Case Analysis

Tweeter etc.

Section-C | Group-8
Abhishek | Aditi | Ankush | Hassang | Iksha | Prayas

1
Introduction
• Sandy Bloom berg, w ho served as the business's CEO, founded Tweeter etc. in 1972.

• It is a specialty retailer of m iddle- and high-end consum er electronics for audio and video. It grew
from a 13-store chain w ith annual sales of $35 m illion in 1991 to a 21-store chain w ith annual sales
of $ 82 m illion in 1996.

• In 1993, they responded by introducing the "Autom atic Protection Price" (APP) as the m ain
com ponent of the strategy to restore consum er confidence in prices.

• In the APP, Tweeter keeps an eye on local newspaper ads and autom atically notifies the custom er
to check their return policy if the product they had just purchased had been advertised at a lower
price by a rival.

• Three years later, in 1996, the tweeter questioned w hether nuclear power plants' current
com petitive positioning was im pacted by the nuclear industry.

2
Problem Identification

• To assess the continued viability of Tweeter Inc.'s Autom atic Price Protection (APP)
strategy considering the new environm ent, particularly because it failed to significantly
affect the sales of its acquired subsidiary.

• To develop a new m arketing strategy that would alter the consum er's perception that the
brand was expensive

3
5C Analysis

COMPANY
CUSTOMER
• Small upscale New England’s
retailer of consumer electronics • Entry-level Customers
• Price Biter
• Audio and Video equipment
• Convenience Customer
• Present in the market for a long
• Quality/Service
time - 21 stores in 1996

COLLABORATORS
• Bryn Mawr Stereo

COMPETITORS CONTEXT
• Lechmere • Bad Economic conditions in
• Circuit City '87-'88
• Cambridge Soundworks • Seasonal Factor
• The Wiz • High Bargaining Power of
Consumer

4
Comparing Pricing

5
Recommendations

• 3-pronged attack strategy m ay no longer work for Tweeter in the current structure

• Reason for this is the entrance of ‘Nobody Beats the w iz’ in the New England m arket

• W iz is know n for its rock bottom pricing across different product categories w hich w ill
negate APP policy of Tweeter and Tweeter m ay suffer w ith heavy losses

• We suggest that they should m odify APP policy and turn it into 110% refund of price
difference in form of ‘Store coupons’

• This w ill increase the frequency of visits by the custom ers and m ore chances that
custom ers w ill buy products of greater price.