class1 marketing game jec 0106

7/25/2019 Class1 Marketing Game Jec 0106

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A Brief History ofMarketing Strategy

James E. ColemanCPA, CFP , PhD


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What this course is about:

Address 3 common expectations ofemployers of recent MBA s A!ility to "or#$mana%e teams A!ility to e&al'ate and sol&e pro!lems A!ility to comm'nicate sol'tions pers'asi&ely

(earn !asic tools and techni)'es foranaly*in% mar#ets + ind'stries

nderstand ho" to apply the mar#etin%strate%y de&elopment process across &ario'ssettin%s


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Marketing Strategy Development Process:The Search for pportunities

!"ternal Market !nvironment

FOUR Ps

FOUR

Cs

(Context)


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Provi#es Marketing StrategyDevelopment Practice

3rd edition


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vervie$

-o' ta#e o&er mar#etin% mana%ement responsi!ilitiesfor yo'r firm.

M'st satisfy c'stomers to sell prod'ct and earn profits

Foc's is on mar#etin% strate%y plannin%.e)'ires inte%ration of all strate%y decisions.e)'ires attention to competiti&e en&ironment.

Considers short term and lon% term perspecti&es.Feat'res on%oin%, rapid feed!ac#.


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The Process

Analysis of mar#et sit'ation$opport'nities

Plannin% and !'d%etin%

Ma#e mar#etin% plan DEC/0/120

0'!mit plan decisions

4he mar#etin% %ame sim'lation

Company reports ret'rned to firms

%e"tDecision

perio#


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&n#ustry !nvironment

Mar#et %ro"th

4raditional P(C applies, !'t s'!sidiary to strate%y

4echnolo%ical en&ironment

2o ma5or inno&ations expected-early re&ision cycle

Competiti&e en&ironment4ype of competition depends on firms decisions


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Si" 'ey Pro#uct(Market Segments

HarriedAssistants

HomeUsers

High-techManagers

ModernStudents Professional

Creators

ConcernedParents

Segments have #ifferent nee#s) preferences)

situations) si*es) gro$th rates+


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Pro#uct -: /oice 0ecognition Device 1/0D2

8eyProd'ctFeat'res

Error Protection (1-10)

Number of Specia Comman!s ("-#0)

$bi it% to Customi&e (1-10)


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03D for Pro#uct Mo#ifications: ,omputing ,osts4eature 1Pro#uct -2 ,ost to Decrease ,ost to &ncrease

0pecial Commands 9:7;< >?,


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Pro#uct .: Digital /ocal ,ommunicator 1D/,2

8eyProd'ctFeat'res

Simi arit% of Comman!s (1-10)

Number of 'as s (1-10)

Ease of earnin* (1-10)

Level 3

ot necessaril' canni$alistic of Product #

$ut additional sales su""ort is needed


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Types of A#vertisingPioneerin%

Best for expandin% mar#et demand early in P(C

Direct competiti&eBest for stim'latin% c'rrent sales 9red'ced carryo&er=

/ndirect competiti&eBest for !'ildin% !rand a"areness + impro&es carryo&er

eminder /mpro&es ad effecti&eness if !rand a"areness is hi%h

Corporate 9/nstit'tional=Creates Hhalo effect for the other prod'ct 9not 'sef'l forsin%le prod'ct sit'ations=


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Marketing 0esponsibilities (Level 3)

. P0 D7,Ts 4eatures 1an# 03D for pro#uct mo#ifications2 P0&,! Wholesale price may #iffer in each channel

an# for each pro#uct

P5A,! Distribution intensity by channel) pro#uct

P0 M T& %(A#vertising 8 Spen#ing for each pro#uct

Type for each pro#uct(Personal selling %umber of sales reps in each channel

Percent non(selling time in each channel

,ommission rate(Sales promotion 8 Spen#ing per channel) pro#uct,7ST M!0 S!0/&,! 8 Spen#ingMA0'!T 0!S!A0,H 9 reports may be purchase#Deman# forecastpro#uction or#er %umber of units for each pro#uct


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Pro#uction !conomies of Scale

nit prod'ction costs "ill decline as c'm'lati&e prod'ctionincreases, !'t this is not reflected in the pro forma estimates


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0esponse 4unctions an# Marketing Spen#ing

0ales

Mar#etin% 0pendin%

4hreshold(e&el

0at'ration(e&el

0pendin% too little may ha&e little effect, !'tspendin% too m'ch 5'st increases costsand red'ces profit.


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Marketing Bu#get &tems (Level 2 and 3)

+D prod'ct modification costs0ales force salaries and se&erance pay

214 commissions 9"hich come o't of profits=

Ad&ertisin% expenseC'stomer ser&ice expense0ales Promotion Expense

Mar#et research reports expenseBUDGET FOR FIRST PERIOD: $98 !

7se it or lose it;


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Discretionary Bu#get

/f yo' o&erspend yo'r re%'lar !'d%et it isa'tomatically ded'cted from this amo'nt.

IWhen it6s gone) it6s gone ./f yo' o&erspend after it s %one, it comes o'tof yo'r ad&ertisin% !'d%et.

nspent money carries to f't're periods andearns interest.

+1,"00,000


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,omputing Prices

,omputing 0etail Prices from Wholesale Prices:!"pecte# 0etail Price < Wholesale price 1-(= Markup2

!"ample: Wholesale price < 8->?,hannel - 0etail Price < 18->? 1-(+?>22 < 8.->

,hannel . 0etail Price < 18->?2 1-(+@?2 < 8- -+?

,omputing Wholesale Prices from Desire# 0etail Prices :

Wholesale Price < 0etail Price C 1- ( = Markup2

!"ample: Desire# 0etail Price < 8- > ,hannel - Wholesale Price < 8- >C1-(+?>2 < 8 ?+>>

,hannel . Wholesale Price < 8- >C1-(+@?2 < 8-.@+?>


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0etail Prices ,harge# 4inal ,onsumers

4he retail price set !y a dealer depends on4he "holesale price in the dealer s channel.

4he c'stomary mar#'p 'sed in the channel.

4he portion of any sales promotion Ideals that thedealer passes alon% to cons'mers as a price

red'ction.


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A EFoo#G Wholesale Price

0ho'ld co&er the 'nit cost of the prod'ct9%i&en its feat'res=.

0ho'ld res'lt in a retail price that "ill appealto tar%et cons'mers.0ho'ld res'lt in a profit mar%in that "illcontri!'te to other expenses and profit.


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,ompetitor Analysis

e&ie" posted reports of ind'stry res'lts. Analy*e past strate%ies + li#ely chan%es.

E&al'ate positionin% and tar%et se%ments.

X

X

X

X

1 2 3 4

4irms

1

23

4

5

6

S e g m e n t s


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&n#ustry Sales 0eport 14ree2

Brand nit 0ales 0hare 9'nits= > 0ales 9retail=Firm ;:, : .;:< > ,;K;,KFirm ; ;:, : .;:< > ,;K;,KFirm 3 ;:, : .;:< > ,;K;,KFirm ;:, : .;:< > ,;K;,KTotal ->>) > 8-9)-9-) ?

Channel nit 0ales Dollars 0ales: ,;K >


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Pro#uct 4eatures an# Prices 0eport 14ree2

Bran#of

/0D

4irm -4irm .4irm @

4irm

Specialcomman#s

!rror protect(

ion

@@@@

!aseof

learning

@@@@

0etailprice

channel -

8- >+>>8- >+>>8- >+>>8- >+>>

0etailprice

channel.

8- +-?8- +-?8- +-?8- +-?


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Market Activity 0eport (F"ee)

A#v+ DollarsA#v+ Type

Sales Promotion ,hannel - ,hannel .

%o+ Sales 0eps ,hannel - ,hannel .,ommission,ustomer Service

4irm -

8.?>)>>>

8>8>

->->?=8 .)?>>

4irm .

8.?>)>>>

8>8>

->->?=8 .)?>>

4irm @

8.?>)>>>

8>8>

->->?=8 .)?>>

4irm

8.?>)>>>

8>8>

->->?=8 .)?>>


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A##itional Market 0esearch 0eports ( NOT F"ee )

. Mar#et share !y se%ment 9all !rands=;. Mar#et share !y channel 9all !rands=

3. Cons'mer preference st'dy. Mar#etin% effecti&eness report

:. 0ales !y se%ment !y channel 9o"n !rand=

. Cons'mer shoppin% ha!its st'dyL. Prod'ct positionin% report

%ote: #e a"ate "e o"t# a"e ava%la&le 'o" ea "od* t+

E, e t 'o" t e on#*-e" # o %n. a&%t# #t*d/


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Market Share by Segment 0eport 18-?)>>>2

Bran#

4irm -

4irm .4irm @4irm

Total

Sales1units2

-

>+.?>

>+.?>>+.?>>+.?>

.>)>.

.

>+.?>

>+.?>>+.?>>+.?>

-?)>

@

>+.?>

>+.?>>+.?>>+.?>

.?)->

>+.?>

>+.?>>+.?>>+.?>

->). >

?

>+.?>

>+.?>>+.?>>+.?>

..)>?

>+.?>

>+.?>>+.?>>+.?>

)> .

Segment

ho s sellin% to "homNho s !'yin% "hatNhat is each firm achie&in%Nhich se%ments are !'yin%N


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Market Share by ,hannel 0eport 18-.)>>>2

Bran#

4irm -

4irm .4irm @4irm

Total Sales1units2

,hannel -

>+.?>

>+.?>>+.?>>+.?>

? ).

hat s sellin% "hereNho s !'yin% "hatN

,hannel .

>+.?>

>+.?>>+.?>>+.?>

)@>


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,onsumer Preference Stu#y 18@>)>>>2

Segment

Stu#entsHomeAssistants,reators

ManagersParents

Special,omman#s

->(-@9(->

->(-@-.(-?

-@(-?(

!rror Protection

.(

.((

.(

(.(

!ase of 5earning

-(@(((

.(9(

Price0ange

lo$lo$highhigh

highlo$

hat #ind of prod'ct "o'ld a se%ment preferNhat reference price seems typical for the se%mentN

Oo" are se%ments similar and differentN


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Marketing !ffectiveness 0eport 18.?)>>> or 8@>)>>> for both pro#+2

Bran# A$areness,ustomer Service ,onsumer Froup 0ating &n#ustry Average 0ating

,hannel -: Sales 0ep Workloa# Dealer Satisfaction ,hannel Strength 1EPushG2

,hannel .: Sales 0ep Workloa# Dealer Satisfaction ,hannel Strength 1EPushG2

&n#e">+??>

->>=->>=

->>=-+>>+?>>

->>=-+>>+?>>

,ompetitors$ith lo$er

&n#e">

>>

>>

,ompetitors$ith eIual or higher &n#e"

@

@@

@@


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Detaile# Sales Analysis 18-?)>>>2

4irm

,hannel -

,hannel .

-

?).

.

-)->

@)@@9

@

?) >.

-)@

-) >

-)-

?

)@ @

-) ?

-)>

-)>9

Segment

nit sales !y se%ment and channel Are yo' reachin% yo'r tar%etN


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,ustomer Shopping Habits 189)>>>2

Segment

Stu#entsHomeAssistants,reators

ManagersParents

Percent of Shoppingin ,hannel -

JJJJJ

J

ho shops "hereNOo" do shoppin% patterns match distri!'tion foc'sN

Percent of Shoppingin ,hannel .

JJJJJJ


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Pro#uct Positioning 0eport 18@>)>>>2

Bran#

4irm -4irm .4irm @4irm

-

JJJJ

.

JJJJ

@

JJJ

J

JJJJ

?

JJJJ

JJJJ

Segment

hich !rands are closest to "hich se%mentsNhich se%ments ha&e no close !randsN


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Submitting Marketing Plans

0'!mittin% mar#etin% plans decisions0'!mit yo'r decision plan files &ia emailno later than the #ue #ate an# time per class calen#ar+

Each firm has a distinct ind'stry and firmidentification 9e.%., A , B3, etc.=

2eed to #eep it strai%ht

Pass"ords and the 4M Plan soft"areemem!er pass"ord 'sed to create Plan

/t is case sensiti&e 9'pper and lo"er case ma#e a difference=Best to stic# to one pass"ord


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0ecommen#ations

Analyze the reports as yo' "o'ld analy*e acase.

Ma#e intentional chan%es.Find a balance in mar#etin% researchspendin%.Be integrative 77thin# caref'lly a!o't ho" eachdecision impacts each of the others.Oa&e some '*n !

class1 marketing game jec 0106

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