Case Study Description of Chase Sapphire: Creating a Millennial Cult Brand
The launch of the Chase Sapphire Reserve credit card was enthusiastically received by Millennial consumers, a cohort that had previously eluded JPMorgan Chase and its competitors. With the one year anniversary of the launch approaching, managers are focused on retaining customers attracted by a one-time signup bonus of 100,000 reward points and on acquiring new customers now that the bonus had been reduced to 50,000 points. They were also refocusing on the remainder of the Chase Sapphire product porfolio to assess differentiation among the products and to identify white space in the market that could support additional new product launches.
Swot Analysis of "Chase Sapphire: Creating a Millennial Cult Brand" written by Shelle Santana, Jill Avery, Christine Snively includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chase Sapphire facing as an external strategic factors. Some of the topics covered in Chase Sapphire: Creating a Millennial Cult Brand case study are - Strategic Management Strategies, Customers, Generational issues, Product development, Sales, Supply chain and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Chase Sapphire: Creating a Millennial Cult Brand casestudy better are - – there is backlash against globalization, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, geopolitical disruptions, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion,
there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Chase Sapphire: Creating a Millennial Cult Brand
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Chase Sapphire: Creating a Millennial Cult Brand case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chase Sapphire, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chase Sapphire 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 Chase Sapphire: Creating a Millennial Cult Brand can be done for the following purposes –
1. Strategic planning using facts provided in Chase Sapphire: Creating a Millennial Cult Brand case study
2. Improving business portfolio management of Chase Sapphire
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 Chase Sapphire
Strengths Chase Sapphire: Creating a Millennial Cult Brand | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chase Sapphire in Chase Sapphire: Creating a Millennial Cult Brand Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Chase Sapphire 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.
Ability to recruit top talent
– Chase Sapphire is one of the leading recruiters in the industry. Managers in the Chase Sapphire: Creating a Millennial Cult Brand are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Chase Sapphire has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Chase Sapphire: Creating a Millennial Cult Brand 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.
Diverse revenue streams
– Chase Sapphire is present in almost all the verticals within the industry. This has provided firm in Chase Sapphire: Creating a Millennial Cult Brand 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.
Low bargaining power of suppliers
– Suppliers of Chase Sapphire in the sector have low bargaining power. Chase Sapphire: Creating a Millennial Cult Brand has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chase Sapphire to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Chase Sapphire 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 Chase Sapphire in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Chase Sapphire 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 Chase Sapphire is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Chase Sapphire: Creating a Millennial Cult Brand Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Chase Sapphire is one of the most innovative firm in sector. Manager in Chase Sapphire: Creating a Millennial Cult Brand Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Chase Sapphire 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 Chase Sapphire: Creating a Millennial Cult Brand HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Chase Sapphire
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chase Sapphire does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Chase Sapphire 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.
Weaknesses Chase Sapphire: Creating a Millennial Cult Brand | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chase Sapphire: Creating a Millennial Cult Brand are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chase Sapphire is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Chase Sapphire: Creating a Millennial Cult Brand can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Chase Sapphire, firm in the HBR case study Chase Sapphire: Creating a Millennial Cult Brand needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Chase Sapphire 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 - Chase Sapphire: Creating a Millennial Cult Brand should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Chase Sapphire 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.
No frontier risks strategy
– After analyzing the HBR case study Chase Sapphire: Creating a Millennial Cult Brand, it seems that company is thinking about the frontier risks that can impact Sales & Marketing 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Chase Sapphire: Creating a Millennial Cult Brand, is just above the industry average. Chase Sapphire 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.
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 Chase Sapphire supply chain. Even after few cautionary changes mentioned in the HBR case study - Chase Sapphire: Creating a Millennial Cult Brand, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Chase Sapphire vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Chase Sapphire is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Chase Sapphire needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chase Sapphire to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Chase Sapphire has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Chase Sapphire even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Aligning sales with marketing
– It come across in the case study Chase Sapphire: Creating a Millennial Cult Brand 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 Chase Sapphire: Creating a Millennial Cult Brand can leverage the sales team experience to cultivate customer relationships as Chase Sapphire is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Chase Sapphire: Creating a Millennial Cult Brand HBR case study mentions - Chase Sapphire 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.
Opportunities Chase Sapphire: Creating a Millennial Cult Brand | 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 Chase Sapphire: Creating a Millennial Cult Brand are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chase Sapphire 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 Chase Sapphire to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Chase Sapphire is facing challenges because of the dominance of functional experts in the organization. Chase Sapphire: Creating a Millennial Cult Brand 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Chase Sapphire 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, Chase Sapphire: Creating a Millennial Cult Brand, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Chase Sapphire 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.
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 Chase Sapphire in the consumer business. Now Chase Sapphire can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Chase Sapphire can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Loyalty marketing
– Chase Sapphire 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.
Developing new processes and practices
– Chase Sapphire 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chase Sapphire 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.
Leveraging digital technologies
– Chase Sapphire 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.
Better consumer reach
– The expansion of the 5G network will help Chase Sapphire to increase its market reach. Chase Sapphire 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.
Using analytics as competitive advantage
– Chase Sapphire 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 Chase Sapphire: Creating a Millennial Cult Brand - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Chase Sapphire to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Chase Sapphire 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.
Threats Chase Sapphire: Creating a Millennial Cult Brand External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Chase Sapphire: Creating a Millennial Cult Brand are -
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 Chase Sapphire in the Sales & Marketing sector and impact the bottomline of the organization.
Increasing wage structure of Chase Sapphire
– 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 Chase Sapphire.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Chase Sapphire: Creating a Millennial Cult Brand, Chase Sapphire may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
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. Chase Sapphire can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Chase Sapphire is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Chase Sapphire high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Chase Sapphire business can come under increasing regulations regarding data privacy, data security, etc.
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.
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. Chase Sapphire 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.
Stagnating economy with rate increase
– Chase Sapphire 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Chase Sapphire can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Chase Sapphire: Creating a Millennial Cult Brand .
Consumer confidence and its impact on Chase Sapphire 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.
Weighted SWOT Analysis of Chase Sapphire: Creating a Millennial Cult Brand 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 Chase Sapphire: Creating a Millennial Cult Brand 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 Chase Sapphire: Creating a Millennial Cult Brand 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 Chase Sapphire: Creating a Millennial Cult Brand 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 Chase Sapphire: Creating a Millennial Cult Brand 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 Chase Sapphire needs to make to build a sustainable competitive advantage.