Page 15 - MCS August Day 1 Suggested Solutions

SUGGESTED SOLUTIONS

be of particular concern for MONTEL given its multinational coverage and continued
acquisition aspirations. The most relevant aspect is the purchasing power of the
customers falling during economic downturns on which the industry is heavily
dependent which may lead to decreased revenue as customer may not consider
purchasing a new (or updating an old) camera.

 social influences will be a concern for MONTEL and will include social, cultural or
demographic factors. The industry is affected by the changing socio cultural trends and
people’s preferences and MONTEL have to adapt to these forces. For example, Sony
advocate that in some markets, customer needs and preferences are becoming more
similar. Electronics goods are standardised products therefore culture no longer has a
big impact. In fact, the more standardized product, the better chances to sell it
worldwide. This could help organisations to have 'transference of marketing' across
countries. Age distribution in the various populations is also an important factor that
companies have to keep in mind while targeting the consumers, e.g. the younger
populations favouring mobile phone cameras. There is an inextricable link between
changes in social habits, investment spend on products and therefore profitability. This
clearly results in the need for more detailed analysis to forecast future sales and the
resultant need to participate in the rise of “big data” to predict shifts in consumer
behaviour and customer preference.

 technological influences – technology and innovation have become important
determinants of market share in this industry. The more innovative the company, the
greater the potential effect on its market share. In the recent years technological
innovation has remained a major basis of differentiation for the consumers because the
customers’ focus shifted towards convenience, demonstrating that technology remains
one of the most important factors affecting the sales and profitability of the industry.
Similarly the effect of social media both on transference and storage of images on
marketing is very relevant. Online forums are growing in importance as consumers seek
advice, reviews and price comparisons before purchase. Advancements in technology
to be more competitive in the market is a key issue. Sony suggest, for example, that to
manufacture very innovative products that will be hard to copy and help to lead in the
market the company needs to invest and constantly improve its R&D department.

 ecological/environmental influences – laws related to environment friendliness and
disposal of products are constantly growing more stringent world‐wide with all the
major players in the industry having to refocus. The products which are low on
environmental effect may receive tax subsidies and are favoured by governments. From
a legal perspective, pollution tests have grown stricter and the products passing these
tests only are allowed in certain markets including EU and UK.

Environment friendliness has become an important test for industry in the 21st century
as governments have started focusing heavily on pollution control, necessitating a more
frequent asset replacement policy than in previous years. In addition the control of
waste on the external environment in terms of pollution and sustainability are of
increasing relevance to MONTEL due to disposal of waste products during the
manufacturing process. From an ethical perspective there is also considerable concern
as to the treatment and payment of workers, particularly given any potential move to
low wage economies such as Asia, fair treatment of suppliers in low cost negotiations
and the use of “greener” materials in manufacturing. Generally speaking the advent of
digital cameras has lessened the environmental effect e.g. reduction in use of chemical
during film development. However there are still chemicals present and they are

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