Str Essay Example | Topics and Well Written Essays - 2500 words

Str - Essay Example Trends in the alcohol market Because Pernod Ricard produces many branded products, it is necessary to focus only on the alcohol industry which makes up the majority of their business success and market share against competition. As the business extended into more foreign markets, as identified by the case study, Pernod Ricard required a new structure philosophy to ensure that the business could operate effectively and competitively against large-scale alcohol producers. This required a decentralisation strategy in order to create an environment where sub-units of the company were empowered to act as their own consultant businesses. Taking ownership of individual development with a cross-functional ability to inter-link independent, self-managed divisions was in response to labour-based trends for productivity and support as well as producing a world-class business capable of revenue growth. Heavier emphasis on branding as identified in the case leads to the logical conclusion that th is business relies on marketing and operations in response to consumer trends. A detailed PESTEL analysis identified key competitive or non-competitive activities at the social level that impact consumer buying perception about consumer products. Heineken, a brand operating in the adult liquor markets internationally, refocused its previous position on quality as a competitive tool and adopted new packaging concepts to gain consumer interest, such as the mini-keg bottling format (Beverage World 2009). Even though this is not a direct competitor, the beer brand experienced a 100 percent increase in sales whilst other companies that did not restructure packaging experienced only a dismal 1.7 percent increase in sales volume (Beverage World). This is driven by consumer sentiment and their current buying trends that makes advertising through innovation a success factor for alcoholic beverage producers. However, this is problematic for Pernod Ricard due to the high regulatory influence t hat exists in foreign and/or domestic markets regarding the responsible use of advertising that depicts alcoholic products. â€Å"The Group (PR) has signed several voluntary self-regulation codes, which impose restrictions on the advertising of and promotions for alcoholic beverages† (pernod-ricard.com, 2010, p.3). The business recognises not only the restrictions placed on advertising, a key success factor for many of today’s businesses in multi-national markets, and places an emphasis on voluntary corporate social responsibility. Similar CSR efforts as an adaptation to existing business strategy has been identified in Anheuser-Busch, a leading alcoholic beverage producer, that â€Å"takes its role seriously†¦(and) has long invested in the communities where (they) live and work† (anheuser-busch.com, 2007, p.3). The efforts undertaken by this non-competitive entity only reinforces that business must restructure and change their strategic focus in order to r emain in control and flexible to meet key trends that impact buying behaviour. Like any other business, it is often in a servant position due to economic trends that affect customer disposable income and their product preferences. The technological