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Innovation Strategy Analysis of HAWK-EYE INNOVATIONS - New Business

Models and Disruptive Innovation Course

Experiment Findings · February 2022

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Innovation Strategy Analysis of
HAWK-EYE INNOVATIONS
New Business Models and Disruptive Innovation
Course – Spring 2022
Piotr PIETRAS

ABSTRACT
The following document presents the innovation strategy
analysis of Hawk-Eye Innovations. First part of the analysis
concerns the company’s business model with all of the
necessary details. Second part examines the value
proposition from both customer’s and product’s perspective.
Third part presents the sales process with a detailed
analysis of every channel in regard to particular metrics.
Finally, the analysis presents potential disruption threats for
Hawk-Eye Innovations and indicates the opportunities for
further improvements.
Table of Contents
Introduction ............................................................................................................. 3
Business Model ....................................................................................................... 4
Customer & Users ............................................................................................... 4
Early Adopters ..................................................................................................... 4
Problems / Jobs To Be Done .............................................................................. 5
Existing Alternatives ........................................................................................... 5
Revenue Streams ................................................................................................ 5
Solution ................................................................................................................ 5
Unique Value Proposition ................................................................................... 5
Channels to Market ............................................................................................. 5
Key Metrics .......................................................................................................... 6
Cost Structure ..................................................................................................... 6
Unfair Advantage ................................................................................................. 6
High-Level Concept ............................................................................................. 6
Value Proposition.................................................................................................... 7
Customers ........................................................................................................... 7
Needs ................................................................................................................ 7
Wants ................................................................................................................ 7
Fears ................................................................................................................. 7
Product................................................................................................................. 8
Features ............................................................................................................ 8
Benefits ............................................................................................................. 8
Experience ........................................................................................................ 8
Channels .................................................................................................................. 9
Awareness ........................................................................................................... 9
Acquisition........................................................................................................... 9
Activation ........................................................................................................... 10
Retention............................................................................................................ 10
Referral............................................................................................................... 10
Revenue ............................................................................................................. 10
Outlook .................................................................................................................. 12
Disruption Threats for COMPANY .................................................................... 12
Innovation Opportunities for COMPANY ......................................................... 13
References ............................................................................................................. 15

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Introduction
Hawk-Eye Innovations is a company that is part of sport media industry. It focuses on
enhance television broadcast of sporting events by providing the solutions that
enable to verify any controversial situation that happens during the event.

The company was founded in 2001, in the United Kingdon as Hawk-Eye Innovations
Ltd and was based in Winchester, Hampshire. According to the company’s official
website, its mission is to be the trusted choice for pioneering and inspiring change in
sport (Hawk-Eye Innovations, 2022). In 2010 it was sold and became part of Sony
(Hawk-Eye Innovations, 2022).

According to company’s website, Hawk-Eye Innovations is the employer for

approximately 1400 people (Hawk-Eye Innovations, 2022). Since the company is not
listed at the stock exchange, its size and value could be indicated by its annual
revenues. Value of them reached 50.6 million pounds, with a profit after taxation of
9.3 million (Global Database, 2022).

Its flagship products are the technologies that allow to make an official review of a
controversial situation during the sporting event like matches of football, tennis,
cricket or snooker (Hawk-Eye Innovations, 2022). There are three main solutions
offered on the market (Hawk-Eye Innovations, 2022a). The first one is call SMART
(stands for Synchronised Multi-Angle Replay Technology) and give an opportunity to
make a synchronised video and audio capture and do a playback in order to
undertake a video verification – used by mostly in Football, known as VAR (Hawk-
Eye Innovations, 2022a). Second solution is called TRACK, that tracks precisely the
movement of the object in order verify the calls made by referees (Hawk-Eye
Innovations, 2022a). This solution is mostly known from tennis, where players were
given a chance to ask for official review of the play, using this technology. Final
solution is called INSIGHT and allows to perform advanced post-event analysis of
the action that happened on the court or on the pitch.

Key customer segments of Hawk-Eye Innovations are sport governing bodies and
sporting events broadcasters. The first group works with a company in order to
provide a fair and transparent environment for the competitors in the arena, to make
any game controversy-free. However the second group thinks more about the
television audience. Broadcasters want to provide the in-depth analysis of the game
for the spectators watching at home, because of the will to attract them in a growing
number.

The innovation approach that Hawk-Eye Innovations has is disruptive. With its
products, the company has disrupted the media industry, because of its solutions
that were better and more advanced than the broadcaster that televised a sporting
event could provide.

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Business Model

Figure 1 – Lean Canvas for HAWK-EYE INNOVATIONS (template by Neos Chronos Limited)

Customer & Users

For the Hawk-Eye Innovations, there are two main segments of customers that are
also users of the solution. First segment is sport governing bodies. They are willing to
have the solution, due to the fact they want to provide fair, transparent competition
for the competitors and the spectators. Having the opposite of it would be detrimental
in terms of the image of the competition and the governing body itself.

Second segment is created by broadcasters. They would buy the solution (especially
the INSIGHT tool) in order to provide a better analysis to the spectators watching the
event on in the television or the internet. It’d be helpful to provide more data-driven
insights of what happened during the competition.

Early Adopters
The ideal customers could be described by two main characteristics. Perfect client
would seek a fair outcome of a sporting event and scandal-free image of the sport
and a certain event. It’s due to the fact that our solution is designed to clarify any
situations and decisions that could be considered as an error. When error happens
there could be a decrease in reputation which will negatively affect the organization
that is our customer.

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Problems / Jobs To Be Done
World of sport, suffers by having a lot of controversies that have a negative impact
for the outcome of certain games, which can be considered as unfair. Hawk-Eye
Innovations wants and tries to tackle those challenges in the world of sport – clarify
close in/out calls during a sporting event, provide an unquestionable outcome
of this review and of the sporting event in general and finally wants to eliminate
referee’s mistakes, that have a negative impact on the competition.

Existing Alternatives
Most advanced alternatives – comparing to what Hawk-Eye Solutions can offer – are
the products called Goal-Ref and Goal Control. However it must be said that they are
only focused on football, therefore the flexibility of adapting the product to different
sports is limited. Television replay is a low quality alternative, because of its
inaccuracy – it’s obvious that lack of precision could be questioned by the
stakeholders of a certain sport or event. Final alternative is a lack of action, however
it does not solve the problem, which could be detrimental to the stakeholders.

Revenue Streams
There’s one main revenue stream, which is contract signed with the customers.
Obviously, number of contract creates the situation where the revenues are
diversified, therefore there’s significantly smaller risk of not having any inflow of
money from the market. Since the sporting events take place all the time during the
year, this revenue stream is stable. It’s worth mentioning that the company could
experience some fluctuations of revenues, due to the sporting events that take place
every two or four years, but not annually.

Solution
Hawk-Eye Innovations provides solutions that allows to make a review of the
particular play on demand, when the decision is considered as mistake or needs
clarification. Moreover, it’s flexible – it can be adjusted to any sport and any event,
therefore the controversy-free and fair outcome of the competition could be provided.
It’s based on object tracking technology, which makes it very precise and most
importantly, unquestionable when it comes to the result of the review (Hawk-Eye
Innovations, 2022a). Moreover company’s products offer more insightful analysis of
what happened during the event, which would contribute to the better understanding
of certain sport.

Unique Value Proposition

It’s should be described by highlighting the advantages of implementing solutions
provided by the company over what is proposed by sport broadcasters. Hawk-Eye
Innovations’ product are more precise in providing the video verification, but also
more insightful when it comes to the post-event analysis, due to its massive data-
driven approach.

Channels to Market
Access to the market could be reached by offering trails in order to test the
technology during the sporting events. Offering this for free could be the best
promotion and a proof that the solution is effective during the competition – it’d also
be a good stage to present the advantages of the solution. Another channel are the

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fairs that are dedicated to techonologies in sport, for example SPORTEL that
annually takes place in Monaco. It’s a great stage to present the solution and aquire
new customers. Obviously, promotion should also be done by using digital channels
– the company’s webstie for instance.

Key Metrics
Metrics that should be observed concern both money and the quality of the solution
provided by the company. The obvious one is revenue stream and the will to
increase them – this will help company grow and increase its market share by
implementing the solution at bigger number of sporting events, which is also a metric
to follow. Very important metric is the margin of error, the smaller it is, better for the
solution and company can solve controversial situations in a unquestionable way.

Cost Structure
The cost structure is related to the flexibility of the solution implementation. Every
implementation would generate the costs of purchasing, delivering and installing
cameras at the arena. Moreover, software would also have to be adjusted to meet
the requirements of particular sport and the event. Finally, everything has to be
controlled, therefore the salary cost should also be taken into consideration.

Unfair Advantage
The unfair advantage could described by both technological advancements of the
solution and long-term partnership with sport governing bodies that organize
particular competitions. It’s not easy to adapt the real-time object tracking to any
sport with maintaining the same degree of precison. Moreover, since the company
has already provided number of governing bodies with its solution, it wouldn’t be
easy to replace it.

High-Level Concept
Hawk-Eye could be describes as a surveillance of event during sport competition. It’s
due to the fact that the technology is based on the camera located around the arena
that make precise object tracking possible. Just like CCTV camera, the set of Hawk-
Eye’s cameras are designed to record and review.

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Value Proposition

Figure 2 - Value Proposition Canvas for HAWK-EYE INNOVATIONS

Customers
Needs

Customers of Hawk-Eye Innovations want to provide a possibility to clarify close

in/out calls during a sporting event quickly to interrupt an event as shortly as possible
(Harrod Sport, 2018). Moreover, those customers wants to have unquestionable
outcome of a sporting event that they orgainze and finally they want to eliminate any
mistakes made by referees that would unfairly harm one competitor.

Wants

To both of the customers, the most important gain from using the solution provided
by Hawk-Eye Innovations will be increased revenues. In order to achieve that,
governing bodies have to have a controversy-free competition and the broadcasters
need to offer the attractive coverage. Once this is achieved, their image will be
enhanced as those organizations that indeed want to improve the thing they’re
responsible of.

Fears

The acquistion of the solution provided from the company would obviously have the
threats. Firstly, there would be some concerns about the precision of the solution,
that could also potentially make an unfair mistake (The Conversation, 2012). Another
fear is related to the impossibility to adapt the technology to certain sport or to the

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needs of the viewers. Finally customers fears about the attractiveness of the
analyses provided thanks to the technology provided by Hawk-Eye Innovations.

Product
Features

Hawk-Eye Innovations provides solutions that allows to make a review of the

particular play on demand, when the decision is considered as mistake or needs
clarification. Moreover, it’s flexible – it can be adjusted to any sport and any event,
therefore the controversy-free and fair outcome of the competition could be provided.
It’s based on object tracking technology, which makes it very precise and most
importantly, unquestionable when it comes to the result of the review (Hawk-Eye
Innovations, 2022a). Moreover company’s products offer more insightful analysis of
what happened during the event, which would contribute to the better understanding
of certain sport.

Benefits

The most important benefit is the fact of elimination human mistakes made by the
referee due course the event, since the technology precisly tracks the movement of
the object. When this is provided, it’ll only enhance the image and the reputation of
the customer. Taking this subject from the perspective of the broadcaster, the key
benefit of the solution provided by Hawk-Eye Innovations is that the traditional
coverage of the sporting event could be improved in an interesting way.

Experience

The experience that Hawk-Eye Innovations give to the customers is most importantly
a provision of fair environment, during the event. Secondly, customer can feel
innovative, because of the technology that could refresh the most traditional sports in
the world (BBC, 2013). Moreover, solution can provide the experience of having the
outcome of the review on demand, therefore customer can effectively use the
solution at any time during the event (Harrod Sport, 2018). Transparency is also part
of the experience provided by the Hawk-Eye Innovations – any type of the review is
presented to everyone on the screens and the result of the verification is clearly seen
to everyone (Hawk-Eye Innovations, 2022a).

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Channels

Figure 3 - Pirate Metrics (picture based on a picture by LEANSTACK.com)

Awareness
Stranger: In order to build the awareness about the company and the product, it’s
important to generate the potential customer’s interest. Hawk-Eye Innovations
appears on the sport business fairs with its technology to both present its recent
advancements and reach potential customers. In terms of digital marketing, company
runs its corporate website, where all of the necessary information are presented,
moreover it’s active on social media platforms, mainly on LinkedIn. Company
appears also on other websites regarding sport technologies, takes part in discussion
– all of this is dedicated to build the awareness of the company. Resources that are
needed to build the awareness are marketing team with the necessary budget to take
advantage of the opportunities to present the company. Awarness building is
measure by time on the website measure and view of the content on social media
platforms.

Acquisition
Prospect: The process of acquiring the customers starts from very simple steps like
creating opportunities the contact the company and ask for more details about the
solutions and opportunities for cooperation. Those steps are sharing e-mail address,
contact phone number on the corporate website. The resources needed to perfrom
this action are website, Customer Relation Management (CRM) Specialist and the
person responsible for marketing. The metric that measure the successful acquistion
is number of messages sent by the contact form.

Marketing Qualified Lead: Company analyses the traffic that was created on the
website, social media platforms, including the engagement. Moreover, it presents the

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possibilities of technology implementation on corporate’s website to possibly stand a
chance of new customer acquisition. Resources needed in this activity are teams of
marketing specialists and data analysts. Metrics that measure this aspect are
number of visits on the corporate’s website and contacts from customers throughout
the contact form.

Sales Qualified Lead: Important step during the process of acquiring the customers
is the meeting when all of the contract terms are discussed, sales offer with pricing is
presented. Company presents the offer that include the solution needed and the
price for the product. Important part of it are represented by negotiation – it’s the time
when both potential customer and company can review their expectations and adjust
the offer to successfully close the deal. Resources needed in that step are sales
representatives, business specialists and the offers with pricing possibilites. The
metrics that represent this stage offers into purchases conversion, and offers to
made to customers. They are essential to measure the success in turning potential
customers into real ones.

Contract: During the stage related to the contract, company prepares the documents
for both sides of the agreement, with all of the terms that were agreed throughout the
negotiation process. Moreover, the payment options are presented, i.e. full payment
done at once or paying in installments. With all of these agreed, contract is signed.
The resources needed are lawyers that prepare the contract, accountants that record
the transaction and make it visible in the company’s financial situation. Metrics that
would represent the successful acquisition on the “Contract” stage are those that
reflect the change in revenues, namely percentage change and overall revenue
stream size.

Activation
Success Management: To ensure that the experience from using Hawk-Eye
Innovations’ products is the best possible, company delivers and then implement
every element of the system on the arena where the sporting event take place. The
qualified operators hired by the company are responsible for successful activation of
the product at customer’s venue and support its usage throughout the event. The
resources needed are logistics that make equipment transportation possible, support
staff at the arena and the equipment that has to be installed. The metric that is
possible to measure at most extent the activation part success is the amount of
positive review from the customers.

Retention
Repeat Sales: Hawk-Eye understands that the best way to retain its customers is to
offer the improvements and act proactively when any issue appear. Therefore,
company provide both optimization and enhancements that improve the performance
and effectiveness of the technology. Resources used in that process are obviously
technology developers that are involved in providing the best solutions to the
customers and most importantly the feedback from direct customers and indirect
ones that are spectators of sporting events. In order to measure the success of
retention, it’s essential to look at monthly revenues and its percentage change.

Revenue
Contract: In order to have more revenues, company prepares the contract with all
the agreed terms of it to both side of the deal, moreover it prepare the options for the

10
payment and present it to the customer. Resources needed here are contracts,
lawyers that formally prepare the documents and accountants that record the
transaction. Revenue is measured by its overall size, measuring yearly or monthly. In
order to check the change of performance in sales and financial situation, percentage
change in revenue monthly or yearly.

Expansion Sales: Revenues are also increased during expansion sales stage. In
order to increase revenues, company offers the extension of the contracts and also
offer new features to existing customers, therefore it’s more likely to achieve bigger
revenue stream. Resources needed are sales representatitves with offers prepared.
The metric that measure the succes of this acitivity increase of yearly or monthly
revenues.

Referral
Repeat Sales: Company to have advocates in existing customers optimize the
technology in order to adjust its performance to customer’s needs. Moreover, it
delivers the features to both optimize and enhance the performance of the product
for given customers. Resources needed are feedback from the customers in order to
provide optimization, technology developers. Success of this activity is measured by
positive reviews received from customers.

Market-share Sales: Company manages issues and failures reported by the

customers in order to adjust the product accordingly. Moreover, due to maintenance
of positive relationships with customers company participates in discussions with
customers to both talk about the solution and its advantages. Resources needed are
company’s marketing communication specialists, because they manage relationships
with customers and are responsible to create the biggest amount of advocates
possible. Metrics used to measure are customer satisfaction and positive reviews. It’s
understood that more reviews and satisfaction helps to create bigger amount of
advocates in customers.

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Outlook
Disruption Threats for HAWK-EYE INNOVATIONS

• Disruption Description

Potential disruption can concern scrapping the cameras that provide the
object tracking technology in order to have the solution having putting
electronic chips or small sensors in balls that would provide the outcome of
the play without installing all the equipment in the venue. This solution would
be very basic in terms of visual presentation of the reviewed play, however
it’d decrease costs and this would be a significantly cheaper solution that one
proposed by Hawk-Eye Innovations.

• Potential Disruptor

The company that would be a potential disruptor is Goal-Line. They have

already tested the technology of microchip implanted in the ball that would
send the message to referee’s watch with a particular information. Having this
technology already tested, potential disruptor would only have to make this
solution more flexible and possible to implement to bigger number of sports.

• Disruption Type
o Low-End, New-Market, Asymmetric Customer Acquisition, Value
chain displacement, …
Type of disruption that would potentially take place is a low-end one.
Potential disruptor can propose a solution that addresses similar
problem, however it’s less advanced, but a lot cheaper. Having a
technology that costs considerably less, disruptor would be able to
offer its solution to sport organizations that are less wealthy than the
major ones, but in that way the market share will be increasing.

• Potential Impact

Considering presented disruption possibility, it would mark the end of an era

of object-tracking technology that is currently used by Hawk-Eye Innovation
and would mean a time for shifting to the technology that is based on
microchips implanted in tennis/football/basketball/baseball balls and retrieving
data from it to receive an information about the outcome of the play.

• Defence suggestions

Having a dominant position on the market, Hawk-Eye Innovation can prevent

a situation of being disrupted in two particular ways. First suggestion is to
develop its own technology of microchips – it’s possible for the company in
short amount of time, considering its resources and capabilities. Second
suggestion is to acquire the potential disruptor and have this technology as
an asset of Hawk-Eye Innovation. It’d also be possible, considering the fact
the company is a part of Sony, therefore there’s a significant potential for a
buyout.

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Innovation Opportunities for HAWK-EYE INNOVATIONS

• Opportunity Description

Implementing the technology that would allow limited amount of cameras or

one 360-degree camera to precisely track the movement of the object. It’d be
mounted at the central point of the court, regardless the sport. The
information about the object position and out/in play would be sent to the
referee of certain sporting event right away, therefore video review displayed
during the event would only serve as a confirmation of what system has
indicated in its operation.

• Type of Innovation

It’s type of the disruptive innovation, because it’d enhance the performance of
clarifying the controversial situation during sporting event, which is a
challenge to tackle. The effectiveness of the operation is improved, because it
could fully replace referees that make in/out calls during the competition.
Moreover, mounting one camera on the arena would also be more cost
effective, in comparison to having a tenths of cameras in the venue and a lot
of additional equipment.

• Jobs To Be Done
o Clarify the in/out situations during the sporting event – this is the main
job to be done when it comes to this innovation, so it means that it
doesn’t change in comparison to the initial one. Still, it’s needed to
provide a fair competition by eliminating any wrong calls made by
referees. Proposed innovation addresses this job to be done in more
effective way to the preceding technology.

• Early Adopters

The ones that would acquire the improved solution are minor sport
organization, that would take advantage of cheaper technology to implement
in their sporting events. Those organizations would represent both
federations of less popular sports that need a tool to clarify referees’ close
calls and organizers of minor competitions (on national and regional level).

• Existing Alternatives

Currently, there are no existing alternatives that use 360-degree camera for
object tracking and perform a video verification during the sporting event.
However, when jobs to be done are considered, the main alternatives are
Goal-Ref and Goal Control, however both of them use different technology,
so they should be perceived as indirect alternatives to the presented solution.

• Revenue Potential

Hawk-Eye Innovations could achieve increased revenue stream by spreading

its innovation throughout the market, especially offering it to minor sport
organizations, that normally wouldn’t afford the purchase of the current
system. Increased amount of contracts with customers would positively
impact company’s financial situation. Moreover, since the contract with sport

13
 organizations are the only revenue stream of the Hawk-Eye Innovations, it’d
help with its diversification, namely the existence of the company wouldn’t be
dependant on only few key accounts.

• Validation Suggestions (including Success Metrics)

The metrics that would indicate a success are:

o Revenue stream – it’s overall and percentage change;
o Number of customers – the innovation will be considered as a
business success, if amount of partnerships with customers increases;
o Margin of error – as it is with the current technology, the success of
the potential one could be measured with margin of error that system
has in comparison to the reality. The logic behind this metric is the
same – smaller margin of error means a better technology.

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 References
1. Hawk-Eye Innovations (2022): About Hawk-Eye,
https://www.hawkeyeinnovations.com/about, Description of company’s
key information and its vision.
2. Hawk-Eye Innovations (2022a): Our Technology,
https://www.hawkeyeinnovations.com/our-technology, This reference
provides key information about company’s most important products.
3. Global Database (2022): Company Financials,
https://uk.globaldatabase.com/company/hawk-eye-innovations-limited,
This reference provides the data about company’s financial
performance.
4. Harrod Sport (2018): Hawk-Eye technology in sport ,
https://www.harrodsport.com/advice-and-guides/hawkeye-technology-
in-sport, Article about the characteristics of the technology and the
reasons why it’s used.
5. Irish Times (2020): Revenue at Hawk-Eye company soars to €48m
due to VAR contracts,
https://www.irishtimes.com/business/technology/revenue-at-hawk-eye-
company-soars-to-48m-due-to-var-contracts-1.4132004, Article that
present financial information about the company but also presents the
key metrics that the company follows.
6. The Conversation (2012): A Hawk-Eye for detail: how accurate is
electronic judging in sport? , https://theconversation.com/a-hawk-
eye-for-detail-how-accurate-is-electronic-judging-in-sport-8136, Article
about the precision of the solution and concern about mistakes that
could be made.
7. BBC (2013): Hawk-Eye: From concept to game changer. ,
https://www.bbc.com/news/uk-22106087, Article that describe that
innovativeness that the solution brought to the traditional sports.

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