SodaStream Company: E-Marketing Strategy Essay

Memorandum

Non-alcoholic beverages industry has been enjoying impressive popularity among the general audience and seems to have been around for eternity. With brand names like Coca Cola and Pepsi, there seems to be quite little room for a new entrance into the global market. Nevertheless, the SodaStream Company is currently doing relatively well in the global environment.

The overall score that the company has made on the IFEM assessment makes 3.52. This is clearly a passable level of internal capacities for an organization of the SodaStream’s scale. A good understanding of the perks that international partnership has to offer and, therefore, the ability to put these advantages to proper use can be considered the key strength of the SodaStream Company. Moreover, the financial policy of the company is beyond impressive, especially when compared to the approaches adopted by Coca-Cola and Pepsi.

The EFEM score of the organization equals 3.52, as the assessment has shown. The results can be attributed to the fact that SodaStream has been incorporating an array of media tools into the design of its promotion campaigns. The key opportunity, which the organization faces in the global market, is becoming a corporate giant in the non-alcoholic beverage production industry, whereas the failure to beat the opponents and reach the top of the economic Olympus can be interpreted as the key threat.

Introduction and Overview

The SodaStream Company was founded in 1903 by Guy Gilbey and had been displaying a rather impressive performance ever since. Even though competing with Coca Cola and PepsiCo, the corporate giants on the industry have been very challenging, SodaStream managed to survive to see the day when the power of the two key rivals subsided.

Traditionally referred to as liquid refreshment beverages, the non-alcoholic beverage industry blooms in the United States. SodaStream, an Israel-based organization producing the beverage in question, has developed an efficient business model in order to retain its revenues, yet increasingly high competition rates may jeopardize its success.

The history of the non-alcoholic beverage industry is rather memorable, especially when viewing it from the perspective of the companies located in the United States. Coca Cola, Inc., along with PepsiCo, has been calling the shots in the specified area for quite long, which means that SodaStream is most likely to face tough competition in the specified area.

Despite the aforementioned difficulties, which the company is fighting at present, it can be assumed that SodaStream is currently in its Expansion stage of the company life cycle. Seeing that the organization is planning to expand in the U.K. market, it is reasonable to suggest that the period of growth is still ahead of it.

Mission, Goals and Current Strategies

At present, the provision of high-quality services to a wider range of customers can be considered the key mission of the organization. Consequently, further expansion into the global market can be viewed as the current goal of the organization. In addition, the company clearly aims at beating competitive rivals.

In order to attain the above-mentioned goals, SodaStream utilizes a range of strategies, the key ones involving active use of social media and modern media tools, so that the process of raising awareness concerning SodaStream and its services could occur at a faster pace.

IFEM

The overall score that the company has made on the IFEM assessment makes 3.52. This is clearly a passable level of internal capacities for an organization of the SodaStream’s scale. A good understanding of the perks that international partnership has to offer and, therefore, the ability to put these advantages to proper use can be considered the key strength of the SodaStream Company. Moreover, the financial policy of the company is beyond impressive, especially when compared to the approaches adopted by Coca-Cola and Pepsi.

Management

• The company’s determination to keep the revenue high, as well as a sensible approach towards human resource management, can be viewed as a major strength. The factor under analysis can be weighted as 0.11.
• The lack of regard for the staff that works for the company and the poor distribution of roles and responsibilities, which leads to people getting fired for making mistakes, is a major weakness of SodaStream. The factor should be weighted as 0.12.

Finance

• The change in the geographical mix triggered by the alteration of the company’s location should be interpreted as a minor weakness of the organization. The aforementioned factor should be valued at 0.08.
• A consistent rise in the stock price of the organization is a major strength of SodaStream, which shows that the company leaders have chosen the right approach towards marketing and promotion. The factor can be valued at 0.12.

Marketing and Service

• An increase of user awareness concerning the key environmental issues, as well as the overall course for environmentalism in its marketing campaign, is a major strength that will help the company beat the competitors. The factor can be valued at 12.00.
• Active use of digital marketing and the incorporation of YouTube services into the array of resources for attracting more clients is a minor strength of the organization. Seeing that the concept needs further elaboration and, perhaps, development, the factor is valued at 0.07.

Production and Operations

• Consistent research and development of the company’s brand products is a major strength that can be valued at 0.14.
• An elaborate structure of the company and the hierarchy within is a minor strength of the organization. It can be weighted as 0.09.

Human Resource Management

The lack of emphasis on the significance of the company’s employees is a major weakness of SodaStream. It is weighted at 0.04.

Research and Development

• The consistent search for new flavors and innovative approaches towards making soda is obviously a major strength of the organization, as it sets the company aside from not only its numerous clones but also corporate giants, such as Coca Cola and PepsiCo. The factor was valued at 0.15.
• The lack of funding for the company’s R&D department is a major weakness that should be valued at 0.4.

Other Relevant Internal factors

• Indirect distribution as a tool for market penetration is a minor strength of SodaStream that can be weighted at 0.8.
• The fact that the company takes the aspect of cultural diversity into account when planning its intervention into the global market is a major strength, which is valued as 0.11.

EFEM

The EFEM score of the organization equals to 3.52, as the assessment has shown. The results can be attributed to the fact that SodaStream has been incorporating an array of media tools into the design of its promotion campaigns. The key opportunity, which the organization faces in the global market, is becoming a corporate giant in the non-alcoholic beverage production industry, whereas the failure to beat the opponents and reach the top of the economic Olympus can be interpreted as the key threat.

Competition and Industry

• The existence of Coca Cola and PepsiCo makes SodaStream’s process of integration into the target market and the corresponding attraction of new customers extremely complicated, therefore, posing a major threat. The factor was valued at 0.12.
• The supposedly old-fashioned business models, which the company’s rivals run their enterprises according to, is a major opportunity for the company to showcase its benefits and to demonstrate its ability to adjust to the requirements of the global market. The factor in question was weighted at 0.13.

Economic

• The necessity to work on the marketing issue and search for new ways of promoting the product triggers impressive costs, which are clearly a major threat to the company’s financial sustainability. The factor was valued at 0.13.
• The adoption of the razor blade business model by other organizations, including the Green Mountain Coffee Roasters, is a major threat to the stability of SodaStream. The factor was weighted at 0.12.

Social & Cultural

• The fact that the organization is expanding into not only the states that its leaders have cultural ties with but also into Europe and Latin America, is a minor threat to the company’s stability, as it predisposes that the organization should be very careful in the choice of the symbols and messages used for promoting the product to the new demographics. The specified factor was weighted at 0.12.
• The lack of brand legend, which Coca Cola and PepsiCo have created over the years for their brands, can be viewed as a major threat to the success of SodaStream among the target audience. The factor in question was valued at 0.11.
• The fact that the company has been accused of breaking the basic human rights several times by the people involved in the Israeli–Palestinian conflict is clearly a great obstacle on the company’s way to global recognition and a major threat to its stability. The factor was weighted at 0.14.
• The company’s successful use of the controversies that surround its recent commercial is a minor opportunity for the firm to become popular among the target customers.

Demographic

• The cultural differences between the company staff and the new target demographics are a minor threat to the success that the promotion campaign of SodaStream is going to have in the designated states.
• Offering carbonators to the new demographics is a minor opportunity for the company as far as its growth in the global market is concerned.

Other Relevant External Factors

• The lack of information concerning the key processes within the target market, as well as the demand and supply rates, market saturation, etc., which occurred due to a comparatively humble experience that the organization has had in the specified area, is a minor threat to the company’s progress.
• Focusing on environmentalism, SodaStream helps establish a positive image of itself in the global society, which is a major opportunity for the company to attract new customers and enhance the loyalty of the ones that it already caters to.

Recommended Strategic Vision and Supporting Strategies

Vision

The integration into the global economy, which SodaStraight is attempting at accomplishing at present, is bound to shape its vision considerably. While previously, the organization used to strive for customer satisfaction in the global market, SodaStraight will have to incorporate the concept of diversity into its set of strategies for reaching customer satisfaction.

Therefore, the vision of the company will concern the improvement of the current services so that the drinks produced by SodaStraight should meet the requirements of the new target customers. In other words, the cultural specifics of each state that the organization is going to expand into must be taken into account.

Grand Strategies and Supporting Strategies

SodaStream has created a rather impressive financial strategy, which deserves to be developed further. However, as far as the allocation of the financial resources acquired in the process, the reconsideration of the R&D department funding must take place. Seeing that SodaStream puts its future at stake by working on the new brand, which will represent the company in the global market, it is highly desirable that the R&D department should receive enough funding.

Strategic Intent

The incorporation of phased distribution into the set of strategies, which the company has resorted to in order to integrate into the U.S. market, makes the company’s further progress plausible, yet still could use some improvements. First and most important, the stratification of the target customers into several groups must be carried out. Thus, it will become a possibility for the company to identify the ways off marketing the drink to each target group individually.

Next, stronger stress must be put on the technological advance of the organization, especially regarding its use of information technology. Once the corresponding tools for communicating with the target audience and marketing the product to the latter efficiently is designed, SodaStraight will be capable of becoming stable within the global economic environment.

Functional Areas Considerations

Functional area: Marketing

S – A wide array of products;

S – Understanding of the flaws of the previous strategy;

S – Incorporation of the razor blade model into the marketing approach;

W – Lack of understanding of the cultural specifics of the states that the product is delivered to;

W – Financing issues that need to be resolved prior to fund the advertisement campaign;

W – Copying of the razor blade model by other companies;

O – Becoming the beverage production leader in the designated areas;

O – Attracting more customers;

O – Surpassing the opponents;

T –.failing to carry out the market analysis properly;

T – Failure to deploy the razor blade model due to intellectual property theft and the use of the specified idea by another company (e.g., PepsiCo).

Action Plan/Considerations

In order to implement the changes that the company needs to undergo so that it could enter the global environment, the leadership approach must be changed greatly along with corporate values. It is necessary that the staff should develop personal and professional responsibility, therefore, promoting the quality of the products and services offered by the company.

Analyzing the cultural specifics of the target markets is the next obvious step that will contribute to enhancing the company’s influence. As soon as the specified stage is over, the design of the advertisement and marketing strategies, which will appeal to the target demographics, must be provided.

Metrics

In order to evaluate the progress of the company in a proper manner, one will have to design an elaborate tool, which will allow for measuring the progress made by the organization. The competitiveness of the company compared to the rates displayed y the key rivals can be used as one of the parameters for evaluating the progress.

In addition, the difference in the company’s stock prices should be analyzed in order to understand the implications of the change, which is to be made to the SodaStream. It could also be argued, though, that the alterations in the stock prices should be compared to the ones of 2013 when the SodaStream displayed the highest-grossing rates.

Finally, the comparison of the net profit margins of the organization on a specific time slot must be carried out; the indices of 2013 should be considered the key markers, as the 2013 operations returned the highest revenues in the company’s history.

Conclusions

The global non-alcoholic beverage market environment has been evolving under the dominance of the world’s renowned soda drinks producers, i.e., Coca Cola and PepsiCo, which blocked the way to new entries into the market.

However, despite certain flaws in its approach towards R&D funding, SodaStream is likely to beat the competitors and become legitimately successful in the specified market as long as the company focuses on developing its e-commerce strategy. Having designed a perfect tool for introducing its products to the target customers, SodaStream advertises its products via social media and with the help of e-marketing, which can be considered quite fitting in the epoch of information technology.