Virgin MobileEssay Preview: Virgin MobileReport this essayInternal Factor EvaluationCritical Success FactorsWeightRatingWeighted ScoreStrengthsпЃ¶Strong name recognition from prescription drug usersпЃ¶Strategic alliances create stronger marketing to consumersпЃ¶FDA approval is less time consuming and less expensive for OTCпЃ¶Prevention claim distinguishes Pepcid AC from competitorsпЃ¶Recruiting pharmacist proved successfulпЃ¶Sales and profit projection encouraged drug stores to actively promote productWeaknessesпЃ¶Over the counter version could drive the price of the prescription downпЃ¶Simultaneous studies prove costlyпЃ¶First to the market may not occurпЃ¶Tagamet leading in FDA approvalTotal ScoreExternal Factor EvaluationCritical Success FactorsWeightRatingWeighted ScoreOpportunitiesпЃ¶FDA approval is less time consuming and less expensive for OTCпЃ¶OTC market for anacids continues to thriveпЃ¶Clinical trials show treatment claim as effective for potential buyersпЃ¶BASES II trials show favorable for target usersThreatsпЃ¶Business revenue estimated lower than targetпЃ¶Brand awareness from competitorsпЃ¶Leading Antacid brands have more market shareпЃ¶Marketing advertisements limited by the FDAпЃ¶BASES II trials show prevention claim as not favorableпЃ¶Prescription will compete with the OTC versionTotal ScorePorter’s Five ForcesпЃ¶Supplier Power – WeakLots of cell phone providers, therefore companies like Kyocera lower prices to contract with service providers.пЃ¶Buyer Power — StrongCurrent cell phone service providers are numerous, which allows for many options for buyers.пЃ¶Barriers to Entry — WeakThere is nothing that will prevent Virgin from competing to an untapped market.пЃ¶Threat of Substitutes — WeakThere are very few substitutes available that offer mobile and immediate communication. Alternative like pagers are outdated & this target market cannot afford sophisticated PDA service.
Degree of Rivalry — StrongCompetitors have brand recognition in the US and have the majority of the market share.Competitive Profile MatrixVirgin MoblieA T & TCingularVerizonSprintPriceBrand RecognitionAdvertisingMultimedia FunctionsOperating ExpensesTotalBased on the CPM data, Virgin’s main focus should be primarily price, operating expenses, and brand recognition. The company should spend their money in these areas because it will yield the most return. Advertising and Multimedia functions have already been addressed. Each company will have to compete for market share. Price is an essential component of their marketing strategy, since they are dealing with a younger crowd.
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Financial AnalysisTop CompetitorsA T & TT-Mobile USAAnnual Sales63,055.0014,080.00Employees302,00029,000Market Cap ($ mil.)256,432.90Current Market Data- Virgin Mobile USA, Inc.Company TypePrivate (NYSE: VM Proposed)Fiscal Year-EndDecember2006 Sales (mil.)$110.61 Year Sales Growth(88.8%)2006 Net Income (mil.)($36.7)2006 Employees(Source: Hoovers.com)Initially, Virgin may have no great profits since they are trying to be the low cost provider. Although they were profitable in the UK, they have no brand