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 - – supply chains are disrupted by pandemic , technology disruption, increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, 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 -
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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Cardswap Unwanted digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cardswap Unwanted 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.
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.
Analytics focus
– Cardswap Unwanted 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 Neil Bendle, Michael Taylor 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.
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.
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.
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.
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.
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.
High brand equity
– Cardswap Unwanted has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cardswap Unwanted to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
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.
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.
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 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.
Need for greater diversity
– Cardswap Unwanted 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.
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.
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.
Increasing silos among functional specialists
– The organizational structure of Cardswap Unwanted is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Cardswap Unwanted needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cardswap Unwanted to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Cardswap Unwanted 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. Cardswap Unwanted 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.
Skills based hiring
– The stress on hiring functional specialists at Cardswap Unwanted 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.
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.
Slow to strategic competitive environment developments
– As CardSwap: Converting Unwanted Gift Cards into Cash HBR case study mentions - Cardswap Unwanted 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.
Capital Spending Reduction
– Even during the low interest decade, Cardswap Unwanted 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study CardSwap: Converting Unwanted Gift Cards into Cash, is just above the industry average. Cardswap Unwanted 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.
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 -
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.
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.
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.
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.
Buying journey improvements
– Cardswap Unwanted can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CardSwap: Converting Unwanted Gift Cards into Cash 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.
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.
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.
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.
Learning at scale
– Online learning technologies has now opened space for Cardswap Unwanted 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.
Manufacturing automation
– Cardswap Unwanted 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.
Loyalty marketing
– Cardswap Unwanted 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cardswap Unwanted can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Cardswap Unwanted can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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.
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 -
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. Cardswap Unwanted needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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 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.
Consumer confidence and its impact on Cardswap Unwanted 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.
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.
Regulatory challenges
– Cardswap Unwanted 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.
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. Cardswap Unwanted can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Technology acceleration in Forth Industrial Revolution
– Cardswap Unwanted has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Cardswap Unwanted 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.
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 .
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.
