The art of positioning
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The art of positioning
Indonesia has had a turbulent history, which did not always affect trade and export in a positive way. The dominance of the Dutch and Japanese, and the dictatorship of Soeharto have lead Indonesian people to be real followers. They are not used to thinking for themselves, and do not have an entrepreneurial nature.
This report is based on the following research questions: What is an appropriate way to position the new product line in the European market? After different analyses an answer to this question will be formed.
In the internal analysis the 'following' attitude results in weakness in the organizational culture within Euro Design. There is not much that can be done to improve these cultural difficulties, but try to adjust leadership style and management in such a way that the cultural problems are handled as well as possible. The main
strength of the company can be found in the high quality standards in production. Changing trends and the use of marketing and communications for example offer opportunities.
The external analysis gives insight in changes in environment, customers and stakeholders and competition. It shows that the environment is unstable at some points, for example the quirks of a corrupt government and the current economic situation. The the current economic crisis is the biggest outside threat at the moment. The recession makes orders decrease while oil prices and other materials get more expensive. Another threat is the competition. There are strong competitors that produce the similar products, and operate on the same market.
Analysis of companies that showed interest at the furniture trade fair Euro Design participated in, together with analysis of the potential customers in Europe, showed that Euro Design should target the middle- to highend wholesalers and small exclusive stores. Competition turned out to be as fierce as predicted, and showed
that most competitors are based in the Philippines. They try to focus on being a flexible organization that can anticipate and respond to changes in the environment. European companies are not competitors yet, because of their lack of experience and lower quality standards. This difference in quality also means that these companies target a different segment of the furniture market, which is another reason for not analyzing this group.
Euro Design targets a familiar market but with new products, and mainly to new clients. Changes on this market are mostly caused by economic developments, and changes in trend. This means Euro Design is located in the product development category in the growth strategy.
When putting the substance of the SWOT analysis in a confrontation matrix, it turns out that Euro Design does not have much influence on minimizing weaknesses and threats. Combining the strength of high quality products with the opportunities that lies in marketing and media plus customers leaving China creates a big chance. Quality standards in China have proven to be inadequate, and Chinese style is not a trend anymore. By promoting their image of being reliable and producing high quality products, Euro Design could pick up some of
the orders that were previously going to China.
Euro Designs production process is not adaptable to mass production. This combined with high quality standards and high prices these two factors cause, makes it logical that Euro Design will target the middle- to high-end segment of the European furniture market. Their main target group will consist of high-end furniture stores,
and wholesalers that supply to this category of stores.
One of Euro Designs opportunities is using marketing and communications to their full potential. Until now, activities in this area were very limited, but by employing a marketing manager and preparing to form a marketing budget Euro Design makes a serious attempt in exploiting this chance. Writing down marketing plans
increase their results, which is why a marketing- and exportplan was created.
The most efficient way to market the accessories line is using different media. In Euro Designs strategy, a brochure, website, advertising online, direct marketing, advertising in magazines and participating and advertising at furniture trade fairs are combined. The internet is used extensively, mainly because of the low
prices versus the wide reach, and the possibility to create and manage this medium from Indonesia.
What can be concluded from this research is that Euro Design is in a good position to successfully export their home accessories line and become a strong competitor in the middle- to high-end European furniture market, provided that the company makes some changes in their marketing strategies and uses the tools that are given to them in this essay.