Strategic Management

December 2023 Examination

1) You are a mobile phone manufacturer manufacturing phones for different segments of the
population. Sales for your lower segment phones is falling while sales for your higher segment is
increasing.
Why do you think is this happening? What could be the reasons? How do you deal with situation?
Does this need any change of strategy? What changes would you do in strategy? Give valid reasons,
examples while answering the questions. (10 Marks)

Ans 1.

Introduction

A range of elements in the rapidly evolving world of mobile technology have affected consumer tastes
and market dynamics. One such notable phenomenon is the decrease in sales of lower-end phones
and the corresponding increase in sales of higher-end smartphones. This seeming dichotomy might be
the result of a range of social, technological, and even psychological factors. Every mobile
manufacturer must carefully examine these aspects in order to determine the need for and direction
of strategic adjustments. We intend to examine the different causes behind the evolving environment
of mobile phone sales via this inquiry and discuss the appropriate strategic decisions that should be
made.

Concept and application

The mobile phone market, like any other, is driven by a complex combination of economic,
technological, and societal aspects. Let's take a closer look at the reasons for the observed sales trend
and potential strategy changes.

Reasons for Declining Sales in Lower Segment Phones:

Market Saturation: The lower end of the smart phone industry is frequently oversaturate. Many
people who desired a simple smart phone now have one, causing demand for entry-level smart
phones to fall.
Technological Advancements: Consumers place a higher value on sophisticated features and
performance. Lower-priced phones may lack the same level of innovation, camera quality, processor
power, or display technology as higher-priced phones.

Competitive Pricing : Prices have plummeted as a result of severe competition in the lower sector,
making it harder for manufacturers to maintain profitability while developing budget-friendly
products.

Longevity and quality: A prevalent misconception, whether correct or not, is that more costly
equipment are of higher quality and have a longer lifespan. In an age when sustainability and value for
money are more important, customers may want to spend more initially but expect the item to last
longer and function effectively.

Branding and Perception: In today's digital age, the smartphone is more than simply a convenience;
it's a statement. Brands have cleverly positioned higher-end phones as a sign of luxury, prestige, and
even identity. This has shifted purchasing tastes, particularly among younger people, resulting in
increased sales in the higher sector.

Evolving Consumer Needs: As advanced education develops, clients, especially in generally lower-pay
classes, are searching for modern highlights like as more noteworthy camera capacities, seriously
handling power, and, surprisingly, expanded reality encounters. Lower-evaluated telephones might
not be able to stay aware of these rising assumptions.

Consumer Aspirations: As disposable money grows, people may choose to acquire more luxury
products that provide superior user experiences and status symbols.

To address this situation and adapt to changing consumer preferences, the mobile phone
manufacturer may consider the following strategies:

Product Diversification: Introduce mid-range smart phones with a good mix of cost and advanced
features. This might appeal to customers seeking a strong value proposition.

Marketing and Education : Promote the distinct features and benefits of lower-priced phones,
emphasizing their applicability for certain use cases or demographics. Educate consumers on how
these technologies may successfully satisfy their needs.

Brand Image Enhancement: Invest in branding and marketing efforts to elevate the image of lower
segment phones, focusing on quality, reliability, and value.
Economies of Scale: Reduce expenses and sustain profitability in the lower segment by streamlining
manufacturing and supply chain processes.

Customer Loyalty Programs: Implement loyalty programs that reward customers for sticking with the
brand, pushing them to eventually upgrade to higher-end models.

R&D and Innovation: Continue to invest in research and development to create compelling features
and technology that can be incorporated into both lower and higher segment phones.

Market Research: Conduct thorough market research to understand changing consumer preferences
and adapt the product lineup accordingly.

Customization: Offer customization options for lower-end phones, allowing consumers to choose
features that matter most to them while keeping costs in check.

Innovation in the Lower Segment: To revive sales in the lower segment, manufacturers can introduce
innovative features previously exclusive to higher-end models. For example, improved battery life or a
superior camera can make a lower segment phone more attractive.

Brand Repositioning: Given the perception that higher segment phones offer better quality,
companies can invest in repositioning campaigns that emphasize the durability, performance, and
value-for-money aspect of their lower segment phones.

Collaborations and Partnerships: Collaborating with other tech companies can result in bundled offers
or unique features, making the lower segment phones more appealing. For instance, partnering with a
popular camera tech company or an emerging app can attract potential buyers.

Consumer Engagement: Understanding the evolving consumer needs is pivotal. Regular surveys,
feedback loops, and even setting up consumer forums can provide insights into what the current
market requires and expects.

Sustainable Practices: With increasing awareness about sustainability, producing phones that are eco-
friendly, have replaceable parts, or are upgradable can attract a segment of the population concerned
about e-waste and sustainability.

Conclusion

To summarize, the mobile phone sector is not immune to socioeconomic developments, technical
improvements, and changing customer needs. The increase in sales of higher-end phones while
decreasing sales of lower-end phones demonstrates this dynamic. To negotiate such transitions, firms'
strategic planning must be adaptable yet being imaginative. Continuous market research, recognizing
customer goals, and responding to technology advancements are critical. In this case, the approach
can include broadening product offers, investing in novel features for lower-end phones, or adjusting
brand perception to fit with market demands. However, the key is to recognize that in a dynamic
industry like mobile phone manufacturing, the capacity to adapt, evolve, and change is essential.

2) India has been a laggard in the world of Sports. You have been appointed as a consultant for
strategy for building a sports ecosystem in India. Suggest a strategic road map to make India a
sporting powerhouse. (10 Marks)

Ans 2.

Introduction

The roadmap to create India as a sporting powerhouse starts by making our children fall in love with
sports. India has nearly 1.5 million schools and 265 million school children. As voiced by the Prime
Minister earlier this year, it is vital to ensure that “no talent is overlooked”’. Children’s participation in
multi-sport championships at school level will serve as a strong platform for talent scouting. The
solution is building an environment for children to grow in sports. This requires the ecosystem
stakeholders to step in to sow the seeds and curate the sporting culture in India. To encourage large-
scale participation of children, it is essential to build an inclusive and professional multi-sport system
that democratises access and provides transparency. Delivering inspiring sporting experiences at
school level will help identify and groom talent early and set the forward path towards India’s quest
for gold.

Concept and application

To convert India into a sporting superpower, we must adhere to a well-defined strategic road map
that addresses numerous essential factors. The goal of the change should not be only to obtain
international recognition, but to develop a culture of sports and physical health at the grass roots
level, which will serve as the foundation for our success.

1. Grassroots Development:

The grassroots are the foundation of every sport. To genuinely become a sporting superpower, India
must concentrate on developing talent from the bottom up. This includes establishing sports
programs in schools and universities and ensuring that every child has the chance to participate in a
variety of sports. Investing in school sports programs at an early age can help uncover and foster
potential.

2. Infrastructure Development:

One of the biggest obstacles for most sports is a lack of world-class facilities. While cricket venues are
plentiful, facilities for other sports are typically lacking. Comprehensive infrastructure development is
essential to ensure that athletes, regardless of sport, have access to world-class training facilities. This
involves the development of sports facilities, training academies, and the employment of
international-level coaches to give direction.

3. Diversifying Sporting Interests:

Cricket's dominance often overshadows other sports in India. While cricket has its advantages,
broadening one's sports interests ensures that skill is not focused in one area. Sports such as football,
athletics, swimming, and indigenous games can pave the way for a more diverse sports culture.

4. Private Sector Engagement:

The private sector's engagement can function as a catalyst in moving India to the forefront of sports.
Encouraging collaboration between sports organizations and commercial enterprises may result in
sponsorship negotiations, infrastructure development, and expanded scouting networks. The Indian
Premier League (IPL) in cricket is an example of how private investment can transform a sport, and
similar ideas may be applied to other sports.

5. Athlete Welfare and Support:

The athletes' health and safety must be prioritized. This includes physical training, mental health care,
and financial assistance. The state must make certain that athletes get scholarships, stipends, or other
financial incentives depending on their success. This would not only encourage the players, but it
would also reassure their families that they had a future in athletics.

6. Technological Integration:

Technology is used extensively in modern sports, whether for training, performance analysis, or injury
management. Adopting the most recent technology advancements may help athletes fine-tune their
methods, strategize more effectively, and stay healthy. To give its athletes a competitive advantage,
India should pursue cooperation with digital businesses specialized in sports analytics, wearables, and
biomechanics.
7. Promotion of Indigenous Sports:

There are several indigenous sports in India, including kabaddi, kalaripayattu, and malkhamb. India
can not only carve out a position for itself by modernizing and popularizing these sports, but it can
also enhance local economies and tourism. The Pro Kabaddi League exemplifies how modernizing a
classic sport can pique the nation's attention.

8. Public Awareness and Engagement:

The public has a huge impact on a country's athletic culture. The more people participate in different
sports, the better the viewership, sponsorships, and overall interest. Attempts should be made to
educate the general public about various sports, maybe through promotional events, sports festivals,
and media campaigns.

9. Policy Reforms and Governance:

Sports governance changes are required in India to achieve openness, efficiency, and effectiveness.
Policies should be created with a long-term vision in mind, embracing all aspects of sports, from talent
discovery to player retirement benefits. An effective and clean governance framework can attract
more investments and guarantee that resources are used to their full potential.

10. Collaboration and Exchange Programs:

Interactions with countries excelling in particular sports can provide valuable insights.
Exchange programs where coaches, trainers, and even athletes visit other nations to train and learn
can be invaluable. For instance, collaborating with Brazil for football or with Kenya for long-distance
running can offer fresh perspectives and techniques.

11. Performance Analysis and Feedback Loop:

A continual feedback loop is required to determine what is and is not functioning. Performance
indicators must be examined, not just in terms of medals but also of infrastructure utilization, athlete
progression, and public involvement. This analysis should then be sent back into the system, revising
policies and ensuring the country stays on track.

Conclusion
A nation's skill in athletics does more than merely gain medals in the vast tapestry of countries; it
develops solidarity, instills pride, and promotes general well-being among its population. A diverse
and flexible strategic strategy is required for India to become into a worldwide athletic powerhouse.
The blueprint for creating a flourishing sports environment entails more than just infrastructure and
talent development. It will take a profound cultural transformation to elevate sports to the level of
national relevance that education and health have. It is critical to engage stakeholders at all levels,
from the rural youngster dreaming of running tracks to the officials forging the nation's destiny. India
can do this by utilizing its massive people resources, incorporating new technology, and taking
inspiration from its indigenous sporting legacy.

3) You are the marketing strategy head for a major online music service. Your business is dependent
on advertising, but, despite the large number of consumers listening to your app. Advertisers have
not been enthused to advertise. (5 Marks)
a. What strategy should you adopt to get advertisers on board? Give examples to justify your answer.

Ans 3a.

Introduction

Online music services have grown in popularity in the digital era, providing users with a vast selection
of music at their fingertips. While having a large user base should ideally be appealing to marketers,
there might be obstacles that dissuade them. If advertisers are hesitant to spend, it indicates a
mismatch between the platform's perceived value offer and the real requirements or expectations of
the advertisers. To close this gap, the platform's marketing approach must be reevaluated and
innovated.

Concept and application

To attract advertisers to your online music service, you can adopt the following strategies:

Audience Segmentation : Advertisers should be provided with precise audience demographics and
behavioral data. Demonstrate to them that you have a thorough grasp of your user base. Advertisers
can establish customized ads if you can demonstrate that a large fraction of your visitors fit into a
specified age group or genre preference.

Data Analytics : Use data analytic to demonstrate the effect of advertising on user engagement and
conversions. Share data on conversion rate improvements, click-through rates, and user involvement
to illustrate the efficacy of your platform's advertising.
Ad Formats: Ad forms should be introduced and varied. Provide a variety of ad formats, such as
display advertisements, audio commercials, sponsored playlists, and interactive promos. Allow
marketers to select the format that best fits their marketing goals.

Partnerships: Collaborate on co-branded initiatives with well-known musicians, influencers, or music-

Personalization: Allow marketers to target consumers based on their music tastes and listening history.
For example, if an advertiser wants to market a new fitness product, they may target people who
listen to exercise play lists regularly.

Pricing Flexibility: Offer a variety of price alternatives, such as pay-per-click, pay-per-impression, or set
rates. Provide tiered pricing based on ad placement prominence and time.

User Interaction: Create dynamic ad experiences that engage people with the brand. A user, for
example, might click on an ad to learn more or to receive special offers.

Case Studies: Share prior campaign success stories on your platform. Showcase how other marketers
have profited from using your business. This increases your platform's trust and confidence.

Conclusion

In a crowded digital advertising market, it's critical to distinguish one's platform not just by user
numbers, but also by the quality of interaction and the inventiveness of advertising solutions. An
online music service may build a convincing case for advertising investment by concentrating on
delivering value for both the user and the advertiser. The goal is to strike a balance between user
experience and advertiser exposure, to leverage data for precise targeting, and to continually
innovate in ad forms. Advertisers may be lured to regard the platform not just as another advertising
channel, but as a strategic partner in their marketing activities by taking a proactive and collaborative
approach.

b. Create two ideas to engage with advertisers. (5 Marks)

Ans 3b.

Introduction
In this age of digital contact, the success of online music platforms is dependent not just on user
involvement but also on attracting advertising. While the user base is diverse and dynamic, keeping
the platform appealing to marketers necessitates customized techniques. It is critical to create
distinctive and immersive engagement propositions to guarantee marketers sense actual value and a
distinct advantage over rival channels.

Concept and application

b. Here are two approaches to engaging advertisers:

Advertiser Workshops: Hold workshops or webinars in which your marketing team discusses insights
and best practices for developing great ad campaigns for your platform. This teaches marketers how
to get the most out of your service.

Organize a tournament or event where advertisers may show off their unique ad material. Encourage
them to create original, eye-catching advertisements. The winning commercials may be prominently
shown on your platform.

Conclusion

In today's competitive digital market, engaging advertisers entails more than just providing ad space.
It's about offering one-of-a-kind experiences, collaborating, and ensuring their brand message
connects with the platform's audience. The "Innovation Lab" and "Storytelling Sessions" are not only
advertising methods, but efforts to form long-term collaborations. Online music platforms may
position themselves as vital partners in the brand's journey by providing outlets for advertisers to
express, innovate, and resonate with users.