Directions and Methods of Development

(Group No.5)

Presenters:
Sonam Loday (031823)
Sonam Tashi (031824)
Outline
• Market penetration, Product development, market
Directions development, Diversification, and TOWS matrix

• Internal development, Mergers and Acquisition,

Methods and Strategic alliances

• Suitability, Acceptability, and Feasibility

Success
Criteria
 Ansoft Matrix
Existing
PRODUCTS New

Market Penetration Product Development

Existing
MARKETS

Market Development Diversification

New
TOWS matrix
 TOWS ANALYSIS OF STARBUCKS
• Strengths
1. Has a strong brand presence, which is leading
as a global organization with more than 16000
retail stores in 48 countries
2. Starbucks has the competitive advantages of
providing innovative products more quickly in
the all of the same retail stores
• Weakness
1. Generates 85% of revenues from US, its domestic
markets, being known as an international brand, the
organization needs to obtain some revenues from
outside the markets
2. Starbucks relies more greatly on creating innovation
in beverages, at the time of economy slowdown it
will be risky for the company as to how long they
will be able to sustain
• Opportunities
1. Starbucks has a strong market share of about 40%,
this is beneficial for the company to expand ahead
globally specially as a coffee market.
• Threats
1. Star bucks must be careful of the emerging
competition especially in domestic , to maintaining
position is important.
2. the rise in diary prices can be threat
 strengths
S-O strategies
The major strength is global presence
Opportunities and its strong customer loyalty which
help to increase market share and
growth in coffee market
( S1, O1)
Threats S-T strategies
One of the major threats that
starbucks could face is against its
(External) competitors. For this purpose,
starbucks should innovate or
diversify its product to retain its
position
Example: frappucino light blended
coffee ( S2, T1)
weakness (Internal)
W-O strategies
As starbucks has large market share of
about 85% in the US market, they must
take advantages of their market
expansion to increase its market share
outside it domestic market (W1, O1)
W-T strategies
To avoid this threats such as rise in the
cost of diary products is to diversify its
products that do not include any diary
items
Examples: soft drinks
( W2, T2)
Methods of Strategy development

• Internal development
a.

• Mergers and acquisition

b.

• Strategic alliances
c.
Success Criteria

Acceptability

Feasibility
References
John, G., Scholes, K., and Whitington, R. (2008).
Exploring Corporate Strategy: Text and
Cases. India: Prentice Hall
Wheelen, L. T., and Hunger, D. J. (). Concepts in
Startegiec Management and Business Policy:
India: Pearson Prentice Hall
Thank You