SeaWorld Entertainment (SEAS) SWOT Analysis / TOWS Matrix / MBA Resources
Recreational Activities
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for SeaWorld Entertainment (United States)
Based on various researches at Oak Spring University , SeaWorld Entertainment is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, there is backlash against globalization, central banks are concerned over increasing inflation, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models,
challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of SeaWorld Entertainment
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that SeaWorld Entertainment can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the SeaWorld Entertainment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which SeaWorld Entertainment 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 SeaWorld Entertainment can be done for the following purposes –
1. Strategic planning of SeaWorld Entertainment
2. Improving business portfolio management of SeaWorld Entertainment
3. Assessing feasibility of the new initiative in United States
4. Making a Recreational Activities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of SeaWorld Entertainment
Strengths of SeaWorld Entertainment | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of SeaWorld Entertainment are -
Diverse revenue streams
– SeaWorld Entertainment is present in almost all the verticals within the Recreational Activities industry. This has provided SeaWorld Entertainment 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.
Training and development
– SeaWorld Entertainment has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High brand equity
– SeaWorld Entertainment has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled SeaWorld Entertainment to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– SeaWorld Entertainment is one of the most innovative firm in Recreational Activities sector.
Strong track record of project management in the Recreational Activities industry
– SeaWorld Entertainment is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of SeaWorld Entertainment in the Services sector have low bargaining power. SeaWorld Entertainment has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps SeaWorld Entertainment to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– SeaWorld Entertainment is one of the leading players in the Recreational Activities industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Recreational Activities industry
– SeaWorld Entertainment has clearly differentiated products in the market place. This has enabled SeaWorld Entertainment to fetch slight price premium compare to the competitors in the Recreational Activities industry. The sustainable margins have also helped SeaWorld Entertainment to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– SeaWorld Entertainment has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – SeaWorld Entertainment staying ahead in the Recreational Activities industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the SeaWorld Entertainment 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.
Superior customer experience
– The customer experience strategy of SeaWorld Entertainment in Recreational Activities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– SeaWorld Entertainment has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Recreational Activities industry. Secondly the value chain collaborators of SeaWorld Entertainment have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of SeaWorld Entertainment | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SeaWorld Entertainment are -
Low market penetration in new markets
– Outside its home market of United States, SeaWorld Entertainment needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of SeaWorld Entertainment products
– To increase the profitability and margins on the products, SeaWorld Entertainment needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring in Recreational Activities industry
– The stress on hiring functional specialists at SeaWorld Entertainment 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.
High dependence on SeaWorld Entertainment ‘s star products
– The top 2 products and services of SeaWorld Entertainment still accounts for major business revenue. This dependence on star products in Recreational Activities industry has resulted into insufficient focus on developing new products, even though SeaWorld Entertainment has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at SeaWorld Entertainment, in the dynamic environment of Recreational Activities industry it has struggled to respond to the nimble upstart competition. SeaWorld Entertainment has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– From the 10K / annual statement of SeaWorld Entertainment, it seems that company is thinking out the frontier risks that can impact Recreational Activities industry. 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, SeaWorld Entertainment is slow explore the new channels of communication. These new channels of communication can help SeaWorld Entertainment to provide better information regarding Recreational Activities products and services. It can also build an online community to further reach out to potential customers.
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 SeaWorld Entertainment supply chain. Even after few cautionary changes, SeaWorld Entertainment is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left SeaWorld Entertainment vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of SeaWorld Entertainment strategy
– From the outside it seems that the employees of SeaWorld Entertainment 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, SeaWorld Entertainment 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 Recreational Activities industry using digital technology.
Aligning sales with marketing
– From the outside it seems that SeaWorld Entertainment needs to have more collaboration between its sales team and marketing team. Sales professionals in the Recreational Activities industry have deep experience in developing customer relationships. Marketing department at SeaWorld Entertainment can leverage the sales team experience to cultivate customer relationships as SeaWorld Entertainment is planning to shift buying processes online.
SeaWorld Entertainment Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of SeaWorld Entertainment are -
Leveraging digital technologies
– SeaWorld Entertainment 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.
Loyalty marketing
– SeaWorld Entertainment 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.
Buying journey improvements
– SeaWorld Entertainment can improve the customer journey of consumers in the Recreational Activities industry by using analytics and artificial intelligence. It 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for SeaWorld Entertainment 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 SeaWorld Entertainment to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help SeaWorld Entertainment to increase its market reach. SeaWorld Entertainment 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.
Creating value in data economy
– The success of analytics program of SeaWorld Entertainment has opened avenues for new revenue streams for the organization in Recreational Activities industry. This can help SeaWorld Entertainment to build a more holistic ecosystem for SeaWorld Entertainment products in the Recreational Activities industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions in Recreational Activities industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for SeaWorld Entertainment in the Recreational Activities industry. Now SeaWorld Entertainment can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Recreational Activities industry, but it has also influenced the consumer preferences. SeaWorld Entertainment can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, SeaWorld Entertainment can use these opportunities to build new business models that can help the communities that SeaWorld Entertainment operates in. Secondly it can use opportunities from government spending in Recreational Activities sector.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Recreational Activities industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. SeaWorld Entertainment 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. SeaWorld Entertainment 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.
Manufacturing automation
– SeaWorld Entertainment can use the latest technology developments to improve its manufacturing and designing process in Recreational Activities sector. 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, SeaWorld Entertainment 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, SeaWorld Entertainment 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 SeaWorld Entertainment to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats SeaWorld Entertainment External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of SeaWorld Entertainment 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 SeaWorld Entertainment in the Recreational Activities sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– SeaWorld Entertainment 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 Recreational Activities industry.
Regulatory challenges
– SeaWorld Entertainment 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 Recreational Activities industry regulations.
Shortening product life cycle
– it is one of the major threat that SeaWorld Entertainment is facing in Recreational Activities sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for SeaWorld Entertainment in Recreational Activities industry. The Recreational Activities 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.
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
– SeaWorld Entertainment 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.
Consumer confidence and its impact on SeaWorld Entertainment 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 Recreational Activities 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. SeaWorld Entertainment 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.
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.
Technology acceleration in Forth Industrial Revolution
– SeaWorld Entertainment has witnessed rapid integration of technology during Covid-19 in the Recreational Activities industry. As one of the leading players in the industry, SeaWorld Entertainment needs to keep up with the evolution of technology in the Recreational Activities 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.
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 SeaWorld Entertainment.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Recreational Activities industry are lowering. It can presents SeaWorld Entertainment with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Recreational Activities sector.
Weighted SWOT Analysis of SeaWorld Entertainment Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at SeaWorld Entertainment 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 SeaWorld Entertainment 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 SeaWorld Entertainment 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 SeaWorld Entertainment 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 SeaWorld Entertainment needs to make to build a sustainable competitive advantage.
