BUS 317 Strategic Management

Ng Eyvon 32135999

Consumer, Automotive, Business Solutions and Licensing Maps, Traffic, Navigation, PND, Fleet, Fitness, Mobile, Places, Speedcams, Custom Systems, Location Based Services. GPS Navigation Services and Products Industry Consumer Electronics industry in 2012 worth US$770million, 5-year compounded annual growth rate = 2.1%

Financial Report North America market share for 2012 was 22%, 5% down compared to 2011. Did not participate in large promotional activities in the Christmas holiday season. Europe market share for the year was 46%, which was 1% up compared to 2011. LIVE Services and the SportWatch (Nike) From 2005 to 2007 the company had a consistent growth in revenue sales with a corresponding increase in net income. 2008 sees a decline in sales revenue of 3.7% and a net income decrease of 136%. Sales revenue further decreased in 2009. Garmin is still the leader in the market with a market share of 45% while TomTom has a market share of 24%.

Porters 5 Forces PEST Political - Satellite navigation systems need of satellites managed by governments, impose ban on navigation devices Economic global economic crisis, seen as luxury products and not a necessity, Mature U.S. and European mkt but many opportunities in developing countries Social Factors - Lack of information and education of population Technology Aging GPS satellites, GPS functionality is a standard feature on all new mobile smart phones. Legal Threat of Entrants Medium, Global Footprint, Availability of GPS Apps, standalone product. Threat of Substitutes Low, printed/online maps/brochures Power of Suppliers Low, outsources the manufacturing of all its PND and in-dash navigation systems, ability to limit capital expenditure risk, dual-sourced production from 2 different manufacturing partners. Power of Buyers Low, Fragmented, consume a unit a time, Car/phone manufacturers choses the system. Degree of Industrial Rivalry High, Garmin, price war

Core Competencies and Value Chain PND customer base: 50 million, leading in Europe and selling in 35 countries, large distribution network

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BUS 317 Strategic Management

Ng Eyvon 32135999

Innovative and reliable satellite navigation technology Different price range, partnerships to increase mkt share, pre-installation. Technology digital mapping, traffic and routing algorithm, unique voice navigation and POI info Marketing well known and established brand and pdts and svcs Operations supply chain partnerships, strategic contracts Supply portable navigation devices, built-in systems (partnership with Renault), software for mobile phones, internet and other online applications Vertical integration, partnerships and IPO to support innovation and R&D

Weaknesses Generic, suffering from continuous pressure from competition, decrease in retail prices of GPS units Unique selling proposition: heavily technical perceived more as a feature than a benefit. Devices do not have an established self-identity Increase in competition, price wars and entry of smart phones

Corporate Growth Strategies Vertically integrated owning key assets, IPO in 2005 (raised 469 million), Acquired Datafactory AG in 2006 (TomTom WORK), Applied Generics in 2007 (Mobility Solutions Services), Tele Atlas in 2008 Partnerships with Renault, Lexus, Mazda and Fiat, Advanced Integrated Solutions (itinerary planning and route guidance) Horizontal 4 business units

Defensive Strategies Innovation Focus on providing the best information and navigation solutions on multiple platforms

A competitive strategy but not a total winning strategy. Recommendations/Strategies Partnership or service agreement with a Smartphone or mobile network operator/manufacturer. Duplicate the successful Renault partnership with other motor and truck manufacturing companies. Expand and be innovative in the fleet industry. Augmented Reality (AR). Improvement in coverage and precision Pursue the competition into the mobile industry by creating a mobile handset. Focus on giving high quality information (in order to provide attractively different products from competitors)

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