Diversification - Essay Example

Diversification- An Organizational Strategy of the Marketing Name of the Concerned Professor August 14, 2011 Diversification- An Organizational Strategy Introduction The first and foremost challenge before the marketing managers is to keep on looking for market opportunities that could enhance the existing levels of business performance. In that context, the management of a business organization does always have varied strategies at its disposal.

Diversification is one such organizational strategy that allows for business growth by exploiting the available opportunities that hitherto exist outside the scope of a corporation’s business (Kotler, 2003, p. 101). Diversification Diversification is an organizational strategy, which is resorted to primarily for risk reduction. Diversification allows the organizations to go through tough times, by looking into other possible sources of revenue, under adverse circumstances that may translate as drying up of the existing markets, a contraction in the growth potential of existing markets or the emergence of new competition.

Diversification allows the companies dip into alternate attractive industries and markets, which could be exploited by the dint of just the right mix of business strengths that a company has at its disposal (Kotler, 2003, p. 101). Kotler has referred to primarily three types of diversification strategies (2003, p. 101). To begin with, an organization may decide to opt for new products that though appeal to a different set of customers, do tend to have technological and marketing compatibility with the already existing products (Kotler, 2003, p. 101). Secondly, an organization may decide in favor of new products that though technologically unrelated to the current products, do harbor an appeal to the existing customers (Kotler, 2003, p. 101). Finally, a company may go for an entirely new business that is hitherto, totally unrelated to the existing technologies, markets and products (Kotler, 2003, p. 101). Delta Airlines Delta Airlines has certainly resorted to diversification in varied aspects of its business.

It has up-to-dated it’s already existing baggage handling facilities and has taken them online to make the overall travelling experience more customers friendly and accessible (Delta, 2011: Online). Delta has computerized its itineraries and check in facilities to allow the customers to manage their upcoming travel details like online check in, seat selection, change in travel plans, etc online (Delta, 2011: Online). Hence, Delta has modified the existing services to make them more attractive for the customers.

In addition Delta has introduced some new services like Pet Travel (Delta, 2011: Online). Delta has tagged with many flight partners to broaden its flight horizon, thereby adding to its product range (Delta, 2011: Online). In addition Delta has entered the new industries by setting up Sky Malls and Delta Heritage Museums to sell travel related merchandize (Delta, 2011: Online). The company has reconfigured and reinvented its products aimed at corporate travelers, offering more comfort and convenience (Delta, 2011: Online).

It has entered the vacations business offering the associated services like car rentals and hotel accommodation (Delta, 2011: Online). Hence Delta has resorted to all the three types of diversifications strategies mentioned by Kotler. Conclusion Hence, diversification is an apt organizational strategy that allows the organizations to accomplish growth in times marked by tough competition, emerging markets and upcoming new technologies. References Delta. (2011). Delta: About Delta. Delta.com.

Retrieved August 14, 2011, from http://www.delta.com/about_delta/index.jsp Kotler, Philip. (2003). Marketing Management. New York: Pearson Education Inc.