Strategic Growth Recommendations for Sea World Parks and Entertainment, Incorporated in the Amusement Park Industry

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Introduction

As a Strategic Management consultant, this paper aims to perform a comprehensive analysis of Sea World Parks and Entertainment, Incorporated, a major competitor in the Amusement Park industry. The analysis will include a SWOT analysis, an assessment of the industry’s relative attractiveness using IBISWorld , and the application of the G.E./McKinsey Matrix to determine whether the company should pursue a “Grow” or “Hold” strategy. Finally, the Model of Grand Strategy Clusters will be used to recommend a grand strategy, supported by justifications.

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SWOT Analysis: Strengths

  1. Extensive strengths: Sea World Parks and Entertainment, Incorporated, possesses numerous internal strengths, including a solid image, emerging market share, excellent cash flow, and a low long-term debt-to-equity ratio (IBISWorld, 2023).
  2. Attraction and retention of top talent: The company’s ability to attract and retain the most talented people in the industry enhances its competitive advantage (IBISWorld, 2023).
  3. Excellent marketing approach: Sea World Parks and Entertainment, Incorporated, has a successful marketing strategy that contributes to its brand recognition and customer loyalty (IBISWorld, 2023).

Weaknesses

  1. Overreliance on marketing: Although the marketing approach is strong, there might be an overemphasis on marketing as the primary growth driver, potentially neglecting other crucial aspects of business development (IBISWorld, 2023).
  2. High operational costs: The amusement park industry is capital-intensive, and high operating costs may pose challenges in maintaining profitability and cost-effectiveness (IBISWorld, 2023).

Opportunities

  1. Market expansion: The amusement park industry still holds untapped potential in various regions, providing opportunities for Sea World Parks and Entertainment, Incorporated, to expand its presence (IBISWorld, 2023).
  2. Diversification: The company can explore diversification into related industries or introduce new attractions and experiences to attract a broader customer base (IBISWorld, 2023).

Threats

  1. Competitive rivalry: The amusement park industry faces intense competition, requiring constant innovation and differentiation to stay ahead (IBISWorld, 2023).
  2. Changing consumer preferences: Shifting consumer preferences and demands may require continuous adaptation to meet evolving expectations (IBISWorld, 2023).

Industry Attractiveness

 IBISWorld data indicates that the Amusement Parks industry has experienced steady growth over the past few years. The increasing consumer spending and improving economic conditions have positively impacted the industry. However, it is also essential to note that the amusement park industry is sensitive to economic fluctuations, and external factors like geopolitical events and environmental concerns can affect consumer behavior. Overall, the industry presents an attractive opportunity for growth, but it also demands adaptability to external challenges (IBISWorld, 2023).

G.E./McKinsey Matrix

 Based on the SWOT analysis and industry attractiveness, Sea World Parks and Entertainment, Incorporated, falls into the “Grow” quadrant of the G.E./McKinsey Matrix. The company’s internal strengths and the industry’s attractiveness suggest that pursuing a more aggressive growth strategy would be beneficial. By capitalizing on its strengths and opportunities, the company can expand its market share and remain competitive in the industry (IBISWorld, 2023).

Recommendation

 The Model of Grand Strategy Clusters recommends that Sea World Parks and Entertainment, Incorporated, should pursue a Market Penetration strategy with a focus on product innovation. This strategy involves increasing market share in the existing markets and attracting new customers through innovative attractions and experiences. By continuously updating its offerings, investing in new and exciting rides, and introducing unique entertainment options, the company can retain its existing customer base while enticing new visitors (IBISWorld, 2023).

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Justification for Market Penetration Strategy with Product Innovation:

  1. Leveraging Existing Strengths: Sea World Parks and Entertainment, Incorporated, has a strong market position and a solid image. By focusing on market penetration, the company can leverage its brand reputation and marketing expertise to attract more visitors to its parks.
  2. Capitalizing on Emerging Market Share: As an emerging player in the amusement park industry, the company has the potential to capture a larger share of the market. Market penetration will enable Sea World Parks and Entertainment, Incorporated, to capitalize on this opportunity and gain a competitive edge over rivals.
  3. Continuous Attraction of Top Talent: Pursuing a product innovation strategy will further attract top talent in the industry who are passionate about creating cutting-edge experiences. The company’s ability to retain and engage skilled professionals will lead to a sustained competitive advantage.
  4. Meeting Changing Consumer Preferences: The amusement park industry experiences evolving consumer preferences and demands. By focusing on product innovation, Sea World Parks and Entertainment, Incorporated, can adapt to these changes and deliver unique, memorable experiences that resonate with customers.
  5. Enhancing Customer Loyalty: Through innovative attractions and experiences, the company can strengthen its relationship with existing customers, encouraging repeat visits and fostering customer loyalty.

Conclusion

Through the SWOT analysis, industry attractiveness assessment, G.E./McKinsey Matrix, and Model of Grand Strategy Clusters, it is evident that Sea World Parks and Entertainment, Incorporated, should adopt a “Grow” strategy with a focus on Market Penetration through product innovation. By investing in new and exciting attractions, the company can capitalize on its strengths, attract more visitors, and maintain a competitive edge in the dynamic and highly competitive amusement park industry. Continuous product innovation will be essential in meeting changing consumer preferences and securing long-term success and growth for the company. Strategic implementation of the recommended grand strategy will ensure that Sea World Parks and Entertainment, Incorporated, remains at the forefront of the industry and continues to be a prominent player in the amusement park market (IBISWorld, 2023).

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References

IBISWorld. (2023). Amusement Parks in the U.S. (713110). Retrieved from IBISWorld database.