The importance of ethics for businesses has been a topic of debate for long. At the turn of the 21st century the Enron scandal added fresh heat to the debate. Enron went bankrupt and left behind a lesson for other businesses. Moving away from ethics can cost businesses everything from your business image to your profits. Enron became a case study cited in the business and academic circles whenever there was a mention of corruption and lack of ethics in the corporate world. The focus of governments and businesses both has increased on ethical practices.
While the introduction of SOX was mainly meant to regulate the financial businesses, other companies too have focused on ethics in the following years. Prima facie, it appears that businesses are now more concerned about their image and maintaining their ethical standards. However, the real answer lies deeper. It is not just your image but your business performance and profitability also depend on ethics. Businesses are not doing it out of pressure but there is also a motivation behind it. Several of the big brands have shown that being concerned for your ethics can improve your brand’s image and sales. The root of ethical practices lies in the organizational culture. If you want to adopt ethical practices in your business then you must first focus on the creation of an organizational culture that is rooted in ethics. Starbucks is a well-known name in the world of business. However, it is not just its premium coffee and the style of customer service that has made it famous. More than that, it is known as an ethical company that maintains ethical practices internally as well as externally down its supply chain. Ethics and compliance are made a part of the organizational strategy and the employees are trained at Starbucks to behave ethically and remain compliant. The brand has created awareness material for the purpose of training its employees. As a part of its awareness program, it regularly investigates and resolves any type of ethical issue arising inside the organization. It has set standards of business conduct that guide everyday behavior inside the organization’s offices and stores. Regarding legal compliance also Starbucks is very clear in its rules and strategy. All the relevant laws are to be adhered to and it is set out clearly in its standard of business conduct. However, it is the inside story. Down its supply chain also Starbucks has ensured that it sources all of its cocoa ethically. It has already achieved the 99% milestone in the ethical sourcing of raw materials. Apart from ethics, CSR is another major concern for businesses and particularly the big brands. Starbucks is also focused on community involvement and investing in projects that help the community and the resourceless. Several of the big companies including Pepsi are investing in the environment and community. It does not have a huge environmental impact like the several other brands and still if Pepsi is focused on environmental leadership and water stewardship then it is because the brand is focused on environmental protection. Investing in CSR has its own benefits for the brands. It is not just for generating publicity. Research has found that it leads to better brand image and an increase in customer loyalty. Pepsi spells out these key focus areas in its mission and vision statements too. It calls it performance with purpose. “ At PepsiCo, we aim to deliver top-tier financial performance over the long term by integrating sustainability into our business strategy, leaving a positive imprint on society and the environment. We call this Performance with Purpose”. Brands need to care for the world they live in. Business is not just about making profits. It is because both the community and environment are key stakeholders and unless you can handle their concerns too and invest in CSR, you cannot expect a great brand image and loyalty from your customers. Even the customers are watching which brands are investing in the environment. It leads to a positive outlook on the brand. So, the brands must not lose the focus of either in the 21st century — ethics and CSR. Apart from that, customer orientation is important. Read more @ notesmatic.com
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Core competencie s Valuable Rare Inimitable Organized Advantage Brand Image Yes Yes Yes Yes Competitive Advantage Marketing Yes Yes Yes Yes Competitive Advantage Customer experience Yes Yes Yes Yes Competitive Advantage Product Innovation Yes Yes Yes Yes Competitive Advantage Product range Yes No No Yes Temporary advantage Product quality Yes Yes Yes Yes Competitive advantage Technology Yes Yes Yes Yes Competitive advantage Brand image: Any firm’s brand image is a significant source of advantage for it. Let’s take for example Walmart, which is known for its lower prices and has a customer friendly image. Its brand image is a key driver of sustainable competitive advantage for the firm. In the case of Nike too, the firm’s image drives higher popularity and loyalty worldwide. Nike has also maintained the image of a customer friendly, innovative, and quality focused brand. Its image is a significant driver of competitive advantage for the brand. The company’s image is superior compared to its rivals and has been strengthened by the company’s continued focus on quality, innovation and customer experience. The stronger a brand’s image in the market, the more customers feel drawn towards it. Nike’s marketing strategy has also played a key role in strengthening its image worldwide. Its brand image is a source of sustainable competitive advantage for the firm. Marketing: Marketing has helped several firms beat the competitive pressure and gain a significant edge over their rivals. Successful marketing strategies have helped firms differentiate their brand from the rivals and grown their market dominance. Nike is one of the most well known marketers https://notesmatic.com/ globally. Its marketing strategy has a central focus on encouraging athletes to achieve the impossible. Its swoosh logo and the Just Do It slogan have made it a leading name in the worldof marketing. However, apart from advertising, promotions, and sponsorships, there are other elements in its marketing strategy too including a strong focus on product quality and athlete friendly innovation. Nike’s market dominance however, is not a result of excellent quality or great products only but marketing has played a significant role in helping it win the global market. Overall, it is one of its leading core competencies that have helped it build a sustainable source of competitive advantage and a unique market position. Customer experience:- Read a detailed analysis @ notesmatic.com https://notesmatic.com/vrio-analysis-of-nike/ Undoubtedly, both are great and highly innovative, but Apple and SONY still do not form an apt comparison. Apple is many times larger than SONY is in every sense. It is also a lot ahead of SONY in terms of innovation apart from market size. Apple’s product portfolio is much limited compared to SONY, but Apple’s brand loyalty and marketing strategy beat SONY.
SONY has been forced out of the smartphone market in markets where Apple still rules. Moreover, when it comes to customer-oriented innovation, Apple is ahead of every other brand in the industry. SONY builds innovative products (not knowing if customers will love it), but Apple makes innovations that customers love. Yes, it has brought industry winning products like PlayStation. That's true, but then why is it losing in the smartphone market and why is the demand for SONY televisions and video cameras falling. So, while SONY is a famous brand, Apple is a brand second to none. Apple’s brand image and SONY’s are also very different. Apple is much more agile and has the edge SONY lacks. In several areas, SONY failed to read the customers’ pulse, but Apple did not. It is why there is a huge difference between the market caps of the two. Apple is worth around $2.3 trillion, whereas SONY had a market cap of only $125 billion in the fourth quarter of fiscal 2020. Thanks! Definitely, Domino’s Pizza became a major success in India, unlike most other nations where it tried to establish its business. In India, Domino’s Pizza was introduced by Jubilant food works. However, apart from marketing and quality, there are some cultural reasons too that led to its success in India. Some of it was because of the demographic changes as well as the Indian market opening itself to foreign businesses. However, the most important thing is how it gained importance and grew in India. Its market penetration strategy was based on the promise of 30 minutes or free which worked quite well in India because customers here love freebies. This model did not work so well in other markets but helped Domino’s find growth very fast in India. So, the real difference is about the population, cultural factors, and consumer demographics. A large customer base for Domino’s products existed in India. Moreover, the concept of home delivery was new to the Indian market. It was something that really began with Domino’s pizza. Now, that Domino’s has matured in the Indian market, India continues to remain its strong-hold. So, actually it was the cultural fit that helped Domino’s build a business model from scratch and sustain it in India. The middle-class population is also very large in India and offers Domino’s pizza a very large customer base. Cheaper labor and raw material availability have also helped it sustain its success in India apart from technology. Economically speaking, India is a fast developing nation which also makes it highly suitable for Domino’s business.
There are several pros associated with email marketing. Some of them are listed below:
Cost-effective: You do not need to make a huge investment. Flexible: You have several design choices and can include images, graphics everything. Not time consuming: Sending emails does not take a lot of time. Not so intrusive: Unless you are planning to flood your readers’ accounts with emails, it is not intrusive compared to phone marketing or digital advertising. Scalable: You can send to thousands of people or just a few depending upon your needs. Real-time: You can promote offers in real-time through email. Automated: Ecommerce brands use automated emails for serving their customers. Email marketing is considered an effective digital marketing tool. However, there are certain drawbacks you need to keep in mind before you do email marketing. Otherwise, it is a highly cost-effective and flexible marketing tool that is a favorite of marketers and e-commerce brands around the world. The leading drawbacks associated with email marketing are: Standing out is difficult: Users receive a flood of emails every day. To stand out such that the reader pays attention is difficult. Ordinary emails are trashed by users without being given any attention. Requires design skills and experience: You need to create a nice and attractive email marketing campaign in order to be effective or the ROI on your email marketing campaign will below. This requires some design skills and attention to the smallest details or your mail will look ordinary and will not have any impact. Spam: Most of the marketing emails land in spam which is because of email accounts often getting flooded with such messages leading yo users enabling spam settings for such emails. Frustration due to misuse: Email marketing is also misused for fraud and some times marketers start sending emails without user consent or without caring for the readers’ privacy. This has led to a decline in the credibility of e-mail marketing. So, if you are planning to do email marketing, you must do it with caution and keep in mind that attractive design builds credibility and helps you get noticed. More on email marketing. The largest physical retail brand in the US, Walmart has a global store network of more than 11,300 stores of which 5,355 stores are located in the US alone (2019). The brand is present in 27 countries serving its customers under 58 banners. The main factors driving the popularity of Walmart are the lower prices and the large range of products it sells. In 2019, Walmart acquired the e-commerce brand Flipkart to strengthen its presence in the Indian market. The net e-commerce revenue of the company during the fiscal year 2019 reached $25.1 billion. However, the leading source of Walmart’s competitive advantage in the global markets is its pricing strategy. The mission of Walmart is to “save people money, so they can live better” and its pricing strategy is aimed to maximize savings for its customers.
EDLP Strategy.Behind the enormous growth of Walmart and its success is its pricing strategy. The EDLP strategy means Everyday Low Prices. The company has been using this pricing strategy right since its inception and never deviated from the strategy. However, the EDLP strategy does not suit all the retail brands and this pricing strategy is used mainly in association with Walmart in the US. It is because you need certain other strengths too to sustain lower prices which have remained a key revenue driver for Walmart. (Walmart’s revenue crossed $514 billion in 2019 of which $510.3 billion were from sales of products whereas the rest from membership and other fees.) The first and most significant benefit of the EDLP strategy is higher demand. If your prices are lower than the competitors, customers will automatically flock to your stores leading to competitive advantage. Lower prices grow the demand for your products and if you offer quality products for low prices, the demand will continue to grow. Apart from that, if customers can find good quality products at your store at lower prices than other brands, they will stay loyal to your brand which means repeat purchases and higher profitability. One key drawback of EDLP is that you may have to sacrifice profit margins. Margins may be thinner at Walmart but the overall sales volume is just so high that it more than makes up for the lost margin. However, it also requires Walmart to control costs across its business operations. How does Walmart Control Costs?Controlling prices requires cutting down operational costs and other expenses. The EDLC or Everyday Low Costs formula has helped Walmart control costs and pass on the benefits to the customers. Use of Bargaining Power: A large number of suppliers depend on Walmart for a significant part of their revenue. Walmart has a significant influence on the bottom lines of these companies. Using this influence, Walmart is able to press its suppliers to cut down costs. Many times suppliers, automate their processes or move production to countries like China where cheaper labor is available in order to bring costs down and maintain their relationship with Walmart. Lower Operational Costs: To keep prices for its customers low and generate a significant competitive advantage, Walmart has kept cutting down operational costs. However, that does not imply the company has sacrificed operational efficiency. Cutting down unwanted layers of operations and eliminating any wasteful processes has helped Walmart bring operating expenses under control. This has remained Walmart’s rule right since its foundation. The company keeps its overheads low. Apart from that Walmart has also focused on supply chain and logistics management in a manner that eliminates costs and wastage of time. A technologically advanced supply chain system, an efficient inventory management system and a well-managed distribution network that focuses on saving both time and money have also helped Walmart cut down inventory management costs. Direct Sourcing: Instead of buying from middlemen, Walmart sources products directly from the manufacturers. This has also helped Walmart eliminate unnecessary costs and since it buys in bulk, it can press them to cut down costs. High Sales Volume: Keeping prices low also means thinner profit margins. So, what makes up for the lost margin? The sheer high sales volume at Walmart helps overcome all the other weaknesses. The sales volume is just so high that even at lower margins, the company’s profit level is significantly high. The same would not be possible if Walmart chased higher profit margins. Vodafone Marketing strategy
Introduction: Vodafone is a leading telecommunications player with operations in Europe and Asia Pacific mainly. Based upon the number of mobile customers, India is its largest market with more than 223 million customers of Vodafone’s mobile services. Headquartered in UK, Voda has operations in 25 countries. However, in several more markets, it has formed partnerships with local operators. It also provides 4G roaming coverage in 144 markets. Moreover, the brand has focused on growing its range of services for both individuals and enterprise customers since the data related needs of consumers have grown fast. Vodafone is working on strengthening its core advantages. It invested more than €81Bn in past five years to make its business model stronger. Growing competition in the telecom industry internationally and fight for market share has forced brands to grow their focus upon marketing and user engagement. While Vodafone has created strong brand recognition internationally, the need for superior user engagement has grown in order to to reduce customer churn rate. The company has reinvented its marketing strategy recently and following are its major pillars. Superior Customer Experience and Customer Engagement Customer experience has become key to great marketing in the twenty first century. All major technology brands and in other industries too, companies are investing more in understanding and providing superior customer experience. To make it a core pillar of its marketing strategy, Vodafone started a new programme called CXX or Customer experience excellence. The focus of this programme is to offer a differentiated customer experience which will further strengthen the leadership position Vodafone has built. Moreover, to make this program a success, Vodafone has linked the related KPIs with employee bonuses. CXX will focus upon customer convenience as well as service quality. There are around 417.1 million customers of Vodafone’s mobile services in Europe and around 118.7 million customers in AMAP(Africa, Middle East and Asia Pacific). Focusing upon user convenience will help it reduce the churn rate and increase loyalty. Higher Focus on Digitization Digital technology will play a core role in the marketing strategy of Vodafone and not just in terms of marketing and promotions but also in terms of access and delivery of services. The Digital Vodafone programme is an extension of the CXX programme whose aim is to deliver the most engaging digital experience for Vodafone users blending its digital and physical assets to offer personal, instant and easy interactions. Voda intends to grow its use of data analytics for designing more personalized experiences for individual users. In future, its My Vodafone app and digital marketing channels will also become the main customer acquisition and management platforms. Voda will invest in cloud and other technologies to digitize its operations. By providing more personalized experiences through its digital marketing and service channels, the company aims to achieve higher user engagement and reduce the churn rate. Driving Loyalty Through Rewards Rewards are a great tool for promotions as well as driving customer loyalty. Vodafone intends to grow the use of loyalty programs and rewards to achieve higher loyalty and grow its market share. It has already implemented the loyalty and reward programmes in 18 key markets. These rewards are accessible through Vodafone’s app and website in 14 markets. Moreover, to make redemption a fun experience, it introduced ‘Shake’. All customers have to do is to shake their phone to redeem the reward points. Simultaneously, the company is working on introducing more relevant and real time rewards for Vodafone users. Consistent Branding and Advertising Vodafone is also recognized as a great marketer which has successfully engaged its users through its promotional activities. Its focus has remained on creating the image of a customer friendly brand. Whether it is the zoozoo ads or other advertisements, the engagement level of its promotional activities has remained high. The zoozoo ads were specifically very popular and became a social media sensation. In sports season too, Vodafone uses these zoozoo ads to drive user engagement and brand recall. The zoozoos are funny characters with egg like bellies. While they entertain well, they also engage like nothing else. Vodafone is creating a customer centric image and that will require it to focus upon all aspects of marketing including promotions, user engagement and most importantly customer experience. More: Vodafone Business Profile Tencent is a Chinese internet technology firm. It has its headquarters in shenzhen. The company has released several internet based products and services. The company mainly targets the Chinese users. Its social media networks and messaging apps have a very large base of active users. It is why the company has acquired global fame within a limited period of time. Tencent earns its revenue from its VAS business and online advertising. In 2018,its revenue was RMB 312,694 million. Following are the leading products and services by Tencent:
Social media & messaging products: QQ is an instant messaging platform for Personal computer and mobile. the platform became an instant favourite of Chinese youth due to its excellent features. Apart from text messaging, users can share videos images and stickers. In 2018, the number of QQ Monthly active users was around 807 million. It also offers a related payment service called QQ wallet. Weixin/WeChat - Weixin/Wechat was launched in 2011 and since then it has continued to engage users with its several innovative features. It offers an integration of instant messaging and social entertainment. Apart from real time interactions the users can also make video calls and share photos. By the end of 2018, the number of Weixin/Wechat Monthly Active users had climbed to around 1098 million. Qzone Qzone was created in 2005 and is the largest social networking platform in China. Apart from uploading photos and sharing videos, users can also play games on Qzone. The number of monthly Active users of Qzone in 2017 was around 563 million. Other products: Tenpay:- Tenpay by Tencent is the second largest online payment platform in China. QQ Wallet:- QQ wallet is a mobile payment product by Tencent that integrates several payment options like bank card payment, QR code payment and NFC payment. Tencent Games:- Tencent games is the largest gaming platform of China which offers a large collection of variety of games. The company is working on making the platform as much engaging and fun for its users as possible. Apart from these main products, the company also offers several more products and services including Tencent music, Tencent classroom and a large number of other utilities and AI platforms.
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AuthorAbhijeet Pratap Archives
October 2021
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