Thursday, February 13, 2014

Curveballs


Blink:
As a classically trained marketer, I value the discipline of conducting a formal S.W.O.T. analysis during the strategic planning process.  However, recently I am beginning to realize, due to our turbulent world, even when companies conduct their homework, they need to learn to deal with unexpected curveballs.

Read On:
For those readers not familiar with the marketing acronym S.W.O.T., it stands for Strengths, Weaknesses, Opportunities and Threats.  It is a marketing analysis most companies conduct on a regular basis during their annual strategic planning process or whenever they are embarking on a new business venture.  

Last month I read a friend’s blog post about Rémy Cointreau.  Despite all their thorough planning identifying the business potential of the Chinese spirits market which also included reformulating Rémy Martin cognac making it sweeter to accommodate Chinese taste preferences, they were thrown a major league curveball.  Chinese President Xi Jimping decided to crackdown on pervasive corruption.  His anti-corruption movement opposed extravagant perks like gifts and parties.  Rémy Martin cognac was the branded alcoholic beverage of choice among government officials and wealthy businessmen.  Consequently their sales and profits pummeled.  So did Rémy Cointreau’s S.W.O.T analysis.

Has your company experienced any curveballs lately?  

2 comments:

  1. SWOT is a good tool. When I work with my clients I have them develop specific plans to 1.) Leverage their Strengths; 2.) Eliminate their Weaknesses; 3.) Seize their Opportunities; 4.) Minimize the Threats. I am not sure how or if Remy Martin could have foreseen the effect of a government crackdown on expensive gifts and parties, affecting their sales. Giving expensive liqour is part of life, and not seen as corruption. I used to take bottles of Makers Mark, and Jim Beam to my friends in China, Japan, Singapore,and other parts of Asia. I could buy it cheaper in the states, and would take along in my suitcase when I traveled. Was never a bribe for favors. It was a courtesy to friends. There are or where lots of private clubs and karaoke bars where individuals had their bottles on a shelf with their name tag around the bottle. It was a status symbol for them to display their bottles and have a bartender pour expensive western liquor and champagne for friends. It was part of what they call "Guanxi"- making connections; networking, and meeting the friend of my friend, who helps open a door, etc. Remy will come back. BTW- Maker's Mark, Jim Beam, Johnny Walker Black, and a lot of others will see a dip in sales if Remy Martin has experienced one as a result of the government's program.

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  2. In the "era of disruption" where cycles are compressed and strategies usurped by the unexpected, SWOT seems like a relic from the past.

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