chapter #10. johnson controls incinc batteries, seats for autos heating and cooling for schools...
TRANSCRIPT
Johnson Controls Inc
• Batteries, seats for autos
• Heating and cooling for schools
• Acquired weaker companies
• Global markets
• Good relations with GM, Ford, DaimlerChrysler, BMW & Toyota
• Market intelligence
• Mature Markets– Maintaining Market share
• Adidas, Johnson’s baby shampoo, Arm & Hammer
• Declining Markets– Divest or liquidate, consolidate, harvest
• The shake out– Appearance of excess capacity– Difficult to maintain product differentiation– Intensifying of competition– Pressures on costs and profits– Weaker member fail or are acquired
Strategic traps during transition
• Failure to anticipate transition from growth to maturity– Overcapacity – Replacement sales outweigh first-time
purchases
• No clear competitive advantage as growth slows– Getting stuck in the middle
• Assumption that an early advantage will insulate the firm from price or service competition– Price versus quality (HP vs Dell)
• Sacrificing market share in favor of short-run profit– Not investing in R&D or marketing
Strategic choices for mature markets
• Business strategy to sustain a competitive advantage, customer satisfaction and loyalty
• Flexible and creative marketing programs to pursue new opportunities as conditions change
• Analyzer– Works best in industries that still experiencing
some technological change• Defender
– Industries where basic technology is not very complex
• Operational excellence• Product leadership• Customer intimacy• Don’t get stuck in the middle• Can you purse both a low cost and a differentiator
strategy at the same time?• Quality might be the key six sigma
Low-Cost Position
• No frills Product
• Innovative product design
• Cheaper Raw materials
• Innovative production Processes
• Low-cost distribution
• Reductions in Overhead
• Measuring customer satisfaction
• Improving customer retention and loyalty– Loyal customers
• Concentrate their purchases
• Are all customer equally valuable– Fidelity Investments ($13 vs less than $1)– Redlining– Profiles change
Extending volume growth
Increased penetration– # of potential customers – Product penetration of that segment– Average frequency of use
Why are non user uninterested in your product?
Convert current nonusers in target segment into users