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Note On Valuation Of Venture Capital Deals Case Study Solution and Analysis


Introduction

NASCAR (National Association for Stock Car Car Racing) is a company conducting series of Stock Car racing in United States and acting as a sanctioning body for driving the rules for Stock Automobile Racing. 2) Stock Automobile Racing by NASCAR is the second largest spectator sport, with greatest number of sponsors. 1) The other sources of profits for Note On Valuation Of Venture Capital Deals Case Study Analysis consists of; 10% of the overall revenue from tv rights, approving charges i.e. $1-2 million per race, and licencing NASCAR brand name to companies.

NASCAR has a closed corporate culture with the non-interventionist approach. The building of Automobile of Tomorrow by NASCAR, with an intent of safety for the motorists, brought different tensions amongst the stakeholders of the sport.

The interaction audit, conducted in 2010, revealed that regardless of the truth that the business extremely rely on the interactions in between its stakeholders, there was no identifiable company interaction strategy. The industry's target consumers, instructions and goals were all unidentified.

The audit explained numerous doing not have of NASCAR in regards to lack of internal integration, absence of fan management technique and absence of social and digital media of marketing. The company has complicated ecosystem with independent tracks, drivers and teams. This structure with closed business culture bring numerous difficulties in accelerating a modification. Other partners in ecosystem consists of the media networks i.e. television and radio, and corporate marketers.

Note On Valuation Of Venture Capital Deals Case Study Analysis viewers was highly devoted to the sport and the brand names connected with the NASCAR, making it appealing for sponsors and business marketers.

Problem Statement.

The business is currently facing the problem of decreasing rates of presence at racing tracks and rates of television audiences. This can put a substantial effect on its earnings from sponsors, media rights, and from other sources of income.

Situational Analysis.

The business was quite successful till 2005 with its traditional marketing techniques, however quickly after 2005 the company begins dealing with different issues consisting of decrease of its fan base. Numerous external in addition to internal elements are accountable for the decrease. Internal elements consist of; inadequate investment in social networks and other digital medias of.

Fan base of NASCAR consisted of married males with a typical age of 47, which passes their fandom to their youngsters and produce generational commitment. The family system in America was altering resulting in reduction of impact of married male fan base over their youngsters. In addition to it perceptions about cars and truck was also altering with viewing car a lorry to reach at point B from point A, instead of as a fun task. Other obstacles for Note On Valuation Of Venture Capital Deals Case Study Solution consists of the shift of its fans to other sports as they were improving their fan's experience enabling access to their broadcasts out of the houses through jumbo turns, Wi-Fi access, etc. These all difficulties were tending the business to modify its marketing methods.

SWOT Analysis.

Strengths.


In SWOT analysis, strengths specified as business's qualities which are different from its competitors. These are business's core competencies on which company performance or company success based on. Note On Valuation Of Venture Capital Deals Case Study Help core proficiencies includes it has rights of dictating guidelines as sanctioning body. Regulations and guidelines concerning expert stock automobile racing are dictated by NASCAR like if any team with needed skills and resources can enter into races by following rules and regulations dictated by NASCAR. So NASCAR has monopoly it this element. Its strengths likewise includes 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 utilized to broadcast in more than 150 countries around the globe with more than $56 million profits. The primary sources of their incomes originate from television rights, sanctioning charges, sponsorship and licensing. It has longest season of 10 months and having ownership of 3 national series i.e. Camping World Truck Series, the Sprint Cup Series and the Nationwide Series. It has also big resource of fans and business sponsors. Since of most significant brand name loyalty of fans towards brand names advertised by NASCAR, all the events of NASCAR are sponsored by corporates. (See Appendix A).

Weaknesses.

Weak points of NASCAR includes its close culture which is non collective. Note On Valuation Of Venture Capital Deals Case Study Solution develops Cars and truck of Tomorrow without collaboration so result is that drivers did not like that idea. It was also discovered that NASCAR had no efficient technique for business communication.

Opportunities.

NASCAR generally utilized to rely on traditional media sources like local newspaper for promotion of its sports. NASCAR likewise came to understand from these traditional media outlets that sport was hard to cover. When sports fans were asked concerning popular celebrities and stars then NASCAR driver was not found even in leading twenty reactions.

Risks

Economic down turn was experienced in late 2000 which can be hazard for NASCAR due to the fact that if there is economic down turn then people would be having less return on investment. Economic down turn also results in increase fuel prices which also affected NASCAR. Now if NASCAR make considerable investments in new segments which are based on brand-new customers then it may face negative comments from its core fan base.

Porter's Five Forces Analysis

It is important to comprehend industry in which business is working because NASCAR's bottom line i.e. net revenue is heavily depends on this. There are 5 forces that are utilized to recognize success, strength and beauty of NASCAR service.

Competitive Rivalry

This force indicates capability of competitors. Groups normally represents sponsors in NASCAR and the medium of marketing is drivers. Therefore it can be said that chauffeurs and race automobiles are rivals. These motorists can go against NASCAR if they got better chance in regards to prizes and television exposure. If viewers delight in other race cars and motorists more than NASCAR then audiences can shift to those other intriguing automobiles and motorists. NASCAR could be having risk from its 2 direct rivals that is Formula 1 and Moto GP. They require to develop competitive benefits for motorists so they do not move to other competitors.

Provider Power

The provider power shows the number of providers are available in market and what is the cost related to provider if business shifts from one provider to another. Due to the fact that chauffeurs with required resources and abilities are restricted, in this market there is supply monopoly.

Buyer Power

In the case of NASCAR customers are its audiences. Audiences can switch to other competitors quickly due to the fact that viewers will having low switching cost.

Risk of Replacement

Alternatives are referred as options. The replacements in this case can be other entertainment indicates like audiences can shift to other sports. So there are vast array of replacements are offered in this situation which recommends that hazard of substitute is high.

Threat of New Entry

It is specified as how it is easy for any business to enter in that particular industry. In the case of Note On Valuation Of Venture Capital Deals Case Study Solution threat of brand-new entry is low. If any company needs to enter in this service than they have to make heavy investments, because. They need to build automobiles and racing tracks and likewise needs to pay hefty total up to drivers for switching.

PESTEL Analysis

Political


As NASCAR is working in different markets so it requires to deal with various regulations. It is likewise kept in mind that NASCAR has dealt with increased examination concerning regulatory. Every federal government has various priority so NASCAR has to be prepared for it as priority can be moved to other sector.

Affordable

Economic elements consists of taxation rate, currency exchange rate, financial performance of that particular company, conditions of labour market, inflation rate etc. If there is government intervention in the marketing and sales sector, fortunes of the NASCAR and its rivals can be affected. NASCAR can take advantage of capabilities of employees to produce new chances and improve existing opportunities.

Social

Each has various social worths and standards. It helps in understanding regarding society and choice of clients.

Technical

Innovation has impact on almost every service. It consists of development in service method. In this case of Note On Valuation Of Venture Capital Deals Case Study Solution it can be kept in mind that companies are heavily spending for research study and advancement. NASCAR must likewise deal with its media rights policy with Turner Broadcasting System.

Legal

Because every country has different legal terms and conditions, Legal plays an essential role in every country. Note On Valuation Of Venture Capital Deals Case Study Solution needs to be ensure that they safeguard their legal rights in every county so any business does not hurt to its legal rights.

Environmental

Ecological factors are likewise crucial for each company. Since generally governments do not enable those organisation which can damage to environment. These environmental factors includes laws concerning contamination, climate change, safe waste disposal, policies relating to insurance etc. NASCAR needs to make sure that its automobiles are not creating contamination more than appropriate level.

7 P's of Marketing

Product

The products of Note On Valuation Of Venture Capital Deals Case Study Analysis in its product portfolio are; racing occasions tickets, racing tracks, sponsor's marketing, media rights, licencing NASCAR brand name, sanctioning guidelines for races and ad-space to corporate marketers throughout broadcast of NASCAR races. (Hanlon, 2018).

Rate.

Prices strategy of NASCAR for its race occasions tickets is based upon the venue and significance of the racing occasions. In addition to race occasions tickets, NASCAR likewise charge various service charge to its stakeholders and makes revenue. For example it charged approving costs of $1-2 million per race on average in 2005.

Promo.

Marketing strategy of NASCAR is highly based upon its fan base. A strong fan base share its fandom with others and increase the number of viewers for NASCAR races.

Place.

NASCAR have its racing tracks in numerous cities in United States. The most essential tracks of NASCAR consists of Atlanta Motor Speedway in Georgia, Vehicle Club Speedway in California and Darlington Raceway in South Carolina. It attempts to conduct its races in most of the cities in United States to grasp across the country popularity.

Individuals.

Nestle people technique is consisted of providing much better experience to its viewers, its fan base and to all of its stakeholders. Individuals are an important element of Note On Valuation Of Venture Capital Deals Case Study Help A marketing technique as its occasions are the source of home entertainment for crowd. Its people method consists of efforts to offer much better experience to its Fans, Race Drivers, Crew, Occasion Organizers etc., all of which come under individuals strategy of NASCAR.

Procedures.

Several organisation processes are required to perform racing events in an effective way. These procedures consist of; correct schedule of time, arrangement for spectators, offering tickets, arrangement of space for sponsors, handling logistics and so on. These all procedures contribute I building NASCAR image, improving viewers experience and increasing fan base.

Physical Proof.

Crucial physical proofs for the NASCAR consists of the presence of its racing tracks, stock vehicles and racing occasions. Along with it, its merchandising brand names including tee shirts, caps, goodies and so on, likewise function as a physical proof for NASCAR.

Item Life Process Assessment.

The racing occasions by Note On Valuation Of Venture Capital Deals Case Study Analysis was introduced on June 19, 1949. The first race was held at Charlotte Speedway in North Carolina. There were about 13000 fans present in the race. At the first stage competition for NASCAR was low, as the rivals drove the cars comparable to the vehicles driven by normal individuals.

Development.

The first NASCAR based track, particularly the Darlington Raceway track, was initiated in 1950 in South Carolina. After the growth of racing tracks the company moved towards relaying its races on tv in 1979.

In 1972, William France Jr., ended up being the president of NASCAR and n about 3 years, he changed NASCAR from a local Sport popular company into one with worldwide fan base. He started a brand-new era of rewarding sponsorships and tv contracts for NASCAR.

Maturity.

The maturity period for NASCAR started with the efforts of William France Jr., with the business having wide variety of earnings sources. The business has about 500 sponsors with transmitting its occasions in about 150 nations. The company has large number of tracks in most of the cities of United States.

Decrease.

The major causes of decrease consist of the financial crisis of 2008, which increased the expense of showing up at tracks for audiences due to increasing fuel costs, and the moving of its fan base towards other sports.

Market Segmentation.

The market segmentation of Note On Valuation Of Venture Capital Deals Case Study Help can be divided into 4 sectors; Geographic, Demographic, Psychographic and Behavioural. (Dutta, 2018).

Geographical.

The geographical segmentation of Note On Valuation Of Venture Capital Deals Case Solution is based upon the geographical presence of its tracks in numerous states and cities in United States, and the tv broadcasting of its occasions in different 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 segmentation offers the business local along with worldwide fan base.

Group.

The demographic division of Note On Valuation Of Venture Capital Deals Case Study Analysis is also highlydiverse based upon the gender, earnings and age of the consumer. To increase the demographic sector of its market NASCAR ought to revise its marketing strategies to attract more age groups and lower its rates to enter in the market segment with a low average income.

Psychographic.

NASCAR has a fan base with a commitment. NASCAR fans perceive it compulsive to purchase tickets and see the races as soon as in a week. NASCAR has actually tried to increase the quality of its racing by introducing stage racing, they also have actually attempted to lower costs and make the event more practical by introducing live racing.

Behavioural.

Behavioural segmentation of NASCAR is based upon the behaviour of fans in terms of enjoying the race live on the tv or by going in the occasions. Presently, the fans choice is towards watching the race at house on television rather than going, as the consumer experience at NASCAR tracks is not beneficial as well as costly.

Target audience.

Hispanics.

One of the potential target market of NASCAR was Hispanics; the young and growing population of United States. The market section has fantastic potential for NASCAR as the population was growing at a higher rate and it was anticipated to end up being thrice after forty years and the sector has increasing wealth rate with about $1 trillion of wealth in 2014.

Kids.

Kids are also among the prospective target market sector for NASCAR, as they are more linked socially than other groups. Producing fan base amongst kids can supply a potential increase in the number of fans for racing due to their connectivity. Kids spend most of their times in using mobile phones and playing video games. Automobile racing games developed by Note On Valuation Of Venture Capital Deals Case Study Help can be a prospective source of acquiring attention of kids towards NASCAR track racing. NASCAR's digital functions related to kids are not capable of gaining the attention. NASCAR requires more attention towards personalizing and enhancing its digital features to bring in the kids target audience.

This big expenditure makes the section capacity for NASCAR marketing method of increasing its fan base. The market segment considers NASCAR as an organization lacking in creating a multiculturalism environment. NASCAR ought to take different steps to improve the experience of Generation Y customers in its occasions.

5 C's of Marketing

5 C's of marketing assists in taking choices relating to marketing. These 5 C's needs to be analysed properly for taking any marketing decision. These 5 C's stands for Climate, Company, Collaborators, Rivals and customers.

Climate/Context.

It needs to make PESTLE analysis in order to comprehend environment or context in which NASCAR is working. PESTLE stands for political, financial, social, technical, legal and ecological and is stated above.

Business.

NASCAR is a car racing business with having USP of high quality auto racing with a global structure. Its sector is sports team and occasions. Its target market is males in the age of 15-60 years. Business has closed corporate culture and having non-interventionist technique.

Collaborations.

Collaborations includes distributors, suppliers and alliances of NASCAR. NASCAR used to get pay check of around $15 million every year from Turner Sports. NASCAR had to get approval from Turner Sport if it want to develop its Facebook page, twitter account or even mobile application.

Customers.

The consumer of Note On Valuation Of Venture Capital Deals Case Study Solution are its viewers. They target consumers with having age of 15-60 years. Fan base of NASCAR comprised of married males with an average age of 47, which passes their fandom to their youngsters and develop generational loyalty.

Rivals.

The direct rivals of NASCAR are Formula 1 and Moto GP. Groups usually represents sponsors in NASCAR and the medium of marketing is drivers. Therefore it can be said that motorists and race vehicles are competitors. If they got better chance in terms of prizes and tv exposure, these drivers can go versus NASCAR.

Marketing Methods.

1. Establishing and Keeping Facebook Page.
Among the potential target markets sectors for NASCAR is Hispanics which is the growing population sector of USA however unfortunately NASCAR had been unable to bring in the this targeted segment. In order to bring in the young growing generation the NASCAR ought to market by using social networks like Facebook. It should develop a Facebook page consisting of the info relating to the races and the places of tracks to make the customer useful about the core operations of Note On Valuation Of Venture Capital Deals Case Study Help. It ought to likewise upgrade its Facebook page on daily basis to offer details about its upcoming events. This would make the target audience section more useful about business and would lead to bring in large fans base.
2. Establishing and Upgrading Accounts of Secret Drivers.
NASCAR motorists has a low star power as compare to gamers of other sports. Its ranks 7th in terms of star power (see Case Exhibit). The major reason behind it is that, the racers primarily play in teams and are not able to construct a key account and maintain a close contact with fans. The poor contacts with fans lead to less destination of viewers towards the racers and a low star power. Star power is an important element for attracting viewers towards tracks and towards tv. The star power for the drivers at NASCARA could be improved by creating and upgrading accounts of key motorists by NASCARA itself. This would eliminate the requirement of forcing drivers to maintain their accounts and would result in increasing fans attention towards NASCARA drivers.
3. Establishing New Games and enhancing present video games for kids.
In order to bring in these kids, NASCARA must enhance its existing racing video games by introducing customization in the automobiles i.e. altering colours, selection of speed, presenting group racing in the video game, utilizing much better graphics related to the racing tracks and introducing numerous levels in the game. All these modifications in the existing game would provide much better experience to kids.
Together with it, NASCAR must also develop brand-new video games associated with racing like kids racing with kids characters as drivers, cartoon racing with racing in between different animation characters with an option of choosing the preferred cartoon character for the kids. These techniques would allow the business to attract one of its potential target sections.
4. Introducing multiculturalism at events.
NASCAR occasions are comprised of fans with very few cultural variety, due to cost of arrival in events, making it unsightly for the customers viewing sport events as social celebrations i.e. Generation Y clients. As the Generation Y consumers are a prospective target market for NASCAR, therefore the business should take certain steps to attract this possible target market.
5. Improving Customer Experience at Tracks.
Due to the fact that on the race day viewers got disappointed, NASCAR must work on infrastructure and features at tracks. Viewers have many expectations from NASCAR due to the fact that in very same market other business are supplying much better services than NASCAR. Then its fans might moved to its rivals, if NASCAR don't work on this concern. According to fans there were not adequate centers were offered as compare to other sports companies. NASCAR needs to make sure that it supply sufficient centers that includes cleaned bathrooms, comfy seating plan. They should also offer WIFI services and accessibility of charge card throughout that track. It needs to be likewise make certain that there suffice jumbo turns put at all required locations. There should be likewise food stalls that offer quality food to viewers. In this way viewers will be having enjoyable experience at the day of event. (See Appendix B).
Marketing Budget.
Marketing budget made on the basis of the above techniques for the duration of 5 years from 2011 to 2015, reveals the expense related information for the marketing strategies. It can be seen that strategy 5 of improving consumer experience at tracks would require greatest initial financial investment and cost and technique 4 of introducing multiculturalism will need lowest preliminary financial investment with least expensive even more per year cost.
NOTE: The worths about expense are assumed on logical basis due the absence of truths and figures associated with cost in the event study. Inflation rate of United States is assumed to be 10%.

Recommendations.

On the basis of deep analysis of the external and internal elements of Note On Valuation Of Venture Capital Deals Case Study Analysis triggering the decrease of television viewership rate and participation rate at tracks, the above marketing methods are recommended to NASCAR to increase its fan base in long run. These strategies would deal with internal factors like poor customer experience at tracks, insufficient social networks marketing, incapable digital medias like video games, absence of culturalisms at tracks and so on, along with with external elements like shifting of fans towards other sports, demographical modifications in America and altering domesticity designs.

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