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Key Topics
- Requirement
- Solution
- Introduction
- Industry Trends
- Growth
- Profitability
- Market Segments Overall
- Industry information
- Competitors, Strengths and Weaknesses
- Primary Segment and Decision Making
- Major Market Segments
- Primary and Secondary Target Markets
- Competition
- Positioning Map for Organization
- Conclusion
- References
- Given below is the PESTLE Analysis:
Requirement
Carnegie Technologies
Assessment – 3: Market Segments and Decision Making
Solution
Introduction
Carnegie Technologies has been selected for the assessment. The company is into technological and communications products such as mobile devices, cellular core network operations, and others (About us, 2017). Some of the products of this company are Hi-Fi Voice, Bandwidth Aggregation, Wireless Access Manager, and others. The company is US based and has the potential to move into the international space with the technology. The market selected for the company is Australian Telecommunication Sector. The company is oriented towards serving the customers with the high speed access internet connections by leveraging on the available network from nearby phones. This paper is concerned with the market analysis for the company under various aspects.
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Industry Trends
The understanding of industry trends helps the company in forming appropriate decisions. There are various aspects that are looked upon while analysing the industry trends. This section has considered three areas, namely, growth, profitability, and factors associated with the PESTLE Analysis. PESTLE Analysis has been shown in the appendix. The PESTLE Analysis has covered the likely interventions that are expected for this company if it operates in Australia (Pattak, 2007). The economic situation has been studied that shows whether the people will be able to afford the service. The social aspect showed the orientation of the target customers. The technological aspects showed the presence of technology in the country and the orientation of the mass towards this. The legal and political factors cover the government orientation and supportive rules and regulations available. The sub-sections below cover the growth of the industry and whether it would be suitable for the company to enter, and whether the company will be able to attain expected profitability.
Growth
As per the survey conducted by Delloite, the mobile use in the Australian market is growing at an appreciable rate. At present, more than 80% of the people of Australia use smartphone which is an improvement by 10% in comparison to the last year. The country boasts of around 15 million smartphones in use. These 15 million are active phones and not those that have been used and trashed (Phipps et al, 2016). The Carnegie technologies can have good opportunity in this country as the market is already aware of the smartphones. The use of smartphones have gone so rampant that instead of people engaging with newspapers on the street, they can be seen glued to their phones. This provides an opportunity for the companies that are looking forward to increase the service usability of the smartphones through their creative mobile applications. ‘Carnegie technologies’ has developed few apps that it will market to the Australia which might be appreciated by these high rate mobile users.
Profitability
The profitability in this segment is good at present due to the high rate of smartphone use among the customers. If the mobile application is liked by the users, then it is likely that the company can gain appreciable profitability from the investment. The market of 80% mobile users is huge. As per the report, the app development market is going to reach $100 billion by the year 2020 at a global level. The Australian community is spending 37 hours a month fiddling with their phones and the forecasted growth for the revenue from the mobile app was $1.2 billion from the country (Mobile Consumer Survey, 2016). The substantial use of smartphones and applications require high quality mobile networks and this is where the companies like Carnegie Technologies can play its role. The total tablet sale reached 11.2 million in the year 2015 and the smartphone sale went to 15.3 million. These grew further in the next year and are expected to grow further with the promise of bringing more profitability to the existing and new players in the market.
Market Segments Overall
The market in which the company is entering consists of huge number of mobile developers. The following subsections reflect on the current industry and the existing competitors, their strengths and weaknesses. Also, the strengths and weaknesses of Carnegie Technologies have been considered to understand where it fits in the market.
Industry information
The mobile and tablet industry has grown outrageously in the country and so have the mobile and tablet applications. It has transformed into a multi-billion industry worldwide. The mobile application is being utilised by almost all the industries whether it is broadcast media or it is the companies that has just started its business. The mobile application market is booming and constantly creating job opportunities to lots of people. The Australian market is attracting businesses to the tune of millions of dollars. As per the IBISWorld Surveys, at present the Australian mobile application development market is crowded with more than 350 app development companies. The annual growth rate of this industry at present is estimated at 177 per cent (Mobile Consumer, 2015). The mobile and tablet application is being created in all the segments whether it is education, gaming, finance, maps, books, connectivity, video streaming, and others. It has led to the multitude of business opportunities for new and existing organizations. The entrepreneur present in the mobile application is from the variety of backgrounds such as software developer, marketing, venture capitalists, designing, and others. The mobile application development is diverse and businesses are being developed on the utilities that were non-existent few years ago. One of the examples is the purchase of ‘Chomp’ by the Apple. Chomp is a mobile app search engine, developed in Australia, which is now integrated with Apple app store and is used to search the entire store helping customers in easy access to desired app. Most of the businesses such as broadcasting media, offline sellers, and others are not viewing the application market as the new competition but the way to extend their market and cater to the new customer segment. This has given opportunities to the mobile app developers and they cater to these companies in building their mobile presence.
Competitors, Strengths and Weaknesses
There is limited competition in the segment this company is willing to enter. The reason is that the technology it will be bringing in the market has been patented and no one else can use this technology at present. However, there are other mobile applications that have been developed by the company that can be in the competition with the mobile developing companies such as Outware, Buzinga, Appfutura. These companies develop multiple mobile applications to cater to the growing demand of the market. However, there are no direct competitors to this company. The competition is mild in the segment company is entering. The company, with its good brand value, can gain market quickly. There are some smaller players in the market who are into the segment as same as this company to provide network convergence facilities but they are not successful enough due to the lack of solid technology at hand. The network analytics mobile applications exist in the market but they are not reliable enough and the customers are looking for the application that can display accurate data. The Network Quality Analytics and Advanced Call Diagnostics mobile application by the company is an appreciable effort to ward off the competition and build strong hold in the market. The company is also into cable operation and MVNOs which it can extend in the coming days if the current business succeeds in the Australian market.
Primary Segment and Decision Making
This section is concerned with understanding the market segment for the Carnegies Technologies. The company eyes for the various mobile users and has segmented the market as discussed in the sub-sections ahead.
Major Market Segments
The major market segment of the company is the smartphone industry. As stated earlier, the smartphone industry is huge and there is multitude of users engaged with the smartphones in some way or the other. The focus of the company is to target those smartphone users. The company has built various types of mobile application that works in conjunction with the mobile network and local Wifi to strengthen the network access for the users. The company believes that the market will prefer such technology that helps them get faster internet service and track their data consumption. The overall target market covers users of different age, economic level, and education level. The market is divided into various user types. Some of them are early adopters who will accept the technology as soon it launches in the market, whereas others will take some time in considering this new technology. The company will not face challenge in identifying the market segment as the presence of individuals on the online communities can be easily targeted by the company can their needs can be fulfilled. The mobile application users or the smartphone users range from various fields such as school and college going individuals, working class, retired individuals, working and non-working women, and others (Kotler et al, 2015). These segments have different characteristics. These customer markets have different needs. The working class and the students from schools and colleges spend some of their time in commuting while the other segments spend their time at one place. This can help the company decide which one to consider the primary target market for the mobile application and which one to consider the secondary.
Primary and Secondary Target Markets
The primary target market of the company is the daily commuters and travellers who travel places to places. These people face challenges in strong internet connection and, therefore face issue in enjoying the technology to its fullest. Therefore, the company will be advertising its mobile application to these customers. There are various applications from the company that can make the life of these primary consumers easier. For instance, the Hi-Fi Voice and Rich Messaging application will help the customers in making and receiving phone calls from wherever they want and they don’t have to keep multiple numbers for different locations. Another application, Bandwidth Aggregation, will help the customers in combining the Wi-Fi and mobile networks together and gives faster internet speeds and reliable service (Evensen et al, 2011). The customers can enjoy improved video streaming and conferencing. The secondary target markets are the individuals who are at the locations that receive limited network visibility and they face challenge in using internet effectively. These customers face similar problem in comparison to the primary. Only difference is that they remain static which will also help the company give better calibration with the local network and faster service.
Competition
The company is coming into the market with the patented technology and, therefore, considering this technology, currently there are no direct competitors for the company. Therefore, the company can efficiently enjoy the blue water strategy for the Australian market. The company has patented the technology used in the Bandwidth Aggregation. However, for other applications it has developed such as Hi-Fi Voice, Wireless Access Manager, and others, there are existing mobile applications at the local level that may pose some challenge. In such scenario, the company can built its brand to ward off the local minor competition and get ahead in the competition. Moreover, the competition can be handled by providing free and strong service in the beginning which can be extended in the future with the paid versions to gain the profitability.
Positioning Map for Organization
There are various mobile companies that are developing multitude of mobile applications to cater to the Australian market. Though there are no direct competitors for the Carnegie Technologies in the type of mobile application it is planning to market, yet it can be expected that the existing large scale developers might prefer to enter into this attractive segment. The diagram below shows the positioning map of the company by considering two factors, brand and price.
Conclusion
Overall, it can be stated that the Australian market is lucrative opportunity for the company to enter. The company should be entering into the market with the primary target in consideration. There are no direct competitions for the company at present which can be the golden opportunity to attract the customers. The only risky part in the business is whether the customers will prefer using the new technology that is being brought forth by the company. The use of technology such as connection aggregators are less preferred due to the perception of more battery consumption less usability. The company might have to work towards this direction to build its brand and position itself as per the diagram shown in the positioning map developed above. Moreover, there are high number of mobile phone users in the Australia (around 80%), which is likely to grow further in the days to come. This is the right time for the company to enter into the market as the customers must be looking for the network connections that can fulfil their easy access to the internet. It is obvious that the internet is where 37 per cent of the people of Australia can be found and, therefore, to keep their inertia intact, it is necessary to have a service that can help in getting faster internet connection. Carnegie Technology has the ability and technology to cater to such demand. This will help the company gain right profitability from the market after getting established brand presence in the market.
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About us. (2017). Carnegie Technologies. Retrieved 7 January 2017, from http://carnegietechnologies.com
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Brusse, C., Gardner, K., McAullay, D. and Dowden, M., 2014. Social media and mobile apps for health promotion in Australian indigenous populations: scoping review. Journal of medical Internet research, 16(12).
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Evensen, K., Petlund, A., Riiser, H., Vigmostad, P., Kaspar, D., Griwodz, C. and Halvorsen, P., 2011, June. Demo: quality-adaptive video streaming with dynamic bandwidth aggregation on roaming, multi-homed clients. In Proceedings of the 9th international conference on Mobile systems, applications, and services (pp. 355-356). ACM.
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Kotler, P., Burton, S., Deans, K., Brown, L. and Armstrong, G., 2015. Marketing. Pearson Higher Education AU.
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Mobile Consumer Survey 2015 | Deloitte Australia | TMT, mobile devices, social media, internet speed, online shopping. (2017). Deloitte Australia. Retrieved 7 January 2017, from https://www2.deloitte.com/au/en/pages/technology-media-and-telecommunications/articles/mobile-consumer-survey-2015.html
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Mobile Consumer Survey 2016 | Deloitte Australia | Technology, Media & Telecommunications report. (2017). Deloitte Australia. Retrieved 7 January 2017, from http://www.deloitte.com/au/mobileconsumer
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Pattak, D.C. (2007), An investigation into Nokia-Microsoft Strategic Alliance: Joining forces in the global Smartphone Industry.
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Phipps, L., Alvarez, V., de Freitas, S., Wong, K., Baker, M. and Pettit, J., 2016, October. Conserv-AR: A virtual and augmented reality mobile game to enhance students’ awareness of wildlife conservation in Western Australia. In Proceedings of the 15th World Conference on Mobile and Contextual Learning (mLearn 2016), Sydney (pp. 24-26).
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Appendix
Given below is the PESTLE Analysis:
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Political: The country is a federal constitutional monarchy. The country has witnessed stable government and, therefore, there are limited policy fluctuations. The companies operating in the country are expected to be equally oriented towards customers and profitability.
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Economic: The country has strong economy. The economy of the country kept growing consecutively for the 17 years until it got hit from the global financial crisis. The tax rates have been constant mostly which poses fewer challenges to the companies operating in the country.
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Social: The people of the country are tech-savvy and around 80% of the population is using phones. The people prefer to enjoy the technological development. This can be helpful for the companies that are innovative and prefer to bring new technologies on the table.
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Technological: The technological advancements are appreciable. Almost all the sectors of the country is utilizing the technology in some form or the other to complete their job with ease.
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Legal: There are no legal challenges that can hinder companies from operating in the country. The only pre-requisite is that the company considers ethics as its part and also work towards good future of the employees and the society.
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Environmental: The companies operating in the country are expected to be environmental conscious. Moreover, they are expected not doing things that can harm the environment and jeopardize the livelihood of local people in any form.
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