Question

1. Based on the CEO Mooney’s standard for success in make sure beginners stick with their guitars, develop a planning/control cycle to make sure Fender is headed in the right direction.

Fender Rebrands to Stay in Tune with the Times Fender Musical Instruments Corporstion produces some of the most recognized electric and bass guitars in the world. The organization was one of the first to mass produce guiters and has an illustrious history dating back to the late 1940s. Fender's guitars revolutionized popular music by allowing smaller groups of musicians to play together. 61 Today, these small groups include megastar customers like Eric Clapton, Sheryi Crow, and U2. With stars of this caliber using Fender guiters on stage, you might imagine business is booming. Sadly, it is not. Fortune reports that Fender "spent the better part of the past decade struggling with debt and a lack of growth, and in 2012 abandoned an IPO, citing unfavorable market conditions.62 Andy Mooney was hired as CEO in 2015 to turn around the company. Let's consider his plan. A NEW PLAN FOR AN UNRELIABLE CONSUMER Fender began its transformation by coming to terms with the high quit-rate of beginning guitar players. According to Mooney, "Almost everyone who picks up a guitar, about 90 percent, abandons it within the first year.63 There are two main contributors to this dire statistic-the method of learning the instrument and the cost associated with doing so. Fender's plan focused on how amateur players preferred to learn. Ethan Kaplan, Fender's general manager of digital, noted that "The way that I learned piano when I was a kid is no longer the way most people learn. They sit at a computer. They sit on an iPhone. They do things in little bites versus sitting through hourlong lessons.64 Mooney and Kaplan's assessment of Fender's current reality provided crucial insight into the cost of lessons. According to Fortune, new players spend four times as much on lessons as they do on the instrument." 65 The company's plan to overcome these challenges was based on experimenting with different apps. The plan strives to ensure that beginning guitar players can casily use digitized materials to quickly learn how to play guitar at a reasonable cost Fendcr's first app was Fender Play. This subscription-bascd app can be used on a mobile device as a way to assist a "do-it-yoursclf" society learn how to quickly play the guitar. The app uses bite-sized, multi-angle video lessons focused on helping new players learn popular songs. A professional guitarist provides step-by-stcp lessons in the vidcos, and players can track their progress in the app. Beginners quickly learn how to play a familiar song from bands such as the Rolling Stones, Foo Fighters, Tim McGraw, and Coldplay. They will be less likely to quit once they achieve this milestone and more likely to buy more Fender guitars in the future. 66 Players will also be spending much less than they would have with private lessons, since the subscription costs only $20 a month. The software may not be for everybody, though. As Business Insider reports, "No program of instruction will be perfect, and Fender Play isn't going to work for everyone. And for those who don't like it, there are many free options on the web, and you can always hire a real, live teacher!" Obviously, Fender cannot rely on a one-product-fits-all plan. The company has developed additional apps to speed up the learning process. For example, Fender developed Fender Tune to teach players how to tune a guitar without having any level of proficiency. "When the kid plugs [the guitar] in for the first time, it doesn't sound like a screaming cat when it comes out of an amp," according to Mooney. 68 Fender is also looking to relcase a practice-room app that can assist somcone in playing any song in its music library. This provides an opportunity for amateur players to practice and develop their skills. Another app lets an amp emulate the sounds of famous guitarists. The company's newest amp model will be able to connect to this app wirelessly, through Bluctooth, so players can alter and share sound effects." 69

Answer 1

Fender is headed in right direction or not with help of Digital Platform :

New Technology , Digital Platform , Cloud computing , Internet on Things – all are very common word in present IT environment . We need to move out completely from Analog area and need to enter into complete digital arena to sustain business , to maintain growth and to meet with competition .

Background of Fender Musical Instrument Corporation – Old days they produced the best and most recognised electric and base Guitar in the world . Their best product used by megastar player like Eric Clapton , U2. But Situation change , change in human thought , Now a days young generation wants everything should be very cost effective and easy to learn . they can not spend hours and hours to understand any matter .

Fender Corporation understands the above issue and they strategically developed in business environment under IT world. Company suddenly facing tremendous issue like about 90 % guitar has been abandons it with in first year , which create tremendous bad impact on bottom line .

To overcome the above problem , management team of Fender Corporation , implement different Apps. The plan and strategy is very clear . They are trying that with help of this apps beginner can easily learn guitar under digital environment with cost effective way .

Introduced first app in the name of “ Fender Play” . Management introduced subscription base app

This app can easily fit into Mobile and guide as “ do it yourself” .

Interesting part to note that , Management of the company started thinking and inviting New Innovation . They understood that without nee thought , Innovation, this OLD based company not able to survive .

With help of Innovative idea , they developed app with smart features like “ bite –sized , Multi angle video lesson, learn popular songs,

Introduced on line classes like a Professional Guitarist provided step by step lesson through video . App will help learner to provide result oriented progress report .

Change in thought process further and they never stick / reply on a One products fit for plan .

They are keep on introducing new product to maintain sustainable growth and meet tough market condition

They develop new app, “ Fender Tune” teach player how to tune guitar without having a level of proficiency .

They further in the process to develop “ Practice –room app” , this app will connect player with Music library .

Truly Inspiring method of Technological development . They are always in Innovation mode and keep on adding

Multiple user friendly apps to maintain and sustainable business growth.

Financial Impact ( Bottom Line position ) :

Higher Management more concern about 90% abandonment statistic.

Their focus is atleast 10% increase in the number of beginner who can stick with Guitar and it could be double size of its Instrument business.

Product upgrade ( Cheap guitar to fancier Guitar ) – will boost up revenue growth and positive impact on bottom line

Management introduced subscription model to generate steady revenue instead of one time generation of revenue

Management improve sales with help of Digital Evolution . CEO still feel that a class of customer need to touch , feel and play a guitar before they buy . So Market is still mix of analog and digital public base .

Market analysis is saying “ there is change in Music “ people are not liking electric guitar , they are started liking Rap and Pop Charts . But Management of the company pointed out that this shortfall can be compensated with “ More women are playing guitar “

Overall , I must say Management ( CEO) has clear strategic plan, Visibility , innovation , happily accept new technology , Majority part they are out from Analog environment – all this factor help company to maintain sustainability and maintain Growth .

With help of above factor , Company management able to maintain Sales Growth plus Bottom line