Evaluation of Strategic Alternatives - Research Paper Example

? Evaluation of Strategic Alternatives s Introduction In the previous paper, it was established that Limited Brand Inc has several weakness that makes it less competitive in the market and therefore, it is unable get a wider market share and even record high sales as well as profitability. These areas of weaknesses that were established include the company’s poor brands, lack of efficient resources that can enable the company to strategically market itself and make capital investments to improve its beauty products and apparel. Thirdly, the company also has a weakness in terms of inadequate technology and the poor positioning of the company hinders it from competing competitively in the market. Therefore, this present paper will explore appropriate alternatives that Limited Brands Inc can explore in order to eradicate the weaknesses that have been identified and make the company competitive, thus increase its market share, sales, and profitability levels. While evaluating the strategic alternatives that the company can explore, the study will focus on marketing function of the company. Strategic alternatives Considering the weaknesses that have been noted that been noted which include poor brands, lack of efficient resources, inadequate technology, and poor positioning it can be deduced that the strategic alternatives that the company have comprise of rebranding. Rebranding will focus on its beauty products and apparels in order to come up with brands that are competitive within the market place; this is according Burtenshaw et al. (2006). The second strategic alternative is mobilization of funds from shareholders through options such as initial public offering, issuing of bonus shares to the current shareholders, merging with a strategic company or investor who can bring into the company more financial resources as well as strong management skills or borrow additional funds from financial institutions such as banks. The third strategic alternative is acquiring latest technology that can improve the operations within the company, lower operational cost, and improve the quality of customer service (Tench and Yeomans, 2006). It is of essence to state that acquiring latest technology largely depends on the availability of financial resources and therefore, this third strategic alternative is dependent upon the second strategic alternative. The fourth strategic alternative is repositioning Limited Brands Inc within the market so that prospective customers can have a new positive attitude towards the beauty products and apparels of the company; this is according to Smith and Taylor (2004). Under repositioning, the company will engage in aggressive marketing campaign in order to change consumers’ perception and attitude towards the company as a whole and that they may be able to associate the company with superior beauty products and apparels. Selected alternatives Considering that, the alternatives focus on different areas of operations in Limited Brands Inc it would be impossible to pursue all the strategic alternatives simultaneously because some dependent on the other. For example, the company cannot seek to acquire adequate technology without having adequate financial resources. Furthermore, the company cannot acquire additional resources if it still has poor brands and has a weak position within the market since it will be unable to convince any willing investor or financier that it will offer them good returns. Therefore, the only viable alternatives for Limited Brands Inc are to rebrand its beauty products and apparels, and repositioning itself within the market. According to the writings by Fill (2006), these alternatives will enable Limited Brands Inc to record more sales, generate more profits, and acquire more market share. By being able to record more sales and higher profits the company can be able to easily acquire more financial resources and advanced technologies. Collectively, these achievements will give the company a competitive advantage within the market place. Focus area In reference to the writings by Donaldson and O’Toole (2007), it is noted that because Limited Brands Inc will be pursuing the strategic alternatives of rebranding and repositioning, the focus area within the company will be its marketing function or department. The paper will focus on the marketing aspect because the tasks of rebranding products and repositioning the company fall under the jurisdiction of the docket. According to Belch and Belch (2011) both rebranding and repositioning subscribe to the cognitive psychology theory that focuses on individual internal states such as attention, thinking, motivation, decision-making, and problem solving, this is because the two aim at changing the mindset and attitudes of customers. Rebranding According to the writings by Muzellec and Lambkin (2006, p. 803-824), the term rebranding refers to, “the creation of a new look and feel for an established product in order to differentiate the product from rivals’ products.” In this regard, rebranding activities usually entail the changing of a product’s name, the logo of the product or packaging of the product. McFall (2004) further noted that rebranding is a marketing activity that entails creating new marketing campaigns that focus around the new buzzwords of the rebranded products. From these descriptions of the term, it is evident that rebranding involves the repositioning of Limited Brands Inc’s products within the market. Tench and Yeomans (2006) stated in their writings that the objective of rebranding is to change the perception of consumers regarding a particular service or product by re-energizing the brand and making the brand more appealing and relevant to needs and expectations of consumers. Levi (2007) further noted that the efforts of rebranding are directed also to the competitors and shareholders of the company to inform them of the differentiated identity of the service and product. It is critical to note that Limited Brands Inc is seeking to rebrand its beauty products and apparels because of low sales, which denotes that the customers within the market associate the products with negative perceptions that might include poor quality of the products and/ or high prices of the products. Rebranding efforts would therefore seek to change the negative perceptions that are associated with the company’s beauty products and apparels and the customers will then look at the rebranded beauty products and apparels with a new mindset that is likely to trigger sales. Falemara (2010) stated that while rebranding, it is critical for the company to ensure that it conducts the process in an ethical manner to avoid triggering lawsuits from different quarters that might feel violated by the new logo, brand name, or even the campaign message. For example, O'Shaugnessy and O'Shaughnessy (2003) stated that at times while rebranding, companies violate the patent or trademark rights of other companies and in a way try to associate the rebranded product or service with another unrelated company that is of high standing in the industry. Such ethical violation usually attracts a lawsuit from the company that feel violated by the rebranding. Repositioning According to the writings by Trout and Rivkin (1996), “re-positioning is defined as the process of changing the identity of a product, relative to the identity of competing products.” Limited Brand Inc is operating in a very competitive industry that is evolving periodically. Eze (2010) stated that the act of repositioning a company involve making decisions as to which direction the company will follow. Presently, Limited Brands Inc deals with only a limited range of beauty products and apparels for young women only and in a bid to reposition itself and play in the big league of other major fashion retails such Marks & Spencer, it will be essential for Limited Brands Inc to add a wide range of products into its retail stores. Secondly, after adding a wide range of beauty products and apparels into the retail chain, it will be essential for the company to change its present name store in order to reflect the wide range of beauty products and apparels that will be available. While repositioning the company has to ensure that it conducts the process in an ethical manner and acquire new range of products in a transparent manner without infringing the copyrights of other fashion designers and retailers. References Belch, G. and Belch, M. (2011). Advertising and Promotion: An Integrated Marketing Communications Perspective. (9th edition). New York: McGraw-Hill/Irwin Burtenshaw K., Mashon N., and Barfoot C., (2006). The Fundamentals of Creative Advertising; Lausanne: AVA Publishing Donaldson, B., and O’Toole, T., (2007). Strategic Market relationship: from strategy to implementation. London: John Wiley Eze, P. (2010). DRAMA FREE REBRANDING. Global Mark Makers Falemara, F. (2010). Re-Branding the Nation. Xlibris Publishers Fill C., (2006). Marketing communications: engagement, strategies, and practice. London: FT Prentice Hall Levi, K. (2007) "Differentiate or Diminish: The Art and Necessity of Business Positioning" McFall, L., (2004). Advertising: A Cultural Economy. Thousand Oaks, CA: Sage Publications Inc., Muzellec, L. and Lambkin, M. (2006). Corporate Rebranding: the art of destroying, transferring and recreating brand equity?. European Journal of Marketing, 40, 7/8. Pp 803-824 O'Shaugnessy, J. and O'Shaughnessy, N. (2003). Persuasion in Advertising. London: Routledge Smith P., and Taylor J., (2004). Marketing Communications: an integrated approach. London: Kogan Page Tench R., and Yeomans L., (2006). Exploring Public Relations: London: FT Prentice Hall Trout, J. and Rivkin, S. (1996). The New Positioning : The latest on the worlds #1 business strategy, New York: McGraw Hill, Read More