The Study of a Major Firm GoPro Marketing Strategy Report
TABLE OF CONTENTS
- INTRODUCTION.. 3
- COMPETITOR ANALYSIS. 3
- MARKET CHARACTERISTICS. 4
- BUSINESS STRATEGY.. 5
- ADVANTAGE OVER COMPETITORS. 5
- GOPRO RECENT PRICE CUT. 6
- REFERENCES. 8
GoPro Marketing Strategy – Introduction
GoPro was previously recognized as Woodman Labs, Inc. and transformed its name to GoPro, Inc. in February 2014. GoPro, Inc. have its headquarters in San Mateo, California and was originated in 2004 (GoPro Yahoo Finance, 2015). Consumer agony points linked with the managing, distributing, capturing and relishing attractive content are alleviated by GoPro’s software and hardware solutions. A HERO line of capture instruments including top accessories and cameras are offered by the company. Mounts are also offered by the company that empower the customer to attire that mount on their bodies such as wrist covers, head fastenings and chest binds. Furthermore, it also provides a video editing tool known as GoPro Studio that permits the users to generate expert and professional quality videos from the content of their GoPro. It permits users to easily and wirelessly manage, store and share content from cameras to mobile devices through GoPro App (GoPro Annual Report, 2014). The products of GoPro are marketed and sold through the retailers and wholesalers along with their official Website in United States and globally. The perfect entry-level GoPro cameras are Hero Cameras which they have introduced recently. The series of HERO 4 that allows live streaming, professional videography and premium quality photography and many other innovative features to capture and share (GoPro Annual Report, 2014).
GoPro Competitor Analysis
The competitors of the GoPro are Samsung Electronics, VIEVU, Eyesee360º, and Contour Adventure Every day (Rivalfox, 2015). Contour Cameras produces cameras that empowers contemporary time explorers, sportsmen and women, voyagers, specialists and amateurs to record their video story of adventure, travel and action (Contour Yahoo Finance, 2015). Single shot panoramic imaging front-runner is EyeSee360 for both the videography and still images (Bloomberg Business, 2015). VIEVU Cameras are manufactured for the Roughest Circumstances that are tremendously rocky, water-resistant, and easy to use (VIEVU, 2015). HD videos and audios can easily be made with these cameras with improved lowlight system and with Wi-Fi live streaming is also a function of these cameras. Samsung Electronics also manufacture cameras to stream live like Smart Camera with Wi-Fi connectivity (Samsung Yahoo Finance, 2015). Though GoPro, Inc. is one of the leading brands in the manufacturing of Action Cameras and it offers cameras with high innovation and technology.
The market for the GoPro is Action Cameras that allow to take the footage of high energy physical happenings including swimming, rock climbing, running and hunting. The GoPro channel on Pinterest has been introduced and viewers of its videos on social websites like YouTube etc. have been increasing (GoPro, 2015). The market size for the action cameras is likely to increase from 31 billion that was in 2013 to 51 billion till 2015 due to enhanced interest of consumers in these cameras. The market size of action cameras would increase because of attenuation in the market for traditional cameras. The increased market share of mobile phones is also attracting customers towards action cameras (Mani, 2014). The consumers of the action camera market are physically active people because they are users of smartphones and action cameras are subset of smartphones. The consumers are more interested in innovative technology and unique characteristics of devices. The competitors as discussed above are not operating as strongly as the GoPro that’s why the level of competitiveness is low (Mani, 2014). The entry barrier is high due to responsiveness and sensitivity of technological advancement and it is not easy for any of the company to attain the level of competitiveness at which GoPro has been operating. However, the large companies can enter in the market introducing similar products with innovations. A company operating in this market can easily exit from the market that’s why exit barrier is low. Though, the companies holding the major market share would find it difficult to exit from the market (Rose, 2015).
GoPro Business Strategy
GoPro uses the content management strategy and it strives to eradicate the critical point of dealing with content by allowing the customers to share and transfer material from the cameras to a system that competently systematizes the material and enables suitable sharing and editing. The early stages of the content management platform strategy are GoPro Studio and GoPro App. Moreover, GoPro is intended towards the expansion of current business of capturing and broadening of the assortment with content management. Therefore, the specific strategy GoPro uses to deliver improved worth to the consumers and distinguish from opponents is the content management and it is the key to their accomplishment.
Advantage over Competitors
Particular advantage got by GoPro over its competitors is its groundbreaking, exclusive and hero line of capture devices. It offers other equipment too that include standby series of batteries, charging accessories and data cables to attach its GoPro cameras to monitors and televisions to manage and transfer data. This advantage can stay as long as the company continues to provide innovative and unique capturing devices. Moreover, the new products launched must be in accordance with the market preferences so the significant market share held by the company could be maintained and further enhanced. GoPro (GPRO) is the front runner in the case of market share of i.e. 47.50%. The share of the company in the market is also likely to enhance. It is reported that 54% of the action camera owners own the cameras of GoPro, Inc. The share of the future purchase purposes of GoPro has also increased to 73%.
GoPro Recent Price Cut
The flagship product, HERO 4, has cut off by the GoPro by $100 after its launch. The main factor behind this downfall is the decreasing demands of consumers for action cameras and increasing demand for the smartphones. Customers mostly use the smartphone cameras for saving and capturing their activities and memories. GoPro has further abridged the amount of HERO 4 recently by $100. The main purpose cited for this price cut was the less willingness of consumers to pay such huge amounts for action cameras and GoPro’s intention was to upsurge the demand for action cameras by such belligerent price cut two times a year in the same invention (Maan & Tharakan, 2015).
The company that quickly became famous and synonymous for its body mounted cameras has failed in the launch of recently introduced product HERO 4 because consumers rely more on the smartphones for making great determination videos (Maan & Tharakan, 2015). This price cut causes the shares of the company to fall by 15 percent. The company said that the price cut of $200 from original price of $400 was necessary to manage the demand for the cameras. It is done to generate the level of demand for the action cameras and draw the attention of the consumers. The two potential follow on effects detected because of the price cut are increase in the number of units sold than the planned and decrease in the sales value of the company that has led it with the negative effect. The reason of failure of the recent session of HERO 4 is the snowballing reliance of consumers on the smartphones as compared to the action cameras. The huge price cut in the HERO 4 session is because of the decreasing demand of action cameras that also impacted the consumers, investors and managers of GoPro (Maan & Tharakan, 2015).
The 15 percent downfall in share price has also decreased the return that investors could have over their investment (Maan & Tharakan, 2015). This downfall would make the investors more cautious and curious about the performance of the company. The downfall will cause the profits to decrease and accordingly the returns given to investors will also decline. Growth rate and profits would decelerate a bit causing a slight decrease in the investor’s return. However, GoPro has managed to urge the investors to stick with the company for having long term benefits and telling that this substandard launch yet disproves the idea and notion that the invention is commoditized and GoPro have no real competition in this market that could help to sustain the margin caused in the sales price and revenues. The investors though are found to be skittish about the capability of the company to defend against the competition of Samsung that has been continuously upgrading its cameras for high resolution video. The managers of the company are also affected by this price cut because revenues are falling down that caused the managers and employees to think over the company’s ability. However, GoPro has made it sure that the company will be having the maintained position soon because of increased demand for the products due to this price cut (DiSavino & Reuters, 2015). The consumers will tend to buy the product because of decrease in the price of recent products. It would be beneficial for the consumers to buy the products on less prices. However, customers in the Americas, by far the company’s biggest market, appeared unwilling to shell out more money on relatively expensive cameras. Therefore, the decrease in the price would be desirable for the consumers.
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