Transcending politics and ecology, an Israeli cosmetics firm goes global
Analyze the relevant factors in the business environment of this company. If you don’t find information in the article on some of the facets of the business environment, feel free to speculate or to use other sources. For each trend, explain if it represents an opportunity or a threat.
Business environment comprises of external and internal factors that influence the performance of the company. The case of Ahava reveals that its performance, successes and challenges faced by the company can be traced to the nature of environment, both internal and external, where the company operates.
To start with the internal environment, it is apparent that the company’s success is mainly because of the internal forces or factors. The first internal factor is the good organizational or corporate culture as evidenced by high entrepreneurial spirit of the founders. It is because of this spirit that the company was founded.
The case shows that Ahava was founded when Ziva Gilad and other partners noticed female tourists bottling mud to take home and opted to start a business of selling the same mud but in processed form to tourists (Lev-Ram, 2009). Organizational or corporate factor is a source of opportunity to the business. Other internal factors include proper management, and innovation and invention. All these factors offer opportunity to the company.
Apart from the internal environment, there are many external factors that influence the performance of the company. The first external factor is the political factors. The case reveals that the company is under the threat of political forces such as Israeli-Palestinian conflict. The case reveals that most of the countries in Europe have even started sanctioning the products from the Israel.
Another external factor that influences the performance of the Ahava is the ready market. The case reveals that the cosmetic products produced by the company have huge ready market, both locally and internationally. This is evidence by the assertion made by Iva Litovsky that “Thousands of tourists come to the Dead Sea for the spas and the treatments” (Lev-Ram, 2009). This is an opportunity to the company.
Another external factor constituting the external environment that influences the performance of the Ahava Company is the minimal competition. The case reveals that Ahava has competitive advantage over its competitors in many respects such as acquisition of raw materials, advertising and even the sales stalls.
Explain the strategy of the firm, in terms of targeting and positioning.
The case reveals that the company has good targeting and positioning strategy. Right from the time it was founded, the case reveals that the company has been having good targeting strategy. In fact what compel the founders to venture into the business is the ready market provided by thousands of tourists who come to the Dead Sea for the spas and the treatments (Lev-Ram, 2009). The case also reveals that the company is uniquely positioned to capitalize on the area’s natural resources and translate them into an export product.
Explain how the targeting and positioning for this firm’s products are reflected in the marketing mix.
Marketing mix is summarized by 4 ps. The 4Ps are represented by product, place, price and promotion. The targeting and positioning are reflected by two Ps of the marketing mix, the place and promotion. Concerning the place, the case reveals that the company was positioned in a place where the market is high. Dead Sea is the most suitable place through which the company could sell its products because thousands of tourists could come for the spas and the treatments (Lev-Ram, 2009). In addition, the company is expanding its place to international level. The case shows that the company has expanded its market to America and Europe.
As far as promotion is concerned, the case reveals that the company has put in place many measures to market its products both locally and internationally. This is evidenced by the fact that since 2000s, the Ahava started to pour the necessary resources into marketing, advertising and branding abroad (Lev-Ram, 2009).
Lev-Ram, M. (2009). Turning Dead Sea mud into money; Transcending politics and ecology, an Israeli cosmetics firm goes global. CNN. Last Updated: December 10, 2009: 9:51 AM ET
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