TiVo in 2002: Consumer Behavior

Abha Bhuskute Vijaya Suryavanshi Kaniz Aeliya Sahil Agarwal 10P133 10P179 10P205 10P228

Group 8

2002) as compared to initial forecasts ‡ TiVo has been losing money for the past 3 years ‡ Huge cost of sales and marketing have little to show for it Consumer Behaviour .Creator and pioneer of the DVR also known as PVR ‡ TiVo¶s appeal . a nationwide electronic store ‡ Slow growth in subscriber addition (380.Innovation in features and product ‡ Early on. TiVo had some success among young single men. and exclusive retailer Best Buy.2 Case background ‡ TiVo. Inc. and now enjoys the same success with higher income families ‡ TiVo partnered with the satellite service provider. DirecTV.000 in March. was incorporated in 1997 .

3 Issue ‡ Precarious financial position ‡ Number of subscribers to TiVo is substantially lower than previously forecasted ‡ Subscriber profiles are narrow. including PVR and DVR. indicating a small target market ‡ Promotion of the TiVo category. relatively low Consumer Behaviour .

family households and single men with higher annual incomes. low and middle income households (<50K). and welleducated ‡ Singles (female).4 Narrow consumer profiles ‡ Saturation of TiVo within specific consumer segments . the young (<25 yrs) and the elderly consumer (>54 yrs) remain a small percentage of TiVo subscribers ‡ 7% are single women ‡ Only 3% are between 18 and 25 years old ‡ People with annual incomes below $50K are less than 25% of the subscriber base Consumer Behaviour .

but subscriber growth has been below expectations Consumer Behaviour .5 High customer satisfaction. but poor growth ‡ 90% of customers are satisfied ‡ > 95% would recommend the product ‡ > 80% enjoy TV more after purchasing TiVo ‡ Satisfaction level over 90% proving the products quality and usability.

trying to apply same functions in nonTiVo situations Consumer Behaviour . so marketing efforts end up being focused on an already existing and well-penetrated segment ‡ No recent research conducted in other niches such as lowincome households or people under 25 years old ‡ Big influence of friends & family in purchase decision ‡ Qualities are not ³tasted´ until it is personally experienced ‡ Good post purchase Behavior ± survey suggests that existing customer will most likely recommend it to others ‡ Fascinated by TiVo .6 Consumer Behaviour ‡ Positioning based on consumer behavior within a certain segment only.

making them dependable on it Expanding customer base by targeting different categories Minimizing marketing costs at the same time increasing sales to create healthy cash flow Consumer Behaviour .7 ´Breaking Through the Inertiaµ Converting liking for the product in actual purchase and increasing profits Making people realize TiVo as life changing product.

and can greatly influence future purchases among family members and friends ‡ Leverage this high customer satisfaction and influence by offering ³referral discounts´ in the form of discounts off of monthly subscription rates ‡ Quickest way to improve financials is to increase sales/subscriptions ‡ Reposition TiVo in terms of pricing and product offering to make it more acceptable to different customer segments Consumer Behaviour .8 ´Breaking Through the Inertiaµ ‡ TiVo customers are fiercely loyal to their TiVo.

9 Recommendations ‡ Customers like to maximize benefits from resources they spend Provide free subscription for 3 months to tie the customers to their products Provide Referral benefits to its existing customers. Existing customers referring new customers will get referral money Repositioning TiVo¶s Value Proposition Upfront Discount in prices Indirect reduction in prices by reducing ownership costs Special time-bound discounts for lean periods Discounted Gift packs (subscription pre-paid) for Christmas/New years etc Consumer Behaviour ‡ .

use more cable providers and retailers Provide retailer support in the way of retail demonstrations and sales person training Consumer Behaviour .10 Recommendations ‡ Make use of Super bowl experiment findings to convince advertisers and network operators how TiVo can be beneficial to them as well ‡ Improve distribution system.

11 Thank you! .

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