Evolving a successful marketing strategy depends on an effective situation analysis, which involves identifying the customer needs, changes in the operating environment, new opportunities, and the capability of the company to meet these changes. Scholastic corporation is one of the leading publishers catering to the children's segment. With decades of experience in children's publishing and links with most schools libraries across the nation the company has a great outreach to the student segment compared to other competing publishers. However, some changes in the external factors have clearly affected the company's business in a negative way. First and foremost of them is the government's cutting short of school budget allocation, which implied that libraries could no longer afford to spend funds for buying new books. This was a drastic blow for Scholastic as the company depended on its extensive tie-ups with school libraries for its regular business. Next, is the surge of the competitors such as Simon and Schuster and Houghton Mifflin who are capitalizing on Scholastic's inept handling of the changing market situation. These competitors, by their more effective marketing strategies have already started to increase their share in the market, which was previously largely dominated by Scholastic. Scholastic has failed to forge relationships with teachers and management in reaching out to the students. This lack of appreciation of the value of proper human relations is another big hurdle in its business interests, especially when the market seems to be lagging. .

             To be successful under these changing circumstances Scholastic has to revamp their marketing strategy. Focus should be placed on increasing the literacy interests of the younger generation. Under the strange circumstances that the government is crying about improving the literacy skills of students while at the same time cutting the funding for the schools, Scholastic could put to good use its extensive connections with schools by actively participating and organizing book fairs and book clubs.