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and predicting opportunities and demand for drawing potential clients.Strategic OptionsOption 1: Utilizing all the resources to enter to tier 1 city’s ride-hailing market.Option description.The first strategic alternative is to start ride-hailing services for a second time and compete aggressively with the existing firms. Uber and Ola are competing with each other in taxi-aggregator and food-delivery industry mainly in tier 1 cities due to a high
JUGNOO COMPANY24value of the market. Gaining a portion of market share in these cities could bring a high profit even though the competition is getting hard. Since people perceive Ola and Uber as a taxi-aggregator, Jugnoo could shift its business to only autorickshaw-hailing to capture separate market share. Also, they can offer all their B2C and B2B services in tier 1 cities to shift their position in the market to a multi-service provider. Taste diversity in big cities is the existing opportunity. Benefits and outcomes.Tier 1 cities have more population and a bigger market. As a result, a small market share in these cities could be financially beneficial for Jugnoo. On the other hand, creating an image in capital cities help Jugnoo to be known all around India and accelerate their expansion to other cities. Also, they can run other services they have at the same time to reach out to a wider range of customers. Moreover, there are thousands of restaurants, partners, and other businesses to build partnerships to maximize the territory. Critical success factors. The most important factor for jugnoo to enter to tier 1 cities is their price strategy. Due to the existence of big firms as competitors and their efficient pricing, Jugnoo has to offer a very competitive price for its services to remain in the market. Uber and Ola have been offering the lowest prices for a few years benefiting from a good reputation in large cities. The second factor is broad advertising before launching any service. Customer awareness has an essential role in this type of competitive environment. Hence, word-of-mouth is not enough compared to face its competitors’ aggressive communication. Widespread and various advertising is required to create awareness and demand for Jugnoo’s services. Threats and risks. This option is so risky, primarily because Jugnoo already tried once to expand its business in tier 1 cities and it failed. Therefore, the threat of competitors is serious
JUGNOO COMPANY25because they have been working for years having their customers, reputation, brand image, and connections. Furthermore, Ola and Uber’s objectives are capturing the most market share, not profitability, which is opposite of Jugnoo’s target. Therefore, the chance of failure is fairly high. Option 2: Expanding All Verticals in entire tier 2 and 3 cities based on prioritizing of cities and services.