Mormor Magda's Ice Cream: Strategic Analysis & Market Expansion Plan

This case study analyzes Mormor Magda’s marketing strategies, focusing on cost leadership, differentiation, and focus strategies. The report compares these strategies and suggests that a focus strategy is most beneficial for the company. It also recommends adopting market penetration, market development, and diversification strategies from the Ansoff Matrix to facilitate business expansion. The analysis concludes that innovation and promotion techniques are key to the company's success, and leveraging these strengths will enable further growth. Desklib offers similar solved assignments and resources for students.

MARKETING AND MANAGEMENT

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Introduction
The main aim of this report is to understand the strategies analysis of the company. In this
report, the discussion is made on the strategies of the companies. In this report, a case study
of Mormor Magda’s has been taken into consideration to analyse the strategies of the
company. The report is classified in two parts in which the first part of the report talk about
the strategies use by the company and recommendations will be discussed in the second part
related to strategies.
Comparison of strategies
As per the case study, it has been analysed that the company uses the three strategies to
expand the business in the large areas. The three strategies adopted by the company are cost
leadership, focus and differentiate strategies. Porter’s generic theory defines the two ways in
which the company gain the competitive advantage and these are cost leadership and
differentiate.
(Source: Mind Tools, 2018)
Cost leadership strategy defines the prices criteria of the company due to which the company
attain the competitive advantage. Differentiate strategy states the differentiation in the

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product as compare to the other competitors in order to attain the competitive advantage.
Focus strategy refers that the company has to more focus on one product as compare to the
other products to grab the high market share. These strategies have different opinion and
techniques to grab the market share and attain the competitive advantage (Panwar, Nybakk,
Hansen, and Pinkse, 2016).
As per the case study, these strategies help the company in different way to achieve the
success in the market. The company used the cost leadership strategy by setting the prices of
the product on the basis of size and time. But the company used the differentiate strategy by
introducing the innovative ice cream in the market such as waffle cones (Berndt, and
Melander, 2018). The focus strategy is used by the company by more focusing on the quality
of cream at time of manufacturing. These strategies are used in different ways but the purpose
of using those strategies is different from the other strategies.
The cost leadership strategies and differentiate strategy are the narrow concept while the
focus strategies are the broad concept. Focus strategy include the both the concept of cost
leadership and differentiate strategies because by focusing on one product the company is
taking care of its prices as well as its differentiation. It has been seen that the company also
more use the focus strategies as compare to the cost leadership strategies and differentiation
strategies (Pulaj, Kume, and Cipi, 2015).
In this case study, the company does not use the cost leadership strategy more because there
are many competitors in the market who sell the ice cream with the quality. The quality of
product is maintained with the high cost. The company used the differentiate strategy so that
they can compete with the competitors in terms of product instead of price. The company use
the natural ingredients such as strawberries to manufacture the quality of products and attain
the large market share (Hill, 2017).

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It has been seen that the company promote the products through the social media in the
market. The company share their product information on their webpages and social sites
which attracts the customer to buy their ice cream. The focus strategy concentrates on the
particular market to understand the customer needs and demand. It also contains the
promotion techniques in order to increasing the sale of particular product (Berndt, and
Melander, 2018). The differentiation strategy and cost leadership strategy helps the company
to compete with the competitors but the focus strategy helps to increasing the sale of the
product.
It is observed that the focus strategy is more useful for the company as compare to cost
leadership and differentiation strategy. The cost leadership is necessary for the company to
determine the profit or to attract the customer. The differentiation strategy is also important
for the company in order to differentiate the product from the others. But the focus strategy is
the only strategy which contains the qualities of these strategies. As per comparison of these
strategies, it has been founded that the company has to use the focus strategy instead of the
other strategies (Rothaermel, 2015).
Strategies Adopted By the Company
As per the analysis of the case study, it has been founded that the company has to adopt the
market penetration, market development and diversification strategies. These strategies are
the strategy of Ansoff Matrix which is used by the companies in order to expand the business
(Hanlon, 2018). In this case study, the owner of the company “Angela Hafstrom” also wants
to expand the business in the different areas. That is why; these strategies are appropriate way
to expand the business in the different segments.
Market penetration Strategy

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It defines that the company has to expand the business in the existing market with the existing
product. The company build the strong network with the different entrepreneurs through crow
funding campaigns. The company has to use this network to expand the business in the
different areas by increasing the capital. High capital helps the company to invest in
promotion of the product or in maintaining the quality of product. The company can grab the
market share by attracting the large number of customer towards their ice-cream (Doz, 2017).
Market development Strategy
It defines that the company has to enter the new market with the existing product to reach at
the different customer in order to increase the sale of the product. As per the case study, it has
been analysed that the company has many customer who wants to buy their ice-cream but due
to far distance they cannot buy it. The company has to reach at those customers and also
target the new customer so that the sale of the product is increases. Before enter the market,
the company has to analyse the market and the demand of the consumer for the ice-cream
products. It is observed that the company highly used the social media to promote the product
(Berndt, and Melander, 2018). The company can also use this social media in order to analyse
the market by the reaction of customers on the sites. It is beneficial for the company to
expand the business in the new market.
Diversification Strategy
Diversification strategy defined that the company has to expand the business in the new
market with the new product. Although, the company introduce the new products with the
high innovation but the company has to introduce these products in the new market to attain
the attention. The company can easily attain the attention with their innovative product in the
market (Bagella, 2018). It is observed that the company launched the waffle cones in the
market which helps the company to achieve the success but after a time the sale is decreases.

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The company has to enter the market with the new product so that it can achieve the success
by attaining the large number of customers. The company has strong relation with the
different entrepreneurs due to which it can take the different ideas in order to manufacture the
new product. The company has to organise the shareholders meeting and analyse their point
of view for the expansion of the business. This strategy is beneficial for the company in order
to achieve the objective of the company (Bowen, Baker, and Powell, 2015).
Conclusion
From the above analysis, it has been concluded that the company achieved the success due to
their innovation and promotion techniques. By comparing the strategies of the company, it
has been founded that the Focus strategy is more beneficial for the company to achieve the
objective of the company. The company has to adopt the market penetration, market
development and diversification strategy in order to expand the business. The company will
achieve the success by taking the advantage of their strength.

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References
Bagella, M. (2018) Finance, investment and innovation: theory and empirical evidence.
Routledge.
Berndt, A. and Melander, A. (2018) Mormor Magda’s Ice cream: Can You Be Hot In a Cool
Market. [online] Available from: 2973703_1932928250_Assessment2-IndividualCaseStud
%20(5).pdf
Bowen, H.P., Baker, H.K. and Powell, G.E. (2015) Globalization and diversification strategy:
A managerial perspective. Scandinavian Journal of Management, 31(1), pp.25-39.
Doz, Y.L. (2017) Strategic management in multinational companies. In International
Business (pp. 229-248). Routledge.
Hanlon, A. (2018) The Ansoff Model. [online] Available from:
https://www.smartinsights.com/marketing-planning/create-a-marketing-plan/ansoff-model/
[Accessed 10/1/19].
Hill, T. (2017) Manufacturing strategy: the strategic management of the manufacturing
function. Macmillan International Higher Education.
Mind Tools. (2018) Porter's Generic Strategies. [online] Available from:
https://www.mindtools.com/pages/article/newSTR_82.htm [Accessed 10/1/19].
Panwar, R., Nybakk, E., Hansen, E. and Pinkse, J. (2016) The effect of small firms'
competitive strategies on their community and environmental engagement. Journal of
Cleaner Production, 129, pp.578-585.
Pulaj, E., Kume, V. and Cipi, A. (2015) The impact of generic competitive strategies on
organizational performance. The evidence from Albanian context. European Scientific
Journal, ESJ, 11(28).

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Rothaermel, F.T. (2015) Strategic management. McGraw-Hill Education,.