Week 9 Project Deliverable 4 - Submit here

Innovation and Competitive Analysis

Elhousany Abosamra

Dr. Evangeline Jefferson

Management Capstone - MGT 599

04/22/2019

The CEO should lead the management in the development of marketing plans that will enhance market positioning, positioning of a brand and, cost leadership which incorporates product differentiation. The company should strive to establish a market image that reflects the quality and assures customer's satisfaction. (Noe, 2017) Cost leadership is the most effective method to drive sales because customers always want to get satisfactory products at prices that are affordable. This particular company can set prices lower than the other companies in the market.

Porter’s five forces

Supplier power is a determination of the ease for suppliers to drive up prices. The supplier power is dependent on the number of suppliers of essential inputs in the market, the differentiation of their products or services, their size and strength and also the cost that comes with switching from one supplier to another. In this analysis of the market, the number of suppliers is large and the cost of switching from suppliers is actually very low. The supplier power is little due to high competition among suppliers who supply almost similar products. (Mathooko, 2017)

Buyer power is the ability of buyers to affect the prices and usually, buyers will drive prices down using their bargaining power. The buyers' power is determined by their numbers in the market, their importance to the businesses and cost of customers switching suppliers. A business that has few powerful buyers can be affected adversely by the buyers' bargaining power. The company, in this case, is positioned perfectly because it has many loyal customers who keep the company sales at a favorable level.

Competitive rivalry is mainly attributed to the number and capability of competitors in the market. A market that has companies that provide undifferentiated products and services reduces the market attractiveness. The market in this analysis has several companies that provide similar products to consumers. The company needs to stand out and establish a brand name that customers can identify with. (Mathooko, 2017) The company should be focused on gaining an advantage over the competition such that it will emerge as a market leader both in price and quality.

The threat of substitution exists when there are close substitutes in the market, this really increases the probability of getting alternative products when there is even a slight increase in prices. Availability of substitute goods in the market reduces the supplier power and general attractiveness in the market. The best approach to mitigate the threat of substitute goods, the company should focus on coming up with differentiated products that have a high quality such that customers will not find a reason to use alternative products.

The threat of new entry in the market is usually due to the attractiveness of the market in terms of profitability. If there are many entrants supplying similar products the profits are reduced unless the incumbents have measures and long-lasting barriers to block new entrants into the market. Some of such barriers include patents, economies of scale, high minimum capital requirements or government policies that limit new entrants. (Mathooko, 2017)In this case, the company is well placed because it is difficult to have new entrants, the main challenge is posed by existing companies such that proper strategies will ensure the company gets a lion’s share of the profits.

Innovative and technology trends

The market is evolving and various strategies are employed in attempts to push up sales and establish a market position. Companies are working towards a better consumer’s perception in relation to competing brands. Creating a positive image enables customers to perceive the company products in a certain positive way such that they will most likely buy products they believe are better. The current trends include accelerated mobile pages where Google traffic searches are boosted. (Noe, 2017) The other one is email and marketing automation where subscribed customers are updated about new products and offers in the company, the emails are usually personalized such that the company establishes a relationship with the customers which is key in promoting sales.

The two trends that the company should employ are Artificial Intelligence and Chatbots. Artificial intelligence is used to get customer segmentation, retargeting customers, push notifications and click tracking. This is a winning move in marketing and the company has properly used it to grip the market and aims at becoming a market leader. (Noe, 2017) The other technological trend is using chatbots where the company has added a special feature to its website for customers to interact and get their concerns addressed. This feature is great because it is even economical in the aspect of staffing. The chatbots can respond to customer’s concerns almost immediately and creates a lot of effectiveness.

Feasibility analysis

Market feasibility analysis is important to increase market share by leaps and bounds because the analysis reveals a complete SWOT Analysis to strengthen competitiveness. The management always implement ideas that are viable and profitable to the business. In this case, we focus on economic, legal, operational, schedule, financial and resource feasibility. Market Basket Analysis is the assumption that a customer establishes a trend of buying particular products repeatedly. (Mathooko, 2017) Customer Churn is identifying common characteristics of customers who are likely to switch to the competitors and making the right adjustments to keep them.

Risk Analysis is also important in assessing feasibility because categorizing risks before they happen enables development of countermeasures. Fraud Detection is vital in flagging spurious transactions and the other approach is Interactive and Predictive analysis. This identifies the latest orientations in the market and predicting the future trends in marketing. (Mathooko, 2017) The company is well placed in the feasibility analysis as explained, the risks are mitigated and the customer satisfaction is upheld. There is less likelihood of customers switching to other competitors because they are satisfied both by quality and prices.

Conclusion

I am of the opinion that the company is well placed to take advantage of the opportunities in the market. The company has the capabilities right from the management and a strong supportive structure of staff. Resources are available to support the technological changes that are meant to boost the sales of the company. The organizational structure does not impede the development and success of the company. One of the major efforts is the installation of strong technical facilities that enable the company to experiment and implement new marketing plans.

References

Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource management: Gaining a competitive advantage. New York, NY: McGraw-Hill Education.

Mathooko, F. M., & Ogutu, M. (2015). Porter’s five competitive forces framework and other factors that influence the choice of response strategies adopted by public universities in Kenya. International Journal of Educational Management, 29(3), 334-354.