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Essay/Term paper: Technological impact

Essay, term paper, research paper:  Sociology Essays

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Technological Impact. · Changes in market demand · Marketing strategy: - As a company devpelopes and matures it will have to changes it's marketing strategy to compete and grow with other companies that are challenging the present company. I will take the car industry for an example. In the industry group there are many different competitors. Weather large or small they are all fighting for a piece of the nation and international market. The larger companies will have just as much trouble adjusting to change as a smaller company. This is because a small car company that does not produce many cars will find that to advertise a car on a small scale will probably take the same percentage of profit as a large company that needs to advertise on a large scale to keep the company going. In the car industry, manufactureres will be bringing out new models and varieties of cars all the time due to the intense competition to be at the top. There are seasonal changes in market demand; these become apparent when looking at car sales figures. There are highest sales of cars when the new registration plates for cars used to come out in August. This large demand for new cars was due to people wanting to have the newest cars available to them and they can show them off as people tend to notice the new letter at the beginning of the registration. The government has tried to stop this large demand for cars with new registrations by changing the registration twice a year, the letter also changes in March of each year as well as August . This may in theory have been a good idea but in practice it does not seemed to have paid of as most people that are buying a new car will tend to have it for a year before changing it for a different car. This is mainly because of the large amounts of money that is needed for road tax and car insurance and so people will not want top fork out more money for a new car as well as tax and insurance. As new models come out onto the market from other companies, this will cause demand for the present models of cars to be reduced because of the interest in the new model that not many other people have. A Company can deal with this sort of advance on the market in two different ways. The first is by re-advertising their present car/s or to improve the existing advertising. The second is to start to design new models or to improve the car they have at the moment so that it is better and in more demand than the other company. The first way of dealing with this is the cheaper option but may not be as effective as the option. Advertising is not as expensive as producing new models. If advertising is to be the chosen method of fighting back at the market then it will have to be done effectively or it will just be a waste of time. In the advertising it should be un-apparent that it is meant to be fighting back against the new product. It should highlight all the points about the car that are the same as the new model on the market and emphasise any points that are better than the in the new model however small they are. If the company decides to produce new models of cars to compete with the market, they will have to think vary carefully about how they are going to approach this. There are three major questions that they must ask themselves, do we improve the bodywork? Do we improve the engine? Do we improve both? The cheapest options to improve the design and look of the bodywork. To do this is least expensive of the three. To start with the company is going to have to design and test the new look bodywork. The look is not only going to have to change but also its properties and why is it better than the new car on the market. If their present car has been on the market for a few years then this will tend to be a better move on the their part. The tooling on an automate body work line will have a life expectancy of 3-4 years before the wear is to great and needs to be replaced. If this is the case and the line is coming to the end of its life time then it may well be worth investing the £2-3million needed to change and replace the production line for the new model than carry on producing the older model. The break-even point for car bodies is about one year so for the next three the company will be making profit if the cars sell. The second option is to design and improve the engines for the cars and fit them into the already existing models, which may increase interest and sales. This option is more costly than the first as a engine production line will last up to about 10 years and if a new line has been set up then it would be stupid to put in a new line as this will cost £10-15 million an will only break even after about three years. It may only be worth while designing new engines if the line is coming to an end and would need money re-invested into it soon. If your company had discovered a revolutionised engine that was so environmentally friendly, really cheap to run, relatively cheap to buy and those sort of factors all in one engine; then it may well be worth starting up a new production line as this sort of engine would be in great demand. The third option is the most expensive and risky to a business as if it all goes wrong then a lot of money has been invested into this and may cause grave damage to the company. A combination of the two may be the best way to go as the company could improve parts of the engine and body and not totally re-design them. This would probably give the best results if mixed with advertising.  

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