Clust.com: Dream More and Pay Less SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Clust.com: Dream More and Pay Less
Clust is a French group-buying Web site. Instead of marketing products to consumers, Clust is marketing aggregated consumer demands to manufacturers. Consequently, beyond the usual act of choosing among predefined alternatives, consumers are expected to bring up their demands and create new product ideas, to discuss and support the ideas of others, to call on their friends to join the Clust community, and to monitor the efforts of the Clust purchasing team. In fact, Clust holds no inventory beyond a warehouse to organize deliveries. No product is put on sale before enough supporters endorse it and 5%-40% discount on retail price can be secured. After a very interesting launch strategy, the Web site comes short of breath. Two pathways are outlined (focus on group-buying and good deals vs. focus on consumer creation and exclusives) with enough details to support decision making and evaluate both profitability and concept consistency.
Swot Analysis of "Clust.com: Dream More and Pay Less" written by Luc Wathieu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Clust Clust.com facing as an external strategic factors. Some of the topics covered in Clust.com: Dream More and Pay Less case study are - Strategic Management Strategies, Customers, Internet and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Clust.com: Dream More and Pay Less casestudy better are - – wage bills are increasing, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels,
geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Clust.com: Dream More and Pay Less
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Clust.com: Dream More and Pay Less case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Clust Clust.com, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Clust Clust.com 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 Clust.com: Dream More and Pay Less can be done for the following purposes –
1. Strategic planning using facts provided in Clust.com: Dream More and Pay Less case study
2. Improving business portfolio management of Clust Clust.com
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 Clust Clust.com
Strengths Clust.com: Dream More and Pay Less | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Clust Clust.com in Clust.com: Dream More and Pay Less Harvard Business Review case study are -
Effective Research and Development (R&D)
– Clust Clust.com has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Clust.com: Dream More and Pay Less - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Clust Clust.com in the sector have low bargaining power. Clust.com: Dream More and Pay Less has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Clust Clust.com to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Clust Clust.com is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Clust.com: Dream More and Pay Less Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Clust Clust.com has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Clust Clust.com to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Clust Clust.com is present in almost all the verticals within the industry. This has provided firm in Clust.com: Dream More and Pay Less 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.
Superior customer experience
– The customer experience strategy of Clust Clust.com in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Clust Clust.com is one of the most innovative firm in sector. Manager in Clust.com: Dream More and Pay Less Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Clust Clust.com is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Clust Clust.com is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Clust.com: Dream More and Pay Less Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Clust Clust.com has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Clust Clust.com 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Clust Clust.com digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Clust Clust.com has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Sustainable margins compare to other players in Sales & Marketing industry
– Clust.com: Dream More and Pay Less firm has clearly differentiated products in the market place. This has enabled Clust Clust.com to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Clust Clust.com to invest into research and development (R&D) and innovation.
Weaknesses Clust.com: Dream More and Pay Less | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Clust.com: Dream More and Pay Less are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Clust.com: Dream More and Pay Less, in the dynamic environment Clust Clust.com has struggled to respond to the nimble upstart competition. Clust Clust.com has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Clust Clust.com has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Clust.com: Dream More and Pay Less, 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.
Slow decision making process
– As mentioned earlier in the report, Clust Clust.com 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. Clust Clust.com 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.
Capital Spending Reduction
– Even during the low interest decade, Clust Clust.com has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High bargaining power of channel partners
– Because of the regulatory requirements, Luc Wathieu suggests that, Clust Clust.com 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.
Lack of clear differentiation of Clust Clust.com products
– To increase the profitability and margins on the products, Clust Clust.com needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Clust.com: Dream More and Pay Less HBR case study mentions - Clust Clust.com takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Clust Clust.com is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Clust.com: Dream More and Pay Less can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– It come across in the case study Clust.com: Dream More and Pay Less that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Clust.com: Dream More and Pay Less can leverage the sales team experience to cultivate customer relationships as Clust Clust.com is planning to shift buying processes online.
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 Clust Clust.com supply chain. Even after few cautionary changes mentioned in the HBR case study - Clust.com: Dream More and Pay Less, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Clust Clust.com vulnerable to further global disruptions in South East Asia.
Opportunities Clust.com: Dream More and Pay Less | 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 Clust.com: Dream More and Pay Less are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Clust Clust.com 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, Clust.com: Dream More and Pay Less, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Clust Clust.com to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Creating value in data economy
– The success of analytics program of Clust Clust.com has opened avenues for new revenue streams for the organization in the industry. This can help Clust Clust.com to build a more holistic ecosystem as suggested in the Clust.com: Dream More and Pay Less case study. Clust Clust.com can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Clust Clust.com in the consumer business. Now Clust Clust.com 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 Clust Clust.com to increase its market reach. Clust Clust.com 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Clust Clust.com can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Clust Clust.com can use these opportunities to build new business models that can help the communities that Clust Clust.com operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Clust Clust.com can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Clust Clust.com 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Clust Clust.com 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 Clust Clust.com to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Clust Clust.com 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Clust Clust.com in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Clust Clust.com is facing challenges because of the dominance of functional experts in the organization. Clust.com: Dream More and Pay Less case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Clust.com: Dream More and Pay Less External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Clust.com: Dream More and Pay Less are -
Shortening product life cycle
– it is one of the major threat that Clust Clust.com is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Clust Clust.com can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Clust Clust.com 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.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Clust Clust.com business can come under increasing regulations regarding data privacy, data security, etc.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Clust Clust.com with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Clust Clust.com 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Clust.com: Dream More and Pay Less, Clust Clust.com 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 .
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Clust Clust.com 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 Clust.com: Dream More and Pay Less .
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 Clust Clust.com in the Sales & Marketing sector and impact the bottomline of the organization.
Consumer confidence and its impact on Clust Clust.com 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.
Regulatory challenges
– Clust Clust.com needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Weighted SWOT Analysis of Clust.com: Dream More and Pay Less 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 Clust.com: Dream More and Pay Less 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 Clust.com: Dream More and Pay Less 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 Clust.com: Dream More and Pay Less 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 Clust.com: Dream More and Pay Less 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 Clust Clust.com needs to make to build a sustainable competitive advantage.