Zoom has become the most popular application ever since the lockdown and the trend of work-from-home and homeschooling. It has attracted the attention of many people across the world. Eric Yuan established the company in 2011, and he was the former vice-president of Cisco Webex.
Initially, the company started operating under the name of SaaSBee, and the founder changed it to Zoom later. The company launched the mobile application version in 2012. The video service providing platform has been on the path of growth since then, and the wave of pandemics amplified its market reach to a great extent.
According to an estimate, the annual revenue of Zoom in 2020 was $2.6 billion, and it has a net profit of $671 million. The market value of Zoom in 2019 was 37.6 billion dollars, and it reached 160 billion dollars in 2020. However, the current market value of the brand is around 121 billion dollars.
Zoom Annual Revenue
| Year | Revenue |
|---|---|
| 2018 | $331 million |
| 2019 | $623 million |
| 2020 | $2.6 billion |
The main products and services of Zoom are Collaboration & Meeting Tool, Business Telephone System, Online Chat, and Videotelephony. The brand’s main competitors are Slack, Meet Now, Skye, Messenger Room, Microsoft Teams, Mee, Google Hangouts, GoToMeeting, and Cisco Webex.
Today, we’ll discuss the swot analysis of Zoom video communication. It’s going to focus on the internal strengths and weaknesses of the video service providing platform, and external opportunities and potential threats that the platform has to face.
Here’s the swot analysis of Zoom Video communication as follows;
Table of Contents
Strengths of Zoom Video Communications
Some of the main internal strengths of Zoom are as follows;
Easy to Use
The user interface of Zoom is simple and easy, and it allows you to connect with a group of people conveniently. The registration and login process over the mobile application isn’t lengthy and doesn’t require you a lot of detail. You just have to enter a few account details, and you’re good to go. If you receive an invitation link to join a meeting, then you can easily participate in the meeting without having an account. Therefore, it has attracted the attention of many people worldwide.
Zoom Daily Meeting Participants
| Date | Meeting Participants |
|---|---|
| December 31, 2019 | 10 million |
| March 31, 2020 | 200 million |
| April 21, 2020 | 300 million |
Niche Focused
Conference calling and video meetings are such features that aren’t unique, other platforms like Skype and Hangout are offering the same features additionally along with their other core features. The management of Zoom recognized their limitation and focused on improving its video meeting features. In fact, Zoom precisely focused on one niche of audio/video meeting calls and specifically targeted on market.
Unique Features
As I just said Zoom didn’t invent the new technology, it precisely focused on one weak area and started improving it according to the requirements of the target customer market. While doing so, Zoom launched some new features like meeting and collaboration tools that customers were looking for. The usability of the platform has increased significantly with the introduction of unique features like a shared whiteboard or customized screen adjustment.
Brand Name
Many video meeting applications came into existence during the pandemic and lockdown, but their market presence didn’t impact the popularity of Zoom. The video conference platform became an established platform by the time they were perfecting features. The users recognized the brand name Zoom as a platform that they can rely on.
Freemium Model
The other reason for the popularity of Zoom is its freemium business model. It means that the customers could use the platform for free, and if they want additional features, then they have to pay for customized services. However, other platforms didn’t allow users to use the platform for free.
Weaknesses of Zoom Video Communications
Some of the internal weaknesses of the platform are as follows;
Encryption Issues
Zoom allows its user to have end-to-end encryption in their communication and meetings. Many tech experts and professionals say that the encryption isn’t as strong as it should be. However, it’s a great opportunity for competitors to work on this weak area of Zoom. Strong encryption and privacy is the main concern of some users, and they would leave the platform as soon as they get a better option.
Less Optimum Features
Zoom has done a tremendous job in launching a niche-focused platform with its unique tools and features. But the company hasn’t optimized some of its features in order to provide a better customer experience, and they require a lot of polishing. For instance, users have to create rooms on a specific topic for Zoom rooms. The platform doesn’t offer a specific tool for moderators to regulate them.
Security Issues
Zoom is using the China-based server and it’s a great security concern for many westerners and Americans. It’s because of the bad reputation of the Chinese government in terms of censorship and tracing the private data of ordinary users. However, the platform doesn’t offer additional security features, and any new platform with better security features could overtake the market share. Some security cautious users are already joining other platforms.
Opportunities for Zoom Video Communications
Some of the main external opportunities available to Zoom are as follows;
High Demand
The usage and popularity of Zoom multiplied during pandemic and lockdown, because of homeschooling and work-from-home trend. It has amplified the growth and demand of Zoom due to its features of collaboration and meetings. It is a great opportunity for Zoom to keep on exploiting its strengths.
Tech Development
Innovative solutions, unique features, and niche-focused are the main reasons for the growth and productivity of Zoom. Innovation is the key to success in the world of technology. Zoom should keep on adding innovative features to its platform to maintain its success. It would also allow the company to amplify its total number of users.
Diversification
Zoom offers limited services like meeting solutions and collaboration. They achieved great success and brought a lot of profitability and growth to the company. The video conferencing platform should further diversify its platforms by adding more products/services in order to lower the risk factor. For instance, Zoom could transform its platform into a social media platform or a chatting application in order to keep the interests of customers.
Growth Rate
Zoom has already got a billion users, but the infrastructure of the brand is very limited in the global market. The platform is establishing research and development facilities in India and China, and it’s great news. The company should keep on expanding its platform in the other developing markets.
Threats to Zoom Video Communications
Some of the main external threats that Zoom has to face are as follows;
Competitors
There are many substitute platforms available in the market, and they’re offering similar products and services. The business model of the video conferencing platform is very easy to replicate. However, some of the main competitors of Zoom belong to the tech giant brands like Google, Microsoft, and Facebook, and their presence in the market makes it further difficult for the company to retain its position.
After Pandemic
Work from home during the pandemic was the main reason for the growth and success of Zoom. What about when the circumstances would go back to normal, and currently the user rate of zoom has fallen to a great extent. In fact, the user rate of Zoom would decline significantly unless the brand offers something unique.
Substitute Apps
Even though Zoom is a niche-focused platform; so does the other competitive application like Discord and Skype. Substitute apps are the main threats to the company. For instance, if the service is down, then the users would go to the other applications without wasting any time.
