Tivo in 2002

CASE STUDY

TiVo in 2002: Consumer Behavior Question #1 1.(A) According to Keast, “there is a mystery in the sharp contrast between the inertia of prospects and the evangelical zeal of TiVo users.” As an emerging expert in consumer behavior how would you tackle that mystery? According to the case study, there is a sharp contrast between the inertia of prospects and the evangelical zeal of TiVo users, this gap can be shortened by adapting different strategies i.e., • The marketing and promotional strategy should be changed because it wasn’t prosperously increasing the subscribers of TiVo. • The pricing strategy should be revised, as only the affluent class could afford it and respond to it. • Awareness about the product should be increased and more importance should be given to word-of-mouth promotion, to enhance penetration into broader market. • As the percentage of customers purchasing through referrals is high compared to other mediums so a strong celebrity should be endorsed for its promotion. • Positioning of TiVo should also be stressed upon because it wasn’t portraying a clear image of what actually the product is. 1.(B) What do you think could be going on? Beyond your pet hypothesis, try to be creative and list a large number of conflicting hypotheses by taking multiple points of view. There are a lot of things going on with TiVo but the most prominent which I think can be taken as variables for studying their effecting on the gap between the forecasted demand and the actual demand can be hypothesized as following; 1. People reluctance on buying of new technology gadget like TiVo.

2. The price of TiVo is high for an average prospect to buy.

3. The awareness level of TiVo is far less to gratify subscribers. 4. The target group is not defined and clear. 5. The marketing strategy of TiVo is not strong enough to produce the urge of purchasing TiVo. 6. Some population still not considers watching TV without a TiVo, a problem.

7. There are a lot of substitutes for TiVo. 8. Customers go more for word-of-mouth purchase than purchasing through an advertisement. 9. TiVo changes the lifestyle and daily schedule of its customers.

10. The distribution should also be extensive if TiVo wants to capture a broader customer base.

1.(c) What might “evangelists” mention as a cause of their failure to sell TiVo to their friends?

The evangelists might say that TiVo is too expensive for an average income household, the product features aren’t exactly clear to most of the population; people are reluctant to share their TV viewing habits with a company, and moreover most of the people still aren’t technology savvy. 1.(d) What might a “couch potato” say about his reluctance to buy TiVo? The couch potato might argue that; “I have all the time of the world, why should I