Blockbuster Entertainment Corp.: Growth Strategies for 1995 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Blockbuster Entertainment Corp.: Growth Strategies for 1995
Despite its clear leadership position, Blockbuster was running out of places in which to open new stores. As the growth and profitability of its traditional video rental business slowed, James Hilmer, chief marketing officer, evaluated two growth opportunities: set up virtual reality parlors within existing video stores, the test marketing of which had shown positive results; or leverage its retailing skills by diversifying into specialty retailing of merchandise from entertainment properties of its partners Viacom and Paramount. In this effort to grow by brand extension, Hilmer analyzes which option lets Blockbuster leverage its existing brand the most. How do the two market segments compare in terms of size, existing and future competition, investment requirements and returns, and Blockbuster's ability to grow and defend itself in the segment?
Swot Analysis of "Blockbuster Entertainment Corp.: Growth Strategies for 1995" written by Mohanbir Sawhney includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hilmer Blockbuster facing as an external strategic factors. Some of the topics covered in Blockbuster Entertainment Corp.: Growth Strategies for 1995 case study are - Strategic Management Strategies, Growth strategy, Market research, Risk management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Blockbuster Entertainment Corp.: Growth Strategies for 1995 casestudy better are - – technology disruption, increasing transportation and logistics costs, cloud computing is disrupting traditional business models, 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, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google,
increasing household debt because of falling income levels, geopolitical disruptions, etc
Introduction to SWOT Analysis of Blockbuster Entertainment Corp.: Growth Strategies for 1995
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Blockbuster Entertainment Corp.: Growth Strategies for 1995 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hilmer Blockbuster, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hilmer Blockbuster 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 can be done for the following purposes –
1. Strategic planning using facts provided in Blockbuster Entertainment Corp.: Growth Strategies for 1995 case study
2. Improving business portfolio management of Hilmer Blockbuster
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 Hilmer Blockbuster
Strengths Blockbuster Entertainment Corp.: Growth Strategies for 1995 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hilmer Blockbuster in Blockbuster Entertainment Corp.: Growth Strategies for 1995 Harvard Business Review case study are -
Strong track record of project management
– Hilmer Blockbuster is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Hilmer Blockbuster in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Hilmer Blockbuster
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hilmer Blockbuster does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Hilmer Blockbuster is one of the leading recruiters in the industry. Managers in the Blockbuster Entertainment Corp.: Growth Strategies for 1995 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Hilmer Blockbuster is present in almost all the verticals within the industry. This has provided firm in Blockbuster Entertainment Corp.: Growth Strategies for 1995 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.
Highly skilled collaborators
– Hilmer Blockbuster 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Hilmer Blockbuster has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hilmer Blockbuster 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.
High switching costs
– The high switching costs that Hilmer Blockbuster 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.
Training and development
– Hilmer Blockbuster has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Blockbuster Entertainment Corp.: Growth Strategies for 1995 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.
Operational resilience
– The operational resilience strategy in the Blockbuster Entertainment Corp.: Growth Strategies for 1995 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.
Analytics focus
– Hilmer Blockbuster 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 Mohanbir Sawhney 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Blockbuster Entertainment Corp.: Growth Strategies for 1995 firm has clearly differentiated products in the market place. This has enabled Hilmer Blockbuster to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Hilmer Blockbuster to invest into research and development (R&D) and innovation.
Weaknesses Blockbuster Entertainment Corp.: Growth Strategies for 1995 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Blockbuster Entertainment Corp.: Growth Strategies for 1995 are -
Products dominated business model
– Even though Hilmer Blockbuster 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 - Blockbuster Entertainment Corp.: Growth Strategies for 1995 should strive to include more intangible value offerings along with its core products and services.
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 Hilmer Blockbuster supply chain. Even after few cautionary changes mentioned in the HBR case study - Blockbuster Entertainment Corp.: Growth Strategies for 1995, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hilmer Blockbuster vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study Blockbuster Entertainment Corp.: Growth Strategies for 1995, 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.
Lack of clear differentiation of Hilmer Blockbuster products
– To increase the profitability and margins on the products, Hilmer Blockbuster needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Blockbuster Entertainment Corp.: Growth Strategies for 1995 HBR case study mentions - Hilmer Blockbuster 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.
Aligning sales with marketing
– It come across in the case study Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 can leverage the sales team experience to cultivate customer relationships as Hilmer Blockbuster is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hilmer Blockbuster is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Blockbuster Entertainment Corp.: Growth Strategies for 1995 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Hilmer Blockbuster is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Hilmer Blockbuster needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hilmer Blockbuster to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Hilmer Blockbuster has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Hilmer Blockbuster 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.
Capital Spending Reduction
– Even during the low interest decade, Hilmer Blockbuster 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.
Opportunities Blockbuster Entertainment Corp.: Growth Strategies for 1995 | 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 are -
Learning at scale
– Online learning technologies has now opened space for Hilmer Blockbuster 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.
Using analytics as competitive advantage
– Hilmer Blockbuster 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hilmer Blockbuster to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Hilmer Blockbuster can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Hilmer Blockbuster can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Blockbuster Entertainment Corp.: Growth Strategies for 1995 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.
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. Hilmer Blockbuster 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. Hilmer Blockbuster 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Hilmer Blockbuster can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Hilmer Blockbuster to increase its market reach. Hilmer Blockbuster 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.
Building a culture of innovation
– managers at Hilmer Blockbuster 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.
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 Hilmer Blockbuster 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.
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 Hilmer Blockbuster in the consumer business. Now Hilmer Blockbuster can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hilmer Blockbuster 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 Hilmer Blockbuster to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hilmer Blockbuster can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Hilmer Blockbuster has opened avenues for new revenue streams for the organization in the industry. This can help Hilmer Blockbuster to build a more holistic ecosystem as suggested in the Blockbuster Entertainment Corp.: Growth Strategies for 1995 case study. Hilmer Blockbuster can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Blockbuster Entertainment Corp.: Growth Strategies for 1995 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Blockbuster Entertainment Corp.: Growth Strategies for 1995 are -
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. Hilmer Blockbuster 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.
Regulatory challenges
– Hilmer Blockbuster 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 dependence on third party suppliers
– Hilmer Blockbuster 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hilmer Blockbuster 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.
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 Hilmer Blockbuster business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Hilmer Blockbuster
– 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 Hilmer Blockbuster.
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 Hilmer Blockbuster in the Strategy & Execution sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Hilmer Blockbuster has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Hilmer Blockbuster needs to keep up with the evolution of technology in the Strategy & Execution 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 Hilmer Blockbuster.
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 Hilmer Blockbuster is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hilmer Blockbuster can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Hilmer Blockbuster 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Blockbuster Entertainment Corp.: Growth Strategies for 1995 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 Hilmer Blockbuster needs to make to build a sustainable competitive advantage.
