Company/Product Overview
Sonance is a well-established company providing high quality customized speakers for in-home entertainment. After launching their Sonance 1 model, they progressed into multi-room amplification and eventually designed the first built-in system that would support the iPod. Operating as a lean organization with only 60 employees, they relied heavily on a network of dealer and installer word-of-mouth advertising. By 1999 Sonance had reached $46 million in sales. Similar to other companies affected by innovations in technology, Sonance was forced to change strategic direction in the early 2000’s. The newly acquired leadership needed to redefine marketing efforts in response to increasing low cost competitors. Major
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Internally the strategy moving forward was unclear. The chance to address 25,000 dealers demanded the new leadership had a clear picture of their mission moving forward. With a very narrow scope of product offerings and the slowing sales of their high-end speakers, the decision to expand into additional products, or stay focused on their main revenue source would determine the future of the company. Offering their product in the large retailer market and pulling away from the independent installers had already damaged their brand equity. Furthermore, engaging with the production home builders, while generating the necessary revenues for survival, alienated the custom installer and their referral clients. (Kerin & Peterson, 2013). Considering the relatively small size of the company combined with the dangers associated with brand extension could overstress the resources necessary to launch and maintain a new line. One of the keys to a successful concentric diversification is close coordination with existing customers and distributors. Unfortunately, the dealers that had made them successful were not pleased with their recent brand dilution. (Gordon, …show more content…
Regarding strategic control, they were faced with determining how to move forward, and with what mix of product offerings? The leadership realized that with shrinking profits and increased competition the status quo would not guarantee long-term survival. Execution via their previously successful marketing channels would be problematic without either some sort of peace offering to dealers and installers, or a total shift in the advertising and sales process. The dealers and installers interacting with the customer were more likely to understand the customers concerns. Unless the company rebuilds their relationship with these front-line sales force, the customer service will suffer and ultimately the brand equity will continue to erode. The idea that the dealer is treated as the most valuable link to the customer and feels completely supported by the supplier, is exactly what enabled Caterpillar to survive in the late 1990’s. (Fites, 1996). Regardless of how the company addresses their root problems, a marketing channel analysis will undoubtedly conclude that both order getting and order servicing expenses will initially increase. In the short-term, the relationships must be rebuilt. In the long-term, they must shift overall strategy to remain profitable. If they elect to maintain their high-end product mix, customer expectations will increase demanding more from
In the early 2000’s Lowe’s was rapidly intensifying its presence nationwide. The company carried a varied assortment of home improvement products and catered to the needs of retail as well as commercial business customers. Lowe’s expanded their reach by acquiring a 41-store chain, Eagle Hardware and Garden, and engaging in a strategic alliance with HGTV to obtain a more profound existence in their market (Rouse, 2005). By 2004, Lowe’s operated almost 1,000 stores with plans to continue expansion across the nation (Rouse, 2005). The company has a core competency in helping customers meet their home improvement needs at a low price. In order to use this core competency to gain a competitive advantage, the company has focused on key functional strategies. To continue their success, Lowe’s must specifically focus on marketing, logistics, and human resource management strategies.
Lucio Proni is an engineer and cofounded of the company with his high school buddy Jim Birch. During the mid-1970’s when they were on their summer break from the University of Florida, Lucio and Jim decided to mess around with component speakers and wound up building home loudspeakers for fun. They worked out of a garage in Lucios home and showed some of their speakers to their friends and some. Later on, a few of them even bought some, so they built a couple more to sell on the flea market. Lucio’s early success inspired him to start a speaker business so he could make a living from his work. In 1975, he joined fellow business partner and friend, Jim Birch and founded JL Audio; their company name being an amalgamation of the first letters of their names. They didn’t really start out their business with a solid business plan, their early days were instead marked by a lot of trial and error. At first they tried to sell JL Audio products to local audio shops. They found some success doing this since a couple of the loca shops were interested in selling their home speaker systems and kits. In 1977, business became scarce and they encountered financial difficulties as a result. In troubling times like this, it was Jims’s business skills, Lucio’s quality workmanship, and their combined tenacity that got them through it all. As a child, Lucio was given some valuable advice from his father; he said that “if you’re not willing to put your heart into something, then don’t bother doing it”. This work philos...
In the 1990’s, Harley Davidson saw tremendous growth and looked for resolutions to its one problem of balancing production with its soaring demand. In 1996, Harley announced “Plan 2003”. “Plan 2003” was a huge undertaking to increase its production capacity, introduce several new models and increase international expansion. At the end of this planned expansionary period, Harley’s sales had grown tenfold over just 23 years. However in 2007, domestic demand was starting to slip, as several economical factors...
The Home Depot organization has generated quick growth throughout its operating years. From the first store openings in 1979, the firm has created an exceptional growth pattern, opening their 100th store in 1989 and continuing on into the global market. The company feels that their unique culture and values are what gives them their competitive advantage in the marketplace. Their strengths are in the strong position they have with professional
The desired outcomes from reorientation of the company’s business were to reduce risk of increasing prices, decrease costs and increase sales. These desired outcomes have ap...
...strategy when the initial downsizing failed to take them out of the red or gain back lost market share.
Home Depot is the brainchild of Bernard Marcus and Arthur Blank and came about after both men lost their job in the home improvement industry in 1978 (Parnell, 2014). Home Depot has acquired several smaller home improvement stores in both the U.S. and abroad through the years which enabled it to position itself as the world’s largest home improvement chain (Parnell, 2014). Home Depot focuses on the do-it-yourself segment of the market and sells sells tools, construction products and services. Marketing is a strong point for the company. They are able to maintain a competitive advantage by keeping themselves available to their customers at all times. Home Depot has been using both online and offline marketing efforts. The internet has become a very useful tool for the company and part of the reason that they are leading the market in DIY stores. Home Depot currently provides DIY videos on YouTube and Vine that cover current topics that consumers are likely to be interested in. They also have social media pages on Facebook and Twitter, where they have a huge following. They provide online communities where actual employees answer consumer’s questions and provide assistance on
Conclusion: Given the current economic status the home improvement industry is in a low spot with sales. With the decrease in building new homes we have to focus mainly on home improvements. The three strong points we have against existing rivalries are our great locations, quantity of quality products, and convenient customer service. With these great qualities we can move ahead and stay ahead of our competitors during these times.
In the 1960s through the 1970s, companies realized strong engineering, design, and manufacturing functions were strong market strategy keys to create and capture customer loyalty. As the demand for new products rose in the 1980s, these market requirements were to increase their flexibility and responsiveness to adapt existing products and processes or to develop new ones in order to meet customer needs. As manufacturing improved in the 1990s, managers began noticing material and service inputs involving suppliers and their major impact on an organization’s ability to meet customer needs. As a result of these changes, organizations now find that it difficult to manage their own organizations. First, they must be involved in the management of their network of all upstream firms that provide directly or indirectly, as well as the network of downstream firms, which are responsible for delivery and market service of the product to the end customer.
Over the past few years, the increasing dynamism and competition in the business operating environment has led to a lot of changes in how the companies conduct themselves with respect to its customers. Customers being the focal point of revenue; manufacturers are increasingly taking interest in being focused on customer satisfaction by delivering the products and services on time.
The key issues for K-Mart strategies are finding the right cost level for an opportunity to be aggressive, and differentiating the product for consumer in terms of different consumer and different intangible product attributes. K-Mart and Sears should be combined with a new overall corporate competitive strategy using a cost focus. This may turn out to be the only sensible strategy, and the one which best describes the strategy adopted. Strategies of cost leadership and product differentiation are often described as if they were mutually exclusive you can either pursue one or the other, but not both.
The three alternative strategies are: cooperative strategy: strategy alliance (focus on joint venture), international strategy: transnational strategy, and differentiation strategy: integration cost leadership and differentiation strategy. After we have finished on doing those three alternative strategies’ evaluation and selection, we agreed on using the differentiation strategy: integrated cost leadership and differentiation strategy (hybrid strategy) as the strategic alternative for Harley Davidson. In the next couple paragraphs we are going to discuss in detail how to implement the integrated cost leadership and differentiation strategy and action planning for Harley Davidson. The integrated cost leadership strategy and differentiation strategy is the business level strategy that most of managerial people consider as the hybrid strategy (www.ccsenet.org). The hybrid strategy has become the most important and successful strategy that attracted many organizations to choose and implement this particular strategy. As global competition keeps on increases, it is crucial for each organization starts to think about building its own economic of scale, lower production costs while developing on its innovative products or services for
Quickly becoming apparent after only a few rounds of play was in the absence of coordinating direction the individual supply chain links immediately focused upon acting in their own best interests much more so than the organization as a whole. Whether the end use customer was satisfied became secondary to avoiding stock outages for the next link in the chain, or their specific “upstream customer”. The real world application of this example is that focus on the end use customer must be consistent and maintained throughout the process up to and including delivery. Undoubtedly internal customers, such as retailers to wholesalers and distributors to production, must be serviced along the way for the transaction to ultimately occur. However, unless an end use customer is involved no profit can be realized by anyone.
Difficult to regain trust of existing loyal customers who expected high quality and performance when in competition with other firms in upper trade market.
The XYZ Corporation was established in 2004 and their main office is located in Vancouver, BC. The company’s main objective is to create new innovating technology for media devices, computers, and digital music players. They deal with the design, manufacturing and marketing of the products. XYZ Corporation has been providing Canadians with groundbreaking technology throughout the years and continues to create new technology to provide others with top-level technology. Although, recently their success rate has appeared to drop rapidly due to a number of factors that will be explored throughout this case study. Their main objective is to target the problems so that they can work towards having the issues resolved as quickly as possible. If they do not take any course of action, the state of the company may be in extreme danger. This case study is designed to explore the areas of the company and discover the problems blocking the XYZ Corporation from success.