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 - – increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing,
increasing transportation and logistics costs, central banks are concerned over increasing inflation, 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 -
High switching costs
– The high switching costs that Tsai Geisha 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– TATCHA: Marketing the Beauty Secrets of Japanese Geisha firm has clearly differentiated products in the market place. This has enabled Tsai Geisha to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Tsai Geisha to invest into research and development (R&D) and innovation.
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.
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.
Training and development
– Tsai Geisha has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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.
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.
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.
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.
Learning organization
- Tsai Geisha 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 Tsai Geisha is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in TATCHA: Marketing the Beauty Secrets of Japanese Geisha Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Tsai Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
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.
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 -
No frontier risks strategy
– After analyzing the HBR case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
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.
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.
High bargaining power of channel partners
– Because of the regulatory requirements, Geoffrey G. Jones, Veronica Tong suggests that, Tsai Geisha is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
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.
Products dominated business model
– Even though Tsai Geisha 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 - TATCHA: Marketing the Beauty Secrets of Japanese Geisha should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Tsai Geisha is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Tsai Geisha needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tsai Geisha to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha 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 TATCHA: Marketing the Beauty Secrets of Japanese Geisha can leverage the sales team experience to cultivate customer relationships as Tsai Geisha is planning to shift buying processes online.
Need for greater diversity
– Tsai Geisha 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.
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.
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.
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 -
Developing new processes and practices
– Tsai Geisha can develop new processes and procedures in Innovation & Entrepreneurship 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.
Leveraging digital technologies
– Tsai Geisha 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.
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.
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.
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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Tsai Geisha can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Tsai Geisha can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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.
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.
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.
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.
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.
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 -
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.
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.
High dependence on third party suppliers
– Tsai Geisha 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.
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.
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.
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.
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.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Tsai Geisha needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Consumer confidence and its impact on Tsai Geisha 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tsai Geisha with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Tsai Geisha.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study TATCHA: Marketing the Beauty Secrets of Japanese Geisha, Tsai Geisha may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
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.
