Imaginarium Case Study Analysis

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Manufacturer, Purchaser, Seller and Retailer toy business that sells a wide range of quality and carefully selected toys to children at the best price, with the best customer service, with qualified staff and in a well-located fun atmosphere store.

Company´s Mission: Taking a fun approach to the human development of boys and girls throughout the world. •Company´s Objective: To help children learn, imagine and discover. •Target Market: Kids ages between birth and eight to nine years old. •Product: Wide range of careful selected quality toys (educational, would “play” with children, were not sexist, racist or violent) with content activity area like preschool, games, music, theatre, dolls, manual work, science and nature, professions, movement, etc. •Positioning: The Company was positioned to be the toy store company with the best design stores, qualified personnel that strive for customer´s satisfaction, offering quality products at good prices in the best locations. •Sales Objectives: Increase sales from previous years (does not mention how much). To have an idea, in 2000 fiscal year the retail sales amounted to approximately 34 million euros, with earnings of 2.4 million euros. By 2001 the sales revenue accounted for 33.6 million euros and for 2002 they estimated a growth up to 42.5 million euros. •Expansion Objectives: The Company planned to open 25 more stores outside Spain in 2001 and further 63 in 2002, increasing the number of countries in which it anticipated having stores to 18 by the end of 2002. Also, having 50% of the outlets to be the company´s own stores (readjusted by the expansion drive without mentioning more). Finally, becoming the leading multinational in Europe and to lead our market segment at the international level. •Business Strategy: With the help of the share capital injection develop their own market niche, with a complete, attractive and practically unique business concept. •Marketing Strategy (Porter´s): To be different by creating a fun atmosphere store and adding value to the purchase of the toys (toy experts, imaginarium net, imaginarium club). The main marketing strategy was based on strong marketing support to the stores, extensive catalogues and limited advertising.

MARKET INDUSTRY (Porter´s 5 forces)
Competition: A) National .- small retail stores, B). US .- Toy´s “R” Us, Kmart, Target and KB Toys C).- International .- other retail stores (not mentioned). •Power of suppliers: Imaginarium has a high power of supply due to it´s large volume of sales, stores own and franchises around the world. •Power of buyer: the power of the buyer is low due to the amount of competitors all selling the same toys at approximately the same price. •Barriers to entry: cultural, competition, economic condition of the country of entry, government regulations, taxes, custom duties, lack of qualify personnel in some countries, logistic problems, etc. •Substitute products: sports products.

Parents that spend on toys with annual average consumption of 192.14 euros per child (year 2000).

Tena spent little on advertising and neither did he believe in selling at bargain prices. •Various future growth possibilities.
Whether the company is prepared to support the requirements of the fast expansion (human, financial and IT capabilities). •The website is not working at a full potential and this is reflected on the internet sales. •Spanish market don´t trust purchasing over the internet. •Generate traffic in the website that can conclude with final sales. •Translate the website to various languages in order to adapt to new markets. •Improve the IT capabilities of the company in order to manage the information more effectively. •The IT systems do not cater the growth in terms of stores, products and the new ways contacting the...
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