Dyson company pestel analysis

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Scenario

You are the global marketing vice president at Dyson. You have been asked to attend a meeting with James Dyson, the company's founder. Dyson's CEO and the head of Dyson's New Product Innovation department will also be in attendance.

"Thanks for meeting with me today," James says. "Market intelligence has shown that our major competitors—Hoover, Shark, and Bissell—are all developing new cordless vacuum cleaners with a longer battery life than what's currently available."

James Dyson looks to you: "I need you to participate in a new cross-functional product development team that will research the feasibility of creating a cordless vacuum cleaner that works for one hour on a single charge. We also need to know if there's even a market for this type of vacuum," he says.

"We envision that this new vacuum will be used primarily in the home, but keep in mind, we want to be able to adapt it easily and cheaply for light commercial use. One way of doing this is by using swappable battery packs."

"Have an actionable marketing plan ready for me in three weeks," James says.

You know that to give the CEO the most thorough report, you'll need to conduct an internal analysis of Dyson and an environmental scan for the new vacuum cleaner. You'll need to have a detailed plan for identifying marketing opportunities, and you'll need to research the home and commercial vacuum cleaner industry, market trends, and Dyson's major global competition.

Introduction

As you have read above, this project asks you to put together a marketing plan for your CEO. The marketing plan will be for a consumer product with the potential to expand into light commercial use. The product will have a new swappable battery with longer life than the competition.

1 Introduction to Marketing

One of the most important functional areas in business is marketing. Companies such as Google, Boeing, Airbus, Apple, McDonald's, and Toyota have a passion for understanding their consumers and satisfying consumer needs in "well-defined target markets" (Kotler & Armstrong, 2014, p. 4). Basically, marketing is a managerial and social function through which companies and consumers create and exchange value. Kotler and Armstrong define marketing as the "process by which companies create value for consumers and build strong consumer relationships in order to capture value from consumers in return" (p.5).

The marketing process involves the following five steps (Kotler & Armstrong, 2014, p. 5):

1. Understanding the marketplace and consumer needs and wants.

2. Designing a consumer-driven marketing strategy.

3. Constructing an integrated marketing program that delivers superior value.

4. Building profitable relationships and creating consumer satisfaction.

5. Capturing value from consumers to create profits and consumer equity.

There are five major consumer value themes (Kotler & Armstrong, 2014, p. XVI):

1. Creating value for the consumer in order to capture value from them in return.

2. Creating and managing strong local and global value-creating brands.

3. Capitalizing on new marketing technologies such as the Internet and social media (eMarketing).

4. Assessing and managing the return on marketing investment.

5. Sustainable global marketing.

Selecting a product (or a service) to develop is a serious process in which cross-functional teams contribute to researching, selecting, developing, and launching the new product. In addition, the company needs to evaluate the attractiveness of a new business. Sometimes a company will seek external help to develop a new product as the company may lack the necessary technical expertise, market knowledge, or resources. The company may also simply want to spread the financial risk involved i.e., strategic alliances.

To carry out this assignment, you need to understand consumers, how to acquire market knowledge (through primary and secondary research), and how to turn that knowledge into products that are needed and wanted by a group of consumers. You must also be able to invent market offerings that not only create value for the consumer but also create profitability for the organization. A company should strive to do all of this while being socially responsible and engaging in ethical behavior.

There are two types of market research: primary and secondary research. Both types of research are required, and each of them has its pros and cons.

There are differences between a product and a service. A product is more than just a physical good—it can be a service attached to a physical product, a "pure" service, an idea, a place, an organization, and even a person, such as a celebrity.

References

Kotler, P. & Armstrong, G. (2014). Marketing management (15th ed.). Upper Saddle River, NJ: Pearson.

2 Understand the Components of a Marketing Plan

You will need to develop a marketing plan, which is a written document that outlines the marketing program for the new Dyson vacuum cleaner. As part of your marketing plan, include the promotional budget allocation for the entire planning period. In other words, your marketing plan details what is needed to implement your marketing program and achieve its goals. Read about vision and mission statements, and then find Dyson's vision and mission statements online.

It is important to note that a marketing plan is not the same as a business plan. While the marketing plan is part of the business plan, business plans typically also include additional information on financial strategies, operations, risk management, and human resources.

To standardize this process, you will use this marketing plan template.

3 Conduct an Environmental Scan

Dyson relies on quantitative and qualitative information from its industry and from markets to make important decisions, including go/kill decisions for its new product developments (Cooper, 2011). Several tools are available to Dyson; these include the following:

· PESTEL analysis (sometimes called PEST analysis): A PESTEL analysis enables Dyson to identify, analyze, and monitor the political, economic, social, technology, legal (including regulatory), and environmental factors that may impact its operations (Frue, 2017).

· Porter’s five forces analysis: Porter's five forces analysis is a framework that helps Dyson understand the competitive forces at play in its industry, and how these forces may impact the way economic value is divided among its competitors in the industry (Porter, 2008).

· SWOT analysis: A SWOT analysis is a planning and brainstorming tool that helps Dyson evaluate its projects and formulate its business plans. SWOT stands for strengths, weaknesses, opportunities, and threats. Dyson uses this tool to identify and analyze its internal strengths and weaknesses, as well as its external opportunities and threats. The results of this analysis may help Dyson improve its business, or forecast how a new product will perform (Harmon, 2016).

Research the vacuum cleaner industry (home and commercial, domestic and international). Include the following items in your analysis: market trends, market opportunities, threats, and Dyson's major global competition.

Go to the UMUC Library>Research Guides and select the following two research guides: Business and Management and Marketing. Read these research guides. Find and print the articles that will help you complete your assignments. It is easier if you conduct a separate search for each section of your marketing plan. Also, use the industry/company databases, such as Moody's, to research the vacuum cleaner industry. Make sure that you have a solid mix of scholarly (peer-reviewed articles) and reliable nonscholarly sources (e.g., Reuters, Bloomberg, Money, Fortune, Forbes, or practitioner sources such as Harvard Business Review).

Milestone 1: Conduct the following three analyses for Dyson: PESTEL analysis, SWOT analysis, and Porter's five forces analysis. Present your results in a four-page report (excluding cover page, reference list, tables, graphs, and/or exhibits). Be sure to support your work with the required readings, scholarly sources, and reliable nonscholarly sources using UMUC's library search engine. You will combine the work you have completed in this milestone with the other milestones and submit all work together in the final step.

4 Conduct a Consumer Analysis

Now that the environmental scan has been completed, the new product development group needs to conduct an analysis of consumer buying behavior in this industry. Outline how the team would conduct this analysis, while considering both current and potential product users. Your analysis should address how you would determine the following:

· What needs are being met by the product purchase? What are the benefits to the consumers? Make sure that you differentiate between features and benefits; go beyond manifest motives and consider latent motives.

· Who is involved in the purchase process? Who are influencers, buyers, and users?

· Where are the products sold (distribution channel)?

· How often are the products purchased? Is there seasonality to sales?

Milestone 2: Present your results in a three-page report (net, excluding cover page, reference list, tables, graphs, and/or exhibits). Be sure to support your work with the required readings, scholarly sources, and reliable nonscholarly sources (such as Bloomberg, Yahoo! Finance, Money, Forbes, Fortune, and Harvard Business Review) using UMUC's library search engine. You will combine the work you have completed in this milestone with the other milestones and submit all work together in the final step.

5 Segmenting, Targeting, and Positioning (STP)

The first step in developing a marketing strategy involves segmenting, targeting and positioning (STP).

Segmentation is breaking down the market into homogenous groups; targeting is selecting the consumer groups on which you will focus your marketing efforts. The appropriate segmentation variable is dependent on the needs and wants of the consumers. These decisions require extensive marketing research on the consumers and are directly tied to your value proposition. Once the segmentation variables are determined and the target markets selected, you need to develop a positioning strategy. Positioning refers to the image of the product that you want the consumer to have relative to the competition.

Describe the market research you would conduct to analyze and segment the market for the new vacuum cleaner. Explain how you would select a target market or markets for the product offering. These can be domestic markets, international markets, or both. In addition, explain the process of positioning the new Dyson vacuum cleaner relative to the competition.

Milestone 3: Your research results should be presented in a three-page paper (excluding cover page, reference list, tables, graphs, and/or exhibits). Be sure to support your work with the required readings, scholarly sources, and reliable nonscholarly sources (such as Bloomberg, Yahoo! Finance, Money, Forbes, Fortune, and Harvard Business Review) using UMUC's library search engine. You will combine the work you have completed in this milestone with the other milestones and submit all work together in the final step.

6 Begin the New Product Development Process

Dyson's new product innovation process involves both incremental and radical innovation. Radicalness is the combination of the degree of differentness and newness. This includes innovations that are new to the world, the industry, or to Dyson. Most radical innovations are new to the world (e.g., digital photography), and are very different from existing processes and products. On the other hand, incremental innovations lie at the other end of the spectrum; they are not exceptional or particularly new, they may currently exist in the industry, and may involve minor tweaks, adjustments, or changes from existing products. A radical innovation may become an incremental innovation over time as its underlying technology becomes more common (Schilling, 2013).