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Case
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Reference no. 310-187-1
Authors: Alan Hoffman
Published by: RSM Case Development Centre
Originally published in: 2010
Revision date: 26-Oct-2012
Length: 15 pages
Data source: Published sources

Abstract

iRobot is among the first companies to introduce robotic technology into the consumer market. Home care robots have been its most successful products, with over 5 million units sold worldwide and accounting for over half of its total annual revenue. The focus on home care products differentiates iRobot from all the other manufacturers in the robotics industry, which are mainly focused on manufacturing robots for the automotive sector. At the same time, iRobot also has long-term contractual agreement with US government to produce military robots. Serving two entirely different markets - consumer and military - gives iRobot: (1) the ability to leverage its core capabilities and diversification; and (2) a hedge against slower demand in one sector. By introducing robotics to the consumer market, iRobot has created a 'blue ocean.' However, iRobot has numerous competitors with more experience in the consumer marketplace. Long-term success in the consumer market will require iRobot to develop more 'blue oceans.' Does it make sense for iRobot to continue to develop new consumer products or would they be better off to focus on the military and aerospace marketplace?
Location:
Industry:
Size:
500 employees, USD100 million revenues
Other setting(s):
2010

About

Abstract

iRobot is among the first companies to introduce robotic technology into the consumer market. Home care robots have been its most successful products, with over 5 million units sold worldwide and accounting for over half of its total annual revenue. The focus on home care products differentiates iRobot from all the other manufacturers in the robotics industry, which are mainly focused on manufacturing robots for the automotive sector. At the same time, iRobot also has long-term contractual agreement with US government to produce military robots. Serving two entirely different markets - consumer and military - gives iRobot: (1) the ability to leverage its core capabilities and diversification; and (2) a hedge against slower demand in one sector. By introducing robotics to the consumer market, iRobot has created a 'blue ocean.' However, iRobot has numerous competitors with more experience in the consumer marketplace. Long-term success in the consumer market will require iRobot to develop more 'blue oceans.' Does it make sense for iRobot to continue to develop new consumer products or would they be better off to focus on the military and aerospace marketplace?

Settings

Location:
Industry:
Size:
500 employees, USD100 million revenues
Other setting(s):
2010

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