Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution and Analysis
NASCAR (National Association for Stock Cars And Truck Automobile Racing) is a company performing series of Stock Cars and truck racing in United States and acting as a sanctioning body for driving the guidelines for Stock Automobile Racing. 2) Stock Automobile Racing by NASCAR is the 2nd largest viewer sport, with highest number of sponsors. 1) The other sources of earnings for Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution consists of; 10% of the overall profits from tv rights, sanctioning costs i.e. $1-2 million per race, and licencing NASCAR brand to companies.
NASCAR has a closed corporate culture with the non-interventionist approach. This non collective technique brings stress in the sport. The building of Vehicle of Tomorrow by Competitive Cost Analysis Scale And Utilization Calculations Case Study Analysis, with an intention of security for the chauffeurs, brought different tensions among the stakeholders of the sport.
The interaction audit, conducted in 2010, exposed that despite the truth that the business extremely rely on the interactions in between its stakeholders, there was no recognizable business communication method. The market's target customers, direction and objectives were all unknown.
The audit pointed out different lacking of NASCAR in terms of lack of internal integration, lack of fan management method and lack of social and digital media of marketing.
Competitive Cost Analysis Scale And Utilization Calculations Case Study Analysis viewers was highly devoted to the sport and the brand names connected with the NASCAR, making it appealing for sponsors and corporate online marketers.
The company is presently dealing with the problem of decreasing rates of attendance at racing tracks and rates of tv audiences. This can put a significant impact on its revenues from sponsors, media rights, and from other sources of income.
Although the business was quite successful till 2005 with its traditional marketing strategies, however soon after 2005 the business begins facing various problems including decline of its fan base. Numerous external along with internal factors are responsible for the decrease. Internal factors consist of; insufficient financial investment in social media and other digital medias of.
Fan base of NASCAR made up of married males with an average age of 47, which passes their fandom to their youngsters and produce generational commitment. Other challenges for NASCAR includes the shift of its fans to other sports as they were improving their fan's experience enabling access to their broadcasts out of the homes through jumbo turns, Wi-Fi gain access to, etc.
In SWOT analysis, strengths specified as company's qualities which are different from its competitors. These are company's core competencies on which business efficiency or company success based upon. Competitive Cost Analysis Scale And Utilization Calculations Case Study Help core proficiencies includes it has rights of dictating rules as approving body. Guidelines and rules regarding professional stock vehicle racing are dictated by NASCAR like if any group with required skills and resources can enter into races by following rules and regulations determined by NASCAR. So NASCAR has monopoly it this element. Its strengths likewise consists of that it has title of second largest spectator sport in the United States with having more fortune 500 sponsors based in United States. Its races were utilized to broadcast in more than 150 countries around the world with more than $56 million earnings. The main sources of their incomes come from television rights, sanctioning charges, 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 large resource of fans and business sponsors. All the occasions of NASCAR are sponsored by corporates because of greatest brand loyalty of fans toward brand names advertised by Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution. (See Appendix A).
Weaknesses in SWOT Analysis are considered as external elements. Weak points includes the factors that stops company to carry out at needed level of efficiency. Weaknesses of NASCAR includes its close culture which is non collective. They have non-interventionist approach. They normally used to form rules and other needed processes without intervention of others which leads to poor cooperation. NASCAR establishes Automobile of Tomorrow without cooperation so result is that chauffeurs did not like that concept. As this is racing sport so covering of sports by media is likewise difficult. It was also discovered that NASCAR had no reliable strategy for service interaction. If it took place off track, they do not know how to handle concern. Ineffective business interaction leads to that they do not have clear direction for their long term objectives. They do not understand that where they wish to see this sport in future.
NASCAR generally used to rely on conventional media sources like local newspaper for publicity of its sports. NASCAR also came to understand from these traditional media outlets that sport was hard to cover. When sports fans were asked relating to popular celebs and stars then NASCAR chauffeur was not discovered even in leading twenty responses.
Economic down turn was experienced in late 2000 which can be danger for NASCAR since if there is financial down turn then people would be having less return on investment. Economic down turn also results in boost fuel costs which also affected NASCAR. Now if NASCAR make substantial investments in new segments which are based on new consumers then it might deal with unfavorable comments from its core fan base.
Porter's Five Forces Analysis
Porter's 5 forces is a model that is utilized to evaluate industry in which business is working. It assists in determining what are strengths and weakness of any particular industry. It suggest that every market is various from one another. It is necessary to understand market in which company is working since NASCAR's bottom line i.e. net revenue is heavily depends upon this. There are 5 forces that are utilized to determine success, strength and appearance of Competitive Cost Analysis Scale And Utilization Calculations Case Study Analysis organisation.
These chauffeurs can go versus NASCAR if they got better opportunity in terms of prizes and television direct exposure. If viewers delight in other race vehicles and drivers more than NASCAR then viewers can move to those other fascinating automobiles and chauffeurs. NASCAR might be having hazard from its two direct rivals that is Formula 1 and Moto GP.
If company shifts from one supplier to another, the supplier power shows the number of providers are readily available in industry and what is the expense associated with supplier. Because chauffeurs with required resources and abilities are limited, in this market there is supply monopoly.
In the case of NASCAR customers are its viewers. Audiences can change to other rivals quickly due to the fact that viewers will having low changing expense.
Risk of Alternative
Alternatives are referred as options. The replacements in this case can be other entertainment implies like audiences can move to other sports. There are wide range of alternatives are available in this circumstance which recommends that threat of substitute is high.
Hazard of New Entry
It is defined as how it is simple for any company to enter in that specific industry. In the case of Competitive Cost Analysis Scale And Utilization Calculations Case Study Analysis danger of new entry is low. If any company needs to enter in this service than they have to make heavy investments, since. They require to build cars and trucks and racing tracks and likewise requires to pay substantial total up to chauffeurs for switching.
As NASCAR is working in different markets so it requires to deal with various guidelines. It is likewise kept in mind that NASCAR has actually faced increased analysis regarding regulatory. Every government has various concern so NASCAR has actually to be prepared for it as concern can be shifted to other sector.
Financial factors includes tax rate, exchange rate, economic performance of that particular company, conditions of labour market, inflation rate and so on. Fortunes of the NASCAR and its rivals can be impacted if there is government intervention in the marketing and sales sector. NASCAR can take advantage of abilities of employees to create brand-new chances and enhance existing chances.
Each has various social values and standards. It helps in understanding concerning society and preference of customers.
In this case of NASCAR it can be kept in mind that companies are greatly spending for research study and development. NASCAR needs to likewise work on its media rights policy with Turner Broadcasting System.
Due to the fact that every nation has various legal terms and conditions, Legal plays a crucial function in every country. Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution requires to be ensure that they safeguard their legal rights in every county so any company does not harm to its legal rights.
Environmental factors are also essential for every business. NASCAR requires to make sure that its automobiles are not generating contamination more than appropriate level.
7 P's of Marketing
The items of Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution in its product portfolio are; racing occasions tickets, racing tracks, sponsor's marketing, media rights, licencing NASCAR brand name, sanctioning rules for races and ad-space to corporate marketers during broadcast of NASCAR races. (Hanlon, 2018).
Rates method of NASCAR for its race events tickets is based upon the venue and significance of the racing occasions. Along with race occasions tickets, NASCAR also charge various service fees to its stakeholders and earns profits. For instance it charged sanctioning costs of $1-2 million per race typically in 2005.
Advertising strategy of NASCAR is highly based upon its fan base. A strong fan base share its fandom with others and increase the number of audiences for NASCAR races.
NASCAR have its racing tracks in numerous cities in United States. The most important tracks of NASCAR includes Atlanta Motor Speedway in Georgia, Vehicle Club Speedway in California and Darlington Raceway in South Carolina. It tries to conduct its races in the majority of the cities in United States to comprehend across the country popularity.
Nestle people strategy is consisted of providing much better experience to its audiences, its fan base and to all of its stakeholders. Individuals are a crucial aspect of Competitive Cost Analysis Scale And Utilization Calculations Case Study Help A marketing technique as its occasions are the source of entertainment for crowd. Its people strategy includes efforts to offer much better experience to its Fans, Race Drivers, Crew, Event Organizers etc., all of which come under people technique of NASCAR.
A number of company procedures are needed to carry out racing events in an effective way. These processes include; proper schedule of time, arrangement for viewers, offering tickets, arrangement of area for sponsors, handling logistics and so on. These all procedures contribute I building NASCAR image, enhancing spectators experience and increasing fan base.
Essential physical proofs for the NASCAR consists of the existence of its racing tracks, stock cars and trucks and racing events. In addition to it, its merchandising brand names consisting of t-shirts, caps, goodies and so on, likewise act as a physical proof for NASCAR.
Product Life Cycle Evaluation.
The racing events by NASCAR was presented on June 19, 1949. At the very first phase competition for NASCAR was low, as the rivals drove the cars comparable to the automobiles driven by ordinary individuals.
After conducting its first race effectively the business moved towards developing its own tracks. The first Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution based track, specifically the Darlington Raceway track, was initiated in 1950 in South Carolina. It was followed by facility of more raceways consisting of Daytona International Speedway, which was opened in 1959. After the growth of racing tracks the company moved towards broadcasting its races on television in 1979. The first occasion broadcasted on tv was flag-to-flag coverage of Daytona.
In 1972, William France Jr., ended up being the president of NASCAR and n about 3 years, he transformed NASCAR from a regional Sport popular organization into one with worldwide fan base. He initiated a brand-new era of financially rewarding sponsorships and television contracts for NASCAR.
The maturity period for NASCAR began with the efforts of William France Jr., with the business having wide range of income sources. The business has about 500 sponsors with relaying its occasions in about 150 countries. The business has a great deal of tracks in the majority of the cities of United States.
The decline in the company's offerings started after 2005 with typical attendance rate per race declined by 22% from 2005 to 2010 and television viewership rate declined by 30% from 2005 to 2010. The major causes of decline include the financial crisis of 2008, which increased the cost of reaching tracks for audiences due to increasing fuel prices, and the shifting of its fan base towards other sports.
The marketplace division of Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution can be divided into four segments; Geographic, Demographic, Psychographic and Behavioural. (Dutta, 2018).
The geographical division of Competitive Cost Analysis Scale And Utilization Calculations Case Solution is based upon the geographical existence of its tracks in numerous states and cities in United States, and the television broadcasting of its events in various countries. The business has 23 tracks in about 20 states of America and has tv broadcast through different Medias i.e. TNT, ESPN, ABC and Fox, in about 150 countries.This huge geographical division provides the business regional along with global fan base.
The market division of Competitive Cost Analysis Scale And Utilization Calculations Case Study Help is also highlydiverse based upon the gender, earnings and age of the customer. To increase the market segment of its market NASCAR ought to revise its marketing methods to bring in more age groups and lower its prices to enter in the market sector with a low typical earnings.
The psychological attributes of most of the fans are quite comparable. NASCAR has a fan base with a loyalty. NASCAR fans view it compulsive to acquire tickets and see the races once in a week. 71% of them prefer to purchase items with a NASCAR brand. They are quite extrovert and want to join other fans while racing. They want quality racing with low price at convenient location. Although Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution has attempted to increase the quality of its racing by presenting phase racing, they likewise have attempted to lower costs and make the occasion easier by introducing live racing.
Behavioural division of NASCAR is based upon the behaviour of fans in terms of watching the race live on the television or by going in the occasions. Currently, the fans choice is towards enjoying the race at home on tv rather than going, as the customer experience at NASCAR tracks is not favourable as well as costly.
One of the potential target market of NASCAR was Hispanics; the young and growing population of United States. The market segment has great potential for NASCAR as the population was growing at a higher rate and it was expected to become thrice after forty years and the sector has increasing wealth rate with about $1 trillion of wealth in 2014.
Kids are also one of the potential target market segment for NASCAR, as they are more linked socially than other groups. Creating fan base amongst kids can offer a potential boost in the number of fans for racing due to their connection. Kids spend most of their times in using smartphones and playing video games. Automobile racing video games developed by Competitive Cost Analysis Scale And Utilization Calculations Case Study Solution can be a prospective source of gaining attention of kids towards NASCAR track racing. However, NASCAR's digital functions connected to kids are not capable of getting the attention. NASCAR requires more attention towards tailoring and enhancing its digital features to bring in the kids target market.
This huge expenditure makes the segment potential for NASCAR marketing technique of increasing its fan base. The market segment thinks about NASCAR as a company doing not have in developing a multiculturalism environment. NASCAR needs to take numerous actions to improve the experience of Generation Y consumers in its occasions.
5 C's of Marketing
5 C's of marketing helps in taking choices concerning marketing. These 5 C's requirements to be analysed properly for taking any marketing decision. These 5 C's represent Environment, Business, Collaborators, Clients and Competitors.
It needs to make PESTLE analysis in order to understand climate or context in which NASCAR is working. PESTLE means political, financial, social, technical, environmental and legal and is stated above.
Competitive Cost Analysis Scale And Utilization Calculations Case Study Help is a car racing company with having USP of high quality vehicle racing with a worldwide structure. Its sector is sports group and occasions.
Collaborations consists of suppliers, providers and alliances of NASCAR. NASCAR utilized to get pay check of around $15 million every year from Turner Sports. NASCAR had to get approval from Turner Sport if it desire to create its Facebook page, twitter account or even mobile application.
The consumer of Competitive Cost Analysis Scale And Utilization Calculations Case Study Help are its viewers. They target clients with having age of 15-60 years. Fan base of NASCAR consisted of married males with a typical age of 47, which passes their fandom to their youngsters and produce generational loyalty.
The direct competitors of NASCAR are Formula 1 and Moto GP. Teams usually represents sponsors in NASCAR and the medium of advertising is motorists. Therefore it can be stated that chauffeurs and race cars are competitors. If they got much better opportunity in terms of prizes and television exposure, these chauffeurs can go against NASCAR.
1. Establishing and Maintaining Facebook Page.
One of the possible target audience sectors for NASCAR is Hispanics which is the growing population segment of U.S.A. however regrettably NASCAR had actually been not able to bring in the this targeted section. In order to bring in the young growing generation the NASCAR need to market by utilizing social networks like Facebook. It must develop a Facebook page including the information relating to the races and the areas of tracks to make the customer informative about the core operations of Competitive Cost Analysis Scale And Utilization Calculations Case Study Analysis. It must also update its Facebook page on everyday basis to offer info about its approaching occasions. This would make the target market segment more informative about the business and would lead to drawing in big fans base.
2. Establishing and Updating Accounts of Key Drivers.
NASCAR drivers has a low star power as compare to players of other sports. Its ranks 7th in regards to star power (see Case Display). The significant factor behind it is that, the racers mainly play in groups and are not able to construct an essential account and maintain a close contact with fans. The bad contacts with fans result in less destination of viewers towards the racers and a low star power. Star power is a crucial factor for drawing in audiences towards tracks and towards television. The star power for the chauffeurs at NASCARA could be enhanced by producing and upgrading accounts of essential motorists by NASCARA itself. This would eliminate the requirement of forcing drivers to preserve their accounts and would lead to increasing fans attention towards NASCARA motorists.
3. Developing New Games and improving present video games for kids.
In order to bring in these kids, NASCARA should improve its present racing video games by introducing personalization in the automobiles i.e. changing colours, choice of speed, presenting group racing in the video game, utilizing better graphics related to the racing tracks and presenting numerous levels in the video game. All these adjustments in the present game would offer much better experience to kids.
Together with it, NASCAR needs to also build brand-new video games associated with racing like kids racing with kids characters as drivers, animation racing with racing between various animation characters with an option of choosing the favourite animation character for the kids. These strategies would allow the business to attract among its prospective target sectors.
4. Introducing multiculturalism at events.
NASCAR occasions are comprised of fans with really couple of cultural diversity, due to expense of arrival in occasions, making it unsightly for the customers perceiving sport events as social occasions i.e. Generation Y customers. As the Generation Y clients are a possible target market for NASCAR, therefore the company must take particular steps to attract this potential target market.
5. Improving Client Experience at Tracks.
Competitive Cost Analysis Scale And Utilization Calculations Case Study Analysis should deal with facilities and amenities at tracks due to the fact that on the race day audiences got dissatisfied. Viewers have numerous expectations from NASCAR since in very same industry other business are supplying better services than NASCAR. Then its fans might moved to its competitors, if NASCAR do not work on this concern. According to fans there were not sufficient centers were available as compare to other sports companies. NASCAR should make sure that it provide appropriate facilities that consists of cleaned up restrooms, comfy seating plan. They ought to also offer WIFI services and accessibility of credit cards throughout that track. It must be likewise ensure that there are enough jumbo turns positioned at all required locations. There must be likewise food stalls that offer quality food to audiences. In this way audiences will be having enjoyable experience at the day of event. (See Appendix B).
Marketing spending plan made on the basis of the above strategies for the period of 5 years from 2011 to 2015, shows the cost associated information for the marketing methods. (See Appendix B). It can be seen that method 5 of improving client experience at tracks would require greatest initial financial investment and cost and technique 4 of introducing multiculturalism will require lowest initial financial investment with least expensive further per year expense. The company ought to focus on the resource allowance on these techniques on the basis of its offered resources and the prospective advantages which the method would offer.
KEEP IN MIND: The worths about cost are presumed on reasonable basis due the absence of facts and figures connected to cost in the case research study. Inflation rate of United States is presumed to be 10%.
On the basis of deep analysis of the internal and external aspects of Competitive Cost Analysis Scale And Utilization Calculations Case Study Help causing the decline of television viewership rate and presence rate at tracks, the above marketing techniques are recommended to NASCAR to increase its fan base in long run. These techniques would cope with internal elements like bad customer experience at tracks, inadequate social media marketing, incapable digital medias like games, absence of culturalisms at tracks etc., along with with external factors like moving of fans towards other sports, demographical changes in America and changing family life designs.