First Solar was founded in 1999 from the Walton family. According to the Marketing Sun Power, First Solar’s mission is “to create enduring value by enabling a world powered by clean, affordable solar electricity.” (p. 90) The company manufactures solar modules, which have razor-thin cadmium telluride. They are manufactured this way because it can still produce electricity even when clouds are blocking the sun. With this product First Solar wants to promote that it is socially responsible. It not only markets its cost efficiency through solar energy, but it also helps maintain sustainability by reducing the use of fossil fuel. First Solar products have advantages with rival companies because its product does not depend on silicon wafers. Silicon wafers is the preferred product from other solar companies. Silicon wafers is a costly product and it’s also a scarce resource.
Key Marketing Issues
•Competition: In the business world competition is when businesses or firms enter the market with similar products. Per the article First Solar does not seem to have great threat of other firms, as it is the leading manufacture of solar power. First Solar uses razor-thin cadmium telluride material, while other companies use silicon wafers. Silicon is a scarce material and expensive as well.
•Oligopoly: I would consider First Solar to be an oligopoly. Since it seems that there are few sellers that control the solar panel market. I would also say that since First Solar uses different material it has an upper hand when it comes to solar modules. This can change if different innovations enter the market.
•Political Forces: Political force can always influence the wellbeing of a company. For example Germany and other European nations are encouraging alternative energy and that is why Germany has become First Solar’s target market.
•Technological Forces: Technological forces will continue to change the marketing perspective, because technology changes. Marketing strategies change to adapt and become appealable to consumers.
•Government: Governments from various nations can influence with providing subsidies that help corporations maintain a decreased rates for solar energy. A problem that First Solar and other solar companies will have to tackle, because Germany will be reducing its subsidies soon.
Personal Case Analysis
As a personal analysis I was intrigued by the product differentiation between First Solar and other solar companies. Most solar companies use silicon wafers for their solar cells and panels. First Solar uses a razor-thin cadmium telluride solar cells and panels, which makes them an innovator of this product (what makes them marketable). They expect to decrease its cost to .50 cents per watt by 2014, which is 50% less than what is being paid at this moment. First Solar is not only based out of Tempe, Arizona, but it’s also marketed globally. Germany use to be its primary market, but now it is moving to the North American market.
1-Which marketing environment forces are likely to have the greatest impact on First Solar?
The greatest impacts from environmental forces are Economic Conditions (buying power), Political Forces, and Technological Forces. Economic conditions change in which can affect the buying power. A perfect example would be the subsidies that are being received in Germany. Buying condition can decrease when the subsidies are lost. Unless there is a political agenda or lobbying involved. This is when technological advancement can be improved to provide a less costly product.
2-What types of organizations are most likely to exert the strongest competitive forces on First Solar?
In order for a competitor to compete against First Solar, they would need to develop a superior product then what First Solar has produced. First Solar has produced a razor-thin cadmium telluride product that even works on cloudy days. One company that I think could bring competition would General Electric. General Electric is a well-established company that is looking into being a sustainable company and has the wealth to pursue solar panels.
3-How did technology affect First Solar’s responses to the changes in the marketing environment? How can it continue to maintain its technological edge in its industry?
First Solar started out because of high oil prices, environmental concerns with natural resources. First Solar does not use expensive material like silicon wafers, which is a scarce material and very costly. It will continue to maintain its technological edge because it is aware that it needs continuous assessments in every aspect of the market (fossil fuel, government, technologies, innovation, and consumer demand).
First Solar has developed a product in which reduces the use of fossil fuel and creates alternative energy. Its marketing strategy has been focused on its unique development of technology (cadmium telluride cells) and the need to provide consumers and businesses a more sustainable product with a lower cost. Due to these advantages the company can attack the market aggressively. First Solar is aware of the challenges that will arise in the future. Environmental forces keep companies always on edge, which makes them continue to improve with new technological innovations. Marketing plans need to be adjusted on a continuous basis due to changes that may arise from government, natural resources, political views and social views.
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