Table of Contents
Introduction.
Overview..
Market position evaluation.
Products and services.
Market opportunity.
Sales and distribution setup.
Geographic area.
Target audience.
Competitors.
Customer need evaluation.
Marketing decision.
Conclusion.
References.
Glencore has been involved in oil trading since its inception in 1974. Today, in addition to selling oil products, it operates its oil business with its partners, invests and develops oil production facilities. The oil activities of the company are supported by investment in storage, strategic handling and freight equipment (Adams, Gilbert & Stobart, 2019). The customers base of the company includes industrial consumers such as steel, battery manufacturing, automotive, oil sectors and power generation. In addition to this, the company provides logistics, financing and other services to customers and producers of commodities. The company has a workforce of around 160000 individuals including contractors.
This paper presents a marketing plan for Glencore. In order to do so, the paper includes an evaluation of the requirements and needs of the customers and the competitors, to identify and determine effective criteria for business success. In addition to the need evaluation, the paper also includes a timeline for development and market position evaluation of the company.
In terms of the overview of advertisement and business marketing goals, Glencore aims to convey that it wants to maintain long-term business relationships with customers, to improve the extent, reputation and knowledge of the market. The company will adopt marketing change where they utilize the digital platform for promoting the products and services of the company to a larger platform.
The market position/situation analysis includes the key information regarding business competitors, target market, business challenges and the competitive differentiators of the company. It also includes a SWOT analysis of the company to examine the strengths, weakness, market opportunities and threats associated with the business to support strategic decision making. The market analysis of the company under consideration is mentioned below.
The company produces metals and minerals such as copper, nickel, cobalt, lead, zinc and ferroalloys for businesses. In addition to selling commodities that the company produces itself, it also sources metals and minerals from the extensive base of third world party commodity supplies. The company is one of the leading marketers of oil and crude products and supplies over 6 million barrels every single day to customers around the world. Moreover, the company also operates in agricultural products and supplies goods like grains, cotton, oil and sugar (Schlegelmilch, 2016).
The company can grow through acquisitions and by expanding its range of existing projects. The increasing consumption of minerals also presents a growth opportunity for the company as it can increase the number of coppers, nickel, coal and zinc mines to capitalize on the increasing demand. The marketing business of the company can also grow due to favourable market conditions in metals and coal (Mogorosi, 2016). In addition to this, the company is uniquely positioned to be able to capitalize on its scale and diversity.
The company is active at every stage of the commodity supply chain ranging from exploration, acquisition and development of new sources of minerals, extraction and production of the minerals. The company also refines and processes the raw minerals, along with blending and optimisation and blending, to the final delivery to businesses throughout the world. The company takes special care that the goods transported by sea, rail by truck but also their storage, processing and delivery to the customer to be on time and in quality parameters Glencore sells to a wide base of industrial consumers, in sectors such as automobiles, steel, semi-finished products, electricity and oil production (van den Brink, Klejin, Sprecher & Tukkar, 2020).
Glencore is highly diversified according to activity, commodity and geography. The company operates over 150 mining and metallurgical sites and oil production assets throughout the world. While the head office of the company is located in Baar, Switzerland, it operates in over 35 countries which includes Australia, Chile, Canada, South Africa (Matteoci, 2017).
The customers of the company mainly include industrial consumers in sectors such as semi-fabricators, oil, steel, automotive and power generation. The main customers of Glencore are in markers such as India, China and Europe. Its client list includes some of the worlds biggest firms including Tesla, BP, Total, ConocoPhilips, Vale, ArcelorMittal, Sony, ExxonMobil, Rio Tinto as well as the national oil companies of Mexico, Brazil and Iran (Mayyas, Steward & Mann, 2019). The company also delivers to public utilities in France, China, Japan, Spain and Taiwan.
The key competitors or alternatives of Glencore includes Peabody, Suek and Arch Coal.
Peabody is the biggest rival of Glencore. The company was founded in 1883 and operates within the diversified metal and mining sector. Peabody is headquartered in Saint Louis, Missouri and generates around $210B less revenue as compared to Glencore. Suek, on the other hand, is headquartered in Moscow city and offers products similar to Glencore (Marekha & Shcherbachenko, 2019). The company also operates in the diversified metals and mining sector and generals 2.65% of the total revenue of Glencore. Similarly, Arch Coal is also recognised as the key competitor of Glencore and like Peabody, it is also located in Saint Louis, Missouri. Compared to Glencore, Arch Coal has 150000 fewer employees (Yang, 2019).
Apart from these key competitors, some of the other business competitors of Glencore includes PT Bumi Resources Tbk., JamesRiver Coal company, Warrior met coal, Compass minerals and Rhino.
Swot analysis is used to examine the strength and weakness of an organization, along with the opportunity and threat associated with the external market environment.
The SWOT analysis of Glencore is mentioned below.
Strengths · International customers in power generation, food processing, steel production and automotive · Constant improvement in logistical capabilities and information systems · Strategic mergers, industrial takeovers and strong customer base (Mukoni, 2017) · The size and range of production facilities around the globe · Presence in 35 countries |
Weaknesses · Lack of focus on environmental protection and sustainable business operations. · Falling coal prices · Escalation production costs · Higher Australian dollar |
Opportunities · Opportunity to improve brand image through CSR activities · Diversification of business · Engagement of society · Transparent tax-paying policies |
Threats · Pressure from NGOs and government policies to implement sustainable practices (Abitbekov, Poma Canazaca & Chen, 2017) · Price competitiveness · The threat of being recognized as an environment harming the organization and anti-social |
Timeline for development of the strategy and launching the marketing plan in the market through which appropriate outcome can be achieved.
The Key performance indicators of the company for the marketing plan are as follows:
The target customer base of the company includes industrial consumers. The target audience wants to procure minerals for further production and resources like oil and coal for energy production. The marketing activities of Glencore are concentrated on major production houses, traders and energy producers. Customers want long term contract with a company for the procurement of minerals and metals for production, and a steady flow of raw materials (Abitbekov, Poma Canazaca & Chen, 2017).
For adopting the strategic policies and strategies for the company regarding the marketing activities the company has adopted marketing change where they utilize the digital platform for promoting the products and services of the company to a larger platform (Aggarwal, 2013). The company has also her technicians and digital marketers who identify their requirement and responses of the customers so that the company is able to make necessary arrangements for their satisfaction. The company focuses on maintaining the relation of satisfaction with the customers through which they are able to adopt market enhancement strategies. The company also launches some free elements and discounts through which they are able to attract a large number of customers for purchasing the products offered by the company. Glencore has also successfully evaluated the requirement of the market through which they have reduced the prices and they have also made certainty uses in the product specifications. The company has the highest range for selling the product in the market with the help of different distribution channels to which they are able to attract a large number of suppliers and wholesalers in the world.
In conclusion, the company can grow through acquisitions and by expanding its range of existing projects. The increasing consumption of minerals also presents a growth opportunity for the company as it can increase the number of coppers, nickel, coal and zinc mines to capitalize on the increasing demand. The company has also her technicians and digital marketers who identify their requirement and responses of the customers so that the company is able to make necessary arrangements for their satisfaction. The company focuses on maintaining the relation of satisfaction with the customers through which they are able to adopt market enhancement strategies.
Abitbekov, A., Poma Canazaca, L. S., & Chen, S. (2017). Commodities Market Development Project for Astana International Financial Centre: Copper, Natural gas, Wheat.
Adams, R. G., Gilbert, C. L., & Stobart, C. G. (2019). The Marketing of Commodities. Modern Management in the Global Mining Industry, 63-82.
Marekha, I. S., & Shcherbachenko, V. O. (2019). International Corporations.
Matteocci, A. M. (2017). Glencore PLC: decoding a black box.
Mayyas, A., Steward, D., & Mann, M. (2019). The case for recycling: Overview and challenges in the material supply chain for automotive Li-ion batteries. Sustainable materials and technologies, 19, e00087.
Mogorosi, T. M. (2016). An analysis of the inventory management system and controls at Glencore: a case of Rustenburg Smelter (Doctoral dissertation, North-West University (South Africa) Mafikeng Campus).
Mukonki, P. M. (2017). Strategic Mine Planning: A SWOT Analysis Applied to KOV Open Pit Mine in the Democratic Republic of Congo. International Journal of Geological and Environmental Engineering, 11(11), 997-1003.
Schlegelmilch, B. B. (2016). The Future of Global Marketing Strategy. In Global Marketing Strategy (pp. 221-249). Springer, Cham.
van den Brink, S., Kleijn, R., Sprecher, B., & Tukker, A. (2020). Identifying supply risks by mapping the cobalt supply chain. Resources, Conservation and Recycling, 156, 104743.
Yang, C. (2019). Essays on Commodity Markets (Doctoral dissertation, Duke University).
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