Case Study Description of MedNet.com Confronts 'Click-Through' Competition
When students have the English-language PDF of this Brief Case in a coursepack, they will also have the option to purchase an audio version.In January 2007, "MedNet.com" is a leading website that provides science-based health information free of charge to online visitors. MedNet communicates with traditional web journalism, interactive software, and social media tools such as blogs, video reports and virtual reality tours. The site operates conservatively within the government-regulated health information market. MedNet's business model relies on advertising sales, primarily to pharmaceutical companies. MedNet competes for advertising dollars with large search engines, category specific sites, and clinical trial sites. In 2007, large search engines charge for "results," or "click throughs." Other sites, such as online newspapers, charge for impressions. Advertising campaigns depend on numerous variables (an efficient audience size, audience frame of mind, willingness to complete a transaction, etc.) In the face of fierce advertising competition, MedNet is forced to defend key elements of its business model vis-a-vis a large search engine. However, in defending the advertising value MedNet delivers, MedNet executives may be building the case for why niche sites may be a better investment for the advertiser's budget.
Swot Analysis of "MedNet.com Confronts 'Click-Through' Competition" written by Allegra Young includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mednet Sites facing as an external strategic factors. Some of the topics covered in MedNet.com Confronts 'Click-Through' Competition case study are - Strategic Management Strategies, Financial management, Internet, Marketing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the MedNet.com Confronts 'Click-Through' Competition casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, technology disruption, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs,
wage bills are increasing, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of MedNet.com Confronts 'Click-Through' Competition
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MedNet.com Confronts 'Click-Through' Competition case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mednet Sites, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mednet Sites 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 MedNet.com Confronts 'Click-Through' Competition can be done for the following purposes –
1. Strategic planning using facts provided in MedNet.com Confronts 'Click-Through' Competition case study
2. Improving business portfolio management of Mednet Sites
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mednet Sites
Strengths MedNet.com Confronts 'Click-Through' Competition | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mednet Sites in MedNet.com Confronts 'Click-Through' Competition Harvard Business Review case study are -
High switching costs
– The high switching costs that Mednet Sites has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Strong track record of project management
– Mednet Sites is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Mednet Sites in the sector have low bargaining power. MedNet.com Confronts 'Click-Through' Competition has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mednet Sites to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Strategy & Execution field
– Mednet Sites 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 Mednet Sites in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Mednet Sites 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 Allegra Young 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.
Innovation driven organization
– Mednet Sites is one of the most innovative firm in sector. Manager in MedNet.com Confronts 'Click-Through' Competition Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the MedNet.com Confronts 'Click-Through' Competition 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.
Diverse revenue streams
– Mednet Sites is present in almost all the verticals within the industry. This has provided firm in MedNet.com Confronts 'Click-Through' Competition 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.
Ability to recruit top talent
– Mednet Sites is one of the leading recruiters in the industry. Managers in the MedNet.com Confronts 'Click-Through' Competition are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Strategy & Execution industry
– MedNet.com Confronts 'Click-Through' Competition firm has clearly differentiated products in the market place. This has enabled Mednet Sites to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Mednet Sites to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Mednet Sites 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 MedNet.com Confronts 'Click-Through' Competition HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Mednet Sites in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses MedNet.com Confronts 'Click-Through' Competition | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MedNet.com Confronts 'Click-Through' Competition are -
Aligning sales with marketing
– It come across in the case study MedNet.com Confronts 'Click-Through' Competition 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 MedNet.com Confronts 'Click-Through' Competition can leverage the sales team experience to cultivate customer relationships as Mednet Sites is planning to shift buying processes online.
High cash cycle compare to competitors
Mednet Sites 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the MedNet.com Confronts 'Click-Through' Competition 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 Mednet Sites has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study MedNet.com Confronts 'Click-Through' Competition, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Need for greater diversity
– Mednet Sites 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.
Increasing silos among functional specialists
– The organizational structure of Mednet Sites is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Mednet Sites needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mednet Sites to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As MedNet.com Confronts 'Click-Through' Competition HBR case study mentions - Mednet Sites 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, Mednet Sites 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.
Interest costs
– Compare to the competition, Mednet Sites 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.
Products dominated business model
– Even though Mednet Sites 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 - MedNet.com Confronts 'Click-Through' Competition should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study MedNet.com Confronts 'Click-Through' Competition, is just above the industry average. Mednet Sites 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 MedNet.com Confronts 'Click-Through' Competition | 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 MedNet.com Confronts 'Click-Through' Competition are -
Better consumer reach
– The expansion of the 5G network will help Mednet Sites to increase its market reach. Mednet Sites 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mednet Sites can use these opportunities to build new business models that can help the communities that Mednet Sites operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Learning at scale
– Online learning technologies has now opened space for Mednet Sites to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mednet Sites 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 Mednet Sites to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Mednet Sites has opened avenues for new revenue streams for the organization in the industry. This can help Mednet Sites to build a more holistic ecosystem as suggested in the MedNet.com Confronts 'Click-Through' Competition case study. Mednet Sites can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Mednet Sites in the consumer business. Now Mednet Sites can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mednet Sites 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. Mednet Sites 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mednet Sites 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.
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. Mednet Sites can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mednet Sites in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Mednet Sites 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 Strategy & Execution segment.
Buying journey improvements
– Mednet Sites can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. MedNet.com Confronts 'Click-Through' Competition 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.
Loyalty marketing
– Mednet Sites 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.
Threats MedNet.com Confronts 'Click-Through' Competition External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MedNet.com Confronts 'Click-Through' Competition are -
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 Mednet Sites business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mednet Sites in the Strategy & Execution industry. The Strategy & Execution 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.
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. Mednet Sites 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.
Shortening product life cycle
– it is one of the major threat that Mednet Sites is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 Mednet Sites in the Strategy & Execution sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Mednet Sites with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Mednet Sites 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. Mednet Sites can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Regulatory challenges
– Mednet Sites 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 Strategy & Execution industry regulations.
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. Mednet Sites needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Mednet Sites
– 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 Mednet Sites.
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
– Mednet Sites 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.
Weighted SWOT Analysis of MedNet.com Confronts 'Click-Through' Competition 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 MedNet.com Confronts 'Click-Through' Competition 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 MedNet.com Confronts 'Click-Through' Competition 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 MedNet.com Confronts 'Click-Through' Competition 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 MedNet.com Confronts 'Click-Through' Competition 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 Mednet Sites needs to make to build a sustainable competitive advantage.