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Marketing Strategy for Otto Energy Limited
Posted by Addison on Mar-29-2023
The report primarily focuses on the marketing strategy of Otto Energy Limited to give a reader an overview of the growth dynamics of the company. Recently, several strategic issues and managerial problems have been identified in marketing strategy of Otto Energy Limited that have drawn the attention of the entire management to devise new marketing strategies that can help the company to resolve the problems to continue its expansion and future growth to achieve a competitive edge in the marketplace. This report is written to provide Otto Energy Limited marketing strategy with the required strategic solutions using multiple frameworks and tools.
External Environmental Analysis
PESTLE Analysis is the most popular strategic tool that is used by many organizations when conducting an external environmental analysis. This framework typically focuses on political, economic, social, technological, legal, and environmental factors that can impact the macro environment of the business (Zalengera, E.Blanchard, & C.Eames, 2014).
Otto Energy Limited operates in a politically stable environment, which means that it provides the company with more friendly and stable business growth opportunities (Christodoulou & Cullinane, 2019). However, since Otto Energy Limited operates in multiple countries, there are high chances of various political tensions that can cause instability in market growth trends for Otto Energy Limited. This can limit the company's growth opportunities.
Moreover, it is important for Otto Energy Limited to analyze and monitor the activities of pressure groups. Otto Energy Limited can create a close collaboration with these groups to achieve long-term goals.
Corruption and Changing Policies
Otto Energy Limited must keep a close check on the changes in any government policies because they can directly impact the performance of the business. The operations of Otto Energy Limited are its different countries can become unpredictable if there is a high level of corruption and weak enforcement of the law (Achinas, Horjus, & Achinas, 2019).
Trade and Taxes
The profitability of a company is directly influenced if there are high taxes in a country. Otto Energy Limited should look into the taxation policies in each country before further expanding its operations (Eierle, Hartlieb, & C. Hay, 2022). Similarly, if there are high trade restrictions, it can get difficult for Otto Energy Limited to import and export its products, impacting the relationships with trade partners.
GDP, Employment, and Exchange Rates
The long-term growth strategies of Otto Energy Limited are majorly determined by the GDP growth of the economy. The purchasing power of consumers significantly increases with a high GDP. High unemployment in an economy shows that Otto Energy Limited can benefit from surplus labor with low-cost wages. Furthermore, Otto Energy Limited should monitor interest rates as it can affect the borrowing ability. With that being said, if there is a high fluctuation in currency, the profitability of Otto Energy Limited can also be influenced (Sadeghi, 2020).
It is important for Otto Energy Limited to make appropriate predictions regarding the labor market conditions in a specific economy (Sadeghi, 2020). This can help the company to hire a more talented workforce that can improve the performance of the company.
Industry lifecycle stage
Otto Energy Limited should consider expanding its operations in growing economies to benefit from growth opportunities. It can be challenging for Otto Energy Limited to enter a mature industry at a growing stage (Villamarín & Pinzon, 2017).
Otto Energy Limited should study the changing patterns of demographics, such as socio-economic variables, the aging population, and trends in migration (Barbara & Cortis, 2017). This can help the company to identify the right segment to target with a high potential for growth opportunities.
Every country and society has a distinctive culture with different norms and values. It is important for Otto Energy Limited to study and identify social class stratification.
There has been a significant shift in online shopping. Otto Energy Limited needs to adopt necessary changes considering the growing use of social media networking sites and mobile phones to increase its revenue and overall profitability (Villamarín & Pinzon, 2017).
On-going technological innovations should be considered carefully by Otto Energy Limited so that it can stay ahead of the competitive market. Otto Energy Limited should continue working on introducing major technological transformations to achieve a competitive advantage (Rastogi & TRIVEDI, 2016).
Social Media Marketing
The collaboration with consumers has been growing rapidly because of the development of communication technologies (Rastogi & TRIVEDI, 2016). Otto Energy Limited can take it as a great opportunity where can use innovative strategies to expand its customer base.
Otto Energy Limited should implement the latest technological tools to minimize environmental pollution. Waste management is now getting popular and has been considered a major business norm (Igliński, Iglińska, & Cichosz, 2016).
Climatic Conditions and Eco-friendly products
Climatic conditions can influence the efficiency of Otto Energy Limited. The cost of a company's operations can be increased if there are extreme weather conditions. Similarly, there has been an increasing demand for eco-friendly products. Otto Energy Limited should work towards adopting more sustainable business practices to gain customer trust (Barkauskas, Barkauskienė, & Jasinskas, 2015).
Employee protection laws
It is important for Otto Energy Limited to follow the health and safety laws for its employees that are issued by the authorities to ensure the safety of its labor.
Otto Energy Limited should protect its customer data to ensure their security and privacy concerns. Moreover, it should set the right price with the right product quality (Igliński, Iglińska, & Cichosz, 2016).
Porter's Five Forces
Otto Energy Limited can use Porter's Five Forces to analyze the competitive landscape of the industry. The strategic planners of Otto Energy Limited can use this framework to make effective decisions.
Threat of New Entrants
Otto Energy Limited operates in an industry where it is difficult to achieve economies of scale, making it difficult for new entrants to enter the industry (Yunna & Yisheng, 2014). There is a strong product differentiation with high capital requirements. Moreover, it is difficult to establish a distribution network easily in this industry. Thus, Otto Energy Limited has a weak threat of new entrants.
Bargaining Power of Suppliers
There are more suppliers in the industry of Otto Energy Limited. This shows that there is less control over prices. Organizations like Otto Energy Limited can easily switch to other suppliers because of less differentiation in products. This makes the bargaining power of suppliers a weak force in Otto Energy Limited's industry (H. Th. Bruijl, 2018).
Bargaining Power of Buyers
The industry in which Otto Energy Limited operates has many suppliers as companies to buyers. This means that buyers have fewer options and do not have control over prices (H. Th. Bruijl, 2018). The high product differentiation shows that there are few alternative products for buyers, and there is a high switching cost. This makes the bargaining power of buyers a weak force in the industry.
Threat of Substitute Products and Services
Otto Energy Limited operates in an industry that offers very few substitutes to its customers. The substitutes that are available are expensive because of their high quality (Zhao, Zuo, & Wu, 2016). However, companies like Otto Energy Limited sell their products at a lower prices. This clearly shows that buyers may feel reluctant when switching to other substitutes.
Rivalry Among Existing Firms
Otto Energy Limited operates in a less competitive industry. The already established companies have a large market share, meaning that any move by the existing companies will be noticed. Moreover, Otto Energy Limited has to take several competitive actions to become a market leader, as the industry is likely to grow rapidly in the coming years (Aithal, 2020).
Otto Energy Limited can make use of SWOT analysis to effectively analyze the company's internal strengths, weaknesses, external opportunities, and threats.
Strong distribution network
Otto Energy Limited operates in various countries and has multiple outlets that help the company to deliver its products quickly to its customers. This shows that Otto Energy Limited has a strong distribution network (Benzaghta, Elwalda, & Mousa, 2021).
Otto Energy Limited has established itself as a strong financial company over the past few years. It has generated enough profits that can be used to finance any future expenditure (Basset & Mohamed, 2018).
Otto Energy Limited has adopted the latest and innovative technology in its business operations, which has allowed the company to reduce its production costs (Benzaghta, Elwalda, & Mousa, 2021).
Social media presence
Otto Energy Limited has been successful in establishing itself as a strong brand on social media platforms that, includes Facebook, Twitter, and Instagram. This increases customer engagement (Basset & Mohamed, 2018).
High rent costs
Otto Energy Limited has its manufacturing plants on rented properties. This increases the company's overall costs, and a significant portion of Otto Energy Limited's profits go into paying the rent (Comino & Ferretti, 2016).
Research and Development
Otto Energy Limited has not been able to conduct effective and in-depth market research regarding new markets and products (Comino & Ferretti, 2016). Customer trends are always evolving, and it is important for Otto Energy Limited to take immediate action in conducting its research.
There has been a centralized decision-making process in Otto Energy Limited. This means that employees have to consult their managers before taking any decision themselves. This slow down the decision-making process. and employees feel demotivated. Thus, impacting the operations of Otto Energy Limited (Comino & Ferretti, 2016).
Presence of Internet
Otto Energy Limited has a great opportunity of expanding its business by using the internet. Since there has been a growing trend in online shopping Otto Energy Limited can boost its sales by expanding its online stores (Yan, Xia, & X.H.Bao, 2015). Additionally, social media platforms can be updated constantly to engage customers with all the new products introduced by Otto Energy Limited.
Technology is constantly evolving, and Otto Energy Limited can benefit from it by implementing the technology in its various departments. Manufacturing process can be completed automated, which can eventually help Otto Energy Limited to reduce its costs (Taghavifard, Mahdiraji, & Alibakhshi, 2018).
The continuous increase in globalization has allowed Otto Energy Limited to expand its business operations across borders. It has the opportunity of entering new markets (Yan, Xia, & X.H.Bao, 2015).
Recently, many companies are entering the industry in which Otto Energy Limited operates. This means that there are chances of increased competition. This poses a threat to Otto Energy Limited as it has to put more effort into gaining market share (Taghavifard, Mahdiraji, & Alibakhshi, 2018).
Fluctuations in exchange rates
The exchange rates are highly subjected to fluctuations that negatively impact the sales of Otto Energy Limited. Otto Energy Limited needs to study the changing fluctuations to keep up with its profitability (Vlados & Chatzinikolaou, 2019).
The consumer trends are constantly changing, that causes changes in their demands. This puts pressure on companies like Otto Energy Limited, who have to continuously meet their consumer demands. Moreover, there is a significant threat from substitute products because consumers tend to switch to these companies (Vlados & Chatzinikolaou, 2019).
Otto Energy Limited operates in a wider range of products. Each of the products has its further product lines that are sold under the Otto Energy Limited. This means that customers can benefit from a large variety of products. Otto Energy Limited sells highly differentiated products with higher quality that, gives it a competitive edge (Khan, 2014).
Otto Energy Limited follows a competitive pricing strategy. The company also takes into account all its costs before setting its prices (Londhe, 2014). Currently, Otto Energy Limited is using a product bundle pricing strategy where customers get bundled products at lower prices.
Otto Energy Limited has adopted various distribution channels to reach its customers. The company sells its products through its website directly (Thabit & Raewf, 2018). Apart from this, it also distributes its products to wholesalers, who then further sell it to small retailers. Otto Energy Limited has its own retail stores where it sells its products directly to consumers.
Otto Energy Limited uses traditional and modern promotional techniques. TV ads are used to reach a larger audience. Otto Energy Limited also advertises on social media sites such as Facebook, Instagram, and Twitter. Events are sponsored by the company. Moreover, Otto Energy Limited participates in several exhibitions (Londhe, 2014).
Otto Energy Limited engages in corporate social responsibility activities. This has allowed the company to establish a strong brand image. Since, Otto Energy Limited has a well-established distribution network, the products are reached to consumers in a timely manner. Otto Energy Limited has been able to introduce innovation in its various departments, which has lowered its costs (Ariyani & Daryanto, 2018).
Otto Energy Limited operates in multiple countries. This means that its global presence is a rare factor. It works towards an organizational culture that encourages teamwork, and creativity among employees (Ariyani & Daryanto, 2018). Otto Energy Limited is also able to adapt to different societies, and cultures due to its exposure to various locations.
The products produced by Otto Energy Limited are of a high quality. Customers make repetitive purchases, and thus it is an inimitable source. (Miethlich & G. Oldenburg, 2019). Otto Energy Limited has a significant placement of its stores that gives an easy access to its customers. Additionally, the company has been using a competitive pricing strategy because it has been able to achieve economies of scale, thus lower production costs.
Otto Energy Limited, over the years, has successfully gained a financial strength. Otto Energy Limited can make use of these finances to invest in major acquisitions that give it more growth opportunities. The advancements in technology have allowed Otto Energy Limited to manage its operations more effectively. Distribution channels are another resource for Otto Energy Limited. The supply chain is very efficient, resulting in more revenue (Miethlich & G. Oldenburg, 2019).
Value Chain Analysis
Otto Energy Limited is involved in primary activities such as the production of goods and then selling them to the target audience.
Otto Energy Limited should ensure to have a strong relationship with its suppliers to avoid any inconvenience in receiving, storing, and distributing the product. This will help Otto Energy Limited to have a more effective transformation of a product (Ariwibowo & Saputro, 2021).
Operations involves manufacturing as well as services. Otto Energy Limited should conduct an in-depth analysis of its operational activities to remain ahead of its competitors (M.El-Sayed, W.Dickson, & O.El-Naggar, 2015). This will increase the productivity of the company, and more profits can be generated.
It is important for Otto Energy Limited to analyze, and optimize its outbound logistics so that it is able to achieve the long-term corporate goals. Managing outbound activities properly reduces the chance of late deliveries (M.El-Sayed, W.Dickson, & O.El-Naggar, 2015).
Marketing and Sales
Otto Energy Limited should use various marketing and sales techniques to differentiate its products from its competitors. Otto Energy Limited can adopt marketing and sales activities such as promotional activities, advertising, and building strong relationships with suppliers and customers (Ariwibowo & Saputro, 2021).
In terms of services, Otto Energy Limited must ensure that it provides its customers with the pre-sale and post-sale services (Jaligot, C.Wilson, & R.Cheeseman, 2016). The post-sale service typically falls into the promotional activities of a company. Otto Energy Limited can thus develop its customer loyalty.
A strong infrastructure of a firm can enable Otto Energy Limited to optimize the entire value chain of the company. Moreover, by controlling the infrastructure activities, Otto Energy Limited can be in a better position to get a strong foothold in the competitive marketplace (Darmawan & Wiguna, 2014).
Human Resource Management
Otto Energy Limited should place its major focus on analyzing the different aspects of HR, such as recruitment, selection, training, and performance evaluation of employees (Darmawan & Wiguna, 2014). Otto Energy Limited can reduce its costs by identifying and analyzing the costs associated with hiring and training.
Procurement is an important element in the Otto Energy Limited's value chain. It is important for the company to assess its overall procurement activities so that the inbound, outbound, and operational activities can be optimized (Kumar & P. V., 2016).
Otto Energy Limited can implement Ansoff's Matrix to make decisions regarding its business growth. This framework includes four different strategic choices that can be selected by Otto Energy Limited.
Otto Energy Limited can increase its overall production capacity. This will allow the company to reach more wider audience in an existing market. Otto Energy Limited can also benefit from the reduced costs by expanding its production capacity. Thus, Otto Energy Limited can attract more customers using competitive pricing (Madsen, 2017).
Otto Energy Limited can penetrate the market by investing more in marketing and sales activities. This will help the company to engage with its customer more effectively, leading to more potential customers (Dawes, 2020).
Innovative and unique distribution channels can be explored by Otto Energy Limited. This will enable the company to reach new segments and groups of customers (Dawes, 2020). In addition to this, Otto Energy Limited can penetrate the market by improving its supply chain, giving more accessibility to customers.
Otto Energy Limited can enter into joint ventures or can take over other leading companies of the market. This will give Otto Energy Limited more market share.
Research & Development
Otto Energy Limited should keep on investing in its R&D department, so it is able to identify the changing trends of the market. This will help Otto Energy Limited to target the right market at the right time (Mukangai & Murigi, 2021).
Otto Energy Limited can enter in a new market by expanding its operations regionally. This includes considering different cities of the country. Otto Energy Limited must consider any cultural differences when entering a new market (Mukangai & Murigi, 2021).
New segments of the current market can be explored (Mukangai & Murigi, 2021). Otto Energy Limited can add new features and product uses to its existing products that satisfies the needs of a different customer segment.
Otto Energy Limited can modify the existing product by improving its features to enhance the product offerings.
Launching additional products
Otto Energy Limited should invest in its R&D department so it can come up with new and innovative products that attracts and fulfill the needs of the target audience. This will boost the sales of Otto Energy Limited and will increase profitability (Khajezadeh, Niasar, & Asli, 2019).
Otto Energy Limited can consider vertical integration. This will allow Otto Energy Limited to develop and launch new products that are similar to its existing product category (Khajezadeh, Niasar, & Asli, 2019).
Otto Energy Limited can diversify its business operation using horizontal integration. This means that the new products and services of Otto Energy Limited will not be related to its current products (Dhir & Dhir, 2015).
A new business diversification
Entering into a completely new business can be considered by Otto Energy Limited. The organization can work towards starting a new business that can give a company more growth prospects in the future (Dhir & Dhir, 2015). Otto Energy Limited can conglomerate with the help of mergers and acquisitions.
To conclude, it could be said that Otto Energy Limited can resolve its current managerial and strategic problems by focusing on its existing products. The company can adopt more attractive marketing strategies that can help Otto Energy Limited to boost its revenue and profitability. It is recommended to focus on maintaining strong supplier relationships. Moreover, it is also advised to focus on more innovative products so Otto Energy Limited can remain competitive in the market.
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- PESTEL Analysis of Otto Energy Limited
- Hofstede Cultural Model of Otto Energy Limited
- Net Present Value (NPV) Analysis of Otto Energy Limited
- Marketing Mix (4Ps) Analysis of Otto Energy Limited
- Corporate Social Responsibility of Otto Energy Limited
- Otto Energy Limited Discounted Cash Flow (DCF) Analysis
- VRIO Analysis of Otto Energy Limited
- Blue Ocean Strategy of Otto Energy Limited
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