Strategy Review Report
Every business organization, with the exception of few monopolies, operates in an external environment that is subject to competitive pressure. Market rivalry makes it imperative to seek out ways to either survive or thrive. Failure to meet these two objectives inevitably leads to business closure. Managers and business executives are thus required to formulate relevant strategies with the view of attaining sustainable competitive advantage. This advantage is crucial in both acquiring and retaining market share. Strategy formulation cuts across all levels of management. While senior leadership focuses on medium-to-long term strategies, lower levels of management focus on short term strategies. However, at the end of the day, it is necessary for short-term strategies to cohere with long-term strategies so that an organization’s vision can come to fruition. This report analyzes the competitive strategies employed by ‘3 Colors’ to navigate its market. Information on the firm was obtained from the operations manager via phone interview. Recommendations are provided thereafter.
3 Colors is a media and advertisement production firm based in Saudi Arabia. Located in a highly competitive Middle East market, the firm has achieved significant progress over the years. Its client portfolio has grown to include some of the top corporate players in the region. Further, its financial base has expanded considerably throughout this period. The company employs highly-skilled and creative individuals who are spread across three major departments; Design, Production, and Market Outreach. The design department focuses on developing concepts for both existing and prospective clients. Its brainstorming sessions have given rise to some of the most impactful advertisement campaigns in the region.
The production department translates concepts into tangible products such as billboards, brochures, branded items and documentary films just to mention a few. The market outreach department on the other hand executes all the marketing functions for the firm. These include sourcing for new clients, maintain customer relations with existing clients, conducting market trends analysis and needs assessment and benchmarking exercises to identify industry best practices. It also works closely with the design department to ensure new concepts match client tastes and preferences. This core team is backed up a support services team comprised of finance and human capital functions.
Strategic Analysis-strategy Review Report
As is the case with many other advertising agencies in the region, 3 Colors primarily employs a differentiation strategic approach. This approach entails devising strategies which make its products and services appear as unique as possible. Each client, irrespective of their size, receives a bespoke solution designed to fit as closely as possible with their requirements. For example, an Idd-Ul-Fitr promotional campaign for a large departmental store would significantly differ from one developed for a small family business. To achieve this uniqueness, representatives from the design and market outreach departments hold a series of meetings with the client. During this meeting, the client’s requirements are discussed at length and the general idea developed. Thereafter, the design team embarks on a rigorous process of formulating several applicable concepts. These concepts are then presented to the client for approval. Any required changes are discussed at this point.
It is worth noting that this bespoke approach to handling the client applies to all products and services; whether they are billboards or short documentary films. This highly personalized way of doing business has endeared 3 Colors to many clients who have in turn offered repeat business to the company. Another way in which the company differentiates itself from its competitors is by offering post-execution consultancy services to their clients as part of the package. Basically, clients can have a representative from 3 Colors join their marketing team for the duration of the marketing campaign. The representative serves as an advisor to the client’s marketing team on matters such as consumer perception metrics and adapting to shifting consumer tastes and preferences. While most other media and advertising publishing companies charge extra for this service, 3 Colors incorporates it as part of the initial package the client paid for.
3 Colors also offers prospective clients limited access to frequently updated market intelligence regarding consumer preferences in diverse markets. This feature is meant to show the prospective client the kind of useful insights relied upon by the design team to develop market-centric concepts. According to the company’s management, this tool has proven useful in winning over new clients since many other firms in the sector offer it as a paid-for-feature only. It has also served to reinforce the confidence existing clients have in the company. One distinctive feature of the market intelligence tool is that it employs both primary and secondary research from a wide variety of sources to come up with a comprehensive assessment of market conditions. This characteristic explains its attractiveness to potential clients.
Personal Assessment-strategy Review Report
The differentiation strategies employed by 3 Colors go a long way in creating competitive value propositions for its clients. Its customized approach to doing business is well-suited to the industry in which it operates. Moreover, the commitment of each department to the successful execution of these strategies is impressive. It is therefore unsurprising that the company has managed to continue charging a premium price for its products and services for a long time. However, in spite of this remarkable success, new developments in the advertising industry in the region suggest that the company’s competitive advantage may no longer be secured.
New entrants in the market have incorporated multiple differentiation strategies in their operations and their prospects look promising. Consequently, the competition for the existing client pool is likely to get intense in the coming months. With an increase in new entrants into the market, the clients’ bargaining power is likely to go up. An increase in the clients’ bargaining power is likely to result in reduced prices across the board. This development will see 3 Color’s margins shrink substantially over time. In the absence of a timely strategic intervention, the company may see its fortunes dwindle in the mid-to-long term horizon.
Recommendations-strategy Review Report
3 Colors should shift its strategic approach from differentiation to focused differentiation. The client pool served by the advertising industry in the region is highly diversified. The company can leverage its market experience to design strategies which focus on particular segments. For instance, the firm can choose to focus its efforts on developing creative campaigns for clients in the hospitality industry, thereby creating a niche for itself in this area. By focusing on a niche market, the company can in effect extend the learning curve to be covered by new entrants, thus minimizing competition, at least in the short-to-medium term.
The power of innovation in the modern business environment cannot be understated. 3 Colors should develop and deploy innovative technological solutions to complement their artistic prowess and market experience. For instance, by seeking IT consultants in the region, the company can develop Smartphone applications through which clients can monitor vital engagement metrics for their advertising campaigns in real time. Such a tool would enable the client to easily assess whether they are getting value for their money. In the long term, this move would increase 3 Color’s credibility in the market, thereby bringing in more clients and expanding its revenue base in the process.