Case study 1

Case Study on Nestle

Nestls baby formula products affect the lives of innocent infants nationally and globally in a negative manner because of the organizations poor communicative methods. This wealthy company has failed to thoroughly convey messages and instructions for their products as they branched out to non-speaking countries. This is just one of many communicative failures Nestle has committed, and it is the reason why this company has experienced infamous boycotts that are worthy of research and recognition. In the following case study paper, we will comprehensively explain various topics dealing with Nestls baby formula products including the following: 1. The history and past reputation of its products that were distributed to developing countries. 2. Marketing strategies and why they were unsuccessful. 3. The demographics and statistics of its consumers and sales. 4. The current state of the company today. History and Past Reputation of Nestle Baby Formula Products This company dates back to 1867, when a Swedish merchant, chemist and inventor named Henri Nestle founded it. The Swedish-based company was the first to produce and market infant formulas to mothers who were either unable to breast-feed and/or to lighten their burdens of motherhood. Like many inventors in historical text, Henri Nestle named his company after his own last name to personify the commercial business. His main goals were to create secure and safe products that would provide nourishment for little ones born to a family environment. He strived to be recognized for producing traditional baby formula, both milk and soy-based, that would be the central element in Nestles corporate identity (Berkich, 2003). Nestles first commercially sold product was condensed milk, which was produced in Europe. Since that time, Nestle has become an oligopoly; producing other types of items that consumers may use. Aside from baby formulas, their products include the number one bottled water known as Nestle Perrier, and are the leader in instant coffee, and many of the popular candy out there today (Mantell, 2003). In addition, it is the manufacturer of cosmetics such as LOreal, eye care and nutritional supplements. Nestles contribution to this industry has made him the worlds favorite brand in over 489 factories worldwide. However, he has lost sight of providing consumers with high-quality nutritious foods for infants, especially as he began to seek success in international countries (Brabeck, 2003). Therefore, his quality image and reputation is no longer just that; rather it has become intricate according to different consumers. Like many large companies, Nestle had a vision of expanding and emerging outside of the United States. Perhaps, there was a specific reason that he branched out to countries like China, India, Russia, and Latin America. In these countries, it is culturally accepted that women are homemakers and child bearers. Therefore, women tend to stay home and care for their many children. Maybe this led Nestle to believe that they would spend large sums of money towards

baby formulas because not all women are physically capable to breast-feeding, especially after having several children. In addition, mothers sought easier and quicker methods to nourish their children. Nestls business tactics would have succeeded in these countries if he had clearly communicated effectively through his products. Marketing Strategies and Why They Were Unsuccessful Nestle is the largest food producer in the world and controls about forty percent of the global baby formula market. Interestingly enough, the baby formula market is a multibillion-dollar enterprise whose products are intended to insure the proper nurturing of precious infants, and helps lighten the burdens of motherhood. However, Nestle has created more problems for both infants and mothers by failing to successfully utilize the various media forms throughout its campaign; thus, creating poverty and disaster in third world countries. As the leading vendor of baby formula, both milk and soy-based, its annual profits exceed over $100 billion dollars. One of its main marketing strategies was the idea of expanding and branching out to emerging markets in foreign countries. However, in doing this, it failed to recognize the language barriers, economy as well as environmental hazards in each individual country. Their strategies geared towards the U.S. were successful and led to very high sales. One the other hand, the same effort was not placed forth towards their marketing campaign in third world countries. Nestle performed a poor job in marketing towards its targeted audience in these countries because they did not place equal effort as they did for the U.S. market. Nestle did several things during their campaign in third world nations.

Case study 2
The Body Shop Case Study
Introduction For people who live in different countries all over the world the words the body shop came to have a special meaning. Today, when one mentions going into one, it is very rare that the counterpart would not know what kind of body shop is mentioned. This is because the words the body shop today represent one of the largest cosmetic firms in the world The Body Shop that was founded in 1970 in England. In the following paper I would like to talk about the mentioned above brand. My paper will mainly focus on analyzing the reasons of raid growth and sudden decline of the brand. Additionally, the paper will discuss The Body Shop brand positioning and evaluate the companys market targets and the actions TBS (The Body Shop) took to reposition the brand. Brief History The green business idea to open up a shop that would sell only organic products was born in the minds of Anita and Gordon Roddick in the early 1970s. The British couple needed money to raise their children and for this purpose started their small business. Their first shop The Body Shop opened up in 1976 in Brighton, England. In their first shop Anita and Gordon sold vegetable, flower, and fruit-based products, ranging from facial creams to body butters. Additionally, the owners of the store encouraged clients to bring in their own bottles instead of buying products in new ones.

From early on it was clear that Roddericks business was a great success. Thus, the shop started opening new branches firstly in England and later in other countries. The brand was initially built around five values: opposition to animal testing, community trade, self-esteem, human rights, and protection of the planet. The owners of The Body Shop actively participated in community and charity events. When it came to advertising, Anita Rodderick was willing to bring an alternative message of beauty to the world. For her campaigns were not just words, she wanted to turn those words into actions. She did not want her products to be presented by women who torture themselves with diets or do everything possible to alter their bodies with help of plastic surgeons. She wanted her brand to carry a different message a message of health, happiness, and naturalism. In 1985 The Body Shop went public and signed an agreement to work with Greenpeace. In 1990 The Body Shop Foundation was established with the goal to fund human rights and environmental protection groups. In 1990s the company has made agreements with many world organizations working towards improvement of life conditions in the third world countries, environmental awareness and human rights. In 1996 The Body Shop launched a new program with the name The Body Shop at Home. In the framework of this program a customer may visit one of the 2000 at home stores situated in England, get free consultations from professionals and purchase the products from their homes. In March 2006, The Body Shop was taken over by LOreal. It was reported, that Anita and Gordon Roddick would make 130 million from the sale (The Independent). As of today, The Body Shop has 2,400 stores in more than 60 countries, additionally it is the second largest cosmetic franchise in the world. Rapid Growth and Decline of the Brand In the 1980s and the early 1990s The Body Shop had experience rapid growth. The success and recognition of the brand was remarkable. Not only the brand was presenting the consumers with innovating and appealing products, the company was also carrying a ver y right and attractive message. The above implies that The Body Shop had adopted a marketing approach that was different from other traditional retailers of cosmetic products. In particular, the products were promoted through unusual and pioneering brochures, moreover, Roddicks social and environmental activism was also a center of the companys marketing strategy. The aura The Body Shop had created and the reputation of producing healthy natural products that were good for consumers were the primary reasons of the Brands success. People loved the friendly little Body Shops that offered them cute little products made from fruit, vegetables and flowers. The prices for these products had never been low, though the attraction was too strong. In addition, rapid growth was caused by the lack of competition. Up till the mid-1990s, the had been no brands like The Body Shop, the consumer, affected by endless advertisings on importance of using natural cosmetics had no choice but purchase it from The Body Shop. However, by the end of 1990s, it was clear that the brand was going to experience a decline. This was primary caused by the emergence of many other retailers that would sell organic products for a smaller price. All of a sudden, The Body Shop stopped being the only retailer in the market and started to actually suffer because of the over-expansion in the previous years. By that time almost every mall in European countries and in Americas had a Body Shop, some of these body shops, were The Body Shops, though the once admired brand was lost within others. In the light of revenue decline the companys CEO and founder Anita Roddick resigned from the CEO

position and passed it down to the fresh management team. The new management tried to bring the revenues to at least the levels it used to have, however, the new programs were not entirely successful. Even though, new management managed to grow the revenue, they lost 21% in their OIBT. Thus, another major reason for the decline of the brand, in my opinion, was a lack of forecasting and use of inappropriate financial modeling. Furthermore, I assume that the brand suffered in the late 1990s and early 2000s because of quality issues related to The Body Shop products and rumors and controversy that started to surround the brand. An example of such controversy was the takeover of the company by LOreal. LOreal was accused of testing products on animals that contradicts The Body Shops core value of Against Animal Testing. As a response, LOreal denied the claim, at the same time as The Body Shops reputation of a green business was scattered into pieces. Positioning and Repositioning of The Body Shop Products The previous section of the paper was ended with a story of the decline of The Body Shop. Of course, when the management of the company faced this problem in was clear that the marketing approach had to be changed. The brand had to come up with something that would distinguish it from other new retailers of the kind and it had to embellish its agenda to win the consumers back. Thus, with such goals the company started the repositioning campaign. In the framework of the new positioning campaign that had received the name masstige, the company had focused mainly on the customer experience. The message about improving customer experience was given by the company through its revised mission statement, through its corporate website, through its advertising. The masstige positioning was characterized by combining excellent service with an all-embracing variety of naturally-inspired personal care products that offer performance, indulgence and great value. The new positioning program not only included launching of an innovative range of personal care products, but it also involved new store design, new customer service programs for sales associates and At Home consultants. Furthermore, as part of its repositioning campaign The Body Shop undertook to deliver high quality products at the lowest cost. However, the price of products, though being lowered, was not low enough. The company could not risk offering its products for a very favorable price as well as offer promotions like 20% off its products because that would tell customers that the regular price was not really the lowest it could possibly be. However, in order to make the customers feel cared for and give them a feeling of purchasing products and making a good deal the company developed added value, sampling opportunities and gifts with purchase. Lastly, the company started to work with multi-channels, franchising continued to be an important revenue generator, however the company started working though At Home and the Internet channels.

Case study 3
Case Study on Honda Motors
Why did Honda build a plant in the United States (what were the objectives)? How is the plant in the United States affecting the company in Japan? What problems or advantages might the US operation give Honda in the future?

Honda wanted to debunk the claim of the auto industry that nobody can make an economy car in the United States at a profit. It had a relatively small market share in the Japanese car market and it needed an outlet to grow. These were the main reasons for Honda to start a manufacturing plant in the United States. As it is evident, they wanted to introduce an economy car to the US market and still make good profit percentages. Besides this during the early 1970s the gas prices were very high and so they wanted to introduce a fuel efficient car at an economical price. International businesses engage in transactions across national boundaries. These transactions include transfer of goods, services, technology, managerial knowledge, and capital to other countries. Unifying influences occur when the parent company in Japan shares technical and managerial know-how, thus assisting the host company in the development of human and material resources. Moreover, the parent corporation and the firm in the host country may find it advantageous to be integrated into a global organizational structure. Being an MNC, it can take advantage of business opportunities in many different countries. It can also raise money for its operations throughout the world. Moreover, it benefits by being able to establish production facilities where their products can be produced more efficiently and effectively. It can have access to natural resources and materials that may not be available to domestic firms. Finally, they can recruit managers and other personnel from a worldwide labor pool. The advantages of an international operation must be weighted against the challenges and risks associated with operating in foreign environments. One problem is the increasing nationalism. In addition countries have not only become aware of their natural resources but also become more skilled in international negotiations. Finally, Honda must maintain good relations with the United States, a task that may prove difficult because governments frequently change and corporations must deal with, and adapt to, these changes. Why was Honda able to build economy cars in the United States when American car manufacturers could not? What advantages does Honda have over the American companies? Honda was a Japanese firm, and the Japanese culture is based more on team work rather than US culture, which focuses more on individual achievements. The US automobile manufacturing plants are far more automated than Hondas plant in the US. This requires them to pay a lot of money in training the workers to learn how to use the machinery. This adds to the cost of production and hence the final retail price of the car is very high. In Hondas case, they have a plan that is less automated and the employees are taught by professionals trained in Japan, how to assemble cars in teams in an assembly line production. This reduces the cost of training the employees in learning how to use complex machinery and hence reduces the overheads per worker. Hence, reducing the cost of production which enables them to price their cars lower than the American made automobiles. Honda provides it workers with stocks in the company. They believe that all employees are equally important. All the workers are involved in the decision making process, which makes them more committed to the company and gives them a sense of belongingness and importance. The job satisfaction amongst the employees is very high. The workers are very proud of their work and they like working at Honda even tough they receive lower wages than other U.S. workers. Since the workers receive stock options and are happy with their jobs and accept lower

pays, the overall costs decrease and hence the company is able to meet its goal of providing economy cars in the US, and still make a fair share of profits. In contrast, the US managers have been accused several time of making decision even before the problem has been discussed. This causes the employees to loose interest in the company and they begin working only for financial reasons and not for the better of the company. American car companies generally concentrate on building muscle cars, i.e. cars that have a lot of power, and are big in size. This causes the cars to be of higher prices and doesnt suit the needs of the customers, who are the young professionals who prefer smaller, compact cars. In this way Hondas existing compact-car production lines appeal to the growing number of young professionals. The Japanese manufacturers concentrate in performance and fuel efficiency which had helped them gain an edge of the US automobile companies. Moreover, as a Multi-National Corporation, the profits made in the US are only a fraction of the profits made by the company as a whole and so the company is very profitable and appealing to the investors and shareholders. How much of Hondas success is due to its policies? How much is due to non-managerial factors? Honda attributes its success to workers who are willing to work hard for the company. But actually, it is the management policies of Honda that have created such a win-win situation. Involving the workers in the entire decision making process and reaching the final decision using consensus (i.e. all the workers agree to the decision) has played an important role in the success of the organization. Providing the workers with stock options rather than high wages is an effective method to gain employee commitment, as the employees will work harder to increase the share value which in turn increases their returns on the stocks they hold. These are the effective managerial practices that have helped Honda reach where they are today in the US market. Besides the effective and unique managerial policies, there are certain non-managerial factors also that have attributed to Hondas immense success. Firstly, they didnt rely heavily on the use of automated machines for the production of their cars, which helped in reducing costs. Secondly, they stresses on team work rather than individual efforts, which reduced training costs and increased employee efficiency. Thirdly, they concentrated on the growing segment of the market, i.e. the young professionals, and produced more compact and fuel efficient cars rather than the large and powerful American cars. Fourthly, they helped Japaneese suppliers setup plants near their production facility, so that they could reduce their inventory and whenever they needed parts they could just order it from next door. This further reduced transportation costs and overall costs. Finally, to maintain a good image in the American market, they sold not only the economical compact cars but also luxury cars under different names and dealerships. This helped increase the net amount of profits, and further lowered the retail price of the compact cars. In conclusion one can say that Hondas success must be attributed to its good balance between the managerial and non managerial practices. They have revolutionized the auto industry and have debunked the claim that nobody can make an economy car in the United States at a profit.

Case study 4
Case Study on Dell
Dell Computer Corporation is the worlds leading computer systems company and a premier provider of computing products and services The Company was founded in 1984 by Michael Dell on a simple concept: by selling computer systems directly to customers, the Company could best understand customer needs and efficiently provide the most effective computing solutions to meet those needs. The Company is a Delaware corporation that was incorporated in October 1987, succeeding to the business of a predecessor Texas Corporation that was originally incorporated in May 1984. . At this time, in fiscal year 2002 the Companys revenue was $31.2 billion. Dell Computer reversed its loss of a year ago in the second quarter as the top computer maker continued to take market share in a flat market. For the three months ended August 2, Dell earned $US501 million on $US8.46 billion in revenue. That compared with a loss of $US101 million, in the year-ago quarter on revenue of $US7.61 billion which incredibly successful while the computer demand is rapidly decreasing. Competitors is one of the biggest problems that Dell is facing, we can understand it exceedingly by analysis the new product line that Dell is going to introduce to the world; white -box, PCs, printers, and handheld devices. Dell recently is making rapid inroads into the enterprise storage market, which is almost as large as the PC market while all the Dell is continuing with its drive into the mid-range server market, where its Windows/Intel offerings compete with Unix-based machines made by traditional vendors IBM, HP and Sun. Throw in Dells recent signal that it intends to aggressively pursue HP into the printer business, and hints that networking and handheld PDAs are also on the agenda. All of these are because of worries and solutions to its competitors. The companys financial stat is in an extraordinarily good shape. During rapidly decreasing demand in computer industry, Dell still mange profits over its competitors. The Companys direct business model gives it the ability to operate with reduced levels of component and finished goods inventories. As the result, the Companys financial success in recent periods has been due in part to its asset management practices, including its ability to achieve rapid inventory turns while its competitors have to spend huge amount of resources to its asset management. On the agenda for Dells July 2002 annual shareholder meeting is a prevision of what Dell Computer has to offer to its shareholders. Dell alone among the largest computer-systems companies is profitably gaining market share, and was able to counter an industry trend last week by raising its guidance for second-quarter revenue and profit growth. This sharp attention to customer requirements, ability to satisfy growing preference for standards-based servers and storage products, and leading efficiency from crisp execution continue to position the company best for value creation today and beyond. While the annual directors meeting is still held by the board, the directors are still waiting for the approval of agenda and the meeting dates.

For the first quarter, Dell earned $457 million, compared with $462 million a year earlier. During the same period, revenues increased from $8.03 billion to $8.07 billion. Dells future prospects will increase profit in the second quarter if they continuing the cost-cutting efforts and gaining market share. Although the computer industry seen the stabilization to slight strengthening in the business, economic recovery still yet the most important future opportunities they might anticipate. Over all, by executing on Dells successful strategy, it was the only PC maker that increased profits, while also gaining market share. Trading at approximately 40 times earnings, Dells stock price will certainly not mount a big run, yet it should stay within a trading range until the economy recovers.

Case study 5
7-Eleven Japan Case Study
1. What factors accounted for 7-Elevens initial success in Japan? The most important factors 7-eleven had was the alliance they had with Ito-Yokado, since the company became Japanese owned it started to have success because of the detailed knowledge of the legal, political, and social environment of this country. Ito-Yokado had the experience of working in Japan as a large Japanese supermarket chain operator. The joint venture was highly successful, with 7-Eleven becoming the larges convenience store operator in Japan. Another factor one must site is that 7-Eleven gave the opportunity to Japanese to make shopping anytime, so it was an innovative way to attract Japanese people. The function of distribution point was another factor to have success because Japans population is so big that it is hard to reach everybody at the same time, so customers who wanted goods from an internet marketer could order the goods over the internet and the internet marketer would ship the goods to a 7-Eleven store near to the customer. 2. What factors accounted for 7-Elevens continuing success in Japan? A factor that helped to continue the success in Japan when they started to grow and sell more products to the market for example when they entered into agreement with Softbank Corporation, Tohan book wholesalers, Yahoo Japan, and others to create a venture to sell books and video using a web site on Yahoo Japan. The several partnerships helped 7-eleven to continue its success for example the Sony partnership, NEC, Mitsui, trading company, and Japan Travel Bureau, to distribute a wide range of products, to provide music, and photos online, and to handle book and ticket sales. That penetration in the Japanese market drove and will continue driving 7-Eleven to be more successful. 3. Is 7-Eleven Japan wise extending its delivery and payment services to Taiwan? Yes, Taiwan appear to offer excellent potential for a profitable extension of 7-elevens delivery and payment service for items ordered on the internet. Taiwan has an even higher population density than Japan, it means that the population will drive 7-eleven to have success in the market place with its delivery and payment services. 4. If its extension of service to Taiwan is a success, should it extend such services to the United States, Thailand or other countries? What factors should be taking into account in making such a decision.

One must think that the services offered by 7-eleven in Japan and Taiwan would not work in the United States, because American people trust more on the payments of credit cards and buying on the internet. There would not be success also because of the many delivery companies the United States have. Thailand or other countries, there would be a possibility of having success offering these same services, but the x country needs to be analyzed carefully if 7-eleven could have success, because some countries are different doing business. Culture is one of the most important factor that could affect the success on any country because there are many different ways people do shopping, trust on services (like shopping on the internet, and the delivery of products). Another factor that should be taken to account in making the decision of entering to any market would be legal, political and social environment, there are risks those environments bring because there are some countries where it is difficult for a foreign company to be acceptable to do business. 5. Is the offering of more services in Japan, including banking, provision of in- store terminals for use by customers, etc, likely to cause problems for part-time workers in the franchises? One must think that there would not cause problems because there is a market for everything. The part-time workers would have to continue working where they are and the offering of more services will bring more work opportunities for people to work as well for there would not cause any problems for the part time workers and for the business owners neither.

Case study 6
Case Study on Outback Steakhouse
In the case study we defined five main problems Outback SteakHouse is facing at the present time. From these 5 problems we will choose one to look at more in depth and give an analysis and a solution to solving that problem. One of the main problems that we found in the case was the fact there is very stiff competition not only in the casual dining business, but specifically the steakhouse business. Competition comes from many places; restaurants themselves are the obvious choice, places like Lone Star Steakhouse and Saloon, Sizzlers, and other restaurants. Also many traditional restaurants have upgraded their steak choices in order to compete with Outback. Along the same lines as direct competition is the fact that the restaurant industry is close to saturation. Analysts have said, Casual dining operators such as Outback were close to saturation and questioned whether the firm could withstand the intense competitive pressures characteristic of the industry (W-80). One way to solve this problem is to differentiate themselves from other restaurants even more than they already do. Also they need to show the consumer that they need to eat at Outback, this can be accomplished through marketing and promotion. Another problem that we found was that Outback Steakhouse has been traditionally seen as a dinner destination and has played this role by only being open seven hours a day from 4:30pm to 11:30pm. This was stated as a strength in the case, but we feel that Outback is missing out on the

lunch crowd and could dramatically increase business by adjusting their traditional hours of operation, they are busy during the dinner hours, why not try lunch? Recently, personal health has become a large issue in American culture and this shift in ideals has created new problems for restaurants. The trend to cut back on the intake of red meat has created a problem for restaurants like Outback, which traditionally serve high quality red meat. If the current trend continues and Americans continue to watch how much red meat they eat, Outback will have to find a way to combat these ideals in order to stay successful. Possible alternatives are serving more chicken and fish and possibly adding to their menu for the more health-conscious consumer. Outback will never be known as a health food restaurant, but by giving the health conscious consumer more options they have a chance to tap into that market. After reading the case and personally eating at an Outback, we have found that they are currently unable to meet customer demand. People have been known to wait up to three hours to eat at their restaurants. We feel that they are missing out on the people who dont have the time to wait to eat their steaks. By increasing the size of their restaurants we feel that they will better be able to serve their customer base. Along with expansion, they should also look into expanding the size of their waiting area, so that the customers that do choose to wait are entertained and have an overall great experience at the restaurant. The customer should leave not only with a full stomach but also a smile from an all-around good dining experience. The final problem that we feel Outback is facing is the fact that they are lacking productive management structure. Currently headquarters in Tampa employ about 80 people, this can currently be seen as a great strength for Outback, it shows that they are very efficient, and get a lot done with few resources. In the future we feel that Outback will be faced with problems due to their increased size and complexity (adding another restaurant chain). The way that we see to alleviate this problem is for them to look at their current structure and possibly consider a restructuring of their management process. This will be a great task, but in order to avoid problems in the future we feel it is necessary.