Calveta Dining Services, Inc.: A Recipe for Growth HBS Case study Solution

Case- On a June day in 2009, Frank Calveta, president and chief executive officer of Calveta Dining Services, Inc., struggled as he prepared to present growth strategies to his father, founder and former CEO Antonio Calveta. Calveta was a $2 billion, privately held firm that managed food service operations for nearly 1,000 senior living facilities (SLFs) in the United States. When Antonio retired in 2007 after 35 years of leadership, he named his eldest son, Frank, CEO and told him to double the company’s revenues within five years. Two years in, Frank confided, “I can’t let my father down. I can’t abandon the special company culture we have or risk our reputation for quality food service. But after two years in this job I still don’t have a credible strategy for meeting those two promises and also growing the business as aggressively as my father wants.”

Calveta Dining Services, Inc.: A Recipe for Growth HBS Case study Solution- 

• Core issues related to the case
• Analysis of data for the root cause/s of the problem
• Probable solutions based on the root cause to solve the problem

CALVETA

Core issues related to the case:

·        To maintain the reputation it had earned over a period of time and a Fear of losing Calveta’s solid reputation as a leader in the health-care sector due to expansion of business into different segments.

·        Conflicting objectives of preserving the company culture and achieving aggressive growth simultaneously.

·        To have well versed employees in the organisation who can strongly follow the Antonio way of doing things in the organisation.

·        Conflicts and a sense of confusions in decisions related to expansion and diversification of business into other segments and acquisition of GSD. Financial Problems in Expansion of business beyond the SLF segment to hospital segment in order to double the revenue of the organisation.

·        Financial Problems in Expansion of business beyond the SLF segment to hospital segment in order to double the revenue of the organisation.

·        Losing of contracts and rising of Customers’ dissatisfaction due to frequent changes in management and account managers at different facility centers.

Analysis of data for the root cause/s of the problem

Preserving the company culture and achieving aggressive growth were conflicting objectives Frank knew that organization already showed signs of strain, “and his sister and more than one of her colleagues on Calveta’s executive team agreed that would  rather save the culture than spread themselves too rapidly into new businesses.

Despite the growth of an aging population, and despite Calveta’s impressive business growth, it seemed highly unlikely to Frank and the executive team that the company could double its revenues in five years unless it branched out beyond the SLF segment.

And despite growth in the hospital sector, Hospitals were, in the aftermath of the 2008–2009 recession, facing cutbacks in equipment and service due to decreases in charitable donations, reduced government assistance, and declining patient-stay lengths. Calveta expected such cutbacks to result in hospital closings, possibly reducing the potential market size.

Frank feared that Calveta’s solid reputation as a leader in the health-care sector might become threatened as its relative size shrank versus the competition.

Considering the financial challenges of getting into the hospital segment, the upbeat angles seemed a bit pie-in-the-sky as Calveta shouldered little debt. Because the company had been able to fuel its growth through prudent cash flow management, it did not need to rely on debt to finance kitchen equipment and renovations. If Calveta chose to pursue growth through acquisition, however, its no-debt philosophy would almost certainly need to be set aside. Calveta’s unique culture also served as an impediment to growth through acquisition.

Lost contracts typically resulted from changes in management at an SLF; only rarely did an SLF drop Calveta citing poor performance. For several years, Frank Calveta had heard about such defections, and he believed that the vice president of account management had been dealing with them effectively. But when he’d begun reading the company’s annual client satisfaction survey results from the perspective of the CEO’s chair, Frank recognized that client frustrations with employee progression policies had worsened.

Frank felt that the organizational structure of the firm was partly to blame for the customer dissatisfaction. While he’d been CFO, Frank had expressed concern that the design of the organization might have gotten knocked out of alignment as the company grew, but little had been done as Jennifer, speaking as COO, had disagreed with Frank. But Upon reading the latest surveys, Frank decided to have another look at the company’s organizational chart.

Frank also worried about a rising diversity in the skills of area and account managers. It was becoming harder to find operations managers who fully embraced Antonio’s Way which can pose a problem in maintaining core values of the organisation. Recent development in the organisation has posed a rising diversity in the skills of area and account managers and new joinees lacked the industry experience.

As per Jenifer, GSD from Great Southwest don’t have the best reputation. They’ve had labor problems and substantial turnover in their management ranks.  However, Frank was confident that maybe Calveta’s best managers could slowly move GSD’s culture toward Antonio’s Way.

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Probable solutions based on the root cause to solve the problems:-

Looking into scenario and objectives of the organisation, Calveta must opt for expansion of its business in different business segments particularly hospital segment as they are leaders in health segments. As the statistical data also proved that there is a sharp increase in aging population and 75 % market remained untapped. So Calveta must exploit this opportunity and target to achieve the goal of doubling its revenue in five years. Though Company have had no debt in its financial structure but in order to ensure its growth and expansion plan they must lever its financial structure and take advantage of reputation of company in getting debts from the market. Instead of hiring fresh graduates, company should focus on hiring those candidates who are ready to work in ANTONIO’s way, a work culture set by the founder of the company and the company should train them accordingly in order to maintain in reputation in the market. The company should go for acquisition of GSD as this company can help in expansion of the business in great southwest, the place where Calveta is not operational. The problems of labor problems can be sorted out by hiring competent employees and training them to cater the needs of company.

Adidas Marketing case study solution: Adidas Marketing mix, Adidas website SMART Analysis, Adidas SWOT Analysis, Adidas Brand Identity, Adidas Digital Marketing Communication, Three Adidas Collaborations, Adidas Brand Elements & Evaluation, Adidas Brand positioning, Nike versus Adidas Brand comparative analysis

 Case Snippet: 

Identify and evaluate the strong and weak features of a website as marketing tool of a given company

Identify and describe the targeted customers group/s of a given company

Examine branding strategies of a given company (Adidas)

Explain the brand image, brand identity and brand relationship of a given company (Adidas)

Case Questions:

Part A:

1. Identify and evaluate the strong and weak features of a website as marketing tool of a Adidas company.

2. Identify the customers being targeted by the website of Adidas by explaining with suitable evidence and examples. Describe one of the groups being targeted.

Part B

1. Identify how Adidas brand is currently expressed in the company website of Adidas you have chosen. Evaluate elements used to assemble the brand.

2. Explain the brand image of the company (Adidas) you have considered. Is there a gap between your brand image and the brand identity which is portrayed on the website? Explain your reasons.

Marketing Mix of Adidas Website 

SMART Analysis for setting objectives of website of Adidas 

SWOT Analysis of website of Adidas Adidas 

Digital Marketing Communication 

The three Adidas Collaborations 

Brand Element of Adidas 

Evaluation of Brand elements on Adidas website 

Brand positioning of Adidas on website 

Adidas Brand Identity

Nike versus Adidas Brand comparative analysis  

1. Identify and evaluate the strong and weak features of a website as marketing tool of a Adidas company.

About Adidas	·         Founded in 1949, Adidas AG is the largest sportswear company in Europe and second largest in world. ·         Revenue € 23.6 Billion and net profit € 1.9 Billion (2019).
Brand Mission	To become best sports brand through design, build up and sale of best sports products with best service and experience to its customers.
Products	Athletic shoes, apparel and sporting goods and accessories.
Website	www.adidas.com
Reasons for selecting Adidas	Adidas is a multinational company engaged not only in offline sales but also through its website. Analysis will be more goal oriented and specific for this assignment.

Marketing Mix of Adidas Website

Online Product

Products are categorised on the basis of men, women, kids and sports shoes, clothing and accessories. Customisation of products is also offered by the website. Products have also been displayed brand wise. Features, description and all other necessary information on products along with product images have been exhibited to keep customers informed to meet their expectations. Mega offers and discounts are being displayed on first page of website.

Online Price

Price of all products is mentioned along with products.Customers can navigate through website and search products of their choice, add products to cart, order online and also cancel the order anytime before product is dispatched directly using the website.

Discounts and offers are being displayed along with product display. Method of payments offered on website is through pay on delivery, credit & debit card, net banking and other UPI apps. Option of payment in instalments is also offered to customers through EMI.

Online Place

Products are being shipped to all parts of the country including remote areas. Website has also option to order online and pick products from stores for its customers. Billing address and shipping address can be same or different as per the choice of the customers. Products are generally shipped and delivered within 3 to 15 days of time. In case of customised products delivery time ranges between 1 month to 3 months.  Website also offers fast / emergency delivery system but charges extra for the same on request of the customer. Products are being shipped through courier partners of Adidas.

Online Promotion

Adidas has dedicated team of SEO, SMO and web developers and designers to manage its website. It uses Google analytics tools and other web tools to keep an eye on traffics, returned customers, customers who have added products in cart but not purchased. It regularly conducts online survey to enhance customer experience on its website. It makes use of Google paid services and Facebook paid services to promote its products online. Company performs press release on regular basis and also offers feedback and product review option to customers to improve customer interactivity and experience on website.

Target Customers & Intended positioning

It targets young adults, adults as well as children who have passion for fitness & sports in the age group of 13-40 years but majority of its customers are of 15-30 years of age who hail from upper middle class or the luxury class of customers

SMART Analysis for setting objectives of website of Adidas

Specific	·         E commerce sales to rise by 35 % in 2020 with revenue target of 4 Billion Pound. ·         Reduce delivery time by 2 days for normal orders and 7 days for remote areas within 6 months. ·         Shorten period of customised products delivery by one fourth time than current time period within one year.
Measurable	·         Adidas maintains customer relationship management software to track record of sales, tracks new entrants on website initiating purchase, tracks shipping and delivery time period and has vendor management system to track record of manufacturing and delivering customised products and other products.
Attainable	·         It has speed factories which can help to reduce manufacturing time of customised products. ·         Efficient courier delivery management system and inventory management can help to reduce shipping period in remote areas and normal orders. ·         In 2019, E Commerce revenue sales were up by 34 %.
Realistic	·         Reducing shipping time will help Adidas to beat its competitor Nike. ·         Increase in E Commerce sales will help Adidas to achieve its overall sales growth of 8 % in 2020. ·         Reduction in time of delivery of Customised products will help it to become global leader in the sporting goods industry which is ultimate mission of Adidas.
Time-based	Increase in sales revenue is targeted to be achieved within one year, shipping period for normal and remote areas to be 6 months and decrease in delivery time of customised products to be achieved in one year time frame.

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SWOT Analysis of website of Adidas

Strength	Dedicated team to manage the operations of website to enhance customer experience. Order online and collect from store. Easy Cancellation of order and refund of money even after shipment. Return of product within 30 days. App to support browsing and conduct purchase through smart phones. Prompt Online customer support to help on queries of customers. Content updates on regular basis. Detailed information of products.
Weakness	Longer delivery time in remote areas. Long waiting time for customised orders. Delay in delivery of products.
Opportunity	Tapping of new markets and customers in areas where Adidas is not physically present. Design and development of innovative products to attract more and more customers.
Threats	Competitors like Nike have also entered into E Commerce and offering customisation. Local laws such as varying tax policies prevailing in other countries with regards to E Commerce. Customers’ can’t review products on thee website.

 Adidas Digital Marketing Communication

Informativeness

Website contains adequate information on products being displayed and are regularly updated to enhance customer experience.

Usability

Navigation on website is very easy from point of searching a product to check out. Process has been kept very simple to avoid confusions and anxiety while navigating from one product search to another.

Quality of information

Information on website is apt to its users as it shares minute details regarding manufacturing material to its delivery to the customers.

Commercial transaction

Website offers easy to process order, make payment either online or pay on cash, delivery tracking mechanism and easy to cancel order, get refund and return policy of 30 days.

Company policies

Price inclusive of taxes is being displayed on website. Packaging and shipping are free of cost.

Business Environment

China US trade war and US imposition on tariffs can have negative impact on sales.

Web Based Commercial Communication

Interactivity

Online chat support to offer two way communications through website.

Creators club membership program to strengthen relationship with customers.

Flexibility

Cancellation of order anytime, change of shipping address, replacement of products, and return within 30 days of purchase is some of the features to promote flexibility.

Addressability

One to one support to its customers through online support, emailing to update on new products and offers, customisation of products to offer personalisation to its customers.

Accessibility

Website remains operational 24x7. Online Chat support is available during office hours. Orders can be placed anytime.

2. Identify the customers being targeted by the website of Adidas by explaining with suitable evidence and examples. Describe one of the groups being targeted.

Adidas through its website uses demographic and psychographic market segmentation to target customers of its products. Being a sports products company, it targets male and female customers of age between 14 to 40 who are athletes and fitness freak. The company is focused on targeting and strengthening its brand with the next generation of athletes of age of 14 to 19 years. However, Adidas is also popular among people of age between 40 to 65. It offers different sub brands to target different customer segments like Adidas Originals, Adidas Neo, Porsche design, Stella McCartney.

Psychographic segmentation is based on socioeconomic and personality variables of customers which are done using Niche pricing strategy and superior quality products of Adidas. Thus it targets upper middle class consumers to affluent consumers by premium positioning of its products among consumers.

To target its customers it has defined a segmentation grid which comprises of comprises six key quadrants Male Athlete, Female Athlete, Young Creator, Street wear Hound, Amplifier, and Value Consumer. Within this grid, it is key to win the most influential consumers, defined as the creator archetype. Major categorization of products have been done on the basis of male, female, kids and A separate sports category with on the website directly targets athlete customers to navigate products in that section. Navigation on the basis of male, female and kids category is meant to segment customers in small group on the basis of gender and age to target customers who are into sports or fitness lover.

Exploiting opportunity of  changing social proposition of and growing culture of remaining fit and healthy, Adidas website is targeting customers of all age groups by displaying products under Male, female and kids category. Product display on the basis of brand categorization is done to easily locate the product and prompt buying decisions. Brand such as Adidas NEO is meant for kids products which are price competitive in market. Customisation of products offer competitive advantage as well as company’s thrust to remain innovative and create best and new as per the requirement of the customers to remain customer obsessive and offer great experience to them.

Potential Barriers Adidas Company is facing in implementing its idea:

·         Pricing issue- Products of Adidas are expensive.

·         Stiff competition from its rivals such as Nike, Armour, Puma.

·         Availability of Fake and duplicate Adidas products in market.

·         Delay in delivery due to shortage of inventory

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Part B

1. Identify how Adidas brand is currently expressed in the company website you have chosen. Evaluate elements used to assemble the brand.

Expression of brand on company website:

Adidas Brand

To be best in world in sports brand through design, build up and sale of best products and services empowered with advance technology and innovation to share best consumer experience.

Brand Identities:

Adidas Sport Performance

Focus: Products with advance technology and innovation

Group targeted: athletes and sports persons with a desire to remain strong smart, cool and excellent in their performance. It also targets customers who are inspired by fitness and sports.

Adidas Originals

Focus: Products that set trends including life style products.

Group targeted: consumers willing to express their individuality.

Adidas Neo

Focus of Adidas NEO:  Stylish, fresh and young Products related to sports, Fashion and Lifestyle

Group targeted: Teenage consumers between 14 to 19 years.

The three Adidas Collaborations

Y-3, Porsche Design, and Stella McCartney focus on extraordinary products aligned with most updated technologies and top fashion designers.

Brand Element of Adidas
Criterion	Brand Name & URL	Logo & Symbol	Characters	Slogans & Jingles	Packaging & Signage
Memorability	Easy and simple to memorise and recall.	Three stripes logo with Adidas tag is appealing helpful in easily recalling products of Adidas.	Useful in recalling brand name and its products.	Helpful in recognising brand	Makes easy to recognise products of Adidas.
Meaningfulness	Strong, positive and high quality	Represents sports challenges athletes face.	Performance based products as tools to face challenges	Convey mission of Adidas to become best sports brand in the world.	Convey association of brand with its customers.
Likability	Offer verbal imagery and mission of brand.	Three stripes using black and white colour depicts simplicity and likability.	Depicts boldness and strength.	‘Impossible is nothing’ enhances motivation of customers specifically sportsperson.	Energises customers through its visual and verbal appeal.
Transferability	Easily transferable through sub brands inclusion.	Smart and excellent.	Unlimited additions in product ranges.	Promotes innovation and implementation of technology to adapt changes	Very good.
Adaptability	Difficult Near to impossible.	Modified multiple times in the past to adapt changes.	Responsive brand in redefining itself.	Modified to meet new requirements.	Redesigned multiple times in past.
Protectability	Fully protected through acquisition of domain name	Fully protected through trademarks and copyright registration.	Strong, excellent and comprehensive.	Protected through copyrights.	Can be copied.

Evaluation of Brand elements on Adidas website

Memorability

Since name Adidas has been derived from its founder, Adi Dassler a strong, versatile, enthusiastic and top quality shoe maker, the brand also depicts these three features accompanied with innovation and technology. The three striped with black and white logo along with its website name is not only easy to remember but also simple and catchy.

Meaningfulness

Brand logo signifies challenges and products displayed on website are considered as tools to overcome those challenges by athletes and fitness lovers.

Likability

Brand likability through website is visible through increase in its E commerce sales by 34 % in 2018. Also Logo of brand characterises boldness and strength to the consumers’ thus increasing likability.

Transferability

Website can easily incorporate sub brands and new products as per the design and resemblance of features into it, thus reflecting easy transferability through technology and innovative products.

Adaptability

Website URL may not be modified, however website is adaptable to changes to environment. Adidas logo went through multiple modifications since its inception and its mission supports adaptability.

Protectability

Adidas has copyrights and trademark rights for its URL, Logo and slogans & patent rights for design of products and products. Hence company has protected its brand elements in all respects.

 

4. Explain the brand image of the company you have considered. Is there a gap between your brand image and the brand identity which is portrayed on the website? Explain your reasons.

Adidas Brand identity
1. As a product	Product Scope- to cater needs of athletes, sports persons and health & fitness freak at competitive price. Product attributes- innovative design to match customer expectation, long lasting, customised, size fit for all, eco friendly raw material used, Quality- Unmatched quality embedded with innovation and advance technology sports products much ahead than its competitors. Users- athletes, fitness and health conscious people of age group between 14 to 65. Uses- fitness and sports apparels shoes and accessories to deliver high performance in sports. Country of origin and year of establishment- Herzogenaurach, Germany, 1924.
2. As an organisation	Organisation attributes- To deliver most innovative and best technology sports products to offer best consumer experience with a motive to become best sports brand in the world. Local versus global- Multinational brand with presence in more than 160 countries worldwide physically and all around the globe through its Ecommerce website and distribution network.
3.Brand as a Person	Personality- 1. Sincerity- Real, original, honest, genuine 2. Excitement- Daring, trending, imaginative, independent, unique, adventurous 3. Competence- Reliable, successful, technical, confident, and efficient 4. Sophistication- Upper Class, smooth 5. Ruggedness – tough, strong. Brand Customer relationship - committed to providing premium retail experiences to consumers with executions that connect, engage and inspire them. Brand strives to build a strong image, trust and loyalty with consumers through its brand strategy of ‘creating the new’.
4. Brand as Symbol	Visual imagery & metaphors – Providing strength to accept challenges and overcome it. Brand heritage – Long lasting heritage with high brand value in market. Brand is 95 years old.

Brand positioning of Adidas on website:

Messages transmitted:

Product- Most innovative and best technology based sports shoes, apparels and accessories to offer best consumer experience.

Price- Competitive pricing for normal product launches and skimming pricing for unique and technologically advanced product launches.

Place – Shipment and delivery of products in all parts of the world including remote areas to create trust and loyalty among customers.

Promotion/ Communication- Slogan of Adidas ‘Nothing is impossible’ rejoice consumers’ strength and empower them to overcome challenges and encourages them to become effortless in what they do. It portrays itself as a creators’ sports brand through its website Regular discounts and offers are made to customers on the website to increase sales and web traffic.

Nike versus Adidas Brand comparative analysis

The major competitor of Nike on E Commerce Platform is Nike. Both more or less follow similar branding strategy to lure customers but Adidas has leveraged the Internet and E Commerce marketing and sale more aggressively than Nike. Nike’s Ecommerce strategy created a strong brand position of its products and leader in this market contributing to its success in this market. However, Adidas has revamped its branding strategy from being a minor insignificant player during 1998 to reach to second position in the industry. Thus, it can be said that Adidas has really worked hard in strengthening its brand position in market through its continuous effort of designing and developing innovative and highly advanced products for its consumers to win their heart and maintain long lasting relationship through enhancing customer experiences.

Brand image of Adidas as perceived by consumers

Adidas through its website and E Commerce business has been successful in understanding the customer’s needs and design and development of innovative and technological products that suits their requirements. Adidas has been continuously accelerating on graph of having strong brand equity among customers in terms of an innovative, reliable, brave, tough, independent, daring trending and unique brand delivering promising and long lasting sports products to customers.

Gap between Brand image and brand identity:

Adidas fails in portraying itself as a company whose pricing is competitive among rivals. Local competitors can exert tough competition when it comes to target customers who seek low pricing with similar features. It will become difficult to target those customers who decide their buying decisions on the basis of pricing of products. Hence company should also focus on manufacturing products to cater needs of such customers in order to remain competitive in market. 

Reference

Adidas Group. (2019). Adidas Annual Report 2019. Retrieved from https://report.adidas-group.com/2019/en/group-management-report-our-company/corporate-strategy/sales-and-distribution-strategy.html

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Adidas Group (2019). Adidas Brand Strategy. Retrieved from https://report.adidas-group.com/2019/en/group-management-report-our-company/corporate-strategy/adidas-brand-strategy.html

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Julia Wildfeuer (2018). Branding and Customer Satisfaction: A Research about the Adidas Group. Novia University of applied sciences.

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