Meredith Corporation Profile and SWOT - Term Paper Example

SWOT Analysis for Meredith Corporation Company Profile Meredith Corporation is one of the most renowned US based media companies. The corporation came into being during 1902, when it used to publish a magazine called ‘Successful Farming’ hosted by the company’s founder Mr. Edwin Thomas Meredith. Since then the company enjoyed a growth both in its sales as well as production. By 1912 the company had more than 500 subscribers and 200 employees. In 1922, the company introduced two more magazines in the market, namely the ‘Dairy Farmer’ and the ‘Fruit, Garden and Home’. The company first took the initiative in diversifying its activities in the post-war years. By 1965, the company had already acquired three Television Stations and owned a profit-making printing business and also registered itself in the New York Stock Exchange. However, Meredith was a publicly owned company from its very beginning. The company used to seek for investors very vigilantly and later in 1985, with due consideration to its growth strategy implementation made itself a Fortune 500 Company. Like many other companies, Meredith Corporation also went for mergers and acquisitions all over USA. Instead in early ‘90s the company, as a result of advertising crash and increasing competency in the market, witnessed a huge loss and had to sell almost half of its interest. Taking lessons from this fall Meredith again went back to the magazine sector in 1994 developing a modified marketing planning, offering its subscribers more domestic topics related to home and family. At present its principal distribution is in the sectors of Broadcasting and Publishing with operating units in parenting and women’s lifestyle group (Advameg Inc, “Meredith Corporation”). Meredith Corporation at Present Running for over 100 years, Meredith Corporation at present owns 20 brands including the Better Homes, Home Journal, Parents and the very popular Successful Farming; as well as acquires a number of local media brands, like Atlanta, Fox, Working 4 You, PDX and many more. It has also extended its market sphere beyond the national horizons in the international markets of Russia, India, China, Turkey, Brazil, Italy, Australia, and Canada. To state about its sustainability, it is recorded to be the most successful marketing communication companies, well known for its customer friendly content that easily becomes a part of the life of every subscribers; rewarding the company with a huge customer base of around 17 million only in America (Meredith, “Environmental Sustainability”). Figure 1 (Meredith, “Organizational Chart”). Certainly, the company’s history and present status takes a vital and prominent role in selecting the company’s strategy. For the same reason it becomes fairly essential to understand the requirements and optimal goal of the company. But before that a proper analysis of the company’s internal and external condition must be undertaken to conclude about its strategies. Internal Analysis The objective of internal analysis is to understand the strengths and weaknesses that rest within the company’s internal boundaries. As such the strengths and weaknesses of Meredith Corporation are discussed below: Strengths Meredith Corporation has a target market basically comprising of women from all spheres of life, which provides it with a huge market base of more than 85 million all around the globe. The company keeping its targeted customers’ demand in mind has also designed an appropriate database compelling with the issues related to home-decoration, child-care, fitness, investment, and even technology-use and updates covering all the aspects of household problems and solutions. Mentioning, the inclusion of 360 ° approach in marketing has also provided it a healthy competitive edge. Therefore, it implements a strategy of integrated marketing. Again to include about its sales strategy, it takes part in online media owning 50 websites, 14 national media brands and almost 12 local media brands that allows it to reach a wide range of customers in its targeted market. Moreover, it has its partnership with many famous brands in the American market, such as O’Grady Meyers and Genex, which provides strength in obtaining useful resources at a cost effective manner. The corporation also has its hands over brand licensing (Meredith, “Fact Sheet 0809”). The production techniques that are used in this company keeping in mind the government rules and regulations along with corporate social responsibility are also cost effective and environment friendly. This takes the company one more step forward to maintain its strength in the market (Meredith, “Sustainability Report 2010”). Regarding its financial outlook, the corporation’s annual report also calculated an increase in the EPS of the company by 10% in the current fiscal. Additionally, counting its revenue at a figure of $1.39 billion that increased by 1% from 2009 certainly enhances the financial strength of the company. To put into account the efficient management activities played a key role in increasing cash flows, minimizing debts and operating costs, and remarkably increasing the dividend for the 17th following year (Moines, “Meredith Reports Strong Fiscal 2010 Fourth Quarter & Full Year Results”). Figure 2 (Corporate Information, “Meredith Corporation”). Precisely, its diversification strategy and 360° marketing strategy, acquisition of elements in distribution channel, reduction of production cost and effective management system are certain major strengths that the company possesses. Weaknesses The company as such might seem to have minimum drawbacks or weaknesses in its mechanism, but the strategies undertaken practically are of certain limitations and thus can result in organizational weaknesses. As the company’s advertisements and sales are highly dependable on integrated marketing based on technology and designed by considering the globalization factors, any changes or fluctuations occurred in the technological environment can highly influence the company. The other weakness of the company is its customer group and is targeted to a single dimension of socio-economic environment, i.e. concentrated on women. This as a result restricts the company’s activities to a level. With the capability and scope to enlarge its functioning dimensions, the company can certainly go for a horizontal diversification to minimize these weaknesses. To sum up, most of the company’s revenue, up to almost 56% of its revenue was basically generated from its advertising sector, which raises the risk that a downturn in US economy shall result hazardously to the company’s earnings. Along with advertisement, the revenues include earnings from circulation which again comprises the risk of new alternatives in the sphere. The major participation of internal shareholders with voting rights can accordingly diminish its market value on the contrary. Therefore, the company’s facts and figures may seem to be sparkling but the underlying risks are also of pointed consideration (Meredith, “2010 Annual Report”). External Analysis Apart from the internal analysis, the external analysis also has its noteworthy importance to evaluate the company’s opportunities and threats present in the market. Especially, for an international company the threats and the opportunities, related to globalization, competitors and other external factors can create an immense pressure. These factors not only work in the international market but also in its national vicinity. Opportunities Today globalization indicates both fear and opportunities in the mind of global marketers. Even for Meredith Corporation it is not in exclusion. The matter therefore has its own influence on the marketing strategies and other functions of the company. To be mentioned in this context, the company has a great opportunity lying in its external environment with a growing demand of social media. Moreover, the company’s market coverage shall also provide it with a better opportunity in negotiating the power with buyers and suppliers in the national and international market. Stating the fact that most of the media and entertainment companies witnessed a fall back in recent down turn of the market incurring high volume of losses but, after the darkness of recession and the end of downturn, the market for media and entertainment companies can expect a stable growth and increase in demand for their products subject to the stability of global economic conditions (Booz & Co., “2010 Media Industry Perspective”). Threats Even for a successful company like Meredith Corporation, there are numerous factors that evoke to be the company’s threat in the external environment. To put into account, the company’s activities comprise of majority of printing and publication costs which again depend on the paper and postage industry. Thereof, any kind of variation in the paper and postage prices shall have an influence on the company’s revenue as well. The company for its activities is compelled to abide by the rules of the FCC regulation, and any further inclusion or extension of the act can result in mandatory changes in the company’s operations. Other than government rules and regulations, the company also needs to follow the agreement affiliation with different media players such as, FOX, and NBC which certainly limits the company activities (Meredith, “2010 Annual Report”). Apart from all these variants, another feature that stands as a threat to the company is its competitors since the media industry belongs to the list of most competitive industries in the world. The most challenging competitors of Meredith Company till date are the Martha Stewart Living Omnime, Advance Publications, Inc. and The Hearst Corporation. All these companies possess almost a similar kind of product lining and marketing strategies with regard to Meredith Corporation. Moreover, with so many opportunities in the global market it is likely to give rise to the threats of new entrants in the market. Therefore, the company at this stage needs to build up a competency level in order to face the highly competitive market (Moines, “Meredith Corporation”). Conclusion From the analysis of company’s internal and external strengths, weaknesses, opportunities and threats, it can be better stated that the company has a strong internal build up but has to face the ever changing challenges in the external environment where the factors are uncontrollable and impulsive. For instance, the majority of the advertisement earnings in the total revenue income of the company can prove to be risky if a new alternative is introduced in the market. Similarly, the entrance of new competitors and any other change in the external environment is unmanageable and almost unpredictable to overcome. The company here has to reduce its weaknesses and enhance strengths in order to lessen its threats and use its opportunities in the market. A few of its weak points such as distribution of company shares and revenue generation techniques should be reformed in a manner with the intention that the risk factor gets reduced. Due to innovation an introduction of new thoughts play a vital role. To provide the customer’s ultimate satisfaction it becomes very necessary to conduct regular training and development sessions for its employees. Conclusively, the company needs to revaluate and analyze its strategic structure to curtail the internal weaknesses and external threats in future. References Advameg. Inc. “Meredith Corporation” November 16, 2010. Encyclopedia of Business, 2nd ed, 2010. Booz & Co. “2010 Media Industry Perspective” November 17, 2010. Media, No Date. Corporate Information, “Meredith Corporation” November 17, 2010. The Winthrop Corporation, 2010 Meredith. “Environmental Sustainability” November 16, 2010. Meredith Corporate, 2010. Meredith. “Organizational Chart” November 17, 2010. Meredith Corporate, 2010. Meredith. “Fact Sheet 0809” November 17, 2010. Meredith Corporate, 2010 Meredith. “Sustainability Report 2010” November 17, 2010. Meredith Corporate, 2010 Meredith. “2010 Annual Report” November 17, 2010. Meredith Corporate, 2010 Moines, Des. “Meredith Reports Strong Fiscal 2010 Fourth Quarter & Full Year Results” November 17, 2010. Press Release, 2010 Moines, Des. “Meredith Corporation” November 17, 2010. Hoovers Inc, 2010. Bibliography Nijssen. Edwin Jacob & Frambach, Rudd T. Creating Customer Value Through Strategic Marketing Planning: A Management Approach Springer, 2000. Read More