iRobot designs and builds robots for both consumer and government/industrial use. For consumers, they have sold over 5 million floor vacuuming and cleaning robots worldwide, which account for 55% of total revenue. Their government contracts include small ground robots and unmanned vehicles used by the US military, making up 46% of revenue. To promote their consumer products, iRobot uses social media and educational programs to build their brand, while government products are promoted directly to the US military. Moving forward, iRobot aims to continue innovating new consumer products to create "blue oceans" and lead the market, while also relying on government contracts for research funding.

1. DO YOU?
YUNUS EMRE SARIGÜL
iRobot: Finding the Right
Market Mix?

2. »Corporate Profile
» iRobot designs and builds robots that make a difference.
iRobot was founded in 1990 by Massachusetts Institute of
Technology robotics with the vision of making practical robots a
reality.
» iRobot is among the first companies to introduce robotic
technology into the consumer market. Home care robots have
been its most successful products, with over 5 million units sold
worldwide and accounting for over half of its total annual
revenue.
» The company offers consumer products, such as floor vacuuming
robots, floor washing robots, pool cleaning robots,.

3. » iRobot also has long-term contractual agreement with U.S.
government to produce military robots.
» Its government and industrial products include the 510 PackBot
small, unmanned ground robots; and the 310 small unmanned
ground vehicle (SUGV) and 320 SUGV multi-purpose ground robots
that perform in battlefield and bomb disposal.
» The company also provides 1Ka Seaglider, an underwater vehicle
designed for oceanic missions to measure temperature, salinity,
depth-averaged current, and other data for scientific and military
planners.
» It sells its robots through chain stores and other national retailers, as
well as through on-line stores like Amazon ,Wall-mart and the U.S.
Military.

6. ROBOTS THAT MAKE A DIFFERENCE

9.  Home Care Robots:
˃Cleaning: homes, pools, gutters
˃5 million sold worldwide
˃30 national retailers; international retailers
˃55% of revenues
 Government and Industrial Robots:
˃Ground and maritime unmanned vehicles
˃Divisions of U.S. military
˃46% of revenues
46%
55%
4%
Revenues
Government
Contracts
Home Robots
Other
REVENUES

10. R&D

13. EVEN THE CATS CAN USE IT!

18. • iRobot’s promotion strategies are varied by product
group.
• BUT they don’t use TV or radio advertising for none of
their products.
• Defense products are only for U.S. government so
promotion is not necessary.
• For consumer market they use social media to
promote support services and brand recognition.

19. • Another branding strategy is education.
• They recognized that fewer American children go to
science, technology, engineering, math areas.

20. • They launched Starter Programs for the Advancement
of Robotics Knowledge to increase the interest for
science and technology among the students from
elementary school to university.

21. • Also they started annual National Robotics Week
program to educate public about the impact of
robotics in society.

22. SWOT Analysis
Strengths
• Core competencies:
design, develop, market robots
•Innovative thanks to large R&D budget
• Existing alliances
• Healthy financial positioning
• Government contracts
•Intellectual property
Weaknesses
• Limited visibility
• Patents expiring in 2019
• Dependent on 3rd party
suppliers, manufacturers
• Government dependency (contracts, R&D
funding)
• Sensitive to economic climate (recession
in 2008 to 3rd Q 2009
Opportunities
• Expand marketing efforts
• Entry into new markets
• Product expansion
• Lower-tiered / priced goods
• International presence
Threats
• Competitors have more money and
knowledge in consumer space
• Product substitution (from blue ocean to
red ocean)
• Reduced government spending
• Break-up / non-renewing alliances
• Employees leaving

23.  The long-term success in the consumer market would require
iRobot to develop more “blue oceans.”?
 Did it make sense for iRobot to continue to develop new
consumer products or would it be better off focusing on the
military and aerospace marketplace?

24.  They should continue to produce both for consumer
and military sector, because they get most of the R&D
resource from government.
 They need to be innovative so that they could create
blue oceans to lead consumer market with
new, improved, innovative and differenciated products.