TOWS Research Paper Example | Topics and Well Written Essays - 750 words

TOWS - Research Paper Example The company is listed in LSE and in FTSE 100 index. It has also got second listing in NASDAQ. Internal Strengths The company works with 354 companies of Fortune Global 500; 28 companies of Dow Jones 30, 60 companies from NASDAQ 100 and 33 companies of Fortune 50. Therefore, the international client portfolio of the company comprise of several world renowned companies. The customer centric high quality of the service offered by WPP also adds to its inner strength. Internal Weaknesses The recession phase of 2008-2009 had a negative influence on the operation of WPP. This resulted in poor revenue and constantly shrinking profitability. In 2007, the profit for the year was $1,037.2 million that declined in 2008 by $ 934.2 million and finally it reached $ 819.9 million in 2009. Again, the company’s clients are mainly from the developed nation (US and UK). This results in too much dependency on the developed nations from west. This low degree of diversification enhances business ris k of WPP. External Opportunities Considering the economic growth in the developing markets, the company has an opportunity to diversify its client base and enter in these emerging nations. China is the world’s fastest growing followed by India (BBC NEWS, â€Å"Overview†). Therefore, the Asian nations are developing at a faster rate. The companies in these nations are trying to compete with international revivals and thus WPP can offer them the required expertise knowledge and guidance. As the US economic condition is reviving, the companies are in the process to expand their marketing budget. This will result in more business prospective for WPP. External Threats In the last decade, the companies have realised importance of integrated marketing communication to attract and retain their customer base. As a result they are ready to pay high fees to the ad agencies. This made the marketing communication service sector one of the attractive industries for the new entrants and the degree of competition in this sector has grown a lot (Neff, p.2). This growing competition is a major threat for WPP. Apart from the growing competition, there is risk of double-dip recession in Euro zone (Hannon, â€Å"UN Sees Risk Of Double-Dip Recession As Europe Pursues Austerity†). This disturbs the economic recovery rate in Euro Zone and considering the fear of financial crisis, companies are hesitating to invest in marketing related activities. SO box The high economic growth in emerging market that is resulting in growing demand for international marketing communication as well as the customer centric service offered by WPP reflects healthy sigh of growth for the company in near future. Considering these internal strength of the company and the external opportunity, it can be said that the company has a sound growth prospect in these emerging markets. WO box Though the global market condition is improving but WPP’s poor financial performance can deterio rate its image as a market leader in global marketing communication industry. The company may face problem in raising fresh capital to expand its business in near future because the creditors may doubt about WPP’s ability to repay the loan. This may hamper the growth prospects of the company. ST box The customer based high quality communication service is one of the major strength of the company. This should be effectively used to face the threat from growing competiti