortage, cheese prices went up, and then wholesale prices went up, and there doesn’t seem to be an end to it.

    Back in ’66, in a school gym class, Ben Cohen and Jerry Greenfield found they hated running but loved food. Years later in ’78, Ben had been fired from a series of jobs while Jerry had failed for the second time to get into medical school. Read more…

    • The company sells its colorfully named ice cream, ice-cream novelties, and frozen yogurt under brand names such as Chunky Monkey, Phish Food, and Cherry Garcia. It also franchises some 750 Ben & Jerry’s Scoop Shops worldwide.
    • Ben and Jerry’s were bought by consumer products manufacturer Unilever in 2000, but were still able to retain their social responsibility platform and kept both co-founders closely involved with product development. Their brands complement Unilever’s existing ice cream brands.
    • In 2009 Ben and Jerry’s Chunky Monkey ice cream flavor was named in a top ten list of the best ice cream in London.
    • In 2007 Ben and Jerry’s co-founders, Ben Cohen and Jerry Greenfield were asked to join Lance Armstrong in speaking about clean technology and alternative energy at the Ernst and Young national entrepreneur of the year awards.
    • In 2008, their market share was second only Haagen-Dazs who had a 44% market share while Ben and Jerry’s had 36%. This was achieved in spite of a premium price point. The premium price of the product was supported by a high quality image, and high quality products.

    Audi SWOT

    SWOT Analysis Audi

    Audi began in Germany in 1932. It was formed from the merger of four different carmakers. In 1969 Volkswagen acquired the business. In 2008 Audi delivered more than 1 million cars to customers Today the business goes from strength to strength and manufacturers in many parts of the world, including India. This is a smanufacturer of very high quality cars which tend to be highly engineered, robust and priced at a premium level. Would you like a lesson on SWOT analysis?

    Opportunities

    Without a doubt the new emerging markets of China and India are huge opportunities for Audi. New car sales are growing in both countries as consumers are getting wealthier and more discerning, they need status brands such as Audi. By 2015, the Indian car market is going to be huge, with estimated sales reaching more than $40 billion. In China figures indicate that sales will be in excess of 250,000 million vehicles in a similar period of time.

    Audi with its innovative history is obviously investing heavily in vehicles which are low emission and will be targeted at the greener car market. Hybrid electric vehicles (HEVs) will become very popular in the large countries of the United States and China, whereby petrol stations will become slowly replaced by plug-in stations. So obviously the growth of environmentalism and the nature of global warming mean that consumers are calling for low emissions alternatives.

    Hopefully in the coming years, the global car market will begin to recover and car sales and production will increase. There are a number of drivers. Government programs which offer incentives to consumers to ditch their old gas guzzler to replace it with a modern hybrid car for example, mean an increase in sales. The problems associated with raising credit in Western nations will hopefully disappear and consumers will begin to take loans to finance their vehicle again. Audi has become a leaner business by increasing its profit per vehicle and reducing its inventory.

    Threats

    Like any business which operates in a global economic environment, Audi has to deal with local business environments. For example, regulations by local governments in relation to emissions or safety, or even strategic alliances with local companies in order to enter a market, such as China. All please add to the bottom line and reduce margins potentially.

    Trading in a global market means that the business is essentially exposed to commodity price fluctuations. Steel prices have been on a helter-skelter. Commodity prices vary, and it makes it difficult for Audi to keep costs steady.

    In the car industry, generally, the largest threat relates to the nature and level of competition in what is a mature industry. There are a number of similar brands including BMW and Mercedes. Car production globally tends to move where the high dependence on labour cannot impact its cost base, so over years to come more manufacturing will move to India and China, where costs of labour are lower. The German worker is comparatively expensive.

    Strengths

    Audi’s reputation is undoubtedly based upon a very strong brand. In fact the four rings of Audi is one of the most identifiable logos and images globally. The brand is very innovative and the range is continually developed and extended.

    Being a German technology product, obviously Audi has a reputation for operations management and its production approaches. The company manufactures in excess of 1 million autos a year. Interestingly, more than 1000 of these cars are Lamborghinis, Audi’s premium supercar brand. The company manufactures cars in the German cities of Ingolstadt and Neckarsulm.

    Audi is also renowned for technology, creativity and innovation. The business invests almost $3 billion every year in research and development for its new products. Historically, the company’s innovations are quite impressive – for example, Audi Quattro’s four-wheel-drive technology. New innovations include light emitting diode headlights (you may have seen them on the highway) and also MultiMedia Interface (MMI), which is a mash up of entertainment technology, navigation technology, and communication technology – including telephones as well as other innovations, which also improve passenger safety.

    Weaknesses

    One interesting problem for the business is that whilst it is a very large vehicle manufacturer, it doesn’t operate on the same huge scale as some of its close competitors, including Ford and Toyota. A simple revenue analysis based upon units produced shows that its competitors can make equivalent vehicles more cheaply, simply because of economies of scale. That is to say relative unit costs are higher.

    Audi’s are German and its brand is associated with its national identity. Whilst in some ways this is a strength, others might view this as a particular issue. The brand is very dependent upon its European markets. It is relatively small in North America. Some of the sustained sales in Europe have to be due to environmental initiatives and incentives offered by European governments, and this won’t go on forever. The European market might also go into decline, simply because of the debt being experienced by large markets such as the Greece, Ireland and Spain.

    In common with some of its competitors including Toyota, Audi has also had to endure the embarrassment of product recalls. Especially for a brand which encompasses security and safety, this could potentially be damaging. In North America, there have been problems with gearboxes (transmissions) . Similar problems occurred in the South Korean market.

    Apple SWOT


    SWOT Analysis Apple

    Strengths.

    • Apple is a very successful company. Sales of its iPod music player had increased its second quarter profits to $320 (June 2005). The favourable brand perception had also increased sales of Macintosh computers. So iPod gives the company access to a whole new series of segments that buy into other parts of the Apple brand. Sales of its notebooks products is also very strong, and represents a huge contribution to income for Apple. Would you like a lesson on SWOT analysis?
    • In 2005 Apple won a legal case that forced Bloggers to name the sources of information that pre-empted the launch of new Apple products. It was suspect that Apple’s own employees had leaked confidential information about their new Asteroid product. The three individuals prosecuted, all owned Apple tribute sites, and were big fans of the company’s products. The blogs had appeared on their sites, and they were forced to reveal their source. The ruling saw commercial confidentiality as more important as the right to speech of individuals. Apple are vulnerable to leaks that could cost them profits.

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    • Brand is all-important. Apple is one of the most established and healthy IT brands in the World, and has a very loyal set of enthusiastic customers that advocate the brand. Such a powerful loyalty means that Ample not only recruits new customers, it retains them i.e. they come back for more products and services from Apple, and the company also has the opportunity to extend new products to them, for example the iPod.

    Weaknesses.

    • It is reported that the Apple iPod Nano may have a faulty screen. The company has commented that a batch of its product has screens that break under impact, and the company is replacing all faulty items. This is in addition to problems with early iPods that had faulty batteries, whereby the company offered customers free battery cases.
    • There is pressure on Apple to increase the price of its music download file, from the music industry itself. Many of these companies make more money from iTunes (i.e. downloadable music files) than from their original CD sales. Apple has sold about 22 million iPod digital music players and more than 500 million songs though its iTunes music store. It accounts for 82% of all legally downloaded music in the US. The company is resolute, but if it gives in to the music producers, it may be perceived as a commercial weakness.
    • Early in 2005 Apple announced that it was to end its long-standing relationship with IBM as a chip supplier, and that it was about to switch to Intel. Some industry specialists commented that the swap could confuse Apple’s consumers.

    Opportunities.

    • Apple has the opportunity to develop its iTunes and music player technology into a mobile phone format. The Rokr mobile phone device was developed by Motorola. It has a colour screen, stereo speakers and a advance camera system. A version of Apple’s iTunes music store has been developed for the phone so users can manage the tracks they store on it. Downloads are available via a USB cable, ands software on the handset pauses music if a phone call comes in. New technologies and strategic alliances offer opportunities for Apple.
    • Podcasts are downloadable radio shows that can be downloaded from the Internet, and then played back on iPods and other MP3 devices at the convenience of the listener. The listener can subscribe to Podcasts for free, and ultimately revenue could be generated from paid for subscription or through revenue generated from sales of other downloads.

    Threats.

    • The biggest threat to IT companies such as Apple is the very high level of competition in the technology markets. Being successful attracts competition, and Apple works very hard on research and development and marketing in order to retain its competitive position. The popularity of iPod and Apple Mac are subject to demand, and will be affected if economies begin to falter and demand falls for their products.
    • There is also a high product substitution effect in the innovative and fast moving IT consumables market. So iPod and MP3 rule today, but only yesterday it was CD, DAT, and Vinyl. Tomorrow’s technology might be completely different. Wireless technologies could replace the need for a physical music player.

    Amazon SWOT

    SWOT Analysis Amazon

    Amazon is a profitable organization. In 2005 profits for the three months to June dipped 32% to $52m (£29.9m) from $76m in the same period in 2004. Sales jumped 26% to $1.75bn. Until recent years Amazon was experiencing large losses, due to its huge initial set up costs. The recent dip is due to promotions that have offered reduced delivery costs to consumers. This SWOT analysis is about Amazon.

    Opportunities.

    • The company is now increasingly cashing in on its credentials as an online retail pioneer by selling its expertise to major store groups. For example, British retailer Marks and Spencer announced a joint venture with Amazon to sell its products and service online. Other recent collaborations have been with Target, Toys-R-Us and the NBA. Amazon’s new Luxembourg-based division aims to provide tailored services to retailers as a technology service provider in Europe.
    • There are also opportunities for Amazon to build collaborations with the public sector. For example the company announced a deal with the British Library, London, in 2004. The benefit is that customers c an search for rare or antique books. The library’s catalogue of published works is now on the Amazon website, meaning it has details of more than 2.5m books on the site.
    • In 2004 Amazon moved into the Chinese market, by buying china’s biggest online retailer, Joyo.com . The deal was reported to be worth around $75m (£40m). Joyo.com has many similarities to its new owner, in that it retails books, movies, toys, and music at discounted prices.

    Threats

    • All successful Internet businesses attract competition. Since Amazon sells the same or similar products as high street retailers and other online businesses, it may become more and more difficult to differentiate the brand from its competitors. Amazon does have it s brand. It also has a huge range of products. Otherwise, price competition could damage the business.
    • International competitors may also intrude upon Amazon as it expands. Those domestic (US-based) rivals unable to compete with Amazon in the US, may entrench overseas and compete with them on foreign fronts. Joint ventures, strategic alliances and mergers could see Amazon losing its top position in some markets.
    • The products that Amazon sells tend to be bought as gifts, especially at Christmas. This means that there is an element of seasonality to the business. However, by trading in overseas markets in different cultures such seasonality may not be enduring.

    Disclaimer:
    This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

    Strengths.

    • Amazon is a profitable organization. In 2005 profits for the three months to June dipped 32% to $52m (£29.9m) from $76m in the same period in 2004. Sales jumped 26% to $1.75bn. Until recent years Amazon was experiencing large losses, due to its huge initial set up costs. The recent dip is due to promotions that have offered reduced delivery costs to consumers.
    • Customer Relationship Management (CRM) and Information Technology (IT) support Amazon’s business strategy. The company carefully records data on customer buyer behaviour. This enables them to offer to an individual specific items, or bundles of items, based upon preferences demonstrated through purchases or items visited.
    • Amazon is a huge global brand. It is recognisable for two main reasons. It was one of the original dotcoms, and over the last decade it has developed a customer base of around 30 million people. It was an early exploiter of online technologies for e-commerce, which made it one of the first online retailers. It has built on nits early successes with books, and now has product categories that include electronics, toys and games, DIY and more.

    Weaknesses.

    • As Amazon adds new categories to its business, it risks damaging its brand. Amazon is the number one retailer for books. Toy-R-Us is the number one retailers for toys and games. Imagine if Toys-R-Us began to sell books. This would confuse its consumers and endanger its brands. In the same way, many of the new categories, for example automotive, may prove to be too confusing for customers.
    • The company may at some point need to reconsider its strategy of offering free shipping to customers. It is a fair strategy since one could visit a more local retailer, and pay no costs. However, it is rumoured that shipping costs could be up to $500m, and such a high figure would undoubtedly erode profits.

    Marketing Teacher’s Strategy Page


    Marketing Teacher’s Strategy Page

    A selection of well known tools for deciding strategy

    Why People Buy

    Consumer Behaviour

    Why People Buy

    Marketers spend millions of dollars trying to understand why people buy products and services. Sometimes it seems that there is no reason for a purchase, but in reality there is always a reason. Many factors are involved in a customers’ buying decision, any one of which can become the deciding factor, such as:

    • Conspicuous consumption: Lavish spending for the purpose of displaying wealth or social status; preference for buying increases with price.
    • Snob effect: Desire to buy something nobody else has; preference for buying increases with rarity or scarcity.
    • Bandwagon effect: Desire to buy something everybody else is buying; preference for buying increases with perceived popularity.
    • Economic-To enhance their lifestyle or to fulfill two of Maslow’s needs: physiological (food, shelter) and Safety and Security.
    • Psychological-This is the study of how people interact with their environment, products are consumed to enhance their well being, for example air fresheners, furniture and convection ovens.
    • Sociological-The study of the thoughts, feelings, and behaviors of group interaction, especially in a social setting. People want to feel accepted and loved by their peers and they need to consume products that will appeal to their chosen groups. For example a consumer wants to join a kayaking team would have to purchase the proper gear, clothing and maybe even music genre in order to fit in with the group.
    • Practical-Consumers purchase products because they need them to survive, such as shoes and medicine.
    • Impractical-is the opposite of practical, purchasing products that are not necessary.
    • Rational-Purchases are made with logical, thought out reasoning.
    • Irrational-products are purchased for foolish or absurd reasons.
    • Factual-Purchasing products based on researched reports.
    • Emotional-purchasing products based on feelings
    • Buy to satisfy a need (for a reason).
    • Buy to satisfy a want (desire).

    Consumers Also Buy:

    Why People Buy
    Why do people buy?

    To Increase

    • Sales.
    • Profit.
    • Satisfaction.
    • Confidence.
    • Convenience.
    • Pleasure.
    • Production.

    To Protect

    • Investment
    • Self
    • Employees
    • Property
    • Money
    • Family

    To Make

    • Money
    • Satisfied customers
    • Good impressions

    To Improve

    • Customer relations
    • Employee relations
    • Image
    • Status
    • Earnings
    • Performance

    To Reduce

    • Risk
    • Investment
    • Expenses
    • Competition
    • Worry
    • Trouble

    To Save

    • Time
    • Money
    • Energy
    • Space

    What is a customer?

    What is a customer?

    In marketing we tend to use the word customer / customers and consumer almost interchangeably. However our customer and the consumer are not strictly speaking the same. A customer is a person or company who purchases goods and services. A customer becomes a consumer when he or she uses the goods or services i.e. where there is some consumption.

    Customers categorised

    Customers can be categorised as B2C which stands for Business-to-Customer (B2C) for example where you buy sweets from a shop, Business-to-Business (B2B) where the shopkeeper uses the services of an accountant to write his tax return, C2B which is Customer-to-Business (C2B) for example where an individual sells his gold watch to a jewellery store and C2C or Customer-to-Customer (C2C) where customers sell goods to each other. A great example for C2C is eBay, where consumers sell goods to other consumers.

    A Marketing Oriented Approach

    A marketing orientation underpins our focus on the customer/consumer and their needs and wants. Our marketing orientation occurs as a result of all of the people from within our business from the managing director to the receptionist making the satisfaction of customer needs and wants their whole reason for being. Now let’s take a look at how we find information that will shed light on what our customers and consumers need and want. The benefits of a marketing orientation centre on the fact that customers can be grouped into segments and segments can deliver profits to the organisation. Customers also need information about products and services, and how to use them.

    Therefore we can define a consumer as an individual who (buys and) uses a product or service. So the consumer could be the customer that goes into the shop to buy the sweets. However the final consumer may not always be the customer. For example, a parent goes into the sweet shop and buys some sweets. He or she does not eat them, and so they are not the consumer. The child would eat the sweets and be the consumer, although he or she did no buy the sweets and so they are not the initial customer.

    The reason we need to know the difference between a consumer and the customer is that we will want to design communications and understand the consumer behaviour of the person that instigates and influences a buying decision as well as the final consumer. For example the child will influence the mother’s decision on which sweets to buy. However it can be much more subtle, for example a wife might influence the clothing choices of her husband, or a child might influence the family’s choice of a holiday destination.

    Customer needs and wants.

    Obviously the terms customer and consumer are often interchanged. So with a definition of marketing, we will aim to anticipate the needs and wants of consumers and/or customers. Needs and wants may differ. So let’s return to our mother and her child, since a mother may wish to feed her child nutritious food at mealtimes, the child may wish to eat sugary and less healthy food. The mother is the customer and she purchases based upon her need, whereas the child is the final consumer and he or she may focus on what they want. So needs and wants may differ between customers and consumers.

    Value Curves


    Value Curves

    Blue Ocean Strategy

    The term value curve appears in three key Harvard Business Review articles by W. Chan Kim and Renee Mauborgne, as well as their 2005 book – Blue Ocean Strategy. The value curve is a tool for strategic managers to see visually how their strategy works in relation to close competitors.

    It is not the same as a value chain since it does not focus upon internal sources of value, more so what our customers value from our products and services marketing. However value curves and value chains can be used in conjunction – bridging the internal value creation with the external factors of competition valued by our customers.

    Value Curve

    This lesson is based upon Charting Your Company’s Future (Chan Kim and Mauborgne 2002). There is an argument that more traditional strategic planning frameworks work sometimes, whereas on some occasions they don’t. A traditional standard planning framework ultimately ends up as a document, having gone through a series of steps. Instead managers decide upon a strategy canvas – which has three stages. Firstly managers decide upon the critical factors that affect the nature of competition in an industry. Secondly managers consider how current (and potential) competitors invest in their strategy. Finally, a value curve is drawn up which paints a picture of how your company invests in factors of competition now and in the future.

    So to draw your own value curve you should brainstorm the factors of competition and list them along the horizontal axis. Then mark along the vertical axis the extent to which the business invests in each factor of competition. Then map your own business and the business of your close competitors. Once strategy is crafted, you need to consider the three complementary qualities which characterise an effective strategy according to Chan Kim and Mauborgne – focus, divergence and a compelling tag line.

    The authors cite Southwest Airlines as an example of good practices. Here we are going to apply the strategic canvas and the complementary qualities to Ryanair – the Irish low-cost airline which is one of the largest in Europe. Ryanair has a large number of competitive factors (see Ryanair Marketing Mix) – although the most salient factors are as follows:

    1. Ancillary services e.g. car hire, hotels, phone cards, coach tickets etc.
    2. Low fares
    3. Online booking
    4. Secondary airports
    5. Low cost advertising

    References

    Chan Kim, W. and Mauborgne, R. (2005), Blue Ocean Strategy, Harvard Business School Press.

    Chan Kim, W. and Mauborgne, R. (2002), Charting Your Company’s Future, Harvard Business Review, June 2002.

    Chan Kim, W. and Mauborgne, R. (1999), Creating New Market Space, Harvard Business Review, January – February 1999.

    Chan Kim, W. and Mauborgne, R. (1997), Value Innovation: The Strategic Logic of High Growth, Harvard Business Review, January – February 1997.

    Value Chain Analysis

    Value Chain Analysis

    The value chain is a systematic approach to examining the development of competitive advantage. It was created by M. E. Porter in his book, Competitive Advantage (1980). The chain consists of a series of activities that create and build value. They culminate in the total value delivered by an organisation.

    Support Activities.

    Procurement.

    This function is responsible for all purchasing of goods, services and materials. The aim is to secure the lowest possible price for purchases of the highest possible quality. They will be responsible for outsourcing (components or operations that would normally be done in-house are done by other organisations), and ePurchasing (using IT and web-based technologies to achieve procurement aims).

    Technology Development.

    Technology is an important source of competitive advantage. Companies need to innovate to reduce costs and to protect and sustain competitive advantage. This could include production technology, Internet marketing activities, lean manufacturing, Customer Relationship Management (CRM), and many other technological developments.

    Human Resource Management (HRM).

    Employees are an expensive and vital resource. An organisation would manage recruitment and s election, training and development, and rewards and remuneration. The mission and objectives of the organisation would be driving force behind the HRM strategy.

    Firm Infrastructure.

    This activity includes and is driven by corporate or strategic planning. It includes the Management Information System (MIS), and other mechanisms for planning and control such as the accounting department.

    The ‘margin’ depicted in the diagram is the same as added value. The organisation is split into ‘primary activities’ and ‘support activities.’ Also see value curve.

    Primary Activities.

    Inbound Logistics.

    Here goods are received from a company’s suppliers. They are stored until they are needed on the production/assembly line. Goods are moved around the organisation.

    Operations.

    This is where goods are manufactured or assembled. Individual operations could include room service in an hotel, packing of books/videos/games by an online retailer, or the final tune for a new car’s engine.

    Value Chain

    Outbound Logistics.

    The goods are now finished, and they need to be sent along the supply chain to wholesalers, retailers or the final consumer.

    Marketing and Sales.

    In true customer orientated fashion, at this stage the organisation prepares the offering to meet the needs of targeted customers. This area focuses strongly upon marketing communications and the promotions mix.

    Service.

    This includes all areas of service such as installation, after-sales service, complaints handling, training and so on.

    Traffic Lights

    Traffic Lights

    Traffic Lights Exercise.

    A tool for creative marketing

    As with many of the tools and techniques considered on Marketing Teacher, traffic lights is a simple and effective approach. It’s just like the traffic lights exercise that are seen in millions of streets throughout the world, and is a basic metaphor for red, amber and green. Red means ‘let’s STOP it,’ Amber means ‘PROCEED WITH CAUTION, but make some improvements,’ and Green means ‘Go’ or ‘Let’s carry on with this activity.’

     

    Traffic lights is a creative marketing tool that can be used in a number of ways.
    trafficlight

     

    • You could conduct a personal traffic lights exercise based upon your own personal or professional development.
    • The exercise can be run at any stage of the marketing planning or creative process. So you could run it as you begin marketing, during a marketing campaign, and at the end of a marketing programme as you review or control your marketing activities.

    Traffic lights has a number of benefits to marketing managers:

    • It encourages a creative approach to marketing
    • Traffic lights is simple to use
    • Traffic lights is quick to learn
    • Traffic lights cross cultures, since most countries use this common approach to traffic control.
    • Traffic lights transcend interdepartmental and disciplinary differences so that it is a common platform for decision-making.

    The starting point is to decide upon an activity on which to base your traffic lights exercise. Some examples include:

    • How do we improve our marketing planning?
    • How do we make our marketing communications activities more effective?
    • In what ways could eMarketing be made more efficient?
    • How could I become a better marketing manager?
    • How could I improve my grades?

    Okay, now you’ve read the lesson, have a go at the exercise (with answer).

    Traffic Lights, Example – Serendipity

    So let’s consider a company called Serendipity that markets Ski Wear. Serendipity conducted a traffic lights exercise upon its core marketing activities. Marketing managers and interested individuals from purchasing, sales management, finance and R&D met in a training room, and recorded their views under the headings red-amber-green. The results are as follows:

    Red – STOP

    • Get rid of any distributors that favour competitor brands over our own.
    • Withdraw product lines that make a loss.
    • Remove our branding from any none-ski wear clothing.
    • Stop sponsoring amateur or low ranking skiers, and enhance the exclusivity of our brand.

    Amber – PROCEED WITH CAUTION, and make some improvements.

    • Reduce the number of distributors that have Serendipity agency agreements. Start backing our proactive winners that really wish to endorse our brand and make it central to their business.
    • Promote or reposition products that are mature.

    Green – Go or Let’s carry on with this activity.

    • Reward our best distributors, and develop as the bases for long-terms relationships.
    • Develop and enhance products that are highly profitable.
    • Let’s continue to sponsor top skiers that enhance our brand values.

    Three Levels of a Product


    Three Levels of a Product.

    Consumers often think that a product is simply the physical item that he or she buys. In order to actively explore the nature of a product further, let’s consider it as three different products – the CORE product, the ACTUAL product, and finally the AUGMENTED product. This concept is known as the Three Levels of a Product.

    Three Levels of a Product
    Three Levels of a Product

    The CORE product is NOT the tangible physical product. You can’t touch it. That’s because the core product is the BENEFIT of the product that makes it valuable to you. So with the car example, the benefit is convenience i.e. the ease at which you can go where you like, when you want to. Another core benefit is speed since you can travel around relatively quickly.

    The ACTUAL product is the tangible, physical product. You can get some use out of it. Again with the car, it is the vehicle that you test drive, buy and then collect. You can touch it. The actual product is what the average person would think of under the generic banner of product.

    The AUGMENTED product is the non-physical part of the product. It usually consists of lots of added value, for which you may or may not pay a premium. So when you buy a car, part of the augmented product would be the warranty, the customer service support offered by the car’s manufacturer and any after-sales service. The augmented product is an important way to tailor the core or actual product to the needs of an individual customer. The features of augmented products can be converted in to benefits for individuals.

    Features and benefits of products

    Features and benefits of a product are also relevant to the three levels of the product. Products tend to have a whole series of features but only a small number of benefits to the actual consumer.

    Let’s look at this another way, if you buy a Nintendo console it has many features; for example you can play games alone or you can play against another opponent or two or three opponents. You can also have access to the Internet. Avatars are adaptable so you can create yourself and your friends. These are all examples of features to the consumer. However a consumer may buy it because he or she wants to stay fit and will use software and peripherals to become healthier. Becoming healthier is the benefit to the consumer.

    The consistent marketer will aim to discover the consumer’s preference for benefits and will match individual features to the preference. That is why professional salespeople for example, often ask many questions whereas a novice salesperson will just tell you the features of the product.

    New Product Development (NPD)

    New Product Development (NPD) will take in to account the consumer’s preference for benefits over features by considering research into their needs. NPD aims to satisfy and anticipate needs. NPD delivers products which offer benefits at the core, actual and augmented levels.

    NPD might offer a replacement product for a current line, it could add products to the current line, it could discover new product lines and sometimes it delivers very innovative products which the world might not have seen before.

    New products are launched for all sorts of reasons. As we know from our previous lesson on the business environment, legislation i.e. changes in the law can mean that companies have to design and develop new products. An example of this was when we moved from videotape recorders to digital and DVD recorders. So products need to be modified for changing target markets.

    Sometimes the company will need to increase the volume that a production plant delivers, since maybe it is not running at full capacity. An example of this would be a food manufacturer of tinned soup that has a factory which can operate 24/7, designing different derivatives of the soup in order to lower the unit cost of production. So product lines are extended, in this case the reason being is to ease operational efficiency.

    Intense competitive rivalry in the market will also lead to the need for NPD. Just think about your smart phone and how quickly such products go through their product life cycles, throughout your customer life-cycle.

    Change in any element of the marketing mix would influence NPD, for example there is a movement to shop online and some products need to be distributed via online retailers, and the product is adapted to make it compact and simple to deliver. NPD can be driven by many influences from changing consumer tastes to the need to adapt products and services for local or international market.

    Another marketing tool for evaluating PRODUCT is the Product Life Cycle (PLC). Also see the Customer Life Cycle (CLC).

    Value and Relationship Quality

    Consumer Behavior

    Value and Relationship Quality

    Consumers choose goods and services based on the assumption that they will be rewarded with value and satisfaction. Consumption is the process by which goods and services are used and assigned a level of value by the consumer.

    That level could be positive, if the customer was satisfied, or it could be negative if they did not find any value in their purchase. Marketers have to provide the right combination of quality, price and customer service in order to give customers positive value and satisfaction. That will in turn create happy, loyal customers. The formula looks like this:

    Quality + Price + Customer Service = Value and Satisfaction

    If a product/service is provided that has low quality, and a high price, that does not create a happy, satisfied customer. At the same time, having a great product at the best possible price means nothing if the customer is treated badly, or not provided with the opportunity to return unwanted items.

    Value Relationship Quality

    So what is meant by ‘Quality?’

    Quality is a product or service’s ability to meet the customers’ need or want. Quality is difficult to define, and varies with each consumer, however we can take a look at some of the components of quality for products and services:

    Products

    • Performance-The product does what it is supposed to do.
    • Features-The product includes all the specifications that it says it has or that are required, this includes safety measures.
    • Reliability-The product performs consistently.
    • Durability-When the product is being used it has to last under the conditions of normal use.
    • Serviceability-The product is easy to maintain or repair either by the consumer or by providing a warranty which says the company will provide repairs.
    • Aesthetics-This is important to consumers, products have to look good, and this contributes to a brand equity and identity.
    • Perception-Even if the product has good quality, if the customer does not think so, then it won’t sell. The customer has to have positive feelings about the product, the company, the brand name and the employees.

    Services

    • Responsiveness-Services are performed in a prompt manner.
    • Reliability-The service is performed right, the first time, and all subsequent times.
    • Assurance-Knowledgeable and friendly employees are essential as customers will equate employees behavior with the entire company. If a customer has a bad experience with an employee, they will be less likely to purchase from the entire company’s offerings. Customers expect technical competence and professionalism from salespeople.
    • Empathy-Providing individualized attention to customers will make them feel special and keep them coming back.
    • Tangibles-Some services provide physical evidence that they occurred, for example a restaurant cooks (service) and provides the food (product).

     

    Target

    Targeting

    Part of STP – Segment-Target-Postion

    Targeting is the second stage of the SEGMENT “Target” POSITION (STP) process. After the market has been separated into its segments, the marketer will select a segment or series of segments and ‘target’ it/them. Resources and effort will be targeted at the segment.

    Targeting

    The first is the single segment with a single product. In other word, the marketer targets a single product offering at a single segment in a market with many segments. For example, British Airway’s Concorde is a high value product aimed specifically at business people and tourists willing to pay more for speed.

    Targeting

    Secondly the marketer could ignore the differences in the segments, and choose to aim a single product at all segments i.e. the whole market. This is typical in ‘mass marketing’ or where differentiation is less important than cost. An example of this is the approach taken by budget airlines such as Go/

    Targeting

    Finally there is a multi-segment approach. Here a marketer will target a variety of different segments with a series of differentiated products. This is typical in the motor industry. Here there are a variety of products such as diesel, four-wheel-drive, sports saloons, and so on.

    Now have a look at the final stage, positioning.

    Meta / Alvo

    Meta / Alvo

    Meta é o segundo estágio do processo do SEGUIMENTOMETAPOSIÇÃO (STP). Depois que o mercado é separado entre seus seguimentos, o comerciante selecionará um seguimento ou uma série de seguimentos e decidir qual será sua(s) metas.

    Image

    Primeiramente, um único seguimento com um único produto. Em outras palavras, o comerciante tem como meta um único produto oferecido a um único seguimento em um mercado com muitos seguimentos. Por exemplo: British Airway´s Concorde (Linhas aéreas Britânicas) é um produto de alto valor desenvolvido para pessoas de negócios e turistas que pagarão mais pela velocidade do voo.

    Image

    Aqui o comerciante poderá ignorar as diferenças nos segmentos, e escolher apontar um único produto em todos os seguimentos, isto é o: mercado inteiro. Isto é típico em ‘marketing em massa’ ou onde a diferenciação é menos importante do que o custo. Um exemplo disso é a abordagem tomada por linhas aéreas como a Go.

    Image

    Finalmente há uma abordagem de multi-seguimentos. Aqui um comerciante terá como meta uma variedade de diferentes seguimentos com uma série de produtos diferenciados. Isto é típico na indústria automobilística. Aqui há uma variedade de produtos tais como o diesel, carros com tração nas quatro rodas (4WD), sport saloons, e assim por diante.

    Agora dê uma olhana no estágio final, posicionamento.

    Standard Costing

    Standard Costing

    Perhaps no accounting principle utilizes performance management concepts better than standard costing. One of the elements of cost accounting, standard costing is of particular benefit to those companies engaged in manufacturing.

    Each type of standard has its strengths and weaknesses, but regular monitoring and making revisions based upon current conditions incorporates performance management concepts and would seem to present the best chance for success

    A firm wishing to utilize finances efficiently monitors the following costs:

    • Direct Material Costs
    • Direct Labor Costs
    • Manufacturing Overhead

    The process of standard costing is achieved, in part, i.e., identifying a standard cost for each. A typical company may employ a committee to develop a standard costing plan.
    Such a committee often involves key personnel such as a Cost Accountant, Production Manager, Personnel Manager and Purchase Manager.

    This group clarifies and classifying its costs in more detail, grouping them by some categories such as the examples below:

    • Functionality (production, Selling, Distribution, etc.)
    • Fixed Costs
    • Variable Costs
    • Direct Costs
    • Indirect Costs

    Assuming a company establishes realistic standard costs, it may then monitor performance with an eye on increasing efficeintcy and minimizing waste.

    To judge the company on its performance over time, the standard costing team will determine which type of standard to employ. Depending on its goals and industry environment, a company may choose one of the following types of standards:

    Maximum Level Standards – presumes that maximum ideal environmental conditions and company conditions are most favorable.

    Current Level Standards – developed from recent company conditions and industry environment. Current standards are usually adjusted annually.

    Basic Level Standards – provides levels and baselines designed for long term use, perhaps based on average levels over a 10 year period. Basic standards don’t adjust for current conditions, and does not serve monitoring purposes as well.

    Six Thinking Hats

    Six Thinking Hats

    Edward De Bono. Six Thinking Hats (1985)

    In our thinking, we often try to do too much at the same time. We look at the facts of the matter. We try to build a logical argument. We may try to come up with some new ideas. We may even get emotional. Marketing managers tend to be multitasking and often have many projects on the go at the same time. Marketers have deadlines to meet. Marketing is creative, and the Six Thinking Hats helps us to provide marketing solutions to marketing problems.

    The six thinking hats can be used occasionally as a means of switching thinking or systematically where a sequence of hats is established in advance to enable the thinker(s) to go through each stage of thinking.

    The six thinking hats is a method for doing one sort of thinking at a time. Instead of trying to do everything at once, we wear only one hat at a time. It’s a metaphor. There are six colored hats and each color represents a type of thinking.

    Six Thinking Hats

    Green Hat.

    The green hat is for creative thinking. Creative thinking may mean new ideas, alternatives, new solutions or inventions. It could also mean making something happen. The main uses of green hat are:

    1. To explore the situation in terms of ideas, concepts, suggestions and possibilities.

    2. To put forward proposals or suggestions of any sort, e.g. suggestions for action, possible decisions, etc.

    3. To consider further options or alternatives. The green hat seeks to broaden the range of options before pursuing any one of them in detail. Yellow and black hat thinking are used to assess alternatives.

    4. To come up with some new ideas. Lateral thinking techniques can be used deliberately in order to generate some new ideas.

    5. To put forward some deliberate provocations. A provocation is not meant to be a usable idea. It is a way of releasing the mind from its usual track.

    Blue Hat.

    The blue hat gives an overview of our thinking. It covers the following points:

    1. Where are we now in our thinking?

    2. What should we do next in our thinking?

    3. To establish an agenda or sequence for our thinking.

    4. To summarize what has been achieved so far in the thinking.

    White Hat.

    The white hat means neutral information. White hat thinking focuses on the available information. There are three key questions:

    1. What information do we have?

    2. What information is missing?

    3. How do we get the information we need?

    Red Hat.

    The red hat is for emotions, feelings, hunches and intuition. Unlike white hat the red hat is not interested in facts, but only in people’s feelings. The purpose of the red hat is to allow us to put forward our feelings so they can take part in the thinking. The red hat provides a clear label for those feelings. Intuition is often based upon experience about a matter, but we cannot exactly explain why we have such an intuition. The red hat allows the thinker to put forward a hunch or intuition without any need to support or justify it.

    Black Hat.

    The black hat is generally the most used of all the hats. It is the one that prevents us from making mistakes and doing silly things. The black hat is concerned with the truth, reality and critical thinking. The key questions are:

    1. Is it true?

    2. Does it fit?

    3. Will it work?

    4. What are the dangers and the problems?

    Yellow Hat.

    In general the yellow hat is optimistic and looking forward to the future. It can however be used to review the past but from the perspective of what we can learn from past experiences i.e. being positive and looking on the bright side. The key questions are:

    1. What are the benefits?

    2. Why should it work?

    The Six Living Generations In America

    Dr. Jill Novak, University of Phoenix, Texas A&M University.

    In America, there are six living generations, which are six fairly distinct groups of people. As a generalization each generation has different likes, dislikes, and attributes. They have had collective experiences as they aged and therefore have similar ideals. A person’s birth date may not always be indicative of their generational characteristics, but as a common group they have similarities.

    The six living generations

    GI Generation

    GI Generation.

    • Born 1901-1926.
    • Children of the WWI generation & fighters in WWII & young in the Great Depression…all leading to strong models of teamwork to overcome and progress.
    • Their Depression was The Great One; their war was The Big One; their prosperity was the legendary Happy Days.
    • They saved the world and then built a nation.
    • They are the assertive and energetic do’ers.
    • Excellent team players.
    • Community-minded.
    • Strongly interested in personal morality and near-absolute standards of right and wrong.
    • Strong sense of personal civic duty, which means they vote.
    • Marriage is for life, divorce and having children out of wedlock were not accepted.
    • Strong loyalty to jobs, groups, schools, etc.
    • There was no “retirement” you worked until your died or couldn’t work anymore.
    • The labor-union-spawning generation.
    • “Use it up, fix it up, make it do, or do without.”
    • Avoid debt…save and buy with cash.
    • Age of radio and air flight; they were the generation that remembers life without airplanes, radio, and TV.
    • Most of them grew up without modern conveniences like refrigerators, electricity and air conditioning.
    • Sometimes called The Greatest Generation.

    Mature / Silents

    Mature/Silents.

    • Born 1927- 1945.
    • Went through their formative years during an era of suffocating conformity, but also during the postwar happiness: Peace! Jobs! Suburbs! Television! Rock ‘n Roll! Cars! Playboy Magazine!
    • Korean and Vietnam War generation.
    • The First Hopeful Drumbeats of Civil Rights!
    • Pre-feminism women; women stayed home generally to raise children, if they worked it was only certain jobs like teacher, nurse or secretary.
    • Men pledged loyalty to the corporation, once you got a job, you generally kept it for life.
    • The richest, most free-spending retirees in history.
    • Marriage is for life, divorce and having children out of wedlock were not accepted.
    • In grade school, the gravest teacher complaints were about passing notes and chewing gum in class.
    • They are avid readers, especially newspapers.
    • “Retirement” means to sit in a rocking chair and live your final days in peace.
    • The Big-Band/Swing music generation.
    • Strong sense of trans-generational common values and near-absolute truths.
    • Disciplined, self-sacrificing, & cautious.

    Baby Boomer

    Baby Boomers

    Baby boomers are the demographic of people who were born just after the Second World War; this would give the baby boomer generation an approximate date of between 1946 and 1964 .  World war two ended in a 1945, and as a rule of thumb baby boomers are the children who are born as the war ended, as families settled down again. More >>

    • Born between 1946 and 1964. Two sub-sets:
    • 1. the save-the-world revolutionaries of the ’60s and ’70s;
    • and 2. the party-hardy career climbers (Yuppies) of the ’70s/’80s.
    • The “me” generation.
    • “Rock and roll” music generation.
    • Ushered in the free love and societal “non-violent” protests which triggered violence.
    • Self righteous & self-centered.
    • Buy it now and use credit.
    • Too busy for much neighborly involvement yet strong desires to reset or change the common values for the good of all.
    • Even though their mothers were generally housewives, responsible for all child rearing, women of this generation began working outside the home in record numbers, thereby changing the entire nation as this was the first generation to have their own children raised in a two-income household where mom was not omnipresent.
    • The first TV generation.
    • The first divorce generation, where divorce was beginning to be accepted as a tolerable reality.
    • Began accepting homosexuals.
    • Optimistic, driven, team-oriented.
    • Envision technology and innovation as requiring a learning process.
    • Tend to be more positive about authority, hierarchal structure and tradition.
    • One of the largest generations in history with 77 million people.
    • Their aging will change America almost incomprehensibly; they are the first generation to use the word “retirement” to mean being able to enjoy life after the children have left home. Instead of sitting in a rocking chair, they go skydiving, exercise and take up hobbies, which increases their longevity.
    • The American Youth Culture that began with them is now ending with them and their activism is beginning to re-emerge.

    Generation X

    Generation X.

    • Born between 1965 and 1980*
    • The “latch-key kids” grew up street-smart but isolated, often with divorced or career-driven parents. Latch-Key came from the house key kids wore around their neck, because they would go home from school to an empty house.
    • Entrepreneurial.
    • Very individualistic.
    • Government and big business mean little to them.
    • Want to save the neighborhood, not the world
    • Feel misunderstood by other generations
    • Cynical of many major institutions, which failed their parents, or them, during their formative years and are therefore eager to make marriage work and “be there” for their children
    • Don’t “feel” like a generation, but they are
    • Raised in the transition phase of written based knowledge to digital knowledge archives; most remember being in school without computers and then after the introduction of computers in middle school or high school
    • Desire a chance to learn, explore and make a contribution
    • Tend to commit to self rather than an organization or specific career. This generation averages 7 career changes in their lifetime, it was not normal to work for a company for life, unlike previous generations.
    • Society and thus individuals are envisioned as disposable.
    • AIDS begins to spread and is first lethal infectious disease in the history of any culture on earth which was not subjected to any quarantine.
    • Beginning obsession of individual rights prevailing over the common good, especially if it is applicable to any type of minority group.
    • Raised by the career and money conscious Boomers amidst the societal disappointment over governmental authority and the Vietnam war.
    • School problems were about drugs.
    • Late to marry (after cohabitation) and quick to divorce…many single parents.
    • Into labels and brand names.
    • Want what they want and want it now but struggling to buy, and most are deeply in credit card debt.
    • It is has been researched that they may be conversationally shallow because relating consists of shared time watching video movies, instead of previous generations.
    • Short on loyalty & wary of commitment; all values are relative…must tolerate all peoples.
    • Self-absorbed and suspicious of all organization.
    • Survivors as individuals.
    • Cautious, skeptical, unimpressed with authority, self-reliant.

    Generation Y

    Generation Y/Millennium.

    • Born between 1981* and 2000*.
    • Aka “The 9/11 Generation” “Echo Boomers” America’s next great generation brings a sharp departure from Generation X.
    • They are nurtured by omnipresent parents, optimistic, and focused.
    • Respect authority.
    • Falling crime rates. Falling teen pregnancy rates. But with school safety problems; they have to live with the thought that they could be shot at school, they learned early that the world is not a safe place.
    • They schedule everything.
    • They feel enormous academic pressure.
    • They feel like a generation and have great expectations for themselves.
    • Prefer digital literacy as they grew up in a digital environment. Have never known a world without computers! They get all their information and most of their socialization from the Internet.
    • Prefer to work in teams.
    • With unlimited access to information tend to be assertive with strong views.
    • Envision the world as a 24/7 place; want fast and immediate processing.
    • They have been told over and over again that they are special, and they expect the world to treat them that way.
    • They do not live to work, they prefer a more relaxed work environment with a lot of hand holding and accolades.

    Generation Z

    Generation Z/Boomlets.

    • Born after 2001*
    • In 2006 there were a record number of births in the US and 49% of those born were Hispanic, this will change the American melting pot in terms of behavior and culture. The number of births in 2006 far outnumbered the start of the baby boom generation, and they will easily be a larger generation.
    • Since the early 1700’s the most common last name in the US was ‘Smith’ but not anymore, now it is Rodriguez.
    • There are two age groups right now:
    • (a) Tweens.
    • (a1) Age 8-12 years old.
    • (a2) There will be an estimated 29 million tweens by 2009.
    • (a3) $51 billion is spent by tweens every year with an additional $170 billion spent by their parents and family members directly for them.
    • (b)Toddler/Elementary school age.
    • 61 percent of children 8-17 have televisions in their rooms.
    • 35 percent have video games.
    • 14 percent have a DVD player.
    • 4 million will have their own cell phones. They have never known a world without computers and cell phones.
    • Have Eco-fatigue: they are actually tired of hearing about the environment and the many ways we have to save it.
    • With the advent of computers and web based learning, children leave behind toys at younger and younger age. It’s called KGOY-kids growing older younger, and many companies have suffered because of it, most recognizable is Mattel, the maker of Barbie dolls. In the 1990’s the average age of a child in their target market was 10 years old, and in 2000 it dropped to 3 years old. As children reach the age of four and five, old enough to play on the computer, they become less interested in toys and begin to desire electronics such as cell phones and video games.
    • They are Savvy consumers and they know what they want and how to get it and they are over saturated with brands.

    References.

    deMesa, A. (2008). Marketing and tweens. Retrieved on February 21, 2008.

    Elegant, S. (5 November 2007). China’s me generation. Time Magazine.

    Generational Generalities. (2005). America’s generations. Retrieved November 6, 2007.

    Generational Imperative. (2006). Meet Americas 5 living generations. Retrieved on November 6, 2007.

    Marketing Vox. (2008). Generation Z. Retrieved on February 14, 2008.

    Parents. (December 2007). Check out this news. Parents Magazine, p.166.

    This is only a guideline, remember that everyone is different and not everyone fits into this analysis, but for the most part you can generalize their behavior. As a marketer, it is important to know how to effectively communicate and market to these diverse generations. In understanding consumer behavior, you can create the right promotion, tailoring it specifically for each group’s needs and therefore effectively sell products and services.

    The dates for GI, Mature, and Baby Boomer and the beginning of Gen X are set and do not change, the dates for the end of Gen X, Gen Y and Gen Z fluctuate depending on what source you are using.

    Similar topics include:

    Internal Influences – Personality

    Internal Influences – Motivation

    Internal Influences – Memory

    Internal Influences – Lifestyle and Attitude

    Internal Influences – Learning

    Internal Influences – Emotion and Perception

    Shell Directional Policy Matrix

    Shell Directional Policy Matrix

    A Nine Celled directional Policy Matrix

    The Shell Directional Policy Matrix is another refinement upon the Boston Matrix. Along the horizontal axis are prospects for sector profitability, and along the vertical axis is a company’s competitive capability. As with the GE Business Screen the location of a Strategic Business Unit (SBU) in any cell of the matrix implies different strategic decisions.

    • Double or quit – gamble on potential major SBU’s for the future.
    • Growth – grow the market by focusing just enough resources here.
    • Custodial – just like a cash cow, milk it and do not commit any more resources.
    • Cash Generator – Even more like a cash cow, milk here for expansion elsewhere.
    • Phased withdrawal – move cash to SBU’s with greater potential.
    • Divest – liquidate or move these assets on a fast as you can.

    However decisions often span options and in practice the zones are an irregular shape and do not tend to be accommodated by box shapes. Instead they blend into each other.

    Shell Directional Policy Matrix

    Each of the zones is described as follows:

    • Leader – major resources are focused upon the SBU.
    • Try harder – could be vulnerable over a longer period of time, but fine for now.

    Seven Cs

    The Seven Cs

    7 Cs Website design elements that drive customer traffic

    Dr. Jill Novak, University of Phoenix, Texas A&M University

    There are seven design elements – 7Cs – that should be considered when creating a website intended for commerce and sales. Customers shop online for several reasons; the most important are the convenience, cost, large selection and the allure of control over their purchases. Customers can easily shop around from anywhere they have an Internet connection; this gives companies an even greater imperative to create a website that will drive traffic to their website, appeal to their target markets, and create a lasting experience that will create return customers.

    5. Create an explanation of your website that will include all of the design elements that drive customer experience. (you do not have to create an actual website)

    6. Get out some paper and draw a map of what your destination site will look like and what amenities you will be including. What are some of the activities your visitors can partake in and how do these relate to your eco-mission?

    • Context : A website’s layout and overall visual design needs to be uncluttered, easy to read and navigate, the color scheme needs to be appropriate for the marketing design. Having some white space will also aid in the overall design and readability.
    • Commerce : If the website is intended for commercial transactions, then it has to be safe and the fact that is has been made safe must be communicated to the customer, most websites use a "lock" symbol in the corner to indicate that it has been encrypted.
    • Connection : Any links that lead the customer away from the website.
    • Communication : How the company talks to its customers ; this can be done through signing up for special offers, email newsletters, contests, surveys, live chat with company representatives, and company contact information.
    • Content : The text, graphics, sound, music, and/or videos that are presented.
    • Community : The website may allow interaction between customers through message boards and live chat.
    • Customization : Companies can allow customers to personalize aspects of the website or it may tailor itself to different users, for example having different colors and graphics for people who speak different languages.

    Activity–Ecotourism and Attracting A Customer Base.

    "[Ecotourism]…is environmentally responsible travel and visitation to relatively undisturbed natural areas, in order to enjoy and appreciate nature (and any accompanying cultural features – both past and present) that promotes conservation, has low negative visitor impact, and provides for beneficially active socio-economic involvement of local populations."

    Activity.

    Design your own Ecotourist Resort

    1. Choose a destination. Where will your resort will be located? Why this place? How will your resort make as limited an impact as possible on the site? How will energy be provided for the site? What are some conservation measures your site will use?

    2. Choose an animal you want to highlight at your destination. Perform research about your chosen animal, including their habitat, physical characteristics, and causes of death, as well as efforts to protect them.

    3. Decide who is your target market (or markets), be as specific as possible!

    4. How will the local community benefit from your resort?

    Introduction to Services Marketing

    Services Marketing

    What is services marketing?

    A service is the action of doing something for someone or something. It is largely intangible (i.e. not material). You cannot touch it. You cannot see it. You cannot taste it. You cannot hear it. You cannot feel it. So a service context creates its own series of challenges for the marketing manager since he or she must communicate the benefits of a service by drawing parallels with imagery and ideas that are more tangible.

    Search quality is the perception in the mind of the consumer of the quality of the product prior to purchase through making a series of searches. So this is simple in relation to a tangible product because you might look at size or colour for example. Therefore search quality relates more to products
    and services.

    Experience quality is easier to assess. In terms of service you need to taste the food or experience the service level. Therefore your experiences allow you to evaluate the level and nature of the service. You remember a great vacation because of the food or service, but by the same token you remember an awful vacation because of the hopeless food or poor service.

    Credence quality is based upon the credibility of the service that you undertake. This is down to the reputation of a dentist or of a decorator. Credence is used where you have little knowledge of the topic and where you rely upon the professionalism of the expert.

    Perishable

    Perishable – in that once it has occurred it cannot be repeated in exactly the same way. For example, once a 100 meters Olympic final has been run, there will not be another for 4 more years, and even then it will be staged in a different place with many different finalists. You cannot put service in the warehouse, or store in your inventory. An interesting argument about perishability goes like this, once a flight has taken off you cannot sell that seat again, hence the airline makes no profit on that seat. Therefore the airline has no choice but to price at peak when it sells a seat at busy times in order to make a profit. That’s why restaurants offer vouchers to compensate for quieter times, and it is the same for railway tickets and matinees in Broadway during the middle of the week.

    Variable

    Variability- since the human involvement in service provision means that no two services will be completely identical, they are variable. For example, returning to the same garage time and time again for a service on your car might see different levels of customer satisfaction, or speediness of work. If you watch your favourite/favorite music group on DVD the experience will be the same every time you play it, although if you go to see them on tour when they are live no two performances will be identical for a whole variety of reasons. Even with the greatly standardized McDonalds experience, there are slight changes in service, often through no fault of the business itself. Sometimes Saturday lunchtime will be extremely busy, on other days you may have to wait to go via the drive through. So services tend to vary from one user experience to another.

    Homogeneous

    Homogeneity is where services are largely the same (the opposite of variability above). We considered McDonald’s above which is a largely homogeneous service, so now let’s look at KFC and Pizza Hut. Both of these businesses provide a homogeneous service experience whether you are in New York, or Alaska, or even Adelaide. Consumers expect the same level of service and would not anticipate any huge deviation in their experience. Outside of the main brands you might expect a less homogeneous experience. If you visit your doctor he or she might give one interpretation, whereas another doctor might offer a different view. Your regular hairdresser will deliver a style whereas a hairdresser in the next town could potentially style your hair differently. Therefore standardization is largely embodied by the large global brands which produce services.

    Right of ownership is not taken to the service, since you merely experience it. For example, an engineer may service your air-conditioning, but you do not own the service, the engineer or his equipment. You cannot sell it on once it has been consumed, and do not take ownership of it.

    Western economies have seen deterioration in their traditional manufacturing industries, and a growth in their service economies. Therefore the marketing mix has seen extended and adapted to create the services marketing mix, also known as the 7P’s or the extended marketing mix – physical evidence, process and people.

    A product is tangible (i.e. material) since you can touch it or own it. A service tends to be an experience that is consumed at the point where it is purchased and cannot be owned since it quickly perishes. A person could go to a café one day and enjoy excellent service, and then return the next day and have a poor experience. Marketers talk about the nature of a service as being inseparable, intangible, perishable, homogenous and variable.

    Inseparable

    Inseparable – from the point where it is consumed, and from the provider of the service. For example, you cannot take a live theatre performance home to consume it (a DVD of the same performance would be a product, not a service). The consumer is actually involved in the production process that they are buying at the same time as it is being produced, for example an eye test or a makeover. One benefit would be that if you are unhappy with you makeover you can tell the beautician and that instant feedback means that the service quality is improved. You can’t do that with a product. Another attribute is that services have to be close to the person consuming them i.e. goods can be made in a central factory location which has the benefits of mass production. This localization means that consumption is inseparable from production.

    Intangible

    Intangible – cannot have a real, physical presence as does a product. For example, motor insurance may have a certificate, but the financial service itself cannot be touched i.e. it is intangible. This makes it tricky to evaluate the quality of service prior to consuming it since there are fewer attributes of quality in comparison to a product. One way is to consider quality in terms of search, experience and credence.

    Services Marketing Mix

    Services Marketing Mix

    As we discussed in the lesson on services, there are a series of fundamental characteristics such as intangibility, inseparability, heterogeneity and perishability which are unique to a service. The traditional marketing mix which includes product, place, price and promotion could be stretched to compensate for these factors. However the services marketing mix is an adaptation of the traditional 4Ps to address these characteristics and it sees the addition of another 3Ps which are physical evidence, process and people. We will also consider how the traditional mix alters for a service with sections below on pricing for services, product for services, place for services, and promotion for services.



    Of course the marketing mix for services still needs to address the remaining 4Ps of pricing, product, place and promotion. Let’s consider some examples of these four elements from the perspective of a service.

    Pricing for services

    Pricing needs to take into account two factors in relation to services. The first issue is what is the unit which we are pricing? Do we sell a hotel room based on its area or upon how long you use it for? Would you cost dental surgery by the amount of time you sat in the dentist’s chair or by the actual procedure that was undertaken? Secondly if a price is based upon a bundle of sub services then how do you price it as a whole? An example of this would be an all-you-can-eat menu priced at a single point e.g. €20, or would you charge for each item on the menu individually and add-on a service charge?

    Product for services

    In this instance our product and service are pretty much the same. However as we have discussed our service is intangible etc. One-way dealing with this is to consider that: service = product + process. So we need to focus upon the process. For example when you arrive at a hotel people process you to ensure that you are registered and your baggage is taken to a room. This is an example of people processing. Another type of processing is possession processing, and an example would be where you take your dog to be groomed, or you organise a service for your car i.e. your possessions are processed. Both of these are examples of product in relation to service.

    Place for services

    Where you consume the service is a central part of the services marketing mix. With the place element the marketer considers convenience, location, footfall, number of outlets, and timing. Consider an event which takes place over a weekend. If you have a food trailer which sells organic salads to the public you need to make sure that you are actually booked at the event, that people will walk past your trailer and be able to stop and queue, and that you are able to sell to the people when they want to eat. Simply scale this up for businesses like Pizza Express.

    Promotion for services

    Obviously services are more difficult to assess in terms of attributes in comparison to tangible products. The marketer needs to be more innovative and clear when it comes to the benefits to the target market of his or her service. The marketer can try a number of techniques which include:

    • Emphasising any tangible cues e.g. telecommunications companies will use symbols such as Mercury to emphasise speed. Burger King will use boxes and packaging which emphasise its marketing communications.
    • Exploiting celebrity to provide information about the service. There are many examples of well-known public faces telling us on TV how they purchase life assurance or organise their final will.
    • Branding is everything to service. Starbucks does sells coffee and cake but much of its offering is its service. Starbucks’ logo, its location, the ambience of their stores and the whole service experience is all part of the brand Starbucks. There are many other examples of this including KFC and McDonalds. Can you think of any more?

    Physical Evidence

    (Physical evidence is) . . . The environment in which the service is delivered, and where the firm and customer interact, and any tangible components that facilitate performance or communication of the service.

    Zeithaml et al (2008)

    Physical Evidence is the material part of a service. Strictly speaking there are no physical attributes to a service, so a consumer tends to rely on material cues. There are many examples of physical evidence, including some of the following buildings, equipment, signs and logos, annual accounts and business reports, brochures, your website, and even your business cards. Physical evidence lesson >>


    Process

    (Process is) . . . The actual procedures, mechanisms, and flow of activities by which the service is delivered – this service delivery and operating systems.

    Zeithaml et al (2008).

    There are a number of perceptions of the concept of process within the business and marketing literature. Some see processes as a means to achieve an outcome, for example – to achieve a 30% market share, a company implements a marketing planning process. However in reality it is more about the customer interface between the business and consumer and how they deal with each other in a series of steps in stages, i.e. throughout the process. Process lesson >>

    People

    (People are) . . . All human actors who play a part in service delivery and thus influence the buyers’ perceptions; namely, the firm’s personnel, the customer, and other customers in the service environment.

    Zeithaml et al (2008).

    People are the most important element of any service or experience. Services tend to be produced and consumed at the same moment, and aspects of the customer experience are altered to meet the individual needs of the person consuming it. People lesson >>

    Segmenting Publics in America

    Segmenting Publics in America

    Another way of segmenting publics is to do it based on values and lifestyles. Such segmentation regularly is used by marketers to focus product and service appeals on particular socioeconomic levels. According to the VALS Lifetime Scale, segmentation separates consumers into eight distinct categories based on income and social class.

    Remember that income is not the same as wealth, income is money that is earned, wealth is accumulated assets that people already have (cars, house, art). Some people can have a high income and have no money because they spent it all, or they can have lots of wealth and no job.

    a) Actualizers
    b) Fulfilleds
    c) Believers
    d) Achievers
    e) Strivers
    f) Experiencers
    g) Makers
    h) Strugglers

    See below for more detail and examples.

    a) Actualizers are those with the most wealth and power.
    i) Successful, sophisticated, active, high self esteem, abundant resources.
    ii) Image is important not as a status symbol but as an expression of their independence and character.
    iii) Leaders in business and government.
    iv) Concerned with social issues.
    v) Have a taste for the finest things in life.
    vi) 72% married, 59% men, 95% college educated.
    vii) Income is $5 million a year and up.

    b) Fulfilleds have high resources and are principle-oriented professionals or retirees.
    i) Mature, satisfied, comfortable people.
    ii) Value order, knowledge and responsibility.
    iii) Most are well educated and in or recently retired from professional jobs.
    iv) Leisure activities center around the home and family.
    v) Conservative, practical consumers that look for functionality, value and durability in the products they buy.
    vi) Income is $2-$5 million a year.

    c) Believers are Fulfilleds without the resources.
    i) Conservative, conventional with concrete beliefs based on traditional established codes: family, church, community and the nation.
    ii) Deeply rooted moral codes.
    iii) As consumers they are predictable and conservative, favoring American products and established brands.
    iv) 70% married, 46% men, 6% college educated.
    v) Median age is 58.
    vi) Income is $500,000 to $2 million.

    Actualizers, Fulfilleds, and Believers are upper class. They are only .5% of the population in the USA but control 80% of the wealth.

    d) Achievers have high resources and are status oriented.
    i) Seek recognition and self definition through achievements at work and school.
    ii) Value predictability and stability.
    iii) Deeply committed to work and family.
    iv) Social lives are centered around family church and career.
    v) Image is important to them.
    vi) They favor established prestige products and products that demonstrate success to their peers.
    vii) 73% married, 39% men, 77% college educated.
    viii) Income around $200,000.

    e) Strivers lack the resources of Achievers but are equally status oriented.
    i) Seek approval from the world around them.
    ii) Striving to find a secure place in life.
    iii) Easily bored and impulsive.
    iv) Wish to obtain things that are out of their reach.
    v) Income around $100,000.

    Achievers and Strivers are the middle class. This group is shrinking due to high credit card debt, bad mortgages and an increasing level of unemployment in America. 90% of Americans make $100,000 or less a year in income.

    f) Experiencers have high resources, are action oriented, and are disposed toward taking risks.
    i) Young, vital, impulsive and rebellious.
    ii) Politically uncommitted and ambivalent about what they believe.
    iii) Avid consumers that spend much of their money on clothing, fast food, music and movies.
    iv) 34% married, 53% men, 41% college educated.
    v) Median age is 26.
    vi) Income is around $50,000 a year.

    g) Makers also are action oriented but have low resources.
    i) Practical with constructive skills.
    ii) Experience the world by working in it, building a house, raising children, fixing cars, canning vegetables.
    iii) Politically conservative.
    iv) Suspicious of new ideas.
    v) Respectful of government ideas and organized labor.
    vi) Unimpressed by material possessions other than those with a functional purpose.
    vii) Sometimes called the “working class.”
    viii) Income is around $30,000 a year.

    h) Strugglers have the lowest resources.
    i) Have constricted lives.
    ii) Chronically poor.
    iii) Uneducated and limited skills.
    iv) Without strong social bonds.
    v) Chief concerns are about their health and safety.
    vi) Cautious consumers.
    vii) Loyal to favorite brands.
    viii) 47% married, 37% men, 3% college educated.
    ix) Median age is 61.
    x) Median income is $9,000 a year, which is equivalent to minimum wage.

    Experiencers, Makers, and Strugglers are lower class. These three classes total around 30 million Americans. About half are married in an effort to combine resources.

    How do you appeal to each of these groups?

    Actualizers

    Appeal to their sense of independence and emphasize how it will enhance character.

    Fulfilleds

    Appeal to family issues, durability and value.

    Believers

    Appeal as an established brand, family issues.

    Achievers

    Appeal to their need to feel prestigious, image is important to them, also family and work.

    Strivers

    Appeal to the sense of attaining products they will feel important having.

    Experiencers

    Action! Appeal to a sense of youth and fun.

    Makers

    Appeal to function

    Strugglers

    Appeal to loyalty and security

     

    Segmentação

    Segmentação

    Esta é a primeira de três lições baseadas na SEGMENTAÇÃOALVO (META)POSIÇÃO. Para que um produto ou serviço chegue a pessoa ou companhia correta, o comerciante primeiramente deverá segmentar o mercado, depois, ter como alvo um segmento simples ou uma série de segmentos, e finalmente deverá posicioná-lo(s) dentro do(s) segmento(s).

    Segmentação é essencialmente a identificação de subconjuntos de compradores dentro de um mercado, o qual divide necessidades similares e que demonstra atitudes similares de compradores. O mundo é composto de bilhões de compradores com seus próprios grupos de necessidades e comportamentos. Segmentação visa combinar grupos de compradores com o mesmo grupo de necessidades e comportamentos. Tal grupo é conhecido como um ‘segmento’. Tente imaginar seu mercado como se ele fosse uma laranja, com uma série de segmentos conectados mais distintos.

    Image

    Normalmente você pode segmentar através de muitos tipos de variáveis. O diagrama acima descreve como a informação da segmentação é frequentimente representada como um diagrama ‘piechart’ – os segmentos são frequentemente nomeados e/ ou enumerados de alguma maneira. Segmentação é a forma de evaluação crítica ao invés de ser um processo ou sistema descritivo, por esse motivo não haverá nenhum mercado definido e segmentado da mesma maneira. De qualquer modo há um número de critérios que nos ajudam com a segmentação:

    • O seguimento é viável? Podemos fazer algum lucro através dele?
    • O seguimento é acessível? Qual é a facilidade para chegar no seguimento?
    • O seguimento é mensurável? Podemos obter dados realísticos para considerarmos seu potencial?

    Existem muitas maneiras em que um seguimento pode ser considerado. Por exemplo: o mercado de automóveis poderia ser seguimentado através: da idade do motorista, tamanho do motor, custo, e assim por diante. Entretanto as bases mais gerais são:

    • Através da geografia – tal como em que parte do mundo o produto foi comprado.
    • Através da psicografia – tal como estilo de vida ou opinião.
    • Através de fatores sócio-culturais – tais como a classe social.
    • Através da demografia – tal como a idade, sexo, e assim por diante.

    Uma companhia avaliará cada segmento baseado no potencial sucesso do negócio. Oportunidades dependerão de fatos como: o potencial crescimento do seguimento, o estado de rivalidade do competidor dentro do seguimento, a quantidade de lucro que o seguimento fará, qual o tamanho do seguimento, como o seguimento se enquadra com a direção atual da companhia e sua visão.

    Image

    A Matriz de Segmentação de Negócios (Mapa de Batalha) é uma ferramenta útil para a seguimentação. Existem duas bases para a seguimentação. Neste exemplo nós usamos marcas de cervejas verso a idade dos consumidores. Depois disso os produtos são colocados na matriz. O resultado é um ´Mapa de Batalha`.

    SEGUIMENTOMETAPOSIÇÃO

    Segmentation, Demographics and Behavior

    Segmentation, Demographics and Behavior

    Segmentation is the process of breaking down the intended product market into manageable groups; it can be broken down by:

    Behavior

    • Needs—economic, functional, psychological, social.
    • Benefits–quality, service, economy, convenience, speed.
    • Attitude toward product--Enthusiastic, positive, indifferent, negative, hostile.
    • User status--Nonuser, ex user, potential user, first time user, regular user.
    • Loyalty status--None, medium, strong, absolute.
    • Brand Familiarity-Unaware, aware, informed, interested, desirous, intending to buy.
    • Occasion–Regular occasion; special occasion, convenience, comparison shopping, unsought product.
    • Type of problem solving needed-routine, limited, extensive.
    • Information required-low, medium, high.

    Geographic Location

    • Region of world, country— North America, South America, Africa, Asia, Europe.
    • Regions within that country— (For Example USA) Pacific Northwest, South, Midwest, New England.
    • Size of city— population under 5,000 people to 4 million or more.
    • Urban vs. rural— country, city, large city = more resources, more independence; country=more dependence on neighbors and pooling resources.
    • Climate— cold, hot, rainy, desert, beaches, mountains.

    Demographics

    • Income— under $5,000 to $250,000+ a year.
    • Gender— male, female, neither, both.
    • Age— Infant, toddler, preschool, tween (age 8 to 12), teen, college age, 20, 30, 40, 50, 60, 70-90.
    • Family size— 1 person, 2, 3, 4, 5 or more.
    • Family life cycle— young, single, engaged, DINKS (double income no kids), SINKS (single income no kids), married with kids (babies, toddler, elementary school age, teen, older), recently divorced, empty nester (children have moved out), same-sex couples, single parents, extended parents (grandparents raising their grandchildren), retired (either wealthy or Medicare dependent/poor). There are also Boomerang Kids (adult children have moved back home), Cougar/Silver Fox (Cougar is a 40-60 year old weathly, single, career driven woman seeking a younger man; Silver Fox is a 40-60 year old wealthy, single, career driven man seeking a younger woman).
    • Job— unemployed, housewife, part-time, full-time, student, professional, craftsperson, farmer, retired.
    • Education— grade school or less, some high school, high school graduate, some college, college graduate, graduate degrees.
    • Religion— Christian, Jewish, agnostic, atheist, Muslim, Islam etc.
    • Race— White, Black, Asian, Hispanic, Native American, mixed race, etc.
    • Culture/nationality—American, French, English, African, Russian, Indian etc.
    • Generation— (For Example USA) GI Generation, Silent, Matures, Baby Boomer, Gen X, Gen Y, Boomlets.

    Psychographics

    Psychographics
    VALS Lifetime Scale
    • Lifestyle— interests, hobbies, activities, interests, opinions, values, media preferences. Everyone has two lifestyles, the one they are in now, and the one they desire to be in, which is usually better than the current one. Almost all decisions are influenced by the buyer’s current and desired lifestyle.
    • Personality traits
      • Sincerity.
      • Excitement.
      • Competence.
      • Sophistication.
      • Ruggedness.
    • Social class— Lower, middle-low, middle, middle-upper, upper, upper-upper, working class, blue collar.
    • Relationship
    • Customer Type
    • Product Use
    • Buying Situation
    • Purchasing Method
    • Behavior
    • Geographic Location
    • Demographics
    • Psychographics

    Relationship

    • Kind of relationship— weak, strong, “arm’s length” dealing, close partnership.

    Customer Type

    • Type of customer— manufacturer, service, government, military, non profit, wholesaler, retailer, end user.
    Segmentation Groups
    The Segmentation Groups

    Product Use

    • How customer’s use product— installation, components, accessories, raw material, eaten, professional service.

    Buying Situation

    • Buying situation— rebuy, modified rebuy, new purchase.

    Purchasing Method

    • Purchasing methods— Internet, long term contract, warranty, financing, cash on demand.

    Return On Investment (ROI)


    Return On Investment (ROI)

    No company can hope to remain viable or even grow, without closely monitoring the effectiveness of its advertising. In the current economy no corner of a company’s expenses is going without scrutiny, especially marketing and promotion costs.

    The benefits of return on investment data works both ways, it may identify lost causes per strategy or locations. Conversely, the calculation might also highlight a strategy that deserves even more financial support.

    The negative results of making expenditures which do not contribute to profits are obvious. A company’s inherent marketing goal is to direct its efforts toward activities which produce a desired outcome, usually sales but could also include interim steps toward a sale, attendance at events, subscriptions, sample downloads and other such activities by its prospects.

    A popular method of measuring whether a firm is getting its money’s worth from promotions is by the calculation of Return On Investment (ROI). Return on Investment is a metric that measures profit associated with each investment. Although methods and approaches may vary the calculation below will yield a basic return on investment result:

    Return on Investment % = Profit – Investment / Investment (result expressed as percentage)

    Data needed to calculate Return On Investment (ROI):

    Annual Profits (income minus expenses)

    Annual Promotion Expenditures (costs per promotion measured)

    Obviously many other variables can be added to the mix to support particular promotion expenditure, but utilization of the formula above will aid in making key budget decisions within the marketing category. For example, with available data a company may be able to use the formula to compare promotion methods such as newspaper advertising, radio or direct mail. They might also be able to gather return on investment based on specific stores or even regions depending on company size.

    Sales Promotion

    Sales Promotion

    What is sales promotion?

    Sales promotion is any initiative undertaken by an organisation to promote an increase in sales, usage or trial of a product or service (i.e. initiatives that are not covered by the other elements of the marketing communications or promotions mix). Sales promotions are varied.

    (e) Free gifts e.g. Subway gave away a card with six spaces for stickers with each sandwich purchase. Once the card was full the consumer was given a free sandwich.

    (f) Discounted prices e.g. Budget airline such as EasyJet and Ryanair, e-mail their customers with the latest low-price deals once new flights are released, or additional destinations are announced.

    (g) Joint promotions between brands owned by a company, or with another company’s brands. For example fast food restaurants often run sales promotions where toys, relating to a specific movie release, are given away with promoted meals.

    (h)  Free samples (aka. sampling) e.g. tasting of food and drink at sampling points in supermarkets. For example Red Bull (a caffeinated fizzy drink) was given away to potential consumers at supermarkets, in high streets and at petrol stations (by a promotions team).

    (i) Vouchers and coupons, often seen in newspapers and magazines, on packs.

    (j) Competitions and prize draws, in newspapers, magazines, on the TV and radio, on The Internet, and on packs.

    (k) Cause-related and fair-trade products that raise money for charities, and the less well off farmers and producers, are becoming more popular.

    (l) Finance deals – for example, 0% finance over 3 years on selected vehicles.

    Many of the examples above are focused upon consumers. Don’t forget that promotions can be aimed at wholesales and distributors as well. These are known as Trade Sales Promotions. Examples here might include joint promotions between a manufacturer and a distributor, sales promotion leaflets and other materials (such as T-shirts), and incentives for distributor sales people and their retail clients.

    Often they are original and creative, and hence a comprehensive list of all available techniques is virtually impossible (since original sales promotions are launched daily!). Here are some examples of popular sales promotions activities:

    (a) Buy-One-Get-One-Free (BOGOF) – which is an example of a self-liquidating promotion. For example if a loaf of bread is priced at $1, and cost 10 cents to manufacture, if you sell two for $1, you are still in profit – especially if there is a corresponding increase in sales. This is known as a PREMIUM sales promotion tactic.

    (b) Customer Relationship Management (CRM) incentives such as bonus points or money off coupons. There are many examples of CRM, from banks to supermarkets.

    (c) New media – Websites and mobile phones that support a sales promotion. For example, in the United Kingdom, Nestle printed individual codes on KIT-KAT packaging, whereby a consumer would enter the code into a dynamic website to see if they had won a prize. Consumers could also text codes via their mobile phones to the same effect.

    (d) Merchandising additions such as dump bins, point-of-sale materials and product demonstrations.

    Restaurant Game

    The Restaurant Game

    Being creative using the restaurant game exercise.

    The restaurant game (Green 2008) is an exercise that you can use as a student in order to generate some really interesting and innovative creative ideas. The basis of the restaurant going is that you think of your product, concept or brand as a restaurant, and you ask yourself a series of questions about the restaurant. It starts like this:

      • What is the product?
      • What is it service?
      • What is its price?
      • Where is it located?
      • How is it promoted?
      • What is the customer experience?

    So you would answer these questions as if your brand were a restaurant. It’s that simple. Let’s have a look at a couple of examples.

    The Apple Restaurant, Head Chef Tim Cook.

    1. What is the product?

    The Apple restaurant serves a smorgasbord of tasty treats which are adored by its very loyal customers. Head Chef Tim Cook is the kitchen’s creative driving force and specialises in amuse bouche that delight his fans.

    2. What is it service?

    The level of service is very much focused upon each individual customer and their perceived need for the Apple brand. Some would say it is almost ritualistic and religious. Waiters and other staff are very enthusiastic about the food and the restaurant and this is communicated through their attitude.

    3. What is its price?

    The Apple restaurant is notorious for being rather expensive in comparison to similar restaurants. If you can’t afford it, don’t go into the restaurant. If you have to ask the price of the food you cannot afford it. Don’t expect any discounts.

    4. Where is it located?

    The Apple restaurant is located in secondary areas. It doesn’t depend on footfall for its visitors, since anybody that is into this kind of food would know where to find it.

    5. How is it promoted?

    The business would depend again on effective word-of-mouth. However, you would expect to find it in famous guides such as Egon Ronay or Michelin. You’ll probably read a review from a restaurant critic in the New York Times or Le Monde. You certainly would not see it advertised in the national press or any mainstream media. Reputation is everything.

    6. What is the customer experience?

    The customer experience is almost like visiting a church. The Apple restaurant delivers a religious experience, especially for the most loyal believers. The experience is wholesome and individual. No two visits will ever be the same, and the anticipation of a new and tasty treat is always on the mind of the Apple consumer, and no sooner have they left the restaurant, but they are planning their next pilgrimage.

    Other metaphors

    The restaurant game is useful as you can see from the two examples above. There must be a whole series of metaphors that could be used in this creative process. For example, if my brand was an animal, what would it be? If my brand was a rock band, what kind of music would it play? If my brand was a movie, what kind of movie would it be? Metaphors can make fun learning and teaching tools.

    The Facebook Restaurant, Head Chef Mark Zuckerberg.

    If Facebook was a restaurant, what would it be like?

    1. What is the product?

    The product which is offered by Facebook Marketing Mix is a social media experience. Individuals stay in touch with friends and keep them up to date with their activities. You can post messages, pictures, and so on. Facebook is immensely popular all the way around the world, it is currently free, although Facebook markets pay-per-click advertising and there are products and services which you can subscribe to. It is perceived as being a highly valuable company, although it often faces criticism because of privacy issues. The Facebook restaurant serves food (its product), which is simple and appeals to most people. It is tasty, value for money and is there a shared with friends.

    2. What is it service?

    The service provided in the Facebook restaurant is efficient. It is quick and easy to use, and the restaurant itself is clinically hygienic. This is a fast food restaurant. It is not à la carte and everybody gets the same level of service regardless.

    3. What is its price?

    The food in the Facebook restaurant is very competitively priced. Pricing strategies would include value strategies, and economy pricing.

    4. Where is it located?

    The restaurant would be located in primary areas, and the Facebook logo would act as a call to arms for any of the global Facebook customer population. There would be a lot of customer walking past the doors of the Facebook restaurant that might drop in on impulse.

    5. How is it promoted?

    Obviously promotion would be through word-of-mouth and reputation. The Facebook restaurant would not use mass marcoms media such as TV. Instead, it would invest wisely in focused public relations activities, as it did for its 2012 flotation.

    6. What is the customer experience?

    The customer experience would be rewarding. Customers would spend a lot of time in the Facebook restaurant, maybe more chatting and socialising rather than spending money on food. You would not get to know the maitre d’, and the experience would not generally be a personalised one. You would go again, and you would recommend it to friends. However, the Facebook restaurant is currently very fashionable. Marketers need to ask themselves how long this will last?

    Public Relations (PR)

    Public Relations (PR)

    Public relations as part of the marketing communications mix

    Public Relations (PR) is a single, broad concept. It is broad since it contains so many elements, many of which will be outlined in this lesson. Public Relations (PR) are any purposeful communications between an organisation and its publics that aim to generate goodwill.

    Speeches, presentations and speech writing.

    Key figures from within an organisation will write speeches to be delivered at corporate events, public awards and industry gatherings. PR company officials in liaison with company managers often write speeches and design corporate presentations. They are part of the planned and coherent strategy to build goodwill with publics. Presentations can be designed and pre-prepared by PR companies, ultimately to be delivered by company executives.

    Corporate literature e.g. financial reports.

    Corporate literature includes financial reports, in-house magazines, brochures, catalogues, price lists and any other piece of corporate derived literature. They communicate with a variety of publics. For example, financial reports will be of great interest to investors and the stock market, since they give all sorts of indicators of the health of a business. A company Chief Executive Officer CEO will often write the forward to an annual financial report where he or she has the opportunity to put a business case to the reader. This is all part of Public Relations.

    Publics, put simply, are its stakeholders. PR is proactive and future orientated, and has the goal of building and maintaining a positive perception of an organisation in the mind of its publics. This is often referred to as goodwill.

    Image

    Yes it is difficult to see the difference between marketing communications and PR since there is a lot of crossover. This makes it a tricky concept to learn. Added to this is the fact that PR is often expensive, and not free, as some definitions would have you believe. PR agencies are not cheap. Below are some of the approaches that are often considered under the PR banner.

    Interviews and photo-calls.

    It is important that company executives are available to generate goodwill for their organisation. Many undertake training in how to deal with the media, and how to behave in front of a camera. There are many key industrial figures that proactively deal with the media in a positive way for example Bill Gates (Microsoft) or Richard Branson (Virgin). Interviews with the business or mass media often allow a company to put its own perspective on matters that could be misleading if simply left to dwell untended the public domain.

    Public Relations (PR) Two

    Public Relations (PR)

    Public relations as part of the marketing communications mix

    Organising events.

    This has a direct business payoff. A more informal event could include a day at the races or a short-break abroad, where clients are wined and dined at the cost of a company, in order to generate goodwill. This has an indirect business payoff.

    Sponsorship and charitable donations.

    Sponsorship is where an organisation pays for their product or service to be associated with an activity or event. Organisations commonly sponsor sporting events and such as The Olympics, sporting stars and other celebrities, or medium, for example television programmes. The sponsors gain exposure, and also align their product or service with the attributes of the sport, celebrity or medium.

    Many companies (often those in profit!) make donations to charities and good causes. When donations are publicised, again the benefits generate goodwill for the organisation. It should be noted here that Microsoft’s Bill Gates donates substantial amounts to good causes that are often not reported. This is true corporate philanthropy.

    Corporate events are used to woo publics in both a formal and an informal manner. A formal corporate event could include a manufacturer inviting employees from all of its many distributors to visit its manufacturing plant for a training day.

    Facility visits.

    Visits to a factory, such as a chocolate factory, or a facility, such as a nuclear power plant also generate a positive perception of an organisation. In the case of a factory visit, loyal customers or other interested parties can experience for themselves what is behind a well-known product. In the case of a nuclear power plant, concerned or misinformed publics have the chance to see for themselves what really occurs behind locked doors. Here the organisation has the chance to deal with a delicate topic in a planned proactive manner. Public buildings such as parliament buildings or churches would be included under facility visits.

    Publicity events and ‘stunts.’

    Publicity events fall under the banner of guerrilla marketing. Here an organisation will take the opportunity to seize upon a particular moment to hijack public attention. Publicity events and stunts are practiced by both companies and private bodies (including pressure and political groups). A famous example of a publicity stunt was one conducted by Fathers For Justice (a British pressure group for divorced fathers), whereby individuals, dressed as Superheroes, invaded Buckingham Palace in London.

    Promotion

    Promotion

    Promotion is the marketing term used to describe all marketing communications activities and includes personal selling, sales promotion, public relations, direct marketing, trade fairs and exhibitions, advertising and sponsorship. Promotion needs to be precisely coordinated and integrated into the businesses global communications message, and this is called Integrated Marketing Communications (IMC). IMC integrates the message through the available channels to deliver a consistent and clear message about your company’s brands, products and services. Any movement away from the single message confuses the consumer and undermines the brand.

    The promotions mix (the marketing communications mix) is the specific blend of promotion tools that the company uses to persuasively communicate customer value and build customer relationships.

    Kotler et al (2010).

    Promotion is the element of the marketing mix which is entirely responsible for communicating the marketing proposition. Marketers work hard to create a unique marketing proposition for their product or service. McDonald’s is about community, food and enjoyment. Audi is about the driver experience and technology.

    Think of it like a cake mix, the basic ingredients are always the same. However if you vary the amounts of one of the ingredients, the final outcome is different. It is the same with promotions. You can integrate different aspects of the promotions mix to deliver a unique campaign. Now let’s look at the different elements of the promotions mix.

    The elements of the promotions mix are:

    • Personal Selling.
    • Sales Promotion.
    • Public Relations.
    • Direct Mail.
    • Trade Fairs and Exhibitions.
    • Advertising.
    • Sponsorship.

    And also online promotions.

    marketing communications process
    marketing communications process

    The elements of the promotions mix are integrated to form a coherent campaign. As with all forms of communication, the message from the marketer follows the ‘communications process’ as illustrated above. For example, a radio advert is made for a car manufacturer. The car manufacturer (sender) pays for a specific advert with contains a message specific to a target audience (encoding). It is transmitted during a set of commercials from a radio station (message/medium).

    The message is decoded by a car radio (decoding) and the target consumer interprets the message (receiver). He or she might visit a dealership or seek further information from a web site (Response). The consumer might buy a car or express an interest or dislike (feedback). This information will inform future elements of an integrated promotional campaign. Perhaps a direct mail campaign would push the consumer to the point of purchase. Noise represents the thousands of marketing communications that a consumer is exposed to everyday, all competing for attention.

    The Promotions Mix.

    Let us look at the individual components of the promotions mix in more detail. Remember all of the elements are ‘integrated’ to form a specific communications campaign.

    1. Personal Selling.

    Personal Selling is an effective way to manage personal customer relationships. The sales person acts on behalf of the organization. They tend to be well trained in the approaches and techniques of personal selling. However sales people are very expensive and should only be used where there is a genuine return on investment. For example salesmen are often used to sell cars or home improvements where the margin is high.

    2. Sales Promotion.

    .

    Sales promotions tend to be thought of as being all promotions apart from advertising, personal selling, and public relations. For example the BOGOF promotion, or Buy One Get One Free. Others include couponing, money-off promotions, competitions, free accessories (such as free blades with a new razor), introductory offers (such as buy digital TV and get free installation), and so on. Each sales promotion should be carefully costed and compared with the next best alternative.

    3. Public Relations (PR).

    Public Relations is defined as ‘the deliberate, planned and sustained effort to establish and maintain mutual understanding between an organization and its publics’ (Institute of Public Relations). PR can be relatively cheap, but it is certainly not free. Successful strategies tend to be long-term and plan for all eventualities. All airlines exploit PR; just watch what happens when there is an incident. The pre-planned PR machine clicks in very quickly with a very effective rehearsed plan.

    4. Direct Marketing.

    Direct marketing is any marketing undertaken without a distributor or intermediary. In terms of promotion it means that the marketing company has direct communication with the customer. For example Nintendo distributes via retailers, although you can register directly with them for information which is often delivered by e-mail or mail.

    Direct mail is very highly focussed upon targeting consumers based upon a database. As with all marketing, the potential consumer is targeted based upon a series of attributes and similarities. Creative agencies work with marketers to design a highly focussed communication in the form of a mailing. The mail is sent out to the potential consumers and responses are carefully monitored. For example, if you are marketing medical text books, you would use a database of doctors’ surgeries as the basis of your mail shot.

    Similarly e-mail is a form of online direct marketing. You register, or opt in, to join a mailing list for your favourite website. You confirm that you have opted in, and then you will receive newsletters and e-mails based upon your favourite topics. You need to be able to unsubscribe at any time, or opt out. Mailing lists which generate sales are like gold dust to the online marketer. Make sure that you use a mailing list with integrity just as you would expect when you sign up. The mailing list needs to be kept up-to-date, and often forms the basis of online Customer Relationship Management (CRM).

    5. Trade Fairs and Exhibitions.

    Such approaches are very good for making new contacts and renewing old ones. Companies will seldom sell much at such events. The purpose is to increase awareness and to encourage trial. They offer the opportunity for companies to meet with both the trade and the consumer.

    6. Advertising.

    Advertising is a ‘paid for’ communication. It is used to develop attitudes, create awareness, and transmit information in order to gain a response from the target market. There are many advertising ‘media’ such as newspapers (local, national, free, trade), magazines and journals, television (local, national, terrestrial, satellite) cinema, outdoor advertising (such as posters, bus sides). There is much more about digital, online and Internet advertising further down this pages, as well as throughout Marketing Teacher and the Marketing Teacher Blog.

    7. Sponsorship.

    Sponsorship is where an organization pays to be associated with a particular event, cause or image. Companies will sponsor sports events such as the Olympics or Formula One. The attributes of the event are then associated with the sponsoring organization.

    The elements of the promotional mix are then integrated to form a unique, but coherent campaign.

    Online Promotions

    Online promotions will include many of the promotions mix elements which we considered above. For example advertising exists online with pay per click advertising which is marketed by Google. You can sponsor are website for example. Online businesses regularly send out newsletters which are targeted using e-mail and mailing lists, which is a form of direct marketing. Indeed websites are premium vehicle in the public relations industry to communicate particular points of view to relevant publics.

    The online promotions field is indeed emerging. The field will soon spread into Geo targeting of adverts to people in specific locations via smart phones. Another example would be how social media targets adverts to you whilst you socialising online. Take a look at Marketing Teacher’s Blog for more up-to-date examples of the emerging online promotions space.

    Public Relations (PR) Three

    Public Relations (PR)

    Public relations as part of the marketing communications mix

    Product placement in media.

    This is an interesting and original use of PR. There are very many examples in movies and TV programmes that ‘place’ products.

    Media conferences are called often at short notice to inform the media directly on a current event that has just happened, or that is about to happen. Media contact includes interviews with key personnel, and could include speeches, presentations and speech writing by the PR company. Finally entertaining the press, or media, is undertaken when trying to gain as much media space as possible. This could be for a product launch or to promote an acquisition.

    Advertorials in newspapers, magazines or on websites.

    Advertorials are paid for advertisements that are designed to appear like copy (i.e. normal reported text). Many countries insist that advertorials do contain a line of text to explain that they are sponsored or placed by an advertiser. Advertorials are often used to imply that some ground breaking treatment or solution has been uncovered.

    Corporate promotional materials, websites, in-house magazines and customer magazines.

    The market for promotional materials is large. Promotional materials include items such as pens, balloons, mouse mats, and so on. They tend to carry a company’s logo and contact details, and are another way to promote goodwill between and organisation and its publics. Websites are a vital marketing communications and public relations tool that can convey information to publics on how to contact an organisation, key personnel, products and services, corporate history, and financial reports, as well as any other targeted and planned information.

    In-house magazines are used for internal marketing, communication and change management from within the organisation. In-house magazines are targeted at internal publics. Conversely, customer magazines help organisations to communicate with external publics (mainly customers) on all sorts of topics such as good news stories, product launches, customer clubs and many other subjects.

    For example, a car manufacturer places a car in a movie and the hero drives it, or wears a watch that is looked at by the villain displaying the time, underscored by the manufacturer’s logo. Today, computer games include banners and posters during game-play as the action unfolds. Examples of product placement in games would include field sports with adverts placed alongside a pitch, or car racing games where you pass billboards displayed in a city.

    Lobbying government bodies.

    Lobbying is named after the ‘lobby’ area of the British Houses of Parliament where traditionally ‘lobbying’ would have occurred. Lobby in the past would have meant catching the eye of a Member of Parliament, in order to persuade him or her to take up a particular cause or argument. Today, lobbying firms are hired by organisations or individuals with a specific cause to promote. For example, a charity could lobby for a change in laws regarding pharmaceuticals or armaments. The charity would hire a lobbying firm to promote their cause with elected politicians.

    Press or media releases, conferences, contact and entertainment.

    Press or media releases, conferences, contact and entertainment are pivotal Public Relations strategies. In the past, the press were the original target (e.g. newspapers and magazines) but today the whole media industry forms the target (i.e. radio, websites, TV, New Media and so on). Media releases are drafted by a PR company, for example, to report financial information prior to the release of company reports.

    Promoção

    Promoção

    Outro dos 4Ps é ‘promoção’

    Este inclui todas as ferramentas disponíveis para o comerciante para a ‘comunicação de marketing’. Como na mistura de marketing de Neil H. Borden, comunicações de marketing têm suas próprias ‘mistura de promoções’. Pense nisso como uma mistura de bolo, os ingredientes básicos são sempre os mesmos. Apesar disso, se você varia a quantidade de um dos ingredientes, o resultado final será diferente. O mesmo ocorre com promoções. Você pode integrar diferentes aspectos da mistura de promoções para atingir uma campanha única.

    Os elementos da mistura (composto) de promoções são:

    • Venda Pessoal.
    • Promoção de Vendas.
    • Relações Públicas.
    • Correspondência direta.
    • Feira de Comércio e Exibições.
    • Propaganda.
    • Patrocínio.Image

    Os elementos da mistura (composto) de promoções são integradas para formar uma campanha coerente. Como todas as formas de comunicação. A mensagem do comerciante segue o ‘processo de comunicação’ como está ilustrado acima. Por exemplo, um anúncio de rádio é feito para um produto de carros. O produtor do carro (remetente) paga por um anúncio específico o qual contém uma mensagem específica para a audiência-alvo (codificação). Este é transmitido durante uma série de comerciais de uma estação de rádio (mensagem / mídia).

    A mensagem é decodificada por um rádio de carro (decodificação) e o consuminidor-alvo interpreta a mensagem (recebedor). Ele ou ela podem visitar uma concessionária ou procurar por mais informação através de um web site (resposta). O consumidor pode comprar um carro ou expressar um interesse ou desinteresse (feedback). Esta informação informará futuros elementos de uma campanha promocional integrada. Possivelmente uma campanha de correspondência ‘direta’ influenciará o consumidor ao ponto da compra. Barulho representa as milhares de comunicações de marketing que o consumidor é exposto todos os dias, todos competindo por atenção.

    A Mistura de Promoções.

    Vamos olhar os componentes individuais da mistura (composto) de promoções em mais detalhes. Se lembre que todos os elementos são ‘integrados’ para formar uma campanha de comunicação específica.

    1. Venda Pessoal.

    Venda Pessoal é um meio eficaz para lidar com relacionamento pessoal com clientes. O vendedor atua em nome da organização. Ele tende a ser bem treinado na abordagem e técnicas de venda pessoal. Apesar disso, vendedores são muito caros e devem ser usados apenas onde existir um retorno sobre o investimento. Por exemplo: vendedores são muitas vezes usados para vender carros e casas onde a margem é alta.

    2. Promoção de Vendas.

    Promoção de vendas tende a ser vista como todos os tipos de promoção a não ser propaganda, venda pessoal e relações públicas. Por exemplo: uma promoção onde você compra um e ganha outro gratuitamente. Outros incluem cupons, descontos, competições, acessórios gratuitos (como uma lamina grátis com a compra de um barbeador), ofertas introdutórias (tais como: compre uma TV digital e ganhe a instalação gratuita), e muitos outros. Cada promoção de vendas deverá ser cuidadosamente avaliada e comparada com a segunda melhor alternativa.

    3. Relações Públicas.

    Relações Públicas é definida como ‘o deliberado, planejado e sustentável esforço para estabelecer e manter entendimento mutuou entre uma organização e seu público’ (Intuito de Relações Públicas). Relativamente barato, mas certamente não tão barato. Estratégias sucessivas tendem a serem de longo prazo e planejadas para todas eventualidades. Todas linhas aéreas exploram Relações Públicas; apenas veja o que acontece quando algum desastre acontece. Uma pré planejada ‘máquina’ de Relações Públicas atua rapidamente com um plano de reversão bem eficaz.

    4. Correspondência Direta.

    Correspondência direta é altamente focada em consumidores-alvo baseado em um banco de dados. Como com todo marketing, o potencial cliente é ‘definido’ baseado em uma série de atributos e similaridades. Agencias criativas trabalham com consumidores para desenhar uma comunicação altamente focada na forma de uma correspondência. A correspondência é enviada ao potencial cliente e respostas são cuidadosamente monitoradas. Por exemplo: se você estiver promovendo livros de medicina, você deverá usar um banco de dados contendo médicos (hospitais) como base para onde deverá enviar sua correspondência.

    5. Feira de Comércio e Exibições.

    Tais meios são excelentes para fazer novos contados e renovar contados antigos. Companhias raramente venderão muito em eventos como estes. A intenção é de tornar um produto ou serviço conhecido e encorajar a compra. Eles oferecem a oportunidade para companhias se reunirem com ambos o comércio e o comerciante. Expo recentemente finalizou na Alemanha com o próximo planejado para o Japão em 2005, apesar de uma recente diminuição de interesse em eventos como estes.

    6. Propaganda.

    Propaganda é um meio de comunicação ‘pago’. Ele é usado para desenvolver atitudes, criar conhecimento e transmitir informação para o ganho de uma resposta do mercado-alvo. Existem muitos meios de propaganda tais como jornais (locais, nacionais, gratuitos, comerciais), revistas, televisão (local, nacional, terrestre, satélite), cinema, promoção nas ruas (como pôsteres, anúncios em ônibus).

    7. Patrocínio.

    Patrocínio é onde uma organização paga para ser associada a um evento particular, causa ou imagem. Companhias patrocinarão eventos esportivos, tais como as Olimpíadas ou a Formula 1. Os atributos de um evento são associados à organização patrocinadora.

    Os elementos da mistura (composto) promocional são integradas para formar uma campanha única mas coerente.

    Profit and Loss Statement

    Profit and Loss Statement

    Profit and Loss Statement Lesson

    The Profit and Loss statement is one of the main business financial statements. Among the various financial statements, a Profit and Loss statement most closely resembles what is referred to as "the bottom line". Since the purpose of a business is to earn a profit, both the business owner and outside entities such as bankers and investors have a keen interest in revenues.

    The last stage in the development of a company’s Profit and Loss Statement is to outline a list of expenses associated with the ongoing operations of a company. Typical items displayed include utilities, rent and salaries. Just as income interest earned is reflected among income items, a company should also show display interest paid among its expenses. The sum of all expenses is obviously – Total Expenses.

    The final step in the Profit and Loss Statement is the resulting of calculating the result of subtracting Total Expenses from Total Income, the result of which is called Net Income.

    A Profit and Loss Statement provides a snapshot of a firms’ financial viability for a certain period of time, usually one year. Therefore, the "bottom line" reveals the company’s net earnings or losses. Net is a key term, because after the warm glow of sales income is felt, then comes the reality check of expenses and other costs which eat into profits.

    Among the common components found in an income statement are net sales, the costs of goods sold, the costs of inventory if applicable, and regular expenses such as office rent, payroll, supplies, etc? When both negative and positive finances elements are revealed on an income statement, key components contributing to profit or loss for the period can be identified.

    The structure of a Profit and Loss Statement begins by showing income received. Any financial impacts which reduce income, such as customer returns, must be are reflected.After all gross sales and negative financial impacts on those sales are taken into account; the company arrives at a Net Sales figure.

    Of course, it costs a company to set up and prepare to provide products or services. These costs are reflected in the next section of the Profit and Loss Statement called the Cost of Goods Sold. Among typical costs outlined in this section are purchases for inventory or other costs associated with preparing a product to sell. The cost of Inventory (minus depreciation) value purchased but not yet utilized is subtracted before a sum total of Cost of Goods Sold is derived.

    Once all costs are associated with product preparation are accounted for, the Profit and Loss Statement subtracts this figure to arrive at the Company’s Gross Profit. All cash flow coming into a company is not limited to that earned in actual sales transactions. The company may also experience increased income from the interest paid on its accounts.After all sources of income are included, the Profit and Loss Statement shows the company’s Total Income.

    Pricing Strategies

     

    In terms of the marketing mix some would say that pricing is the least attractive element. Marketing companies should really focus on generating as high a margin as possible. The argument is that the marketer should change product, place or promotion in some way before resorting to pricing reductions. However price is a versatile element of the mix as we will see.

    marketing pricing
    marketing pricing

    Penetration Pricing.

    The price charged for products and services is set artificially low in order to gain market share. Once this is achieved, the price is increased. This approach was used by France Telecom and Sky TV. These companies need to land grab large numbers of consumers to make it worth their while, so they offer free telephones or satellite dishes at discounted rates in order to get people to sign up for their services. Once there is a large number of subscribers prices gradually creep up. Taking Sky TV for example, or any cable or satellite company, when there is a premium movie or sporting event prices are at their highest – so they move from a penetration approach to more of a skimming/premium pricing approach.

    Economy Pricing.

    This is a no frills low price. The costs of marketing and promoting a product are kept to a minimum. Supermarkets often have economy brands for soups, spaghetti, etc. Budget airlines are famous for keeping their overheads as low as possible and then giving the consumer a relatively lower price to fill an aircraft. The first few seats are sold at a very cheap price (almost a promotional price) and the middle majority are economy seats, with the highest price being paid for the last few seats on a flight (which would be a premium pricing strategy). During times of recession economy pricing sees more sales. However it is not the same as a value pricing approach which we come to shortly.

    Price Skimming.

    Price skimming sees a company charge a higher price because it has a substantial competitive advantage. However, the advantage tends not to be sustainable. The high price attracts new competitors into the market, and the price inevitably falls due to increased supply.

    Manufacturers of digital watches used a skimming approach in the 1970s. Once other manufacturers were tempted into the market and the watches were produced at a lower unit cost, other marketing strategies and pricing approaches are implemented. New products were developed and the market for watches gained a reputation for innovation.

     

    The diagram depicts four key pricing strategies namely premium pricing, penetration pricing, economy pricing, and price skimming which are the four main pricing policies/strategies. They form the bases for the exercise. However there are other important approaches to pricing, and we cover them throughout the entirety of this lesson.

    Psychological Pricing.

    This approach is used when the marketer wants the consumer to respond on an emotional, rather than rational basis. For example Price Point Perspective (PPP) 0.99 Cents not 1 US Dollar. It’s strange how consumers use price as an indicator of all sorts of factors, especially when they are in unfamiliar markets. Consumers might practice a decision avoidance approach when buying products in an unfamiliar setting, an example being when buying ice cream. What would you like, an ice cream at $0.75, $1.25 or $2.00? The choice is yours. Maybe you’re entering an entirely new market. Let’s say that you’re buying a lawnmower for the first time and know nothing about garden equipment. Would you automatically by the cheapest? Would you buy the most expensive? Or, would you go for a lawnmower somewhere in the middle? Price therefore may be an indication of quality or benefits in unfamiliar markets.

    Product Line Pricing.

    Where there is a range of products or services the pricing reflects the benefits of parts of the range. For example car washes; a basic wash could be $2, a wash and wax $4 and the whole package for $6. Product line pricing seldom reflects the cost of making the product since it delivers a range of prices that a consumer perceives as being fair incrementally – over the range.

    If you buy chocolate bars or potato chips (crisps) you expect to pay X for a single packet, although if you buy a family pack which is 5 times bigger, you expect to pay less than 5X the price. The cost of making and distributing large family packs of chocolate/chips could be far more expensive. It might benefit the manufacturer to sell them singly in terms of profit margin, although they price over the whole line. Profit is made on the range rather than single items.


    Optional Product Pricing.

    Companies will attempt to increase the amount customers spend once they start to buy. Optional ‘extras’ increase the overall price of the product or service. For example airlines will charge for optional extras such as guaranteeing a window seat or reserving a row of seats next to each other. Again budget airlines are prime users of this approach when they charge you extra for additional luggage or extra legroom.

    Captive Product Pricing

    Where products have complements, companies will charge a premium price since the consumer has no choice. For example a razor manufacturer will charge a low price for the first plastic razor and recoup its margin (and more) from the sale of the blades that fit the razor. Another example is where printer manufacturers will sell you an inkjet printer at a low price. In this instance the inkjet company knows that once you run out of the consumable ink you need to buy more, and this tends to be relatively expensive. Again the cartridges are not interchangeable and you have no choice.

    Product Bundle Pricing.

    Here sellers combine several products in the same package. This also serves to move old stock. Blu-ray and videogames are often sold using the bundle approach once they reach the end of their product life cycle. You might also see product bundle pricing with the sale of items at auction, where an attractive item may be included in a lot with a box of less interesting things so that you must bid for the entire lot. It’s a good way of moving slow selling products, and in a way is another form of promotional pricing.

    Promotional Pricing.

    Pricing to promote a product is a very common application. There are many examples of promotional pricing including approaches such as BOGOF (Buy One Get One Free), money off vouchers and discounts. Promotional pricing is often the subject of controversy. Many countries have laws which govern the amount of time that a product should be sold at its original higher price before it can be discounted. Sales are extravaganzas of promotional pricing!

    Geographical Pricing.

    Geographical pricing sees variations in price in different parts of the world. For example rarity value, or where shipping costs increase price. In some countries there is more tax on certain types of product which makes them more or less expensive, or legislation which limits how many products might be imported again raising price. Some countries tax inelastic goods such as alcohol or petrol in order to increase revenue, and it is noticeable when you do travel overseas that sometimes goods are much cheaper, or expensive of course.

    Value Pricing.

    This approach is used where external factors such as recession or increased competition force companies to provide value products and services to retain sales e.g. value meals at McDonalds and other fast-food restaurants. Value price means that you get great value for money i.e. the price that you pay makes you feel that you are getting a lot of product. In many ways it is similar to economy pricing. One must not make the mistake to think that there is added value in terms of the product or service. Reducing price does not generally increase value.

    See also eMarketing Price and international Marketing price.

    Our financial objectives in terms of price will be secured on how much money we intend to make from a product, how much we can sell, and what market share will get in relation to competitors. Objectives such as these and how a business generates profit in comparison to the cost of production, need to be taken into account when selecting the right pricing strategy for your mix. The marketer needs to be aware of its competitive position. The marketing mix should take into account what customers expect in terms of price.

    There are many ways to price a product. Let’s have a look at some of them and try to understand the best policy/strategy in various situations.

    Premium Pricing.

    Use a high price where there is a unique brand. This approach is used where a substantial competitive advantage exists and the marketer is safe in the knowledge that they can charge a relatively higher price. Such high prices are charged for luxuries such as Cunard Cruises, Savoy Hotel rooms, and first class air travel.

    Process – Marketing Mix

    Process

    Process as part of the marketing mix

    Process is another element of the services marketing mix or 7Ps.There is a number of perceptions of the concept of process within the business and marketing literature. Some see processes as a means to achieve an outcome, for example – to achieve a 30% market share, a company implements a marketing planning process.

    At each stage of the process, marketers:

    • Deliver value through all elements of the marketing mix. Process, physical evidence and people enhance services.
    • Feedback can be taken and the mix can be altered.
    • Customers are retained, and other services or products are extended and marked to them.
    • The process itself can be tailored to the needs of different individuals, experiencing a similar service at the same time.

    Processes essentially have inputs, throughputs and outputs (or outcomes). Marketing adds value to each of the stages. Take a look at the lesson on value chain analysis to consider a series of processes at work.

    There are a number of types of processes. Technological processes include the process of manufacturing goods and adapting them for the needs of clients. For example Rolls-Royce motor cars will build a Phantom which is adapted to the requirements of each individual client. There are also electronic processes which include things like Electronic Point-Of-Sale (EPOS), barcodes on products which are scanned on phones or by checkout people and other means such as loyalty cards.

    Processes include direct activities and indirect activities. Direct activities add value at the customer interface as the consumer experiences the service. Many processes are supported by indirect activities, often known as back office activities, which support the service before, during and after it has been consumed.

    Another view is that marketing has a number of processes that integrate together to create an overall marketing process, for example – telemarketing and Internet marketing can be integrated. A further view is that marketing processes are used to control the marketing mix, i.e. processes that measure the achievement of marketing objectives. All views are understandable, but not particularly customer focused.

    For the purposes of the marketing mix, process is an element of service that sees the customer experiencing an organization’s offering. It’s best viewed as something that your customer participates in at different points in time. Here are some examples to help you build a picture of a marketing process, from the customer’s point of view.

    Going on a cruise – from the moment that you arrive at the dockside, you are greeted; your baggage is taken to your room. You have two weeks of services from restaurants and evening entertainment, to casinos and shopping. Finally, you arrive at your destination, and your baggage is delivered to you. This is a highly focused marketing process, and is an example of the importance of process in enabling delivery of the customer proposition. Another way of looking at this example is that there is end to end service support, which has enabled transactions between the company and its customers. There are other ways in which the process supports the customer experience as we will see from the next section.

    Product Life Cycle (PLC)


    The Product Life Cycle (PLC)

    The Product Life Cycle (PLC) is based upon the biological life cycle. For example, a seed is planted (introduction); it begins to sprout (growth); it shoots out leaves and puts down roots as it becomes an adult (maturity); after a long period as an adult the plant begins to shrink and die out (decline).

    Decline.

    At this point there is a downturn in the market. For example more innovative products are introduced or consumer tastes have changed. There is intense price-cutting and many more products are withdrawn from the market. Profits can be improved by reducing marketing spend and cost cutting.

    Product Life Cycle

    Problems with Product Life Cycle.

    In reality very few products follow such a prescriptive cycle. The length of each stage varies enormously. The decisions of marketers can change the stage, for example from maturity to decline by price-cutting. Not all products go through each stage. Some go from introduction to decline. It is not easy to tell which stage the product is in. Remember that PLC is like all other tools. Use it to inform your gut feeling.

    Another marketing tool for evaluating PRODUCT is the Three Levels of a Product.

    In theory it’s the same for a product. After a period of development it is introduced or launched into the market; it gains more and more customers as it grows; eventually the market stabilises and the product becomes mature; then after a period of time the product is overtaken by development and the introduction of superior competitors, it goes into decline and is eventually withdrawn.

    The Product Life Cycle (PLC) is based upon the biological life cycle. For example, a seed is planted (introduction); it begins to sprout (growth); it shoots out leaves and puts down roots as it becomes an adult (maturity); after a long period as an adult the plant begins to shrink and die out (decline).

    In theory it’s the same for a product. After a period of development it is introduced or launched into the market; it gains more and more customers as it grows; eventually the market stabilises and the product becomes mature; then after a period of time the product is overtaken by development and the introduction of superior competitors, it goes into decline and is eventually withdrawn.

    However, most products fail in the introduction phase. Others have very cyclical maturity phases where declines see the product promoted to regain customers.


    Strategies for the differing stages of the Product Life Cycle.

    Introduction.

    The need for immediate profit is not a pressure. The product is promoted to create awareness. If the product has no or few competitors, a skimming price strategy is employed. Limited numbers of product are available in few channels of distribution.

    Growth.

    Competitors are attracted into the market with very similar offerings. Products become more profitable and companies form alliances, joint ventures and take each other over. Advertising spend is high and focuses upon building brand. Market share tends to stabilise.

    Maturity.

    Those products that survive the earlier stages tend to spend longest in this phase. Sales grow at a decreasing rate and then stabilise. Producers attempt to differentiate products and brands are key to this. Price wars and intense competition occur. At this point the market reaches saturation. Producers begin to leave the market due to poor margins. Promotion becomes more widespread and use a greater variety of media.

    O Ciclo de Vida do Produto (CVP)

    O Ciclo de Vida do Produto (CVP)

    O Ciclo de Vida do Produto (CVP) é baseado no ciclo de vida biológico. Por exemplo: uma semente é plantada (introdução); ela começa a brotar (crescimento); dela nasce folhas e se enraíza ao se tornar adulta (maturidade); depois de um longo período como um adulto a planta começa a murchar e morre (declínio).

    Declínio

    Neste ponto ocorre uma diminuição no mercado. Por exemplo: produtos mais inovadores são introduzidos ou o gosto de consumidores está mudado. Há intenso corte de preços e muitos mais produtos são retirados do mercado. O lucro pode ser aumentado através de redução do dinheiro gasto com marketing e corte de custos.

    Problemas com o Ciclo de Vida do Produto

    Em realidade muito poucos produtos seguem um ciclo tão prescrito. O período de cada estágio varia enormemente. As decisões de comerciantes podem mudar o estágio, por exemplo: da maturidade ao declínio causado pela diminuição de preços. Nem todos os produtos passam por cada estágio. Alguns vão da introdução ao declínio. Não é fácil dizer em qual estágio o produto está. Se lembre que o CVP é como todas as outras ferramentas de análise. O use como uma forma de auxílio.

    Outra ferramenta do marketing para avaliar um produto é o Três Níveis de um Produto

    Teoricamente o mesmo acontece a um produto. Depois do período de desenvolvimento ele é introduzido ou lançado no mercado; ele ganha mais e mais clientes ao longo do tempo; eventualmente o mercado se estabiliza e o produto se torna maduro; então depois de um tempo o produto se torna ultrapassado pelo desenvolvimento e introdução de competidores superiores, ele encara sua fase de declínio e é eventualmente retirado do mercado. Apesar disso, muitos produtos falham na fase introdutória. Outros têm fases de maturidade muito cíclicas onde com o declínio têm o produto promovido para resgatar clientes.

    PLC

    Estratégicas para os estágios de diferenciação do Ciclo de Vida do Produto.

    Introdução

    A necessidade de lucro imediato não é uma pressão. O produto é promovido para que ele se torne conhecido. Se o produto não tem ou tem apenas alguns competidores, uma estratégia ´skimming´ de preço é aplicada, onde se deve concentrar em um grupo específico de clientes os quais não se importarão de pagar um preço mais alto ao produto. Um número limitado de produtos estão disponíveis em poucos canais de distribuição.

    Crescimento

    Competidores são atraídos ao mercado com ofertas muitos similares. Produtos se tornam mais lucrativos e companhias formam alianças, tomam riscos conjuntos e se tornam parte uma da outra. O gasto com propaganda é alto e se foca no crescimento da marca do produto. Market share (fatia do mercado) tende-se a estabilizar.

    Maturidade

    Os produtos que sobrevivem nos primeiros estágios tendem a gastar mais tempo nesta fase. O número de vendas alcançam uma taxa de crescimento e se estabiliza. A tentativa de produtores para diferenciar seus produtos e marcas é um ponto chave nesta fase. A guerra de preços e intensa competição ocorre. Neste ponto o mercado alcança saturação. Produtores começam a deixar o mercado por baixas margens de venda. Promoção se torna mais difundida e a midia é utilizada com mais variedade.

    Marketing Place

    Marketing Place

    (A marketing channel is) . . . a set of interdependent organisations that help make a product or service available for use or consumption by the consumer or business user.

    Kotler et al (2010)

    A channel of distribution comprises a set of institutions which perform all of the activities utilised to move a product and its title from production to consumption.

    Bucklin – Theory of Distribution Channel Structure (1966)

    The Bucklin definition above albeit more than 50 years old still represents the basic concept of place in the marketing mix.

    Marketing place has a number of names. Place is also known as channel, distribution or intermediary. It is the mechanism through which goods and/or services are moved from the manufacturer/ service provider to the user or consumer. So let’s take a look at some basic distribution or channel decisions, and how we decide on the best distribution channel for our product or service.

    There are six basic ‘channel’ decisions:

    • Do we use direct or indirect channels? (e.g. ‘direct’ to a consumer, ‘indirect’ via a wholesaler).
    • Single or multiple channels.
    • Cumulative length of the multiple channels.
    • Types of intermediary (see later).
    • Number of intermediaries at each level (e.g. How many retailers in southern Spain?).
    • Which companies as intermediaries to avoid ‘intrachannel conflict’ (i.e. infighting between local distributors).

    Selection Consideration – how do we decide upon a distributor?

    • Market segment – the distributor must be familiar with your target consumer and segment.
    • Changes during the Product Life Cycle – different channels can be exploited at different points in the PLC e.g. Foldaway scooters are now available everywhere. Once they were sold via a few specific stores.
    • Producer/distributor fit – Is there a match between their polices, strategies, image, and yours? Look for ‘synergy’.
    • Qualification assessment – establish the experience and track record of your intermediary.
    • How much training and support will your distributor require?

    As you will be aware from your experiences as a consumer, producers rarely sell their goods or services directly to the person that consumes them. Marketing channels, or place in terms of the marketing mix, are the means by which interdependent organizations move products or services from the producer to the person that purchases or consumes the product. This is the basic role of distribution.

    Different customers have different needs. Customers in different segments have different needs, for example a food distributor will sell flour in different ways when it sells to a hotel as opposed to when the sales to a wholesaler. A business customer will have different needs to a retail customer, for example a stationary distributor will sell printer paper in bulk directly to a large company but will sell a single ream (500 sheets) indirectly to the average householder via his local stationery store.

    Types of Channel Intermediaries.

    There are many types of intermediaries including wholesalers, agents, retailers, the Internet, licensing and franchising. The main modes of distribution will be looked at in more detail as follows:

    Channel Intermediaries – Wholesalers

    • They break down ‘bulk’ into smaller packages for resale by a retailer.
    • They buy from producers and resell to retailers. They take ownership or ‘title’ to goods whereas agents do not (see below).
    • They provide storage facilities. For example, cheese manufacturers seldom wait for their product to mature. They sell on to a wholesaler that will store it and eventually resell to a retailer.
    • Wholesalers offen reduce the physical contact cost between the producer and consumer e.g. customer service costs, or sales force costs.
    • A wholesaler will often take on some of the marketing responsibilities. Many produce their own brochures and use their own telesales operations.

    Channel Intermediaries – Agents

    • Agents are mainly used in international markets.
    • An agent will typically secure an order for a producer and will take a commission. They do not tend to take title to the goods. This means that capital is not tied up in goods. However, a ‘stockist agent’ will hold consignment stock (i.e. will store the stock, but the title will remain with the producer. This approach is used where goods need to get into a market soon after the order is placed e.g. foodstuffs).
    • Agents can be very expensive to train. They are difficult to keep control of due to the physical distances involved. They are difficult to motivate.

    Channel Intermediaries – Retailers

    • Retailers will have a much stronger personal relationship with the consumer.
    • The retailer will hold several other brands and products. A consumer will expect to be exposed to many products.
    • Retailers will often offer credit to the customer e.g. electrical wholesalers, or travel agents.
    • Products and services are promoted and merchandised by the retailer.
    • The retailer will give the final selling price to the product.
    • Retailers often have a strong ‘brand’ themselves e.g. Ross and Wall-Mart in the USA, and Alisuper, Modelo, and Jumbo in Portugal.

    Channel Intermediaries – Internet

    • The Internet has a geographically dispersed market.
    • The main benefit of the Internet is that niche products reach a wider audience e.g.
      Scottish salmon direct from an Inverness fishery.
    • There are low barriers to entry as set up costs are relatively small.
    • Use e-commerce technology (for payment, shopping software, etc)
    • There is a paradigm shift in commerce and consumption which benefits distribution via the Internet

    There is a huge growth in online retailing. People buy physical products from companies such as Amazon or eBay, as well as a whole plethora of other smaller retailers marketing in a wide variety of small niches, also known as the long thin tail of marketing. There are many transaction related products such as theatre tickets and software upgrades that can be bought solely online. One way of segmenting Internet users was identified by McKinsey in 2000 and is summarised here as follows:

    Simplifiers – experienced Internet users who seek convenience and low prices.

    Surfers – an innovative minority who enjoy buying niche items and experiences based upon their own initiative.

    Bargainers – price sensitive surfers looking for the best price.

    Connectors – those new to the Internet who want to connect with others via Facebook and Twitter, with little knowledge to go much further.

    Routiners – who have a small number of favourite sites which they visit often, such as online banking for example.

    Sportsters – who spend most of their time looking at entertainment and sport.

    Which of the above best represent you and your buyer behaviour when you are online?

    Licensing and franchising

    Some businesses are hothouses of ideas and innovation but they may lack expertise in terms of business and finance. In these situations licensing or franchising are an ideal option.

    Licensing is essentially a contract which allows another business to manufacture or provide a service which conforms to your licence. Licensing is useful if the business wishes to quickly move into foreign countries, if manufacturing in a local market is too expensive then manufacturing could be undertaken overseas under licence, if shipping costs are too expensive or perhaps a market overseas would prefer a locally branded item. In return the licensee will get fees, will be able to penetrate a wide range of overseas markets, generally can control quality and production levels, and ultimately will be able to introduce new models as they arise.

    Franchising is similar to licensing but tends to be used where there is a brand name or a particular format that a company owns. There are lots of familiar examples of franchising including KFC and many familiar high street and mall names – marketing everything from hamburgers to jewellery. Try to identify some franchises the next time that you go for a day out shopping.

    Changing roles of logistics

    Place also includes logistics. Logistics historically were largely about the physical distribution of goods from manufacturer to consumer by road and rail, sea and air. Logistics has undergone many changes since the 1970s. The cargo container was developed which reduced the amount of times the products needed loading on and off vehicles, and in and out of warehouses. More recently goods are loaded onto the container at the factory and products stay in the container until they are unloaded in at their final desination.

    Supply chain management is now a focal discipline which takes logistics to the next level. Distribution is a central strategic management topic, and involves logistics professionals with highly technical information technology, resources and software.

    The logistics manager integrates all elements of physical distribution and will optimise the flow of services and goods. There is a large amount of planning and organising in terms of the whole process, which includes selecting other agents and suppliers who are integrated into the process. Often logistics will integrate forwards with the supply chain of a large customer. An example of current thinking on logistics would include Just In Time Management (JIT) where components are delivered directly to manufacturing sites as the producers need them on the assembly line.

    Let us consider the nature of distribution by looking at a very simple example of how it works in relation to our everyday experiences.

    A basic example would be a tin of vegetable soup. The entire chain would begin with the seeds that the farmer sews and then plants. The farmer would sell the vegetables to the soup manufacturer, who would create soup from a recipe and then package the soup in a tin, and then bulk pack tins into a box and then those same boxes onto a pallet. The pallets would be driven by lorry or some other vehicle to a wholesaler. Independent retailers whilst visiting the wholesaler would break down a pallet and take a box of tinned soup. The retailer would return to his or her store and open the boxes of soup and place individual items onto a shelf next to similar products. The purchaser or customer would enter the store and buy a series of products including tinned soup. Having paid for the products the customer returned home and cooked soup for his or her family. The family eats the soup and they are the final consumers, as opposed to customers. This is an example of a very basic marketing channel in operation.


    The case is that a manufacturer will attempt to maximise the accessibility of his product to as many consumers as possible. A prime example of this is Coca-Cola and their attempt to put a bottle of Coke within the arms reach of every consumer. For Coca-Cola this means a number of channels of distribution including manufacturing, transportation, bottling, wholesaling, retailing, vending machines and any other form of distribution you can think of. Coca-Cola maximises its accessibility.

    Physical Evidence – Marketing Mix

    Physical Evidence

    Are you looking for physical marketing?

    Physical evidence as part of the marketing mix

    Services as we know are largely intangible when marketing. However customers tend to rely on physical cues to help them evaluate the product before they buy it. Therefore marketers develop what we call physical evidence to replace these physical cues in a service. The role of the marketer is to design and implement such tangible evidence. Physical evidence is the material part of a service.

    Physical Environment

    The physical environment is the space by which you are surrounded when you consume the service. So for a meal this is the restaurant and for a journey it is the aircraft that you travel inside. The physical environment is made up from its ambient conditions; spatial layout and functionality; and signs, symbols, and artefacts (Zeithaml 2000).

    Ambience

    The ambient conditions include temperature, colour, smell and sound, music and noise. The ambience is a package of these elements which consciously or subconsciously help you to experience the service. Ambience can be diverse. The ambience of a health spa is relaxing and calm, and the music and smells underpin this experience. The ambience of a nightclub will be loud noise and bright lights which enhance this customer experience, obviously in a different way. The marketer needs to match the ambience to the service that is being delivered.

    Spatial Layout

    The spatial layout and functionality are the way in which furniture is set up or machinery spaced out. Think about the spatial layout of your local cinema, or a church or temple that you have visited and how this affects your experience of the service. Functionality is more about how well suited the environment is to actually accomplish your needs. For example is the seat in the cinema comfortable, or can you reach your life jacket when on an aircraft?

    Corporate branding (signs, symbols and artefacts)

    Finally corporate image and identity are supported by signs, symbols and artefacts of the business itself. Examples of this would be the signage in Starbucks which reassures the consumer through branding. When you visit an airport there are signs which guide you around the facility smoothly, as well as statues and logos displayed throughout the complex. This is all important to the physical evidence as a fundamental element of the services marketing mix.

    There are many examples of physical evidence, including some of the following:

    • The building itself (such as prestigious offices or scenic headquarters). This includes the design of the building itself, signage around the building, and parking at the building, how the building is landscaped and the environment that surrounds the building. This is part of what is known as the servicescape.
    • The interior of any service environment is important. This includes the interior design of the facility, how well it is equipped, internal signage, how well the internal environment is laid out, and aspects such as temperature and air conditioning. This is also part of the servicescape.
    • Packaging.
    • Internet/web pages.
    • Paperwork (such as invoices, tickets and dispatch notes).
    • Brochures.
    • Furnishings.
    • Signage (such as those on aircraft and vehicles).
    • Uniforms and employee dress.
    • Business cards.
    • Mailboxes.
    • Many others . . .

    A sporting event is packed full of physical evidence. Your tickets have your team’s logos printed on them, and players are wearing uniforms (i.e. the team colors/colours and clothing). The stadium itself could be impressive and have an electrifying atmosphere. You travelled there and parked quickly nearby, and your seats are comfortable and close to restrooms and store. All you need now is for your team to win!

    Some organizations depend heavily upon physical evidence as a means of marketing communications, for example tourism attractions and resorts (e.g. Disney World), parcel and mail services (e.g. UPS Courier Services), and large banks and insurance companies (e.g. Lloyds of London). This is important to their corporate image. Of course there are other examples with a slightly more tangible offering such as Rolls-Royce motor cars and P&O cruises.

    Philosophy and Theory of Marketing

    The Philosophy and Theory of Marketing

    Marketing has many definitions, too many to considered here. Gibson et al (1993) found over 100 definitions and argued that no single definition of marketing should be aimed for since it might limit the future development of marketing as an academic discipline.

    What matters is the state of mind of the producer/seller – their philosophy of business. If this philosophy includes a concern for customers’ needs and wants, an appreciation of the benefits and satisfactions which are looked for, a genuine effort to establish dialogue and build a long term relationship then this is a marketing philosophy irrespective of whether or not the organisation possesses any personnel or function designated as ‘marketing.’

    Baker (2000 p19)

    The nature of marketing theory, or whether marketing theory is actually possible, has been the topic of debate for more than 40 years (Saren 2000 ). Initially a scientific approach, along the lines of the social sciences underpinned the aforementioned debate (Bartels 1951, Alderson and Cox 1948). This was based largely on empiricism, and tended to ignore the human nature of marketing as marketing managers crafted it. So conversely, the marketing management school viewed marketing from a manager’s perspective and took an opposing view that rejected the positivist notion and its empirical roots. Ramond (1962) contrasted the wisdom of the manager with scientific knowledge, since business acumen recognizes the low probability that given combinations of phenomena can or will be repeated. In other words, a scientific approach to marketing sought a generic structure, which it is argued is not possible since no two situations are ever the same. Any test of theory would not see a simple unambiguous question posed, with findings that are replicable since by their very nature markets are diverse and not all competitors have access to the same information, and even if they did managers are unlikely to create identical marketing plans. The scientific school cannot verify a generic approach to marketing.

    A relativist approach that saw no agreement or common ground between the opposing views was put forward by Anderson (1983). The relativist approach saw no meeting of the mind between scientists with different worldviews and persuasions (Kuhn 1962). According to Saren (2000), eventually Hunt moved to a realist position, that saw pure empiricism counterbalanced by an acceptance that perceptions may be illusions, and that some perceptions were more accurate than others. Hunt (1971) concluded that no single philosophy dominates marketing

    The academic discipline of marketing has core schools of thought, where marketing is seen as either a philosophy or as a function. Where marketing is considered a philosophy, the marketing concept is embedded in management thought. With the alternative view, where marketing is a function within a business, marketing is seen as a department, in the same way as accounting or personnel.

    The History of Marketing

    The history of marketing can be divided into three stages when considering the development of the marketing concept namely the emergence of the mass market ca 1850, the articulation of the modern marketing concept ca 1960, and the transition from the emphasis upon the transaction to the relationship ca 1990 (Baker 2000 p10-11).

    Marketing planning has its roots in the marketing management school of the 1950’s. Here, marketing managers followed a largely structured, formalised, positivist approach to marketing planning. However in summary the marketing management school was developed largely by American academics, and was based upon an analytical approach that tended to include analysis, objectives, strategies and control. It has no single dominating visionary, but is based upon contributions from Kotler (1967), McCarthy (1960), Borden (1964), and others. Marion (1993) is critical of the marketing management school and argues that there has been nothing new since the 1960’s or even well before. Other opinion leaders, considering marketing from a European perspective, echo his view. Gummesson (1993) strongly opposed the American perspective and reasoned that textbooks are based upon limited real world data and are prescribed approaches for consumer goods businesses. Most companies do not market consumer goods. Gronroos (1994) was critical of the view presented by largely American textbooks that marketing was founded in the 1960’s and was based largely upon the 4P’s/marketing mix. Kent (1986) regarded process considerations more important than the structure offered by the marketing management school. The usefulness of the 4P’s/marketing mix was criticised by some European academics (Gronroos 1989,1990,1994, and Dixon and Blois 1983).

    PESTEL

    PESTEL Model

    This lesson is about PESTEL analysis. As we know from our lesson on the marketing environment the wider macroenvironment impacts upon how marketing managers make decisions. During this lesson we’re going to look at how we audit and evaluate our external business environment. There are a number of acronyms which are popular for doing this including PEST (Political/Economic/Sociocultural/Technological), PESTEL (Political/Economic/Sociocultural/Technological/Environmental/Legal), SLEPT (Societal/Legal/Economic/Political/Technological), STEP (Society/Technological/Economic/Political) and others which include LE-PEST-C and SPECTACLES. They are all pretty much the same. Below are details of how to complete a PESTEL analysis, supported by some examples.

    Political

    The political environment revolves around the current government in a particular country in which we manufacture or trade, and also laws/legislation operate within your home market as well as overseas. If your government is socialist then perhaps there is a policy to tax more and to invest in the public sector. On the other hand if you have a more conservative or Republican government then the free-market is left to take control, taxation is less and there is often a smaller public sector.

    Economic

    The economic environment is a direct influence on all businesses. Obviously if you are studying marketing there is a huge element of economics within the topic itself, and you should be no stranger to the principles of economics. As we saw from our lesson on the marketing environment there is a macroenvironment, and internal environment and the microenvironment.

    More specifically you’ll be at looking elements such as where a business is in terms of the current business cycle, and whether or not you are trading in a recession.

    Sociocultural

    The sociocultural environment embodies everything which is social and cultural within a nation or society. There are plenty of examples of society and culture on the marketing teacher website, so we recommend that you go to our lesson store and look through some of the consumer behaviour pages. Some notable examples would include the influence of learning, memory, emotion and perception, motivation, lifestyle and attitude and consumer culture. Have a look at the six living generations in America, social environment and class, the impact of your birth order on how you behave as a consumer and take a look at the eight types of online shoppers.

    In a more general sense consider influences such as the increase in life expectation of Western consumers, and demographics which is the study of populations.

    Technological

    Technological factors are a multifaceted influencer. Let’s just think about the sorts of technology that you come in touch with almost daily. Smart phones such as Android and iPhone are now common – all – garden, and we are used to being able to access information and communication technology instantly no matter where we are. During studies or at work we have access to information on quick PCs and over the Internet, with faster broadband connections arriving in many parts of the world.

    Technology also surrounds business processes. As we saw from our lesson on the functions within an organisation all departments use information technology or technology in one form or another. Our manufacturing operations will use technology to produce goods and services. Our logistics and warehousing functions use forklifts and lorries as well as order tracking technology and software. The customer service department will use communication technology to talk to customers but will also have access to internal systems, such as technology to simplify credit control and stock control for example. There are many, many more examples of technology.

    Environmental

    Environmentalism and marketing connect where marketing may affect the environment when serving consumers with products and services. There is an environmental movement which puts pressure on businesses, governments and everyday people to be green. There are a number of examples of how companies can be greener internally and externally, from addressing manufacturing today, to designing a much more sustainable future. A manufacturer might reduce the amount of waste produced as a result of the manufacturing process or a restaurant might reduce the amount of packaging or food waste. An environmental approach is set in today’s tactics, but will eventually be embedded in the strategic vision of the business.

    Legal

    When marketing overseas your business will need to take into account laws in the local market. For example cars sold in mainland Europe and the United States tend to be left-hand drive, whilst cars which are marketed in Japan and the United Kingdom right-hand drive. This is a local requirement. Different countries have different laws in relation to maximum speed limits and safety ratings on vehicles, as well as many other bylaws and codes.

     

    PEST Analysis

    PEST Analysis

    What is PEST Analysis?

    It is very important that an organization considers its environment before beginning the marketing process. In fact, environmental analysis should be continuous and feed all aspects of planning.

    Political Factors.

    The political environment revolves around the current government in a particular country in which we manufacture or trade, and also laws/legislation operate within your home market as well as overseas. If your government is socialist then perhaps there is a policy to tax more and to invest in the public sector. On the other hand if you have a more conservative or Republican government then the free-market is left to take control, taxation is less and there is often a smaller public sector.

    The political arena has a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. You must consider issues such as:

    1.How stable is the political environment?

    2.Will government policy influence laws that regulate or tax your business?

    3.What is the government’s position on marketing ethics?

    4. What is the government’s policy on the economy?

    5. Does the government have a view on culture and religion?

    6. Is the government involved in trading agreements such as EU, NAFTA, ASEAN, or others?

    Economic Factors.

    The economic environment is a direct influence on all businesses. Obviously if you are studying marketing there is a huge element of economics within the topic itself, and you should be no stranger to the principles of economics. As we saw from our lesson on the marketing environment there is a macroenvironment, and internal environment and the microenvironment.

    More specifically you’ll be at looking elements such as where a business is in terms of the current business cycle, and whether or not you are trading in a recession.

    Marketers need to consider the state of a trading economy in the short and long-terms. This is especially true when planning for international marketing. You need to look at:

    1. Interest rates.

    2. The level of inflation Employment level per capita.

    3. Long-term prospects for the economy Gross Domestic Product (GDP) per c