Building Sustainable Business


Published on

Building sustainable business

  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Building Sustainable Business

  1. 1. Empowering New BusinessBuilding Sustainable Business// About Marketing Strategy & OrganizationLecturer: Marian Dragt
  2. 2. Overview // Business Models// Strategy // Customer Segments// Direction, Future and // Value Propositions Sustainability // Distribution Channels// Advantage & Environment // Customer Relationships// Understanding the Business // Partner Network // Key Activities // Key Resources // Revenue Streams // Cost Structure // Example Business Model // Try it yourself! // References & Contact Details
  3. 3. “Marketing isbuilding sustainablebusiness”// Business: the objective of marketing is to realise organisational goals, through the exchange of ‘offerings’ (goods and services) with customers;// Sustainable: to ensure the survival of the company as a going-concern, value must be created for the company as well as for the customer;// Building: the results of a company are the result of the integrated efforts of the whole organisation. – Moenaert & Robben
  4. 4. “Visionary marketing relates tothe planning and theimplementation of marketingactivities in order to optimise thecompany’s current and futurecompetitiveness”// Where are you now?// Where do you want to be?// How do you get there – Moenaert & Robben
  5. 5. It’s all aboutStrategy…// “Strategy is the direction andscope of an organization overthe long term: which achievesadvantage for the organizationthrough its configuration ofresources within a changingenvironment, to meet theneeds of markets and to fulfillstakeholder expectations.” Source: Johnson and Scholes (2002)
  6. 6. Direction//What’s your ambition and vision? Long term //And what about the future?
  7. 7. And what about Sustainability?
  8. 8. Advantage & Environment//Please look outside…you’re not alone!
  9. 9. Advantage & Environment//Please look outside…you’re not alone! Product / Service The CODA (Customer’s Outlook on Differentiating Advantages) // What do you offer? Image // How and where do you offer it? // What are the costs to the customer? Customer Price // What do you represent? Process Source: Robben & Moenaert (2008)
  10. 10. Advantage & Environment//Please look outside…you’re not alone! Socio-cultural Technological Environment Environment SuppliersAction EnvironmentDirect and Indirect Competitors Company Complementors Customers Political Economic Environment Environment Source: Robben & Moenaert (2008)
  11. 11. Advantage & Environment//Please look outside…you’re not alone! Socio-cultural Technological Environment Environment SuppliersAction EnvironmentDirect and Indirect Competitors Company Complementors Customers Political Economic Environment Environment Source: Robben & Moenaert (2008)
  12. 12. Industrialstructure// Subsistence economies Economic// Raw material exporting economies Environment// Industrializing economies// Industrial economies EconomicIncome factors reflectdistribution a country’s// Low-income households attractiveness// Middle-income households// High-income households as a market ©2012 Pearson Education
  13. 13. Political-Legal Environment // Country’s attitude toward international buying // Government bureaucracy // Political stability // Monetary regulations©2012 Pearson Education
  14. 14. Your Environmentif you are a GlobalCompany// You operate in more than one country// You gain marketing, production, R&D,and financial advantages not available topurely domestic competitors// You see the world as one market
  15. 15. Why go Global? // Global competitors might attack the home market // More growth in foreign markets // Customers might be expanding abroad But… // Difficult to understand foreign©2012 Pearson Education buyers // Making products competitive // Adapting to foreign business conditions // International experience of managers // International regulations
  16. 16. Questions for Global Companies// What market position should you try to establish in your own country, in your economic region, and globally?// Who will your global competitors be, and what are their strategies and resources?// Where should you produce or source your product?// What strategic alliances should you form with other firms around the world?
  17. 17. Understandingthe Business// What do you offer?// How and where do you offer it?// What are the costs to the customer?// What do you represent?…How do youdo that? – Moenaert & Robben
  18. 18. Business Models“Stories that explainhow enterpriseswork”// A good business model begins with an insight into human motivations and ends in a rich stream of profits. Source: Magretta (2002)
  19. 19. Partner Key Activities Value Customer CustomerNetwork The most Proposition Relationships SegmentsThe partners and important The bundles of The types of Your group ofsuppliers you activities products and relationships you customers withwork with performed to services that entertain with distinct implement your satisfy your each customer characteristics business model customer segment Distribution segment’s needs Key Channels Resources The channels The key resources through which you on which your communicate with business model is your customers built and offer your value propositionCost structure Revenue streamsThe costs you incur to run your business model The streams through which you earn your revenues from your customers for value creation and customer facing activities The Business Model Canvas // Which story are you telling? Source: Osterwalder & Pigneur: Business Model Generation (2010)
  20. 20. The Business Model Canvas// The building blocks Partner Customer Network Relationships Key Value Customer Resources Proposition Segments Distribution Key Activities Channels Cost Revenue structure streams Source: Osterwalder & Pigneur: Business Model Generation (2010)
  21. 21. Customer Segments// For whom are you creating value?// Who are your most important customers?// Who pays?
  22. 22. Customer SegmentExamples// Mass Market// Niche Market// Segmented// Diversified// Multi-sided Platform
  23. 23. Customer Segment Examples // Mass market// Niche markets // Diversified // Segmented // Multi-sided platform
  24. 24. Customer SegmentQuestions// Do you know your customers and their needs good enough?// Are some customer groups likely to defect soon?// Do you regroup different customer segments well enough?
  25. 25. Global MarketSegmentation// Demographics// Psychographics// Behavioral characteristics// Benefits soughtSkiing became a sport in Norwaywhere it was invented 4,000 yearsago. ©2012 Pearson Education
  26. 26. DemographicSegmentation// Income// Population// Age distribution// Gender// Education// Occupation ©2012 Pearson Education
  27. 27. Communicationis about perception
  28. 28. Global Consumer Culture// Culture–ways of living, built up by a group of human beings, that are transmitted from one generation to another// Culture has both conscious and unconscious values, ideas, attitudes, and symbols// Culture is acted out in social institutions// Culture is both physical (clothing and tools) and nonphysical (religion, attitudes, beliefs, and values) ©2012 Pearson Education
  29. 29. Cultural Environment “The need to adaptCulture Marketing to local cultural values and traditions rather than imposing their own” ©2012 Pearson Education
  30. 30. Value Propositions// What value do you deliver to the customer?// Which one of your customer’s problems are you helping to solve?// What bundles of products and services are you offering to each Customer Segment?// Which customer needs are you satisfying?
  31. 31. ValuePropositionCharacteristics// Newness// Performance// Customization// “Getting the Job Done”// Design// Brand/Status// Price// Cost Reduction// Risk Reduction// Accessibility// Convenience/Usability
  32. 32. Glocalization
  33. 33. Aesthetics “Aesthetic elements that are// The sense of what is beautiful and what is not beautiful seen as attractive in one// What represents good taste as country may be viewed opposed to tastelessness or differently in another.” even obscenity// Visual–embodied in the color or shape of a product, label, or package// Styles–various degrees of complexity, for example, are perceived differently around the world ©2012 Pearson Education
  34. 34. Value PropositionsQuestions// Does your value proposition still cater well enough to your clients’ needs?// Do you know how your customers perceive your value proposition?// Are your competitors offering similar value propositions at similar or better prices?// How well are your customers served by other competitors?
  35. 35. Distribution Channels// Through which Channels do your Customer Segments want to be reached?// How are you reaching them now?// How are your Channels integrated?// Which ones work best?// Which ones are most cost-efficient?// How are you integrating them with customer routines?
  36. 36. 1. Awareness 2. Evaluation 3. Purchase 4. Delivery 5. After sales// How do you // How do you // How do you // How do you // How do youraise help allow deliver a provide post-awareness customers customers to Value purchaseabout your evaluate your purchase Proposition to customercompany’s organization’s specific customers? support?products and Value products andservices? Proposition? services? Distribution Channel Phases
  37. 37. DistributionChannels Questions// Do you have a well thought-through communication and distribution channel design?// How well do you reach your clients?// Do you know how successful your channels are in terms of customer acquisition?// How well are your different channels integrated?// Do you know how cost efficient are your channels are?// Do you use the right channels for the right clients (e.g. in terms of profitability)?
  38. 38. CustomerRelationships// What type of relationship does each of your Customer Segments expect us to establish and maintain with them?// Which ones have you established?// How are they integrated with the rest of your business model?// How costly are they?
  39. 39. CustomerRelationshipsExamples// Personal assistance// Dedicated Personal Assistance// Self-Service// Automated Services// Communities// Co-creation
  40. 40. Customer Relationships Questions// Do you have a customer relationship strategy?// How good are your relationships with your best customers?// Do you spend too much time and money in relationships with unprofitable clients?// How well are you doing in managing your customer relationships (e.g. follow-up, etc.)
  41. 41. Partner Network// Who are your Key Partners?// Who are your Key Suppliers?// Which Key Resources are you acquiring from partners?// Which Key Activities do partners perform?
  42. 42. Partner NetworkMotivations// Optimization and economy// Reduction of risk and uncertainty// Acquisition of particular resources and activities
  43. 43. Partner Network Questions// Do you use partners enough?// How well do you work with your existing partners and suppliers?// How dependent are you on your existing partners and suppliers?
  44. 44. Key Activities// What Key Activities do your Value Propositions require?// Our Distribution Channels?// Customer Relationships?// Revenue Streams?
  45. 45. Key ActivitiesCategories// Production// Problem Solving// Platform/Network
  46. 46. Key Activities Questions// How efficient are you in performing your activities?// Do you perform too many activities ourselves, leading to a lack of focus?
  47. 47. Key Resources// What Key Resources do your Value Propositions require?// Our Distribution Channels?// Customer Relationships?// Revenue Streams?
  48. 48. Key Resources Types// Physical// Intellectual (brand patents, copyrights, data)// Human// Financial
  49. 49. International Trade ©2012 Pearson Education ©2012 Pearson Education
  50. 50. Restrictions to trade // Tariffs // Quotas // Exchange controls // Non-tariff trade barriers ©2012 Pearson Education©2012 Pearson Education
  51. 51. Facilitators of trade// WTO and GATT// Region free trade zones// EU and NAFTA©2012 Pearson Education
  52. 52. Countertrade// Barter// Compensation// Counterpurchase©2012 Pearson Education
  53. 53. Key Resources Questions// Do you dispose of the right key resources in terms of quality and quantity?// Do you dispose off too many resources internally, leading to a lack of focus?
  54. 54. Revenue Streams// For what value are your customers really willing to pay?// For what do they currently pay?// How are they currently paying?// How would they prefer to pay?// How much does each Revenue Stream contribute to overall revenues?
  55. 55. RevenueStreams Types// Asset sale// Usage fee// Subscription Fees// Lending/Renting/Leasing// Licensing// Brokerage fees// Advertising
  56. 56. Revenue Streams PricingFixed pricing// List Price// Product feature dependent// Customer segment dependent// Volume dependentDynamic pricing// Negotiation (bargaining)// Yield Management// Real-time-Market// Auctions
  57. 57. Revenue StreamsQuestions// How sustainable are your current revenue streams?// How diversified are your revenue streams?// Are you dependent on too few revenue sources (e.g. from some big clients or one single business)?// How well do you price your value proposition?
  58. 58. Cost Structure// What are the most important costs inherent in your business model?// Which Key Resources are most expensive?// Which Key Activities are most expensive? Is your business more: // Cost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing) // Value Driven ( focused on value creation, premium value proposition)
  59. 59. Cost StructureCharacteristics// Fixed Costs (salaries, rents, utilities)// Variable costs// Economies of scale// Economies of scope
  60. 60. Cost Structure Questions// Is your cost structure appropriate (e.g. low cost business model = low cost structure)?// Do you clearly understand which parts of your business model have the highest costs?// How lean is your cost structure?
  61. 61. Partner Key Value Customer CustomerNetwork Activities Proposition Relationships Segments Key Distribution High-end Resources Restaurant Channels quality espresso at homeCost structure Revenue streams The Business Model Example // Nespresso Source: Osterwalder & Pigneur: Business Model Generation (2010)
  62. 62. Partner Key Value Customer CustomerNetwork Activities Proposition Relationships Segments Key Distribution Resources ChannelsCost structure Revenue streams The Business Model Example // Charles den Tex (writer)
  63. 63. Partner Key Value Customer CustomerNetwork Activities Proposition Relationships Segments Key Distribution Resources ChannelsCost structure Revenue streams The Business Model Example // YOU!
  64. 64. References// Gulati, R. (2009). Reorganize for Resilience. Boston: Harvard Business School Publishing.// Johnson, G., & Scholes, K. (2002). Exploring corporate strategy. Harlow: Financial Times Prentice Hall.// Moenaert, R., Robben, H., & Gouw, P. (2009). Marketing, strategy & organization (4th ed.). Leuven: LannooCampus.// Osterwalder, A., & Pigneur, Y. (2009). Business Model Generation. Deventer: Kluwer.// ©2012 Pearson Education// Image courtesy of
  65. 65. Contact Details// Website: Email: