The Changed Legality of Resale Price Maintenance and Pricing Implications SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Changed Legality of Resale Price Maintenance and Pricing Implications
From 1911 until 2007, minimum resale price maintenance agreements between manufacturers and resellers were illegal under federal antitrust law. This handicapped manufacturers which sought to exert control over how their products were priced and promoted through the distribution channel. In June 2007, the United States Supreme Court-via the Leegin case-ruled that bilateral minimum resale price maintenance agreements would no longer be automatically illegal. Rather, they would be legal if their net impact is pro-competitive, and illegal only if the net impact is anti-competitive. This ruling empowers manufacturers to use resale price maintenance to create value for their customers and consumers. However, not all stakeholders-including some state legal systems-have embraced the Leegin ruling, thereby creating uncertainty regarding its final impact. Despite this uncertainty, the opportunities created by Leegin are worth exploring and acting upon. Since the Leegin ruling 3 years ago, a new landscape for resale pricing maintenance has been evolving. We discuss this landscape and the considerations for using resale price maintenance within its ambit. For many manufacturers, the chance of benefitting from Leegin outweighs any potential risks.
Swot Analysis of "The Changed Legality of Resale Price Maintenance and Pricing Implications" written by Surinder Tikoo, Bruce Mather includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Leegin Resale facing as an external strategic factors. Some of the topics covered in The Changed Legality of Resale Price Maintenance and Pricing Implications case study are - Strategic Management Strategies, Marketing, Pricing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the The Changed Legality of Resale Price Maintenance and Pricing Implications casestudy better are - – increasing transportation and logistics costs, wage bills are increasing, technology disruption, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of The Changed Legality of Resale Price Maintenance and Pricing Implications
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Changed Legality of Resale Price Maintenance and Pricing Implications case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Leegin Resale, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Leegin Resale 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 The Changed Legality of Resale Price Maintenance and Pricing Implications can be done for the following purposes –
1. Strategic planning using facts provided in The Changed Legality of Resale Price Maintenance and Pricing Implications case study
2. Improving business portfolio management of Leegin Resale
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 Leegin Resale
Strengths The Changed Legality of Resale Price Maintenance and Pricing Implications | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Leegin Resale in The Changed Legality of Resale Price Maintenance and Pricing Implications Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Leegin Resale are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Learning organization
- Leegin Resale 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 Leegin Resale is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Changed Legality of Resale Price Maintenance and Pricing Implications Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Leegin Resale in the sector have low bargaining power. The Changed Legality of Resale Price Maintenance and Pricing Implications has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Leegin Resale to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Leegin Resale has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Changed Legality of Resale Price Maintenance and Pricing Implications 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.
Innovation driven organization
– Leegin Resale is one of the most innovative firm in sector. Manager in The Changed Legality of Resale Price Maintenance and Pricing Implications 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 Leegin Resale in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Leegin Resale is one of the leading recruiters in the industry. Managers in the The Changed Legality of Resale Price Maintenance and Pricing Implications are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Leegin Resale 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 The Changed Legality of Resale Price Maintenance and Pricing Implications HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Leegin Resale has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Leegin Resale to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Leegin Resale 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 Surinder Tikoo, Bruce Mather 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 Leegin Resale
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Leegin Resale does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Leegin Resale 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 The Changed Legality of Resale Price Maintenance and Pricing Implications - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses The Changed Legality of Resale Price Maintenance and Pricing Implications | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Changed Legality of Resale Price Maintenance and Pricing Implications are -
Low market penetration in new markets
– Outside its home market of Leegin Resale, firm in the HBR case study The Changed Legality of Resale Price Maintenance and Pricing Implications needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study The Changed Legality of Resale Price Maintenance and Pricing Implications, 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Changed Legality of Resale Price Maintenance and Pricing Implications 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 Leegin Resale has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Leegin Resale is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Changed Legality of Resale Price Maintenance and Pricing Implications 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 operating costs
– Compare to the competitors, firm in the HBR case study The Changed Legality of Resale Price Maintenance and Pricing Implications 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 Leegin Resale 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Leegin Resale has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Aligning sales with marketing
– It come across in the case study The Changed Legality of Resale Price Maintenance and Pricing Implications 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 The Changed Legality of Resale Price Maintenance and Pricing Implications can leverage the sales team experience to cultivate customer relationships as Leegin Resale is planning to shift buying processes online.
Need for greater diversity
– Leegin Resale 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 Leegin Resale is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Leegin Resale needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Leegin Resale to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Surinder Tikoo, Bruce Mather suggests that, Leegin Resale 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.
Interest costs
– Compare to the competition, Leegin Resale has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Opportunities The Changed Legality of Resale Price Maintenance and Pricing Implications | 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 The Changed Legality of Resale Price Maintenance and Pricing Implications are -
Creating value in data economy
– The success of analytics program of Leegin Resale has opened avenues for new revenue streams for the organization in the industry. This can help Leegin Resale to build a more holistic ecosystem as suggested in the The Changed Legality of Resale Price Maintenance and Pricing Implications case study. Leegin Resale can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Leegin Resale can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Changed Legality of Resale Price Maintenance and Pricing Implications 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Leegin Resale 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, The Changed Legality of Resale Price Maintenance and Pricing Implications, 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 Leegin Resale 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 Leegin Resale 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, Leegin Resale can use these opportunities to build new business models that can help the communities that Leegin Resale operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Better consumer reach
– The expansion of the 5G network will help Leegin Resale to increase its market reach. Leegin Resale 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Leegin Resale is facing challenges because of the dominance of functional experts in the organization. The Changed Legality of Resale Price Maintenance and Pricing Implications 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.
Learning at scale
– Online learning technologies has now opened space for Leegin Resale 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.
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. Leegin Resale can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Leegin Resale 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.
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. Leegin Resale 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. Leegin Resale 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Leegin Resale can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Leegin Resale 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.
Threats The Changed Legality of Resale Price Maintenance and Pricing Implications External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Changed Legality of Resale Price Maintenance and Pricing Implications are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Leegin Resale 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
– Leegin Resale 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. Leegin Resale can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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. Leegin Resale can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Leegin Resale.
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. Leegin Resale 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Leegin Resale with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Leegin Resale is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Leegin Resale has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Leegin Resale 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.
Regulatory challenges
– Leegin Resale 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.
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 Leegin Resale in the Sales & Marketing sector and impact the bottomline of the organization.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Leegin Resale 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 The Changed Legality of Resale Price Maintenance and Pricing Implications .
Weighted SWOT Analysis of The Changed Legality of Resale Price Maintenance and Pricing Implications 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 The Changed Legality of Resale Price Maintenance and Pricing Implications 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 The Changed Legality of Resale Price Maintenance and Pricing Implications 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 The Changed Legality of Resale Price Maintenance and Pricing Implications 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 The Changed Legality of Resale Price Maintenance and Pricing Implications 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 Leegin Resale needs to make to build a sustainable competitive advantage.
