Cookpad strategy final

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Cookpad strategy final

  1. 1. Business Strategy I “COOKPAD” 1
  2. 2. •Japan’s largest recipe site that lets upload and search original or selfcreated recipes. • Listed company which went public on the Tokyo Exchange Market (07/2009) •Which recipe site do you use most frequently?” -80% of users answered “COOKPAD” Source: Survey from Nikkei Research Institute of Industry and Regional Economy 2 Mission: “Make everyday cooking fun”
  3. 3. Strategic Model of COOKPAD 20 million registered users Broad Low- Cost Strategy (as of 07/2012) 1,2 million registered recipes Broad Differentiation Strategy Narrow Low Cost Strategy Narrow Differentiation Strategy 3
  4. 4. Business Model Quality of Service Variety of Offers COOKPAD Advanced Technologies 4 Social Networking System
  5. 5. 13,88 Million PC Users 17,02 Million Mobile users Net Sales Operating Income 1,875 Net Income 5 3,544 1,151 FY2012 Q3 (9 months) 32% Income/Sales
  6. 6. Highest sales in the company’s history 775 727 542 (¥ million) 558 583 638 681 480 413 452 420 390 485 303 Q1 2011 6 Q2 Q3 Advertising Q4 Q1 2012 Q2 Q3 Premium Services Source: Cookpad reports FY2012
  7. 7. General External Environment Political Environment Economic Environment Abenomics Depreciation of the yen Social Environment SNS is spreading Web search became common Women’s social participation (Sharing house works with men) Safety and health conscious of food Technological Environment Share of Smartphone is increasing Supply chain management Demographic Environment Aging society Baby boomers is retiring Specific International Events 7 Corporate tax is high in Japan Depreciation of the yen
  8. 8. Five force analysis Threat of new entrants Capital investment is low Simple business model Number of membership and recipes is overwhelming Supplier power Switching cost high Many IT service providers Number of membership and recipes is overwhelming High awareness and satisfaction of Web site Other recipe site weak Segment Rivalry sl.weak Books Magazines TV restaurant industry 8 neutral sl.weak Threat of substitutes Buyer power Advertiser User Switching cost is low No comparable competitor Oligopoly weak
  9. 9. VRIO Framework Value First Move : High Brand & Advantage Customer Awareness / Preference Customer Satisfaction / Beyond Customers' Expectation Large Number of Recipes Simplicity / Usability Rarity : High Internet Technology Short Click Response Time Accuracy of Search Function Big Data Analysis Ruby / Open Source Web Application Framework Imitability : Medium Organization : Medium Business Model Structure & Control Mechanism Easy to imitate the Business Model Need Time, Capital, and Technology to catch up 9 Strong Leadership of Founder In-house Technology Development Homogeneous Background of Management Team
  10. 10. Evaluation of Cookpad's Current Strategy  Cookpad's diffentiated service creates customers preference.  Customer preference allows Cookpad to make above normal profits  Cookpad's diffentiated service generates competitive advantage.  Cookpad's service differentiation strategy is well implemented through the organizational structure and control. VRIO criteria verifies Cookpad's service differentiation strategy. 10
  11. 11. SWOT Analysis High awareness and satisfaction of Web site Number of membership and recipes is overwhelming Market leader position Technological excellence (short response time, etc) Simplicity Less diversification in business Too much reliance on the founder/top management Rapid expansion/Recruit of good engineers/Burden of investment for the future Increase of paying members Other potential segments Alliance with Facebook Globalization/Overseas market Many potential customers (men, young age) Women’s social participation/Sharing housework with men Safety and health consciousness of food Simple business model Service obsolescence Relatively low entrance barrier (Simple business model, less capital intensive) Possible entrants 11
  12. 12. Analysis of Cookpad strategy • A platform business based on FOOD Premium services Want more information! Customer experiences -Tons of Food recipes- Want effective ways! Advertising Platform Want to know customers’ needs! Marketing support Stable and growing market 12
  13. 13. Strategic alternative • Two options for alternatives Growth in overseas Time to expand their business! A risk of saturated paid users among low diversification 13 Globalization Go global with current business Synergy globally Current business in Japan Synergy with other businesses and targets in Japan Diversification
  14. 14. Strategic alternative Mission statement Make everyday cooking fun Globalization Important resource 14 Should choose people who have • high community sense in SNS • high sympathy to Japanese food Customer value is a country which has • the highest usage of SNS about Japanese foods • the highest number of people who like Japanese foods the best JETRO report 2012
  15. 15. Strategic alternative Mission statement Make everyday cooking fun Diversification Should aim • To target new segments (age and men) • Service expansion 15
  16. 16. Sales Forecast (5-year) 9,000 8,000 7,000 6,000 Diversification 5,000 Globalization 4,000 Premium Services Advertising 3,000 2,000 1,000 2012 2013 2014 2015 2016 2017 2018 5-year forecast Assumptions 1. Adverting business will steadily grow at 5% 2. Premium service market will be saturated and slow down 3. Capture 1% of Korean people (age 25-35) and grow at 20% 4. Sell 1,000-yen book to 10% of premium members 16
  17. 17. Strategic Model of COOKPAD 20 million registered users Broad Low- Cost Strategy (as of 07/2012) 1,2 million registered recipes New Strategy Broad Differentiation Strategy Narrow Low Cost Strategy Narrow Differentiation Strategy 17
  18. 18. Backup 18
  19. 19. Value Chain Analysis Firm Infrastructure Support Activities Human Resource Management Technology Development Procurement After Outbound Inbound sales logistics logistics service Operations Marketing/ ManufacSales turing 19 Margin
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