Thomas Coyne –

Gabriel Boullenger –
David Zistll –
Fillippo Maria Zanchi – 3024255
Victor Gondry -
Nina Podolsky - 3015918
Table of Contents

1 Introduction

2 Industry Analysis

3 Financial and Operational Analysis

4 SWOT Analysis

5 Competitive Advantage Analysis

 INTRODUCTION The Evolution:
2002: the Birth
o Nick Woodman founds GoPro First GoPro (2004):
o Scope: selling affordable Action Cameras  Analog camera
 Capture only photos
2007 – 2013: the Golden
o Numerous product releases
Era
o GoPro Cult is built
o Double-digit yearly growth GoPro HERO (2006):
 Digital camera
2014: the IPO  Record videos with no sound
o Shares price triple in first six
months
GoPro HERO 3 (2012):
o Various unproductive acquisitions
2016-2018: the  4k video quality
oDecline
GoPro experiences financial  Built-in Wi-fi

losses  Compatible with GoPro App

o Shares price is one-fourth of the IPO

MAIN PROBLEMS
Motivations

 Action-cameras market is matured

• Slowing Demand  Increasing competition from substitutes

(e.g. Smartphones, Drones)

 Cheaper alternatives from competitors

 Lack of new product lines

• Decaying Brand (e.g. exit from the drone market)

Image  Multiple layoffs

 Bad track of missing targets

 Operational stumbles
INDUSTRY ANALYSIS
Industry Structure

Low number of direct competitors but many

substitutes (smart phones)

Low differentiation in product design, high

differentiation in technological capabilities

Strategic Group
Analysis
North America (40%), Europe (20%)
and Asia-Pacific (35%) as the three
main markets (5% ROW)
Sony and Garmin are the main
competitors in the high price segment
(500-800€)
Largely growing demand for private
use of action cameras
 Buyer Power Threat of new entry
• Low bargaining power • Low threat
• Many consumers within • Market is very saturated
market • Branding and brand loyalty plays a
• Avg. consumer buys 1 large part
GoPro at a time (no bulk • Distribution channel required,
purchase discounts) from manufacturing to retail
• Certain degree of Competitive rivalry stores
‘locking in’ consumer • Very high
with product specific • GoPro’s cult phase is over
accessories • Many firms compete either
• Very few perfect directly or indirectly
substitutes • Consumer have moved onto
different products, such as
drones and HD smart phones Threat of substitution
Supplier Power • Medium threat
• Low bargaining power
• Large number of suppliers, • Very few perfect substitutes that offer same
with substitutable parts performance (HD, long battery life, ‘action-proof’)
• Diverse distribution channel • Similar substitutes for action camera, such as
smartphones, drones, professional equipment
• Constant demand for new/better cameras
FINANCIAL STATUS AND
COST ANALYSIS 2015 - Going Well
 Product range expansion by 14
consumer drones and 4 acquisitions.
 Increase in revenues by 34 % from
2014.

2016 - Disaster!
 Consumer drone sales (half of the groups
total revenues) dropped by -27 %.
 Average cost of GoPro: $250
 Why? Entry of big competitors – such as
 Gross Profit Margin in 2018: 38%
Chinese DJI - in the same segment.
 Estimated cost of production: $95

2017 - Recovering and Refocusing

 Reorganization plan: cut costs and realign
the business around consumer and
commercial civil drones.
 Revenues were still relatively high
because commercial drone revenues
increased by +36 % from last year.
 Low stock price
GoPro VALUE CHAIN
ANALYSIS

 Planning
 Financing
 Investors relations
2016 - Disaster!
 Consumer drone sales (half of the groups
 Recruitment total revenues) dropped by -27 %.
 Training
 Why? Entry of big competitors – such as
Chinese DJI - in the same segment.
 Product design
 Market research

2017 - Recovering and Refocusing

 Machines
 Data
 Reorganization plan: cut costs and realign
the business around consumer and
 Cover front made of  Cameras supplied  Completely  In 2008 the
commercial
 Cameras
civil drones.
thermoplastic in Shenzhen automated system company spent guaranteed for 2
 Soda ash,  Then sent to Hong  Monitoring of the rest  Revenues
more than years
$222,096,000 in
were still relatively high
limestone and Kong of the supply chain is  Online customer
dolomite to make
lenses
 GoPro
warehousing
easier because
sales and marketing
expenditure

commercial drone revenues
service
Instructions in


Image sensors
Chips
increased by +36 % from last year.
many languages

 Low stock price

GoPro TODAY

STRENGTHS WEAKNESSES

 Stock price low

 Well known in the action cameras
 Tough financial situation
market
 Revenues falling
 Compatible accessories  Higher prices compared to others
 Word of mouth  Competitors are becoming stronger
 Crowdsourcing of new ideas  High reliance on retailers
 Sell an experience rather than a
product

OPPORTUNITIES T H R E AT S

 Virtual reality  Niche market with high saturated

 Drone market potential competition
 Social network presence  Industry giants like Sony
 Price competition
 Threat of substitutes
GoPro Competitive Advantage
Unique competitive advantage point:
BRAND IMAGE
 Associated with adventure and adrenaline
Social Media Pages:
• Instagram: 15.5 million followers
• Facebook: 10.7 million followers
• YouTube: 6.8 million subscribers
• Twitter: 2.2 million followers

 Mostly relies on user generated content

Is it sustainable?: YES!
which it shares through social media
As long as image stays the same
 Sponsors extreme sports athletes
Unlikely that an incumbent or new
entrant levels up with them in terms of
brand awarness.

Image could be damaged by:

1. A significant technological gap between

them and competition

2. (Another) scandal regarding its main

products
Thank You
 References
Slide 3
• Parrot Store (2018). Panel EN - Edito - Business Solutions. [online] Available at: https://www.parrot.com/business-solutions-uk/#business-solutions
[Accessed 12 Mar. 2018].
• Parrot 2017 third quarter business and earnings, Press release, 13th November 2017, Paris

Slide 4
• Gartner.com. (2017). Gartner Says Almost 3 Million Personal and Commercial Drones Will Be Shipped in 2017. [online] Available at:
https://www.gartner.com/newsroom/id/3602317 [Accessed 12 Mar. 2018].

Slide 5-6
• https://www.balderton.com/news/a-primer-on-drones-and-uavs-part-2-where-are-the-investment-opportunities
• Business Insider. (2017). Drone market shows positive outlook with strong industry growth and trends. [online] Available at:
http://www.businessinsider.com/drone-industry-analysis-market-trends-growth-forecasts-2017-7?IR=T [Accessed 12 Mar. 2018].
• Valentak, Z. (2017). Drone market share analysis & predictions for 2018 - DJI dominates, Parrot and Yuneec slowly catching up - DronesGlobe.com. [online]
DronesGlobe.com. Available at:
• http://www.dronesglobe.com/news/drone-market-share-analysis-predictions-2018/ [Accessed 12 Mar. 2018].

• Slide 7

Financial report 2017

• https://corporate.parrot.com/en/financialpublications/2017businessandearnings
Financial report 2016
• https://corporate.parrot.com/en/financialpublications/2016financialpublications/2016fourth-quarterearnings
Financial report 2015
• https://corporate.parrot.com/en/financialpublications/2015financialpublications/pressreleaseparrotq42015earnings
Stock price
• https://www.reuters.com/finance/stocks/chart/PARRO.PA

Slide 8
• https://newatlas.com/dji-spark-parrot-bebop-2-comparison/50545/
• https://newatlas.com/phantom-3-vs-3dr-solo-vs-bepop-2-comparison/40468/

Slide 10
• https://www.fool.com/investing/2017/03/27/what-is-gopro-incs-competitive-advantage.aspx