Company's Marketing Strategy example essay topic

Kalevala Koru Introduction The history of Kalevala jewellery went back to the Association of Kalevala Women who aimed to safeguard ancient Finnish culture tradition. Making-making was regarded by them as one way to honour national history and culture heritage as well as one way to raise funds for the Association of Kalevala Women. The name Kalevala came from the national epic because of its strong connection Established in 1937, Kalevala Jewellery started to produce jewellery in 1940. In 1940's, though facing difficulties of lacking raw materials and skilful workforce in production, the jewellery sold very well both at home and abroad partly due to the fact that demand exceeded supply, partly due to its attendances at jewellery exhibitions which enlarged its brand fame. 1950's saw the steady growth of Kalevala till 1960's, however modern jewellery gained an increasing market share at the same time. In the early 70's situation improved a bit then replaced by a sliding down at the end of the decade till the beginning of 80's when the Association had to give financial aid to help it out.

Then thanks to a change in fashion in the mid-80's, Kalevala won over new customers when young women wanted big, ethnic jewellery. The main product ranges of Kalevala were ancient and archaeological jewellery, historical jewellery and modern jewellery. Bronze was used as main raw materials to make jewellery, next was silver and then gold. Bronze jewellery contributed a large part of total production (70%). The silver and gold works accounted for 22% and 8% respectively. Almost the entire Kalevala jewellery range was available in both bronze and silver.

Every year over 400 models were being produced, of which most were available in various forms, like pendants, earrings, necklaces, brooches, rings for girls and tiepins and cuff links for men. The production process was so labour-intensive that in 1996 85 out of 143 employees worked for production section. With the joining of new CEO, Kalevala stepped into a new stage. By motivating employees, investing in production machines and R&D, focusing on three market segments which targeted young women, working women and loyal users and improving customer services which included re-adjusting salesmen' attitude towards retailers, automating administrative work, adapting to a changing environment, Marja Usvasalo managed to achieve best performances in the period from 4/1995 to 3/1996 with profit increased greatly by 39% compared with previous year though it had to be reaffirmed that from 1988 till 1996 period the corporate performances had been improving. However the period of 4/96 to 3/97 saw a sharp decrease in profit by 16% compared with last year and operation profit went down 27%, in the meanwhile the personnel increased 12% from 143 to 160. SWOT analysis in the next part will be given to identify the main problems facing with the company by explaining the strong points, weaknesses, opportunities and threats and then recommendations will be provided to try to figure out the solutions.

SWOT ANALYSIS: Strengths Kalevala kor u company, have different strength points enabling it to be a successful company to a certain extent, from which we can mention the following: 1. The company was able to connect its' designs to the Finnish culture successfully in a way of honouring and respecting the legacy and traditions of past generations. 2. The brand image of the company, as well as, the reputation was very strong. 3. They were able to promote the brand by donating the products as gifts to (well-known) ladies inside and outside Finland, such as, first ladies in each country or to royal families.

4. The company has a strong design management through direct contact with famous designers; Stefan Lind fors for example. 5. Good customer orientation: which was one of the major cornerstones in the company's new marketing strategy, aiming to concentrate on different customer segments (rather than focusing only on women of 60s). 6. The company's marketing strategy has a very good focus on retailers, and direct marketing to them.

7. They were able to build high brand loyalty among big number of customers. 8. The members of the "Kalevala Koru Association" have a strong influential network. Among those members was the wife of the president, wife of the minister, and a member of the parliament. 9.

The company manufactured a wide range of products and designs to satisfy the variety in tastes and preferences among their customers. 10. Good management system in terms of employee motivation through paying bonuses based on sales and production figures in order to keep high job satisfaction. They were also good in terms of introduction of the automated administration system, from which they were able to minimize paper work, therefore, increasing the efficiency of distribution, production and storing processes.

11. Strong financial situation, in which no bank loans and financial burden took place. 12. Efficient distribution process and channels, through fast delivery to retailers, as well as a 400 jewelry shops all over Finland. 13. Acquisition of "Kaun is Koru Ltd".

Which enabled them to gain more competitive advantage in modern jewelry design. Weaknesses 1. The Kalevala Koru did not have a separate marketing department. The CEO made most of the marketing decisions.

She also took an active part in planning the advertising campaigns. However, as a CEO, Usvasalo should have much time to focus on top management. It's better for the company to set up a marketing department to do marketing research and deal with marketing affairs. 2. The Kalevala Koru did not successfully target at a specific segment. The CEO based her marketing strategy on three segments: Young people, working women and loyal users.

However, the company did not position products in the mind of this consumer group. It provided products for women of all range of ages. 3. The Kalevala Koru has not successfully developed its overseas markets. First, it focused more on its brand image than on its product details in developing abroad markets.

Second, as the worldwide fashions changed, more and more people seemed to prefer jewelry made of silver and gold. The most important point is that Kalevala Jewelry symbolized Finnish culture and may be not favoured by overseas customers who are not familiar with Finnish culture. Opportunities 1. As the economy grows, the consumption power becomes stronger and stronger. People are more likely to buy what they like and the potential markets thus become larger and provide good opportunities for the company.

2. Since the company did not successfully target the markets, there are more potential to segment the men and working women markets. The men market is a new market in which the company may find good profitability if it position products in the mind of men early. It also should position products specially for working women which are able to make their purchase. 3. The overseas markets provide many opportunities if the company position differentiated products for different markets.

4. Emphasis on Finnish identity concern may attract more Finnish people and foreigners who are interested in Finnish culture and history. Threats The company has competed in the designed product industry which the competition intensity in the market is relatively high as this market has wide-ranges of substitute products, strong rivals and low barriers of entry. Moreover, the individual favourite is the main factor influence buying designed products so the different groups of customers will have various preferences. Problems During the early 1990's, the operation result of Kalevala Jewelry outperformed the competitors and the jewelry market with average sales growth rate at 34.5% and then drop to only 5% in 1996. Moreover, in the same year, the operation and net profit margin decrease significantly from 27.78% and 18.85% to 19.35% and 15.05% sequentially.

With these figure, it can be implied that Kalevala Jewelry had problems doing business. Form our analysis; we can identify further problems as follow. The company had segmented the market into three segments and chose to penetrate every segment but failed in reaching the working women segment which was the highest potential group because the company applied the same marketing strategies with every segments which had different characteristics and requirements. Moreover, as company's advertisement more focused on creating brand image than promoting the products, the research result had shown that only 10% of population could distinguish the real brand product from the copies. However, in overseas market, the company faced with problems about low brand recognition and unpopular in bronze jewelry. As a result, company's percentage of export was significantly lower than competitor's.

Recommendations After analyzing the situation and problems of Kalevala Koru, there are some effective solutions and recommendations that can minimise the problems mentioned above and hence develop a thriving business for Kalevala Koru not only in the domestic market but also in the international markets. Although Kalevala Koru had a steady growth in their turnover during the last decade of the 20th century, their profit decreased to FIM 12.6 million. This unexpected financial performance may result from the inefficiency of marketing. Establishing a professional marketing department is essential and recommended to Kalevala Koru since they need more specific marketing strategies to target each potential market segment, such as men group with disposable income and working women and aim to become a marketing-oriented corporation to create a prosper business.

In addition, in order to fight off the copied problem of products which have lessened Kalevala Koru's profits, Kalevala Koru should implement a more strong action to seek and then cooperate with a professional law organization to protect their brands and products more effectively. International markets possess huge profits and opportunities for Kalevala Koru to create a new successful stage for their company. However, the understanding of diverse cultures and life styles as well as different customers' tastes is vital for multinationals when they expand their business in other countries. Kalevala Koru should implement a more focused market research for each international market to understand the culture and demand of local customers, and hence create unique and appropriate products to each market instead of products with Finnish characteristics. Furthermore, different international markets and customers require differential methods of promotion. Kalevala Koru need to focus on this diversity and promote their products (not only their brands) with precise and applicable methods and then modify their strategies according to the changeable environment in international markets to keep themselves in an advantageous position in the long term.