Market Segmentation Paper Mike Harrison Henry Gonzalez Frank Gamboa Mike De Van University of Phoenix MKT 421: Marketing Group: SV 01 BSM 12 Dr. Thomas T. Co bianchi, D. B.
A. July 1, 2003 SWOTT Analysis of Dell Computers In order to swat the competition you need to understand SWOTT. SWOTT stands for Strengths, Weaknesses, Opportunities, Threats, and Trends. It is a way to analyze a company's or a department's position in the market in relation to its competitors. The purpose of the SWOTT analysis is to identify all the major factors affecting competitiveness before crafting a business strategy.
The understanding of market Segmentation is also something important we need understand. Market segmentation describes the division of a market into groups, which will respond differently to promotions, communications, advertising and other marketing mix variables. Each group, or "segment", can be targeted by a different marketing mix. The segments are created to minimize inherent differences between respondents, within each segment and maximize differences between each segment.
"The purpose of strategy is to be really clear before you take the direction. The point of a SWOTT analysis is to have the best shot at a grounded plan," says Rashi Glazer, co-director of the Center for Marketing and Technology at the University of California at Berkeley. Project leaders must consider opportunities and threats -- or customers and competitors. How attractive is the market or direction they " re considering? What's their market share and cost structure? Identifying opportunities was an easier task.
Dell looked at the marketplace and saw that customers increasingly valued convenience and one-stop shopping and that they knew what they wanted to purchase. Dell also saw the Internet as a powerful marketing tool. On the threats side, Dell realized that competitors like IBM and Compaq Computer Corp. had stronger brand names, which put Dell in a weaker position with dealers. Dell put together a business strategy that included mass customization and just-in-time manufacturing.
Dell also stuck with its direct sales plan and offered sales on the Internet. To analyze the strengths of a company, ask the following 5 questions. The answers will indicate the sources of strength. o What are the major sources of a company's revenue and profit? o What is the market share of the company in its various product lines? o Does the company have strong brands? o Is the marketing / advertising effective? o What is the major focus are of the company? Dell Computer Corporation designs, develops, manufactures, markets, services and supports a range of computer systems, including enterprise systems (servers, storage and networking products and workstations), notebook computer systems, desktop computer systems and software and peripherals.
DELL also markets software, peripherals, service, and support programs. For the 13 weeks ended 5/2/03, revenues rose 18% to $9. 53 billion. Net income rose 31% to $598 million. Results reflect strong net unit shipments across all regions, and lower selling and administrative costs.
The overall look at the strengths of this portion of the SWOTT analysis is very positive. The facts are seen quit clearly in the internal structure, but we now need to look at its weaknesses.