Auer Waffeln as an Example of Growth, Globalization, and Decline - Essay Example

?Auer waffeln an Austrian company's tale of growth, globalization and decline Introduction Marketing is a business management activity aimed at improving the business presence among a possible market segment. Marketing therefore entails the determination of new markets for the organizational products or services while marinating and improving is current market share. Business organizations exists objectively to sustain their profitability thereby their longevity. In doing this, they rely on the availability of the market and its ability to sustain the business operation. This fact therefore markets marketing an essential part of management since it consists of activities that safeguard the profitability of the organization. Business organizations rely on the effectiveness of their marketing strategies, which should always determine the potential of the market thereby informing the subsequent production process of the organization. An effective marketing process should inform the production thereby preventing the organization from incurring losses (Solomon et al, 2009). SWOT analysis The marketing process relies on a number of organizational analyses key among which is the SWOT analysis. This is a business tool used in analyzing the potential of the business organization in sustaining the market demands. The first two components of the analysis are the Strengths and weaknesses of the business organization while the last two are opportunities and threats of the business. The first two elements are therefore within the organization and the organization can manipulate them to ensure it sustains its profitability. The last two on the other hand exist externally; they are part of the market forces implying that the business organization cannon manipulate them. They therefore determine the profitability of the business. Since the business cannot manipulate the last two, they can always manipulate their internal structures to ensure effective operations in accordance with the changing trends in the last two elements thereby sustaining the profitability of the organization (Homburg, Sabine & Harley, 2009). Began as a small family business, Auer Waffeln grew to become an international success and the world leading manufacturer of some of the most common foodstuff. The growth if the business portrays a number of management success resulting from bold management strategies. However, the business later stifled away following a number of management lapses and the inability to maintain its market share. The success of the business depends on the effectiveness of the business idea and the nature of the execution of the idea. Guenter Auer identified a potential need for the foodstuff in the Austrian market. The business later flourished following the effectiveness of the business idea. Apparently, the Austrian market had lacked such a business thereby creating a loud that the Waffeln business seamlessly filled. Market entry strategies After identifying an effective business idea, the nature of executing the idea becomes essential in safeguarding the success of the business. Auer identified a gap within the market and therefore decided to fill it thereby developing a market of its own. The idea was unique and therefore took the market by surprise. The business therefore developed a sizable market for itself. However, Auer knew the nature of the market and the amount of potential it had. He therefore began by operating his business in a small scale within the small local market. This did not only provide adequate profitability but also provided the organization with an effective market research opportunity (Ghauri & Cateora, 2010). Through the small local market, he determined that the business could grow to become a national and progressively an international business. He therefore realized the need for a more qualified manager for the business a factor which compelled him to send his son to some of the best schools from where he studied manage net among other operational courses related to production. Guenter employed effective market entry strategies that resulted in the early success for the company. Market entry level of marketing is most important since it is at this stage that an entrepreneur determine the market group. The process includes identifying the market gap after which one designs an appropriate product which which to fill it. Guenter does this through his knowledge and professional experience as a chef. The market group he initially targeted had the conventional bakeries most of which produced bread. He therefore introduces a product that is unique to the market through a strange mechanism thereby taking a scoop of the market from previous bakers. While previous bakers relied on the production of bead alone which the sold to their customers in smaller scales, Guenter introduces wafers, product that is more of a snack than a bread produced by other barkers. By introducing a new product, he ensured that he had the attention of a barren market, which he would therefore manipulate to improve his profitability. He begins a systematic manipulation of the market through diversification of its production. He begins by looking for the contacts of any other possible competitor in the market. At the time the only competitors were the bakers most of who did not offer an intensive competition due to their different production techniques. He therefore enjoys an initial autonomy in the market, one that he seeks to hold on to for long. Through diversification, he expands his market base by introducing products that targeted different customer groups (Pickton & Broderick, 2005). This assured him of success since he does this after monitoring some of his early products perform. By introducing new products therefore, he possibly expands his target market possibly increasing his profitability levels. The divers product assure him of success since through each brand he could carry out an effective market research and identify the changing trends in the market group. Furthermore, he could cover up the poor performance of one brand by the success of the other. Stage theory/ business metamorphosis Through his son, Guenter rested assured that the family business did not only stay within the family but also with the best manager who was capable of steering the organization into success by identifying newer markets for the business. Guenter takes his son through the modern business collages where he studies both management and engineering. The two professions were essential in the management of the family business since through business management, he became capable of making basic decisions that steered the company into success and through his knowledge in engineering; he determined some of the best and cost effective means of production. This way, he maximized profitability thereby expanding the company. As stated earlier, marketing involves the determination of new markets and the retention of the previous markets. After having a bigger share of the local market, Rudolf realized that the international community was still unexhausted. Despite the success of the Auer Waffeln in Austria, other countries in the international community had not thought of the same. He therefore expands the company by trying to find market for his products in foreign countries such as in the Middle East and in the United States of America. The company follows the stage theory of development as it begins through a smaller production technique and later expands into the international market, a skeptic mode of marketing through which the expansion into other markets relies on the success of the initial market. Unlike his father, Rudolf introduces new techniques of doing marketing. Instead of dealing with the actual consumers, he concentrated on the wholesale business thereby allowing the retailers to manage the actual consumers. It is easier to handle wholesale customers since they buy in bulk. Furthermore, one does not incur many of the marketing expenses since the retailers market their own outlets. Additionally, he changes the conventional means of production introducing a capitalist means of production. By introducing machines, he replaces the humans but improves the quality of the products. This way, he maximizes profitability while enjoying an increased market a strategy that triples the profitability of the business. His introduction of the business is systematic as he begins with the importation of the products from Austria before setting up a company in the new country only after substantiating the success of the products in the new market (Ghauri & Cateora, 2010). The failure of the company later in the ages is a result of the changing means of doing business. Apparently, the market was changing which compelled the company to change its production techniques. It failed to compete effectively by lacking knowledge of the new market, a result of sticking to the old conventional means of marketing. While Guenter had taught his son thereby making him a better manager, his son did not find a capable replacement for him thereby flopping the production. References Ghauri, P & Cateora, P. (2010). International marketing, Third Edition. New York: McGraw Hill. Homburg, C. Sabine, K. & Harley, K. (2009). Marketing Management - A Contemporary Perspective (1st edition). John Wiley & Sons. New Jersey, U.S. Pickton, D. & Broderick, A. (2005). Integrated Marketing Communications. (2nd Edition). London: FT Pearson. Solomon, et al. (2009). Marketing – real people, real decisions, First European Edition. New York:FT/Prentice Hall. Read More