Detailed SWOT Analysis of Swisscom – A Major Telecommunications Provider In Switzerland

Quick Stats on Swisscom

Founder	Swiss Government
Year Founded	1997
Origin	Switzerland
No. of Employees	19,000+
Company Type	Public
Market Cap	$30.82 Billion (2022)
Annual Revenue	CHF 11.100 Billion (2020)
Net Income/ Profit	CHF 1.528 Billion (2020)

 

Products & Services by Swisscom

Swisscom has been active in the telecommunications industry for a long time and offers the following products and services:

• Fixed telephony
• Broadband
• Digital TV
• Mobile

Competitors of Swisscom

Swisscom Canada is one of the largest communications companies in Switzerland and below are the top 4 competitors of Swisscom:

• Sunrise UPC
• Salt
• Quickline 
• ISPs

Now, we have a clear picture of the company’s core business. Let’s talk about the SWOT Analysis of Swisscom.

SWOT Analysis of Swisscom 

SWOT analysis examines the strengths, weaknesses, opportunities, and threats that a firm faces. SWOT Analysis is a tried-and-true tool that enables a company like Swisscom to compare its business and performance to that of its competitors.

It will give us a strategic analysis of its internal and external environment, which is crucial for understanding the SWOT Analysis of Swisscom.

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

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

Strengths of Swisscom

Swisscom, being one of the leading companies in its industry, has several benefits that help it flourish in the marketplace. These strengths not only help it retain market share in existing areas but also help it break into new ones.

• Wide Spread Distribution Network: Swisscom has created a reliable distribution network over its 24 years of journey that allows it to reach the majority of its potential market through innovation.
• Leading Market Position: Swisscom holds a leading market position because of its inception as the sole provider of telephone service in Switzerland. 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 Swisscom to the top of the Switzerland market.
• Highly Qualified Workforce: Through training and learning initiatives, Swisscom has been able to develop a highly qualified staff. Swisscom 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.
• Good Capital Expenditure Returns: Swisscom has a solid track record of completing new projects and generating good returns on capital expenditure by establishing new revenue sources.
• Customer Satisfaction is Just High: Swisscom has been able to achieve high customer satisfaction among current customers and strong brand equity among potential customers due to its dedicated customer relationship management department.

Weaknesses of Swisscom

Swisscom’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 Swisscom 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: Swisscom 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.  Swisscom’s competitors seemed to have an upper hand when it comes to small budgeted plans.
• Competition with Brands Affecting the Market: Although Swisscom 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 Switzerland Market for Major Revenue: As Swisscom has its main headquarters in Switzerland and it is providing the services more efficiently and gets major revenue from Switzerland. It is mostly dependent on the Switzerland market and hence lacks revenue from worldwide.
• Limited International Presence: Swisscom 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 Swisscom

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

• Internet Users: According to Statista.com, there are over 4.66 billion active internet users in the world. Swisscom 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 Swisscom 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 Swisscom 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 Swisscom.

Threats to Swisscom

External environmental factors that can harm a Swisscom’s growth are known as threats. Swisscom’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 Swisscom.
• 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 Dispute: Swisscom has been caught in disputes with its labour and the union also went on strike against the company in the year 2005. The company should look after its employees, if not then it can affect the operations of the company.

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