EADS Business Analysis using the Marketing Process Model, by Robert J - Term Paper Example

Case Study – EADS Business Analysis using the Marketing Process Model, by Robert J. Dolan Table of Contents 1. Introduction 3 2. Major Customers around the World 4 3. Main Products Offered 5 4. Marketing Process Model of Robert J. Dolan. 7 4. Marketing Situation Analysis – 5 C Analysis 9 4.1. Customers 9 4.2. Company Mission, Strength and Weakness 9 4.3. Competitor 11 4.4. Climate or Context (External Environment) 12 4.5 Collaborators 14 5. STP - Market Segmentation, Targeting and Positioning 15 5.1. Segmentation 15 5.2. Targeting 15 5.3. Positioning 16 6. Marketing Mix: 4 Ps Marketing 17 6.1. Product 17 6.2. Price 17 6.3. Place 18 6.4. Promotion 18 7. Marketing Strategies to Increase Profit 18 7.1. Profit Maximisation Strategies 18 7.2. Financial Key Figures on Accounting Profit 20 Key Figures 20 Present Structure 2008 to 2011 (Revenues per Division) 21 8. Conclusion 22 References 23 Appendix (Bibliography Sites) 28 1. Introduction The European Aeronautic Defence Space Company N.V. (EADS) is regarded as one of the major and large aerospace and defence corporations of the world. The organisation is well-known as a defence and military contractor involving manufacturing of aircrafts in various nations across the globe. The aircraft manufacturing organisation was founded in the year 2000 through a merger between Aerospatiale, DaimlerChrysler AG and Construction Aeronauticas SA (CASA) the two major and leading aerospace corporations (EADS, 2000). According to the present performance of EADS, it can be observed that the organisation executes effective business strategies which enable it to play the role of a dominant marketer in the global aerospace industry. Based on the global business performances of EADS, the report intends to analyse the business processes and the marketing strategies of EADS in the global aircraft manufacturing industry. With due consideration to the successful marketing strategies as well as business processes of EADS, the aim of this paper is to also analyse different marketing tools from the perspective of EADS in the global aircraft manufacturing industry. The discussion of this paper will further encompass an assessment of EADS in the global aircraft manufacturing as well as aerospace commercial service industry with regard to various competitive marketing tools such as Marketing Situation Analysis, STP model as well as marketing mix. 2. Major Customers around the World In relation to the business performance of the organisation, it can be witnessed that the European roots of EADS is quite stronger. However, the aerospace and defence industry based operations of EADS is one of the major considerations for the organisation which entails a range of products and services both for the European and the global markets as well. In the context of the organisations overall business practices, 75% of total products and services are exported in more than 100 nations through its 33 international offices (EADS, n.d.). The inclusion of Airbus within its business is one of the major beneficial factors for EADS in its global aircraft manufacturing process. EADS is further recognised as the major European industrial flagship which combines the major capabilities of four main market leaders of the global aircraft industry such as Airbus, Cassidian, Astrium as well as Eurocopter [1] (EADS, 2013). From the perspective of identifying the major customer base, it can be stated that the governments as well as the private sectors across the globe which incorporate aircraft facilities for military as well as commercial purposes are its key customers. The government of the UK is one of the major customer segments for EADS in terms of acquiring aircraft services in the nation for different purposes including both in the military as well as in the commercial service sectors. Moreover, it has been also observed that the overseas countries such as North America, Australia, India, Russia, China, Brazil as well as Middle East Countries, apart from the UK are also the major markets for EADS to deliver its range of innovative commercial as well as military aircrafts [2] (EADS, 2013). 3. Main Products Offered With respect to the organisation’s offerings, the product line of EADS includes four different segments which are as follows: Airbus SAS Airbus SAS is one of the major subsidiary companies of EADS which offers several kinds of jet-liner products, including military communication aircrafts, commercial airline aircrafts and transport aircrafts. Apart from these, the company also provides multi-role military air-lifters for various observation purposes, medical evacuations, marine patrols, carrying paratroopers and cargo transports. Moreover, the company manufactures, develops and supports commercial aircrafts of over 100 seats. The aircraft manufacturer possesses a range of superior products such as A320 Family, A330 Family and A340 which are a few of the best-selling aircrafts that the organisation delivers to a large number of countries across the globe. Moreover, the company also offers advanced and high-tech facility based aircrafts such as A350 XWB and A380 that facilitate it to uphold its outstanding performance shaping the future of air travel service [3] (EADS, 2013). Cassidian The aircraft manufacturing company significantly incorporates revolutionary designs in their provided aircrafts which enables to enhance security of the aircrafts along with facilitating to maintain lead system integration as well as value-added products in order to aid global civil and military customers. The lead system integration mechanism can be considered as a major part for the customers involved in coastal surveillance and border control process. The products as well as the services of Cassidian ensures to offer security concerning information, protection of natural assets, security over critical infrastructure along with protecting national boundaries [4] (EADS, 2013). Astrium Astrium further can considered as one of the major manufacturers of satellite system which provides assured support in terms of space transportation, satellite systems and associated services. The leading satellite system manufacturer also involves different products and services including payloads, ground infrastructure as well as space equipment that intend to facilitate a large number of military as well civil satellite applications. The satellite system of Astrium also tends to encompass different categories of services such as Astrium’s telecommunications satellites, Eurostar family platforms along with internet and TV services to end number of users across the globe [5] (EADS, 2013). Eurocopter According to the present day context, Eurocopter is one of the leading manufacturers which produces civil and parapublic helicopters. The civil and military helicopters of the organisation are produced in different advanced models including EC120, AS550, C3 Fennec and EC225 Super Puma among others which are built to deliver assured support for both public and military segments globally [6] (EADS, 2013). 4. Marketing Process Model of Robert J. Dolan. Source: (Babson College, 2001) Robert J. Dolan identified the “Marketing Process Model” which comprises marketing analysis based on 5 key components and STP model along with marketing mix factors. The model facilitates to identify the prevailing scenario with regard to a product or service in a specific market segment. 4. Marketing Situation Analysis – 5 C Analysis 4.1. Customers In the context of understanding the customer base of EADS, it has been recognised that the organisation has been able to draw significant responses from the global nations towards its range of aircraft products and services. As per the present trends of customer demands from the global nations, it can be stated that the countries seek to develop their defence as well as military infrastructure to protect and to enhance their security. Moreover, from the perspective of commercial services, it has been observed that a rapid competition in the commercial airlines industry is evolving which necessitates EADS to provide quality offerings to ensure its long-term sustainability in the global aircraft segment. The business strategy of EADS is highly focused on developing the value of its range of services among its strong customer base (EADS, 2013). 4.2. Company Mission, Strength and Weakness EADS’ Mission Statement: The organisation incorporates four major divisions through which it serves commercial and military services to the global nations. Therefore, it embarks on fulfilling different missions for its each division according to their respective field and it also ensures to accomplish overall goals of EADS (O’Keeffe, 2010). Airbus The mission statement of Airbus considerably highlights the concept of designing decent and innovative military as well as commercial aircrafts along with serving the global nations at a wider scale (O’Keeffe, 2010). Cassidian The mission statement of Cassidian is also focused on designing and manufacturing high-tech security solutions especially for the military forces as well as for the civil security of the global nations (O’Keeffe, 2010). Astrium Astrium’s mission is to provide beneficial support to all the global nations regarding their military space systems as well as services through designing streamlined military and civil aircrafts (O’Keeffe, 2010). Eurocopter The mission statement of Eurocopter is highly focused on producing military and civil helicopters which entail advanced technologies that aim at ensuring minimum noise and more fuel-efficiency (O’Keeffe, 2010). Strength & Weakness The major strength of EADS in the global aircraft manufacturing industry is the availability of an expanded number of its production as well as selling units across the different regions which ensure to minimise market risks. For instance, the developing regions such as Asia and Latin America are likely to obtain rapid growth which facilitates to derive more advantages for EADS to manufacture its range of aircrafts (Methis & et. al., 2010). In contrast, with regard to weakness, maintaining a lower rate of cash equivalent accounts can impact the company’s business operations due to the availability of fewer amounts of cash for producing aircrafts. According to the 2008 financial report of the company, EADS witnessed lower liquidity levels which had impacted the overall production units of the organisation. Therefore, in order to increase the production performance, EADS must need to focus on its Net Working Capital which can facilitate to operate manufacturing of aircraft products more efficiently (Methis & et. al., 2010). 4.3. Competitor According to the observation of the present aircraft manufacturing corporations, Boeing can be considered as one of the major competitors of EADS in the global market. Inclusion of core values such as leadership, integrity and quality, customer and stakeholder satisfaction, employee cooperation as well as well-built corporate citizenship within the business practices can be considered as the mission for Boeing in the global aircraft manufacturing industry (Boeing, 2013). Strength and Weakness The continuous expansion of its production as well as selling units within the global nations is one of the major strengths of Boeing. Presently, the commercial jetliners as well as defence and security system manufacturer has created alliance with its global customers in 150 nations which ensures to achieve greater response in its respective business segment (Boeing, 2013). However, with regard to weakness, it has been observed that the wage structure of the organisation for its range of workforce is a major drawback. According to the pay and compensation mechanism of the company, it can be observed that the employees are remunerated and compensated according to the currency rate of the country where the company operates. This type of country specific compensation structure may cause several risk for the organisation such as changing interests and currency exchange rates which can affect the company from achieving substantial benefits (Dionisio, 2007). 4.4. Climate or Context (External Environment) It has been observed that EADS considerably plays a major role both in its domestic and overseas markets through providing a range of aircraft service facilities. Moreover, the organisation plays a crucial role for the global nations through effectively harmonising its operations with it external environments where it operates its business processes. The political environment is one of the major drivers for EADS in its continuous development. The organisation is highly committed towards the governments of more than 100 nations in terms of delivering quality aircrafts and other security related services. For instance, the European government is a major supportive factor of EADS which involves both in diplomatic and economic obligations (Methis & et. al., 2010). From the economic point of view, the aerospace and aeronautic industry is one of the major demanding industries, which requires higher investment. Variation of global currency exchange rates is a major factor affecting EADS in its operations (Methis & et. al., 2010). From the perspective of social factor, EADS is one of the key employers, which generates more than 120,000 employments both in European facilities and in other overseas countries. Moreover, the company also manufactures peacekeeping equipments as well as solutions for its global customer base. Thus, it can be stated that nations throughout the world need to have access to the services provided by the company in order to develop social security at a nationalized level (Methis & et. al., 2010). The technological factors for EADS can also be recognised as an essential driver for change which facilitates the company to produce state-of-the-art aircrafts and security associated products and services. It also needs to manage diverse kind of technology based projects by hiring the best assortment of engineers in diverse fields of science (Methis & et. al., 2010). The environmental factor is an important consideration for EADS in its global aircraft manufacturing and selling business. According to the present day context, the organisation has to deal with certain environmental issues while performing its civil activities. EADS ensures that less pollution creating technologies are used by it while manufacturing its products. It has received “Certificat Environment” for ensuring compliance with environmental protection norms within its projects (Methis & et. al., 2010). In the similar context, with regard to legal factors, EADS maintains an effective agreement with different types of legal considerations in the diverse nations of the world while operating its range of business activities. In recent times, EADS had to involve in a commercial dispute at World Trade Organisation because of Airbus. Airbus’ dispute occurred with Boeing regarding purchase of new aircrafts (Methis & et. al., 2010). 4.5 Collaborators EADS makes various collaborations with global partners including government, military as well as civil sector which enables it to obtain an exceptional support which further facilitates the organisation to independently perform business operations. According to the observation of EADS’s global business operation, it can be stated that the organisation seeks to involve collaborative measures in its various operational segments such as manufacturing of aircrafts as well as designing and producing security related systems. For instance, the collaboration with ENN Group Co. Ltd, a leading Chinese distributor which provides energy technologies, solar energy and energy chemicals can be an effective business association for EADS. The scope of this collaboration encompasses technical qualification of airline fuels which is based on algae oil and its promotion for use in Mainland China (ENN Group, 2012). 5. STP - Market Segmentation, Targeting and Positioning 5.1. Segmentation EADS can be identified as one of the biggest aerospace material manufacturing corporations, which has consequently built a dominant position in the respective market. The product portfolio of the organisation is considerably wider as compared to the other competitors. EADS encompasses a significant portion of market segments including military and public range offerings. The organisation mainly targets global aviation industry and military sector in order to be more competent in the respective industry (Methis & et. al., 2010). 5.2. Targeting In order to sustain in the leading position on a global basis in aerospace and defence service providing segment, EADS continuously focuses on its major divisions such as Airbus and Cassidian. Especially, the increasing growth in the aviation industry is a significant factor and a major consideration for EADS. Therefore, the organisation provides a greater focus on its Airbus’ aircrafts to attain a greater profitability within the global market. Moreover, it has also been observed that the defence and security concerned services of the company enable it to capitalise through a large market share in the global business environment. 5.3. Positioning Positioning of products and/or services can be considered as one of the major strategies for an organisation which enables it to achieve a distinctive place among the consumers (Karadeniz, 2009). EADS possesses a broad positioning strategy concerning its range of aerospace and military related products and services. According to its product positioning strategy, EADS incorporates competitive strategies by attaining a large interest of the global aviation marketers. Moreover, the inclusion of advanced technological as well as security concerned aircraft materials and services also offers great benefits for the organisation to achieve competitive position in the global market. In addition, product leadership is obtained by the company by using superior technologies and operational excellence is achieved by providing quality and value-based products and services. From the perspective of customer intimacy, it can be stated that the organisation has been able to build a strong relationship with the governments as well as civil sectors of global nations through delivering streamlined products and services (Habryn & et. al., 2008). With regard to the business performance of EADS, it has been observed that the company possesses ‘More for More’ positioning strategy in relation to producing and delivering its range of aerospace and military assistance products and services. 6. Marketing Mix: 4 Ps Marketing 6.1. Product EADS offers a wide range of offerings which enable it to remain competitive in the market as the products engage more innovation, convenience as well as quality assurance as compared to the other aerospace element manufacturers. For instance, the products such as Airbus which is one of the major aspects of EADS includes a range of commercial as well as military products and services in more than 100 nations across the globe (EADS, n.d.). Similarly, Cassidian, Eurocopter and Astrium also entail advanced commercial and military based features which facilitate the global nations to enhance their security level. 6.2. Price Price of the offerings is also a major factor for the organisations which involves cost of production, delivery charge, warranty and other related costs to place the products to the final consumers (Kotler, 1999). From the perspective of EADS, it has been observed that the company sales its range of aerospace products and services in US Dollars, whereas it manufactures them in Euros. Therefore, it can be identified that the organisation may face challenges concerning product prices due to the changing currency exchange rates between US Dollars and Euros (Methis & et. al., 2010). 6.3. Place Place or distribution of products can be considered to be an important factor which involves arranging products in such a manner so that they are readily available and accessible by its targeted consumers (Kotler, 2009). In the context of EADS, the organisation covers more than 100 global nations where it sales it’s streamlined aerospace as well as defence and security systems products and services through its 33 international offices (EADS, n.d.). 6.4. Promotion The promotion of products and services can be recognised as a marketing communication activity which directly influences the target audiences with regard to the benefits and availability of the products in the market (Kotler, 1999). In relation to promotional activities performed by EADS, it can be stated that the organisation involves such practice especially for its specific brands such as Airbus and Eurocopter divisions in order to broadly draw the interests of the civil sectors across the world. 7. Marketing Strategies to Increase Profit 7.1. Profit Maximisation Strategies According to the business strategy implemented by EADS, it can be stated that the organisation seeks to deliver quality as well as advanced technology based products and services concerning aerospace and defence as well as security system rather than aiming to seek a large number of profits from the market. However, the organisation has also been observed to be enlarging its cash management and profitability amount through effectively developing its business strategies. According to the present business strategy of the organisation, it can be observed that EADS pursues prudent investment portfolios as well as effective structuring of its various costs related to its production. Moreover, the organisation has also developed its cash equivalent account which ensures to achieve higher liquidity, further assuring it to achieve profitable growth in the global aerospace manufacturing industry (EADS, n.d.). 7.2. Financial Key Figures on Accounting Profit Key Figures Source: (EADS, 2010) Present Structure 2008 to 2011 (Revenues per Division) Source: (EADS, 2010) 8. Conclusion EADS is one of the major manufacturers of aerospace materials and defence and security related products and services. The organisation possesses significant product lines for both governments as well as private sectors. In order to sustain in the leading position on a worldwide basis, EADS should highly focus towards increasing the company’s investment portfolios to produce a large number of advanced and high-tech aerospace and military products and services which can facilitate the global nations. It has been observed that the business process of EADS considerably possesses a range of services which are highly emphasised on meeting the requirements of its large base of global customers. Therefore, the continuous development of products and services along with maintaining an effective business structure are the major aspects for EADS to ensure that it is able to build a long-term sustainability in the global aerospace material manufacturing industry. References Babson College, 2001. Marketing Process Model. Exibit. 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Towards a Model for Measuring Customer Intimacy in B2B Services. Karlsruhe Service Research Institute, pp. 1-15. Karadeniz, M., 2009. Product Positioning Strategy in Marketing Management. Journal of Naval Science and Engineering, Vol. 5, No. 2, pp. 98-110. Kotler, P., 1999. Kotler on Marketing: How to Create, Win, and Dominate Markets. Simon and Schuster. Kotler, P., 2009. Marketing Management 13th Edition. Pearson Education India. Methis, C. & et. al., 2010. Strategic Position & Economic Intelligence. Internal Analysis: Strengths and Opportunities. [Online] Available at: http://allmystudies.unblog.fr/files/2010/08/eadsstrategicpositionreport.pdf [Accessed January 21, 2013]. O’Keeffe, N., 2010. EADS Renames Defence and Security Division. Procurement. [Online] Available at: http://www.flightglobal.com/news/articles/eads-renames-defence-and-security-division-347493/ [Accessed January 21, 2013]. Appendix (Bibliography Sites) [1] [2] [3] [4] [5] [6] Boeing, 2013. EADS, 2000. EADS, 2000. 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