European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering

The European Bank for Reconstruction and Development, the first supranational financial institution of the post-Cold War era, is planning its debut in the international capital markets through a bond issuance of $500 million. The bank must determine its marketing strategy for the offering on two levels--positioning of the institution and of the bond offering itself. Integral to the marketing task is the selection of a lead manager, who will determine the marketing mix. The mix decisions involve determining product (currency, maturity, coupon), pricing (yield), promotion (road shows and media relations), and distribution (formation of the syndicate). In addition, the lead manager will need to select appropriate target markets (retail and institutional investors), along with overall positioning for the institution.

Authors :: Jeffrey Rayport

Topics :: Sales & Marketing

Tags :: International business, Marketing, Pricing, Social enterprise, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering" written by Jeffrey Rayport includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bond Reconstruction facing as an external strategic factors. Some of the topics covered in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering case study are - Strategic Management Strategies, International business, Marketing, Pricing, Social enterprise and Sales & Marketing.

Some of the macro environment factors that can be used to understand the European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, geopolitical disruptions, increasing government debt because of Covid-19 spendings, technology disruption, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc

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Introduction to SWOT Analysis of European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bond Reconstruction, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bond Reconstruction operates in.

According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering can be done for the following purposes –
1. Strategic planning using facts provided in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering case study
2. Improving business portfolio management of Bond Reconstruction
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bond Reconstruction

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Strengths European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Bond Reconstruction in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering Harvard Business Review case study are -

Superior customer experience

– The customer experience strategy of Bond Reconstruction in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Strong track record of project management

– Bond Reconstruction is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Sustainable margins compare to other players in Sales & Marketing industry

– European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering firm has clearly differentiated products in the market place. This has enabled Bond Reconstruction to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Bond Reconstruction to invest into research and development (R&D) and innovation.

Training and development

– Bond Reconstruction has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.

Ability to recruit top talent

– Bond Reconstruction is one of the leading recruiters in the industry. Managers in the European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

Low bargaining power of suppliers

– Suppliers of Bond Reconstruction in the sector have low bargaining power. European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bond Reconstruction to manage not only supply disruptions but also source products at highly competitive prices.

Digital Transformation in Sales & Marketing segment

- digital transformation varies from industry to industry. For Bond Reconstruction digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bond Reconstruction has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.

Diverse revenue streams

– Bond Reconstruction is present in almost all the verticals within the industry. This has provided firm in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.

Cross disciplinary teams

– Horizontal connected teams at the Bond Reconstruction are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.

Innovation driven organization

– Bond Reconstruction is one of the most innovative firm in sector. Manager in European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Operational resilience

– The operational resilience strategy in the European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.

Analytics focus

– Bond Reconstruction is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Jeffrey Rayport can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

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Weaknesses European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering are -

Products dominated business model

– Even though Bond Reconstruction has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering should strive to include more intangible value offerings along with its core products and services.

Skills based hiring

– The stress on hiring functional specialists at Bond Reconstruction has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.

High bargaining power of channel partners

– Because of the regulatory requirements, Jeffrey Rayport suggests that, Bond Reconstruction is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.

Interest costs

– Compare to the competition, Bond Reconstruction has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.

Workers concerns about automation

– As automation is fast increasing in the segment, Bond Reconstruction needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bond Reconstruction is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

Aligning sales with marketing

– It come across in the case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering can leverage the sales team experience to cultivate customer relationships as Bond Reconstruction is planning to shift buying processes online.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering, it seems that the employees of Bond Reconstruction don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

Low market penetration in new markets

– Outside its home market of Bond Reconstruction, firm in the HBR case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering, in the dynamic environment Bond Reconstruction has struggled to respond to the nimble upstart competition. Bond Reconstruction has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

High operating costs

– Compare to the competitors, firm in the HBR case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Bond Reconstruction 's lucrative customers.

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Opportunities European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities highlighted in the Harvard Business Review case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering are -

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bond Reconstruction can use these opportunities to build new business models that can help the communities that Bond Reconstruction operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Bond Reconstruction can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Use of Bitcoin and other crypto currencies for transactions

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Bond Reconstruction in the consumer business. Now Bond Reconstruction can target international markets with far fewer capital restrictions requirements than the existing system.

Creating value in data economy

– The success of analytics program of Bond Reconstruction has opened avenues for new revenue streams for the organization in the industry. This can help Bond Reconstruction to build a more holistic ecosystem as suggested in the European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering case study. Bond Reconstruction can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Reconfiguring business model

– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Bond Reconstruction to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Bond Reconstruction can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Bond Reconstruction in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.

Identify volunteer opportunities

– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Bond Reconstruction can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Buying journey improvements

– Bond Reconstruction can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.

Loyalty marketing

– Bond Reconstruction has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.

Manufacturing automation

– Bond Reconstruction can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bond Reconstruction to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Bond Reconstruction to hire the very best people irrespective of their geographical location.

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Bond Reconstruction can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Bond Reconstruction can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.

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Threats European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering are -

Aging population

– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.

Regulatory challenges

– Bond Reconstruction needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.

Instability in the European markets

– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Bond Reconstruction will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.

High dependence on third party suppliers

– Bond Reconstruction high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.

Shortening product life cycle

– it is one of the major threat that Bond Reconstruction is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering, Bond Reconstruction may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .

New competition

– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bond Reconstruction in the Sales & Marketing sector and impact the bottomline of the organization.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Bond Reconstruction.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Bond Reconstruction in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bond Reconstruction with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

High level of anxiety and lack of motivation

– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Bond Reconstruction needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.

Backlash against dominant players

– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Bond Reconstruction business can come under increasing regulations regarding data privacy, data security, etc.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Bond Reconstruction can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering .

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Weighted SWOT Analysis of European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants. We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –

First stage for doing weighted SWOT analysis of the case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.

Second stage for conducting weighted SWOT analysis of the Harvard case study European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.

Third stage of constructing weighted SWOT analysis of European Bank for Reconstruction and Development: Marketing Strategy for the Debut Bond Offering is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Bond Reconstruction needs to make to build a sustainable competitive advantage.

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