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Madison Avenue Digital Media Services A Case Study Solution

Case Study Solution And Analysis


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Madison Avenue Digital Media Services A Case Study Analysis

Madison Avenue Digital Media Services A is currently one of the most significant food cycle worldwide. It was established by Kelloggs in 1866, a German Pharmacist who first launched "FarineLactee"; a combination of flour and milk to feed babies and reduce death rate. At the very same time, the Page bros from Switzerland also discovered The Anglo-Swiss Condensed Milk Company. The two ended up being rivals initially but in the future combined in 1905, resulting in the birth of Madison Avenue Digital Media Services A.
Business is now a multinational company. Unlike other multinational business, it has senior executives from various nations and tries to make decisions thinking about the entire world. Madison Avenue Digital Media Services A presently has more than 500 factories around the world and a network spread across 86 countries.

Purpose

The purpose of Madison Avenue Digital Media Services A Corporation is to boost the quality of life of individuals by playing its part and providing healthy food. It wants to help the world in shaping a healthy and better future for it. It also wants to motivate individuals to live a healthy life. While making certain that the business is succeeding in the long run, that's how it plays its part for a better and healthy future

Vision

Madison Avenue Digital Media Services A's vision is to provide its customers with food that is healthy, high in quality and safe to consume. Business visualizes to develop a well-trained workforce which would help the business to grow
.

Mission

Madison Avenue Digital Media Services A's mission is that as currently, it is the leading business in the food industry, it believes in 'Great Food, Excellent Life". Its mission is to provide its consumers with a range of choices that are healthy and best in taste. It is concentrated on offering the best food to its customers throughout the day and night.

Products.

Madison Avenue Digital Media Services A has a large range of products that it provides to its consumers. In 2011, Business was noted as the most rewarding company.

Goals and Objectives

• Remembering the vision and mission of the corporation, the business has set its goals and goals. These goals and goals are noted below.
• One goal of the company is to reach zero garbage dump status. It is pursuing absolutely no waste, where no waste of the factory is landfilled. It encourages its staff members to take the most out of the spin-offs. (Business, aboutus, 2017).
• Another objective of Madison Avenue Digital Media Services A is to lose minimum food throughout production. Frequently, the food produced is lost even prior to it reaches the customers.
• Another thing that Business is dealing with is to enhance its product packaging in such a method that it would help it to minimize the above-mentioned complications and would also guarantee the delivery of high quality of its items to its consumers.
• Meet worldwide standards of the environment.
• Construct a relationship based on trust with its consumers, company partners, employees, and government.

Critical Issues

Just Recently, Business Business is focusing more towards the strategy of NHW and investing more of its profits on the R&D technology. The nation is investing more on acquisitions and mergers to support its NHW method. The target of the business is not attained as the sales were expected to grow higher at the rate of 10% per year and the operating margins to increase by 20%, given in Exhibition H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The present Business technique is based on the principle of Nutritious, Health and Health (NHW). This technique deals with the idea to bringing modification in the consumer preferences about food and making the food stuff healthier worrying about the health issues.
The vision of this strategy is based on the key technique i.e. 60/40+ which merely suggests that the items will have a score of 60% on the basis of taste and 40% is based on its nutritional value. The items will be manufactured with additional nutritional value in contrast to all other products in market getting it a plus on its nutritional content.
This strategy was embraced to bring more tasty plus nutritious foods and beverages in market than ever. In competitors with other companies, with an objective of keeping its trust over customers as Business Business has actually acquired more trusted by clients.

Quantitative Analysis.

R&D Costs as a portion of sales are declining with increasing real amount of spending shows that the sales are increasing at a greater rate than its R&D costs, and allow the business to more invest in R&D.
Net Revenue Margin is increasing while R&D as a portion of sales is declining. This sign also reveals a green light to the R&D costs, mergers and acquisitions.
Financial obligation ratio of the company is increasing due to its spending on mergers, acquisitions and R&D advancement rather than payment of financial obligations. This increasing debt ratio pose a risk of default of Business to its financiers and could lead a declining share prices. In terms of increasing debt ratio, the company needs to not invest much on R&D and ought to pay its current financial obligations to decrease the danger for investors.
The increasing risk of investors with increasing financial obligation ratio and declining share rates can be observed by huge decrease of EPS of Madison Avenue Digital Media Services A stocks.
The sales development of company is likewise low as compare to its mergers and acquisitions due to slow perception structure of consumers. This slow growth also prevent business to additional spend on its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Keep in mind: All the above analysis is done on the basis of computations and Graphs given up the Displays D and E.

TWOS Analysis


TWOS analysis can be used to obtain different strategies based on the SWOT Analysis offered above. A brief summary of TWOS Analysis is given in Exhibit H.

Strategies to exploit Opportunities using Strengths

Business should introduce more innovative items by large amount of R&D Costs and mergers and acquisitions. It could increase the marketplace share of Business and increase the earnings margins for the business. It could also provide Business a long term competitive benefit over its rivals.
The international expansion of Business must be concentrated on market capturing of establishing nations by growth, attracting more clients through client's commitment. As developing countries are more populous than developed nations, it might increase the customer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisMadison Avenue Digital Media Services A must do careful acquisition and merger of companies, as it could impact the customer's and society's understandings about Business. It ought to obtain and merge with those companies which have a market track record of healthy and healthy business. It would enhance the understandings of customers about Business.
Business must not just invest its R&D on innovation, rather than it should also concentrate on the R&D costs over examination of cost of various nutritious products. This would increase cost efficiency of its items, which will result in increasing its sales, due to declining rates, and margins.

Strategies to use strengths to overcome threats

Business needs to move to not only developing but also to industrialized nations. It needs to broadens its geographical growth. This large geographical growth towards establishing and developed nations would minimize the danger of possible losses in times of instability in numerous countries. It needs to expand its circle to different countries like Unilever which runs in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

Madison Avenue Digital Media Services A should wisely control its acquisitions to prevent the danger of misunderstanding from the consumers about Business. It needs to get and merge with those nations having a goodwill of being a healthy company in the market. This would not just improve the perception of consumers about Business however would likewise increase the sales, earnings margins and market share of Business. It would likewise allow the company to utilize its possible resources efficiently on its other operations instead of acquisitions of those companies slowing the NHW strategy development.

Segmentation Analysis

Demographic Segmentation

The demographic division of Business is based upon four aspects; age, gender, earnings and profession. Business produces several items related to babies i.e. Cerelac, Nido, etc. and related to adults i.e. confectionary products. Madison Avenue Digital Media Services A products are rather budget friendly by practically all levels, however its major targeted customers, in regards to earnings level are middle and upper middle level consumers.

Geographical Segmentation

Geographical segmentation of Business is made up of its presence in practically 86 nations. Its geographical division is based upon 2 main factors i.e. average income level of the consumer in addition to the climate of the region. For instance, Singapore Business Business's division is done on the basis of the weather of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the personality and lifestyle of the client. Business 3 in 1 Coffee target those clients whose life style is quite busy and don't have much time.

Behavioral Segmentation

Madison Avenue Digital Media Services A behavioral segmentation is based upon the attitude understanding and awareness of the customer. Its highly nutritious products target those customers who have a health mindful attitude towards their usages.

Madison Avenue Digital Media Services A Alternatives

In order to sustain the brand in the market and keep the client intact with the brand name, there are 2 options:
Alternative: 1
The Business should spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase total possessions of the company, increasing the wealth of the company. Costs on R&D would be sunk expense.
2. The company can resell the obtained units in the market, if it fails to execute its technique. Amount spend on the R&D could not be restored, and it will be thought about totally sunk expense, if it do not offer potential results.
3. Investing in R&D provide sluggish development in sales, as it takes very long time to present an item. Acquisitions supply quick outcomes, as it supply the business already established product, which can be marketed soon after the acquisition.
Cons:
1. Acquisition of business's which do not fit with the company's values like Kraftz foods can lead the company to deal with misunderstanding of consumers about Business core worths of healthy and nutritious items.
2 Big costs on acquisitions than R&D would send a signal of business's ineffectiveness of developing innovative items, and would outcomes in customer's dissatisfaction.
3. Big acquisitions than R&D would extend the product line of the company by the products which are currently present in the market, making company unable to introduce new ingenious products.
Alternative: 2.
The Business should invest more on its R&D rather than acquisitions.
Pros:
1. It would allow the business to produce more innovative items.
2. It would offer the business a strong competitive position in the market.
3. It would allow the company to increase its targeted customers by presenting those products which can be used to an entirely brand-new market segment.
4. Ingenious products will offer long term benefits and high market share in long term.
Cons:
1. It would decrease the profit margins of the company.
2. In case of failure, the whole spending on R&D would be thought about as sunk cost, and would impact the business at large. The danger is not in the case of acquisitions.
3. It would not increase the wealth of company, which could provide a negative signal to the financiers, and could result I declining stock rates.
Alternative 3:
Continue its acquisitions and mergers with substantial costs on in R&D Program.
Vrio AnalysisPros:
1. It would allow the business to introduce brand-new innovative items with less risk of converting the spending on R&D into sunk cost.
2. It would supply a positive signal to the investors, as the general properties of the company would increase with its considerable R&D costs.
3. It would not impact the profit margins of the company at a big rate as compare to alternative 2.
4. It would offer the business a strong long term market position in regards to the business's total wealth in addition to in regards to innovative products.
Cons:
1. Risk of conversion of R&D spending into sunk expense, greater than option 1 lower than alternative 2.
2. Threat of mistaken belief about the acquisitions, higher than alternative 2 and lesser than option 1.
3. Introduction of less variety of innovative products than alternative 2 and high variety of innovative products than alternative 1.

Madison Avenue Digital Media Services A Conclusion

RecommendationsIt has institutionalized its techniques and culture to align itself with the market modifications and customer habits, which has actually eventually allowed it to sustain its market share. Business has developed substantial market share and brand identity in the city markets, it is advised that the business ought to focus on the rural areas in terms of developing brand loyalty, awareness, and equity, such can be done by developing a particular brand name allowance strategy through trade marketing methods, that draw clear difference between Madison Avenue Digital Media Services A items and other rival items.

Madison Avenue Digital Media Services A Exhibits

PESTEL Analysis
P
Political
E
Economic
S
Social
T
Technology
L
Legal
E
Environment
Governmental support

Altering requirements of global food.
Boosted market share.
Transforming perception in the direction of healthier items
Improvements in R&D and QA divisions.

Introduction of E-marketing.
No such effect as it is good.
Worries over recycling.

Use sources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Greatest given that 6000
Highest possible after Organisation with less growth than Company 3rd Most affordable
R&D Spending Highest given that 2001 Greatest after Service 3rd Least expensive
Net Profit Margin Greatest since 2002 with fast development from 2002 to 2012 As a result of sale of Alcon in 2015. Virtually equal to Kraft Foods Incorporation Practically equal to Unilever N/A
Competitive Advantage Food with Nourishment as well as health and wellness aspect Highest possible number of brand names with sustainable methods Largest confectionary as well as processed foods brand in the world Largest dairy items and also mineral water brand worldwide
Segmentation Center and also top center level consumers worldwide Private customers in addition to house team Every age as well as Revenue Consumer Teams Center and upper middle degree consumers worldwide
Number of Brands 7th 6th 9th 2nd

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 94934 129223 661119 319511 379896
Net Profit Margin 9.24% 1.33% 36.58% 6.51% 86.93%
EPS (Earning Per Share) 57.51 2.51 5.64 6.28 96.45
Total Asset 248263 614723 529531 383982 94586
Total Debt 49578 59439 96266 32722 73358
Debt Ratio 14% 22% 97% 25% 84%
R&D Spending 3933 9326 1758 8591 2248
R&D Spending as % of Sales 5.35% 5.46% 6.99% 3.35% 1.46%

Madison Avenue Digital Media Services A Executive Summary Madison Avenue Digital Media Services A Swot Analysis Madison Avenue Digital Media Services A Vrio Analysis Madison Avenue Digital Media Services A Pestel Analysis
Madison Avenue Digital Media Services A Porters Analysis Madison Avenue Digital Media Services A Recommendations