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Mkt de Beers Case Study

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Submitted By ottiligeas
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Case Study 2

A case study submitted to Webber International University
In partial fulfillment for the Bachelor of Science degree in Business Administration

By: Amber S. Ottilige Date: Apr. 20, 2014 Course: MBA683 International Logistics Management Semester: Spring 2014 Instructor: Dr. Schwarze

When a company chooses to expand or to grow, there are many goals and objectives for the company to fulfill before expanding and growing. These goals and objectives can be large or small for the company. The main reason for them is to have the company grow in the future successfully. For these goals to be achieved, the company needs to implement different strategies to help the company grow as a whole. These strategies will help the company achieve the goals and objectives and also help with any future goals and objectives for other future growth of the company.

De Beers Diamond is a private cartel of companies that dominate diamond and the diamond mining industry and also the diamond trading sectors around the world. The founder of De Beers Diamond Company is Cecil Rhodes in 1888 with their headquarters located in Luxemburg. The company serves the entire world for trading and shipping diamonds, but actually the mining is done specifically in Botswana, Namibia, South Africa and Canada. De Beers Diamond has many top gem and jewelry competitors, which are Tanishq, Nakshatra, Ddamas, Tiffany and Company, and Leviev. The company has been known for being a monopoly over the entire diamond and diamond mining industry, which are usually frowned upon around the world. Another problem with the company is certain controversies that have occurred within the African mining locations. In these locations, there have been many incidences where diamonds are mined and sold for weaponry or for insurgencies, which are usually led by certain militias and illegal cartels in the specific areas. These specific diamonds have a specific name, which are called blood diamonds, because of the bloodshed occurring while mining for these precious diamonds.

Before De Beers continues to expand their diamond mining process, the company needs to assess their current diamond mining process and see what needs to be done differently. Conducting a SWOT analysis of the De Beers Diamond Company entirely can easily do this. A SWOT Analysis is a marketing tool that analyzes all the different aspects of a company. The aspects that are focused are on the company’s’ strengths and weakness internally and the external opportunities and threats that can affect a company in the near future. After conducting this analysis, a company can see whether making a certain decision or implementing a certain strategy might be positive for the company or a negative avenue for the company to venture towards. Below is a chart that shows exactly the different strengths, weaknesses, opportunities, and threats that are both internal and external to the company:

| | Strengths | 1. De Beers employs around 20,000 people worldwide 2. The company is one of the biggest companies in the diamond industry, mining, trading and manufacturing 3. Offers only premium diamond jewelry, which includes necklaces, rings, bracelets, gifts etc 4. Strong brand name and brand equity worldwide 5. De Beers is known for its association with international celebrities 6. Excellent branding and marketing, which makes it a top-of-the-mind brand | Weakness | 1. Strong competition from other brand, which leads to limited market share growth 2. Preference of people choosing gold over diamond | Opportunities | 1. The company can increase its presence in global markets 2. Acquisition of smaller businesses to increase brand position | Threats | 1. Trends change quickly, which leads to innovations and R&D investments 2. Economic fluctuations, which means people decrease their amount of spending 3. Government policies, taxes and so forth also affect the premium jewelry segment of the world |

As for De Beers Diamond Company, there are more strengths and opportunities than weakness and threats against the company. This will show that the company has a strong foundation of having the ability to move forward over time. The strength of having strong brand name and equity will be a large strength for the company. De Beers should look into finding other locations for mining diamonds and other precious gems worldwide.

Reference

Cadieux, D. (n.d.). De Beers and the Global Diamond Industry. Moodle Article. Retrieved April 20, 2014, from http://wiuworld.org/mod/resource/view.php?id=134150

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