TATCHA: Marketing the Beauty Secrets of Japanese Geisha SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of TATCHA: Marketing the Beauty Secrets of Japanese Geisha
Case considers the creation and early growth of California-based TATCHA, a Japanese-themed luxury beauty brand. It explores how Vicky Tsai developed the concept, assembled financial and management resources,and launched the first product of Japanese blotting paper in 2009 using a grassroots marketing campaign. Identifying a 200-year old book employed by Japanese geisha, Tsai started to diversify her product line into skin and other cosmetic products. The case ends in December 2010 with Tsai receiving an acquisition offer, and debating the merits of exiting or continuing to build her business.
Swot Analysis of "TATCHA: Marketing the Beauty Secrets of Japanese Geisha" written by Geoffrey G. Jones, Veronica Tong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tsai Geisha facing as an external strategic factors. Some of the topics covered in TATCHA: Marketing the Beauty Secrets of Japanese Geisha case study are - Strategic Management Strategies, Marketing and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the TATCHA: Marketing the Beauty Secrets of Japanese Geisha casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%,
increasing commodity prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of TATCHA: Marketing the Beauty Secrets of Japanese Geisha
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in TATCHA: Marketing the Beauty Secrets of Japanese Geisha case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tsai Geisha, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tsai Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha can be done for the following purposes –
1. Strategic planning using facts provided in TATCHA: Marketing the Beauty Secrets of Japanese Geisha case study
2. Improving business portfolio management of Tsai Geisha
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tsai Geisha
Strengths TATCHA: Marketing the Beauty Secrets of Japanese Geisha | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tsai Geisha in TATCHA: Marketing the Beauty Secrets of Japanese Geisha Harvard Business Review case study are -
Strong track record of project management
– Tsai Geisha is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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.
Ability to lead change in Innovation & Entrepreneurship field
– Tsai Geisha 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 Tsai Geisha in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Tsai Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Tsai Geisha is one of the leading recruiters in the industry. Managers in the TATCHA: Marketing the Beauty Secrets of Japanese Geisha are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Tsai Geisha digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tsai Geisha 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.
Successful track record of launching new products
– Tsai Geisha has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Tsai Geisha 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 Tsai Geisha
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Tsai Geisha does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Tsai Geisha in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Tsai Geisha in the sector have low bargaining power. TATCHA: Marketing the Beauty Secrets of Japanese Geisha has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tsai Geisha to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Tsai Geisha is one of the most innovative firm in sector. Manager in TATCHA: Marketing the Beauty Secrets of Japanese Geisha Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Tsai Geisha is present in almost all the verticals within the industry. This has provided firm in TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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.
Weaknesses TATCHA: Marketing the Beauty Secrets of Japanese Geisha | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TATCHA: Marketing the Beauty Secrets of Japanese Geisha are -
Interest costs
– Compare to the competition, Tsai Geisha 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.
Low market penetration in new markets
– Outside its home market of Tsai Geisha, firm in the HBR case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tsai Geisha is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Tsai Geisha products
– To increase the profitability and margins on the products, Tsai Geisha needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Tsai Geisha 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Tsai Geisha needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
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 Tsai Geisha supply chain. Even after few cautionary changes mentioned in the HBR case study - TATCHA: Marketing the Beauty Secrets of Japanese Geisha, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tsai Geisha vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Tsai Geisha 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.
High operating costs
– Compare to the competitors, firm in the HBR case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Tsai Geisha 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Tsai Geisha 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha, is just above the industry average. Tsai Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha | 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tsai Geisha can use these opportunities to build new business models that can help the communities that Tsai Geisha operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Better consumer reach
– The expansion of the 5G network will help Tsai Geisha to increase its market reach. Tsai Geisha 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Tsai Geisha 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tsai Geisha 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 Tsai Geisha to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Tsai Geisha 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tsai Geisha in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Tsai Geisha 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.
Buying journey improvements
– Tsai Geisha can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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.
Creating value in data economy
– The success of analytics program of Tsai Geisha has opened avenues for new revenue streams for the organization in the industry. This can help Tsai Geisha to build a more holistic ecosystem as suggested in the TATCHA: Marketing the Beauty Secrets of Japanese Geisha case study. Tsai Geisha can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Tsai Geisha 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. Tsai Geisha 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.
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 Tsai Geisha 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.
Building a culture of innovation
– managers at Tsai Geisha 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 Innovation & Entrepreneurship segment.
Using analytics as competitive advantage
– Tsai Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tsai Geisha to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats TATCHA: Marketing the Beauty Secrets of Japanese Geisha External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha are -
Stagnating economy with rate increase
– Tsai Geisha 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Tsai Geisha in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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 Tsai Geisha
– 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 Tsai Geisha.
Technology acceleration in Forth Industrial Revolution
– Tsai Geisha has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Tsai Geisha needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
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 Tsai Geisha business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tsai Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha .
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. Tsai Geisha 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.
Environmental challenges
– Tsai Geisha 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. Tsai Geisha can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Shortening product life cycle
– it is one of the major threat that Tsai Geisha is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Regulatory challenges
– Tsai Geisha 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 Innovation & Entrepreneurship industry regulations.
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.
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 Tsai Geisha in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Weighted SWOT Analysis of TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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 Tsai Geisha needs to make to build a sustainable competitive advantage.