Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail
The case analyzes the consumer choice behavior in the case of detergents sold in an Indian retail store, Reliance Retail. The protagonist, Parul Khanna, the house brand (private label) manager at Reliance Retail wanted to know whether promotions have any short-term or long-term impact on brand switching and customer retention. Sudz, the house-brand detergent sold by Reliance Retail, was envisioned as a cost-effective detergent, giving comparable wash results as some of the established national brands such as Surf, Rin, Ariel, and so on. The questions nagging Parul were: Could customers who had been habitually purchasing a certain brand for many years really consider a house brand and make that switch? Is there a need to interfere in the market and create a "catalyst" effect? Students are expected to evaluate the impact of promotion on brand switching and brand loyalty among detergent purchasers. The case may be used in advanced statistics, stochastic process, and business analytics courses of MBA or Executive MBA programs as well as in a Ph.D. program in Statistics and Business Analytics.
Authors :: K. J. Jeeson, Avadhoot Jathar, Unnikrishnan Dinesh Kumar
Swot Analysis of "Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail" written by K. J. Jeeson, Avadhoot Jathar, Unnikrishnan Dinesh Kumar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Detergent Reliance facing as an external strategic factors. Some of the topics covered in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing energy prices, talent flight as more people leaving formal jobs, increasing commodity prices,
there is backlash against globalization, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Detergent Reliance, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Detergent Reliance 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail can be done for the following purposes –
1. Strategic planning using facts provided in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail case study
2. Improving business portfolio management of Detergent Reliance
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 Detergent Reliance
Strengths Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Detergent Reliance in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail Harvard Business Review case study are -
Highly skilled collaborators
– Detergent Reliance has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Detergent Reliance in the sector have low bargaining power. Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Detergent Reliance 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 Detergent Reliance digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Detergent Reliance 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.
Innovation driven organization
– Detergent Reliance is one of the most innovative firm in sector. Manager in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Detergent Reliance in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Detergent Reliance has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Detergent Reliance to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Detergent Reliance is present in almost all the verticals within the industry. This has provided firm in Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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.
Operational resilience
– The operational resilience strategy in the Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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.
Strong track record of project management
– Detergent Reliance is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Detergent Reliance has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Detergent Reliance has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to lead change in Sales & Marketing field
– Detergent Reliance is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Detergent Reliance in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Detergent Reliance 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 K. J. Jeeson, Avadhoot Jathar, Unnikrishnan Dinesh Kumar 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.
Weaknesses Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail are -
Lack of clear differentiation of Detergent Reliance products
– To increase the profitability and margins on the products, Detergent Reliance needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Detergent Reliance supply chain. Even after few cautionary changes mentioned in the HBR case study - Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Detergent Reliance vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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 Detergent Reliance 's lucrative customers.
Products dominated business model
– Even though Detergent Reliance 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 - Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Detergent Reliance has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Detergent Reliance even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High cash cycle compare to competitors
Detergent Reliance has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– After analyzing the HBR case study Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail, 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.
Increasing silos among functional specialists
– The organizational structure of Detergent Reliance is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Detergent Reliance needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Detergent Reliance to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail, it seems that the employees of Detergent Reliance 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.
Capital Spending Reduction
– Even during the low interest decade, Detergent Reliance has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow to strategic competitive environment developments
– As Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail HBR case study mentions - Detergent Reliance takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Opportunities Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail | 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Detergent Reliance 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.
Better consumer reach
– The expansion of the 5G network will help Detergent Reliance to increase its market reach. Detergent Reliance will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
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. Detergent Reliance can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Detergent Reliance in the consumer business. Now Detergent Reliance can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Detergent Reliance can use these opportunities to build new business models that can help the communities that Detergent Reliance operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Buying journey improvements
– Detergent Reliance can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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.
Using analytics as competitive advantage
– Detergent Reliance 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Detergent Reliance to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Detergent Reliance has opened avenues for new revenue streams for the organization in the industry. This can help Detergent Reliance to build a more holistic ecosystem as suggested in the Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail case study. Detergent Reliance can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Detergent Reliance 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, Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Detergent Reliance 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.
Developing new processes and practices
– Detergent Reliance 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.
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. Detergent Reliance 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. Detergent Reliance 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.
Leveraging digital technologies
– Detergent Reliance 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.
Threats Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail are -
Technology acceleration in Forth Industrial Revolution
– Detergent Reliance has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Detergent Reliance needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
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 Detergent Reliance.
Consumer confidence and its impact on Detergent Reliance 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.
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 Detergent Reliance business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Detergent Reliance needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Detergent Reliance can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Regulatory challenges
– Detergent Reliance 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. Detergent Reliance 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.
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 Detergent Reliance in the Sales & Marketing sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Detergent Reliance can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Detergent Reliance 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. Detergent Reliance needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing wage structure of Detergent Reliance
– 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 Detergent Reliance.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Detergent Reliance can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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 Consumer Choice between House Brands and National Brands in Detergent Purchases at Reliance Retail 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 Detergent Reliance needs to make to build a sustainable competitive advantage.
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