Marketing Management
Q.1 Case study
American Tourister
re-positioning itself as a hip travel brand leveraging Sports Partnership
American Tourister,
Samsonite’s mass market label, is re-positioning itself as a hip international travel
brand; targeting the cool, young traveller.
In December 2016, as part of
their India campaign, Virat Kohli was brought onboard as a brand ambassador.
Kohli is – for India - the ideal face for the brand as he is the
personification of American Tourister’s re-positioning.
Following the success in
India, American Tourister took things to the next level and in February 2018
appointed football star Cristiano Ronaldo, the most followed male on social
media, as their brand ambassador.
Anushree Tainwala, Executive Director,
Marketing at Samsonite, said, “There couldn’t be a better time to bring
Cristiano on-board. His lively and vivacious personality, on and off the field,
resonates perfectly with our
funloving, vibrant brand
personality. His presence will help bring American Tourister to a whole new
audience, allowing us to stand out from the competition, and
enabling us to take the Brand to the next level.”
In Kohli and Ronaldo, it has
found two iconic sports personalities who have strong personal brands &
massive following in emerging markets. This helps American Tourister win
asymmetrically and leave competition in the dust. In addition to transferring
the sports stars' attributes to the brand, the partnerships:
Elevate the brand from Samsonite's low end product
to a contemporary, practical international travel brand; targeting the
aspiring, young international traveller. Explode the reach: Getting the reach
in India via Kohli (81m social media followers) and globally through Ronaldo
(315m followers) -especially with the FIFA World Cup around the corner.
Engage audiences: Kohli with
“I’m ready” & "Swagbag", Ronaldo with “Bring back more” are
examples of sharply positioning the brand leveraging the ambassadors to provide
differentiated, exciting engagement.
Top of Mind: Standing out in a
commoditised travel accessary category, American Tourister is positioning
itself as closer to the hearts of young travellers and in their purchase
consideration. In February & March this
year it has activated both
players - Ronaldo (here) & Kohli (here & here), Let's see where the
brand takes such partnerships as we get closer to the Russia World Cup. It has
achieved a strong cut-through even before the world gets gripped by the World
Cup fever.
Question:
(10 × 2 = 20)
1. How can your brand
differentiate & asymmetrically win in a commoditised category through
sports?
2. What other, more effective ways can brands use
to reposition themselves?
Assignment
Subject: Marketing Management
Q.2 Case study
In August 2004, a leading
business newspaper reported that Hyundai Motors India Limited (HMIL), an Indian
subsidiary of the South Koreabased Hyundai Motors Company (HMC)3 was expected
to reduce the price of its flagship car - Santro - by as much as Rs 40,000.
Industry experts were expecting a reduction in Santro's price in response to
the price war being waged by the market leader in India - Maruti Udyog Limited
(MUL),4 which had reduced the price of its largest selling car in the B segment
– Alto - by Rs 58,000 in two price cuts starting from September 2003. This move
had resulted in Alto replacing Santro as the largest selling car in the B
segment in the period January to June 2004 (Refer Exhibit I for the market
segmentation of the Indian car industry).
Marketing Management Case Studies | Case Study in
Management,
Operations, Strategies,
Marketing Management, Case Studies Rebutting the report on price cuts, HMIL's
managing director, BVR Subbu (Subbu) said, "We are not cutting prices on
the Santro. We have allowed our competitors the prerogative of cutting
prices."5 Several dealers of HMIL also felt that the company would not
reduce Santro's price as it had not adopted such tactics earlier.
Santro had been the most successful product of HMIL
and was also the largest selling car in the B segment till the fiscal year
2003-04. Introduced in late 1998, Santro had emerged as the second largest
selling car in India after MUL's M800 and had retained its position till March
2004
(Refer Exhibit II for the
total units and value sales of the top eleven car models in India).
In mid 2004, HMIL with its
four models, Santro, Accent, Sonata and Elantra, was the second largest car
company in India with 19% market share in the industry. The company was
planning to launch another model, 'Getz', in September 2004.
Analysts attributed HMIL's
success to its ability to launch technologically superior products and its
innovative marketing strategies. However, they expressed concerns that the
company relied heavily on Santro and any fall in demand for that model would
hit the company.
It was felt that the introduction of new cars by
the competitors and pgrading & price reduction of existing cars in the B
segment would affect Santro's sales. This would lead to a loss in Santro's
market share. (Refer Exhibit III for the comparison of features of various
models in the B segment).
For a long time after India became independent in
1947, the car market had just two models to offer - the sturdy 'Ambassador'
from Hindustan Motors (HM) and the sleek 'Fiat' from Premier Automobiles (PA).
This was the result of Government of India's (GOI) decision to keep the car
industry tightly protected.
For HM and PA, the GOI
dictated as to what type of vehicle the two companies should manufacture. No
other domestic or foreign car manufacturer was allowed to enter the Indian car
industry. The restriction on foreign collaboration led to poor technological
improvements in Indian cars. As a result, car prices remained high while
quality was inferior. This affected the growth of the industry. The demand for
cars in 1960 was 15,714 units and in the next two decades, this rose to 30,989
units, which meant that the Compound Annual Growth Rate (AGR) was just 3.5 per
cent.
In the 1980s, the GOI felt the
need to introduce an affordable small car, targeting the Indian middle class.
As manufacturing a small and affordable car required better technology than was
available indigenously, the government tied up with the noted Japanese company,
Suzuki. The government formed a joint venture with Suzuki and founded Maruti
Udyog Limited (MUL). It held 74% and Suzuki got 26% equity stake in MUL. In
1983, MUL launched the 'Maruti 800', priced at Rs 40,000 Hyundai's Entry in
India
One of the major players that
entered the Indian car market was HMC through its subsidiary HMIL. Before
making its move, the company closely studied the industry for a year. The
company's officials talked to vendors, dealers and customers to get a thorough
knowledge of the industry...
Marketing Santro: Santro
received an encouraging feedback from customers who appreciated its unique
design that gave more headroom and facilitated easy entry and exit... Launch of
Accent: By mid 1999, the major players realized that the 'B' segment would be
the fastest growing in the car industry. To cash in, Telco re-launched its
'Indica' by introducing several new features and solving the glitches in the
original model...
Marketing Management Case Studies | Case Study in
Management,
Operations, Strategies,
Marketing Management, Case Studies Repositioning Santro By late 2002, the
competition in the B segment had increased
significantly. MUL's Alto which was launched in
October 2000 had received a good response. Although HMIL's Santro remained the
largest selling car in the B segment, MUL commanded the largest market share in
this segment due to the combined sale of its three cars - Zen, Wagon R and
Alto... Status in 2004: The financial year 2003-04 ended on a positive note for
HMIL. The company achieved revenues of Rs 50 bn and profit after tax (PAT) of
Rs. 1.90 bn in the financial year 2003-04 compared to Rs 43 bn revenues and PAT
of Rs 1.65 bn in the fiscal 2002-03...
Question:
(10 × 2 = 20)
1. Examine and analyze the
marketing mix of Hyundai Motors in the Indian passenger car industry.
2. Compare and contrast the
marketing strategy of Hyundai with other leading players in the Indian
passenger car industry.?
Assignment
Subject: Marketing Management
Q.3 Case study
The British Company, Woolworths is normally
categorized as a variety store dealing in retailing of a range of varying
products. Historically it was established as a subsidiary of an American
Company F.W. Woolworth &Co, in 1879 by Frank Winfield Woolworth It was
incorporated in England on 23rd July, 1909 as private limited company with
initial capital of 50,250 pound sterling. It, first time floated a new idea of
selling all the products at a cost not more than five cents. This idea gained
popularity amongst the customers resulting in fast growth of the subsidiary.
Its first shop at Liverpool attracted about 60,000 people in first two days
because of attractive one penny, three penny and six penny products put at
sale. It continued to open new shops at various cities that attracted heavy
rush of customers and visitors. It was company’s policy to purchase the
products directly from manufacturers, who also were very happy due to momentum
in their business as well. Some of the manufacturers started doing business
solely with the Woolworths and labeled their products with the company’s name.
Company’s business grew day by day and it had 31 shops in United Kingdoms by
the year, 1914. Due to inflationary trends after the World War II, the company
had to do away with its three pence and six pence price limits. It introduced
self service first time in its retail side in the year 1955. Woolworth opened
about 190 self-service stores by the year 1970. It created new division in the
stores by establishing Woolco departmental stores in the year 1966. These
stores had full range of quality products like, clothes, groceries, car service
and restaurants etc. available at affordable prices.
The Company continued to flourish very fast because
of its stated aim to remain at the customer’s heart and best kid’s retailer
till 1966. But thereafter its sales as well as profits started falling because
of its competitors, Marks & Spencer who overtook its sales as well as
profits. The results of the company were the worst in the year 1969, because it
failed to chalk out suitable strategies necessary to take on its competitors in
the market. Sales at Woolworth began to decline. Consumers were reportedly not
satisfied with the quality of customer services of the company. Many of the
business sites were not at prime locations. Its new products could not attract
the customers because of lack of well trained staff and availability of ‘A
class service’. The company tried to improve its services in the year 1971 by
introducing new system of centralized payments besides closing its 23
unprofitable shops, as an attempt to trade up. The profits of the company
increased to some extent as a result of these
measures but it failed to boost up its profits at the desired level. The
competitors of Woolworth like Wal- Mart, Argos and Next very soon became more
prevalent in the market because of low prices, better service and vast range of
their products. The Management of the company ultimately decided to sell out
the Woolco stores in 1977. In the year 1981 it sold-out some of its valuable
prime located properties to cover-up the losses suffered by the shops situated
at these locations. Even then its profits went down in the said year and the
company was forced to cut the dividends first time since its establishment. In
the normal restructuring process during the year 1985, the company decided to
abandon the sale of food and adult clothing that was contributing about 30% of
its overall sales. The Management of the company sold out its 200 unprofitable
shops out of about 990, during the years 1982-1991. During this decade company
made a number of acquisitions in order to become more diversified in retail
business. It launched Music and Video Club that specialized in CDs, videos and
other entertainment products. The company succeeded in boosting its sales and
turnover during 1990s and gave impressive results despite the fact that some of
major chains like Wilkinson expanded their business in the Woolworth
areas.
Woolworth reviewed its entire business in the year
2002. It reconsidered its further expansion and realignment and merger of its
overall management structure. It strengthened infrastructure and planned
accurate management of its stocks so as to maintain them at their optimum
levels. It introduced new till system in order to ensure its stock holding
capacity besides provision of improved and efficient services to the customers.
The management decided to cut the number of suppliers and enhance the use of
their own branded products. These improvements contributed a little in the
sales as well as profits. One of main money spinners of the company was its
music business that collapsed. The financial results for the year 2004 showed
just 4.5% increase in the profits of the company. It had to compete strongly
with Argos in the sales of toys and gifts. In the year 2006, the company
introduced an in-store collection service for items ordered through website.
Company continued its business mainly in entertainment and electronics till the
year 2008. It expanded its chains and set up out of town stores that were known
as ‘Big W’. It announced considerable loss in its half yearly statement of
affairs as on 2nd August, 2008.
The management, therefore decide to sell out about
120 stores, cut jobs and reduce web operations. At this stage reportedly the
company rejected an offer to buy its 815 stores. From September onwards the
entire World entered into worst ever economic and financial crises that
resulted in decrease in availability of necessary credit from the banks and financial
institutions besides decrease in consumer spending.
The lending banks of the company not only refused to give further credits, they
also demanded repayment of their existing loans towards the company. As a
result of this crisis the retail business badly suffered. Media also reported
possible price crashes, increased personal debts, unemployment, pension
shortfalls, stock market crashes and decrease in availability of disposable
income.
Under these circumstances as well as in wake of
market saturations, coupled with economic downturn, it was highly difficult for
the Woolworth to maintain competitive pricing. Woolworth’s financial results
for the first half of the year 2008 showed 99.7 million pounds pretax loss.
Decreased credit availability, decreased public spending and pressure of
creditors to pay off debts of about 385 million pounds, forced the company to
sell out its 120 shops that were going in loss besides reducing the web
operations, cutting the products and axing the employees. These measures could
not help the company to survive and ultimately it suspended trading of its
shares on the 26th 0f November, 2009 and at last decided to close down its all
819 stores and axe its 27000 highly dedicated employees. The parent company of
Woolworth also announced its intention to go into administration on the 19th of
January, 2009.
Question:
(4 × 5 = 20)
1. Why Woolworths Failed as a Business?
2. What is the main focus or purpose of
Woolworths?
3. What challenges are Woolworths facing now a day?
4. What are the advantages of Global Expansion in
Retailing?
Assignment
Subject: Marketing Management
Q.4 Case study
Its Global Marketing Plans In the 1940’s itself
PepsiCo started branching out into the international arena. At first it was
into Latin America, the Middle East and the Philippines. Here too Coke had the
early bird advantage. Yet the product soon gained popularity. With the Arab
countries boycotting Coke, Pepsi enjoyed a monopoly for many years in the
Middle East. In the 1950’s Pepsi went to Europe and this included Russia, with
whom there existed a Cold War by USA. Though there were initial difficulties,
getting into Russia was a major breakthrough which the company exploited. The
company posted pictures of the then leaders of the United States and Russia
sipping the drink. Its arch rival, Coca Cola, was able to enter the Russian
markets only after more than 25 years after Pepsi’s entry.
In many of the countries that Pepsi ventured into
comparative advertising was prohibited and in many countries it was not an
accepted concept. For example, Pepsi tried its “Pepsi challenge” promotional
gimmick in Japan. However, the country and its people were not aware of
comparative advertising and as such the campaign did more harm than good. Hence
in Japan they had to break their tradition of running with the global campaign
and come up with a campaign that the Japanese would identify with and was more
Japanese. The “Pepsiman” was a superhero like figure that was devised by a
Japanese person for the Japanese market. The commercial was an instant hit and
helped improve Pepsi’s share in the Japanese market by as much as 14%. From
Japan Pepsi learned a valuable lesson – the same ad will not have the same
effect everywhere. When it comes to cross national advertising, there is always
the inherent risk of alienating the people.
Question:
(20 × 1 = 20)
1. What challenges Pepsi had to face, If Pepsi
would not follow the cultural factors in international marketing environment?
What is the good marketing way for pepsi?
Assignment
Subject: Marketing Management
Q.5 Case study
In 1980, Peter A, Horekens, marketing director for
Kellog company, was faced with the problem of developing a market for
ready-to-eat cereals in the Latin American region. Although Kellog had no
competition in the ready-to eat cereal market in this region, they also had no
market. Latin Americans did not eat breakfast as the Americans did. The problem
was especially prominent in Brazil. To create a market and increase sales in
this region, Horekens had to create a nutritious breakfast habit.
Kellog Company, which headquartered in Battlecreek,
Michigan, was founded in 1906 by W.K. Kellog. The company continued to operate
successfully with sales in 1980 amounting to 2,150.9 million U.S. Dollars. The
Kellog Company manufactured and marketed a wide variety of convenience foods
with ready-to-eat cereals topping the list. The company’s products were
manufactured in 18 countries and distributed in 130 countries. The ready-to-eat
cereals sales made up the majority of international sales.
In 1980, Kellog International operations accounted
for 38 percent of Kellog Company’s sales of more than $ 2.0 billion. The United
Kingdom was by far Kellog’s largest market. Internationally, sales in the ready-to-eat
cereal market continued to increase, although in the past few years the
competition also had increased. But in Latin America, consumption of
ready-to-eat cereals was negligible.
The Latin American Market
The Latin American Market, mainly Mexico and
Brazil, showed great potential as a Kellog’s ready-to-eat cereal market. The
demographics fit the ready-to-eat market, the only problem was that Latin
Americans did not eat the traditional American-style breakfast.
The Latin American market
included a growing number of families with children. The population mix was
becoming younger. The developing economy enabled consumers to spend more of
their income on food. Kellog wanted to increase sales in this Latin American
region, especially Brazil, but consumers had turned their backs on the American
style breakfast. How was Kellog to create a nutritious breakfast habit among
the Brazilians?
The company asked J. Walter
Thompson, Kellog’s advertising agency, to help instill the breakfast habit in
Brazil. According to Horekens, “In general, Brazilians do what people in
novellas do”. Novellas are Brazilian soap operas. J. Walters Thompsons tried to
advertise Kellog ready-to-eat cereal and instill the breakfast habit by
advertising within a soap opera. The first experience of advertising within a
soap opera failed; the advertisement portrayed a boy eating the cereal out of a
package. Kellog wanted to teach the Brazilians how to eat a complete,
nutritious breakfast, not just Kelloy’s cereal. The commercial did not work,
because it made Kellog ready-to-eat cereal seem more like a snack than a major
part of a complete breakfast. Kellog wanted to portray ready-to-eat cereal as a
part of a complete, well- balanced nutritious breakfast. Thus, they needed the
cereal to be eaten in a bowl with milk alongwith other foods to make a complete
breakfast.
The company believed that the
growing population in this region would reinforce the importance of grains as a
basic food source. The 1980 population in Brazil was 119 million, which made it
the sixth most populated country in the world and the population was expected
to grow to 165 million in the next few years. Within this population growth was
an increase in the number of women of childbearing age, which further supported
Kellog’s potential for a successful cereal market. The structure of the
population in Brazil in 1980 was:
∙ Thirty seven percent of
population under age 15.
∙ Forty-eight percent of
population under age 20.
∙ Twelve percent population over age 50.
∙ Six percent of population over age 60.
∙
These figures
showed that the population of Brazil better fit the market for a ready-to-eat
cereal, with the increasing number of children and elderly people as the two
largest cereal consuming segments.
The “cult of the family”
continued to be the most important institution in the formation of the
Brazilian society. This culture ideal was reflected in the ways they
conceptualized and evaluated the range of personal and social relations. This
seemed to be the way Kellog would have to demonstrate the importance of a
nutritional breakfast – by playing up the family and its importance. Through
the use of the novellas, Kellog made a second attempt to teach the Brazilians
the importance of breakfast. Most Brazilian families watched these soap operas,
composed mostly of family scenes. In their commercials, Kellog opted for scenes
that showed the family at the breakfast table. One member of the family,
usually the father, took the cereal box, poured the cereal, and then added milk.
This scene represented a complete
“Kellog” breakfast in a way that Brazilians could
relate to. The advertisement focused first on nutrition, then on flavor, and
finally on ease of preparation.
As a result of this campaign,
sales in Brazil increased. Kellog controlled 99.5 percent of the ready-to-eat
cereal market in Brazil; however, per capita cereal consumption was less than
one ounce or several spoonfuls per Brazilian annually, even after advertising.
Although Kellog controlled the market, there was not much of a market to
control. Brazilians had begun to eat breakfast, but Horekens was not sure
whether sales would continue to increase. His problem was – how could Kellog
further convince the Brazilians of the importance of eating a nutritional breakfast
in order to establish a long-term market?
Question:
(10 × 2 = 20)
1. Analyse the case to enable
you to prepare a report about the given situation.
2. What would be your advice – to continue or quit
– to the board of Directors of Kellog? Explain with reasons the factors which
you would consider essential in framing your report?
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