Freakomon Company: Case Study on Market Entry and Strategic Analysis

This case study examines The Freakomon Company's (Freakomon) challenges in launching a new video game controller, codenamed 'Rashomon,' with the vision of expanding its customer base across different demographics. The analysis includes an overview of the competitive landscape in the early 2000s, the cyclical nature of the video game market, and the importance of leadership support. It identifies internal and external stakeholders and their interests in the product's success. Using Porter's Five Forces model, the study assesses Freakomon's competitive position, highlighting the company's advantages due to its innovative product and the relative bargaining power of suppliers and buyers. The study also provides recommendations for leveraging cloud-based information systems (IS) and information technology (IT) to improve customer relationship management, facilitate data accessibility, and address customer queries efficiently, supporting Freakomon's expansion goals.

Section A
Questions Part 1:
a. Introduction:
The case talks about the ideas, plans, challenges, threats etc. that Ryotaro Kurosawa, president of The
Freakomon Company (Freakomon) is facing in the introduction of a new video game controller in the
market. The vision of the company is to expand its customer base in the gaming industry which is
codenamed as ‘Rashomon’. They are trying to introduce such a product that can be used by all sections
of people like women, children, adults, etc. and the game is not limited to the teens and young men
only. In context of this vision, the document contains an analysis of the competitive trends in this
industry in the early 2000s because the company is pioneer in such a product. The document also talks
about the periodic market cycle of the video game. Since no new product can be introduced without the
support of senior management people so the leadership of Kurosawa is mentioned and the aims of
‘Rashomon’ too.
b. The stakeholders
In the above diagram, the internal stakeholders are affected by this new product. The motivation,
success and promotion of the employees depend on the success of this new product in the market.
Similarly, the manager has the responsibility of managing people so that they deliver their best and
make this move a success in the market. The owners of Freakomon are concerned about their long term
growth and success which is related to this launch of the product.

In the same way, the external stakeholders are associated with this because the customers are directly
benefitted if they get this product, they will get something new, shareholders will invest in building this,
creditors lend their money for successful launch and production, etc.
c. Competitive position of Freakomon using Porter’s Five Forces Model
Forces Competitive
position
Reason
Bargaining power
of suppliers
More/High No other company had ever released such a controller and it was
altogether a different model. So, it could have an advantage of a
monopolist in the market and hence it can bargain with the buyers
as they do not have the option of buying this from any other
supplier.
Bargaining power
of buyers
Less/Low The competitors of Freakomon like Sony, Microsoft etc. did not
introduce any such thing in the market, nor were they planning to.
So, the buyers did not have the option to buy the similar product
from any other company. They had only one choice if Freakomon
introduces this new concept in the market. So, they had relatively
less bargaining power. The prices would be non-negotiable between
the buyers and Freakomon.
Threat of new
entrants
Less/Low The barriers to entry in this gaming industry are high. This is because
the established players in this industry like Sony, Microsoft and
Freakomon have invested largely in this industry. So, the new
entrant will have to arrange for huge capital to enter this industry.
Also, the existing players have well-established distribution
networks and huge customer base which is very difficult for a new
entrant to capture.
Threat of
substitutes
Less/Low The company Freakomon does not have threat of substitutes
because it is introducing this kind of product for the first time in the
market and no similar products will be introduced in the short run.
However, with the advancement in technology and replication of
the model, other companies may also come up with similar or better
products.
Industry rivalry More/High Freakomon has many big competitors like Sony and Microsoft who
are well-established players. They have established the trend of
targeting the young fans in this industry. Also, they have advanced
technology and huge networks of distribution. So, they create rivalry
in the industry.
d. Recommendation for information systems (IS) or information technology (IT) that could support
Freakomon’s approach to improve its strategy:
Freakomon should use cloud based technology so that it can successfully manage its customer
relationships. The vison pf this company is related to expansion of its customer base and it aims to
target many different sections of the people. So, for this, the company needs to establish its
relationships with the customers so that they get interested in this innovation and they easily accept this

product in the market. With the cloud based technology, the data of the consumers can be accessed
from anywhere, the data can be maintained easily, and the customers can be reached easily. If they
have any queries, it can be addressed and the solution can be uploaded on cloud so that if any similar
query arises, the cloud based technology can be used to rectify the problems and take care of the
customers (Feng, 2011). The data can also be shared within the networks easily and the access will
provide with the complete information about the users of the product, the potential customers and the
existing ones can be handled with care too.

References:
Feng, D.G., Zhang, M., Zhang, Y. and Xu, Z., 2011. Study on cloud computing security. Journal of
software, 22(1), pp.71-83.