How a lack of Passion and Too Few Customers Can kill Business

“What Went Wrong”

“How a lack of Passion and Too Few Customers Can kill Business”

Introduction

Youcastr was founded in the 2006 by three friends, Ariel Diaz, Jeff Dwyer and Jay Peak while travelling by road. Youcastr was introduced into the market as a media platform that was created to provide sporting fans with an opportunity to stream their comment on live matches.

The failure of Youcastr

The purpose of this study is to analyze the factors that led to the failure of Youcastr and the procedures and precautions that can be undertaken to avert a similar occurrence in future.

Overview of the paper

Youcastr was a firm that was registered by three friends with a view of partnering and offering live media streaming of comments of spectators watching live matches. They spectators were to pay for these services which were tailored to be like hire school football games that attracted a lot of fanatics who were passionate about some sports. But after two years the profits were not sustainable and the company had to fold up. This paper examines the factors that led to its failure and the necessary steps that should have been followed during its launch to avoid its failure or the steps that may be required to revamp it. The failure of youcastr can largely be attributed to the management skills of its managers. Before commencement of the business, the managers of the firm didn’t conducted a clear market research to identify the target group of its products and the strategies to exploit the market. The issue of lack of customers would not have arisen if proper research had been undertaken. The feasibility study would have revealed whether the market available for the service was sustainable.

There several methods of raising business financing. One of the most common ways is to obtain bank loans. This option is available to business that are already in operation and the banks normally require banking records of the business to determine its credit worthiness. However, an entrepreneur who has adequate collateral and has some clear and convincing business plan can present a formidable case to the bank for consideration.

Another form of business financing is to borrow money from relatives and family members. The company can then be a private company that has the family members as the debtors. Its known as debt capital.

The other method is through savings or contribution from friends and relatives. This method can also attract potential shareholders who can sponsor the project in exchange of a certain amount of shares in the company. It’s known as venture capital.

To provide the basic information of the existence the Youcastr, the company must come up with a marketing communication strategy that will involve making key decisions about who the customer is, how they will be contacted and what kind of message should be conveyed. For instance, Youcastr targets different distinct groups depending on the comment and the type of sports. This process, known as market segmentation divides the market into groups which are very distinct from each other. The importance of market segmentation is that it increases the efficiency in marketing operations by narrowing the market specifically toward a designated and defined segment in a way that is consistent with the characteristics of the segment. Market segmentation leads to product differentiation from each segment while tangibly or intangibly differentiating it from the rival products from the competitors. (Blythe, 2008)

Target market involves the identification and the development of brands as the selection and images of the company’s services. The combination of all the required elements of marketing mix is needed to achieve the required strategy. Identification of the target market explains the uniqueness of the services in the market place and also its advantages against the other social media firms. Branding is a tool that is often utilized to position the product by designing and composing its marketing slogans and marketing promotional materials. For any communication to be effective, the customers must form a picture mentally about his perception of the service which eventually influences its sales. Brand equity occurs where customers are willing to pay much more for a service because of its position. (Kotler & Armstrong, 2010)

Intellectual property rights refer to the rights that are awarded to a person for their creativity using their minds. The creator is given exclusive rights over his creation and its use of a certain limited period of time.

Copyrights refer to the rights of the authors for their literary or artistic work. For example, paintings, sculptures, books, musical compositions or even computer programs are normally protected for a period of 50 years or more.

Trade secrets are mostly information or formula’s that companies prefer to keep secret so as to gain advantage and benefit more their competitors.

Trademarks protect names, words, symbols, goods, services, sounds or colors. These products are registered and protected by the law as belonging to the registered users only.

A patent is a duration that is limited for a right that relates to an invention that has been granted by the US patent and trademark office for its disclosure.

Passion is critical to the success of an entrepreneur as it’s the driving force and motivation of the businessman. Passion forms the basis of success as the entrepreneur faces a lot of challenges in the course of the business operations and it requires a passionate heart and love for the business to nurture its initial growth until it reaches maturity and can ultimately start paying off its dividends.

To conclude, the ultimate aim of the market segmentation is to create a demand for the service among the potential clients who will eventually be attracted by the product or service. The marketer believes that the strong demand created will pull item, product or service by compelling the marketing intermediaries to accommodate it through the marketing channels.

References

Blythe, J. (2008) Essentials of Marketing. 4th edition. Essex: Pearson Education Limited.

Kotler, P. & Armstrong, G. (2010) Principles of Marketing. 13th edition. London: Pearson Education Ltd.