Essay on Marketing Management

Marketing Management
Assignment 6b The Schwinn Company used to hold up to 25% of the market share for the manufacture of bicycles. When the trend for bikes started heading towards mountain bikes, the company chose to ignore the trend and eventually found themselves in bankruptcy court. The company who was bought by an investment fund now only holds around 7% of the market share and is struggling to keep their place within the market. The company has chosen to offer a line of bikes that range in price from $100 to $2500 which leads to both opportunities in the market as well as threats. With a wide range of options and prices, the Schwinn Company is sure to have an option that will fit just about anyone’s budget. The problem with this pricing strategy is that consumers can begin to see the company as the “budget option” since they offer lower price bikes. This can discourage consumers willing to spend $2500 on a bike from looking at the Schwinn option since they may consider them cheaply made. Another threat to the company’s success is the fact that they are most often known for their old-fashioned “cruiser” bike. While this bike is one of their hottest products, it may be more difficult for consumers to separate this old-fashioned image from the company that wants to position themselves in the high-end, high-tech market. It is also difficult to get away from the image of “your parents bicycle” when the company continues to sell a version of this old-fashioned bike. Another threat to the Schwinn Company is the fact that its major competitors produce and advertise their products as American made. Schwinn has an opportunity to compete in this arena if they chose to buy the American company Yeti or another US company to manufacture their bikes. It is also difficult for the company to be seen as an expert in the production of mountain bikes when they had chosen to ignore that market for so long. They had also chosen to ignore the production of bikes in newer lightweight materials such as aluminum and alloys which educated customers are looking for. On a positive note, the company has over 100 years’ experience in the manufacture of quality bikes that the company could capitalize on.

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