Case Study Description of Search Engine Marketing (SEM)
Search engines are shop windows, giving visibility to our products and promoting our company. Not to make good use of them is to miss an opportunity to build brand and sales.When a user conducts a search, the search engine displays the results it considers most relevant. On the one hand, it displays "organic" or "natural" results. These appear in the middle of the results page and are not paid for by the company. SEO techniques are used to optimize this kind of result. On the other hand, it displays paid results. Also known as sponsored links, these consist of text advertisements shown at the top of the results page. To optimize this kind of result we use SEM techniques.In this technical note we shall focus on sponsored links and how we can use them to achieve our business objectives.
Authors :: Luis Ferrandiz, Rosa Fernandez-Alonso, Julian Villanueva
Swot Analysis of "Search Engine Marketing (SEM)" written by Luis Ferrandiz, Rosa Fernandez-Alonso, Julian Villanueva includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Displays Sem facing as an external strategic factors. Some of the topics covered in Search Engine Marketing (SEM) case study are - Strategic Management Strategies, Internet, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Search Engine Marketing (SEM) casestudy better are - – there is backlash against globalization, increasing energy prices, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, wage bills are increasing,
technology disruption, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Search Engine Marketing (SEM)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Search Engine Marketing (SEM) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Displays Sem, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Displays Sem 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 Search Engine Marketing (SEM) can be done for the following purposes –
1. Strategic planning using facts provided in Search Engine Marketing (SEM) case study
2. Improving business portfolio management of Displays Sem
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 Displays Sem
Strengths Search Engine Marketing (SEM) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Displays Sem in Search Engine Marketing (SEM) Harvard Business Review case study are -
Effective Research and Development (R&D)
– Displays Sem 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 Search Engine Marketing (SEM) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Displays Sem is one of the leading recruiters in the industry. Managers in the Search Engine Marketing (SEM) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Displays Sem digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Displays Sem 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
– Displays Sem is present in almost all the verticals within the industry. This has provided firm in Search Engine Marketing (SEM) 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.
Analytics focus
– Displays Sem 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 Luis Ferrandiz, Rosa Fernandez-Alonso, Julian Villanueva 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.
Organizational Resilience of Displays Sem
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Displays Sem does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Displays Sem in the sector have low bargaining power. Search Engine Marketing (SEM) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Displays Sem to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Sales & Marketing field
– Displays Sem 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 Displays Sem in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Displays Sem in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Displays Sem 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 Search Engine Marketing (SEM) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Sales & Marketing industry
– Search Engine Marketing (SEM) firm has clearly differentiated products in the market place. This has enabled Displays Sem to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Displays Sem to invest into research and development (R&D) and innovation.
Innovation driven organization
– Displays Sem is one of the most innovative firm in sector. Manager in Search Engine Marketing (SEM) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Search Engine Marketing (SEM) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Search Engine Marketing (SEM) are -
High operating costs
– Compare to the competitors, firm in the HBR case study Search Engine Marketing (SEM) 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 Displays Sem 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Displays Sem is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Displays Sem needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Displays Sem to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Displays Sem 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. Displays Sem 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.
Capital Spending Reduction
– Even during the low interest decade, Displays Sem 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.
Products dominated business model
– Even though Displays Sem 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 - Search Engine Marketing (SEM) should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Displays Sem 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Search Engine Marketing (SEM), is just above the industry average. Displays Sem needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Search Engine Marketing (SEM), in the dynamic environment Displays Sem has struggled to respond to the nimble upstart competition. Displays Sem has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Search Engine Marketing (SEM) 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 Search Engine Marketing (SEM) can leverage the sales team experience to cultivate customer relationships as Displays Sem is planning to shift buying processes online.
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 Displays Sem supply chain. Even after few cautionary changes mentioned in the HBR case study - Search Engine Marketing (SEM), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Displays Sem vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study Search Engine Marketing (SEM), 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.
Opportunities Search Engine Marketing (SEM) | 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 Search Engine Marketing (SEM) are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Displays Sem can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Displays Sem 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.
Learning at scale
– Online learning technologies has now opened space for Displays Sem to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
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 Displays Sem in the consumer business. Now Displays Sem can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Displays Sem 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, Search Engine Marketing (SEM), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Displays Sem has opened avenues for new revenue streams for the organization in the industry. This can help Displays Sem to build a more holistic ecosystem as suggested in the Search Engine Marketing (SEM) case study. Displays Sem can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Displays Sem to increase its market reach. Displays Sem 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.
Buying journey improvements
– Displays Sem can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Search Engine Marketing (SEM) 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.
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. Displays Sem can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Displays Sem 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 Displays Sem to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Displays Sem is facing challenges because of the dominance of functional experts in the organization. Search Engine Marketing (SEM) case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Displays Sem 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Displays Sem 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.
Threats Search Engine Marketing (SEM) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Search Engine Marketing (SEM) are -
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. Displays Sem 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.
Increasing wage structure of Displays Sem
– 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 Displays Sem.
Shortening product life cycle
– it is one of the major threat that Displays Sem is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Displays Sem 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.
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 Displays Sem 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 Displays Sem.
High dependence on third party suppliers
– Displays Sem 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.
Stagnating economy with rate increase
– Displays Sem 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.
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. Displays Sem can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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 Displays Sem business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Displays Sem has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Displays Sem 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Search Engine Marketing (SEM), Displays Sem 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 .
Weighted SWOT Analysis of Search Engine Marketing (SEM) 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 Search Engine Marketing (SEM) 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 Search Engine Marketing (SEM) 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 Search Engine Marketing (SEM) 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 Search Engine Marketing (SEM) 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 Displays Sem needs to make to build a sustainable competitive advantage.