Matchstick Inc Word Of Mouth Marketing B Case Study Solution and Analysis
Intro
Matchstick Inc Word Of Mouth Marketing B Case Study Help is the biggest publishing company with a greatest market share in the China's book retail market. CMP provides a number of services including; collecting info, processing info and interaction services. Major company sections of the company consist of; books, regulars, consultancy and circulation. The business has a large product portfolio and its major products include books, regulars, online media, exhibitions, research study reports and so on. Matchstick Inc Word Of Mouth Marketing B Case Study Solution has actually become a specialized information supplier and a big detailed Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
Crucial Concerns
CMP has spent its 60 years journey efficiently, being an effective publishing house, nevertheless, the altering macro market patterns and forces bring certain challenges to the publishing market in general and Matchstick Inc Word Of Mouth Marketing B Case Study Solution in particular. These elements include;
• Entrance of the brand-new publishing companies in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement of science and innovation.
The change of the macro markets have raised several concerns to the management at CPM that what could be the future of CMP in this circumstance? Do the long valuable experience, technical resources and the capabilities of the business could be made use of to strive for the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Matchstick Inc Word Of Mouth Marketing B Case Study Solution has particular strengths that can be made use of to decrease the dangers, get rid of the weakness and get the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Matchstick Inc Word Of Mouth Marketing B Case Study Solution in the publishing industry i.e. 60 years enables the company to supply high quality items at a lower cost using its previous experiences.
• The technical resources and abilities created by its effective journey offer a competitive advantage to CMP.
• Large item portfolioof CMP helps it to diversify its danger and offer high worth to its customers.
• Strong financial position permits the business to think about several development opportunities with no fear of raising fund externally.
Weaknesses
Along with the strengths, the business has certain weaknesses which could increase restraints for the company in executing its development program. The weaknesses of Matchstick Inc Word Of Mouth Marketing B Case Study Help are provided as follows;
• Despite of being a science and technology publishing company, the company still has standard ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It needs to propose specific expansion plans to avoid its dependence over the Chinese markets to attain long term growth.
Opportunities
The development of the publishing industry is decreasing because 2008, impacting Matchstick Inc Word Of Mouth Marketing B Case Study Analysis as well, however the growth might be revived by availing certain opportunities provided in the market. The market chances for CMP consist of;
• The business might also introduce Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP might consider a development program through the expansion towards foreign markets in order to minimize its dependence over Chinese markets by using its huge financial resources.
Hazards
The changing macro patterns in the market and increasing competitors in the publishing industry has postured particular dangers to Matchstick Inc Word Of Mouth Marketing B Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might lead to declining market share of Matchstick Inc Word Of Mouth Marketing B Case Study Help due to the customer shift towards virtual libraries.
• The presence of a great deal of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can gain a strong consumer base by using particular techniques like aggressive promotion, quality items, etc.
• Entrance of new publishing companies in the industry together with presence of high competitors increases the hazard of losing the consumer base.
Monetary Analysis.
Due to absence of information, the monetary ratios of CMP might not be computed. It might be examined from the Appendix III that the annual total incomes of Matchstick Inc Word Of Mouth Marketing B Case Study Solution during the period 2000-2012 are growing at a high development rate, showing that the annual need of the items of CMP is growing and the company is rather efficient in attracting a big number of customers at a potential price.
In addition to it, the 2nd graph which shows the yearly growth in the Matchstick Inc Word Of Mouth Marketing B Case Study Help overall properties, reveals that the business is rather effective in adding value to its possessions through its incomes. The development in properties shows that the total worth of the firm is also increasing with increasing the overall profits. (Unidentified, 2013).
Another monetary analysis of the business utilizing the offered information might be the analysis regarding the distribution of total incomes of the company. Major part of the revenues of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business might move towards other organisation sectors with a potential growth to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis could be conducted to find out the different external forces impacting the efficiency of the business and the recent patterns in the external environment of the business. A short PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable impact on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is extremely supervised and directed by the Publicity Department of the Communist Party of China. It could be said that the total political forces affecting CMP company are high. The government policies regarding the publishing sector are likewise increasing with the passage of time.
Economical.
Financial forces impacting the publishing sector in basic and the CMP in particular includesthe costs of paper, the earnings level of customers, the inflation rate, and the overall GDP growth of the country. All these forces integrate impact the need for the publishing market.
Social and Demographical.
Social and demographical forces include the population growth, the customer's choices towards checking out informative materials and so on. China has the highest population worldwide with a high population growth, showing the increasing variety of customers of the Matchstick Inc Word Of Mouth Marketing B Case Study Solution. However, the consumer choices are shifting towards digital publishing instead of the standard was of publishing. In this regard, CMP must concentrate on digital publishing to meet the changing customer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading techniques and so on. Enhancement of science and innovation along with the increase of digital publishing could lower the demand for the CMP items, if certain actions would not be taken soon.
Environmental.
Ecological forces affecting Matchstick Inc Word Of Mouth Marketing B Case Study Help consists of the issues of ecological communities over the use of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink used while publishing must not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be authorized first by the Federal government to be gone into in the publishing market. The regulation forbids direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's 5 Forces Model might be used to evaluate the beauty of the publishing industry China. A quick analysis of the Porter's Five Forces is offered as follows;.
Hazard of New Entrants.
Hazards of new entrants in the Chinese Publishing Industry is moderate. The possible growth in the industry tends to draw in new entrants to the publishing market. The presence of extreme competitors and the requirement of big capital tends to demotivate new entrants to go into in the market.
Danger of Replacement.
Threat of Alternative is high for the Chinese Publishing Industry. The alternative products for the released files is the documents presented in the digital libraries on particular sites. The changing customer choices towards digital learning increase the danger of substitution for the market.
Competitive Rivalry.
Competitive competition in the publishing market is high. The existence of large number of customers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are likewise entering into the market increasing the competition for CMP.
Bargaining Power of Supplier.
The significant providers of the Matchstick Inc Word Of Mouth Marketing B Case Study Analysis include the suppliers of the paper for releasing 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.
Bargaining power of purchaser in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers requires high quality documents at competitive rates.
Rivals Analysis.
CMP runs in a highly competitive market with the presence of large number of competitors. The business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Matchstick Inc Word Of Mouth Marketing B Case Study Analysis include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Founded in the very same duration, CIP publishes similar kind of books. For a large period, CIP held the biggest market share, and still ranks 2nd and 3rd in numerous market sections, with a major focus on instructional publications. CIP serves as a risk for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and could wean the market share of Matchstick Inc Word Of Mouth Marketing B Case Study Help easily in the present market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise established in the same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to business scale. It is also one of the prominent players in the publishing industry with an annual total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Minimizing dependence over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Usage of potential resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce utilizing present abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to clients.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service sections to the brand-new one can lead the business to lose need of its items in the market.
Recommendations
With the deep analysis of the external and internal environment of the company together with the market analysis and the rival analysis, Alternative 2 is recommended to CMP to accomplish its future development. As the choices are moving towards digital publishing and the company need an instant option to prevent the declining industry growth. Intro of digital publishing might prove to be an immediate option with low amount of risk for the business. The business might likewise consider the expansion program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its item portfolio, the business must initially gathers the data associated with the customer demand, the potential markets, the federal government policies and the information related to the competitors provided in the market. After that, the business must choose one prospective section for its preliminary offering. It must collect research study that how it could distinguish its digital publishing from the existing competitors' items. The steps above the business ought to go for the preliminary offering. If the initial offering shows a success, the company should opt for the other markets. In this method the business would have the ability to implement its digital publishing program.
Conclusion
The growth of the publishing market is decreasing since 2008, showing a hazard to the company's long term existence, however the situation can be managed by considering a development strategy in the future. The company might think about introducing digital publishingin its existing market to implement its advancement program at instant basis and to prevent the threat of failure for entryway in the new markets.
