Read About Business Model Page 13 Describe The Business Mode

Read Aboutbusiness Modelpage 13 Describe The Business Mo

Instructions: Read about Business Model Business Critical Thinking exercise :Bottled water is a hot industry with sales of $11.8 billion in the United States. Bug players in this industry include Nestle, PepsiCo, and Coca-Cola. Nestle is the market leader with four brands among the top 10 leading brands. Nestle’s Pure Life brand was the top-selling brand with sales of $1.18 billion, but the company’s other brands makeup and additional $1.6 billion, giving the company total overall sales of almost $3 billion. Nestle saw an opportunity in this market and launched a new brand called Resource, targeted to affluent women.

Resource is fortified with electrolytes and is promoted as “more than hydration, it’s total electrolytenment.†Nestle is attempting to take market share away from Glaceau’s Vitaminwater and Smartwater. If Resource attains just 3 percent market share, it will be among the top 10 selling brands. Find out how to calculate Nestle’s Pure Life and the company’s overall market share in the bottled water industry. Select one of the following companies: Starbucks (investor.starbucks.com), Pfizer ( /investors), or Best Buy to find examples of strategic and financial objectives and more. (1) List four objectives for the company, and indicate which of these are strategic and which are financial. (2) Click on the investor relations section, and (1) explore the latest annual reports and/or 10-K filings to see if you can identify the key elements of company’s strategy.

Use the framework provided in Figure 1.1 to help identify these key elements. What approach toward winning a competitive advantage does the company seem to pursue? (3) Check whether the company’s recent financial reports indicate that its business model is working. Can the company’s business model remain sound as more consumers go to the Internet to find general information and stay abreast of current events and new stories? Is its revenue stream from advertisements growing or declining? To what degree does its strategic response to changing industry conditions seem positive and deliberate versus reactive and adaptive (emergent)?

Expected outcome : Written answer based on the three questions (All participants must post this written assignment; answers must be submitted in only one word document. Submit the assignment through the W1 Turnitin link shown below.

Paper For Above instruction

The exercise involves analyzing the bottled water industry and understanding the strategic and financial objectives of a selected company, such as Starbucks, Pfizer, or Best Buy. It also requires investigating the company's strategic approach and evaluating whether its business model remains effective amid changing industry dynamics, particularly considering the shift toward digital consumption and advertising.

The bottled water industry is highly competitive, with Nestlé, PepsiCo, and Coca-Cola dominating the market. Nestlé, as the leader, owns several top-selling brands, including Pure Life, which generated approximately $1.18 billion in sales. Complementing this, Nestlé’s other brands contribute an additional $1.6 billion, amounting to around $3 billion in total bottled water sales. Recognizing a niche market, Nestlé launched Resource, a premium electrolyte-fortified water targeted explicitly at affluent women. This strategic move aims to capture market share from established competitors like Vitaminwater and Smartwater. If Resource captures just 3% of the market, it would rank among the top 10 bottled water brands.

To evaluate Nestlé’s position, one must understand how to calculate its market share. The market share of Pure Life can be determined by dividing its sales of $1.18 billion by the total bottled water market size, which was $11.8 billion, resulting in approximately 10%. The overall market share for Nestlé, considering all its brands, is roughly calculated as its total sales of about $3 billion divided by the total industry sales, indicating a substantial portion of the bottled water market.

Switching focus to a chosen company such as Starbucks, Pfizer, or Best Buy, it is essential to examine strategic and financial objectives. For example, Starbucks’ primary objectives include expanding global store count (strategic), increasing same-store sales (financial), enhancing digital engagement, and promoting sustainability initiatives. In contrast, Pfizer’s objectives involve advancing pharmaceutical innovation, expanding market presence globally, increasing R&D investments, and shareholder value.

Reviewing recent annual reports and 10-K filings provides insights into the company’s core strategy elements using frameworks such as Porter’s competitive strategies or Ansoff’s matrix. For example, Starbucks pursues a differentiation strategy by emphasizing premium coffee products, personalized customer experience, and digital integration. Its approach aims at creating a sustainable competitive advantage through brand loyalty, innovation, and global expansion.

Assessing the financial health presented in recent reports indicates whether the business model remains viable. Starbucks has shown consistent revenue growth, driven largely by domestic and international expansion, online and mobile ordering, and product innovation. The shift to digital orders and mobile payments has contributed to increased revenue streams from digital platforms, which now constitute a significant portion of total sales. However, the pandemic prompted rapid adaptations, reflecting a reactive yet strategic response, emphasizing resilience and future growth paths.

The sustainability and adaptability of these companies' business models depend on their ability to innovate and respond proactively to industry trends. With consumers increasingly searching for information and purchasing online, companies that harness digital marketing, e-commerce, and personalized engagement are likely to sustain growth. Starbucks, for instance, has effectively integrated digital ordering to maintain and grow its customer base, while advertising revenue remains stable or increasing due to digital campaigns.

In conclusion, both competitive positioning and adaptability are crucial for long-term success. While digital transformation presents challenges, it also offers opportunities for companies to refine their strategies, strengthen their revenue streams, and maintain a competitive edge amid evolving industry conditions.

References

  • Barney, J. B., & Hesterly, W. S. (2019). Strategic Management and Competitive Advantage: Concepts and Cases. Pearson.
  • Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2020). Strategic Management: Concepts and Cases. Cengage Learning.
  • Nestlé. (2023). 2022 Annual Report. Retrieved from https://www.nestle.com/investors/annual-report
  • Starbucks Corporation. (2023). Form 10-K. Retrieved from https://investor.starbucks.com
  • Pfizer. (2023). Annual Report. Retrieved from https://investors.pfizer.com
  • Best Buy Co., Inc. (2022). Annual Report. Retrieved from https://investors.bestbuy.com
  • Porter, M. E. (1985). Competitive Advantage. Free Press.
  • Grant, R. M. (2019). Contemporary Strategy Analysis. Wiley.
  • Grewal, D., & Levy, M. (2019). Marketing. McGraw-Hill Education.
  • Johnson, G., & Scholes, K. (2019). Exploring Corporate Strategy. Pearson Education.

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