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: BEYOND DVR


                Benoit Jasmin
                Yiwen Stratton
                Steve Toerner
Unitas (Group   ...
Agenda
    Overview



    Background



    Alternatives



    Recommendations


        Target Markets
    

     ...
Background: SWOT Analysis
    Strengths


     Software Development
     Intellectual Property
     Cable/ Satellite D...
Core Competence

    Cutting-edge software technology and

    innovative research and development
Alternatives
    Maintain current operations



    Emphasize direct consumer electronic sales



    Expand into intern...
Recommendations: 2 Year
Horizon
    Drop stand-alone DVR sales





    Focus on mass distribution of software





    ...
Target Customers

    Multiple Service Organizations (MSO)




    Networks & Advertisers

MSOs: Market Share

                   Comcast
Other
                    22%
33%

                               Time-Warn...
MSOs: Target Customers
TiVo-client   35%
Target        17%
Other         48%                           Comcast
           ...
Value Proposition: MSOs
    Provide customers with highest rated User


    Interface (UI)

    Reduce customer churn


...
Rationale: Mass Distribution
    No subscriber acquisition costs (SAC)




    Take advantage of massive existing


    ...
Marketing Strategy: Mass
Distribution
     Cross-functional team with sales and R&D to
 
     develop product packages (c...
Advertising and Audience
Research
    Targets: Network & Advertisers


    Prime Prospects: Current Clients


     Best...
Value Proposition: Network &
Advertisers
     Provide more advanced and interactive ads
 
        Provide   alternate me...
Rationale: DVR-based
Advertising
    Low competition




    Minimal capital investment required




    High margin pot...
Marketing Strategy: Advertising
    Increase ad-sales staff (begin in month

    1)

    Promote TiVo-based advertising p...
Rationale: Audience Research
    Strong brand recognition lends credibility to


    audience research capabilities
    H...
Marketing Strategy: Audience
Research
     Create cross-functional teams with advertising staff
 
     to standardize rep...
Pricing Strategy
    Subscription Pricing


            Service Charge: $13 – 16 per month for
     MSO
      consumer
 ...
2008 Forecasted Income
 Statement
  Projection     Worst Case      Most Likely    Best Case
PROJ.
REVENUES
  TiVo Service ...
2009 Forecasted Income
 Statement
  Projection     Worst Case      Most Likely    Best Case
PROJ.
REVENUES
  TiVo Service ...
Review
    Continue service of current TiVo subscribers


    Halt production of TiVo stand-alone DVRs


    Focus on de...
Long-Term Horizon
    Initiate mass distribution partnerships with


    satellite and small cable distributors

    Inve...
Questions?




        Thank You!
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Tivo: Beyond DVR

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UC MBA, MKTG 711

Published in: Business, Technology

Tivo: Beyond DVR

  1. 1. : BEYOND DVR Benoit Jasmin Yiwen Stratton Steve Toerner Unitas (Group Jim Wolff
  2. 2. Agenda Overview  Background  Alternatives  Recommendations  Target Markets  Marketing Strategies  Financials  Review 
  3. 3. Background: SWOT Analysis Strengths   Software Development  Intellectual Property  Cable/ Satellite Distribution Weaknesses   Consumer Electronics Opportunities   Audience Research  Advertising Solutions  International Business Threats   MSOs can provide DVR equipment at cheaper prices
  4. 4. Core Competence Cutting-edge software technology and  innovative research and development
  5. 5. Alternatives Maintain current operations  Emphasize direct consumer electronic sales  Expand into international markets  Focus on mass distribution of software  Develop audience research & measurement  Promote DVR-based advertising  Redirect budgeted R&D money to marketing 
  6. 6. Recommendations: 2 Year Horizon Drop stand-alone DVR sales  Focus on mass distribution of software  Develop audience research & measurement  (ARM) Promote DVR-based advertising 
  7. 7. Target Customers Multiple Service Organizations (MSO)  Networks & Advertisers 
  8. 8. MSOs: Market Share Comcast Other 22% 33% Time-Warner 12% Cox DirecTV 6% Charter 15% TiVo 5% 4% Cablevision 3%
  9. 9. MSOs: Target Customers TiVo-client 35% Target 17% Other 48% Comcast Other 22% 33% Time-Warner 12% DirecTV 15% TiVo Cox 4% 6% Charter Cablevision 5% 3%
  10. 10. Value Proposition: MSOs Provide customers with highest rated User  Interface (UI) Reduce customer churn  Provide competitive edge 
  11. 11. Rationale: Mass Distribution No subscriber acquisition costs (SAC)  Take advantage of massive existing  distribution channels of MSOs Capitalizing on our core competence  Reduce manufacturing costs 
  12. 12. Marketing Strategy: Mass Distribution Cross-functional team with sales and R&D to  develop product packages (complete by month 1) Strengthen relationships with  Comcast, Cox, Cablevision (begin upon completion of product packages) Develop relationships with Time Warner  Cable and Charter (begin in month 6)
  13. 13. Advertising and Audience Research Targets: Network & Advertisers  Prime Prospects: Current Clients   BestBuy, Disney, NBC, Target, E*Trade, General Motors, Novartis, BMW, Lexus, Sprite, Kraft Foods, Lending Tree, Sony Pictures, Burger King, General Motors, Weather Channel, McDonalds, Nissan, Visa Possible Additional Targets   ABC, CBS, Fox  Open Door Policy: The sky is the limit
  14. 14. Value Proposition: Network & Advertisers Provide more advanced and interactive ads   Provide alternate means of advertising  Ability to measure commercial viewership Provide more extensive consumer research   Viewer sample of 20,000 vs. 10,000 (Nielsen)  Second-second analysis vs. minute-minute  Capable of capturing DVR viewers  TiVo subscribers are hard to reach, young, and affluent
  15. 15. Rationale: DVR-based Advertising Low competition  Minimal capital investment required  High margin potential  Offer innovative advertising solutions 
  16. 16. Marketing Strategy: Advertising Increase ad-sales staff (begin in month  1) Promote TiVo-based advertising platform  (begin in month 1) Create cross-functional teams with  audience research staff to determine potential advertising clients (begin upon completion of research template)
  17. 17. Rationale: Audience Research Strong brand recognition lends credibility to  audience research capabilities Huge existing database requiring no further  capital expenditures More extensive and efficient utility than  Nielsen’s service $900+ million market 
  18. 18. Marketing Strategy: Audience Research Create cross-functional teams with advertising staff  to standardize report template (complete by month 2) Promote through current MSO partners (begin upon  completion of template) Expand to other networks and advertisers  (begin in month 6) Cross-promote with advertising 
  19. 19. Pricing Strategy Subscription Pricing  Service Charge: $13 – 16 per month for  MSO consumer  TiVo nets approximately $1 per subscriber Advertising Pricing – variable based upon  client need and means Audience Research Pricing – variable  pricing depending on Nielsen service rates
  20. 20. 2008 Forecasted Income Statement Projection Worst Case Most Likely Best Case PROJ. REVENUES TiVo Service $158,360,294 $158,360,294 $158,360,294 DirecTV $27,072,355 $27,072,355 $27,072,355 New MSOs $14,070,000 $22,110,000 $36,180,000 Audience Res. $18,000,000 $67,500,000 $90,000,000 Advertising $27,500,000 $30,800,000 $34,000,000 TOTAL REVS. $245,002,650 $305,792,650 $345,612,650 PROJ. $167,955,000 $167,955,000 $167,955,000 EXPENSES NET INCOME $77,047,650 $137,837,650 $177,657,650
  21. 21. 2009 Forecasted Income Statement Projection Worst Case Most Likely Best Case PROJ. REVENUES TiVo Service $139,357,059 $139,357,059 $139,357,059 DirecTV $23,823,673 $23,823,673 $23,823,673 New MSOs $21,966,000 $40,548,000 $62,514,000 Audience Res. $36,000,000 $168,750,000 $270,000,000 Advertising $30,250,000 $37,822,500 $46,240,000 TOTAL REVS. $251,396,732 $410,301,232 $541,934,732 PROJ. $172,993,650 $172,993,650 $172,993,650 EXPENSES NET INCOME $78,403,082 $237,307,582 $368,941,082
  22. 22. Review Continue service of current TiVo subscribers  Halt production of TiVo stand-alone DVRs  Focus on development of ARM, and ARM’s  “reach” to networks and advertisers (extremely lucrative ROI potential) Pursue new mass distribution partnerships  with cable distributors Redirect R&D funding to software, ARM,  and advertising innovations
  23. 23. Long-Term Horizon Initiate mass distribution partnerships with  satellite and small cable distributors Investigate international market viability 
  24. 24. Questions? Thank You!

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