TiVo case analysis

A. SWOT analysis

Strength:

Pioneer in the digital video recorder category

High customer growth rates

Easy to use and equipped with numerous innovative and advanced features

High level of customer satisfaction

Friendly-sounding name: a cute brand identity would give a gracious face to the machinery

Brand recognition and loyal customer strength

Partnership of consumer electronics superstar brands Sony and Philips for quick entry and
development and itbrought an image of reliability

Nationally available through electronic chains like Best Buy

Multiple potential revenue streams: opportunities for advertisers and networks.

Weakness:

A lack of category and brand awareness is the key cause of TiVos lackluster sales because its the
first in digital video recorder category.

Functions were difficult and confusing to explain to customers.

It separated from customers by partners, resulting in ineffective communication with its

consumers.

The manufacturers reps couldnt give TiVo the amount of support it required. It was hard to
convey a sense ofurgency to TiVos distribution partners.

High salesperson turnover rate in consumer electronic stores made training efforts ineffective.

It dependents on only a few suppliers.

Expensive product with additional service fee for recording and no reference point

Restricted promotional activities to public relations, animating its website, and a very limited mass
mediacampaign

O pportunity

High market growth

Sponsored content: DirecTV-TiVo bundle, AOL

Valuable market research data

Electronic commerce

Both ReplayTV and UltimateTV were taking another path, emphasizing the amazing features of
the digital video
recorder.

Threat:

Established players in traditional markets are entrenched and will implement defensive strategies
to protect their
market share (eroding traditional strategic segment barriers)

Legal challenges

Legislative agenda could restrict opportunities

Low barriers to entry for technology is easy to replicate

Many competitors many are heavy weights.

B.4 Ps Marketing Mix
1) Product

Advanced features:
o TiVo made a big idea realyou could really control what you watched and when you watched
Pausing and replaying live TV
o Recording without DVD, VCD or video cassettes
o Electronic Program Guide (EPG)
o "Thumbs up" and "thumbs down" buttons for rating user's favorite shows
The season pass feature
Fast forwarding feature, up to 60 times the normal speed
Suggesting users, the shows they would want to watch
Downloadable feature upgrades and update of programming schedules.

High level of customer satisfaction:

Everyone who owned TiVo seemed satisfied with it, with 72%of owners even claiming that TiVo had
made TV viewinga lot more enjoyable.

Brand name: a friendly-sounding yet all comprising nameTiVo (TV your way). A cute brand
identity would give
a gracious face to the machinery.

Product variety and packaging:

Two different models and three service packages available to attract different consumer markets

Confusion in introduction:
Its functions were difficult and confusing to explain to customers. There was some confusion in the press
as tohow the new product category should be introduced. Oftentimes the press discussed the features of
the device,but it wasnt always to the advantages of the company, as the first generation product was no
free of problems.

2) Price


High Price:
A $1,000 ticket meant TiVo was more expensive than most TV sets, and more than twice the price of a
good satellite system.

No reference point: With this service being so new there was no reference pricing point.
3) Place(Distribution)

Pa r tn e rsh ip:
TiVo built a partnership of consumer electronics superstar brands Sony and Philips for quick entry and
development. The two companies manufacture the black box, distribute it, and promote it to retailers.
Thus,
TiVo is separated from customers by partners.

National distribution:
TiVo became nationally available through electronic chains like Best Buy in September 1999. In
October 1999,
Circuit City and Sears were added; a national distribution was in place.
4) Promotion

Promotional restrictions:
While the hardware manufacturers took control of retail distribution and in-store communications, TiVos
promotional activities were restricted promotional activities to public relations, animating its website, and
a very
limited mass media campaign.

Ineffective role of early adopters as advertisers of TiVo

A catchy communication campaign with a boldly humorous tone that helps consumers envision
how TiVo
restored the fun of television.
C. Market Segmentation
D.Six elements in Brand Positioning
1) Target consumer

In the relatively young DVR market, the initial customer base is made up of "early adopters",
niche consumers
who purchase the product early in its lifetime. As the product matures, the target customer shifts away
fromearly adopters toward a more mainstream market. The cost of gaining additional customers increases
with theneed for greater marketing spending to lure more customers.

Young professionals (23--37 years old)

M al es

Middle--income households.

2) Brand name

A friendly-sounding yet all comprising nameTiVo (TV your way)

3) Brand personality

Initial, unrestricted, functional and considerate (friendly)

4) Product/competitive frame

Digital Video Recorder

ReplayTV emerged as a strong competition.

Software leader Microsoft launched UltimateTV.

Jovio, a start-up in Personal TV category, intend to launch a free service that would be similar to
TiVos.

Conventional VHS video recorders continued to sell well.

5) End-benefit

really control what you watched and when you watched it

personal home TV network

6) Rational support

Pausing and replaying live TV

Season pass feature

E.How to re-launch TiVo?

For Product: DirecTV--TiVo bundle, AOL

For Price: New Pricing Strategy

Drop the price of the 30 hour recorder from $999 to $399

Sign a three-year contract and pay only $24.95 monthly for service and hardware

After three year contract is up, pay $12.95 monthly or pay reduced price ($149) lifetime subscription

For distribution channel: Online retailer, e.g. Amazon.com

For Advertising and communications: Different media for different purposes.

Use TV ads to raise awareness, interest, curiosity, and to promote the TiVo brand identity. TV ads
introduce thenotion that you can have your own personal TV network and you dont need to rely on the
networks in terms ofdeciding what you watch, and when you are going to watch it.
Print ads describe some benefits and benefits in a different way than technology.
The website offers a deeper educational experience.

Improvements
o keep accelerating pace of change, and supply better services\

o Continue to revolutionize the way consumers watch and access home entertainment, by making
the TiVo DVRthe focal point of the digital living room.

Combine TiVo and Internet Searching tools(ex. Google)

1.to offer unequaled search capability
2.to aggregate content
3.To connect advertisers and consumer