Soc Essay Example | Topics and Well Written Essays - 750 words

Soc - Essay Example I once attended a celebration of a Chinese new year which they call Kung Hei Fat Choi which is really a different celebration of New Year from my culture. For one, the celebration was replete with firecrackers and loud noises in their belief to scare away bad omens. They also had a dragon dance which they believe to bring good luck and rounded foods. This type of celebration is considered alien to me because we do not do dragon dance in celebrating New Year nor prepare round foods. To explain my seeming alienation about Chinese New Year, I would like to bring about George Herbert Mead’s social psychological theory of relation among the mind that not all factors in my environment can influence how I think. I belong to _____(your primary group) as my primary group and ____(your formal organization) as my formal organization. I am basically comfortable with my primary group albeit it has no formal structure where other people of the group, including myself are just enjoying each other’s company. The formal group on the other hand is more structured and has an objective why it exists. It reflects the normative organization because there are rules that are expected to follow where its members are expected to conform. In the primary group, my status varies since the structure is informal. Sometimes I am the leader and opinion maker sometimes I am the follower depending on the situation. In the formal organization however, my status is labeled as a member because I am not an officer of that club. At the end of the game, I belonged to the middle class because I had enough property to sustain me in the game. The game basically made me realized that if you make enough investment early in the game, you will end up rich because when other players step into your property, they have to pay rent and this accumulates as the game goes. Having enough resources in the game made me realized that it will enable the player to

The Tesco Loyalty Card Scheme

The Tesco Loyalty Card Scheme Today the businesses have become customer centric and the marketing mix of 4 Ps is now being replaced by 30 Rs (Gummeson2008). Companies are more focused on delivering the value demanded by the customers, they are creating exit barriers for the customers by maintaining good relationships with them to retain them and earn lifetime loyalty. Today in highly competitive markets getting new customers is costlier and more difficult than maintaining the existing ones. So, companies are putting more emphasis on Zero Defection Strategy and maintaining their customer relationship as best as possible. In this essay we will critically evaluate the loyalty scheme run by Tesco to manage its customer relationship and the RM techniques followed by the company with different target segments that whether they are successful or need some improvement in future. TESCO PROFILE: Tesco, a European based company is the biggest and the most profitable supermarket chain in UK. It is considered to be the fastest growing company and a successful supermarket in the world selling almost everything, from food to clothing and operating through both geographic locations and internet. (Retail loyalty scheme2003, Corporate profile Tesco2004). Tescos success so far is based on its marketing relationship strategies which it has maintained through the launch of Club cards in 1995(Mitchell, Peck2007). It has effectively used the scheme targeting different customers segments, for attracting and retaining them. Tescos main approach is to create value for the customers and earn lifetime loyalty and they try harder for customers than anyone else. (Corporate profile Tesco2004). They have taken advantage of major changes in the lifestyle and it is the key for their continuous success. Relationship Marketing: Gronroos has defined relationship marketing as, An approach to establish, maintain and enhance relationship with the customers and other partners at a profit, so that objectives of the partners involved are met and this can be achieved by mutual exchange and fulfilment of promise. Thus, relationship marketing is an approach to establish and maintain good relationships with the customers in such a way that, no party is in loss and there is a room for profit for both the parties. Keeping customers in the first line of defence and winning their loyalty is the main theme of RM. Loyalty ladder Model: The model was suggested by Kotler 1997 for categorising customers on the basis of relations formed with them or repetition of purchases. Partners Members Advocates Clients Repeat customers First time customers Prospects Tesco Company uses loyalty ladder and commitment based segmentation to retain its existing customers and it has categorised them in 6 different stages. These are: logged on cautionary developing established dedicated logged off (needs win back the confidence) Tesco works with them in the sequence upside down as believe that newest customers can make an impression or lose it. Tesco uses automated event messaging for encouraging them for regular purchase. Whenever customers register themselves, they are prospect and needs motivation to buy. After 2 days, receives a registration e-mail along with  £5 discount on first purchase and the journey begins. Now they are first time customers or cautionary buying for the first time at discount and receive an e-mail asking about their experience and then another discount on next purchase. They keep on receiving bi- weekly alerts and e-newsletter on exclusive and personalised offers. On the top of mailing procedures the company offers Clubcard loyalty schemes to the dedicated customers with variety of incentives such as shop with the partners of Tesco, doubling the points on regular purchase and memberships with the clubs offered by Tesco. Now they are the established ones word of mouth will increase companys reputation and brand equity. By joining the clubs they become members of the company. If company comes to know that a customer is not buying for a long period then a reactive e-mail is sent to survey if he is having some problem with incentive of  £ 5. These are the logged off needs winning back the confidence with further incentives. Thus Tesco manages its customers and try not to lose them. RM techniques of Tesco, the loyalty card scheme: Customers loyalty plays an important role in RM, as their loyalty through repeat purchase and word of mouth with other customers can not only bring higher revenue for the company but new customers also. Tesco has managed all this through its Clubcard scheme; this is a membership card which allows the customers to save their money on shopping at any store of Tesco group of the companies or its partner companies and getting price off vouchers or Club card vouchers after collecting 150 points. As they win points on every pound they spend on shopping and after a limit these points get doubled, so such a scheme motivate the customers to buy more and earn points. On the other hand generate good revenue for Tesco groups. Such a loyalty scheme has enabled Tesco to increase its market share in grocery (squid2009) and overtake Sainsbury as a number one retailer. Following Tesco, many other companies like ASDA, Safeway and Sainsbury tried to run the loyalty card scheme but were unable to manage and match the success of Clubcard and failed. How club card helped in retaining existing and attracting new customers: The biggest challenge faced by the companies is to make their loyalty scheme, effective and appealing to the customers. Retailers need to clearly define the target segments, anticipate their needs and fulfil them properly to be successful (McGoldrick2002). Same is done by Tesco, as per the promise made by the company to create value for the customers it has provided club cards to the members and created following clubs where the members can shop and save money. Tesco targets 10 years old buy to 80 years old man as its customer and effectively offers benefits and value to all its targeted segments through these clubs. Members get magazines on different issues and price off vouchers from these clubs creating a creditability and loyalty for the company in the heart of the customers. The clubs for different segments are: Tesco Kids Club: This club offers products and fun culture for kids of age 5 to 8 years and it is their parents choice to join the club for kids and buy gifts for them. They provide them with the tips for safety and health of the kids to the parents to create creditability and soft corner on parents heart. (harlequin1,2001) Tesco Baby and Toddler club: This club offers tips and advice about the child care and pregnancy tips to would be parents or pregnant ladies. Club provides them parking area closer to the store to facilitate the ladies and such a deed builds strong relations and trust for the Tesco Company and customers prefer the club for a long. Tesco Healthy Living Club: The club offers magazines and booklets for health tips and it is for the middle aged or old people who want healthier living. It also provide price off coupons on organic and dairy foods to promote its Healthy and Organic foods and win creditability as a health conscious retailer. Tesco World of Wine Club: it provides a good and new range of wine for those to like to drink and promotes it through price offs to attract some new customers too. It also gives information about what kind of food goes with which wine. Tesco Food club: it provides its members cooking tips and teaches them techniques to cook easy, enjoyable and tasty food. How To videos for cooking facilitate the members to watch and learn the making of the meal and even they get mails about ideas for simple weekdays meal and menu. Like these Tesco have some more benefits too like greener living cards, association with Air miles company etc but its success is more dependent on its partnership with many other companies like Powergen electricity and gas supplier, beefeater restaurants, National Tyres and Avis car hire etc and customers can use the clubcards to deal with these companies also. Besides this, online shopping, Tesco petrol stations, Tesco mobile and credit cards also add points for the customers. Thus integrated approach of Tesco for maintaining relations both with the businesses and the customers helps the company to win trust of the customers. Clubcard as a CRM Tool The loyalty card scheme presented by Tesco acts as a CRM tool for the company collecting necessary information about customers buying habits and their specific needs. For getting club cards, customers have to get registered through filling a form online, on paper or through telephone. This form seeks the necessary information about the customers helping the company to design their marketing strategies as well as develop new products and offer them to the customers in a cost effective manner. Every year, nearly all the transactions held at Tesco are linked with the customers profile and now it has become companys philosophy to maintain and retain good relations with customers (ICMR, 2003). By getting information about the customers, company is able to understand its customers better and can serve them in the best possible way. Tesco consider the scheme as a learning process through which it can know about the customers, what they want from the retailer and how they shop and provide th em the value and benefits asked by the customers and promised by the company. (Humby, 2003) The reward system of discounts and price offs has enabled the company to successfully maintain the relations with the customers. Critical evaluation: Clubcards loyalty schemes have enabled Tesco to grow as a no.1 retailer in UK market leaving the competitors behind who were not able to run such schemes profitably. The Clubcard customers are also benefited by the schemes as they can shop and earn points with Tesco partners. Company listens and modifies its activities on their recommendations such as Wine club and Kids Club. (Rowley2007). But it was not successful in all the target market such as student segment.(Retail loyalty Scheme2003) and not able to still attract the students segment by offering them the benefits like special discounts as many retailers in UK do such as Peacocks, Apple store etc.(aceltham.co.uk2010). Also the redemption process of the vouchers is time consuming as it is through post and not online. Even the redemption value of the clubcard points is also very low. (Tesco2010). Not that loyalty schemes really makes the customer loyal because customers pay for the service they received which contributes to store loyalty and repetitive purchase.(Turner Wilson2006) So, it is necessary for Tesco to emotionally appeal the customers and manipulate their interest as in the competitive world switching to the competitor costs very low for the customers. Would Tesco be successful without the ClubCard: Tescos success depends on its targeting different segments and fulfilling their needs by developing strategies and products as per the demand. All this it can manage through its loyalty schemes. Many others companies have also tried such schemes, as Nectar, managed by Loyalty Management UK Ltd also offers the rewards and points on shopping from its members(Rowley2005) but not as successful as Clubcard. Tesco considered as CRM champion after the launch of loyalty scheme because it was able to win trust and loyalty of their customers both in behavioural and attitudinal form. The whole credit goes to the Tesco management who has effectively formulated the strategies for the target segments, derive information about their needs through their profile and delivered the value with the help of its CRM tools (ICMR2003). Even the rewards and benefits gained by the customers from its partners also helps in retaining the customers as they found it costlier to switch to other company. So, we can say without Clubcard, Tesco would have to struggle a lot to become as successful as it is now. Recommendations: Track the polygamous loyalty customers and provide them with better incentives for their better word of mouth as they deal with many loyalty schemes and make them feel that Tesco is better than others. Take advantage of modern communication technology and allow online chat rooms. Regular emotional attachment with the customers will lead to behavioural and attitudinal loyalty. Attract student segment by offering them additional discounts more than other segments. It costs five times more to acquire a new customer than to retain the existing one so company needs to apply positive switching barriers for customer retention.(Gee, Coates and Nicholson2008) Appropriate monitoring is required to evaluate that customer defection is not covered up by customer acquisition. (Gee, Coates and Nicholson2008) Tesco can provide a combination of currency-points flexibility. (Strategic Direction 2007) Analyse the LTV or estimated profitability of the customers and then allocate companys resources to them such as marketing spend. (Day, 2003) . Conclusion: After going through the relationship strategies and loyalty schemes of Tesco, it can be said that with the help of single loyalty scheme, it was able to target and address customer segments of different age groups. Club cards act as a CRM tool for the company and company has adopted the culture to follow the customers needs and reward them accordingly. Tesco has effectively managed the loyalty scheme and was able to win the trust and loyalty of the customers in return which helped the company to grow so far. It is advisable that company should maintain its relationship marketing strategy and loyalty scheme and redesign them as needed to provide the differentiated advantage to the customers forever. References: Gummeson Evert. (2008). Total Relationship Marketing. p36-40, third edition. Elsevier ltd. Mitchell H. Peck H. (2007). Does Tesco hold all cards. Cranfield school of management. Peck, Payne, Christopher, Clark. (1999). Relationship marketing for competitive advantage, keeping and winning customers. Reed educational and professional publishing ltd. Retail loyalty scheme, myth or marvel, Tesco. (2003). Available at : http://www.businessteacher.org.uk/free-marketing-essays/tesco-marketing-essay. Last accessed 3/04/2010. Tesco club card. (2010). Available at : http://www.tesco.com/clubcard/clubcard/clubs.asp. Last accessed 3/04/2010 Loyalty scheme helps tesco grow. (2009). E money news. Available at: http://www.squidcard.com/corporate/emoneynews/loyalty/loyalty-scheme-helps-tesco-grow218.html. Last accessed 3/04/2010 Tesco plc, company profile. (2010). Available at: http://uk.finance.yahoo.com/q/pr?s=TSCO.L. Last accessed 3/04/2010 Michael Jorgenson. (2009). Tesco.com. How they do it. Available at: http://www.scribd.com/doc/22655210/Tesco-com-%E2%80%9CHow-Do-They-Do-It-%E2%80%9D. Last accessed 3/04/2010 Corporate profile Tesco. (2004). Corporate watch. Available at: http://archive.corporatewatch.org/profiles/tesco/tesco1.htm. Last accessed 3/04/2010 Christian Grà ¶nroos. (1994). From Marketing Mix to Relationship Marketing: Towards a Paradigm Shift in Marketing Management Decision, Vol. 32 No. 2, , pp.4-20. MCB University Press Limited, 0025-1747. Harlequin1. (2001). Tesco kids club. Available at: http://www.dooyoo.co.uk/offline-shopping-misc/tesco/305681/. Last accessed 3/04/2010 ICMR. (2003). Tesco- the customer relationship management champion. Available at: http://www.icmrindia.org/casestudies/catalogue/Marketing/MKTG070.htm. Last accessed 3/04/2010 McGoldrick, P. (2002). Retail Marketing 2nd edition. Maidenhead: McGraw-Hill. Humby, C., Hunt, T. Philips, T. (2003). Scoring Points: How Tesco is winning customer loyalty 1st Edition: Kogan Page Limited. Rowley J. (2005). Customer relationship management through the Tesco Clubcard loyalty scheme. International Journal of retail and distribution management, Vol. 33, p196-206. Rowley J. (2007). Reconceptualising the strategic role of loyalty schemes. Journal of Consumer Marketing, p.366-374 Emerald Group Publishing Limited. Peacocks special offer. (2010). Available at: http://www.aceltham.co.uk/acebusinesses.php?id=217. Last accessed 3/04/2010 Apple store. (2010). Students discounts. Available at: http://store.apple.com/uk/browse/home/education_routing. Last accessed 3/04/2010 Tesco. (2010). Clubcard points. Available at: http://www.tesco.ie/clubcarddeals/. Last accessed 5/04/2010 Turner Wilson. (2006). Grocery loyalty. Tesco Club card. British Food Journal, Vol. 108 No. 11, 2006, pp. 958-964. Gee, Coates and Nicholson. (2008). Understanding and profitably managing customer loyalty. Marketing Intelligence Planning, Vol. 26 No. 4, 2008, pp. 359-374 Strategic direction. (2007). Vol. 23, No.2, pp 18-22. Day, G. (2003), Creating a superior customer-relating capability, MIT Sloan Management, Review, Spring, pp. 77-82. TATA STEEL (B2B) CONTEXT Contents: Abstract 12 Introduction 12 Tata Steel Profile 12 Branding Steel 12 Customer Base Brand Equity Model 13-14 The Initiatives act as CRM tools 15 Benefits Reaped with Branding 16 Critical evaluation 16 Recommendations Conclusion 16 References 17 Abstract: The report is about the B2B relationship of Tata Steel Company that how they manage their relationships with their business customers and the techniques they apply for the same. Critical evaluation will be done of the techniques that whether these are appropriate or any recommendation required will be given to the company. Introduction: B2B marketing is the practise of doing business with other organisations or the businesses not the ultimate consumers. This practise is not new and is old as commerce itself but the concept of B2b marketing is quite recent. Companies sell their products to other companies and organisations to resell them or use the components or products for manufacturing the stuff, they are offering to the end users or support their activities. Today the focus is on maintaining relations with the customers as who is the customer today will be tomorrow also if they are being treated well. (Morgan Hunt1994)The organisation has to manage these relationships for acquisition and retention of the customers. For acquisition they need to create value for them and for retention they need to enhance the value offered or sustain it. (Morris, Pitt, Honeycutt2001). We will evaluate the B2B approach followed by the Tata Steel, the model followed to collect information about their business customers and strategies they followed to make their customer happy. Tata Steel Profile: Tata steel, a part is Tata Group is the worlds sixth largest steel producer operating in more than 20 countries. In past few years with the investment in Corus, millennium steel and NatSteel Holdings the company is able to create a marketing and manufacturing network in South East Asia, Pacific-rim countries and Europe with the capacity to produce every year 30 million tonnes of crude steel. (docstoc.com2010, Tata steel 2010) In year 2001 and 2005, it was ranked as worlds best steel company. (Kotler2006). The profitability of the steel companies depend on the business cycles, they can make profit in the times of boom in the economy and loose it in the recession. Even the external environmental factors also affects the revenue generation of the companies. So to reduce the dependence on the business cycles and make continuous flow of revenue Tata steel adopted the strategy of branding,(ICMR2004) so that customers would buy the brand and pay the premium for the value added services provided to them with the brands. Tata Steel has also launched various initiatives for promoting its brands such as CVM, RVM, CAMs and ecommerce. The strategy they follow to create relationships with the business customers is branding, CRM initiatives and e commerce. Branding steel: A successful business marketer knows the customer needs and offers them the same. Tata has also recognised its customers in two segments the end users and businesses organisations using steel for the manufacturing of their products mainly automotive industries such as Maruti, Ford, Telco, Honda etc and realised that 80% of the sales is being covered by these business sectors, so it formulated different strategies for B2B and B2C segments. The companys B2B customers are more knowledgeable and brands help to create good finance and public awareness for the company. (Kotler,2006). So, Tata steel branded its products under following brands: Tata Steelium for cold rolled steel Tata Shaktee for galvanized sheets Tata Tiscon for re-bar Tata Wiron for wires Tata Agrico for hand tools and implements Tata Pipes etc. Customer Based Brand Equity Model: The model was suggested by Keller(1993,2001,2003) and constitutes of four stages through which brand is created and built its equity and strong relations with the customers. The model can be used in both B2C and B2B context. The model is in form of ladder going upward and it is subdivided in form of blocks in pyramid. (Kuhn Alpert, Keller2001) Lets see how Tata Steel branding policy fits in the CBBE model. http://www.frost.com/prod/servlet/cio/142401287 The model has four phases for creating, enhancing and maintaining relationship with the customers through brands. Creating identity for the company or the product: First of all the company needs to create awareness among the business customers about the product. Variety of steel is available in the Indian steel market and it becomes really difficult for the customers to differentiate that which one will be suitable for their use. Keeping that in mind, Tata Steel focused on customers need and then branded the steel to facilitate its business customers. Now they can order the variety or brand needed. Delivering value: The company realised that its B2B customers are more knowledgeable than ultimate customers, they dont buy the brand rather are keener about the quality, specificity and performance of the steel. So, for better performance of the product and satisfying customers psychological needs the company has promoted the brands in accordance with its usage as Tata Tiscon for constructional bars and Tata Shaktee for roofing and NatSteel for cold rolls etc. For making the scheme successful, brand management department has been created in 2002 to evaluate and train the staff and sales personnel accordingly. They focused on making more and more interactions with the customers to understand their needs and offer them the needful in a better and improved way. They made their branded products highly value added to beat the industry and take the company to new heights of success. (Kotler2006). Following the excellence model of Tata (TBEM), the company kept on making improvements in its offerings and undertaken many initiatives such as Retail Value Management, Customer Value Management and Customer Accounts Managers to help their business customers in brand promotion, building brand equity and solving their grievances.(Improvement initiatives,2009) Customers positive responses: It is related with the responses given by the customers on the basis of the judgement and feelings associated with the brand that how far the products were successful in satisfying their needs.(Keller2001) With the continuous improvement in the offerings and CRM initiatives the company was able to place itself as the Worlds Best Steel Company in 2001 and 2005,(Kotler 2006) by the studies done by World Steel Dynamics, USA. Its bearing division became the preferable supplier for Hero Honda and Toyota motors and they recognised the company as Zero ppm Supplier and Direct Online Supplier. (docstoc2010) Maintaining strong relationships: Tata steel was successful in making strong relationships with its business customers and 60% of its products are sold through contracts and company spend 1.3% of its turnover in maintaining its brands.(Kotler2006). Branding of steel is providing the business customers a stable price of the commodity which creates a good impact on the business customers mind. Aligning with the Tata Groups internationalisation initiatives, the company was able to acquire NatSteel Asia and Corus UK as both the companies were seeking to establish long strategic alliances with the reputed steel companies of the world and Tata was able to do so with its deep social commitment towards society, trusted and reputed relations with the stakeholders.(Noronha2006,2007) The initiatives for maintaining successful relationships: Along with the branding, some more customer centric initiatives has been undertaken by the company for better understanding of the customers and direct and continuous interaction with them to maintain strong relationships with their customers. (improvement initiatives2010) Retail Value Management: The initiative was started in 2002 to redefine the concept of retailing and build stronger relations with the rural retailers by educating them about the selling techniques and customers need. The company has planned to target the small retailers operating in the rural areas and enhance the retail chain to near about 4000 retailers and serve the rural market personally by integrating retailers in the program and research done by the company help the retailers in selling the product according to the customers specific need. (Media releases Tata,2006, High beam research2006) Customer Value management: Tata steel has started the initiative to retain and build strong relationships with its customers. These were designed to deeply understand needs of the business customers and deliver improved value added products. They build teams to study the value chain of operations like receiving, storing, deploying of steel by the customers and even rejection. The company was able to understand the problems related with the value chain and provide deep insights to solve them at an effective and less cost. Thus company was able to win loyalty of the customers by making the supply chain (sales team, dealers and retailers) more customer focused and customer sensitive (Pullanikkat 2010, Economic times 2007) Customer account manager: Company has maintained separate accounts for the customers for improvement and focus on business customers. The accounts were categorised as under: Enterprise accounts: potentially large and long term accounts. Commercial accounts: the key accounts Distribution: for the customers accessed through distributors. (docstoc2010) Such an initiative helped the company to classify their customers on the basis of their transactions and now they can deal with these customers accordingly. This also helped in solving their problems and grievances and increase interaction with them for better understanding. (Kotler2006, scribd.com2009) E business: Tata steel has started the initiative for e business looking forward to tap the opportunities of information technology. These are E-procurement and E-sales, the e- procurement allows the business customers to get multi dimensional information, such as online and offline quotations logging for auction, inbound supply chain, order placement, material receipt and delivery compliance monitoring. Some new and value added features like negotiation chat rooms for reverse auction, e-mail notifications and acknowledgement and FAQs are also offered. (E-procurement system, Tata steel 2010) Benefits Reaped: The Company is able to succeed so far due to the its relationship marketing through branding, strategic alliances as well as other initiatives focused on customers need and building long term relationships with them. Through its strategic alliances especially with Corus, the company has moved on from fifty sixth position to the sixth largest steel maker in the world.(Norohna2007). Mr Muthuraman, managing director, Tata Steel says Branding helped the company in gaining both the tangible benefits in form of pricing and intangible benefits in form of loyal customers. The successful RM startegy so far has made Tata Steel Worlds Best Steel company and has started co branding initiative in 2003 with the automobile companies such as Ashok Leyland and Telco (ICMR2004) and has decided to move on with co-branding in consumer durable sector. Critical evaluation: B2B customers focused more on functionality or performance rather than taste or aesthetics as customers on consumer market do. (Anderson Narus,1999). Tata steel has taken the initiative of branding steel to protect itself from fluctuations in business cycles and set a premium price on steel through brands. Through its regular upgrading and customer focus was able to become the most preferable brands in steel. But there are price sensitive customers in industry that seems steel as a commodity not a brand and are not ready to pay premium prices for that. The company needs to educate and create awareness among these customers.(Norohna2003). Tata steel is selling steel under different brand so it should be careful that customers may not be intense and actively loyal with all the brands, they may experience resonance with a particular brand.(Keller2001). Branding is related with making a promise to the customer and delivering it so far but if in any case company fails to deliver the bran d meaning it can lose its market position and customer may move on to the competitors. Online branding technique is now getting popular in western countries and as Tata steel operates in six continents why hasnt taken the initiative yet? The company also finds challenging, the management of the channel to sell the branded products in near future, says Mr Muthuraman. Conclusion and Recommendations: The above report shows the Tata steel strategy followed for B2B relationship marketing. The company has managed it with branding the steel and remained customer centric by adopting and launching various initiatives like CVM, RVM, CAMs and e-commerce. As, it has been noticed that branding has not only helped the company to generate regular flowing revenue but also helped in maintaining long term relationships with the customers and become the preferable supplier of the customers. Such initiative has also made feel the importance of relationship marketing to the other steel makers. Along with the success, relations with business customers have brought about new challenges for the company which needs some recommendations: Regular check on the product quality is needed as brands provide quantitative and qualitative satisfaction to the customers. Brand awareness among the price sensitive customers as among these some can turn to be the loyal customers. Online branding initiative should

Full Fathom Five :: Full Fathom Five Essays

Full Fathom Five In Sylvia Plath’s poem, "Full Fathom Five" she describe her father in beautiful and abstract terms which signify aspects to the relatioship Plath had with her father. This poem, along with other works from Sylvia Plath, provide a lot of insight into the type of relationship she might have had with her father. The imagery Plath uses to describe her father is reminiscent of fairy tails and monsters, where the idea she gives me about her father is a larger-than-life character which is made of the sea; huge, with white hair, and beard. She describes her father's hair as a huge net, which gives him a larger than life size, common to the perception a young girl would have of her father. Another word that comes to my mind when thinking about her father is that he was an extremeley fathomable figure in Plath's life, something very possible due to the fact that her father died when she was barely eight years old. This is consistent with the title of the poem 'Full Fathom Five'. Plath's view of her father as this large fable-like, mythical characater. In the poem she describes him as one who 'surfaces seldom'. This line refers to her not knowing her father for a long time, and at the time she did know him (from birth to age eight) she was quite small and vulnerable compared to the formidable presence of ones father. Another clue to Plath's reverence towards her father is the reference she makes to him being 'inscrutable'. A young child is very likely to see their father as difficult to approach, or ask questions. An ideal father is one who is loving and approachable, but Plath's description of her own father conveys neither feature. Undoubtedly a troubled childhood which can be infered from this poem is consistent with the subsequent events of Sylvia Plath's life. Plath went through years of depression, eventually commiting suicide in 1964. I suspect that Plath had a great deal of anger surrounding her fathers death, perhaps for leaving her so early. Yet at the same time, she expresses an anger for the life her father led while he was living, implicating some sence of insest in their relationship. Plath wrote another poem about her father entitled 'Daddy' in which among other things, Plath calls her father a bastard. Full Fathom Five :: Full Fathom Five Essays Full Fathom Five In Sylvia Plath’s poem, "Full Fathom Five" she describe her father in beautiful and abstract terms which signify aspects to the relatioship Plath had with her father. This poem, along with other works from Sylvia Plath, provide a lot of insight into the type of relationship she might have had with her father. The imagery Plath uses to describe her father is reminiscent of fairy tails and monsters, where the idea she gives me about her father is a larger-than-life character which is made of the sea; huge, with white hair, and beard. She describes her father's hair as a huge net, which gives him a larger than life size, common to the perception a young girl would have of her father. Another word that comes to my mind when thinking about her father is that he was an extremeley fathomable figure in Plath's life, something very possible due to the fact that her father died when she was barely eight years old. This is consistent with the title of the poem 'Full Fathom Five'. Plath's view of her father as this large fable-like, mythical characater. In the poem she describes him as one who 'surfaces seldom'. This line refers to her not knowing her father for a long time, and at the time she did know him (from birth to age eight) she was quite small and vulnerable compared to the formidable presence of ones father. Another clue to Plath's reverence towards her father is the reference she makes to him being 'inscrutable'. A young child is very likely to see their father as difficult to approach, or ask questions. An ideal father is one who is loving and approachable, but Plath's description of her own father conveys neither feature. Undoubtedly a troubled childhood which can be infered from this poem is consistent with the subsequent events of Sylvia Plath's life. Plath went through years of depression, eventually commiting suicide in 1964. I suspect that Plath had a great deal of anger surrounding her fathers death, perhaps for leaving her so early. Yet at the same time, she expresses an anger for the life her father led while he was living, implicating some sence of insest in their relationship. Plath wrote another poem about her father entitled 'Daddy' in which among other things, Plath calls her father a bastard.

Essays Solution

Workshop 3 Interest Rates and Bond Valuation Terminology †¢Face value/par value – the original issue price (the amount borrowed). †¢Maturity date – date on which loan has to be repaid. †¢Coupon interest rate – original interest rate on the bond. †¢Coupon payment – the fixed interest payment on the bond. †¢YTM=required rate of return. ?Bonds pay fixed coupon payments at fixed intervals and the face value at maturity. ?there is an inverse relationship between the price of an investment and the rate of return on the investment – if you pay a higher price for an investment your rate of return must be lower (holding all other factors constant)) ?If the YTM = coupon rate the bond will sell for the face value (i. e. current price = face value). ?If the YTM > coupon rate the bond will sell for a discount (yield goes up, price goes down). If the YTM < coupon rate the bond will sell for a premium (yield goes down, price goes up). Disc ussion 1. Identify the three most important determinants of the price of a bond. Describe the effect of each? Answer The three factors affecting the price of a bond are – coupon – yield – term to maturity. T > The relationship between price and coupon is a direct one – the higher the coupon, the higher the price. The relationship between price and yield is an inverse one – the higher the yield the lower the price, all other factors held constant. The relationship between price and maturity is not so clearly evident. Price changes resulting from changes in yields will be more pronounced, the longer the term to maturity. 2. Given a change in the level of interest rates, discuss how two major factors will influence the relative change in price of individual bonds. AnswerFor a given change in the level of interest rates, two factors that will influence the relative change in bond prices are the coupon and maturity of the issues. Bonds with longer matur ity and/or lower coupons will have the greatest price changes in response to a given change in interest rates. Other factors likewise cause differences in price volatility, including the call features, but these factors are typically much less important. 3. What is the purpose of bond ratings? Answer Bond ratings provide a very important service in the market for fixed income securities because they provide the fundamental analysis for thousands of issues.The rating agencies conduct extensive analyses of the intrinsic characteristics of the issue to determine the default risk for the investor and inform the market of the analyses through their ratings. 4. What are the important assumptions made when you calculate the promised YTM? Answer The most crucial assumption that the investor makes is that cash flows will be received in full (i. e. investors hold the bond to maturity) and reinvested at the promised yield. 5. You expect interest rates to decline over the next 6 months.What kin d of bonds do you want in your portfolios in term of duration and explain your reasoning for this choice. Answer Given that you expect interest rates to decline during the next six months, you should choose bonds that will have the largest price increase, that is, bonds with long durations. 6. Which of the following bonds will have the greatest percentage increase in value if all interest rates decrease by 1 percent? a. 20-year, zero coupon bond. b. 10-year, zero coupon bond. c. 20-year, 10 percent coupon bond. d. 20-year, 5 percent coupon bond. AnswerSince a zero coupon bond’s price today is determined just by the NPV of its par value, all of its payment is discounted for the maximum amount of time, whereas a coupon bond has many payments discounted for less than the maximum amount of time. Therefore, a zero coupon bond is most affected by interest rate changes. So, the longest zero coupon bond is the correct answer, which is statement a. 7. Which of the following statements is most correct? a. All else equal, long-term bonds have more interest rate risk than short-term bonds. b. All else equal, high-coupon bonds have less reinvestment rate risk than low-coupon bonds. . All else equal, short-term bonds have less reinvestment rate risk than do long-term bonds. d. All of the statements above are correct. Answer Statement a since high-coupon bonds have more reinvestment rate risk than low-coupon bonds and short-term bonds have more reinvestment rate risk than do long-term bonds. Problems 1. Two years ago you bought a government bond for $1,000 because you liked the 10% p. a. coupon interest payment that you would receive for 10 years. Interest on the bond is paid annually. Two years later, when the market interest rate has fallen to 8% p. a. what is the value of your bond? SolutionSince coupon rate is 10% and YTM has fallen to 8%, it must be the case that the price of this bond has increased (remembering the inverse relationship between bond price and yie ld). 2. The Morgan Corporation has two different bonds currently outstanding. Bond M has a face value of $20,000 and matures in 20 years. The bond makes no payments for the first six years, then payS $800 every six months over the subsequently eight years, and finally pays $1,000 every six months over the last 6 years. Bond N also has a face value of $20,000 and a maturity of 20 years; it makes no coupon payments over the life of the bond.If the required return on both these bond is 8 percent compounded semiannually, what is the current price of bond M? and bond N? Solution The price of any bond (or financial instrument) is the PV of the future cash flows. Even though Bond M makes different coupons payments, to find the price of the bond, we just find the PV of the cash flows. The PV of the cash flows for Bond M is: PM = $800(PVIFA4%,n=16)(PVIF4%,n=12) + $1,000(PVIFA4%,1n=2)(PVIF4%,n=28) + $20,000(PVIF4%,n=40) PM = $13,117. 88 Notice that for the coupon payments of $800, we found th e PVA for the coupon payments, and then discounted the lump sum back to today.Bond N is a zero coupon bond with a $20,000 par value; therefore, the price of the bond is the PV of the par, or: PN = $20,000(PVIF4%,40) = $4,165. 78 3. Bond P is a premium bond with a 9 percent coupon. Bond D is a 5 percent coupon bond currently selling at a discount. Both bonds make annual payments, have a YTM of 7 percent, and have five years to maturity. What is the current yield for bond P? for bond D? if interest rates remain unchanged, what is the expected capital gains yield over the next year for bond P? for bond D? Explain your answers and the interrelationship among the various types of yields.Solution To find the capital gains yield and the current yield, we need to find the price of the bond. The current price of Bond P and the price of Bond P in one year is: P:P0 = $90(PVIFA7%,5) + $1,000(PVIF7%,5) = $1,082. 00 P1 = $90(PVIFA7%,4) + $1,000(PVIF7%,4) = $1,067. 74 Current yield = $90 / $1,082. 00 = . 0832 or 8. 32% The capital gains yield is: Capital gains yield = (New price – Original price) / Original price Capital gains yield = ($1,067. 74 – 1,082. 00) / $1,082. 00 = –0. 0132 or –1. 32% The current price of Bond D and the price of Bond D in one year is:D:P0 = $50(PVIFA7%,5) + $1,000(PVIF7%,5) = $918. 00 P1 = $50(PVIFA7%,4) + $1,000(PVIF7%,4) = $932. 26 Current yield = $50 / $918. 00 = 0. 0545 or 5. 45% Capital gains yield = ($932. 26 – 918. 00) / $918. 00 = 0. 0155 or 1. 55% All else held constant, premium bonds pay a high current income while having price depreciation as maturity nears; discount bonds pay a lower current income but have price appreciation as maturity nears. For either bond, the total return is still 7%, but this return is distributed differently between current income and capital gains.

Effects Of National Culture Essay

Since 1988, our world has changed in a myriad of ways. As dictatorships have risen and fallen and new democracies have formed, the political culture of our society is much different than in the years of the late Cold War. In addition to political changes, new technologies, including the world wide web and satellite communications have allowed people in different nations to communicate much more effectively. This research in this paper is very outdated, not taking into account the new market, trade laws, interest rates, or other economical factors of today’s international business world. The article, â€Å"The Effect of National Culture on the Choice of Entry Mode,† was written in 1988 by Bruce Kogut and Harbir Singh, of the Stockholm School of Economics and the University of Pennsylvania, respectively. The authors believed there were several means of entry into foreign markets, including joint ventures, wholly owned greenfield (start up) investments, and by acquisition. The authors examined these methods in depth and analyzed the means by which the businesses not only started up, but operated in foreign markets as well. The authors reviewed statistics, data, and literature, and formed hypothesis as to which methods were being used most, and in what industrial sector(s). The first means that some businesses entered and operated in a foreign country is through the acquisitions method. The acquisitions method entails purchasing a sufficient amount of stock to control the primary shares of a certain company. This method might be considered â€Å"buying out† a foreign company already in existence. However, as currency exchange rates and interest rates fluctuate on a daily basis, this would be trickier in today’s market. For example, 20 years ago, the dollar, the Japanese yen, the Canadian dollar, and the Indian Rupee were worth very different amounts. More importantly, the Euro was not in use, as many of the countries in Eastern Europe in particular, were under communist control. Today, as countries have become more aware of these fluctuating rates, it might be harder or riskier to enter a market through the acquisitions method. In addition, free trade laws and regulations also regulate who can buy what and how much in a foreign market. The second means is a joint venture method in which two or more firms share the assets and profits of a certain company. Again, the same problems might exist as in the acquisitions method, with fluctuating currency exchange rates affecting profit. For example, if a business operated in both China and the United States, as economies changed and foreign tax laws changed, the company could fall under financial strain. The influence of firm experience on entry choice has played a prominent role in several of the studies employing the Harvard Multinational Enterprise Data Base. In their pioneering study on the ownership structure of American multinational firms, Stopford and Wells [1972] found joint ventures, relative to wholly owned activities, were less likely to be chosen, the more central the product to the core business of the firm and more experience the firm had in the relevant country. Similarly, they found that marketing and advertising intensity, as well as research and development intensity, discouraged the use of joint ventures. (Kogut & Singh 1988) This mindset would make sense, as it is hard to run a successful business in one culture, let alone worry about marketing, advertising, and research costs. It also would make sense that two countries might not respond the exact same way to a business plan and marketing techniques. The third means of entry is a greenfield, or start-up, investment, completely new to the foreign market. While some of the challenges of tax laws, currency exchange, and interest rates would also affect this means, the biggest obstacle might be the cultural barriers. Although the world is getting smaller each day thanks to the internet and satellite communications, hundreds of languages and dialects are still spoken throughout the world. This might lead to a communications problem if a foreigner attempted a greenfield investment. Besides language barriers, marketing and advertising techniques would need to be researched in order to be effective in a new country. The authors argue that joint venture is almost a cross between the two other methods, greenfield, and acquisitions. Many studies, as discussed later, have treated greenfield and acquisition as representing alternative entry modes, with joint ventures being only a question of the degree of ownership. This approach implies that entry and ownership involve two sequential decisions, the first deciding whether to invest in new facilities or to acquire existing ones, the second one on how ownership should be shared. Whereas such an approach is clearly defensible on both theoretical and empirical grounds, we treat joint ventures as a choice made simultaneously with other alternative modes of entry. (Kogut & Singh 1988) For this reason, joint ventures can be described as a gray area in foreign business acquisitions. For example, if a company bought out another one, or merged with another company, while retaining some of the business practices and/or staff, it would probably be considered a joint venture. The authors theorize that Greenfield entry is the best way, or at least that was what they believed in 1988. Due to the difficulty of integrating an already existing foreign management, cultural differences are likely to be especially important in the case of an acquisition. Indeed, empirical studies on mostly domestic acquisitions have shown that post-acquisition costs are substantial and are influenced by what Jemison and Sitkin [1986] call the organizational fit of the two firms. They define organizational fit as â€Å"the match between administrative practices, cultural practices, and personal characteristics of the target and parent firms† (Jemison and Sitkin 1986, p. 1471. Sales and Mirvis [1984] document in detail the administrative conflicts following an acquisition when both firms differ strongly in their corporate cultures. In contrast to the integration costs of an acquisition, a joint venture serves frequently the purpose of assigning management tasks to local partners who are better able to manage the local labor force and relationships with suppliers, buyers, and governments [Franko 1971; Stopford and Wells 1972]. Thus, a joint venture resolves the foreign partner’s problems ensuing from cultural factors, though at the cost of sharing control and ownership. Unquestionably, a joint venture is affected by the cultural distance between the partners. But such conflict should not obscure the original motivation to choose a joint venture because the-initial alternative of integrating an acquisition appeared more disruptive than delegating management tasks to a local partner. Of course, a joint venture may be troubled not only by the cultural distance of the partners, but also due to concerns over sharing proprietary assets. A wholly owned greenfield investment avoids both the costs of integration and conflict over sharing proprietary assets by imposing the management style of the investing firm on the start-up while preserving full ownership. (Kogut & Singh 1988) In 2008, businesses would face some of the same challenges as in 1988, such as the cost of integration, conflict of sharing proprietary assets, and administrative and management differences. However, as more and more businesses have gone global, most countries would have contracts and lawyers defining clear parameters on such details. The authors came to this conclusion by testing two hypothesis. The first focused on cultural differences. Kogut & singh (1988) said that, â€Å"The greater the cultural distance when the country of the investing firm and the country of entry, the more likely a firm will choose a joint venture or wholly owned greenfield over an acquisition. † This hypothesis primarily focused on the costs of running and managing a business from a greater distance. The second hypothesis as stated by Kogut & Singh (1988) stated that, â€Å"The greater the culture of the investing firm is characterized by uncertainty avoidance regarding organizational practices, the more likely that firm will choose a joint venture or wholly owned greenfield over an acquisition. † As with all unknowns, a foreign company could not be expected to know the exact way a business and marketing plan would be executed and responded to in a foreign market. Basically, the data found that uncertainty was the main reason companies tended to shy away from acquisitions and enter the market through a greenfield or joint venture method. This reason would still hold true today as the world market fluctuates and recessions come and go. The studies also noted that the methods of entry into a particular market varied depending on the product, service, or industry. There is a clear difference in industry patterns among the modes of entry. Joint ventures are relatively more frequent in pharmaceuticals, chemicals and electric and nonelectric machinery. Acquisitions occur primarily in natural resources, financial services, and miscellaneous manufacturing industries. Chemical and electrical machinery are especially attractive industries for greenfield investments. At a higher level of aggregation, acquisitions tend to be relatively more common than other modes of entry in nonmanufacturing sectors of the economy. (Kogut & Singh 1988) The article, since it was written 20 years ago, analyzed data primarily from the industrial sectors of resource, paper, chemical, petroleum, metal, rubber, machinery, electrical, transportation, and instrumentation. It had some analysis of data in communications, wholesale, financial, and other services. Now, in 2008, the list would include a lot of new data for technology, automobile, computers, and pharmaceuticals, to name a few. The list would also be inclusive of customer service outsourcing, a practice common among many technology and computer companies. Furthermore, new sanctions have been imposed on some natural resources. It may not be possible, for example, for a foreign company to come in and control an oil field, a diamond mine, or a rainforest. Such companies might be required to work jointly with a company in the nation they wish to do business, thus keeping it a joint venture somewhat. In 2008, any analysis of entry into foreign markets would also mention the oil trade, and the complexities that accompany it. As the recent conflict in Iraq has shown us, cultural differences and political challenges may hamper easy trade and setting up business in a middle eastern country. In the next few years, as new automobiles are developed to hopefully not be as oil-dependent, the market will change yet again. Another difference in automobiles are the influx of foreign cars to the United States, and the continual race to develop the most fuel-efficient car amongst competitors throughout the world. The article analyzed data primarily from the United States, Western Europe, and Japan. It found differences based on these countries. Again, there are strong differences among the modes of entry. For Japan, 46 of its 114 entries are joint ventures. Whereas Japanese acquisitions are not common, Japanese firms have a high proportion of the wholly owned Greenfield investments. Scandinavia and, especially France, also lean towards joint ventures. United Kingdom represents the other extreme; 111 of its 141 entriesare acquisitions, with the remainder evenly divided between joint ventures and greenfield. (Kogut & Singh 1988) Twenty years ago, the European Union was not in existence and many Eastern European Countries were under communist rule, thus meaning they had very different laws, regulations, and business practices than they do today. The Euro was not yet a currency, so trading and doing business amongst European nations was also very different. Also, the article makes little mention of a very new powerful force in the global market: China. As China has made tremendous economic and technological gains in this decade, it has begun to not only dominate the world market, but also branch out and do business in foreign countries. This relationship is reciprocal as European and American businesses are also looking to enter the Chinese market at the same time. Another item the article looked at which is very different today than 20 years ago is the size of businesses. They sought to understand whether or not larger businesses entered a market usually one way, while smaller businesses did something else. Obviously, while larger firms may have had more resources to acquire, smaller firms may have had the flexibility to do so more frequently. It stands to reason that the larger the investing firm, the greater its ability to acquire. Despite the logic, the empirical evidence is mixed. Dubin [1975] found that smaller firms tended to acquire relatively more frequently than large firms, though he did not control for other factors. In his cross-sectional tests, Wilson (1980) confirmed Dubin’s findings. However, these studies drew upon entry data of the largest corporations of the United States and other European countries. Caves and Mehra [I9861 study did not restrict their attention to entries of the larger corporations. Their results showed that the size of the entering firm is positively and significantly related to entry by acquisition over greenfield. Because acquisitions require generally more financial and managerial resources than joint ventures, size of the foreign firm’s assets should be positively correlated with the tendency to acquire. Conversely, acquisitions are discouraged, the larger the assets of the American partner, target firm, or investment size. (Kogut & Singh 1988) In 2008, this may or not be the same, as firms in certain industries may have grown and merged, while others may have decreased in size and split up into more specific companies. Also, the lending practices and investment practices are different today than they were 20 years ago, so a company may have more ways through which to acquire start-up capital necessary for operating in a foreign market. The article also examined why certain companies may enter a foreign market. Twenty years ago, not all countries possessed the technology, skills, or resources needed for some businesses. This caused companies to enter foreign markets to get what they were lacking in their own country. The previous empirical studies have assumed, however, foreign entry was usually for the purpose of market access or low cost manufacturing. Clearly, foreign entry into the United States may be motivated in order to source technology or purchase brand labels. The more diverse motives of investing in the American economy make it more difficult to sign the structural variables. For example, firms from R&D-intensive industries might joint venture if they possess the requisite technologies but lack the marketing depth. Or they may tend to acquire if they are investing for technology sourcing. Similarly, firms from marketing-intensive industries might engage in a joint venture if they possess the brand label but lack other resources along the value-added chain. Or they may acquire if they are investing for market penetration and lack label recognition. Stopford and Wells [1972] found that American firms pursuing an advertising-intensive strategy tend to full ownership of their overseas subsidiaries. Their data is drawn, however, from a time when American firms were investing overseas with clear strategic advantages. For our study, it is equally likely that foreign firms are investing in the United States for technology and brand label acquisition as for the exploitation of their proprietary assets. No prediction is made, therefore, on the signs of the coefficients for R&D and Advertising. (Kogut & Singh 1988). In 2008, as natural resources have been discovered in other parts of the world and new technologies have emerged, countries that were formerly primarily importers are not exporters, and countries that primarily exported, now import more from elsewhere. As the playing field changes every year, it’s important to note that countries will be continuing to search for the next best place or resource to help grow their company. Also, thanks to the internet and a computer-savvy generation, it is possible that some countries will not need outside help advertising or marketing, or with brand-name recognition. If the article were to be re-written today, obviously new data would need to be collected reflecting the changes of the last 20 years, including new industrial sectors, new companies, and more countries. The researchers would need to also differentiate between a few things. First, they would need to look at a specific industry, because, as they stated, the means of entry vary greatly depending on the industry. For example, one might enter a foreign banking market very different than had they entered a foreign market strictly to utilize their natural resources or labour force. Also, the article did not look enough at the cultural aspect of the business world. It would be remiss not to notice that there are some cultures who object to foreigners doing business in their country and would not respond to foreign business plans. For example, the United States and European nations might successfully acquire or start a business in China or Japan, yet not be as successful in a Middle Eastern Country. In conclusion, considering the article is over 20 years old, and the data was even older, the authors did a great job of analyzing data and investigating business trends and foreign market entry modes. It provides a great insight into the past and the mindset of the times, before new trade laws, instant communication, and most importantly, new products and services used by people worldwide. As societies change every day, as third world countries become first world, and new drugs are developed to cure a myriad of conditions, the only certainty is that 20 years from now, we will be in a very different business world as a result of our actions today. REFERENCES Caves, Richard. E. 1982. Multinational enterprise and economic analysis Cambridge, U. K. : Cambridge University Press. Dubin, Michael. 1975. Foreign acquisitions and the spread of the multinational fi. D. B. A. thesis, Jemison, D. B. & S. B. Sitkin. 1986. Corporate acquisitons: A process perspective, Academy of Management. Kogut, Bruce, and Harbir Singh. 1988. The Effect of National Culture on the Choice of Entry Mode. The Journal of International Business Studies k S. Mehra. 1986. Entry of foreign multinationals into U. S. manufacturing industries. In M. Porter, ed. , Competition in global industries. Boston: Harvard Business School. Sales, A. L. & P. H. Mirvis. 1984. When cultures collide: hues in acquisition. In Managing organizational Stepford, J. & L. Wells. 1972. Managing the multinational enterprise: Organization of the firm and ownership. New York: Basic Books.