Quaker Oats Company Competitive Advantages

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Table of Contents

Introduction
Quaker Oats Company
Market segmentation
Conclusion
References

Introduction

Quaker Oats Company is the leading supplier of food and breakfast cereal products in the US. The company has a long history, dating back to as far as 1901. In the current competitive markets, market segmentation is one of the strategies which can ensure that the company positions itself well so that it improves its level of profitability. This paper analyzes how market segmentation can give competitive advantage to Quaker Oats Company.

Quaker Oats Company

Business organizations aim to make a profit and increase their share of the market by making quality goods and services and by ensuring product availability to customers. Quaker Oats Company is not an exception; making a profit, and increasing the share of the market remains the company primary objective.

To make a profit, Quaker Oats Company aims to satisfy market demand by employing skilled people to make quality goods. Reference for Business (2012), states “we plan to do this by making Quaker Oats a winning company, a place where talented people have opportunities” (para. 1). It is not enough to make quality products, consumers must access products where they live and work.

In addition, Quaker Oat Company must make products for which consumers desire to buy (Reference for Business, 2012, para. 1). Looking at the future, Quaker Oats Company, must define its current market, cultivate future consumers, make quality products, and carry out an aggressive campaign to market its products.

Market segmentation

The first step at increasing market share involves determining the market segment to target and focus resources to that market. Business Dictionary (2012) defines market segmentation as “the process of defining and subdividing a large, homogenous market into clearly identifiable segments having similar needs, wants, or demand characteristics” (para. 1).

The market appears homogenous, but when studied differences emerge based on age, consumer preference, location and income. For Quaker to succeed, it must segment the market and focus at satisfying the need of the market it chooses. Segmenting a market has the advantage of enabling an organization to satisfy consumers’ needs, and a result, develop a competitive advantage.

Based on the nature of products manufactured and sold by Quakers Oat Company, its management must segment the market in three ways based on income, family type, and lifestyle. Income determines a person spending power; it enables marketers to determine the people to target.

In addition, income segmentation affords Quaker Company to price and package its products in sizes attractive to a target market. When segmenting the market for housing, clothing, automobiles, and food marketers must use income segmentation as a tool to determine potential consumers (Lamb, Hair, & McDaniel, 2011). Another way of segmenting a market involves determining potential consumers based on family type.

Some potential consumers are single; others have families with children and some are retirees; family type determines spending priorities. People of the same age and gender have different spending habits depending on the family type they have (Lamb, Hair, & McDaniel, 2011). Quakers Oats Company can use geographic segmentation to design marketing strategy; this involves grouping consumers based on where they live.

Quakers Oats Company faces competition from two oats manufacturers; Blue Lake Milling of Australia and Savour Company of India. Blue Lake has a competitive advantage because it has a policy of ensuring quality raw materials by enforcing a traceability policy. Blue Lake (2012) claims “grain buyers’ work closely with Australian cereal growers to ensure the production of high quality grain…” (para .2). Savuor of India manufacturers white oats (Savour, 2012).

Quakers Oats Company must enhance the production of whole grain oats for health conscious consumers. The company location in the United States gives it a competitive advantage it has to utilize to increase market share. Managers must develop a marketing program to popularize Quaker’s products; it includes shelf display and the electronic media advertising. Finally, to stay ahead of the competition the company must design improved packaging, develop unique oats blend and focus on health conscious consumers.

Conclusion

Differentiation through market segmentation is therefore a successful marketing strategy if applied effectively. Hence, Quaker Oats Company can gain competitive advantage in the global market if it builds a favorable image by successfully segmenting its market so as to meet the needs of similar customers.

References

Business Dictionary: Market Segmentation. (2012). Retrieved from www.businessdictionary.com/defination/market.segmentation.html

Blue Lake Milling: The Journey for Your Rolled Up Oat. (2012). Retrieved from www.bluelakemilling.com.au/rolled_oats.html

Lamb, C., Hair, J., and McDaniel, C. (2010). MKTG4 2010: A Student – Tested Faculty Approved Approach to Learning Marketing. Mason: Cengage Learning.

Reference for Business: The Quakers Oats Company – Company Profile, Information, Business Description, History, Background Information on The Quaker Oats Company. (2012). Retrieved from www.referenceforbusiness.com/history2/41/The-Quaker-Oats-Company.html

Savour: White Oats. (2012). Retrieved from www.savourindia.com/white-oats.html

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Quaker Oats Company Competitive Advantages

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