FINAL PROJECT

JOIN THE PLAYERS

AMERICAN UNIVERISTY IN BULGARIA
INTERNATIONAL STRATEGIC MANAGEMENT AND POLICY
PROFESSOR: VENETA ANDONOVA
Spring 2!"
by Denis Burtaev


Contents
1.Michael Porters five forces analysis of the industry .................................................................... 2
1.1 Rivalry .................................................................................................................................... 2
1.2 Buyers Bargaining Power ..................................................................................................... 2
1.3 Barriers to entry ...................................................................................................................... 3
1.4 Bargaining power of suppliers ............................................................................................... 3
1.5 hreat of su!stitutes ............................................................................................................... 3
2."pportunities for coopetition ........................................................................................................ 3
3.#o$e challenges ............................................................................................................................ 4
4.%$portant aspect of &oin the Players value proposition ................................................................ 4
5.'oes it travel internationally( ....................................................................................................... 4
5.1 Proposed solution 1 ................................................................................................................ 4
5.2 Proposed solution 2 ................................................................................................................ 4
).*reating *o$petitive +dvantage ................................................................................................. 4
,.he !est approach to reach paying clients .................................................................................... 5
-.*o$$unicating .alue Proposition to *usto$ers ........................................................................ ,
/. *ost leadership ............................................................................................................................ ,
10.1a$!ric2 3 4redric2son Model ................................................................................................. ,
10.1 +renas .................................................................................................................................. ,
10.2 .ehicles ............................................................................................................................... ,
10.3 'ifferentiators ...................................................................................................................... ,
10.4 #taging ................................................................................................................................. ,
10.5 5cono$ic 6ogic .................................................................................................................. -
11. 7e8t 'ecision .......................................................................................................................... -
9or2s cited ...................................................................................................................................... -
#ugars: Brad. ;he 4astest 9ay to 4ind 7ew *usto$ers< 5ntrepreneur.
http=>>www.entrepreneur.co$>article>1-5--0 .................................................................................. /
1. Michael Porters five forces analysis of the industry
United States Soccer Federation governs all levels of soccer in the country including
national, professional and amateur leagues. With 26 million and still growing number of
practitioners, soccer is the third most practiced team sport in the US.
There are three different inds! regular field, indoor and beach soccer played in the US
soccer industry. "ll the three inds of amateur soccer leagues in United States are sanctioned by
US Soccer Federation but governed by United States "dult Soccer "ssociation #US"S"$.
US"S" has %& state organi'ations including amateur regional and amateur national leagues.
US"S" is affiliate with (remier )evelopment *eague, the +ational (remier Soccer *eague and
Women,s (remiere Soccer *eague which promote higher level of amateur competitions. US"S"
is the largest amateur adult soccer organi'ation in the soccer industry of United States. Factors
such as demographics, location, competitions, insurance coverage, image or fame of the team
and buyer,s power have a significant impact on the profitability of the teams and leagues in the
industry.
-ichael (orter,s five forces analysis illustrates how five prominent forces! .$ /ivalry, 2$
0argaining power of buyer,s, 1$ Threats to entry &$ 0argaining power of suppliers and %$ Threats
of substitutes impact the attractiveness of the industry.
1.1 Rivalry
a$ +umber of competitors. There is a large number of competing teams in every region
within the industry. This stimulates the rivalry because more teams compete for the same number
of customers within the specific region.
b$ Switching costs. 2ustomers or players of the teams in the industry have a range from
moderate to high level of switching costs. Factors such as the location of the field, insurance and
the level of organi'ation, specifically coaching, games and competitions, and the strength of the
team in general have a great impact on customers switching costs. This on one hand stimulates
rivalry in terms of having better coaching, e3uipment and better location and on the other hand
gives some level of power to the players.
c? )ifferentiation. 4n terms of differentiation, teams attract players by service differentiation
mainly5 i.e. how e6perienced coach is, how professional the practices are, how often games are
and additional services such as insurance, medical, physical and nutritional consultation.
Therefore, considering these factors, the differentiation level is also moderate5 because, it
depends from state to state5 demography and sponsorship of the teams. For e6ample, teams from
the eastern coast of the country are more service differentiated than -idwest region.
d$ 2apacity increase. The capacity degree in terms of practices is different from team to
team. The capacity of games played is fi6ed and regulated by US"S". 4t also depends on the
strength of the team, its losses and wins during the season. Therefore, rivalry is high.
e$ )iversity among competitors. There is no single team in the industry that can influence
the degree of rivalry significantly. 4n the aspect, the rivalry level is low.
4n conclusion, the rivalry level of soccer industry in US is moderate.
1.2 Buyers Bargaining Power
a$ 2oncentrated buyers. The concentration of buyers depends on the number of games
played. This number of games is determined by wins and losses in a tournament of teams, so
customers themselves, i.e. if a team loses twice in the tournament they are out of the tournament.
Therefore, buyer,s bargaining power in this dimension is low.
b$ 2ost structure of the buyer. The cost structure includes sun cost, gears and uniforms if
bought, fi6ed fees for monthly practices, and additional fees for e6tra services such as insurance,
medical and physical if supplied, as well as fees for the games, tournaments and cups the teams
will be playing in. "ll the fees are regulated by soccer state organi'ation and US"S" e6cept the
gear costs. Therefore, the bargaining power is moderate.
c$ )ifferentiation. "s it has been already discussed above, the differentiation in this industry
involves services such as coaching sill level, difficulty of designed practices, plus additional
services lie insurance, medical, physical, and nutritional consultation. Thus, in differentiation
customer,s bargaining power is moderate.
d$ Switching costs. Switching costs from one team to another team can be high considering
factors such as location, services provided and fees to be paid. Therefore, the bargaining power is
low.
e? 7ertical 4ntegration. 7ertical integration in this industry means that buyers can organi'e
their own games outside of organi'ations and associations. This can include only field and
transportation fee for a player. 8owever, there is no high competition lie in organi'ed
tournaments and no recognitions such as certified cups, medals and honors which players
initially play for. Therefore, the bargaining power or buyers is low.
f$ 2ost structure of the supplier. The players have moderate nowledge on appro6imate
costs of a game. 8owever, it is ignored or disregarded. This diminishes the level of bargaining
power of customers.
2oncluding from the aspects discussed above, the customer,s bargaining power is in the
range of low to moderate because, the value of practices, nowledge, games and tournaments are
higher.
1.3 Barriers to entry
a$ 9conomies of scale. There is no mass production in this industry but there are fi6ed costs.
:nly fi6ed costs in this industry are a field rent or maintenance in case of ownership, coaching
salary, and games and tournaments fee if included in the amount of monthly fees. These fees can
be distributed to the number of players in the team. "s a result, entrants do not re3uire entering
with big investment into the industry. Thus, in this dimension the barriers to entry is not high and
threat to the entry is high.
b$ Switching costs. )ue to the number of competitors in region and moderate switching
costs discussed above #service differentiation$ the level of barriers to entry is moderate. +ew
entrants can enter the maret but the success and the number of customers they will have depend
on their uni3ue service offerings such as better coaching, or better insurance and others.
c$ 2apital re3uirements. 4n order to enter soccer industry, entrants will need somewhat
significant capital to ac3uire re3uired e3uipment to play and practice soccer, buy or rent a field,
and buy re3uired insurance services. 8owever, prices will depend on a region in the country.
Therefore, barriers to entry in this case are moderate.
d? (roduct differentiation. 96isting teams already have e6perience, image and contacts in
the industry for organi'ing games. 4n addition, the incumbents already now how to differentiate
and what services to offer to the customers which increase the added value. Thus, new entrants
will have to discover uni3ue service differentiation or offer higher service 3uality such as
coaching from famous coach or competing in higher level competitions to pass the high barrier
to entry.
"s a result, it can be said that the barrier to entry is moderate.
1.4 Bargaining power of suppliers
US are famous for its sports and athletic product companies. -ost of the suppliers are not
highly concentrated on supplying one product. 0ecause, sports, in general, is very popular in the
country, and suppliers strive to gain maret share in various inds of sports for bigger profit.
Soccer, as mentioned before, is the third most practiced sport in US". Therefore, there are a big
number of suppliers which provides more options to the soccer teams and organi'ations. 4n
addition, these suppliers can also sponsor the teams and provide e3uipment and gears for
mareting purposes. Thus, we can conclude that supplier,s bargaining power is low in this
industry.
1.5 Threat of substitutes
+umber of substitutes. Soccer is the third most played team sports in amateur sports industry.
4n the first place baseball second is basetball then followed by soccer. )espite these two
substitutes, there are number of other substitutes to soccer such as "merican football, rugby,
volleyball, softball, and even new inds of team sports lie ;uidditch from 8arry (otter #adapted
by -iddlebury 2ollege students in 2<<% and are now played at more than 1<< universities and
high schools in the United States and a do'en other countries.$ The intensity of these substitutes
depends on the season of the year, overall people,s preference and innovation of other types of
team games. "lthough there are large number of substitutes, most of the players do not restrain
themselves with only one ind of team sport. (eople who play basetball can also be playing
soccer. Therefore, the level of threat of substitutes is in the range of moderate to high.
"s a result, from the analysis of (orter,s five forces model, we can conclude that the soccer
industry is somewhat attractive.
2. Opportunities for coopetition
:pportunities for coopetition in the industry do not really e6ist. 2ustomers choose the teams
and clubs according to the some criteria lie location of the field, strength of the team=club,
insurance, additional services provided, games and tournaments played, fees and others. There is
no win>win situation5 because, either that customer plays for this club or not. Therefore, the
rivalry is high. 8owever, there can be cooperation between clubs to organi'e friendly matches
and play in various regional tournaments.
The entrance to the US maret in video recording the amateur soccer games loos very
challenging, as there already e6ists a large pool of companies which are active in this industry.
8owever, in assessing the switching costs of customers to using ?@oin the (layersA to record a
game, we discover that customers can have huge cost reductions. For e6ample comparing, the
cost table of ?Boin the playersA to the ones of the )igital Treasure 7ideo, we can see huge
difference.
Table 1
Digital Treasure Video Join the Players
Live Video Coverage! C22%.<< per gameD 2urrently not providing
Video Editing! CE%.<< per hour 2urrently not providing
DVD Copies! CF.F% each 2urrently not providing
Video Donload! C&.F% per download
2an download for free
Online Video Vieing! F/99 2<lv #.< 9U/:$ per game
!D Video "vaila#le at an "dditional $ee
"ll videos are 8) by default
"s seen from above the difference is obvious. :f course, the rates are not adBusted to the
US marets but still comparing how many divisions in costs "merican company has and how
simple one cost structure @oin the (layers has, one can conclude that the company can have a
competitive edge in cost savings. This is the most significant advantage this company has over
others.
%. &o'e challenges
8owever, despite the cost saving advantage, ?@oin the (layersA can face numerous problems.
The first problem is that this company uses cameras similar to the G: (/: cameras. G: (/:
cameras are small, durable cameras that practitioners of sports can tae them with and attach it to
themselves or the e3uipment they use to record a video. They are user friendly and do not re3uire
much technical nowledge. Second problem is that, @oin the (layers record only %6% and 666
player soccer games. This means that they do not record regular big field soccer games.
Therefore, they are limited to mini, indoor and beach soccer games.
(. )'portant aspect of *oin the Players value proposition
Football in 0ulgaria has a long way to go in order to achieve valuable results and reclaim
world,s recognition as of .FF& World 2up. :ne of the maBor aspects on which @oin the (layers
team has to focus on is to stress the contribution it can provide to the development of the
0ulgarian professional football as a whole. "lthough good for gaining popularity, @oin the
players should not limit its activities to providing services to mini>soccer amateur teams.
4n the case of amateur teams, @oin the players should focus on one of the ?main desires of
any sportsmen H the desire to become better.A
1
9ven if team plays for pleasure purposes only, its
1aylor: &i$. @Psychology oday@ Sports: What Motivates Athletes?
?ultimate goal is the pleasure of winning the game.A
2
4n order to improve its results, team has to
watch and analy'e the activity of each player on a regular basis. )uring the usual training
sessions when a team is preparing for the coming tournament, ?some of the mistaes can be left
unseen because of the human error factorA
3
8owever, because of the services offered by @oin the
(layers, the human error factor can be minimi'ed if not totally eliminated. "fter it is over, each
game can be carefully analy'ed with players, mistaes being uncovered and communicated to the
team. With mistaes being communicated to the players and the team,s desire to win, the
performance of the football team will inevitable improve.
"ddressing the desire of improvement represents one of the ways to approach amateur as
well as professional football teams in 0ulgaria and all over the world. "nother concept that is
?partially more suitable for addressing amateur teams that play for pleasure purposes only is
represented by the word H memories.A
4
For professional teams money is one of mundane stimuli
towards winning the match. 8owever, if a team is not one of the ?big arenaA players, money is
not really seen as a stimulus towards winning the tournament. For such teams, ?the pure
perception of being victorious serves as good>enough stimuli towards winning the game.A
5

(eople in these teams would crave for their victory to be recorded. The mistaes committed
during the game or the prospect of improvement will not be that important to such people. For
them it will be all about the pleasant memories. 9very person has some amusing memories that
are being recalled by this person from time to time. 8aving one of those memories recorded and
being able to see and relive those moments of Boy would serve as a good reason for such people
to be interested in buying the service offered by @oin the (layers.
+. Does it travel internationally,
2aylor: &i$. @Psychology oday@ Sports: What Motivates Athletes?
3#hu!ni2ov: 7i2ita. @#port.@ The mistakes of the football referees
46u2iyantseva: Mariya. @"ratorica.@ The psychology of the football
5#oro2in: +ndrey. @he will towards the victory.@ Power in football
(rofessional football teams as well as football teams that play for pleasure purposes are
present all over the world. -oreover, ?lust for pleasant impressions and the desire of self
improvement are two universal human aspirationsA on which the value proposition of @oin the
(layers is based on.
)
These factors will ensure the value proposition of @oin the (layers to travel
well internationally.
96porting the model to the US" could represent a serious challenge to @oin the (layers.
"ccording to F4F",s world ranings national team of US" is raned .&>th and national team of
0ulgaria is on 6E>th place.
,
"s ?US" supports an image of the result oriented environmentA, it
will be difficult to persuade professional and amateur US" football communities to use the
technological methods of the country whose national team raning is far below the raning of
their national team.
-
93uivalent logic is used in case of mini soccer teams. Unless the technology
provided by @oin the (layers will contribute to drastic improvement of their performance, US"
soccer community would not tae it into account. "nother problem with going into the U.S.
maret directly is that it is saturated with a similar technology.
5.1 Propose solution 1
:ne way to solve this problem would be convincing the national team of 0ulgaria to employ
the technology provided by @oin the (layers. -oreover, for advertising purposes, @oin the (layers
would most probably need to provide the team with free hardware and software e3uipment.
8owever, that would only lay the ground to the ne6t step. " noticeable raise in F4F",s world
ranings of a team that uses the technology of @oin the players would serve as an important
argument in convincing US" football community to employ this technology. This raise would
serve as a clear proof that the technology provided by @oin the (layers contributed to the
improvement of 0ulgarian national team playing level. This way of solving the problem is based
mostly on the performance of the team and could re3uire a long period of time before the team
)aylor: &i$. @Psychology oday@ Sports: What Motivates Athletes?
,Arin!erg: #a$uel. @4%4+>*ocaB*ola 9orld Ran2ing.@ Fifa
-#andell: Michael. @#occer in the C#+.@ History of soccer
achieves any raise in world,s raning. 8owever, providing the national football team with a free
service in e6change for a promise of mentioning @oin the (layers technology as a ey factor in
case of the team,s success is a fair price to pay.
8owever, 0ulgarian national team raise in ranings due to the usage of @oin the (layers,
services, will not serve as a good enough reason for U.S. football communities to employ the
?technology that is fairly developed in U.S. maret as well.A
/
Therefore, in order to gain the
interest of the U.S. maret, the company has to differentiate itself by providing an e6tra value to
the already e6isting technology.
Whether mini>soccer or regular football, professional or amateur leagues ?history of football
contains numerous cases of when the decisions of referees did not coincide with what was
actually occurring on the game field.A
10
Whether those referees did not properly see what was
happening in the process of the game or interpreted it wrongly, it resulted in maBor dissatisfaction
and complains from both spectators and members of the teams. ?Some of those decisions have
swung World 2up tournament outcomesA and leaded to severe violence from the part of the fans
or players themselves.
11
Therefore, in order to eliminate the possibility of human error and the
need for referees, @oin the (layers could introduce a computer based program that would
implement the functions of referees through the usage of their cameras. The program should
contain all the rules of the game that would be enforced by the computer. To ensure the fair
interpretation of the game more than 2 cameras per stadium would have to be installed.
-oreover, eliminating the possibility of human error by discarding the referees would offer a
twofold advantage! assuring the game process to become fairer and more appealing to U.S.
maret in terms of safety precautions. With the computer program Budging the process of the
game, the possibility of a referee being biased towards a team is e6cluded from the picture.
Therefore, with no room for referee human mistaes, the outcome of any game will be based
/.eneto2lis: *laire. @Ao Pro.@ The sprea of the technology
10#oro2in: +ndrey. @he will towards the victory.@ Power in football
116u2iyantseva: Mariya. @"ratorica.@ The psychology of the football
solely on the teams, performance. Subse3uently, spectators will have fewer reasons to argue
about the game process and this, in turn, will decrease the possibility of fight breaing out
between rival fans. The development and patenting this ind of computer program will both
differentiate the company from its competitors and create a barrier to imitation.
5.2 Propose solution 2
"lternative way of solving the problem of e6porting the model to the US" would be directly
contacting leading professional and amateur football clubs #lie US"S"$ of +orth "merica
and offering them service on more favorable conditions than the companies that are already in
the U.S. "t first glance, the noticeable difference in prices between services provided by @oin the
(layer,s and services that companies that already operate in US" provide would represent this
favorable condition. 8owever, in order to compete with these companies on a fair basis, @oin the
(layers will have to dramatically increase the 3uality of their service. 2ompanies that operate in
U.S. maret established their prices on reasonable 3uality to price ratio. "ll their recordings can
be compared to well>made modern action movies with a large budget. "t the same time, footages
made by @oin the (layers represent ordinary video recordings taen from two locations on the
different sides of the field. This location of the cameras does not allow for showing the events
happening on the field to the full e6tend. The technology of @oin the (layers can be compared
with 2) versus 1) technology that companies in the U.S. offer to their clients. The upgrade to
the level of the companies on the U.S maret would result in an essential increase of the price of
@oin the (layer,s service. 2onse3uently, competing solely on the price basis seems to be an
almost impossible tas to implement and would probably bring a much lower profit then the
option with adding value to the service provided. -oreover, choosing this option poses a serious
threat to the business as a whole. 8istorically, ?United States was much more technologically
advanced than 0ulgaria.A
12
(enetrating the U.S. maret without a distinctive feature that
differentiates you from the already established competitors that provide similar service would
most probably result in a dead end scenario. 4n other words, going there without a computer
program that represents their sustainable competitor advantage will not result in any positive
outcomes for the company. -oreover, if @oin the (layers decides to create such a program and go
12.eneto2lis: *laire. @Ao Pro.@ The sprea of the technology
to U.S. maret without this program being fully developed and thoroughly tested, they ris
losing their early bird advantage.
4n case the idea of @oin the (layers will provide the teams who employ its technology with
enhanced fairness of the game, decreased conflicts and improvement of the overall performance
level of the players, U.S. maret will try to put the company out of business by rapidly imitating
company,s idea. 4n order to decrease the possibility of this outcome, the company should delay
entering the U.S. maret until it fully develops in its national area. :nly after establishing strong
relations with its software=hardware providers, eliminating all the problems connected with the
installation process and gaining valuable nowledge about computer program,s overall
performance should the company e6pands in US".
-. Creating Co'petitive "dvantage
4n order to turn their early mover advantage into a sustainable competitive advantage, the
company should accumulate the e6perience that can be gained by solving problems that arise
during the course of its e6istence in 0ulgaria. "s it is among the first companies in 0ulgaria to
start with this type of business, a sustainable competitive advantage can be created by simply
following the regular course of its development. 0y establishing strong relationships with its
suppliers the company will be able to push prices down as the time passes. With almost no
competitors, the rivalry is low and company,s name will become recogni'able in the recent
future. -oreover, because of the lac of the competitors the concept of price wars is laying in the
distant future. 4f the real competition arises later on, the company will already have an
opportunity to decrease its costs by applying economies of scale. "fterwards, while being fully
prepared to answer any 3uestion and solve any problem connected to its service the company can
actually enter the U.S. maret. 8aving an answer to everything connected to their service would
decrease the lielihood of the customers seeing answers from their competitors. -oreover,
developing similar computer programs and learning how to solve all the problems connected
with their usage will re3uire a great amount of time from their direct U.S. competitors. This time
should be enough for the company to mae its brand name to be recogni'able, build a good
reputation and obtain maret share necessary for supporting of sustainable competitive
advantage.
Top national football clubs using @oin the (layers, services would definitely have a positive
impact on the sales of this technology to amateur football and mini>soccer teams both in 0ulgaria
and US". -oreover, targeting the football community ?pyramidA from top to bottom seems a
much more time efficient way than the other way around. ?Top national teams as well as the
games they play are always widely watched and discussed.A
13
The fact that such a team employs
the services of @oin the (layers that provide more value than similar services in US". will be
nown in no time. 4n addition to a free advertisement of their product and the e6tra value
provided by it, the company would receive numerous in3uiries from the fans of the football team
who are into amateur sports themselves. Following this scenario the sales of the product
throughout the country would syrocet and the company would eventually become a famous
brand with worldwide recognition.
/. 0he #est approach to reach paying clients
There are many traditional ways of reaching paying clients!
.. "dvertising via local and regional press
2. (utting up eye>catching promotional messages
3. 9ncourage word>of>mouth recommendations
4. :ffer free samples at local events
5. 2onsider Boining online business networing sites
These ways of reaching paying clients usually wor. They are good but not the best methods.
Traditional strategies lie networing and mailings will do the Bob, but they wonIt do the best
Bob.
14
For a startup, the fastest way to get the paying clients is ?a method that involves forming
Jhost>beneficiaryJ relationships with established businesses that cater to a target audience similar
to yours. Then you promote yourself to their database with a special offer presented as a gift
from the older business.A
15
The advantage of such approach is that ?@oin the playersA can use the
13Mills: Devin. @#portsnation.@ !ltimate Stanings
14http=>>www.$ar2etingdonut.co.u2>$ar2eting>sales>salesBleadBgeneration>tenBwaysBtoBapproachBnewBcusto$ers
15http=>>www.entrepreneur.co$>article>1-5--0
e6cellence achieved by many years of wor by the established business. The established business
will agree to let you use their database because it is a way for them to reward the customers
without taing any additional cost. This way ?@oin the playersA will gain new customers while
the host business is gaining reputation.
To successfully use this techni3ue ?@oin the playersA has to find appropriate partners, the
ones that would add ma6imum value to its start>up business. Such partners could be mini soccer
fields, organi'ations dealing with mini soccer tournaments, youth soccer comple6es, etc. *et,s
consider mini soccer fields, case. ?@oin the playersA would give free videotaping sessions to
customers that visit a particular field on a constant basis. "fter trying the video>solutions,
customers would love the service and start paying for it. To customers that are really e6cited
about it, the soccer field service and the video>solution might be sold as a bundle. For a field in
0lagoevgrad, the owner charges about &< lv per hour, videotaping session would cost another 2<
lv, considering that .2 players are on the field, it would cost about % lv per person. " soccer field
serves around &%>%< teams per wee. 9ven if out of %< teams that got free videotaping sessions,
%<K percent come bac for another session, ?@oin the playersA would mae %<< lv per wee on a
single field. :ur start>up would continue concluding such contracts with new soccer fields.
8ost>beneficiary mareting is actually a simple and relatively ine6pensive process that will
deliver solid results. There are four steps to be successful.
First, precisely define your target audience. J-en of age between .L and %%J might be a start.
2reate a detailed profile of your target customer. The more segments you can identify, the more
potential hosts you can approach. We must determine that the soccer field has customers that are
liely to visit it again, customers that have certain ambitions lie improving sills or winning
some ind of tournaments.
Second, identify local businesses that serve the same maret segments. Those are as already
mentioned soccer fields, tournaments organi'ers and others. 4n addition, we have to identify our
competitors. When ased for competitors, the co>founder of ?@oin the playersA replied! ?We have
only one team that is maing something similar #that we now of$ i/ewind.A 8owever, i/ewind
is Swiss based company that has not reached 0ulgaria yet. 4t does not cause threat of rivalry.
Third, pitch the plan, highlighting the benefits to the host business. 9mphasi'e that itIs a way
for the established business to reward their customers at no e6pense and with virtually no effort.
*ocal soccer fields would welcome our start>up also because of its innovativeness and customer
attraction.
Fourth, develop a strategy to convert redeemers to repeat customers. This is your long>term
goal. 0y giving away first video>shooting sessions for free, ?@oin the playersA will be able to
browse and lure soccer players to use video>solutions. "nd once they try most of them will love
it. 8owever, our start>up has to go with the times by innovating and surprising customers with
new finding = technologies. 4t must use innovativeness as a competitive advantage. "nd
sustainability of such advantage will depend on their ability to learn = adapt new technologies.
The ?host>beneficiaryA method is one of the most effective ways to 3uicly attract a critical
mass of 3ualified customers to a start>up. Using this method, ?@oin the playersA can tap into a
targeted group of consumers to Bumpstart sales. ?@oin the playersA is building its business on the
success of another entrepreneur who has spent years building a solid customer base. ?4n many
ways, this eliminates the need to reinvent the wheel.A
1)
Table 2
1)http=>>www.entrepreneur.co$>article>1-5--0
1 2a'e Location E'ail address Phone nu'#er
.
0ricell Soccer
/oof Top
&&& 0ricell "ve 2nd
floor -iami, F* 11.1.
infoMsoccerooftop.com N. #1<%$ F6E>1%.2
2 )owntown Soccer
&&& +W %th Street,
-iami, F* 11.&6
infoMdowntownsoccermiami.com N. #1<%$ L<L>FFFE
1 Soccer Town
.1L. +W .2Fth "ve,
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3. Co''unicating Value Proposition to Custo'ers
The value proposition can be communicated to the list of customers we have identified. Table
2 lists .< customers with their location, email address and phone number. "ll of them are from
the same maret segment which is mini soccer field accommodating games for .<>.& players.
There are still a couple of segments that are reasonable to research! soccer tournament
organi'ers, youth soccer comple6es. Those .< soccer fields are located in Florida (Exhibit 1).
The reason for choosing Florida is, first of all, absence of seasonality due to the stable weather.
Second, entering one state of the US at a time would be less costly for ?@oin the playersA H less
travelling and mareting cost. "nd Florida loos most promising in terms of demand for soccer
related products. "s previously mentioned the selected soccer fields will play the role of host
business. With their help ?@oin the playersA will have access to customers. :nce deals are
concluded with field owners, it will be much easier to sell the products. "s "nton Tsenov
mentioned they will charge the soccer field owners or certain leagues that in turn will charge the
players. So the field owners have to be convinced of benefits they are gaining by letting our
startup to be on their fields. We can communicate them via email address or phone number that
we already have. They will observe value of the solution while first video>shootings that are free
of charge.
4. Cost leadership
2ost leadership strategy will perfectly wor for @oin the players. 4t offers the almost same
level of client satisfaction as its international rivals. 8owever, to implement a cost leadership
strategy, it has to offer the same product and have lower cost of production.
4t has to grow big enough in 0ulgaria to be able to scale down its operations.
Strive for utili'ing all of its available capacity. Their cameras has to be employed E days
per wee 2& hours each day
Utili'ing full capacity will help staff learn fast. Their e6perience curve would be very
steep.
9fficiency of internal process should be improved by having fre3uent training seminars,
communicating new findings, listening to problems of employees and give them feedbac.
4nputs price are e6ogenous because it cannot influence high tech manufacturers for now
15. !a'#ric6 7 $redric6son Model
1!.1 "renas
?@oin the playersA is a start>up that provides video>solutions. 2ustomers get full video
recording of the match in 8) 3uality captured by two cameras above each goal from the best
angle. 4n addition, the product includes highlights of the best moments during the match. The
highlights are 2>1 minutes video consisting of best goals e6cluding blurred part of the match. The
advantage of such product is that it lets players analy'e games and improve themselves both
individually and as a team. "nother advantage is an opportunity to watch the games of rival
teams, learn their playing style and be ahead of them. 2urrently, ?@oin the players ?operates
within the 0ulgarian maret. 4n the future, the start>up is planning to e6pand to larger marets,
i.e. US". "U0G team had 3uestions related to e6pansion plans. ?@oin the playersA said! JWe
have thought about e6panding, but we want to stabili'e the solution here #in 0ulgaria$ first, and
when we start e6panding to be completely ready.A
1,
The company has targeted amateur soccer
players. There are two reasons for that. First, amateur soccer is not perceived as serious maret
segment for most of the sophisticated video>solution companies. Thus ?@oin the playersA is one
of the first movers into the maret segment. Second, there are many already e6isting well
established companies that serve professional soccer matches. 8ence, entering that maret
segment is very e6pensive. Therefore, the start>up is serving mini soccer fields designed for five>
to>five or si6>to>si6 players. Such mini fields are less costly in terms of need for technological
solutions, i.e. small number of cameras.
1!.2 #ehi$les
" maBor vehicle for achieving ?@oin the playersA presence in the selected arena is to be
committed to internal development of video>solution products via new generations of leading>
edge systems. 4s also has to enter into strategic alliances with the leading mini soccer fields and
organi'ers of amateur soccer tournaments. ?@oin the playersA would provide technologically
advanced products letting competing soccer teams watch each other,s games and learn from their
mistaes. The customers would tae the lead in mareting because ?word of mouthA is an
effective advertising tool.
1!.3 %ifferentiators
?@oin the playersA would use its leading>edge technology to develop superior video>solution
products, which the company would further advertise through online tools. These tools could be
its own website, social networs such as Faceboo, Qoutube, etc. "s previously mentioned,
?word of mouthA would play its crucial role in delivering the message of the company to the
customers. -oreover, the start>up would maintain close relationships with team leaders
#captains$ and coordinate the array of services it offers to each client. 4n addition, the customers
would be offered a very low price and on>time reliability. When ased about the price of their
service, the start>up replied! ?2urrently our starting price is 2<lv #.< euro$ per game, but it
depends on the number of games we are recording.A
1-
2< lv is already very cheap service
1,+nton senov: a coBfounder of ;&oin the players<
1-+nton senov: a coBfounder of ;&oin the players<
considering si6 to eight players in a team which maes 2>1 lv per person. -oreover, the
company is ready to offer discounts for teams that buy more than certain amount of service. 4t is
hard to accomplish many differentiators lie lower price, better service, superior styling, and so
on. Such boundaries may diminish profitability of the company or even push it towards
banruptcy. 4t is better to concentrate on several differentiators that do not contradict each other
but produce synergy.
1!.4 &taging
"nother very important aspect of developing a strategy is staging. 4t determines the speed
and se3uence of maBor moves to tae in order to heighten the lielihood of success. Usually
some initiatives must come first, followed only then by others. 4n business strategy there is no
universally superior se3uence. ?@oin the playersA committed itself to broadening its product line
domestically and later e6panding internationally. ?We have thought about e6panding, but we
want to stabili'e the solution here #in 0ulgaria$ first, and when we start e6panding to be
completely ready.A
1/
9ven though the e6ecutives are an6ious to e6pand geographically, they
reali'e it is very costly. To do so they need a more complete line in 0ulgaria that brings
sustainable profit. :therwise, they would have wasted a great deal of time and money. Urgency
in video>solution business is crucial factor because companies are facing brief windows of
opportunity, re3uiring that they be pursued first and aggressively. 8owever, ?@oin the playersA is
already one of the first initiators in the region. They need some time to establish solid presence in
0ulgaria before moving to internationali'ation. "nother factor is the credibility that attracts
resources and staeholders.
1!.5 '$ono(i$ )ogi$
"t the heart of a business strategy must be a clear idea of how profits will be generated. The
most successful strategies have a central economic logic that serves as the pillar of profit
creation. The ey resource for ?@oin the playersA is human capital that e6hibits core
competences. 8uman capital with core competences has dynamic capabilities of
learning=changing and fitting into environment. +owadays, technologically advanced machine
are available to everybody but that does not mean that every start>up will be successful. ?@oin the
players will succeed because of its human capital. 0ecause of dynamic capabilities of its staff,
1/+nton senov: a coBfounder of ;&oin the players<
competitors can,t readily imitate the offerings. 8owever, these competitive advantages do not
last forever. Sustainability is not guaranteed. ?@oin the playersA must use its advantages
efficiently and turn them into 3uic profits taing into account long term purpose=mission.
11. 2e8t Decision
" complete strategy considers all five elements. :mitting one might critically influence the
profitability of ?@oin the players.A "ll five re3uire dynamic capabilities. They cannot be
generated spontaneously. -oreover, one cannot e6ist without another. They are crucial in
designing a comprehensive, integrated activity system.
20
The ne6t decision for our start>up is to strengthen its position in 0ulgaria instead of
internationali'ation. That re3uires!
-areting of its product to more soccer fields, increase its customer base to be able to
generate bigger revenue and scale down it operations.
(rofitability is not very crucial for now as it will incur huge costs purchasing more
e3uipment to be able to serve more customers. -oreover, it must strive to utili'e full
capacity of available e3uipment.
Gain credibility H win the trust of investors that will bring additional funds and accelerate
its growth.
9ven if they are not generating profits for now, it is good to have as many contracts as
possible because they will have more e6perience and learn fast, recogni'e their problems
and find solutions.
20'onald *. 1a$!ric2 and &a$es 9. 4redric2son
9or6s cited
Grinberg, Samuel. JF4F"=2oca>2ola World /aning.J Fifa. Fifa World 2up T-, .1 -ar 2<.&.
Web. .6 -ar 2<.&.
*uiyantseva, -ariya. J:ratorica.J The psychology of the football. :ur (sychology, .2 :ct
2<.2. Web. .6 -ar 2<.&.
-ills, Oevin. JSportsnation.J Ultimate Standings. 9S(+, 26 Sep 2<.2. Web. .6 -ar 2<.&.
Sandell, -ichael. JSoccer in the US".J History of soccer. Geno @e'e, 2L "pr 2<<.. Web. .6
-ar 2<.&.
Shubniov, +iita. JSport.J The mistakes of the football referees. *ifeschool.ru, .. @un 2<.<.
Web. .6 -ar 2<.&.
Soroin, "ndrey. JThe will towards the victory.J o!er in football. :dnao, .& :ct 2<.2. Web.
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Taylor, @im. J(sychology Today.J Sports" #hat $oti%ates &thletes'. The (ower of (rime, 1< :ct
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8ambric, )onald. Fredricson, @ames. ?"re you sure you have a strategyRA "cademy of
-anagement 96ecutive, 2<<%, 7ol. .F, +o. &
Sugars, 0rad. ?The Fastest Way to Find +ew 2ustomersA 9ntrepreneur.
http!==www.entrepreneur.com=article=.L%LL<
en ways to approach new custo$ers. he $ar2eting 'onut resources for your !usiness.
http=>>www.$ar2etingdonut.co.u2>$ar2eting>sales>salesBleadBgeneration>tenBwaysBtoBapproachB
newBcusto$ers