Strategy

GYF's revenue is threatened by the rise of ad blocking software. To address this, GYF proposes a multi-strategy approach: 1) Make ads less intrusive by collaborating with advertisers, 2) Gather data on ad intrusiveness and blocker impact, 3) Conduct a user trial of unobtrusive ads to get feedback, 4) Explain to users how free services rely on ads. GYF's strategy also involves a comprehensive analytical model using tools like SWOT, Porter's Five Forces, value chain analysis and more to inform strategic planning.

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Strategy

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kamran burhan

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Business Analytics Capstone

Framework for Strategy

Dhiren Mahboobani
08/05/2023
Problem Statement
Problem Statement–
Describe the Problem Adblockers present to GYF

Adblocker – a computer program that prevents advertisements from being displayed on

screen, from example when you visit a website
• The rising popularity of Ad blocking software presents a potential revenue threat to GYF. Given
that 70% of GYF's income is generated from ads, any increase in the ad blocking software's
usage could adversely impact the company.
• In order to sustain profitability, GYF may need to implement customer charges, which could
potentially lead to reduced usage of their services and a decline in their customer base.
Consequently, this could result in financial losses for the company.
• Both GYF and the companies advertising on the platform will need to invest in finding solutions
to combat ad blockers, which could lead to higher expenses for both parties.
• If GYF cannot display ads to its customers, the companies that post the ads will lose their
incentive to advertise on the platform. Consequently, this could lead to termination by the
companies, resulting in a loss of revenue for GYF.
• In 2015 Apple started shipping with a new operating system that allows users to install software
that blocks banner ads from appearing on mobile web browsers which was marked as one of
the major beginning of this Issue.
• Last year, GYF's mobile advertising sales made up 70% of its overall digital advertising
revenue. The presence of ad blockers poses a significant threat to GYF and other companies
like Google, Facebook, and Yahoo. In 2019 alone, the number of mobile AdBlock users
reached a staggering 527 million.
Strategy
Strategy
Describe your proposed strategy

• Our primary objective should be to minimize the obtrusiveness of ads. Collaborating with the
companies that place the ads, as they are also stakeholders, makes sense to jointly work
towards creating less intrusive and more creative ad experiences. This focus on reducing
obtrusiveness should take precedence as users generally do not dislike ads as a whole; rather,
they have an aversion to intrusive ad formats.
• Relying on a single strategy alone is inadequate to address this issue. Therefore, a multi-
strategy approach is advised. The following strategies can be implemented in order of priority.
• Prior to implementing any strategy, it is crucial to gather data to assess the level of
intrusiveness of the ads and the current impact of ad blockers on GYF's services. This data will
provide valuable insights to make informed decisions and tailor the most effective approach to
address the issue.
• Once the ads have been made unobtrusive, a survey can be conducted specifically targeting
users who employ ad blockers. These users can be invited to participate in a 7-day trial during
which the unobtrusive ads will be displayed. The purpose of this trial is to gather feedback from
the users to determine whether such ads are acceptable to them. This feedback will be
instrumental in understanding user preferences and refining the ad experience further.
• It is crucial to communicate the significance of placing ads to the users. This can be achieved
by explaining to them how GYF is able to offer all its services for free by relying on advertising
revenue. By providing users with an understanding of the relationship between ads and the
availability of free services, they can appreciate the necessity of ads in sustaining the
platform's operations without direct charges to users.
Strategy
Describe your proposed strategy

• GYF's strategy revolves around a comprehensive analytical model that encompasses various
key components:
1. SWAT Analysis: To assess the company's Strengths, Weaknesses, Opportunities, and Threats, enabling effective strategic planning.
2. Porter's Five Forces: To analyze the industry's competitive forces and understand the market dynamics.
3. Value Chain Analysis: To identify the value-adding activities within the company's operations and supply chain.
4. Trend Analysis: To monitor and anticipate market trends, ensuring the company stays proactive in adapting to changing market conditions.
5. Technology Forecasting: To predict technological advancements and incorporate innovative solutions into the company's strategies.
6. Ratio Analysis: To evaluate financial performance and assess the company's overall financial health.
7. R&D Product Manufacturing Analysis: To assess research and development efforts and manufacturing capabilities, guiding product development decisions.
8. Regulatory and Legislative Analysis: To stay compliant with relevant laws and regulations and anticipate potential impacts on the business.
9. Organization and Personality Assessment: To understand the company's internal culture and leadership style, which influences decision-making and strategy implementation.
10. Risk Analysis: To identify and manage potential risks associated with the company's operations and business environment.

By utilizing this comprehensive analytical model, GYF aims to make informed and well-
considered strategic decisions to achieve its goals effectively.