Progressive Insurance Case Study Solution and Analysis
Introduction
NASCAR (National Association for Stock Cars And Truck Car Racing) is an organization carrying out series of Stock Car racing in United States and acting as an approving body for driving the guidelines for Stock Vehicle Racing. 2) Stock Car Racing by NASCAR is the second largest spectator sport, with highest number of sponsors. 1) The other sources of revenue for Progressive Insurance Case Study Solution includes; 10% of the overall earnings from television rights, sanctioning fees i.e. $1-2 million per race, and licencing NASCAR brand to business.
NASCAR has a closed corporate culture with the non-interventionist method. This non collective method brings tensions in the sport. The building of Car of Tomorrow by Progressive Insurance Case Study Help, with an objective of safety for the motorists, brought numerous tensions among the stakeholders of the sport.
The interaction audit, conducted in 2010, revealed that in spite of the reality that business extremely depend on the interactions between its stakeholders, there was no recognizable service interaction strategy. The industry's target consumers, instructions and goals were all unidentified.
The audit pointed out various doing not have of NASCAR in terms of lack of internal integration, absence of fan management strategy and absence of digital and social media of marketing.
Progressive Insurance Case Study Analysis viewers was extremely devoted to the sport and the brand names associated with the NASCAR, making it appealing for sponsors and corporate online marketers.
Problem Statement.
The company is presently facing the problem of decreasing rates of participation at racing tracks and rates of tv viewers. This can put a significant effect on its revenues from sponsors, media rights, and from other sources of earnings.
Situational Analysis.
The company was rather effective till 2005 with its standard marketing methods, but quickly after 2005 the company begins dealing with different problems consisting of decline of its fan base. Numerous external in addition to internal factors are responsible for the decline. Internal aspects consist of; inadequate financial investment in social networks 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 children and create generational loyalty. Other difficulties for NASCAR 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, etc.
SWOT Analysis.
Strengths.
NASCAR core proficiencies includes it has rights of dictating rules as approving body. Guidelines and regulations concerning expert stock cars and truck racing are determined by NASCAR like if any group with needed skills and resources can enter into races by following rules and policies dictated by NASCAR. All the occasions of NASCAR are sponsored by corporates since of greatest brand loyalty of fans towards brand names advertised by Progressive Insurance Case Study Analysis.
Weak points.
Weak points of NASCAR includes its close culture which is non collaborative. Progressive Insurance Case Study Help develops Car of Tomorrow without cooperation so result is that motorists did not like that principle. It was also discovered that NASCAR had no efficient technique for company interaction.
Opportunities.
NASCAR generally used to rely on traditional media sources like regional paper for promotion of its sports. NASCAR likewise came to know from these conventional media outlets that sport was challenging to cover. When sports fans were asked concerning popular stars and stars then NASCAR driver was not discovered even in leading twenty actions.
Hazards
Dangers in SWOT analysis are defined as external elements that can risk to business's success. Due to the fact that if there is financial down turn then individuals would be having less return on investment, Economic down turn was experienced in late 2000 which can be threat for NASCAR. Earning of people would be effected and they would be more mindful in investing their cash. Economic down turn likewise leads to boost fuel prices which likewise impacted NASCAR. Due to the fact that fans of NASCAR used to attend its occasion from fars away. NESCAR had a guideline of 65/25/10 for revenue circulation. 65 percent earnings from media rights would be distributed to race course, 25 percent profits would be dispersed to contending group and remaining 10 percent would be kept by NESCAR which is approving body. Competing group wished to increase their part of profits from 25 percent because of boost in running cost of a race group and also there is decrease in the number of full-season sponsorship. NESCAR also deals with threats from other sponsors since they are making enormous investments to enhance experience of fans. For example which includes updating existing avenues, developing brand-new avenues, supplying Wi-Fi center and also supplying other interactive mediums to communicate sports on smartphones. 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. So the difficulty is that the household system in America was altering resulting in reduction of influence of married male fan base over their children. In addition to it understandings about car was likewise altering with viewing vehicle a vehicle to reach at point B from point A, rather than as a fun project. If NASCAR make substantial investments in brand-new segments which are based on brand-new consumers then it might deal with unfavorable remarks from its core fan base, now.
Porter's 5 Forces Analysis
Porter's 5 forces is a model that is used to evaluate industry in which company is working. It helps in determining what are strengths and weak point of any specific market. It recommend that every market is different from one another. Because NASCAR's bottom line i.e. net revenue is greatly depends on this, it is essential to understand industry in which business is working. There are 5 forces that are utilized to determine success, intensity and beauty of Progressive Insurance Case Study Analysis business.
Competitive Competition
This force indicates ability of rivals. Teams normally represents sponsors in NASCAR and the medium of marketing is motorists. Therefore it can be said that chauffeurs and race vehicles are competitors. These chauffeurs can break NASCAR if they improved chance in terms of prizes and television direct exposure. If viewers delight in other race cars and trucks and drivers more than NASCAR then viewers can move to those other intriguing vehicles and chauffeurs. NASCAR could be having hazard from its 2 direct rivals that is Solution 1 and Moto GP. They require to develop competitive advantages for motorists so they do not shift to other competitors.
Provider Power
If business shifts from one provider to another, the supplier power shows the number of providers are offered in market and what is the cost associated with provider. Due to the fact that motorists with required resources and abilities are limited, in this market there is supply monopoly.
Purchaser Power
In the case of NASCAR consumers are its viewers. Audiences can switch to other rivals quickly since audiences will having low switching cost.
Risk of Substitution
Substitutes are referred as options. The replacements in this case can be other home entertainment indicates like viewers can move to other sports. There are wide variety of replacements are available in this situation which suggests that threat of replacement is high.
Danger of New Entry
In the case of NASCAR hazard of brand-new entry is low. They need to build cars and trucks and racing tracks and also needs to pay substantial amount to motorists for changing.
PESTEL Analysis
Political
It can not be concluded from case research study that there would be modification in resource allotments. NASCAR had actually got gain from lower tax policies which results in increasing in profits. So they made heavy investments in the research and development. As NASCAR is operating in numerous markets so it needs to deal with various policies. It is also kept in mind that Progressive Insurance Case Study Solution has dealt with increased examination concerning regulatory. Every government has various concern so NASCAR has to be prepared for it as concern can be moved to other sector.
Affordable
Financial aspects consists of taxation rate, exchange rate, financial performance of that specific business, conditions of labour market, inflation rate and so on. Fortunes of the NASCAR and its competitors can be impacted if there is federal government intervention in the marketing and sales sector. NASCAR can take advantage of capabilities of workers to produce new chances and enhance existing chances.
Social
Each has different social values and standards. It helps in comprehending regarding society and choice of consumers.
Technical
Technology has impact on practically every service. It includes development in service method. In this case of Progressive Insurance Case Study Solution it can be kept in mind that companies are greatly spending for research study and development. NASCAR must likewise work on its media rights policy with Turner Broadcasting System.
Legal
Due to the fact that every country has various legal terms and conditions, Legal plays an important role in every country. Progressive Insurance Case Study Solution needs to be make sure that they secure their legal rights in every county so any company does not hurt to its legal rights.
Environmental
Ecological elements are also crucial for each business. Since typically federal governments don't allow those organisation which can hurt to environment. These ecological aspects consists of laws regarding contamination, environment modification, safe garbage disposal, policies regarding insurance and so on. NASCAR needs to make sure that its cars are not creating pollution more than appropriate level.
7 P's of Marketing
Product
The items of Progressive Insurance Case Study Solution in its product portfolio are; racing occasions tickets, racing tracks, sponsor's marketing, media rights, licencing NASCAR brand name, approving guidelines for races and ad-space to business marketers throughout broadcast of NASCAR races. (Hanlon, 2018).
Price.
Rates technique of NASCAR for its race occasions tickets is based upon the place and value of the racing occasions. In addition to race occasions tickets, NASCAR also charge numerous service fees to its stakeholders and makes income. For instance it charged approving costs of $1-2 million per race typically in 2005.
Promotion.
Marketing technique of Progressive Insurance Case Study Analysis is extremely based upon its fan base. A strong fan base share its fandom with others and increase the number of viewers for NASCAR races. The company is not completely relied upon its fan base for its promotion and promote through regional radio stations too. The business has likewise adopted the retailing media of promo, in which the business offers merchandises with its logo.
Location.
NASCAR have its racing tracks in various cities in United States. The most essential tracks of NASCAR consists of Atlanta Motor Speedway in Georgia, Auto Club Speedway in California and Darlington Raceway in South Carolina. It tries to conduct its races in most of the cities in United States to comprehend across the country appeal.
People.
Nestle individuals technique is consisted of offering better experience to its audiences, its fan base and to all of its stakeholders. People are an essential aspect of Progressive Insurance Case Study Help A marketing technique as its events are the source of home entertainment for crowd. Its people strategy includes efforts to provide much better experience to its Fans, Race Drivers, Team, Event Organizers etc., all of which come under people technique of NASCAR.
Procedures.
A number of company procedures are required to conduct racing events in an efficient way. These procedures include; appropriate schedule of time, arrangement for viewers, selling tickets, arrangement of area for sponsors, managing logistics and so on. These all procedures contribute I developing NASCAR image, enhancing viewers experience and increasing fan base.
Physical Proof.
Most important physical proofs for the NASCAR consists of the presence of its racing tracks, stock automobiles and racing occasions. In addition to it, its merchandising brands including tee shirts, caps, goodies etc., also function as a physical evidence for NASCAR.
Product Life Cycle Evaluation.
The racing events by NASCAR was presented on June 19, 1949. At the very first stage competition for NASCAR was low, as the competitors drove the automobiles similar to the automobiles driven by regular individuals.
Development.
After conducting its first race effectively the company moved towards developing its own tracks. The very first Progressive Insurance Case Study Help based track, namely 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 development of racing tracks the business moved towards broadcasting its races on television in 1979. The very first occasion relayed on television was flag-to-flag coverage of Daytona.
In 1972, William France Jr., became the president of NASCAR and n about 3 decades, he changed NASCAR from a regional Sport popular organization into one with worldwide fan base. He started a brand-new age of financially rewarding sponsorships and television contracts for NASCAR.
Maturity.
The maturity duration for NASCAR began with the efforts of William France Jr., with the business having large range of income sources. The business has about 500 sponsors with transmitting its occasions in about 150 countries. The business has a great deal of tracks in most of the cities of United States.
Decline.
The significant causes of decline include the financial crisis of 2008, which increased the cost of showing up at tracks for audiences due to increasing fuel prices, and the moving of its fan base towards other sports.
Market Segmentation.
The marketplace division of Progressive Insurance Case Study Analysis can be divided into four segments; Geographic, Demographic, Psychographic and Behavioural. (Dutta, 2018).
Geographical.
The geographical division of Progressive Insurance Case Solution is based upon the geographical presence of its tracks in numerous states and cities in United States, and the television broadcasting of its occasions in various nations. The business has 23 tracks in about 20 states of America and has television broadcast through numerous Medias i.e. TNT, ESPN, ABC and Fox, in about 150 countries.This huge geographical division provides the business regional as well as global fan base.
Market.
The group division of Progressive Insurance Case Study Help 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 techniques to draw in more age groups and lower its costs to enter in the market sector with a low typical income.
Psychographic.
The psychological attributes of the majority of the fans are quite comparable. NASCAR has a fan base with a commitment. NASCAR fans view it compulsive to purchase tickets and see the races as soon as in a week. 71% of them choose to acquire items with a NASCAR brand. They are rather extrovert and are willing to mingle with other fans while racing. They want quality racing with low cost at practical place. Although Progressive Insurance Case Study Help has attempted to increase the quality of its racing by presenting phase racing, they also have tried to lower rates and make the event easier by presenting live racing.
Behavioural.
Behavioural segmentation of NASCAR is based upon the behaviour of fans in terms of viewing the race live on the television or by going in the events. Presently, the fans preference is towards viewing the race at house on television rather than going, as the client experience at NASCAR tracks is not favourable as well as expensive.
Target audience.
Hispanics.
One of the potential target market of Progressive Insurance Case Study Analysis was Hispanics; the young and growing population of United States. The marketplace section has terrific possible for NASCAR as the population was growing at a greater rate and it was expected to end up being thrice after forty years and the section has increasing wealth rate with about $1 trillion of wealth in 2014. Although, the section reveals affinity with vehicle culture, but need a more concentrated marketing towards inviting the section towards racing.
Kids.
Kids are likewise one of the potential target audience sector for NASCAR, as they are more linked socially than other groups. Creating fan base among kids can supply a possible boost in the variety of fans for racing due to their connection. Kids invest most of their times in utilizing mobile phones and playing computer game. Automobile racing video games developed by Progressive Insurance Case Study Solution can be a potential source of acquiring attention of kids towards NASCAR track racing. Nevertheless, NASCAR's digital functions connected to kids are not efficient in acquiring the attention. NASCAR requires more attention towards personalizing and improving its digital functions to attract the kids target audience.
This substantial expense makes the segment capacity for NASCAR marketing technique of increasing its fan base. The market segment thinks about NASCAR as a company lacking in creating a multiculturalism environment. NASCAR ought to take various actions to improve the experience of Generation Y customers in its events.
5 C's of Marketing
5 C's of marketing assists in taking decisions concerning marketing.
Climate/Context.
It requires to make PESTLE analysis in order to comprehend climate or context in which NASCAR is working. PESTLE stands for political, financial, social, technical, legal and environmental and is mentioned above.
Company.
NASCAR is a vehicle racing business with having USP of high quality vehicle racing with a global structure. Its sector is sports group and occasions. Its target market is males in the age of 15-60 years. Business has actually closed corporate culture and having non-interventionist approach.
Cooperations.
Collaborations includes 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 want to create its Facebook page, twitter account or even mobile application.
Customers.
The customer of Progressive Insurance Case Study Analysis are its audiences. 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 produce generational loyalty.
Competitors.
Teams generally represents sponsors in NASCAR and the medium of advertising is chauffeurs. These motorists can go against NASCAR if they got better opportunity in terms of prizes and tv direct exposure.
Marketing Methods.
1. Establishing and Maintaining Facebook Page.
One of the potential target audience segments for NASCAR is Hispanics which is the growing population segment of U.S.A. however regrettably NASCAR had been not able to bring in the this targeted sector. In order to bring in the young growing generation the NASCAR should market by utilizing social networks like Facebook. It should establish a Facebook page including the info concerning the races and the locations of tracks to make the customer informative about the core operations of Progressive Insurance Case Study Help. It must likewise upgrade its Facebook page on day-to-day basis to provide info about its approaching occasions. This would make the target audience sector more informative about business and would lead to attracting large fans base.
2. Establishing and Updating Accounts of Secret Drivers.
Progressive Insurance Case Study Analysis chauffeurs has a low star power as compare to gamers of other sports. The poor contacts with fans result in less attraction of viewers towards the racers and a low star power. Star power is an important element for bring in audiences towards tracks and towards television.
3. Developing New Games and improving current video games for kids.
Kids invested the majority of their time on playing video games and utilizing smart devices. But regrettably, kids playing NASCARA have a worst experience of playing its video games. As a result, they are less drawn in towards the sport. In order to draw in these kids, NASCARA should improve its present racing games by presenting modification in the cars and trucks i.e. changing colours, selection of speed, presenting group racing in the game, using better graphics related to the racing tracks and presenting different levels in the game. All these adjustments in the present video game would provide much better experience to kids.
Together with it, NASCAR needs to likewise build brand-new games related to racing like kids racing with kids characters as chauffeurs, cartoon racing with racing between various cartoon characters with a choice of selecting the preferred cartoon character for the kids. These methods would enable the company to draw in one of its possible target segments.
4. Introducing multiculturalism at events.
NASCAR occasions are made up of fans with really few cultural variety, due to cost of arrival in occasions, making it unappealing for the customers perceiving sport events as social occasions i.e. Generation Y clients. As the Generation Y consumers are a prospective target market for NASCAR, therefore the business ought to take certain procedures to attract this potential target market.
5. Improving Customer Experience at Tracks.
NASCAR ought to work on infrastructure and facilities at tracks because on the race day viewers got dissatisfied. Viewers have numerous expectations from Progressive Insurance Case Study Analysis since in same industry other companies are supplying better services than NASCAR. IF NASCAR don't work on this problem then its fans might shifted to its competitors.
Marketing Budget
Marketing budget plan made on the basis of the above methods for the duration of 5 years from 2011 to 2015, shows the cost associated information for the marketing methods. It can be seen that technique 5 of improving customer experience at tracks would need greatest initial investment and expense and strategy 4 of introducing multiculturalism will require least expensive preliminary investment with most affordable even more per year cost.
NOTE: The worths about expense are presumed on rational basis due the absence of realities and figures connected to cost in the case study. Inflation rate of United States is presumed to be 10%.
Recommendations.
On the basis of deep analysis of the internal and external factors of Progressive Insurance Case Study Analysis causing the decrease of tv viewership rate and attendance rate at tracks, the above marketing methods are advised to NASCAR to increase its fan base in long run. These strategies would cope with internal aspects like poor consumer experience at tracks, insufficient social networks marketing, incapable digital medias like games, absence of culturalisms at tracks etc., along with with external elements like moving of fans towards other sports, demographical modifications in America and altering family life styles.
