ENVIRONMENT ANALYSIS MKT558 BATA\'S COMPANY PDF

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UNIVERSITI TEKNOLOGI MARA (UiTM) CAWANGAN MELAKA KAMPUS BANDARAYA SEMESTER 3 SESSION 2020/2021 MARCH 2021 – JULY 2021 MKT558 DIGITAL MARKETING

INDIVIDUAL ASSIGNMENT: ENVIRONMENT ANALYSIS

MADE BY: AISHAH NISA BINTI FAYROUZ (2020859636) CLASS: M1BA2423B GROUP: 3B MADE FOR: DR AZLIN ZANARIAH BAHTAR SUBMISSION DATE: 23rd April 2021

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ACKNOWLEDGEMENT

First and foremost, praises and thanks to the Almighty, for His showers and blessings throughout my assignment which is one of the requirements that need to be fulfil in the course work assessment for Digital Marketing subject. This assignment had been done with my countless effort. With all the commitments and responsibility, I guaranteed that this assignment had meet your requirements.

Besides that, I would like to express sincere appreciation to my beloved lecturer for this subject, Dr Azlin Zanariah Bahtar for her constant guidance and encouragement, without her, this work would not have been possible, and I am truly grateful for her unwavering support to ensure that I will produce a good quality assignment.

On the other hand, I would like to address big thanks to my beloved friend and classmates for their elevating inspiration and kind supervision in the completion of my assignment. They always provide me ideas and comments regarding the individual assignment so that I can improve my individual assignment in various ways.

Finally, I would like to mention here that I am grateful to each and everybody who has been associated with my individual assignment at any stage. I am very thankful to them for the effort and initiative that they have shown in order to successfully completed this individual assignment and I hope this assignment report can give more information and knowledge about digital marketing.

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TABLE OF CONTENTS

TITLE PAGE………………………………………………………………………………...i

ACKNOWLEDGEMENT…………………………………………………………………...ii

TABLE OF CONTENTS……………………………………………………………………iii

1.0 INTRODUCTION………………………………………………………………1 1.1 Background of the company……………………………………………...2

2.0 ONLINE CONSUMER VARIABLES…………………………………………3 2.1 Consumer Profile…………………………………………………………4

3.0 ANALYSIS OF MACRO-ENVIRONMENT…………………………………6 3.1 Political Impact…………………………………………………………..7 3.2 Economic Impact…………………………………………………...........7 3.3 Social Impact…………………………………………………………….8 3.4 Technological Impact……………………………………………………8 3.5 Legal Impact……………………………………………………………..9 3.6 Environmental Impact…………………………………………………...9

4.0 CONCLUSION………………………………………………………………...10

5.0 REFERENCES………………………………………………………………...11

6.0 APPENDICES…………………………………………………………………12

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1.0 INTRODUCTION What is environmental Analysis? Environmental Analysis is a mechanism that identifies both external and internal elements that could have an impact on the organization. The research entails assessing the extent of the threat or opportunity presented by the variables. These assessments are then factored into the decision-making process. The study assists in aligning policies with the firm's environment. SWOT analysis and PESTLE analysis are two examples of environmental analyses.

The primary goals of environmental analysis are to aid in understanding of the existing climate, to provide evidence for strategic decision-making, and to facilitate strategic linking in organizations. As we know, environmental analysis is not the same with environmental scanning. The primary distinction between environmental scanning and environmental analysis is that in scanning, the pros and cons of an operation are performed in a survey prior to implementation, while in analysis, the results and input are obtained after the activity has been completed. Environmental analysis entails many phases, including gathering required information, scanning, and searching for information, gathering information through spying, predicting conditions, analyzing the environment, and evaluating.

Furthermore, environmental analysis also has their own pros and cons. One of the benefits of doing thorough environmental analysis are it helps in achieving objectives where environmental analysis allows businesses to study their surroundings and develop plans that will result in the effective achievement of their goals. Besides that, environmental analysis also suffers from certain limitations such as lack of strategic approach. It is also causing a person to be too cautious in his approach, causing him to fall behind the events. As a result, this research should be performed strategically.

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1.1 Background of the company

Bata, also known as the Bata Shoe Organization, is a family-owned multinational Footwear and Fashion accessory corporation. The company was founded in 1894 by Mr. Thomas Bata, a wealthy entrepreneur who blew the wind of change in the footwear industry. Bata began in Zlin, Czechoslovakia, which is now known as the Czech Republic. Throughout its history, Bata has sold over 14 billion pairs of shoes and has been called the “Largest Shoe Retailer and Manufacturer” by Guinness World Records.

I have discovered a few significant landmarks in Thomas Bata's life as well as pivotal moments in the growth of the Bata shoe business where in 1895, the Bata siblings' company was in debt to the tune of over 8,000 Guldens and was on the verge of bankruptcy and in 1897, the production of canvas shoes commenced, bringing about success and prosperity to the company. Bata now has over 6 000, retail outlets and 100 000 local distributors and franchisees worldwide. As a result, the trademark 'Bata Logo' logo became the most recognized pictures in the world. With over 100 years in the shoe industry, Bata offers a diverse range of shoes from the middle to higher income segment, from toddlers to children, as well as ladies and men.

In an increasingly competitive and integrated marketplace, a retailer's ability to sell products over the internet is critical. Since January 2015, Bata’s website is the main destination for twenty Bata shoe domains. In addition, Bata's major international brands have now been approved and have active domains which will be easier for the company to make great shoes affordable to everyone. Maintaining high levels of customer service is critical if retailers want to win and keep their customers' loyalty. Bata, on the other hand, provides consumers with access to a wide variety of goods, often going beyond what customers can buy in their local store, and they also allow customers to return unsuitable products purchased online to the stores for an exchange or refund.

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2.0 ONLINE CONSUMER VARIABLES

Online shopping is a relatively new development in E-Business, and it is unquestionably the future of global shopping. Most businesses use online platforms to market their goods or services. Customers are now exposed to online advertisements for various brands because of the advancement of digital communication across the internet. Thus, businesses can easily identify their consumer’s shopping preferences and provides considerable visibility for both niche markets and established brands. Next, geographic variables, demographic variables, psychographic variables, and behavioral variables are the four main variables that can be used to segment the consumer market. If you want your business to be successful in the long run, you must first consider these four segments.

Figure 1 Online Customer Behavior

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2.1 Consumer Profile (Classification Variables)

Generally, it is vital for a business to create their consumer profiles of their ideal customers. These profiles categorize customers so that they can be grouped for marketing and advertisement purposes. A business can collect information about the customer from market research by conducting a consumer study, such as the consumer's preferences, the target market, and relevant demographics. As a result, this information will be used in market segmentation for subsequent market analysis measures. Basically, a business will identify their target customer based on several traits such as demographic, socioeconomic, product usage, psychographics, generation, geography, geodemographics, and benefits. This market segmentation can then be used to generate ads that is more effective for different groups of consumers.

In terms of demographic factors, age influences how businesses market their goods both online and offline. Market segmentation by age often entails diversifying pricing and color choices, as well as changing features to meet the anticipated needs and aspirations of each age group. As for Bata company, it is primarily catering to kids and teenagers over the age of 3 to 12 years old, with a few items available for school-aged children such as Bata school shoes. Next, under the gender segmentation, the database is divided into two which are men and women. Businesses can segment their markets by gender and create variants of their products aimed at a particular gender, or they can change their marketing campaigns to cater to the male or female segment. Based on Bata’s website, there is a new division which are Marie Claire and Weinbrenner where Marie Claire is for female customers to promote a new dress line while Weinbrenner promoted new style collections for men.

Furthermore, the categorization of consumers based on their income is known as income segmentation. Customers are classified into three categories based on their monthly or annual income such as high-income, low-income, and mid-income. When a business creates their pricing strategies for the products and commodities, companies will consider the income levels of their target markets especially when the company is planning to launch a product or promote a sale. For instance, Sandak by Bata developed inexpensive Sandals in order to attract consumers who could not afford their higher-end or more costly lines.

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Besides demographic factors, it is vital to know our consumers’ browsing patterns. This is because the tool analyses the user's browser data and categorizes the user, which is extremely helpful to the user, who now provides recommendations for appropriate content. It is also advantageous to the content developers who can now receive data about user habits which could further improve the navigability and profitability of the website. As for Bata shoe company, most of the customers will browse through website which is Bata.com, and it such a good way as the company's goal was to spend less money on offline marketing, but instead focus more on online marketing and the reasons why they need to shop online especially on Bata’s websites is because Bata offers cheaper price on websites compared to Bata’s physical store.

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3.0 ANALYSIS OF MACRO-ENVIRONMENT The Macro Environment Analysis initiates the traditional strategic planning period. It means that it considers the scale and function of entire, national, or even global economies and societies. The aim of the macro-environment analysis is to identify potential opportunities and threats that will affect the industry but are beyond the industry's control. Next, nature and physical forces, technical influences, social and cultural forces, and political and legal forces are the five major components of the macro-environment. To conduct macro-environment research, it is best to use reliable tools designed for this purpose, such as PESTLE analysis. Pestle analysis is essentially a tool for analyzing the major external factors influencing an organization, which include political, economic, sociological, technological, legal, and environmental factors.

Firms have no clear influence over these variables. Nonetheless, each factor has an impact on any and every market, regardless of industry. PEST analysis aids in understanding current external pressures on the sector, allowing the organization to work on evidence rather than assumptions. Aside from that, it mitigates risks and capitalize on opportunities to stay competitive. PEST and SWOT analysis are often used together to gain a deeper understanding of the market climate. The two structures, however, are distinct and relate to various levels of market study. PEST analysis looks at the larger picture and how it affects the overall industry, the economy, or a critical decision. PEST is ideally suited for market research and a more indepth examination of the business environment. SWOT analysis, on the other hand, focuses on the enterprise itself to determine its strengths, vulnerabilities, opportunities, and risks. SWOT analysis is often performed at the start of a new project or to test a product line.

Figure 2 PESTLE Analysis

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3.1 Political Impact

The extent to which a government controls the economy, or a particular sector is determined by political factors. A government, for example, may impose a new tax or obligation and will force the entire revenue-generating structures of organizations to shift. Political concerns include tax policies, monetary policies, trade tariffs, and other measures that a government may enact during the fiscal year and that could have a direct effect on the business environment. Furthermore, Bata offers full consumer security to all Bata’s consumer since the company has strong political ties with other countries. Tariffs on imported shoes dropped from 65 percent to 25 percent between 2000 and 2003, with more reductions expected by 2005. Because of corruption in customs, import duties were effectively reduced to 8% rather than 25%.

3.2 Economic Impact

This economic growth factors would have a direct effect on a company and have long-term implications. In other words, the market's competitive economic environment conditions affect all enterprises, whether domestic or foreign. Inflation, interest rates, foreign exchange rates, and global growth patterns, will all influence the market. As for Bata, the world's largest manufacturer of footwear, has its headquarters in Canada. This network consisted of 75 shoe factories spread across 95 countries. Pakistan Bata is a member of BIG East (Bata International Group), which includes some east countries, and BIG West, which includes some west countries. By the 1990s, it was exporting the shoes to many countries, mostly in Europe and the Middle East. In the year 2000, Bata exported 730 000 pairs of Rs sixty million. Manufacturing costs begin to increase, productivity falls, and defects occur because of continuous variance in product design.

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3.3 Social Impact

Social variables examine the market's social climate and assess determinants such as cultural patterns, demographics, population analytics, and so on. Besides that, these variables have a significant impact on how advertisers perceive consumers and what motivates them. In regional and global markets, social factors and cross-cultural communication are crucial, and the scope of research in this area will determine success. Furthermore, Bata, on the other hand, offers shoes for all ages, all levels of class from lower to upper, and for the whole family, but it falls short when it comes to daily fashion design and hence, causing consumers to switch to other brands. This also happened because there are not enough advertisements to entice consumers to buy from them.

3.4 Technological Impact

Technical influences are linked to technological advances that can have a positive or negative effect on the operations of the industry and market. It is regarded as a vital tool for improving processes and functions by organizations. Technological factors are an important component of PESTLE research since they are one of the external environment factors that have a direct effect on businesses. As for Bata, they are bringing a wide range of products to the market. Bata Pakistan, as a multinational corporation, has played an important role in Pakistan's economic growth. It has introduced advanced technology and business expertise to the city, creating approximately 10,000 direct and indirect jobs. To meet the needs of its valued customers, Bata Pakistan outsources its products on a national and international scale in addition to its own manufacturing capabilities.

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3.5 Legal Impact

External and internal elements are present in these variables. Some regulations have an impact on the business climate while certain policies are maintained by businesses for their own benefit. Legal theory considers all those perspectives and then develops methods considering these laws. For example, consider safety regulations and labor laws. As for Bata, in terms of export growth, the DFRC scheme's reduction of value addition norms from 33% to 25% would benefit exporters of leather products, including leather footwear. Furthermore, in order to help tanners, modernize their footwear manufacturing facilities, there is an available funding for them. Lastly, to offset the impact of rupee appreciation, which has resulted in credit tightening, there is a compromise rate of interest on export credits.

3.6 Environmental Impact

Environmental factors are variables that are related to the physical environment, such as the earth's atmosphere. Environmental factors may influence a wide range of important aspects of industry. Climate change, weather, emissions, and the availability of non-renewable goods are few examples of environmental factors that impact businesses. In the case of Bata, the manufacture of leather footwear produced hazardous liquid chemical waste, such as volatile solvents. These chemicals were held in drums in an above-ground storage facility that was open to the public. Thus, considering new legislation introduced in the 1980s indicating new procedures for properly storing and disposing of chemicals, it is critical for Bata Shoe company to update the storage facility. Since the storage drums were rusted, exposed, and leaking waste into the atmosphere, the Ministry of Environment discovered that the relatively new environmental standards were not being met.

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4.0 CONCLUSION In conclusion, Digital Marketing has taught me a lot of new knowledge and information about a business in digital platforms which includes online marketing, websites and so on. In this task, I managed to choose one company which is Bata Shoe Company where I need to do an environmental analysis towards this company. This assignment has showed that online website can be the best effective platform for businesses to market their product. As for Bata Company they prefer their consumers to shop on their websites because they can reduce spending on offline marketing which are more costly. Thus, online marketing, especially website marketing, is the best medium because a brand can get to know their future customers better. As to prove this, during ‘Hari Raya’, Bata Company achieved a 90% engagement rate, which increased the brand recognition and foot traffic. Not just that, since this Pandemic Covid19 outbreak, the webstore performed admirably when Bata’s Shoe Company introduced a Stay Home Shop Safe campaign where a customer will get free delivery with no minimum spend as well as a 30% discount. As a result, webstore sales, conversion rate and return on ad spend increased.

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5.0 REFERENCES Wright, L. T. (2018). Online shopping: Factors that affect consumer purchasing behaviour. Cogent Business & Management. https://www.tandfonline.com/doi/full/10.1080/23311975.2018.1535751

Chen, Y., Fay, S., & Wang, Q. (2011). The Role of Marketing in Social Media: How Online Consumer Reviews Evolve. Journal of Interactive Marketing, 25(2), 85–94. https://doi.org/10.1016/j.intmar.2011.01.003

Bush, T. (2020, September 13). What Is Macro Environment? 2 New Examples You Can’t Miss. PESTLE Analysis; PESTLE Analysis. htt...