Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products
The Namaste case is a story of how Kellogg alumni couple Gary and Denise Gardner grow their Namaste-branded hair care line from production at the family's kitchen table into a formidable $80 million empire within a 14-year period. The Gardners come from a longtime hair care business lineage, the Soft Sheen dynasty, started by Gary's father decades earlier. Soft Sheen was ultimately sold to hair care giant L'Oreal for over $100 million. The Gardners claim Namaste's growth occurred through listening to the needs and desires of customers for healing hair care products that reminded them of nourishing household remedies. The hair care line became a leader in its industry but faced the dilemma of how to expand sales in new markets, especially international markets such as South Africa and Nigeria.
Swot Analysis of "Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products" written by Cheryl Mayberry-McKissack, Tracey Robinson-English includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hair Namaste facing as an external strategic factors. Some of the topics covered in Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products case study are - Strategic Management Strategies, Race, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google,
increasing commodity prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hair Namaste, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hair Namaste 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.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products can be done for the following purposes –
1. Strategic planning using facts provided in Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products case study
2. Improving business portfolio management of Hair Namaste
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 Hair Namaste
Strengths Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hair Namaste in Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products Harvard Business Review case study are -
Ability to recruit top talent
– Hair Namaste is one of the leading recruiters in the industry. Managers in the Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Hair Namaste is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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.
Organizational Resilience of Hair Namaste
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hair Namaste does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Hair Namaste has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hair Namaste to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Sales & Marketing industry
– Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products firm has clearly differentiated products in the market place. This has enabled Hair Namaste to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Hair Namaste to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Hair Namaste has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Hair Namaste digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hair Namaste 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
– Hair Namaste is present in almost all the verticals within the industry. This has provided firm in Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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 Hair Namaste 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.
Superior customer experience
– The customer experience strategy of Hair Namaste in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Hair Namaste has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Hair Namaste has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Cheryl Mayberry-McKissack, Tracey Robinson-English suggests that, Hair Namaste 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.
Increasing silos among functional specialists
– The organizational structure of Hair Namaste is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Hair Namaste needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hair Namaste to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products, in the dynamic environment Hair Namaste has struggled to respond to the nimble upstart competition. Hair Namaste has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Low market penetration in new markets
– Outside its home market of Hair Namaste, firm in the HBR case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Hair Namaste 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products, it seems that the employees of Hair Namaste 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.
Need for greater diversity
– Hair Namaste has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Lack of clear differentiation of Hair Namaste products
– To increase the profitability and margins on the products, Hair Namaste needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Hair Namaste 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 - Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products should strive to include more intangible value offerings along with its core products and services.
Opportunities Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products | 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 Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Hair Namaste can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Hair Namaste can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
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 Hair Namaste 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.
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 Hair Namaste in the consumer business. Now Hair Namaste can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Hair Namaste can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Creating value in data economy
– The success of analytics program of Hair Namaste has opened avenues for new revenue streams for the organization in the industry. This can help Hair Namaste to build a more holistic ecosystem as suggested in the Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products case study. Hair Namaste can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Hair Namaste can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hair Namaste can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hair Namaste 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 Hair Namaste 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. Hair Namaste 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. Hair Namaste 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.
Using analytics as competitive advantage
– Hair Namaste has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hair Namaste to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Hair Namaste can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hair Namaste 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, Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products, Hair Namaste 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 .
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 Hair Namaste business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hair Namaste 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. Hair Namaste needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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 Hair Namaste in the Sales & Marketing sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hair Namaste 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 Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products .
Consumer confidence and its impact on Hair Namaste demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
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. Hair Namaste 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
– Hair Namaste 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.
Regulatory challenges
– Hair Namaste 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.
Shortening product life cycle
– it is one of the major threat that Hair Namaste is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Increasing wage structure of Hair Namaste
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Hair Namaste.
Weighted SWOT Analysis of Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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 Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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 Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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 Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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 Entrepreneurial Sales Strategies: Namaste Laboratories Pursues New Markets for Hair Care Products 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 Hair Namaste needs to make to build a sustainable competitive advantage.
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