Case Study Description of Paper Boat Beverage: Branding Delightful Nostalgia
Hector Beverages reinvented the ethnic drinks category in the Indian market with its beverage brand Paper Boat. The brand had been successful since its launch in 2013, posting triple-digit growth in 2015. By the end of December 2015, Hector Beverages' future seemed to be heavily dependent upon Paper Boat. With Paper Boat constituting 90 per cent of the company's total sales, 2016 would be a critical year for Hector Beverages. Should the company add more variety to its line of products, or should it focus on a few best-selling variants? Would the Paper Boat brand remain strong despite the launch of a similar product by a major competitor? Could Hector Beverages maintain its hold on the Indian ethnic drinks market? Saju B. is affiliated with VIT University. Hari Krishnan K. is affiliated with VIT University. Joseph Jeya Anand S. is affiliated with VIT University.
Authors :: Saju B, Harikrishnan K, Joseph Jeya Anand S
Swot Analysis of "Paper Boat Beverage: Branding Delightful Nostalgia" written by Saju B, Harikrishnan K, Joseph Jeya Anand S includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Boat Hector facing as an external strategic factors. Some of the topics covered in Paper Boat Beverage: Branding Delightful Nostalgia case study are - Strategic Management Strategies, Entrepreneurship, Product development and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Paper Boat Beverage: Branding Delightful Nostalgia casestudy better are - – supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing commodity prices, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, central banks are concerned over increasing inflation,
challanges to central banks by blockchain based private currencies, technology disruption, etc
Introduction to SWOT Analysis of Paper Boat Beverage: Branding Delightful Nostalgia
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Paper Boat Beverage: Branding Delightful Nostalgia case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Boat Hector, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Boat Hector 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 Paper Boat Beverage: Branding Delightful Nostalgia can be done for the following purposes –
1. Strategic planning using facts provided in Paper Boat Beverage: Branding Delightful Nostalgia case study
2. Improving business portfolio management of Boat Hector
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 Boat Hector
Strengths Paper Boat Beverage: Branding Delightful Nostalgia | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Boat Hector in Paper Boat Beverage: Branding Delightful Nostalgia Harvard Business Review case study are -
Ability to recruit top talent
– Boat Hector is one of the leading recruiters in the industry. Managers in the Paper Boat Beverage: Branding Delightful Nostalgia are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Boat Hector has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Boat Hector 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.
Learning organization
- Boat Hector 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 Boat Hector is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Paper Boat Beverage: Branding Delightful Nostalgia Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Boat Hector 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 Saju B, Harikrishnan K, Joseph Jeya Anand S 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.
Operational resilience
– The operational resilience strategy in the Paper Boat Beverage: Branding Delightful Nostalgia 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.
Sustainable margins compare to other players in Sales & Marketing industry
– Paper Boat Beverage: Branding Delightful Nostalgia firm has clearly differentiated products in the market place. This has enabled Boat Hector to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Boat Hector to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Boat Hector 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 Boat Hector in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Boat Hector 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.
Diverse revenue streams
– Boat Hector is present in almost all the verticals within the industry. This has provided firm in Paper Boat Beverage: Branding Delightful Nostalgia 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.
Organizational Resilience of Boat Hector
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Boat Hector does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Boat Hector has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Boat Hector to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Paper Boat Beverage: Branding Delightful Nostalgia | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Paper Boat Beverage: Branding Delightful Nostalgia are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Paper Boat Beverage: Branding Delightful Nostalgia, it seems that the employees of Boat Hector don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High operating costs
– Compare to the competitors, firm in the HBR case study Paper Boat Beverage: Branding Delightful Nostalgia 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 Boat Hector 's lucrative customers.
Interest costs
– Compare to the competition, Boat Hector 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.
Increasing silos among functional specialists
– The organizational structure of Boat Hector is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Boat Hector needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Boat Hector to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Boat Hector 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. Boat Hector 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.
Need for greater diversity
– Boat Hector 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Paper Boat Beverage: Branding Delightful Nostalgia, in the dynamic environment Boat Hector has struggled to respond to the nimble upstart competition. Boat Hector has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Boat Hector products
– To increase the profitability and margins on the products, Boat Hector 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 Boat Hector, firm in the HBR case study Paper Boat Beverage: Branding Delightful Nostalgia needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Boat Hector supply chain. Even after few cautionary changes mentioned in the HBR case study - Paper Boat Beverage: Branding Delightful Nostalgia, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Boat Hector vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Paper Boat Beverage: Branding Delightful Nostalgia 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 Paper Boat Beverage: Branding Delightful Nostalgia can leverage the sales team experience to cultivate customer relationships as Boat Hector is planning to shift buying processes online.
Opportunities Paper Boat Beverage: Branding Delightful Nostalgia | 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 Paper Boat Beverage: Branding Delightful Nostalgia are -
Developing new processes and practices
– Boat Hector 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.
Using analytics as competitive advantage
– Boat Hector 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 Paper Boat Beverage: Branding Delightful Nostalgia - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Boat Hector to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Boat Hector can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Boat Hector can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Boat Hector 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Boat Hector 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, Paper Boat Beverage: Branding Delightful Nostalgia, 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 Boat Hector 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.
Manufacturing automation
– Boat Hector 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Boat Hector 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 Boat Hector to hire the very best people irrespective of their geographical location.
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. Boat Hector 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. Boat Hector 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.
Better consumer reach
– The expansion of the 5G network will help Boat Hector to increase its market reach. Boat Hector 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.
Buying journey improvements
– Boat Hector can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Paper Boat Beverage: Branding Delightful Nostalgia 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.
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 Boat Hector in the consumer business. Now Boat Hector can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Paper Boat Beverage: Branding Delightful Nostalgia External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Paper Boat Beverage: Branding Delightful Nostalgia are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Paper Boat Beverage: Branding Delightful Nostalgia, Boat Hector 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 .
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. Boat Hector 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 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.
Regulatory challenges
– Boat Hector 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.
High dependence on third party suppliers
– Boat Hector 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.
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 Boat Hector business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Boat Hector is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Environmental challenges
– Boat Hector 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. Boat Hector can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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 Boat Hector in the Sales & Marketing sector and impact the bottomline of the organization.
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. Boat Hector needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Boat Hector 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 Paper Boat Beverage: Branding Delightful Nostalgia .
Technology acceleration in Forth Industrial Revolution
– Boat Hector has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Boat Hector 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.
Weighted SWOT Analysis of Paper Boat Beverage: Branding Delightful Nostalgia 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 Paper Boat Beverage: Branding Delightful Nostalgia 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 Paper Boat Beverage: Branding Delightful Nostalgia 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 Paper Boat Beverage: Branding Delightful Nostalgia 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 Paper Boat Beverage: Branding Delightful Nostalgia 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 Boat Hector needs to make to build a sustainable competitive advantage.
