CASE STUDY 1 Essay Example
CASE STUDY 1
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3CASE STUDY 1
CASE STUDY 1
RJB Nabisco is among the leading companies in the sale of Tobacco and related products and services. Since its development, the company has undergone several changes aimed at being the best in the market. One of the most significant reasons for these changes is competition. Several companies dealing with the same products have incorporated various strategies aimed at achieving the best. Partnership and product differentiation is one of the most significant strategies applied by RJB Nabisco. They realized by partnering with other best companies in the business they will accomplish their goals and objectives effectively. As well, they introduced four different products to the market at once despite the risk involved in such a strategy. These strategies enabled the company to increase their sales, productivity, growth and development in the global markets.
RJB Nabisco began in 1875 as a Tobacco company. However, it remained this way primarily until 1967. This was when RJR Foods subsidiary was formed, and other acquisitions were made. The approximated company sales in 1987 were $15.8 billion while assets stood at $16.9 billion. The leading cigarette brand names included Winston, Camel, Salem and Vantage. The tobacco business as well included products such as Planters nuts and LifeSavers candies. As well, initially, the food business encompassed several firms. These included Chun King oriental foods, Davis baking powder, Patio Mexican dinners, and Vermont Maid syrup. The case study thus analyzes various issues concerning the companies risk management. It is evident that the tobacco businesses face various challenges and risks. However, the company has successfully thrived in this market. As a result, they are making massive sales annually. In addition to the above, they have substantially outshined other competitors in the competitive market. This is due to their practical strategies for managing the risks that exist in the daily operations of the organization.
One of the main problems that have was faced by the company concerns leveraged buyouts. This is one area that did not attract much attention. It is not only considered as the largest LBO on record but also features experienced players. This is a complicated set of innovative financial instruments. The central issue of focus was to increase the consumption of tobacco products across the globe. This is the period that they had to make a risky move of introducing four brands simultaneously. The main issue why the company made his risky decision was to increase the sales (Michel & Shaked, 1991). As a result, this could lead to the growth and expansion of the company in several ways. However, we consider the step that they took as a precarious move. This is because the management of the company was not sure whether the outcomes will be beneficial or destructive. Luckily, the consequences of the decision turned out to be successful.
The next problem that the company faced was competition. Several companies were competing in the market of tobacco businesses. This led to the increased competition pressures. As well, to come up with the best decisions to survive the competitive markets, there was a need for enough finances. For instance, introducing different brands at once required a good amount of finances.
The central issue that substantially affected the company was growth and development. The company wanted to increase their sales significantly. The management realized that there was no other option but to introduce other tobacco brands in the market. This occurred in 1913. The riskiest decision made was to introduce four different brands simultaneously. Despite the fact that this was considered as a risky move, it yielded beneficial results. Among the brand that was introduced to the market included Camel. This is one of the brands that substantially changed the history of the company. The report indicates that after one year, four hundred and twenty-five million Camel brands had been sold to the consumers across the globe. However, to ensure this was possible the company incorporated two great strategies. Firstly, they ensured that the production process is innovative. This means that the products produced were very different in the markets. The second approach used was the use of advanced marketing techniques. They ensured that the adverts were well developed. As a result, they provided that such ads are attractive and eye captivating. This resulted in an overall increase in the sales. This led to the company enjoying fifty percent of the market share (Michel & Shaked, 1991).
The other way in which the company substantially outshined the competitors was the use of product differentiation. This is one of the most applied strategies currently. As well, they diversified their markets. For instance, they also engaged is selling non-cigarette products. Finally, they also focused on selling their products online. Based on these approaches taken by the company, it is profound to note that there are some alternative solutions that the company can take. Firstly, marketing is the center of every operation of the enterprise. One way in which successful commercialization of the products can be achieved is to employ competitive and qualified marketing professionals. These are the people who will go out and market the products to the potential customers around the world. As well, they are involved in making crucial decisions concerning marketing. In addition to the above, these professionals analyze the global markets and advice the management on the better techniques to apply (Michel & Shaked, 1991).
The second alternative is to use the modern marketing strategies. Several marketing strategies have been introduced. This is mainly due to the advancement in technology. One of the main used marketing techniques is digital marketing. Several online platforms house potential customers across the globe. One of the main forms of these online platforms is the social media. Social media platforms such as Twitter, Facebook, LinkedIn, and WhatsApp are populated by the potential customer. Therefore, there is a substantial need for the company to register its presences in such platform. There are several advantages associated with this strategy. Firstly, numerous people can easily be accessed online. Therefore, the company will easily access these potential clients. Secondly, the use of social media platforms is relatively cheaper as compared to other marketing options. For instance, the company will just need to design ads and post them online. This is relatively cheaper as compared to creating ads and taking them to strategic places to be viewed by potential customers. Finally, social media is an easier way to source information from the customers, potential investors and other interested parties. For instance, the customers comment on the products that are being marketed. The company takes this feedback information from the clients and utilizes them effectively. The information can be used to improve the quality of the products and services offered by the company.
It is evident that the primary purpose of the company is to increase the sales and hence increase the profitability. Therefore, several approaches can be applied to ensure that this is achieved. One of the most significant approaches is to ensure that quality products as services are provided. One strategy that the company made this to happen is to introduce four different brands to the global markets. This is broadly known as product differentiation. Despite that the approach was risky, it worked out well. It led to increased sales and hence profitability of the company. As well they incorporated innovation in their products. Innovative products captivate customers and also enable the company to outshine the competitors. Another approach used by the company was designing and application of better marketing techniques. For instance, they renovated their marketing techniques to ensure that they reach a large number of customers. Finally, focusing on global markets played a substantial role in the success of the company. It increased the number of companies’ clients. This resulted in increased sales. As a result, the profit levels, growth, and development of the company substantially improved. The company thus achieved most of its set goals and objectives (Michel & Shaked, 1991).
The most significant recommendation for the company is the adoption of digital marketing strategy. This is one of the most applied techniques by the most successful companies across the globe. Technology has played a crucial role in transforming the business world. Company operations have been substantially enhanced thanks to technological advancements. Therefore, it is imperative that the company incorporates digital marketing in its operations. There are several platforms as earlier stated in the case study that can enable the company to market its tobacco and other products. One of the most significant of these is the social media platforms such as Twitter and Facebook. These are the platforms that are dominated by numerous potential customers across the globe. The approach is cost effective since the company can easily access thousands of customers. As well, the platforms enable the company to obtain valuable feedback from the customers and other stakeholders. The company, therefore, must consider registering their online presence as an efficient technique of marketing its tobacco and non-tobacco products.
Implementation of the recommended strategy is a simple task. However, this must be done professionally to ensure maximum benefits are yielded by the strategy. The key thing required is the company to purchase the necessary technology and infrastructure. For instance, the company must purchase enough computers to be used in the digital marketing process. Secondly, the company must also employ the necessary Information Technology personnel. These are the people who will ensure that the hardware and software technology works effectively and efficiently. As well, they will be responsible for posting and updating the ads online.
Michel, A., & Shaked, I. (1991). RJR Nabisco: A Case Study of a Complex Leveraged Buyout. Financial Analysts Journal, 47(5), 15-27.
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