Case Study Description of iTV: Marketing Interactive Services
The former Cable & Wireless Hongkong Telecom (HKT) launched the world's first commercial interactive television (iTV) service with a fanfare in March 1998. Nevertheless, its performance in the first two years of operations had not lived up to the company's expectations. Many still saw it as a traditional pay television service instead of a multimedia interactive service. Meanwhile, the company began to shift the focus to its broadband Internet service. In August 2000, HKT was taken over by Pacific Century Cyberworks (PCCW). The main focus of PCCW was the Network of the World (NOW) project, a convergence service of telecommunications, computing, and television technologies independent of the distribution platform. This case describes the marketing efforts made by HKT in the first two years of iTV's operation. It examines how, if possible, iTV could fit into the newly merged company, and outlines the initial marketing strategy of NOW, a new digital convergence service.
Swot Analysis of "iTV: Marketing Interactive Services" written by Ali F. Farhoomand, Eva Chang includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Itv Hkt facing as an external strategic factors. Some of the topics covered in iTV: Marketing Interactive Services case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the iTV: Marketing Interactive Services casestudy better are - – wage bills are increasing, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, technology disruption,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of iTV: Marketing Interactive Services
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in iTV: Marketing Interactive Services case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Itv Hkt, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Itv Hkt operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of iTV: Marketing Interactive Services can be done for the following purposes –
1. Strategic planning using facts provided in iTV: Marketing Interactive Services case study
2. Improving business portfolio management of Itv Hkt
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Itv Hkt
Strengths iTV: Marketing Interactive Services | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Itv Hkt in iTV: Marketing Interactive Services Harvard Business Review case study are -
Ability to lead change in Sales & Marketing field
– Itv Hkt is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Itv Hkt in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Itv Hkt are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Low bargaining power of suppliers
– Suppliers of Itv Hkt in the sector have low bargaining power. iTV: Marketing Interactive Services has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Itv Hkt to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Sales & Marketing industry
– iTV: Marketing Interactive Services firm has clearly differentiated products in the market place. This has enabled Itv Hkt to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Itv Hkt to invest into research and development (R&D) and innovation.
Organizational Resilience of Itv Hkt
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Itv Hkt does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Itv Hkt is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Itv Hkt in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Itv Hkt is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Ali F. Farhoomand, Eva Chang can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Innovation driven organization
– Itv Hkt is one of the most innovative firm in sector. Manager in iTV: Marketing Interactive Services Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Itv Hkt has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Itv Hkt has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Training and development
– Itv Hkt has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in iTV: Marketing Interactive Services Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Diverse revenue streams
– Itv Hkt is present in almost all the verticals within the industry. This has provided firm in iTV: Marketing Interactive Services case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses iTV: Marketing Interactive Services | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of iTV: Marketing Interactive Services are -
High operating costs
– Compare to the competitors, firm in the HBR case study iTV: Marketing Interactive Services has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Itv Hkt 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Itv Hkt is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study iTV: Marketing Interactive Services can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Itv Hkt has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - iTV: Marketing Interactive Services should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Itv Hkt is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Itv Hkt needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Itv Hkt to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Ali F. Farhoomand, Eva Chang suggests that, Itv Hkt is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Slow decision making process
– As mentioned earlier in the report, Itv Hkt has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Itv Hkt even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study iTV: Marketing Interactive Services, is just above the industry average. Itv Hkt needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Need for greater diversity
– Itv Hkt has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Interest costs
– Compare to the competition, Itv Hkt has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Itv Hkt supply chain. Even after few cautionary changes mentioned in the HBR case study - iTV: Marketing Interactive Services, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Itv Hkt vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study iTV: Marketing Interactive Services, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Opportunities iTV: Marketing Interactive Services | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study iTV: Marketing Interactive Services are -
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Itv Hkt in the consumer business. Now Itv Hkt can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Itv Hkt to increase its market reach. Itv Hkt will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Leveraging digital technologies
– Itv Hkt can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Building a culture of innovation
– managers at Itv Hkt can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Low interest rates
– Even though inflation is raising its head in most developed economies, Itv Hkt can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Itv Hkt to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Itv Hkt to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Itv Hkt can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. iTV: Marketing Interactive Services suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Loyalty marketing
– Itv Hkt has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Learning at scale
– Online learning technologies has now opened space for Itv Hkt to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Itv Hkt can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, iTV: Marketing Interactive Services, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Itv Hkt can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Itv Hkt can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Itv Hkt can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats iTV: Marketing Interactive Services External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study iTV: Marketing Interactive Services are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study iTV: Marketing Interactive Services, Itv Hkt may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Stagnating economy with rate increase
– Itv Hkt can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Itv Hkt in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Itv Hkt can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study iTV: Marketing Interactive Services .
High dependence on third party suppliers
– Itv Hkt high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Shortening product life cycle
– it is one of the major threat that Itv Hkt is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Itv Hkt
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Itv Hkt.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Itv Hkt will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Consumer confidence and its impact on Itv Hkt demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Itv Hkt.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Itv Hkt with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Itv Hkt in the Sales & Marketing sector and impact the bottomline of the organization.
Weighted SWOT Analysis of iTV: Marketing Interactive Services Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study iTV: Marketing Interactive Services needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study iTV: Marketing Interactive Services is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study iTV: Marketing Interactive Services is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of iTV: Marketing Interactive Services is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Itv Hkt needs to make to build a sustainable competitive advantage.
