Using Groupon for Health and Wellness Businesses SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Using Groupon for Health and Wellness Businesses
Social merchants are small business owners and entrepreneurs who adopt social shopping as a new sales channel. They employ social shopping intermediaries, such as Groupon and LivingSocial, to promote their products or services to price-sensitive customers at large discounts. The success of social merchants depends in part on the reputation they gain at merchant review sites (e.g., Yelp, TripAdvisor, Angie's List), via which consumers post online product and merchant reviews. An analysis of social shopping provides insight regarding how social shopping works and what merchants must be aware of if they utilize social shopping intermediaries. This article shares these insights in the context of a set of health and wellness merchants that were studied for five years. Specifically, this article discusses how their Groupon daily deals affect merchant reviews, and how surviving vs. failed social merchants differ in terms of their review scores and number of reviews. Finally, this article provides recommendations about merchant review management to health and wellness merchants.
Authors :: In Lee
Topics :: Sales & Marketing
Tags :: Public relations, Social platforms, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "Using Groupon for Health and Wellness Businesses" written by In Lee includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Merchants Merchant facing as an external strategic factors. Some of the topics covered in Using Groupon for Health and Wellness Businesses case study are - Strategic Management Strategies, Public relations, Social platforms and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Using Groupon for Health and Wellness Businesses casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, technology disruption, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels,
there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Using Groupon for Health and Wellness Businesses
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Using Groupon for Health and Wellness Businesses case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Merchants Merchant, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Merchants Merchant 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 Using Groupon for Health and Wellness Businesses can be done for the following purposes –
1. Strategic planning using facts provided in Using Groupon for Health and Wellness Businesses case study
2. Improving business portfolio management of Merchants Merchant
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 Merchants Merchant
Strengths Using Groupon for Health and Wellness Businesses | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Merchants Merchant in Using Groupon for Health and Wellness Businesses Harvard Business Review case study are -
Sustainable margins compare to other players in Sales & Marketing industry
– Using Groupon for Health and Wellness Businesses firm has clearly differentiated products in the market place. This has enabled Merchants Merchant to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Merchants Merchant to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Merchants Merchant 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 Using Groupon for Health and Wellness Businesses - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Merchants Merchant has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Strong track record of project management
– Merchants Merchant is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Merchants Merchant has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Using Groupon for Health and Wellness Businesses 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.
Ability to lead change in Sales & Marketing field
– Merchants Merchant 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 Merchants Merchant in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Merchants Merchant is one of the leading recruiters in the industry. Managers in the Using Groupon for Health and Wellness Businesses are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Using Groupon for Health and Wellness Businesses 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.
Highly skilled collaborators
– Merchants Merchant has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Using Groupon for Health and Wellness Businesses HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Merchants Merchant has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Merchants Merchant to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Merchants Merchant in the sector have low bargaining power. Using Groupon for Health and Wellness Businesses has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Merchants Merchant to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Merchants Merchant has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Merchants Merchant 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.
Weaknesses Using Groupon for Health and Wellness Businesses | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Using Groupon for Health and Wellness Businesses are -
Increasing silos among functional specialists
– The organizational structure of Merchants Merchant is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Merchants Merchant needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Merchants Merchant to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Using Groupon for Health and Wellness Businesses, in the dynamic environment Merchants Merchant has struggled to respond to the nimble upstart competition. Merchants Merchant has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Using Groupon for Health and Wellness Businesses 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 Using Groupon for Health and Wellness Businesses can leverage the sales team experience to cultivate customer relationships as Merchants Merchant is planning to shift buying processes online.
Lack of clear differentiation of Merchants Merchant products
– To increase the profitability and margins on the products, Merchants Merchant needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Merchants Merchant, firm in the HBR case study Using Groupon for Health and Wellness Businesses needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Merchants Merchant needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Skills based hiring
– The stress on hiring functional specialists at Merchants Merchant 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Merchants Merchant is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Using Groupon for Health and Wellness Businesses can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Using Groupon for Health and Wellness Businesses, is just above the industry average. Merchants Merchant 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.
High cash cycle compare to competitors
Merchants Merchant has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow decision making process
– As mentioned earlier in the report, Merchants Merchant 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. Merchants Merchant 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.
Opportunities Using Groupon for Health and Wellness Businesses | 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 Using Groupon for Health and Wellness Businesses are -
Using analytics as competitive advantage
– Merchants Merchant has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Using Groupon for Health and Wellness Businesses - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Merchants Merchant to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Merchants Merchant 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Merchants Merchant 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 Merchants Merchant to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Merchants Merchant can use these opportunities to build new business models that can help the communities that Merchants Merchant operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Developing new processes and practices
– Merchants Merchant 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.
Loyalty marketing
– Merchants Merchant 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.
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 Merchants Merchant in the consumer business. Now Merchants Merchant can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Merchants Merchant 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.
Manufacturing automation
– Merchants Merchant can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Building a culture of innovation
– managers at Merchants Merchant 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.
Leveraging digital technologies
– Merchants Merchant 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.
Creating value in data economy
– The success of analytics program of Merchants Merchant has opened avenues for new revenue streams for the organization in the industry. This can help Merchants Merchant to build a more holistic ecosystem as suggested in the Using Groupon for Health and Wellness Businesses case study. Merchants Merchant can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Merchants Merchant 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.
Threats Using Groupon for Health and Wellness Businesses External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Using Groupon for Health and Wellness Businesses are -
Consumer confidence and its impact on Merchants Merchant 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.
Shortening product life cycle
– it is one of the major threat that Merchants Merchant is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Merchants Merchant 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.
Technology acceleration in Forth Industrial Revolution
– Merchants Merchant has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Merchants Merchant needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
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 Merchants Merchant in the Sales & Marketing sector and impact the bottomline of the organization.
Environmental challenges
– Merchants Merchant needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Merchants Merchant can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Using Groupon for Health and Wellness Businesses, Merchants Merchant 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Merchants Merchant with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Merchants Merchant 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Merchants Merchant 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.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Merchants Merchant needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing wage structure of Merchants Merchant
– 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 Merchants Merchant.
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 Merchants Merchant business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Using Groupon for Health and Wellness Businesses 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 Using Groupon for Health and Wellness Businesses 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 Using Groupon for Health and Wellness Businesses 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 Using Groupon for Health and Wellness Businesses 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 Using Groupon for Health and Wellness Businesses 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 Merchants Merchant needs to make to build a sustainable competitive advantage.
