VICTORINOX CASE STUDY

1. WHAT IS THE PROBLEM?

Victorinox, a Swiss knife and watch manufacturer, is losing sales due to the increasing regulations that are
being implemented nowadays together with the new competitors the firm has to compete due to its new
expanded portfolio. Investments includes new tools to differentiate the company in all its product
categories.

WHAT IS THE FIRM´S SITUATION?

SWOT ANALYSIS
STRENGTHS:
Great brand recognition and awareness among current and new buyers.
Strong brand equity to keep attracting new clients and creating new customers relationships with current
and new buyers.

WEAKNESSES:
Despite this company has somewhat made some success in releasing new items, its reliance on star
products has not make them possible to focus on generating new products.

OPPORTUNITIES:
Develop a customer management technology for loyalty marketing

THREATS:
Competitors have in their typical market safe revenues and they can employ that income to enter in key
markets

2. WHAT ARE THE ALTERNATIVES THIS FIRM HAS?

1. DEFENSIVE: Because the disadvantage of Victorinox is that this company has to innovate in
differentiate themselves in all of its categories because of the possible new enter of competitors in key
markets, if we can potentiate that great brand recognition and awareness in all markets, Victorinox will
benefit from competitive advantage.

2. SURVIVAL/REORIENTATION: As competitors have income to enter in new markets with new

products and one of this business weakness is its reliance on star products, I propose to develop a
customer management technology for loyalty marketing and with that, Victorinox will have loyal
customers in these new markets and products.

3. WHAT ARE THE BEST CRITERIA FOR ALTERNATIVES ASSESMENT?

Victorinox has competitive advantage in its star products such as loyal current and new customers and
human resources. Thus, one of the most important parts of this firm is to maintain its star product in that
market. If this company continues to just focus on its “product” competitors are going to enter key markets
and differentiate by themselves and it will make it more difficult for Victorinox to increase sales.

4. WHAT IS THE EVALUATION FOR EACH ALTERNATIVE?

 CRITERIAS:
achieve short-term goal (10%), competitive advantage (30%), profit and sales (20%), low cost (15%),
brand recognition and awareness (10%), customer loyalty (5%) and reputation (10%)
- ALTERNATIVE 1: (9*0.1) + (10*0.3) + (9.5*0.2) + (7*0.15) + (9*0.1) + (10*0.05) + (8*0.1)
= 9.05
- ALTERNATIVE 2: (6*0.1) + (9*0.3) + (8*0.2) + (4*0.15) + (9*0.1) + (8*0.05) + (9*0.1)
= 7.7
ALTERNATIVE 1 is the highest so it will better to use.

5. WHAT IS THE BEST ALTERNATIVE SELECTION?

Through the decision stage, ALTERNATIVE 1 is the most suitable for Victorinox.
APPROPIATE: if the firm uses this strategy, they will reach the goal in a short time.
FEASIBLE: while potentiating this business recognition, the innovation in new products and markets will
have to be successful according to its competitive advantage in its star product. Thus, there is no need to
worry about costs.
ACCEPTABLE: the star product will not be affected by the entry of innovation in new products and neither
by the new marketing strategy.

6. WHICH IS THE ACTION PLAN?

The principal goal is to introduce Victorinox in new markets with innovative new products. For this, the
company will have to benefit more from competitive advantage by potentiating its awareness and
recognition. Having that, Victorinox will increase its sales because of its differentiation among competitors
and new expanded portfolio.

1. Which Criteria would you choose for the evaluation of the possible alternatives? Why?

7 criteria have been chosen for the alternative’s evaluation. Achieve short-term goal, create higher competitive
advantage, gain profit and sales, low cost, potentiate brand recognition and awareness, create higher customer
loyalty and reputation. Each one with its weight according to its importance and affectivity. The most important
being the competitive advantage and the least one being customer loyalty. Together with the competitive advantage,
but on the second hand, is also profit and sales. After that, low cost, brand recognition, awareness and reputation are
also key for deciding the alternatives.
All of them are determinants and key for the goal and will affect it if the company doesn’t take them into account.

2. What are you going to do next? Why?

Send a survey to the current loyal customers and check whether they will keep choosing Victorinox in their star
product although they are going to innovate in new products and that will need more focus. Then, results will be
quantified to be reviewed with the action plan in line the goal of the firm. When this is done, a new action plan
specifying the tasks each department will be in charge of. When the new marketing and innovative product has
arisen, make a 2-month trial and check if the company is benefitting more from competitive advantage and if
awareness have increased. Feedback will be needed so another survey has to be sent and decide whether to continue
with this strategy, change something or not follow it anymore. Feedback is key for something to go well so by
asking for it continuously this implementation should go well.

3. What results do you expect to obtain from the actions you propose to implement?
By implementing the new marketing strategy, keeping the star product as it has been working until now, focusing on
innovating in new products and marketing will lead Victorinox to differentiate among all of its competitors in its
products and markets with a very highly competitive advantage and number of sales.