This case highlights Whirlpool’s problems in China during the 1990s and contrasts competitive advantage between global firms and local competition in the appliance industry. The case briefly discusses what went wrong in China for Whirlpool like not managing distribution channels, bribery problems, wrong product decisions, not understanding local competition and so on.

Case Contents

1. Introduction – Whirlpool’s entry into China
2. What went wrong in China?
3. Working with local partners and system hassles
4. Bribery Scandal
5. Numerous small local firms that dominated the market
6. Competing with Chinese Appliance Makers
7. Underestimating Local Competition
8. Not managing the distribution channels efficiently
9. Wrong product decisions – Not keeping local needs in mind
10. Foreign Managers not understanding Chinese management culture
11. Market Saturation
12. Distribution System and labor hassles
13. Whirlpool in Asia
14. Whirlpool – Quick Facts
15. Bibliography
16. Exhibit 1 – Whirlpool’s joint ventures with local companies in China in 1995
17. Exhibit 2 – Whirlpool’s leadership position in various regions in 1999
18. Exhibit 3 – Whirlpool – Globalization – Entry into Foreign Markets
19. Exhibit 4- Competitive Advantages of Global firms in the appliance industry
20. Exhibit 5- Whirlpool and GE between 1995 and 1997

Sample Case Page

1. Introduction – Whirlpool’s entry into China

“We entered China pretty early compared to most companies. It was pretty much an unknown.”
- Michael Todman, president of Whirlpool International in 2007

Since 1988, Whirlpool has followed an aggressive globalization strategy under the leadership of former CEO, David Whitman. China had been one of its main entry targets and also fit into its global strategy of becoming the market leader in Asia. Whirlpool formed several joint ventures in China and India in the mid-1990s signaling a big push into the Asian market. However, in 1996, revenues from Asian operations were far from being profitable and accounted for only 6 percent of the total revenues of $8.5 billion. The company made losses to the tune of $70 million in Asia alone that year. Between 1994 and 1997, it invested over $300 million in four JVs in China. Two joint ventures in China were unsuccessful and loss-making. A year later, in 1997, with tough competition in China’s market and continued losses, Whirlpool decided to pull out of two joint ventures in China as part of a global restructuring exercise. (See Exhibit 5- Whirlpool and GE between 1995 and 1997 on page 8 ) Whirlpool’s efforts in the world’s most-populous country were not fruitful. Whirlpool’s then CEO David Whitman remarked, “We are taking steps to align the organization with the marketplace realities of our industry.”

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This case study/article, titled Whirlpool’s Problems in China, was originally published at Casestudyinc.com.

This case study analyzes the global mindset at Ford Motor Company, a leading multinational manufacturer of cars and trucks. The case also discusses a number of potential risks and challenges that Ford faces or may face in future and how it is responding to it. Ford’s global strategic management and strategies like ONE Ford, Aligned Business Framework (ABF), and matched-pairs are also briefly discussed.

Table of Contents

• Introduction – Ford’s Global Mindset
• Ford – Quick Facts
• Risk Factors in the Automobile Industry
• Financial Crisis and recession
• Oil Crisis, Changing consumer habits and Environment standards
• Investing in R&D and New Technology
• Assessing Risks in a global environment
• Early Years – From a market-seeking to a resource-seeking strategy
• Expanding capacity in markets where it is lagging behind
• Using new technology
• Local Sourcing
• Other Risk factors
• ONE Ford Strategy
• “Matched-pairs” system
• Aligned Business Framework
• Ford’s Global Manufacturing Strategy
• Standardization and Sharing Best Practices
• Ford’s Global product strategy
• Bibliography
• Exhibit 1 – Ford’s five key priorities in operating as a globally integrated team
• Exhibit 2 – Ford’s Facilities around the World
• Exhibit 3 – Ford’s Business Segments based upon its organizational structure
• Exhibit 4 – Industry sales volume – 2005 to 2009
• Exhibit 5 – Factors affecting Ford’s profitability
• Exhibit 6 – ONE Ford plan that Ford Motor Company is using to transform its business
• Exhibit 7 – Key elements of Ford’s Aligned Business Framework (ABF) agreements
• Exhibit 8- Main elements of Ford’s Flexible Manufacturing Strategy

This case study/article, titled Ford – Global Mindset and Risk Assessment, was originally published at Casestudyinc.com.

1. Introduction
2. Manufacturing – The first Dell ‘Made in India’ desktop
3. Dell’s Market Share in India
4. The Indian consumer and Local competition in India
5. DELL – Key Facts about the company
6. Dell – Company Overview
7. Dell – Business Segment Information
8. Dell Products and Services
9. Dell’s new retail strategy and Direct-only model
10. Dell’s New Marketing Strategy in India
11. Dell’s New Advertising Campaign for SMBs
12. Testimonial Advertising instead of Transactional
13. Dell’s CSR, Green Initiatives in India
14. Questions for discussion
15. Bibliography

Sample Page

“India is a great place to be in. It is growing faster than China for us.”
“We’re in 180 countries and I don’t track all of them because that can make you a bit dizzy. But I do follow our top 10 markets. India is in the top 10. In fact, it’s the fastest growing market of our top 10, ahead of everybody, including China. There are plenty of opportunities in India and we couldn’t be more excited.”
-Michael Dell in 2010

‘‘We’re very strong in the large enterprise segment, but over the next three years, we’ll also focus on consumers and small and medium (Indian PC market growing faster than China: Michael Dell news, 2010) businesses. That’s where we see a big part of the next billion dollars in India coming from.”
- Sameer Garde, India country manager in 2010

Introduction

Dell’s presence in India is no surprise. India is one of the most important emerging markets in the world. For years, selling PCs in Asia largely meant China . However, PC makers have recognized the importance of the giant Indian market , its booming economy and annual growth at more than 9%.

Dell started in India about seven or eight years back by opening a customer contact center at Bangalore in 2001. In 2003, the second contact center opened at Hyderabad. The company operates its services from four centers based at Bangalore, Hyderabad, Chandigarh and Gurgaon. Dell started in Bangalore providing customer support to English speaking countries and later also began providing technical support, procurement of financial back office and Knowledge process outsourcing. After the U.S., Dell India is the second biggest center with 23,000 employees. The strategic importance of India to Dell is evident from the fact that India was one among three locations (the other two being US and UK) where Dell’s Latitude E series and Precision notebooks were launched. In India, Dell already has a 23,000-strong workforce in about 10 years of operations and business from India is closing in on the $1 billion mark. Dell has nearly 13 per cent share of the Indian market.

Case Updates/Snippets

• Dell’s channel strategy is to make technology more available to small and medium businesses (SMBs). Dell’s channel partners contribute 22% to its total revenue globally. Out of 10 million SMB customers across the globe, Dell caters to 12,000 SMB customers in India. As per estimates, SMB market in India has over 7 to 13 million customers. Among the BRIC countries and U.S., India is ranked second for the number of SMBs.
• Stiff competion between Dell and HP in the Indian PC market: According to IDC, since 2005, HP has held the number one position in the Indian PC market every quarter (for the past six years). However, in the second quarter (April-June, 2010), Dell replaced HP for the first time with a 15.2 percent share. HP followed at 14.3 percent and Acer at 11.5 percent, though HP still led in the desktop segment. Dell was helped by strong marketing and its channel partners base while HP was disrupted by its move from a national distribution model to a network of regional distributors.
• PC Market in India:In 2009, 75 lakh PCs were sold. In 2010, the expected PC sales are 90 lakh. For the first six months ended June 2010, sales totaled about 45 lakh. [Note: 10 lakh=1 million, PCs include desktops and notebooks.]

This case study/article, titled Dell in India, was originally published at Casestudyinc.com.

1. Introduction – Restructuring at Lenovo
2. The Indian Challenge
3. Rationalizing Operations in India
4. About Lenovo – Background note, Business and Strategic Facts
5. Lenovo – Top Leadership Team, Key people
6. Lenovo: Quick Facts
7. Reorganization Strategy and the Boxer analogy
8. Lenovo’s Indian focus
9. Lenovo’s ‘half moon’ strategy for its emerging markets business
10. Lenovo’s three core competitive strengths
11. A unique dual business model
12. Lean cost structure
13. History of innovation
14. Marketing Strategy
15. Global Marketing Hub – India-based multicultural marketing communications team
16. Product positioning – Leveraging icons in the Indian Market
17. Five-Year Financial Summary
18. Bibliography
19. Figure 1 – Lenovo – Sales Analysis by Geography
20. Table 1 – India Client PC Market: Vendor Rankings and Market Shares
21. Table 2 – India Client PC Market – 4Q 2007, 4Q 2008
22. Exhibit 1 – Market share in the overall PC market
23. Exhibit 2 – Celebrity Endorsement by PC Brands in India
24. Exhibit 3 – Lenovo’s corporate values

Sample Page

“We have restructured our global business and have divided markets into the emerging and developed market categories. Our thrust remains on the emerging market because of the tremendous potential, and we will bring in the best practices from China to these markets. India remains on the top of the pack in our emerging markets business.”- Amar Babu, Lenovo India MD.

“It’s possible to double our share in Indian market in 3-4 years.” – Yang Yuanqing, CEO, Lenovo in July 2009.

“The company’s (Lenovo’s) market share has been on the decline in India for over a year. In the quarter ended Dec. 31, it ranked fifth behind Hewlett-Packard, Dell, Acer, and a local vendor HCL Infosystems.”- Diptarup Chakraborti, principal research analyst at Gartner.

1. Introduction – Restructuring at Lenovo

In January 2006, Lenovo the world’s fourth-largest PC maker restructured its global operations from four regions (Americas, Europe, Asia-Pacific and China) to five . India was a major part of Lenovo’s strategy and it was listed as a separate region to be managed. India had just 7.5 million PCs compared with China’s 40 million. This presented a huge opportunity for Lenovo and it wanted to double its market share in three to four years. The company was expected to find natural success in India as the Indian market was similar in nature to the Chinese market. In China, Lenovo had built a reputation as market leader. Lenovo’s market share in China was over 30% in the Chinese domestic market. According to data compiled by Bloomberg, China accounted for 48% of the company’s revenue for the first half of 2009. However in India, Lenovo was lagging behind competitors like Dell, HP (Hewlett-Packard) and local brands like HCL (Hindustan Computers Limited). Lenovo had a 7.3 per cent share in the Indian PC market.

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Case Updates/Snippets

Lenovo India – Retail expansion with LES Lite stores – lower cost stores in tier 3-5 cities

Lenovo India has customized LES Lite stores for the Indian market. These Lite stores are smaller versions of Lenovo’s exclusive stores and have lower costs and also lower break-even points as compared to bigger metro stores. The strategy with Lite stores is to expand into India’s key tier 3-5 cities/towns and are around 150-250 square feet in size. Lenovo launched its Lite stores in Bihar, India in October, 2010 and by April it had around 200 stores. In July 2011, Lenovo India inaugurated its 400th LES Lite store. The company has plans to open 1000 stores by March 2012.

Lenovo leads in India with single largest deal worldwide (Dec quarter 2011)

Lenovo will supply the Tamil Nadu (South Indian State) government with 3 lakh laptops. In all, Tamil Nadu state government plans to give away 68 lakh laptops to students in 5 years. Other competitors of Lenovo in India like Acer and HCL are also in line to supply the laptops.

This case study/article, titled Lenovo in India, was originally published at Casestudyinc.com.

Contents

1. Introduction – Wal-Mart’s first store in India
2. Joint venture with Bharti Enterprises
3. About Wal-Mart
4. Wal-Mart – Background Note
5. Wal-Mart – Timeline
6. Wal-Mart – Quick Facts
7. The world’s largest retailer isn’t new to India
8. India’s first special skills training centre
9. Exhibit – Wal-Mart’s business model in India
10. Mera Kirana programme
11. Exhibit – Foreign hypermarket chains in India
12. Wal-Mart Internationally
13. Exhibit – Wal-Mart and Expansion into International Markets
14. Wal-Mart’s imperfect success record in a foreign country
15. Cost-Leadership Strategy- Wal-Mart’s core philosophy – EDLP (every day low prices)
16. Will Wal-Mart succeed in expanding outside the U.S.?
17. Best Practices and lessons from the International Markets
18. Wal-Mart India – Plans and Challenges
19. Wal-Mart’s Strategy and Supply Chain tuning for India
20. Physical and Regulatory Challenges
21. The Indian Consumer
22. Bringing private label suppliers to India
23. Will the kirana store go out of business?
24. Advantages of a small Indian shopkeeper – The Kirana store
25. Exhibit: Wal-Mart – Store Formats
26. Exhibit: Wal-Mart – International operating formats
27. Questions for Discussion

Sample Page/Content

"India is a price sensitive market and therefore we will be devising our strategy for her very carefully…Retailing is like a game of three dimensional chess where we operate as a local, regional and global player, so depending on the needs of the market we shall change our format and adapt." – John B Menzer, President and CEO, Wal-Mart International.

"India is not a homogeneous market, so ours is not a cookie-cutter approach from the U.S. …Wal-Mart is in no hurry to unfurl the Wal-Mart flag nationally. The easiest thing is to roll out stores, but the most difficult is to sustain and feed them." -Raj Jain, President of Wal-Mart India in May 2009.

"Wal-Mart operates with multiple private brands around the world. In each market that we operate, we look to be local. We treat each market as unique and India, in this respect, is no different." -Arti Singh, vice-president of Corporate Affairs at Bharti Wal-Mart.

1. Introduction – Wal-Mart’s first store in India

In December 2006, Wal-Mart Inc. believed that by the year 2015, 35% of India’s retail sales could be from chain stores . This was a radical increase from the prevailing 2%. In May 2009, Wal-Mart was ready to open its first store in India. The reason for Wal-Mart’s entry in India was clear – The Indian middle class . The world’s biggest retailer had been silently working on its strategy for India for around two years. Mom-and-pop stores and traditional distribution networks dominated the $375 billion Indian retail market. Wal-Mart’s first outlet was set to launch in the city of Amritsar, Punjab in North India. The first store air-conditioned and built over 50,000 sq. ft. was on the outskirts of the city, Amritsar. The store employed 200 locals and was likely create 500 indirect jobs. In the first few weeks itself, the company had managed to sign on close to 35,000 members. However, the debut outlet was not to carry the familiar Wal-Mart brand. Did this mean Indian consumers could not benefit from Wal-Mart’s everyday low prices?

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Case Updates/Snippets

• 50:50 joint venture: In India, Wal-Mart has a 50:50 joint venture with Bharti Enterprises in the wholesale cash-and-carry segment.
• Direct Farm Program: Multinational retail giant, Wal-Mart’s Direct Farm Program in India is a partnership with 110 small and marginal farmers near Ludhiana in Punjab where it encourages cultivation of safe, high-quality, seasonal vegetables. Farmers are advised at every stage of cultivation by field agronomists. Farmers learn about nursery management, transplanting, nutrient management, as well as harvest and post-harvest practices.
• Wal-Mart India in 2010: In 2010, Bharti-Wal-Mart plans to launch seven Best Price Modern Wholesale Cash-And-Carry stores across India. These stores will be 100,000 sq ft in size and each store will involve an investment of $6-7 million.
• Sourcing from India: Wal-Mart has a large sourcing business in India. The retail major sources goods worth $125 million a year from Punjab. In 2010, Wal-Mart is planning to increase sourcing from India to strengthen its global business.
• Preference for Kirana/local retailers: According to a survey by ASSOCHAM in early 2010 in which it interviewed 5000 shoppers in various cities in India, kirana stores (mom and pop stores) and local retailers were the preferred destination for shoppers as compared to shopping malls. The survey found that goods were less expensive (as much as 25%) in local kirana stores as compared to big shopping malls. Smaller stores also offered more variety and affordable options with sustainable quality at a negotiable price (reduced margins).
• Training centers: Inheriting a model from its U.S. parent, Bharti-WalMart (Best Price Modern Wholesale) intends to set up its own training centers to train less-privileged youth to work in retail stores.
• FDI in retail in India: In India, the Government did not allow foreign investment in multi-brand retail. It allows 51% FDI in single-brand retail and 100% in wholesale venture. (Update: The Indian Govt. has changed its policy towards multi-brand retail in Nov 2011) In 2007, Walmart Stores and Bharti Enterprises entered into a joint venture and began cash & carry stores under the brand Best Price Modern Wholesale.
• Carrefour in India – Carrefour Wholesale Cash & Carry: In December 2010, Carrefour, the French international chain, launched its first cash & carry store in India (in the capital in New Delhi). The store with an area of 5200 square meters offers about 10,000 SKUs in food and non-food to local businesses, restaurants and local mom and pop stores.
• METRO Cash & Carry in India: In 2003, METRO Cash & Carry entered the Indian market in the self-service wholesale category. By early 2011, it had six wholesale distribution centers in four major cities (Bangalore, Hyderabad, Mumbai and Kolkata). The company caters to business customers (hotels, offices and small retailers) and sources a large part of its products locally from local suppliers, co-operatives and self-help groups.
• WalmartLabs in Bangalore : In addition to its R&D centre in the Silicon Valley, Wal-Mart plans to set up another facility in Bangalore, India (expected to be set up by Dec 2011) with about 100 developers to work on technologies and solutions for Wal-Mart’s global e-commerce business.

This case study/article, titled Wal-Mart in India, was originally published at Casestudyinc.com.

McDonald’s

In the UK, McDonald’s strategy is to listen more to local consumers and then act on it. The company strives to do this around the world. Some if its local favorites around the world include the McItaly burger in Italy, Maharaja Mac in India, the McLobster in Canada, the Ebi Filit-O in Japan.

McDonald’s has novelty items on its menu in Japan like the Teriyaki McBurger with Seaweed Shaker fries, Ebi Filet-O, Croquette Burger and Bacon Potato Pie. McDonald’s signed model Yuri Ebihara (known as Ebi-chan in Japan) to market Ebi Filet-O. Ebi means shrimp in Japanese.

Starbucks

Starbucks is trying out locally designed franchises in stores. The stores are non-Starbucks branded in order to recapture the feel of a local coffee shop, which would otherwise be threatened by the existence of Starbucks in its vicinity.

KFC

To increase visits from local residents, KFC has initiated a five-year plan to upgrade its UK restaurants with new contemporary designs. Designs will be based on ‘look and feel’ of the area and in collaboration with local property developers.

KFC has a vegetarian thali (a mixed meal with rice and cooked vegetables) and Chana Snacker (burger with chickpeas) to cater to vegetarians in India.

Tesco

When Tesco expanded globally in countries such as Thailand, Hungary and the Czech Republic it kept it’s usual name and branding. However, when it entered the United States, it named it’s stores "Fresh & Easy Neighborhood Market".

Nokia

Nokia responded to local customer needs with the introduction of dust-resistant keypad, antislip grip and an inbuilt flash light for Indian rural consumers (specifically targeting truck drivers).

Hindustan Lever Limited (HLL)

HLL identified the importance of rural customers and invented the shampoo sachets priced at almost a rupee which were an instant hit.

Ford

In 1904, Ford was one of the first automotive corporations to go International with the opening of Ford Motor Co. of Canada. Even Henry Ford II had opined that in order to further the growth of its worldwide operations, any purchasing activity should be done after considering the selection of sources of supply not only in its own company but also sources located in other countries. When Ford had set up its first plant outside U.S., in Canada, it gained considerably from the geographic and cultural proximity.

Viacom’s MTV localized strategy with localized programming

MTV has catered to local taste in East Asia in South Korea, China, India and Japan. E.g. MTV broadcasts on two channels with Chinese music in China and Hindi pop in India. Using joint ventures with local partners, channels are branded accordingly as MTV India, MTV Korea, MTV China and MTV Japan and use more local employees with use of local language.

Whirlpool Corporation

Whirlpool Example 1: Domestic appliance maker, Whirlpool incorporated specially designed agitators into its washing machines when it sold them in India. This helped Indian women wash saris without the five-foot long sari getting tangled. Whirlpool formed a joined venture with a local partner to produce the redesigned washing machine to suit local taste and culture. Whirlpool also makes its refrigerators in bright colors like red and blue as many Asian consumers placed their refrigerator in living rooms as a sign of status. Whirlpool believes in standardizing worldwide what it can and adapting what it cannot.

Whirlpool Example 2: As part of Whirlpool’s global strategy, the company wanted to develop products based on consumers tastes and needs. Whirlpool had done extensive research and found that European customers wanted a microwave oven that could brown and crisp food. Whirlpool then designed and introduced the VIP Crispwave which could fry crispy bacon and cook a pizza with a crisp crust. The product was successful in Europe and later launched in U.S. as well.

KFC – Yum! Restaurants

Global chain, KFC has introduced ‘Krushers’ in the cold beverages segment in India. The range of flavors of Krushers has been altered to suit the Indian taste buds.

Subway

The Subway chain does not have beef in its stores in India.

Taco Bell

The Taco Bell menu in India has crunchy potato tacos and extra-spicy burritos filled with paneer (cottage cheese). Taco Bell has hired employees who explain what burritos and quesadillas are to customers in India.

Coca Cola

In 1955, a Coca -Cola advertisement or documentary (almost 20 mins long) referred to as the “Pearl of the Orient” shows Coca-Cola’s popularity in Philippines and how Coke has merged itself into the Philippines economy and culture.

Heinz

In 2010, Heinz plans to launch packaged food products in India which will suit the Indian taste. Heinz, which entered India in 1994, plans to Indianise the flavors offering condiments, juices and snacks to the Indian consumers.

DisneyLand Glocalization in Hong Kong

In 2005, Disneyland was not that successful in Hong Kong with park attendance and growth revenues. Disneyland then made an effort to cater to the local Chinese taste by reducing prices, adapting to local Chinese customs and labor practices and also changed the decors and settings. Glocalization was successfully applied to the theme park in Hong Kong.

Dell’s Advertising in Japan and Asia Pacific regions

Dell did not use its American Steven Jackson (referred to as the Dell Dude) commercials in Japan and other East Asian countries after its Global Brand Management team used localized focus groups to gauge the TV character’s cultural acceptance. The attitude of the American character did not gel well with Japanese social etiquette e.g Know-all display and speaking to strangers without introduction.

Unilever – Marginal Local Adaptation instead of Total Local Adaptation

Unilever took glocalization (local adaptation) to a new level in the 1990s. Instead of adapting products unnecessarily, it adapted products to the local market marginally i.e. the basic product would be fine-tuned instead of expensive total adaptation. E.g. Unilever identified the need for a regional ice cream and was very successful with its Wall’s ice cream adapting it specifically to the Asian taste (different from the rest of the world). In 2000, it had a market share of 41% to Nestle’s 15%.

Another Unilever ice cream brand Asian Delight was very successful in Asia. Unilever’s Bangkok innovation center redesigned the product and adapted it to local taste (coconut ice cream mixed with fruits and vegetables used traditionally in sweets in the region) and packaging (Thai and English on packaging in Thailand).

Italian Luxury Fashion Retail Brands

Luxury retail brands like Bottega Veneta, a unit of PPR, and Canali, an Italian men’s fashion brand launched limited-edition of clutch (Knot India) and closed neck jacket (bandhgala worn by Indian men) specifically for the Indian market.

Nokia’s multi-SIM devices in the Indian market

Nokia launched multi-SIM devices (C1 & C2 series) in India, after it realized its potential. Nokia’s dual-sim phones were introduced late in the market after competitors LG and Samsung also introduced similar mobile phones. Nokia lost out on early market share (to competitors who introduced multi-sim devices early in the market) but planned to introduce it in other emerging markets as well.

Lenovo’s LES Lite stores in the Indian market

Lenovo India has customized LES Lite stores to expand into India’s key tier 3-5 cities/towns. These Lite stores are smaller versions (around 150-250 square feet in size) of Lenovo’s exclusive stores and with lower costs & break-even points.

This case study/article, titled Glocalization Examples – Think Globally and Act Locally, was originally published at Casestudyinc.com.

"If GE’s strategy of investment in China is wrong, it represents a loss of a billion dollars, perhaps a couple of billion dollars. If it is right, it is the future of this company for the next century." – Jack Welch

The significance of strategy in driving the success or failure of a business has gained increased recognition in recent years. Business and Strategy case studies provide an in-depth and clear insight to this important management subject, simplifying the business jargon and abstractions that often surround business education and strategy. Business Strategy cases generally include:

• Identification of strategic objectives
• Studying the business environment
• Identifying Strategic Opportunities
• Comparison of Strategic Alternatives
• Strategy Implementation

This case study/article, titled Business Strategy Case Studies, was originally published at Casestudyinc.com.

This case study highlights the merger between German sportswear-maker Adidas and Reebok to take on market leader Nike in 2005. Will Adidas’ $3.7 billion takeover of Reebok in 2005 be successful or is it hampering the German sportswear-maker’s performance?

Table of Contents

1. Introduction

Taking on Nike – market leader in the U.S.
Regulatory Issues – EU clears the Adidas-Reebok merger
Adidas plus Reebok is equal to better competition with giant Nike
Post-Merger and Integration Issues
Adidas-Salomon Group five-point strategy in 2005

2. Exhibit I: Adidas major locations in 2005



3. Adidas-Reebok combo synergy – Did the merger make sense?

Affordable shoes
Growing the Adidas brand
Cost Efficiencies
Cutting-edge technologies, innovative products and celebrity brand ambassadors
New business opportunities
A more geographically balanced sales mix


4. M&As in the sporting goods industry during the late 1990s and the early 2000s
5. Adidas Reebok Merger Fact sheet
6. Exhibit II: The Reebok acquisition according to Herbert Hainer, Chairman and CEO of adidas-Salomon AG
7. Industry Analysis – Athletic apparel and footwear industry, Sporting Goods in the U.S
8. Competitive Landscape in 2005/6 – Sporting Goods Industry
9. Is the merger successful?

Strong competition from Nike
Adidas – Fourth Quarter 2007 performance
Adidas vs. Reebok unit performance in 2007


10. Reebok History – Timeline
11. Adidas History – Timeline
12. Financial Analysis – Nike, Reebok, and Adidas in 2004
13. Exhibit III: Market Analysis – Nike, Reebok, and Adidas in 2004
14. Exhibit IV: Adidas-Salomon – Five year financial summary
15. Adidas-Salomon – Financial Data – 2004, 2005
16. Adidas Group – Financial Data – 2007, 2006
17. Reebok – Financial Data

Case Study Keywords: Adidas, Reebok, Nike, Mergers and Acquisitions, M&A, Sporting goods, Athletic Apparel, shoes, corporate takeover

Case Questions for Discussion

This case study/article, titled The adidas-Reebok Merger, was originally published at Casestudyinc.com.

The focus of this case study is the entry strategy of UK’s successful fast-fashion retailer Topshop in the U.S. This case briefly discusses Topshop’s business strategy, its early years and its success in UK fashion market. Can Topshop replicate its success in the U.S. market?

Table of Contents

1. Introduction – British retail chain Topshop’s U.S. debut
2. The Topshop Brand – a destination for pioneering British fashion
3. Background Note – Topshop in its early years
4. Topshop – History/Timeline/Important Events
5. Topshop’s entry and strategy in the US
6. Competition – Where will Topshop fit in the US retail scene?
7. Exhibit I: Typical Business Strategy of Fast-Fashion retailers
8. Topshop – Awards and Reputation
9. Exhibit II: Foreign Retailers in the United States
10. Exhibit III: Future expansion plans of foreign retailers in the U.S.
11. Exhibit IV: Services offered by Topshop
12. Exhibit V: Topshop Collections
13. Exhibit VI: Facts about the Arcadia Group
14. Exhibit VII: Fashion Brands under the Arcadia Group
15. Questions for discussion

Case Study Keywords: Fashion Retailing, Sir Philip Green, Topshop, Topman, Arcadia Group, Retailing in US, Fast-Fashion Market, entry strategy, international expansion

Case Questions for Discussion

1. Analyze Topshop’s entry strategy in the United States. Do you think it is the right move?
2. Compare and contrast your experience from your visit to a fast-fashion chain and other retail chains. What can Topshop do to add more value to its customers?

Case Snippets/Updates

• Topshop is present in around 30 countries. The Arcadia Group owned by billionaire Philip Green owns Topshop, Topman and Miss Selfridge brands. Arcadia also owns the Dorothy Perkins, Wallis, Evans, Outfit and Burton chains. By 2009, the Arcadia Group had 3,115 owned and franchised outlets in 34 countries.
• In 2006, Sir Philip Green, owner of Arcadia Group was knighted by Queen Elizabeth II. In 2002, he bought Arcadia for 850 million pounds. He and his family own about 90 percent of Arcadia. In 2001, he bought department store British Home Stores (BHS) and is known for successful turnarounds in the retail industry.
• In 2009 (12 months to August 29, 2009), Arcadia posted a 13% rise in pre-tax profits to £213.6 million. The growth marks a turnaround in performance after profits declined in the previous two years by 5% and 1.6% respectively.

This case study/article, titled Topshop in U.S. – Will London street style work in the U.S.?, was originally published at Casestudyinc.com.

This case study discusses how McDonald’s India managed to buck the trend in a struggling economy, its early years and business strategy to get more out of its stores in India. The case also briefly discusses how McDonald’s adapted to local culture in India, its localization and entry strategy, its strong supply chain and pricing strategy.

Table of Contents

1. Introduction
2. McDonald’s entry into India
3. Exhibit I: McDonald’s – Country – Entry Year
4. The Indian Market – Top 10 per cent of the busiest markets globally
5. Localization Strategy
6. McDonald’s JV in India
7. Initial Challenges – ‘Culturally Sensitive’ Food



8. Understanding Indian Customs and Culture
9. An Indianized Menu, Re-engineered operations and no beef burger
10. Competition – Major Competitors in India and Globally
11. McDonald’s – Quick Facts
12. Time line of McDonald’s in India
13. Pricing Strategy – The Rs-20 trap and ‘Purchasing Power Pricing’
14. Kiosks at store entrances for customers in a hurry
15. Home Delivery – McDonald’s Delivery Service or McDelivery



16. Out-of-home Breakfast – International McDonald’s format with local taste
17. McDonald’s Supply Chain Management (SCM)
18. Unique cold chain
19. Cutting costs
20. Exhibit II: McDonald’s Suppliers in India
21. Exhibit III: The Menu at McDonald’s India
22. Exhibit IV: McDonald’s – Early History and Growth
23. Exhibit V: Principles to McDonald’s business success
24. Questions for Discussion

Case Study Keywords: Fast-food Retailing, McDonald’s India, Joint venture, Amit Jatia, Vikram Bakshi, localization strategy, pricing strategy, McIndia, quick service restaurants, cultural adaptation, local culture, supply chain management, SCM, McDelivery, unique cold chain

Case Questions for Discussion

1. McDonalds has become the poster brand for recession-resilient business. What is McDonald’s doing right in India? What elements of its business strategy are working for it and how does it manage to get more out of its stores?
2. Does local adaptation contribute to business growth in a country? Explain McDonald’s efforts to adapt to the local culture in India. What challenges did McDonald’s face in India?
3. Have you ever visited a McDonald’s store? Compare and contrast your experience with another quick-service restaurant or fast-food joint you visited earlier. How can McDonald’s improve? Should it alter its strategy?

Case Updates/Snippets

• World’s leading food service retailer – McDonald’s has more than 32,000 restaurants serving over 50 million customers each day in more than 119 countries.
• McDonald’s competitors in India – McDonald’s competes with fast food chains like Pizza Hut, Domino’s Pizza, Papa John’s, Nirula’s and KFC in India.
• McDonald’s Supply Chain – McDonald’s has a dedicated supply chain in India and sources 99% of its products from within the country. The company has strong backward integration right up to the farm level.
• Quick service restaurants in India – By October 2009, McDonald’s India had more than 170 quick service restaurants in India. Domino’s Pizza, which began operations in India in January 1996, has over 275 stores across 55 cities in the country. KFC has 46 restaurants across 11 cities in India. (KFC is one of the 5 brands owned by Yum!. KFC is a $12 billion global brand and a leading quick-service restaurant (QSR) in many countries.) Nirula’s, one of India’s oldest food chains (completed 75 years in service in March 2009), has a network of around 62 outlets in five states across Northern India. Nirula’s, established in 1934 has interests in hotels, restaurants, ice cream parlours, pastry shops and food processing plants. Nirula’s was the first to introduce burgers in India.
• Food Industry in India – In India, food industry and particularly informal eating out market is very small. In India, over quarter of a million customers visit McDonald’s family restaurants every day. The Indian fast food market is valued at $1-billion (Rs 4,547 crore) aprrox.
• MFY (Made for You) food preparation platform – MFY is a unique concept (cooking method) where the food is prepared as the customer places its order. All new upcoming McDonald’s restaurants are based on MFY. This cooking method has helped McDonald’s further strengthen its food safety, hygiene and quality standards. McDonald’s has around 10 MFY restaurants in its portfolio.
• How McDonald’s manages to keep its prices down? – Fast-food chains face a tough time balancing between margin pressures and hiking prices which can hurt volumes. Consequently, the chains have to increase rates or rework their strategies. Affordability has been the cornerstone of McDonald’s global strategy. Some of its measures to achieve this include – Bulk buying, long-term vendor contracts, and manufacturing efficiencies.
• McDelivery Online – In India, McDonald’s first launched home delivery of meals in Mumbai in 2004. McDonald’s now has plans to launch web-based delivery service in India (across 75 McDelivery cities) in 2010, a pilot for which has already been tested by it in Hyderabad. The company hopes to add 5 per cent to sales via Web delivery. McDonald’s web-based delivery model will be based on serving the customer quickly wherein the drive time does not exceed seven minutes because its food has to be eaten within ten minutes of preparation. The footfalls in India are amongst the highest in the world, but the average bill is amongst the lowest. At present (March 2010), Domino’s Pizza (operated by Bhartia Group-promoted Jubilant Foodworks under a master franchise agreement) has a 65% market share in the home delivery segment.
• Most Preferred Multi Brand Fast Food outlets: In 2009, McDonald’s India won the CNBC Awaaz Consumer Awards for the third time in the category of the Most Preferred Multi Brand Fast Food outlets.
• McDonald’s India in 2010 – In 2010, McDonald’s India plans to open 40 more outlets. The company has also earmarked a budget of Rs 50-60 crore to market its new products and initiatives for consumers. Its new marketing campaign is titled – ‘Har Chotti Khushi Ka Celebration’ – in other words ‘celebrate little joys of life’ where it positions McDonald’s as a venue for enriching life of consumers. In South India, McDonald’s has 29 outlets and plans to add 10 more by end of 2010.
• Taco Bell in India – In March 2010, Taco Bell, the Mexican specialty chain owned by US-based fast food brands operator Yum! Restaurants launched its first outlet in Bangalore, India. The company which also operates brands like Pizza Hut and KFC plans for contract farming to open up to 100 outlets by 2015 and also expand into Tier-II and -III Indian cities eventually.
• Local Vegetarian Menu: In India, McDonald’s does not offer pork or beef-based products. It’s menu is more than 50 per cent vegetarian. The fast food retail chain has separate production lines and processes for its vegetarian and non-vegetarian offerings.
• High Real-Estate costs in India: In many countries, in a Quick Service Restaurant (QSR) a customer comes in, buys and then leaves. This is known as a revolving door concept. But an Indian customer believes in a dine-in culture. This adds to the real estate costs which goes as high as 20-25 per cent as compared to 10-15 per cent globally.
• The most important meal for QSRs- Morning Meals (Breakfast):According to market research company, the NPD Group, breakfast accounted for nearly 60 per cent of the restaurant industry’s traffic growth over the past five years in the U.S. Quick service restaurants sold 80 per cent of the over 12 billion morning meals served at US restaurants for the year ending in March 2010.
• OOH Branding: According to Rameet Arora, senior director – marketing, McDonald’s India (West and South), McDonald’s India may be the largest out-of-home branding (OOH) in the country. McDonald’s India has restarted OOH (out-of-home branding) after a 7 to 8 year break to reach to their target group.
• Employees and Customers: In India, McDonald’s employs 5,000 people and serves half a million customers a day via its 169 family restaurants. McDonald’s has 85,000 employees and serves 2.5 million customers a day in the UK.
• KFC – New Menu “Streetwise” – In February 2011, KFC, the fast food retail chain announced a new menu called “Streetwise” to offer products at more affordable prices to attract the college crowd. KFC has around 108 stores in India and Streetwise would help it compete better against McDonald’s youth brand offering in India (products priced at Rupees 20). KFC’s products were typically priced between Rs 65 and Rs 500 but with the new menu – between Rs 25 and Rs 100.
• New Business Channels – To boost sales, McDonald’s is looking at new business channels instead of rapid expansion. New business channels include home delivery, kiosks, breakfast, extended hours and drive-throughs. As per estimates, home delivery can increase store sales about 15% and drive throughs by 50%.

This case study/article, titled McDonald’s – Business Strategy in India, was originally published at Casestudyinc.com.

The focus of this case study are the innovative strategies adopted by leading Indian organized book retailing chain – Crossword Bookstores Limited. This case discusses the constant innovations brought about by the bookstore and how it has brought international standards of book retailing to Indian customers.

Table of Contents

1. Introduction
2. About the Company
3. Background Note – A dream of an India-based world-class bookstore
4. Exhibit I – Most Frequently Visited Book and Music Stores in India
5. Exhibit II: Achievements and recognitions for Crossword
6. Crossword – Quick Facts
7. Crossword – Market Positioning



8. Exhibit IV – SWOT Analysis of the Indian Book Market
9. Exhibit V – Book retailing scenario in India
10. The ‘print then distribute’ model
11. Driving factors for Market growth in India
12. Typical Characteristics of the Indian book market in the 80s
13. Exhibit VI: Journey of Organized Retail in India
14. Exhibit VII: Population Growth rate and ROI on Retail real estate in India
15. Exhibit VIII: Typical Bookstore classification in India
16. Innovations at Crossword
17. What has shifted shoppers’ loyalties to the up market bookstore?
18. Crossword – Breaking the rules – Much more than a bookstore
19. The inaccessible ‘U’ shaped first store
20. Exhibit IX: Simple innovations at Crossword Stores
21. Keeping the customers in mind – Understanding buying readers’ psyche
22. Improving window displays
23. A welcoming café
24. Reading tables and chairs
25. Helping booklovers – ‘Books once sold WILL be taken back’
26. Crossword Children’s Hour – Book Reading and story-telling sessions
27. Unique Product Mix
28. Increasing margins with non-book business category and own private label business
29. Innovative marketing strategies for book retailing in India
30. The Crossword Book Award
31. Exhibit X- Crossword Book Award winners
32. Shop-in-shop model
33. Investment in an ERP
34. Design Innovation – High-and low-impulse sections, Adjacencies
35. Crossword – Store Formats
36. Competitor Oxford’s – Store Formats
37. Exhibit XI: Retailing formats available in India
38. Summary of Financial Performance of Crossword Bookstores (2007-08)
39. Competitor Analysis – – Crossword vs. Oxford Bookstore
40. Crossword – Store Locations in India
41. List of major book retailing chains in India
42. Exhibit XII: Book Exports to India from the UK and the USA, 2000–2006
43. Exhibit XIII: India – Lifestyle, Demographic and economic indicators
44. Exhibit XIV: India’s income classes (1994-2006)
45. Exhibit XV: Organized Retail Penetration in India across categories
46. Popular Book and Author choices in India
47. Crossword – Best of 2008 list
48. Overview of the U.S. Bookstore industry
49. Questions for Discussion

Case Study Keywords: Organized Book Retailing, Crossword, Shopper’s Stop, Landmark, Oxford bookstores, book retailing in India, leading bookstore, retail formats, R Sriram

Case Questions for Discussion

1. “You can’t take books as any other commodity. If every store has the same kind of books, what’s the fun? In this business you have to know how to select books and build customer relationship.” – How did Crossword change the book retailing scene in India? Analyze the growth of Crossword as a world-class book retailer.
2. Compare and contrast your experience from your visit to a local bookstore to the innovative services being offered by Crossword at its stores. What can Crossword do different to add more value to its customers?

Case Snippets/Updates:

• Crossword Bookstores Ltd. is a wholly owned subsidiary Company of Shopper’s Stop Ltd – India’s leading department store chain. Crossword has 55 stores across 11 cities in India.
• In 2006, Businessworld rated Crossword as the 6th Most Respected Retailer in the country
• In Dec 2009, Crossword launched its 55^th store in India. The store, launched in Hyderabad was the 5^th one in the city by the leading lifestyle bookstore chain.
• According to Assocham, an industry chamber, organized retail in India accounts for $9.23 billion (around Rs 42,000 crore). This is around 5% of the overall retail market. This figure will reach $13 billion (approx. Rs 60,375 crore) by 2010.
• Organized book retail in India: Organized retail has only a 7% share in the approximately Rs 3,000 crore Indian book retail industry. According to Technopak, the contribution of book retail is only about 1% to the overall retail industry and is expected to grow by approximately 15% yearly.

This case study/article, titled The Crossword Story – Innovative Strategies in Book Retailing, was originally published at Casestudyinc.com.

1. Introduction
2. Background Note
3. Exhibit I: H&M’s Growth (1974 – 2007)
4. Exhibit II: H&M’s International Expansion
5. H&M’s Supply Chain
6. Exhibit III: H&M’s Best Price Strategy
7. H&M’s Financial Performance Summary (Revenue and Net Income)
8. Exhibit IV: H&M’s Three Sales Channels – Stores, Internet and Catalogues
9. Exhibit V: Table showing some major retailers with # of stores in Japan
10. Exhibit VI: Comparison with major global specialty clothing retailers
11. H&M Quick Facts – Brief Company profile – Revenues, Industry, Employees, Operations, Total Stores, Sales Channels, Major Competitors, Major Brands/Labels, Business/Growth Strategy, Key Executives
12. H&M’s Entry Strategy into Japan
13. Hurdles when entering the Japanese market
14. Channel Issues – Will H&M’s strategy to go alone work in Japan?
15. Product Quality Issues — Will H&M’s fast fashion work in Japan?
16. Design Collaboration, Designer Brands
17. Understanding the Japanese consumer – group oriented culture, the price factor and the Japanese H&M fan club
18. In conclusion
19. Additional Reading and References

1. Introduction

"It has been H&M’s dream to open in Japan. I am very proud to say that we now have our very first store in Tokyo. Japan is a very strategic and exciting market with great fashion awareness. We hope that we can offer our Tokyo customers added value through fashion and quality at the best price. We’re not in a hurry in Japan but we see huge potential if we succeed. We’ll go step by step."
-Rolf Eriksen, CEO of Hennes and Mauritz at the ceremony to open the Japan flagship store.

"Our business concept is really what attracts the H&M customer: Fashion and quality at the best price. Because we do carry all these different lines in our stores, we allow our customer to address [his or her] personality, and that’s really important."
- Karen Belva, public relations manager and spokesperson of H&M in 2002.

"With H&M’s opening, everybody – the Gap and Zara – will have come to Japan"-
Tadashi Yanai, Chief Executive, Fast Retailing, referring to Inditex’s Zara apparel chain.

In April 2007, Stockholm-based Swedish fashion giant Hennes & Mauritz (H&M) opened its first flagship store in China. About a year later (in September 2008), this strategic move was followed by another first H&M outlet in Tokyo, Japan, the world’s second-largest economy. The H&M store – a four-storey shop was strategically located just a few buildings down from competitors Zara and Gap Inc stores. The new store with a floor space of more than 1,000 square meters was first in a series of stores that H&M planned to open in Japan. The world’s No. 3 clothing retailer had aggressive plans to open stores in Japan, as well as sites in regional shopping centers.

With the European markets saturating, H&M was pursuing a rapid international expansion strategy. But the timing of H&M’s entry strategy into Japan, especially when the economy was struggling with recession and customers were tightening their purse strings was open to discussion. Besides, Japan was regarded as one of the world’s most competitive fashion markets. Market reports also suggested a declining market for clothing and footwear. Some observers called it the toughest trading conditions in decades. However, H&M was confident of differentiating itself and competing with expensive brands like Christian Dior, Giorgio Armani and Chanel, as well as the more reasonably priced Gap and Japan’s hugely popular Uniqlo chain.

Background Note

H&M was founded in 1947 by Erling Persson, a salesman from Västerås – a small town in Sweden. He began his career working for his father delivering cheese to restaurants in Stockholm on a bicycle. He was attracted by the concept of clothes stores selling stylish garments at low prices when he once visited the U.S. He was amazed at the success of retailers like Macy’s in New York. He opened a similar store in Västerås selling clothes for women. He named the store ‘Hennes’ which stood for ‘hers’ in Swedish…

…Today, H&M is the world’s third-largest retailer by sales with around 1,600 stores in 32 countries with 68,000 employees. In the past two decades, H&M grew at an average rate of 20% annually. It managed to grow quickly into the world’s third largest clothing retailer by offering clothing that is seen as both fashionable and reasonably priced. It made its mark on the apparel industry, mixing the latest trends with fashion classics. H&M is popularly known as the king of “fast fashion” and the purveyor of quick-to-market trendy clothing. H&M’s business model is based on "Fashion and quality at the best price."

Will H&M be successful in Japan?

"I believe that the interest in a new change would be big in Japan. It’s one of the biggest countries we have entered. If we succeeded as we have done in all the other countries,[Japan] could be a huge market for H&M."- CEO, H&M

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Related Case Studies

• H&M’s Low-cost, High-fashion Supply Chain

Case Keywords: Hennes & Mauritz, H&M, Entry Strategy, Japan, Expansion into global markets, International Business, Competitive Strategies, local culture, Japanese apparel market, Fast Fashion, Best Price Strategy, H&M’s Three Sales Channels, Channel Issues, Product Quality Issues, Design Collaboration, Designer Brands, Japanese H&M fan club, Erling Persson, Zara, Uniqlo, Fast Retailing, Supply Chain

Case Updates/Snippets

• H&M in Asia- H&M has over 1,800 shops in more than 30 countries. H&M’s principal markets are in Germany, the United Kingdom and Sweden. In Asia (2009 figures), H&M has four stores in Japan, 15 stores in China and 6 stores in Hong Kong. It plans to set up its first store in Korea, sees potential in Taiwan and wants to up its store count in China by 30% in 2009. H&M’s top management considers Asia to be the newest and biggest market for H&M in future.
• H&M’s business model and focus on low-cost, fast-moving fashions, and geographic spread helped it to weather the economic downturn better than its competitors. During 2009, the Swedish fashion retailer H&M was the top-ranked global fashion retailer.
• In fiscal year 2009, H&M added a total of 250 new stores, 25 more than originally planned.
• H&M in China: In 2007, H&M entered China. By 2011 it had 64 stores in China out of a total of 2,410 world-wide. China has been more profitable to H&M than any other market and it expects to treble its store count by opening stores in smaller cities of China.

This case study/article, titled Hennes & Mauritz (H&M) in Japan – Hit or Mistake?, was originally published at Casestudyinc.com.

1. Introduction
2. eBay – Company Background
3. Pierre Omidyar – The founder of eBay
4. Early Days – From AuctionWeb to eBay
5. Meg Whitman and the growth of eBay
6. eBay – Quick Facts
7. eBay’s International Expansion
8. Exhibit I – eBay’s Net Revenue by Territory
9. eBay and its entry in Japan
10. Exhibit II – Yahoo Japan and eBay comparative data (in 2001)
11. Why eBay failed in Japan?
12. Stiff competition from Yahoo Japan
13. Not adapting to local culture and practices
14. No first-mover advantage
15. Low-key Marketing and Advertising
16. The return of eBay to Japan
17. Questions for Discussion
18. Exhibit III: Selected Financial Data for five years
19. Exhibit IV: eBay stock performance graph

Case Abstract

Issues/Information Covered

• eBay’s entry strategy in Japan
• eBay company background
• Why eBay failed in Japan?

Introduction

“We were late to the market and entered when Yahoo!/Softbank had gained a lot of momentum through its Internet portal. eBay is committed to the Asian market and may return to the Japanese market when economic conditions are better and when they have a strategy that addresses the issues they currently face in Japan.”
– an eBay spokesperson in 2002.

Ever since its entry in Japan in 2000, eBay, the US online auctioneer was struggling. By the end of 2001, many analysts felt that eBay Japan should admit defeat and sell a majority stake in the venture to a bigger local player. But even then, eBay would face an uphill struggle. In February 2002, eBay, announced its decision to exit from the Japanese market after it failed to gain a foothold in Japan lagging behind market leader, Yahoo Japan. The company also announced that its Japanese language site would be closed and 17 jobs would be cut. All its Japanese customers would be directed to its US based auction operations/site. At the time, eBay was the number one auction site in all of the other 18 countries in which it operated and one of the few successful internet companies, having seen its profits soar even amid the dot-com implosion. eBay’s strategy in Japan had failed. Japan was a rare failure for the company.

Japan was critical to eBay’s success because it was the world’s second-largest Internet market. The gap had to be closed soon otherwise Yahoo Inc. could easily beat it in the rest of Asia. Yahoo Japan was the No. 1 or No. 2 portal everywhere except China. In December 2007, Yahoo Japan and eBay made a deal to link their auction sites and make it easier for their respective users to bid on and buy goods available on each other’s sites. A new website by name “Sekaimon” (‘gateway to the world’ or ‘global shopping’ in Japanese) – www.sekaimon.com – was launched in December. The site allowed Yahoo Japan users to bid on items listed on eBay’s US site using their Yahoo Japan ID. The deal made cross-border bidding easier and gave eBay another chance to woo Japanese consumers…

Keywords: eBay, Japan, International Expansion Strategy, Entry Strategy, local culture and practices, Yahoo Japan, Pierre Omidyar, Meg Whitman, first-mover advantage, AuctionWeb, Sekaimon, Internet Auction, Online selling and bidding, Online Marketplaces, PayPal, Skype, Half.com, Rent.com, Shopping.com, StubHub, Alando AG, iBazar S.A., NeoCom Technology Co Ltd., EBay’s international operations, online shopping business, Sanook, TOM Online

This case study/article, titled eBay in Japan, was originally published at Casestudyinc.com.

1. Introduction to Unilever's Restructuring Initiatives
2. History of Unilever
3. The 1880s – Lever & Co and Sunlight Soap – A revolutionary product
4. Lever Brothers – Growth with acquisitions and new product introductions
5. 1930 – Unilever is born
6. Unilever – Rapid Growth with diversification
7. Unilever N.V. and Unilever PLC
8. Unilever's Path to Growth Strategy
9. Key focus areas of the Path to Growth Strategy
10. Organizational Restructuring
11. Foods and Home and Personal Care as two separate Global Units
12. Unilever's Brand Restructuring
13. Brand focus strategy ‘nourishing the core’
14. Major components of Brand Strategy under PGS
15. Brand Acquisitions and Consolidation Strategy
16. Brand Disposal Strategy at Unilever
17. Marketing and Distribution
18. Advertising
19. Simplifying Business Processes
20. Supply Chain Restructuring
21. Questions For Discussion
22. Exhibit 1: Unilever – Turnover and profit for the last 12 years
23. Exhibit 2: Sales Growth of Unilever
24. Exhibit 3: Comparative Data on Unilever’s close competitors
25. Exhibit 4: List of Unilever’s Major Brands

Case Study Abstract

The case study highlights Unilever’s business strategy focusing mainly on its restructuring initiatives. The case analyzes in detail the key elements of Unilever’s restructuring plan ‘Path to Growth Strategy’ initiated in early 2000.

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Case Study Keywords: Unilever, organizational restructuring, FMCG, fast moving consumer goods, Path to Growth Strategy, organizational structure, branding strategies, supply chain management, corporate restructuring, brand portfolio management, Lever Brothers, Foods and Home and Personal Care categories, Patrick Cescau, Anglo-Dutch consumer product company, Dove soap, Lipton tea and Ben & Jerry’s ice cream, William Hesketh Lever, Sunlight soap, Margarine Unie, P&G, Tide, Brooke Bond and Faberge/Elizabeth Arden, Simplifying business processes, Keki Dadiseth, Snuggle, Vaseline, Close-up, Ponds, Dove, Persil, Bird’s Eye, Knorr, Sunsilk, Calvin Klein, Lipton, Magnum and Omo, Brand focus strategy nourishing the core, • Expanding brands into new markets, Brand Acquisitions and Consolidation Strategy, Slim-Fast Foods Co, Bestfoods acquisition, Brand Disposal Strategy, Supply Chain Restructuring, Management Case Study

Get more information on Unilever’s strategies, decision-making, marketing, brand management, innovation, acquisition strategies, corporate culture and human resource management in this book: Renewing Unilever: Transformation and Tradition

This case study/article, titled Restructuring at Unilever – Path to Growth Strategy, was originally published at Casestudyinc.com.

Ryanair was the first budget airline in Europe, modelled after the successful U.S. low cost carrier, Southwest Airlines. Ryanair is one of the oldest and most successful low-cost airlines of Europe. This case study on Ryanair highlights its low fares business model, its business strategies and operations. The case further incorporates the history and business description of Ryanair, its’ operations and challenges as a budget airline. Features and benefits of the low cost business model are also discussed.

Table of Contents

Introduction

• RyanAir: The ‘Southwest’ of European Airlines in 2007
• A year earlier…Ryanair, hedged fuel and a performance to envy
• Exhibit 1: Summary Table of Results and Key Statistics
• Exhibit 2: Ryanair Passenger Growth in Millions


History of Ryanair


• Ryanair’s initial efforts as a low-cost carrier
• 1990 – Restructuring at Ryanair
• The growth of Ryanair


Analyzing the Low-cost Business Model


• Ryanair Low Fares Strategy and Standardized Operational Model
• Advantages of using secondary or airports located outside city
• Lower Wage bills
• Ryanair.com and Online booking of tickets
• Paid-for extras – Sources of additional revenue
• The easyJet challenge
• Ryanair – Failed merger bid and other Controversies
• Ryanair / Aer Lingus merger failure
• Ryanair and EU
• Some low-fare carriers around the World
• Exhibit 3: List of Approved and prohibited mergers by the EU in the airline industry
• Exhibit 4: Features and Benefits of the Low Fares business model
• Exhibit 5: Comparative performance data of some major European LFA
• Exhibit 6: Oil Prices Comparison, 1994 – 2007
• Exhibit 7: Map of the European Union




• Questions for discussion

Introduction – RyanAir: The ‘Southwest’ of European Airlines in 2007

Ryanair, Europe’s biggest low-fares airline (LFA ) reported its third quarter results for 2007 with net profits dropping 27 percent compared to a net profit of 48 million a year earlier. Ryanair cited poor market conditions, fuel costs (oil prices at $90 a barrel) and concerns on recession in the UK and many other European economies for its current performance and not so strong future profit expectations. With average winter fares dropping almost 5 percent its’ underlying net profit in the three months to end December fell to 35 million euros ($52 million). Other factors that contributed included doubling of airport charges combined with reduction of winter capacity at Stansted , significant cost increases at Dublin Airport combined with longer sector lengths and staff costs which increased by 18 pct to 67 million euros. Ryanair’s net profit figure excluded a one-off gain of 12.1 million euros ($17.99 million) arising from the disposal of 5 Boeing 737-800 aircraft…

History of Ryanair

Ryanair was set up in 1985 and is one of the oldest and most successful low-cost airlines of Europe. In fact, Ryanair was one of the first independent airlines in Ireland. In 2001, many believed that Ryanair was like the Wal-Mart and Southwest Airlines of Europe. Ryanair transformed the Irish air services market where other airlines like Avair failed to compete with the more powerful national carrier Aer Lingus.

Ryanair’s initial efforts as a low-cost carrier

Ryanair began by offering low-cost no-frills services between Ireland and London. Ryan brothers – Catlan, Declan and Shane Ryan were the founding shareholders of Ryanair. Ryanair was set up with a share capital of just £1, and a staff of 25. Tony Ryan, their father and the chairman of Guinness Peat Aviation (GPA), an aircraft leasing company lent Ryanair its first airplane, a fifteen-seater turbo prop commuter plane. Ryanair’s first cabin crew recruits had to be less than 5ft. 2ins. tall so as to be able to operate in the tiny cabin of the aircraft. …Download full-text of this case study to read more.

Case Updates/Snippets

• Ryanair operates on more than 1,000 routes across Europe. Ryanair was founded in 1985 offering small flights from Ireland to England.
• Low-cost model in US – Ryanair’s entry in the US market – In 2008, Ryanair announced plans to operate in the United States. The plan includes forming a sister company that would begin servicing within three years. However, the start date has been delayed. Low-cost airline model attempts in the U.S. include Skybus in 2007 (which shut down within 10 months of operation) and Spirit Airlines (which shifted to the low-cost model in 2007).
• In recent years, fares have declined in the U.S. with budget carriers like Southwest Airlines and JetBlue Airways operating. However, the US airline industry has been struggling to match Europe where the cost of flying is very less.
• In 2011, Ryanair’s total passenger traffic included Spain market traffic (32.2 million passengers) at about 20 per cent followed by Italy and the UK. Last year, Ryanair became the biggest passenger carrier in Spain.

This case study/article, titled Case Study on Ryanair, the biggest low-cost European Airline, was originally published at Casestudyinc.com.

The focus of this case study is the business strategy adopted by Nokia in the Indian Mobile devices market. This case study summarizes Nokia’s business strategies in India. Nokia has proven itself as one of the most recognized brands
in India in the past decade or so. This case also discusses in brief some of the marketing strategies of Nokia in India and examines how the Nokia brand has emerged.

Pic: A Nokia Dealer Store in India

This case study covers the following issues:

• Assess Nokia’s globalization strategies
• Examine and analyze the entry and expansion strategies of Nokia in India
• Analyze Nokia’s efforts to localize its practices in India market.

Nokia – Company Overview

Nokia Corporation (Nokia) is a global manufacturer of mobile devices headquartered in Espoo, Finland. Nokia operates through four business groups: Mobile Phones, Multimedia, Enterprise Solutions and Networks. In Q3 2007, Nokia sold over 111.7 million units worldwide, marking a 26 per cent, year-on-year growth. Nokia India had revenues of more than $3.5 billion in 2006…

Case Study Contents

1. Nokia – Company Overview
2. Company History
3. Nokia Timeline
4. Nokia in India
5. Locations and Subsidiaries
6. Mobile Devices Industry in India – Business Description
7. Restructuring
8. Distribution challenges – Getting to the Rural Market
9. Understanding the versatile Indian market
10. Nokia – Branding Strategy
11. SRK in Nokia ad campaign
12. Nokia India Recognitions and Awards
13. Related Reading
14. View sample pages of this case study

Case Study Keywords: Nokia in India, Mobile devices industry, Handsets, Cellular phones, Expansion and Entry Strategy, Business Strategy Case Study.

Additional Reading: Articles on Nokia

• Nokia to exit expensive Germany, move production to low cost countries
• Nokia’s Acquisition Strategy and Restructuring
• Nokia and its Growth Strategy in China
• Sony Ericsson Mobile Music Strategy not working
• Nokia India – Tapping the Rural Market
• Nokia’s Strategy in the Emerging Markets
• Nokia – A struggling market leader

Case Snippets/Updates:

Essence of Nokia India’s business strategy according to Nokia India’s Managing Director, Mr D Shivakumar (As quoted in “Nokia’s biz strategy to increase India market share” in 2009)

1. Do not underestimate competition
2. Do not rest on laurels
3. Be modest, flexible and open to change

Nokia and the Indian Market

• Nokia’s Entry in India: Nokia entered India in 1995.
• Third Largest Telecommunication Market: India ranks third globally after China and U.S. in terms of the largest telecommunication market.
• 500 million mobile subscribers in India: The Indian market is adding about 10 million users a month. Nokia sees the Indian market as a growth opportunity particularly in the country’s rural areas. Rural penetration in India is still very low at 13%. By 2010, Nokia estimates that there will be around 500 million mobile phone users in India as compared to 427 million. According to Standard Chartered Bank’s annual forecast, India will have signed up its 500 millionth mobile subscriber sometime in December 2009 or January 2010. So, it took India 12 years (from 1997 when the mobile revolution began) to grow from zero to 500 million subscribers. However, analysts estimate it will take only five years to add the next 500 million.
• Nokia’s market share in India: Nokia has more than half the share of India’s mobile handset market. In 2009, an IDC report indicated that there were about 28 new handset vendors in India. Nokia led with a 54.1% market share in the fragmented Indian market, while the new vendors accounted for 17.5%. Samsung and LG followed with markets shares of 7.7 percent and 5.4 percent respectively.
• Nokia’s manufacturing facilities in India: Nokia’s manufacturing facility in Chennai, Tamil Nadu (South India) exports half its production to more than 59 countries. Nokia has invested $250 million since its launch in 2006.
• Mobile Microfinance – In 2009, Nokia piloted a scheme in two Indian states where it sold handsets on a weekly installment of 100 rupees ($2) over 25 weeks. Nokia planned to rollout the microfinance offer in 12 Indian states.
• India not a low-end market segment – 81 percent of the India’s mobile users are in urban areas. Nokia anticipates such customers would drive demand for high-end phones.
• Increasing Competition from new mobile handset manufacturers’ entry into India: In one quarter of 2009 alone, twenty-seven new mobile handset manufacturers entered the Indian market to introduce entry-level models (and other models with features such as dual SIM cards and full QWERTY keyboard) for the price sensitive Indian consumer.
• Mobile handset sales in India: By year ended June 30, 2009, mobile handset sales in India was 100.9 million compared to 94.6 million, a year ago.
• Nokia’s strong distribution in India: In India, Nokia has 2 lakh retail outlets and 700 support centers across 400 cities and towns.
• Nokia’s competitors in India: Motorola, Sony Ericsson, Spice, MacroMaxx, Karbonn, Lava, Lemon, Oscar.
  Maxx Mobile – In less than two years after entering the Indian mobile phone market, Maxx Mobile captured around four percent market share by offering around 45 models and having a presence across India with its 500 service centres. With such a strong distribution network the company wants to increase it market share to about 10 percent in the next two years (by 2012). In 2010, ‘Micromax Mobiles’ was second on the list of fastest rising search terms and the fourth most searched brand name on Google India website (Zeitgeist 2010).
• Nokia’s ‘Made for India’ phones: In 2000, Nokia introduced the Nokia 3210 with a Hindi menu. In 2003, Nokia launched the Nokia 1100, a first Made for India phone.
• India’s Most Trusted Brand: Nokia ranked as India’s topmost trusted brand in the The Economic Times-Brand Equity’s annual ‘Most Trusted Brands’ survey for 2010. In 2004, Nokia ranked 71 and moved to 44 in 2006 as India’s most trusted brand. In 2007, it ranked in the top ten at number 4. Nokia has since held the number one slot for three years consecutively.
• Nokia’s biggest advertising/marketing campaign in India: In December 2011, Nokia launched its biggest ever campaign in India called the ‘The Amazing Everyday’. The idea behind Nokia’s global campaign is to engage customers with the idea that “hidden away in the everyday landscape are billions of little adventures”.

This case study/article, titled Nokia’s Business Strategy in India, was originally published at Casestudyinc.com.

This case study/article, titled Nokia’s three-way strategy to capture the mobile music segment, was originally published at Casestudyinc.com.

McDonald’s in India

McDonald’s was launched in 1996 in India and has established itself as the family’s favorite quick-service restaurant. According to estimates, McDonald’s stores have an average of 2,750 walk-ins in each of the 155 stores. India counts itself amongst the top 10 per cent of the busiest markets for McDonald’s anywhere in the world. In India, McDonald’s had decided not to launch its beef-based core product – the hamburger – so that it didn’t hurt religious sentiments of the Hindus.

The Strategy – Building awareness among citizens

The strategy is simple. Delhi has approximately 40 lakh electors between the age group of 18-29. McDonald’s is popular among the younsters and catchy slogans and messages will encourage them. McDonald’s India wants to support the task of building awareness amongst citizens and remind them of exercising their right to vote.

Related Reading:
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This case study/article, titled Corporate Social Responsibility (CSR) and McDonald’s, was originally published at Casestudyinc.com.

• A $1.1 billion savings plan in its electronics division
• Cutting 16,000 jobs
• Pulling out of businesses and limiting investment for savings of almost 100 billion a year

Analysts believe the company needs more and bigger restructuring measures to improve its slowing sales and inventory pile-ups. Another challenge Sony has been facing are cultural clashes between its Japanese, US, and European operations. Restructuring moves would imply changing many of its long-established business practices (the Japanese business culture which is so deeply connected to its social culture). The restructuring plans include shutting down of some of its major divisions in its Japanese domestic operations. How Sony would go about facing these challenges and are more restructuring moves imminent amidst the financial crisis and lower consumer demand? Sony’s first non-Japanese CEO, Sir Howard Stringer sure has his task cut out.

This case study/article, titled Restructuring challenges at electronics giant Sony, was originally published at Casestudyinc.com.

In October 2008, Nokia, the world’s largest mobile phone maker launched a brand new campaign with the tagline ‘It’s not just a phone, it’s who we are’.

Nokia selected Priyanka Chopra, former Miss World and current Bollywood actor, as the Brand Ambassador. The company believes the young actor’s brand association will create a deeper connection with its young and style-savvy consumers and the new ad capmpaign featuring her will represent style, modernity and individuality. The TV campaign would be integrated with other consumer touch points like print, outdoor, radio, online and digital media.

Nokia’s other brand ambassadors include Bollywood’s leading actor – Shahrukh Khan. The company has already planned to bundle exclusive content featuring the actor for handsets sold in India. His movie ‘Om Shanti Om’ movie was recently bundled in Nokia N96.

New Indian factory

In October 2008, Nokia Siemens Networks, the second-largest network gear provider in India after Ericsson, announced that over three years it will invest $70 million in a new Indian factory in Chennai (south of India). The unit will make and distribute mobile communication equipment. Nokia Siemens already has a manufacturing facility in Kolkata in eastern India, where it makes fixed network equipment.

Also, in October 2008, Nokia’s handset manufacturing unit in Tamil Nadu (with over 8,000 workers) reached production volume of 200 million handsets within just three years of starting operations. Around 50 per cent of the production is sold domestically and the rest is exported. Nokia has two manufacturing units in China.

Nokia has a 62.5% market share in India while Samsung, the second major player with Aamir Khan (lead Bollywood actor) as the brand ambassador, has a 8% share.

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Article on Nokia’s Strategy in the Emerging Markets

This case study/article, titled Nokia’s new Brand campaign and Manufacturing in India, was originally published at Casestudyinc.com.

In 1994, China had 1.5 million subscribers across the country. Also in 1994, China transitioned from an analogue network towards a digital Global System for Mobile communications (GSM, originally Group Special Mobile) system. In 1998, Motorola, Nokia and Ericsson had 83% market share. Also in this year, Kejian introduced its (first local mobile brand) GSM mobile phone.

Keywords: Nokia in China, Domestic and foreign cell phone players in China, Nokia entry strategy in China, Chinese mobile phone market

Download Case Study: Nokia’s Business Strategy in India

This case study/article, titled Nokia and its Growth Strategy in China, was originally published at Casestudyinc.com.

What is Nokia’s Business Strategy and Expansion Strategy in India is an interesting discussion.

Nokia India,Indian Mobile Phones Industry, CDMA, GSM, Marketing Strategy, Marketing Mix

Nokia Headquarters: Finland
Industry: Telecommunications

Nokia Businesses and Products
home satellite systems
wireless switching equipment
wireless systemsmobile gaming devices
set-top boxes
wireless data and voice devices

Nokia Facts

• Nokia was founded in 1865 as a wood-pulp mill
• Nokia was founded by Fredrik Idestam.
• The name Nokia originated from the river which flowed through the town of the same name (Nokia).

Download [pdf format] Case Study: Nokia’s Business Strategy in India

This case study/article, titled Nokia Business Strategy India, was originally published at Casestudyinc.com.

In a case study method or a real life business situation, there exist many strategic alternatives. But selecting a particular strategy which satisfies both corporate and stakeholder objectives is a crucial part of any strategic process. This usually involves a tradeoff in the ultimate corporate goals to be achieved. This is usually a very complicated task. Even Swaps is a logical and an easy technique for making relevant trade-offs that help a manager in making a decision to consider the importance of one goal relative to another keeping in mind future scenarios. By indicating the absolute changes in the corporate goals, the real value of the strategic alternatives can be easily ascertained.

This case study/article, titled Even Swaps: A basis for business/corporate strategy selection, was originally published at Casestudyinc.com.