Socially, the needs for cloud communications services; not only businesses but also consumers, provided an opportunity for the founders of Vonage, who capitalized on it.Technologically, the desire of effective organizational communication services also created a business idea for the Company. Many businesses that showed less growth organically, this created a technological opportunity. From this, the company was, therefore, able to build a strong foundation from which these businesses could achieve growth organically. Competitively, the need for iCore operations facilitated the company’s well positioning and efficient integration of the iCore operations into the Vonage platform (Davidson, 2007).
The purchasing patterns have showed declining patterns; it has been experiencing a shrinking target market potential. This is associated with the stiff competition that is heating up between the company and the Grasshopper. The competitors offervery competitively quite innovative unified communication solutions for smaller businesses. Small businesses, therefore, have diverted their purchasing patterns, others seeking preference to the Grasshopper company. The deviations in the purchasing patterns are associated specifically by the Company’s pricing structure; although Vonage offers a relatively more range of extensive pricing options, its lowest price is still giving its competitor a higher purchasing advantage.
On the environmental scan of Vonage provider Company, there are key trends that can influence the Company’s future. These trends are as a result of the environmental forces. For the technological,environmentalforce, there is the demand for hosted telephony services. This is among the small sized to the medium sized businesses. Evidently, this trend is growing at a tremendously high rate. Very many companies in the line of communication have therefore recognized the opportunity as well as the need to major on this trend. They are consequentially offeringtheir hosted Voice over the IP solutions thereby targeting the exploding small sized to medium-sized VoIP markets.
The many companies are much willingtoincrease effectivelytheir revenues as well as margins, but they need various alternatives to the significant capital expenditures. Vonage Company should not be an exception for it to be able to guarantee its future in the very competitive market. In response to this technological trend, Vonage has therefore offered what is knownas a turnkey, cloud-based VoIP platform whereby interested companies can build and at the same time brand advanced business VoIP solutions to start generating revenue in as few as just three months (Cherry, 2005).
On the social environment forces. The demand for more efficient global social networks that can link the social aspects of the small sized to medium sized businesses is as well heating up. Vonage Providers unlike its competitor Grasshopper, has not capitalized on this trend and consequentially, this might have serious repercussions on the business purchasing patterns.
Economically, there is a trend in the pricing structures where most communications providers have employed a large extension of pricing option to choose. Vonage too has a relatively large extensive pricing structure that it offers its target markets. However, concerning the pricing structures, there is the issue of the lowest pricing structures. Since the target market ranges from the small businesses to medium sized businesses, the pricing structures should be in such a way that it provide room for the small price options.
Vonage competitive environmental forcesalso involve the many upcoming numbers of similar competitive communication providers companies. The key trend from Vonage’s competitive environment pertains to VoIP Market Position and Brand. There had been an increasing demand for these quality services. Vonage provider’s major source of its competitive advantage gets much associated with its capitalization on this trend. To the response to this trend, Vonage has evidently high brand recognition that has tremendously enhanced their ability to sell profitably their services through convenient direct and retail distribution channels. This has a consequential effect of allowing them to capitalize on their growing market demand for VoIP and broadband (Norris, 1999).
On regulatory, the trend has been on the innovative and Low-Cost Technology Platform. This has enabled Vonage to therefore to regulate their cost structure about traditional telephone and cables. They have done this by providing for an online billing as well as anautomated payment system.
There are many lessons I can learn from Vonage are many but most evidently is there level of innovation and creativity (Hülsmann & Pfeffermann, 2011). Their unique innovative ways have great significance in effectively achieving a competitive advantage in any business. Vonage has very educative business running strategies that can be employed by the upcoming communication businesses, of all this strategies, I can point out their unique abilities to create an attractive value prepositions while minimizing on cost. The other more evident lesson on their journal is how to effectively augment capacity at a very low incremental cost.
To Vonage, I recommend that they capitalize on the trend revolving the pricing structures. Their ability to improve the purchasing patterns of target markets is much dependent on it. Secondly, on service reputation, Vonage should consider the Installation of virtual phone PBX by the way of a private branch structure. It willget geared towards improving the company’s marketability. Finally, Vonage should consider strategies meant to increase its target market to include the large businesses.
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