Situational Analysis Cable industry
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Situational Analysis
Situational Analysis
Industry – Situational Analysis Cable industry
Environment
TFC is a successful company in the cable industry that has been recording profits ever since it entered the market. The cable company is a key player in a mature industry as evidenced by its revenue forecasts in 2006 ($310 million).
The cable channel has a wide presence in the market reaching more than 80 million households in the United States. Further, its most frequent client segment is women aged from 35 years to 54 years. However, much information about the company’s consumer segments remains unknown.
TFC has low level of technology adoption and this is proving to be a challenge as it needs to gain a competitive edge in a market that is slowly but steadily flooding with other entrants.
TFC already have a momentum in the market and they have established their products in the fashion programming industry.
Industry
The Fashion Channel is one of the cable channels with focus solely on fashion and entertainment programming.
Over the past, TFC has not been facing stiff competition from other cable firms.
There is high competition in the market emanating from new entrants in the market requiring more emphasis on branding, segmentation, as well as positioning from TFC (Lifetime and CNN have similar products to TFC that have notable ratings).
There are several cable affiliates entering the fashion and entertainment industry such as CNN and lifetime posing challenges to TFC.
Suppliers in the industry include Comcast, nationally, Time Warner, Cox, and Cablevision. Subscribers view TFC by subscribing to basic cable services from any of these operators. SWOT Analysis
Strength:
TFC stands as the only dedicated channel that dwells on fashion
The channel attracts the viewership of women aged between 35 and 54 years
The industry that the channel is involved in is unique
Steady growth since inception
High level of operational efficiency
TFC has a mass market philosophy that does not require a lot of resources
TFC has increased efficiency
TFC has managed to attain full penetration of households that are available
Opportunity:
FTC can increase its sales through majoring on advertising
Advertising campaigns can increase FTC’s rating
High technology might lead to increased quality and sales and quality.
Higher prices of advertisement will lead to increased revenue
Advertises are ready to pay a higher amount of money to get defined demographic and highly rated programming
There is additional room in the fashion programming industry
The demand of viewers for fashion content could maintain or increase the advertisement costs
Weakness:
Majoring on fashion and fashion related programming leaves TFC as a channel that is not diversified
The growth of the company was too rapid that the management did not carry out a clear segmentation
Some of the members in the company’s management are not willing to undertake changes
TFC has not defined any specific segment of viewers
The satisfaction of consumers is declining
Threat:
Other competitors in the market present stiff competition
Niche networks receive very little, $1, for every subscriber
FTC faces a sad possibility that their competitors may snatch their premium viewers
Problem
FTC face novel frontal attacks from challengers in the market, that is lifetime channels and CNN, who are increasingly capturing revenues and market share from it. It appears that FTC must do something better or different to remain the leader it has been over the past in the fashion programming sector. However, the problem that arises is that there is barely anyone who is willing to speak out the truth regarding the prevailing situation.
FTC has a hard task of devising new ways to appeal to consumers and satisfy their programming needs. The company must find new ways to segment its market and advertise to increase the number of viewers. The main questions that arise are:
How can TFC increase viewership?
How can TFC perform market segmentation?
How can TFC attract and define the viewership of men of all age groups and women aged between 18 and 34?
Alternatives
Facing Threats and Tapping Opportunities
The Fashion Channel ought to get new audiences to ensure that it competes adequately with CNN and Lifetime by:
Increasing its expenditure on marketing promotions by $15 million
Taking Wheeler’s advice of majoring on advertising
Using two key levers to increase growth
Increase the number of viewers to drive ratings up
Increase the pricing for advertisement
Deliver programming for particular target groups
Emotional connection
FTC needs to think outside the box to raise its popularity and maintain its competitive edge. The marketing department plays a critical role in ensuring that The Fashion Channel records high sales. The company can increase its popularity around the country by organizing for a live tour that will build its exposure on the major cities. While this is happening, the channel’s marketing department can offer promotional items that will grab the attention of people. The best marketing segment that the company can appeal to using this method is that of young people, men and women. This is because they relate with fashion and the promotion will create a domino effect among the young people.
Celebrity focus
FTC might consider using celebrity endorsement to drive sales and ratings. Celebrity endorsement is a proven method of marketing and can increase the viewership of program, especially if they appeal to the young viewers who identify more readily with celebrities (Leslie, 45). This will be a good strategy as the company is losing its competition to CNN, which is employing the celebrity focus tactic.
Technology
Technology is becoming increasingly common in the industry as well as viewers. TFC can increase its sales by adopting technological innovation greatly. Its efficiency will also increase as a result thereby increasing its popularity substantially. The company’s marketing department can capitalize on Dana Wheeler’s marketing plan, which will employ technological innovations. The marketing tools proposed by Wheeler include the use of the Internet to increase the awareness among consumers. In addition to that, technology will improve the quality of programming by the company (Eastman and Klein, 191).
Recommendation
Generally, The Fashion Channel ought to embrace new strategies to increase its viewership and returns. In a world that is constantly evolving, TFC requires to innovate to keep up with the competition. Advertising and promotional campaigns are a strong way of increasing the viewership of the channel’s programming and revenue. However, key consideration should be laid on segmentation to ensure that the company understands its consumer base properly. With segmentation, TFC will be able to deliver programmes that are relevant to specific groups and thereby reduce complains among consumers while increasing ratings.
Works Cited
Eastman, Tyler and Klein, Robert. “Media Promotion and Marketing for Broadcasting, Cable, and the Internet.” Taylor & Francis. 2006. Print.
Leslie, Larry. “Celebrity in the 21st century.” ABC-CLIO, 2011. Print.
