Marketing management Essay on: Holland Sweetener Company
1. As the Holland Sweetener Company, how do you expect NutraSweet to respond to your entering the European and Canadian markets? Is it more likely to be an accommodating response (normal competition) or aggressive response (price war)? In considering your response, you should list both the reasons for NutraSweet to adopt an accommodating response (normal competition) AND an aggressive response (price war).
Ans1. As the Holland Sweetener Company, I would expect NutraSweet to respond while entering the European and Canadian markets with an aggressive response i.e. have price wars. Some of the reasons as to why NutraSweet shall adopt an accommodating response (normal competition) and an aggressive response have been listed in the table as under:
| Aggressive Response (Price War) | Accommodating Response (Normal Competition) |
| Þ Company Abilities: The abilities of the company keeping in mind the various factors such as strategic positioning cost structures, capabilities of the firm (Cottmeyer, 2011). The cost structures might lead to high levels of changes within the technology which would in return lead to cut in the prices & trigger price war (Morton, 1994).Þ Customers & Price Sensitivity: Sensitivity in terms of price will help to provide valuable insights that whether one should fight a competitor’s price cut with a price cut in kind or with some other strategy (Stiving, 2012).Þ Competitors Response: A fair analysis of the competitors shall be done by NutraSweet in terms of cost structures, positioning as well as capabilities (Morton, 1994). All these three aspects shall be kept in mind which would affect the strategic positioning of the same (Cottmeyer, 2011). The strategic positioning for the same would be regarded valuable. Wide variations within the prices can be seen amongst various circumstances (Stiving, 2012).
Þ Increased Market Share: With the help of price war, the levels of competition seen within NutraSweet will lead to an increase in the overall market share (Morton, 1994). Though, it is quite painful for the organizations to initiate or respond to the change within the price of NutraSweet (Cottmeyer, 2011).
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Þ Feedback from the customers: feedback from the customers would be referred to as one of the most important aspect which would help to attract more number of customers (Cottmeyer, 2011).Þ Lower Costs: It shall be taken into consideration by NutraSweet that, reduction in the levels of cost by increasing the volume then there would be lead to high levels of price war (Cottmeyer, 2011). It must be taken into consideration that, price war can be in either ways i.e. on the basis of price per unit or cost per unit. Lowering the price by NutraSweet will lead to an overall gross margin which would help to survive within the same (Morton, 1994).Þ Build the right kind of products: The right kind of product shall be produced as well as differentiate it from the competitors in some or the other manner (Stiving, 2012).
Þ Provide better quality: Providing goods with better quality to the customers as well as satisfying the same (Cottmeyer, 2011). Þ Early risk reduction: The risk shall be managed in such a manner which would help in better risk management process for NutraSweet. Þ Market Growth: It shall be seen that, while targeting new market segments sometimes lowering the prices would be of great help (Morton, 1994). With reduced prices or increase amongst the prices will lead to high levels of growth within the market to be conquered. It shall be kept in mind by NutraSweet that, lowering of the prices will lead to increased levels of market growth rate (Stiving, 2012). It shall be kept in mind that, rolling down the prices will affect the overall demand of the product. This would affect the number of customers attracted towards the same & lead to an overall growth in the size of the enterprise. The fastest way of grabbing market growth in today’s world is to reduce the price as compared to its competitors (Morton, 1994). Þ Customer satisfaction: Lastly, the customers shall be fully satisfied. This means that, the products provided to the customers shall be designed in such manner which would help to satisfy their needs & wants in the best possible manner (Stiving, 2012). |
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