SYNOPSIS –TiVo
TiVo was founded by Jim Barton & Michael Ramsay with an idea to equip homes with a ‘home
network” that would integrate all household communication devices. TiVo unit was a set-top box
that interfaced between the broadcast feed and the television, inbuilt with the option of pausing
the TV, recording favourite programs and also rating them as per your liking such that TiVo
automatically recognised and recorder your favourite programs in case of available memory. It
was first of its Kind - Innovative and Revolutionary product in the television entertainment
space. Strategic tie ups with big corporations like Sony and Philips (Strength) – added credibility
to the product from customer point of view. The TV market in America was huge and TiVo
managed to set up very effective retail distribution and nationwide reach. TiVo got rave user
feedback from users of the product leading to high Customer Satisfaction. Also TiVo did not
involve any usage of CD’s and DVD’s required for back up – used hard disk space – and thus was
an efficient, hassle free technology. TiVo had many advantages, some of them were:
1. Customized program recording as per individual choices also based on this data TiVo
would self prompt similar programs and line up for recording
2. Thumbs and Thumbs down features that led to programming suggestions - Novel and
high involvement feature that hooked the viewer
3. Special features like - Online TV Guide, a Video Magazine, Record shows with a push of
single button
4. Reduced channel surfing
In spite of its ease of use envisioning the potential of the device was difficult for non users. Also
TiVo was priced too high as compared to competitor products with similar features. Also they
had a weak marketing strategy and restricted their promotional activities only to PR which led to
the lack of awareness of the product. Marketing at POP point of Purchase was challenging as
even the Sales personnel could not explain the product features clearly. The uncertainty of
product positioning was clearly visible in the Communications Campaign and also the weren’t
able to tackle competition well even in marketing communications
SWOT Analysis- TiVo
Strengths
Good referrals from current customers/ Good customer satisfaction.
Proper feedback mechanism.
First mover advantage
Co branding with Sony & Philips.
Nationwide sales ability/ Strong distribution.
Weaknesses
Knowledgability of salesman selling TiVo
High turnover of sales staff
Still an unknown product/ Restricted Promotional activities
0.4% penetration only in the U.S markets despite its availability in most major
consumers electronic stores across.
TiVo has a confusing product class/ not a very clear product differentiation.
Costs are still considered for most consumers/ too highly priced
Opportunities
Benefits with an aging and educational society/changing consumer attitudes
A growing demand in the market for the product/ huge captive market to tap.
TiVo could keep track of what shows were being watched and by how many, it could
also keep a track of the shows being recorded and all this data would help the
advertisers hence a good vertically integrated (forward) move.
TiVo is being sold in stores and on the internet nationwide.
Customer referrals.
Advertising through TiVo can be revolutionised by making it more targeted and
relevant
Tap the telescoping concept of Advertisements – Opt and view the commercial
relevant to the consumer.
Networks can use the TiVo data for launch strategy – Understand viewer
consumption and behaviour beforehand. Based on recording scheduling.
Threats
Brand & Category awareness negligible.
Changes in technology were slow.
Customers were unhappy and felt ‘Spied on’ when TiVo mapped their choices
according to the channels and movies they watched and pre-recorded it.
Competition within the product class - TiVo’s core business ideas was being used by
the major competitors like Microsoft who had come up with many economic and
additional plans to TiVo and other market competitors. E.g. – Replay TV, Prices from
$699 to $1999 & Recording time ranging from 40 hours to 320 hours
Trying to change consumption pattern of television built over 50 years a challenge –
Could be a huge challenge and the threat is that human behaviour takes a long time
to change.
No co-operation from Networks and Advertisers and they wanting to Sue or Buy out
TiVo.
Dropping of the price of the product from 999$ to 399$ could lead to losses.
Networks refusing to air the TiVo advertisements.
Submitted by:-
Preetha Iyer – 148
Renesha Vellala - 156
Rifath Aara - 158
Saurabh Jaiswal - 167
Shreyashi Das - 171
Sonal Bangia - 175
Sreeparna Maitra - 178
Arti Nagdeo - 198
