Hulu: Redefining the Way People Experience TV SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Hulu: Redefining the Way People Experience TV
In May 2017, Hulu CEO Mike Hopkins announced the launch of Hulu Live TV, a new offering that would "change the way people experience TV." The new service would allow consumers to bypass traditional cable and satellite delivery and use the Internet to access live streams of more than 40 popular broadcast and cable networks along with Hulu's existing suite of on-demand programming. Priced at $39.99 per month, Hulu Live TV offered consumers a tremendous savings over traditional cable program packages and allowed subscribers to watch programs on Internet-connected televisions and a wide range of mobile devices. Hopkins also announced that the company would make a major push into the production of exclusive, original programming, one of the industry's most competitive areas. Hulu's new initiatives occurred during a major transformation in the TV industry as the Internet had revolutionized every aspect of the business. Industry observers wondered if Hulu could successfully compete against the entrenched cable, satellite, and telephone companies (known as Multichannel Video Programming Distributors, or MVPDs). Was $39.99 per month a sustainable price point for Hulu's new virtual MVPD (vMVPD)? How big a war chest would the company need to succeed in the original programming arena where competitors annually spent billions of dollars? Could Hulu navigate potential conflicts with the individual business plans of its owners: Comcast, 21st Century Fox, Disney, and Warner Bros., some of the most powerful companies in the entertainment business?
Swot Analysis of "Hulu: Redefining the Way People Experience TV" written by Henry McGee, Christine Snively includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hulu Hulu's facing as an external strategic factors. Some of the topics covered in Hulu: Redefining the Way People Experience TV case study are - Strategic Management Strategies, Disruptive innovation, Internet, Pricing and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Hulu: Redefining the Way People Experience TV casestudy better are - – talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, central banks are concerned over increasing inflation,
there is increasing trade war between United States & China, wage bills are increasing, etc
Introduction to SWOT Analysis of Hulu: Redefining the Way People Experience TV
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hulu: Redefining the Way People Experience TV case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hulu Hulu's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hulu Hulu's 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 Hulu: Redefining the Way People Experience TV can be done for the following purposes –
1. Strategic planning using facts provided in Hulu: Redefining the Way People Experience TV case study
2. Improving business portfolio management of Hulu Hulu's
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hulu Hulu's
Strengths Hulu: Redefining the Way People Experience TV | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hulu Hulu's in Hulu: Redefining the Way People Experience TV Harvard Business Review case study are -
Training and development
– Hulu Hulu's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Hulu: Redefining the Way People Experience TV 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– Hulu: Redefining the Way People Experience TV firm has clearly differentiated products in the market place. This has enabled Hulu Hulu's to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Hulu Hulu's to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Hulu Hulu's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hulu Hulu's 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.
Organizational Resilience of Hulu Hulu's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hulu Hulu's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Hulu Hulu's has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Hulu: Redefining the Way People Experience TV - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Hulu Hulu's 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 Hulu Hulu's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Hulu: Redefining the Way People Experience TV Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Hulu Hulu's 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 Hulu Hulu's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Hulu Hulu's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hulu Hulu's has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to lead change in Leadership & Managing People field
– Hulu Hulu's 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 Hulu Hulu's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Hulu Hulu's 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.
Low bargaining power of suppliers
– Suppliers of Hulu Hulu's in the sector have low bargaining power. Hulu: Redefining the Way People Experience TV has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hulu Hulu's to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Hulu: Redefining the Way People Experience TV | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hulu: Redefining the Way People Experience TV are -
High cash cycle compare to competitors
Hulu Hulu's 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.
Slow to strategic competitive environment developments
– As Hulu: Redefining the Way People Experience TV HBR case study mentions - Hulu Hulu's 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, Hulu Hulu's 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.
Need for greater diversity
– Hulu Hulu's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hulu Hulu's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Hulu: Redefining the Way People Experience TV can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Hulu: Redefining the Way People Experience TV, it seems that the employees of Hulu Hulu's 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.
Lack of clear differentiation of Hulu Hulu's products
– To increase the profitability and margins on the products, Hulu Hulu's 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 Hulu Hulu's, firm in the HBR case study Hulu: Redefining the Way People Experience TV needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Hulu: Redefining the Way People Experience TV 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 Hulu Hulu's has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Hulu Hulu's is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Hulu Hulu's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hulu Hulu's to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Hulu Hulu's 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.
Opportunities Hulu: Redefining the Way People Experience TV | 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 Hulu: Redefining the Way People Experience TV are -
Developing new processes and practices
– Hulu Hulu's can develop new processes and procedures in Leadership & Managing People 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hulu Hulu's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hulu Hulu's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Hulu Hulu's to increase its market reach. Hulu Hulu's 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.
Learning at scale
– Online learning technologies has now opened space for Hulu Hulu's 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Hulu Hulu's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Hulu Hulu's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Hulu: Redefining the Way People Experience TV 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hulu Hulu's can use these opportunities to build new business models that can help the communities that Hulu Hulu's operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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 Hulu Hulu's in the consumer business. Now Hulu Hulu's can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Hulu Hulu's 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.
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 Hulu Hulu's 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hulu Hulu's is facing challenges because of the dominance of functional experts in the organization. Hulu: Redefining the Way People Experience TV 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.
Using analytics as competitive advantage
– Hulu Hulu's 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 Hulu: Redefining the Way People Experience TV - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hulu Hulu's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Hulu: Redefining the Way People Experience TV External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hulu: Redefining the Way People Experience TV 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 Hulu: Redefining the Way People Experience TV, Hulu Hulu's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hulu Hulu's in the Leadership & Managing People industry. The Leadership & Managing People 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.
Increasing wage structure of Hulu Hulu's
– 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 Hulu Hulu's.
Regulatory challenges
– Hulu Hulu's 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 Leadership & Managing People industry regulations.
High dependence on third party suppliers
– Hulu Hulu's 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.
Stagnating economy with rate increase
– Hulu Hulu's 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.
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.
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. Hulu Hulu's 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.
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 Hulu Hulu's business can come under increasing regulations regarding data privacy, data security, etc.
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 Hulu Hulu's.
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 Hulu Hulu's in the Leadership & Managing People sector and impact the bottomline of the organization.
Environmental challenges
– Hulu Hulu's 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. Hulu Hulu's can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hulu Hulu's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Hulu: Redefining the Way People Experience TV 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 Hulu: Redefining the Way People Experience TV 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 Hulu: Redefining the Way People Experience TV 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 Hulu: Redefining the Way People Experience TV 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 Hulu: Redefining the Way People Experience TV 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 Hulu Hulu's needs to make to build a sustainable competitive advantage.
