Tom Tom case Swot Analysis

Tom Tom Case

Strengths
Technology, large customer base, distribution power, & prominent brand image. Vision is to improve people’s lives. Vision has helped company be a market leader.
Advances in better maps by maintaining high quality map data base that is constantly kept up to date by large community of active users who provide corrections, verifications and updates to Tom Tom. Has world’s largest historical speed profile data base. Has unique real time traffic information service which provides users with high quality, real time traffic updates.
Brandt loyalty due to its patents on great technology (barriers to entry)
Trusted brand (3 out of 4 people are aware of the brand of the TomTom business across the markets)
Weaknesses
Only holds 24% of markets share while competitor Garmin holds 45% (Rivalry among established companies)
Revenues from Europe and North American are on the decline.
TomTom’s strategy targeted customer who were early adopters, but now navigation industry went from embryonic to growth industry, and since its current customers are early majority, simplicity and ease alone could not longer provide it with competitive advantage. (Traditionally high quality and ease of use of solutions have been of utmost importance to TomTom)
Has 1,006 million Euros in debt due to acquisition of TeleAtlas. Cost reductions: redction of staff, which is core capability for technology company. Reducing can hinder future innovative projects. (innovation and change) Reduction of market expenditure hinder growth opportunity because there are still 65% of US adults who do not own any sort of navigation system or even that of a phone.
Lacks business to customer approach for marketing
Dependency on the network of connected driving community
Opportunities
Creating digital maps for developing countries (first mover advantage) (global forces)
Creating a product or software that hides PND from would be thieves and deter them from trying to steal one.
Sociocultural Segment: (Green Movement) TomTom can solicit business by advertising its technology as the smarter more environmentally safe tool if driving is absolutely necessary. Was pioneer in introducing different technologies that help drivers make their journeys safer and more economical
Threats
Declining industry:
Risk of entry by potential competitors (substitute products): cell phones, online navigation applications
Competition from cell phones & other smart phones
Changes in macro environment( built in car gps has become more mainstream in even mid to lower tier vehicles)
Government Regulations: possible legislative banning of all navigational devices from automobiles. Auto break ins due to visibility of PND docking stations. Restrictions of certain capabilities of TomTom devices due to security and terrorism concerns. Ex. Egypt