Progressive Insurance: Making Pay As You Drive a Snap for Consumers SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Progressive Insurance: Making Pay As You Drive a Snap for Consumers
Heather Day, a marketing director and brand manager, must evaluate her options for Progressive Insurance's next Snapshot product advertising campaign. Working on a limited budget, Day must select between employing television ads featuring the popular character known as Flo and continuing with the launch of advertising campaigns already in use, such as "Rate Sucker." The case places Progressive's proposed advertising campaign into a broader historical context and asks how the Snapshot product both fits into the company's current business model and affects its channel strategy. Students are presented with a myriad of exhibits that help make this authentic marketing scenario come to life.
Authors :: Paul W. Farris, Sylvie Thompson, Thomas Steenburgh
Swot Analysis of "Progressive Insurance: Making Pay As You Drive a Snap for Consumers" written by Paul W. Farris, Sylvie Thompson, Thomas Steenburgh includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Snapshot Progressive facing as an external strategic factors. Some of the topics covered in Progressive Insurance: Making Pay As You Drive a Snap for Consumers case study are - Strategic Management Strategies, Pricing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Progressive Insurance: Making Pay As You Drive a Snap for Consumers casestudy better are - – supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of Progressive Insurance: Making Pay As You Drive a Snap for Consumers
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Progressive Insurance: Making Pay As You Drive a Snap for Consumers case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Snapshot Progressive, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Snapshot Progressive 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers can be done for the following purposes –
1. Strategic planning using facts provided in Progressive Insurance: Making Pay As You Drive a Snap for Consumers case study
2. Improving business portfolio management of Snapshot Progressive
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 Snapshot Progressive
Strengths Progressive Insurance: Making Pay As You Drive a Snap for Consumers | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Snapshot Progressive in Progressive Insurance: Making Pay As You Drive a Snap for Consumers Harvard Business Review case study are -
High brand equity
– Snapshot Progressive has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Snapshot Progressive to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Snapshot Progressive is present in almost all the verticals within the industry. This has provided firm in Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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.
High switching costs
– The high switching costs that Snapshot Progressive 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.
Operational resilience
– The operational resilience strategy in the Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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.
Strong track record of project management
– Snapshot Progressive is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Sales & Marketing industry
– Progressive Insurance: Making Pay As You Drive a Snap for Consumers firm has clearly differentiated products in the market place. This has enabled Snapshot Progressive to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Snapshot Progressive to invest into research and development (R&D) and innovation.
Analytics focus
– Snapshot Progressive 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 Paul W. Farris, Sylvie Thompson, Thomas Steenburgh 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.
Ability to lead change in Sales & Marketing field
– Snapshot Progressive 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 Snapshot Progressive 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 Snapshot Progressive in the sector have low bargaining power. Progressive Insurance: Making Pay As You Drive a Snap for Consumers has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Snapshot Progressive to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Snapshot Progressive 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 Snapshot Progressive is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Progressive Insurance: Making Pay As You Drive a Snap for Consumers Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Snapshot Progressive is one of the leading recruiters in the industry. Managers in the Progressive Insurance: Making Pay As You Drive a Snap for Consumers are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Snapshot Progressive 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Progressive Insurance: Making Pay As You Drive a Snap for Consumers | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Progressive Insurance: Making Pay As You Drive a Snap for Consumers are -
Low market penetration in new markets
– Outside its home market of Snapshot Progressive, firm in the HBR case study Progressive Insurance: Making Pay As You Drive a Snap for Consumers needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Snapshot Progressive 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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 Snapshot Progressive 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Snapshot Progressive is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Snapshot Progressive needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Snapshot Progressive to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Progressive Insurance: Making Pay As You Drive a Snap for Consumers HBR case study mentions - Snapshot Progressive 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Progressive Insurance: Making Pay As You Drive a Snap for Consumers, is just above the industry average. Snapshot Progressive 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.
Interest costs
– Compare to the competition, Snapshot Progressive 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Snapshot Progressive 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 Snapshot Progressive 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.
Lack of clear differentiation of Snapshot Progressive products
– To increase the profitability and margins on the products, Snapshot Progressive needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Snapshot Progressive has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Progressive Insurance: Making Pay As You Drive a Snap for Consumers should strive to include more intangible value offerings along with its core products and services.
Opportunities Progressive Insurance: Making Pay As You Drive a Snap for Consumers | 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Snapshot Progressive is facing challenges because of the dominance of functional experts in the organization. Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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.
Leveraging digital technologies
– Snapshot Progressive 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.
Developing new processes and practices
– Snapshot Progressive 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Snapshot Progressive 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 Snapshot Progressive to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Snapshot Progressive 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.
Better consumer reach
– The expansion of the 5G network will help Snapshot Progressive to increase its market reach. Snapshot Progressive 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.
Loyalty marketing
– Snapshot Progressive 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.
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. Snapshot Progressive 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, Snapshot Progressive can use these opportunities to build new business models that can help the communities that Snapshot Progressive operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
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 Snapshot Progressive 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.
Learning at scale
– Online learning technologies has now opened space for Snapshot Progressive 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.
Creating value in data economy
– The success of analytics program of Snapshot Progressive has opened avenues for new revenue streams for the organization in the industry. This can help Snapshot Progressive to build a more holistic ecosystem as suggested in the Progressive Insurance: Making Pay As You Drive a Snap for Consumers case study. Snapshot Progressive can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Snapshot Progressive 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, Progressive Insurance: Making Pay As You Drive a Snap for Consumers, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Progressive Insurance: Making Pay As You Drive a Snap for Consumers External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Progressive Insurance: Making Pay As You Drive a Snap for Consumers are -
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.
Technology acceleration in Forth Industrial Revolution
– Snapshot Progressive has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Snapshot Progressive 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.
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 Snapshot Progressive.
Consumer confidence and its impact on Snapshot Progressive 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.
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.
Stagnating economy with rate increase
– Snapshot Progressive 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.
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. Snapshot Progressive can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Snapshot Progressive business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Snapshot Progressive is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Snapshot Progressive with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Snapshot Progressive 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. Snapshot Progressive can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Increasing wage structure of Snapshot Progressive
– 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 Snapshot Progressive.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Snapshot Progressive 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.
Weighted SWOT Analysis of Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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 Progressive Insurance: Making Pay As You Drive a Snap for Consumers 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 Snapshot Progressive needs to make to build a sustainable competitive advantage.