Design of Price and Advertising Elasticity Models SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Design of Price and Advertising Elasticity Models
The marketing mix that a manager may deploy can affect the sales of a product and can be categorized under the traditional four Ps of marketing (product, price, promotion, and placement). But the perennial question managers face concerns the combination of these different marketing mix variables that will give them maximized sales, highest share, lowest inventory, or maximized margins. Quite often, these questions are answered by historical data: for example, past sales or market share for different levels of expenditures on these marketing mix variables. In this note, we consider the design of models that allow managers to obtain robust price and advertising elasticity estimates.
Swot Analysis of "Design of Price and Advertising Elasticity Models" written by Rajkumar Venkatesan, Paul W. Farris includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Elasticity Maximized facing as an external strategic factors. Some of the topics covered in Design of Price and Advertising Elasticity Models case study are - Strategic Management Strategies, Pricing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Design of Price and Advertising Elasticity Models casestudy better are - – challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, there is backlash against globalization, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels,
increasing government debt because of Covid-19 spendings, increasing commodity prices, etc
Introduction to SWOT Analysis of Design of Price and Advertising Elasticity Models
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Design of Price and Advertising Elasticity Models case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Elasticity Maximized, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Elasticity Maximized 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 Design of Price and Advertising Elasticity Models can be done for the following purposes –
1. Strategic planning using facts provided in Design of Price and Advertising Elasticity Models case study
2. Improving business portfolio management of Elasticity Maximized
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 Elasticity Maximized
Strengths Design of Price and Advertising Elasticity Models | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Elasticity Maximized in Design of Price and Advertising Elasticity Models Harvard Business Review case study are -
Ability to lead change in Sales & Marketing field
– Elasticity Maximized 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 Elasticity Maximized in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Elasticity Maximized has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Elasticity Maximized to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Elasticity Maximized in the sector have low bargaining power. Design of Price and Advertising Elasticity Models has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Elasticity Maximized to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Elasticity Maximized is one of the most innovative firm in sector. Manager in Design of Price and Advertising Elasticity Models Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Elasticity Maximized is present in almost all the verticals within the industry. This has provided firm in Design of Price and Advertising Elasticity Models 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.
Ability to recruit top talent
– Elasticity Maximized is one of the leading recruiters in the industry. Managers in the Design of Price and Advertising Elasticity Models are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Elasticity Maximized has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Design of Price and Advertising Elasticity Models Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Successful track record of launching new products
– Elasticity Maximized has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Elasticity Maximized 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.
High switching costs
– The high switching costs that Elasticity Maximized 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.
Sustainable margins compare to other players in Sales & Marketing industry
– Design of Price and Advertising Elasticity Models firm has clearly differentiated products in the market place. This has enabled Elasticity Maximized to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Elasticity Maximized to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Elasticity Maximized 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 Design of Price and Advertising Elasticity Models HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Elasticity Maximized is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Design of Price and Advertising Elasticity Models | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Design of Price and Advertising Elasticity Models are -
Low market penetration in new markets
– Outside its home market of Elasticity Maximized, firm in the HBR case study Design of Price and Advertising Elasticity Models needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Design of Price and Advertising Elasticity Models 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 Elasticity Maximized has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Design of Price and Advertising Elasticity Models, it seems that the employees of Elasticity Maximized 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Elasticity Maximized 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Design of Price and Advertising Elasticity Models, in the dynamic environment Elasticity Maximized has struggled to respond to the nimble upstart competition. Elasticity Maximized has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Elasticity Maximized is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Design of Price and Advertising Elasticity Models can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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 Elasticity Maximized supply chain. Even after few cautionary changes mentioned in the HBR case study - Design of Price and Advertising Elasticity Models, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Elasticity Maximized vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Elasticity Maximized 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.
Increasing silos among functional specialists
– The organizational structure of Elasticity Maximized is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Elasticity Maximized needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Elasticity Maximized to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Elasticity Maximized 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 - Design of Price and Advertising Elasticity Models should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Rajkumar Venkatesan, Paul W. Farris suggests that, Elasticity Maximized 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.
Opportunities Design of Price and Advertising Elasticity Models | 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 Design of Price and Advertising Elasticity Models are -
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 Elasticity Maximized 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.
Loyalty marketing
– Elasticity Maximized 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.
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. Elasticity Maximized can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Elasticity Maximized can use these opportunities to build new business models that can help the communities that Elasticity Maximized operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Elasticity Maximized 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, Design of Price and Advertising Elasticity Models, 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 Elasticity Maximized 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 Elasticity Maximized to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Elasticity Maximized 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Elasticity Maximized can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Elasticity Maximized can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Design of Price and Advertising Elasticity Models 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Elasticity Maximized 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.
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. Elasticity Maximized can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Elasticity Maximized in the consumer business. Now Elasticity Maximized can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Elasticity Maximized 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.
Threats Design of Price and Advertising Elasticity Models External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Design of Price and Advertising Elasticity Models are -
Shortening product life cycle
– it is one of the major threat that Elasticity Maximized is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Elasticity Maximized business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Elasticity Maximized 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.
High dependence on third party suppliers
– Elasticity Maximized 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. Elasticity Maximized 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.
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. Elasticity Maximized 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 Elasticity Maximized in the Sales & Marketing sector and impact the bottomline of the organization.
Regulatory challenges
– Elasticity Maximized 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.
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. Elasticity Maximized needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Elasticity Maximized 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 Design of Price and Advertising Elasticity Models .
Consumer confidence and its impact on Elasticity Maximized 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.
Environmental challenges
– Elasticity Maximized 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. Elasticity Maximized can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Weighted SWOT Analysis of Design of Price and Advertising Elasticity Models 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 Design of Price and Advertising Elasticity Models 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 Design of Price and Advertising Elasticity Models 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 Design of Price and Advertising Elasticity Models 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 Design of Price and Advertising Elasticity Models 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 Elasticity Maximized needs to make to build a sustainable competitive advantage.
