Neopets Case Analysis Essay

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1. What are the different ways in which Neopets industry can be defined? Do the different definitions lead strategic decision makers to adopt different perspectives/choices? How so? Explain. (10 points) When considering its industry, Neopets is a very unique company. This is because the vision of Neopets executives, especially Doug Dohring, is so broad. First, Neopets could be defined as an online gaming website. This is due to the numerous mini-games that the website offers. Next, is a large submarket of online gaming, the MMORPG, or massive multiplayer online role-playing game. In this submarket users obtain a character, which they are free to customize. Additionally, this character is something they can come back to, and continue in…show more content…
Explain and justify your assertion. Finally, do you believe that these two forces are likely to change in the future? Why or why not? (15 points) First, I believe the buyers to be users of Neopets, and advertisers. I believe the suppliers to be manufactures of Neopets apparel (plush toys, t-shirts, etc.), and hardware suppliers (servers, bandwidth, etc.). The bargaining power for users (buyers) is moderate, as with any website that has low switching costs but relies heavily on web traffic, the customers have a great deal of power. However, given the huge number of users, coupled with the generally younger age of users, I feel that Neopets has the upper-hand. The bargaining power for advertisers (buyers) is low. Neopets is providing an incredibly well targeted and effective advertising medium, giving them a great deal of power. Bargaining power of apparel manufacturers (suppliers) is very low. It makes no difference to Neopets’ users who manufactures the goods, and Neopets surely have large orders to fill. Bargaining power for hardware suppliers is low. Serving its large number of users, Neopets is sure to have a large quantitates of hardware required to do business. With these large quantities, there will be companies willing to cut prices to get their business. I do not believe that the intensity of competition is very high. Neopets has a created a very specialized product that users have become attached to. Like the case states, these are the

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