Note On Valuation Of Venture Capital Deals Case Study Solution and Analysis
Note On Valuation Of Venture Capital Deals Case Study Analysis (National Association for Stock Cars And Truck Auto Racing) is an organization performing series of Stock Cars and truck racing in United States and functioning as an approving body for driving the rules for Stock Automobile Racing. The organization was established in 1947, by "Big Bill" France. NASCAR organize Stock Automobile Racing occasions in United States with the existence of about 130000 audiences usually in 2005. It also broadcast its events in about 150 countries. Stock Cars And Truck Racing by NASCAR is the second biggest viewer sport, with highest number of sponsors. It has about 500 sponsors contributing billions of dollars in its revenue. The other sources of income for Note On Valuation Of Venture Capital Deals Case Study Solution consists of; 10% of the total profits from television rights, approving costs i.e. $1-2 million per race, and licencing NASCAR brand name to companies.
NASCAR has a closed business culture with the non-interventionist technique. The building of Cars and truck of Tomorrow by NASCAR, with an intent of security for the motorists, brought various tensions among the stakeholders of the sport.
The communication audit, conducted in 2010, revealed that despite the reality that the business highly rely on the communications in between its stakeholders, there was no identifiable company interaction strategy. The market's target customers, instructions and objectives were all unknown.
The audit pointed out different doing not have of NASCAR in regards to lack of internal combination, absence of fan management method and absence of social and digital media of marketing. The company has intricate ecosystem with independent tracks, groups and motorists. This structure with closed corporate culture bring various obstacles in speeding up a modification. Other partners in community includes the media networks i.e. tv and radio, and business online marketers.
Note On Valuation Of Venture Capital Deals Case Study Analysis audiences was extremely loyal to the sport and the brands connected with the NASCAR, making it appealing for sponsors and corporate marketers.
The business is currently dealing with the problem of declining rates of participation at racing tracks and rates of television audiences. This can put a considerable influence on its earnings from sponsors, media rights, and from other sources of revenue.
Although the business was rather successful till 2005 with its traditional marketing techniques, however not long after 2005 the company begins dealing with numerous problems consisting of decline of its fan base. A number of external along with internal elements are responsible for the decline. Internal elements include; inadequate financial investment in social networks 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 youngsters and create generational commitment. However the household system in America was altering resulting in reduction of influence of married male fan base over their youngsters. Together with it perceptions about cars and truck was likewise changing with viewing vehicle a lorry to reach at point B from point A, instead of as a fun job. Other obstacles for Note On Valuation Of Venture Capital Deals Case Study Analysis consists of 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 difficulties were tending the business to revise its marketing strategies.
In SWOT analysis, strengths defined as company's qualities which are different from its rivals. These are business's core proficiencies on which business efficiency or business success based on. Note On Valuation Of Venture Capital Deals Case Study Solution core proficiencies includes it has rights of determining guidelines as sanctioning body. Rules and policies relating to expert stock automobile racing are dictated by NASCAR like if any group with needed skills and resources can participate in races by following guidelines and policies dictated by NASCAR. NASCAR has monopoly it this element. Its strengths also 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 relay in more than 150 nations worldwide with more than $56 million incomes. The main sources of their incomes originate from tv rights, sanctioning charges, sponsorship and licensing. It has longest season of 10 months and having ownership of 3 nationwide series i.e. Outdoor camping World Truck Series, the Sprint Cup Series and the Nationwide Series. It has also big resource of fans and business sponsors. Because of greatest brand commitment of fans toward brands advertised by NASCAR, all the events of NASCAR are sponsored by corporates. (See Appendix A).
Weak Points in SWOT Analysis are thought about as external elements. Weaknesses includes the aspects that stops company to carry out at needed level of effectiveness. Weak points of NASCAR includes its close culture which is non collaborative. They have non-interventionist approach. They normally utilized to form rules and other needed procedures without intervention of others which results in poor collaboration. NASCAR establishes Automobile of Tomorrow without cooperation so result is that motorists did not like that principle. As this is racing sport so covering of sports by media is likewise tough. It was also found that NASCAR had no reliable technique for business interaction. If it occurred off track, they don't understand how to handle problem. Inadequate organisation interaction results in that they don't have clear direction for their long term goals. They don't understand that where they want to see this sport in future.
Opportunities in SWOT analysis are external factors which can be favourable to business or the external factors on which company is having competitive benefit. NASCAR generally used to count on conventional media sources like local paper for publicity of its sports. Typically these traditional media sources try to cover their home team and specific sort of occasions. NASCAR also came to know from these standard media outlets that sport was tough to cover. Media landscape likewise changed from standard to digital landscape. Newspapers failed. NASCAR can work on its capabilities to get maximum possible gain from this new digital landscape. NASCAR have underinvestment in digital resources. So it can capitalize in digital and social media to get its advantages. Digital rights of NASCAR were also sold to Turner Sports. NASCAR utilized to make money check of around $15 million annually from Turner Sports. There are variety of cons behind this offer. NASCAR had to get approval from Turner Sport if it want to create its Facebook page, twitter account or even mobile application. Turner Sport also had rights of every video which is shoot throughout race at track. Then they are needed to pay licensing costs to Turner Sport, if media sources like papers, magazines and cable television channels want to publish videos of races on their particular pages. So NASCAR can deal with conditions and try to work out with Turner Sports to get maximum benefits of it. Star power plays very essential role in producing incomes from every sport. It was noted that NASCAR is lagging in this area i.e. star power. When sports fans were asked concerning popular celebs and stars then NASCAR driver was not discovered even in leading twenty reactions. So NASCAR can put efforts in this area too for revenue generation. They must assist their chauffeurs that how they can end up being sport stars. 4 tactical focuses which are created by research study team can also be served as chance for NESCAR. These four strategic focuses compares and analysis Note On Valuation Of Venture Capital Deals Case Study Solution techniques.
Threats in SWOT analysis are specified as external aspects that can risk to company's success. Economic down turn was experienced in late 2000 which can be risk for NASCAR since if there is financial down turn then people would be having less return on investment. Earning of people would be effected and they would be more mindful in investing their cash. Economic down turn likewise results in boost fuel prices which likewise impacted NASCAR. Because fans of NASCAR utilized to attend its event from fars away. NESCAR had a rule of 65/25/10 for income distribution. 65 percent profits from media rights would be dispersed to race tracks, 25 percent income would be distributed to competing group and remaining 10 percent would be retained by NESCAR which is sanctioning body. Completing team wanted to increase their part of revenue from 25 percent due to the fact that of boost in running cost of a race team and likewise there is decrease in the number of full-season sponsorship. Due to the fact that they are making massive investments to enhance experience of fans, nescar likewise deals with dangers from other sponsors. For example that includes updating existing avenues, building brand-new avenues, offering Wi-Fi center and also offering other interactive mediums to engage sports on mobile phones. Fan base of NASCAR consisted of married males with a typical age of 47, which passes their fandom to their children and produce generational loyalty. So the difficulty is that the family system in America was changing resulting in decrease of influence of married male fan base over their children. Together with it perceptions about cars and truck was likewise changing with viewing automobile an automobile to reach at point B from point A, instead of as a fun job. If NASCAR make substantial investments in brand-new sectors which are based on brand-new consumers then it might deal with negative comments from its core fan base, now.
Porter's Five Forces Analysis
Porter's 5 forces is a model that is utilized to evaluate market in which company is working. It helps in determining what are strengths and weakness of any particular market. It suggest that every market is different from one another. It is important to understand market in which company is working since NASCAR's bottom line i.e. net revenue is greatly depends on this. There are 5 forces that are used to determine success, strength and beauty of Note On Valuation Of Venture Capital Deals Case Study Help service.
These motorists can go versus NASCAR if they got better chance in terms of rewards and television exposure. If viewers enjoy other race cars and chauffeurs more than NASCAR then audiences can shift to those other intriguing cars and trucks and motorists. NASCAR might be having risk from its 2 direct competitors that is Formula 1 and Moto GP.
The provider power indicates the variety of suppliers are readily available in market and what is the expense connected with provider if business shifts from one provider to another. Because drivers with needed resources and abilities are limited, in this industry there is supply monopoly.
This force is concerning to consumers that is it easy for customers to shift to other products. Then consumers are less likely to switch, if there is more switching expense is associated. In the case of NASCAR consumers are its audiences. Audiences can switch to other competitors quickly because viewers will having low switching cost.
Hazard of Substitution
Alternatives are referred as options. The substitutes in this case can be other home entertainment suggests like audiences can shift to other sports. So there are vast array of replacements are offered in this circumstance which suggests that threat of alternative is high.
Danger of New Entry
In the case of NASCAR threat of brand-new entry is low. They require to develop vehicles and racing tracks and likewise requires to pay hefty amount to chauffeurs for switching.
As NASCAR is working in various markets so it needs to face various regulations. It is also noted that NASCAR has dealt with increased examination concerning regulative. Every government has different concern so NASCAR has to be prepared for it as priority can be shifted to other sector.
Financial aspects includes tax rate, exchange rate, economic efficiency of that particular business, 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 workers to create new opportunities and enhance existing opportunities.
Every society is different from each other. Each has various social values and standards. It helps in understanding relating to society and choice of clients. Social aspects includes customs, culture, attitudes towards particular services and products, demographics, standards, interests and so on. It can be concluded that marketing through other ways rather than conventional (i.e. paper) can be chosen in this society.
Innovation has impact on almost every service. It includes innovation in company strategy. In this case of Note On Valuation Of Venture Capital Deals Case Study Solution it can be noted that business are heavily investing for research study and development. NASCAR ought to likewise work on its media rights policy with Turner Broadcasting System.
Legal plays an important function in every country due to the fact that every country has various legal terms and conditions. Note On Valuation Of Venture Capital Deals Case Study Help needs to be ensure that they protect their legal rights in every county so any company does not hurt to its legal rights.
Environmental aspects are likewise crucial for each company. Since usually governments don't enable those business which can harm to environment. These environmental elements includes laws regarding pollution, environment modification, safe garbage disposal, policies relating to insurance and so on. NASCAR requires to make sure that its cars are not creating pollution more than acceptable level.
7 P's of Marketing
The products of Note On Valuation Of Venture Capital Deals Case Study Analysis in its item portfolio are; racing occasions tickets, racing tracks, sponsor's marketing, media rights, licencing NASCAR brand name, sanctioning rules for races and ad-space to business online marketers throughout broadcast of NASCAR races. (Hanlon, 2018).
Pricing method of NASCAR for its race occasions tickets is based upon the location and significance of the racing events. Along with race events tickets, NASCAR also charge various service fees to its stakeholders and earns profits. For example it charged approving costs of $1-2 million per race on average in 2005.
Promotional technique of Note On Valuation Of Venture Capital Deals Case Study Analysis is extremely based upon its fan base. A strong fan base share its fandom with others and increase the number of audiences for NASCAR races. However, the business is not completely trusted its fan base for its promo and promote through regional radio stations too. The company has actually also embraced the merchandising media of promotion, in which the business sells products with its logo design.
NASCAR have its racing tracks in different 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 tries to conduct its races in the majority of the cities in United States to comprehend across the country appeal.
Nestle people technique is comprised of offering much better experience to its audiences, its fan base and to all of its stakeholders. People are an essential element of Note On Valuation Of Venture Capital Deals Case Study Help A marketing technique as its events are the source of entertainment for crowd. Its people method consists of efforts to supply better experience to its Fans, Race Drivers, Crew, Event Organizers etc., all of which come under people method of NASCAR.
Numerous business processes are needed to perform racing occasions in an efficient method. These processes consist of; correct schedule of time, plan for spectators, selling tickets, arrangement of space for sponsors, handling logistics etc. These all processes contribute I developing NASCAR image, improving spectators experience and increasing fan base.
Crucial physical proofs for the NASCAR includes the presence of its racing tracks, stock vehicles and racing occasions. Along with it, its retailing brands including t-shirts, caps, goodies and so on, likewise act as a physical evidence for NASCAR.
Item Life Cycle Evaluation.
The racing events by NASCAR was presented on June 19, 1949. At the first stage competitors for NASCAR was low, as the rivals drove the cars comparable to the automobiles driven by regular individuals.
After performing its first race successfully the business moved towards developing its own tracks. The first Note On Valuation Of Venture Capital Deals Case Study Solution based track, specifically the Darlington Raceway track, was started in 1950 in South Carolina. It was followed by establishment of more raceways including Daytona International Speedway, which was opened in 1959. After the development of racing tracks the business moved towards transmitting its races on tv in 1979. The very first occasion transmitted on television was flag-to-flag protection of Daytona.
In 1972, William France Jr., ended up being the president of NASCAR and n about 3 decades, he changed NASCAR from a regional Sport popular company into one with worldwide fan base. He started a brand-new age of financially rewarding sponsorships and television agreements for NASCAR.
The maturity duration for NASCAR began with the efforts of William France Jr., with the company having wide variety of earnings sources. The company has about 500 sponsors with transmitting its events in about 150 countries. The company has a great deal of tracks in most of the cities of United States.
The significant causes of decrease include the monetary crisis of 2008, which increased the cost of showing up at tracks for audiences due to increasing fuel rates, and the shifting of its fan base towards other sports.
The market segmentation of Note On Valuation Of Venture Capital Deals Case Study Solution can be divided into 4 sectors; Geographic, Demographic, Psychographic and Behavioural. (Dutta, 2018).
The geographical segmentation of Note On Valuation Of Venture Capital Deals Case Help is based upon the geographical presence of its tracks in different states and cities in United States, and the television broadcasting of its events in numerous countries. The company has 23 tracks in about 20 states of America and has television broadcast through various Medias i.e. TNT, ESPN, ABC and Fox, in about 150 countries.This huge geographical segmentation offers the company regional in addition to worldwide fan base.
The demographic division of NASCAR is also highlydiverse based upon the gender, earnings and age of the consumer. Its current fan base is majorly consisted of male married fans with a typical age of 47 years and an income around $30-50 thousands. Currently NASCAR is trying to increase its target market to the young growing population and kinds. To increase the group section of its market NASCAR need to revise its marketing methods to attract more age and lower its prices to go into in the market section with a low typical earnings.( htt1).
The mental characteristics of most of the fans are quite comparable. NASCAR has a fan base with a loyalty. When in a week, NASCAR fans view it compulsive to buy tickets and see the races. 71% of them choose to purchase products with a NASCAR trademark name. They are rather extrovert and are willing to mingle with other fans while racing. They want quality racing with low rate at convenient place. NASCAR has actually attempted to increase the quality of its racing by introducing stage racing, they likewise have attempted to lower rates and make the occasion more convenient by introducing live racing.
Behavioural division of NASCAR is based upon the behaviour of fans in terms of seeing the race live on the tv or by going in the events. Currently, the fans choice is towards viewing the race at house on tv rather than going, as the client experience at NASCAR tracks is not beneficial as well as costly.
Among the potential target market of Note On Valuation Of Venture Capital Deals Case Study Analysis was Hispanics; the young and growing population of United States. The marketplace section has excellent possible for NASCAR as the population was growing at a higher rate and it was expected to end up being thrice after forty years and the segment has increasing wealth rate with about $1 trillion of wealth in 2014. The section reveals affinity with automobile culture, however need a more focused marketing towards welcoming the sector towards racing.
Kids are likewise one of the prospective target market section for NASCAR, as they are more connected socially than other groups. Cars and truck racing video games established by Note On Valuation Of Venture Capital Deals Case Study Solution can be a possible source of getting attention of kids towards NASCAR track racing. NASCAR needs more attention towards customizing and enhancing its digital functions to bring in the kids target market.
This substantial expense makes the segment potential for NASCAR marketing method of increasing its fan base. The market segment thinks about NASCAR as an organization doing not have in developing a multiculturalism environment. NASCAR ought to take different 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 relating to marketing.
It requires to make PESTLE analysis in order to comprehend environment or context in which NASCAR is working. PESTLE represents political, financial, social, technical, legal and environmental and is stated above.
NASCAR is a vehicle racing company with having USP of high quality car racing with a global structure. Its sector is sports group and occasions. Its target audience is males in the age group of 15-60 years. Company has closed corporate culture and having non-interventionist technique.
Collaborations consists of distributors, providers and alliances of NASCAR. NASCAR utilized to get pay check of around $15 million yearly from Turner Sports. NASCAR had to get approval from Turner Sport if it want to produce its Facebook page, twitter account or even mobile application.
The consumer of Note On Valuation Of Venture Capital Deals Case Study Help are its viewers. They target customers with having age of 15-60 years. Fan base of NASCAR comprised of married males with a typical age of 47, which passes their fandom to their children and develop generational commitment.
The direct competitors of NASCAR are Formula 1 and Moto GP. Groups generally represents sponsors in NASCAR and the medium of advertising is drivers. It can be stated that chauffeurs and race vehicles are rivals. These motorists can break Note On Valuation Of Venture Capital Deals Case Study Help if they got better chance in regards to rewards and television direct exposure.
1. Developing and Keeping Facebook Page.
One of the potential target markets segments for NASCAR is Hispanics which is the growing population segment of USA but unfortunately NASCAR had actually been not able to attract the this targeted sector. It ought to establish a Facebook page containing the info regarding the races and the locations of tracks to make the consumer useful about the core operations of NASCAR.
2. Establishing and Updating Accounts of Key Drivers.
NASCAR motorists has a low star power as compare to gamers of other sports. Its ranks 7th in regards to star power (see Case Exhibition). The major reason behind it is that, the racers mainly play in teams and are unable to develop a key account and preserve a close contact with fans. The bad contacts with fans lead to less tourist attraction of audiences towards the racers and a low star power. Star power is an essential element for bring in audiences towards tracks and towards tv. The star power for the chauffeurs at NASCARA could be enhanced by creating and upgrading accounts of key motorists by NASCARA itself. This would eliminate the requirement of requiring chauffeurs to keep their accounts and would lead to increasing fans attention towards NASCARA chauffeurs.
3. Developing New Games and enhancing existing games for kids.
Kids invested the majority of their time on playing video games and using mobile phones. But sadly, kids playing NASCARA have a worst experience of playing its games. As a result, they are less brought in towards the sport. In order to attract these kids, NASCARA must improve its current racing video games by introducing personalization in the automobiles i.e. altering colours, selection of speed, introducing group racing in the game, utilizing better graphics related to the racing tracks and presenting different levels in the game. All these modifications in the existing video game would supply better experience to kids.
Together with it, NASCAR needs to also construct brand-new games connected to racing like kids racing with kids characters as chauffeurs, animation racing with racing between various animation characters with an option of picking the preferred cartoon character for the kids. These strategies would enable the company to draw in among its potential target sectors.
4. Introducing multiculturalism at events.
NASCAR events are comprised of fans with extremely few cultural diversity, due to cost of arrival in occasions, making it unattractive for the consumers perceiving sport events as social celebrations i.e. Generation Y customers. As the Generation Y consumers are a possible target market for NASCAR, for that reason the company needs to take specific steps to attract this potential target market.
5. Improving Consumer Experience at Tracks.
Because on the race day viewers got disappointed, NASCAR needs to work on infrastructure and features at tracks. Because in very same industry other business are supplying better services than NASCAR, viewers have many expectations from Note On Valuation Of Venture Capital Deals Case Study Analysis. Then its fans may shifted to its rivals, if NASCAR don't work on this issue. According to fans there were not adequate centers were available as compare to other sports companies. NASCAR should make sure that it provide adequate facilities that includes cleaned up bathrooms, comfy seating plan. They ought to also provide WIFI services and ease of access of charge card throughout that track. It needs to be also ensure that there suffice jumbo turns placed at all needed locations. There ought to be likewise food stalls that provide quality food to viewers. In this method audiences will be having pleasant experience at the day of event. (See Appendix B).
Marketing Budget 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 related information for the marketing methods. It can be seen that strategy 5 of enhancing client experience at tracks would need greatest preliminary financial investment and cost and technique 4 of introducing multiculturalism will require most affordable preliminary investment with least expensive even more per year cost.
NOTE: The values about expense are presumed on logical basis due the absence of truths and figures associated with cost in the event study. Inflation rate of United States is presumed to be 10%.
On the basis of deep analysis of the external and internal aspects of Note On Valuation Of Venture Capital Deals Case Study Help causing the decrease of television viewership rate and presence rate at tracks, the above marketing strategies are suggested to NASCAR to increase its fan base in long run. These strategies would deal with internal elements like poor client experience at tracks, inadequate social media marketing, incapable digital medias like games, lack of culturalisms at tracks and so on, in addition to with external aspects like shifting of fans towards other sports, demographical changes in America and changing domesticity styles.