Dr. Tim's Premium All Natural Pet Food: Growth Options and Web Analytics Insights Case Solution

2. Porter Five Force Model

Threat of New Entrants

New firms are attracted towards an industry which is experiencing a high growth. As Tim Hunt’s unique formula is particularly provided by his company, the customers who are loyal would not go towards another brand. Product is differentiated and it can cost high capital investment for research in order to develop a better alternate than the existing one.

Threat of Substitute Products or Services

There is a low buyer propensity to substitute because of the unique product offerings. As the number of substitutes available is low, consumers are less willing to buy any substitute product. Consumers are highly informed of the product specification and the product is highly specialized.

Bargaining Power of Customers 

Buyer concentration is lower as compared to the firm concentration which means that the buyer does have enough options to bargain about the price of the product. However, Hunt has to make sure that the product contains appropriate quality to make sure that consumers get what they demand, in order to maintain its position in the market.

Bargaining Power of Suppliers

Supplier bargaining power can be determined through the nature of this industry. Inputs and raw material are differentiated and as Hunt is himself a veteran, he does not have much problem in getting the supplies. There is a low supplier bargaining power.

Intensity of Competitive Rivalry

Hunt has to make sustainable progress in order to compete with other brands in the market. There is a high competitive rivalry in the market.

3. SWOT Analysis

Strengths

Hunt produces a high performance formula for racing canines. Low carbohydrate formula was the only one in the market containing special minerals known as pre-biotic. It was especially made for competitive racing dogs. The firm is experiencing high growth rate i.e. more than 100 percent.

Weaknesses

Market is already saturated with the products of Tim Hunt. The room for increasing consumer base has shrunk because of the saturation. The firm has to deploy different strategies in order to increase growth rate.

Opportunities

The firm can exploit the fact that its product is differentiated and it has loyal consumers around the market. It can also exploit the availability of technology i.e. Google analytics, in order to search an appropriate market for growth purpose.

Threats

High competition in the market can threaten the firm and decrease their consumer base if a better product is delivered by any other company. Poor analysis of market research can lead the firm into exploration of wrong markets for the consumers.

4. Strategic Alternative 1

The firm has the option to penetrate into the existing market by using the same products or by developing new products for the same market. Thus, it can use a mix of market penetration and product development in order to increase its sales and consumer base. Management has to use the available resources in order to evaluate customer needs and customer organic demands for their canine pets in order to promote their existing products to the same market. They also need to evaluate the consumer interest in other products than regular food of dogs. The firm may introduce cat and dog treats to the existing market in order to increase sales. Market penetration will require search engine optimization and improvement in web content and design. They can also introduce home delivery service for their customers.

5. Strategic Alternative 2

Dr. Tim premium All Natural Pet Food can opt for introducing current products in other markets or it can develop new products for the new markets. It has to discover new markets through existing products or develop the products according to the need of customers and their demands. Market development strategy will involve distribution of canine/feline kibble formulas in the global market or the market of US. Diversification strategy will require the firm to introduce pet treats and distribute it in the global or US market. It can also take the orders through the web portal and deliver products to the new customers. Evaluation of interest in cat and dog treats is necessary for this strategy. In addition to that, global hotspots for pet treats have to be studied in order to target them effectively.

6. Recommended Action Plan

Dr. Tim should choose to discover new markets either by introducing new products or through existing products. He can easily gather the data on the demand of dog food by the help of Adwords Keyword Tool. It will clearly show the hotspots where users are searching for a particular term such as Dog food. This tool will save the company’s resources which would otherwise be wasted on interviews and surveys conducted on international forum.
Dr. Tim can use the same tool to find out the demand for new products such as cat and dog treats with relation to the area. He can clearly find out the exact number of searches a user has made on a particular term. Google Analytics can also be used to find out the consumers around the globe. However, Tim should put his main focus on the organic growth of his product line as it has proven to be the most successful approach till date.