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McKinsey Prep > Industries - MF > Flashcards

Industries - MF Flashcards

1
Q

Airlines numbers:

Global Revenue:
Flights/year:
Global fleet size:
Metric tonnes of cargo:
World busiest airport/y

A

800B
30M
25k+
60M
94M/ano (ATL)

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2
Q

Airlines: 5 revenue drivers

A

Tickets + Ancillary
Cargo
Codeshare
Loyalty
Premium & business

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3
Q

Airlines: cost drivers

A

Fuel
Labor
Ops & Maintenance
Airport/Navigation fees
Distribution & Marketing
Others: insurance, rentals, IT, depreciation

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4
Q

Airlines: 6 key metrics

A

•Revenue Passenger Kilometers = paying passengers * distance traveled.
•Available Seat Kilometers = Number of seats * distance traveled
•Load factor = RPK/ASK
•Revenue per ASK = Tickets revenue / ASK
•Cost per ASK = Operating costs / ASK
• OTP: % flights On-time

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5
Q

AIRLINES:
6 strategies

A

Optimizing the network to match demand.
Increasing operational efficiency.
Enhancing ancillary revenues.
Focusing on customer satisfaction and loyalty.
Leveraging digital and data analytics.
Strategic cost management.

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6
Q

Automotive

Largest automaker and sales 2023

A

Toyota 10M

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7
Q

Automotive:
global sales (units)
global revenue (Bi)
Largest market (name/units)
Ford F Series sales (units/y)
Cars in the world (absolute units)

A

80M
3Bi
China w/ 26M
650k
1.5Bi cars

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8
Q

Automotive:
5 key players

A

Vehicle manufacturers;
Auto parts suppliers;
Dealerships and retail networks;
Ride-sharing/mobility;
Financial institutions.

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9
Q

Automotive
5 trends

A

Electric/autonomous
Digitization/connectivity
Environmental regulations
Shared Mobility
Tech companies

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10
Q

Automotive:
5 revenue drivers

A
  • Vehicle Sales (New and Used)
  • After-Sales Services
  • Financing and Insurance
  • Connected and Digital Services
  • Fleet Sales and Partnerships
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11
Q

Automotive
6 cost drivers

A
  • Raw Materials and Components;
  • Labor Costs;
  • Research and Development (R&D);
  • Manufacturing and Production;
  • Marketing and Sales.
  • Logistics & transportation
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12
Q

Automotive:
7 key metrics

A
  • Supply chain performance.
  • DSI (Days supply of inventory)
  • ATP: Average transaction price;
  • MSRP: Manufacturer’s suggested retail price
  • Dealer network performance
  • Fuel economy;
  • Warranty claims/quality
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13
Q

Energy:
5 trends

A
  • Renewables growth
  • Global policies (e.g., Paris Agreement)
  • Shale/fracking boom
  • Energy storage rise
  • Digitization/automation
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14
Q

Energy:
5 forces

A
  • Decarbonization
    • Electrification
    • Expanding access
    • Efficiency focus
    • Digital transformation

  • Decarbonization is essential, with a focus on renewable energy, efficiency, and carbon capture technologies.
    • Electrification of transport, heating, and industry will require significant investments in infrastructure and technologies.
    • Expanding energy access to underserved populations is critical, needing both grid and off-grid solutions.
    • Energy efficiency is vital for reducing emissions, involving technology, policy, and behavior changes.
    • The future of energy is increasingly digital, with AI, data analytics, and IoT playing key roles.
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15
Q

Energy: 5 revenue drivers

A
  • Oil & Gas: Extraction, refining.
    • Coal: Mining, electricity, steel.
    • Electricity: Generation, distribution.
    • Renewables: Solar, wind, hydro.
    • Energy Services: Efficiency, consulting.

  • Oil and gas: Extraction, refining, and sale of crude oil and natural gas.
    • Coal production: Mining and sale of coal, mainly for electricity and steel production.
    • Electricity: Generation and distribution from fossil fuels, nuclear, and renewables.
    • Renewables: Manufacturing, installation, maintenance, and sale of renewable energy.
    • Energy services: Management systems, smart grids, and efficiency consulting.
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16
Q

Energy:
5 cost drivers

A
  • CapEx: Infrastructure costs.
    • Operating: Labor, maintenance.
    • Tech Development: Renewables, storage.
    • Regulations: Compliance costs.
    • Environmental: Emission controls.

Capital expenditures: Infrastructure costs, e.g., power plants and pipelines.
* Operating costs: Labor, fuel, and maintenance, especially in harsh environments.
* Technology development: Costs of new technologies, e.g., renewables and storage.
* Government regulations: Compliance costs for environmental and safety standards.
* Environmental impact: Emission control technologies and sustainable operations.

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17
Q

Energy:
5 key metrics for Oil/gas

A
  • ROIC: Capital efficiency.
    • RRR: Reserves sustainability.
    • Production Volume: Output levels.
    • Production Costs: Operational expenses.
    • Revenue/BOE: Profitability measure.

  • ROIC: Efficiency in allocating capital to profitable investments.
    • Reserves replacement ratio: Measures oil and gas reserves sustainability.
    • Production volume: Amount of oil and gas produced, usually in BOE/day.
    • Production costs: Total cost of producing oil and gas, from exploration to operations.
    • Revenue per BOE: Revenue generated per unit of oil or gas produced.
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18
Q

Energy:
5 key metrics for renewables

A
  • Installed Capacity: MW, GW scale.
    • Capacity Factor: Output efficiency.
    • Levelized cost of energy (LCOE): Cost per energy unit.
    • Energy Output: Actual vs. potential.
    • Market Share: Capacity, efficiency.

  • Installed capacity: Total power generation capacity in MW or GW.
    • Capacity factor: Efficiency ratio of actual output to potential full capacity output.
    • LCOE: Average cost per unit of electricity over the project’s lifetime.
    • Energy output: Actual energy produced compared to maximum possible output.
    • Market share: Assessed through installed capacity and energy production efficiency.
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19
Q

Entertainment:
Netflix subscribers

A

Netflix subscribers: 280M

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20
Q

Entertainment & Media
5 key-players

A
  • Film/TV: Streaming, production, distribution.
    • Music: Streaming, merchandise, live performances.
    • Video Games: Design, development, publishing.
    • Print/Publishing: Books, magazines, digital content.
    • Sports: Leagues, ticket sales, broadcasting rights.

  • Film and Television: Content production and distribution, dominated by streaming services like Netflix, Disney, and Hulu.
    • Music: Revenue from streaming, merchandise, and live performances, led by Universal Music Group, Sony Music, and Spotify.
    • Video Games: Design and publishing for consoles, PCs, and mobile; revenue from sales and in-game purchases; key players include Tencent, Activision, and Microsoft Xbox.
    • Print and Publishing: Books, magazines, revenue through sales and licensing; major players include The Wall Street Journal, Penguin Random House, and The Economist.
    • Sports: Revenue from ticket sales, broadcasting, and licensing; major leagues include the NBA, Premier League Soccer, and F1 Racing.
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21
Q

Entertainment & Media
5 trends

A
  • Digital Disruption: Streaming, social media rise.
  • Consolidation: Mergers, e.g., Disney-Fox.
  • Globalization: Expanding markets, audiences.
  • Fan Culture: Fans influence content, marketing.
  • Diversity: Focus on representation and inclusion.

Digital Disruption: Rise of streaming, social media, and mobile reshaping traditional media.
Consolidation: Mergers forming powerful conglomerates, e.g., Disney-Fox, AT&T-Time Warner.
Globalization: Expansion into new markets to capture international audiences and revenue.
Fan Culture: Fans driving marketing, content creation, and new franchises.
Diversity and Inclusion: Emphasis on representation and diverse storytelling in media.

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22
Q

E&M:
5 forces of the future

A
  • Streaming Wars: Competing platforms, content.
  • Personalization: AI-driven recommendations.
  • AR/VR: Immersive experiences, e.g., Fortnite concert.
  • Social Media: Influencer marketing, engagement.
  • Original Content: High investment in exclusives.

  • Streaming Wars: Intense competition among services like Netflix and Disney+, pushing content innovation.
    • Personalization and AI: Use of AI for personalized content recommendations and targeted ads.
    • Augmented and Virtual Reality: AR/VR creating immersive experiences in gaming and live events, like Fortnite’s Travis Scott concert.
    • Social Media and Influencers: Growing role of influencers and social media for content promotion and audience engagement.
    • Original Content Investment: High stakes investment in exclusive and original content by major platforms.
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23
Q

E&M:
6 revenue drivers

A

  • Advertising: Revenue from ads on TV, streaming, social media, branded content, and influencer partnerships.
    • Subscription Fees: Recurring charges for access to streaming, gaming, and other subscription services.
    • Box Office: Income from ticket sales and related merchandise for theatrical film releases.
    • In-App Purchases (IAP): Revenue from purchases within games, enhancing engagement and monetization.
    • Licensing & Merchandising: Income from licensing content and selling related merchandise, including toys and events.
    • Live Events: Revenue from ticket sales, merchandise, sponsorships, and partnerships at concerts, sports, and other live events.
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24
Q

E&M:
5 cost drivers

A
  • Production Costs: Creating films, shows, music, and games.
  • Marketing & Promotion: Advertising, PR, and promotions.
  • Distribution: Costs for physical and digital delivery.
  • Talent & Royalties: Payments to creators and performers.
  • Technology: Platform upkeep and tech investments.

  • Content Production: High costs for creating movies, shows, music, and games (e.g., $15M per episode for “Game of Thrones”).
    • Marketing & Promotion: Expenses for advertising and public relations, such as $150M for “Avatar.”
    • Distribution & Delivery: Costs for distributing content via physical and digital channels, including theaters and online platforms.
    • Talent & Royalties: Payments to artists, actors, and creators, often a significant portion of overall costs.
    • Technology & Platform Maintenance: Ongoing investments in digital platforms and technologies for content delivery.
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25
Q

E&M:
5 key-metrics

A
  • Engagement Metrics: Views, likes, shares, and watch time.
  • Revenue Metrics: ARPU, box office, and sales figures.
  • Audience Metrics: Nielsen ratings, demographics.
  • Retention Metrics: Churn rate, customer lifetime value.
  • Performance Metrics: Box-office, Profitability, cost efficiency.

  • Audience Engagement: Metrics like views, likes, and shares to gauge content resonance and audience loyalty.
    • Nielsen Ratings: Estimates of TV audience size and demographics, though less relevant with digital data advancements.
    • ARPU (Average Revenue Per User): Measures revenue per user across various platforms, aiding in cross-category comparisons.
    • Churn Rate: Tracks the rate of subscription cancellations, critical for subscription-based services.
    • Box Office Revenue: Key metric for film success, influencing future productions and industry decisions.
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26
Q

Finance:
5 key-players

A
  • Banks
  • Investment Companies
  • Brokerage Firms
  • Payment Service Providers
  • Credit Card Companies

  • Banks: Accept deposits, offer loans, and provide financial products like checking and savings accounts.
    • Investment Companies: Manage pooled funds from investors, offering products like mutual funds and ETFs.
    • Brokerage Firms: Facilitate buying and selling of securities, provide investment advice, and manage portfolios.
    • Payment Service Providers: Facilitate fund transfers and payment processing for individuals and businesses.
    • Credit Card Companies: Offer credit to consumers with interest on unpaid balances and provide various payment solutions.
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27
Q

Finance:
5 major trends

A
  • Deregulation and Globalization
  • Technological Advancements
  • Consolidation and M&A Activity
  • Focus on Risk Management and Compliance
  • Rise of Fintech

  • Deregulation and Globalization: Increased competition and interconnectedness in global financial markets, leading to innovation and consolidation.
    • Technological Advancements: Digital payments, mobile banking, and blockchain are disrupting traditional models and creating growth opportunities.
    • Consolidation and M&A Activity: Significant mergers and acquisitions, leading to fewer, larger, diversified financial institutions.
    • Focus on Risk Management and Compliance: Post-crisis emphasis on regulatory oversight and new risk management techniques.
    • Rise of Fintech: Fintech firms are disrupting traditional services with more accessible, cost-effective solutions, challenging established players.
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28
Q

Finance:
5 Forces Shaping the Future

A
  • Open Banking and API Platforms
  • Adoption of Blockchain and Digital Currencies
  • Expansion into Emerging Markets
  • Disintermediation
  • AI and Machine Learning

  • Open Banking and API Platforms: Expected growth in collaborative platforms between banks, fintechs, and third parties, enhancing innovation but posing data privacy challenges.
    • Adoption of Blockchain and Digital Currencies: Potentially transformative technologies for transactions, though their exact future impact remains uncertain.
    • Expansion into Emerging Markets: Growth opportunities in new markets with complex regulatory and cultural landscapes.
    • Disintermediation: Direct-to-consumer financial products bypassing traditional intermediaries, with increasing competition from non-traditional entrants.
    • AI and Machine Learning: Increasing use for automating processes, enhancing customer experience, and improving risk management, driving efficiency in decision-making.
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29
Q

Finance:
5 revenue drivers

A
  • Interest Income
    • Fee-based Income
    • Investment Banking Revenue
    • Trading Revenue
    • Asset Management Fees

  • Interest Income: Earned from loans and interest-bearing assets, crucial for banks.
    • Fee-based Income: Includes fees for services like account maintenance and advisory.
    • Investment Banking Revenue: Fees from underwriting, M&A advisory, often volatile but lucrative.
    • Trading Revenue: Income from trading commissions and spreads on stocks, bonds, and derivatives.
    • Asset Management Fees: Charges for managing client assets, based on AUM.
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30
Q

Finance: 5 Cost Drivers

A
  • Employee Compensation and Benefits
    • Regulatory Compliance
    • Facilities and Real Estate
    • Marketing and Advertising
    • Technology and Infrastructure

  • Employee Compensation and Benefits: Major expense covering salaries, bonuses, and benefits.
    • Regulatory Compliance: Costs for adhering to laws and regulations, such as anti-money laundering.
    • Facilities and Real Estate: Expenses for office spaces, data centers, and branches.
    • Marketing and Advertising: Investment in brand building, customer acquisition, and retention.
    • Technology and Infrastructure: Costs for essential tech and systems supporting operations.
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31
Q

Finance: 5 key-metrics

A
  • Return on Equity (ROE)
    • Net Interest Margin (NIM)
    • Assets Under Management (AUM)
    • Total Transactions
    • Payment Volume

  • Return on Equity (ROE): Measures profitability as net income relative to shareholders’ equity.
    • Net Interest Margin (NIM): Spread between interest income and expense, key for banks.
    • Assets Under Management (AUM): Total assets managed, indicating scale and fee potential.
    • Total Transactions: Number of payments processed, showing business volume.
    • Payment Volume: Total value of payments processed, reflecting the scale of operations.
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32
Q

HOSPITALITY

Hospitality:
5 key-players

A
  • Accommodation
    • Travel Experiences
    • Entertainment and Recreation
    • Gaming
    • Vacation Ownership

  • Accommodation: Companies that provide lodging services like hotels, motels, and resorts, often offering amenities such as pools, fitness centers, and business services.
    • Travel Experiences: Companies offering transportation and travel-related services, including travel agencies, tour operators, and cruise lines, often bundling flights, accommodations, and activities.
    • Entertainment and Recreation: Providers of leisure services such as theme parks, casinos, and theaters, offering a variety of attractions for guests of all ages.
    • Gaming: Companies offering casino gaming services, including slot machines, table games, and sports betting, often coupled with hotel accommodations and entertainment.
    • Vacation Ownership: Providers of timeshare and vacation ownership services, allowing customers to purchase use rights for vacation properties, typically with resort-style amenities.
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33
Q

Hospitality:
5 trends & events

A
  • Rise of Online Travel Agencies (OTAs)
    • Growth of Airbnb
    • Emphasis on Sustainability
    • COVID-19 Pandemic
    • Technology Advancements

  • Rise of Online Travel Agencies (OTAs): OTAs like Expedia and Booking.com have made booking accommodations easier for consumers and increased competition in the industry.
    • Growth of Airbnb: Airbnb has disrupted traditional hotels by allowing homeowners to rent properties, pushing hotels to differentiate through consistent service.
    • Emphasis on Sustainability: The industry is adopting eco-friendly practices, like reducing water usage and offering less frequent sheet and towel washing during stays.
    • COVID-19 Pandemic: The pandemic severely impacted the industry, leading to temporary closures and new protocols like enhanced cleaning and contactless check-ins.
    • Technology Advancements: Innovations such as mobile check-in, mobile payments, and virtual reality tours have significantly transformed the guest experience.
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34
Q

Hospitality: 5 forces shaping the future

A
  • Personalization
    • Alternative Accommodations
    • Sustainability
    • Technological Integration
    • Evolving Consumer Expectations

  • Personalization: Using data and technology to offer customized services, such as Ritz-Carlton’s CRM system that tracks guest preferences to personalize experiences.
    • Alternative Accommodations: The rise of vacation rentals and home-sharing platforms is pushing hotels to innovate and offer unique amenities to stay competitive.
    • Sustainability: Environmental concerns are driving companies to adopt sustainable practices, reducing their impact on the environment.
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35
Q

Hospitality: 5 Revenue Drivers

A
  • Room Revenue
    • Food and Beverage Revenue
    • Meeting and Event Revenue
    • Ancillary Revenue
    • Other Sources

  • Room Revenue: The primary source of income for hotels, influenced by room type, location, and season.
    • Food and Beverage Revenue: Generated from restaurants, bars, room service, and event catering within the hotel.
    • Meeting and Event Revenue: Income from renting out conference and meeting spaces for events like weddings and business meetings.
    • Ancillary Revenue: Includes additional services such as parking, laundry, and spa treatments.
    • Other Sources: Revenue from retail sales, gaming, and investment income, significant in gaming-focused hotels.
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36
Q

Hospitality: 5 Cost Drivers

A
  • Labor Costs
    • Real Estate Costs
    • Food and Beverage Costs
    • Maintenance and Utilities
    • Marketing and Advertising

  • Labor Costs: Largest expense, covering wages, salaries, and benefits for hotel staff such as front desk employees and housekeeping.
    • Real Estate Costs: Expenses associated with purchasing or leasing hotel properties.
    • Food and Beverage Costs: Costs of purchasing ingredients and supplies for hotel restaurants and catering services.
    • Maintenance and Utilities: Ongoing costs for property upkeep, repairs, and utilities such as electricity and water.
    • Marketing and Advertising: Investment in promoting the hotel brand and attracting guests through various marketing channels.
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37
Q

Hospitality: 5 Key Metrics

A
  • Occupancy Rate
    • Average Daily Rate (ADR)
    • Revenue per Available Room (RevPAR)
    • Customer Satisfaction
    • Employee Satisfaction

  • Occupancy Rate: Measures the percentage of available rooms that are occupied, indicating demand.
    • Average Daily Rate (ADR): The average revenue earned per occupied room, crucial for pricing strategy.
    • Revenue per Available Room (RevPAR): Combines occupancy rate and ADR to assess overall revenue performance.
    • Customer Satisfaction: Feedback from guests, used to gauge service quality and identify improvement areas.
    • Employee Satisfaction: Measures staff contentment, impacting motivation, productivity, and guest service quality.
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38
Q

Pharmaceutical: 5 Key Players

A
  • Drug Discovery and Development
    • Drug Manufacturers
    • Service Providers
    • Distributors and Retailers
    • Pharmacy Benefit Managers (PBMs)

  • Drug Discovery and Development: Focused on R&D of new medications, often using cutting-edge science and technology. Includes biotech companies that develop drugs using living organisms.
    • Drug Manufacturers: Includes both brand-name and generic manufacturers, with brand-name companies focusing on patented drugs and generics providing affordable alternatives once patents expire.
    • Service Providers: Offer support services like clinical trials (CROs) and regulatory compliance, helping navigate complex regulatory procedures.
    • Distributors and Retailers: Intermediaries in the supply chain, with distributors delivering drugs to pharmacies and retailers selling medications to consumers.
    • Pharmacy Benefit Managers (PBMs): Manage prescription drug benefits for insurers, negotiating prices and reimbursement rates to control healthcare costs.
39
Q

Pharmaceutical: 3 Major Trends

A
  • Biotechnology Revolution
  • Patent Expirations and Generics
  • Increased Regulation

  • Biotechnology Revolution: Rise of new drug classes like monoclonal antibodies, gene therapies, and innovative treatments driven by biotech advancements.
  • Patent Expirations and Generics: Increased competition from generics post-patent expirations, leading to price reductions and the emergence of biosimilars.
  • Increased Regulation: More stringent regulations in drug safety and pricing, impacting industry operations and compliance requirements.
40
Q

Pharmaceutical: 5 Forces Shaping the Future

A
  • Rare Diseases Efforts
    • Value-Based Healthcare
    • Greater Collaboration and Partnerships
    • Personalized Medicine
    • Technological Integration

  • Rare Diseases Efforts: Continued focus on orphan drugs to address rare diseases, expanding treatment options for previously underserved conditions.
    • Value-Based Healthcare: Emphasis on outcomes and cost-efficiency, promoting prevention, early detection, and tailored treatments.
    • Greater Collaboration and Partnerships: Increased cooperation among stakeholders to improve drug development and access to medicines.
    • Personalized Medicine: Advancing genomics and targeted treatments, tailoring therapies to individual patients for more effective outcomes.
    • Technological Integration: Leveraging technology for better healthcare delivery, including advancements in data analytics, genomics, and patient management.
41
Q

Pharmaceutical: 5 Revenue Drivers

A
  • Prescription Drugs
    • Biologics
    • Vaccines
    • Over-the-Counter (OTC) Drugs
    • Medical Devices

  • Prescription Drugs: The largest revenue generator, accounting for over 70% of total industry revenue, with oncology drugs as a significant growth segment.
    • Biologics: Complex drugs made from living organisms, among the most expensive on the market.
    • Vaccines: Driven by demand increases, especially post-COVID-19, with the market expected to reach $100 billion by 2025.
    • Over-the-Counter (OTC) Drugs: Easily accessible without prescriptions, contributing significantly to revenue, with popular examples like Tylenol and Advil.
    • Medical Devices: Tools and equipment used in medical settings, providing an additional revenue stream alongside drugs and biologics.
42
Q

Pharmaceutical: 5 Cost Drivers

A
  • Research and Development (R&D)
    • Manufacturing Costs
    • Marketing and Sales Costs
    • Regulatory Compliance
    • Distribution and Supply Chain

  • Research and Development (R&D): High costs due to the complexity and duration of developing new drugs, averaging $2.6 billion per new drug.
    • Manufacturing Costs: Vary by drug type, with biologics often being more expensive to produce than small molecule drugs.
    • Marketing and Sales Costs: Significant investment in advertising, sales reps, and promotional activities to drive drug sales.
    • Regulatory Compliance: Costs associated with meeting strict regulations and guidelines from bodies like the FDA.
    • Distribution and Supply Chain: Expenses involved in transporting drugs through complex supply chains involving multiple intermediaries.
43
Q

Pharmaceutical: 5 Key Metrics

A
  • Clinical Trial Timelines
    • Time-to-Market
    • Pipeline Depth
    • Clinical Trial Success Rate
    • Sales per Rep

  • Clinical Trial Timelines: Measures the duration of clinical trials, indicating a company’s efficiency in progressing drugs to market.
    • Time-to-Market: Tracks the total time from drug discovery to market launch, reflecting innovation speed and market competitiveness.
    • Pipeline Depth: Reflects the number of potential new drugs in development, indicating growth potential and R&D effectiveness.
    • Clinical Trial Success Rate: Percentage of trials advancing to the next phase and reaching approval, showing R&D success likelihood.
    • Sales per Rep: Evaluates the revenue generated per sales representative, assessing sales force effectiveness.
44
Q

Retail: 5 Major Trends & Events

A
  • Rise of E-commerce
  • Omnichannel Retailing
  • Mobile Commerce
  • Sustainability and Ethical Sourcing
  • Technological Integration

  • Rise of E-commerce: The growth of online shopping has disrupted traditional retail, leading many to develop omnichannel strategies.
    • Omnichannel Retailing: Integration of online and offline channels to meet consumer demands for convenience and flexibility.
    • Mobile Commerce: The rise of smartphones has enabled anytime, anywhere shopping, becoming a key part of e-commerce.
    • Sustainability and Ethical Sourcing: Retailers are investing in eco-friendly and ethical practices to meet consumer demand for responsible products.
    • Technological Integration: Advances in AI, machine learning, and other technologies are driving personalized and efficient shopping experiences.
45
Q

Retail: 5 kinds of retailers

A
  • Brick-and-Mortar
  • Online Retailers
  • Omnichannel Retailers
  • Discount Retailers
  • Luxury Retailers

  • Brick-and-Mortar: Traditional physical stores where customers shop in person, allowing them to experience products directly.
    • Online Retailers: Operate exclusively on the internet, offering convenience, wide selections, and easy comparison shopping.
    • Omnichannel Retailers: Integrate physical and online platforms to provide a seamless shopping experience across all channels.
    • Discount Retailers: Focus on low prices, appealing to cost-conscious consumers, often selling in high volumes or with minimal services.
    • Luxury Retailers: Sell high-end, designer products associated with status and quality, emphasizing superior service and experience.
46
Q

Retail: 5 Forces Shaping the Future

A
  • Personalization
  • Frictionless Checkout
  • Unified Commerce
  • Augmented Reality (AR) and Virtual Reality (VR)
  • Advanced Analytics

  • Personalization: Use of AI and machine learning to tailor shopping experiences, recommendations, and promotions to individual customers.
  • Frictionless Checkout: Technologies like contactless payments, self-checkout, and mobile payments that streamline the purchasing process.
  • Unified Commerce: Integration of all retail channels, enabling features like buy online/pickup in-store and real-time inventory tracking.
  • Augmented Reality (AR) and Virtual Reality (VR): Technologies that offer immersive shopping experiences, such as virtual try-ons and product demonstrations.
  • Advanced Analytics: Leveraging data to understand consumer behavior, optimize inventory, and personalize marketing efforts.
47
Q

Retail: 5 Revenue Drivers

A
  • Consumer Spending
    • E-commerce Sales
    • Store Traffic and Footfall
    • Product Pricing and Margins
    • Inventory Management and Supply Chain Optimization

  • Consumer Spending: Driven by economic factors like income levels, employment rates, and interest rates, it’s the primary revenue source for retailers.
    • E-commerce Sales: Sales made through online platforms, including websites, mobile apps, and social media, have become a major revenue stream.
    • Store Traffic and Footfall: The number of visitors to physical stores; more foot traffic means more sales opportunities.
    • Product Pricing and Margins: Revenue generated by selling products at a markup; effective pricing strategies can optimize profit margins.
    • Inventory Management and Supply Chain Optimization: Efficient strategies ensure product availability, reduce costs, and increase revenue.
48
Q

Retail: 5 Cost Drivers

A
  • Cost of Goods Sold (COGS)
    • Rent and Occupancy Costs
    • Labor and Staffing Costs
    • Marketing and Advertising Expenses
    • Inventory Carrying Costs

  • Cost of Goods Sold (COGS): Direct costs of acquiring products, such as materials and distribution, directly impacting profit margins.
    • Rent and Occupancy Costs: Expenses related to leasing store locations, including utilities and maintenance, varying by location and store size.
    • Labor and Staffing Costs: Wages, salaries, and benefits for employees, significant especially in large workforces or high turnover environments.
    • Marketing and Advertising Expenses: Costs for promoting products and attracting customers, including campaigns and digital marketing efforts.
    • Inventory Carrying Costs: Includes warehousing, transportation, and insurance, which are substantial for retailers with large or slow-moving inventory.
49
Q

Retail: 5 Key Metrics

A
  • Average Order Value (AOV)
    • Conversion Rate
    • Foot Traffic or Footfall
    • Sales per Square Foot
    • Inventory Turnover

  • Average Order Value (AOV): The average spend per transaction, used to assess upselling opportunities and promotion effectiveness.
    • Conversion Rate: The percentage of visitors who make a purchase, indicating sales funnel effectiveness and areas for improvement.
    • Foot Traffic or Footfall: Measures store visitor numbers, helping gauge marketing and merchandising success and identify conversion issues.
    • Sales per Square Foot: Assesses sales efficiency relative to store size, allowing comparisons across different locations and categories.
    • Inventory Turnover: Tracks how often inventory is sold and replaced, highlighting inventory management efficiency and opportunities for improvement.
50
Q

Telecom: 5 Key Players

A
  • Telecom Carriers
    • Equipment Manufacturers
    • Internet Service Providers (ISPs)
    • Mobile Device Manufacturers
    • Network Infrastructure Providers

  • Telecom Carriers: Provide communication services, including voice, text, and data, to consumers and businesses, encompassing both traditional and mobile service providers.
    • Equipment Manufacturers: Produce the infrastructure and devices needed for communication services, such as network equipment and mobile devices.
    • Internet Service Providers (ISPs): Offer internet connectivity services, including cable, DSL, and fiber, to households and businesses.
    • Mobile Device Manufacturers: Focus on producing smartphones, tablets, and other mobile communication devices essential for connectivity.
    • Network Infrastructure Providers: Companies that develop and provide essential network components like routers, switches, and 5G infrastructure.
51
Q

Telecom: 5 Major Trends & Events

A
  • Rise of the Internet
    • Rise of Mobile
    • Deregulation
    • Shift to Data Services
    • Expansion of Broadband Access

  • Rise of the Internet: The proliferation of internet services has transformed telecom, shifting focus from traditional voice services to data and broadband.
    • Rise of Mobile: Mobile phones and smartphones have revolutionized communication, driving telecom providers to prioritize mobile services.
    • Deregulation: Reduced regulatory barriers have increased competition, lowered prices, and spurred innovation in the telecom sector.
    • Shift to Data Services: As voice services decline, telecom companies are focusing on data plans and internet services to drive revenue.
    • Expansion of Broadband Access: Increasing global access to high-speed internet has become a priority, impacting service delivery and market strategies.
52
Q

Telecom: 5 Forces Shaping the Future

A
  • 5G Technology
    • Internet of Things (IoT)
    • Cloud Services
    • Artificial Intelligence and Automation
    • Enhanced Security and Privacy

  • 5G Technology: Expected to transform telecom with faster speeds, lower latency, and the capacity to support new applications like autonomous vehicles and smart cities.
    • Internet of Things (IoT): Growth in connected devices, from appliances to wearables, provides new opportunities for data and connectivity services.
    • Cloud Services: The shift towards cloud-based solutions increases demand for reliable connectivity, with telecom companies benefitting as key infrastructure providers.
    • Artificial Intelligence and Automation: AI and automation in network management, customer service, and operations are enhancing efficiency and service quality.
    • Enhanced Security and Privacy: As connectivity expands, telecom companies are increasingly focused on cybersecurity and protecting user data.
53
Q

Telecom: 5 Revenue Drivers

A
  • Subscription Revenue
    • Equipment Sales
    • Value-Added Services
    • Enterprise Services
    • Roaming and International Services

  • Subscription Revenue: Generated from customers subscribing to telecom services such as mobile phone plans, internet packages, and TV subscriptions.
    • Equipment Sales: Revenue from selling telecom devices like smartphones and routers, as well as network infrastructure equipment.
    • Value-Added Services: Income from additional services like cloud storage, video streaming, and online advertising.
    • Enterprise Services: Revenue from providing telecom solutions to businesses, including network infrastructure and data center services.
    • Roaming and International Services: Earnings from mobile and internet services for customers traveling internationally and partnerships with global telecom companies.
54
Q

Telecom: 5 Cost Drivers

A
  • Network Infrastructure
    • Spectrum Licenses
    • Marketing and Advertising
    • Workforce & Labor
    • Regulatory Compliance

  • Network Infrastructure: Costs for building and maintaining the physical network, including cell towers and fiber optics, especially with new technologies like 5G.
    • Spectrum Licenses: High costs associated with acquiring rights to use wireless spectrum, crucial for service delivery.
    • Marketing and Advertising: Expenses for promoting services to stay competitive, involving advertising, PR, and customer acquisition efforts.
    • Workforce & Labor: Costs related to hiring skilled workers for network maintenance, sales, and customer service roles.
    • Regulatory Compliance: Expenses to meet government regulations on network security, privacy, and consumer protection, varying by region.
55
Q

Healthcare: 5 Cost Drivers

A

”* Labor Costs
* R&D Expenses
* Regulatory Compliance
* Technology and Equipment
* Supply Chain Management”

”* Labor Costs: Salaries for healthcare professionals, administrative staff, and support workers.
* R&D Expenses: High costs of research and development, particularly in pharmaceuticals and medical devices.
* Regulatory Compliance: Costs related to meeting healthcare regulations and standards.
* Technology and Equipment: Investment in medical equipment, IT systems, and digital health platforms.
* Supply Chain Management: Costs for procuring medical supplies, pharmaceuticals, and devices.”

56
Q

Healthcare: 5 Revenue Drivers

A
  • Patient Services
  • Pharmaceutical Sales
  • Medical Device Sales
  • Insurance Premiums
  • Digital Health Services”

  • Patient Services: Revenue from medical procedures, surgeries, and hospital stays.
  • Pharmaceutical Sales: Income from the sale of prescription drugs and vaccines.
  • Medical Device Sales: Revenue from selling diagnostic and therapeutic devices.
  • Insurance Premiums: Earnings from health insurance plans sold to individuals and employers.
  • Digital Health Services: Income from telehealth, health apps, and digital platforms.”
57
Q

Healthcare: 5 Key Metrics

A
  • Patient Satisfaction
  • Readmission Rates
  • Cost per Patient
  • Bed Occupancy Rate
  • Treatment Success Rate”

  • Patient Satisfaction: Measures patient experience and quality of care.
  • Readmission Rates: Percentage of patients who return to the hospital after discharge, indicating care quality.
  • Cost per Patient: Average cost of care per patient, reflecting operational efficiency.
  • Bed Occupancy Rate: Utilization of hospital bed capacity.
  • Treatment Success Rate: Effectiveness of treatments and procedures in achieving desired health outcomes.”
58
Q

Tech (Hardware): 5 Key Players

A

”* Component Suppliers
* OEMs (Original Equipment Manufacturers)
* Contract Manufacturers
* Distributors and Retailers
* Regulatory Bodies”

”* Component Suppliers: Provide essential parts such as semiconductors, displays, batteries, and other critical components necessary for hardware manufacturing.
* OEMs: Companies that design and manufacture devices under their own brand or for other companies.
* Contract Manufacturers: Firms that handle the assembly and production of hardware devices, often operating large-scale factories and supply chains.
* Distributors and Retailers: Entities that handle the logistics of getting products from manufacturers to end-users, including both online and physical retail channels.
* Regulatory Bodies: Government agencies that set standards and regulations for product safety, environmental compliance, and market access.”

59
Q

Tech (Hardware): 5 Major Trends & Events

A

”* 5G Adoption
* Shift to ARM Architecture
* Sustainability Initiatives
* Rise of Wearable Technology
* Remote Work Enablement”

”* 5G Adoption: Accelerating demand for 5G-enabled devices for faster connectivity and better performance.
* Shift to ARM Architecture: Companies like Apple transitioning to ARM-based chips for improved power efficiency and performance.
* Sustainability Initiatives: Focus on reducing carbon footprint, e-waste, and promoting recycling in hardware production.
* Rise of Wearable Technology: Growth of smartwatches, fitness trackers, and other wearables.
* Remote Work Enablement: Increased demand for laptops, webcams, and other home office technology due to remote work trends.”

60
Q

Tech (Hardware): 5 Forces Shaping the Future

A

”* Artificial Intelligence Integration
* Quantum Computing
* Edge Computing
* Advanced Display Technologies
* Internet of Things (IoT)”

”* Artificial Intelligence Integration: AI in devices for smarter functionality, predictive maintenance, and better user experiences.
* Quantum Computing: Potential to revolutionize processing power, with applications in cryptography and complex problem-solving.
* Edge Computing: Shifting data processing closer to the source to reduce latency and improve performance.
* Advanced Display Technologies: Innovations in OLED, microLED, and foldable screens for next-gen devices.
* Internet of Things (IoT): Expanding connectivity of devices, from home appliances to industrial machinery, driving demand for smarter, connected hardware.”

61
Q

Tech (Hardware): 5 Revenue Drivers

A

”* Device Sales
* Accessories and Peripherals
* Software and Services Integration
* Enterprise Solutions
* Licensing and Royalties”

”* Device Sales: Primary revenue from selling smartphones, laptops, tablets, and other hardware.
* Accessories and Peripherals: Income from products like cases, chargers, and headphones.
* Software and Services Integration: Revenue from bundled software and services with hardware sales.
* Enterprise Solutions: Sales of hardware solutions tailored for business environments, including servers and networking equipment.
* Licensing and Royalties: Income from licensing proprietary technologies and intellectual property to other manufacturers.”

62
Q

Tech (Hardware): 5 Cost Drivers

A

”* Raw Materials and Components
* Manufacturing and Assembly
* R&D and Product Development
* Marketing and Distribution
* Warranty and Support Services”

”* Raw Materials and Components: Costs for procuring essential materials like semiconductors and rare earth metals.
* Manufacturing and Assembly: Expenses associated with producing and assembling hardware products.
* R&D and Product Development: Significant investment in innovation and developing new technologies.
* Marketing and Distribution: Costs related to advertising, channel partnerships, and retail presence.
* Warranty and Support Services: Expenses for providing customer support, repairs, and warranty coverage.”

63
Q

Tech (Hardware): 5 key metrics

A
  • Units Shipped
    • Inventory Turnover Rate
    • Bill of Materials (BOM) Cost Variance
    • Failure Rate / Defect Rate
    • R&D Intensity

  • Units Shipped: Tracks the total number of hardware units shipped to customers and retailers, indicating the scale of production and market demand responsiveness.
    • Inventory Turnover Rate: Measures how efficiently inventory is managed by calculating how quickly products are sold and replaced, crucial for minimizing holding costs and maximizing capital efficiency.
    • Bill of Materials (BOM) Cost Variance: Analyzes the cost differences between expected and actual expenses for hardware components, highlighting areas for cost reduction and supply chain optimization.
    • Failure Rate / Defect Rate: Monitors the percentage of hardware units that fail or have defects post-production, impacting customer satisfaction, warranty costs, and brand reputation.
    • R&D Intensity: Represents the ratio of R&D expenditure to total revenue, assessing the company’s commitment to innovation and the development of cutting-edge hardware technology.
64
Q

Construction: 5 Key Players

A
  • Real Estate Developers
  • General Contractors
  • Subcontractors and Specialized Trades
  • Material Suppliers
  • Regulatory Agencies”

”* Real Estate Developers: Firms that oversee the development of real estate projects, from land acquisition through construction and sales.
* General Contractors: Companies responsible for the day-to-day oversight of a construction site, management of vendors, and coordination of trades.
* Subcontractors and Specialized Trades: Specialists hired by general contractors to perform specific tasks like electrical, plumbing, and carpentry work.
* Material Suppliers: Providers of raw materials, such as cement, steel, and timber, essential for construction projects.
* Regulatory Agencies: Government bodies that enforce building codes, safety standards, and environmental regulations.”

65
Q

Construction: 5 Major Trends & Events

A
  • Green Building and Sustainability
  • Technological Integration (BIM, Drones, etc.)
  • Labor Shortages
  • Urbanization and Smart Cities
  • Regulatory Changes and Safety Standards”

”* Green Building and Sustainability: Growing emphasis on environmentally friendly construction practices and materials.
* Technological Integration: Increased use of Building Information Modeling (BIM), drones, and other tech to improve efficiency and accuracy.
* Labor Shortages: A persistent challenge affecting project timelines and costs, exacerbated by an aging workforce and fewer new entrants.
* Urbanization and Smart Cities: Rising demand for infrastructure and housing solutions in rapidly growing urban areas.
* Regulatory Changes and Safety Standards: Continuous updates to building codes and safety regulations requiring adaptation by industry players.”

66
Q

Construction: 5 Forces Shaping the Future

A
  • 3D Printing and Modular Construction
  • Advanced Building Materials
  • Automation and Robotics
  • Digital Twins
  • Public-Private Partnerships”

”* 3D Printing and Modular Construction: Innovations that promise to reduce construction times and costs while allowing for more complex designs.
* Advanced Building Materials: Development of new materials like self-healing concrete and carbon fiber composites that improve building performance.
* Automation and Robotics: Use of robotics for tasks such as bricklaying and demolition, enhancing efficiency and safety on job sites.
* Digital Twins: Virtual replicas of physical buildings that help in planning, monitoring, and managing construction projects.
* Public-Private Partnerships: Collaborations between government and private sector to fund and build large-scale infrastructure projects.”

67
Q

Construction: 5 Revenue Drivers

A
  • Project Development and Sales
  • Government Contracts and Infrastructure Projects
  • Renovations and Maintenance
  • Design and Consulting Fees
  • Leasing and Property Management Services”

”* Project Development and Sales: Revenue from developing and selling residential, commercial, and industrial properties.
* Government Contracts and Infrastructure Projects: Earnings from public sector projects like roads, bridges, and public buildings.
* Renovations and Maintenance: Income from the repair and upkeep of existing structures, a steady revenue source beyond new builds.
* Design and Consulting Fees: Fees charged for architectural design, engineering consulting, and project management services.
* Leasing and Property Management Services: Revenue from managing and leasing properties on behalf of owners or investors.”

68
Q

Construction: 5 Cost Drivers

A
  • Labor and Workforce Costs
  • Material Costs
  • Equipment and Machinery
  • Permits and Compliance Fees
  • Financing and Interest Expenses”

”* Labor and Workforce Costs: Expenses related to hiring and paying workers, including wages, benefits, and training.
* Material Costs: Fluctuating prices of construction materials like steel, lumber, and concrete, heavily impacting project budgets.
* Equipment and Machinery: Costs for purchasing, leasing, and maintaining construction machinery and tools.
* Permits and Compliance Fees: Fees paid to comply with zoning laws, building codes, and safety regulations.
* Financing and Interest Expenses: Costs of borrowing money to fund construction projects, including interest on loans.”

69
Q

Construction: 5 Key Metrics

A
  • Project Completion Time
  • Cost Overruns
  • Safety Incident Rate
  • Return on Investment (ROI) per Project
  • Energy Efficiency Metrics”

”* Project Completion Time: Time taken to complete a project, influencing profitability and client satisfaction.
* Cost Overruns: Additional expenses that exceed the initial budget, often due to delays, errors, or unforeseen issues.
* Safety Incident Rate: Frequency of accidents and safety violations on construction sites, impacting insurance costs and reputation.
* Return on Investment (ROI) per Project: Measurement of the financial return from a project relative to its cost.
* Energy Efficiency Metrics: Assessment of a building’s energy performance, increasingly important in meeting green standards.”

70
Q

Agribusiness: 5 Key Players

A
  • Input Suppliers
  • Farmers and Growers
  • Food Processors
  • Distributors and Wholesalers
  • Retailers and Exporters”

”* Input Suppliers: Companies providing seeds, fertilizers, pesticides, and farming equipment essential for agricultural production.
* Farmers and Growers: Individuals or enterprises engaged in the cultivation of crops and rearing of livestock.
* Food Processors: Firms that convert raw agricultural products into food products for consumption, adding value along the supply chain.
* Distributors and Wholesalers: Entities involved in the transportation, storage, and sale of agricultural products to retailers or directly to consumers.
* Retailers and Exporters: Businesses that sell agricultural products directly to consumers or export them to international markets.”

71
Q

Agribusiness: 5 Major Trends & Events

A
  • Climate Change Impact
  • Technological Innovations in Farming
  • Shifts in Consumer Preferences
  • Trade Policies and Export Regulations
  • Sustainability and Organic Farming”

”* Climate Change Impact: Adverse weather conditions and changing climates affecting crop yields and livestock production.
* Technological Innovations in Farming: Use of drones, sensors, and AI to enhance productivity and reduce waste in farming operations.
* Shifts in Consumer Preferences: Growing demand for organic, non-GMO, and sustainably sourced products.
* Trade Policies and Export Regulations: Changes in international trade policies impacting export opportunities and market access.
* Sustainability and Organic Farming: Increased focus on sustainable practices, including organic farming and reducing carbon footprints.”

72
Q

Agribusiness: 5 Forces Shaping the Future

A
  • Precision Agriculture
  • Biotech Advancements
  • Digital Marketplaces
  • Alternative Proteins
  • Sustainable Farming Practices”

”* Precision Agriculture: Use of technology to monitor crop health, soil conditions, and optimize resource usage for better yields.
* Biotech Advancements: Development of genetically modified crops and livestock to improve resistance to diseases and environmental stresses.
* Digital Marketplaces: Online platforms connecting farmers directly with consumers, reducing intermediaries and increasing profit margins.
* Alternative Proteins: Growth in plant-based and lab-grown meat alternatives catering to health-conscious and environmentally aware consumers.
* Sustainable Farming Practices: Adoption of techniques that minimize environmental impact, such as crop rotation, reduced tillage, and integrated pest management.”

73
Q

Agribusiness: 5 Revenue Drivers

A
  • Crop and Livestock Sales
  • Export Sales
  • Value-Added Processing
  • Technology Integration
  • Government Subsidies”

”* Crop and Livestock Sales: Revenue generated from the sale of agricultural products, including grains, fruits, vegetables, and meat.
* Export Sales: Income from selling agricultural products to international markets, influenced by global demand and trade agreements.
* Value-Added Processing: Earnings from processing raw agricultural products into finished goods, such as canned vegetables or packaged meats.
* Technology Integration: Revenue from implementing farming technologies that improve efficiency and productivity, like automated equipment or data analytics tools.
* Government Subsidies: Financial support from government programs aimed at stabilizing farm income and encouraging sustainable practices.”

74
Q

Agribusiness: 5 Cost Drivers

A
  • Input Costs
  • Labor
  • Logistics
  • Technology Investments
  • Regulatory Compliance”

”* Input Costs: Expenses for seeds, fertilizers, pesticides, and other materials necessary for crop and livestock production.
* Labor: Costs associated with hiring farm workers, including wages, benefits, and training.
* Logistics: Transportation and storage costs for moving products from farms to processors, retailers, or export markets.
* Technology Investments: Spending on new farming technologies, machinery, and equipment to enhance productivity.
* Regulatory Compliance: Costs related to meeting health, safety, and environmental regulations in agricultural operations.”

75
Q

Agribusiness: 5 Key Metrics

A
  • Yield per Acre
  • Cost of Production per Unit
  • Market Share by Crop Type
  • Export Volume
  • Environmental Impact (Carbon Footprint)”

  • Yield per Acre: A measure of how much crop is produced per acre, indicating productivity and efficiency of farming practices.
  • Cost of Production per Unit: The total cost involved in producing a unit of crop or livestock, reflecting operational efficiency.
  • Market Share by Crop Type: The proportion of market sales dominated by specific crops, used to assess competitive position.
  • Export Volume: The quantity of agricultural products sold internationally, critical for assessing global market penetration.
  • Environmental Impact (Carbon Footprint): Measurement of greenhouse gas emissions from farming activities, used to gauge sustainability efforts.”
76
Q

Tech Software/SaaS: 5 Key Players

A

”* Cloud Service Providers
* Developers and Software Engineers
* System Integrators
* Consulting Firms
* Regulatory and Compliance Entities”

”* Cloud Service Providers: Companies that offer infrastructure, platform, and software services via the cloud, enabling software deployment and scalability.
* Developers and Software Engineers: Individuals or teams responsible for creating, coding, and maintaining software products and services.
* System Integrators: Organizations that specialize in bringing together various software solutions into a cohesive system for businesses.
* Consulting Firms: Provide expertise in software implementation, customization, and optimization for business needs.
* Regulatory and Compliance Entities: Bodies that oversee software compliance with data privacy laws, industry standards, and cybersecurity protocols.”

77
Q

Tech Software/SaaS: 5 Major Trends & Events

A

”* Cloud Migration
* AI and Machine Learning
* Subscription-Based Models
* Cybersecurity Focus
* Remote Collaboration Tools”

”* Cloud Migration: Shift from on-premises software to cloud-based solutions for scalability and flexibility.
* AI and Machine Learning: Integrating AI into software for predictive analytics, automation, and enhanced user experiences.
* Subscription-Based Models: Transition from perpetual licenses to recurring revenue through subscriptions.
* Cybersecurity Focus: Growing need for secure software solutions to protect against cyber threats.
* Remote Collaboration Tools: Increased use of tools like Slack, Teams, and Zoom to facilitate remote work.”

78
Q

Tech Software/SaaS: 5 Forces Shaping the Future

A

”* Hyperautomation
* Low-Code/No-Code Platforms
* Data Privacy Regulations
* Edge and Serverless Computing
* Integration of Blockchain”

”* Hyperautomation: Automating as many business processes as possible using AI, RPA, and other technologies.
* Low-Code/No-Code Platforms: Democratizing software development, enabling non-technical users to build applications.
* Data Privacy Regulations: Impact of GDPR, CCPA, and other regulations on software design and data handling.
* Edge and Serverless Computing: Reducing latency and improving scalability by processing data closer to the user.
* Integration of Blockchain: Leveraging blockchain for secure transactions, data integrity, and decentralized applications.”

79
Q

Tech Software/SaaS: 5 Revenue Drivers

A

”* Subscription Fees
* Professional Services
* Usage-Based Pricing
* Advertising and Data Monetization
* Partner and Channel Sales”

”* Subscription Fees: Recurring revenue from users subscribing to software services.
* Professional Services: Income from consulting, implementation, and training services.
* Usage-Based Pricing: Revenue tied to the extent of service usage, common in cloud services.
* Advertising and Data Monetization: Earnings from ads and monetizing user data.
* Partner and Channel Sales: Revenue through partnerships, integrations, and channel sales.”

80
Q

Tech Software/SaaS: 5 Cost Drivers

A

”* Cloud Infrastructure
* R&D and Product Development
* Customer Acquisition and Retention
* Security and Compliance
* Support and Maintenance”

”* Cloud Infrastructure: Costs for hosting, data storage, and bandwidth on cloud platforms.
* R&D and Product Development: Investment in developing and enhancing software features.
* Customer Acquisition and Retention: Expenses for marketing, sales, and customer success initiatives.
* Security and Compliance: Costs associated with ensuring data security and meeting regulatory requirements.
* Support and Maintenance: Ongoing costs for providing customer support and software updates.”

81
Q

Tech Software/SaaS: 5 Key Metrics

A

”* Monthly Recurring Revenue (MRR)
* Customer Lifetime Value (CLV)
* Churn Rate
* Net Promoter Score (NPS)
* Average Contract Value (ACV)”

”* Monthly Recurring Revenue (MRR): Measures the predictable, recurring revenue component from subscriptions.
* Customer Lifetime Value (CLV): The total revenue expected from a customer over their engagement period.
* Churn Rate: The rate at which customers cancel subscriptions, impacting growth potential.
* Net Promoter Score (NPS): A measure of customer satisfaction and likelihood to recommend the service.
* Average Contract Value (ACV): Average value of a customer’s contract, indicating the size of deals being closed.”

82
Q

Social Platforms: 5 Key Players

A

”* Content Creators and Influencers
* Advertisers and Marketers
* Platform Developers
* Regulatory Bodies
* Data Analytics and Insights Providers”

”* Content Creators and Influencers: Individuals and entities that generate content, driving user engagement and traffic on platforms.
* Advertisers and Marketers: Brands and businesses that utilize social platforms for advertising, key to revenue generation.
* Platform Developers: Teams responsible for the technical aspects of platform maintenance, updates, and new feature rollouts.
* Regulatory Bodies: Government and independent organizations that oversee compliance with data protection, privacy laws, and advertising standards.
* Data Analytics and Insights Providers: Companies offering analytics services that help platforms and advertisers understand user behavior and trends.”

83
Q

Social Platforms: 5 Major Trends & Events

A

”* Rise of Short-Form Content
* Increased Focus on Privacy
* Monetization Tools for Creators
* Algorithmic Changes
* Social Commerce Integration”

”* Rise of Short-Form Content: Increasing popularity of short videos and stories, influencing content strategies across platforms.
* Increased Focus on Privacy: Growing user demand for privacy leading to stricter data handling practices and transparency.
* Monetization Tools for Creators: Expansion of features that allow creators to monetize their content directly through the platform.
* Algorithmic Changes: Continuous updates to platform algorithms affecting content visibility, user engagement, and advertising effectiveness.
* Social Commerce Integration: Blurring lines between social media and e-commerce, with in-app shopping features becoming more common.”

84
Q

Social Platforms: 5 Forces Shaping the Future

A

”* Artificial Intelligence in Content Moderation
* Virtual Reality and Metaverse Development
* Evolving Privacy Regulations
* Blockchain for Data Security
* Cross-Platform Integration”

”* Artificial Intelligence in Content Moderation: Use of AI to detect and manage inappropriate content, improving platform safety and user experience.
* Virtual Reality and Metaverse Development: Efforts to create immersive experiences and virtual worlds within social platforms.
* Evolving Privacy Regulations: Changes in data privacy laws globally, affecting how platforms collect, store, and use user data.
* Blockchain for Data Security: Exploring blockchain solutions to enhance data security and provide users more control over their data.
* Cross-Platform Integration: Increasing connectivity and integration among different social platforms, enhancing user experience.”

85
Q

Social Platforms: 5 Revenue Drivers

A

”* Advertising Revenue
* Subscription Services
* In-App Purchases
* Data Licensing and Monetization
* Brand Partnerships and Sponsorships”

”* Advertising Revenue: Main source of income through targeted ads, sponsored content, and brand deals.
* Subscription Services: Offering premium features, ad-free experiences, or exclusive content through subscription models.
* In-App Purchases: Revenue from users buying digital goods, such as filters, virtual gifts, or game-related purchases.
* Data Licensing and Monetization: Selling anonymized user data insights to third parties for market research and targeted advertising.
* Brand Partnerships and Sponsorships: Collaborations with brands for influencer marketing, sponsored posts, and content creation partnerships.”

86
Q

Social Platforms: 5 Cost Drivers

A

”* Content Moderation and Compliance
* Technology Infrastructure
* Marketing and User Acquisition
* Regulatory Compliance
* Research and Development”

”* Content Moderation and Compliance: Costs associated with ensuring platform content adheres to community guidelines and legal standards.
* Technology Infrastructure: Expenses for servers, bandwidth, and software development to maintain platform stability and performance.
* Marketing and User Acquisition: Spending on advertising and promotions to attract and retain users.
* Regulatory Compliance: Costs for adhering to privacy laws, data security regulations, and other legal requirements.
* Research and Development: Investment in new features, platform enhancements, and emerging technologies like AI and VR.”

87
Q

Social Platforms: 5 Key Metrics

A

”* Daily Active Users (DAU)
* Engagement Rate
* Ad Click-Through Rate (CTR)
* Average Revenue Per User (ARPU)
* User Retention Rate”

”* Daily Active Users (DAU): Number of users who engage with the platform on a daily basis, indicating overall platform activity.
* Engagement Rate: Measures how actively users interact with content, through likes, shares, comments, and other forms of engagement.
* Ad Click-Through Rate (CTR): Percentage of users who click on an advertisement after seeing it, indicating ad effectiveness.
* Average Revenue Per User (ARPU): Average income generated from each user, showing how well the platform is monetizing its user base.
* User Retention Rate: Percentage of users who continue to use the platform over time, reflecting the platform’s ability to retain its audience.”

88
Q

Tech Online: 5 Key Players

A

”* Content Creators and Publishers
* Advertisers and Ad Networks
* Cloud and Data Center Providers
* Internet Service Providers (ISPs)
* Regulatory and Oversight Agencies”

”* Content Creators and Publishers: Individuals and companies that produce digital content, driving traffic and engagement on online platforms.
* Advertisers and Ad Networks: Entities that buy and sell advertising space, critical for revenue generation on online platforms.
* Cloud and Data Center Providers: Offer the infrastructure needed to store, manage, and process the vast amounts of data generated by online activities.
* Internet Service Providers (ISPs): Provide the connectivity needed for online services and content delivery.
* Regulatory and Oversight Agencies: Government bodies that regulate internet usage, data privacy, and digital content standards.”

89
Q

Tech Online: 5 Major Trends & Events

A

”* Cloud Computing Expansion
* AI and Big Data
* Rise of Streaming Services
* E-commerce Boom
* Data Privacy Concerns”

”* Cloud Computing Expansion: Rapid growth in cloud adoption across businesses of all sizes for storage, processing, and analytics.
* AI and Big Data: Increasing use of AI and big data analytics to drive insights, automation, and personalization.
* Rise of Streaming Services: Growth in demand for digital content, with services like Netflix and YouTube leading the way.
* E-commerce Boom: Surge in online shopping, driven by convenience and extensive product availability.
* Data Privacy Concerns: Heightened awareness and regulation around data protection, impacting how companies collect and use data.”

90
Q

Tech Online: 5 Forces Shaping the Future

A

”* Quantum Computing
* Edge Computing
* Enhanced AI and Machine Learning
* Sustainability in Cloud Services
* Regulatory Landscape Changes”

”* Quantum Computing: Promises to revolutionize problem-solving and data processing capabilities.
* Edge Computing: Moves data processing closer to the source, reducing latency and enhancing real-time analytics.
* Enhanced AI and Machine Learning: Continuous advancements in AI improving service delivery and personalization.
* Sustainability in Cloud Services: Focus on reducing the carbon footprint of data centers and cloud operations.
* Regulatory Landscape Changes: Evolving global regulations on data privacy and digital operations, affecting business strategies.”

91
Q

Tech Online: 5 Revenue Drivers

A
  • Advertising Revenue
  • Cloud Services
  • Subscription Services
  • E-commerce Sales
  • Data Monetization

”* Advertising Revenue: Income from digital ads, a major driver for companies like Google and Facebook.
* Cloud Services: Earnings from cloud computing and storage services offered to businesses and developers.
* Subscription Services: Revenue from paid subscriptions for premium content, software, or services.
* E-commerce Sales: Sales of goods through online platforms, including marketplace fees and commissions.
* Data Monetization: Revenue from leveraging data for targeted ads, insights, and analytics services.”

92
Q

Tech Online: 5 Cost Drivers

A

”* Data Center Operations
* Content Acquisition
* R&D and Platform Development
* Marketing and User Acquisition
* Regulatory Compliance”

”* Data Center Operations: Costs associated with maintaining and expanding data center infrastructure.
* Content Acquisition: Expenses for licensing or producing digital content, significant for streaming platforms.
* R&D and Platform Development: Investment in technology development and platform enhancements.
* Marketing and User Acquisition: Spending on attracting new users and retaining existing ones through various channels.
* Regulatory Compliance: Costs of adhering to data privacy laws, digital advertising regulations, and platform standards.”

93
Q

Tech Online: 5 Key Metrics

A

”* Monthly Active Users (MAU)
* Bounce Rate
* Conversion Rate
* Cost Per Acquisition (CPA)
* Average Session Duration”

”* Monthly Active Users (MAU): Measures the number of unique users engaging with a platform within a month, reflecting user base size.
* Bounce Rate: The percentage of visitors who navigate away after viewing only one page, indicating the effectiveness of content or user experience.
* Conversion Rate: Percentage of users who take a desired action, such as making a purchase or signing up for a service.
* Cost Per Acquisition (CPA): The average cost of acquiring a new customer, used to assess the efficiency of marketing efforts.
* Average Session Duration: The average time users spend on the platform during a visit, indicating user engagement.”

McKinsey Prep (10 decks)

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