Assignment 04.

1: Case Study

Selene De León

Business, National American University

MT4450 Strategic Management

Professor Rolland Story

4th December 2022

Your case analysis should include the following:

A case analysis overview, including the company's current situation, most recent strategies,
and significant problems/issues confronting management.

The results of your Strengths, Weaknesses, Opportunities, Threats (SWOT) analysis of the
company.

The results of your financial analysis of the company, using at least three relevant Key
Financial Ratios from Table 1 in the "Guide to Case Analysis."

A detailed description of your recommended strategic changes that address the

problems/issues you identified above.

A well-developed action plan for how the company should implement your strategic
changes.

Spotify is a highly successful music streaming application. Daniel Ek and Martin

Lorentzon founded Spotify in 2006 as a small startup in Stockholm, Sweden. Citing
Thompson, Peteraf, Gamble and Strickland (2021) “Ek, and Spotify came to revolutionize
the music industry, Daniel Ek knows well that to remain competitive, the company needs to
differentiate its products and services.”

Spotify is a brand that bases its strategies on changes in the environment and
innovation. It has a dynamic proposal that grows along with the development of social
networks. At the same time, it is an ally of the music industry, as it has allowed its revenues
to grow again in the face of the challenges of piracy and the internet using file sharing
services.

Spotify's main competitive advantage has been its influence on social networks, the
creation of playlists and, especially, the possibility of following people with similar musical
tastes. There are also its growth strategies as mentioned Thompson, et. al. (2021) that
“include an ad-based business model allowing for both a free and paid subscription, global
expansion into different markets exponentially growing its number of subscribers, multiple
acquisitions that add new competencies and capabilities, and brand-name partnerships with
industry leaders such as Disney, Xbox, and Samsung among others.”

This platform offers a service tailored to the needs of each user, allowing them to
integrate online music and interact with other users from the same platform easily. Another
advantage of Spotify that benefits its users is that it has agreements with different cell
phone operators

However, Spotify is a company with enormous difficulties from a competitive

standpoint. On the one hand, it is part of a highly competitive industry, which means that
the more competitors there are, the more likely it is that the company's profitability will
decrease. On the other hand, its sales costs are very high due to the fact that industry
suppliers, i.e. record labels, take a very large portion of the revenues generated by artists
and albums.

        

Reference List

Thompson A., Peteraf M., Gamble J., & Strickland A. (2021). Crafting & Executing

                      Strategy: The Quest for Competitive Advantage: Concepts and Cases.

                      [VitalSource Bookshelf]. Retrieved from

                      https://bookshelf.vitalsource.com/#/books/9781264250165/