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Marketing
- 1. Developing Marketing Strategies and Plan GROUP A
- 2. Chapter 2: Developing Marketing Strategies and Plans Topics included: •Marketing •Customer Value •The Value Delivery Process •The Value Chain • Core Competencies
- 3. Marketing Identifying and meeting human and social needs profitably.
- 4. Customer value = Benefits - Cost
- 5. The Value Delivery Process 1. Assessing marketing opportunities and customer value 2. Choosing the value 3. Designing value 4. Delivering value 6. Growth and sustainability of the value 5. Communicating the value
- 6. The Value Chain A tool for identifying ways to create more customer value. Primary Activities Support Activities1. Inbound Logistics 2. Operations 5. Service 2. Technology Development 3. Human Resource Management 3. Outbound Logistics 4. Marketing 4. Firm Infrastructure 1. Procurement
- 7. Core Competencies • Unique strengths and competitive advantage of business. • Term “core competency” originated in a 1990 Harvard Business Review article, introduced by, C. K. Prahalad and Gary Hamel. • In this article, the authors suggest that business functions not enhanced by core competencies should be outsourced if economically feasible.
- 8. How to know if it is core competency or not? Source of competitive advantage Significant contribution to perceived customer benefits Hard for competitors to copy or develop Applications in a variety of markets
- 9. Distinctive competencies and Core competencies Uniqueness is one of the prime concerns of distinctive competencies. Core competency relates to anything that is central to the core of the business. Distinctive competency is a quality that differentiates a company from its competitors. A core competency can also be a distinctive competency only if a core competency facilitates competitive advantage.
- 10. Importance of Core Competency in an Organization Facilitates Strategy Development Encourages innovation Enforces recruitment and selection process Stability of business
Editor's Notes
- For a customer: Purchase For a company: Profit For an investor: Return on Investment For a salesman: Persuasion For an economist: Right placement For a manager: Target For a country: Trade For an analyst: Evaluation of the value For a layman: Branding So, marketing is not only the art of selling products. According to Peter Drucker, a leading mgmt theorist, “The aim of marketing is to know and understand the customer so well that a product or service fits him/her and sells itself. “ Communicating the value of your product or service is a key aspect of marketing.
- Customer value can be examined at different levels. At a low level, customer value can be viewed as the attributes of a product that a customer perceives to receive value from. At a higher level, customer value can be viewed as the emotional payoff and achievement of a goal or desire. When customers derive value from a product, they derive value from the attributes of the product as well as from the attribute performance and the consequence of achieving desired goals from the use of the product (Woodruff, 1997). The difference between what a customer gets from a product, and what he/she has to give in order to get it tangible or intangible or both. Every consumer has a unique set of needs and resources, so no two consumers will place the same customer value on the same product or service. Therefore, in an economy where the buyers are faced with abundant choices, a company can win only by applying the effective value delivery process
- Strategic Management Approach Differentiate a customer oriented organisation form the traditional brand making and selling. An entrepreneurial firm must deliver value along the dimensions that matter most to its customers. For example, from a customer's perspective, the value of a cup of coffee enjoyed with a friend at a coffee shop might be greater than the value of a take-out cup of coffee. While the monetary cost of the cup of coffee in both cases might be the same, the value the customer extracts is different. Point 2: people have now realized that the marketing not just takes place in selling but a smart manager designs and delivers the products for well defined target markets. Now, a businessperson always places marketing at the beginning of a planning and see themselves as a part of value creation and delivery process. Firms must continuously strive to better understand and anticipate what their customers will value and then keep delivering it. As Steve Jobs once said: “You can't just ask customers what they want and then try to give that to them. By the time you get it built, they'll want something new.”
- 1. The Value Chain -Harvard’s Michael Porter has proposed the value chain as a tool for identifying ways to create more customer value. -According to this model, every firm is a synthesis of activities performed to design, produce, market, deliver and support its product. -The value chain identifies nine strategically relevant activities, five primary and four support activities that create value and cost in a specific business. -The primary activities are (1) inbound logistics, or bringing materials into the business; (2) operations, or converting materials into final products; (3) outbound logistics, or shipping out final products; (4) marketing, which includes sales; and (5) service. -Specialized departments handle the support activities, which are (1) procurement, (2) technology development, (3) human resource management, and (4) firm infrastructure. (Infrastructure covers the costs of general management, planning, finance, accounting, legal, and government affairs.)
- For example, one of Apple’s core competencies has been its ability to produce cutting edge and “cool” designs. Dell’s core competencies is to target high-value and low-maintenance customers using database technologies.
- Example: Holding unique manufacturing process of automobiles, by Rolls-Royce is a distinctive competency.