Business Policy and Strategic HRM Assignment:

Industry Analysis Of
The Global Positioning Systems (GPS)
Technology Market
By
Michael Mulqueen
Ciaran Reid
Sean Ruane
Jamie Finnan
And
Dean Dawson
Introduction;
This report aims to identify the 4 major competitors of TomTom within the Global
Positioning System (GPS) technology industry through academic frameworks and analysis
while also identifying the market leader which occupies the GPS technology market. The
research conducted will identify the position of each competitor within the GPS market and
the segments in which they target. The research and analysis of the Global Positioning
Systems (GPS) technology industry will lead to strategies being developed to help TomTom
sustain a long term competitive advantage over competitors.
S.W.O.T Analysis of 5 main competitors within The Global Positioning System (GPS)
Technology Market

SWOT analysis can be simply understood as the examination of an organization's internal

strengths and weaknesses, and its environments, opportunities, and threats. It is a general
tool designed to be used in the preliminary stages of decision-making and as a precursor to
strategic planning in various kinds of applications (Johnson et al., 1989; Bartol et al., 1991).
A SWOT analysis summarises the strengths, weaknesses, opportunities and threats likely to
impact on strategy development that arise from such analyses.
(Exploring Strategy Text and cases Ninth Edition Prentice hall pg. 50)

SWOT Analysis of Navico

Strengths:

 The accusation of Northstar, a Marine Navigation company who have been in the
business for over 37 years. In that time the Northstar name has always been
synonymous with best-in-class, high performance navigation solutions.
http://ww1.jeppesen.com/company/newsroom/articles.jsp?newsURL=news/newsroom
/2013/Jeppesen_and_Navico_Compatible_Products.jsp
 4th quarter results in 2013 show Navico as the global market leader in marine
technology
http://www.lowrance.com/Global/Lowrance/press_release/Lowrance%20HDS%20Ge
n2%20Touch%20Press%20Release%20100112.pdf
 Success full three brand strategy giving Navico products diversification within the
market. (B&G, Simrad, and Lowrance.)
http://www.marinebusiness.com.au/archive/interview-navico-president-and-ceo-leif-
ottosson
Weaknesses:

 Navico are operating in a competitive market with bigger competitors having more
business resources and capabilities. E.g. TomTom buying tele atlas
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=agT1Po33faG4&refer
=home
 Only Concentrating on a niche of the GPS market may limit Navico’s growth and
market share Dawn Thilmany, Colorado State UniversityPh.D.
http://ag.arizona.edu/arec/wemc/nichemarkets/01whatarenichemarkets.pdf
Opportunities:

 Mexico has become Navico’s fastest growing market since 2012 with the opportunity
to grow even more in the future. http://www.interest.co.nz/business/63994/ian-daniel-
navman-wireless-tells-andrew-patterson-he-still-sees-plenty-growth-ahead-u
 Navico has entered into a principle agreement to acquire the Consilium radar
business and expand its market reach with a strategic sales & distribution agreement
http://pro.simrad-yachting.com/en/About-Us/News/Navico-has-entered-into-a-
 principle-agreement-to-acquire-the-Consilium-radar-business-and-expand-its-
market-reach-with-a-strategic-sales--distribution-agreement/
 Navico has acquired Contour Innovations which is mapping and Geospatial Software
Company which will provide Navico with the oppertuinity of new innovations and
improved mapping on products. http://www.fishingboating-world.com/Navico-
acquires-mapping-and-software-development-company/118762
Threats:

 Improvement’s in technology and smartphones along with free apps that can perform
like a Sat Nav. http://www.dailymail.co.uk/sciencetech/article-2487250/The-free-
iPhone-app-turns-entire-WINDSCREEN-sat-nav-device.html
 Competitors gaining first mover advantage in other markets which Navico could
occupy (This Week in Consumer Electronics. 7/16/2012, Vol. 27 Issue 15, p34-34.
1/8p. Joseph Palenchar http://0-
web.b.ebscohost.com.mislibsrv.lit.ie/ehost/pdfviewer/pdfviewer?sid=7ea005c2-8aa4-
4778-9a59-dde5e4793425%40sessionmgr114&vid=6&hid=117 )
Position of Navico:
Navico is currently the world’s largest marine electronics company, and is the parent
company to leading marine electronics brands: Lowrance, Simrad and B&G. Navico has
approximately 1,500 employees globally and distribution in more than 100 countries
worldwide.
http://www.navico.com/
SWOT Analysis of MiTac
SWOT Analysis of Garmin
Strengths
 Core competency of Garmin is its ability to leverage GPS technologies and in-house
manufacturing to create trendy but useful products for high growth markets.
http://www.garmin.com/en-US/company/facilities
 Provides efficient after sales services and superior customer support in areas like
repairs, technical support and warranties services.
http://www.garmin.co.za/about.php
 Manufacturing their products in-house reduces mishaps and ensures quality products.
(Wadhwa, Bhoon, K. S.1 Chan, F. T. S.2.Source: Industrial Management & Data
Systems. 2006, Vol. 106 Issue 3, p307-326. 20p)
 The company owns its manufacturing facilities in Taiwan and receives tax incentives
from the Taiwanese government.
http://foreigner.ntpc.gov.tw/_file/2968/SG/44628/D.html
 Garmin produces quality products that are ISO certified and further approved for use
in aviation by the FAA. http://www.garmin.com/garmin/cms/site/au/home/pressroom/

Weakness
 Garmin’s financial results are highly dependent on the automotive/mobile segment,
which represented approximately 58% of total revenue for Q3 of 2011.
http://www8.garmin.com/aboutGarmin/invRelations/reports/Q32011_Earnings_Call_
Transcript.pdf
 Large dependence on third party licensors for the digital map data.
http://www8.garmin.com/aboutGarmin/invRelations/reports/10-K_2007.pdf
Garmin license digital mapping data for use in its products from various sources.
However, there are only a limited number of suppliers of mapping data for each
geographical region. The largest digital map supplier is Tele Atlas who are owned by
TomTom.

Opportunity
 The global navigation satellite systems' (GNSS) technology is expected to be
embraced by the positioning facilities through mobile phones and route guidance
devices in the car. This will help to boost the GNSS market in the coming years
(Ferris, Mike.Source:Engineering & Technology (17509637). 3/22/2008, Vol. 3 Issue
5, p46-49. 4p.)
 Garmin could capitalize/invest in the technology of applications such as Google-
Maps. (Ferris, Mike.Source:Engineering & Technology (17509637). 3/22/2008, Vol.
3 Issue 5, p46-49. 4p.)
 Increasing number of smartphones, technology convergence, mobile commerce, and
location-based shopping are all expected to boost the global GPS market in future.
(Rowley, Jennifer3 j.rowley@mmu.ac.uk.Source:International Journal of Retail &
Distribution Management. 2014, Vol. 42 Issue 1, p25-39. 15p.)
Threats
 The market for navigation, communications and information products is highly
competitive. (Rimon, Elon1, IEEE Transactions on Robotics. Dec2008, Vol. 24 Issue
6, p1451-1457.) Garmin competes with other companies on the basis of design,
functionality, quality and reliability, customer service, brand, price, time-to-market
and availability. Garmin's principal competitors for portable automotive products are
TomTom and MiTAC, and Navman.
 Economic and political risks associated with companies operating in Taiwan
http://reports.weforum.org/global-risks-2012/#= Global Risks 2012 Seventh Edition,
Marsh & McLennan)
 Relations between Taiwan and the PRC have on some occasions adversely affected
the market value of Taiwanese companies (Hundagh chiu , June Dreyer , Relations
between China and Taiwan , university of Maryland)
http://digitalcommons.law.umaryland.edu/cgi/viewcontent.cgi?article=1133&context
=mscas could negatively impact Garmin's operations in Taiwan
SWOT Analysis Navman
Strengths
 Leading manufacturer of marine electronics and Global Positioning System
technology. http://www.navman.com.au/about-us.aspx
 Diverse range of navigation technologies across wide ranging industries
(http://www.marketwatch.com/story/navman-wireless-releases-industry-first-fuel-
management-solution-for-construction-fleets-in-partnership-with-oem-data-delivery-
2012-10-
10/rescue?SourceUrl=http%3A%2F%2Fwww.marketwatch.com%2Fstory%2Fnavman-
wireless-releases-industry-first-fuel-management-solution-for-construction-fleets-in-
partnership-with-oem-data-delivery-2012-10-10)
 Affordable price and easy to navigate interface
(http://www.navman.com.au/content.aspx?id=2285)
 Strong customer base 16,000 clients tracking 190,000 vehicles
(http://www.navmanwireless.com/about-navman-wireless/company-history)
Weaknesses
 Growing competition and lower profitability
(http://www.navmanwireless.com/about-navman-wireless/press-releases)
 GPS satellites are run by US Government. Any interference would disrupt the GPS
service.
(http://www.gps.gov/)
Opportunities
 New products and services constantly developed
http://www.navmanwireless.com/learn-about-fleet-tracking-and-monitoring/why-
navman-wireless
 Growing demand for GPS tracking
(http://www.navman.com.au/about-us.aspx)
Threats
 Competitive market (Technology Hardware & Equipment Industry Profile: Global.
Jun2011, p1. 45p.)
 Risk of saturating the GPS market (This Week in Consumer Electronics. 8/26/2013
p3-3 TABLETs computers )
 Shift toward navigation solutions on mobile phones and away from PNDs (Bulik, Beth
Snyder Advertising Age. 10/12/2009, Vol. 80 Issue 34, p4-22. 2p.)

Position of NavMan
Navman GPS is a leading manufacturer of world-class sat nav technology, offering
GPS navigation systems and digital drive recorders for cars, 4WD and trucks.
Navman has approximately 500 employees globally and was acquired by MiTAC
International Coprporation in 2007.
(http://www.navman.com.au/about-us.aspx)
SWOT Analysis TomTom
SWOT Analysis of Tom Tom
Strenghts

 Revenue from business solutions are on the increase

(http://annualreport2013.tomtom.com/management-board-report)
 Moved into a net cash position in 2013 for the first time in 5
years(http://annualreport2013.tomtom.com/management-board-report)
 Reliable satellite navigation technology
(http://corporate.tomtom.com/releasedetail.cfm?ReleaseID=796234)
 Research and development manufacturing capabilities
(http://annualreport2013.tomtom.com/management-board-report/financial-and-
business-review)
 Real time traffic and alternative routes feature on products available in 36 countries
(http://annualreport2013.tomtom.com/who-we-are/factsheet)
 Fleet Management grows to 38% to 330,000 connected vehicles
(http://corporate.tomtom.com/keyfacts.cfm )
Weaknesses

 Operating expenses increased significantly since 2008

(http://annualreport2013.tomtom.com/management-board-report )
 Over dependent on Portable Navigation devices
(http://annualreport2013.tomtom.com/management-board-report )
 In North America TomTom’s market share has decreased by 1 percentage point year
on year to 23% in 2013(http://www.gpsbusinessnews.com/Small-Loss-for-TomTom-
in-First-Quarter-2013_a4201.html )
 1,006 million in debt due to acquisition of tele atlas
(http://www.businesswire.com/news/home/20090721006497/en/TomTom-Reports-
Quarter-2009-Results#.UyCFRXivkdU )
 74% of revenue generated in Europe compared to 18% in North America and 8%
from the rest of world (http://annualreport2013.tomtom.com/management-board-
report )
Opportunities

 Continue to develop sport products and continue to use Nikes Capabilities to develop
their brand brand prestige (http://annualreport2013.tomtom.com/management-board-
report )
 Increase Revenue outside of Europe
(http://annualreport2013.tomtom.com/management-board-report)
 Creating digital maps for developing countries
(http://annualreport2013.tomtom.com/management-board-report/business-
risks/strategic-risks)
 Strategy going forward to offer individual components such as maps, traffic services
and navigation software, as well as a complete pre-integrated connected navigation
system. (http://annualreport2013.tomtom.com/management-board-report )
 Keep developing new own branded products
(http://annualreport2013.tomtom.com/management-board-report )
Threats

 Increasing competition especially in smartphone, mobile phone market and online

navigation (Thomas Keil and Tomi Laamanen Harvard Business Review Advertising
Age. 10/12/2009, Vol. 80 Issue 34, p4-22. 2p. 1)
 These factors include levels of customer spending in major economies, changes in
consumer tastes and preferences, changes in law, the performance of the financial
markets, the levels of marketing and promotional expenditures by the group and its
competitors, raw materials and employee costs, changes in exchange and interest
rates (http://annualreport2013.tomtom.com/forward-looking-statements)
 The devaluation of the US dollar against the Euro will affect profitability. Tom tom
has foreign exchange contracts to mitigate these risks however they don’t cover all
aspects
(http://annualreport2013.tomtom.com/management-board-report/business-risks/strategic-
risks)

 New map and navigation providers may choose to enter the automotive market, which
could significantly increase the level of competition Tom Tom face
(http://annualreport2013.tomtom.com/management-board-report/business-risks/strategic-
risks)
Porter's 5 Forces of the Global Positioning System (GPS) technology Industry
Porters 5 Forces: is the Awareness of the five forces can help a company understand the
structure of its industry and stake out a position that is more profitable and less vulnerable to
attack. To make profits in the long term you must respond strategically to competition. The
business also needs to look beyond direct competitors
(http://moodle.lit.ie/pluginfile.php/3536/mod_resource/content/1/5_forces.pdf)
1. New entry - Low

This defines how easy it is to enter an industry and this will influence the degree of
competition. The greater the threat of entry, the worse it is for incumbents in an industry. An
attractive industry has high barriers to entry in order to reduce the threat of new competitors
(exploring strategy text and cases ninth edition prentice hall)
Garmin has been able to achieve a competitive advantage through its penetration into
International markets. Its competitive advantage is through its ability to provide cheaper
products while maintaining high quality management through its manufacturing and
production processes. (http://www.nathanfeather.com/portfolio/files/mngt475.pdf)
Tom Tom Ltd operates in 4 different market segments Consumer, Automotive, Licensing and
Fleet Management. Tom Tom and Garmin have used strategic alliances with retailers across
the globe to provide it with more opportunity to expand its market share in domestic and
International sectors (http://annualreport2013.tomtom.com/management-board-report)
Very high start-up costs to acquire strategic capabilities needed to enter the market.
(http://www.gpsbusinessnews.com/TomTom-completes-Tele-Atlas-acquisition-reshuffles-
management_a882.html)
2. Buyer - High

Buyers now have varieties of different devices to reach the destination, apart from the PNDs,
they also could obtain the trip information by the use of smartphones or anyplace with public
internet.
Within four years smartphones captured much of the market that had once belonged to
TomTom and Garmin. By 2011, 33% of U.S. consumers were using smartphones for
navigation, and the share prices of TomTom and Garmin had cratered. (Thomas Keil and
Tomi Laamanen Harvard Business Review Advertising Age. 10/12/2009, Vol. 80 Issue 34, p4-
22. 2p. 1)
Low switching costs
Buyers can easily switch between one supplier and another, they also have a strong
negotiating position and can squeeze suppliers who are desperate for their business for
example major companies like TomTom are being stung by the popularity of cheap
smartphone navigation apps http://0-
web.b.ebscohost.com.mislibsrv.lit.ie/ehost/detail?sid=4ce6c2a6-8552-4719-9852-
85df59546de6%40sessionmgr112&vid=5&hid=119&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ
%3d%3d#db=bth&AN=90336930, Automotive News. 9/16/2013, Vol. 88 Issue 6586, p32-32.
1p. Sedgwick, David
 3. Supplier –

Supply chain and distribution model is outsourced, it depends on limited number of third
parties for the smaller companies like Navico and MiTec. Garmin and TomTom both have
their own fleet management companies which distribute their products. TomTom and Garmin
also own mapping company’s which provide the information on maps for their products. This
means both TomTom and Garmin are in control of the supply chain.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=agT1Po33faG4&refer=home
http://www8.garmin.com/pressroom/corporate/100305.html
4. Substitutes - High

Extra Industry Effects: Portable Navigation devices are facing a tough challenge from GPS
enabled mobile phones. Google and Nokia are providing free turn by turn satellite
navigation.
The uptake of smartphones in South Africa as satellite navigation devices relies primarily on
three key factors, the availability of affordable devices, the affordability of data plans and the
reliability of the 3G infrastructure (http://mycoordinates.org/pnd-vs-mobile-is-landscape-
shifting/all/1/)
5. Competitive Rivalry/Rivalry of the competitors - High

Competitor Balance: Smaller players within the market reluctant to challenge larger
competitors within the market.
MiTac:
MiTac in only a few years – become one of the leading players in the mobile GPS industry,
bringing mobility, navigation, and quality to an ever-growing audience all over the world.
MiTacs target audiences is focused on competitors who are highly likely to travel e.g. bag
packers, inter-railers target audience of 18-26.
http://www.mio.com/about-mio-brand-story.htm
Navico:
Navico is currently the world’s largest marine electronics company with the table below
showing how Navico have grew to be the world’s largest marine electronics company and
take controle of the marine GPS niche market.
Navico have the capabilities to competing in the portable GPS market but choose to
concentrate on their Niche market.
http://www.navico.com/About-Us/History/
TomTom and Garmin are the main players in the GPS industry with both companies’
products being very similar and targeting the same audiences who lead the market and are in
direct competition where as Navico and MiTac are indirect competitors. TomTom is also
facing increasing competition from smart phones which all of them offer similar services,
also TomTom facing the compositing with maps, services and built-in systems in cars with
others.
Low Differentiation: Less differentiation of TomTom products from competitors as well as
competitor’s products being similar to TomTom products makes it very easy for consumers to
purchases a substitute. This causes prices within the market to be very similar leading to
price wars. In 2006 the TomTom, Garmin, MiTac were locked in a price war. Garmin has
slashed retail prices across its automotive line by $50 to $100, the response from TomTom?
A doubling of its own rebate from $50 to $100 while on Black Friday the day after
Thanksgiving MiTac devices priced as low as $150, down from $300 to $400.
http://www.businessweek.com/stories/2006-12-12/navigating-the-gps-price-
warbusinessweek-business-news-stock-market-and-financial-advice
http://www.wikinvest.com/stock/Tomtom_(AMS:TOM2)
Competitor’s profiles

MiTAC:

Provide internal car computers/ GPS system which are portable. Provide tailored mobile,
ICT product/solutions and mobile GPS technology to regional demands across the world.
http://www.mitac.com/about/BusinessPhoilosophy.html
Navico:

Provide navigation systems for boats while also the world’s largest manufacturer of marine
electronics. http://www.navico.com/About-Us/
Garmain:

Provide GPS technology products for automotive, aviation, marine, outdoor, and sports
http://www.garmin.com/en-IE/company/about/
Navman:
Navman is a leading manufacturer of world-class marine electronics and Global Positioning
System (GPS) technology http://www.navman.com/en-gb/about-navman.htm

The most similar of the three competitors to TomTom is Garmin who offer GPS portable
systems products to TomTom for cars, outdoor activities and sports. The market is very
competitive with Garmin coming out on top of the market in 2010 even though they made a
loss.
The GPS market has been on a downturn since 2010 with the continued development of
smartphones offering GPS eating its way into the Satnav market.
Direct and Indirect Competition of TomTom
Direct Competitors:

Garmin: Satisfy the direct segment which TomTom occupy offering GPS technology products
in the automotive, sports and outdoor segments. Garmin are in direct competition with
TomTom’s for market share.
MiTAC: Provide a competition for TomTom with in the automotive segment competing with
TomTom to satisfy demand for GPS technology within this segment. MiTAC produce tailored
internal car computers which contain GPS technology and also produce individual GPS
products
Indirect Competition:

Navico: Concentrate on the niche market of marine electronics providing GPS systems
technology for boats and are the world’s biggest marine electronics company. Navico are an
indirect competitor as they satisfy a segment of the GPS market with Their Marin GPS
systems.
Navman: Also occupy a percentage of the GPS market by satisfying consumers in Marine
GPS systems and are direct competitors of Navico. Although Navico are the market leader in
the Marine electronics, Navman have become a leading manufacturer of marine electronics
and GPS systems which makes them both a direct competitor of Navico and an indirect
competitor of TomTom.
The three major competitors of TomTom are Garmin, MiTAC, and Navico. Garmin is
TomTom’s biggest competitor with a market share of 45%. MiTAC which controls 15% of the
market, designs, manufactures, sells, and services consumer and enterprise tailored mobile,
ICT product/solutions and mobile GPS technology. Navico reels in anglers and boat lovers
with its high-tech fish finders and marine GPS systems while also keeps hikers and hunters
on the right track with its portable location trackers. http://www.qessays.com/free-
essays/tomtom-company-analysis.html#
P.E.S.T.E.L Analysis of South African Sat-Nav Industry

The P.E.S.T.E.L framework categories environmental influences into six main types:
Political, Economic, Social, Technological, Environment and Legal. This framework provides
a comprehensive list of influences on the possible success or failure or failure on particular
strategies. (Exploring Strategy Text and cases Ninth Edition Prentice hall pg. 50)

 Political
South Africa will enter a new "radical phase" of economic transformation over the next five
years to address poverty, unemployment and inequality, President Jacob Zuma said in Cape
Town on Thursday. (South Africa.info, 2014)
VAT in South Africa:
Currently charged at 14% but certain goods and supplies such as exports are levied at 0%
rate of tax ( www.sars.gov.za/guideforvendors ) VAT is an indirect tax which is levied on
goods and services
 Economic

GDP is expected to grow at 3.5% in 2014. (Southafrica.info, 2014)

In January 2014, the current inflation rate was 5.78%. (www.inflation.eu/inflation-
rates/south-africa )
Latest statistics have shown South Africa economy added 308,000 new jobs.
(www.Southafrica.info , 2014)
Unemployment fell to 24.7% in the third quarter in 2013. (www.Southafrica.info , 2014)
Companies and close corporations are taxed at a flat rate of 30% on Income. There is a
secondary tax of 12.5% on declared dividends
http://www.saeafrica.com/index.php?option=com_content&view=article&id=64:legal-
aspects-of-doing-business-in-south-africa&catid=8:2010-02-16-01-40-
25&Itemid=29&lang=el
Consumer Discretionary Spending:
The growth of South Africa’s black middle class has been a dynamic boost for the economy,
attracting local and foreign investment, and now the country’s consumer landscape could
shift forward as another new emerging consumer segment takes shape in the lower social
ranks.
South Africa’s rand depreciated to the lowest intraday level since March 2009 against the
dollar after measures of Chinese manufacturing fell, pushing emerging-market currencies
weaker.
Selling into International markets results in exposure to movements in currency exchange
rates.
  Socio Cultural Factors-

Income distribution:

South Africa has the highest income inequality in the world measured by the Gini Index – a
level that has remained relatively unchanged between 1990 and 2011. This is one of the
biggest challenges facing the country and has a detrimental impact on the country's
economic development and business environment.
http://blog.euromonitor.com/2012/06/south-africa-the-most-unequal-income-distribution-in-
the-world.html

Population changes:

South African population growth is down by -.45% due to increases in AIDS. The total
number of persons living with HIV in South Africa increased from an estimated 4 million in
2002 to 5.26 million by 2013. For 2013 an estimated 10% of the total population were HIV
positive. Approximately seventeen percent of South African women in their reproductive ages
are HIV positive. http://beta2.statssa.gov.za/publications/P0302/P03022013.pdf
As income inequality is one of the highest in the world it is very hard to launch a product
successfully, certain segments based income, equality and ethnic background would need to
be targeted.
With the South African population growth and the amount of people living with aids on the
rise,this means that potential target markets may decrease.

 Technological factors-

Internet speed is slow and the percentage of South African’s with connectivity is alarmingly
low.
Hemisphere GNSS introduces the Eclipse P306 and P307, the latest models in the Eclipse
series. The Eclipse P306 and P307 track multi-frequency GPS, GLONASS, and BeiDou
satellite signals and are Galileo and QZSS ready. By tracking more signals, RTK positioning
performance improves especially in challenging environments.
Galileo early operational services are expected to go live at the end of 2014.
-Will lead to even better and faster GPS which is extremely beneficial to the Sat Nav industry
moving into the future.
Smartphone penetration 19% and growing. This is significant as potential customers can be
targeted through apps.

 Environmental Factors-

The South African government has proposed a carbon tax to reduce the country's greenhouse
gas (GHG) emissions. The government aims to reduce GHG emissions by 34 percent by
2020. The proposed tax rate is R120 per ton of carbon dioxide equivalent initially, increasing
10 percent every year until 2019.1
http://www.lexology.com/library/detail.aspx?g=cc8e13f6-635b-4204-90e4-7a6c20a200ce
This new tax would adversely affect TomTom’s entry to the South African market as it is a
tariff barrier to entry. If the company was to manufacture products in South Africa this new
carbon tax would increase the cost of producing products in South Africa which may lead to
TomTom increasing prices.
South Africa have per capita CO2 emissions higher than the global average (1.3 metric ton of
carbon per year): South Africa (2.39) http://cdiac.ornl.gov/trends/emis/tre_afr.html

 Legal Factors-

Employment law in SA:

Labour laws were passed by the National Assembly on 4 March 2014 and have been
submitted to the President Zuma for assent. The Employment Services Bill, 2012 (ESB) is a
new government initiative which will set up a public 'employment services agency' while also
providing regulation and registration of private employment services agencies. Employment
of foreign nationals dealt with in the Bill, and several requirements will have to be met before
such employment may take effect.
This bill will have a significant impact on labour relations in South Africa and future
employers in South Africa like TomTom should be prepared the changes proposed for
employment in South Africa. For example if TomTom wants to hire a skilled person who is
not South African it may become a problem if they do not suit the criteria outline in the The
Employment Services Bill. http://www.labourguide.co.za/

1
http://www.lexology.com/library/detail.aspx?g=cc8e13f6-635b-4204-90e4-7a6c20a200ce
 Blue Ocean Model

Blue oceans: are new market spaces where competition is minimised. Blue ocean thinking
therefore encourages entrepreneurs and managers to be different by finding or creating
market spaces that are not currently being served.
Red oceans are where Industries are already well defined and rivalry is intense. Red oceans
are associated with bloody competition and financial losses whereas Blue Oceans evoke wide
empty seas.
Blue oceans: contrast with Red oceans where industries are already well defined and rivalry
is intense.
A Strategy canvas compares competitors according to their performance on key success
factors in order to develop strategies based on creating new market spaces
Critical success factors are those factors that are either particular valued by customers or
which provide a significant advantage in terms of cost. These are likely to be an important
source of competitive advantage or disadvantage
(Exploring Strategy Text & Cases Ninth Edition Prentice hall pg. 73)

Factors which affect the Sat-Nav industry:

1. Price
2. Navigation/mapping capabilities
3. Ease of product usage
4. Technical Quality.
5. Up to date mapping information
6. R&D capabilities
 Navico:
1. Price: Navico’s Gps systems are priced between $199-$369, which is a premium
price in the general GPS market. Navico satisfies a niche in the GPS market
targeting the marine niche which gives Navico the advantage of being able to
charge a premium prices.
http://www.lowrance.com/en-US/Products/GPS-Handheld/
2. Navigation/mapping capabilities: Navico have mapping information for their Gps
products provided by Jappsen a Market leader in navigation and a navigation
expert.
http://ww1.jeppesen.com/company/newsroom/articles.jsp?newsURL=news/newsr
oom/2013/Jeppesen_and_Navico_Compatible_Products.jsp
3. Ease of Product Usage: Lowrance one of the three GPS brands owned by Navico
released a press statement on the 1-10-2012 stating a commitment to improving
the usability of products for consumers by making product screens bigger and
making touch sensors more sensitive.
http://www.lowrance.com/Global/Lowrance/press_release/Lowrance%20HDS%2
0Gen2%20Touch%20Press%20Release%20100112.pdf
4. Technical quality: Navico products won awards for being the world’s top selling
multifunctional display systems.
Lowrance press release 1-10-2012:
http://www.lowrance.com/Global/Lowrance/press_release/Lowrance%20HDS%2
0Gen2%20Touch%20Press%20Release%20100112.pdf

5. Up To Date Mapping Information: Navico products use Navicanics world

backround maps which are a template of the world map, seas, oceans etc.
Compared to competitors mapping capabilities are very poor as provider Jappsen
is a navigation expert and not a mapping expert. http://www.lowrance.com/en-
US/Products/Fishfinder-Chartplotter/HDS-5.aspx
6. R&D Capabillities: Navicos biggest R&D department is in New Zeeland where
they have 60 engineers based.. http://www.idealog.co.nz/blog/2013/03/inside-
navico Navico releases 18 new products a month (ODDNY EDWARDS | TRADE
MARKETING MANAGER, EMEA | NAVICO)
 Navman:

1. Price:
Navman MY450lmt 5" In car GPS $289 NZ
2. Navigation/Mapping Capabillities:
Navmans maps are supplied by Navteq. On average 4 new maps are released each year by
Navteq. Available maps from NavMan are limited to Australia and New Zealand and EU
countries including Germany, France and Spain.
http://www.navman.com.au/map-updates/
3. Ease of use:
Navman released a statement on 13 March 2013 in which they highlighted the ease of use of
the new Navman Move. The Move series of PND’s are equipped with bigger more responsive
screens. They also feature less icons and simpler menus making navigation much easier.
http://www.navman.com.au/content.aspx?id=2285
4. Technical quality:

5. Up to date mapping information:

Navman uses Navteq mapping systems. NAVTEQ's underlying map database is based on
first-hand observation of geographic features rather than relying on official government
maps.
Navteq releases approximately 4 new maps per territory per year.
http://www.navman.com.au/map-updates/
6. R&D Capabilities:
Navman is part of the international research & development company Navman New Zealand
Limited.
Navman research, design and manufacture marine electronic equipment, GPS OEM
products, in-car navigation, Handheld GPS navigation, vehicle tracking and mobile data
products. Navman New Zealand Limited is an internationally recognised company with
distribution partners world-wide.
http://www.tlparker.co.nz/gps_solutions/navman_wireless/about_navman_wireless
 MiTac

1. Price:
MiTac Magellan RoadMate Series
$169.99 – $229.99 USD
http://www.magellangps.com/Store
2. Navigation/Mapping capabilities:
Just as with the Navman range of maps, MiTacs uses NAVTEQ mapping software in their
PND’s.
3. Ease of use:
Magellan announced in March 2014 that it will introduce a new line of RoadMate PND units
featuring EasyTouch touch screens and an underlying Android OS for a more powerful
navigation experience. Magellan feels the new range of products are more ‘responsive,
empowering, and intuitive’.
http://www.magellangps.com/Newsroom/Press-Releases/Press-Release-January-6-2014_2
4. Technical quality:
The Magellan Road Mate series offers the user some unique features including built in dash
cam, rear view dash cam and real time traffic updates. The capabilities of the dash cam allow
important events during the drive to be recorded. With over 200,000 suspected fraudulent
insurance claims in the US since 2011 the new Road Mate dashcam can help provide
evidence of illegal or fraudulent claims.
http://www.magellangps.com/Newsroom/Press-Releases/Press-Release-January-6-2014_3
5. Up to date mapping information:
MiTac is limited to NAVTEQ’s ability to research and develop new maps. Currently
NAVTEQ releases approximately 4 new maps per territory per year.
http://www.navman.com.au/map-updates/
6. R&D Capabilities:
MiTac International Corporation is a worldwide technology innovator and manufacturer
with over 10,000 employees worldwide. MiTac has locations in the US, UK, Belgium, China
and Japan.http://www.magellangps.com/Company/About-Us
 Tom Tom

1. Price: Tom Tom Go live 1000 Europe Refurbished

€249.95(http://www.amazon.co.uk/s/ref=a9_sc_1?rh=i%3Aaps%2Ck%3Atomtom+sa
t+nav&keywords=tomtom+sat+nav&ie=UTF8&qid=1394481970)
2. Navigation/Mapping information: Offers maps for more than 95 destinations
worldwide. We release maps every quarter with the latest road changes, points of
interests and speed limits. Available in North, South and Central America, Europe,
Middle East, Asia, Australia, and New Zealand
(http://www.tomtom.com/en_gb/maps/?WT.Click_Link=top_nav)
3. Ease of use: Satnav takes the stress out of driving on unfamiliar roads. Where the
alternative is a road map pressed against the steering wheel such devices are
undoubtedly safer too use. A good satnav is one that is simple to use on the go with
clear instructions
(.(http://www.telegraph.co.uk/motoring/caraccessories/10394128/Top-10-
satnavs.html)

4. Technical Quality: Tom Tom IQ routes puts the driving experience of millions of
users the customers maps, calculating routes based on actual speeds driven on roads
compared to speed limits. Tom Toms IQ routes are always the smartest, most efficient
route. This leads to the customer saving time, fuel, and money
(http://www.tomtom.com/whytomtom/topic.php?topic=5&subject=3)
5. R&D Capabilities: During 2013, Tom Tom focused attention on improving the
software development capabilities within our engineering teams. Tom Tom have
implemented consistent software development methods globally, introduced technical
skills tests as part of our interview process for engineers and delivered new training
processes. In mid-2013, Tom extended the engineering capabilities programme to
include Product Management and Software Architecture.
( http://annualreport2013.tomtom.com/ceo-letter)
6. Up-to date mapping information: TomTom Traffic provides precise and up-to-date
traffic information for highways, major roads and secondary roads using OpenLR
location referencing in 33 countries in North America, Europe, South Africa,
Australia and New Zealand. The service includes congestion forecasting which
indicates whether a jam is growing or dispersing, and estimates how long the delays
will last.
(http://corporate.tomtom.com/releases.cfm)
 Garmin:

1. Price: £ 226.99 Garmin Nuvi 3597 Limit 5 Inch with Full Europe maps, free lifetime
map updates, Traffic Alerts and Bluetooth
(http://www.amazon.co.uk/s/?ie=UTF8&keywords=garmin+nuvi+sat+nav&tag=goo
giehydra-
21&index=aps&hvadid=21118092510&hvpos=1t3&hvexid=&hvnetw=g&hvrand=1
5166747001326247959&hvpone=&hvptwo=&hvqmt=b&hvdev=c&ref=pd_sl_3vzgf
uqoql_b)

2. Navigation/Mapping capabilities: Garmin is the market leader in navigation devices

that provides maps all over the world (https://buy.garmin.com/en-US/US/maps/on-
the-road-maps/worldmap/worldmap/prod662.html)
3. Ease of use: Garmin is among the most easy to use
satnavs.(http://www.telegraph.co.uk/motoring/caraccessories/10394128/Top-10-
satnavs.html)
4. Technical Quality: Garmin has become the most accurate, most advanced and most
dominant navigation technology ever to fly with civilian aviators. Most of this credit
goes to a team of engineers in Olathe. These aviation products are known for
reliability and practicality
(http://support.garmin.com/search/generalResults.faces?site=General&q=technical+
quality&GO=)
5. R&D Capabilities: Garmin’s vertical integration business model keeps all design,
manufacturing, marketing and warehouse processes in-house, giving them more
control over timelines, quality and service. There user-friendly products are not only
sought after for their compelling design, superior quality and best value, but they also
have innovative features that enhance the lives of our customers.(
http://www.garmin.com/en-US/company/about/)
6. Up-to date Mapping: nüMaps Lifetime is a 1-time purchase that lets you download
the most up-to-date map information on streets, highways and points of interest as
soon as new content is available — for the lifetime of your Garmin device
(http://www.garmin.com/garmin/cms/cache/offonce/us/maps/numaps-lifetime )