Strategic Management of Advertising Industry | Case Study
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Added on 2019-09-26
Strategic Management assignmentQuestion 1:Case study: GLOBAL FORCES AND THE ADVERTISING INDUSTRY. (Refer the attached texts adapted from: Exploring Strategy by Johnson et al. TenthEdition, Pearson)Task 1: Perform and critically analyse an environmental audit upon the advertisingindustry using two models introduced in this module (50 marks)Question 2:a)Choose either Samsung or IKEA and analyse their business strategy for theirproducts and services using Porter’s generic strategies (30 marks)b)How successful are these strategies (20 marks)Additional Assessment Guidance:The assignment should answer all three questions and tasks. Answer should clearlyindicate question numbers and task numbers.Students are encouraged to use relevant examples in their answers in order toamplify the points they are making (where appropriate).Total word count:2000 words (+/- 10%), using the APA referencing system.(Note) Learning outcome to be achieved: On successfully completing this module, students should be able to:Conduct an environmental audit of an organisation using appropriate theoriesand frameworks and critically evaluate th impact of these variables.Discuss a wide range of strategic choices available to an organisation forachieving strategic objectives.Justify potential strategies, ensuring their suitability, acceptability and feasibilityto key organizational stakeholders.
Assessment CriteriaContents1.Deep understanding of concepts2.Application of concepts3.Critical analysis of strategies4.Critical evaluation of strategic outcomesReferences:Core texts:Essential reading:Johnson, G., Whittington R., Scholes K., Angwin, D., & Regner, P. (2013) Exploring Strategy, Text and Cases, 10th edition Prentice Hall.Indicative Reading:Coulter, M. (2012), Strategic Management in Action (6th ed.). New Jersey: Prentice Hall.Jones, G. R., & Hill, C. L. (2013). Theory of Strategic Management with cases. Australia: South Western/CengageLynch, R. (2012). Corporate Strategy (6th ed.). London: Prentice Hall.Thompson, J. L, & Martin, F. (2010). Strategic Management: Awareness and Change (6th ed.). [S. I]: Thomson Learning/CengageJournals:Harvard Business ReviewMIT Sloan Management ReviewMcKinsey QuarterlyStrategic Management JournalJournal of Management Studies==================================================================
Case study: GLOBAL FORCES AND THE ADVERTISING INDUSTRY.Adapted from: Exploring Strategy by Johnson et al. Tenth Edition, PearsonIn the second decade of the millennium, advertising agencies faced a number ofunanticipated challenges. Traditional markets and industry operating methods,developed largely in North America and Western Europe following the rise of consumerspending power in the twentieth century, were being radically reappraised.The industry was subject to game-changing forces from the so-called ‘digital revolution’with the entry of search companies like Google and Yahoo as rivals for advertisingbudgets. Changing patterns in global consumer markets have impacted on both industrydynamics and structure. Budgets being spent through traditional advertising agencieswere being squeezed as industry rivalry intensified.Overview of the advertising industryTraditionally, the business objective of advertising agencies is to target a specificaudience on behalf of clients with a message that encourages them to try a product orservice and ultimately purchase it. This is done largely through the concept of a brandbeing communicated via media channels. Brands allow consumers to differentiatebetween products and services and it is the job of the advertising agency to position thebrand being so that it is associated with functions and attributes which are valued bytarget consumers. These brands may be consumer brands (e.g. Coca-Cola, Nike andMercedes Benz) or business-to-business (B2B) brands (e.g. IBM, Airbus Industrie andKMPG). Some brand target both consumers and businesses (e.g. Microsoft andApple).As well as private-sector brand companies, governments spend heavily to advertisepublic-sector services such as healthcare and education or to influence individualbehavior (such as ’Don’t drink and drive’). For example, the UK government had anadvertising budget of £285 m (€325) in 2012. Charities, political groups, religiousgroups and other not-for-profit organisations also use the advertising industry to attractfunds into their organisation or to raise awareness of issues. Together these account forapproximately 3 per cent of advertising spend.Advertisements are usually placed in selected media (TV, press, radio, internet, etc.) byan advertising agency acting on behalf of the client brand company; thus they are actingas ‘agents’. The client company employs the advertising agency to use its knowledge,skills, creativity and experience to create advertising and marketing to drive