“Industrial Organization Perspective (IO) is central to an understanding of the economic behaviour of firms.” IO uses economic theories and models to predict the industrial environment that a firm is facing and then predict firm’s and firm’s competitors’ behaviour. It is necessary to define market scope before using IO to analyse firm’s strategy since accordingly a firm can define its buyer, supplier, competitors, and products. A market is “the intersection between buyers and sellers” (Sloman & Sutcliffe, 2001:22), or “any system of complex exchange in which tangible as well as intangible products are exchanged to create value for voluntary or imposed exchange partners” and this definition “clearly departed from traditional definition which is conceived a market as a group of product (goods and services) that a group of customer consider as substitutes in a certain usage situation.” (Bubois et al, 2007:19).
The challenge to use this approach to analysing Realeyes is its market segmentation is still arguable. As an emergent technology, Eye tracking is currently used in child study, in primate behaviour study, in assistive technology (assist disable people to use eyes to control devices or communicate), or in commercial marketing research, usability research, and there are still more possibilities to be explored. Therefore, the first challenge to use industrial organization perspective to examine Realeyes’ capability is to find which exact industry it is located. But since usability business is the biggest revenue source which consists mostly by static ads, it makes more sense to classify Realeyes as in eye-tracking usability market.
Partner Network
The other school of thoughts still focuses on the relationship in industry but disputes Porter’s belief that industry is basically a competitive environment since many successful marketing strategies are made out through close cooperation; examples like Prada versus LG1, Pfizer versus Alliance Boots.2 A good partnering relationship could be a great asset to company since greater synergy is created while it also needs to be careful selecting a right partner(s) or it will become a nightmare. Meckl and Schramm (2001)’s paper too mentions Coviello and Munro (1995)’s emphasis on Network relationships being important to access and enter new foreign markets. However, we will discuss more about partnerships in Entry-Mode Strategy section 9.4.
Realeyes has put 5 companies as its partner on its website. According to Realeyes website, every company appreciates the complementary benefit Realeyes brings to their business.
In terms of mutual benefit, no solid number makes it unable to estimate their extent of cooperation. Furthermore, only 1 out of 5 has equally put Realeyes as their partner on their website.
Table 6 indicates that Realeyes has potential to utilize its partner network, while it should contemplate its objectives and contents, and for Australia market, it could try to leverage current partner network to access to potential business partners.
Table 30 Realeyes current partner analysis
Source: Foviance, Yuseo, Prescient, Logan Tod & Co, Webtrekk websites
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