SWOT Analysis for Sprint/Nextel - 2007


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A SWOT Analysis for Sprint/Nextel created during a graduate class in Integrated Marketing Communication.

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SWOT Analysis for Sprint/Nextel - 2007

  1. 1. Customization Technology Innovation Mini Project 2 … S.W.O.T. Analysis
  2. 2. The Current Situation <ul><ul><li>Struggling to absorb the 17.8 million customers it added due to the merger in 2005 </li></ul></ul><ul><ul><li>Sprint spreading itself thin financially </li></ul></ul><ul><ul><li>A plan to attract unwanted customers with poor credit ratings drove up company turnover </li></ul></ul><ul><ul><li>Reliance on technology driving company expectations </li></ul></ul><ul><ul><li>Major difficulties merging its network with Nextel’s </li></ul></ul><ul><ul><li>$8 Billion allocated to implementing WiMax technology </li></ul></ul><ul><ul><li>“ Power Up” </li></ul></ul>
  3. 3. Strengths <ul><ul><li>Technology & Innovation </li></ul></ul><ul><ul><ul><li>Through the industries eyes they are the brand leader </li></ul></ul></ul><ul><ul><li>Product Performance </li></ul></ul><ul><ul><ul><li>Excel in music downloading, streaming video technology, and speed of wireless networks </li></ul></ul></ul><ul><ul><li>Niche Marketing </li></ul></ul><ul><ul><ul><li>Exclusive walkie-talkie features </li></ul></ul></ul><ul><ul><ul><li>Patented ruggedness and look </li></ul></ul></ul><ul><ul><li>B2B Customer Satisfaction </li></ul></ul><ul><ul><ul><li>Award winning due to customization and advanced technology </li></ul></ul></ul>… internal
  4. 4. Weaknesses <ul><li>Integrating the Two Companies </li></ul><ul><ul><li>Added 708,000 subscribers last quarter, far below estimates </li></ul></ul><ul><ul><li>Arduous process requiring exceeding expected costs </li></ul></ul><ul><li>Shareholder’s Equity </li></ul><ul><ul><li>Net income last year was $1.8 million, but their stock has slid 32.3% since April 2005 </li></ul></ul><ul><ul><li>No guaranteed ROI creates risk </li></ul></ul><ul><li>Lack of Branding </li></ul><ul><ul><li>Research points to lack of brand identity </li></ul></ul><ul><ul><li>Brand loyalty solely based on technology </li></ul></ul><ul><li>B2C Satisfaction </li></ul><ul><ul><li>65.1% in customer satisfaction, lowest in industry (JD Power & Associates) </li></ul></ul>
  5. 5. Opportunities <ul><li>Demand & Desire for Technology </li></ul><ul><ul><li>Consumers that use… text messaging (35%), picture taking (28%), and games (22 %) </li></ul></ul><ul><ul><li>Maps and driving directions desired by 47% of consumers </li></ul></ul><ul><li>Land Line Phones a Thing of the Past </li></ul><ul><ul><li>The perception is low sophistication of current phones </li></ul></ul><ul><li>Inter-Cellular Advertising </li></ul><ul><ul><li>Two years ago: six-week mobile ad spot was $25,000 and now the average spot costs $200,000 </li></ul></ul><ul><ul><li>New industry demands research before ROI potential is realized </li></ul></ul><ul><ul><li>Poised for dramatic growth </li></ul></ul>… external
  6. 6. Threats <ul><ul><li>Emergence of Competing Technologies </li></ul></ul><ul><ul><ul><li>Voice Over IP Technology: Skype and Vonage </li></ul></ul></ul><ul><ul><li>Breaking Regulatory Conditions </li></ul></ul><ul><ul><ul><li>A Judge in Illinois ruled that company must sell off Nextel operations in Illinois, Michigan, Iowa and Nebraska because of a prior agreement not to compete with a Sprint affiliate, iPCS </li></ul></ul></ul><ul><ul><ul><li>Financial and political repercussions </li></ul></ul></ul><ul><ul><li>Liabilities of Outside Partnerships </li></ul></ul><ul><ul><ul><li>Heavy reliance on partner companies </li></ul></ul></ul><ul><ul><ul><ul><li>Intel, ESPN, General Dynamics, Motorola, HP, Microsoft </li></ul></ul></ul></ul>
  7. 7. Prioritization Strategy
  8. 8. Creating Brand Image <ul><li>Developing an Identity </li></ul><ul><ul><li>Market your strengths </li></ul></ul><ul><ul><ul><li>Sprint features exceed their competitors but sales are lower </li></ul></ul></ul><ul><ul><ul><ul><li>Music system & camera quality </li></ul></ul></ul></ul><ul><ul><ul><li>Ad Campaigns need more direction </li></ul></ul></ul><ul><ul><li>Sprint is not a sought after name </li></ul></ul><ul><ul><ul><li>Give consumers more than just technology </li></ul></ul></ul><ul><ul><ul><li>Conjure up a specific image closer to society </li></ul></ul></ul><ul><ul><li>Establish brand loyalty </li></ul></ul><ul><ul><ul><li>Cut down on pre-paid customers </li></ul></ul></ul><ul><ul><ul><li>Get back the Nextel loyalists (among the best prior to merger) </li></ul></ul></ul><ul><ul><ul><li>Regain swagger and take back market share </li></ul></ul></ul>
  9. 9. Grasping Popular Demand <ul><li>Adherence to Demand </li></ul><ul><ul><li>Customers want what we already have </li></ul></ul><ul><ul><ul><li>T ext messaging (35%), picture taking (28%), games (22 %), maps and driving directions (47%) </li></ul></ul></ul><ul><ul><li>Fierce competition calls for differentiation </li></ul></ul><ul><ul><ul><li>Revenue no longer coming from plans </li></ul></ul></ul><ul><ul><ul><ul><li>Messaging and ringer downloads have the highest profitability </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Video Games set to overtake in the upcoming years </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Accounting for an average of $40 more per bill </li></ul></ul></ul></ul><ul><ul><li>Fickle consumer market </li></ul></ul><ul><ul><ul><li>If we fail to grasp it consider them gone </li></ul></ul></ul>
  10. 10. Conclusion <ul><li>The SWOT analysis calls for a restructuring in company objectives </li></ul><ul><li>Technology is weakened by a poor marketing campaign </li></ul><ul><li>Our IMC plan calls for the creation of a current non-existent brand image and tightening Sprint Nextel’s grip on popular demand </li></ul><ul><li>The resources are in place and the desire exists </li></ul><ul><li>If the strategy is adopted Sprint Nextel can locate a competitive edge beyond innovation </li></ul>..Questions ?