In-Depth SWOT Analysis of Orange – A French Multinational Telecommunications Corporation

Quick Stats on Orange

Founder	Hutchison Whampoa
Year Founded	1988
Origin	France
No. of Employees	142,150+
Company Type	Public
Market Cap	$32.23 Billion (2022)
Annual Revenue	€42.238 Billion (2019)
Net Income/ Profit	€3.226 Billion (2019)

 

Products & Services by Orange 

Orange has contributed to the telecommunication industry with various products for more than a century.

• Fixed-line telephone
• Mobile phone
• Broadband
• IPTV
• Internet
• Bank

Competitors of Orange

Orange contests with brands across the globe. The topmost brands are:

• Vodafone 
• Telefonica 
• BT Group 
• Deutsche Telekom 
• Telefónica Colombia 

Now as we are familiarized with the company brand and business let’s shovel into the SWOT analysis of Orange.

SWOT Analysis of Orange 

SWOT Analysis is a useful technique for developing business strategies for both new and current businesses. This simplified methodology is used to assess a company’s competitive standing. SWOT analysis of Orange can help the organization develop effective and efficient business strategies.

To better understand the SWOT analysis of Orange, refer to the infographics below:

Below is an explicit guide to the SWOT analysis of Orange.

Strengths of Orange

The brand’s competence gives an edge over capturing the maximum market in the industry and earning more profits. Hence here we go with the strengths as follows:

• Wide Spread Distribution Network: Orange has created a reliable distribution network over its 25 years of journey and almost 2 decades as France Telecom that allows it to reach the majority of its potential market through innovation.
• Leading Market Position: Orange holds a leading market position because of its inception as the optical telegraphy network of Claude Chappe in France. Since its inception the growth enabled the company to create a new revenue stream and diversify the economic cycle risk in the markets it serves, propelling Orange to the top of the French market.
• Highly Qualified Workforce: Through training and learning initiatives, Orange has been able to develop a highly qualified staff. Orange devotes significant resources to employee training and development, resulting in a team that is not just highly competent but also driven to attain greater success.
• Wide Operations: Orange operates and provides services in mobile, landline, internet, broadcasting, Orange sport, video on demand, online entertainment and music which gives Orange a plethora of resources to generate revenue.
• Good Capital Expenditure Returns: Orange has a solid track record of completing new projects such as joint ventures & holdings with BT Group & Globecast. This leads to Orange generating good returns on capital expenditure by establishing new revenue sources.
• Customer Satisfaction is Just High: Orange has been able to achieve high customer satisfaction among its current customer base of 150 million in France and strong brand equity among potential customers due to its dedicated customer relationship management department.

Weaknesses of Orange

Orange’s weakness is an area where he can improve. Strategy is about making important decisions, and weaknesses are areas where a company could improve with the help of a SWOT analysis.

• Moderate Success Beyond its Core Business: Even though Orange is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• High Prices for Small Plans: Orange struggles when it comes to the pricing of its budgeted devices. Its pricing seems to fall slightly on a higher side in small data plans ranging between 1 – 5 GB.  Orange’s competitors seemed to have an upper hand when it comes to small budgeted plans.
• Competition with Brands Affecting the Market: Although Orange has a unique marketing strategy the new brands and other existing brands are also coming up with new strategies. But to maintain the position of best telecom services they need constant advertising, improvement in their products and this causes the majority of the expenses of the brand.
• Reliance on French Market for Major Revenue: As Orange has its main headquarters in France and it is providing the services more efficiently and gets major revenue from France. It is mostly dependent on the French market and hence lacks revenue from worldwide.
• Limited International Presence: Orange currently operates in only eight markets around the world. It should consider operating in other countries, to expand its business and create strong brand recognition and awareness in the market.
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Opportunities for Orange

Opportunities are possible areas for a company to consider to improve results, sales, and, ultimately, profit. Orange includes the following opportunities:

• Internet Users: According to Statista.com, there are over 4.66 billion active internet users in the world. Orange has a huge opportunity to increase its customer base by providing affordable data plans. 
• New Environmental Policies: The new opportunities will open doors to a level playing field for all the players in the industry. It provides a good opportunity for Orange to drive the advantage home buying new technology and gain market share for new product categories. Also to sustain the potential customers as well as loyal ones.
• Stable Free Cash Flow: The stable cash flow provides opportunities to invest in adjacent products. Hence when more cash is with the company can think of some new technologies and product segments to increase the market share. 
• Technological Advancements: The new technology provides an opportunity for Orange to practice a differentiated pricing strategy in the new market. It enables the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
• Improvement in the Customers: These days we see a very dynamic lifestyle of the people and hence lifestyle and standards mean more consumption of the products and services, and in turn more opportunities to encourage the purchase. This will eventually increase the market share of Orange.

Threats to Orange

External environmental factors that can harm Orange’s growth are known as threats. Orange’s threats include the following:

• Strong Rivalry from other Communication Providers: There is a lot of competition in the industry these days. This affects prices, resulting in a drop in revenue or income for Orange.
• Threat from Local Distributors: Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
• Labour Incidents: Orange has been caught in labour incidents in which its staff of 60  France Télécom employees committed suicide in the year between 2008-2011. The company should look at employees’ “work” and “health risks”, if the company will not then it has to face some strict cases from its employees.

This ends our detailed SWOT analysis of Orange. Let us conclude our learning below.