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Global Business Strategy

Executive Summary of Elkie and Ark Environmental Analysis

This report highlighted the impact of environmental factors on the expansion of the firm Elkie and Ark in the USA. The operations other than the host country creates challenge and opportunities for the company with environmental factors directly impacting business operations with tax structure, favorable technological advancement. Elkie and Ark can take advantage of labor, materials, and improve production facilities. As a change in location for expansion firms should use marketing, product differentiation. The use of try and buy model as opposed to direct sale on the e-commerce portal would made a distinctive impact on the use of linen and market bag. The diverse environment and stronghold of technology provided an opportunity for the company in designing its marketing decisions for growth and market share. The report addressed government programs as an enterprise can use a soft landing program for centralized resources and mentoring programs.

Table of Contents

Introduction.

Environmental analysis.

Ethics and CSR..

Competitor analysis.

Marketing mix for the USA..

Conclusion.

Reference.

Introduction to Elkie and Ark Environmental Analysis

Elkie & Ark is an organic linen company based out of Australia. The company was established in the year 2016 and focus on the ethical, sustainable product (Elkie& Ark, 2020). The firm is known for its sustainability, CSR practice and company is in operations in organic linen caters to the luxurious brand. The USA is one of the largest economies in the world has the potential for expansion in geographical and technological leverage for the company depending on the analysis. The expansion of the market will require a change in marketing and environmental promotional aspects in influence with environmental analysis. The USA has been ranked sixth in ease of doing business this adds to the attraction of the location for investment (Doing business, 2020). The category segmentation and brad advertising have to be monitored.

The purchase through the bundled product will be central to new market expansion. The product category through the existing range on organic clothing as tough competition form ethical organization in the USA that is brand conscious and prefers a brand with existing market composition over emerging players. The brand will have an edge in the ethical and luxury segment with its tie-up with the UN as part of the Aim2flourish program (Eike& Ark, 2020). The company country sources from firms in Australia and outsource material from Belgium, India among few. The bath and linen market in the USA is its growth stage and is expected to grow at a CAGR of 7% on-demand in organic bed and linen (Statista, 2020). This report highlights the environmental analysis concerning expansion in the United States.

Environmental Analysis

PESTLE is a marketing tool used to analyze the key factors (Political, Economic, Sociological, Technological, Legal, and Environment) that influence an industry. The external factors of the USA help to determine the firm's business and strategic operation concerning the macro environment.

Political Factors-. The current political climate is stable with recent challenges with racial discrimination and trade war between the USA and other countries. The country is a member of the development council and is accused of interventionism by various parts of the country. The USA is a good investment for foreign companies and provides infrastructural support in expansion (Manufacturing government, 2020). The tax policies of the government are varied with taxes paid in the country origin that can lower the profitability and influence expansion of the brand in the country (Lexis Nexis, 2020). As a part of large democracy, the external group exerts pressure on the government. The operations of the firm influence business operations as being pressure groups. The government role is significant in the business operations and incentive program. The government is stable with 4 years term as standards measure and the current regime is following the same pattern. The assessment of risk requires General stability risk, ownership, transfer risk, and operating risk. Assessing operations of expansion will require the business planning team to use Delphi technology to share opinions and use the first-hand appraisal to measure operation feasibility and regulations (Wasieleski, 2018). Textile and apparel have federal labeling and must comply with the requirements of textile. The exchange rate is considered dominant. The localization of operations will contribute to Elkie &Ark to develop supplier relationships in the country.

  • Economic Factors-The US economy is one of the most powerful with ranked as number 2nd in the Global ranking (Marjis, 2019). The widespread unemployment has questioned the country's position with a stance on unemployment and global crisis that accumulate to a recessionary environment. The trade war and oil crisis have impacted the purchasing power and operations of the firms in the market with geopolitical uncertainties. In comparing the wealth structure the segment of luxury is booming with customers demanding exclusive and sustainable products. The pricing of the product will have to modify as the industry players in the luxury organic line are not wide. This is advantageous for the company. The international market recessionary environment and purchase spending are proportional to the economic value and revenue of the industry. The linen industry is growing with the rise of e-commerce. The expansion of income is concentrated that will be favorable for the brand with capturing niche brand The foreign exchange rate amplifies the ROI and attribution and economic growth are quick. The current fiscal policy and marketing decisions with packaging and compliance suitability will be the firm s focus
  • Social Factors- The country's aging population and social pattern and education system has given rise to the luxury market and sustainability desired by consumers (Marjis, 2019). The brand has the potential to the social class and consumer purchasing to create its lineage and acquire a new customer. The country has a liberal mindset and has experienced racial tension in recent times. The consciousness of the brand in its marketing should ensure sensitivity to culture and color. As a marketing manager the company focus on the purchasing trend for building a strong relationship with consumers. Using personalized content for bags specifically designed for women the luxury segment for age 25-50 would be the target market for the brand. The social diversification of the geographical population is large hence the company has to market each segment specifically to ensure the brand is effective in sustainability and current demand of the consumer. Degree of social unrest in the USA with black lives matters with global support from brands. Creating design and inclusion of diversity by using model all color will act as a strong single for unity in social unrest. Linguistic diversity shows the majority of the user speaks English with 80 % user base, Spanish, German are other languages spoken (Lexis Nexis, 2020). The consumes motivation of the product has to be tapped with an examination of the study, analyzing behavioral pattern by th roll our one division or initial period will help in evaluating consumer response for the product. The consumer precedes of the good can be developed through external tributes as organic, ethical, and loyalty drove to match the style and impact the sector to create market share.

Culture- Cultural comparison -

  • Power distance- The inequality with inferiority is not acceptable with widespread movement across the USA
  • Uncertainty Avoidance- The degree of uncertainty is less in the USA as compared to Australia
  • Individualism- Individualism concerning self is high in the USA.
  • Masculinity- The cultural domain is largely masculine.
  • Long term orientation- the USA with its cultural component can be called a long term orientation.
  • Indulgence- The USA cultural aspects have high indulgence with similar comparison to Australia.

Trade and tariff measures with changing laws towards foreign associations can be a negative influence and the implementation of internet access can reduce the overall gross margin of the product. The highly skilled workforce for training and development that can lead to workforce development and automation support that is gradual in other country but very high in the USA (Simon, 2019). The current inflation rate is low in the USA and the new stream can be developed with enabling profitability and adjacent product segment. As store marketing is direct competition for business prospects enhancing the digital channel and exiting base for the USA will be a challenge. E-commerce accelerates payment for brand building and e-retailing options. Digital marketing can foster store sales and channel delivery. Technology can create a new digitalization channel for the supply chain cycle and digital prototyping with productivity and improving the in-store experience. .Cultural pattern regarding the shift to organic linen for other sustainable products with rising conscious consumers. Attitude and shared belief for customer service, religion, and lifestyle trends for a credit available for raw material cost.

New pattern and political outlook with the president, R&D positively impacts and communication. Licensing and technological awareness for lifestyle and cultural engagement with society. The country is segmented on the cultural dimension of Aboriginal and non-Aboriginal. American –African. The white segment is considered richer and the wage gap between them is part of the cultural difference among the product sold. The use of modern lifestyle, wear is more appreciated with ease to rinse, and supreme quality. The population is largely working population and high-end business. The online purchase behavior and shopping patter has shown consumer purchase through click and pay higher in consumers. The racial divide between the communities and aspirations for quality products has given rise to a rise in bedsheets, and organic line industry growth. Brand marketing plays a critical role in consumer purchase and increasing outreach of the consumer. The competitive market and product offering with distinctive feature benefits the firm in marketing and promotion. The purchase pattern by the direct biller, discount pattern, and subscription model can influence the shift from existing marketing plyers to Arkie.

  • Technological Factors- The technological advancement of the country is unarguably very strong. Technological innovation and immersive technologies have all been across the US market as the first nation (Manufacturing government, 2020). Technological advancement will favor the brand in creating AI/ML interactive sessions for a product launch. The penetration of social media and the use of technology adaptation is high that can impact the popularity of the product and its growth. The automation and production cot are reduced with relocation and technological mobility offered in the USA (Henisz, 2017). The brand can offer commercial discounts on the product and tie- up with third party merchants for exclusive payment integration for ease of purchase. The use of DIY videos with model depicts able and fashion ability of the brand will distinguish the brand in creating images in the consumer mind. Luxury product marketing through advertising in social media and website design will create user base. The industry revitalization through technology creates distinction among but is largely centered on the distribution model as material sourcing is largely manually based. The entrance of a new brand will have to set up a supply chain and ecommerce facility to ensure customer marketing. The marketing impact on the millennial sector specifically hence shown more reliance on online purchases and as tech-savvy product purchases.
  • Legal factors- The favorability of legal factors is one of the major factors that drive the long term sustainability of the brand. The government structure is divided in each state with jurisdiction and structure of the state that guides the operation of the firm. The import and export policy between the MNC operations has been neutral and does not impact linen operations by the company. The corporate has been revised with a 21% tax for multinational companies (Select USA, 2020). The tax structure in the USA has multiple tax limits for foreign entirety operations, they are corporate tax, and customs duty and import tax, sales tax on the sales transaction, and directly related to industries with retail and manufacturing such as Elkie and Ark. The adaptation of marketing as offensive to morals and government policy and against purpose will lead to penalties and heavy scrutiny on the brand by the advertiser. The legal structure is liberal but America first may impact the operations and sale of the product. Legal factors are to be monitored by the compliance team to ensure functioning with marketing practice. Legal regulation on sourcing and suitability with environmental protection is the standard which company is already enrolled in (Motohashi, 2015). The consumer protection laws are stringent in the USA. Elkie& Ark has to design principles on natural protection and using orderly conduct in its operations and distribution of goods. The labor availability and level of automation will increase brand costing and its strategy for weaving and production. Advertising restriction on sublimed perception whereby attempt below the threshold. As deceptive as per Federal Communications Commission in email marketing, the principle rules as to use opt-out procedure, labeling the message as advertisement and opening of multiple email account is prohibited as per Federal CAN-Spam Act (Select USA, 2020).

Ethics and CSR

 Focus on environmentalism to promote organic products in this segment. Creating awareness through a sustainable model and partnership for societal benefits. Employing fair conduct and employability practice as per Work standard in the USA for transparency and ethical shopping this has been consumed for linen with consumer's purchase to the brand that supports a good cause and pays extra for quality ad sustainable products. Brand loyalty can be developed through existing product image as – Sustainable, ethical luxury. The sourcing of eco-friendly practices will add credibility and build loyalty and transparency. The market scope for the industry is diverse with ethical sourcing for luxury wear (Her Mag, 2017).

Competitor analysis

  • Identification of competitors- The US organic line and luxury segment have top companies as Boll and Branch, Brook linen, and Coyuchi. The supplier bargaining power is medium in this segment
  • Competitor strategy – Using product differentiation and focus on healthy living as a strategic point for sale. Developing differentiation based strategies. Using global sourcing and distinctive competitiveness through customer service and linen weaving as designing variation.
  • Using adaptation measure as per consumer preference and combating customer resistance as opposed to standardization
  • Segmentation- Product segmentation for the niche market and e-commerce only availability in the USA and using the quality matrix to gain market share.

Marketing Mix for the USA

  • Product- The product labeling is subject to the American National Standard Institute and assessment of the system for standardization. Environment laws on Resource Conservation and Recovery Act for dumping materials into lakes and steam draw penalty, Toxic substance act for preventing harmful emissions (Doing business, 2020). The local law standard as Fair Labor standard outlines the minimum wage and overtime payment. Research and development collaborations and buying collaborations are not considered anti-competitive practices. Price rigging, and lowering production cost and act as market power with product focus on differentiation.
  • Price- Government imposes import tax that will impact the price of the product. Using luxury price points for niche customer segments.
  • Promotion- The increase in sales are started through modern technological experience with easy to shop experience and use if smartphone for purchase and click to purchase a product through an aggregator such as Facebook, Instagram, and Twitter. The use of push notifications and real-time reviews on the purchase will add to usability experience and building brand trust in the consumer (Bruce, 2017).
  • Place- The current payment partner of the brand Elkie & Ark, this creates an easy cart to purchase options for the brand. The competitive advantage to use potential technology monitoring and strategic consideration are critical. Using disintermediation will provide the benefit of economies of scale. The use of ERP and hub and spoke model for distribution direct to the customer can be developed for using product category (Kim, 2015).
  • People- Elkie& Ark would have to include staff training and building expertise for online portal efficiency in the market for supplier network and customer post-purchase.
  • Physical evidence- Using website tangibility and highlight sustainability with credibility optimization through reader review and in-house tour.
  • Process- Focus on data privacy and payment partnership for secure payments in online transactions.

Conclusion on Elkie and Ark Environmental Analysis

 The availability and use of technology are more diverse and aggressive in the USA as a comparison to Australia. The USA is a high-income country and is the old economy with adaptability with its legal structure and large income group that is ideal for luxury linen and organic product expansion in the country. Creating a sustainable network in the USA firm has to develop business competency among local supplier networks and using personal branding and website optimization for brand building in the USA for marketing.

References for Elkie and Ark Environmental Analysis

Bruce N. &Rao, R. (2017).A dynamic model of advertising: The effect of creative advertising message content and targeting on engagement. Journal of Marketing Research, 54(2), 202-215

Doing Business. (2020). Economic Profile USA. Retrieved from https://www.doingbusiness.org/content/dam/doingBusiness/country/u/united-states/USA.pdf

Elkie & Ark. (2020). Our Story. Retrieved from https://www.elkieark.com/collections/organic-bed-linen

Henisz J, W. (2017). Corporate Diplomacy: Building Reputations and Relationships with External Stakeholders. NY, USA: Routledge

HER Mag. (2017). Founder Interview. Retrieved from https://hermag.co/elkie-ark-annethrelfall/

Kim, C.W. Mauborgne, R. (2015).Blue ocean strategy: How to create uncontested market space and make the competition irrelevant. Harvard publishing house

Lexis, N. (2020). Macro environmental analysis. Retrieved from https://internationalsales.lexisnexis.com/glossary/compliance/pestel-risk-monitoring

Lynch. (2019). Strategic management. Person education is limited. UK publishing

Manufacturing government. (2020). Program. Retrieved from https://www.manufacturing.gov/programs

Marjis, J., Huelleman, W., (2019). Economics and business environment. Taylor and Francis: USA

Motohashi, K. (2015). Global business strategy – Multinational corporations venturing into an emerging market. Springer publication

Select the USA. (2020). Why invest in the USA. Retrieved from https://www.selectusa.gov/why-invest

Simon, H., Fassnacht, M. (2019). Pricing Management strategy, analysis, decision, and implementation. Springer publication: USA

Statista. (2020). Size of the bed linen and bedspread market in the United States from 2013 to 2020. Retrieved from https://www.statista.com/statistics/791774/us-bed-linen-and-bed-spread-market-size/

Wasieleski, M., Weber, J. (2018). Corporate social responsibility. Emerald publishing house: USA

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