Better Positioning for TiVo

Nancy Sagar – TiVo Positioning Statement page 1

TiVo Positioning Statement

Nancy Sagar ~ Management 472A ~ Friday October 2, 2009

RECOMMENDED POSITIONING STATEMENT

For tech-‐savvy TV-‐loving households who are sick of missing favorite shows, dealing with constant

interruptions, and figuring out the VCR, TiVo is the world’s first Digital Video Recorder, a sleek set-‐

top box that automatically records their favorite entertainment, giving them complete freedom to

enjoy sports, movies, network and cable programming, even news on their own schedule. Unlike a

VCR or DVD player, TiVo recommends programs that they’ll love while storing up to 60 hours of

material so they can watch, delete, fast forward, and replay their collection at whim … even pause

and rewind live TV when the phone rings.

RATIONALE

This positioning statement focuses on the 11.7 million “new enthusiast” households that TiVo should

target at launch (see Exhibit A). Described as “tech-‐savvy early adopters,” these educated, “time-‐

famined” professionals enjoy the highest income ($55,000) of the four segments of TV-‐involved

households TiVo identified. These households are also willing to spend $700 on average for

consumer electronics products – 40% more than the next most affluent segment, a crucial behavior

given TiVo’s price point of $499-‐$999 plus service fees. The new enthusiasts also provide the critical

case studies and word-‐of-‐mouth the company will need to cross the chasm and cost-‐effectively

market to the next logical segment, the 13.7 million “faithfuls” (Exhibit A), a segment of more

conservative, “Middle America” families who are heavily influenced by family and friends in their

consumer electronics purchases.


The Kellogg case clearly identified three major pains that TV-‐watching consumers experience:

inconvenient scheduling, interruptions, and difficulty programming the VCR, so this statement calls

out those problems with gusto. It goes on to herald TiVo as “the world’s first Digital Video

Recorder.” Since TiVo is beating their competitors to launch, they need to trumpet that first position

to have a chance at owning this new category in the mind of its target segment.

They also need to clearly define this new category. While “DVR” isn’t as sexy a category name as

“Personal TV,” it helps alleviate one of the product’s major issues: it’s difficult and expensive to

explain. For example, even after a 10-‐minute demo with a focus group, a moderator still had to

spend another ten minutes explaining the unit. By using a descriptive category name like DVR, the

company provides an important data point that can help translate the product, engage potential

customers, and inextricably link the TiVo brand name to the most anticipated new technology

product category in history.

Finally, the positioning statement needs to hone in on the specific problem-‐solving capabilities TiVo

offers to new enthusiasts. Since these households most appreciate the “cool gadget & schedule

control / time-‐shifting” (Exhibit A) features, the first and second sentences highlight those features

and illustrate the benefits using copy that brings the TiVo lifestyle to life.

• “Sleek set-‐top box” alludes to the product’s cool, “it-‐product” wow factor.

• “Automatically records” refers to the season pass functionality, one of the most popular

product features and differentiates from older technologies (VCR, DVD).

• “Giving them complete freedom to enjoy sports, movies, network and cable programming,

even news on their own schedule” highlights the benefits of the schedule control / time-‐

shifting features.

• “Watch, fast-‐forward, and replay at whim … even pause and rewind live TV when the phone

rings” helps readers visualize – even experience -‐-‐ how the product works.


EXHIBIT A: Segmentation of TV-‐Involved Customers (as presented in the case)

Total US TV-‐owning households: 98 MM TV-‐involved (70% of TV-‐owning): 68.6 MM

(Green = recommended targeting)

New Enthusiasts Faithfuls Surfers Hopefuls

Size (% of TV-‐involved households)

17% 20% 13% 50%

Number 11.7 MM 13.7 MM 8.9 MM 34.3 MM Average Income $55,000 $48,000 $30,000 $30,000 Description Tech savvy, early

adopters; affluent, active, time famine professionals; educated, skews male, but decision is a “family purchase”

Middle America – above average income. TV is the center of the household. Families.

Tech savyy, lower income; just starting out in life, but grew up with technology. Skews single.

Aspire to be like new enthusiasts, but unlikely because lower income & education. Primarily families.

Most appealing feature/benefit of TiVo

Cool gadget & schedule control – time shifting

Saving favorite shows for the whole family to watch together

Show off to friends; Programming/interactive features

Status

Stores shopped for electronics

Specialty Electronics Stores & Mass Consumer Electronics

Mass Consumer Electronics

Discount; Web (including eBay)

Discount & Retail

Average consumer electronics purchase

$700 %400 $400 $200

Exhibit B: Key comments from “Inside the Tornado” chapter 2, p. 15-‐16

Early Adopters = Visionaries. Visionaries have an extraordinary influence on high tech because they

are the first constituency to bring real money to the table. …

And because they tend to love the limelight, they also help publicize the new innovation, giving it a

necessary boost to succeed in the early market. …

No one else in the Technology Adoption Life Cycle has any interest in being first.

Better Positioning for TiVo

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