Customer Segmentation In Business To Business Markets Case Study Solution and Analysis
Intro
Customer Segmentation In Business To Business Markets Case Study Analysis is the biggest publishing business with a highest market share in the China's book retail market. CMP has actually become a specialized info supplier and a large extensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Critical Issues
Although, Customer Segmentation In Business To Business Markets Case Study Analysis has spent its 60 years journey smoothly, being a successful publishing home, nevertheless, the altering macro market patterns and forces bring particular obstacles to the publishing industry in general and CMP in particular. These factors include;
• Entryway of the new publishing companies in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Improvement of science and innovation.
The improvement of the macro markets have raised several questions to the management at CPM that what could be the future of CMP in this circumstance? Do the long important experience, technical resources and the abilities of the business could be utilized to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Customer Segmentation In Business To Business Markets Case Study Help has specific strengths that can be used to decrease the threats, overcome the weak point and obtain the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Customer Segmentation In Business To Business Markets Case Study Help in the publishing market i.e. 60 years permits the company to supply high quality items at a lower expense utilizing its previous experiences.
• The technical resources and abilities produced by its effective journey offer a competitive benefit to CMP.
• Vast item portfolioof CMP helps it to diversify its threat and supply high worth to its clients.
• Strong financial position allows the company to think about several development chances with no fear of raising fund externally.
Weaknesses
Together with the strengths, the business has particular weaknesses which could increase restrictions for the company in implementing its development program. The weak points of Customer Segmentation In Business To Business Markets Case Study Help are given as follows;
• Despite of being a science and innovation publishing company, the company still has standard methods ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It ought to propose specific growth strategies to avoid its dependence over the Chinese markets to accomplish long term growth.
Opportunities
The growth of the publishing industry is declining given that 2008, affecting Customer Segmentation In Business To Business Markets Case Study Help as well, however the development could be revived by availing particular opportunities provided in the market. The market chances for CMP include;
• The company might also present Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP could think about an advancement program through the growth towards foreign markets in order to decrease its dependence over Chinese markets by using its large funds.
Dangers
The altering macro trends in the market and increasing competitors in the publishing industry has actually presented specific threats to Customer Segmentation In Business To Business Markets Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could lead to declining market share of Customer Segmentation In Business To Business Markets Case Study Analysis due to the customer shift towards digital libraries.
• The existence of a great deal of competitors in the publishing industry increase the risk for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by utilizing particular methods like aggressive promo, quality items, etc.
• Entrance of new publishing companies in the market together with presence of high competitors increases the threat of losing the client base.
Financial Analysis.
Due to absence of information, the monetary ratios of CMP might not be calculated. It could be evaluated from the Appendix III that the annual total profits of Customer Segmentation In Business To Business Markets Case Study Help during the duration 2000-2012 are growing at a high development rate, showing that the yearly need of the items of CMP is growing and the business is quite efficient in bring in a large number of consumers at a potential price.
In addition to it, the second graph which shows the yearly development in the Customer Segmentation In Business To Business Markets Case Study Analysis overall possessions, shows that the company is rather effective in adding worth to its possessions through its incomes. The growth in assets shows that the total value of the firm is likewise increasing with increasing the overall incomes. (Unidentified, 2013).
Another financial analysis of the business using the given information might be the analysis concerning the distribution of overall incomes of the company. Huge part of the revenues of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company could move towards other service sectors with a possible development to attain its future development objective.
PESTEL Analysis
PESTEL analysis might be performed to discover the numerous external forces impacting the efficiency of the company and the recent patterns in the external environment of the business. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable effect on the state of mind of the people about the communist ideology of the government, therefore, the publishing sector is highly supervised and guided by the Publicity Department of the Communist Celebration of China. It might be said that the general political forces impacting CMP company are high. The federal government policies regarding the publishing sector are also increasing with the passage of time.
Cost-effective.
Financial forces impacting the publishing sector in basic and the Customer Segmentation In Business To Business Markets Case Study Help in particular includesthe rates of paper, the income level of customers, the inflation rate, and the overall GDP growth of the nation. All these forces integrate impact the need for the publishing market. Along with it, the financial policies connected to the import of books impact the overall organisation at CPM. China's economic conditions are quite favorable for CMP with high GDP growth and consumer income level.
Social and Demographical.
Social and demographical forces consist of the population growth, the consumer's choices towards checking out useful products and so on. China has the greatest population in the world with a high population development, revealing the increasing variety of consumers of the Customer Segmentation In Business To Business Markets Case Study Analysis. However, the customer choices are shifting towards digital publishing instead of the standard was of publishing. In this regard, CMP needs to concentrate on digital publishing to meet the altering customer choices.
Technological.
Technological forces affecting the CMP consist of the technological development in the reading techniques and so on. Improvement of science and innovation in addition to the rise of digital publishing might lower the need for the CMP items, if certain actions would not be taken quickly.
Environmental.
Environmental forces affecting Customer Segmentation In Business To Business Markets Case Study Analysis consists of the issues of environmental neighborhoods over the use of paper in publishing books. The paper utilized in the books while publishing is required to be disposable and the ink used while publishing ought to not be harmful for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. Publishing Regulation 1997 requires the publishers to be authorized first by the Government to be entered in the publishing market.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Model might be used to examine the attractiveness of the publishing industry China. A short analysis of the Porter's Five Forces is provided as follows;.
Threat of New Entrants.
Hazards of brand-new entrants in the Chinese Publishing Market is moderate. The possible growth in the market tends to attract brand-new entrants to the publishing industry. Nevertheless, the existence of intense competitors and the requirement of substantial capital tends to demotivate brand-new entrants to enter in the market.
Risk of Alternative.
Risk of Replacement is high for the Chinese Publishing Market. The replacement items for the published files is the files provided in the virtual libraries on specific websites. The altering customer preferences towards digital learning increase the danger of replacement for the industry.
Competitive Rivalry.
Competitive competition in the publishing market is high. The existence of a great deal of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, brand-new entrants are likewise entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the Customer Segmentation In Business To Business Markets Case Study Solution include the suppliers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing market is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the buyers requires high quality documents at competitive costs.
Competitors Analysis.
CMP operates in an extremely competitive market with the existence of a great deal of rivals. Nevertheless, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Major rivals of Customer Segmentation In Business To Business Markets Case Study Help include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a risk for CMP as it could wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the market share of CMP quickly in the current market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the very same period as Customer Segmentation In Business To Business Markets Case Study Analysis and CIP. It is likewise one of the popular players in the publishing industry with a yearly total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing number of Clients
• Growth opportunities.
• Avoiding the impact of market saturation in the Chinese publishing market.
Cons
• Usage of prospective resources in growth.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to present utilizing existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio provides high value to customers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sectors to the new one can lead the company to lose demand of its items in the market.
Suggestions
As the choices are shifting towards digital publishing and the company need an instant service to prevent the decreasing market development. The business could also consider the growth program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its item portfolio, the business ought to initially collects the information related to the customer need, the prospective markets, the government regulations and the data related to the rivals provided in the market. If the preliminary offering proves a success, the company should go for the other markets. In this way the company would be able to execute its digital publishing program.
Conclusion
The growth of the publishing market is decreasing considering that 2008, revealing a hazard to the company's long term existence, however the situation can be controlled by considering an advancement strategy in the future. The company could think about introducing digital publishingin its existing market to execute its development program at immediate basis and to avoid the danger of failure for entrance in the new markets.
