Emma\'s Parlor Case Study Emma Is Wiped

Emma's Parlor Case Study

Emma is wiped out. In her fatigue, she is thinking about possibly selling one of her two businesses. Yet, this would be a major mistake. The two businesses share many synergies that allow her to capitalize on marketing and up-selling opportunities. Although breaking these synergies may not signal the failure of the business, it would definitely take away some of the major elements of Emma's current competitive advantage above her competitors in both areas, on the web and in retail locations.

There are a number of synergies between these two businesses. According to the external research, "In the business environment, synergy occurs when two or more businesses or resources come together to make a greater impact than they would separately," (Brookins 2012). Emma clearly has the ability to cross market her products and gain consumers interested in both through acquiring their businesses with the other. In her tea room, Emma has the ability to market her own branded specialty teas. Being able to cross market is a crucial element of symmetry that can benefit two businesses (Brookins 2012). She can hold events at her tea room which feature her specialty teas, therefore acquiring customers on a local level who can also enjoy the product at a higher premium while dining in her tea room. This would also result in possible up-selling as well, which is another staple of synergies between businesses. Here, the research suggests that having the ability to get a consumer in store "significantly reduces the cost of follow-up sales efforts" for other products as well as the original product itself (Smith, Gopalakrishna, & Smith 1999 p 4). Essentially, customers coming to drink her specialty teas in person may also buy a number of her other products that they would have not been able to enjoy online. She can then increase the sales of her scones and other pastries as add-on products to complement her specialty teas. Overall, the major synergies shared result in a greater marketing advantage and the ability for Emma to tap into her already established customer base to increase future sales of her teas and other products, both in person and on the web.

These synergies are going to have an impact on each individual business. Thus, Emma has a number of clear opportunities to capitalize on these synergies in order to be able to keep both of her businesses flourishing. They are not necessarily an absolute must, as if she did end up closing one of her businesses down, the other may still survive. Yet, with such a cost-effective and easy way to market utilizing the synergy of the two businesses, she would be giving up a competitive edge by selling one of the two businesses. The synergies between the two businesses help Emma save costs in marketing and promotions, as most in-store businesses can augment the online sales of specialty products consumers may otherwise be hesitant to buy without trying first in person (Smith, Gopalakrishna, & Smith 1999). Moreover, the web branded tea helps market the location of her tea shop as a way to try out these teas and ask Emma's advice as to which tea would be best for the customer's unique tastes and situation. According to the research, "the most effective and efficient marketing plans are those that maximize the synergy between products, distribution channels, price, and promotion" (Kim Atler 200 p 2). Te synergies between her two businesses are a crucial, and cost effective, factor in her marketing strategy and competitive capabilities. As such, it would be foolish for Emma to sell or close one of them down; rather getting an experienced restaurant manager to handle the tea shop itself would be the better option.