Allama iqbal open university

Maria javedMba IT

TOPIC:Formulation and application of focus stratagy

Main headings:

Introduction to the topicImportant sub-topicsPractical study of the organizationSwot analysis Conclusion recommendation

Definition of focus stratagy:

A marketing strategy in which a company concentrates its resources on entering or expanding in a narrow market or industry segment.A focus strategy is usually employed where the comopany knows its segment and has products to competitively satisfy its needs.

Steps of formulation of focus strategy:

1-Analyze the current situation

2-Set a clear strategic direction

3-Develop a small set of initiatives

4-Establish a detailed action plan - for everyone

5-Align the organization

Levels to operate formulation of focus strategy

corporate strategy

The guiding principles and planned objectives set by management to be followed by an autonomous division of a company.

business unit strategy

A plan that details how a business will use its production resources to meet its goals.

The overall scope and direction of a corporation and the way in which its various business operations work together to achieve particular goals.

Operational strategy

Situations where a focus strategy works best :

When it is costly or difficult for multi-segment rivals to serve the specialized needs of the target market nicheWhen no other rivals are concentrating on the same target segmentWhen a firm's resources do not permit it to go after a wider portion of the marketWhen the industry has many different segments, creating more focusing opportunities and allowing a focuser to pick out an attractive segment suited to its strengths and capabilities.

The risks of a focus strategy

Competitors find effective way to match a focuser’s capabillities in serving nich.

Nich buyer preference shift towards product attributes desire by majority of buyers the nich become part of the overall market.

Segment become so attractive it becomes crowed with rivals causing segment profit to be splintered.

Focus strategy has two variants:

They are followings

Cost Focus: Cost focus is where a firm seeks a cost advantagein the target segment. This is basically a niche-low cost strategywhereby a cost advantage is achieved in focuser’s target segment.

Differentiation focus:Differentiation focus is where a firm seeks differentiation in the target segment. In this the firm offers nich buyers something different from rivals.

Following are the situations where a focus strategy is efficient:

Focus has efficient resource.

Focuss is able to define challanges.

Market segment has good growth potential.

Market segment may not be large enough to generate profits

Focuser can reduce competition from new firms by creating a niche of its own

Focuser is able to choose differents advantages of focus strategy.

Practical study of the organization

INTRODUCTION:

The Coca-Cola Company is the world’s largest beverage company with almost 500 brandsranging from the actual Coca-Cola to products such as Sprite, Fanta, POWERADE, Minute Maid, and many, many more. The Coca-Cola Company is the world's number one maker of soft drinks, selling 1.3 billion beverage servings every day. Coca-Cola's red and white trademark is probably the best-known brand symbol in the world.

Our Mission:•To refresh the world...•To inspire moments of optimism and happiness.•To create value and make a difference.

Our corporate vision is to become “The undisputed leader in every market in which we compete”.

Our vision

Our Purpose:

“Bring togetherness, spread happiness and inspire a better future” motivates our employees to make a meaningful contribution to business and society.

Focus on the Market:

•Focus on needs of our consumers, customers and franchise partners•Get out into the market and listen, observe and learn•Possess a world view•Focus on execution in the marketplace every day•Be insatiably curious

Coca cola is a company that knows that their main priority is to reach their products to the customers. Coca cola focuses on improving the product itself either by design, taste, ingredients, size, convenience, and many other factors. Coca-Cola’s target market satisfies a wide variety of cultural consumers around the world. Moreover, their products target people who are health conscious and people who are on a diet. Their products do fit all age groups from the young to the old. There are Coca-Cola products for the athletes who train for a sport, such as Powerade (Coca-Cola Product).

Product/Market Focus

Swot analysis

Strength:

•The coca cola sells beverages in around 200 countries.•It have brand awareness in the world.•Srtong marketing and advertising•People like taste and quality of cocacola around the world.•Coca cola logo is very famous among the people

Weakness:

•No presence in the snacks and food industry•Customer are not being able to differentiate among few brand such as coca cola zero and diet.•Most of the beverage supply is restricted to the few country•Lack of innovation

Opportunities

•Inovation•Overtake competitors.•Increase awareness program.•Launch healthy drinks.

Threats•Ongoing recession •Changes in consumer preferences•Water scarcity•Legal requirements to disclose negative information on product labels•Decreasing gross profit and net profit margins•Competition from PepsiCo

Conclusion

Focus strategy is very important for any organizatin. In the differentiated focus, the company seeks to produce different products just within a narrow market section. A focused strategy will allow you to connect the user experience to a clearly defined business and user value.In cost focus, Coca-Cola may notice it wise to charge low price on the same product some sections of the market.The company may decide to label differently the same product and low prices tagged for the benefit of specific consumers.

Recommendation

To achieve these goals, we should continue to focus our efforts

working with The Coca-Cola Company to develop a business model to continue exploring and participating in new lines of beverages, extending existing product lines and effectively advertising and marketing our products.

implementing selective packaging strategies designed to increase consumer demand for our products and to build a strong returnable base for the Coca-Cola brand.