Maria Savushkina

Student ID 13031
February 28, y

BA 150 Marketing.
Midterm

Nike.
1. What are the pros, cons, and risks associated with Nike’s core marketing strategy?
From the case, we can see, that Nike’s core marketing strategy is its belief in a “pyramid of
influence” in which the preferences of a small percentage of top athletes’ influences the product
and brand choices of others.
“The Influence Pyramid” is a conceptual framework for building outreach strategies to
communities online and off.  It helps you define a methodology and
an architecture to target your content and media efforts.
The Influence Pyramid is designed to help you dissect and
understand your community.
Today, much of your budget, time, effort and
energy is spent speaking from the top of the pyramid
directly to the bottom of the pyramid. For
example, you might place an advertisement
in a consumer publication or a trade mag
designed to motivate potential consumers
of your product to make a purchase. In today’s world, the Influence Pyramid helps to stratify the
universe that manifests itself between you and the consumer. There are two, essential layers,
between your brand and the consumer today.

Digital Influencers make up a tiny portion of your audience; however, they are the most
powerful and, yes, influential part of the marketplace. Digital Influencers create content. They
may be influential bloggers or even members of the press. They are active in your community,

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speaking at events, attending trade shows creating podcasts or video blogging. The Digital
Influencers consume all of your content. Every little drop. Why? Because they must follow your
every move to remain credible in the marketplace. The Digital Influencers are thought-leaders.
Prosumers make up about 6-7% of the entire market for your products or services. These
community members are very active in the community meaning the post questions on forums
and enter contests and competitions. They generate content on an infrequent basis on third-party
platforms. Prosumers are the inspiration for much of the content created today by the Digital
Influencers. Prosumers write reviews on products, letters to the editors of magazines and online
publications, comment on blog posts.

Many Prosumers end up being the next generation of Digital Influencers. Prosumers look
to today’s Digital Influencers to help them curate the steady flow of information and content.
They are looking to the marketplace for the right information to consume. They may not have the
time to try everything in the marketplace, but they will consume the relevant information
compiled, contextualized and created by the Digital Influencers they respect.

This core strategy has allowed Nike to stay above the competition and to be very successful
over the past. For example, in the first year, in 1985, when Nike signed up then-rookie guard
Michael Jordan as a spokesperson, he personified superior performance. As a result, Nike’s bet
paid off, the Air Jordan line of basketball shoes flew off the shelves and revenues hit over $100
million in the first year alone. Another excellent example of the effectiveness of this marketing
strategy for Nike -- its participation in the 2008 Summer Olympics in Beijing whereby some
believed that Nike’s marketing strategy was more effective than Adidas’s Olympic sponsorship.
Another advantage of this marketing strategy is that it has allowed Nike to build a strong
brand and also expand that brand overseas. As a result of affiliating its brand with top athletes,
Nike has been able to attract a wide range of consumers, in particular, athletes. For example,
when Nike expanded overseas to Europe, to build authenticity among the soccer audience,
consumers had to see professional athletes using its product, especially athletes who won.

Nike’s big break came in 1994 when the Brazilian team which is the only national team for
which Nike had any real sponsorship, won the World cup. That victory transformed Nike’s

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image in Europe from a sneaker company into a brand that represented emotion, allegiance, and
identification. It also helped launch Nike into other international markets over the next decade,
and by 2003, overseas revenues surpassed U.S. revenues for the first time.
In addition to expanding the brand overseas, Nike successfully entered new athletic
footwear, apparel, and equipment product categories by using endorsements from high-profile
athletes and consumer outreach programs.
For example, in tennis, Nike has collaborated with Maria Sharapova, Roger Federer, and
Rafael Nadal to push its line of tennis clothing and gear.
Nike’s core marketing strategy has allowed it to form partnerships and thus create new
chains of stores.
For example, Nike formed a partnership with Foot Locker to create a new chain of stores,
House of Hoops by Foot Locker, which offers only basketball products by Nike brands such as
Converse and Jordan.
We can see, that this marketing strategy has allowed Nike to retain a significant percentage
of market share.

For example, Nike’s lead in the running category has grown to 60 percent market share as a
result of its exclusive partnership with Apple. Overall, it appears, that this marketing strategy has
allowed Nike to reap many benefits and maintain a healthy market share.

On the other hand, while this core marketing strategy may have worked in the past, there is
no guarantee that future athletes will command such influence in the future. It is possible as
people’s needs and preferences change over time. There are many factors, that can influence the
changes in taste.
For example, if a person’s income becomes less, he/she may no longer see the purpose of
buying expensive sneakers, only because it is affiliated with a prestigious athlete.

As a result, Nike may eventually need to implement a different marketing strategy such as
a holistic marketing concept which is based on the development, design, and implementation of
marketing programs, processes, and activities that recognize their breadth and interdependencies.

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 Another risk associated with this marketing strategy utilized by Nike is that athletic
influence could be adversely affected by the actions or inactions by Nike’s chosen
spokespersons.
For example, as we can see from the case that Runner Steve Prefontaine, the first
spokesperson, had an irreverent attitude that matched the company’s spirit. However, if this
attitude were to change in the long-run, then the overall success of Nike will be adversely
affected, and the company may need to look into utilizing another marketing strategy to keep its
business in operation.

A disadvantage surrounding this marketing strategy is that it disregards the commitment of

the company to sustainable development.
From the case, it can be seen that although Nike is trying to make its company and products
more eco-friendly, it does not promote its efforts. Nike executives agree that promoting an eco-
friendly message would distract from its “slick high-tech image," so efforts like recycling old
shoes into new shoes are kept quiet.

Nevertheless, Nike can consider this as an alternative marketing strategy, that will enable it
to maintain its market share. Consumers will see Nike, being a good corporate citizen and
regarding its commitment to social responsibility.
The best choice would probably be social responsibility marketing in which Nike would
need to consider the ethical, environmental, legal and social context of its role and activities.
Overall, Nike’s task would be to determine the needs, wants, and interests of target markets and
satisfy them more effectively and efficiently than competitors.
Another disadvantage is that this marketing strategy may cause Nike to disregard other
important factors that need to be considered such as shaping the market offerings,
communicating value and creating long-term growth.
For example, since Nike spends tons of money on utilizing top athletes to market its
products, it may overlook the product quality, design, features, and packaging. Generally, it
appears from the case that Nike has nevertheless been quite successful over many years and is
the top athletic apparel and footwear manufacturer in the world.

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 2. If you were Adidas, how would you compete with Nike?
If I were Adidas, I would emphasize my “international” scope of producing great soccer
shoes and could also extend my marketing to emphasize my “everyday&everyone” usage for my
products.
I’d look into rebranding the Adidas image as a lifestyle shoe company. I would make this
possible by creating a strong brand based on high quality, innovative products, that top athletes
choose to use in training and competition.
For example, create a premium brand but target it to young people, women and others who
are into fashionable shoes.
I would also compete with Nike by focusing on marketing efforts at large sporting events
on key products. For example, when an athlete/team wins, I would immediately inform
spectators about the Adidas shoes, that they were wearing, and attribute part of the victory to the
Adidas shoe. This way, Adidas can gain recognition as providing the winning athlete/team with
the shoes, needed for success but also marketing to the consumer a specific Adidas product.

Another way in which I would compete with Nike is by focusing on emerging markets. An
emerging market is a country that has some characteristics of a developed market but does not
satisfy standards to be termed a developed market. It includes countries that may become
developed markets in the future or were in the past.

For example, emerging markets in Asia or Latin America can give Adidas significant
leverage over Nike.
Also, creating a point of difference for Adidas vs. Nike is key to a sustainable advantage.
Adidas soccer shoes, for example, are a good starting point to differentiate one brand versus
another.

Cisco.
1. How is building a brand in a business-to-business context different from doing so in
the consumer market?

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 Building a strong brand of a company is always important to work. There are
two fundamental ways to do business as Business-to-Business (B2B) and Business-to-
Consumer(B2C).

The ways branding has to perform similar tasks. However, depending on the target
audience, the company will now have to decide to brand.

B2B companies are supportive enterprises that offer the things other businesses need to
operate and grow. These include businesses like payroll processors, for example, or industrial
suppliers. It is in contrast to business-to-consumer (B2C) models, which sell directly to
individual customers, and consumer-to-business (C2B) models, in which an end user creates a
product or service for a business. Instead, B2B companies offer the raw materials, finished parts,
services or consultation that other companies need to operate, grow and profit.

In cases where customers are consumers, i.e., the case of B2C, customers usually an
individual who directly decides to buy products and services. As such, branding strategy will aim
to target customers are this individual. Depending on each product and service, the company will
build a brand to impress the customers.

In the case of CISCO, individual customers are usually young people, who love technology
and creative marketing strategies must be consistent with this object. CISCO has links with the
sporting goods to a targeted audience and has made specific achievements. More complex in the
case of a business customer, i.e. the case of B2B, because this time, the client is a group
consisting of: the proposed products and services, the evaluation of products and services, the
decision to purchase products and services. As such, the branding strategy is the overall strategy,
direction to customers that all of their business to know and understand the product and its brand.
In particular, the promotion of this strategy must be concise, avoid boring because customers do
not have much time to watch the trailer length but not excellent.
For B2B branding, customers need time to understand the brand. The customer is the
business, is professional buyers so they know more about demands and goals of buying the

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product, so they will focus on products that will help them achieve efficiency in business, such
as increased revenue, reduced costs with excellent service.
Since 2006, Cisco has implemented a campaign to increase the value of their brand aimed
at IT decision makers of the companies, and they have early success. Since 2012, in the Vietnam
market, IBM Corporation has developed a holistic brand towards customers businesses and
organizations in Vietnam. They have built an advertising program includes measures to create
modern life while delivering high social responsibility, make a better life with the slogan: "For a
smart world more." End trailer about 2 minutes on TV is saying "WE ARE IBM.”
2. How Is Cisco’s plan to reach out to consumers a viable one? Why or Why not?
Currently, Cisco is using strategies to approach consumers in an integrated way.
The company exists in a broad network of relationships that form an ecosystem. These
relationships are not just with customers, but also with suppliers, distributors, retailers, industry
associations, institutional partners, and government agencies. You can tap into this ecosystem to
engage your customers in ways that go beyond what has been relevant to your business
relationship in the past. A broad ecosystem can provide data on your customers' interests, thereby
opening up ideas for new product and service offerings and growth opportunities.
Using the ecosystem is different from managing a value chain. You develop partners that
can help spur innovation and more venues for going to market. They might also help win new
customers for you by endorsing your brand.
Developing brand ambassadors is crucial to this approach — including some who work
directly for you, some who work for other companies in your ecosystem, and still others among
your customers.
Cisco bought the small company, operating in areas where Cisco wants to enter, such as
Linksys, to merge into corporate and develop this sector. This strategy has brought the initial
success for the corporate. However, this strategy also has risks such as cultural conflict within
the corporation; the corporate investment spread, lack of depth; the corporate will have to face
strong competition. In the future, this strategy will be feasible if Cisco is the limit this risk, by
selectively to M & A*, investment in key areas, creating high competitiveness in its field.
In Vietnam, the past years, many corporations have thrived through M & A, but unfocused,
leading to spreading investment, lack of depth, inefficient operations. Typically as Vinash in
Group. They did not focus on investing in its primary industry is ship building that investment

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spread to the financial sector, real estate and so inefficient, on the brink of bankruptcy. Currently,
after the government guaranteed debt, the Group is restructuring, and hundreds of thousands of
workers lost jobs. The Group owed millions of dollars from domestic and foreign partners.

*Mergers and acquisitions (M&A) is a general term that refers to the consolidation of companies or assets
through various types of financial transactions. M&A can include many different operations, such as mergers,
acquisitions, alliances, tender offers, purchase of assets and management acquisitions.

Walmart.
1. Evaluate Walmart’s new marketing campaign and tagline. Did the company make the
right decision to drop “Always Low Prices? Always.” as a tagline? Why or why not?
According to the Case, the target line “Always Low Prices. Always” was published in
1992. Walmarts new marketing campaign and tagline, Save Money&Live Better is indeed an
excellent move for Walmart as a means of repositioning its brand and regaining its market share.

We can see from the case, that from 2000 to 2005, Walmarts stock price fell 27 percent and
remained low from 2005 to 2007. Hence, taking this great initiative in 2007 as a means of
rejuvenating the company was indeed a great idea. With this new tagline, the company focused
on decreasing energy costs, increasing retirement savings, good employee health care coverage,
and increased family savings.

Previously, the company was faced with multiple lawsuits from employees who
complained about poor work conditions, exposure to health hazards and pay below minimum
wage, which left employees with families below the poverty line. The company needed to
immediately address this issue which was made possible by introducing a new marketing
campaign and tagline and thus, a new focus.
I’ve read, that nobody’s more committed to helping family budgets go further than
Walmart. Walmart saves the average family about $3,100 a year, no matter where they shop.
This new marketing campaign also enabled Walmart to attract new customers affected by the
recession. It used several initiatives to accomplish this goal such as slashing prices on popular
toys and electronics during the holidays and also implemented a massive store remodeling effort
called Project Impact.

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 2. Walmart does very well when the economy turns sour. How can it protect itself when the
economy is on the rise? Explain.
Walmart can protect itself through a few strategies.
First of all, they can start by building a wider product portfolio. Walmart can try to bring in
more products. More products that are offered — more customer base that can be captured. With
the existing products, Walmart can add on more varieties for their customers to choose from.
Paying attention to the market wants and needs are essential for a company where its primary
customers are the average users and consumers.

Walmart can offer the products with different price range so their customers can choose
even though the products they are offered are already cheap. Many people assume that they do
not have the opportunity to choose because they are depending on the price of the products.
Walmart can offer and allow their customers to choose from. This action helps them to build
stronger customer loyalty.
Customer Loyalty — Consumers have varying degrees of loyalty to specific brands, stores,
and companies. Oliver defines loyalty as “a deeply held commitment to rebuy or repatronize a
preferred product or service in the future despite situational influences and marketing efforts
having the potential to cause switching behavior.”
Examples of brands in Customer Loyalty: Apple, Clairol, Samsung, Mary Kay, Grey
Goose, Clinique, Walmart, Amazon, Google, AT&T, Discover Card, Barilla, Canon, Nike, Acer.
Through the customer loyalty, Walmart will able to secure a better and stronger
relationship with customers. Customer loyalty in the retail field is rather vital as they rely on
customers to provide them with a market to provide for and also they have to depend on the
customers when there is a fall in the economy where customers are the ones enabling them to
sustain. Without customer loyalty, they will not be able to maintain for a long time, regardless of
their marketing strategy and also the price of their products.

Intuit.

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 1. Elaborate on Intuit’s use of customer research. Why did it work so well for the
company?
We define marketing research as the systematic design, collection, analysis, and reporting
of data and findings relevant to a specific marketing situation facing the company.
The Marketing Research process consists of 6 steps:
1. Define the Problem, the Decision Alternatives, and the Research Objectives
2. Develop the Research Plan
3. Collect the Information
4. Analyze the Information
5. Present the Findings
6. Make the Decision
Marketers collect primary data in five main ways: through observation, focus groups,
surveys, behavioral data, and experiments.
Intuit spends a significant amount of time and money on consumer research each year, and
they state that it is “critical for Intuit to know exactly how customers use and feel about their
products” because of the nature and pace of technology, the shifting customer and consumer
needs, and the competitiveness of the industry.
Intuit has many market research approaches that include observational research like site
visits or lab studies, and survey research such as its remote studies to keep pace with the
consumer.
The customer research worked so well because Intuit analyzed the information, used it to
improve and better understand its customer. Without being so engaged with customers through
its market research, Intuit might not have been so successful.
2. Could anything go wrong for Intuit now that it has beaten out Microsoft? Why or why
not?
The victory against Microsoft could be a big win for Inuit. So far, they have done well with
their marketing research efforts, and as long as they continue, they will be fine. However, like
every company, there might be outside financial pressures to increase stock prices.

3. How should Intuit gauge the results of its research among younger consumers with
mobile devices?

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 Expanding its mobile solutions will attract younger consumers to Inuit. Intuit can gauge
research of its younger consumers similarly to how it classified the viral success of its sites.
Identifying each blog post according to velocity, a share of voice, voice quality, and sentiment
were integral in understanding and interpreting the results.

Tesco.
1. What’s next for Tesco? Where and how can it grow? Whom will it target?

It should focus on a market research approach so that they can receive more information
about customers’ preferences. However, their next step should be implementing better quality.
Tesco should continue to provide additional convenience to consumers through the
diversification of their goods and services. Tesco can grow through their loyalty reward cards.
As indicated in Tesco’s ‘Strategic Report 2016’, the company’s overall revenue had
dropped in last year. Also, one of the new shows that Tesco closed 200 stores and canceled 50
superstore openings after £6.38bn loss. In addition to that, the company’s European market share
fell in 2015 (European markets mixed with Tesco leading London shares lower, 2015). So, they
should give up opening new large stores and focus on multichannel retailing.

As a first step, Tesco should increase it's quality and market share again. They can improve
the Loyalty Card program and can attract more customers. One of the most critical thing that
Tesco need to do is increase international sales. To achieve this, Tesco should aim to be
successful in other overseas countries as much as in the United Kingdom. The company should
continue researches about customer satisfaction and maybe research other countries in detail.

So, they can increase their market share again and aim to be an outstanding retailer. On the
other hand, the company can improve its reputation with social responsibility projects. Also, as
the company indicated at ‘Strategic Report 2016’, Tesco can aim to reduce the food waste to
increase revenue.
2. How can Tesco take its customer loyalty programs to the next level?

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 Tesco can take its customer loyalty program to the next level by concentrating more toward
marketing research and linking consumers behavior towards different services. By researching
more about their customers' behavior and satisfaction, Tesco can create a better profile to
understand the needs and trends. The company can create new digital payment methods to
increase shopping. Also, the company should not change the price frequently. Because, as the
Tesco’s customer needs research, one of the main themes is more stable prices that customer can
trust every time.
Last, the company should more consider about its feedback channels and customers’
request.

IKEA.
1. What are some of the things IKEA is doing right to reach consumers in different
markets? What else could it be doing?
IKEA is doing many things right to reach its consumers in different markets, which is why
they have been so successful.
Good quality for a reasonable price. An underlying reason is a simple fact that their prices
are virtually impossible to beat. The revolutionary idea of selling items that need to be assembled
allows for cheap transportation costs resulting in an even lower overall price. Being able to have
more shelf space in stores and being able to distribute their products more efficiently allows for
IKEA to reach out to the entire world.

IKEA’s revolutionary idea to outsource its suppliers, not just from a handful of countries
but also from fifty-three countries with roughly 1,300 suppliers, also allows for such cheap
products.
Brand awareness — brand awareness refers to the extent to which customers can recall or
recognize a brand. Brand awareness is a critical consideration in consumer behavior, advertising
management, brand management, and strategy development. The consumer's ability to
understand or recall a brand is central to purchasing decision-making. Purchasing cannot proceed
unless a consumer is first aware of a product category and a brand within that category.
Awareness does not necessarily mean that the consumer must be able to recall a specific brand
name, but he or she must be able to remember sufficient distinguishing features for purchasing to

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proceed. IKEA’s success stems from its uniform look, all of its stores are in a box-like shape (far
away from the city) and are blue and yellow. It allows consumers all over the world to be able to
locate an IKEA with just a blink of an eye — this is necessary brand awareness. The final
fundamental way that IKEA reaches consumers in different markets is by adhering to local
tastes. Employees of IKEA travel around the world and visit different households to compare
and contrast the lifestyles of consumers’ worldwide. It allows for IKEA to understand what
people in the UK like as opposed to what people in the US like. Knowing the difference in
preference gives IKEA the upper hand by allowing them to adhere to the lifestyle in each country
and putting those products in their stores.

IKEA could be more successful if it lowered its profit margin; it has the highest profit
margin of 10% out of its competitors, which range from 5-7%. If IKEA reduced its profit
margin, it could reinvest that money into making higher quality products, put more money
towards R&D and marketing, or even expanding into more countries.

2. IKEA has essentially changed the way people shop for furniture. Discuss the pros and
cons of this strategy.
Changing the way that people shop has both pros and cons.
Cons:
• Just as Disney, people don’t necessarily like to stray away from what they know; it may
set people off.
• The store layout may deter people from enjoying shopping there. People most of the time
want to be in and out of the store, whereas with IKEA you must walk through the entire
building before checking out.
Despite the cons, there are pros to IKEA’s revolutionary shopping experience.
Pros:
• The set up of the store makes it, so people don’t have to lug around big heavy items
throughout the entire store. IKEA’s layout allows for people to see what the product will look
like in their home yet they only have just to take down a name and a few numbers and pick
them up once they have completed their shopping. It creates a constant flow throughout the
store, turning one of their weaknesses into strength.

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 Accenture.
1. What has Accenture done well to target its B-to-B audience?
B2B companies are supportive enterprises that offer the things other businesses need to
operate and grow. These include businesses like payroll processors, for example, or industrial
suppliers. In contrast to business-to-consumer (B2C) models, which sell directly to individual
customers, and consumer-to-business (C2B) models, in which an end user creates a product or
service for a business. Instead, B2B companies offer the raw materials, finished parts, services or
consultation that other companies need to operate, grow and profit.

Accenture has done very well in targeting its business to a business audience. It has done so
by targeting companies with high future potential. Technology-driven companies worldwide are
generally the fastest growing and most profitable entities or “business sectors with the greatest
growth prospects, most profitable customers, and most promising opportunities," which is
Accenture’s target audience.
Once Accenture identified its target audience, it acquired 99 of the World’s Fortune 100
companies, meaning their focus was successful. They’ve successfully overcome competitors
such as McKinsey and IBM by bridging the gap between those two service industries, offering
both business consulting and outsourcing implementation.
With a smart brand transition from its father company and inspiring slogans accentuating
its emphasis on success and the future, Accenture has impressively directed itself to potentially
successful technology-driven companies.

2. Has Accenture done the right thing by dropping Tiger Woods as its spokesperson?
Discuss the pros and cons of its decision.

Pros: Initially, Tiger Woods was an excellent face for the Accenture name because he was
a well-known model of success in the golf world, which is quite a transitive playing field in the
world of business.

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 Cons: After the Tiger Woods scandal was revealed, he became a negative representation of
the Accenture brand.

Based on potential “vendor analysis” used in supplier selection, supplier reputation can be
a significant reason for choice, almost as much as price and reliability. Vendor Analysis can be
defined as the assessment of weaknesses and strengths of prospective and current suppliers
concerning their – availability of capable staff, business model, capacity, sales revenue, stocks,
reputation, mark-ups, mark-downs, gross margins, quality, service, reliability, pricing policies,
payment terms.

Pros: By ending his contract with Woods as the face of the company and reinventing itself
using a non-offensive campaign, Accenture was able to re-establish itself as a trustworthy entity.
Cons: However, by ending the contract with Woods, Accenture lost its association with the
golf identity, potentially losing its association with a commonly used business tool.

HSBC.
1. What are the risks and benefits of HSBC’s positioning itself as the “World’s Local
Bank”?
The position such as a World’s local bank would help HSBC to attract huge customers in
different global markets that would also enhance its financial earnings and related strength
and ensure its commercial success in the banking industry. However, there are several risks
with this position to HSBC because it would require substantial financial budgets to conduct
financial activities in a global market that may reduce its profitability. For example, HSBC
gives the smart card to students with no-frills credit that attracts middle and needy students to
consume its products and services, but it also causes the negative impacts over the
profitability of HSBC in a corresponding manner. Due to the differences in culture, HSBC
could face negative and irrespective behavior from the side of consumers because of the gap
between social classes.
7. Does HSBC’s most recent campaign resonate with its target audience? Why or why
not?

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 Yes. HSBC’s recent ad campaigns resonate with the audience all over the world. HSBC
ensures that they reach out to the local communities in every country with their brilliant ‘World’s
Local bank’ branding. Their recent ad campaign called ‘Different Values’ continued on the same
lines. It aims to showcase the cultural differences amongst people and the possibility of them
having their individual opinions and points of view. Instead of viewing these differences as a
problem, the ads claim that HSBC sees a ‘potential’ of diverse cultures and minds in them.
HSBC is the world’s 4th largest Bank, HSBC is known as the “world’s local bank.” This tagline
reflects HSBC’s positioning as a globe-spanning financial institution with a unique focus on
serving local markets. Global product line includes HSBC direct, HSBC net, HSBC Advance,
HSBC premier HSBC's ideology of the world's local bank positions the company as one that
cares. Their recent ad campaign called ‘Different Values’ was a huge success. It aims to
showcase the cultural differences amongst people and the possibility of them having their
individual opinions and points of view.

Procter & Gamble.

1. P&G’s impressive portfolio includes some of the strongest brand names in the world.
What are some of the challenges and risks associated with being the market leader in so many
categories?
P&G adopts a multi-brand approach a portfolio of over 300 brands, with 25 brands making
over US$1billion in annual sales in 2012, but it faces many key challenges.
It uses a multi-brand strategy; there are drawbacks: with this multi-brand strategy, one
brand could easily affect another through association. A scandal relating to another P&G brand
could undo all the excellent customer relationships built by another brand with a customer. It is
potentially disastrous because if one or more of P&G’s brands erode significantly, their financial
status and market positioning will be adversely affected.
As the market leader, consumers pay closer attention to the company as such, mistakes
committed by the company would usually gain more negative publicity.
Lack of price sensitivity also hampers the company’s long term growth, since a growing
middle class might not be willing to spend on premium household products despite higher
disposable incomes, with cheaper local alternatives available.

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 Consequently, P&G has lost its customers in developed countries like Europe to cheaper
and equally capable products made by rivals such as Unilever. As such, competitors have gained
significant market share with more successful innovations and improved their market
positioning, threatening P&G’s market leadership.
2. With social media becoming increasingly essential and fewer people watching traditional
commercials on television, what does P&G need to maintain its strong brand images?

P&G uses the major social media sites Facebook, Youtube, and Twitter. It has only a minor
presence on other sites such as Pinterest and Google+. Also, none of the Chinese places are used,
despite China being a big market for P&G, and that the Chinese have no access to the three sites
due to the government ban. Therefore, P&G has to channel more resources towards the other
major sites such as Google + as well as Chinese sites to achieve enough reach.

A more subtle method involves P&G organizing campaigns that help to improve society as
a whole and to publicize them on social media. It will also help strengthen its brand positioning
based on beliefs and values, adding the element of caring for society.

It can consider having separate social media groups to deal with other significant market
segments. For instance, it can have a group to handle the male market for brands.
Currently, there is no official avenue for customers to voice their complaints on the
website. A solution is to develop forums in social media sites where users can share their product
experiences, write reviews and ask questions.

3. What risks do you feel P&G will face going forward?

As a multi-national corporation (MNC), P&G faces many potential risks as it moves
forward.P&G has significant international operations, and especially since the markets with the
most growth are overseas, they face many potential threats such as compliance with foreign
country regulations, foreign currency fluctuations.

Another potential risk that P&G would face would be the economic recession. It would be
brought down the discretionary income of family households and depressed citizens spending

MARKETING. MIDTERM 17
power, especially the middle class. It results in a switch from mid-range to lower end products, a
range which P&G does not have, thus detrimentally affecting its profits.

P&G often does brand-extension, and they must be careful not to have a new product
“flop," or it may adversely affect the original outcome.

Other heavy-weight MNCs, such as Unilever, have also started to jump on the emerging
market, leading to intense competitive rivalry in these markets. The degree of substitutes for
household items such as razors and shampoo is thus high with multiple MNC’s selling the same
thing.

Louis Vuitton.
1. How does an exclusive brand such as Louis Vuitton grow and stay fresh while retaining
its cachet?
The very name Louis Vuitton makes me think of luxurious fashion accessories made of the 
most excellent quality, champagne, and money. Their products are for the rich and famous or at
least the very wealthy consumers. The niche is the very most exceptional
quality. So as long as they continue to produce as they have in the past,  will ketoep having
the following that they currently have. The LV monogram stands for the most exceptional
quality.
“Celebrity branding” is a form of an advertising campaign or marketing strategy used by
brands, companies, or a non-profit organization which involves celebrities or a well-known
person using their social status or their fame to help promote a product, service or even raise
awareness on environmental or social matters. Marketers use celebrity endorsers in hopes that
the positive images of the celebrity endorser of the brand will also be passed on to the products
or the brand image associated with the celebrities.
Examples of successful celebrity branding campaigns:
• Chevrolet ft. Ian Somerhalder, Alec Baldwin, Nikki Reed, Norman Reedus, and Olivia
Wilde
• Calvin Klein ft. Justin Bieber
• GUESS ft. Camila Cabello

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 • Toyota ft. ‘Back to the Future’
• Diet Coke (Coca-Cola) ft. Taylor Swift
• H&M ft. David Beckham
• Dodge ft. Will Ferrell
• Weight Watchers ft. Jessica Simpson
As far as staying fresh Louis Vuitton has brought in young designers and artists to revitaliz
e their image to attract younger buyers, although it still maintains the classic styles. The compan
y has used several high profile models, celebrities, billboards, ads,  to market the products, such
as Jennifer Lopez, Keith Richards, Madonna, Sean Connery, Matthias Schoenaerts, Angelina
Jolie, Gisele Bündchen, Mikhail Gorbachev, Sophie Turner, David Bowie, and Emma Stone.

Louis Vuitton has had many collaborations with prominent artists and designers:
• Takashi Murakami created special edition collections, such as the Monogramouflage
Collection, which debuted in 2008, and a previous collection, released in 2002, which featured
some of his artwork.
• Most recently, Jacobs teamed up with Yayoi Kusama to create the "Infinitely Kusama"
Collection, which features bold colors of dots over the leather or the monogram canvas.
• In 2017 Louis Vuitton collaborated with American streetwear brand Supreme (brand),
releasing products in various pop-up stores in major cities around the world. Items feature the
Louis Vuitton monogram canvas mixed with the Supreme box-logo design.
• Also in 2017, Louis Vuitton collaborated with artist Jeff Koons.
The standard quality remains the focus to make sure there are no imperfections with their p
roducts,
and you can order personalized engraving on several of the products. The pricing remains solid,
and they do not offer reductions in pricing although there are many outlet stores selling items tha
t may be the counterfeit items. LV is also starting to expand into other countries with growing m
arkets, which will even further help LV stay fresh while retaining its cachet.
Louis Vuitton, an iconic luxury handbag and accessory company, is known for its
exclusive, prestigious and high profile brand that continues to maintain and develop this image
further while staying relevant and competitive. While battling its possible competition in
counterfeiters, which dilutes its brand image, Louis Vuitton uses specific tactics to redeem and

MARKETING. MIDTERM 19
reinvent its position in the market. The main competitor among its market is its counterfeit
product that the company counters with lawyers and investigative teams. The company upholds
its competitive advantage by relying on the backbone of its points of difference: their impeccable
quality and innovative fashion, which positions the brand as being “desirable, deliverable and
differentiable."

In recent campaigns, the company realizes market leverage by using celebrities with
developed brands of their own. Such personalities represented markets in science, politics,
sports, and music which helped Louis Vuitton expand its targeted market while retaining a sense
of prestige in the elite vector of each personified market.

Louis Vuitton has grown and stayed fresh by combating counterfeit, expanding its
partnerships and global market, and having relevant figures in diverse markets represent their
luxury brand.
2. Is the counterfeiting of Louis Vuitton always a negative? Are there any circumstances
where it can be seen as having some positive aspects?
“Counterfeit products” are fakes or unauthorized replicas of the real product. Counterfeit
products are often produced with the intent to take advantage of the superior value of the
imitated product.
The most counterfeited brands below, based on a number of cases compiled by the World
Customs Organization in 2016:
• Cartier
• Apple
• Michael Kors
• Louis Vuitton
• Chanel
• Adidas
• Walt Disney
• Gucci
No, counterfeiting is not always damaging to brands and can be leveraged to a brand’s
advantage.

MARKETING. MIDTERM 20
 Counterfeiting can give brands access to new markets and be a benchmark of a brand’s
health. It can increase a brand’s awareness such as when the economic climate of a country or an
individual improve, sales migrate from counterfeit to original. Also, it can also compel the
authentic brand owner to protect, innovate and expand its products, services, and markets to keep
ahead of its imitators and squeeze out the competition.

There are, of course, negatives to counterfeiting. However, if the fake is distinguishable

from the original, then the genuine brand owner is presented with significant opportunities such
as increased awareness, access to new markets, closing off the competition and an affirmation of
the brand’s values.
Lastly, if brand owners take hold of these opportunities and leverage counterfeiting to their
advantage, then they will be blushing not just from the imitation but also from the
congratulations of their achievements.

Louis Vuitton is one of the world’s leading international fashion houses; it sells its products
through standalone boutiques, lease departments in high-end department stores, and through the
e-commerce section of its website. For six consecutive years (2006-2012), Louis Vuitton has
been named the world’s most valuable luxury brand. In 2012 LV valuation was 25.9 USD, and in
2013 they were valued at 28.4 billion USD. With Louis Vuitton now it 50 countries with more
than 460 stores worldwide and still growing, I would have to say they are doing very well and
will continue to do so.

Samsung.
1. What are some of Samsung’s most significant competitive strengths?

A competitive strength grid organizes your research. It outlines the strengths, weaknesses,
and key points of differentiation for each of your competitors, and it guides your critical business
decisions.
Throughout Samsung’s existence, the brand evolved with the changing times resulting in
various competitive strengths. In the beginning, Samsung focused on volume and market
domination to help expose the Samsung brand as a real competitor against other powerhouse

MARKETING. MIDTERM 21
brands like Sony. Then, after the Asian financial crisis in the late 90s, Samsung switched
strategies, emphasizing product quality, and manufacturing flexibility.

Points-of-difference (PODs) are attributes or benefits that consumers strongly associate

with a brand, positively evaluate, and believe they could not find to the same extent with a
competitive brand. Associations that makeup points-of-difference may be based on virtually any
type of attribute or benefit.

PODs of Samsung:
• The highest resolution rates in the market as of now,
• Higher customizability for the tech-savvy,
• More sophisticated design.
Points-of-parity (POPs), on the other hand, are attribute or benefit associations that are not
necessarily unique to the brand but may in fact be shared with other brands.15 These types of
associations come in two necessary forms: category and competitive.

POPs of Samsung:
• Smartphones having basic features such as video and music players
• Smart TV
• Price range
Quality is associated with consistency. A customer who is happy with the first buying
experience needs and wants to be equally satisfied on each further occasion. Quality relates to
“appropriate use” — how well a product does what it is intended to do.
This newly found strength — Quality and manufacturing flexibility allowed Samsung to
maximize their product turnover ratio to less than six months. More recently, Samsung’s most
significant competitive advantage comes from a combination of research towards innovations
technology, critical partnerships with Sony and Microsoft, and their successful ad campaigns.
2. Samsung’s goal of $400 billion in sales by 2020 would bring it to the same level as
Walmart. Is this feasible? Why or why not?
I think is it feasible that Samsung would be able to reach its goal of $400 billion in sales by
2020. Currently, the company is the 9th largest global brand and #1 producer in smartphones,

MARKETING. MIDTERM 22
Smart TV, Semiconductors in the world. Their leadership position in these particular segments of
the market suggests the brand do extremely well going forward. The healthcare and home energy
markets are enormous — multi-billion dollar markets getting much attention in the global world.
I know Samsung had cut cost on R&D and saved potentially billion dollars that would’ve
hindered their overall growth of the business. During the economic downturn in 2008 and 2009,
it significantly affected the semiconductor industry, total consumer electronics sales, and
Samsung’s bottom line. To survive, Samsung slashed profit margins, decreased production, and
cut inventories. As a result, the company emerged at the end of 2009 with record-high quarterly
profits despite significantly smaller profit margins.
In closing, it is for the reason that I believe Samsung can get to $400 billion in 2020
because the company is prepared to change course quickly and reacts to the market place and the
demand of the consumers.

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