tech strategy

Question 1

Trade offs:

kindle app on kindle device vs all device

Answer 1

Qualitative:pros/cons:
Quantitative: 
cost benefit/revenue analysis, 
profitability, 
ROI, 
or breakeven quantity analysis

Question 2

Trade offs:

display ads on amazon site

Answer 2

Qualitative:pros/cons:
Quantitative: 
cost benefit/revenue analysis, 
profitability, 
ROI, 
or breakeven quantity analysis

Question 3

NGE: new geography entry and
NIE: new industry entry
Expedia train tickets
How should Expedia launch into new category/business of train tickets?

Answer 3

Market/customer behavior: first pick a country which has a large Customer train demand

Company leverageable competency (synergy): already present in country; can use existing travel options like plane/hotels to create a travel experience.

Competitor landscape: fragmented/weak vs organized

Customer use cases/needs: holiday vs regular, deals,

Ease of Operations: regulatory friendliness, supplier power(train operators), labor,

Marketing strategy (customer acquisition strategy and costs, partnerships, advertising)

Question 4

NGE: new geography entry
How would you determine whether to launch your product as is in the new geography vs waiting to launch product until it is more customized to the market?

Answer 4

Do a gap analysis.
Gap analysis compares current state vs desired, expected state. It identifies gaps in our service.

Eg: no point launching in a country if we don’t have payment system used by country’s customers set up.

How to do gap analysis:
Identify areas to explore
Establish ideal/target state
Assess current state
Compare target to current state
Identify gaps and causes of this gaps (RCA)

Frameworks for gap analysis: McKinsey 7s framework, Fishbone diagram
https://www.smartsheet.com/gap-analysis-method-examples

Question 5

NGE: new geography entry

Should we not enter a market if there is a big established competitor?

Answer 5

Profitability and ROI: Do 5-10 year income statement projection of revenue and costs (FC,VC, opportunity cost) and decide if it is profitable to enter despite competitors.
First mover advantage is important.
“Market size”: if it’s a large market (China/india) then it may not be smart to abandon market just bcoz of large competitor

Question 6

Brand: use existing brand name or start a new brand name?
Should we use windows brand on new Microsoft smart watch?
Should x company market its new frozen yogurt under existing brand name or start new brand name?

Answer 6

Criteria: AFF -awareness, favorability, fit/focus
Brand awareness: % ppl who know it in target market?
Brand favorability: positive, negative or neutral opinion of brand?
Brand fit or focus: does it logically fit/make sense or does it confuse customer?
Eg: see RATN chapter 6 for detailed examples

Question 7

NIE: new industry analysis (quantitative analysis)

Should Nike sell dress shoes in US? Do a quantitative analysis, not a qualitative analysis?

Answer 7

users

Breakeven analysis done (how many units to be profitable and can the company sell that many?)
Step 0: segment customers and do below for each segment
Step 1: “estimating revenue = #usersquantityprice” for each segment
Step 2: ask interviewer for costs: FC and VC for each segment
Step 3: use “breakeven quantity = FC/(price - VC)” to calculate breakeven q for each segment
Step 4: use “market share = breakeven q/total quantity” to calculate MS that needs to be captured to breakeven.

Create a table with each of the following coloums: (remember
Market sizing = #usersquantityprice)

Type of customer: Segment customers (no, office use only, fashionable, prestige)
% of customers in this segment
total #customers in this segment

Then, quantity of dress shoes that will be purchased by segment
Then total quantity of shoes in each segment

Price
Price per shoe by segment
Total revenue

Breakeven quantity?
Ask for table of Costs: FC and VC for each segment
Then use breakeven q = FC/CM to calculate breakeven q for each segment

Market share needed to capture?
(Breakeven q/total quantity of shoes) will give us market share needed to capture by segment

Initial recommendation?
You can end here by estimating if the company is likely to capture that % market share based on company leverageable competency.

Further analysis:
Ask Growth rate by segment
Ask competition by segment

Final recommendation:
Based on market share required, growth rate and competition in each segment, make a recommendation on which segment to enter.