Elliot Company Essay
The Elliot Company was established in the early 1950’s and has been a profitable greeting card company. It had always been a pioneer in developing creative means to attract its target group, in spite of which the group’s market share has been limited to merely 4% in the industry. Industry leader Hallmark has the lion’s share of about 41%, American Greetings about 30%, followed by over 300 companies, including Elliot Company that account for the remaining share.
Technological advancements in the telephone industry and the advent of the internet have pushed most greeting card companies against a wall, with flat sales, diminishing margins and a threat of decimation. The way forward is to identify means of generating sales by entering newer markets and the company has identified two markets that remain unexplored for Elliot Company
American Hispanic market
Overseas English speaking market
Elliot Company had never ventured into unchartered territories, and finds both these markets intricate. The American Hispanic market is unique and has different sensitivities than the dominant white and black market that Elliot Company has been catering to. Meeting the needs of the overseas market is even more complicated as the company would need to study several cultures and meet their respective needs. Marketing the product to both these unique markets is the challenge that Elliot Company faces, for which a solution is required. The company cannot enter both the markets at once, and hence an ideal market should be identified that would suit the interests of the company.
There are about 30 million Hispanics in America, who predominantly come from Mexico, Cuba and other Spanish dominated countries. The interesting facts about this population are:
The Hispanic population has the highest growing population in the country with almost 40% of population growth between the years 1985 to 2010, coming from this community.
The Hispanic population can be broadly divided into three groups, the native Spanish people who speak and follow Spanish culture alone; the assimilated Spanish, who cannot be distinguished from the Americans; and the Accultured Spanish, who are about 57% of the Hispanic population. (Arjona, Shah, Tinivelli & Weiss, 1998)
The Hispanic community prefer significant influence of their culture in the marketing process, even if the communication occurred in English.
Price conscious audience that chooses price over value
Just like the Hispanic community, the overseas market has different sensitivities that make it an equally tough opportunity to expand into. Also, there are certain problems the company faces when entering these markets, which are listed below.
Existence of multiple cultures in each country
Semantic barriers that can prevent communication as anticipated
Cultural perceptions about greeting cards, as customers in some countries prefer customized and hand written communication to pre-printed cards.
Huge costs of research & development, product and distribution.
List of Critical factors
The management if Elliot Company is apprehensive with both the solutions provided by the consultants, as each of them has their own concerns, which are listed above. A study shows that more than eighty percent of greeting cards customers, the world over are women. Hence, whichever strategy adopted by Elliot Company, would need to target the women predominantly. Which group of women, overseas women or Hispanic American women, can be targeted easily is one critical factor of success.
While venturing into foreign markets like UK, Australia, Canada and New Zealand would be good option for the penetration of the company into newer markets, it would expose the company to the competition of each market. While Canada is a market that Elliot Company should find easy to understand with its proximity to the American culture, each of the other markets is complex in their own ways. Hallmark has already made preparations to launch Spanish greeting cards by including several Spanglish messages (The Washington Times, 2002), and would aggressively market its brand when compared to Elliot Company. Hence, which market is less competitive and can easily be penetrated becomes the second critical factor.
The third critical factor is the consumer’s buying behavior in both these markets. Hispanic customers have a buying behavior that is strongly influenced by culture and cultural cues, which include importance for family, formality and status. (Haegele, 2000 in Lynn Brandon, Judith C. Forney, 2002) The above three factors can contribute greatly to the success of Elliot greeting cards in this target group, the company can focus the marketing strategy on how to express emotions to its family, how to upkeep formalities and use greeting cards as a status symbol for greeting someone. On the contrary, some of the overseas markets are less liberal and more demanding. The culture of Australia and New Zealand is strongly influenced from the English, and the English culture finds it more appropriate to send a personalized letter than a pre-designed and pre-printed greeting card. The success of the company is dependent on how well it breaks this cultural barrier.
In spite of the advantages of a larger market that the company can cater to when it reaches out to the overseas market, it is recommended that Elliot Company focus on reaching out to the Hispanic American community, by offering customized greeting cards.
The biggest factor that justifies the above recommendation is the huge costs involved in establishing a brand and a business overseas, in multiple markets. To reach out to the overseas English market also would require significant investments in research about respective cultures, making the cost of research irrelevant for the decision making process for either decisions.
A third of the Hispanic community would identify themselves with the rest of the Americans, and no special campaigns need to be done for them. However, the accultured Hispanics and the native Spanish speakers prefer a brand that they can identify with their ethnic group, to a business that seems very un-ethnic. (Dyer & Ross, 2000) Elliot Company should reach to the Hispanic community with a brand that they can identify with, design greeting cards based on their preferences and deliver the same as per their needs. Mere translations from the exhaustive designs that Elliot owns might not be as helpful, as designing cards that meet the needs of the Hispanic customers.
Luis D. Arjona, Rajesh Shah, Alejandro Tinivelli & Adam Weiss (1998) Marketing to the Hispanic Consumer, Journal Title: The McKinsey Quarterly. Volume: 1. Issue: 3. Publication Year: 1998. Page Number: 106+
Lynn Brandon, Judith C. Forney (2002), Influences on Female Purchase Motivations and Product Satisfaction: a Comparison of Casual and Formal Lifestyles and Anglo and Hispanic Ethnicity, Journal Title: Journal of Family and Consumer Sciences. Volume: 94. Issue: 1. Publication Year: 2002. Page Number: 54+
Linda M. Dyer, Christopher A. Ross (2000), Ethnic Enterprises and Their Clientele, Journal Title: Journal of Small Business Management. Volume: 38. Issue: 2, Page Number: 48
‘Spanglish’ Speakers Mix Home Languages; Popular Trend Seen as Obstacle. Newspaper Title: The Washington Times. Publication Date: November 21, 2002. Page Number: A01