Mkt630 Assignment No. 2
Saturday, January 15, 2011 Posted In Mkt Edit ThisInternational Marketing (MKT630)
Assignment No. 2 Marks: 10
McDonald’s! Coca Cola! Disney # a powerful alliance
A strategic international alliance (SIA) is a business relationship established by two or more companies to cooperate out of mutual need and to share risk in achieving a common objective.
Strategic alliances have grown in importance over the last few decades as a competitive strategy in global marketing management. SIA are sought as a way to shore up weaknesses and increase competitive strengths.
Today business is being driven by two fashionable ideas: globalization and core competences. The first compels companies to look for ways to sell their product in as many different places as possible, which often requires other people to help them. The second, the fashion for a firm sticking to what it does best, means that they must often let outsiders help them with everything
else.
The ties binding Coca-Cola, McDonald’s and Disney vary enormously.
McDonald’s Disney
In 1997 McDonald’s and Disney began a formal 10-years alliance. The first specific outcome was a Disney film, Flubber, whose box-office returns were help by the tie-ins at McDonald’s. In July 1998 a promotion started of Armageddon, a $111 million film starting Bruce Willis, with McDonald’s selling tickets and special ‘Astromeals’ at each of its 23,500 restaurants worldwide.
This time the target was not children but young adults—a market in which McDonald’s is weaker.
McDonald’s Coca-Cola
This alliance has not formal agreement—no piece of paper to fall back on. Although Coca-Cola sells drinks to other restaurants, its relationship with McDonald’s goes far beyond that of a mere supplier. It has helped its parent to set new operations around the world. Coca-Cola is sold in almost twice as many countries as McDonald’s.
Coca-Cola Disney
Coca-Cola’s ties to Disney are probably the weakest of the three— but they are still considerable. Coca-Cola has been the sole provider of soft drinks at Disney parks since 1955, and it has had a marketing alliance in place since 1985. Coca-Cola has also helped Disney overseas.
Question:
Which factors could make the alliance of Coca-Cola-Disney-McDonald’s break up?
(Please write your answer in bullets. Your answer must not exceed 250 words)
Sources:
1. Hollensen, S. (2007). Global Marketing: A decision-oriented approach, 3rd edition, Prentice Hall, London.
Schedule
Opening Date and Time 11th January 2011 At 12:01 A.M. (Mid-Night)
Due Date and Time 14th January 2011 At 11:59 P.M. (Mid-Night)
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SOLUTION:
Pitfalls of strategic alliances:
There are many reasons that contribute towards the failure of strategic alliances. International markets need to avoid the following issues in the case of forming strategic alliances;
• Incompatibility of partners
• Issues in having access to each other’s information
• Disagreements over distribution of earnings
• Issues due to potential loss of autonomy
• Changes in motivations due to changing circumstances over time
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SOLUTION:
Pitfalls of strategic alliances:
There are many reasons that contribute towards the failure of strategic alliances. International markets need to avoid the following issues in the case of forming strategic alliances;
• Incompatibility of partners
• Issues in having access to each other’s information
• Disagreements over distribution of earnings
• Issues due to potential loss of autonomy
• Changes in motivations due to changing circumstances over time
