Business Ecosystems - KSOM Bhubaneshwar


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Business Ecosystems - KSOM Bhubaneshwar

  1. 1. Perfect Relations Perfect Image Management Relations The Science of The Science of Image Management Business Ecosystems: Driving New Paradigms in Marketing 1
  2. 2. Value creation is the name of the Game today Context Moving beyond price: experience is a key in segments like food chain, entertainment and travel. Value creation could command a significant price premium “Marketing is not the art of finding clever ways to dispose of what you make. It is the art of creating genuine customer value.” -- Philip Kotler “Companies that solely focus on competition will ultimately die. Those that focus on value creation will thrive.” -- Edward De Bono Inference •Connectivity, digitization of businesses and all powerful information exchange through social networks are challenging the traditional business models. Approach to value creation is changing rapidly in today’s world of business. •It is important for managers, to be deeply sensitive to the technology driven ecosystems as well as manage how the physical environment is changing around them as a result of it…. Additional Reading 10 Ways Social Media Technologies are Adding Value and Productivity 2
  3. 3. The mass market is dead, replaced by the mass of niches Context Customization is the key -- the needs of the end-customers vary, requiring nuanced targeting and micro segmentation “You want to dig your well where you have the best chance of finding water with the least amount of digging.” -- Theodore Levitt “Don’t find customers for your products, find products for your customers.” -- Seth Godin “What's measured improves” -- Peter F. Drucker Inference •“The mass market is dead, replaced by the mass of niches” – The future of the Businesses could be about Selling in a wide variety of niches….many small products that wouldn‘t sell on their own. This typical Long Tail Phenomenon is now seen happening in retail and broadcast especially the entertainment industry… Additional Reading The Long Tail : Why the Future of Business Is Selling Less of More 3
  4. 4. Today ….Markets are conversations Context Popular bloggers and fan pages play an important role in influencing opinions. Social media presence can also help in generating positive buzz, though risks of misuse also exist “Privacy is dead, and social media holds the smoking gun.” -- Pete Cashmore “The best way to persuade people is with your ears – by listening to them.” -- Dean Rusk, Former U.S. Secretary of State “Everything we hear is an opinion, not a fact. Everything we see is a perspective, not the truth.” -- Marcus Aurelius, Meditations Inference •Today’s marketing is about managing the Talk around you. Altering the behavior of the Buzz in your favor is key •Remember, conversations too have their socio-cultural, political and economic context. In the digital age, corporations no longer deal with green environmental activism or the red flag bearers alone. Conversations around Communities are fast becoming the agenda setters. If there is a Gulag, it will find its way to Google Additional Reading The Cluetrain Manifesto 4
  5. 5. Powerful customer communities can build around Feedbacks and conversations Context Customer retention is much more important now than before. Social media provides dissatisfied customer enough avenues to damage a brand’s image “If you do build a great experience, customers tell each other about that. Word of mouth is very powerful.” -- Jeff Bezos, CEO “Customer satisfaction is worthless. Customer loyalty is priceless.” -- Jeffrey Gitomer Inference •Customers are in total control today. Their opinions and views are no longer restricted by borders anymore. The web enables a worldwide reach •Customer communities both for and against you can form rapidly – your image depends on how well you are connected with them Additional Readings Building Customer Communities Is the Key to Creating Value A Sampling of Community Scripts 5
  6. 6. The Community phenomenon also impacts employees Context Organizational culture can have positive impact on brand image. Tatas in India have highlighted their work ethic to position themselves as a ‘trustworthy’ brand “Imagine a world where what you say syncs up, not sinks down.” -- Stan Slap “A culture is made -- or destroyed -- by its articulate voices.” -- Ayn Rand Inference •So the traditional HR structures and strictures are set to change. Conversations around employee Communities are fast becoming the agenda setters Even a loner with a laptop can seriously challenge status quo. If there is a Gulag, it will find its way to/on Google! Additional Reading HR and Marketing Converge: Learn an Integrated Marketing Strategy to Create Brand Ambassadors, Support the Employer Brand and Improve Community Relations 6
  7. 7. Customer collaboration is important today to sell Context Internet, especially social media, has virtually nullified information symmetry between brand and customer. Customers are better informed about substitutes and competitor products, Customer feedback could be instrumental in developing better products. “New marketing is about the relationships, not the medium.” -- Ben Grossman “Customers will want to talk to you if they believe you can solve their problems.” -- Jeffrey Gitomer Inference •No longer is it possible to command premium or profit by controlling access to goods, or information. In this day of ecommerce be sure that the customer will get access to the cheaper and the better •Collaborating with customers is key today. Let the market tell you what they want from you Additional Reading In Social Media, Collaboration is King The Power of Personalization: Customer Collaboration and Virtual Communities 7
  8. 8. Hence, platform based networks are critical for marketing success “Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality.”-- Peter Drucker Inference •The most successful companies today are large networks built on robust technology platforms. Additional Readings How To Become A Billion Dollar Startup: AirBNB, Youtube and Platform Thinking What Would Google Do? 8
  9. 9. Virtual presence is now a compelling reality Context Traditional push-based mass marketing has given way to customized ads targeted at a particular customer. This has been made possible through technology. “Any sufficiently advanced technology is indistinguishable from magic.” -- Arthur C. Clarke Inference •Technology is driving this change in the business ecosystem and changing the traditional concepts of marketing. As Jeff Jarvis says “if you are not searchable, you will NOT be found” Additional Reading The Importance of Your Company's Virtual Presence How to Turn Customers into Brand Ambassadors No Bullshit Social Media : The All-business, No-hype guide to Social Media Marketing 9
  10. 10. So your customers find you more than you find them Context From push-based the emphasis has shifted to pull-based marketing. Apple, for example, had just one ad. Its demand is primarily driven through product design and customer reviews. “A brand is no longer what we tell the consumer it is – it is what consumers tell each other it is.” – Scott Cook “The purpose of a business is to create a customer who creates customers.” -- Shiv Singh, author Inference •Now most often your customers find you when they want to work with you. And then they become your advertising agency if they are satisfied. Additional Readings Top 5 Inbound Marketing Campaigns 2013 The Top 7 Online Marketing Trends That Will Dominate 2014 The LEGO - Apple - Nordstrom Expert Path To Customer Loyalty: Consulting How Great Brands Build Customer Service Engagement brick-by-brick-approach/
  11. 11. New age marketing is all about connecting people through connecting devices Context Finding new ways to engage with customers is a Critical Success Factor. Higher engagement with customer is key to customer retention “Hyperlinks are the 21st century equivalent of the name-dropper.” -- Chris Brogan & Julian Smith, authors of Trust Agents Inference •So many companies are finding newer ways of connecting with the customers through enabling technologies that has bred a brand new ecosystem •Platforms such as Apple, Google, Amazon, Facebook, and Microsoft are now in the forefront of a revolution in building ecosystems that help companies to connect with their customer communities, employees, suppliers, and partners. Additional Reading Ecosystem Innovation: New Age Business Models 11
  12. 12. In this digital era, Transparent and Network based ecosystems for marketing is all powerful Context User feedback and customer reviews are essential determinants of choice. “Your most unhappy customers are your greatest source of learning.” -- Bill Gates Inference •Taking the transparency point further, Apple, Groupon, and Amazon are examples of such business ecosystems that are now connecting their customers to content creators and other partners. This phenomenon is not an exception but a rule that cuts across sectors •Such ecosystems are emerging as a critical asset in the success of business models in industries ranging from healthcare and education to entertainment services. Ignoring this trend can seriously impact business success Additional Reading The New Age of Innovation::Mobilising Global Networks to Unlock Co-Created Value in Your Company 12
  13. 13. And … Free is often a business model! Context Customer-brand engagement is not restricted to price-value model. The benefits go beyond the commercial transaction Facebook which has remained a free platform for sharing information has 100 petabytes of user information -- a gold mine for digital marketing and advertising “Do what you do so well that they will want to see it again and bring their friends.” -- Walt Disney Inference •Amazon recently announced that the sales of their digital books have already surpassed traditional printed books. The impact of this change now expands beyond book retailing to the publishing industry •In the telecom industry, this impact is now even more widespread. The VAS is where the value lies. The enterprise phones and their enabling platforms such as Apple, Android or even the BBM ecosystems through smart phones have rendered traditional voice telephony almost free! •Telecom companies are now forced to reinvent their business models by forging partnerships with device makers and content creators. Entertainment, games, music and streaming content have redefined the way telecom services used to be even 5 years ago Additional Reading Free! Why $0.00 Is the Future of Business 13
  14. 14. IT is the clear enabler and lends the leadership edge Context Technology now provides lead assessing synergies across segments. Brands are now present in more than one segment. Google, for example, started as a search engine, but now has a browser, social network and operating system Inference •Finally, managers need to embrace information technology to innovate on ways of expanding and even maintaining their current market shares. These new platforms and technologies have given birth to an interconnected ecosystem that has virtually changed the way traditional businesses were conducted Additional Reading The Hidden Benefits of Social Media Marketing: Why Your Strategy May Be Working Better Than You Think 14
  15. 15. Other impacting factors 15
  16. 16. When the urban and rural divide is more about consumer attitudes Context Certain markets in India are characterized by long supply chains involving producers in rural areas, wholesalers, dealers and retailers and eventual customers in urban areas. Inference •Urbanization in India maybe taking time to penetrate from a development index perspective but growing aspirations and guilt free consumerism is now breeding a new cusp between the semi and the ultra-urban. •We haven’t seen a rising demand for cheeses yet but chocolates are surely catching up AND the marketers are cashing in on that….Check the Kumbh Mela merchandise and you will see technology products making steady inroads Additional Reading Chocolate Tempts India's Sweet Tooth 16
  17. 17. Where angels dare - The funding formulae ! Context Profitability is not the sole criterion for funding decisions. Growth, which factors in variables like market size, customer profile, social relevance etc has made funding decisions go beyond the traditional revenues-cost model. Inference The character of Funding is also changing. From Microfinance to Bank loans, it’s now time for ideas that get crowd-sourced capitals. Note that even funds seek to market themselves to their niches…the private equities, the venture caps are the new angels who are looking to incubate ideas and entrepreneurs across sectors Additional Readings Which are the best ‘crowdfunding’ websites? How Can Entrepreneurs Motivate Crowdsourcing Participants? 17
  18. 18. When new markets are about new ideas! Context: Novel ways to engage are a key to understanding and meeting these needs “The nature of the Internet and the importance of net neutrality is that innovation can come from everyone.” -- Al Franken Inference •Ideas are now driving markets as they are now waking up to newer ways of innovation where free is also a business model. The skill lies in cleverly back linking your revenue models with freebies that flirt with consumers while quietly getting them hooked onto a product or a service Additional Reading: Dropbox: The Inside Story Of Tech's Hottest Startup 18
  19. 19. When new technologies are key to market leadership “If you look at the various strategies available for dealing with a new technology, sticking your head in the sand is not the most plausible strategy.” -- Ralph Merkle Inference •Manufacturing is changing too. It is now rediscovering itself from the traditional to becoming the ‘newold’ Remember this is where the rubber hits the road, where real people make stuff that must reach to real customers. But cutting edge technology such as 3D printing and Green engineering are rapidly taking over Additional Reading 3D printing: the new, bottom-up industrial revolution 19
  20. 20. When you must train to be a sharp shooter and a smart disrupter Inference •In the end – this business ecosystem is making marketers into learners, adapters and innovators. •Training to be a part of this global change is now key to survival. This new age training is increasingly focusing on learning around Designs, Devices and Disruption! Additional Reading How to harness disruptive innovation as a modern marketer 20
  21. 21. For more reviews and your views, get in touch with Dilip at: Twitter: Linkedin: Email: Blog: Office Address: Perfect Relations Pvt. Ltd. S 27, Star City, Mahatta Towers District Centre, Mayur Vihar, Phase I Delhi - 110091 21