Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
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Case Study SWOT Analysis Solution
Case Study Description of Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry
Renzo Rosso, the president and founder of Diesel SpA, the innovative Italian casual wear company famous for its controversial 'For Successful Living' advertising campaign, is pondering how to brand its new upscale line of clothing: StyleLab. The objectives set for StyleLab are: (1) to enter the new and attractive high casual wear market; (2) to create an aura of prestige for the core D-Diesel line; and (3) to provide Diesel's designers with the opportunity to experiment with new cuts and fabrics, which may eventually trickle down to the main D-Diesel brand. Please visit the http://cases.insead.edu/diesel/ (copy and paste the url into a browser) to access Diesel's television commercials and PowerPoint presentations of all case exhibits and print advertising campaigns.
Swot Analysis of "Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry" written by Vadim Grigorian, Pierre Chandon includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Diesel Diesel's facing as an external strategic factors. Some of the topics covered in Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry casestudy better are - – increasing transportation and logistics costs, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, technology disruption, cloud computing is disrupting traditional business models, increasing energy prices,
increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Diesel Diesel's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Diesel Diesel's 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry can be done for the following purposes –
1. Strategic planning using facts provided in Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry case study
2. Improving business portfolio management of Diesel Diesel's
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 Diesel Diesel's
Strengths Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Diesel Diesel's in Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry Harvard Business Review case study are -
Ability to recruit top talent
– Diesel Diesel's is one of the leading recruiters in the industry. Managers in the Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Diesel Diesel's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Diesel Diesel's 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.
Highly skilled collaborators
– Diesel Diesel's 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Diesel Diesel's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Diesel Diesel's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Diesel Diesel's 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Diesel Diesel's 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 Vadim Grigorian, Pierre Chandon 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.
Superior customer experience
– The customer experience strategy of Diesel Diesel's 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 Diesel Diesel's 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.
Organizational Resilience of Diesel Diesel's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Diesel Diesel's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Diesel Diesel's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Diesel Diesel's is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Diesel Diesel's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Sales & Marketing field
– Diesel Diesel's 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 Diesel Diesel's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry are -
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 Diesel Diesel's supply chain. Even after few cautionary changes mentioned in the HBR case study - Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Diesel Diesel's vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Vadim Grigorian, Pierre Chandon suggests that, Diesel Diesel's 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 Diesel Diesel's is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Diesel Diesel's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Diesel Diesel's to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Diesel Diesel's 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 - Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Diesel Diesel's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Diesel Diesel's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Diesel Diesel's 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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 Diesel Diesel's has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Diesel Diesel's, firm in the HBR case study Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry, it seems that the employees of Diesel Diesel's 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.
Lack of clear differentiation of Diesel Diesel's products
– To increase the profitability and margins on the products, Diesel Diesel's needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry | 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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. Diesel Diesel's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Diesel Diesel's 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.
Building a culture of innovation
– managers at Diesel Diesel's 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.
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 Diesel Diesel's in the consumer business. Now Diesel Diesel's can target international markets with far fewer capital restrictions requirements than the existing system.
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. Diesel Diesel's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Diesel Diesel's 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.
Using analytics as competitive advantage
– Diesel Diesel's 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Diesel Diesel's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Diesel Diesel's 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.
Loyalty marketing
– Diesel Diesel's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Diesel Diesel's 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, Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Diesel Diesel's 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 Diesel Diesel's to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Diesel Diesel's can use these opportunities to build new business models that can help the communities that Diesel Diesel's operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Diesel Diesel's 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.
Threats Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry are -
High dependence on third party suppliers
– Diesel Diesel's 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.
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. Diesel Diesel's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Diesel Diesel's 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry, Diesel Diesel's 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 .
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. Diesel Diesel's needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing wage structure of Diesel Diesel's
– 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 Diesel Diesel's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Diesel Diesel's 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.
Environmental challenges
– Diesel Diesel's 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. Diesel Diesel's can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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 Diesel Diesel's.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Diesel Diesel's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
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 Diesel Diesel's business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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 Diesel for Successful Living: Branding Strategies for an Up-market Line Extension in the Fashion Industry 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 Diesel Diesel's needs to make to build a sustainable competitive advantage.
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