Murray Hunter, profile picture
Uploaded byMurray Hunter
PPT, PDF1,576 views

International Marketing Lecture 5

This document discusses strategies for entering international markets. It outlines various entry strategies such as exporting, using distributors or agents, direct sales, licensing or franchising agreements, strategic alliances, and direct foreign investment. It also discusses generic global marketing strategies such as standardizing products and marketing practices globally versus adapting products or marketing to local markets. Additionally, it examines global product standardization approaches.

Embed presentation

Downloaded 63 times
International Marketing 463-441 Lecture 5 Formation of Market Entry Strategies
Types of Entry Strategies Assessment of Threats and Opportunities Strengths and Weaknesses Product/Market Suitability Assessment of Resources Required to Implement
Degree of Involvement
The Extent of International Involvement Internet Exporter Exporting Greater Control Importer And Greater Distributor Risk Direct Sales Contractual Arrangements Licensing & Franchising Strategic Alliances Strategic Alliances Joint Ventures Ownership Direct Foreign Investment Cateora & Graham P. 323
Generic Global Marketing Strategies Strategic Option Comment 1 Product and marketing practice Using the same strategies everywhere extension 2 Product extension marketing While using the same products everywhere, using adaptation marketing strategies according to local market characteristics 3 Product adaptation marketing While using the same marketing strategies, extension adapting the product offering according to market needs 4 Dual adaptation Adjusting the product and marketing strategies according to market needs 5 Product and market invention Innovating a new product and developing a new marketing strategy for it in each market Keegan, W., Global Marketing Strategies, Prentice Hall, NJ, 1999
Global Product Standardisation Types High (Global Scale) Global Standardisation Modular standardisation Aircraft and multi-brands Microprocessors Elevators Basic Chemicals IT services Pulp and Paper Beer Minimum Size Examples: BASF, Dell, Intel Examples: OTIS, Heineken of Production Process standardisation Local Adaptation Cement Foods Consulting services Examples: Siam Cement Example: McDonalds, Carrefour Low (Local Scale) Similar Different (Local Segments) (Global Segments) Customers’ Needs Around the World
Structure
Distribution and Sales depend on third party Retail Distribution Very costly to undertake own distribution if limited number of products Manufacturer Distributor Retailers Wholesaler
Retail Market Local International Limited by Geographical Locations Supplier Retail Outlet Consumer Own Manufacturing i.e., Bata Shoes Variation: McDonalds, Pizza Hut, KFC Good Profit Margins
Good margins/rely on regular change in Direct Marketing merchandise Direct Manufacturer Marketing Consumer Company Dealer Consumer Low Margin/High Volume Lack Limited by number consistency in of dealers and efforts customers in network Rely on continual motivation and getting new dealers
Direct Marketing Distributor Distribution Export Market Cost 20 Cost 20 Cost 20 Margin % 58.33 Margin % 47.11 Selling 37.82 Margin % 55.50 Price Selling 48 Price Freight, 37.82 Selling 45 Tax, Price Landing A&P 48 12% Dealers & 25% Margin 44 Discounts 65 (SLM) 45% Margin 64 55% 83 (MLM)65% 20% Store 80 Store Price 80 Price Consumer 100 Price Consumer 100 Consumer 100 (128) Price Price • Not including VAT etc.
Product
Benefits and Technologies in Cleaning Clothes Problem Dirty Clothes Hand Automatic local Dry Washing Washer/Dryer Launderette Cleaners Machine Laundry Powders Electrical Technology Washing Powders Solvents Liquid Detergents Fabric Conditioners Benefit Clean Clothes
Fulfillment: (dreams) Actualisation (The Artist) Study after retirement Self-fulfillment Fresh vegetables (Organic) Books Fine Dining & Processed Foods Aromatherapy products Luxury cars Esteem Nutraceuticals & herbs Travel & Vacations (The Executive) Achievement, Fine Fragrances prestige,fulfillment Car Air Fresheners Responsibility: (hope) Fashion Clothes (e.g. Social (Worker) Jeans) Chewing Gum Family, relationships, workgroups Community: (acceptance) Most Water Household Safety (The Farmer) Purifiers Cleaning Home, Security and stability Necessities: based on what is good (existence) Products Fresh Soap Vegetables Physiological (The Hunter) Rice Basic Biological Needs – Food, water, air Staples: based on survival (fear)
Some General Differences Between European and Asian Cultures European Asian Modes of Thinking Causal, functional Network, whole vision Linear, absolutely horizontal Nonlinear, relatively vertical Decision Making To suit controls Based on trust Individual free Group solidarity To suit the majority Reaching Consensus Behaviour True to principals To suit a situation Based on legal principals To suit a community Dynamic, facing conflict Harmonious, conservative Open, Direct, Self confident Restrained, indirect without assurance Extrovert Introvert Purchase Patterns Individualistic Group Influences Opportunistic Systematic Horizontal Vertical communication
Demographics of Odour Communication Objective: to reinforce the belief of the Product consumer in the desired and projected image of the product Differentiation Cleanliness Citrus Lemon Perfumery Marketing Softness Mix Herbal Green Psychological Association Synergy with product presentation: packaging, colour, advertising, corporate image
http://www.brandingstrategyinsider.com/all_of_derricks_posts/index.html
Structure of Attributes for a Fragrance in a Product Fragrance Attributes Signal Features Benefits Attributes Tangible Intangible Base Strength Cover Benefits Benefits Impact Romance Pleasant Performance Odour Fragrance Profile Well-Being Variant Malodour Lasting Counteractant Caring Fragrance Indicator of Use Substantivity Security Offensive Life Status Ingredients Eg essential Odour oils Lifestyle Cover Freshness Association
Product Formulation Ingredients Examples Europe Japan USA Anionic Alkylbenzene 5-10% 5-15% 0-20% Surfactants sulfonates Fatty alcohol sulphanates Olefin sulphanates Non-Ionic Alykyl 3-6% 0-2% 0-17% Surfactants polyethenglygol ethers Nonyphenol polyethyleneglycol ethers Suds control Silicones, parafins 0.1-3.5% 1-3% 0-0.6% agents Foaming Fatty acid 0-2% 0-5% 0-5% Boosters monoethanol amides Ion exchangers Zeolit A, 5-10% 10-20% 0-45% polyacrylic acids Alkalis Sodium carbonate 5-10% 5-20% 10-35% Bleaching Sodium perborate, 20-25% 0-5% 0-5% Agents Sodium percarbonate Bleach Tetraacetyl 0-2% activator ethylenediamine Anti Cellulose ethers 0,5-1.5% 0-2% 0-0.5% disposition agents Enzymes Proteases, 0.3-0.8% 0-0.5% 0-0.5% amylases Optical Stilbene-disulfonic 0.1-0.3% 0.1-0.8% 0.05-0.25% Brighteners acid Anti Corrosion Sodium silicate 2-6% 5-15% 0-25% Agents Fragrance 0.1-0.3% 0.1-0.3% 0.1-0.3%
Where in the Supply chain are you going to enter?
Producers of Chemical Feed Small Holder Forest, Jungle wild Animal Extracts Stock Producers plant Gatherers Manufacturer Research Local Collectors Institutes & Universities Aroma Chemical Manufacturer Producers of Government Essential Oils as By- Plantation Products Producers Producer Specialty/Aroma Trader & Exporter Associations Chemical Manufacturer Broker National FDAs Trader, Importer & Exporter FEMA IFEAT IFRA Agent Flavour and Fragrance RIFM House IOFI Standards Agent Flavour and Fragrance Associations REACH House (subsidiary) SCCP Cosmetic & Household Food & Other Food & Personal Care Product Beverage Non Foods Manufacturer Manufacturer Manufacturer Manufacturer Wholesale Networks Retail Networks Consumers
The Essential Oil Value Chain (Flavour & Fragrance Industry) Flavour & Consumer Essential Trading Fragrance End Oil Compoundi Product Wholesal Retailer Production ng Manufactur er e 1.0 1.6 2-3.0 (6-9) 2-2.5 (18-24) 1.1-1.2 (19.8- 1.2-1.4 28.8) (23.76- Relative and (Absolute) Value Added Through Chain 40.32)
The continuum from media reports to wisdom in relation to availability and usefulness Media Reports The Continuum from media reports to wisdom in relation Availability Increases Ideas to availability and usefulness Data Information Knowledge Wisdom Usefulness Increases
Validity based Risk Environment in Essential Oil on information Development & Judgement Laboratory Field Research Research Market Requirements of an Essential Oil Weather Knowledge and Skills Required Oil Yield, Quality for Evaluation & production/market Viability selection of suitable planting Land materials Suitability Propagation and Planting Costs Assumptions & Patience Market Crop Management Contacts & Plant physiology & Knowledge of Network propagation specific crop protocols management Harvesting & Extraction Costs techniques All factors effect on yield & quality Knowledge of Actual Yields and Oil Quality harvesting, handling & extraction techniques De-stabilising Event – competitor, Volume and Market Acceptance Other unforseen regulation, new external factors – substitute politics, disaster, Economies of scale & correct war, regulation, etc business model, Market strategy
Venture Focus Along Different Parts of the Supply Chain Manufacture of end products. Focus on Consumers formulation and end Consumer product Trends development Important Wholesalers & retailers Vertcal Integration Along the Supply Essential oil as an ingredient in i a product. Focus on uses and applications Technical • Branding research Trends • Theme Manufacturers Important • Consumer Marketing • Reaching Essential oil as • Application primary Product. Mass or Focus Flavour & Fragrance Focus on market selected • Technology Markets Houses demand & supply Focus and meeting • New Product standard • IP Focus (?) Development • Specific Demand & Customer Traders & Brokers Supply, Buying Criteria Important Chain • Technical Primary Producer Focus • General or Niche Customers Agro Industrial Consumer Orientation Orientation Orientation
Supply Chain/Product Focus Usually direct to consumers through internet and/or direct Consumers marketing organisation. Need branded Usually specialised end specialised products with high profit product, high margins volume Usually branded item small depends on packs, end product. Either coverage selective (region or retailer Retailers type), or general Business focus distribution. High value, low towards consumer volume with added marketing away distribution costs. from agricultural This part of supply chain for production smaller packs and end Wholesalers products. Can be local, national or international. Value added method like branding in use. Need differentiated With differentiated product. Above product some flexibility average returns, Manufacturers to sell to higher marketing manufacturers, costs costs higher but increased margin maybe compensate. Need high volume due to Usually bulk oils to traders low margin Trader who do all distribution. unless Lowest price and little specialised control over market, but product wide distribution Bi-products to Other Essential Oil Producer Supply Chains
Cosmetic High Organic production for Cosmetic international Essential Oil production for market Based Agro- international chemical market Market Growth Essential Oil under CO2 extraction Crude Essential Oil Steam Distilled Low Strong Weak Relative Competitive Position
The Outcomes (potential targets) Key internal The process of Key external Size and depth of change influences on the product/market influences on the development development development Time process process The base potential for development Where the business is currently performing
Strengths Weaknesses • Personal and enterprise competencies, • Competency gap knowledge & experience that can be utilised • Short term timeframe, no fall back position for the benefit of the enterprise if positive results delayed or there are • Facilities, infrastructure, financial backing & technical or market failures liquidity, long timeframe view • Poor infrastructure that hinders production • Ability to learn through research and or marketing experimentation • Shortage of funds to undertake project to • Any network connections with industry and completion access to the supply chain for both • Qualified or lack of commitment by any key information and marketing people within organisation • Ambition and vision (but not delusional), • Lack of network, knowledge and access to focus & commitment supply chain • Ability to innovate technically, market and organisational wise Any factor or group of factors that can Any factor or group of factors that can assist the enterprise gain competitive hinder the enterprise gain competitive advantage over its competitors. advantage over its competitors. Opportunities Threats • An identified market where enterprise • Competitors identifying the same resources and competencies will be able to opportunities and enacting upon them exploit • The regulatory environment and potential • The potential opportunity will have a large changes within it enough market size to sustain the enterprise • Inability to penetrate the existing supply • The enterprise will be able to take advantage chain and make alternative strategies of this opportunity better than any other • Dependence on survival from a single or competitors very few customers • Outside elements in the supply chain will • Depending on a single product for total support the enterprise revenue • Adverse acts of God, bad weather, drought, etc. Any factor or group of factors that will Any factor or group of factors that may allow the enterprise to grow in a potentially hinder enterprise growth in a sustainable manner from the market sustainable manner without any environment. contingencies.
Local or International Market Opportunities Local Market International Market Essential Very Limited Unless Much Larger Market Oil Large Domestic Market with Competition Differentiated Limited Unless a Potential Large Market Product Specific Market Exists Dispersed Worldwide Specialty/End Potential with Right Potential with Right Product Products and Correct Products and Correct Distribution and Distribution and Branding Branding Diversification Depend on Location
Market Entry Strategy Typologies
General Competitive Strategies Type Technique Frontal Attack Meeting competitors head on Outflanking Locating competitors weaknesses and attacking them Encirclement Producing more types, sizes, colours, and styles of products at similar or lower prices Bypass Ignoring competitors present markets and technologies and doing something different Guerilla Warfare Using local dealers and distributors to attack certain products, product lines, or channels
Timing of Entry
Potential Product Lifecycle IP Value & Profitability Novelty IP Va lue Competitive Concept Risk Taking Risk Taking it of Pr Pioneers Early Early Late Late followers Majority Followers Time Majority
Trade Offs between Early and Late Entry High First Mover Advantage Low Early Entry Late Entry Cost Advantage Technology Advantage Behavioural Advantage Pre-emptive Advantage Low Information High
Igor Ansoff Corporate Strategy
Ansoff
Red Ocean Verses Blue Ocean Strategy Red Ocean Strategy Blue Ocean Strategy Compete in existing market space Create uncontested market space Beat the competition Make the competition irrelevant Exploit existing demand Create and capture new demand Make the value-cost trade-off Break the value cost trade off Align the whole system of a firm’s activities Align the whole system of a firm’s activities with its strategic choice of differentiation or in pursuit of differentiation and low cost low cost
The Six Principals of Blue Ocean Strategy Risk factor for each principal Formulation Principals Reconstruct market boundaries Lower search risk Focus on the big picture, not the numbers Lower planning risk Reach beyond existing demand Lower scale risk Get the strategic sequence right Lower business model risk Risk factor for each principal Execution Principals Lower organisation risks Lower management risks Overcome key organisational hurdles Build execution into strategy
The Four Actions Framework • Which of the factors that the industry Takes for granted can be eliminated Reduce • Which should be reduced below the Which factors should The industries standard be reduced well • Which should be raised above the below the industry’s Industry’s standard standard? • Which should be created that the Industry has never offered Create Eliminate Which factors should Which factors that A New Value be created that the the industry takes for Curve industry has never granted should be offered? eliminated? Raise Which factors should be raised well above industry’s standards?
From Head to Head Competition to Blue Ocean Strategy Head to head Blue Ocean Strategy Competition Industry Focus on rivals within the industry Looks across alternative industries Strategic Group Focuses on competitive position Looks across strategic groups within within the strategic group industry Buyer group Focuses on maximising the value Redefines the industry buyers group of product and service offerings within the bounds of the industry Scope of product Focuses on maximising the value Looks across complementary product of product and service offerings and service offerings or service offered within the bounds of the industry Functional- Focuses on improving price Rethinks the functional-emotional performance within the functional- orientation of the industry emotional emotional orientation of the orientation industry Time Focuses on adapting to external Participates in shaping external trends trends as they occur over time
The Four Steps in Visualising Strategy 1. Visual 2. Visual 3. Visual Strategy 4. Visual Awakening Exploration Fair Communication • Compare your •Go into the filed to •Draw your “to be” •Distribute your before business with your explore the six paths to strategy canvas based and after strategic competitors by drawing creating blue oceans on insights from field profiles on one page for your “as is” strategy •Observe the distinctive observations easy comparison canvas advantages of •Get feedback on •Support only those •See where your alternative products alternative strategy projects and strategy needs to and services canvases from operational moves that change •See which factors you customers, competitors allow your company to should eliminate, customers and close the gaps to create or change noncustomers actualise the new •Use feedback to build strategy the best “to be” future strategy
Buyer Utility The Blue Ocean Is there exceptional buyer utility in your business idea? Strategy Sequence No rethink Yes Price Is your price easily accessible to the mass of buyers? No rethink Yes Cost Can you attain your cost target to profit your strategic price? No rethink Yes Price What are the adoption Hurdles in actualising your business idea? Are you addressing them up front? No rethink Yes Commercially Viable Blue Ocean Idea
The Buyer Experience Cycle Purchase Delivery Use Supplements Maintenance Disposal How long does it How long does it Does the product Do you need Does the product Does use of the take to find the take to get a require training other products require external product create product you product or expert and services to maintenance? waste items? need? delivered? assistance? make the product work? How easy is it to How easy is it to Is the price of the How difficult is it Is the product upgrade and dispose of the purchase to unpack and easy to store How costly are maintain the product? attractive and install the new when not in use? they? product? accessible? product? Are there any How effective are How much time How costly is legal or Hw secure is the Do buyers have the product’s do they take? maintenance? environmental transaction to arrange features and issues in environment? delivery functions? How much pain disposing of the How rapidly can themselves? If product safely? do they cause? you make a yes, how costly Does the product purchase? and difficult is or service deliver How costly is this? far more power disposal? or options than required by the average consumer? Is it overcharged with bells and whistles?
Guerilla Strategy
Guerilla Marketing Strategy • Levinson identifies the following principles as the foundation of guerrilla marketing: • Guerrilla Marketing is specifically geared for the small business and entrepreneur. • It should be based on human psychology instead of experience, judgment, and guesswork. • Instead of money, the primary investments of marketing should be time, energy, and imagination. • The primary statistic to measure your business is the amount of profits, not sales. • The marketer should also concentrate on how many new relationships are made each month. • Create a standard of excellence with an acute focus instead of trying to diversify by offering too many diverse products and services. • Instead of concentrating on getting new customers, aim for more referrals, more transactions with existing customers, and larger transactions. • Forget about the competition and concentrate more on cooperating with other businesses. • Guerrilla Marketers should always use a combination of marketing methods for a campaign. • Use current technology as a tool to empower your marketing. Source Levinson, Jay Conrad and Goodin, Seth. The Guerrilla Marketing Handbook. Boston: Houghton Mifflin Company, 1994
Guerilla Activity Components Evaluation Questions Feature Evaluation How well is the dealer or distributor known? A company must work with a seasoned dealer or distributor How good is the dealer or distributor for entry? A company must enter a particular target market effectively A company must penetrate the market as deeply How powerful is the dealer or distributor in as possible penetrating the market? Can the dealer or distributor focus on the A company needs a concentrated effort from the dealer or distributor in order to enter the market products and provide the necessary attention? and succeed Can the dealer or distributor change orientation, if necessary, to accommodate unexpected changes The dealer or distributor must be flexible enough to help a company to cope with changes in the in the market? market A company must expect loyalty from the dealer or What level of loyalty can be expected from the distributor – that the dealer or distributor will not dealer or distributor? abandon the partnership
Viral Marketing
• BusinessWeek (2001) described web-based campaigns for Hotmail (1996) and The Blair Witch Project (1999) as striking examples of viral marketing, but warned of some dangers for imitation marketers. • Burger King's The Subservient Chicken campaign was cited in Wired as a striking example of viral or word-of-mouth marketing. • In 2000, Slate described TiVo's unpublicized gambit of giving free TiVo's to web-savvy enthusiasts to create "viral" word of mouth, pointing out that a viral campaign differs from a publicity stunt. • Cadbury's Dairy Milk 2007 Gorilla advert was heavily popularised on YouTube and Facebook. • With the emergence of Web 2.0, mostly all web startups like facebook.com, youtube.com, collabotrade.com, myspace.com, and digg.com have made good use of Viral Marketing by merging it with the social networking. • The release of the 2007 album Year Zero by Nine Inch Nails involved a viral marketing campaign, including the band leaving USB drives at concerts during NIN's 2007 European Tour. This was followed up with a series of interlinked websites revealing clues and information about the dystopian future in which the album is set. • The film Cloverfield initially released one teaser trailer that did not reveal the title--only the release date. The subsequent online viral marketing campaign for the film is remarkably complex, making use of everything from fictitious company websites to MySpace profiles for the film's main characters. • In 2007, World Wrestling Entertainment promoted the return of Chris Jericho with a viral marketing campaign using 15-second cryptic binary code videos. The videos contained hidden messages and biblical links hinting Jericho's return and were shown interrupting WWE broadcasts.[11]
Acquisitions
Acquisition Framework Acquisition Acquisition Acquisition Acquisition Drivers Strategy Pricing Implementation Objectives Bidding Wars Organisation structure External Drivers Reservation Price Culture Negotiation Incentives Political Value Creation Pace Shares/Cash Economic Vertical Integration Regulations Industry Industry consolidation Objectives Technology Excess resources Internal Drivers Strategic Managerial Financial
Successful and Unsuccessful Acquirers Acquisition Integration Issue Successful Acquirer Unsuccessful Acquirer Integration Speed and Uses integration terms to Does not use integration terms. Decision Making integrate rapidly, usually within Merge at slow rates. Layoffs 3 months. Layoffs and other and other decisions deferred. painful measures are undertaken quickly Communication and Vision Communicate the new vision to Does not establish a new vision acquired employees or new roles immediately. immediately with a clear Minimizes communication definition of new roles efforts with acquired firm so not to over burden new employees. Networking and Socialisation Uses networking and Does not over actively network socialisation to discover new or socialise with employees in opportunities in the acquisition. the acquired firm. Who is in charge? Keeps the acquired firm’s senior Keeps all the acquired firm’s managers, but only if they agree senior managers through a with the vision of the acquired variety of fiscal and non-fiscal company post-acquisition incentives Integration Approach Integrates the acquired firm as Adopts a flexible policy to a business unit in its own right, integrate offering each acquired but with a tightly defined company a unique structure as functional role. part of the acquired firm
Michael E. Porter Cluster Analysis, Value Chains & Competitive Strategy
Three Generic Strategies Strategic Advantage Uniqueness Perceived Low Cost Position By Consumer Overall Industrywide Differentiation Cost Strategic Target Leadership Particular Segment Only Focus
What drives a competitor? Competitor Analysis What the competitor is doing Future Goals and can do At all levels of management And in multiple dimensions Current Strategy How the business is currently competing Competitor Response Profile Is the competitor satisfied with its current position? What likely moves or strategy shifts will the competitor take? Where is the competitor vulnerable? What will provoke the greatest and most effective retaliation by the competitor? Assumptions Capabilities Held about itself Both strengths and the industry and weaknesses Porter, Competitive Strategy, P. 49
New Market Entrants, eg: • geographical factors • incumbents resistance • new entrant strategy • routes to market Buyer Power, Competitive Rivalry, Supplier Power, eg: eg: eg: • brand reputation • buyer choice • number and size of • geographical • buyers firms coverage Figure 7. Porter’s Five Forces of Competitive Position size/number • industry size and • product/service level quality • change cost/frequency trends • relationships with • product/service • fixed v variable cost bases customers importance • product/service ranges • bidding • volumes, JIT • differentiation, strategy processes/capabilities scheduling Product/Technolog y Development, eg: • alternatives price/ quality • market distribution changes • fashion and trends • legislative effects
Threat of New Entrants Threat of competition from Porter’s Five Force new technology Analysis for Gernaiol (in past from petrochemicals) Industry Bargaining Power competitiveness Bargaining power of Of suppliers buyers Intensity of rivalry Restrictions on Concentration of The supply of usage into few major beta-pinene compounders The required strengthen buyer feedstock power Other producers of geraniol Adapted from Porter, M. E, Competitive Advantage: Creating and Sustaining Threat of substitutes Superior Performance, New Possible reformulation with York, Free Press, 1985 other rose materials eg. Phenyl ethyl alcohol
Regulation SCCP placed lemongrass oil under scrutiny as a cosmetic Trends & Technology ingredient in EU. Alternative technologies to Trends & Technology steam distillation (CO2) Substitutes can make much smoother Citral (main constituents) can Regulation oil but will increase capital be produced from a number of needs greatly. chemical feed stocks. Natural, exotic, organic, Alternative oils (litsea cubeba) FAIRTRADE could cost much less to produce. increase oils popularity (?) Lemon myrtle oil much if seen as exotic. smoother and acceptable to end users Many alternatives to lemongrass in product formulations. Substitutes Industry Competitors Bargaining Bargaining power of power of buyers suppliers Intensity of Rivalry Competitive Rivalries Bargaining Power of Buyers Currently small item of trade in flavour industry, strong relationships with established producers. Bargaining Power of Suppliers Collecting the most suitable Competitive Rivalries planting material require effort. Lemongrass quick yield and Extraction and straightforward to cultivate and distil harvest .technology needs to be – expect high elasticity of supply acquired or developed from both existing and new Analytical equipment or service producers. maybe expensive/remote. Producers of substitutes very aggressive
Role & Reach of SAIP Role & Reach of SAIP Industry Phase development of SAIP HIGH MARINE III SNP VALUE ADVANTAGE VALUE ADVANTAGE VALUE ADVANTAGE VALUE ADVANTAGE FRUITS FLOWERS I LIVESTOCK II VEGETABLES LOW LOW HIGH PRODUCTIVITY ADVANTAGE Phasing of SAIP in order to ensure a clear focus and fast cluster development! Depending on Logistics Infrastructure Scenario SAIP could provide a wider reach -> Starting with only a 100 km radius to entire Sabah!
The Value Chain

More Related Content

PPT
International Marketing Lecture 3
byMurray Hunter
 
PPT
International Marketing Lecture 4
byMurray Hunter
 
PPT
International Marketing Lecture 6
byMurray Hunter
 
PDF
Huong dan de_tai_tot_nghiep_marketing_manager
byViệt Long Plaza
 
PPT
Intro to mktg_itm_sept-2012_session-2
byNANDA KISHORE SETHURAMAN
 
PPT
Chapter 11 (pricing concept)
byAmaie Idarus
 
PPT
Chapter 6
byAmaie Idarus
 
PPT
Marketingfor managers
byMayuresh Chavan
 
International Marketing Lecture 3
byMurray Hunter
 
International Marketing Lecture 4
byMurray Hunter
 
International Marketing Lecture 6
byMurray Hunter
 
Huong dan de_tai_tot_nghiep_marketing_manager
byViệt Long Plaza
 
Intro to mktg_itm_sept-2012_session-2
byNANDA KISHORE SETHURAMAN
 
Chapter 11 (pricing concept)
byAmaie Idarus
 
Chapter 6
byAmaie Idarus
 
Marketingfor managers
byMayuresh Chavan
 

What's hot

PPT
Competetive advantage
bySumit Rai
 
PPT
International Competitive Advantage
byVarun Jain
 
PDF
MÖBIUS presentation: Value chain thinking at the heart of your strategy
byMÖBIUS
 
PPT
Barney smca4 05
byAnshul Chaudhary
 
PPT
Chap003
byalirazaliaqat
 
PDF
Putting Together a Meaningful Plan Which Sets & Reviews Targets To Confirm De...
bySRMS
 
PPTX
Ppt competitive advantage
byzhouguoqing
 
PPT
Chapter 9
byAmaie Idarus
 
PPT
Chapter 4(my) copy
byAmaie Idarus
 
PPT
Competitive Strategy
byWesley Shu
 
PPT
Competitive strategies
byGeetika Madhur
 
PPT
Mm unit 2 point 1
byRai University
 
PPT
Porter generic strategies pgp1
byPROF. PUTTU GURU PRASAD
 
PPT
Chapter 12 (setting the right price)
byAmaie Idarus
 
PDF
Marketing management-by-philip-kotler-719-slides-1234238345990514-2 untitled9...
byCibin Mathew
 
PDF
Measuring outcomes of brand equity By Leroy J. Ebert
byLeRoy J. Ebert MCIM Chartered Marketer (UK), MBA (AUS)
 
PDF
advertisement
byManu Bhargav
 
DOCX
Course outline brand management v1.0b2
byManish Parihar
 
PDF
Case Study #2
byguest30696ca8
 
DOCX
A new entrant rfid
byAnirban Mazumdar
 
Competetive advantage
bySumit Rai
 
International Competitive Advantage
byVarun Jain
 
MÖBIUS presentation: Value chain thinking at the heart of your strategy
byMÖBIUS
 
Barney smca4 05
byAnshul Chaudhary
 
Chap003
byalirazaliaqat
 
Putting Together a Meaningful Plan Which Sets & Reviews Targets To Confirm De...
bySRMS
 
Ppt competitive advantage
byzhouguoqing
 
Chapter 9
byAmaie Idarus
 
Chapter 4(my) copy
byAmaie Idarus
 
Competitive Strategy
byWesley Shu
 
Competitive strategies
byGeetika Madhur
 
Mm unit 2 point 1
byRai University
 
Porter generic strategies pgp1
byPROF. PUTTU GURU PRASAD
 
Chapter 12 (setting the right price)
byAmaie Idarus
 
Marketing management-by-philip-kotler-719-slides-1234238345990514-2 untitled9...
byCibin Mathew
 
Measuring outcomes of brand equity By Leroy J. Ebert
byLeRoy J. Ebert MCIM Chartered Marketer (UK), MBA (AUS)
 
advertisement
byManu Bhargav
 
Course outline brand management v1.0b2
byManish Parihar
 
Case Study #2
byguest30696ca8
 
A new entrant rfid
byAnirban Mazumdar
 

Viewers also liked

PPTX
Essential oil talk natural grocers
byPatrick Garrett, DC
 
PPTX
Get 100% Pure and Natural Essential Oils at Aroma Essential Oil Store
byAarnav Exports
 
PPT
Selecting and developing new essential oil crops - A framework
byMurray Hunter
 
PPTX
Extraction of Essential oil from Scented Geranium
byRavi Pujari
 
PDF
Patchouli Oil Business Plan
byLena Layla
 
PPTX
Geranium harikanth
byTNAU
 
PDF
Mint ppt
byUAS RAICHUR KARNATAKA
 
PPT
Essential oils presentation
byMurray Hunter
 
PPT
Performance management system
bytsheten
 
Essential oil talk natural grocers
byPatrick Garrett, DC
 
Get 100% Pure and Natural Essential Oils at Aroma Essential Oil Store
byAarnav Exports
 
Selecting and developing new essential oil crops - A framework
byMurray Hunter
 
Extraction of Essential oil from Scented Geranium
byRavi Pujari
 
Patchouli Oil Business Plan
byLena Layla
 
Geranium harikanth
byTNAU
 
Mint ppt
byUAS RAICHUR KARNATAKA
 
Essential oils presentation
byMurray Hunter
 
Performance management system
bytsheten
 

Similar to International Marketing Lecture 5

PPT
Retail Management
byChetan Poojari
 
PPTX
11 strategic planning in retail
byDr. Chandan Vichoray
 
PPT
Mba 618 global strategy 2011
byVignesh S Kumar
 
PPT
International Marketing Lecture 1
byMurray Hunter
 
PPTX
Chapter 3. preliminaries for starting export business
byThane
 
PPT
Marks & spencers retail
byMVIT
 
PPTX
Gbs1 dell mkt development
byBalaji Ramamurthy
 
PDF
Conference Call 3Q09
byJBS RI
 
PPT
E vitaran slides-equity
byPranay Srinivasan
 
PPT
eVitaran-slides-Updated
byPranay Srinivasan
 
PPTX
International Marketing Management, VTU
byGalgotias University
 
PDF
Channel selection
byVasu K Saksena
 
PPTX
Marketing ibm
bychoco421
 
PPSX
Principles of Marketing Ch 10
byGrace de Ramos
 
PDF
International Operations - Ethna Piazza
byAllen Matkins
 
PPTX
Global Sourcing
byguest1999a1
 
PPTX
Global Sourcing Consumables
byNora Gomez (Gates)
 
PPTX
Global Sourcing Consumables
byguest1999a1
 
PPTX
Marketing and Research freelancer
bymohamed ammar
 
PDF
Logistics management 3
byjillmitchell8778
 
Retail Management
byChetan Poojari
 
11 strategic planning in retail
byDr. Chandan Vichoray
 
Mba 618 global strategy 2011
byVignesh S Kumar
 
International Marketing Lecture 1
byMurray Hunter
 
Chapter 3. preliminaries for starting export business
byThane
 
Marks & spencers retail
byMVIT
 
Gbs1 dell mkt development
byBalaji Ramamurthy
 
Conference Call 3Q09
byJBS RI
 
E vitaran slides-equity
byPranay Srinivasan
 
eVitaran-slides-Updated
byPranay Srinivasan
 
International Marketing Management, VTU
byGalgotias University
 
Channel selection
byVasu K Saksena
 
Marketing ibm
bychoco421
 
Principles of Marketing Ch 10
byGrace de Ramos
 
International Operations - Ethna Piazza
byAllen Matkins
 
Global Sourcing
byguest1999a1
 
Global Sourcing Consumables
byNora Gomez (Gates)
 
Global Sourcing Consumables
byguest1999a1
 
Marketing and Research freelancer
bymohamed ammar
 
Logistics management 3
byjillmitchell8778
 

More from Murray Hunter

PDF
Malaysia Deep Corruption Deep State
byMurray Hunter
 
PPTX
Investigative Capacity Building Workshop 3.pptx
byMurray Hunter
 
PDF
Revitalizing manufacturing enterprise in the post-industrial void: A new para...
byMurray Hunter
 
PDF
The rise of local currencies
byMurray Hunter
 
PDF
The New Rules of Running for the Over 50s
byMurray Hunter
 
PDF
The Running Revoltion in Asia
byMurray Hunter
 
PPTX
MBA in ASEAN Busniess Concept
byMurray Hunter
 
PDF
Natural Building as a Community Game
byMurray Hunter
 
DOCX
Idea into startup appraisal form
byMurray Hunter
 
PDF
Dependent origination as a natural governing law
byMurray Hunter
 
PPTX
From idea to start up
byMurray Hunter
 
PDF
Entrepreneurship as a means to create islamic economy
byMurray Hunter
 
PPTX
Entrepreneurship as a means to create islamic economy
byMurray Hunter
 
PPTX
Competitive collaboration in halal industry
byMurray Hunter
 
PPTX
The what, how, why, and where of writing: A personal Reflection
byMurray Hunter
 
PDF
Australia in “Asian Century” or Is It Lost in
byMurray Hunter
 
PDF
An Islam economy can be
byMurray Hunter
 
PDF
ASEAN Nations Need Indigenous Innovation
byMurray Hunter
 
PDF
Missed Opportunities: Inward Focus on Domestic Issues and Parochialism May Le...
byMurray Hunter
 
PDF
From Europe to the US Japan and onto China: The evolution of the automobile i...
byMurray Hunter
 
Malaysia Deep Corruption Deep State
byMurray Hunter
 
Investigative Capacity Building Workshop 3.pptx
byMurray Hunter
 
Revitalizing manufacturing enterprise in the post-industrial void: A new para...
byMurray Hunter
 
The rise of local currencies
byMurray Hunter
 
The New Rules of Running for the Over 50s
byMurray Hunter
 
The Running Revoltion in Asia
byMurray Hunter
 
MBA in ASEAN Busniess Concept
byMurray Hunter
 
Natural Building as a Community Game
byMurray Hunter
 
Idea into startup appraisal form
byMurray Hunter
 
Dependent origination as a natural governing law
byMurray Hunter
 
From idea to start up
byMurray Hunter
 
Entrepreneurship as a means to create islamic economy
byMurray Hunter
 
Entrepreneurship as a means to create islamic economy
byMurray Hunter
 
Competitive collaboration in halal industry
byMurray Hunter
 
The what, how, why, and where of writing: A personal Reflection
byMurray Hunter
 
Australia in “Asian Century” or Is It Lost in
byMurray Hunter
 
An Islam economy can be
byMurray Hunter
 
ASEAN Nations Need Indigenous Innovation
byMurray Hunter
 
Missed Opportunities: Inward Focus on Domestic Issues and Parochialism May Le...
byMurray Hunter
 
From Europe to the US Japan and onto China: The evolution of the automobile i...
byMurray Hunter
 

Recently uploaded

PPTX
West Hatch High School - GCSE Spanish Presentation
byWestHatch
 
PDF
operation with integers and finding common ground worksheet solutions/7th cla...
bySandeep Swamy
 
PPTX
How to Track Employee Skill Growth with Skills Evolution Report in Odoo 18
byCeline George
 
PDF
APPSC APPSC AEE-AE GENERAL STUDIES QUESTION PAPER.pdf
byssuser9d8e4e
 
PPTX
A brief introduction to Minor vegetable crops.pptx
byUmeshTimilsina1
 
PDF
Chapter 05 Drugs Acting on the Central Nervous System: Anticonvulsant (Antiep...
bySandeshSul
 
PPTX
industrial arts grade 6 tle_q4_w3_melc.pptx
byadrianatillaga1
 
PPTX
Modeling Simple Equation using Bar Model.pptx
byshahanieabbat3
 
PDF
Chapter 05 Drugs Acting on the Central Nervous System: Anti-Depressant Drugs
bySandeshSul
 
PPTX
West Hatch High School - GCSE Art Presentation
byWestHatch
 
PDF
West Hatch High School - GCSE Media Specification
byWestHatch
 
PPTX
ENGLISH-7-Quarter-4-Week-3 Matatag .pptx
byKimberlyJadeCuyos
 
PPTX
Biological source, chemical constituents, and therapeutic efficacy of the fol...
bySai Meer College of Pharmacy
 
PPTX
How to Easily Track Appraisal Analysis Report in Odoo 18 Appraisal
byCeline George
 
PPTX
How to Manage Closest Location in Odoo 18 Inventory
byCeline George
 
PDF
Tetracycline Class of Antibiotics: SAR, MOA and Uses
bymominzarinamdnajeeb
 
PPTX
DRYING Pharmaceutical engineering Semester III 2nd year B Pharmacy
byChetana Wagh
 
PPTX
G5_ENGLISH_PPT_Q4_W2.pptx week 2 quarter 4
by96zn2w5tqx
 
PPTX
A detailed notes on Conjugate Vaccine and its mechanism.
byDr. R. Ram
 
PDF
West Hatch High School - GCSE French Specification
byWestHatch
 
West Hatch High School - GCSE Spanish Presentation
byWestHatch
 
operation with integers and finding common ground worksheet solutions/7th cla...
bySandeep Swamy
 
How to Track Employee Skill Growth with Skills Evolution Report in Odoo 18
byCeline George
 
APPSC APPSC AEE-AE GENERAL STUDIES QUESTION PAPER.pdf
byssuser9d8e4e
 
A brief introduction to Minor vegetable crops.pptx
byUmeshTimilsina1
 
Chapter 05 Drugs Acting on the Central Nervous System: Anticonvulsant (Antiep...
bySandeshSul
 
industrial arts grade 6 tle_q4_w3_melc.pptx
byadrianatillaga1
 
Modeling Simple Equation using Bar Model.pptx
byshahanieabbat3
 
Chapter 05 Drugs Acting on the Central Nervous System: Anti-Depressant Drugs
bySandeshSul
 
West Hatch High School - GCSE Art Presentation
byWestHatch
 
West Hatch High School - GCSE Media Specification
byWestHatch
 
ENGLISH-7-Quarter-4-Week-3 Matatag .pptx
byKimberlyJadeCuyos
 
Biological source, chemical constituents, and therapeutic efficacy of the fol...
bySai Meer College of Pharmacy
 
How to Easily Track Appraisal Analysis Report in Odoo 18 Appraisal
byCeline George
 
How to Manage Closest Location in Odoo 18 Inventory
byCeline George
 
Tetracycline Class of Antibiotics: SAR, MOA and Uses
bymominzarinamdnajeeb
 
DRYING Pharmaceutical engineering Semester III 2nd year B Pharmacy
byChetana Wagh
 
G5_ENGLISH_PPT_Q4_W2.pptx week 2 quarter 4
by96zn2w5tqx
 
A detailed notes on Conjugate Vaccine and its mechanism.
byDr. R. Ram
 
West Hatch High School - GCSE French Specification
byWestHatch
 

International Marketing Lecture 5

  • 1.
    International Marketing 463-441 Lecture 5 Formation of Market Entry Strategies
  • 2.
    Types of EntryStrategies Assessment of Threats and Opportunities Strengths and Weaknesses Product/Market Suitability Assessment of Resources Required to Implement
  • 3.
  • 4.
    The Extent ofInternational Involvement Internet Exporter Exporting Greater Control Importer And Greater Distributor Risk Direct Sales Contractual Arrangements Licensing & Franchising Strategic Alliances Strategic Alliances Joint Ventures Ownership Direct Foreign Investment Cateora & Graham P. 323
  • 5.
    Generic Global MarketingStrategies Strategic Option Comment 1 Product and marketing practice Using the same strategies everywhere extension 2 Product extension marketing While using the same products everywhere, using adaptation marketing strategies according to local market characteristics 3 Product adaptation marketing While using the same marketing strategies, extension adapting the product offering according to market needs 4 Dual adaptation Adjusting the product and marketing strategies according to market needs 5 Product and market invention Innovating a new product and developing a new marketing strategy for it in each market Keegan, W., Global Marketing Strategies, Prentice Hall, NJ, 1999
  • 6.
    Global Product StandardisationTypes High (Global Scale) Global Standardisation Modular standardisation Aircraft and multi-brands Microprocessors Elevators Basic Chemicals IT services Pulp and Paper Beer Minimum Size Examples: BASF, Dell, Intel Examples: OTIS, Heineken of Production Process standardisation Local Adaptation Cement Foods Consulting services Examples: Siam Cement Example: McDonalds, Carrefour Low (Local Scale) Similar Different (Local Segments) (Global Segments) Customers’ Needs Around the World
  • 7.
  • 8.
    Distribution and Salesdepend on third party Retail Distribution Very costly to undertake own distribution if limited number of products Manufacturer Distributor Retailers Wholesaler
  • 10.
    Retail Market Local International Limited by Geographical Locations Supplier Retail Outlet Consumer Own Manufacturing i.e., Bata Shoes Variation: McDonalds, Pizza Hut, KFC Good Profit Margins
  • 11.
    Good margins/rely on regular change in Direct Marketing merchandise Direct Manufacturer Marketing Consumer Company Dealer Consumer Low Margin/High Volume Lack Limited by number consistency in of dealers and efforts customers in network Rely on continual motivation and getting new dealers
  • 12.
    Direct Marketing Distributor Distribution Export Market Cost 20 Cost 20 Cost 20 Margin % 58.33 Margin % 47.11 Selling 37.82 Margin % 55.50 Price Selling 48 Price Freight, 37.82 Selling 45 Tax, Price Landing A&P 48 12% Dealers & 25% Margin 44 Discounts 65 (SLM) 45% Margin 64 55% 83 (MLM)65% 20% Store 80 Store Price 80 Price Consumer 100 Price Consumer 100 Consumer 100 (128) Price Price • Not including VAT etc.
  • 13.
  • 14.
    Benefits and Technologiesin Cleaning Clothes Problem Dirty Clothes Hand Automatic local Dry Washing Washer/Dryer Launderette Cleaners Machine Laundry Powders Electrical Technology Washing Powders Solvents Liquid Detergents Fabric Conditioners Benefit Clean Clothes
  • 15.
    Fulfillment: (dreams) Actualisation (The Artist) Study after retirement Self-fulfillment Fresh vegetables (Organic) Books Fine Dining & Processed Foods Aromatherapy products Luxury cars Esteem Nutraceuticals & herbs Travel & Vacations (The Executive) Achievement, Fine Fragrances prestige,fulfillment Car Air Fresheners Responsibility: (hope) Fashion Clothes (e.g. Social (Worker) Jeans) Chewing Gum Family, relationships, workgroups Community: (acceptance) Most Water Household Safety (The Farmer) Purifiers Cleaning Home, Security and stability Necessities: based on what is good (existence) Products Fresh Soap Vegetables Physiological (The Hunter) Rice Basic Biological Needs – Food, water, air Staples: based on survival (fear)
  • 16.
    Some General DifferencesBetween European and Asian Cultures European Asian Modes of Thinking Causal, functional Network, whole vision Linear, absolutely horizontal Nonlinear, relatively vertical Decision Making To suit controls Based on trust Individual free Group solidarity To suit the majority Reaching Consensus Behaviour True to principals To suit a situation Based on legal principals To suit a community Dynamic, facing conflict Harmonious, conservative Open, Direct, Self confident Restrained, indirect without assurance Extrovert Introvert Purchase Patterns Individualistic Group Influences Opportunistic Systematic Horizontal Vertical communication
  • 17.
    Demographics of Odour Communication Objective: to reinforce the belief of the Product consumer in the desired and projected image of the product Differentiation Cleanliness Citrus Lemon Perfumery Marketing Softness Mix Herbal Green Psychological Association Synergy with product presentation: packaging, colour, advertising, corporate image
  • 18.
  • 19.
    Structure of Attributesfor a Fragrance in a Product Fragrance Attributes Signal Features Benefits Attributes Tangible Intangible Base Strength Cover Benefits Benefits Impact Romance Pleasant Performance Odour Fragrance Profile Well-Being Variant Malodour Lasting Counteractant Caring Fragrance Indicator of Use Substantivity Security Offensive Life Status Ingredients Eg essential Odour oils Lifestyle Cover Freshness Association
  • 20.
    Product Formulation Ingredients Examples Europe Japan USA Anionic Alkylbenzene 5-10% 5-15% 0-20% Surfactants sulfonates Fatty alcohol sulphanates Olefin sulphanates Non-Ionic Alykyl 3-6% 0-2% 0-17% Surfactants polyethenglygol ethers Nonyphenol polyethyleneglycol ethers Suds control Silicones, parafins 0.1-3.5% 1-3% 0-0.6% agents Foaming Fatty acid 0-2% 0-5% 0-5% Boosters monoethanol amides Ion exchangers Zeolit A, 5-10% 10-20% 0-45% polyacrylic acids Alkalis Sodium carbonate 5-10% 5-20% 10-35% Bleaching Sodium perborate, 20-25% 0-5% 0-5% Agents Sodium percarbonate Bleach Tetraacetyl 0-2% activator ethylenediamine Anti Cellulose ethers 0,5-1.5% 0-2% 0-0.5% disposition agents Enzymes Proteases, 0.3-0.8% 0-0.5% 0-0.5% amylases Optical Stilbene-disulfonic 0.1-0.3% 0.1-0.8% 0.05-0.25% Brighteners acid Anti Corrosion Sodium silicate 2-6% 5-15% 0-25% Agents Fragrance 0.1-0.3% 0.1-0.3% 0.1-0.3%
  • 21.
    Where in theSupply chain are you going to enter?
  • 22.
    Producers of Chemical Feed Small Holder Forest, Jungle wild Animal Extracts Stock Producers plant Gatherers Manufacturer Research Local Collectors Institutes & Universities Aroma Chemical Manufacturer Producers of Government Essential Oils as By- Plantation Products Producers Producer Specialty/Aroma Trader & Exporter Associations Chemical Manufacturer Broker National FDAs Trader, Importer & Exporter FEMA IFEAT IFRA Agent Flavour and Fragrance RIFM House IOFI Standards Agent Flavour and Fragrance Associations REACH House (subsidiary) SCCP Cosmetic & Household Food & Other Food & Personal Care Product Beverage Non Foods Manufacturer Manufacturer Manufacturer Manufacturer Wholesale Networks Retail Networks Consumers
  • 23.
    The Essential OilValue Chain (Flavour & Fragrance Industry) Flavour & Consumer Essential Trading Fragrance End Oil Compoundi Product Wholesal Retailer Production ng Manufactur er e 1.0 1.6 2-3.0 (6-9) 2-2.5 (18-24) 1.1-1.2 (19.8- 1.2-1.4 28.8) (23.76- Relative and (Absolute) Value Added Through Chain 40.32)
  • 24.
    The continuum frommedia reports to wisdom in relation to availability and usefulness Media Reports The Continuum from media reports to wisdom in relation Availability Increases Ideas to availability and usefulness Data Information Knowledge Wisdom Usefulness Increases
  • 25.
    Validity based Risk Environment in Essential Oil on information Development & Judgement Laboratory Field Research Research Market Requirements of an Essential Oil Weather Knowledge and Skills Required Oil Yield, Quality for Evaluation & production/market Viability selection of suitable planting Land materials Suitability Propagation and Planting Costs Assumptions & Patience Market Crop Management Contacts & Plant physiology & Knowledge of Network propagation specific crop protocols management Harvesting & Extraction Costs techniques All factors effect on yield & quality Knowledge of Actual Yields and Oil Quality harvesting, handling & extraction techniques De-stabilising Event – competitor, Volume and Market Acceptance Other unforseen regulation, new external factors – substitute politics, disaster, Economies of scale & correct war, regulation, etc business model, Market strategy
  • 26.
    Venture Focus AlongDifferent Parts of the Supply Chain Manufacture of end products. Focus on Consumers formulation and end Consumer product Trends development Important Wholesalers & retailers Vertcal Integration Along the Supply Essential oil as an ingredient in i a product. Focus on uses and applications Technical • Branding research Trends • Theme Manufacturers Important • Consumer Marketing • Reaching Essential oil as • Application primary Product. Mass or Focus Flavour & Fragrance Focus on market selected • Technology Markets Houses demand & supply Focus and meeting • New Product standard • IP Focus (?) Development • Specific Demand & Customer Traders & Brokers Supply, Buying Criteria Important Chain • Technical Primary Producer Focus • General or Niche Customers Agro Industrial Consumer Orientation Orientation Orientation
  • 27.
    Supply Chain/Product Focus Usually direct to consumers through internet and/or direct Consumers marketing organisation. Need branded Usually specialised end specialised products with high profit product, high margins volume Usually branded item small depends on packs, end product. Either coverage selective (region or retailer Retailers type), or general Business focus distribution. High value, low towards consumer volume with added marketing away distribution costs. from agricultural This part of supply chain for production smaller packs and end Wholesalers products. Can be local, national or international. Value added method like branding in use. Need differentiated With differentiated product. Above product some flexibility average returns, Manufacturers to sell to higher marketing manufacturers, costs costs higher but increased margin maybe compensate. Need high volume due to Usually bulk oils to traders low margin Trader who do all distribution. unless Lowest price and little specialised control over market, but product wide distribution Bi-products to Other Essential Oil Producer Supply Chains
  • 29.
    Cosmetic High Organic production for Cosmetic international Essential Oil production for market Based Agro- international chemical market Market Growth Essential Oil under CO2 extraction Crude Essential Oil Steam Distilled Low Strong Weak Relative Competitive Position
  • 30.
    The Outcomes (potential targets) Key internal The process of Key external Size and depth of change influences on the product/market influences on the development development development Time process process The base potential for development Where the business is currently performing
  • 31.
    Strengths Weaknesses • Personal and enterprise competencies, • Competency gap knowledge & experience that can be utilised • Short term timeframe, no fall back position for the benefit of the enterprise if positive results delayed or there are • Facilities, infrastructure, financial backing & technical or market failures liquidity, long timeframe view • Poor infrastructure that hinders production • Ability to learn through research and or marketing experimentation • Shortage of funds to undertake project to • Any network connections with industry and completion access to the supply chain for both • Qualified or lack of commitment by any key information and marketing people within organisation • Ambition and vision (but not delusional), • Lack of network, knowledge and access to focus & commitment supply chain • Ability to innovate technically, market and organisational wise Any factor or group of factors that can Any factor or group of factors that can assist the enterprise gain competitive hinder the enterprise gain competitive advantage over its competitors. advantage over its competitors. Opportunities Threats • An identified market where enterprise • Competitors identifying the same resources and competencies will be able to opportunities and enacting upon them exploit • The regulatory environment and potential • The potential opportunity will have a large changes within it enough market size to sustain the enterprise • Inability to penetrate the existing supply • The enterprise will be able to take advantage chain and make alternative strategies of this opportunity better than any other • Dependence on survival from a single or competitors very few customers • Outside elements in the supply chain will • Depending on a single product for total support the enterprise revenue • Adverse acts of God, bad weather, drought, etc. Any factor or group of factors that will Any factor or group of factors that may allow the enterprise to grow in a potentially hinder enterprise growth in a sustainable manner from the market sustainable manner without any environment. contingencies.
  • 32.
    Local or InternationalMarket Opportunities Local Market International Market Essential Very Limited Unless Much Larger Market Oil Large Domestic Market with Competition Differentiated Limited Unless a Potential Large Market Product Specific Market Exists Dispersed Worldwide Specialty/End Potential with Right Potential with Right Product Products and Correct Products and Correct Distribution and Distribution and Branding Branding Diversification Depend on Location
  • 33.
  • 34.
    General Competitive Strategies Type Technique Frontal Attack Meeting competitors head on Outflanking Locating competitors weaknesses and attacking them Encirclement Producing more types, sizes, colours, and styles of products at similar or lower prices Bypass Ignoring competitors present markets and technologies and doing something different Guerilla Warfare Using local dealers and distributors to attack certain products, product lines, or channels
  • 35.
  • 36.
    Potential Product Lifecycle IP Value & Profitability Novelty IP Va lue Competitive Concept Risk Taking Risk Taking it of Pr Pioneers Early Early Late Late followers Majority Followers Time Majority
  • 37.
    Trade Offs betweenEarly and Late Entry High First Mover Advantage Low Early Entry Late Entry Cost Advantage Technology Advantage Behavioural Advantage Pre-emptive Advantage Low Information High
  • 38.
  • 40.
  • 42.
    Red Ocean VersesBlue Ocean Strategy Red Ocean Strategy Blue Ocean Strategy Compete in existing market space Create uncontested market space Beat the competition Make the competition irrelevant Exploit existing demand Create and capture new demand Make the value-cost trade-off Break the value cost trade off Align the whole system of a firm’s activities Align the whole system of a firm’s activities with its strategic choice of differentiation or in pursuit of differentiation and low cost low cost
  • 43.
    The Six Principalsof Blue Ocean Strategy Risk factor for each principal Formulation Principals Reconstruct market boundaries Lower search risk Focus on the big picture, not the numbers Lower planning risk Reach beyond existing demand Lower scale risk Get the strategic sequence right Lower business model risk Risk factor for each principal Execution Principals Lower organisation risks Lower management risks Overcome key organisational hurdles Build execution into strategy
  • 44.
    The Four ActionsFramework • Which of the factors that the industry Takes for granted can be eliminated Reduce • Which should be reduced below the Which factors should The industries standard be reduced well • Which should be raised above the below the industry’s Industry’s standard standard? • Which should be created that the Industry has never offered Create Eliminate Which factors should Which factors that A New Value be created that the the industry takes for Curve industry has never granted should be offered? eliminated? Raise Which factors should be raised well above industry’s standards?
  • 45.
    From Head toHead Competition to Blue Ocean Strategy Head to head Blue Ocean Strategy Competition Industry Focus on rivals within the industry Looks across alternative industries Strategic Group Focuses on competitive position Looks across strategic groups within within the strategic group industry Buyer group Focuses on maximising the value Redefines the industry buyers group of product and service offerings within the bounds of the industry Scope of product Focuses on maximising the value Looks across complementary product of product and service offerings and service offerings or service offered within the bounds of the industry Functional- Focuses on improving price Rethinks the functional-emotional performance within the functional- orientation of the industry emotional emotional orientation of the orientation industry Time Focuses on adapting to external Participates in shaping external trends trends as they occur over time
  • 46.
    The Four Stepsin Visualising Strategy 1. Visual 2. Visual 3. Visual Strategy 4. Visual Awakening Exploration Fair Communication • Compare your •Go into the filed to •Draw your “to be” •Distribute your before business with your explore the six paths to strategy canvas based and after strategic competitors by drawing creating blue oceans on insights from field profiles on one page for your “as is” strategy •Observe the distinctive observations easy comparison canvas advantages of •Get feedback on •Support only those •See where your alternative products alternative strategy projects and strategy needs to and services canvases from operational moves that change •See which factors you customers, competitors allow your company to should eliminate, customers and close the gaps to create or change noncustomers actualise the new •Use feedback to build strategy the best “to be” future strategy
  • 47.
    Buyer Utility The BlueOcean Is there exceptional buyer utility in your business idea? Strategy Sequence No rethink Yes Price Is your price easily accessible to the mass of buyers? No rethink Yes Cost Can you attain your cost target to profit your strategic price? No rethink Yes Price What are the adoption Hurdles in actualising your business idea? Are you addressing them up front? No rethink Yes Commercially Viable Blue Ocean Idea
  • 48.
    The Buyer ExperienceCycle Purchase Delivery Use Supplements Maintenance Disposal How long does it How long does it Does the product Do you need Does the product Does use of the take to find the take to get a require training other products require external product create product you product or expert and services to maintenance? waste items? need? delivered? assistance? make the product work? How easy is it to How easy is it to Is the price of the How difficult is it Is the product upgrade and dispose of the purchase to unpack and easy to store How costly are maintain the product? attractive and install the new when not in use? they? product? accessible? product? Are there any How effective are How much time How costly is legal or Hw secure is the Do buyers have the product’s do they take? maintenance? environmental transaction to arrange features and issues in environment? delivery functions? How much pain disposing of the How rapidly can themselves? If product safely? do they cause? you make a yes, how costly Does the product purchase? and difficult is or service deliver How costly is this? far more power disposal? or options than required by the average consumer? Is it overcharged with bells and whistles?
  • 49.
  • 50.
    Guerilla Marketing Strategy • Levinson identifies the following principles as the foundation of guerrilla marketing: • Guerrilla Marketing is specifically geared for the small business and entrepreneur. • It should be based on human psychology instead of experience, judgment, and guesswork. • Instead of money, the primary investments of marketing should be time, energy, and imagination. • The primary statistic to measure your business is the amount of profits, not sales. • The marketer should also concentrate on how many new relationships are made each month. • Create a standard of excellence with an acute focus instead of trying to diversify by offering too many diverse products and services. • Instead of concentrating on getting new customers, aim for more referrals, more transactions with existing customers, and larger transactions. • Forget about the competition and concentrate more on cooperating with other businesses. • Guerrilla Marketers should always use a combination of marketing methods for a campaign. • Use current technology as a tool to empower your marketing. Source Levinson, Jay Conrad and Goodin, Seth. The Guerrilla Marketing Handbook. Boston: Houghton Mifflin Company, 1994
  • 51.
    Guerilla Activity ComponentsEvaluation Questions Feature Evaluation How well is the dealer or distributor known? A company must work with a seasoned dealer or distributor How good is the dealer or distributor for entry? A company must enter a particular target market effectively A company must penetrate the market as deeply How powerful is the dealer or distributor in as possible penetrating the market? Can the dealer or distributor focus on the A company needs a concentrated effort from the dealer or distributor in order to enter the market products and provide the necessary attention? and succeed Can the dealer or distributor change orientation, if necessary, to accommodate unexpected changes The dealer or distributor must be flexible enough to help a company to cope with changes in the in the market? market A company must expect loyalty from the dealer or What level of loyalty can be expected from the distributor – that the dealer or distributor will not dealer or distributor? abandon the partnership
  • 52.
  • 54.
    • BusinessWeek (2001) described web-based campaigns for Hotmail (1996) and The Blair Witch Project (1999) as striking examples of viral marketing, but warned of some dangers for imitation marketers. • Burger King's The Subservient Chicken campaign was cited in Wired as a striking example of viral or word-of-mouth marketing. • In 2000, Slate described TiVo's unpublicized gambit of giving free TiVo's to web-savvy enthusiasts to create "viral" word of mouth, pointing out that a viral campaign differs from a publicity stunt. • Cadbury's Dairy Milk 2007 Gorilla advert was heavily popularised on YouTube and Facebook. • With the emergence of Web 2.0, mostly all web startups like facebook.com, youtube.com, collabotrade.com, myspace.com, and digg.com have made good use of Viral Marketing by merging it with the social networking. • The release of the 2007 album Year Zero by Nine Inch Nails involved a viral marketing campaign, including the band leaving USB drives at concerts during NIN's 2007 European Tour. This was followed up with a series of interlinked websites revealing clues and information about the dystopian future in which the album is set. • The film Cloverfield initially released one teaser trailer that did not reveal the title--only the release date. The subsequent online viral marketing campaign for the film is remarkably complex, making use of everything from fictitious company websites to MySpace profiles for the film's main characters. • In 2007, World Wrestling Entertainment promoted the return of Chris Jericho with a viral marketing campaign using 15-second cryptic binary code videos. The videos contained hidden messages and biblical links hinting Jericho's return and were shown interrupting WWE broadcasts.[11]
  • 55.
  • 56.
    Acquisition Framework Acquisition Acquisition Acquisition Acquisition Drivers Strategy Pricing Implementation Objectives Bidding Wars Organisation structure External Drivers Reservation Price Culture Negotiation Incentives Political Value Creation Pace Shares/Cash Economic Vertical Integration Regulations Industry Industry consolidation Objectives Technology Excess resources Internal Drivers Strategic Managerial Financial
  • 57.
    Successful and UnsuccessfulAcquirers Acquisition Integration Issue Successful Acquirer Unsuccessful Acquirer Integration Speed and Uses integration terms to Does not use integration terms. Decision Making integrate rapidly, usually within Merge at slow rates. Layoffs 3 months. Layoffs and other and other decisions deferred. painful measures are undertaken quickly Communication and Vision Communicate the new vision to Does not establish a new vision acquired employees or new roles immediately. immediately with a clear Minimizes communication definition of new roles efforts with acquired firm so not to over burden new employees. Networking and Socialisation Uses networking and Does not over actively network socialisation to discover new or socialise with employees in opportunities in the acquisition. the acquired firm. Who is in charge? Keeps the acquired firm’s senior Keeps all the acquired firm’s managers, but only if they agree senior managers through a with the vision of the acquired variety of fiscal and non-fiscal company post-acquisition incentives Integration Approach Integrates the acquired firm as Adopts a flexible policy to a business unit in its own right, integrate offering each acquired but with a tightly defined company a unique structure as functional role. part of the acquired firm
  • 58.
    Michael E. Porter ClusterAnalysis, Value Chains & Competitive Strategy
  • 59.
    Three Generic Strategies Strategic Advantage Uniqueness Perceived Low Cost Position By Consumer Overall Industrywide Differentiation Cost Strategic Target Leadership Particular Segment Only Focus
  • 60.
    What drives acompetitor? Competitor Analysis What the competitor is doing Future Goals and can do At all levels of management And in multiple dimensions Current Strategy How the business is currently competing Competitor Response Profile Is the competitor satisfied with its current position? What likely moves or strategy shifts will the competitor take? Where is the competitor vulnerable? What will provoke the greatest and most effective retaliation by the competitor? Assumptions Capabilities Held about itself Both strengths and the industry and weaknesses Porter, Competitive Strategy, P. 49
  • 61.
    New Market Entrants, eg: • geographical factors • incumbents resistance • new entrant strategy • routes to market Buyer Power, Competitive Rivalry, Supplier Power, eg: eg: eg: • brand reputation • buyer choice • number and size of • geographical • buyers firms coverage Figure 7. Porter’s Five Forces of Competitive Position size/number • industry size and • product/service level quality • change cost/frequency trends • relationships with • product/service • fixed v variable cost bases customers importance • product/service ranges • bidding • volumes, JIT • differentiation, strategy processes/capabilities scheduling Product/Technolog y Development, eg: • alternatives price/ quality • market distribution changes • fashion and trends • legislative effects
  • 62.
    Threat of NewEntrants Threat of competition from Porter’s Five Force new technology Analysis for Gernaiol (in past from petrochemicals) Industry Bargaining Power competitiveness Bargaining power of Of suppliers buyers Intensity of rivalry Restrictions on Concentration of The supply of usage into few major beta-pinene compounders The required strengthen buyer feedstock power Other producers of geraniol Adapted from Porter, M. E, Competitive Advantage: Creating and Sustaining Threat of substitutes Superior Performance, New Possible reformulation with York, Free Press, 1985 other rose materials eg. Phenyl ethyl alcohol
  • 63.
    Regulation SCCP placed lemongrass oil under scrutiny as a cosmetic Trends & Technology ingredient in EU. Alternative technologies to Trends & Technology steam distillation (CO2) Substitutes can make much smoother Citral (main constituents) can Regulation oil but will increase capital be produced from a number of needs greatly. chemical feed stocks. Natural, exotic, organic, Alternative oils (litsea cubeba) FAIRTRADE could cost much less to produce. increase oils popularity (?) Lemon myrtle oil much if seen as exotic. smoother and acceptable to end users Many alternatives to lemongrass in product formulations. Substitutes Industry Competitors Bargaining Bargaining power of power of buyers suppliers Intensity of Rivalry Competitive Rivalries Bargaining Power of Buyers Currently small item of trade in flavour industry, strong relationships with established producers. Bargaining Power of Suppliers Collecting the most suitable Competitive Rivalries planting material require effort. Lemongrass quick yield and Extraction and straightforward to cultivate and distil harvest .technology needs to be – expect high elasticity of supply acquired or developed from both existing and new Analytical equipment or service producers. maybe expensive/remote. Producers of substitutes very aggressive
  • 64.
    Role & Reachof SAIP Role & Reach of SAIP Industry Phase development of SAIP HIGH MARINE III SNP VALUE ADVANTAGE VALUE ADVANTAGE VALUE ADVANTAGE VALUE ADVANTAGE FRUITS FLOWERS I LIVESTOCK II VEGETABLES LOW LOW HIGH PRODUCTIVITY ADVANTAGE Phasing of SAIP in order to ensure a clear focus and fast cluster development! Depending on Logistics Infrastructure Scenario SAIP could provide a wider reach -> Starting with only a 100 km radius to entire Sabah!
  • 65.

Editor's Notes