In an era of increased levels of competition in all sectors of the economy, all businesses are executing approaches that are aimed at attracting and retaining customers. One of the strategies that many firms are adopting is the integration of new markets and production.
Business establishments that do not adopt unique ways of doing business are likely to be forced out of the market due to competition from business rivals. Successful businesses have always been innovative in their business approaches. Innovation implies that firms implement strategies that are unique and those that could be utilized to gain a competitive advantage.
In the case study of Mobily Company, it is apparent that the organization requires integration to gain into new markets, increase the number of customers and its products in the market. The firm specializes in providing a service known as “scholarship,” which mainly targets students on scholarships. It would be prudent for the top management of the business establishment to adopt both vertical and horizontal integration strategies to remain in the market.
Vertical market integration is a strategic move that is adopted by companies to gain entry into new markets for increased revenues. The management of Mobily Company should focus on investigating market opportunities about its unique service. The investigation would require thorough market research that would yield important market data. The management would make decisions about customer segments and markets based on such data.
About the service offered by the organization, it would be important to understand the customer segments that would present the best growth opportunities. For example, King Abdullah’s scholarship project targets students in about 30 countries across the world.
Thus, the strategic marketing team of the company should analyze the number of beneficiaries of the scholarship based on their countries of origin. The service should be more focused on countries with relatively high numbers of beneficiaries. There is growth potential because the number of scholarships for the project has more than doubled since it was started.
The management should also be advised to adopt a horizontal integration approach about its unique product. The strategy would help the firm to expand through increasing the number of solar-powered devices produced per unit time. The decision to use a horizontal expansion strategy would be based on the assumption that the demand for the devices would increase significantly in the future.
Thus, the firm would be required to produce a relatively high number of appliances to meet customer demand trends. Many companies have expanded their production using the approach. However, companies do not diversify their product lines. Mobily would also focus on increasing the usability and durability of the product to attract and retain more customers.
The firm would strategically locate its production facilities based on the availability of labor and ready market. For example, it would be prudent for the management to locate production facilities in countries that have relatively high numbers of scholarship beneficiaries. To adopt a horizontal expansion strategy, the firm would be required to conduct a market study to understand the market demand of its product.
In conclusion, Mobily offers a unique product that has the potential for growth in the future. For the company to expand, the management needs to adopt both vertical and horizontal integration strategies. A vertical integration plan would involve increasing market localities about the product. On the other hand, a horizontal integration plan would involve increasing the number of solar-powered products of the firm.