Beats by Dre

SWOT ANALYSIS
Strengths Weaknesses

High popularity Low quality

Trendy and fashionable characteristics (compared with other brands in similar price )
“Beats Music”offers a music library of over Bad after-sales service
20 million songs Weakness of core technology

Earphone becomes one of 
 High competition

life necessities Rapid change in technology
Appearance is an important element Customer’s willingness to pay is not strong
when customer make choice because of high price

Opportunities Threats
 Poter‘s Five Forces
Threats of New Entry
Medium Pressure

Beats’ market position is high-end music headphone/earphone.

Customers are able to switch and use other products as they like with
no cost. Thus, the market competition pressure is high.

The market share of headphone/earphone is quite settled, which makes

it hard for new brands to acquire satisfactory share of the market.

But there are niches such as gaming headphones(e.g. headphones

designed for PlayerUnknown's Battlegrounds (PUBG)) and live streaming
headphones — those are opportunities for new brands to enter the
indurstry.
Poter‘s Five Forces

Threats of Substitutions
Speakers & Embedded Speakers

Low Pressure

There are few subsititutions which

can provide the same functions
and convenience as earphones.
Poter‘s Five Forces
Intensity of Rivalry among Established Firms
High Pressure

Many competitors exist in this industry: not only those brands whose
price is similar with Beats, but also those which can be quite cheap own
their market shares.
 Poter‘s Five Forces

Bargaining Power of Customers

Low Pressure

Beats has a lot of consumers because it

is affordable and payment can be made
by installments. And Beats has many
distribution channels online and offline
(including Apple).
 Poter‘s Five Forces

Bargaining Power of Suppliers

Low to Medium Pressure

Many factories are available and our

orders are usually welcomed by them.
But not all of them can provide qualified
technics for specific shape, lustre, and
color requirements, etc, which we need
for our products so we would choose
better ones.
 Current Market

Earphone Tier 1 Tier 2 Tier 3

Fancier

Someone who are interested in

high-grade earphone

Someone who does not care about Someone who does not have the
earphone habit of using earphone
 Designedfor: Designedby: Date: Version:
TheBusinessModelCanvas

KeyPartners KeyActivities ValuePropositions CustomerRelationships CustomerSegments

• Selling premium
headphones, • Acquisition 


Business earphones and (new customer)

• Suppier speakers • Retention 

• Distributor • Subscription-based (existing customer)

Canvas
• High quality product
• Ad platform online music streaming
• Fashion identity • Young generation
service
• Identity • Music lovers
• Fashion-hunting

KeyResources Channels

• Apple Store
• Distribution network
• Online store(Apple,
• Brand Taobao)
• Ad coorperation • distribution (e.g. CD
• Online music copyright Warehouse, Broadway,
HKTV Mall)

CostStructure RevenueStreams

• Raw material for product production

• Product sales
• Product Rearch&Development
• Online music subscription-Music copyright sales
• Distribution
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The Strategy Canvas of [Beats]

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Average Point
Strategy
Ocean

Beats
Apple
Bose
Blue
 The Strategy Canvas of [Beats]
• Selling premium
headphones, • Acquisition 

earphones and

Blue
(new customer)
speakers • Retention 
 • Young generation
• Subscription-based (existing customer)
• High quality product • Music lovers
online music streaming

Ocean
• Fashion identity • Fashion-hunting
service
• Identity

Strategy

Average Point
Beats • Product sales

Price Appearance Publicity Durableness

• Online music subscription-Music copyright sales
The Eliminate-Reduce-Raise-Create Grid

Eliminate Raise

price Channel of Distribution

Appearance
Product Segmentation

Tone quality Publicity

Durableness Music copyright

Reduce Create
Thank You