Market+Leader+Intermediate+3rd+edition+SB

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HUDSONCORPORATIONA luxury luggage manufacturer is facingincreased competition from cheaper imports.It must decide how to protect its brand andcreate new markets for its products.BackgroundHudson Corporation, based in New Jersey, USA,makes top-of-the-range luggage and Iravelaccessories. It is a well-known brand name in theUSA. Its suitcases and bags are associated withhigh quality, traditional design and craftsmanship.Hudson emphasises in its advertising that itsproducts are 'made in America'. Recently, thecompany's market share in the USA has decreased.One reason for this has been the increasedcompetition from Asian companies selling similarproducts at much lower prices.A year ago, the management decided to boostsales by entering the European market, focusinginitially on Switzerland, Germany, France andItaly. They set up a branch office and warehousefacility in Zurich, which would be the base for theirEuropean expansion.What problems do you think Hudson will faceon entering the European market? Make a listof your ideas.Market researchHudson recently set up a series of focus groups tofind out how consumers perceived the company'sbrand in the USA.Which of the findings do you think may havecontributed to the company's lower market sharein its home market?Do you think Hudson's% of peopleluggage and bags are: answering 'yes'expensive?exclusive?value for money?good quality?old-fashioned?exciting?innovative?72564882681518l)) (01.6 Four of Hudson'sAmerican managers aretalking about the problemsthey could face in Europe.listen and make notes onthe key points.scanned for Paul Jennings
ARKETING STRATEGIEFOR EUROPE - OPTIONSReposition the brandSell Hudson suitcases and bags at medium priceranges. Manufacture the products in a countrywhere labour costs are low, e.g. India or China.Do not promote the products as 'Made in America'.Use a high-volume, low-cost strategy for Hudson'score products.Develop the Hudson brandPromote the Hudson products as an exclusivebrand and keep the 'Made in America' tag. Sellthe products in the higher price ranges. Use productplacement in films and television to support thebrand. Hire a famous, sophisticated, influentialman and woman to endorse the products. Twowell-known French film stars have shown interestin endorsing a new range.Hire a top designerEmploy a top designer to produce a new rangeof smaller suitcases and shoulder bags aimed atbusinesspeople travelling in Europe and at rich,younger, fashion-conscious buyers. Sell theproducts under a new label.Develop a wider product rangeSell a wider range of products under the Hudsonlabel, e.g. trolley-backpacks, document cases,briefcases, name-card holders, shoulder bags formen and women. Sell at lower, competitive prices.Stretch the Hudson brandPut the Hudson brand on high-quality watchesand jewellery. Make an agreement with the Swissmanufacturers of these top-of-the-range products.Develop sales using e-commerceSell the existing product lines via the Internet atvery competitive prices.1 Work in small groups as directors of the Hudson Corporation.Hold an informal meeting. Consider the advantages anddisadvantages of each option listed above. Choose two ofthe marketing strategies which Hudson should focus on toexpand sales in European markets.2 Meet as one group and decide which two marketingstrategies you will use to develop sales in European markets.WritingAs the CEO of Hudson Corporation, write ane-mail to the head of European MarketingAssociates, David Wright, summarising theactions you agreed to take at your meeting,with your reasons. Suggest a time for a meetingwith David Wright and his associates.C) Writing file page 127Watch the Case study commentary an the DVD-ROM.oscanned for Paul Jennings13
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