CardSwap: Converting Unwanted Gift Cards into Cash SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CardSwap: Converting Unwanted Gift Cards into Cash
The co-founder of CardSwap.ca sat at his desk in the Toronto office from which he managed the company. CardSwap was an online service that provided consumers with the opportunity to convert unwanted gift cards into hard cash. The co-founder felt convinced that his small Canadian company created great value for its customers. After all there were around a billion dollars of unwanted gift cards entering circulation every year. People who owned these unwanted gift cards would surely want to use the CardSwap service. CardSwap could offer a strong value proposition to consumers while ensuring a healthy return through commissions on every transaction. Problems remained however CardSwap was a relatively small company and had no access to the multi-million dollar advertising budgets that might be needed to get a message out to consumers through an extensive multi-media strategy. How much should the company be willing to spend to acquire a customer? How best could this new company use its limited resources to communicate to customers the benefits that CardSwap had to offer?
Swot Analysis of "CardSwap: Converting Unwanted Gift Cards into Cash" written by Neil Bendle, Michael Taylor includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cardswap Unwanted facing as an external strategic factors. Some of the topics covered in CardSwap: Converting Unwanted Gift Cards into Cash case study are - Strategic Management Strategies, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the CardSwap: Converting Unwanted Gift Cards into Cash casestudy better are - – central banks are concerned over increasing inflation, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs,
wage bills are increasing, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of CardSwap: Converting Unwanted Gift Cards into Cash
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CardSwap: Converting Unwanted Gift Cards into Cash case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cardswap Unwanted, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cardswap Unwanted 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 CardSwap: Converting Unwanted Gift Cards into Cash can be done for the following purposes –
1. Strategic planning using facts provided in CardSwap: Converting Unwanted Gift Cards into Cash case study
2. Improving business portfolio management of Cardswap Unwanted
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 Cardswap Unwanted
Strengths CardSwap: Converting Unwanted Gift Cards into Cash | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cardswap Unwanted in CardSwap: Converting Unwanted Gift Cards into Cash Harvard Business Review case study are -
High switching costs
– The high switching costs that Cardswap Unwanted 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.
Superior customer experience
– The customer experience strategy of Cardswap Unwanted in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Sales & Marketing field
– Cardswap Unwanted 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 Cardswap Unwanted in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Cardswap Unwanted in the sector have low bargaining power. CardSwap: Converting Unwanted Gift Cards into Cash has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cardswap Unwanted to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Cardswap Unwanted has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cardswap Unwanted 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.
Sustainable margins compare to other players in Sales & Marketing industry
– CardSwap: Converting Unwanted Gift Cards into Cash firm has clearly differentiated products in the market place. This has enabled Cardswap Unwanted to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Cardswap Unwanted to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Cardswap Unwanted 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 CardSwap: Converting Unwanted Gift Cards into Cash - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Cardswap Unwanted is one of the leading recruiters in the industry. Managers in the CardSwap: Converting Unwanted Gift Cards into Cash are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Cardswap Unwanted 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.
Training and development
– Cardswap Unwanted has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CardSwap: Converting Unwanted Gift Cards into Cash 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.
Learning organization
- Cardswap Unwanted 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 Cardswap Unwanted is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CardSwap: Converting Unwanted Gift Cards into Cash Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Cardswap Unwanted 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 CardSwap: Converting Unwanted Gift Cards into Cash HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses CardSwap: Converting Unwanted Gift Cards into Cash | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CardSwap: Converting Unwanted Gift Cards into Cash are -
High operating costs
– Compare to the competitors, firm in the HBR case study CardSwap: Converting Unwanted Gift Cards into Cash 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 Cardswap Unwanted 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cardswap Unwanted is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study CardSwap: Converting Unwanted Gift Cards into Cash can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Cardswap Unwanted, firm in the HBR case study CardSwap: Converting Unwanted Gift Cards into Cash needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Cardswap Unwanted products
– To increase the profitability and margins on the products, Cardswap Unwanted needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the segment, Cardswap Unwanted 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.
High cash cycle compare to competitors
Cardswap Unwanted 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.
Interest costs
– Compare to the competition, Cardswap Unwanted 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 Cardswap Unwanted supply chain. Even after few cautionary changes mentioned in the HBR case study - CardSwap: Converting Unwanted Gift Cards into Cash, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cardswap Unwanted vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study CardSwap: Converting Unwanted Gift Cards into Cash 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 CardSwap: Converting Unwanted Gift Cards into Cash can leverage the sales team experience to cultivate customer relationships as Cardswap Unwanted is planning to shift buying processes online.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the CardSwap: Converting Unwanted Gift Cards into Cash HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Cardswap Unwanted has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CardSwap: Converting Unwanted Gift Cards into Cash, in the dynamic environment Cardswap Unwanted has struggled to respond to the nimble upstart competition. Cardswap Unwanted has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities CardSwap: Converting Unwanted Gift Cards into Cash | 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 CardSwap: Converting Unwanted Gift Cards into Cash are -
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 Cardswap Unwanted 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cardswap Unwanted 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 Cardswap Unwanted to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cardswap Unwanted 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.
Leveraging digital technologies
– Cardswap Unwanted 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.
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 Cardswap Unwanted in the consumer business. Now Cardswap Unwanted can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Cardswap Unwanted 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.
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. Cardswap Unwanted can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cardswap Unwanted can use these opportunities to build new business models that can help the communities that Cardswap Unwanted operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cardswap Unwanted 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, CardSwap: Converting Unwanted Gift Cards into Cash, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Cardswap Unwanted has opened avenues for new revenue streams for the organization in the industry. This can help Cardswap Unwanted to build a more holistic ecosystem as suggested in the CardSwap: Converting Unwanted Gift Cards into Cash case study. Cardswap Unwanted can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Cardswap Unwanted can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cardswap Unwanted is facing challenges because of the dominance of functional experts in the organization. CardSwap: Converting Unwanted Gift Cards into Cash 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cardswap Unwanted 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.
Threats CardSwap: Converting Unwanted Gift Cards into Cash External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CardSwap: Converting Unwanted Gift Cards into Cash are -
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 Cardswap Unwanted.
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 Cardswap Unwanted business can come under increasing regulations regarding data privacy, data security, etc.
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 Cardswap Unwanted in the Sales & Marketing sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cardswap Unwanted 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 wage structure of Cardswap Unwanted
– 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 Cardswap Unwanted.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CardSwap: Converting Unwanted Gift Cards into Cash, Cardswap Unwanted 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 .
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 Cardswap Unwanted with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Cardswap Unwanted 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.
Shortening product life cycle
– it is one of the major threat that Cardswap Unwanted is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cardswap Unwanted 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 CardSwap: Converting Unwanted Gift Cards into Cash .
Environmental challenges
– Cardswap Unwanted 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. Cardswap Unwanted can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
High dependence on third party suppliers
– Cardswap Unwanted 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.
Weighted SWOT Analysis of CardSwap: Converting Unwanted Gift Cards into Cash 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 CardSwap: Converting Unwanted Gift Cards into Cash 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 CardSwap: Converting Unwanted Gift Cards into Cash 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 CardSwap: Converting Unwanted Gift Cards into Cash 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 CardSwap: Converting Unwanted Gift Cards into Cash 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 Cardswap Unwanted needs to make to build a sustainable competitive advantage.