Color Kinetics Inc A Case Study Solution and Analysis
NASCAR (National Association for Stock Car Vehicle Racing) is a company performing series of Stock Car racing in United States and acting as a sanctioning body for driving the rules for Stock Car Racing. 2) Stock Vehicle Racing by NASCAR is the second largest viewer sport, with greatest number of sponsors. 1) The other sources of profits for Color Kinetics Inc A Case Study Analysis consists of; 10% of the overall profits from television rights, sanctioning charges i.e. $1-2 million per race, and licencing NASCAR brand name to business.
NASCAR has a closed business culture with the non-interventionist approach. The structure of Automobile of Tomorrow by NASCAR, with an objective of safety for the chauffeurs, brought numerous tensions among the stakeholders of the sport.
The interaction audit, performed in 2010, exposed that despite the truth that the organisation extremely rely on the communications between its stakeholders, there was no recognizable organisation communication strategy. (
The audit explained different lacking of NASCAR in regards to lack of internal combination, lack of fan management method and absence of social and digital media of marketing. The business has complicated environment with independent tracks, chauffeurs and groups. This structure with closed business culture bring various obstacles in accelerating a change. Other partners in environment includes the media networks i.e. television and radio, and business online marketers.
Color Kinetics Inc A Case Study Analysis viewers was highly loyal to the sport and the brand names connected with the NASCAR, making it appealing for sponsors and corporate marketers.
The company is currently dealing with the problem of declining rates of participation at racing tracks and rates of tv viewers. This can put a substantial impact on its incomes from sponsors, media rights, and from other sources of income.
Although the company was rather effective till 2005 with its conventional marketing techniques, however right after 2005 the company starts dealing with various issues consisting of decline of its fan base. A number of external in addition to internal aspects are responsible for the decline. Internal factors include; inadequate investment in social media and other digital medias of.
Fan base of NASCAR comprised of married males with a typical age of 47, which passes their fandom to their children and create generational commitment. The family system in America was altering resulting in decrease of influence of married male fan base over their youngsters. In addition to it understandings about car was also changing with perceiving automobile a lorry to reach at point B from point A, instead of as a fun job. Other obstacles for Color Kinetics Inc A Case Study Analysis includes the shift of its fans to other sports as they were improving their fan's experience allowing access to their broadcasts out of the houses through jumbo turns, Wi-Fi gain access to, and so on. These all obstacles were tending the company to revise its marketing strategies.
In SWOT analysis, strengths specified as business's qualities which are various from its competitors. These are company's core proficiencies on which business efficiency or company success based on. Color Kinetics Inc A Case Study Help core proficiencies includes it has rights of determining guidelines as approving body. Policies and rules relating to expert stock cars and truck racing are dictated by NASCAR like if any group with required abilities and resources can enter into races by following rules and guidelines determined by NASCAR. NASCAR has monopoly it this element. Its strengths likewise consists of that it has title of second biggest spectator sport in the United States with having more fortune 500 sponsors based in United States. Its races were used to transmit in more than 150 nations all over the world with more than $56 million incomes. The primary sources of their incomes come from tv rights, approving fees, sponsorship and licensing. It has longest season of 10 months and having ownership of three national series i.e. Outdoor camping World Truck Series, the Sprint Cup Series and the Nationwide Series. It has also big resource of fans and corporate sponsors. All the events of NASCAR are sponsored by corporates because of biggest brand name commitment of fans toward brands promoted by Color Kinetics Inc A Case Study Solution. (See Appendix A).
Weaknesses of NASCAR includes its close culture which is non collaborative. Color Kinetics Inc A Case Study Solution develops Automobile of Tomorrow without partnership so result is that drivers did not like that principle. It was also found that NASCAR had no effective strategy for company interaction.
Opportunities in SWOT analysis are external aspects which can be favourable to company or the external elements on which business is having competitive benefit. NASCAR typically utilized to rely on traditional media sources like local paper for promotion of its sports. Normally these traditional media sources attempt to cover their home team and particular kind of events. NASCAR likewise came to know from these conventional media outlets that sport was hard to cover. Media landscape likewise changed from standard to digital landscape. Papers failed. NASCAR can deal with its abilities to get optimal possible take advantage of this brand-new digital landscape. NASCAR have underinvestment in digital resources. So it can capitalize in social and digital media to get its advantages. Digital rights of NASCAR were also offered to Turner Sports. NASCAR utilized to earn money check of around $15 million annually from Turner Sports. There are number of cons behind this offer. For example Color Kinetics Inc A Case Study Analysis had to get approval from Turner Sport if it wish to produce its Facebook page, twitter account and even mobile application. Turner Sport also had rights of every video which is shoot during race at track. Then they are needed to pay licensing fees to Turner Sport, if media sources like newspapers, magazines and cable channels want to post videos of races on their respective pages. NASCAR can work on conditions and terms and try to work out with Turner Sports to get optimal advantages of it. Star power plays really important function in producing profits from every sport. However it was kept in mind that Color Kinetics Inc A Case Study Analysis is lagging in this location i.e. star power. When sports fans were asked concerning popular stars and stars then NASCAR motorist was not discovered even in leading twenty actions. NASCAR can put efforts in this area too for revenue generation. They must direct their chauffeurs that how they can become sport stars. Four tactical focuses which are produced by research group can also be worked as opportunity for NESCAR. These four strategic focuses compares and analysis Color Kinetics Inc A Case Study Solution strategies.
Economic down turn was experienced in late 2000 which can be hazard for NASCAR due to the fact that if there is financial down turn then individuals would be having less return on financial investment. Economic down turn likewise results in boost fuel rates which likewise impacted NASCAR. Now if NASCAR make significant financial investments in new sections which are based on brand-new clients then it might deal with unfavorable comments from its core fan base.
Porter's Five Forces Analysis
Porter's 5 forces is a design that is used to analyse market in which business is working. It assists in identifying what are strengths and weakness of any particular industry. It suggest that every industry is various from one another. It is essential to comprehend industry in which company is working because NASCAR's bottom line i.e. net revenue is greatly depends upon this. There are 5 forces that are used to identify profitability, strength and appearance of Color Kinetics Inc A Case Study Analysis business.
These chauffeurs can go against NASCAR if they got better chance in terms of prizes and tv direct exposure. If audiences take pleasure in other race automobiles and motorists more than NASCAR then viewers can shift to those other interesting cars and drivers. NASCAR might be having hazard from its 2 direct rivals that is Formula 1 and Moto GP.
The supplier power indicates the variety of providers are available in market and what is the expense related to provider if company shifts from one supplier to another. In this industry there is supply monopoly due to the fact that chauffeurs with needed resources and abilities are restricted.
This force is regarding to consumers that is it easy for clients to shift to other products. If there is more changing expense is associated then consumers are less most likely to change. When it comes to NASCAR consumers are its viewers. Due to the fact that viewers will having low changing cost, audiences can switch to other competitors quickly.
Danger of Alternative
Substitutes are referred as options. The substitutes in this case can be other entertainment implies like viewers can shift to other sports. There are broad range of replacements are available in this circumstance which suggests that danger of substitute is high.
Threat of New Entry
It is defined as how it is easy for any business to enter in that particular industry. When it comes to Color Kinetics Inc A Case Study Help danger of new entry is low. If any business needs to enter in this business than they have to make heavy investments, because. They require to develop cars and racing tracks and also needs to pay large total up to chauffeurs for changing.
As NASCAR is working in various markets so it requires to deal with different policies. It is also noted that NASCAR has actually dealt with increased scrutiny concerning regulative. Every federal government has different top priority so NASCAR has to be prepared for it as top priority can be moved to other sector.
Financial aspects consists of tax rate, exchange rate, economic performance of that specific company, conditions of labour market, inflation rate etc. Fortunes of the NASCAR and its rivals can be impacted if there is federal government intervention in the marketing and sales sector. NASCAR can leverage capabilities of workers to create new chances and enhance existing opportunities.
Every society is various from each other. Each has different social values and standards. It assists in comprehending relating to society and preference of clients. Social aspects consists of traditions, culture, mindsets towards specific product and services, demographics, standards, interests etc. It can be concluded that advertising through other means rather than standard (i.e. paper) can be chosen in this society.
In this case of NASCAR it can be noted that business are greatly investing for research study and development. NASCAR should also work on its media rights policy with Turner Broadcasting System.
Legal plays a crucial function in every country since every country has different legal terms. Color Kinetics Inc A Case Study Solution needs to be make certain that they protect their legal rights in every county so any business does not harm to its legal rights.
Environmental elements are likewise important for every business. NASCAR needs to make sure that its cars are not producing contamination more than appropriate level.
7 P's of Marketing
The products of Color Kinetics Inc A Case Study Solution in its product portfolio are; racing events tickets, racing tracks, sponsor's marketing, media rights, licencing NASCAR brand, sanctioning guidelines for races and ad-space to business online marketers during broadcast of NASCAR races. (Hanlon, 2018).
Pricing method of NASCAR for its race events tickets is based upon the venue and value of the racing occasions. Along with race events tickets, NASCAR likewise charge various service charge to its stakeholders and earns earnings. It charged approving costs of $1-2 million per race on average in 2005.
Marketing method of Color Kinetics Inc A Case Study Help is extremely based upon its fan base. A strong fan base share its fandom with others and increase the variety of audiences for NASCAR races. However, the business is not totally trusted its fan base for its promotion and promote through local radio stations too. The company has actually likewise adopted the merchandising media of promo, in which the company offers merchandises with its logo.
NASCAR have its racing tracks in different cities in United States. The most important tracks of NASCAR consists of Atlanta Motor Speedway in Georgia, Car Club Speedway in California and Darlington Raceway in South Carolina. It attempts to perform its races in most of the cities in United States to understand nationwide appeal.
Nestle individuals technique is consisted of offering better experience to its viewers, its fan base and to all of its stakeholders. People are a crucial aspect of Color Kinetics Inc A Case Study Analysis A marketing strategy as its events are the source of entertainment for crowd. Its individuals method consists of efforts to provide better experience to its Fans, Race Drivers, Team, Event Organizers etc., all of which come under people strategy of NASCAR.
Several business processes are required to conduct racing events in an efficient method. These processes consist of; correct schedule of time, plan for viewers, offering tickets, plan of area for sponsors, managing logistics etc. These all processes contribute I building NASCAR image, enhancing viewers experience and increasing fan base.
Essential physical evidences for the NASCAR consists of the existence of its racing tracks, stock automobiles and racing events. Along with it, its retailing brand names including tee shirts, caps, goodies etc., likewise act as a physical evidence for NASCAR.
Product Life Process Assessment.
The racing occasions by NASCAR was presented on June 19, 1949. At the first stage competitors for NASCAR was low, as the competitors drove the automobiles comparable to the automobiles driven by common people.
The very first NASCAR based track, particularly the Darlington Raceway track, was started in 1950 in South Carolina. After the growth of racing tracks the business moved towards transmitting its races on television in 1979.
In 1972, William France Jr., ended up being the president of NASCAR and n about 3 decades, he transformed NASCAR from a local Sport popular organization into one with worldwide fan base. He initiated a new era of lucrative sponsorships and tv agreements for NASCAR.
The maturity period for NASCAR started with the efforts of William France Jr., with the business having wide range of earnings sources. The business has about 500 sponsors with transmitting its events in about 150 countries. The business has large number of tracks in the majority of the cities of United States.
The major causes of decline include the monetary crisis of 2008, which increased the cost of getting here at tracks for audiences due to increasing fuel costs, and the shifting of its fan base towards other sports.
The market division of Color Kinetics Inc A Case Study Analysis can be divided into four segments; Geographic, Demographic, Psychographic and Behavioural. (Dutta, 2018).
The geographical segmentation of Color Kinetics Inc A Case Help is based upon the geographical existence of its tracks in different states and cities in United States, and the television broadcasting of its occasions in different nations. The business has 23 tracks in about 20 states of America and has tv broadcast through numerous Medias i.e. TNT, ESPN, ABC and Fox, in about 150 countries.This large geographical division supplies the business regional in addition to global fan base.
The demographic division of Color Kinetics Inc A Case Study Solution is also highlydiverse based upon the gender, income and age of the customer. To increase the market segment of its market NASCAR must revise its marketing strategies to bring in more age groups and lower its costs to enter in the market section with a low typical income.
The psychological attributes of most of the fans are quite comparable. NASCAR has a fan base with a commitment. Once in a week, NASCAR fans view it compulsive to purchase tickets and see the races. 71% of them prefer to acquire items with a NASCAR brand name. They are quite extrovert and want to join other fans while racing. They want quality racing with low price at hassle-free location. Although Color Kinetics Inc A Case Study Analysis has attempted to increase the quality of its racing by presenting phase racing, they likewise have actually tried to lower prices and make the event easier by presenting live racing.
Behavioural segmentation of Color Kinetics Inc A Case Study Solution is based upon the behaviour of fans in regards to enjoying the race live on the tv or by entering the events. Presently, the fans preference is towards enjoying the race in your home on television instead of going, as the client experience at NASCAR tracks is not beneficial in addition to expensive. This choice makes the rates for attendance lower than the rates for tv viewers. NASCAR has to change the behaviour of its fan base by presenting qualitative services at its tracks.
Among the prospective target audience of Color Kinetics Inc A Case Study Help was Hispanics; the young and growing population of United States. The marketplace sector has excellent possible for NASCAR as the population was growing at a greater rate and it was anticipated to end up being thrice after forty years and the segment has increasing wealth rate with about $1 trillion of wealth in 2014. Although, the section shows affinity with vehicle culture, but require a more concentrated marketing towards inviting the segment towards racing.
Kids are also one of the potential target market sector for NASCAR, as they are more linked socially than other groups. Producing fan base among kids can provide a possible boost in the number of fans for racing due to their connection. Kids invest most of their times in utilizing smart devices and playing video games. Automobile racing games developed by Color Kinetics Inc A Case Study Help can be a possible source of getting attention of kids towards NASCAR track racing. NASCAR's digital features related to kids are not capable of getting the attention. NASCAR requires more attention towards customizing and improving its digital features to attract the kids target market.
This big expenditure makes the section potential for NASCAR marketing technique of increasing its fan base. The market segment considers NASCAR as a company lacking in producing a multiculturalism environment. NASCAR should take different steps to enhance the experience of Generation Y consumers in its occasions.
5 C's of Marketing
5 C's of marketing helps in taking decisions relating to marketing. These 5 C's requirements to be analysed properly for taking any marketing decision. These 5 C's represent Environment, Business, Collaborators, Consumers and Rivals.
It requires to make PESTLE analysis in order to comprehend environment or context in which NASCAR is working. PESTLE represents political, economic, social, technical, ecological and legal and is mentioned above.
NASCAR is a vehicle racing business with having USP of high quality car racing with an international structure. Its sector is sports team and occasions. Its target audience is males in the age group of 15-60 years. Company has closed corporate culture and having non-interventionist method.
Collaborations includes distributors, providers and alliances of Color Kinetics Inc A Case Study Help. It is collaborated with different racing teams which are participating in racing. It also teamed up with Turners Sport for digital rights. NASCAR utilized to make money check of around $15 million each year from Turner Sports. There are number of cons behind this deal. NASCAR had to get approval from Turner Sport if it desire to create its Facebook page, twitter account or even mobile application. Turner Sport also had rights of every video which is shoot during race at track.
The customer of Color Kinetics Inc A Case Study Solution are its viewers. They target consumers with having age of 15-60 years. Fan base of NASCAR consisted of married males with an average age of 47, which passes their fandom to their children and develop generational loyalty.
Teams usually represents sponsors in NASCAR and the medium of advertising is motorists. These chauffeurs can go versus NASCAR if they got much better chance in terms of prizes and television exposure.
1. Preserving and developing Facebook Page.
One of the possible target markets sectors for NASCAR is Hispanics which is the growing population section of USA but unfortunately NASCAR had actually been unable to draw in the this targeted sector. It should establish a Facebook page containing the info relating to the races and the places of tracks to make the consumer informative about the core operations of NASCAR.
2. Developing and Updating Accounts of Key Drivers.
Color Kinetics Inc A Case Study Help drivers has a low star power as compare to gamers of other sports. The bad contacts with fans result in less tourist attraction of viewers towards the racers and a low star power. Star power is a crucial element for bring in viewers towards tracks and towards tv.
3. Developing New Games and improving present games for kids.
In order to attract these kids, NASCARA must enhance its current racing games by presenting modification in the vehicles i.e. changing colours, choice of speed, presenting group racing in the video game, using much better graphics related to the racing tracks and introducing different levels in the game. All these modifications in the present game would supply better experience to kids.
Together with it, NASCAR must also construct new games associated with racing like kids racing with kids characters as drivers, cartoon racing with racing between various animation characters with an option of choosing the preferred animation character for the kids. These methods would make it possible for the business to bring in among its prospective target sectors.
4. Presenting multiculturalism at occasions.
Color Kinetics Inc A Case Study Solution occasions are consisted of fans with really few cultural diversity, due to expense of arrival in events, making it unsightly for the consumers perceiving sport events as get-togethers i.e. Generation Y clients. As the Generation Y customers are a prospective target audience for NASCAR, for that reason the business needs to take specific measures to attract this possible target market. It should adopt strategies to attract the customers far from the tracks location with different culture. The technique to do so might be offering special discount rates on tickets or totally free tickets to viewers coming from a particular range or from another state. It would increase multiculturalism of the fans and would make Generation Y consumers more pleased.
5. Improving Customer Experience at Tracks.
NASCAR ought to work on infrastructure and amenities at tracks since on the race day audiences got dissatisfied. Viewers have numerous expectations from Color Kinetics Inc A Case Study Analysis since in exact same industry other business are providing better services than NASCAR. IF NASCAR don't work on this issue then its fans may shifted to its rivals.
Marketing Spending plan
Marketing spending plan made on the basis of the above methods for the duration of 5 years from 2011 to 2015, shows the expense associated information for the marketing methods. (See Appendix B). It can be seen that technique 5 of enhancing customer experience at tracks would require greatest initial financial investment and cost and technique 4 of presenting multiculturalism will need lowest preliminary investment with lowest even more each year cost. The business must focus on the resource allowance on these methods on the basis of its offered resources and the possible benefits which the technique would provide.
NOTE: The worths about expense are presumed on rational basis due the absence of figures and truths associated with cost in the event research study. Inflation rate of United States is assumed to be 10%.
On the basis of deep analysis of the internal and external aspects of Color Kinetics Inc A Case Study Analysis triggering the decrease of television viewership rate and attendance rate at tracks, the above marketing methods are suggested to NASCAR to increase its fan base in long term. These techniques would handle internal elements like bad consumer experience at tracks, insufficient social networks marketing, incapable digital medias like video games, lack of culturalisms at tracks and so on, along with with external elements like shifting of fans towards other sports, demographical changes in America and changing domesticity styles.