Category Archives: Uncategorized

Spotify – SWOT Analysis

Spotify’s slogan, “all the music, all the time,” is an incredibly accurate portrayal of my personal usage of the business’ services. The role Spotify plays in my life has grown over the past year to the point where I am certainly caught in the loyalty loop of the consumer decision journey and cannot go a day without using the app. With this company being the earliest music streaming service to attain 100 million monthly active users, it is evident I am not the only person hooked on Spotify.

 Running. Digital image. Run to Your Own Beat. Spotify, n.d. Web. 25 Oct. 2016.


Running. Digital image. Run to Your Own Beat. Spotify, n.d. Web. 25 Oct. 2016.

Spotify offers an enormous variety of music that appeals to many different tastes. Spotify is also highly accessible, as the service is available via phones and computers. Consumers lean towards Spotify, rather than other music-streaming services, largely due to price. Spotify is cheap for all users, but the option to skip ads and stream songs offline is available for $9.99 a month. This is extremely inexpensive, as this price point is equivalent to approximately ten songs on iTunes.  Spotify has been excellent at seizing opportunities presented to the company. For example, they provide a platform of music sharing for many developing artists, feature both originals and covers, offer playlists specifically for studying and working out, and even have gone as far as to feature podcasts. This openness to change has allowed significant growth. Other opportunities that can be capitalized on in the future include the rapid growth of technology and a change in attitudes towards streaming.

A weakness of the company is that consumer satisfaction with Spotify has lowered due to certain major artists, like Taylor Swift and Beyoncé, declining the streaming of their new music on this platform. The possibility of more artists doing so is a large threat to the success, as Spotify is heavily reliant on subscribers for attaining profits. It is stated that about 70% of revenue is deducted in order to pay owners of streamed content. This means that a major weakness of the company is that they have lower profitability than expected. The aforementioned statistic is also indicative of high supplier power, which is a threat to the business. If artists demand more profits per listen, this would cut deeply into the retained earnings of Spotify.  Other threats include high degree of rivalry and low switching costs of consumers. With so many options, such as Apple Music, Amazon, and Tidal, customer loyalty is not unwavering.  Despite such threats, it is evident that Spotify is very self-aware and have recently made strategic advances to increase their market share.  Potential acquisition of their competitor, SoundCloud, is explained thoroughly and helpfully through the use of concepts such as differentiation and competitive advantage in Mikaela Grange’s post.

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Brown, Claudia C. “Swot Analysis – Spotify.” Music Industry. N.p., 01 Jan. 2015. Web. 25 Oct. 2016.
“Spotify Solvay Case.” The Business Model. N.p., n.d. Web. 25 Oct. 2016.

Sustaining Netflix’s Advantage

According to Rita McGrath, there is no sustainability when it comes to competitive advantages. The idea of transient advantage is one in which advantages are short lived and constantly reinvented. When considering technologically-based businesses, such as Amazon, SnapChat and Netflix, this concept seems to hold true.  In Cyrus Cohen’s Blog, he discusses the ambitious reinvention of Amazon and their plan to rework its delivery strategy in depth. He explains the external forces that urge the company to make such changes in their operations. Similarly, in Hedy Hong’s blog, Snapchat’s development of spectacles, a tangible product, is identified as a response to the demand for innovation and product diversity. Both blogs touch on the need for constant development to sustain a competitive advantage. It is unclear if these endeavors will result in superior profits, but it is evident that these companies are attempting and prioritizing innovation.

 Netflix Logo. Digital image. Wikia. N.p., n.d. Web. 24 Oct. 2016.


Netflix Logo. Digital image. Wikia. N.p., n.d. Web. 24 Oct. 2016.

Having 57.4 million subscribers in 2014 and a projected growth to over 100 million for 2018, Netflix has established themselves as a major leader in their field. However, there is a high degree of rivalry in the online streaming business that is only increasing as time progresses and new competitors, like YouTube Red and Hulu, emerge and mimic Netflix’s value proposition. How does Netflix sustain their competitive advantage? Forbes attributes the creation of original media to retention of subscriber growth of this over the top content (OTT) market powerhouse. This is undeniably true, as one of the most recent Netflix original series, Stranger Things, reached 8.2 million people in nearly two weeks of release.

What I believe to be an understated strategy of Netflix is the inclusion of popular names in their original content to bring in wider audiences. This approach eases the workload of the marking department, as less effort is required to attract viewers. The company worked with Colleen Ballinger to produce Haters Back Off, an eight-episode series that was rel

 Digital image. The 100 Wikia. N.p., n.d. Web. 24 Oct. 2016.


Digital image. The 100 Wikia. N.p., n.d. Web. 24 Oct. 2016.

eased a week ago on the 14th of October. In doing so, Netflix was able to capitalize on the wildly popular YouTube personality of Miranda Sings and tap into her fan base on YouTube.  Similarly, casting Selena Gomez in The Fundamentals of Caring is another instance of this technique.

I would agree with Forbes’ claim, as I am constantly binge-watching Netflix originals such as the aforementioned Stranger Things and The 100. I would definitely not have a Netflix account if it weren’t for series like these. Additionally, due to the fact that my sister began using Netflix in order to watch content featuring these celebrities, I would say that Netflix’s constant stream of new ideas is incredibly effective that is sure to continue to secure large audiences in the future.

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McGrath, Rita Gunther. “The End of Competitive Advantage by Rita McGrath | Rita …” N.p., n.d. Web. 24 Oct. 2016.
“Netflix Gains 4.3 Million Subscribers in 4th Quarter – Jan …” N.p., n.d. Web. 24 Oct. 2016.
“Stranger Things: How Successful Was the Netflix Series?” N.p., n.d. Web. 24 Oct. 2016.
“Thanks To International Reach, Netflix On Track To Exceed 100 Million Subscribers By 2018.” Stockhouse. N.p., 23 Aug. 2016. Web. 24 Oct. 2016.

 

 

Philanthropic Strategy

In class we discussed that, in businesses, a strategy is a cohesive group of choices that position a company in such a way that financial returns are heightened in the long haul. It was noted that increasing financial returns was usually the objective. However, how does strategy change when the business is non-profit and revenue bears less significance?

non-profit-organization

Non Profit Organizations. Digital image. Non-profit Organizations. Clientaxinc, n.d. Web. 11 Oct. 2016.

Whether the business entity is for-profit or non-profit, there are countless similarities strategic procedures, such as tools and tactics. Both implement processes, like SWOT analyses (which we did for assignment one), to aid in establishing a competitive advantage in the given industry. However, key differences between the two lie in planning. There are variations in the planning process because the ultimate goals of NPOs and for-profit businesses are divergent. For benevolent organizations, the reason behind operation is dedication to certain social causes or advocating views, and maximizing profits is not the main priority. With that being said, non-profits must develop different criteria when deciding on things like target segments, communication strategies, and networking. For example when the planning process for non-profits seeks input from outsiders such as supporters and external stakeholders, unlike typical profit-oriented businesses in which only paid parties participate.

By providing clear, insightful steps for formulating an effective social media game plan specifically for non-profits, Alicia Johnston’s blog post, “A Strategic Guide to Social Media for Non-profits,” that the way companies approach something, like utilizing social media, varies depending on the type of business. It presents suggestions collected from non-profit experts that focus on increasing awareness, as well as acquisition, retention and engagement of donors, which are engaging topics I had not yet considered in my studies. Something I found particularly interesting from research was that there are tactics that allow non-profits to maneuver which would not be effective for profit-central businesses. For example, being a small NPO is an asset as the staff is able to pay special attention to those they are serving, whereas being a small for-profit organizations could equate to incapability to compete with established adversaries.

As a former executive of two high school clubs devoted to raising money for various causes, I wish I had done research on this topic sooner. It would have allowed us to further our mission more effectively through implementation of NPO-specific strategies rather than more familiar ones used by profit-driven companies. I could only imagine how superior these clubs would’ve been if we knew how to understand and position ourselves in the business landscape and execute properly according to our goals.

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Johnson Alicia. “Strategic Guide to Social Media for Nonprofits | Sprout Social.” Sprout Social. N.p., 2016. Web. 02 Oct. 2016.

“Strategic Planning for Nonprofits Vs. Profits.” Small Business. N.p., n.d. Web. 02 Oct. 2016.

“What Does a Good Nonprofit Strategic Plan Look Like?” Nonprofit Answer Guide. N.p., n.d. Web. 02 Oct. 2016.

 

More Pay, More Worries?

As somebody who is admittedly not the most devoted follower of the news, I was utterly blindsided by the increase in minimum wage once September rolled around. I was employed as a cashier at McDonalds this spring, earning $10.45 an hour until resigning in the final week of August. My initial thoughts on the matter were selfish and rooted in frustration, due to the fact that the rise had not occurred sooner. Delving deeper into this topic and viewing it from a large-scale perspective, I’ve acquired awareness on the matter and am perplexed by the number of opponents to the change.

Although a multitude of minimum wage workers are supporters of this change, there are various groups of individuals that view it as a horrible detriment. The BC Chamber of Commerce, in particular, is uneasy about the possible effects small businesses. They argue that, at first glance, paying an employee 40 cents extra might seem miniscule, but expenses drastically rise in comparison to revenue when you multiply that by an army of employees. As a result, companies will hunt for methods of cutting costs to the detriment of low-income workers. Such activities could include cutting hours, requiring more from applicants and charging customers more.

The above visual eliminates the myth that increasing minimum wage only assists teens in making money and underlines the need for a change.

The Case for Increasing the Minimum Wage. Digital image. Policy Alternatives. N.p., 14 Apr. 2015. Web. 25 Sept. 2016.   The above visual eliminates the myth that increasing minimum wage only assists teens in making money and underlines the need for a change. (click image for full picture)

This excessive amount of backlash begs the question: was heightening the minimum wage a misstep by the government? British Columbia simultaneously held the title of most expensive province to live in and the lowest base pay in Canada. Evidently, the 40 cent rise to wages across B.C was long overdue. This change is designed to alleviate the stress of financial instability on those who work at the legal minimum to support themselves and their families.

Proponents, like the B.C. Federation of Labour, stress that this is not enough and are lobbying for an instantaneous minimum wage increase to $15.00. Despite the animosity towards a 40 cent increase, a large jump like this is plausible especially now that small business tax rate has been scaled down. Correspondingly, businesses can maintain current profits while affording to pay workers more. Places like California and Alberta have already made this move and have experienced a majorly positive outcome.

With proof of success, I would classify myself as an advocate of the minimum wage increase to $15.00. Investing in human capital assists both those affected by poverty and businesses by increasing worker productivity. A rapid upsurge in minimum wage is something I hope for in the near future because of how much I long for higher pay during summer jobs and how beneficial it would be to everyone in the economy.

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“BC Chamber Responds to Minimum Wage Increases.” BC Chamber of Commerce. N.p., 04  May 2016. Web. 25 Sept. 2016.

Boynton, Sean. “No One Happy about B.C.’s Minimum Wage Increase.” Global News No One Happy about BCs Minimum Wage Increase. N.p., 15 Sept. 2016. Web. 25 Sept. 2016.

“Small Increase in Minimum Wage Will Leave 500,000 BC Workers Earning Poverty Wages.” Bcfed.ca. N.p., 15 Sept. 2016. Web. 25 Sept. 2016.

Zussman, Richard. “B.C. Minimum Wage to Hit $11.25 by 2017 – British Columbia – CBC News.” CBCnews. CBC/Radio Canada, 05 Apr. 2016. Web. 25 Sept. 2016.

Mylan: Pharmacists or Greed-driven Strategists?

After obtaining the rights to the EpiPen in 2007, Mylan is now the one and only supplier of this life-saving medical device in the United States. Since then, the price of two syringes has risen over 400%. Needless to say, this extreme spike in cost was not a popular decision. This debacle has triggered political figures, such as Hillary Clinton, and major entities, like the American Medical Association, to assert their opinions against the decisions of Mylan Pharmaceuticals.

 EpiPen Price Hurts. Digital image. Matt Davie's Political Cartoons. Matt Davie, 24 Aug. 2016. Web. 10 Sept. 2016.


EpiPen Price Hurts. Digital image. Matt Davie’s Political Cartoons. Matt Davie, 24 Aug. 2016. Web. 10 Sept. 2016.

Why are people so overwhelmingly against what Mylan has done? As depicted by the 200,000 annual trips to the emergency room and over 200 annual deaths caused by allergen-induced anaphylaxis, allergies have the potential to be deadly.  When anaphylaxis occurs, it is imperative that the victim visits emergency room immediately, or uses an EpiPen. Now that it costs roughly $600 for two injections that have a storage time of 18 months, the EpiPen becomes less attainable for those with tighter incomes.

Is it ethical to put such an elevated price on something required for survival? In Corporate Ethics and Corporate Governance, the write states “only people have responsibilities”. It is difficult to condemn the minds of Mylan on the basis that their main responsibility is to generate the maximum amount of profit. By setting a dramatic price while operating under government laws and regulations, they meet their goal. However, it becomes an issue regarding ethics once it becomes a matter of life and death. Mylan is composed of an abundance of people who have the capability to have collective social responsibilities. With that being said, I perceive Mylan’s actions to be unethical because they are essentially giving their customers no other choice but to pay more to live safely.  I experience difficulty breathing and hives after unknowingly consuming mushrooms. I know exactly how easy it is to expose yourself to something you are not supposed to. It is shocking to think that if my reactions had been more severe, I could have died due to the lack of a presence of an EpiPen.

According to Freeman’s Stakeholder Theory, success if found when every group of a business is taken into consideration. By setting such towering prices, Mylan is causing customers to question the value of their product and how badly they actually need it. Down the road, consumers may decide to simply deem their product unaffordable and take their chances. The infuriated public’s opinion continually being disregarded could result in the tarnishing of their company image and reputation. This unethical move could result in a decline in the business. Although their strategy is maximizing profit, this may not be the best idea in the long-run.

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“AAFA.” Allergy Facts. N.p., n.d. Web. 10 Sept. 2016.
“AllergicChild.” AllergicChild. N.p., n.d. Web. 10 Sept. 2016.
Clicking, By. “The Official Website for EpiPen® (epinephrine) and EpiPen Jr® (epinephrine) Auto-
Injectors.” EpiPen. N.p., n.d. Web. 10 Sept. 2016.
“Facts and Statistics – Food Allergy Research & Education.” Facts and Statistics – Food Allergy Research & Education. N.p., n.d. Web. 10 Sept. 2016.
“The Fix to EpiPen’s High Cost Still Hurts Consumers.” Time. Time, 25 Aug. 2016. Web. 10 Sept. 2016.