Case Study Of Tomtom's Corporate Level Strategy

TomTom strategy is to provide the best location and navigation solutions on multiple platforms from portable navigation devices, to in-built systems to mobile phones and the internet.

TomTom has carried out appropriate planning in order to operate strategically and competitively. They have shown that it is in their nature to move fast with all aspects of its lifecycle, ensuring they do not get left behind. They have shown themselves to be a first mover in many aspects of their strategy. An example of this is the partnership with Microsoft with regard to application development when they became popular. They also developed the first navigation device for a car.

TomTom’s corporate level strategy of acquisitions and partnership and outsourcing

What opportunities and threats do you see for TomTom? What macro-environmental trends contribute to your analysis?

The macro environment in which a company or sector operates will influence its performance, and the amount of the influence will depend on how much of the company's business is dependent on the health of the overall economy. As we can see from this case Study that TomTom suffered financially from the “Global Recession”.

The 2005 FCC Mandate which compels all mobile phone makers around the globe to ensure that their phones are fitted with GPS is a significant factor that could adversely affect TomTom.

TomTom attempt to embrace this change by creating an Iphone app – In 2009 Apple had 66.61% of the global mobile phone market, which Android had 6%

By the end of 2010 Apples market share had dropped to 50% and Android had increased to 24% but TomTom only developed an App for the Iphone, this is another shift that was outside of the control of TomTom.

http://techcrunch.com/2010/03/25/admob-registers-50-market-share-for-iphone-os-based-on-smartphone-traffic/

There should be team of developers working for TomTom that can develop relevant software applications for use in smartphones globally.

• Marketing – The enhanced software applications need careful marketing plans. The table below summarises the marketing of TomTom’s new software applications.

Entering new markets

European and North American markets show signs of maturing (Hoffman, 2010). Comparing 2008 and 2009, it is seen that revenues for Europe and North America fell by 22% and 52%. It’s clear from the case study that the main reasons for this are:

1. Economic uncertainty

2. Reduced consumer purchasing power

3. Changing customer preferences

It is expected that the situation will not improve. Therefore, TomTom needs focus on entering new markets. This is one of their main opportunities and they should, by creating digital maps for developing countries and creating navigation services, this will also give them first mover advantage, which in turn will create high entry barriers of entry for competitors. An example of this is Garmin’s first mover advantage over TomTom in the Indian market. (Hoffman,