MM 2011.03

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Marketing Management 03

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MM 2011.03

  1. 1. Week 3<br />Marketing Management<br />
  2. 2. Strategic Analysis<br />External and Customer Analysis<br />PPT 3-2<br />
  3. 3. External and Customer Analysis<br />PPT 3-3<br />“To be prepared is half the victory.”<br />- Miguel Cervantes<br />
  4. 4. The Role of External Analysis<br />Strategic Decisions<br /><ul><li> Where to compete
  5. 5. How to compete</li></ul>External<br />Analysis<br />Identification<br /><ul><li> Trends/future events
  6. 6. Threats/opportunities
  7. 7. Strategic uncertainties</li></ul>Analysis<br /><ul><li> Information-need areas
  8. 8. Scenario analysis</li></ul>Figure 3.1<br />
  9. 9. External Analysis<br />
  10. 10. Strategy funnel – industry side<br />Environmental Trends<br />Customer &Benefits<br />IndustryStructure<br />CompetitiveSpace<br />Segment Size Channels<br />Industry<br />Market<br />CompetitiveDynamics<br />PerceptualSpace<br />Strategic Positioning<br />ValueProposition<br />
  11. 11. I. Environmental Scanning: STEEP analysis<br />Macro-environment<br />Socio-culturalForces<br />OperatingEnvironment<br />Union/employees<br />Communities<br />Firm/Organization<br />StructureCultureCompetencies Resources<br />TechnologicalForces<br />PoliticalForces<br />Trade Association<br />Regulators<br />Competitors<br />Stockholders<br />Creditors<br />Suppliers<br />EconomicForces<br />EcologicalForces<br />Customers<br />
  12. 12. OperatingEnvironment<br />Union/employees<br />Communities<br />Firm/Organization<br />StructureCultureCompetencies Resources<br />Trade Association<br />Regulators<br />Competitors<br />Stockholders<br />Creditors<br />Suppliers<br />Customers<br />Stakeholders shape the operating environment<br />Macro-environment<br />Socio-culturalForces<br />TechnologicalForces<br />PoliticalForces<br />EconomicForces<br />EcologicalForces<br />
  13. 13. Company competitive analysis<br />How does each firm compete? <br />Quality, service, low price, something else?<br />How effective is each? <br />How well designed are they to compete as they do?<br />How powerful?<br />What resources do they control? Money, people, influence...<br />How aggressive?<br />How hard do they compete? What’s their trajectory?<br />
  14. 14. Future GoalsVision statementManagerial behavior<br />Current StrategyPrice, quality, distribution, resources<br />Critical AssumptionsKey beliefsBlind spots<br />CapabilitiesStrengths & weaknesses<br />Competitor response profile<br />Drivers<br />Abilities<br />Response ProfileSatisfied or ambitious?Likely next moves?Vulnerabilities?Sensitive spots? (What will provoke retaliation?)<br />
  15. 15. Market Share <br />Quality<br />Cost<br />Effective-ness<br />Aggres-siveness<br />Power<br />M<br />Competitor1<br />15%<br />H<br />H<br />M<br />H<br />Competitor2<br />25%<br />very<br />L<br />L<br />H<br />L<br />Competitor3<br />5%<br />M<br />M<br />L<br />H<br />Competitor4<br />20%<br />L<br />L<br />H<br />slipping <br />L<br />Competitor5<br />15%<br />M<br />M<br />H<br />Competitors table<br />Organizes competitors using crucial dimensions of competition, plus effectiveness, power, trajectory, likely changes...<br />
  16. 16. Strategic groups<br />Upscale Chains<br />Price<br />Diners/Family Style<br />Fast Food<br />Selection<br />Groups of firms that pursue similar strategies with similar resources<br />
  17. 17. Example: Variation on Gartner’s Magic Quadrant<br />
  18. 18. Dynamic competitor analysis<br />While useful, the competitor table and the strategic groups are essentially static.<br />It is critical to make guesses about the future -- especially about when trends might stop and the ground might shift, and when new competitors might rise, or existing ones die.<br />
  19. 19. Exercise: Competitor analysis<br />Make a competitors table, including:<br />market share<br />how they stack up on crucial dimensions of value<br />effectiveness (star the most competent ones)<br />resources (underline richest ones)<br />aggressiveness (arrows to indicate trajectories)<br />Note any natural groupings<br />Note any likely changes<br />New entrants, mergers, exits?<br />
  20. 20. Investment DecisionFour Sound Questions<br />Should existing business area be liquidated, milked, maintain, or a target for investment?<br />What growth directions should receive investment?<br />Should there be market penetration, product expansion, or market expansion?<br />Should new business areas be entered?<br />
  21. 21. Strategic Options<br />What are the value propositions?<br />What are the key success factors (KSF)?<br />What assets and competencies should be created, enhanced or maintained?<br />What strategies and programs should be implemented in functional areas?<br />What should be the positioning strategy, segmentation strategy, distribution strategy, brand-building strategy, etc.<br />
  22. 22. Strategic Uncertainties<br />External and Customer Analysis<br />PPT 3-18<br />
  23. 23. Strategic Uncertainties<br />
  24. 24. Strategic Uncertaintiesvs. Strategic Decisions<br />Strategic Uncertainties<br />Will a major firm enter?<br />Will a tofu-based dessert product be accepted?<br />Will a technology be replaced?<br />Will the dollar strengthen against an off-shore currency?<br />Will computer-based operations be feasible with current technology?<br />How sensitive is the market to price?<br />Strategic Decisions<br />Investment in a product market<br />Investment in a tofu-based product<br />Investment in a technology<br />Commitment to off-shore manufacturing<br />Investment in a new system<br />A strategy of maintaining price parity<br />
  25. 25. Customer Analysis<br />Segmentation<br />Who are the biggest customers? The most profitable? The most attractive potential customers? Do the customers fall into any logical groups based on needs, motivations, or characteristics?<br />How could the market be segmented into groups that would require a unique business strategy?<br />Figure 3.2<br />
  26. 26. Judging a Segmentation Strategy<br />Can a competitive offering be developed and implemented that will be appealing to the target segment?<br />Can the appeal of the offering and the subsequent relationship with the target segment be maintained over time despite competitive responses?<br />Is the resulting business from the target segment worthwhile, given the investment required to develop and market an offering tailored to it?<br />
  27. 27. How Should Segments be Defined?<br />Customer Characteristics<br />Geographic<br />Type of organization<br />Size of firm<br />Lifestyle<br />Sex<br />Age<br />Occupation<br />Figure 3.3<br />
  28. 28. How Should Segments be Defined?<br />Product-Related Approaches<br />User type<br />Usage<br />Benefits sought<br />Price sensitivity<br />Competitor<br />Application<br />Brand loyalty<br />Figure 3.3<br />
  29. 29. The Loyalty Matrix: Priorities<br />Low<br />Loyalty<br />Moderate<br />Loyalty <br />Loyal<br />Medium<br />Highest<br />High<br />Customer<br />Low<br />to<br />Medium<br />Non-customer<br />High<br />Zero<br />Figure 3.4<br />
  30. 30. Customer Analysis<br />Customer Motivations<br />What elements of the product/service do customers value most?<br />What are the customers’ objectives? What are they really buying?<br />How do segments differ in their motivation priorities?<br />What changes are occurring in customer motivation? In customer priorities?<br />Are there any “Hot Buttons” whose salience and impact on the market are significant and growing?<br />Figure 3.2<br />
  31. 31. Customer Motivation Analysis<br />Identify<br />Motivations<br />Group and<br />Structure <br />Motivations<br />Assess <br />Motivation<br />Importance<br />Assign Strategic<br />Roles to Motivations<br />Figure 3.6<br />
  32. 32. The Customer as Active Partner<br />Encourage Active Dialogue<br />Mobilize Customer Communities<br />Manage Customer Diversity<br />Co-creating Personalized Experiences<br />
  33. 33. Customer Analysis<br />Unmet Needs<br />Why are some customers dissatisfied? Why are some changing brands or suppliers?<br />What are the severity and incidence of consumer problems?<br />What are the unmet needs that customers can identify? Are there some of which consumers are unaware?<br />Do these unmet needs represent leverage points for competitors?<br />Figure 3.2<br />
  34. 34. Identifying Unmet Needs<br />Conduct Market Research<br />Use The Ideal Experience<br />Use Creative Thinking<br />Separate ideation from evaluation.<br />Approach the problem from different mental and physical perspectives.<br />Have a mechanism to take the most promising ideas and improve them until they turn into potential winners worth trying. <br />
  35. 35. Relevant Assets and Competencies<br />Chapter 3 - Competitor Analysis<br />PPT 3-31<br />1)-What businesses have been successful over time?<br /> -What assets or competencies contributed to their success?<br /> -What businesses have had chronically low performance?<br /> -Why?<br /> -What assets or competencies do they lack?<br />
  36. 36. Relevant Assets and Competencies<br />Chapter 3 - Competitor Analysis<br />PPT 3-32<br />-What are the key customer motivations? <br /> -What is needed to be preferred?<br /> -What is needed to be considered?<br /> -What is really important to the customer?<br />What assets and competencies represent industry mobility (entry and exit) barriers? <br />
  37. 37. Relevant Assets and Competencies<br />Chapter 3 - Competitor Analysis<br />PPT 3-33<br />4) -What are the significant value added components in the value chain?<br /> -Do any provide the potential to generate a competitive advantage?<br />

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