A name synonymous with action cameras, GoPro is a market leader in technology associated with extreme sports. We look at the Strengths, Weaknesses as well as the opportunities and threats that the company is exposed to.
1. GoPro has a strong brand value.
GoPro has become synonymous with high-action, extreme sports. The company was the first to bring first-person perspective and point-of-view action to viewers worldwide with their near-indestructible little cameras. This capability coupled with a savvy marketing plan ensured that GoPro has featured in many heart-racing scenes.
GoPro is the most active consumer electronics brand on social media, with 94 million cross-platform actions across social media brand content. (Statista)
2. The company maintains high-profit margins on its products.
Due to the luxurious nature of the equipment offered and the notion that the company continues to provide industry-leading technology, GoPro has managed to retain a high margin on its products. This bolsters the company’s cash flow, which is vital for research and development.
GoPro’s international revenue reached $892 million. (Statista)
3. GoPro offers a diverse range of product offerings.
From robust Action Cameras capable of submersion in water and being thrown down a rocky cliff, or capturing the first-person view of a building demolition from the rooftop, to high-tech drone equipment and image stabilizing gear, GoPro’s hardware range is extensive. Its software capabilities are also incredibly powerful.
GoPro shipped more than 2.8 million units in 2020. (Statista)
4. Strong marketing strategies ensure a strong brand image.
GoPro branding can be seen on most helmets, fenders, canopies, surfboards, and dive tanks of extreme sports. Furthermore, its watermarking from editing software ensured the presence of the brand across amateur users as well. This leads to a rise in consumers who purchase the product for personal use.
GoPro spent $151 million in marketing and advertising, more than any of its competitors. (Statista)
5. GoPro has many patents in the United States.
A sign of a solid innovative future, GoPro has an active list of patents relating to the technological direction of the company. This patent gauge gives a good indication of a company’s research and development department. Technological advancements are essential for GoPro to maintain a strong marketing position.
163 patents were issued to GoPro in 2020. (PatentBots)
6. GoPro offers world-leading camera technology.
As its primary function is to capture excellent footage in a wide range of environments and circumstances, GoPro has ensured that the quality of its camera sensors is top of the range. As a result, these products are even used in big-budget feature films, such as Ridley Scott’s The Martian (2015).
GoPro’s flagship Hero 9Black has a 23.6-megapixel sensor. (Condé Nast)
7. GoPro has managed to generate substantial online sales.
As the world has moved away from brick-and-mortar space toward more of an online retail experience, GoPro has managed to begin to generate more of its sales revenue from online sales. Although it’s a good start (albeit a bit late), the company needs to expand on it.
GoPro’s sales through its GoPro.com platform doubled in the year 2020. (Statista)
1. GoPro’s could more aggressively pursue research and development.
As a company defined by cutting-edge technology, GoPro needs to ramp up its innovation to ensure its competitors do not infringe on its market position too much. Technological innovation is a differentiating factor for GoPro’s products. It, therefore, needs to ensure that it maintains this.
GoPro spent $132 million on research and development globally in 2020. (Statista)
2. Poor financial planning is a key weakness.
With regular losses posted, the financial planning of GoPro is a fact that undermines the company’s longevity. A stricter financial planning regime will open up needed budgets for research and development, as well as for expansion.
GoPro posted a net loss of $67 million. (SGB Media)
3. GoPro has an overreliance on the North American Market.
GoPro has not addressed Asian, European, and African markets. This weakness is an opportunity for the company to drive growth into these markets.
GoPro derives $483 million from the North American Market. (Statista)
4. GoPro’s products are expensive compared to its competitors.
With its image allowing a premium price point, GoPro is seen as a premium quality market leader. This excludes more cost-conscious consumers who are looking for a more budget-friendly model.
13.4 million action cameras were sold in the year 2020. (Cision US Inc.)
5. Due to high parts cost and the cost of the finished goods, GoPro has high inventory costs.
GoPro utilizes cutting-edge technology, as well as premium material and parts in its manufacturing processes. This means that there is a lot of capital held up in its inventory, especially as finished products.
GoPro maintains $25 million in inventory. (GoPro)
6. Slow and cumbersome third-party integration remains an issue.
GoPro has ensured that its proprietary software and accessories get the limelight when it comes to post-purchase add-ons. This has left little opportunity for the third-party manufacturers to create products that complement GoPro’s capabilities.
GoPro has 400,000 premium subscribers on its platform. (NYP Holdings, Inc.)
1. Diversification into smartphones offers the company an easy expansion route.
Camera Technology is a big part of product differentiation in the smartphone industry. With GoPro’s existing offerings, it should be straightforward to compete in this world. This will give resistance to the encroachment of the smartphone industry on GoPro’s market.
The global smartphone sales market is worth $409 billion. (Statista)
2. The gaming industry should be easy pickings for GoPro.
GoPro’s immersive editing software and virtual reality capabilities offer the company the chance to compete in the Gaming Industry. Considering GoPro’s accessory range, it provides the company to develop new virtual reality and augmented reality offerings.
The global gaming industry is worth $300 billion. (GPlusMedia Inc)
3. Sports in the emerging markets are set to boom in the coming years.
Sports are a big cultural aspect in many developing countries. The rise in technological adoption and penetration offers GoPro a foothold in these markets and the opportunity to be a part of the popular culture of these regions.
The global sports industry is expected to be worth $600 billion by 2025. (Cision US Inc.)
4. Historically weak online sales offer new retail avenues.
With a legacy of brick-and-mortar sales and a strong presence in retail shops in North America, GoPro has relied on physical retail paths. Developing online sales offers new growth for GoPro.
United States Computer and Consumer Technology consumption is worth $156.5 billion in 2020, with 49.5% of its transactions concluded online. (Insider Intelligence Inc.)
5. Philanthropic causes offer GoPro good marketing exposure.
GoPro’s cameras are perfectly suited for catching footage in remote locations, often in hostile environments. These environmental conditions are often associated with non-profit work. This work can be associated with humanitarian efforts, a well as wildlife conservation and exploration.
GoPro For A Cause has reached 66 million people worldwide. (Shorty Awards LLC)
6. Emerging markets beyond the United States promises untapped marketing opportunities.
GoPro has historically focused on the North American market, leaving the Asian, European, South American, and African markets largely unaddressed. As a result, this offers an excellent opportunity for expansion within these sectors.
65% of GoPro’s revenue originates from the North American market. (Statista)
1. Cheaper competitors challenge GoPro’s market position.
As GoPro has positioned itself as a premium brand, it has all but neglected the more cost-conscious consumer base. As the cost of cutting-edge technology decreases, this offers the possibility of its competitors taking up this market position.
The action camera market is expected to grow to $10 billion by 2026. (Statista)
2. Inter-governmental disputes make it challenging to operate in multiple geopolitical areas.
With GoPro manufacturing in one region, and predominantly selling in another, this disparity opens the company to the risk of geopolitical conflicts, such as the US, China trade wars. In response to this, GoPro shifted its manufacturing capacity from Asia to Mexica.
$300 billion worth of consumer electronics are subject to the trade war between China and the United States. (Reuters)
3. Smartphone technology is becoming more of a competitor.
As smartphone technology improves at an incredible rate and smartphone manufacturers continue to seek to differentiate their products from their competitors, they make more and more rugged phones with captivating camera capabilities.
Apple’s iPhone 11 features a camera capable of shooting video footage in 4k High Definition, with a 12-megapixel, wide-angle camera capable of slow-motion footage. (Motley Fool)
4. There is increased competition for GoPro’s brick-and-mortar distribution model.
Consumers are purchasing their electronics online. However, GoPro has historically focused its sales channel on brick-and-mortar sales and neglected its online presence. Although online sales have picked up recently, it should focus more on these channels.
50.5% of North America’s Consumer Technology purchases were performed in brick-and-mortar establishments. (Insider Intelligence Inc.)
5. There is limited growth due to a lack of succession.
GoPro’s senior executive roles are still fulfilled by its founding partners. While this is good for control over the company’s direction, it means that the best person is not necessarily doing the job. New blood might offer the company new growth in its markets and fresh perspectives on potential markets.
GoPro is still controlled by its founder, Nick Woodman. (MarketWatch, Inc.)
With declining sales, and vulnerability from competitors, as well as new technology, GoPro has its work cut out for it. Can it lean on its strong brand image, diversify and enter new markets? Time will tell.
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