Geely Holding? Group? Marketing Essay

Markets,? Marketing? and? Strategy? Essay? ? ? ? ? ? ? ? ? ? ? ? ? ? Strategy? This? essay? will? attempt? to? identify,? analyze? and? discuss? the? strategic? issues? in? Geely? Holding? Group? using? industry? structure? and? dynamics.? There? are? five? competitive? forces? that? shape? the? strategy? of? a? company,? threat? of? new? entrants,? bargaining? power? of? supplier,? bargaining? power? of? buyers,? threat? of? substitute? and? rivalry? among? current? competitors.? However,? as? covering? all? five? forces? will? be? beyond? the? scoop? of? this? essay,? it? will? be? focusing? on? threat? of? ew? entrants? and? rivalry. Even? though? Geely? Holding? Group? exports? cars? on? top? of? selling? in? its? local? market,? its? main? market? is? the? China’s? automobile? industry1.? With? China’s? automobile? market? growing? rapidly? in? the? last? few? years,? it? has? become? one? of? the? biggest? automobile? markets? in? the? world,? this? mean? that? t he? existing? firms? in? the? industry? will? have? to? be? aware? of? new? entrants? into? the? industry.? Gerenally,? barriers? are? high? in? an? automobile? industry,? and? there? are? several? main? factors? contributing? to? this.? One? of? he? factors? is? supply? side? economics? of? scale.? When? firms? have? high? output,? it? allows? them? to? cut? cost? in? production? by? buying? in? bulk? and? because? they? have? huge? buying? power,? supplier? will? not? want? to? lose? them? as? customers? and? give? them? better? deals.? They? will? also? be? able? to? spread? cost? over? more? units? for? their? marketing,? research,? services? and? distribution.? This? means? that? new? entrant? will? have? a? much? higher? cost? of? production? unless? they? are? able? to? come? in? on? a? large? scale.? With? 1. 2? million? Geely? cars? on? the? oad? globally 2,? this? is? certainly? an? advantage? that? Geely? has? over? smaller? new? entrants. Established? firms? also? enjoy? demand? side? benefits? of? scale.? When? more? people? use? the? product,? it? will? assure? people? that? the? product? is? trustable,? causing? even? more? people? to? be? willing? to? pay? for? the? product.? With? products? like? automobiles,? quality? is? important.? Incumbents? have? the? advantage? of? having? experience,? acquiring? technology? and? building? customer? loyalty? over? the? years? thus,? unlike? entrants,? they? do? not? have? to? spend? as? much? on? arketing? and? advertising? to? prove? that? they? are? trustable.? In? 2010,? Geely’s? sales? surpassed? target? by? 15,000? units3.? It? sales? will? be? a? testimony? of? its? reliability? to? new? customers? who? would? be? more? willing? to? buy? from? a? company? that? is? doing? well? than? to? take? a? risk? with? a? newcomer.? All? these? will? discourage? entry,? as? entrants? will? have? to? keep? their? prices? much? lower? to? compete? for? customers.? To? enter? the? automobile? industry,? there? is? a? high? capital? requirement.? The? high? level? of? investment? sometimes? will? keep? entrants? ut? because? it? means? that? risk? is? high.? Entrants? will? need? not? only? to? invest? in? fixed? facilities,? they? will? need? to? invest? in? advertising? and? research,? which? are? mostly? unrecoverable? cost,? if? they? 1? Geely? Automobile? Holdings? Limited? Annual? Report? 2009? [ONLINE].? Available? 2? Geely? Holding? Group? [ONLINE].? Avilable? from:? from: http://hmdatalink. com/PDF/C00530/e00175(116). pdf http://www. geely. com/english/1? 6. html 3? Geely? Auto? sales? surpass? 2010? target.? (January,? 2011)? [ONLINE].? Avaliable?