Shearwater

This river Is the fourth largest river in the African continent. The company grew to dominate the “Adventure” market in Victoria Falls. As a result of this expansion, Shareware Adventures became the most well known adventure-tour operator in the continent of Africa.

This expansion occurred while the company was under the leadership of Robert Allen who Joined Shareware ten years ago.

He began as a photographer with friend Mark Davis taking pictures and videos of the rafting trips. He went on to become Chief Executive Officer (CEO) after Davis’ departure. Shareware was number one in the market. Regardless of their dominance in the Victoria Falls area and their position as leaders In the market, Shareware adventures had to face the competition. They had to continue dominating while maintaining their reputation as a successful and profitable outdoor adventures operators.

To achieve their established goals, Allen Roberts and his management team created different treatises in order to compete efficiently and to maintain their leader position. First of all, the company was counting on its name and reputation since the word of mouth played an important role in new sales. Also, the goal of the Shareware Adventures was to achieve repeat bookings from satisfied customers, maximize profit and increase their market share. Shareware Adventures established partnerships and acquisitions with leading Tour Operators such as Seaman African Safaris to boost their reputation and to gain business.

Acquisitions that have increased their competitive scope and profitability in the long run. Advertising is obviously key to attracting tourists who are confused about their choice concerning an adventure activity.

The continuation of an advertising program was primordial for the company. The fundamental fact of their success and strength that made the company is the level of differentiation. Indeed, in comparison to their competitors, Shareware Adventures differentiate themselves by offering far more activities than the competitors. This allows customers to have a wide range of choices from rafting trips to lion encounters.

Meanwhile, most competitors offer more or less 3 options: white eater rafting, boating and elephant riding.

By offering more than the competitors, Shareware created a competitive advantage by bringing customers what competitors could not. As a result, Shareware remains a leader in the market and competitors will have no other choice than to design and create a new adventure. Otherwise, they could also copy Character’s products and services. In addition to its several activities, Shareware offers packages allowing customers to choose from a selection of activities for one price.

Through a differentiation strategy, and by distinguishing itself, Shareware obtained a competitive advantage.

This allowed Roberts to maintain his position in the market. As a result of these strategies, from 2004 to 2006 the number of guests increased from 26,351 to 41,868 as well as the revenue. QUESTION 2: Perform a 5-forces analysis of Character’s competitive environment. FORCE 1: Rivalry among competing sellers The industry is ranges from around $400 – $500 million, however this industry is fragmented: that is to say, it is spread worldwide in relation to areas offering the chance to perform such activities.

There are many competitors: Over 40 areas of activities (I. E.

Kayaking, safari trips, extreme sports). Locations are all over the world and there are over 250,000 operators that compete in the same “outdoor activity’ market. Yet, operators, such as Shareware, focus on the local level when it comes to competing. Zombie’s political and economical instability. Though Zombie’s tourism had declined by 75% and inflation was at 1,200% Shareware continued to be the market leader in the area with an 80% share market.

It had managed to increase sales by 22 and 39% percent in the last couple of years.

Shareware dominates in Victoria Falls and become the most well known adventure tour in all of Africa. Even though Shareware is the leader, companies have partnered up in acquisitions, associations and networks with other businesses in order to increase their market share. Rivalry among competitors is high. FORCE 2: Threat of New Entry For small businesses to enter the industry, the cost may be as low as $20,000 for a $200,000 is estimated.

It may be difficult to start an operation in the U.

S. Because of cost of permits and government, state or municipal regulations. However, installing a new company is Southern Africa (for example Zanzibar and other surrounding countries) is quite feasible for new operators in the market. We must continue to take into consideration the current economical and political instability of Zanzibar for those organizations attempting to enter this market There is a certain “Experience Curve” path that a new company may experience.

It is important for management to be thoroughly aware of every detail concerning operations and financial matters, as well as the local market.

This experience may take some time to acquire. On top of that, a new competitor should realize that it would be competing with other brands (especially Shareware) that have an already established notoriety, a client list and advertising distributors. Threat of entry is relatively moderate. FORCE 3: Threat of Substitute Products This is an “Outdoors/ Extreme Activities” Market.

The necessary ingredients to create this service involve irreplaceable factors such as: waterfalls, natural water rapids, mountains, fresh air, nature, scenery, etc. There are new activities that may be though of, however those would go directly into competition, and would not be considered as substitutes.

Threat of Substitute Products is low. FORCE 4: Bargaining Power of Suppliers The nature of the service supplied is not a commodity, and cannot be reproduced or duplicated. Even though suppliers reach the 250,000 mark worldwide, these operators are vastly spread out concerning the nature of the activity.

White water rafting for instance, requires a location with a water body, waterfalls, rapids, wild outdoors settings and beautiful sceneries, among other things. The company can only go as far as supplying the equipment needed to ride these waters. The only way operators may integrate backwards is if they decide to produce their own equipment and trained professionals.

However, this would only be a good strategy if the costs were less than what they already pay to suppliers. Given the type of activity offered, here is a small chance of supply shortage.

The Bargaining Power of Suppliers is moderately high. FORCE 5: Bargaining Power of Buyers The demand for this industry is moderately sized. The target age in the industry was from mid ass’s to early ass’s. These people had the drive to stay “young at heart” and the available income to fulfill these desires.

Until recently, the media has created an awareness of adventurous locations, and their desire to explore them increased. They may only integrate backwards by buying their own equipment and training themselves on outdoor skills.

However, since most of the consumers are over the age f 40, this seems to be a bit of a challenge. Although Shareware advertised locally and partnering with tour operators, the local community seems to have a certain amount of power over the promotion of this company. It has progressively gained notoriety, and Roberts should be mindful that should he upset the community, they may bad mouth his business.

The Bargaining Power of Buyers is moderate. QUESTION 3: What are the Skiffs for competing in the Extreme Adventure Sporting Industry?

There are several variables that have had a direct impact on the of Shareware Adventures are: Brand Recognition: The company relied on its name o achieve their goal of repeat bookings, and cooperation with other companies (e. G. , tour operators) for cross-selling opportunities could offer them a higher probability to gain exposure and business. Strong Leadership & Management: Mike Davis and Allen Roberts were excellent entrepreneurs. Their leadership, particularly Roberts’ role as Character’s CEO after Davis left, played a critical role in enabling Shareware to dominate the outdoor adventure market.

Favorable Destination: Opening an outdoor adventure company in the United States is difficult due to the cost of remits, so opening an adventure operation in South Africa was more attractive and cost-effective. Strategic Partnerships: Strategic partnerships played an important role in Character’s successful growth, since “Industry leaders were partnering through acquisitions, organized associations, and reseller networks in order to increase repeat bookings from satisfied customers. ” Strategic Advertising & Marketing: Their goal was to target and direct customers at the start of their vacation.

Shareware engaged in intense local advertising to attract a large number of newly arriving tourists who had not chosen an adventure. This allowed it to attract a large share of newly arriving, non-committed tourists. Variety of Activities Offered: Larger variety of outdoor adventures activities was a strong differentiation for Shareware.

Most competitors had a limited number of activities, making Shareware superior in the local market. Companies that could offer a variety of activities had a much higher probability of gaining repeat business.

Pricing Strategy: Bundling activities that allowed customers to choose from a selection of activities for one price was highly attractive and added to the company’s value and success. Cross-selling Opportunities: Character’s expansion into related business activities, like tourist transportation, lodging, and video & photos, allowed the company to cross-sell and increase its sales revenue through these related business segments. Community Support: Support from locals was also an important reason for the company’s success, as it added credibility to the company.

It enabled smooth operations for Shareware, increased its reputation, and thus increasing its strength in the industry. Skilled & Qualified Team: Through Allen Roberts’ leadership, he continued to build a old management team due to his knack for attracting the right person for the right job. These 10 Key Success Factors have contributed to the growth and success of Shareware Adventures, and has continued to make them a current market leader in the outdoor adventures industry in the Victoria Falls area. 4.

SOOT Analysis Strengths: Located in the tourist area of the Victoria Falls, Zanzibar Shareware is considered to be the giant leader of the area (with 80% market share), in fact leader of all Africa Company driven by a knowledgeable and experienced manager, Allen Roberts Industry image”, extreme sports are seen as a way to enjoy time away from hectic lives (average age of customers between ass and ass) Shareware Adventures LTD.

Offers a wider range of activities then competitors (at least 11 activities against 3 for competitors) Possibility to organize both individual trips and packages (e. G. Ticket to Adventure” package, where you can make huge savings and choose what you want to do and when) Strong local level awareness, “Word Of Mouth” has helped increase ESP., Survivor etc. ) Improved equipment quality Weaknesses: Although Shareware Adventures have 80% of the market share, competition is tough enough for company to worry about continuing market domination while maintaining its reputation as a “successful outdoor adventures operator” The company clearly has a tight budget, “Roberts and his management team had already cut Character’s expenses to the bone and had given up their company cars for motorbikes” (p.

Paragraph 3) Weak global level awareness, as companies looked to grow their market share and increase customer base on a local level (global level seemed ore of an obstacle) It appears that outdoor activities companies must deal with aging equipment and older owners when company reaches its maturity Opportunities: The Shareware Adventures LTD. Can link up with international travel companies for purposes such as gaining international awareness and prepaid guaranteed reservation Implement a better advertising plan for repeat bookings and cross-selling Maybe the business should consider acquiring other companies?

Creating a new venture to attract a younger crowd Threats: Zombie’s economical and political instability has caused a 75% decrease of the country’s tourism and inflation was 1200% causing prices to double every 22 days Competitors might offer a wider range of activities as it is relatively inexpensive and here are enough ventures to copy Shareware or add new adventures 5.

Provide recommendations concerning Character’s future strategy As we know Shareware is already the leading company in the adventure/extreme industry for the continent, logically, the main question will be how to improve when you are already the number one or at least, how to stay number one? Buying Companies the idea of buying companies was from Allen Roberts himself and was, from my point of view, one of the most interesting. Buying companies allow you to kill the competition (within the area) and in the meantime to increase your market share by absorbing the competitor’s.

In the other hand Shareware will need a substantial amount of money for this type of investments, money that they may not be able to collect.

Despite the financial factors, integrating competitors to the company will allow Mr. Roberts to create his own rivalry in the Victorians fall area, allowing to expend, generate more revenues while controlling the all business. Targeting Market Segment The actual targeted segment, people who are “mid ass to early 50” are certainly as kayaking or rafting.

By focusing on this market segment they completely forget generation who grew up with that kind of sports. Enhance by the media and famous energy drinks ( HTTPS://www.

Youth. Com/watch? V=MFC-Hocks&hd=1 ) adventure or extreme sports have become a very important trend for the 20-30 years old. It would be a shame to miss such an opportunity to increase the market share when the only effort you have to make is to make people aware of your complex.

Developing the company’s assets A wide range of activities, affordable prices, but do they really focus on the essential? People around 50 are attracted by this healthy way of living so why don’t they develop a healthy/fitness programmer. Mixing sports and dietetic/healthy food as it is the trend nowadays. This strategy is using the current assets of the company in a different way that could be a lot more appealing for customers.

Worldwide vision Advertising on a local/national level would be useless for Shareware as it is already recognize as the number one.

What they needed is a worldwide vision, let people know that they are providing one of the best experience in the adventure industry, and if people are not interested in sport why won’t they come for the location in itself. The use of new type of communication such as backbone Twitter or threw sponsors (Red Bull, Monsters.

. ) have already helped the cause of extreme sports and pointed out he fact that people are more than interested in that kind of leisure. Be a precursor In every single industry, leading companies overcome difficulties by creating their own product and/or creating the demand.

In the past few years a lot of new sports have immersed, creating one, could be the chance of an international recognition and healthy finance. Their status of number one is not immutable, they should use their monopoly on the market to create what they think would be the adventure industry of tomorrow. As a reminder, the main question of the case study was “how to continue to dominate he market while maintaining the reputation as a successful outdoor adventures operator”.

The difficulty of choosing a strategy is emphasis by their status of number one, with no comparable company all over the continent the only reasonable choice seems to completely create the wanted path. They got the recognition, the infrastructures as well as a strong leadership. By having a step ahead of the competitions they can maintain their reputation but for how long? To conclude, strengthen by their position, they should choke the competition by redefining what venture industry means in their own words.