Case Study Johnson Johnson Marketing Essay

Case Study Johnson Johnson grocery store placeing EssayJohnson Johnson Consumer harvest-times contri more everywhereion is one of the leading fast moving consumer goods manufacturers in India. It is in like manner among the rough consistent and winning enterprises not just in the JJ world-wide group of companies, but also in India. Johnson Johnson Consumer Products division has been souring steadily over the conk declination out few historic period, and is one of the few companies in the Indian securities industry to grow at extremely healthy levels. Johnson and magicson is the world nigh comprehensive and gener each(prenominal)y based manufacturer of health circumspection ingathering and service for the consumer pharmaceutic and medical and nosology trade. The Consumer Products Division owes its success to the strength of its inciters, and the loyalty they screw from consumers, a material sense of set driven from the Credo, and an surroundings, which se ts the toughest standards of leadership.OverviewJohnson and johnson founded in 1886 as a supplier of health c atomic number 18 out emersion in open(a) securities industry place.The head quatered of John son and john son in radical(a) B accordswick ,NjThe bon ton sell more than 175 fruit in 57 countries in the world .In 2003 the sale of Johnson and johnson were 4.19billion dollar.John son and john son pay off 110,600 employers over the world .More than US280billion pa philonthrapy. field leading heath c ar supplierPRODUCTS OF JOHNSON JOHNSONAveeno ageless vitalityAveeno ingest + hair collectionAveeno nourish + style collectionAveeno hydrarting body disinfectJohnson indispensable baby lotionJohnson natural baby shampooJohnson natural head to toe foaming body washListerine total c beNeosprine lip healthNeutrogena men sensitive skinNeutrogena sore love bite gelNeutrogena skin clearing mineral powderNeutrogena advanced sun block lotionRoc brilliance day rejuvenatingRoc brilliance eye beautifier strip down crystal all natural sweetnerCOMPETETORS OF JOHNSON JOHNSONABBOTT LABSLILLY ELI CONOVARTIS A G revenue stamp ANALYSISPOLITICAL LEGALJohnson Johnson operates in both positive and maturation countries worldwide where the political situation in these countries is stable and elevates more Investments. too legislations in these countries favours free trade economy with no government intervention.stintingWith the introduction of the atomic number 63an Union and single currency the whole European commercialise has been trans get toed to a single commercialize hence increase the mart for Johnson Johnson point of intersections.Also inflation and exchange rates in most of the countries has been stable hence not pushing the prices of reapings or all rising Investments.SOCIOLOGICAL overdue to recent developments people around the world form changed from apply natural nutrition point of intersections to the put on of genetic modified fo od products or to special types of foUnilever has tried to cope with all the changes that government issue rank in the modern world.TECHNOLOGICALThe objective of Johnson Johnson is not save to maximize the wealth of its owners but also to carry the aspirations of its customers and to respond creatively and combatively with mark products and services that raise the quantity of life.Johnson Johnson put practically emphasis on research and development, modern technologies and launching of modified products so as action its stakeholdersSWOT ANALYSIS Johnson JohnsonStrengthsWorldwide sales have grown 14% indicating a strong stick for the global group.The hassle model adapted by Johnson and Johnson fundamentally uses the adaptation of entrepreneurial evaluates in show to retain an edge indoors the market place. running(a) with intensive scientific notions Johnson and Johnson utilise a varied expanse of problem solving techniques in order to challenge the standard practice and render on process finished emerging markets which enables associated development.The use of independent offices workings as standalone building blocks provides the luck to develop concepts with cultural considerations which faeces prove of the essence(predicate) when taking a product to global markets.WeaknessesThere is change magnitude ram within pharmaceutical markets to reduce prices in line with medical budgets and suffer patent expirations to ensure generic programmes argon updated within critical cart track movements.Challenges have been faced within Johnson and Johnson where a reduction in the market demand for key products has been identified some of these products were branded and have been replaced by generic programmes at the end of patent time lines.Internal flunk across the industry and not isolated to Johnson and Johnson would be the level of stealing and counterfeiting of drugs managed through internal personnel.OpportunityWhilst the recent acquisit ion of Pfizer Consumer Health supervise result act as an opportunity in its own right to supercharge growth for the brass section through alternative routes there is the added tax upper-case letterised through the return on investment which rejoin be realised 12 months before plan releasing funds back into the bottom line.Johnson and Johnson have utmostlighted revolutionary developments in pharma products with v undergoing regulatory review which provides the opportunity to grow the existing product portfolio.Development into invigorated functions of medical devices and diagnostics leave provide rude(a) markets to entry which will result in vocation growth.With the development of WTO rules to prevent the availability of cheap generic drugs there is the opportunity to reduce the level of lost profit due to generic introduction as patents run out. Whilst this will aid Johnson and Johnson where they own the brand where they atomic number 18 looking to jacket crownise on introducing generic drugs to market this opinion will aim a hindrance. flagellumsGenerally within the main pharmaceutical companies there is a soaring level of competition for the generics markets where patents finish and it is the counterbalance to entry where success will generally be de confinesined.Technological developments with bio-tech concepts will potentially move the traditional pharmaceutical methods out of the market place in the long term although there is an economical argument that this form of development can be segregated to run alongside traditional methods and complement as opposed to replace.FINANCIAL ANALYSISThe assessment of the monetary postal service of the firm constitutes an important aspect of the internal analysis which must(prenominal)iness be carried out to determine the strengths and weaknesses of the organisation .It is important to carry out a monetary consummation of the corporation Johnson Johnson. because the financial appraisal will indicate the extent to which the firm is fancying some of its key objectives and also help management to direct operations and crystalize decisions in ship canal which will achieve or fulfil the overall corporation objectives.deuce categories of financial performance measures are commonly apply and these can be based on absolute values, which measure profitability and those based on relative form of return on investment or capital employed. lucrativenessBusinesses come into being with the primary purpose of creating wealth for their owners. Profitability measures indicate how pitchively the total firm is being managed and in many an(prenominal) ways constitute the most important aspect. Profit is widely used as an absolute measure of profitability and provides a means by which a corporation can be compared with another in the selfsame(prenominal) industry e.g. Novartis or the same play along over disparate quantify of period.Net profit marginThis ratio relates the net prof it of the strain to the sales handd for the sales period. Net profit represents the difference between sales, the comprise of sales and the operating expenses used to generate that profit.Year ofOperation20022001200019991998 gross sales48,27051,51447,58240,97740,437Net Profit2,1291,8381,1052,7712,944Net ProfitMargin in %4.43.62.36.87.3We can see the profit ratio was up in early years but due to intensive competition and stark naked product innovations it started falling. crying(a) ProfitYear ofOperation20022001200019991998Sales48,27051,51447,58240,97740,437 sodding(a) Profit5,0415,1743,1814,3034,410Gross ProfitMargin in %10.41071011The gross profit margin indicates that the gross profit is stable over the cardinal years under consideration at 10% at the most is a favourable trend.LiquidityIn analysing the runniness position we want to know whether Johnson Johnson is able to meet its short-term obligations as and when they fall due.Year ofOperation20022001200019991998Current A ssets16,20917,67820,08625,40721,601Current Liabilities20,60223,21228,36412,13417,970Liquidity Ratio111.1112121From the abandoned figures we can see that Johnson Johnson have a sound liquidity position of 11 meaning the corporation is able to meet its short-term obligations from its authentic assets without having to raise finance by borrowing, issuing shares or selling fixed assets which is a favourable trend.20022001200019991998Price Earning Ratio21%21%11%31%41%The price-earning ratio is generally good at 31 it shows that the corporation is held in high esteem in the market20022001200019991998Dividend top24411838132029723088The divided cover compares the amount of profit earned per ordinary share, which is 2441 in 2002, is good compared to the previous years.20022001200019991998Efficiency21.741.632.653.30The company is being operated expeditiously in order to generate sales.Finally Johnson Johnson is financially sound and a going concern that is able to take up any challenges. plentyValue and suffering prices as hallmark of developmentMission statementFor best tint and best price.COMPETITOR PROFILE ANALYSISThe five forces analysis will aim to tell the key forces, which will affect the level of competition in food, home and personal care where Johnson Johnson operates.The five forces FrameworkPotential entrantsThreat ofEntrants (Low)SuppliersBargainingPower (Low)Competitive contestation (High)NorvatisNestleKraft FoodDanoneSainsburytag SpenserBuyersBargainingPower (low)Threat ofSubstitutes (High)SubstitutesThreat from new entrants (Low)Home and personal care requires high capital investment in order to enter market and Johnson Johnson have build up experience and distribution channels to compete effectively in the industry. Currently Johnson Johnson is operating in 100 countries and is able to tailor its products to the different markets and anticipate customers demand.Most of its products like Baby care products are market leaders.Threat of Subst itutes (high)There are so many competitors in consumer goods industry. there is a great competition among these consumers. So there is a substation effect which is very high.Bargaining power of Suppliers (low)Johnson Johnson is a very big and strong business entity, which cannot be considerably influenced or forced in its decisions by suppliers, as it is not dependent on one supplier. As declared in the case Johnson Johnson has no problem with supply of raw materials as is able to operate in 100 markets with a variety of products without run short of raw materials.Bargaining power of Buyers. (High)Customers especially in European market frequently limit on demanding more new products, develop features and great variety at acceptable prices. This has forced Johnson Johnson to develop new products.there are so many competitors prevailing in the consumer goods industry. So the dicker power of buyers is very high.Competition (High)Johnson Johnson main competitors are unilever PG etc. Due to this Johnson Johnson was under restructuring programmeCompetitors are producing the same products as Johnson Johnson, hence transmit competition in the market.ANALYSIS OF THE market MIX OF JOHNSON JOHNSONWeldon was a hold of merchandise, which was then to the advantage of the monolith JJ. The following discussions will analyze the capability of JJ using the merchandising flick to maximize the profits gained by the said company under the headship of Weldon. II. merchandiseing PointsA. ProductBased on the article of (2003) Johnson Johnson was a company who dwell in innovation and new products. This shows that the company has a commercial advantage against its competitors. Not only does it have a perceptible brand, it also offers products which the public identify with them. This is possible because they have identified themselves with the product. A good example of this would be their treatment of the drug, Procrit. B. PlaceAlong with the notable products of th e company, it also shows how effectively they make these accessible to the public. In the case of their product Band aid, they muged hospitals by making it more scientific through the improvements make by their research and design department. The product was made liquid and thus accessible for hospitals as wound closing agents. Another product was also made accessible to the public. Their product, Nizoral, was formerly an antifungal treatment targeted for hospital use was transformed to commonplace merchandise, shampoo. This shows the tenacity of the company to offer the public their products and in the same time expand their market. C. PromotionThe promotion of the products of JJ, the company takes on the persuasive craftsmanship of Weldon to the public. The article indicates that Weldon does impose rather challenging tasks to his executives. These tasks are expected to be successful at the first attempt that some of the executives even consider it impossible. Nevertheless, the pr essure provided by Weldon has been considerably effective given the performance of JJ in his reign. The competitive compulsion that has enveloped the company through Weldon has helped meliorate consciousness and creates a positive image towards the products offered by the company.D. Price ahead of time on in the article, the discussions have presented that JJ have offered the public with low-cost and considerably affordable products in the market. This doesnt only make their product known to the legal age of the public, but also the choice of many buyers. The good thing about JJs recognizable brand learn is that the buying public tends to trust their products. In this manner, this part of the marketing amalgamate tends to contribute largely to the rest of the determinants of product choice. Johnson Johnson as one of the most influential companies in the commercial sector. nonpareil could learn largely on the situations of JJ. It shows that a firm leader could do wonders for th e company. Weldon was cognizant of both internal and external elements that affect the overall environment of the company. In this manner, he was able to use these to his advantage. Knowing what deals to be done for product has greatly influenced how he became aware on how these are going to be carried out. More important than the effective implementation of the marketing mix, the proper communication within the brass instrument is required. Along with the strong leader, the need of a healthy interaction within the ranks presents not only an opportunity to develop but also, as seen in the case of JJ, to essentially make seemingly impossibly demanding tasks into measured ones.BCG MatrixThe Boston Consultative conclave BCG Matrix is a Portfolio strategic analysis tool. It evaluates the portfolio of strategic business unit or markets according to their performance and groups them as Stars, Cash Cows, Question Marks or Dogs. The matrix is a market share market growth matrix.Companie s must develop new businesses but also must cautiously prune, harvest or divest tired old businesses in order to release resources and reduce cost. In the case of Johnson Johnson, we are going to crumple the portfolio of the business based on BCG matrix, examine the relationship between market share and market growth of the different business units.BCG MATRIX FOR PRODUCTS grocery store SharegrowthHighlowHighStarsBest foodsFrozenMarket suppurationQuestion MarksDeodorantsAnti- PrespirantCash cowsKnorrFloraDogs cut down FastSTARS (High market share, high market growth)As we have seen in the question mark businesses, there are brands within the business units that are performing well and if the question attach are successful they become stars.In home and personal care, products for cleansing, deodorant and antiperspirant under the brands of Axe sixty Ponds, Rexona, CIF, comfort, Domesto, Omo, Skip and Snuggle have a good share of the emergence market. However, Johnson Johnson whi tethorn have to spend substantial funds for its stars to keep up with high market growth and fight off the competitors overtures as a leader in these core brands.CASH COWS (Low market share, high market growth)Johnson Johnson does not have to invest heavily on marketing or to finance capacity elaboration, as the growth is low and market conditions more stable. As these business units are market leaders, they enjoy economies of cuticle and higher profit margin. Johnson Johnson should use these cash cow businesses to support the dawdle ones that drive down the profit of the company.QUESTION MARKS (High market share, low market growth)Question MarksAccording to our matrix question marks are operating in a growing market without high market share. Johnson Johnson is categorized as question marks.Therefore it can be noticed that not the whole divisions are under performing, as a result Johnson Johnson call for to invest more in these business units to keep up with the fast growin g market because they are already successful but need better performance.DOGS (Low market share, low market growth).With a weak market share in low growth market, they may be considered as dogs. As consumers started questioning the effectiveness of products and turning to alternatives. varianceMarket segmentation is the process of taking a heterogeneous market and breaking it into smaller homogenous groups where all members have similar needs and respond similarly to a set of marketing efforts. Once the market has been segmented, the organization selects the segments to be served (known as target markets).Targeting.Johnson Johnson target households for home care products, health care products, personal care products for the people who are hygienics concious. Prices are generally set for middle class people, who can easily afford it.PositioningDetermine fix. A market position is developed for the product so that the target will clearly know where the product stands in relation to the competition, as well as other products marketed by the organization.Johnson Johnson have positioned themselves as home and personal care producers.Product positioning is how a product is positioned in the mind of the consumer. Positioning begins with finding a difference in the product that is worth establishing to the extent that it is important, straightforwardive, superior, communicable, pre-emptive, affordable, and profitable.Johnson Johnson have position their products-High Quality and good priceJohnson Johnson products are positioned as good value products but are slowing threat faced by Johnson Johnson derivative advantage refers to any feature of a product or organization perceived by customers to be desirable and different from the competition. An organization uses its resources and capitalizes on them to obtain a differential advantage by fling unusual products.CRITICAL SUCCESS FACTORSCritical Success Factors are factors upon which the success of the business is dependant. Johnson Johnson attend to these factors to ensure success.Ability to tailor products according to different market and anticipate customer demandsUnderstanding in depth of the countries in which Johnson Johnson operates form _or_ system of government of listening to customers.Producing different clasp of products to match the diversity of its consumersIncreased advert budget and interaction with advertising agencies.CORPORATE OBJECTIVESYet one of Johnson Johnson s major and most important objective was anticipating the aspirations of consumers and customers and responding creatively and competitively with branded products and services which raise the quality of life In crease customisation to local anesthetic national taste by establishing additional brand names.Regain Market Leadership with 5 years.Regain Stockholder confidenceInternationalise anxietyMarketing Mission StatementTo provide the best quality products and usefulness to the customer and be the market l eaders in the retail industry.MARKETING OBJECTIVESJohnson Johnson, consumer goods manufacturer has these main marketing objectivesTo create sustainable, profitable growth and value for shareholders and employees by improving profits by 10%.To improve performance of the lagging businessesTo boost sales and margin through its path to growth system by 10%To increase market share and honour leadership of its core brands by creating customer loyalty.To tailor products to different markets and anticipate consumer demand through research and development-innovation.OTHER MARKETING STRATEGIESGROWTH STRATEGIESGrowth Vector AnalysisExisting ProductImproved product (new, changed) sore ProductOptionsExisting marketMarket PenetrationProduct variants or product differentiationProduct line extensionMarket expansionMarket segmentationMarket-Product segmentation-New product development-Market development-Existing sharpnessNew MarketMarket developmentDiversificationConglomerate variegationAlternat ivesThe most suitable strategies of meeting the Marketing objectives stated above areMarket PenetrationA market penetration strategy suggests that growth is possible by achieving a deeper penetration (sell more) of its present product within a present market. An organization could sell more of its current product(s) to its current customers, attract competitors customers, or convince non-users to begin using the product, thereby increasing its existing market share. Another growth alternative is to try and identify new markets for its present products.Johnson Johnson should sell more of the existing Products in Asia, Europe and North America.Product Line ExtensionThrough a product line extension strategy, an organization might create an augmented product in order to stimulate the current markets and create new ones.Unilever must quickly start pursuing this strategy as its current products are falling out of favour with the consumer and should fall out this further.Market Developme ntBy employing a market development strategy, an organization might identify new markets for its product by determining potential user groups for its current products, seeking additional distribution channels in its present locations, or offering its product for sale in new geographic locations, either domesticated or international. Another alternative is to develop new products for an existing target market.Ford has the opportunity to develop a very profitable market in Africa and the pacific region in particular the former land countries that readily identify with anything British..New Product Development New Product development in existing Boundaries. Entirely new products can be developed taking into consideration customer tastes and preferences. This will enhance competitive advantage and keep competition at bay.Johnson Johnson must use a combination of these strategies to achieve best result in market growth and be able to compete effectively in the industry.COMPETITIVE ST RATEGIES concentrate DifferentiationThis occurs when the company a range of clearly differentiated products which spell to different segments of the market. This will be the most suitable strategy to pursue due to the companies reputation of quality, value and service. It will also be congruous with the core aspirations of the company.Cost Leadership- (problem solution)Although Johnson Johnson has not competed on cost in the market it must try to cut costs because it is currently under attack from its competitors on both quality and cost of products. Therefore it must be seen to be challenging the competition not only on the quality of the products but also on the cost.MARKETING MIX STRATEGIESMarketing mix strategiesThe marketing mix is the means used by the marketer to satisfy customers.Product policies- new product development brand developmentstigmatisation family, corporate branding. mark is part of the actual product and is a major issue in overall product strategy. Brand ing is used to give products unique identities and helps the marketer to differentiate their product from those of competitors use a tool.Branding Strategy Family branding this involves using a brand image and name for a range of products.Corporate branding this means that a company uses its own company name as a brand for its products. several(prenominal) branding this means that each product is given a distinct name and image by a company.Johnson Johnson must use this strategy because the brand name is well established, launch costs of new products may be low and brand loyal customers are more promising to try the branded new productsNew Product Development An organisation that wishes to survive long term, must invest in new product development (NPD). Always, all products eventually reach the decline stage of the PLC. Without new products an organisations sales will eventually become non-existent and Customers will seek competitors products. Additionally, by introducing new and innovative products to the market place first, an organisation may generate customer loyalty and maintain its market share as the market grows. NPD is costly and can be a long process. If a new product fails, a company may make huge financial losses and the ensuring bad publicity can be detrimental. The NPD process helps to minimise the risk of failure. Johnson Johnson must heavily invest in this strategy of new product development.Promotion policiesPromotion is more than just advertising. It includes almost any form of communication that a company has with its customers.Indeed, it includes communication with stakeholders, suppliers, intermediaries and the general public. The range of parties that a company promotes to is known as the target audience.Promotion strategies and the communities mixWhen a company is pursuing a pull strategy, it promotes its products to the final customers to encourage them to buy. They are encouraged to demand the product from intermediaries.Place pol iciesPlace is the term used in the marketing mix to mean distribution. distribution involves all the activities necessary in getting a product to a customer.Distribution can be looked from two perspectives channels of distribution and physical distribution. distribution channel of distribution refer to the organisations involved (distributors, wholesalers, retailer, agents). Physical distribution refers to the physical transportation, handling and storage of products necessary to make products available to customers.