Markstrat presentation

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Presentation of team Y - winner in markstract

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  • @yinncai Hi, sorry for replying to late, loans can be asked from adminitrastor of the game
    But by the time I reply, perharps you finish this game. hope you win :D
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  • Right now my team and I are playing the Markstrat Game. We don't understand when the loan comes through? How did you have enough money to spend on a Vodite so early on in the game?
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Markstrat presentation

  1. 1. BUSINESSGAME-Using Markstrat Program- 1
  2. 2. Performance AnalysisGame StrategyDecision-making ProcessLessons Earned 2
  3. 3. 1 PERFORMANCE ANALYSIS 3
  4. 4. Stock ~20000 in P9 We always lead the market throughout 9 periodsRight strategy at thebeginning helped usmove forward 2 special periods, we will discuss in next part 4
  5. 5. Market Share Leading both markets, in a total of 54.8% market share 5
  6. 6. 2 Game Strategy . . 6
  7. 7. General Strategyo Focus differentiation:  Each brand focuses 100% on one segment  Eliminate the Buffs, just focus on Singles, Hiearners, Pros, Others and Vodie market  Conduct R&D at the right time to improve the productso Have to be the first mover to Vodie marketo Ready to changeo Spend all the money in beginning to advertising  get brand awareness The more specific Objective and Strategy will be discussed in next part – Decision Making – 7
  8. 8. 3 Decision-making process 8
  9. 9. Period 1 1. Analysiso Cash is very importanto Use all of the budget to gain competitive advantageso SYGU & SYCA already met the needs of Singles & High earners – Focus on them One Brand focuses 100% on one Segmento Prepare to the R&D project in P2 in order to be the first team enters the Vodite market 9
  10. 10. Period 1 2. Decision Makingo No R&D in P1o Marketing mix – Production: based on market forecast, purchase intention & market share – Pricing: Based on conjoint analysis – Advertising: One brand for one segment – Advertising research: 10% of ads 10
  11. 11. 11
  12. 12. o Market research: Purchased all studies.o Sales forces: Based on shopping habits study 12
  13. 13. Period 13. Results 13
  14. 14. 14
  15. 15. Over1400 15
  16. 16. Period 21. Analysis No team dominated Pros and Others 16
  17. 17. 1 : 6 : 1 : 1 : 1 17
  18. 18. o Have enough cash to R&D voditeo R&D for Vodite costly reduce budget for R&D for Soniteo Decide to go to Pros & Others in futureo Gain more market shareo Gain more casho Increase stock 18
  19. 19. Period 2 2. Decision Makingo R&D projects  PSYG1 to improve SYGU and reduce cost  PSYOT to introduce new product for others  PVY11: new Vodite productso Continously increase  Production  Ads budget & ads research  Sales forceso Perceptual objective: Power and Price (numbers based on Semantic Analysis)o Price: based on Semantic Analysis 19
  20. 20. Period 2 decisions 20
  21. 21. Period 2 3. Resultso More market share!o PVY11 completed!o R&D projects for Sonite hadn’t been completed (not enough needed budget)o Stock increased!o More cash than others 21
  22. 22. ~2300 22
  23. 23. Competitive advantage 23
  24. 24. Period 31. Analysis 24
  25. 25. oStrategy – Release product for Pros to restrain budget of other teams – Use money to boost sales and market shares. 25
  26. 26. Period 3 2. Decision Makingo R&D – PSYG1: for singles, improve and reduce cost – PSYTO: new products for others – PSYPO: new product for Pros 26
  27. 27. Period 3 2. Decision Makingo Brand Portfolio – SYGU: Singles – SYCA: High-earner – SYPO: new products for Pros ( based on same project with SYCA ) – VYTO: first mover in Vodite market 27
  28. 28. Period 3 2. Decision Makingo Realize that we don’t need all the research studies  Buy just what we needo Continuously increase – Production – Advertising and advertising research – Sales forces 28
  29. 29. 29
  30. 30. Period 3 3. Resultso Gain more market share: SYGU,SYCAo Dominate Vodie market: VYTOo Cannibalization: SYPO and SYCA (based on the same project)o But SYPO gain brand awarenesso Completed all R&D projectso Stock increased! 3825 30
  31. 31. Period 41. AnalysisTeam E dominated Pros 31
  32. 32. R&D for Vodite 32
  33. 33. o War against team E in segment Pros to keep them busyo VYTO targeted to Early Adapters and Followers (high potential growth)o Need money to maintain growth  take loano More market shareo Keep competitors busy in Pros and Otherso Dominate Singles, Hieaners, Vodite 33
  34. 34. Period 4 2. Decision Makingo R&D – PSYC1 to improve SYCA for High-earners – PVY22 to reduce base-cost 34
  35. 35. Period 4 2. Decision MakingBrand portfolio SYGU: Singles SYCA: High Earners SYPO: Pros SYOO: Others VYTO: Followers VYAD: Adapters 35
  36. 36. Period 4 2. Decision Makingo Increase – Production – Ads & Ads research – Sales 36
  37. 37. Period 43. Results 37
  38. 38. 38
  39. 39. o Good products 4873o Strategy go wello More market shareo Stock increased (well it always increased!!)o Technical problems-we couldn’t take loan – 1 vodite R&D project incompledted – Lower brand awareness 39
  40. 40. Period 5o Game will be play until Period 9o Period 7 has the special evento Growth too fast ??? 40
  41. 41. Period 5 1. Analysiso We controlled Sonite, but did not control Voditeo Team I was rising in Voditeo Not enough money for WARo Decide to take loan - 10mil 41
  42. 42. Period 5 2. Decision Makingo R&D – PSYG2 for Singles – PVY12 : reduce cost of Vodie products 42
  43. 43. Brand portfolioSYGU: Singles SYCA: HiEarnersSYPO: Pros SYOO: OthersVYTO: FollowersVYAD: Adapters 43
  44. 44. o Marketing mix 44
  45. 45. Period 5 3. Results• Capture more market share in Singles and Others, Vodite• Market share decreased in Pros and Others• Have a big loan to payback• However, stock increased• Total expenditure was too high 6474 45
  46. 46. 46
  47. 47. o Net contribution 119,640 --> Budget 35,450o Net contribution 581,770 --> Budget 35,450 Whatttttt !?!? 47
  48. 48. Period 6o We have to pay the loan of 10milo Manage many Brands  expense too mucho Period 7 is very important – Bonus based on % stock raiseo Our Brands for Pros and Others did not work wello Our sale forces expenditure seemed to be too higho Vodie market grow too fast and very potential  we have to control it 48
  49. 49. Period 61. Analysis E entered Vodie market Risk 49
  50. 50. Followers segment could be bigger than Sonite in period 7 50
  51. 51. OK 51
  52. 52. HIGHI’s product (Followers) is better than us, the only problem is their pricing strategy 52
  53. 53. The lost sales of our Brands  opportunity for other teams 53
  54. 54. Brand Awareness of I and U in Followers segment were not high 54
  55. 55. Period 6 2. Decision-making  Open 3 new brands in Vodieo Focus on Vodie  Focus all Vodie Brands on Followers  Withdraw the Otherso Give up the Sonite market  Reduce the volume of Singles, Hiearners, Proso Win the Bonus in Period 7  Not purchase any Sonite research Keep the Stock rise slightly in P.6 & Have needed things to win the Bonus in P.7 55
  56. 56. Our decisionsSonite market Reduce the production  keep the Stock low 56
  57. 57. Our decisions Gain the BrandVodie market Awareness 57
  58. 58. Period 63. Results Higher than what we want 58
  59. 59. Over 9500 We got the o Each Brand can produce maximum 2000K productsADVANTAGE o The Followers size rises significantly 59
  60. 60. Period 71. Analysiso The Vodie Analysis Tools have not worked well yet Other teams would have the problems like us in R&Do We get the advantages in Vodie market dominate other teamso Vodie market size would be over 12000 in Period 8 & we can run maximum 5 brands come back to the Sonite market 60
  61. 61. Period 7 2. Decision-making o Come back to Sonite market o Limited budget we could not spend moreBuy 4 studies for the Sonite market: Consumer survey, Consumer panel, Semantic Scale and Market forecast 61
  62. 62. For VodieIn good situation, we 5 Brands with the total of 7500can get90%  6000<our sales<9000market share 62
  63. 63. Period 73. Results Dominated the Vodie market Come back and gain ~1/4 Sonite Team O earn the benefit of our scarification in Sonite market 63
  64. 64. Period 73. Resultso Rank second in the events, got extra moneyo A lot of lost sales in Sonite, if we produced more, maybe we will win since almost money team O gained from Singleso Stock rise to over 13000 64
  65. 65. Period 81. AnalysisO entered Vodie market, they have lots of money and the strong base in Sonite 65
  66. 66. As what we forecasted, Followers in this period would beover 12000  we have to share the Vodie market withother teams… 66
  67. 67. Period 81. Analysiso The estimate tools for Vodie is now OKo Other teams spent a lot in R&Do Our Sonite products is now worse than others We have to improve our Product 67
  68. 68. Period 82. Decision Makingo Take the loan of 4milo R&D  PVYYY: with all the ideal characteristics for Followers, but very high base cost  PSYG3: Improve for Singles segment  PSYHH: Improve for Hiearnerso Reduce the Sale forceso Increase production in Sonite 68
  69. 69. Increase Production and Ads to take back the market share 69
  70. 70. Produce a total of 8000 products 6400<sales<9600 Restraint the market 70
  71. 71. Period 8 • Our Sonite grow from 23 to 34%3. Results • O grow 0.7% • Our intentional low production in Vodie gave other teams some gifts 71
  72. 72. 72
  73. 73. Period 9 The Followers size of P8 is1. Analysis 11674, not over 14303 Good for us We could earn 12000/~17000, which is 70% 73
  74. 74. All of them get scared of setting a low price as ideal price BUT WE DO NOT 74
  75. 75. Our base cost is 611, the forecasted Ideal price for Follower is ~ 420,and the price accounts to over 49% of importanceIs this a big Problem ?? 75
  76. 76. o Base cost: 384  transfer cost: 96 Could earn Base cost: 611  transfer cost ~ 150-200o Sell at price 423  the selling price is 286 ~$100/product However, the contribution would be reduced 76
  77. 77. • Sonite market also grows up a lot• Completed the R&D, we got strong products for Singles and HiEarners 77
  78. 78. Period 9 2. Decision Makingo Produce maximum for 5 Brands of Vodie, want to gain 12000 in saleso Modify 5 Vodie Brands, using new R&D projecto Produce maximum for Hiearner and Singles, using new productso Open the new Brand for Single and produce 1000 to take shares from other teams (this is risky, we can get many inventories, however, it would be 5-7 mil in bad case, in good situation, we could gain a lot) 78
  79. 79. Semantic ScaleBased on Semantic Scale & Conjoint Analysis 79
  80. 80. Set the Price higher than ideal price and use Perceptual Objectives to improve it 80
  81. 81. Period 9 We WIN Team Y did3. Results not perform well? Team O is amazing?? 81
  82. 82. LET’s SEE 82
  83. 83. 83
  84. 84. • They produced a lot and want to replace us• However, they stuck in big problem 84
  85. 85. <o Dominate the Sonite againo Reach the limit of game by selling all 12000 Vodie product 85
  86. 86. 4 LESSONS EARNED 86
  87. 87. 1. First mover into Vodie market experienceo Lower cost for R&Do Dominate the market with large shares  gain more budgeto Know the market better than others (not sure since we didn’t know whether other teams can see the Vodie studies or not)o Vodie market is very potential, the market size would be larger than Sonite in few periodso In Vodie, focus 100% on Followers, this segment will account to over 95% of the market. So, don’t waste money on other segmentso The forecast of Vodie is not accurate at some first few periods. In our course, from P3 to P6, the actual market size always > forecast one  plan your production wiselyo The estimate tool could not be used in first 2 periods and even when it began working, the accuracy is not good  if your product is worse than others: can use the Brand map and competitor product’s characteristic to conduct R&D project. 87
  88. 88. 2. Set up objective and strategy experienceo Always try to satisfy the customers, but, do it wiselyo The objective and strategy should cover at least 2 following periods – think about long term, not short termo Be proactive and flexible – Foresee the trend and dare to changeo Think about the milestones of the game ( P1,2,6 and 8) to get the right strategyo Sacrifice is needed if you want to earn more (P6) 88
  89. 89. 3. Budget experienceo The key factor of successo It has the upper limit  if you run a big business like us, your job is not easyo In this game, we:  Spend all the money in first, second periods  gain more market share, contribution and lessen the budget of others  we have enough money to R&D Vodie, etc while others can not  Spend all the money in other periods caused we have to run a very big business…o Tips:  Ads is needed, spend more and earn more, but when you control the segment, 2500-3000 is enough  The longer the game is, the more expensive the R&D would be  R&D for 2 or 3 period in the future. If we in P3, we would R&D for P5 or P6  Allocate sale force effectively, at the beginning, for 100K products we used 10 people, at the end, for 100k products we used 3 people, and they still did the job well  Use the loan at right time could give you a big advantage 89
  90. 90. 4. Number setting technique experienceo For production plan, you have +/- 20% automatic adjustment  use ito Price & Perceptual Objective : use the semantic scale or MDS, but use the next period forecasted numbero You can set the price lower than base cost as long as it larger than the transfer costo For the sales force, use shopping habit as a tool to allocate, but, adjust the percentage to next period by yourself since the number you got is the current oneo R&D: use the analysis tools to get the characteristics of project, however, should take a look at the numbers and self adjust them, don’t believe the program 100% P7 P8 P9: 56-21-23 90
  91. 91. 6. Other experienceso For each market, your firm can only manage 5 brands, each brand produce a maximum of 2000k products (can auto-adjust to 2400)o For each market, the maximum you can produce is 12000o Good product is the key factor to increase market share, not the adso Your can take advantage of ads in special way: open a brand based on old R&D project with a low production (50-100K) and a high ads  gain brand awareness. Then when the project complete, you modify that brand with new characteristicso Buy the studies effectively, at the beginning, you should buy all of them to get a broad view, but in next periods, you can eliminate some of them.o For us: Benchmarking, Consumer survey, Consumer panel, Market forecast and one analysis tools (Semantic scale or MDS) are required. The conjoint analysis you just need it one time. The others do not add much values 91
  92. 92. And more important…o The leader has advantages, but those could not ensure a victory  always try your best and be carefulo Other teams can catch up the leader, in 2-3 last periods, many teams have the maximum-same budget, event the leader  Spend money in smart way and make the different 92
  93. 93. WHY “Y” WIN ?
  94. 94. Team Ytook itmoreserious
  95. 95. 1
  96. 96. Read the bookPractice FileLearning curve
  97. 97. 2 Focus “I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.”
  98. 98. 2 Focus Well, One brand is for just One segment
  99. 99. 3 Be Innovative
  100. 100. Be Innovative I mean R&D“Innovation distinguishes between a leader and a follower.”
  101. 101. Leader – heavy R&D, just a bit marketing & ads
  102. 102. Follower – Heavy advertising, somewhat R&D
  103. 103. Few R&D are falling behind?
  104. 104. 4 Dare to Risk Dare to Risk
  105. 105. 5 Be Flexible
  106. 106. THANK YOU for your listening 108

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