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Commentary on:
How will 3D Systems penetrate the rapidly growing
consumer market for personal 3D printing technology?
Nathan Pho
IB #:
Word Count: 1496
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Table of Contents
Introduction...3
SWOT Analysis5
PEST Analysis..7
Ansoff Matrix9
Conclusion11
Bibliography.13
Appendices...14
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Introduction
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the personal 3D printer market as more and more are purchased by average consumers. While 3D
systems is still the leader among 3D printing companies, they have fallen behind in the consumer
market for desktop printers to Stratasys. As the consumer market continues to grow, 3D Systems
must find a way to penetrate the consumer market in order to maintain their dominance as the
leading company for rapid prototyping.
In order to determine how this can be done, I plan on using the following tools:
the future
The purpose of these tools is to hypothesize on: How will 3D Systems penetrate the rapidly
growing consumer market for personal 3D printing technology?
Findings
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I decided to conduct a SWOT analysis in order to understand 3D Systems current stance within
the market; what areas are their strengths and what areas are their weaknesses, and in what areas
do they have opportunities to improve? My analysis will be based off of a Forbes article from
late 2013 titled 3D Systems Leads 3D Printing Movement But HP Could Become A Major
Player, Jefferies Says, which provides a summary of 3D Systems stance in the rapid prototyping
market as well as how it compares with many of their competitors. It will also be based off of
BidnessEtcs article on the 3D Systems Corporation
3D Systems Corporations SWOT Analysis
Strengths
Control of patents
Highest market share for
professional/industrial grade 3D
printers
Among highest quality 3D printing
technology
Weaknesses
High price points (especially starting
prices)
Smaller market share for personal
desktop 3D printers
Danger of piracy/intellectual property
rights violations
Opportunities
Threats
Large increase in demand for personal
Competitors with a larger share of the
3d printers
Unexplored technological possibilities
This SWOT analysis depicts several important things regarding 3D Systems current
stance in the market. 3D Systems does have a decent amount of security in having higher quality
technology than the competitors, as well as also owning patents and controlling for the most part
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the industrial and professional segment of the 3D printing market. That being said, 3D Systems is
falling behind the competition in terms of pricing, especially for the personal consumer models,
and as a result is losing out on market share to the competitors who offer cheaper models. In
order to combat this, 3D Systems can find ways to lower the productions costs of their
desktop/consumer models of their products, even if it requires lowering the quality in the short
term to do so. They can also create a marketing plan to convince the average less affluent
consumer to see the appeal in spending the extra money to get a higher quality product than the
competitor.
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technology among average consumers. My analysis is based on a Forbes article outlining the 3D
printing market, and the University of Oregon Investment Groups summary/analysis of the 3D
Systems Corporation.
3D Systems Corporation Consumer Market PEST Analysis
Political:
Economical:
Rapidly growing market for 3D printers
Lack of stability by extension of this rapid growth
Currently there is no global market
High price points/research and development costs
Social:
3D printing is not yet a widely accepted/used technology
Consumer anticipation/high expectations for the future of 3D printing technology
Technological:
Stereolithography technology/patents
Wide variety of technological applications for 3D printers
Aftermarket materials or ink for 3D printers
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From this analysis it can be determined that there are many social and technological
factors that 3D Systems must consider when developing a growth plan for the future. First of all,
in terms of social factors, there are still many consumers who do not see 3D printers as a
practical investment and do not see any upside to owning one. Secondly there are the
technological factors to consider regarding what materials to use for 3D printing, or the ink for
a 3D printer. This influences the cost of owning a 3D printer over time; if 3D systems can find a
material that is equally as effective but cheaper, they can counteract the higher initial costs of
their personal 3D printers.
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I decided to use Ansoffs matrix in order to outline different possibilities and option that 3D
Systems has for growth.
3D Systems Corporation Ansoff Matrix for Growth Strategies:
Existing Markets
New Markets
Existing Products
New Products
Market Penetration
Product Development
Professional/Industrial
Cheaper line of 3D
3D printers
printers?
Personal 3D printers
Experimenting with
Marketing strategies,
new
lowering prices/cost
technologies/methods
of production
of 3D printing
Market Development
Expansion into
Healthcare, aerospace,
architectural,
entertainment and
defense related
applications of 3D
printing
Diversification
CAD software to be
used in
accompaniment with
existing products
Potential for food
printing technologies
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Based off this matrix, the two best areas of growth for 3D systems to focus on are market
penetration and product development. While 3D systems already has a personal model of 3D
printer, they do not control the majority of that consumer market and there is a tremendous
amount of opportunity for 3D systems to expand into that market vacuum. One of the ways that
3D systems can further penetrate this consumer market is through product development. If 3D
Systems can make their product line of personal 3D printers both cheaper and more appealing to
the average consumer, than they will be able to gain an edge on the competition because of their
dominance in the professional/industrial market, their large number of patents in the rapid
prototyping field, and many business acquisitions, as well as partnerships with companies such
as Autodesk inc.
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Conclusion
From my analysis, it becomes clear that there are several things that 3D Systems can do
in order to expand into the growing consumer market for personal 3D printers and maintain an
edge over the many competing companies within similar fields. Firstly, their primary concern
should be to lower the starting prices for their personal models of 3D printers. Being a
technology that has only recently become accessible to the average consumer, the price point is
naturally going to be high, but competitors such as Stratasys have starting desktop models at
prices as low as $400-500, whereas 3D Systems current starting price point is $999. If 3D
Systems can find a way to lower the cost of production and by extension the prices of their
products, than their higher quality of products will be able to edge out the competition. Also,
their establishment and reputation as the biggest name in the professional world of 3D printing
will be beneficial when transitioning into the personal market.
The second thing that 3D Systems needs to do in order to expand into the personal 3D
printing market is to make a strong marketing push. They should focus heavily on two things:
convincing consumers of the upside and practicality of owning a 3D printer, and convincing
consumers of why they should choose 3D Systems higher quality products despite the higher
price point. Additionally, if 3D Systems can further develop their products to reduce the cost of
ownership (cheaper aftermarket materials), then they can counteract the issue of the higher initial
cost to buy a printer. While it is already a fast growing market, many consumers still need
convincing in order to invest in a very new technology, especially with such a hefty price tag. If
3D Systems provides that push through marketing, they will be able to secure a larger portion of
that personal consumer market before competitors are able to.
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The third thing that 3D systems can do to ensure their market share in the personal 3D
printing market is to continue making acquisitions or partnerships with similar companies, or
companies with technologies that will work towards their benefit. For example, their partnership
with Autodesk inc. both provides them with the CAD technology and software to run their 3D
printers, but it also allows 3D Systems to tap into Autodesks existing customer base, many of
whom would be the same customers who would be potential customers for personal 3D printers.
3D Systems has many opportunities in one of the fastest growing technological markets in
todays economy, but because of the stiff competition and the current issues with the technology,
they must be able to lower their prices, make a marketing push, and continue making smart
acquisitions and partnerships.
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Works Cited
"3D Systems Corporation." BidnessEtc.com. Bidness Etc, 14 Feb. 2014. Web. 7 Mar. 2015.
<http://www.bidnessetc.com/business/3d-systems-corporation/>.
Columbus, Louis. "Roundup of 3D Printing Market Forecasts And Estimates, 2014." Forbes.
Forbes Magazine, 9 Aug. 2014. Web. 10 Mar. 2015.
<http://www.forbes.com/sites/louiscolumbus/2014/08/09/roundup-of-3d-printingmarket-forecasts-and-estimates-2014/>.
Dingler, Andy. 3D Systems Corporation (n.d.): n. pag. University of Oregon Investment Group.
University of Oregon, 2013. Web. 11 Mar. 2015. <http://uoinvestmentgroup.org/wpcontent/uploads/2011/05/DDD-2.pdf>.
Gutteridge, Lloyd. IB Business and Management. Oxford: Oxford UP, 2009. Print.
McGrath, Maggie. "3D Systems Leads 3D Printing Movement But HP Could Become A Major
Player, Jefferies Says." Forbes. Forbes Magazine, 11 Dec. 2013. Web. 6 Mar. 2015.
<http://www.forbes.com/sites/maggiemcgrath/2013/12/11/wall-street-says-3dsystems-leads-3d-printing-movement-but-hp-could-become-a-major-player/>.