Strategic Management and Marketing

Question: Discuss about theStrategic Management and Marketing. Answer: Introduction In order to successfully implement the desired marketing strategies to acquire a prominent position in the competitive global business market, the business organizations are increasing focus upon improving their strategic marketing management processes. In this essay, the strategic marketing analysis of Fonterra Co-operative Group Limited has been analyzed which seems to be the largest daily producer company of New Zealand. The vision, mission and strategy of this organization have also been described along with its position in the competitive market which is supported by the Porters five force analysis. Moreover, the related data of the vision, mission and strategy of Fonterra are also presented through a diagram in order to give a clear view about them. Research Vision, Mission, Strategy of Fonterra Vision and Mission The vision of Fonterra, as per the view of Chowdhury (2013), is to maintain their goodwill and brand image among their consumers by improving the quality of their dairy products. The natural source of milk of Fonterra tends to increase its reliability among its consumers all around the world (McFarlane, 2013). The main vision of this organization is to secure maximum profit amount by providing the best quality dairy products to its consumers. By sharing their authentic value, it tries to strengthen its brand image among its global consumers. According to David, David and David (2015), in 2014-2015, Fonterra is supposed to be the most trusted dairy nutrition source of the world. From the financial budget of 2015-16, it is observed that this organization has secured around NZ $ 18.02 billion revenue along with a profit rate of NZ $ 920 million. In 2016, it has market value of NZ $ 17 billion. By 2015, it aims to secure revenue of NZ $37 billion along with developing 32 billion liter milk pools in Australia, New Zealand, China, USA, Europe and Chile. This organization has regarded Latin America and Greater China as the two most prominent potential sources of cash flow (Fonterra.com, 2013). This organization aims to indulge in multi-hubs for which it has developed global partnerships and in seeding markets for which some countries are identified like Ethiopia, Myanmar, Iraq and Azerbaijan. In order to maintain the share in global dairy market, Fonterra mainly focuses upon four countries such as Sri Lanka, Myanmar, Chile and New Zealand, while it has selected China, Brazil, Indonesia and Australia, insofar as the securing revenue amount is concerned (Fonterra.com, 2013). Image: Diagram of the vision, mission and strategy of Fonterra (Source: Created by self) Strategy The main strategy of this organization seems to regard the price of the milk along with the return on capital insofar the market potentiality is concerned. In order to maintain their desired sales rate, this organization aims to improve their reputation among their consumers along with developing engagement with them (McFarlane, 2013). In 2015, this organization has taken V3 strategy which indicates to the increase of value, velocity and driving volume with the help of seven different strategic ways such as the increase of the milk sources in New Zealand, increase of the current position of its consumers through expansion, further development of Anlene business, increase of the foodservice potential, cautious investments in the milk pools, acquire prominent position in the maternal and child nutrition market and proper arrangement in the organization for the better implementation of these strategies (Fonterra.com, 2013). In order to properly execute their determined strategies, this organization aims to follow certain specific actions like proper allocation of the resources, the accurate identification of underperforming business centers, exact execution of their plans by improving their customer focused performance. By the proper distribution of the capital, this organization tries to ensure their potential to take new initiatives so that they can improve their production rate along with the quality of their product (Omotayo, 2015). On the other hand, the identification of underperforming dairy firms can minimize their chance for further financial loss. In this way, they aim to identify the reasons behind this failure and taken necessary action for solving this problem (Trivedi, 2013). By employing customer focused service, Fonterra tries to build a healthy relationship with its consumers so that they can regard their products foremost among the other dairy products. Analysis and Explanation of the Competition Level in the Market for Fonterra As per Ilieska (2013), Porters five force is one of the best marketing strategy with which the business organizations can effectively analyze their position in the competitive market. It also helps to identify the potentiality of Fonterra among other daily manufacturers of New Zealand namely United Dairy NZ Ltd, Taranaki Milk Products Ltd, Open Country Dairy Ltd etc. New Entrants From the viewpoint of Iyamabo and Otubanjo (2012), Fonterra is facing a threat about the emergence of new entrants in the competitive dairy market of New Zealand. Plenty of supply sources along with low purchase rate attract various other dairy manufacturers who only tend to indulge in export businesses. On the other hand, global dairy farms like Nestle etc also prefer low cost supplier country like New Zealand from where they can acquire sufficient amount of milk at cheap costs. Suppliers This organization seems to produce around 2.5 million tons dairy products with the help of around 17500 dairy farmers of New Zealand who are also the shareholders of this company (Khan Khalique, 2014). The trustworthy and strong sources of milk seem to be one of the strength of this organization from which almost 94% are exported all around the world to fulfill the huge demand for dairy products. This organization also ensures this huge supply at a lower rate by building a healthy relationship with the farmers (Kosan, 2014). Fonterra also tries to apply technologies at their dairy farms so that they can increase the production with which they can expand their business to their desired countries like China, India etc. In order to meet the high and growing demand of fresh dairy products, at the China branch of Fonterra, a pilot farm seems to be developed. It seems to have around 6200 cows among which almost 3256 are indoor kept with which this branch aims to produce double amount of m ilk than its present production (Fonterra.com, 2013). Buyers Due to the rapid changing food habits of the consumers, Fonterra is facing growing difficulty regarding the maintenance of the prices of its products. The system of demand and supply of dairy products also gets interrupted because of its consumers (Leeflang et al., 2014). In order to fight this obstacle, this organization has developed a new online selling website of its different dairy products like milk, butter, yoghurt etc where it can easily change the prices of its products in accordance with the changing demand and supply system. Substitutes During the present craze of health consciousness, consumers tend to opt for other substitutes for the natural milk products (Iyamabo and Otubanjo, 2012). The rapid growing illness like blood pressure, cholesterol etc, people aim to consumer low fat processed dairy products like goat milk, soya milk, power milk etc which seems to affect the immense demand and popularity of natural milk product (McFarlane, 2013). Due to this reason, the profit level of Fonterra seems to be get affected. Internal Rivalry In the recent competitive market, Fonterra faces threats not only from its competitors at its home country, New Zealand but also from its global competitors namely Kraft, Nestle etc because they are rapidly taking the major positions in the share market. Fonterra seems to be the merger of two giant dairy organizations of New Zealand such as Kiwi Co-operative Dairies and New Zealand Dairy group which strengths its marketing strategies and also increases its profit rate. However, it also faces trouble with the fast changing global marketing strategy with which they try hard to be accustomed (Skokan, Pawliczek Piszczur, 2013). On the contrary, in 2015, Fonterra aims to show its potential in the global market by acquiring two new businesses such as dairy dessert and yoghurt in Australia from one of its major competitor, Nestle as it faces difficulty to maintain its milk supply from the dairy farmers. Conclusion In this way, the strategic marketing management of Fonterra has been analyzed by vividly describing its vision, mission and strategy with which this organization aims to increase their daily production that can also cause a hike in the sales and profit rate of this organization. With the help of the specific diagram involving related data about the vision, mission and strategy of Fonterra helps to have better view on this subject. On the other hand, detailed Porters five force analysis also helps to have a better view about the competitive market position of this organization. Reference List Chowdhury, P. P. (2013). Key strategies and issues of positioning: A review of past studies.American Academic Scholarly Research Journal,5(1), 55 David, M. E., David, F. R., David, F. R. (2015). Mission statement theory and practice: A content analysis and new direction.International Journal of Business, Marketing Decision Science,7(1), 95-110 Fonterra.com, (2013), Fonterra, Available from: https://www3.fonterra.com/nz/en/about-us.html [Retrieved on 16 Feb, 2017] Ilieska, K. (2013). Customer Satisfaction Indexas a Base for Strategic Marketing Management.TEM JOURNAL,1(2), 327-331 Iyamabo, J., Otubanjo, O. (2012). A Three-component definition of strategic marketing Khan, M. W. J., Khalique, M. (2014). Strategic planning and reality of external environment of organizations in contemporary business environments Kosan, L. (2014). Accounting for Marketing: Marketing Performance Through Financial Results.International Review of Management and Marketing,4(4), 276 Leeflang, P. S., Verhoef, P. C., Dahlstrm, P., Freundt, T. (2014). Challenges and solutions for marketing in a digital era.European management journal,32(1), 1-12 McFarlane, D. A. (2013). The strategic importance of customer value.Atlantic Marketing Journal,2(1), 5 Omotayo, F. O. (2015). Knowledge Management as an important tool in Organisational Management: A Review of Literature.Library Philosophy and Practice, 1 Skokan, K., Pawliczek, A., Piszczur, R. (2013). Strategic planning and business performance of micro, small and medium-sized enterprises.Journal of Competitiveness,5(4).p.550 Trivedi, J. Y. (2013). A Study on Marketing Strategies of Small and Medium sized Enterprises.Research Journal of Management Sciences ISSN,2319, 1171