eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry
In 2013 and 2014, eBay deployed several sets of large, interactive touch screens and related technologies in shopping malls and retail stores. These "connected technologies" were used in a variety of ways intended to benefit both shoppers and retailers. In one case, screens served as "digital storefronts" in four locations throughout New York City for a new fashion brand, Kate Spade Saturday. Shoppers could evaluate products using the screens, and transfer the transaction to their smartphone for completion. The company used these screens to launch its brand in New York, and to gather information about the best location for a physical store. In a shopping mall application, large screens were installed in vacant storefronts. In addition to providing shoppers with information about products, and the opportunity to buy, sensors collected detailed information about the flow of traffic near the screens, which could be used by the store or mall. This data included the number of people that passed the screen, looked at it, stopped at it, and interacted with it. This can be contrasted with online advertising, where page views are counted, but there is no way of knowing whether the person even noticed the advertisement. In another application, Rebecca Minkoff's first U.S. retail stores incorporated large touchscreens for browsing and selecting items to be taken to a fitting room. The fitting room mirror was also a touch screen, which the shopper could use to communicate with a sales associate, evaluate accessories or alternate colors, and view selections in different lighting conditions. This case describes technical innovations, and a potential vision for the future of retailing made possible by those innovations. It asks students how eBay should attempt to monetize these innovations, how the data collected should be packaged and utilized, and the implications of eBay's vision for retailing's future.
Swot Analysis of "eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry" written by Harikesh Nair, David Hoyt includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Screens Storefronts facing as an external strategic factors. Some of the topics covered in eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry case study are - Strategic Management Strategies, Marketing, Sales, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry casestudy better are - – challanges to central banks by blockchain based private currencies, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, technology disruption,
central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Screens Storefronts, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Screens Storefronts 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry can be done for the following purposes –
1. Strategic planning using facts provided in eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry case study
2. Improving business portfolio management of Screens Storefronts
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 Screens Storefronts
Strengths eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Screens Storefronts in eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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.
Strong track record of project management
– Screens Storefronts 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
– Screens Storefronts has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Screens Storefronts has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High brand equity
– Screens Storefronts has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Screens Storefronts to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Screens Storefronts is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Harikesh Nair, David Hoyt can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Innovation driven organization
– Screens Storefronts is one of the most innovative firm in sector. Manager in eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry firm has clearly differentiated products in the market place. This has enabled Screens Storefronts to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Screens Storefronts to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Screens Storefronts is present in almost all the verticals within the industry. This has provided firm in eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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
– Screens Storefronts is one of the leading recruiters in the industry. Managers in the eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Screens Storefronts 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Screens Storefronts 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Screens Storefronts 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry are -
Lack of clear differentiation of Screens Storefronts products
– To increase the profitability and margins on the products, Screens Storefronts needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– After analyzing the HBR case study eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry, 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.
High operating costs
– Compare to the competitors, firm in the HBR case study eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 Screens Storefronts 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Screens Storefronts 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.
Slow decision making process
– As mentioned earlier in the report, Screens Storefronts 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. Screens Storefronts 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry can leverage the sales team experience to cultivate customer relationships as Screens Storefronts is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Harikesh Nair, David Hoyt suggests that, Screens Storefronts 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.
Interest costs
– Compare to the competition, Screens Storefronts 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.
Need for greater diversity
– Screens Storefronts 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry, it seems that the employees of Screens Storefronts 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.
Capital Spending Reduction
– Even during the low interest decade, Screens Storefronts has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Opportunities eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry | 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry are -
Building a culture of innovation
– managers at Screens Storefronts 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.
Learning at scale
– Online learning technologies has now opened space for Screens Storefronts 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Screens Storefronts can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Screens Storefronts has opened avenues for new revenue streams for the organization in the industry. This can help Screens Storefronts to build a more holistic ecosystem as suggested in the eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry case study. Screens Storefronts can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Screens Storefronts 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, Screens Storefronts can use these opportunities to build new business models that can help the communities that Screens Storefronts operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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 Screens Storefronts 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.
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. Screens Storefronts 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. Screens Storefronts 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.
Better consumer reach
– The expansion of the 5G network will help Screens Storefronts to increase its market reach. Screens Storefronts 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Screens Storefronts is facing challenges because of the dominance of functional experts in the organization. eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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.
Leveraging digital technologies
– Screens Storefronts 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.
Manufacturing automation
– Screens Storefronts 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.
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 Screens Storefronts in the consumer business. Now Screens Storefronts can target international markets with far fewer capital restrictions requirements than the existing system.
Threats eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry are -
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.
High dependence on third party suppliers
– Screens Storefronts 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.
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 Screens Storefronts.
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. Screens Storefronts needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Screens Storefronts 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.
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 Screens Storefronts 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, Screens Storefronts 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry .
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 Screens Storefronts in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Screens Storefronts has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Screens Storefronts 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry, Screens Storefronts 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Screens Storefronts with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Screens Storefronts 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.
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. Screens Storefronts 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.
Weighted SWOT Analysis of eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 eBay's "Connected Technologies": Innovating Customer Engagement in the Retail Industry 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 Screens Storefronts needs to make to build a sustainable competitive advantage.
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