Strategic Marketing - Business Plan Example

Competitive strategy for GM Motors By Presented to Introduction General Motors is the leading manufacturers of vehicles in Europe with the focus or target clients varying significantly. Despite the varying target markets, the companies are in stiff competition, to increase market share, and reduce cost of operations. One of the strategies to be employed by General Motors includes the diversification and relocation of assembling plants. General Motors has ventured into South Korea by opening assembling plants in the country (Preston, 2012, p. 68). General Motors can engage in partnerships with other manufacturing companies in order to reduce set up costs. Through creating assembly lines of the different companies, GM has managed to reduce costs of operation reducing the prices of the final products. Despite the success of the strategies employed by the companies, the major threat to the profitability and competitiveness for the companies is from Japan, namely, from Toyota and Nissan companies which produce products at affordable cost making the cars a preferred choice for consumers in developing economies. However, the competitive strategies of the two companies vary significantly based on the focus of the company and the need for change (Allen, 2010, p. 56). The General Motors have focused on the production of high quality vehicles such as the jaguars and the acquisition of the Chrysler brand, which targets the higher echelons in the society (Shaw, 2011, p.111). Globalization and strategy The growth in internationalization and opening of global access to markets is as a result of the changes in technology which has led to faster access to products and services coupled with faster payment models. Before the growth in technology, several companies tried to engage in internationalization, but with minimal success in both long and short term. The failures the occurred during the time was as a result of several issues relating to the target countrys economy and other related changes that occurred in the local market. Companies such as Marks and Spencer tried to open shops in other European markets, but never succeeded in the process resulting in the closure of outlets due to increased operating costs. The situation has changed significantly over one decade and the result of the change can be witnessed through the success of online marketing strategies and global marketing strategies. The development of the strategies on the methodology and approach to the different markets is an operation of immense importance because of the difference in economic, environmental and political conditions of the target will adversely affect the strategies to be employed and the success of the product in the market. Situational analysis According to the American Marketing Association (AMA), situational analysis is “the systematic collection and study of the past and present date to identify trends, forces and conditions that have the potential of influencing business” (Bratton and Gold, 2001, p. 67). The financial position of the company is strong, and the values are attached in Appendix 2. Appendix 2 indicates the situation of the company and the performance. Product situation This is the analysis of the current product or the modification done so as to establish the product position in the market. The definition of the product is significant at this stage to be able to evaluate its ability to penetrate into the market, especially if it is a new product (Zanko, 2003, p. 134). Additionally, it enables the business to choose appropriate promotional and advertising strategy. The product situation is vital for the planning of the marketing strategy (Saget, 2006, p. 56). The situation of the company is depicted in the values of the shares in the NYSE, as depicted in Appendix 1. The share value, over the last week, has been the stable indicating success of the company. Competitive analysis It involves researching on the competitors both directly and indirectly. The analysis is indispensable for the establishment of the relative position of the organization in relation to the competitors. Several factors can be employed in the analysis including the use of sales and profit figures, price, product attributes, market position and customer service attributes (Beverly and Thomson, 2011). The strength and weakness of the business are also analysed in the process. The major strength of GM is the global availability of the products and service, which increases brand visibility and encourages the development of product acceptance. Distribution situation The distribution situation of the business is noteworthy because it affects product visibility and accessibility. These factors affect the performance of the product in the market leading to an increase or decrease of the sales volume (Torok, 2010, p. 134). The method of distribution employed is vital and includes use of distributors or intermediaries. The method employed may affect the price and profit margins. Environmental factors Environmental factors include external and internal factors that affect the performance of the product. The internal factors that should be explored include sales volumes, profitability, customer mix, data on customer complaints and perceptions (Anushree, 2012). This analysis is helpful in the evaluation of internal departments to give insights of the performance of the product. SWOT Analysis of GM Internal strengths 1. Powerful research and development with strong engineering background. 2. Strong service network and sales agent. 3. Efficient production Internal weaknesses 1. Immense reliance on few products because of failures of models. 2. Rising production costs in America. 3. Financial crisis arising from the global financial crisis of 2008-2009. External opportunities 1. Increasing demand of luxurious cars via diversity. 2. Executive brands offer great competition. SO: 1. Develop product service centres that facilitate service delivery. 2. Create a new assembly plant to increase efficiency through automation. 3. Build new models for the American market. WO: 1. Develop compatible models with different pricing level. 2. To cope with rising costs in America, build plant in South Korea. 3. Dealing with Korean labour unions. External threats 1. Exchange rate changes in valuation of dollar in the global markets. 2. Competition from Japanese and German car makers. 3. Pricing and shortage of fuel. ST 1. Maintaining exchange rate in globalization. 2. Counter competition using by reducing costs and improving technology. 3. Increase effectiveness in fuel consumption. WT A. Suppress weakness by using opportunities. 1. Increase the competitive advantage through flexible line of production. 2. The cooperation and merger with other manufacturing companies. Recommendations Upon the completion of objectives and goals, the development of the strategy and tactics is undertaken. Strategy is defined as broad statements of activity, while tactics are statements of activity that are actionable. During the process of identification of strategies and tactics, the strategy and tactics must be realistic (Daugherty, Chen, Mattioda, and Grawe, 2009, p. 89). The process may require brainstorming of all the activities that can be undertaken, with the level of significance and importance being used during the review of the priority of actions and resource availability (Legge, 2005, p. 213). Once the strategy and tactics have been developed, the process of delegation and assigning of responsibility is undertaken. Use of promotions and exhibitions Increase in sales and product visibility is only possible through promotions. The major objective in promotions is to increase the product visibility by increasing product awareness by 15% in a period of five years. The activities involved in promotion include use of showrooms and exhibition. Brand is critical in the promotion of GM. Established brands enjoy relative success of the products introduced in the market as such hence the need for creation of a strong brand with an extraordinarily powerful brand image. Social media marketing Social media is essential in marketing because it increases brand visibility and allows for the development of a new approach and strategy to consumer maintenance. Social marketing methods target customers with the ability to access the social media. In the sales and marketing, social media is used in the maintenance of communication with the target customers. With the development of online payment platforms, the ability to sell to a variety of clients instantly has been developed. Additionally, the new approach has shaped the sales and marketing department with increased brand loyalty (Malaval and Benaroya, 2002, p. 234). Brand loyalty strategy Establishment of the brand helps in the creation of a strong customer care department with the understanding of the new media approaches. With the increased information transfer, it is easy for the company to enjoy success but suffer failure if it does not have a powerful customer care department that is in touch with the other departments of the company. Manufacturing is dependent on product specification, which is a product of market research. Social media increase the speed of market research by allowing for ease of data collection (Sandhusen, 2000, p. 88). The data are useful in the process of designing, which is the final product of research. The design of logistics both in-bound and out-bound significantly depends on demand and supply of the raw materials and the finished product. The final product must be transported and supplied to the demand areas at reasonable units to reduce costs and optimize profits (Ivancevich, 2006, p. 78). With the development of a new approach to logistics and marketing that is dependent on the use of social media, it is possible for the business to optimize profits. Human resource management is improved by the use of the media in the process of recruitment and evaluation of the company personnel (Fisher, 2000, p. 345). Internationalization Venturing into the global markets will improve the success of GM by reducing the production cost and increasing the company products. Manufacturing units can be relocated to countries with lower production costs such as South Korea, South Africa and other favourable countries (Hollensen, 2007, p. 177). However, challenges still exist in internationalization, especially the global financial crisis and the existing political instability in some of the countries in the world (Wood, 2009, p. 143). Internationalization will ensure greater revenue collection and increased productivity. Possible workable recommendation is that organizations should focus on joint ventures and establish a partnership name by working together with an already established business. The kinds of facilities which are expected to be in a spectacular institute are not easy to provide, they need thorough research, the suppliers are to be carefully selected with quotes on what they are offering as well as the quality they are offering. Faculty which needs to be hired should be of an excellent aptitude, flexible, dedicated and should instil values in students that should last forever. Shaping future minds is responsibility hard enough to cope up with; in this the administration has to be active and knowing about the market itself. Direct marketing In direct marketing, GM can communicate and promote products and services to niche markets through customized advertisement among other promotional methods. In creation of advertising strategy, GM motors aims at ensuring that its ads are seen by potential clients who end up buying the products. From here, GM motors is able to evaluate the effectiveness of the promotional method adopted by tracking what number of people visiting the site. The internet has helped GM motors in its public relations strategy by facilitating the communication of its corporate information and products on offer to potential consumers Conclusion The success of a company in the market depends on the ability to address issues of marketing and developing the necessary strategy for marketing and promotion. In addition, interaction with consumers can be seen to have played a vital role in ensuring there is customer feedback and hence increased satisfaction. Bibliography Allen, J. (2010). Marketing Your Event Planning Business: A Creative Approach to Gaining the Competitive Edge. London: John Wiley & Sons. Anushree, B. (2012, June 20). Cannes Lions 2012: Five-points to a great marketing strategy. Available at Cannes Lions: http://www.afaqs.com/news/story.html?sid=34444_Cannes+Lions+2012:+Five-points+to+a+great+marketing+strategy [Accessed 10 July 2012] Beverly, M., and Thomson, T. (2011). The Power of Real Time Social Media Marketing:How to Attract and Retain Customers. New York: McGraw-Hill Professional. Bratton, J., and Gold, J. (2001). Human Resource Management: Theory and Practice. London: Routledge. CrawFord Motors, M. (2000). Marketing Research and the New Product failure Rate. Journal of Marketing, 51-78. Daugherty, P. J., Chen, H., Mattioda, D. D., and Grawe, S. J. (2009). MARKETING/LOGISTICS RELATIONSHIPS: INFLUENCE ON CAPABILITIES AND PERFORMANCE. Journal of Business Logistics, 1-18. Fisher, C. M. (2000). The Ethics of Inactivity: Human Resource Managers and Quietism. Business & Professional Ethics Journal, 55-72. Hollensen, S. (2007). Global Marketing: A Decision-Oriented Approach. London: Prentice Hall. Ivancevich, J. M. (2006). Human Resource Management. 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Available at Articles for Business Professionals: http://www.torok.com/articles/marketing/MarketingArtorScience.html [Accessed 21 June 2012] Torrington, D., Hall, L., and Taylor, S. (2008). Human Resource Management. New York: Financial Times Prentice Hall. Wood, G. (2009). Human Resource Management: A Critical Approach. London: Taylor & Francis. Zanko, M. (2003). The Handbook of Human Resource Management Policies and Practices in Asia-Pacific Economies, Volume 2. Oslo: Edward Elgar Publishing. Appendix 1 Performance of GM on the stock market in April 2013 Appendix 2 General Motors Company (GM)  -NYSE 27.52  Balance Sheet Get Balance Sheet for:  Quarterly Data All numbers in thousands Period Ending Dec 30, 2012 Sep 29, 2012 Jun 29, 2012 Mar 30, 2012 Assets Current Assets Cash And Cash Equivalents 19,108,000   24,183,000   22,918,000   18,302,000   Short Term Investments 8,988,000   10,411,000   11,381,000   14,686,000   Net Receivables 23,868,000   16,759,000   14,595,000   15,799,000   Inventory 14,714,000   15,672,000   15,433,000   15,844,000   Other Current Assets 3,318,000   5,082,000   5,906,000   4,585,000   Total Current Assets 69,996,000   72,107,000   70,233,000   69,216,000   Long Term Investments 13,837,000   14,374,000   13,610,000   12,955,000   Property Plant and Equipment 25,845,000   28,099,000   26,350,000   25,341,000   Goodwill 1,973,000   28,408,000   28,405,000   28,433,000   Intangible Assets 6,809,000   8,904,000   9,192,000   9,687,000   Accumulated Amortization -   -   -   -   Other Assets 3,040,000   3,564,000   4,197,000   4,562,000   Deferred Long Term Asset Charges 27,922,000   -   -   -   Total Assets 149,422,000   155,456,000   151,987,000   150,194,000   Liabilities Current Liabilities Accounts Payable 48,474,000   51,345,000   51,559,000   51,227,000   Short/Current Long Term Debt 1,748,000   2,277,000   1,360,000   1,557,000   Other Current Liabilities 3,770,000   4,001,000   3,732,000   3,793,000   Total Current Liabilities 53,992,000   57,623,000   56,651,000   56,577,000   Long Term Debt 3,424,000   3,314,000   3,783,000   -   Other Liabilities 55,006,000   51,890,000   49,943,000   40,723,000   Deferred Long Term Liability Charges -   -   -   12,754,000   Minority Interest 756,000   970,000   910,000   884,000   Negative Goodwill -   -   -   -   Total Liabilities 113,178,000   113,797,000   111,287,000   110,938,000   Stockholders Equity Misc. Stocks Options Warrants -   -   -   -   Redeemable Preferred Stock -   -   -   -   Preferred Stock 10,391,000   10,391,000   10,391,000   10,391,000   Common Stock 14,000   16,000   16,000   16,000   Retained Earnings 10,057,000   11,533,000   9,889,000   8,283,000   Treasury Stock -   -   -   -   Capital Surplus 23,834,000   26,443,000   26,399,000   26,334,000   Other Stockholder Equity (8,052,000) (6,724,000) (5,995,000) (5,768,000) Total Stockholder Equity 36,244,000   41,659,000   40,700,000   39,256,000   Net Tangible Assets 27,462,000   4,347,000   3,103,000   1,136,000   Read More