market buzz
TRANSCRIPT
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BY: Sonakshi Kalra (M00427220)
Firangiz Akbarzade (M00387317)
Aveenash Sekhar (M00190946)
Market Buzz International: A
CASE STUDY
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MARKET BUZZ INTERNATIONAL: CASE STUDYGROUP ASSIGNMENT
NAME AND MISIS NO: Sonakshi Kalra (M00427220)Firangiz Akbarzade (M00387317)Aveenash Sekhar (M00190946)
COURSE: MA marketing communication
MODULE TITLE: Strategic Marketing
MODULE CODE: MKT4100
WORD COUNT: 3492
SUPERVISOR: Dr. Doug Young
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MARKET BUZZ INTERNATIONAL: A CASE STUDY
Table of Contents
ABSTRACT .................................................................................. 4
INTRODUCTION ........................................................................... 4
COMPETITIVELANDSCAPE ....................................................... 5
SOCIAL MEDIA ERA .................................................................... 6
NICHE STRATEGY ....................................................................... 8
RELATIONSHIP STRATEGY ....................................................... 9
QUESTIONS FOR THE CASE STUDY ....................................... 10
REFERENCES.............14
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ABSTRACTThis case study details the start up and growth of Market Buzz International, a
small-scale marketing consultancy in the Middle East. The corporate vision of
the company is to make a difference in the small and medium sized business
clients and creates satisfied customers to attain success. The objectives of
the company have been to gain a sustainable competitive advantage and
work towards the growth of the organization. The case study begins with an
introduction section, which includes the complete background of Market Buzz
International. The competition of the company has been described by an
accurate industry analysis using porters model to explain the basic nature of
the industry. The following sections also explain obstacles faced by the
company in its journey such as the changing social media, cut throat
competition and lack of financial and human resources. The company made
strategies to overcome these obstacles. An advanced strategy was adopted
by MBI to overcome the changing face of social media marketing. To gain acompetitive edge in the industry the company followed a niche strategy and a
relationship strategy implying the importance of collaborations and alliances
was taken up to deal with the limitations of financial and human resources.
INTRODUCTIONIn the year 2000, Mita Srinivasan started the company Market Buzz
International. A small-scale business, MBI is a marketing consultancy
company, which provides clients services like advertising, PR, brand building
and communications support to new and existing businesses in the middle
east. The company has a small team of five members and works with
freelancers for certain projects. MBI combines its own expertise and
resources with the outsourced strengths of experienced freelance executives,
providing its clients access to a wide network of industry professionals. MBIs
focus is technology and gives technical solutions to small and large
companies. The company goes beyond contractual obligations to satisfy
customers and works diligently to humanize the business. The slogan of the
company your voice delivered by our passion shows that the company lays
emphasis on being passionate about the projects taken up and the team is
result oriented aiming to create a difference in the customers business.The growing sophisticated demands of consumers have led the business to
understand the importance of marketing and social media to make the
business a success. Thus companies are looking for professional consultants
to build up brand image and market the products effectively. The industry of
marketing consultancies is increasing which in turns increases the competition
for MBI. The small-scale businesses are important for an economy and the
strategies adopted by them should be studied. (Cooper et al, 1986). The
business objectives of the company have been to grow in the industry and
attain a sustainable competitive advantage. The company has faced many
challenges in these years due to the changing scenario of the market.
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COMPETITIVE LANDSCAPETo attain the objective of sustainable competitive advantage it is important to
know the positioning of the company as well as competitors. It is vital to
analyze the competitive forces of the industry. MBIs competitive forces can
be understood by Porters five-force model, which gives information about the
industry and competition of the company and forms the basis of strategies
followed by the company.
PORTERs FIVE-FORCE MODEL
The five forces of MBI are explained as follows:
Bargaining power of customers: The bargaining power of customers
can bring down the profitability of the consultancy industry. They pose
a threat of integrating backwards which increases their power. The
bargaining power of consumers is mediocre in this industry as they
can lower the prices of the services due to large number of
competition but to achieve success in their business they have to
seek professional help, which suits their company. Threat of new entrants: The business can enjoy a better position and
profits if there are barriers to new entrants in the industry but MBI
faces a high threat of new entrants as there are no barriers to entry
and the business can be put up with limited capital and experience.
The new era of social media as and its usage has given rise to large
number of companies entering the industry and continues to enter.
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Bargaining power of suppliers: If the supplier forces up the price paid
for inputs, profits can be reduced. The bargaining power of suppliers
is low in this industry as the cost of switching to a different supplier is
low and large numbers of suppliers are present in the industry with
advanced technical skills and knowledge. Threat of substitute products: The extent of threat from substitutes
depends on the price and performance of the substitute. The
substitute for this industry is online, do it yourself software available
for business to develop strategies and help marketing their
companies at a low cost but the professional help need for starting up
and building a brand cannot be completely substituted by software.
In-house marketing and media team is also a substitute but involves
high cost of maintenance and thus the threat of substitutes is low.
Competitive rivalry: It relates to the competition for market share in
the industry. The industry has large number of small and large
marketing and communications consultancies, which leads to nominal
profits being earned. The current competition in this industry is heavy
and leads to loosing of projects to other clients.
By analyzing all five forces a complete picture of factors influencing
profitability of the industry can be obtained. The game changing strategies
can be developed at an initial stage (Porter, 2008). The above model
analyses the industry of MBI and gives and thus develop basis to understand
the strategies followed by the company. The model represents the key factorsrequired for sustainable competitive advantage and value added drive from an
analysis of the industry and its market structure which includes the number of
firms and degree of rivalry, market conduct which shows how firms behave
with each other which influences strategy and the overall market performance
of the company. The following sections shows the strategies used by Market
Buzz International keeping in mind the five-force model by porter.
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SOCIAL MEDIA ERAAs mentioned above the companies main objectives are to gain a sustainable
competitive advantage and a to have internal growth and an important
obstacle faced by the company to reach its goal has been the evolution of
social media.
Social media is not a traditional way of advertising. It is a way to communicate
with the audience and involves skilled knowledge about the market and the
business to successfully implement it in the business. In todays world social
media can make or break the business and MBI understands the value of
social media and thus it uses extensively when marketing or building a brand
image for its clients. The company also uses social media to market itself and
build an online reputation for the business. The current state of flux in the
evolution of social media makes it difficult to pick a platform as the Facebook
changes frequently whereas Twitter goes up and down in popularity, LinkedIn
has set of etiquettes and rules to be followed and sites like MySpace havefallen off the map altogether. Apart from instability of the social media the
security is always a difficulty, which is considered as a major threat to the
business.
The company uses an advanced strategy to overcome the dangers of social
media and use it effectively. The advanced social strategy goes beyond the
normal social media presence. It reinforces the marketing message while
pushing the user to another profile. (Balwani, 2009) MBI thus uses this
strategy by using multimedia messages. It develops the campaigns for its
clients based on multimedia to attract attention to the company it is marketing.It also integrates offline and online advertising which develops a better
communication process and builds customer interest. Company believes in
customizing different messages for different sites so as to have the planned
affect on consumers and also helps to avoid repetition. The company also
believes in open communication with its consumers on a regular basis. The
owner of the company regularly writes blogs and is active on Facebook so
that potential customers and existing customers can communicate with the
company without any barriers and their ideas are also shared on social
network sites. MBI handles social media without it becoming a time drain and
also ensures that the privacy concerns of the clients are well taken care of by
contemplating what is safe to divulge in a social setting.
Therefore the company recognizes the fact that social media is here to stay
and uses it widely to attain success. It has a social optimization system (SOS)
which involves developing a consistent plan for social media usage,
measuring its effectiveness and follow up to make the required changes. This
leads to optimum utilization of resources and maximizes the customers
satisfaction.
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NICHE STRATEGYThe above competitive landscape and industry analysis shows that MBI faces
a lot of competition in the industry. Businesses have recognized the need of
professional media and marketing consultancy to succeed and thus to satisfy
these growing needs a large number of marketing consultancies have come
up. The evolution of social media and its significant effect on the marketing
world has also added to the competition of the company. The company
understands that in this fast growing competitive industry it is imperative to
have a sustainable competitive advantage to succeed, grow and have a
leading position in the long run so that major projects are not lost to
competitors.
The competitive strategy used by MBI is niche strategy, which involves
reducing the size of playing field and concentration on a segment of market.The emphasis is laid on niche strategy by MBI so that they can capitalize on
the power of leverage, which means the power of doing more with less. The
company does market segmentation for which it uses different customer
requirements to segment the market. The company concentrates on B2B
market and thus focuses on this segment. It looks for unmet needs and needs
the existing companies are not completely meeting. It makes and effort to
know what the consumers want more than the consumers and start with the
consumers and not the services they provide. All these factors form the part of
niche strategy. The company strengthened its position by finding a segmentthat is B2B segment that targets the IT sector as it has immense knowledge
and experience in the IT sector.
Market Buzz International uses the focus strategy. It focuses only on a part of
the industry rather than the whole industry. IT targets a narrow segment and
within that segment tries to provide differentiated services based on
information technology and also capitalizes on its experience and skilled IT
journalist in the Middle East. . MBI is a small sized business with limited
capital and thus cannot compete with large firms on low cost and
standardized products as the company needs to cover its operational
expenses and also expenses incurred on freelancers for the completion of
Minimizing the playing field can reduce the barriers and thus niche strategy
was adopted. To successfully implement the focus strategy the company
works to define the target market effectively and also look for unmet needs
that are not met by existing companies. Using mobile technology to do
marketing can be an example of such needs that business marketed using the
applications present in the smartphones. The focus strategy proved to help
the company to concentrate on its strengths and manage the target
consumers at a low cost, which is essential for a small-scale business like
MBI. (Cooper, Willard & Woo, 1986).
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RELATIONSHIP STRATEGYStrategic relationships among suppliers, producers and distribution channel
organizations occur for various reasons. It can be done to enhance value
offerings, reduce the risks generated by business changes, share
complimentary skills or obtain resources beyond those available to the
company. (Cravens & Piercy, 2003). MBI uses the relationship strategy due to
the lack of human resources. MBI lacks human resources as it works with a
team of only five members and uses freelancers for certain projects. It is not a
magnet for talent from elite educational background, as it cannot offer high
compensation due to the lack of financial resources, as it is a small-scale
business. The lack of staff also affects the continuity of the business, as the
company is solely dependent on the founder Mita Srinivasan and there is no
successor to the founder.
MBI has thus collaborated with and is part of the OXYGEN Group (Network)
helping to represent several of its European clients in the Middle East region.OXYGEN initially focused on the new technologies sector, but its uniquebusiness model and professional consultants have since achievedoutstanding results in many other industries, including consumer goods &services, healthcare & early years, gastronomy and lifestyle, sustainabledevelopment, construction, corporate, and humanitarian aid.
(http://www.themarketbuzz.net/aboutus/)Thus MBI collaborated withOXYGEN to reach new horizons in the business. This collaboration alsohelped MBI reach market outside the Middle East and boost its growth withlimited human resources.
The company also believes in strategic alliances, which involves collaborative
relationships between the company and its competitors. MBI uses these
alliances to enhance the market position in the market and add value to their
services. It maintains a cordial relationship with its competitors and works with
them on certain projects and thus it involves actively participating in a
common project that is strategic in scope. The competitive realities of
surviving in the changing industry encourage companies to form alliances.
MBI thus understands the importance of alliances as being a small scale and
not having enough resources can pose as a threat and alliances helps in
pooling of resources and so reduces the risk of the company. The companyalso learns new skills from alliance partners and these alliances provide an
edge to the company and assist it to manage time and resources effectively to
gain success and work towards growth of the company. Trust and
commitment between the partners are critical in building these relationships.
http://www.themarketbuzz.net/aboutus/http://www.themarketbuzz.net/aboutus/http://www.themarketbuzz.net/aboutus/http://www.themarketbuzz.net/aboutus/ -
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QUESTIONS FOR THE CASE STUDY
1.How should Market buzz international face the growing competitivelandscape to gain a competitive advantage?
MBI faces direct and indirect competition and to prosper in the marketingconsultancy industry the company needs to understand the competitive pointof difference. The business having a sustainable competitive advantage cansurvive in this cutthroat competition. This is explained with the help of PortersModel.
It can be seen from the above figure of porters generic strategies that a firmsstrengths can fall into two categories that are cost advantage anddifferentiation. (Porter, cited in Dess and Davis) These strengths can beplaced in either broad or narrow scope giving rise to three generic strategiesthat are cost leadership, differentiation and focus.The generic strategy of cost leadership involves selling the product orservices at lower prices than the average industry prices to gain a widermarket share and thus attain higher profits whereas differentiation strategyinvolves development of product or services that are unique from that ofcompetitors and consumers value the uniqueness that the business offers andthus can charge a premium price for it. Lastly, the focus strategy includestargeting a narrow segment and within that segment makes an effort toachieve cost leadership or differentiation. Thus it can be seen from the casestudy that Market Buzz International competes with the focus strategy. ForMBI to have a sustainable competitive advantage only focus strategy is notenough. According to porters model a successful business should competeonly on one of the three generic strategies where as Wright (1987) believed ina combination of strategies that can be adopted to attain success and the sizeof the business plays an important role in deciding upon the competitivestrategy.
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A differentiation strategy yields a longer lasting and more profitable edge overthe competitors when based on factors that provide unique customer value.(Hammer et al, 1999) Market Buzz International success can be achieved byfollowing differentiation and focus strategy simultaneously. MBI has theexperience in local market on which the company can capitalize to earn
higher profits. The company also has a team of highly skilled technicalexpertise and an advanced knowledge of social media usage with a creativebond. MBI should aim to provide superior customer service to follow thedifferentiated strategy with its experience and expertise. The company alsohumanizes the business, and it also manages online reputation to ensure thatcustomers are satisfied and the company is marketed well. Thesecompetencies can provide unique customer value and in addition to these thecompany could ensure an impeccable security system to its customers so thatthey do not shy away from social media due to privacy concerns. Thesefactors can be taken into consideration to differentiate the services providedby MBI and its competitors to earn a premium profit along with the niche
strategy the company follows.
2. Is the relationship Strategy followed by Market Buzz Internationalenough to overcome the hurdle of limited human resources to achievesuccess and ensure the continuity of the business?
MBI works with a team of five permanent members, which affects theoperations of the company and also is a threat for the continuity of thebusiness. In this changing era of business the companies prefer asophisticated system of work and when companies search for marketingconsultancy they prefer a consultancy with all in-house talent company ratherthan company that outsources due to the difficulty in trusting the third partyand also the additional mark- ups from third party suppliers are notappreciated. The relationship strategy of the company poses many risks asthe company can loose its power and the credibility of the company can alsobe questioned. The alliances formed can be fragile and ineffective in the longrun. It is thus integral to have a strategic human resource management thatprovides the company with an internal capacity to adjust to their competitiveenvironment and exploit the growth opportunities. (Barrett & Mayson, 2007).
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The following diagram explains the HR strategy that can be adopted.
MBI HR STRATEGY FRAMEWORK:
As shown in the diagram HR strategy is divided into stages to have a clear
understanding of the strategy and thus attain success.
FIRST STAGE: the first stage involves the client-based satisfaction, which
can be achieved through the right amount of members in the organization.
MBI should thus recruit more members in the company, as a team of five
members is not enough to provide impeccable services to the clients and also
it leads to loosing of major projects that could help MBI grow.
ACHIEVING THAT MBI HAS THE
REQUIRED PERSONNEL
OPTIMIZE MBI
COST
OPTIMIZE MBI
TALENT RETENTION
HR planning
in line with
MBI strategies
Develop
personnel
abilities and
knowledge
Develop
leadership &
teamwork
Manage and access HR personnel growth
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SECOND STAGE: The second stage underlines the importance of finance as
being a small scale the MBI works on a tight budget so the optimization of
talent and cost is necessary. To ensure that there is no wastage MBI should
adopt methods for talent retention such as providing an excellent working
environment and giving the employees an opportunity to grow. New levels of
productivity should be asked without providing methods so that the
creativeness of the employees can be channeled. (Billington et al, 2007)
THIRD STAGE: The third stage is the internal process of the company, which
includes the planning of HR in line with basic strategies of the company,
development of HR personnel and a strong leadership culture. A vigorous
program of education and training should be provided to the employees, as
employees should have complete knowledge about the social media and the
advanced technologies in the market. Often, small business claim that they
are too busy to train the employees and this is a very big mistake made by
companies. (Webster et al, 2007) The marketing team should be trained in all
facets of the marketing mix and be competent to work under tight budgets.
FOURTH STAGE: Lastly it is important to access the growth and
performance of the staff. The evaluation of the staff will help the company to
decide the rewards to be given to deserving employees and also ensure that
all the employees are dedicated to give their best in the organization for the
success and growth of the company.
Thus it is advised to adopt the above-explained HR strategy to grow in the
industry. The importance of training is explained above and though the
training may be time consuming and resource intensive it can reap benefits
for the company in the long run. (Beresford and Saunders cited in Webster et
al, 2007). Consequently a strategic management approach is advised to the
company rather than just in time approach followed by MBI so that the
performance of the company can be improved. (Jennings and Beaver 1997) Having mentioned that, it is vital that the MBI continues to have a flexible
approach as well so that the opportunities are grabbed without delay and the
company does not looses any of the advantages of being a small scale
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