(Solved) Case Study on Haier

Added on - 31 Oct 2019

Porters Five Force Model of Haier

This report is on "Porters five force model of Haier". Haier is among the leading brands in the consumer electronics segments and this is owed to its massive presence and brand awareness among consumers. One of the biggest advantages of HAIER group is its strong brand name and global responsive organization since its existence in 1984. Haier’s international expansion program has certainly gained fruit and built a brand image for the group, Various business strategies used by Haier.

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Running Head: Haier case studyHaierCase Study
Haier case study1ContentsStrengths and Weaknesses...............................................................................................................3Strengths......................................................................................................................................3Brand name..............................................................................................................................3Market leaders of refrigeration................................................................................................3Flat organization structure.......................................................................................................3Flamboyant Leadership...........................................................................................................3Technology..............................................................................................................................3Open Innovation......................................................................................................................4Weaknesses:.................................................................................................................................4Lack of Advertising.................................................................................................................4Dependency on china...............................................................................................................4No competitive advantage in international markets................................................................4Absence of brand loyalty.........................................................................................................4Opportunities and threats.................................................................................................................5Opportunities...............................................................................................................................5Ever growing economy............................................................................................................5Rising affordability..................................................................................................................5Advertising..............................................................................................................................5HOPE.......................................................................................................................................5
Haier case study2Threats.........................................................................................................................................6Rising unemployment..............................................................................................................6Increasing interest rate.............................................................................................................6Red ocean market with few entry barriers...................................................................................6Strategic factors...............................................................................................................................6Increasing cost.............................................................................................................................6Deteriorating brand image...........................................................................................................6Organizational structure...............................................................................................................7Core competencies...........................................................................................................................7Industry leaders in the refrigeration segment..............................................................................7Zero distance to customer............................................................................................................7Distinctive competency...................................................................................................................7Research innovation.....................................................................................................................7Technological advancements.......................................................................................................8International expansion....................................................................................................................8Targeting a niche.........................................................................................................................8Differentiated international acquisitions......................................................................................8Localization.................................................................................................................................9Building Production Facilities.....................................................................................................9Joint Venture................................................................................................................................9
Haier case study3Franchisee....................................................................................................................................9Porters Five Force Model................................................................................................................9Buyer Power................................................................................................................................9Supplier Power...........................................................................................................................10Threat of new entry....................................................................................................................10Threat of substitution.................................................................................................................10Competitive rivalry....................................................................................................................10Competition...............................................................................................................................11Haier’s market position..................................................................................................................11Zhang Rhuimin..............................................................................................................................11US Success Story...........................................................................................................................12Strategies to become a market leader............................................................................................12Advertising................................................................................................................................12Price War...................................................................................................................................12Market segmentation.....................................................................................................................13KSA Market...................................................................................................................................13Strengths....................................................................................................................................13Weaknesses................................................................................................................................13Opportunities.............................................................................................................................14Threats.......................................................................................................................................14
Haier case study4Summarization of the case Study..................................................................................................14
Haier case study5Strengths and WeaknessesStrengthsBrand nameOne of the biggest advantages of HAIER group is its strong brand name and global responsiveorganization since its existence in 1984 (Global Strategic Responsiveness, 2017). Currently,Haier is among the leading brands in the consumer electronics segments and this is owed to itsmassive presence and brand awareness among consumers. Higher brand awareness in turn leadsto a higher brand experience and vice versa (Branding and Consumer Behaviour, 2014).Market leaders of refrigerationIn the refrigeration segment, Haier is a long standing market leader (Forbes, 2012). Refrigerationis Haier’s core competency in fact what we learn from the case study is that in order to gainbrand value in a new market, Haier focuses on the refrigeration section to begin with.Flat organization structureUnlike a pyramid structure, Haier focuses a flattened organizational structure to make employeesfeel valued. This boosts innovation and helps keep the firm up to date.Flamboyant LeadershipLeadership of zhang rhuimin who is one of the top 50 management thinkers of the world is oneof the major factors behind the success of the brand. With a wide experience of over threedecades, Rhuimin has built Haier from the scratch and led it to become one of the mostrenowned brands of the world.TechnologyStrength of technology is a pillar that supports Haier’s brand value. Innovative and consistenttechnological developments are an essential part of the group. Recently they launched a new
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Market Segmentation of Haier

From the above report "Porters five force model of Haier", we conclude that Haier is a Chinese group founded in 1984. It is currently led by thought leader Zhang Rhuimin. The group has marked its presence in the consumer electronics and home appliance sector and has a goal of becoming the third largest appliance maker in the work and get listed as a fortune 500 company. The firm started with producing refrigerators in China and soon started horizontal diversification. In the initial stages of its internationalization, the group focused predominantly on the South East Asian markets to build volume and acquire some experience before moving to US and Europe. When it entered the US market it decided to start with their forte which was making refrigerators. Instead of selling a large number of products, Hair worked on building a brand. In 1999, Haier built three stations in US, with a design center in Boston, marketing center in New York and manufacturing unit in South Carolina. The group localized everything in order to gain trust of consumers and show a long term commitment of its presence in America.