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Light Bulb Wars

Extracts from this document...

Introduction

BA International Business Communication 2 MKT601 MARKETING & COMMUNICATIONS In Module Assignment 2007-8 Light Bulb Wars Case Study Written By LI YONGKANG Student ID: 11372189 Page: 20 pages Word Account: 2895 words Contents 1.0 Introduction - 1 - 1.1 Purpose statement - 1 - 1.2 Terms of reference - 1 - 1.3 Background of the BLBC.........................................._1 2.0 Situation Analysis - 2 - 2.1 The trend of global market - 2 - 2.2 Pestal anaysis of the EU - 3 - 2.3 Evaluating the market..............................................._5 3.0 Marketing Strategy - 6 - 3.1 Strategic Business Unit............................................._6 3.2 Ansoff's and Boston Matrix........................................._8 4.0 Marketing Philosophy - 11- 4.1 Marketing Philosophy Concept.................................._11- 4.3 Social Marketing Concept..........................................-12- 5.0 Recommendations of marketing mix .....- 13 - 5.1 Product.................................................................-13- 5.2 Promotion..............................................................-14- 5.3 Price.....................................................................-14- 5.4 Place....................................................................-15- 6.0 Conclusion................................................................._15 Appendix 1 ......-16 - Referencing........................................................................_17 Bibliography........................................................................_18 1. Introduction 1.1 Purpose statement The report will outline the business condition of BLBC, which encountered the Gordian knot in their marketing operation as they looking for some effective solutions and practical advices that could make the company grow and develop under a steady and sustainable circumstance. 1.2 Terms of reference This report identified and analyzed the major factors that are forcing the current market, including the global and EU market. And recommends and justifies the possible adjustment and solution, which covers the situation analysis, environment analysis, strategic directions and marketing mix area and its method. 1.3 Background of the BLBC Beijing Light Bulb Company (BLBC) has sold incandescent filament light bulb for 25 years, the company owns light bulb factory with the current capacity to produce 40 million incandescent light bulbs a year. 2.0 Situation Analysis 2.1 The trend of global market: Incandescent bulbs (IBs) are identified as the most common bulb used prevalently today since they are inexpensive and widely available. However this kind of light bulb has been remarkably ineffiencient. Many government and NGO's (Non-Government Organizations) ...read more.

Middle

As we can predict, during 2 or 3 years, high market share of IBs could still bring a good profit earning to BLBC. There is no doubt that BLBC have to hold the IB's share at the current level, and use excess money to develop a new SBU. 3.2 Ansoff's and Boston Matrix Before analysis CFLs and LEDs, another important portfolio analysis method could be added in, use together with Boston Box, Ansoff's Matrix. Ansoff's Matrix is a tool that helps business decides their product and market, growth strategy. "Growth is pure Oxygen."(Phillip, 2006) Every company need growth, BLBC needs growth as well. Analysis products via these two boxes, suggest the direction for the business strategy. Chart 3: As can be seen in the BOX( chart 3), both CFLs and LEDs located in the Question Marks, because they are both have a good growth rate but the market share still not high enough. However, CFLs looks has a better performance than LEDs. As we can see following: in 2004, nearly 13 percent of the 8.6 million light bulbs and tubes exported from China were CFLs. The overall value of all bulbs and tubes has grew 36 percent reach US$1.2 billion,staggeringly,65 percent of which came from shipments of CFLs, which has registered the highest growth rates among various bulbs from China, growing an average 40 percent in the past few years, CFLs are leading exports and booming business cause by more than 1,000 suppliers produce nearly 1 billion CFLs annually, about 75 percent in global market output: Meantime, LEDs are remarkable as a new-generation light sources which have been drew on some large suppliers board, but they still at a developing stage as manufacturers need advanced technology to producing LEDs, the year of 2005.18.4% growth rate raise in China's LED market, LEDs market continued its growth step in 2006,the market grew by 6% to $4.2 billion. ...read more.

Conclusion

During these trade fairs, companies can meet new customers come from different countries around the world; construct a relationship, hopefully for a long-term co-operation. Secondly, keep a good relationship with retailers, such as Wal-Mart, Ikea and Carrefour, they still keep selling BLBC's product in European market, this is called Selective distribution, which can develop good working relationship with selective selling members and expect a better-than-average selling effort. Good market coverage and less cost are strengthens of the company. Finally, directly sale to the EU market under "Golden Light" brand. Try to find more electrical wholesalers in different countries of the EU, distribute products to them, then resale to the other retailers of other EU countries. This is the conventional distribution channel, in this channel, each member seeking for the maximum profit, they cannot control other members, each of them is an intermediary, who can distribute BLBC's owned brand product to different segment market of the UK. If BLBS can operate this multi-channel marketing system efficiently and fully, there will be not doubt that BLBC will get a high market share quickly and develop steadily in the EU market. 6.0 Conclusion The specific recommendations are as follow. Maintain the IBs' market performance currently, make a full preparation for developing CFLs producing and the challenges form the EU market and balance the overall performance of BLBC. Appendix 1: Appendix 2: Incandescent light bulb vs. Fluorescent light bulb Estimated No. of Incandescent light bulbs used in Hong Kong households: 4,210,000 Incandescent light bulb Fluorescent light bulb4 Difference Electricity Consumed (kWh) 740 million 140 million 600 million Energy Cost HK$740 million HK$140 million HK$600 million CO2 emissions 590 thousand tonnes 110 thousand tones 480 thousand tonnes Referencing: Philip Kotler and Gary Armstrong, 2006, Principles of Marketing, 11th edition, Pearson Education, Inc., Upper Saddle River, New Jersey Peter Doyle and Phillip Stern, 2006, Marketing Management and Strategy, fourth edition, Pearson Education Limited E Davies and BJ Davies, 1992, Successful Marketing in a week, Copy right: Bell& Howell Company http://www.americanlightingassoc.com/members/files/03_07Lightrays.pdf http://sound.westhost.com/articles/incandescent.htm http://www.msnbc.msn.com/id/17364944/ http://www.news-record.com/apps/pbcs.dll/article?AID=/20070320/NEWSREC0101/703200305/-1/NEWSREC0201 http://www.greenpeace.org/china/en/press/release/greenpeace-urges-legal-phase-o http://www.okokok.com.cn/Abroad/Class123/Class131/200609/108912.html http://www.the-infoshop.com/study/su57506-brightness-led.html http://www.edn.com/article/CA513507.html http://www.worldwatch.org/node/4104 http://secreg.globalsources.com/sreg/SITE/LIGHTBULB/CSRTUBOVERVIEW.jsp?productcode=CSRTUB&dmsource=HP102BEA http://ca.news.yahoo.com/s/afp/071114/business/eu_eurozone_economy_growth http://en.wikipedia. ...read more.

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