Swot Analysis - Barclay Card
SWOT ANALYSIS - BarclayCard
Summary of Recommendations
Barclaycard has been the first mover in the UK for credit card services. They have intensely used advertisements as the main method of attracting customers using the message peace of mind to attract their customers to use their cards. However, recently many new entrants have entered the market to drive competition up and reduce the value of each Barclaycard credit cards. The following is a list of recommendations that Barclaycard should implement to remain competitive.
1. Barclaycard can introduce credit cards that have a lower APR to compete with the new entrants.
2. To encourage spending Barclaycard can introduce incentive programs to stimulate spending. For example, they can follow Novus® with a cash back program on spending.
3. Discourage consumers from using cash and a main method of payment.
4. Be the first mover again and introduce other programs that allow a consumer’s life to be easier. For example, they can start implementing services where a consumer can pay with their cell phones using the IR feature, or start emplacing smart card technology in retail outlets as this is seen as the next possible trend in the future. Introduce services that allow consumers to purchase things at home with a touch of a button (internet credit cards e.g. one time use cards)
SWOT Analysis*
Strengths
• Market leadership with a market share of 34% in terms of credit cards issued, and 27% in transaction value. *
• Low cost production, resulting from accumulated experience as the first credit card issuer in the UK and economies of scale derived from it high market share. *
• Brand status, the Barclaycard name was almost a generic term for credit card and is widely recognized by consumers. *
• A well-established distribution network, through Barclays Bank, other financial institutions and large retail organizations which made its product available to a wide range of potential customers.*
• IT capability, which
Summary of Recommendations
Barclaycard has been the first mover in the UK for credit card services. They have intensely used advertisements as the main method of attracting customers using the message peace of mind to attract their customers to use their cards. However, recently many new entrants have entered the market to drive competition up and reduce the value of each Barclaycard credit cards. The following is a list of recommendations that Barclaycard should implement to remain competitive.
1. Barclaycard can introduce credit cards that have a lower APR to compete with the new entrants.
2. To encourage spending Barclaycard can introduce incentive programs to stimulate spending. For example, they can follow Novus® with a cash back program on spending.
3. Discourage consumers from using cash and a main method of payment.
4. Be the first mover again and introduce other programs that allow a consumer’s life to be easier. For example, they can start implementing services where a consumer can pay with their cell phones using the IR feature, or start emplacing smart card technology in retail outlets as this is seen as the next possible trend in the future. Introduce services that allow consumers to purchase things at home with a touch of a button (internet credit cards e.g. one time use cards)
SWOT Analysis*
Strengths
• Market leadership with a market share of 34% in terms of credit cards issued, and 27% in transaction value. *
• Low cost production, resulting from accumulated experience as the first credit card issuer in the UK and economies of scale derived from it high market share. *
• Brand status, the Barclaycard name was almost a generic term for credit card and is widely recognized by consumers. *
• A well-established distribution network, through Barclays Bank, other financial institutions and large retail organizations which made its product available to a wide range of potential customers.*
• IT capability, which
Bibliography: 1. LaBarge, Andrea. Pearson: Custom Course Pack, Boston, Massachusetts: Pearson Custom Publishing, 2002. 2. Wheelen, Thomas L. Concepts in Strategic Management and Business Policy, 8th ed. Upper Saddle River, New Jersey: Pearson Education, Inc., 2002. 3. http://www.cardweb.com/carddata 4. http://www.barclaycard.com