Telefonica

Telefonica’s rapid expansion into Latin America can be contributed to the fact that the company seeks to spread its footprints in another continent in view of the level of dominance of other telecommunication players like Vodafone.  For this reason, Telefonica would pride itself as a major company in Latin America. In a country like Brazil the company makes good profit thereby giving it an edge above the rest of their competitors.

The move is also in line with the company’s geographic segmentation since it was able to identify the Latin America as a major target market they intend to exploit because of the available opportunity within the market. The expansion also comes as a result of the willingness of the Latin Americans to get a better network that will effectively address their need for communication.

In a bid to effectively meet its target market, Telefonica management has to divide the target group into subsections through which communication channels can be followed.  The segmentations were done in line with the company’s objectives of the marketing team.

The first segmentation is geographic segmentation. The company uses this type of segmentation to identify the location of the business. The strategic direction of this business segment is seeking to move to other countries around the world in order for Telefonica to meet its desired goal for expansion into other markets around the world. In addition, the geographic segmentation enables Telefonica to know the location the company will be able to start off its operation within the market and the kind of strategy to come up with in meeting the needs of the target location. It a common idea that every location may affect the business either socially or politically thus Telefonica has to tread carefully in a bid to know how effective it will be able to meet the needs of the desired product.

Size segmentation

In view of its previous performance and markets that Telefonica has covered, the company is in a position whereby it is capable of attracting more customers based on its size. Size depends on the various sales the company has done in other locations and the number of locations from which it operates. This will help in determining the level of attraction of potential customers within the market and the potential sales the company is likely to make. The company will therefore have to come up with a chain of communication through which the company will have to decide on the person who will do most of the communication with the target market.

Another segmentation that Telefonica has to undertake is business segmentation. Through this segmentation, the Telefonica will be able to identify companies that go past the size, industry and geography within the market. In addition, the Telefonica marketers will have to identify the companies that deal will cabling services and communication boosters to help them be able to set up in their target market. This will help see the company set up fast and be able to start off the operation towards meeting the desired goal in its set objectives.

Segmentation through industry enables Telefonica’s marketers to sell their communication products to the segments available in the communication industry.  Telefonica adopts this strategy and considers it a way through which they can partner with the companies that manufacture a number of components they will need for their operations. Telefonica management considers using this segmentation for purposes of planning because through the businesses that it works with, it will be able to get information on various markets and be able to plan appropriately.

There are number connections among Telefonica’s business segments. To begin with, segmentation through industry and business segmentation are closely linked since the company will have to plan on the manner it will be able to undertake its business within the market it operates. This connects the business segmentation and the industry segmentation in the sense that Telefonica will first have to identify the company it will be working together with in ensuring that its operations move seamlessly. A company that undertakes cabling services partner with the management in knowing the standards that are used in the market they are targeting. This goes hand in hand with the industry segmentation because having got a company through the desired business segment; they can also get a company that will help them get the required materials they will need to use in their operation.

Telefonica’s geographic segmentation and business segmentation have an operational connection in view of the fact that the company has to decide on a location that will be best for its operation with the company it seeks to work with, in the new environment. In addition, Telefonica management will have to plan on where to carry out the operations that will best suit the general operations between it and the company it seeks its services. Determining the location of company comes after thorough survey and determining other factors in between like social issues. This for instance will enable the company be able to know the sensitive issues that a surrounding community may have to business environments without which the company will have difficulty fitting in the desired market.

On the other hand, geographic segmentation and size segmentation do not have any operational connection in the sense that the company does not have to determine its size in a bid to identify the appropriate geographic location where it will be operating in the new market.  Moreover, the size of the company does not depend on the location since the size is mainly a factor that is determined by the general operations of the company. The size depends on factors like the level of demand of the service and the general strategy for expanding to meet the targets set out in the market.

SWOT analysis and value chain for Telefonica’ business segment

Telefonica has a strong presence in Latin America and therefore the likelihood of it having a high number of clients especially from Brazil where it was widely received positively. The company also knew that the demand for telephone services in the Latin America would rise in Latin America thus a great opportunity within the continent.

Telefonica has a greater advantage above the other telephone services companies available in the Latin America market. In view of the fact that it has better managerial, technological equipment and capital, puts it in a better position.  This also gives it a competitive advantage above the rest of the companies and thus a greater opportunity for it to succeed more in the market. Based on the cultural ties that are shared between Latin America and Spain, the company will not have a hard time fitting in the environment since the management understands the culture of the Latin Americans more so the manner they undertake their businesses.