What is the industry partner’s business and what is the strategy?
To successfully increase market share, revenue, and profits, firms must normally follow three steps:
- Assessment of market(s)
- Evaluate the respective costs, benefits, and risks of the market
- Argue the reasons why the industry partner is operating in the market (potential).
Step 1: Assessments of Market:
- Basic Market Potential => Statistics of the market (size, growth)
- (Population, GDP, per capita GDP, public infrastructure, and ownership of such goods as cars and televisions, level of competition- how big are the top 3 companies and their relative market share?)
- Forces in the market => PESTEL, OT, Porter’s 5 forces
- (Inflation rate, interest rate, competitors pricing and distribution strategy, SW of competitors, market growth indicators and prognosis, trend analysis)
Step 2: Evaluate the respective costs, benefits, and risks of the market:
- Costs: Two types of costs are relevant at this point: direct and opportunity. Direct costs are those the firm incurs in entering a new foreign market and include costs associated with setting up a business operation. Opportunity costs are those that result from entering one market as opposed to another—a firm forfeits or delays its opportunity to earn profits in one market by dedicating its resources to another.
- Benefits: Among the most obvious potential benefits are the expected sales and profits from the market. Others include lower acquisition and manufacturing costs, foreclosing of markets to competitors, competitive advantage, access to new technology, and the opportunity to achieve synergy with other operations.
- Risks: Given the above two factors what is the risk of competing in the market?
- Identify stakeholder groups in the industry
- Identify specifically the stakeholders of the industry partner
- Identify the competitors of the stakeholders of the industry partner
- Analyse the specific stakeholders and competitor on the following factors:
- Financial aspects (profit and ability to earn money in the future)
- Moral/ethical values (societal norms for behaviour)
- Business interests (increase of present and future business)
- Environmental stewardship (protection of wildlife or vegetation)
- Ownership (do the stakeholder own the assets)
- Communication preferences (stakeholder adopts up to date technology)
- Demographics of the stakeholder
Professional Product Assignment: Conduct a Stakeholder Map for your industry partner by assessing 4 stakeholders on Power and Interest. Find the definition of stakeholder power and stakeholder interest and what a stakeholder map is.
If you are scheduled in the first Semester for EHL then for feedback on both the assignments you can send your reports to your respective marketing expert teacher in week 9 of the first semester.
If you are scheduled in the second Semester for EHL then for feedback on both the assignments you can send your reports to your respective marketing expert teacher in week 9 of the second semester.