De Beers Group: Marketing Diamonds to Millennials SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of De Beers Group: Marketing Diamonds to Millennials
In 2017, the next generation of consumers that were poised to become engaged to be married-millennials-showed different preferences and consumption patterns than previous generations had shown. In response, the De Beers Group of Companies (De Beers), a leading company within the global diamond industry, was making moves to capture this important market. In partnership with the world's six other leading diamond companies, known collectively as the Diamond Producers Association, De Beers launched a campaign titled "Real is Rare" with the goal of persuading millennials into believing that diamonds were an important symbol of romantic commitment, even in 2017. Would these marketing endeavours be successful in changing the millennial mindset, or would the campaign fall flat? Would diamond engagement rings continue to be the ultimate symbol of commitment? What could De Beers do to encourage sales of diamonds in a changing world? Stefanie Beninger is affiliated with Simon Fraser University. Karen Robson is affiliated with Central Michigan University.
Swot Analysis of "De Beers Group: Marketing Diamonds to Millennials" written by Stefanie Beninger, Karen Robson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Beers Diamond facing as an external strategic factors. Some of the topics covered in De Beers Group: Marketing Diamonds to Millennials case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the De Beers Group: Marketing Diamonds to Millennials casestudy better are - – technology disruption, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, wage bills are increasing, there is increasing trade war between United States & China,
digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of De Beers Group: Marketing Diamonds to Millennials
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in De Beers Group: Marketing Diamonds to Millennials case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Beers Diamond, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Beers Diamond 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 De Beers Group: Marketing Diamonds to Millennials can be done for the following purposes –
1. Strategic planning using facts provided in De Beers Group: Marketing Diamonds to Millennials case study
2. Improving business portfolio management of Beers Diamond
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 Beers Diamond
Strengths De Beers Group: Marketing Diamonds to Millennials | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Beers Diamond in De Beers Group: Marketing Diamonds to Millennials Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Beers Diamond 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.
Strong track record of project management
– Beers Diamond is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Beers Diamond 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 De Beers Group: Marketing Diamonds to Millennials - 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
– Beers Diamond is one of the leading recruiters in the industry. Managers in the De Beers Group: Marketing Diamonds to Millennials are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Beers Diamond has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Beers Diamond to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Beers Diamond is present in almost all the verticals within the industry. This has provided firm in De Beers Group: Marketing Diamonds to Millennials 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.
Training and development
– Beers Diamond has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in De Beers Group: Marketing Diamonds to Millennials 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
– Beers Diamond is one of the most innovative firm in sector. Manager in De Beers Group: Marketing Diamonds to Millennials 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 Beers Diamond in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Beers Diamond has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Beers Diamond 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
– Beers Diamond 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 De Beers Group: Marketing Diamonds to Millennials HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Beers Diamond 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.
Weaknesses De Beers Group: Marketing Diamonds to Millennials | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of De Beers Group: Marketing Diamonds to Millennials are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study De Beers Group: Marketing Diamonds to Millennials, in the dynamic environment Beers Diamond has struggled to respond to the nimble upstart competition. Beers Diamond has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Beers Diamond 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.
Low market penetration in new markets
– Outside its home market of Beers Diamond, firm in the HBR case study De Beers Group: Marketing Diamonds to Millennials needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Stefanie Beninger, Karen Robson suggests that, Beers Diamond 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study De Beers Group: Marketing Diamonds to Millennials, is just above the industry average. Beers Diamond 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.
Slow to strategic competitive environment developments
– As De Beers Group: Marketing Diamonds to Millennials HBR case study mentions - Beers Diamond takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Beers Diamond is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study De Beers Group: Marketing Diamonds to Millennials can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Beers Diamond is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Beers Diamond needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Beers Diamond to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study De Beers Group: Marketing Diamonds to Millennials, 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.
Skills based hiring
– The stress on hiring functional specialists at Beers Diamond 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.
Products dominated business model
– Even though Beers Diamond 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 - De Beers Group: Marketing Diamonds to Millennials should strive to include more intangible value offerings along with its core products and services.
Opportunities De Beers Group: Marketing Diamonds to Millennials | 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 De Beers Group: Marketing Diamonds to Millennials are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Beers Diamond 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.
Better consumer reach
– The expansion of the 5G network will help Beers Diamond to increase its market reach. Beers Diamond 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.
Using analytics as competitive advantage
– Beers Diamond 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 De Beers Group: Marketing Diamonds to Millennials - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Beers Diamond to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Beers Diamond 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. Beers Diamond 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.
Learning at scale
– Online learning technologies has now opened space for Beers Diamond 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.
Buying journey improvements
– Beers Diamond can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. De Beers Group: Marketing Diamonds to Millennials 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.
Developing new processes and practices
– Beers Diamond 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.
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 Beers Diamond in the consumer business. Now Beers Diamond can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Beers Diamond is facing challenges because of the dominance of functional experts in the organization. De Beers Group: Marketing Diamonds to Millennials 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.
Building a culture of innovation
– managers at Beers Diamond 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Beers Diamond can use these opportunities to build new business models that can help the communities that Beers Diamond operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Creating value in data economy
– The success of analytics program of Beers Diamond has opened avenues for new revenue streams for the organization in the industry. This can help Beers Diamond to build a more holistic ecosystem as suggested in the De Beers Group: Marketing Diamonds to Millennials case study. Beers Diamond can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Beers Diamond 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.
Threats De Beers Group: Marketing Diamonds to Millennials External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study De Beers Group: Marketing Diamonds to Millennials are -
High dependence on third party suppliers
– Beers Diamond 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.
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 Beers Diamond.
Consumer confidence and its impact on Beers Diamond 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.
Increasing wage structure of Beers Diamond
– 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 Beers Diamond.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study De Beers Group: Marketing Diamonds to Millennials, Beers Diamond 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Beers Diamond 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.
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. Beers Diamond needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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 Beers Diamond in the Sales & Marketing sector and impact the bottomline of the organization.
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. Beers Diamond 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.
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.
Regulatory challenges
– Beers Diamond 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.
Environmental challenges
– Beers Diamond 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. Beers Diamond can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Technology acceleration in Forth Industrial Revolution
– Beers Diamond has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Beers Diamond 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.
Weighted SWOT Analysis of De Beers Group: Marketing Diamonds to Millennials 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 De Beers Group: Marketing Diamonds to Millennials 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 De Beers Group: Marketing Diamonds to Millennials 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 De Beers Group: Marketing Diamonds to Millennials 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 De Beers Group: Marketing Diamonds to Millennials 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 Beers Diamond needs to make to build a sustainable competitive advantage.
