Capital One Competitor Analysis
A. Competitor Identification – Strategic Groups of Competitors a. Direct Competitors- other credit card companies i. Chase - $165.87 B in revenue and 19% market share ii. Bank of America - $145.10 B in revenue and 16% market share iii. Citigroup - $102.54 B in revenue and 12% market share iv. Others such as American Express, Discover, etc b. Indirect Competitors – companies such as retailers whose core competency is not credit cards v. Target - $7.78 B in revenue and 1% market share vi. Others such as Best Buy, Macy’s, etc
B. Competitor Strengths and Weaknesses: Competitor Strength Grid
Scenario Analysis:
Two most likely are: * Scenario 1: Recent acquisitions do not create added profits * Possible Strategies: * Try to create stronger relationships with customers of the acquired companies who are unfamiliar with Capital One * Create incentives for customers to stay with Capital One after the acquisition * Reevaluate the way that business is managed * Probability estimate: * Since most of the acquisitions have been in similar lines of business they may work well but with the deep recession they may face problems: 60% * Scenario 2: Government proposes increased regulations on credit cards * Possible strategies: * Invest in education to teach people to understand how credit cards work and how to use a credit card responsibly * Try to develop stronger ties with politicians to understand your position and make regulations hurt as little as possible * Develop a new product that isn’t affected by new regulations * Probability estimate: * With credit being a significant cause of the recession, there will likely be more regulation on the industry. The party who wins control in 2012 will probably be the biggest impact on immediacy:
B. Competitor Strengths and Weaknesses: Competitor Strength Grid
Scenario Analysis:
Two most likely are: * Scenario 1: Recent acquisitions do not create added profits * Possible Strategies: * Try to create stronger relationships with customers of the acquired companies who are unfamiliar with Capital One * Create incentives for customers to stay with Capital One after the acquisition * Reevaluate the way that business is managed * Probability estimate: * Since most of the acquisitions have been in similar lines of business they may work well but with the deep recession they may face problems: 60% * Scenario 2: Government proposes increased regulations on credit cards * Possible strategies: * Invest in education to teach people to understand how credit cards work and how to use a credit card responsibly * Try to develop stronger ties with politicians to understand your position and make regulations hurt as little as possible * Develop a new product that isn’t affected by new regulations * Probability estimate: * With credit being a significant cause of the recession, there will likely be more regulation on the industry. The party who wins control in 2012 will probably be the biggest impact on immediacy: