TIVO: ADVERTISING CONUNDRUM

INTRODUCTION

TiVo is a Digital Video Recorder (DVR) introduced in 1999 TiVo was developed by Jim Barton and Mike Ramsay Record and playback broadcasted TV programs

PRICE VARIATIONS
Model 30 hour of recording 14 hours of recording Price $999 $499 Subscription Period 1 Month 1 Year Lifetime Price $9.99 $99 $199

PLAYERS

TiVo Phillips and Sony hardware Main Competitors

Own hardware UltimateTV Thomson and Sony

ReplayTV

Other Competitors
Jovio Seagate-Thomson

JV

FEATURES
TiVo ReplayTV UltimateTV

Pause, Fast-forward Quick skip 30s fast Surfing internet, bundling (speed 3x), Thumbs up, forward, pause live TV, with DirecTV for satellite Thumps down, Season record programs TV, watching and pass records episodes recording two shows of a series, Suggestions, simultaneously, 30s skip, TV guide, video fast-forward at 300x speed magazines

CHANGING CUSTOMER TRENDS

Avg household spend 7.4hrs a day before TV and avg Adults spend 4.3 hrs per day.No of families owning a TV - enormous increase. Remote control introduction dipped advertisement. Zapped by 5%. 68% Americans - complain - they feel lonely (widowed) during fall season as their spouses stay tuned to television. Couch potatoes - Parents catering children unhappy - during favorite

CHANGING CUSTOMER TRENDS (CONTD..)

Customers are used to the live streaming and they may get excited when they are shown features like a pause People will love the most when they can have more control over the watching a channel If a product can help them record and replay their favorite programs, the product launch can make a huge impact Entrepreneurs of TiVo had the vision of

AFTER TIVO
62% of TIVO owners watched more - TV 16 to 31% increase of people in claiming TV as the primary entertainment, 59% said they watch programs which were once unavailable to them, 31% decrease in channel surfing, Children prog n dramas most recorded., 70% owners watch recorded materials every day, Fast forwarding of commercials done frequently,(90% commercials skipped) Customers tend to skip 90% of the

SWOT ANALYSIS
Strengths : Many innovative and addictive features Great brand recall among existing customers
Weaknesses :

Functions were confusing and difficult to explain to customers

Expensive product Making it a market skimming strategy Promotional activities restricted to public relations, animations in TiVo website Lack of brand awareness among customers

SWOT ANALYSIS

Opportunities : Untapped market in terms of volumes Many other features can be bundled with the

Threats : Low salesperson turnover rate which lead to an increase in training costs Competitors with strong brand image entering the market Networks and advertisers unhappy with the antiadvertisement benefits

STP

Segmentation
People

who watch Television (US Market)

Targeting
People

who have time constraints in watching specific programs Job holders, children Couch potatoes

Positioning
Choose

your own Prime Time

MARKETING PLAN - PRICE

TiVo is more expensive than most TV sets and twice as expensive as a good satellite TV system The company should use a market penetration strategy as it is an unknown product No reference point for the price of the product

MARKETING PLAN - PRODUCT

Onscreen programming guide was confusing Changing channels caused the TiVo picture to break up or freeze briefly Many customers like TiVo but some others are worried that their TV viewing habits are being monitored. Aptly captured by one customers response - Why pay to be spied on

MARKETING PLAN - COMMUNICATIONS

Promotional activities restricted to public relations, animating its website, very limited mass media campaign The network executive ad Program your own network is not straight forward Inconsistency in the way the product is projected by the sales persons The proposed TV commercial ads are too vague. They dont convey the benefits of TiVo Changing consumption habits altogether on

ALTERNATIVE PLAN

Identifying Target Consumers is important Primary target consumers: 68% of Americans felt widowed by their loved ones during the fall television season Instead of features, benefits should be advertised more aggressively Awareness about a) Features, b) Benefits, c) Attitude, d) Imagery is important Different mediums should be used to promote features and benefits TV, Radio, and Print can be used to promote benefits TV and Internet can be used to promote features Internet and direct marketing can be used to promote features by Interactive tools

Communication

ALTERNATIVE PLAN (CONTD)

Ads on internet, paper, radio, newspaper are high in reach Direct Marketing can be used for richness (But will incur Cost) Attitude gives You the control! No more Prime time, non-prime time programs!!
Reduce the price from $999 to $399 (30 hour) Introduce Discount Coupons with other premium Phillips or Sony products Introduce limited offers in high TV penetration area Bring in a buddy get Lifetime subscription

Price

Promotion

ALTERNATIVE PLAN (CONTD)

Product

Tie up with DirecTV for a leverage over its service DirecTV-TiVo Best Buy, Circuit City and Sears should not be at the Point-of-Purchase Placed near TV as mentioned earlier, this is an accessory

Place

Thank You