Strategic marketing is a procedure of gathering data related with the market environment and accordingly formulates marketing strategies in order to achieve pre-determined market goals. Bosch is one of world’s leading multinational brand which deals in offering number of products and solutions such as security systems, automotive parts, home appliances etc. Writer is asked to follow Learning outcomes described below in order to achieve passing criteria:
- Examine how to evaluate and manage current and future intrinsic and extrinsic environment.
- Produce a strategic marketing plan to achieve organisational objectives
- Organize resources to successfully execute the strategic marketing plan
Marketing is the method in which goods are sold to buyers according to needs and wants of all customers (Dibb, 2012). Manager has to create innovative and effective strategies so that they can easily attract various users. They also create policies so that they can promote their business in proper manner. Through this they can easily capture many people and hence firm can earn more revenues. Report describes about Bosch which is a auto mobile firm and now it introduces a E learning software in English for providing basic and advance course of engineering. Assignment explain about macro environmental analysis, three modes of entry, market segmentation and Porter's generic strategy.
1. PESTLE Analysis of BOSCH
There are a number of external factors that significantly impacts the overall functionality and operations of a company whether directly or indirectly. Thus , it becomes utmost important for accompany to critically identify , analyse and evaluate various external factors of particular nation in where it is to conduct its business activities (Preston, 2012). In given assignment, Bosch has decide to launch an online software for providing basic learning of engineering through online study materials and videos in English language. Company has taken this decision for encouraging the upcoming budding talent in Romania for gearing up to provide education and employment opportunities to its young talent. This decision is taken by the Bosch considering the percentage of english speaking population in these nations i.e. sums as Romania with 31%, turkey with 17% and Tunish 7%. Thus it is expected to be most adoptable in Romania since out of these three nations it scores highest in people who speaks english language. Another reason for same decision is that literacy rate of Romania is also the highest in comparison to Turkey and Tunia i.e. 98%. Also it is due to the fact that Romania is expected to experience increase in its GDP by 5.1% by the end of 2018 which opens many growth prospectus for Bosch to capture market share in this fast developing economy.
Mentioned below is PESTEL analysis of Bosch in context of its new market in Romania. This analysis is expected to assist company in identifying various external factors like political, social, economical, technological, legal and environmental and their probable impact on its business operations.
Political Factors: Political factors involves various attributes related to political stability, tax rates, government rules and regulations etc. that a firm is required to follow in order to successfully conducts its business activities. In context of Romania, the economy is subject to greatly impacted from fallout of Brexit (Rundh, 2011). However the political stability of Romania and expected increase in its GDP by the end of 2018 emerges a opportunities for Bosch. It is because it indicates that there is minimum tension in terms of political setbacks that prevails in Romanian market. Thus, it reaps the chances of higher growth for the company. However Bosch being a global firm is required to adhere by various legislations of different nations in which it has its operations running,. Thus, it becomes critically important for Bosch to follow all legislation related to IT sector such ad laws related to protection of privacy in electronic communication, Romanian Copyright law, law on electronic commerce etc. Thus, one side it is to make it easy for firm to successfully launch its new online software in this developing economy however it is also subject to various legal formalities and government intervention that is likely to impact it policies, strategies and decision making process.
Economic factors: these factors involves inflation rate, income of people, employment rates,foreign exchange rate etc. The yearly BET index indicates positive evolution in the capital market of Romania. Thus, it is a positive sign for Bosch to carry out its project in Romania. Also Bosch is expected to get benefited from the subsidies provided by both governments for educational sector (Sunkada, Verizon Patent and Licensing Inc, 2011).
Social Factor: It comprises living standard of people, educational level, attitudes towards work, career etc. Since, Romania is a developing economy and growing popularity of digitalization Bosch is to get advantage to capture large market share in Romania. It is due to that fact it is 7th largest nation in terms of population in European union. This indicates the growing opportunities in the education and employment sectors. Thus, with young talent who are becoming aware of new techniques and ready to adopt them in order to build up their career company online software service for imparting basic engineering education in English is to provide them life time chance to learn basic engineering skills at less time and cost.
Technological factors : It includes factors rate of adoption of new technology, internet connectivity, level of automation etc. Romania been a developing economy is greatly influenced by digitalization and is positive and proactive towards adopting latest technology. This is evident from that fact in 2017 75% of Romania's banking sector, business sector, 60% of media and advertising sector and 100% of its IT and Research and development sector was influenced and has adopted digitalization in its operations . This indicates a success path for Bosch to launch its online english software for imparting engineering eduction as it is to big hit in youngster who are becoming techno savvy (Tomczak,Reinecke and Kuss, 2018.)Wrenn, B. and Mansfield, P. M., 2014..
Legal Factors: It comprises various rules and laws that are incorporated by government of Romania. Thus , It is of critical importance for Bosch to adhere by all legislations related to online and e-commerce sector and other terms and conditions that are laid down by the government of Romania.
Environmental factor: It includes factors like weather, pollution, availability of non renewable products, pollution etc. It is of critical importance for Bosch to conduct its activities according to various environmental laws that are incorporated by the government of Romania. Also company is working towards making its new online software into energy aware software by making use of Green IT strategy (Tomczak, Reinecke and Kuss, 2018).
2) Three modes of entry and recommendation with justification
There are different modes of entry which is available for company. Hence company can easily expand their operations and can earn more revenues. Basically there are two modes that is equity and non equity. In equity mode it develops joint ventures. On another hand in non equity include the wholly owned subsidiaries and contractual agreements. Different modes of entry in foreign market are described below:
- Exporting: It is the effective method in which company offers the products and services in one nation(home country) to other ( host nation). It is classified into two parts:
- Direct export: It is an effective technique in which company is exporting items and products are exported by home nation. It focuses on expanding their activities and operations. This is an effective mode in which company is focusing on the expanding their economies of size of home nation. There is less risk in distribution channel which exist in direct exporting. Hence company can earn more revenues and can maintain good image in minds of all users.
Company can easily deliver their software to other people so that they can easily learn about basics and advance course of engineering.
- Indirect export: It is an effective method in which transports of goods are performed by the locally based intermediaries. They sell products to target users ans to import whole sellers (Routledge.Gilmore, 2011).
- Legitimate procedure: The company who has to export their goods to another country has to follow the different rules and regulations which are created by Romania export Council Regulation No. Firm has to satisfy all paper and lawful paper work and hence they can easily perform the work related to exporting (Gerritsen and van Olderen, 2014).
- Joint venture: It refers to the agreement in which two organizationals work together for a particular purpose. Hence they can perform all tasks and activities. Profits and losses are shared by both companies. Company has different objectives which include technology sharing, risk sharing, shared governance and ownership. Firm can easily expand their activities in minimum time. Hence it can easily earn huge amount of revenues. Thus it can easily increase the market share.
- Lawful procedure: Partners of Joint venture needs to provide different information and data related with the project. There are various complain ace for this market mode and it has to be followed by company who want to expand their operations and activities through this mode. Company has e to give a clarification that what are different motivation levels and how it can give profit to different individuals and society (Wrenn and Mansfield, 2014).
- Strategic alliance: It is an agreement in which two or more parties have decided to share the same resources so that they can easily accomplish the objectives. In this step two organizations come together and they take decision to pool the resources. This is only for certain period of time. Organization can easily enhance their revenues and they can expand their tasks in less time. Hence enterprise can maintain good and positive image in minds of all people and in industry.
- Legal procedure: If company enters the new market by strategic alliance then it has to explain clear objectives, appropriate accomplice, adaptability from Romania government. Hence the company has to fulfil the amendment related with Romania Joint venture Ordinance.
Recommended market entry mode:
After evaluating different modes company decides that it can follow the strategic alliance and hence it can easily expand their activities and operations. Bosch is expanding their operations and hence it is take decision to deliver different software which gives the data and information related to basic and advance course of engineering. Through this they can easily expand their activities and operations in minimum time.
Organization decides the strategic alliance as it is the effective and efficient method as compared to above methods and techniques (Harding, 2017). Through this business can maintain competitive advantage over other companies and firm can give strong competition to other company (Hunt, 2015).
3) Market segmentation and targetting and critically evaluate the potential target
Segmentation is the technique in which populations is divided on different basis such as caste, religion, caste, gender etc. Through this company can easily create different strategies and hence they can target the people. This helps the company to earn more revenues and they can also enhance the market share. It is an effective and efficient method. Company is delivering different software's to Romania so that they can have knowledge of basics and advance course of engineering. Hence it can easily increase the awareness level of all people. Hence basis of segmentation done by Bosch is described below:
Demographic segmentation: In this step company divides the whole population on basis of caste, religion , sex , gender etc. Through this, Bosch can create effective strategies and can target to adults and youths as they only study engineering. In this firm creates polices to deliver the software which helps in giving education to engineers by giving them the software's. So organization can create effective policies and plans so that they can easily target the adults and young people.
Behavioural segmentation: This is a different method in which company divides the whole population on basis of attitude and lifestyle of various users. Hence company evaluate the behaviour and attitude of users and then create strategies and policies to target the adults and young people. This directly helps the company to enhance their revenues and can also enhance market share. Business can also expand their operations and can enhance the reputation.
Psycho-graphic segmentation: It divides the population on basis of different income level and the psychology of various customers. Through this enterprise can easily target to adults and young people and can maintain strong place in market and in industry. This also helps the organization to earn more revenues. Hence business can enhance the market share and can increase the satisfaction level of all people.
Geographic segmentation: It is the effective and efficient method in which company is dividing the population on basis of cities, towns, villages etc. Bosch is generally selling their soft wares in Romania and it is targetted to young people and adults. So they can easily enhance the market share and can earn more profits (Lee and Carter, 2011). Organization can easily sell different software's in Romania and they generally deliver to towns. It is done so that organization can easily target to youths and adults. This helps the enterprise to enhance their profits and firm can also enhance the market share (Liebl, 2015). Hence they can easily expand their activities and operations. This helps the organization to maintain positive and good image in minds of all people.
From the above discussion it is clear that organization can create various effective and efficient strategies so that they can take steps to satisfy the demand of people. It divides the population on basis of various basis and the take decision to target the population. Hence organization can create effective policies and plans to target the adults and young people. Generally engineering is done by young adults and hence company has taken decision to target the young people and creates a software which gives basics and advance course related to engineering. Hence it can easily target to adults and enterprise can generate more revenues.
4) Porter Generic strategy
Different strategies are created by company so that they can easily create unique position in market. There are different changes in the company and hence organization take decision to create effective and efficient strategies so that firm can earn more revenues and can expand their tasks in minimum time.
Company sets a unique and distinct goal for the company. It is done so that enterprise can maintain strong place in industry. It is important that company motivates all staff members so that workers give superior results. Porter's generic strategy is described below:
Cost leadership strategy: It is the effective and efficient method in which company reduces the cost of all software's and hence they can earn more revenues. This is done so that firm can easily enhance the market share. It is the important strategy which is used by organization. Through this they can easily enhance the revenues and can enhance the market share. It delivers software to Romania and sells them to adults and young people at less price. It is done so that they can easily enhance their revenues and can also increase their market share. It is also important as it can increase the satisfaction level of all people in Romania and it directly helps the firm to expand their operations.
Differentiation strategy: In this method company sells different software's and its is done so that they can enhance the satisfaction level of all people (Meidan, Moutinho and Chan, 2015). It is important that firm use selling different products as then only it can bring happiness among all people. Through this enterprise can enhance their revenues and can also expand their operations. This is also done so that they can enhance their reputation in minds of all people and in industry (Meissner, 2012).
Cost focus: In this method company targets to niche market and then it reduces cost of all products. This is done so that they can enhance the satisfaction level of all people. This is important that organization uses these methods as then only they can maintain unique position in market and can earn huge revenues. Through this firm can enhance the market share and can maintain positive image in minds of all people. Through this enterprise can also expand their operations in minimum time. It results in enhancing of reputation of firm in the market.
Differentiation focus: In this method company is targetted to niche market and they sell different products to niche market. Hence they can earn more revenues and can enhance the market share. It is an effective and efficient method in which company can easily targeted to the market and hence they can earn huge revenues. It also results in increasing satisfaction of all people. Through this firm can expand their operations and activities in minimum time. Hence it can enhance the reputation in front of all people. Through this strategy firm has to create effective plans and policies so that they can create different and unique products.
From above discussion Bosch has selected cost leadership strategy and it take decision to deliver different software's which give basics and advance course at less price to people living in Romania. It is mainly targetted to young adults and people as they only study engineering. Hence company can enhance their revenues and can enhance the market share. This also helps the enterprise to expand their activities and operations in less time. Hence they can enhance their reputation. Thus they can maintain positive image in minds of all people and in industry. So organization can maintain distinct place in market (O'Malley, Story and O'Sullivan, 2011). This also helps the enterprise to give strong competition to other people and company can become market leader.
It has been concluded that strategic marketing is important in every company. Firm has to create effective policies so that all activities are properly managed. Through this firm can enhance their revenues and enhance the market share. Hence organization can maintain unique position in market and can expand their operations in minimum time. This also helps the enterprise to enhance their reputation. In this manner they can maintain positive image in minds of all people and in industry.