Cookpad strategy final

1

Business Strategy I“COOKPAD”

2

Mission:

“Make everyday cooking fun”

•Japan’s largest recipe site that lets upload and search original or self-

created recipes.• Listed company which went public on the Tokyo

Exchange Market (07/2009)

•Which recipe site do you use most frequently?”

-80% of users answered “COOKPAD”

Source: Survey from Nikkei Research Institute of Industry

and Regional Economy

3

Broad Low- Cost

StrategyBroad

Differentiation Strategy

Narrow Low - Cost Strategy

Narrow Differentiation

Strategy

Strategic Model of COOKPAD

20 million registered

users

(as of 07/2012)

1,2 million registered

recipes

4

Quality of

Service

Quality of

Service

Variety ofOffers

Variety ofOffers

Social Networking

System

Social Networking

System

Advanced Technologies

Advanced Technologies

Business ModelBusiness Model

COOKPAD

5

Net Sales 3,544

Operating Income 1,875

Net Income 1,151FY2012 Q3(9 months)

17,02MillionMobileusers

13,88Million

PC Users

32% Income/Sales

6

Highest sales in the company’s history

303

413390

480

420452

485

542 558 583638

681727

775

Q1 Q2 Q3 Q4 Q1 Q2 Q3

Advertising Premium Services

（ ¥ million ）

Source: Cookpad reports FY2012

20122011

7

General External EnvironmentPolitical Environment Corporate tax is high in Japan

Economic Environment AbenomicsDepreciation of the yen

Social Environment SNS is spreadingWeb search became commonWomen’s social participation (Sharing house works with men)Safety and health conscious of food

Technological Environment Share of Smartphone is increasingSupply chain management

Demographic Environment Aging societyBaby boomers is retiring

Specific International Events Depreciation of the yen

8

Five force analysis

Number of membership and recipes is overwhelmingHigh awareness and satisfaction of Web siteOther recipe site

Switching cost highMany IT service providers

Switching cost is lowNo comparable competitor Oligopoly

Capital investment is lowSimple business modelNumber of membership and recipes is overwhelming

BooksMagazinesTVrestaurant industry

Buyer power

Supplier power

Threat of substitutes

Threat of new entrants

Segment Rivalry

AdvertiserUserweak

sl.weak weak

neutral

sl.weak

9

VRIO Framework

Brand & First Move Advantage

Customer Awareness / Preference

Customer Satisfaction / Beyond Customers' Expectation

Large Number of Recipes

Simplicity / Usability

Internet TechnologyShort Click Response Time

Accuracy of Search Function

Big Data Analysis

Ruby / Open Source Web Application Framework

Business ModelEasy to imitate the Business Model

Need Time, Capital, and Technology to catch up

Structure & Control Mechanism

Strong Leadership of Founder

In-house Technology Development

Homogeneous Background of Management Team

Value : High Rarity : High

Imitability : Medium Organization : Medium

10

Evaluation of Cookpad's Current Strategy

Cookpad's diffentiated service creates customers preference. Customer preference allows Cookpad to make above normal

profits Cookpad's diffentiated service generates competitive

advantage. Cookpad's service differentiation strategy is well implemented

through the organizational structure and control.

VRIO criteria verifies Cookpad's service differentiation strategy.

11

SWOT AnalysisHigh awareness and satisfaction of Web site

Number of membership and recipes is overwhelming

Market leader position

Technological excellence (short response time, etc)

Simplicity

Less diversification in business

Too much reliance on the founder/top management

Rapid expansion/Recruit of good engineers/Burden of investment for the future

Increase of paying members

Other potential segments

Alliance with Facebook

Globalization/Overseas market

Many potential customers (men, young age)

Women’s social participation/Sharing housework with men

Safety and health consciousness of food

Simple business model

Service obsolescence

Relatively low entrance barrier (Simple business model, less capital intensive)

Possible entrants

ＳＯ

ＷＴ

12

• A platform business based on FOOD

Customer experiences

-Tons of Food

recipes-

Premium services

Marketing support

Advertising

Analysis of Cookpad strategy

PlatformStable and growing market

Want more information!

Want to know customers’

needs!

Want effective

ways!

13

• Two options for alternatives

Strategic alternative

Time to expand

their business!

Globalization

Diversification

Current business in Japan

Go global with

current business

Synergy with other

businesses and targets in

Japan

Synergy globally

Growth in overseas

A risk of saturated paid users among low diversification

14

Strategic alternativeMission statement

Make everyday cooking fun

Globalization

Important resource

Should choose people who have• high community

sense in SNS• high sympathy

to Japanese food

is a country which has• the highest usage of

SNS about Japanese foods

• the highest number of people who like Japanese foods the best

JETRO report 2012Customer value

15

Strategic alternativeMission statement

Make everyday cooking fun

Diversification

Should aim• To target new

segments (age and men)

• Service expansion

16

Sales Forecast (5-year)

5-year forecast

Assumptions1. Adverting business will steadily grow at 5%2. Premium service market will be saturated and slow down3. Capture 1% of Korean people (age 25-35) and grow at 20%4. Sell 1,000-yen book to 10% of premium members

2012 2013 2014 2015 2016 2017 2018 -

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Diversification

Globalization

Premium Services

Advertising

17

Broad Low- Cost

StrategyBroad

Differentiation Strategy

Narrow Low - Cost Strategy

Narrow Differentiation

Strategy

Strategic Model of COOKPAD

20 million registered

users

(as of 07/2012)

1,2 million registered

recipes

New Strategy

18

Backup

19

Value Chain Analysis

SupportActivities

OperationsManufac-turing

Inboundlogistics

Outboundlogistics

Marketing/ Sales

After salesservice

Firm InfrastructureHuman Resource Management

Technology DevelopmentProcurement

Margin

20

21

22

23

24

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