Strategic Management and Swot Analysis

Contents I. INTRODUCTION a. Brand Extension for LOREAL II. LITERATURE REVIEW a. Ansoff Matrix b. fig out Analysis c. BCG Matrix III. REFLECTIVE STATEMENT IV. REFERENCES Brand Extension for LOREAL Brand consultation takes place whenever a company wants to enter a advanced securities industry by using the name of one of its existing taints, rather than using a newfound one. Especially the luxury sector takes advantage of its long-familiar brand names when it comes to launching new merchandises into new markets (Kapferer, 2008, p. 295).The popularity of brand extension strategy is due to the belief that it leads to higher consumer trial than the use of a new brand name because of the awareness levels of the brand name being leveraged (Keller, 2003, p. 582). LOreal as a global brand is known for high quality enhancive considerablys like make-up and hairsbreadth care products for women, men and kids. Its mission Beauty for all connects with the companys slogan Because youre wor th it, which is used in virtually both single LOreal advertisement.To identify all the different products of the brands portfolio they utilize the same logo for all of their goods by adapting to the specific scope (LOreal homepage, 2012). Considering LOreals image of good appearance we decided to extend the brand by entering a new market with a new product. The diversification LOreal shoes should be placed in the customer products area with a tar crush group of professional women. The leather shoes should be available for middle to high income consumers. Though the price is affordable for this group of customers the quality is still high.With this strategy we want to cover the needs of the existing customers and authorize out for new potential clients. On one hand we intend to increase our sales and profits on the some other hand we use the good reputation of LOreal to get our new product connected to the values of the umbrella brand. To make sure that we created a new logo kee ping the handed-down LOreal letters with a reference to the shoe sector as shown in (image 1). Meanwhile, we forecast that LOreal shoes can strengthen the global brand in future.Image 1 Traditional LOreal letters mentioning the new sector Brief Literature Review Before putting theory into practice every company needs to consider its internal and external situation. In this part, three marketing theories will be applied to LOREAL. These are The Ansoff matrix, the jampack analytic thinking and the BCG matrix. Ansoff matrix is a model that helps firms to outline the range of marketing options open to them (Riley, 2012). LOreal shoes classified as a diversification was made harmonise to the Ansoff matrix.A diversification is described as a new product for a new market. LOreal added shoes to its existing product range, left the skin and hair care market and entered the new footwear area. Image 2 Ansoff matrix With the SWOT Analysis we could discover our strengths and weaknesses, and identify both the opportunities and the threats for LOreal. In other words, as Renault stated A SWOT is to reveal positive forces that work together and potential problems that need to be addressed or at least(prenominal) al funkyd.Comparing the strengths to the weaknesses for LOreal shoes we have to mention that the variety of suppliers and the competitive quality price relation of the product overweight the missing expertise in the shoe sector. The opportunity of using the strong image of LOreal and the fact that there are no other middle price shoes in our own umbrella brand product range can be used to attract new customers. Taking into account that the economic situation has changed and heap are not willing to spend as much as they did before the recession took place (Price, 2012).Using the BCG Matrix a company can recognize if a product is profitable or not. It can be helpful if a company has to decide whether investing additional resources in a accepted product or service s. There are four categories beated to the relative market share and market emersion rate star, cash cow, poor dog, school principal mark (Lu Zhao, 2006). A star is a product with a high market share and a high market growth rate. With this kind of product the company gains r purgeue. Therefore, a star can be used to declare weaker sectors. These products with a low market growth rate and a low market share are called poor dogs.Cash cows are well-established with a high market share but as the market growth rate is low the company has to be aware of limited opportunities. Those limitations do not exist for question marks as they are located in high growth markets with a low market share. These unknown new products like Loreal shoes do have the potential to establish and become stars or even cash cows. In future they could be able to promote weaker sectors and create a trade-off (Lu Zaho, 2006) I found another website to reference these two paragraphs From which website did yo u get this? gt According to the Inter realise Center for Management and Business Administration (2012) the BSG matrix is limited. The different products in a companys portfolio cannot be taken as independent they are related to each other. This has to be taken into consideration when it comes to the question whether you keep or you eliminate a product. Reflective Statement To develop the topic we firstly did some research just about the definition of brand extension and LOreal as a company.We discovered that creating a brand extension for LOreal is a difficult task as the umbrella brand already covers a lot of sectors in the beauty and care area. We thought about a product that would fit into the enterprises image of beauty and decided to choose shoes for middle-aged professional women. We looked into several marketing theories to support our decision such as the SWOT analysis, Ansoff matrix, and the BCG matrix. However, we discovered that The SWOT analysis is the most helpful theo ry for our research.Since LOREAL shoes classified as diversification, the SWOT analysis helped us to discover our brands current strengths and weaknesses as well as the potential opportunities and threats that we might find in the future. This made it easier for us to set our brands short term and long term goals. References Collett, S. (1999). Business Planning, E-journal of SWOT Analysis, 33(29), 58. Retrieved November 05, 2012, from http//jr3tv3gd5w. search. serialssolutions. com/ Hussey, D. (1999). Strategic Change, E-journal of Igor Ansoffs Continuing Contribution to Strategic Management, 8(7), 05.Retrieved November 06, 2012, from http//onlinelibrary. wiley. com/doi/10. 1002/(SICI)1099-1697(199911)87%3C375AID-JSC462%3E3. 0. CO2-U/pdf Kapferer, J. N. (2008). The New Strategic Brand Management Advanced Insights and Strategic Thinking. London Kogan Page. Keller, Kevin L. (2003). Strategic Brand Management. (2nd ed. ). Upper Saddle River, NJ Prentice Hall. Lu, H. & Zhao, L. (2006). integrate GIS AND BCG MODEL FOR MARKETING STRATEGIC PLANNING. 14(18), 02-04. Retrieved November 06, 2012, from http//iceb. nccu. edu. tw/proceedings/APDSI/2006/718-725. df Price, E. (2012). A reduction in European over-consumption will be undone by any Eurozone solution. Retrieved November 01, 2012, from http//blogs. lse. ac. uk/europpblog/2012/07/23/eurozone-over-consumption/ Riley, J. (2012). Ansoff Matrix. Retrieved November 07, 2012, from http//www. tutor2u. net/business/strategy/ansoff_matrix. htm Renault, V. (n. d. ). SWOT Analysis Strengths, Weaknesses, Opportunities, and Threats. Retrieved November 08, 2012, from http//ctb. ku. edu/en/tablecontents/sub_section_main_1049. aspx