Download - Tutorial 3 - Kindle Fire

Strategic Marketing – SUMMER SCHOOL 2014 1© Imperial College Business School

Marketing Planning and Competitor Analysis

Tutorial 2: Kindle Fire

Strategic Marketing – SUMMER SCHOOL 2014 2

• Lecture Revision– Internal Planning Tools– External Planning Tools

• Case Discussion

© Imperial College Business School

Overview for today


Managing the internal planning process


What is market planning?

Corporate

Operational

Departmental


Name three internal planning tools


Internal


• Customer concerns such as service quality, cost and response times

• Internal measures such as staff productivity, range of skills

• Financial measures such as revenue, profitability and costs

• Learning and growth or innovation measures such as rate of product development, availability of staff training

Strategy-stakeholder alignment


1. Balanced Score Card


Sources of competitive advantage


2. Porter’s Value Chain


Management and organisation design


3. McKinsey 7s


1. Strategy - the plan devised to maintain and build competitive advantage over the competition.

2. Structure - the way the organization is structured; reporting protocols.

3. Systems - the daily activities and procedures that staff members engage in to get the job done.

4. Shared Values - the core values of the company that are evidenced in the corporate culture and work ethic.

5. Style - the style of leadership adopted.

6. Staff - the employees and their general capabilities.

7. Skills - competencies of the employees working for the company.

Management and organisation design


3. McKinsey 7s


Name three external planning tools


External


Marketing Environment


1. SPICC


Analysing industry environment or ‘structure’


1. Porter’s 5 Forces

e.g. Think about the pharmaceuticals vs. (post-regulation) airline industry


Merging internal and external factors


3. SWOT Analysis


Situation in 2012…• 5 million sales in Kindle Fires – over half of non-Apple

tablet market (iPad launched in 2010). • Amazon share price has dropped $40 since the launch

of Kindle Fire. • Analysts concerned about selling hardware at cost,

betting that content and commerce revenues would make up for it.

• Needed to modify the positioning the device in response to new entrants such as Samsung, Motorola and Google

What is the situation?


Case Study: Kindle Fire


“Invention is in Amazon’s DNA”

(Bezos, Letter to Shareholders, 2010)

Amazon in 2012


Current Situation


• E-Reader market in 2007: Ripe for disruption?

• Amazon Kindle (Mark 1)

features, price, partners• E-Book ‘ecosystem’

How does it work?

Early days of the ‘e-reader’ market


Setting the scene


Competition from the Nook, iPad and Android: How do their features compare?

Amazon Kindle ‘Fire’ (Mark 2)

What’s new? features, price, partners (publishers)

Target segments: Media junkies, Mobile gamers, Higher education

Q1. Form a competitive position and a product assessment, as part of planning, would you categorise the Kindle Fire as a ‘tablet’ or not? Explain your decision.

Q2. Devise criteria for comparing product offerings and position the Kindle Fire

Rise of competition and the tablet market


Tablet (R)evolution


Product features and competitive advantage


Tablet (R)evolution

Kindle Nook iPad Google Android

Kindle Fire

Price $ $ $ $ $

Features

Strategic objective

Competitive Advantage

e-reader tablet

t


Q.2 Based on your appreciation of the case, what bets is Amazon making in the business model for the Kindle?

Where is he predicting Amazon’s future $ revenues will come from?

Betting the business


Case Study Questions

Hardware Content Commerce Advertising


A chart Bezos should have looked at in 2010?


E-Commerce Trends


https://www.yahoo.com/tech/amazons-first-smartphone-the-fire-phone-has-a-89237543259.html

Fire phone: Why didn’t he do this before?


Amazon Smartphone





How have circumstances changed?


Current situation

Jan 2014: Q1 Results Amazon warns of possible first-quarter loss, stock falls

June 2014: Bezos announces Launch of Amazon Smartphone