Marketing Analysis of ABC Learning

Questions: 1.Outline the evironmental factors that impacted on ABC.Did these factors have a positive or negative impact on the firm?2.Do you think that the success and ultimate failure of the company was an outcome of its environment, or was it an otcome of its own strategies and actions?3.If the company had been able to continue to raise money and pursue its growth throug an acquistion strategy,do you think it would have been successful in the long run?4. Do you agree with the company's strategy choices? what strategy wold yo have chosen? Answers: Introduction ABC learning is an Australian based child-care company that was founded by Eddie Groves and Le Neve, his wife in 1988. The company was publicly listed in 2001 with a market capitalization of $25 million and 43 child-care centers in Australia. Moreover, the company experienced tremendous within seven years with over 2000 child-care centers around the world and a market value of $4 billion. However, the company collapsed towards the end of 2008 supposedly due to its environmental and marketing strategies as this outlines. 1. The environmental that had an impact on the operations of ABC learning include government policies, social, and cultural changes, and economic factors. The government had been supportive of early children education through providing subsidies to child-care centers. The government has come up with many policies that support and encourage the existence and development of child-care centers. These policies include tax rebate scheme that covered 50 percent of the child-care expenses. In addition to this, the government came with a policy that encourage people to have many children, this contribute to the growth of the childcare industry. Nonetheless, social and cultural changes implies to the changing roles of women in the society. The current society encourage women to go to work and support their families thus the need for childcare centers. On the other hand, the economic development enjoyed in the 2001 to 2007 period contributed to the growth of childcare industry. From the succes s experienced in that period, it is evident that the environmental factors had positive effects on the firm. 2. From the case, it is evident that the environmental factors contributed a lot to the success of ABC Learner. However, it is important to note that without the strategies and action of the company the environmental factors would not have been effective or successful in any way. On the other hand, it is evident that the strategies and actions employed by the company led to the collapse of the company. According to Krstic and Becic, (2011) marketing strategy is an important factor for the growth of business. However, according to the case as cited by Ernst and Young auditors the strategies employed by the company did not make any profits because most of the resources are tangible (Gillespie, Jeannet, and Hennessey, 2007). Thus, it is evident that the marketing strategies of the company contributed significantly to the collapse of the company. 3. According to Slater, Hult, and Olson, (2010) for a company to develop and achieve a competitive advantage in the industry, it must develop an effective marketing strategy that can allow the company to maximize its profits. Thus, if the company had utilized an acquisition strategy, there was a chance of success because accusation could enable the company to raise more money and have total control of the corporation. Acquisition entails buying part or whole of a company and strengthening the company to realize its full potential (Calandro, 2011). 4. The strategy employed by the company has many irregularities because it adds to the cost of the company. This is because the strategy employed by the company brought many subsidiaries on board, which led to outsourcing and eventually additional cost to the corporation. Thus, acquisition strategy could be perfect for the company since its gives the company control over the corporation. Moreover, the acquisition allows the company to accumulate a lot of money before venturing into new markets. References Calandro, J. (2011). Strategic MA: insights from Buffett's MidAmerican acquisition. Strategy Leadership, 39(4), pp.41-48. Gillespie, K., Jeannet, J., and Hennessey, H. (2007). Global marketing. Boston: Houghton Mifflin Co. Krstic, I. and Becic, S. (2011). Implementation of marketing strategy: Factor of competitive advantage. Marketing, 42(2), pp.118-126. Slater, S., Hult, G. and Olson, E. (2010). Factors influencing the relative importance of marketing strategy creativity and marketing strategy implementation effectiveness. Industrial Marketing Management, 39(4), pp.551-559.