Emerging Business Themes - Essay Example

Emerging Business Themes Social Change impacts The Chief Drivers for Social Changes Social change is a multifaceted and complicated phenomenon. Two main factors affect social change. They include demographic and technological factors (Smith & Taylor, 2004 .p. 447). Demographic factors concerns changes in factors like migration, birth rate, immigration or death rate, which can cause alterations in age and sex ratios as well as other crucial populace parameters. Changes like these have an effect on family relations, marriage norms, and regulations of the marginalized eventually affecting social change. Technological factors concern the technological improvement that has led to the production of excess food, industrialization, population growth, and urbanization. The factors have influenced work-related divisions, sex roles, rivalry interdependency, as well as family size. Improvements in the areas of communication and shipping decreased the communal distance that gave drive to artistic diffusion and thus to social change. Impacts of Social Changes on the Products and Services Demographic issues have always been of significance to marketers. In the previous one decade, there has been a fast development of technologies in goods and service manufacturing, distribution, design, and individual use, which have contributed to changes in customer behavior. For instance, communication advancements such as the accessibility of wireless communications, personal computers and internet, have altered shopping and consumption manners. In the United States vehicle industry, clients in need of a vehicle search carefully in the Internet before they visit a dealer. Marketing investigators have extensively used population data. Parameters like sex, income, age, and social class are sensibly nice predictors of consumer behavior as well as market associated activities in macro and micro perspective. The globe population is rising at a rate of over ninety million per annum. The aging of the populace could be the truth that the proportion and number of younger persons is dropping fast. For instance, Italy’s population would change from eighty million to forty million (Smith & Taylor, 2004.p.243). The basic features of developing and developed nations will begin to differ in significant ways. Senior communities could have undoubtedly different wants and standards from the younger ones. Hence, while communication and globalization advancements are driving the globe towards union, demographic issues are going in the opposite way, and could cause basic split between the senior and younger countries, and wealthier and poorer clients. The persons with the uppermost earnings, leading savings and nearly all costly stock portfolios are of age fifty and eighty. The three chief concerns of the senior clients are healthiness preservation, security or safety, as well as wealth preservation. The longing for fitness preservation broadens to health awareness in all ways. Beverage and food manufacturers will have to come up with better products. Technology Development Technological advancement has been very fast during the last two decades. The cost of many technologies has decreased and the capabilities will continue to expand. Several technologies, have began to have an important effect on the society The up-coming technologies in marketing, distribution, production, and individual use facilitate the alteration in customer behavior because of demographic trends. With the continuously advancing technology, the clients seek means that enable them to obtain goods and services, which need less effort and time. Clients are more individualistic, demanding, time-driven, and knowledgeable. A mixture of an omnipresent broadband computerized communications system as well as high designation present terminals are further facilitating changes in customer behavior. With interactive computerized media, advertisers are able to spread their messages, and enable user communication and participation. The manner of shopping has also changed. Clients have direct access to many self-determining retail services, causing distributed proficiency on demand. Because of active advertising, clients are much more dynamic in seeking seller-generated information. The majority of the marketers do not clearly address the older market, demoting it to a niche instead of handling it as the rising mainstream. Consequently, clients over fifty years are using less money and time on customary shopping. Alternatively, they are using their money in businesses that are particularly providing optimal services to them, like recreation, travel, gardening and fitness. Several have little knowhow of how customers have changed over their lifetime in terms of the standards and attitudes. The opposite is also true as some vendors have not been able to get out of the old market. For instance, the average age of clients of Detroit manufactured vehicles is the middle fifties to early sixties. Consequently, the Detroit vendors are at a big risk of closing out of the young market. Examples of an Organization Greatly Affected by Social changes The Coca cola Company The internet and television technology advancement influences companies’ promotion, and marketing. The media promote product pleasantly, and it helps to raise product sales. The launching of plastic cans and bottles have heightened the sale of coca cola, since it is simple to utilize and dispose them. The improvement in technology caused the company to create new products. Many more people are leading better lifestyles. Such changes in population growth, lifestyle, as well as change in attitudes influence the non-alcoholic business such that many persons like to have colas and water rather than beer. They are after healthy goods, juice and bottled water, products considered vital in the everyday life. Clients from the age of thirty- five to sixty are more worried about nutrition. The elder people are more concerned with enhancing their life and positively impacting their life expectancy. This type of social trend could influence the demand of the non-alcoholic drink industry. A rise in alertness amid buyers, and current life style may be a problem to the Coca Cola Company. Nevertheless, the company acknowledged the clients’ wants and started to make nutrition coke, sport drinks, bottled water and juices. A change to nutritional drinks resulted from increased awareness by nutritionists who cited that drinking of Coca Cola could be dangerous to people’s health particularly to young kids. Daily consumption of the Coca Cola drink could have adverse effects on fitness after years of use. Change in non-alcoholic beverages business environment: In 2007, the Coca Cola Company improved their product because people were more careful about fitness and health. The company improved the organizational arrangement to satisfy the demand of the clients by amalgamating with North American bottle, juice and can, company. The Coca Cola Company should consider demographic factors. Customs, beliefs and personalities of customers in new nations could be different, which gives the company information to change some plans. Certain factors such as cultural changes, demographics, technological changes as well as climate are bound to influence Coca-Cola Company both in the short and long term. Globalization impacts Globalization in Business Context Globalization refers to the process of interaction and incorporation among companies, persons and regimes of various countries, caused by global investment and trade, and facilitated by information technology. Such a process has key effect on the political systems, environment, economic development, culture, prosperity, and on human health and societies all over the world. Its impacts affect persons, as trade tend to move past their local and global markets to other trades all over the world, where various markets are interrelated. The World Bank describes globalization as the international circulation of products, services and investment, and also of ideas, people and information. It has informed change in the twentieth century, even though with big cyclical differences and has become an observable force in current decades (Needle, 2010.p.13) The Coca Cola Company and Globalization The Coca-Cola Company benefits from large economies of scale by entering into global markets. Such bottling in the end makes the corporation more competitive by advancing their production ways in order to get the least cost probable. Furthermore, they explore potential global markets for expansion and venture chances. After the company fulfills the domestic market wants, it would desire to become involved in new markets to increase its revenues and profits. It would also raise the company’s client base, as there is a fresh supply of order. Competition The Coca-Cola Company rivals in the non-alcoholic drinks sector of the saleable beverages industry. The drink industry is extremely competitive, because there are various different kinds of drinks in the marketplace varying from alcoholic to non-alcoholic drinks. Several corporations are similar to the Coca-Cola Company. Some of the companies tend to compete for a share of business across the globe. The businesses are mainly globalised due to the fact that they seek to get to fresh and greater markets as the company has already met local market needs. The tough rivalry from the Pepsi-Cola Company would be another cause, because they are the Coca Cola Company’s chief competitors. Numerous competitive issues could affect the company, which include advertising, pricing, product improvement, sales promotion plans among others. Positive Impacts of Globalization on the company Competition to better quality Globalization has caused increased rivalry for the non-alcoholic drink market for the Coca Cola Company. Therefore, there is a general tendency to advance the quality of their drinks for them to retain and advance their market share. To stay in operation, the company should be able to handle the high standards demanded by their clients. The Coca Cola Company must be able to rival at low costs and constantly advance their bottling methods. Keen rivalry forces businesses to speed up their product advancement and promotion fights, factors that signify a company’s power in the marketplace. Innovation The economic setting is changing fast because of globalization. The rate at which products are developed has heightened mainly due to factors synonymous with globalization. Gains to the world are regularly distributable among people for the better good. For instance, the bottling firms built by the Coca-Cola Company employ superior mechanics, and other industrial technology such as use of superior computerized robotics which establishes countries to a more efficient and competent way of bottling that could then be advanced further to fit domestic needs (Hoskisson, 2008.p.176). If the company is able to continuously advance its invention line across the globe, it would be able to reinforce its global position. Furthermore, by the fact that the company is able to operate at a larger scale, it is able to access multiple resources which inform product development and new ways of doing business which constitutes innovativeness. Popularity and Identification The Coca Cola Company was able to emerge into nations worldwide because of advertising programs, and mass increasing which ultimately made their product name one of the most well recognized brands at present. Several companies have ever since followed by extending into global operation while maintaining focus on product recognition. Marketing campaigns are the strong powers of the Coca-Cola Company since it can get the loyalty of clients through easily recognizable advertisements. Work opportunities The company’s worldwide expansion has led to job creation in at least two hundred and thirty nations globally which would absolutely make and improve the economic growth of one’s nation. The Coca-Cola Corporation has more than one hundred thousand workers worldwide. Globalization is as an opportunity for the Coca cola Company as it would be able to use a broad background of workers from all over the world not only to improve the company’s plight but contribute to local economies. Cultural impact Cultures all over the globe have come together and formed so many societies in various cities around the world, which have developed and enhanced globalization. People discard some aged customs as they form fresh ones every day. The Coca-Cola Company has introduced its products in various nations all over the world and has changed the manner in which people have their food. People from various diverse cultures feel as if they share a similar culture, which is the Coca Cola. The Coca-Cola Company has more than two hundred products in its portfolio. Hence, there are other countless emerging fresh products for the company to go after. This would guarantee the company’s continued existence well into the future if a product succession strategy is in place. An unfamiliar product does not imply that it is a malfunction, just not yet identified in the market. As soon as consumers identify it, it starts the product cycle and hence helps safeguard the company’s future. A major company tactic in this regard would be to continue innovating and increasing its product portfolio with products that are likely to do well in the near future. Negative effects of Globalization Lack of recognition in other portfolio products The other products presented besides the chief Coca-Cola products do not have popularity. They are typically unidentified or hardly ever seen on markets probably due to controlled distribution in a certain nation as testing approval of the market. Such products are of a small profile and no connected link is to the chief product if the product fails. Changing fitness and health awareness Even though it is profitable for the corporation where higher utilization leads to higher returns, taking too much will have negative health impacts on clients. The health awareness of people is beginning to change, as they are moving towards healthier lifestyles. One way through this shift is enabled is by averting soda drinks which is a risk to the company existence. Work insecurity There is a big danger of retrenchment for workers in the developed nations as their equivalent workers in the developing countries could replace them in search of lower expenditure. Consequently, a danger exists where the company may lose its best workers to rivals if it proves the least signs of reformation. Recommendations The Coca Cola Company should increase their advertisements for the products that are not well recognized. The company should advertise the unpopular products alongside the popular products because it is advertisings are pleasant and popular. The company should look for the strong products the competitors have and innovate around them to develop brands that will act as an alternative. 3. Decision making model Game Theory Game theory evaluates tactical interactions in which the result of one's selections depends on the selection of others (Washick, Fisher & Prentice, 2010.p.67). In order for the condition to be measured a game, there ought to be not less than two coherent players who take into consideration one another's deeds when developing their own tactics. If one of the players does not take into account the measures of the other player, then the dilemma becomes one of normal decision evaluation, and one could execute a strategy that is not the best. For instance, a firm that decreases prices to raise sales and thus increase profit could lose if other key players react with price decrease. In addition, thinking about a risk avoiding company that makes its choices by making the most of its smallest amount payoff without taking into account the responses of its competitors, is another example. In such a situation, the smallest amount payoff may be one that would not have happened because the rival might not at all find it fine to execute a tactic that would make it happen. In almost all situations, it is vital to take into account the actions of one's rivals. Game theory presumes that one has rivals who are amending their tactics according to what they consider everyone else is doing. The precise level of complexity of the rivals should be part of one's tactic. If the rival makes her or his decisions aimlessly, then one's tactic might be very dissimilar than it would be if the rival is taking into account others measures. To evaluate such a game, an individual puts himself or herself in the other player's position, knowing that the rival, being smart, is taking the same step. Once this thought of the other player's actions goes on forever, the effect is an endless reverts. Game theory gives the mechanism to evaluate such issues. Game theory can evaluate a broad range of tactical interaction surroundings including politics, oligopolies, and sports. Several product malfunctions are due to the failure to take into account adequately the reactions of rivals. Game theory influences one to take into account the variety of a competitor's responses. The elements of game theory The game theory is composed of four constituents (Washick, Fisher & Prentice, 2010.p.67). The Players: any choice-maker in the competition is a player. One can use this name to refer to a nation state, person, or firm. Furthermore, any player has the capability of selecting one choice among many possible measures. Strategies: any plan open to a competitor is a strategy. Nevertheless, if the tactic proves to be superior to all the other tactics in spite of the measures of the other rivals, it is the dominant strategy (Washick, Fisher & Prentice, 2010.p.67). On the other hand, if the tactic is inferior to the others, in spite of the measures of the other competitors, it is the dominated strategy (Washick, Fisher & Prentice, 2010.p.67). Payoffs: it is the result or outcome of every tactic at the ending of the play. One can calculate Payoffs in terms of usefulness to the company, or in financial terms, which involve benefits and costs. Finally, experts presume that participants are able to grade the payoffs to come up with the best choice. Information: This regards whether the participants have ideal awareness of happenings each time a choice needs to be done. Advantages of the Game Theory Game theory provides insight into a number of less-recognized aspects that come up in circumstances of contradictory interests. For instance, it depicts and explicates the occurrence of negotiation and unity-formation. Game theory builds up a framework for evaluating choice making in such circumstances where co-dependence of companies is measured. Game theory summarizes a systematic quantitative method that players can use to get to the most favorable strategy. Limitations of the Game Theory The supposition that players have the information about their individual pay-offs as well as pay-offs of their rivals not realistic. The methods of resolving games concerning diverse strategies mainly in case of big pay-off setting are very intricate. Game theory cannot evaluate all rivalry Example Coca Cola Company and the Pepsi clearly demonstrate the Game theory in the imperfect markets. Coca-Cola produced a coke that had a vanilla taste (Fantuzzi, 2008.p.12). The product’s sales increased greatly due to the new taste. The Pepsi Company denied that they would ever produce a vanilla product. Afterwards, Pepsi imitated the Coca cola Company and introduced a vanilla brand across the nations. Coca Cola’s sales were continuing to raise causing Pepsi to change its mind. The Coca Cola Company responded that Pepsi’s decision surprised them, since they imitated them and they had sworn not to make any vanilla product. Bibliography Andersen, M. L., & Taylor, H. F. (2007). Sociology: the essentials. Mason, OH, Thomson Wadsworth. Fantuzzi, K. (2008). Carbonated soft drink consumption: Implications for obesity policy.Newyork: ProQuest. Hoskisson, R. (2008). Competing for advantage. Mason, OH, Thomson/South-Western. Needle, D. (2010). Business in context: an introduction to business and its environment. Andover, South-Western Cengage Learning. Smith, P. R., & Taylor, J. (2004). Marketing communications: an integrated approach. London, K. Page. Washick,R., Fisher,T., & Prentice,D. (2010. Managerial economics, second Edition: s strategic approach. Newyork: Routledge. Read More