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Class 1 PPT: Venture Business Overview - Industries, Business ... Class 1 PPT: Venture Business Overview - Industries, Business ... Presentation Transcript

  • New Business Creation I From idea to investment Jay Andrew Smith (jay@eng.kagoshima-u.ac.jp) Associate Professor Inamori Academy, Kagoshima University Spring/Summer 2008 ビジネス創造論Ⅰ
  • Class 1: Introduction to Venture Business, Industry Analysis & Strategy
  • Jay Andrew Smith (44)
    • 1963 New Jersey, USA
    • 1985 Rutgers University (Economics 経済学 , Physics 物理学 )
    • 1989 Harvard Business School (MBA 1989)  日本に始め来ました
    • 1990 Management Consultant (NY, NJ, Tokyo)
    • 1992 Venture Business (IT, Internet, email)
    • 1998 Investment Banker   (SF, LA, SV, NY, LV)
      • Raised $400,000,000 for clients - IPO, Private Investment, M&A
    • 2004 Kagoshima University, Inamori Academy Professor from 2005
    • 日本に初めて来たのは 1989 年 4 月 2008 年?
      • 日経平均株価  39,000単位 円
      • Dow Jones Indus. 2,750点
      • ___ 総理大臣
      • ___ 大統領
      • OS=    
    Bush 12,900円 12 , 300 点 and 宇野 and 海部 竹下 Bush DOS V QUIZ
  • Student Introduction
    • From Kagoshima ? ___% Other ____%
    • Course of Study
      • Electrical Mechanical
      • Chemical Medical
      • Bio Nano
      • Fisheries Other
    • Lived or studied abroad?
    • Speak English Well?
    • First Business Course?
    • Has “Good” Business Idea?
  • Venture Business English   (1) 総合する synthesize 製造者/提供者 supplier 運動量 momentum ディストリビューター distributor 適応 adaptation 顧客 customer 予想 anticipation 革新/変革 innovation 経済学 economics キャッシュフロー cash flow 税 taxes 形式上 pro-forma 代替製品 substitute product 財務分析 financial analysis 競争優位 competitive advantage 戦略 strategy 支持できる sustainable ビジネスモデル business model 競争相手 competitor 投資家 investor 産業 industry 株 stock 管理者 administrator 起業家 entrepreneur 統制 control 会計 accounting 考え idea 財政/財務 finance 資本/資産 capital 市場細分化 market segmentation 適用/応用 application マーケティング marketing 市場 market 販売 sales プロダクト/製品 product 責任 liabilities 販売ルート sales channel 資産 assets
  • Revised Class Schedule
    •     Office Hour:
    • Tues: 13:30-15:00 VBL 2F 電話 285-3630
    4/15( 火 )16:10-17:40 ① Intro to Venture Business & Industry Analysis 4/22( 火 )16:10-17:40 ② Intel Case Study 5/13( 火 )16:10-17:40 ③ Sales & Marketing 5/27( 火 )16:10-17:40 ④ Sales & Marketing Case Study 6/3 ( 火 )16:10-17:40 ⑤ Marketing Project Presentations 6/10( 火 )16:10-17:40 ⑥ Ideas and Innovation 6/17( 火 )16:10-19:20 ⑦⑧Product & Service Presentations / Finance & Accounting 6/24( 火 )16:10-17:40 ⑨ Finance & Accounting (continued) 7/1 ( 火 )16:10-17:40 ⑩ Business Models & Plans 7/8 ( 火 )16:10-19:20 ⑪⑫Elevator Pitches / Investment & Valuation 7/15( 火 )16:10-17:40 ⑬ Presentation Workshop & Review 7/22( 火 )16:10-19:20 ⑭⑮Presentations 2 Classes Final Report: Team Business Plan Paper By July 29 ( 火)  [email_address]
  • Making a Successful Venture Business Idea Entrepreneur Team Customer Markets Strategic Partners, Early Users, Supporters Capital Yen/ $ Business Model & Strategy Sales & Marketing R&D, Production, Operations Suppliers, Distributors
  • All Parts Work Together Business & Technology Environments Opportunity Social & Government Environments Business Strategy Marketing Strategy
    • Operations
    • Strategy
    • Organization
    • Human Resource
    • Production
    • R&D
    • Finance
    • Strategy
    • Leverage
    • Asset Utilization
    • Make/buy
    • Lease/own
    Do strategies support, fit each other, have flexibility, balance/manage risk?
  • Famous Venture Business Successes Bloomberg                                 
  • Silicon Valley Seminar
    • 10 Students
    • September
    • 5-6 days
    • IT, Biotech
    • VC, Lawyers
    • Stanford
    • Berkeley
  • Japan & Silicon Valley, California
  • Japan & Silicon Valley, California Japan 140,000,000日本人 377,835 sq km 磐梯山 N37 。 38’ California 40,000,000外国人 411,015 sq km SF 空港 N37 。 37’ SF SJ LA Silicon Valley 太平洋 Hawaii ・・ SF=San Francisco ( サンフランシスコ ) SJ=San Jose ( サン・ホセ )
  • Silicon Valley
    • 1849 California Gold Rush
      • San Francisco   800 人 =>24,000 人
    • 1970~ Silicon Rush
      • Silicon Chip
      • Fairchild Semiconductor, Intel
    • Mix 4-5 million 人
      • 5 Counties (SF,SM,SC,CC,A)
      • 外国人: 1st/2nd/3rd 世代 America, Europe, India, China, MidEast, Russia, Japan
    • Stanford, UC Berkeley, UCSF,
      • Santa Clara , 他大学
    • Lawrence Livermore Government Research Labs
    Oakland Berkeley Kagoshima Univ. Silicon Valley Office
  • Birthplace of Silicon Valley David Bill Packard & Hewlett 367 Addison Ave, Palo Alto in David Packard’s Garage 1938: R&D begins on 1 st product audio oscillator 1939: Formal partnership Jan 1. Decide name with a coin toss. Sales: $5369. Employees: 2 1938
  • Not So Famous Venture Business Success es (M&A)
    • TriVida
      • “ Third life” together for management team
      • Personalization software
      • Sold to BeFree .com 1999
      • BeFree IPO 1999
    • SpinPop - Electric Lollipop
      • John Osher
      • “ Serial Entrepreneur”
      • Motorized lollipop
      • Low-cost motor usable in mouth
      • High-priced electric toothbrush already
      • Low-priced spin toothbrush
    SpinBrush Company Sold to P&G for $475 million (475 億円 )
  • Most Venture Ideas Don’t Succeed Sales – Costs > 0 Idea Business Start-up Sales / Funding Profitable IPO Bubble
  • Making a Successful Venture Business Idea Entrepreneur Team Customer Markets Strategic Partners, Early Users, Supporters Capital Yen/ $ Business Model & Strategy Sales & Marketing R&D, Production, Operations Suppliers, Distributors Valuable
  • Successful Venture Business Create Value by Solving Prob lems
    • Sony Big radios not portable
    • FedEx This has to get there overnight
    • Google I can’t find good information
    • eBay I have old stuff you will pay for
    • Microsoft Not everyone is a programmer
    • Intel These computers are too big
    • Bloomberg I need best, timely info to invest
    Company Problem/Opportunity/Desire (financial companies can be great early customers)
  • Problems Become Opportunities “ What people need is problems. The power that emerges when faced with a problem, where you would lose everything, is your true power.” Souichiro Honda 人間に必要なのは困ることだ。絶体絶命に追い込まれたときに出る力が本当の力です。 本田宗一郎
  • Today’s Global Issues
    • Pollution
    • Hunger
    • Oil Shortage
    • Population Growth
    • Military Spending
    • Population Aging
    • Religious Fundamentalism
    • China Rising (supplier, consumer, politics, military)
    • Other __________
  • Japan Issues
    • Economic Recession
    • Government Bureaucracy
    • Small land area/population
    • Employment dislocations
    • Oil Shortage
    • Population Aging
    • China Rising (supplier, consumer, politics, military)
    • Humidity
    • Other __________
  • Making a Successful Venture Business Idea Entrepreneur Team Customer Markets Strategic Partners, Early Users, Supporters Capital Yen/ $ Business Model & Strategy Sales & Marketing R&D, Production, Operations Suppliers, Distributors
  • Drucker on Entrepreneurs The entrepreneur always searches for change, responds to it and exploits it as an opportunity. - Peter Drucker 起業家は常に変化を捜し、 それを機会として利用し、対処する。
  • Peter Drucker – Business Guru
    • Pioneer of management thinking
    • Over 30 books on management
    • Drucker Institute
    • The Peter F. Drucker Masatoshi Ito Graduate School of Management (Claremont Univ.)
    • Leader to Leader Institute
    (1909-2005)
  • Apple’s Computers Then & Now iPod 6G 160,000,000KB HD First Apple Computer 8KB RAM in 16 Chips
  • Microsoft Should Not Exist
    • IBM dominated PC market
      • IBM t hought hardware was most important
      • IBM now has no PC hardware at all
    • Microsoft didn’t create its own first software
    Bill Gates (~1985) 仮定とは危険なものである。 アガサ・クリスティ
  • “ The Stone Age didn’t end because they ran out of stones.” Stone Age Bronze Age Mechanical Age
    • Solar
    • Power
    • wind/water
    • plants/ fire
    • Animal
    • Power
    • 動物
    • 人間
    Coal/Oil Power Nuclear Power Plastics Age Bio Gene Age Age Nano Age? --------------Analog Age--------------------------------------- Digital Age
    • Renewable
    • Sun
    • Wind/tide
    • Plants
    1800 1900 2000 年 -4000 年 -2000 0 Wired -> Wireless Electrical Age Electronic Quantum Age Age? control organic material energy/info transfer energy network 石器時代はそれらが石を使い果たしたので終わらなかった The speed of change is accelerating.
  • Entrepreneurs are Innovators Kazuo Kashio ( theme: apply electronics, digital)
  • Entrepreneurs Create New Models
    • “ You never change things by fighting the existing reality. To change something, build a new model that makes existing models obsolete.”
    • 既存の現実の問題によって決して事を変えてはいけない。 問題を変えるために、既存のモデルを時代遅れにする新モデルを造りなさい。
  • Company Success Factors Company Success = f (company, industry)
  • Industry Analysis
    • In which industry does the company participate?
    • How big is the industry?
    • How much is the industry growing?
    • How is the industry changing?
      • New laws (e.g., pollution)
      • New technology
    • Industry profitability?
    • Structurally attractive industry?
  • What industries?
    • Toyota
    • Suntory
    • Disney
    • ANA
    • Sony
    • Yahoo
    • Auto, Motor Vehicle, Transportation Equipment
    • Beer, Liquor, Soft Drink, Beverage
    • Movie, Theme Park, TV, Entertainment
    • Airline, Hotel, Travel, Leisure
    • Consumer Electronics, Music, Movie, Entertainment
    • Internet Provider, Ecommerce, News, Media, Advertising
    Product/Service Areas Application or Broader Category
  • How Big is The Industry? www.stat.go.jp
    • 日本 (2004):       〔円)
    • Government 82,110,900,000,000
    • Defense (陸軍) 4,876,400,000,000
    • - Personnel 2,165,400,000,000
    • Equipment 880,600,000,000
    • National Defense Agency,
    • Ministry of Finance
    一年間   47,993,000,000,000 円 48 兆円 輸送 ( 自動車 , 船 … )
  • Consumer Electronics (2003) (Japan Production, 2003 METI)
  • Consumer Electronics (2003) (Japan Production, 2003 METI) DVD vs Video
  • Japan PC Market 2003 Total = 10 million units
  • Industry Life-Cycle Emerging Growing Maturing Declining SALES TIME
  • Industry Life-Cycle Stages E G M D Analog Camera Auto Digital Camera IP 電話  Example Some exiting Increasing Positions Building New Positions Competition Decreasing Smart, Price Focus Patterns Building 1 st Timers Customers Little Investment Incremental Changes Process Changes Rapid Changes Product/ Technology Decreasing Slowing Increasing Starting (2 mil ->22 mil) 2002 2007 Growth Rate Declining Maturing Growing Emerging
  • Venture Companies Often Start in or Create Emerging Industries
    • New products/services
    • Unproven market
    • Little market info
    • First-time buyers
    • Know-how developing
    • Technology changing
    • “ Rules” not set
    • Structure unsettled
    • Future uncertain
  • Growth , Market Share & Competition
    • Market share=company’s % of industry sales
    • Growing industry is often less competitive
      • If the industry doesn’t grow companies must take customers from other companies to grow.
    2004 2005 Co. A Co. B Co. A Co. B 2006 Co. A Co. B Sales Co. B Co. B 50% 50% 50% 50% 70% 30%
  • Industry Structure COMPANY Suppliers 製造者 Competitors 競争相手 Substitutes 代替製品 Channel 販売ルート Customers 顧客 4 Cs Venture Businesses Often enter h ere Collaborators 協力者/協業者 “ 5 th C”
  • Example:  ヤマト急便 ヤマト急便 Suppliers Competitors Substitutes Channel Customers
  • Example:  ヤマト急便 ヤマト急便 Vehicles, Fuel, IT UPS 佐川、 UPS, 郵政省 Fax, Car 7-11, Family Mart, 0120 Homes, Offices Others???
  • Company
    • Who are we? Why are we here?
    • What are our goals?
    • What are our strengths?
    • What are our weaknesses?
    • What are our key competitive advantages?
    • What is our market position?
    • What is our strategy?
    • What is our business model?
  • Suppliers
    • How many?
    • How big?
    • Relative Strength
    • Importance/Value (e.g., keitai strap vs. LCD screen)
    • Derived Demand
    Intel Processor, MS Windows, Sharp LCD PC User Kyocera IC Chip Package
  • Channel
    • How your product service gets to customer
    • Direct – company’s own network
      • Sales Force, Mail, Telemarketing, Vending, Some Internet/Catalog, Company Store
    • Indirect – via one or more other companies
      • Sales Agents, VAR (value added resellers), Stores (department, convenience, supermarkets, Some Internet/Catalog (e.g. Askul)
  • Collaborators
    • Partners, helpers, advisors, experts
    • Directly or indirectly help the company
    • Examples
      • Industry experts, user groups, educators, advisors
      • Industry or trade groups
      • Government, NPOs, universities
      • Complementary product/service providers
        • Software makers for hardware
        • Computer magazines, manuals, websites
  • Competitors
    • Who are they?
    • H ow many?
    • What are their goals & strategies?
    • What are their (relative) strengths?
    • What are their (relative) weaknesses?
    • More competitors leads to lower prices
      • (except maybe in Japan)
  • Substitutes
    • How else can customer achieve goal?
    • What are the advantages/disadvantages?
      • Time, Cost
      • Quality, Effectiveness
    • What does it cost customer to switch?
    • Are there new technologies coming?
    Foot Horse Train Car Plane
  • In Class Exercise ___ Company Suppliers Competitors Substitutes Channel Customers
  • 5 Industry Forces Affect Profitability Company Supplier Power New Competitor Entry Substitutes Buyer Power Channel / Customer Current Competitor Rivalry Profit = Price – Costs cost price price price
  • 5 Industry Forces (Michael Porter, HBS)
    • Buyer Power (Customer /Channel)
      • How many, how big, how valuable, how sensitive
    • Supplier Power
      • How many, how big, how important to us, us to them
    • Current Competitor Rivalry
      • How many, cost structure, capacity, positioning, exit costs
    • New Competitor Entry
      • Ease of entry, cost of switching, technology change
    • Substitute Products/Services
      • Advantages/disadvantages, cost of switching
  • Keiretsu Effect on Structure Mitsubishi Group Company Suppliers Competitors Substitutes Channel Customers + Kyocera Example 日本電気、 三菱 電気 、 etc. X Intel, Fairchild OK, also 松下 Group company, suppliers & sometimes channel work together, keeping out competitors,
  • Homework (next class 4 月 22 日)
    • Intel Case Study
      • Just read it…we will discuss in class … think about the company, industry structure, and the decisions made.
      • Japanese and/or English versions
  • Suggested Readings
    • www.venturesmith.us
    • www
      • siliconvalley.com startupjournal.com
      • inc.com wired.com
      • bfi.org economist.com
      • youtube.com skype.com
      • answers.com worldlingo.com
      • nikkei.co.jp dreamgate.gr.jp
    • Books
      • 肩をすくめるアトラス by アイン・ランド
      • 宇宙船地球号操縦マニュアルちくま学芸文庫 by バックミンスター フラー
      • 会議が変わる 6 つの帽子 by エドワード・デ ボーノ
      • ヴァージン―僕は世界を変えていく by リチャード ブランソン
      • 日本を創った 12 人 by 堺屋 太一
  • Class 2 Industry, Strategy, Business Model (continued) Intel Case Study
  • Announcements
  • 4 C’s & 2 S’s Review ___ Company Suppliers Competitors Substitutes Channel Customers Collaborators 協力者/協業者 “ 5 th C”
  • 4 Cs + 2s – The Players
    • Company (us)
      • Mission, Goals, People, Structure, Strategy, Model
    • Customer (goal)
      • Who? How many, How strong, How important, Wants & Needs
    • Channel (path)
      • Sales Team, Distributors, Service, Support, Partners
    • Competition (them)
      • Who, Current, Future, Advantages, Position
    • Substitutes (other choices for customer)
      • What, Advantages, Costs, New Technologies
    • Suppliers (inputs)
      • Who, How many, How strong, How important to us,
  • 5 Forces Affect Industry Profitability Company Supplier Power New Competitor Entry Substitutes Buyer Power Channel / Customer Current Competitor Rivalry Profit = Price – Cost cost price price price
  • 5 Forces
    • Buyer Power (Customer /Channel)
      • How many, how big, how valuable, how sensitive
    • Supplier Power
      • How many, how big, how important to us, to them
    • Current Competitor Rivalry
      • How many, cost structure, capacity, positioning, exit costs
    • New Competitor Entry
      • Ease of entry, cost of switching,
    • Substitute Products/Services
      • Advantages/disadvantages, cost of switching
  • Today’s Drucker
    • A business has 2 basic functions:
    • marketing
    • and
    • innovation.
    Peter Drucker
  • Intel Case Study
    • Big idea, new technology/business area:
      • semiconductors, IC chips
    • Company is more than its products
      • “ Platform” (product series, same technology base)
    • Technology Innovation
    • Marketing Innovation
    • Strategic Choices
    • Sustainable Competitive Advantage
  • Intel 1968-1977 Case
    • “ Trying to do things nobody else could”
      • – Robert Noyce (co-inventor integrated circuit IC)
    • Gordon Moore (creator of “Moore’s Law)
    • Andy Grove joined, took personal “risk”
    • First 2 DRAM products not successes
    • 3 rd product 1103 became world leader,
      • 90% of Intel revenues (concentrated)
  • Intel Intel Suppliers Competitors Substitutes Channel Customers Kyocera, etc Motorola AMD, TI, Cyrix RISC 日本の DRAM E N D U S E R
    • Licensees
    • IBM
    • Others
    Direct IBM Compaq Dell Packard Bell C H A N N E L
    • Software
    • Providers
    • OS
    • Application
    Equipment (sole/dual) collaborators
  • Intel DRAM Strategy
    • Strategy: push product design, be first to market
      • Design & process technology leader
      • Investment in plant & equipment
      • Costs drop over production volume (scale) growth
      • Prices drop with competitive capacity
      • DRAM generally not protectable with patents
      • Japanese started introducing products more rapidly
        • Invested more heavily in production (44% vs. 22%)
      • 1986 Intel decided to exit DRAM business
        • 1/3 of R&D, but only 5% of Revs, was small player in market
        • Japanese beat Intel on process technology (of commodity)
  • Intel and Microprocessor
    • 1970 CPU chipset order for Busicom calculator
      • Technology development “paid by customer”
      • Bought rights for “non-calculator” use
        • Hard to see future even for Gordon Moore
          • “… never gave it another thought” – Moore
          • “ We didn’t take it (PCs) seriously” – Grove
        • Non-sequential forecasting
        • Sometimes easier for outsider to see
      • Exit: By 1984 mid-level managers shifting technology
        • Hard to leave business that began company
        • Especially for long time senior managers
        • Mid-level managers closer to daily business realities
  • Apple/Motorola vs. IBM/Intel
    • First to Market
    • Closed architecture
    • Sole-provider
      • Exclusivity
      • Proprietary
    • Big, famous name
    • Standardized, open architecture
      • Components
      • Software
      • Scale economies
    • Intel gets benefit of IBM marketing and strategy (derived demand)
    INTERDEPENDENCE OF COMPANIES (p.30, 22) “ Value Chain” 1994 Apple/IBM-Motorola PowerPC chip 2006 Apple/Intel
  • Intel Microprocessor Progression 1989 1985 1982 1978 Year Introduced ? ? $950 80486 (64-bit) 1,200,000 100%-IBM 1 (IBM) $299 80386 (32-bit) 275,000 75% 4 $360 80286 (16-bit) 134,000 30% 12 $360 8086 (8-bit) 29,000 Intel-Chip Market Share Licensees Initial Price Chip (bits) Transistors
  • 386 Changes Everything (1985)
    • Intel 386 Investments
      • $200 million for design
      • $800 million for production facilities
      • Decides not to license, except IBM
    • IBM choice allows Compaq entry and Win
      • IBM delays selling, to create more closed architecture
      • Compaq enters Desktop market with Intel 386
  • 486 and Wintel Collaboration
    • Hardware advance precedes software advance
      • Microsoft Operating System (new DOS) not ready for 386
      • Need large installed base of hardware for software upgrade
    • Emerging collaboration between MS & Intel
      • WINdows + INTEL = “WINTEL” platform
      • Software + Brain
    • Software investments (past and future)
      • Increasing switching costs
  • “ Intel Inside” – Marketing Innovation
    • Ingredient (材料) /Component (成分) Marketing  
      • Another example?
    • Intel is “superior to other chips”
      • Market maturity, education higher (2 nd , 3 rd PC)
      • Buyer Intel preference moved from 60% to 80%
      • AMD: “it shouldn’t matter which chip” but it DOES
    • IBM, Compaq resisted, but then gave in
      • Couldn’t fight Intel
      • Better to have branded “Intel Inside” “premium” chip
      • 6% rebate for use in partner marketing
    • Fight competitors with technology, marketing, lawyers and money power (all pointed to same goal)
      • 1997 spent $750 million
      • More valuable than patent
  • Ending Question
    • Is the internet
    • good or bad
    • for Intel?
  • Some Important Strategic Ideas
    • Where is the most “value” in a computer?
    • Success attracts competition, company must protect against
      • 2005 Intel has 82% of PC processor market
    • Technology moved so rapidly that patents became obsolete
      • protect by know-how, branding, scale, luck
    • Small stuff that goes inside other stuff
      • Allows focus, expertise, scale, “piggy-backing”
    • Thrived on derived demand driven growth and rapid change
  • Typical Market Positions & Strategies Toyota Nissan Mazda Daihatsu Strategy Goal Position Specialize Find Safe Space Niche -Maintain Base -Grow Quietly Grow Carefully Follower -Target Leader -Target Small Challenge Leader Challenger -Grow Market -Grow Share Most Sales Leader
  • Fragmented Industries (fragment= 破片)
    • Market divided over many companies
    • No dominant leader
    • Largest competitor may only have a few percent market share
    • Examples:
      • Restaurants
      • Book stores
      • Repair shops
      • Publishing
      • Pet shops
      • Hair Salons
      • Hotels
    ラーメン
  • Fragmented Industry Strategies
    • Construct formula facility
    • Expand geographically
    • Increase vertical integration
    • Become low-cost producer
    • Specialize by product/service
    • Specialize by customer type
    • Build brand
  • Company
    • Who are we? Why are we here?
    • What are our goals?
    • What are our strengths?
    • What are our weaknesses?
    • What are our key competitive advantages?
    • What is our market position?
    • What is our strategy?
    • What is our business model?
  • Homework Assignment
    • Design your own personal “life” meishi
    わし の めいし
    • Your Name (as you want it)
      • - Nickname (optional)
    • Title (life position)
    • Purpose statement
    • Ideal living place(s)
    • Identifying email address
    • Anything else important
      • Logo
      • Website
      • Business Name
      • Cool Phone Number
    OO 枚 copies please Email: meishi@bizsmith.com (any languages that fit)
  • Homework Assignment
    • Design your own personal“life meishi”
    Jay Andrew Smith International Educator Promoting Growth And Understanding Around the World New York + San Francisco + Kagoshima + Brugge [email_address] SAMPLE www.vistaprint.jp, ppt, Paint, illustrator, etc. by hand all OK color name “ title” Purpose/goal Cool place(s) Meaningful email/HP address logo
  • Sample Meishi Kenta Maruyama Go to Space and Look the Earth Kagoshima+Fukuoka+Space? Someday Astronaut [email_address]
  • Class 3 Sales & Marketing
  • Today’s Drucker
    • The purpose
    • of a business
    • is to create and
    • keep a customer.
  • Marketing Universe
    • Product/Service (what)
    • Market (where, who)
      • Location (U.S.,Japan, 鹿児島市 )
      • Gender (male, female)
      • Age (<21, 21-35, >70, 子供 … )
      • Activity (ski, golf, travel)
      • Preference ( 和風、洋風、辛口)
    • Application (how, why)
      • New application for a keitai
      • New application for a tree
    Products Applications Markets
  • Filling Unmet Needs & Wants
    • Market Focused - Venture Co.
      • – this thing is happening, what can I do about it?
      • Identifying problems and opportunities
      • Reduces market risk (someone needs solution)
      • Demand side
    • Product Focused - Existing Co.
      • – I have this thing …how can I make it better for my customers
      • Supply side
  • Sales & Marketing
    • Sales (Revenue):
      • Money received for selling product or service
      • Source of funds for business operations
      • Basis for business existence
    • Marketing: how company gets sales
      • selection, pricing, promotion and distribution of products/services to customers
    COMPANY Customers Product/Service Money
  • Marketing and 4 C’s & 2 S’s ___ Company Suppliers Competitors Substitutes Channel Customers Collaborators 協力者/協業者 “ 5 th C”
  • Customers
    • Who are your customers (or target customers)?
    • How many potential customers are there?
    • What are their characteristics?
      • Age, sex, wealth, education, hobbies, work, is it one person?
      • What are their goals, desires, needs, wants?
    • How do they buy?
      • What do they think about?
      • Where do they get information? Who influences them?
      • What is important to decide (price, features)
      • When do they buy (seasonal products, bonus season)
      • When do they pay?
    • Market s egment = group of similar customers
      • Broad market = U.S. Market, Software Market
      • Narrow market segment = left-handed golfers
  • Example Consumer Market Segmentation & Positioning Older Drivers Older Families Younger Families Single Men Single Women Car American Safe Zoom Classy Automobiles Toyota Ford Volvo Mazda Jaguar O O O O O O O O O O O O O O O O O O Wealthy, Single, Women Wealthy, Single, Men Takako Tanaka Jaguar In Pink
  • Women, buy ALL the stuff Women buy or influence the purchase of nearly all consumer products and an increasingly high percentage of business related products 1 1 Tom Peters, author of In Search of Excellence
  • Business Market Segmentation All U.S. Businesses 1-person companies Small Businesses >1 person Medium Businesses Fortune 500 Microsoft Large Businesses 10 million total 1 500 9 million How Many ~ 10-20,000
  • Consumer & Business Markets Consumer Market Business/Industrial Market Product Service Haagen-Dazs Amazon Uniqlo Starbucks eBay Sony GE Dell Intel Askul HP Bloomberg Microsoft ヤマト Nike Google? Secom Hair Salon
  • 3 rd Party Business Model COMPANY Customers Product/Service Money COMPANY User Product/Service Money Sponsor Other Service
  • Sales/Buying Cycle
    • Awareness => Interest => Trial => Purchase => Repurchase
    • Hear About Curious Try Buy Use Again
    • This Exists Educate Test Use it Keep Buying
    Repeat customers are key to business success
  • Industry/Market Life-Cycle Emerging Growing Maturing Declining SALES TIME Awareness  Interest  Trial  Purchase  Repurchase
  • Technology Adoption Life Cycle Innovators Early Adopters Early Majority Late Majority Laggards Chasm Geoffrey Moore, Crossing the Chasm Time Examples- Internet Academics Tech. Fans Financial Services Main Market
  • 4Ps – “Marketing Mix”
    • Product (what do we make)
    • Place (where do we sell it)
    • Price (how much we sell it for)
    • Promotion (how do we communicate about it)
  • Product
    • What is our product and/or service
      • Physical/tangible – alarm, software, newspaper, coffee
      • Intangible – security, insurance, information, experience
    • Why do people buy it
      • What does it do?
      • How is it used ?
        • D oes it need something else?
        • One-time or consumable?
    • Packaging (box, label, information, customer experience)
    • Positioning
      • How different is it (perceived) from other products?
      • What is my brand image/strength
  • Favorite Products
    • Product
    • Company
    • Target Customer
    • Packaging
    • Channel
    • Competitive Products
    • Substitutes
    • Value
    • Price
    • Cost
  • Place – Where do I sell?
    • Choosing the Channel, Supporting It
    • How many potential customers are there?
    • Can I easily identify customer?
    • How expensive is my product?
    • How many products can I sell one customer?
    • How powerful, or valuable are the resellers?
    • Are there many resellers that compete?
  • Favorite Products
    • Product
    • Company
    • Target Customer
    • Packaging
    • Channel
    • Competitive Products
    • Substitutes
    • Value
    • Price
    • Cost
  • Price Issues
    • What does it cost to produce? (floor)
      • Cars, Soda, Computer s
      • Pharmaceutic als , Software
    • How much value does it have to customer? (ceiling)
    • How many can I sell at each price ?
      • How many customers are there?
      • How much competition is there?
      • Is it easy to compare with other prices?
      • How much better is my product?
    • Does price fit with my positioning?
  • Price & Margin Cost Price to Channel Price to customer Margin
  • Product Positioning Promotion
  • Promotion (communications, “selling”)
    • Advertising
      • Push (direct mail, email)
        • Is each customer readily identifiable?
      • Pull (TV, radio, poster, newspaper, some banner ad)
        • Can’t readily identify individual customers
      • Internet can be push or pull
      • Chirashi?
    • Public Relations
    • Investor Relations
    • Intel Case Examples
      • Motorola: 13 Wall Street Journal Ads
      • Intel: 6% rebate = 4% up to 66% of Print, 2% up to 50% of TV/radio
  • Promotion & Market Segmentation Men Overweight Men Overweight Athletic Men Overweight, Athletic, Beer-Drinking Men Overweight, Athletic, Beer-Drinking Men, Who care about their figure Taro Tanaka Night TV Direct Mail Football Broadcast Fitness Magazine Train Poster Promotion Media People TV Targeted Poster
  • Advertisement Discussion
    • Product/Service
    • Target Market
    • Medium
    • Value Proposition
    • “ Message”
    • Buying Cycle
  • Next Class 6月 1 日
    • Dell Online Case Study
    • Region Goods/Service Marketing Project
      • www.venturesmith.us
  • Dell Case Issues to Think About
    • Company History and Choices
    • Industry & Competition
    • Products
    • Customer/Market Segments
    • Pricing
    • Channel/Operations
    • Competitive Advantage
    • Case questions & decisions
  • Region Marketing Project
    • Group project 2-3 people
    • Pick product/service from Kagoshima or home region
    • Pick a target market
    • Develop company sales/marketing promotion
    • 6月 1 日 presentation (powerpoint, poster, or other)
      • Presentation: 5 分
      • Q&A and advice: 2-5 分
      • English Preferred
  • Region Goods/Service Promotion Project
    • Product/service:
    • Company/brand:
    • Customer target & size:
    • Promotion message:
    • Place:
    • Channel:
    • Competition:
    • Price:
    • Collaborators:
    + ADVERTISEMENT Sample
  • Promotion Project
    • Product/service:
    • Company/brand:
    • Customer target/size:
    • Business Model:
    • Promotion message:
    • Place:
    • Channel:
    • Competition:
    • Price:
    • Collaborators:
    • Kagoshima fresh tonkatsu
    • Big Pig Ka-ton
    • Japanese tourist hotels (200?)
    • Buy, resell tonkatsu to Customer
    • Japan’s juiciest tonkatsu
    • Trade fair, magazine, site visits
    • Direct
    • Kumamoto Ton, Nissin
    • Slight premium
    • Kagoshima pig farmers 会
  • BIG PIG KA-TON So Fresh You Think It Can Fly TM
  • Fit – Is this the Right Match?
    • Opportunity
    • Environment (4Cs)
    • Marketing Mix (4Ps)
    • Selling/Buying Cycle (Goal)
    • Promotion Message & Strategy
    • Business Model
  • Suggested Readings
    • Books
      • 競争の戦略 by マイケル・ E. ポーター
      • 日本の競争戦略 by マイケル・ E. ポーター , 竹内 弘高
      • キャズム by ジェフリー・ムーア
      • フォーカス―市場支配の絶対条件 アル by リース
      • パーミションマーケティング―ブランドからパーミションへ by セス ゴーディン
      • ネットビジネス戦略入門 by パトリシア シーボルト
    • Video
      • ペイ・フォワード  with ケビン・スペイシー
      • ビッグ・チャンス with ケビン・スペイシー
      • Glengarry Glen Ross with ケビン・スペイシー
    • WWW
      • Entrepreneur.com
  • Class 5: Dell Online Case Study
  • Table of Contents – Outlines Story
    • [Executive Summary] (should be listed)
    • Business Opportunity
      • 1.1 Internet is Huge and Spans the Globe
      • 1.2 Exponential Growth Will Continue for Foreseeable Future
      • 1.3 International Commercial Use is Fastest Growing Segment
      • 1.4 Unmet Needs of Target Market
      • 1.5 Pacific Internet Nodes are Key Players
      • 1.6 Technology is Proven
    • Business Strategy
      • 2.1 Goals & Objectives (generic title vs. become dominant provider)
      • 2.2 Buy Existing Nodes
      • 2.3 Deliver Value-Added Products & Services
      • 2.4 Focus on Sales & Marketing
      • 2.5 Consolidate Operations
      • 2.6 Position Against Major Competitors
    • Organizational Plan (all generic titles)
      • 3.1 Plan of Organization
      • 3.2 Founders and Management Team
      • 3.3 Implementation of Organizational Plan
      • 3.4 Company Values
    • Financial Outlook
      • 4.1 Financial Summary
      • 4.2 Revenue Forecast
      • 4.3 Income Statement
      • 4.4 Cost Structure
      • 4.5 Source and Use of Funds
      • 4.6 Balance Sheet
      • 4.7 Capitalization and Dilution
    • Risk Management
  • Suggested Reading
    • Books & Magazines
    • Movies
      • Wall Street
      • Start-up.com
    • WWW
      • sec.gov (EDGAR, 10K filings, S-1)
      • licensing.org Licensing industry association
  • Course Overview
    • Introduction to Venture Business   
    • Venture Business Concepts Related to
      • Industry Analysis, Business Models & Strategy
      • Sales & Marketing
      • Finance, Accounting, Control
      • Strategy, Planning, Management
      • Operations
      • Product Development/R&D
      • HR (Human Resources)
      • PR IR (Public Relations, Investor Relations)
      • Business Communication
    • Case Studies
    • Projects & Presentations
      • Marketing promotion presentation (group)
      • New product or service idea (group)
      • New business idea “pitch” (individual)
      • New business plan and presentation (group)
  • Today’s First Drucker:
    • Profit is not the explanation, cause, or rationale of business behavior and business decisions, but rather the test of their validity.
    • -- Peter Drucker
    • 利益は、企業行動とビジネス決定の説明、原因または、理論的根拠ではなく、むしろ、それらの妥当性のテストである。
  • Entrepreneur’s Approach
    • Anticipation (予想)– look ahead
    • Timing – move quickly, be ready, catch window
    • Adaptation  (適応)– reacts, adjusts quickly to change
    • Synthesis (総合する)– puts the pieces together
    • Momentum (運動量)– keep moving forward
    • Trust – expect high team loyalty
    • Faith & Confidence – future path is unpredictable
    • Luck – who knows what can happen today?
  • Entrepreneurs vs. Administrators
    • What/where is the opportunity?
    • How do I do something about it?
    • What do I need?
    • How can I get needed things?
    • What opportunity fits us?
    • How do we fit in the market?
    • What things do I control?
    • How can I reduce risk?