Hootsuite Harvard Case Solution & Analysis

SWOT Analysis

Strengths: The Company’s strengths play a vital role in increasing its consumer base as it allows the customers to have a team view while managing the accounts on the dashboards with quick access. Secondly ease in streaming and secure profiles are also the source of competitive advantage for the company, allowing the users to pre-schedule their posts as well. Furthermore, the company also provides its user guidance in accessing the basic solutions and providing them memberships either free or through certification. The process of providing solutions is also free of cost, adding more to the strengths of the company.

Weaknesses: The limitation of the company’s user interface is considered as a weakness for the company as it is restricted for streaming only, and best suits actively managed accounts. On the other hand, the company’s operating system is highly unstable that is also contributing in the weaknesses of the company.

Opportunities: Since the users are expected to avoid using multiple accounts with proper attention that provides the company with an opportunity to ease the situation for the users. The company can explore the opportunity of helping the users in managing multiple accounts on a single dashboard.

Threats: The biggest threat for the company is the increasing competition and most significantly from one competitor named as CoTWEET. CoTWEET is innovating and providing their users more ease in operating and managing their dashboards as compared Hootsuite which is why the company is expected to witness a shift of the user base from Hootsuite to CoTWEET.

Porter’s Five Forces Analysis

Bargaining Power of Buyer: With the increase in competition the consumers are empowered with options that is why the consumers are expected to bargain. Currently, the power of the consumer to bargain is moderate, but expected to increase with the growth of the business and options for consumers are expected to increase.

Bargaining Power of Supplier: The industry has no need of suppliers as the companies are developing and managing resources themselves so the power to bargain is low or not present.

Threat of Substitute: Currently the industry is on the verge of growth and is totally a new concept that is why the threat of substitute is almost none. On the contrary, with the increase amendments in technology and high use of innovation the industry is expected to face this threat sooner or later.

Threat of New Entrant: the industry is growing and showing immense potential for growth not just for current players but for new entrants as well. With the opportunities on the line and no barriers to entry, the threat is very high.

Competitive Rivalry: The rivalry in the industry is very intense with more than two dozen players in the market. The competition is expected to increase more with the new entrants expected to increase.

PEST Analysis

Political: The political environments are supportive of the industry and for the Hootsuite it is also an opportunity to excel in Canada and Japan.

Economical: The economic situation in Canada is quite stable which is why the company has no threat from economic factors. On the other hand, the market in Canada offers huge potential for the social media dashboard market, and the industry is considered to be highly optimistic.

Social: the country has no prominent dominance of a single culture as inhabitants from around have come and settled in Canada. Therefore, the country is highly diversified in terms of beliefs and norms.

Technological: Technological factors are highly important for the growth of the social media dashboard industry as the industry is highly dependent on technology to innovate. The country has immense potential and the availability of the new technologies related to the industry.

Financial Analysis

Exhibit 5 in the case shows that sales of the company are increasing on the trend and thus the company has achieved success from 2008 till 2010. In addition to this, the company is expecting to increase sales by more than 25% by the end of 2010, however, the overall industry average is not more than 18%.

On the contrary, the management of the company is struggling in terms of controlling its cost from the last two years and thus, the profits of Hootsuite are in a declining phase by 20% whereas the average in this industry is not more than 12%. As far as the net profit margins of the company is concerned, it is on a declining trend as well, i.e. approximately 50% to 32% by the end of 2010. To cope up with this, the company needs to take quick actions to manage the declining position of the company......................

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