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Logitechs Quality of Strategy - Case Study Example

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Their product line incorporates Internet video cameras, mice and trackballs, keyboards, audio and telephony products, interactive gaming devices and 3D controller.
Logitech's founding stones were kept in Apples, Vaud, Switzerland, in 1981 by two Stanford Masters alumni, Daniel Borel and Pierluigi Zappacosta, Logitech revolutionized the computer peripheral industry by introducing the first mouse ever it now leads the computer industry with a wide range of innovative products that ease the PC navigation.
Logitech's specialty is creating an interface between humans and the digital domain. But what started out as a niche market is now a major business operating in more than 150 countries worldwide, maintaining an excellent global brand image with huge shelf space and an extended line of products. "Each year, we roll out 100 new products," claimed Sandro Isteri, Director Swiss Operations Logitech International recognizing the leadership of its company.
Logitech's success pivots on a number of factors of which the greatest change was the recruitment of Guerrino De Luca, the current President And CEO of Logitech International, in 1997. Guerrino De Luca had the experience that Logitech needed when he became its president and chief executive officer in 1998: he was an engineer who knew marketing. Under his direction, sales of Logitech products exploded, in less then a span of seven years Logitech's Co-founder and current chairman saw its not so very competent company quadrupling profits every year and leading the charts in NASDAQ and Japanese exchange.

De Luca's achievements at Logitech accounted for his outstanding leadership and innovative qualities, firm determination and above his luck, "As our luck always worked for us.." remarked De Luca while discussing he thoughts on company's performance at a quarterly meeting.

Logitech's business strategy has centered on efficient pricing and innovation and the major change that De Luca brought to the company was a swing from technology-centered operations to Consumer-centered policies. He realized that despite being in the technology business, the focus should be on successfully marketing the product rather eliminating technological barriers. This is the reason why Logitech's products are efficiently designed and aesthetically developed. "People buy our mouse because it glows", said De Luca emphasizing on the need to lure customer with visual quality and design.
The Key factor of De Luca's leadership was a revision of market segmentation strategies which resulted in shift from OEM (Original Equipment Manufacturer) products to high-margin branded commodities for the retail market. This adjustment to the target market worked wonders for Logitech as it was exposed to the mass market segment and by the Fiscal Year 2006 it generated 89% of its revenues from the retail market.
In less then two years, at the brink of the Millennium posed huge threats to its closest competitor Microsoft and it now positioned itself as the company providing accessories to users of PC rather than only novel buyers.

Logitech's management soon realized that in order to rule the market it was necessary to concentrate on the basic principle of Marketing and to employee the "You" attitude with the customers and actually finding out what they want rather then mere assumptions. For this purpose a more flat ...Show more


Fundamentally, we don't sell to people who buy new PC's, only in part. We sell to people that use PC's so our base is enormous," De Luca, President and CEO of Logitech International remarked while reporting and analyzing his best sales figures ever in the fourth quarter of 2006…
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