B100 – TMA01
1) A SWOT analysis enables businesses to determine what strengths, weaknesses, opportunities and threats they may face based on internal and external environmental factors. It is useful for businesses to use this a tool to direct a strategic business plan. A strength shown on a SWOT relates to what the business does well and would show what attributes they need to maintain that are vital for success, such as a well-known reputation or high performing employees. A weakness shown would determine what the business needs to improve on, such as poor customer service or lack of innovation. Any opportunities highlighted will indicate which direction the business can progress in, including technology advances or more efficient outsourcing methods and threats will determine what risks/difficulties they may face along the way, for example competitive rates or technology advances (which could be either a threat or opportunity depending on how the business reacts). (Book 1, page 60)
2) (Secret Sales Case Study)
Human Resource Management
Accounting and Finance
A family run business. This would be a strength as the two brothers are likely to have an emotional involvement and a vested interest in key decisions.
They manage every stage of the process (e.g. packaging and dispatch) which enables full control of the level of quality for the customer.
Estimated revenue of $47m in gross turnover in 2015. This would suggest an incline in sales and future development.
Partnerships with large brands such as Dyson and Bose increases profitability and broadens customer base.
Backed by the large company: Partech Ventures meaning financial security.
Predominantly TV advertisement which catches a wide audience very quickly, using popular shows to ensure an effective response. Data analysis off the back of their campaigns creates statistics useful for strategizing.
A family run business could be classed as a weakness if there are any disagreements. Conflict could cause disturbance or problems when any key decisions are to be made.
It has taken a decade to make their profit as they are dependent on high sales volumes. This would indicate that it would be a challenge to maintain financial stability.
70% of their annual budget is spent on TV marketing which could be spent on other areas of the business that need improvement.
The majority of their marketing is through television, which could potentially mean other target audiences are being missed, i.e. customers that do not watch television, or the types of programmes that they attach to.
Working with well-established brands encourages more brands to get involved, thus potentially increases their profitability and target audience.
Further investments from venture capitalists could increase the budget they have for resources such as marketing.
Considering further fundraising campaigns which is an opportunity to help future growth.
Technological advances could enable the business to go one step further with their campaigns, e.g. texting customers and will allow them to expand on their data analysis programming (e.g. tracking customer trends) making it easier to determine trends in the market.
Not applicable to this case study.
The majority of their budget is spent on TV advertisement which is a threat to their future growth as competitors could be using their budgets more evenly towards other areas of the business (e.g. production) to benefit their longevity.
Many of the brands that they use are now running their own websites, making it harder to compete with marketing campaigns.
‘The evolution of the high street' will mean they will need to invest further in marketing to ensure they stay relevant against competitors.
3) The first issue Secret Sales should address would be the threat of ‘evolution of the high street'. It is very important that they remain relevant against their competitors and with so many internal and external factors evolving, there is a lot to consider. For example, internal evolution could include smarter ways of outsourcing resources and external factors could be the threat of reduction of costs for similar products sold by their competitors or technological advances that other competing brands utilise/ adopt better.
The second issue to be considered is the amount of budget that is spent on TV marketing – 70%. Although this is a brilliant way of marketing, it is important not to lose sight of other marketing strategies that no doubt their competitors will utilise to gain customers. It could mean losing out on many other potential audiences that haven't been considered which gives competitors a huge advantage.
4) A suggestion to keep up with the evolution of the high street would be to conduct market research on a regular basis, for example customer surveys to get a view from their perspective (as ultimately, this is who they need to please), pricing research to ensure their product pricing remains competitive against other businesses or focus groups to get detailed feedback about their products.
Different marketing strategies the business could utilise as opposed to just television could be billboards, direct mail campaigns and social media. With the rise of social media it would be advantageous to use this as an advertisement outlet. From this, they can continue to use their data analysis to compare statistics and continue with the most effective campaigns, investing further depending on success.
List of Sources
Schaefer A. (2017), B100 Block 1 Introduction, Milton Keynes, The Open University.
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