Visa Inc Swot Analysis And Positioning Analysis

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Visa Inc. SWOT analysis

Visa Inc. is an international payment technology organization that tends to connect

businesses, governments, consumers and financial institutions. It does so in over 200 countries

allowing them to use digital form of currencies instead of checks and cash.

Strengths

 Ownership of the biggest electronic

payment networks in the globe.

 Unique and scalable payment

processing platform in the globe.

 Offers a wide variety of electronic

payment services and products.

Weakness

 Loop system tends to suffer from very

low control over the services meant

for cardholder.

 There is failure of customer

negotiation which affects the

acceptance of Visa cards

Opportunities

 There is a gap in small business

spending which needs to be tapped.

 Momentous acquisitions may help the

firm in extending its service

competences.

Threats

 The Regulatory changes in the

industry may limit its expansion of

profits.

 Rapid advancement in technology also

pose potential threat

Strengths

 The company tends to own the biggest electronic payment networks in the globe. It tends

to operate one biggest retail electronic payment networks based on the number of

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transactions, total volume and payment volume. This includes consumer debit, credit as

well as commercial payments which are mainly offered under visa Electron, PLUS

brands and Interlink. Visa has a substantial competitive edge over is considerable in

terms of total volume, cards issues, total volume and payment volume (Marketline,

2016). Visa tends to account for approximately half all the world’s biggest electronic

payments and three fourths of all the debit card transactions. Therefore, the company

should capitalize on this strength to increase its profits and acquire new customers

(Menon, 1999).

 The company has a unique and scalable payment processing platform in the globe. The

company tends to own as well as operate VisaNet which is regarded as a centralized, sure

as well as international processing platform. The main advantage the company has over

its competitors is that VisaNet was built on a consolidated architecture rather than what is

known as distributed architecture which allows the organization to provide value-added,

real-time information to its clients. This centralized platform of processing offers the firm

the flexibility required to develop, enhance as well as modify its products and services in

an efficient manner.

 The company has a wide variety of electronic payment services and products. The firm’s

product platforms tend to include cash access, debit, prepaid products and credit for

clients, governments and businesses. This allows the organization’s clients in developing

as well as customizing their personal payment programs with the purpose of meeting the

specific needs of their merchants and card holders. The firm also tends to offer its clients

issuer processing with the aim of supporting the organization’s prepaid and debit

platforms.

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Weaknesses

 The company’s loop system tends to suffer from very low control over the services of the

cardholder. Operator companies for open-loop networks under normal circumstances do

not set fees, issue cards or even regulate the interest rates that the various cardholders are

charged when using their cards. Issuers are the individuals with the sole responsibility of

determining such factors as well as other numerous card features. As a result, the success

of the company’s open loop system is highly reliant on the capabilities of the financial

institutions in providing attractive packages to card holders.

 There is failure of customer negotiation which affects the acceptance of Visa cards. For

instance, in Canada acceptance of Visa cards has been strained by lack of customer

negotiation. As a result, Walmart one of the largest retailers announced that it would no

longer accept Visa cards in its Canada Stores. Therefore, the company should come up

with strategies to improve Visa Card acceptance.

Opportunities

 There is a gap in small business spending which needs to be tapped. According to reports,

many of the small businesses tend to use only cheques and cash. As a result, the firm

should exploit this chance.

 Secondly, momentous acquisitions may help the firm in extending its service

competences. This will help the company access more resources required to increase its

revenue and growth (Hill & Westbrook, 1997).

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Threats

 The Regulatory changes in the industry may limit its expansion of profits. Over the past

few years, the reimbursement fees such as interchange rates have come under a sharp

scrutiny across the globe. These regulations are negatively impacting the firm’s debit

businesses particularly in the United States as well as the associated revenues through

creation of negative pressure exerted on pricing.

 Rapid advancement in technology also pose potential threat in a case where the company

does not come up with any innovation

Positioning Analysis

The payment industry is in the middle of making some of the biggest changes. These

changes will result in a better experience for consumers and faster growth for the company. In

terms of performance, 2015 was perceived as a great year for Visa Inc. because it reported some

adjusted earnings per share growth of a total of 16% and growth in revenue at a rate of 9%.

According to the reports delivered, this has been the trend for the past few years. This shows that

the company has been performing well and in a consistent manner.

In terms of growth, the company tends to evaluate its strategies to achieve long term

goals. The company believes that strategies should be formulated and structured towards the

accomplishment of long-term value. The company is adopting innovations to move with the first

changing industry. According to the company’s reports, people tend to view the Visa card as

being an innovation. The company has been able to use the card to conduct as well as grow

commerce in an easy and safe manner in partnership with its customers (Marketline, 2016). As a

result, customers tend to have access to huge amounts of money that are beyond their carrying

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capacity. This provides convenience to the users. Visa Inc. has a competitive edge over its

competitors. This is because, it is regarded as the largest retail network that engages in electronic

payments. During the 2015 fiscal year, it recorded a total of $13,880 registering an increase of

9.3%. From this, it is evident that Visa. Inc. is widely accepted because it offers its client an

easy, convenient and fast access to electronic funds.

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Works Cited

Menon, Anil, et al. "Antecedents and consequences of marketing strategy making: a model and a

test." The Journal of Marketing (1999): 18-40.

Hill, Terry, and Roy Westbrook. "SWOT analysis: it's time for a product recall." Long range

planning 30.1 (1997): 46-52.

Markeline. Company Profile: Visa Inc. www.marketline.com

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