The Corporate Strategy
From the beginning, with the invention of the world’s first reverse vending machine in 1972, TOMRA is continuously providing the most innovative sensor-based sorting solutions. TOMRA’s strategy is focused on offering customers an increase in productivity and revenues while ensuring the best quality products.
Marketing strategy: Standardized or Adapted approach?
Based on the EPRG (Ethnocentric, Polycentric, Regiocentric and Geocentric) framework, we can identify where TOMRA is located in the global market and what type of strategy (standardized or adapted) they are using.
TOMRA has a Geocentric orientation, in which both the marketing strategy and the product are standardized. In other words, the product planning is made globally and the product is global. However there are some variations of the product (Reverse Vending Machine), depending on the size and type of containers consumed or demanded by the population of the entering market. Given that local sales divisions are the ones closest to the customers observing trends and consumers behavior, they are in charge of sending feedback to the headquarters in Asker (Norway). This is done in order to consider their light adaptations so the marketing mix decisions are made jointly.
For example, when TOMRA launched in the German market, they realized that they had to improve the machine by adding new features specific to that market. The result of this improvement was a new combined machine, which could not only handle bottles and cans, but crates as well. This is different from the Norwegian market, due to the fact that German consumers usually buy a higher quantum of beverage containers, which often implies crates.
As mentioned before, TOMRA uses a standardized approach. Comparing the strategy that uses between Norway, Costa Rica and Chile, the only difference is that in foreign markets, the company uses distributors to sell the machines, in contrast with Norway that it sells directly to the customers.
Marketing strategy in Peru:
In order to have a successful entry to the Peruvian market, we highly recommend to TOMRA to conduct a Study Research (investment in R&D) of all the types of containers which will be collected by the Reverse Vending Machines. This is because in the market there could be different types and sizes of containers that may not fit in the machines. With the information collected, the company will continue with its standardized product with necessary and slight adjustments if needed.
Regarding the message, TOMRA is communicating the same idea all around the world. However, this message is weighted differently according to the specific needs within each market. It should therefore be considered given that:
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The Peruvian Environmental Ministry is promoting the recycling culture.
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The rate of recycling in the country is very low.
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There is no direct competition in the Reverse Vending Machine industry.
TOMRA has to take advantage of the situation and enter the market as soon as possible to get the first-mover benefits. They don't have to create the need of recycling, since as the points stated before demonstrate that it is already latent. However they also have to sell the opportunity for the customer (as we will explain in the Segmentation section, the supermarkets) of increasing their business as well as improving their brand image by buying the Reverse Vending Machines. Moreover, in regards to the end user (citizens) we recommend TOMRA to carry out some advertising campaigns to increase product awareness, which will be detailed in the Action Plan section. All of these ideas would become easier for TOMRA if they enter a partnership with the Government. This is a key point for TOMRA to expand their message and get more bargaining power when approaching potential clients.
With the next graph we want to clarify all the agents and relations that are involved in our strategy:
Once the Reverse Vending Machines are installed, there is a complementary service that TOMRA provides. This consists in recollecting the containers from all the machines and delivering and selling them to companies which do the labor of compacting and processing the containers. Obviously, this service includes people. The complementary service is provided by an association between TOMRA which provides the people and a local transportation firm that provides the waste-recollecting tracks.
Due to the fact that in Peru the people in charge to collect the containers from the streets and trash bins are people with low resources, establishing this type of machines in Peru will directly affect them. That’s why we are planning to hire them to collect the containers from all the machines. These people will be trained, constantly motivated and will receive both financial and non financial benefits.
Finally, TOMRA will not use any intermediary at all and will sell the Reverse Vending Machines directly to the target. If succesful, as we will also see in the Action Plan section TOMRA will establish a subsidiary in the near future.
Strategy