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E-Marketing Strategic Planning Based on the SWOT and Situation Analysis of Biome - Case Study Example

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Internet marketing planning project Name of the Student: Name of the Instructor: Name of the course: Code of the course: Submission date: Executive summary Internet marketing has gained increased prominence in the recent past. This has mostly been related to its role in expediting the sales and marketing undertakings of various companies. The primary aim of this report is to develop an e-marketing plan for a small to medium sized enterprise. The case study which forms the foundation of this report is Biome which is a retail store based in Brisbane, Australia. This report undertakes a situational analysis of this company in terms of the internal and external environment, competition as well as conducts a SWOT analysis of this firm. This reports proceeds to undertake an E-marketing strategic planning whereby the young people, most predominantly women are the chief target consumers of this company. Additionally, the factors which will differentiate Biome from other competitors in Brisbane in Brisbane are also explored as well as the positioning strategies of this firm. There are also three primary objectives which are developed in this report which underpin the basic offers in the product, pricing, distribution, communication as well as the relationships strategies. This is followed by a budget and an evaluation plan which is entails measurement activities for each strategy aimed at evaluating the overall success of the identified objectives and strategies. Internet marketing planning project-a small of medium sized firm in the retail sector in Australia Table of Contents Executive summary 2 Table of Contents 3 1. Introduction 4 2. Situation analysis 5 2.1. Internal environment 6 2.2. External environment 6 2.3. Competition 7 2.4. SWOT Analysis 8 3. E-marketing strategic planning 9 3.1. Segmentation and target market 9 3.2. Differentiation 11 3.3. Positioning strategies 12 4. Objectives 13 5. E-Marketing strategies 14 5.1. Product strategies 14 5.2. Pricing strategy 15 5.3. Distribution strategy 16 5.4. Communication strategy 17 5.5. Relationships management strategy 18 6. Budget 19 7. Evaluation plan 19 Conclusion 21 References 23 1. Introduction It is an apparent fact that internet marketing has gained elevated prominence in the recent decades. This has led to elevated research into the role of this channel in the promotion of marketing activities in different quotas, best epitomized by the retail industry. According to Hart et. al. (2000, p. 954), there has been significant attention which has been focused on the commercial potential of the internet to retailers in diverse countries around the globe. This has generated several realms of confusion among the retailers. Firstly, there has been the question on what is it and what role the internet can play in retail marketing. Subsequently, diverse scholars and practitioners best epitomized by Evans (1996) as well as Van Tassel and Weitz (1997) among others have continuously asserted that the internet has the capacity of providing a new retail format which will be fundamental in taking over the traditional dominance of the fixed location stores. On the other hand, other scholars exemplified by Hezel (cited in Hart et. al., 2000, p. 954) have perceived the internet as undertaking a supporting role of the marketing activity which is already in existence. However, whatever the nature of the role which is adopted has been projected of eventually determining the demand among consumers for online shopping and thus the subsequent development of ‘cyber retailing’ (Hart et. al., 2000, p. 954). Against this backdrop, this report seeks to develop an e-marketing plan for a small to medium sized enterprise. The enterprise which has been chosen for this task is Biome which has been credited of being the ‘greenest’ retail store in Australia which has opened its Adelaide street home in the CBD of Brisbane. Much about the internal and external environment of this company will be explored in the subsequent section. 2. Situation analysis This section will explore the internal as well as the external environment of Biome. It will also investigate the competitors to this firm which will be succeeded by a concrete SWOT analysis of this company. It is however imperative to gain a brief background of this company in order to gain a comprehensive insight into its operations among other tenets. According to the Biome website (2013, p. 1), Biome as a company is primarily a family business which was founded by Tracey Bailey. This was after working in corporate communications and became cognizant of the need to part of a solution to the future problems confronting the planet. Biome instigated its operations in 2003 as an online shop which still remains a core aspect of this company even at the present time. It evolved into a physical store in Paddington (Brisbane) in June, 2005 and eventually opened the second store in September, 2007 in the central business district (CBD) of Brisbane. 2.1. Internal environment In a generic sense, this Biome can be perceived to be a retail firm which provides a wide alley of eco-friendly products. In this regard, this company has been credited for supporting the best eco-innovations as well as sustainable style. This store is thus leading other retail stores in the reduction of their impact on the planet (Biome website, 2013, p. 1). In regard to what this store does and the products/services which are provided at Biome, this company is extensively engaged in the production and distribution of a wide alley of eco-friendly products ranging from recycled tyre floor to gas ceiling lights. In this case, materials which are known to contain solvents, glycols, polyurethane, volatile organic compounds as well as heavy metals are avoided. This latter approach is geared towards the minimization of off-gassing of toxic fumes in the advancement to the future (Biome website, 2013, p. 1). As mentioned in the preceding section, the case study company is established in two primary locations namely Paddington (Brisbane) as well as in the Brisbane’s CBD. 2.2. External environment There are several external factors which impact on Biome and its business. Firstly, there is the aspect of sourcing for the products retailed at Biome. According to Biome website (2013, p. 1), this company primarily chooses products which are manufactured in Australia whenever this is plausible. This is basically aimed at supporting the local businesses in Australia both in the short and long-term. Nonetheless, despite the fact that the local products are important in saving resources tied to the transportation at the company, there arises a situation whereby some of the products are not simply available in Australia which obliges Biome to choose and sources products which are manufactured from oversees. This is one major external factor which not only impacts on the Biome as a company in terms of the logistics of sourcing products from other countries, but also impacts on the prices of these products when they reach the Australian market due to the high costs associated with the importation of these products. The other external factor is the influence from external stakeholders, for instance, the environmental groups which play a key role in defending the environment. Based on the fact that these collectives engage in monitoring which decisions are being made as well as lobbying for changes in laws and policies affecting the environment in Australia (Australian Conservation Foundation, 2007, p. 69), some of the laws and policies which are adopted after the aforementioned process have far reaching impacts on the operations of Biome, either positively or negative. The last external factor is competition. This is explored in the subsequent section. 2.3. Competition Just like in any other business, Biome is confronted by competition from other companies which retail in similar products. This is best epitomized in the production of stainless steel bottles whereby a company like Cheeki has been rated as the leading brand of stainless steel lifestyle products in Australia. This company manufactures water bottles, shakers, coffee mugs, insulated bottles and baby bottles among others products which are produced at Biome. Additionally, there are other products in the same category made in other regions of the world which include Blue Q (USA), Sigg and Earthlust (China) among others (Greennii, 2011, p. 1). Additionally, Biome also faces competition both within and outside Australia in the production of other products ranging from natural skin care to bed linen. 2.4. SWOT Analysis SWOT analysis can be perceived as the process through which decision makers in any given firm gradually develop their awareness of the organizational environments with the sole goal of influencing the performance in the present and in the future (Naryanan & Nath, 1993, p. 197). Al-Rousan and Qawasme (2009, 1) determined that an explicit relationship exists between dimensions of competitive advantage and SWOT (Strength, Weakness, Opportunity and Threat) analysis. In regard to the strengths, Biome has an already established market share and has a robust reputation of high quality products among its consumers both in Paddington (Brisbane) as well as in Brisbane CBD. This reputation is bound to spill over to the new venture and all the promotional strategy will focus more on profound efforts towards consumer satisfaction rather than as a response to heightened competition in the industry. Nonetheless, the firm is confronted by a major weakness in regard to its sole establishment only the above localities in Australia. In this case, it is confronted with the challenge of being confined in one region and probable consumers in other Australian regions might not even be cognizant of its existence. However, Biome has the ability of converting the above weakness into an opportunity through diversifying into other untapped regions which will significantly impact on its market share. Additionally, there are other opportunities if the company expands its portfolio through promotion of innovation and creativity in the manufacture of eco-friendly products which are not currently being produced by its competitors both locally and internationally. On the other hand, Biome can effectively use internet marketing in reaching its regional consumers, a fact which is supported by Hou and Rego (2002, p. 9) who determined that one of the type of companies which is bound to benefit from internet marketing is the class of retailers who have a high reputation, provide high quality goods, distinct merchandise and have only regional penetration. Lastly, this venture is under constant threat of competition from other local companies offering similar services like those mentioned in the preceding section. Moreover, continued entry of international firms offering similar or alternative products in the Australian market also provides a major threat to the future viability of Biome’s operations. 3. E-marketing strategic planning 3.1. Segmentation and target market In regard to the demographics, the products from Biome are primarily consumed by young consumers, for instance, the organic skin care, natural body and soaps, natural hair care, natural skin care and mineral makeups among others. In terms of gender, these products are extensively consumed by women who are in need of natural and organic skin care products. Nonetheless, there is still as small segment of men in Biome’s target market with products like natural skin men products. Additionally, the fact of women forming the largest chunk of Biome’s target market is also epitomized with the availability of baby products like green school supplies, organic baby, educational toys and baby bottles among others. With early researches on commercial use of the internet showing continued revelation of gender differentiation in internet utility which was male dominated, recent studies have revealed over half of the e-shoppers are now female and that women are currently outspending men online (Jayawardhena, et. al., 2007, p. 5). This serves a great opportunity for Biome in formulating and implementing internet marketing plans which will be popular among the women who form the largest share of Biome’s target consumers. In regard to the psychographics, this target market can be perceived to impose a high value and opinion on fashion and taste. In this case, they are bound to purchase particular products like natural hair care and babies’ products like green school supplies if at all these products represent a high quality and fashion. Moreover, members of this target market have extensive interests and hobbies founded in outdoor activities like sports, camping and travelling which influences their demand for products like lunch boxes, reusable cups and bags, water and insulated bottles among other products from Biome. In regard to the geographical location and behavior, the target market is predominantly urban and majority of the products produced at Biome are bound to be used by consumers in the metropolitan areas. Additionally, these target consumers in the urban areas are bound to exhibit high consumption of online/internet marketing as opposed to the rural areas and the location of Biome in Paddington (Brisbane) and Brisbane CBD which are primarily urban is bound to have a positive impact in the consumption of internet marketing. 3.2. Differentiation There are several factors which will make Biome to be different from other competitors in Brisbane. Firstly, Biome is conveniently located at the heart of CBD in Brisbane and thus it is highly convenient to the locals of this place who may wish to visit its store. This is unlike other competitors like Body Sync which is located at Tarragindi on the inner south side of Brisbane and might be inconvenient for majority of consumers wishing to shop at Brisbane CBD. Thus, target consumers in Brisbane CBD engaging in internet marketing will be assured of convenience in the delivery of their services, mostly those preferring fast delivery. In addition, Biome offers a wide alley of eco-friendly products which differentiates this company from other competitors in the manufacture of body and hair care products. This is founded on the fact that most of the competitors in the production of this products use materials which are known to have solvents, glycols, polyurethane, volatile organic compounds which are presently being rejected by consumers and confronted by extensive criticism from environmental groups. In this case, consumers who will be purchasing their products online are bound to be sensitive about the components of various products which really places Biome in a strategic niche in the market. In regard to competitive advantage, Biome has an already established a strong reputation of eco-friendly and high quality products among its consumers both in Paddington (Brisbane) as well as in Brisbane CBD. This gives it a major competitive advantage among the consumers in the Brisbane market even with the increased number of new entrants in this locality. In addition, its unique locality in the CBD of Brisbane offers Biome a unique competitive advantage in regard to positioning based on its efficient accessibility from consumers. 3.3. Positioning strategies As earlier mentioned, Biome is strategically located at Paddington (Brisbane) as well as in Brisbane CBD. Subsequently, the internet marketing strategy will seek to fortify this metropolitan location aimed at creating a larger appeal to the target consumers in the metropolitan locations of Brisbane. This is in terms of being positioned as a convenient store when juxtaposed with other competitors in the region which will be integral in making it attractive to the target consumers in the region. In addition, the Biome products which are characterized by high quality and being eco-friendly will be positioned as being ideal in satisfying the distinct needs of various target consumers in the market. In this case, the Biome brand will be appealing to the internet shoppers who wish to purchase certain products from this store in Brisbane unlike other products from the competitors which might comprise some harmful ingredients unpleasant to the target consumers in this region. Lastly, Biome as a company will be positioned as a company which has a strong past reputation of producing high quality products which efficiently meet the needs of various consumers and this will be imperative even in the future while launching other products from this company. 4. Objectives There are several e-marketing objectives based on the preceding situation analysis and strategic planning strategies to be accomplished within 12 months to 2 years. However, this section will primarily major on three of them. The first objective is to increase the presence of Biome in the internet, mostly through the creation of a corporate website primarily targeting online shoppers which is aimed at increasing the sales of Biome over the internet. In addition, there will be deliberate efforts to increase the presence of Biome in the social networks which has received increased popularity in online marketing in the recent past. This latter fact is revealed by Weston (cited in Bolotaeva & Cata, 2011, p. 2) who determined that if social networking is correctly approached in business, it can be integral in facilitating the processes of finding talent and new consumers, developing brand awareness as well as conducting market research and brand intelligence. This aspect of increasing the presence of Biome in the internet and subsequent sales revenues will be accomplished within 12 months. The second objective is to develop and fortify the delivery and distribution channels. This is founded on the backdrop that there is need for online shoppers to be confident that the products they purchase will be delivered in good time and at a reasonable cost. This will involve getting new distribution outlets around Brisbane and recruitment of delivery personnel among other logistics and this objective will be accomplished within 2 years. The third and final objective is to institute a strong monitoring and evaluation mechanism (M&E) to assess the viability of online shopping at Biome as well as to provide an ideal platform for continuous improvement of service delivery. This will be supplemented by a feedback mechanism to get an idea about the feeling of consumers who have engaged in online shopping. This will also be fundamental in enhancing the quality of service delivery in internet marketing by the company and will be accomplished within one and a half years. 5. E-Marketing strategies This section will entail rudimentary offers in terms of product, pricing, distribution, communication as well as relationship management strategies based on the objectives outlined in the preceding section. 5.1. Product strategies In this case, the internet marketing will aim at providing diverse products to the target consumers. As a result, the products will be presented in different quantities aimed at capturing the needs of various consumers in the market. In this case, the basic product strategy will be founded on availing a wide alley of products to the consumers. Additionally, the consumers will get gift hampers after making their purchases online which will tend to promote online shopping in this company and the first objective in mentioned above. Another product strategy will be founded on offering complementary products to consumers who purchase a particular product. This is best epitomized whereby in case a parent purchases school stationery for her kid through the internet, then a free educational toy can be offered to this parent to assist the kid in his/her learning processes. This will be fundamental in influencing the parent to purchase the educational toys in the future based on their importance in enhancing the learning experience of the kid. On the other hand, the products will have different offers in terms of the quantity that specific consumers purchase from the online store. This is best epitomized whereby in case a consumer purchases a large quantity of natural body and soaps, this consumer will be entitled to free delivery to his/her destination. This product strategy will be integral in ensuring that the consumers purchase large amounts of products from the online store which will guarantee free delivery and expedite the achievement of the first objective. 5.2. Pricing strategy Pricing can be perceived to be derived from price which refers to how much a business charges for its goods or services (Ehmke et al., 2010, p. 2). Thus, pricing can be perceived as the act of setting the right price for the products from a particular firm. Understanding pricing is imperative for Biome when it’s selling a chosen product category based on the fact that it helps in comprehending how much the consumers are willing to pay for a particular product category based on its quality as well as the prices from other service providers. In this case, Biome will offer different offers in its pricing strategy in order to encourage the consumers to purchase more. The first pricing offer will promotional and will be founded on quantity discounts. In this case, if a particular consumer purchases a large amount of products from the Biome online store, then he/she will be entitled to a 5% discount from the total cost of the products. Another strategy aimed at promoting online shopping will be to price the products in online store slightly lower than the prices at the physical outlets. In this case, the consumers will be extensively encouraged to do their shopping online as opposed to visiting the physical stores in different outlets and will be key in promoting the achievement of the first objective detailed in the preceding section. The last pricing strategy will be to offer the distributers in different distribution outlets substantial commissions on the amount of products that they deliver to the consumers. In this case, the prices set for the distributers will incorporate a considerable profit on their end coupled with a cumulative bonus on the cumulative total of products which they deliver to the consumers. This will not only be key in enhancing the performance of the distributors but will also support the achievement of the second objective outlined in the preceding section. 5.3. Distribution strategy Coupled with the above tenet, Biome will seek to expand their distribution capacity through identification of strategic distribution outlets for their products. In this case, the distributors will be offered free promotional materials and packages aimed at enhancing their activities like sensitizing the consumers about the availability of the products. In addition, the distributors will be offered relevant free samples of products like reusable bags, bathroom cleaning products and kitchen cleaning products among others. This will motivate them in the promotion of their distribution outlets which will be key in supporting the achievement of objective two outlined in the preceding section. On the other hand, the distributors will be offered free training on how to use various products. This will be instrumental in ensuring that they are conversant with the usage of various products from Biome and they will be in a position to transfer this knowledge and skills to the consumers. Moreover, the distributors will also be offered a training package on operating the online marketing database for them to ascertain which orders are supposed to be delivered at what place and at what time. The provision of both of these offers will be fundamental in supporting the achievement of the first and the second objective respectively. 5.4. Communication strategy This will entail communication with both the consumers and the distributors. With the consumers, Biome will provide a toll free communication channel to enquire about the availability of particular products as well as the progress of their delivery to the destinations of their choice. In addition, this free channel will be integral in getting the feedback from the consumers about a particular product which will be core in supporting the fulfillment of the third objective. In regard to the communication strategy with the distributors, the basic offer will entail rewarding the distributors based on the positive communication from the consumers about the efficiency of their delivery mechanisms. In this case, Biome will engage in constant communication with the distributors about their progress and proceed to reward their performance based on the feedback from the consumers which will be captured in the online marketing database. This will be integral in facilitating the attainment of the third objective as detailed in the preceding section. 5.5. Relationships management strategy One of the basic offers in relationship management will be offering loyal consumers with various gifts from the company aimed at rewarding their continued support in Biome events as well as following the company in the social networks. This is against the backdrop of the increased prominence of the social media in enhancing consumer relationship which has impacted on the performance of different companies through informing operations like sales and marketing. This fact is supported by Assaad and Gomez (2011, p. 13) who cited that the extension of Web 2.0 and social network best epitomized by Facebook and Twitter has greatly impacted on the way different companies in diverse industries undertake their marketing operations. This will be paramount in supporting the achievement of the first objective as outlined in the previous section. Another strategy management strategy will be to hold different competition activities whereby the winners of these competitions will be rewarded. In this case, the consumers will be encouraged to participate in various events as well as follow the events of Biome online which will support the attainment of the first objective. 6. Budget The following table shows the forecast of the potential costs of implementing the key objectives (with total budgetary allocation being $6000 per annum). Activity AUS$ Web development (corporate) 500 Web hosting 100 per annum Marketing via distributors 4000 Discounts and gifts 1000 Administrative cost 300 Other costs 100 Total expenses 6000 7. Evaluation plan This is the last section which entails the measurement activities for each strategy aimed at evaluating the overall success of the identified objectives and strategies. In regard to the product strategy, Biome will engage in a monitoring and evaluation activity aimed at assessing the performance of various products in the market. In the case of monitoring, this will be done on a quarterly basis whereby Biome will monitor the performance of each product as well as the impact of various product offers, for instance, offer of complementary products like free educational toy in elevating the sales of school stationery for kids among the consumers among online shoppers. This will be followed by annual evaluation of the total performance of each product with specific offers against past performance without the present offers and will be key in assessing the achievement of the first and third objectives. In regard to the pricing strategy, an evaluation mechanism will be primed at Biome to assess the impact of discounts and price reduction for products purchased online. This will be key in assessing whether the discounts had the desired impacts on increasing the sales of the discounted products both at the physical stores as well as over the internet. In addition, this evaluation mechanism will assess the performance of the Biome products in the market based on their prices against those of other competitors who retail their products either online or in physical stores. This evaluation activity will be done annually to assess whether the first objective of increasing online sales has been achieved. In addition, an evaluation system will be put in place to assess the impact of the training of the distributors as outlined in the distribution strategy. In this case, evaluation will be done at the end of the training program. Several tools are often put into utility while conducting this M&E process. These include but not limited to sample output and effect indicators, monthly statistical reports, client feedback form and incident report form/consent for release of information. All these are aimed at assessing whether the training program culminated in skills, knowledge or any affective in the trainees (Aguinis & Kraiger, 2002, p. 453). This will be critical in assessing whether the second objective has been achieved. In regard to the communication strategy, there will be a periodic evaluation of the number of calls that the consumers make to the company enquiring about various products or reporting any incidents in the delivery system. In addition, the evaluation process will assess whether the consumer service personnel were able to address the issues raised by the consumers and whether the consumers were satisfied at the end of the transaction. Moreover, this evaluation mechanism will assess the response of the consumers about the performance of specific distributors which will form the basis of developing a reward framework to give bonuses to the best rated distributors. This will be integral in assessing whether the second and third objectives have been achieved. Lastly, there will be an evaluation framework primed at Biome to assess the relationship strategy. This is in regard to the evaluation of the total participants in any given competition or event undertaken by Biome as well as assessing the number of individuals and collectives who are following this company in the social platforms. This will be integral in gaining estimates about the prospective consumers who have been acquired. This is against the realization by Milovic (2012, p. 26) that the modern day global competition among different companies obliges these firms to engage in practically everything which can be instrumental in reaching new consumers and more imperatively, retaining the profitable and loyal consumers. Conclusion The above analysis has evidenced the importance of internet marketing in the contemporary times. Additionally, it has undertaken a situation analysis of Biome which is the case study institution in terms of the internal and external environment, competition as well as the SWOT analysis. On the other hand, this analysis has engaged in E-marketing strategic planning as well as developed three basic objectives based on the situation analysis as well as the strategic planning strategies. In addition to the e-marketing strategies, this analysis has developed a budget to facilitate the implementation of this plan for a period between 12 months and 2 years. Lastly, this analysis has outlined an evaluation plan which entailed measurement activities for each strategy aimed at evaluating the overall success of the identified objectives and strategies. References Aguinis, H. & Kraiger, K., 2002, ‘Benefits of Training and Development for Individuals and Teams, Organizations, and Society’, The Annual Review of Psychology, Vol. 60, pp. 451–74. Al-Rousan, M. & Qawasme, F 2009, ‘The Impact of SWOT Analysis on Achieving a Competitive Advantage: Evidence from Jordanian Banking Industry’, International Bulletin of Business Administration, vol. 243, no. 6, pp. 82-92. Assaad, W., & Gomez, JM., 2011, ‘Social Network in marketing (Social Media Marketing): Opportunities and Risks’, International Journal of Managing Public Sector Information and Communication Technologies, Vol. 2, No. 1, pp. 13-22. Australian Conservation Foundation, 2007, The Green Home Guide, ACF, Brisbane. Biome website, 2013, ‘Biome’, retrieved 11th May 2013, < http://www.biome.com.au>. Bolotaeva, V. & Cata, T., 2011, ‘Marketing Opportunities with Social Networks’, Journal of Internet Social Networking and Virtual Communities, Vol. 1, pp. 1-8. Ehmke, C., Fulton, J & Lusk, J., 2010, ‘Marketing’s Four P’s: First Steps for New Entrepreneurs’, retrieved 11th May 2013, < http://www.ces.purdue.edu/extmedia/ec/ec-730.pdf>. Evans, D., 1996, ‘The merchants in Venice’, Computer Weekly, 9th May, p. 34. Greennii, 2011, ‘Which Reusable Water Bottle Is Best?’, retrieved 11th May 2013, < http://www.care2.com/greenliving/which-reusable-water-bottle-is-best.html>. Hart, C. et. al. 2000, ‘Retailer adoption of the Internet Implications for retail marketing’, European Journal of Marketing, Vol. 34 No. 8, pp. 954-974. Hou, J. & Rego, C., 2002, ‘Internet Marketing: An Overview’, retrieved 11th May 2013, < http://faculty.bus.olemiss.edu/crego/papers/hces0802.pdf>. Jayawardhena, C. et. al., 2007, ‘Consumers online: Intentions, orientations and segmentation’, International Journal of Retail and Distribution Management, Vol. 35, No. 6, pp. 515-599. Milovic, B., 2012, ‘Social Media and eCRM as a Prerequisite for Hotel Success’, Management Information Systems, Vol. 7, No. 3, pp. 26-31. Naryanan, VK., & Nath, R., 1993, Organization Theory: Strategic Approach, Irwin INC, USA. Van Tassel, S. & Weitz, BA., 1997, ‘Interactive home shopping: all the comforts of home’, Direct Marketing, Vol. 59, No. 10, p. 40. Read More
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