American Girl – Growth Strategy Thesis Proposals Example

American Girl is a wholly-owned subsidiary of Mattel Inc. and was established in 1986 to celebrate girls. All the products allow a complete, fun-filled package for girls. Its product diversity has been a celebrated factor as American Girl has made sure that there is ‘A Doll for every girl to Love’ (American Girl, n.d.).
It has grown exponentially and has become a noticeable brand for girls of ages 3 years and up. 21 retail outlets and continuing international growth are important features of the growth pattern adopted by American Girl (Mattel, 2013).
This paper is an evaluation of the current growth strategy of American Girl and aims to highlight the alternative best value discipline, generic strategy, and grand strategy that could boost the growth of the organization and develop the perfect mix of strategies that would help to continue the growth pattern.

Best Value Discipline

The best Value Discipline for an organization defines its strategic focus in establishing a competitive edge. Out of the three value disciplines - operational excellence, product leadership, and customer intimacy – American Girl falls in the third category. Customer intimacy value discipline requires that relationships are built by satisfying specific customers; long term profitability is evaluated rather than that of a single transaction. Customer data is readily recorded and analyzed to train the sales force to create focused marketing efforts on each consumer niche (Johnson, 2010).
The niche selected is that of girls – focusing on the qualities that define them today and what they will become tomorrow. The basis of market power for American Girl has mainly been customer loyalty. Millions of girls have become loyal to the toys, books, clothing, accessories, and activities that American Girl offers throughout its retail outlets. Parents and educators trust the brand to aid in their developmental efforts and to shape a bright future for the girls. Multiple channels – catalogue ordering, online stores, and physical retail stores – facilitate customer access and customization efforts such as the introduction of My American Girl - that allows girls to custom design their dolls – allows for one-to-one customer relationship development (American Girl, n.d.). Once the value discipline of the organization has been identified, the narrowed generic strategy can be discussed.

Generic Strategy

Identifying the perfect generic strategy that supports growth is dependent on the profile of the organization. Porter’s generic strategies relate to cost leadership – having the lowest cost in the market, differentiation – offering a product with features that stand out in the market, and focus strategy – focusing on the needs of a specific target group (niche) in the market (Griffin, 2015). Considering that the niche market of young girls is catered by American Girl a generic strategy combining differentiation and focus would help in the growth of the company.
Differentiation from other girls’ toys and clothing brands could result through the exclusive experience of being an American Girl. Events and shows that focus on girls’ interests and options, such as customize your doll, help to differentiate the product offering and hence, increase the customer base. Focus strategy has already been in use by American Girl as the specific niche of girls - ages 3 and up - is being targeted. Further, refining the focus through customized dolls and data collection and analysis on customers helps to develop a one-to-one, long-standing relationship with the customer. Using such a combination strategy can help American Girl to establish a long-term growth pattern.

Grand Strategy

The value discipline shapes the culture and the generic strategy defines the actions that all shape up the grand strategy of the organization. Grand strategy can fall into various categories depending on the corporate objectives, which in the case of American Girl are to achieve substantial growth.
A market growth strategy – most common of all - requires that the current products are introduced into new markets (Clark, 2015). Steps such as selling books and toys at not only its own retail outlets but also in major books and toys stores has become a good growth move for American Girl (Kirch, 2011).
A recent move to the international market by opening a store in Mexico City has defined new horizons of growth for the organization. The grand strategy in place here is that of Market Growth as American girl is now exploring and developing new markets for its existing product range (Mattel, 2013).

Recommended Strategy

American Girl has seen growth in customer base since its inception; however, its corporate objective continues to be an ambitious one in terms of aiming for further growth in revenue and number of customers (American Girl, n.d.). The strategy of the organization, at each level, should be aligned towards this goal. Being a Customer Intimate company, American Girl cannot pursue any one strategy single handedly. A combination of strategies will have to be developed for the organization. The strategies that American Girl can use, in conjunction with each other, are as follows:
Market Growth Strategy – Having completely explored the US and Canadian markets, American Girl should identify that an environmental analysis reveals saturation of these markets. New markets need to be explored and international markets will present a new set of culture and new expectations of consumers. Therefore, new markets will have to be carefully selected and penetrated through modified products and enhanced marketing efforts.
Continued Customer Intimacy and Focus Strategy - American Girl has a strong identity based on the uniqueness of each girl. Continuing this strategy to expand into new markets would require in-depth analysis of the target population. Therefore, intense customer research would form the foundation of the growth strategy that American Girl undertakes.

Conclusion

As analyzed in this proposal, American Girl’s corporate objective of growth can be achieved through a focus strategy that ensures lasting relationships with customers. Customer-based data analysis and the development of a customer-centric approach are the prime principles to be followed. Thus, a grand strategy of market growth is revealed for the organization as it is important to realize that the US and Canadian market have reached saturation point and international markets need to be explored. The thesis will focus on developing a framework for the implementation of these strategies and a detailing of the expected outcomes.

References

American Girl. (n.d.) . In About American Girl. Retrieved From:
http://www.americangirl.com/corporate/corporate-landing?section=about&id=2
Clark, W. (2015). Examples of Grand Strategies in Businesses. Retrieved from http://smallbusiness.chron.com/examples-grand-strategies-businesses-14377.html on April 6, 2015.
Griffin, D. (2015). Four Generic Strategies That Strategic Business Units Use. Retrieved from http://smallbusiness.chron.com/four-generic-strategies-strategic-business-units-use-496.html on April 6, 2015.
Johnson, R. (2010). Three Value Disciplines - Which One Defines Your Company? Retrieved from http://www.4hoteliers.com/features/article/5261 on April 6, 2015.
Kirch, C. (2011). American Girl at 25. Retrieved from http://www.publishersweekly.com/pw/by-topic/childrens/childrens-industry-news/article/47124-american-girl-at-25.html on April 6, 2015.
Mattel. (2013). In 2013 Annual Report. Retrieved From:
https://corporate.mattel.com/PDFs/2013_AR_Report_Mattel%20Inc.pdf