entrepreneurial marketing & finance course website: ieor190b/index.htm stacey lawson & ian...
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Entrepreneurial Marketing & FinanceCourse Website: www.ieor.berkeley.edu/~ieor190b/index.htm
Stacey Lawson & Ian Sobieski
225B Bechtel
Office Hours:
M 2:30-3:30
GSI: Wen-Yu Liao
1116 Etcheverry
Office Hours:
W2:30-3:30
What is Entrepreneurship? Entrepreneurship is a management and leadership style that
involves pursuing opportunities without regard to resources currently controlled
Any attempt at new business or new venture creation, such as self-employment, a new business organization, or the expansion of an existing business, by and individual, a team, or an established business.
A way of thinking and acting that is opportunity obsessed, holistic in approach and leadership balanced for the purpose of value creation.
An entrepreneur is a highly creative person who marshals scarce resources to pursue opportunities that bring about large-scale change
References: Harvard Business School and Babson College, London School of Business
Entrepreneurship takes many forms…Entrepreneurship New venture Bootstrapped or
externally financed Organize required
resources to bring to bear
Intrapreneurship New internal project,
division, operating unit, joint venture, etc.
Financial & human resources identified from internal or external sources
My Experience with Entrepreneurship Founder & President of InPart Started and grew PLM software division of
PTC to $300M annual revenue Started new ERM division at Siebel Systems
and grew to $100M annual revenue Acquired 4 companies during various roles Limited Partner in 5 venture capital funds Have been board member, advisor, or
investor in 20+ early stage companies
What is Marketing? “Taking actions to create, grow, maintain or defend markets.”
“Identifying the particular wants and needs of a target market of customers, and then going about satisfying those customers better than the competitors.”
“Process by which a firm creates value for its chosen customers.“
“A group of related business activities aimed at satisfying customer demand for goods and services.”
References: Peter Drucker, Geoffrey Moore, web sources
Entrepreneurial + Marketing
Relentlessly pursuing opportunities without regard to resources currently controlled….
by
…identifying the particular needs of target customers, and then satisfying those customers better than the competition
Biggest Issues VC’s Identify Don’t know how to segment market and position
solution in a compelling way Don’t understand patterns of adoption --
pragmatists won’t buy unless they have to!
Major focus of Entrepreneurial Marketing: Selecting target market and positioning product in
customer’s minds Specifying the plan for marketing activities to achieve
desired customer perception & behavior
Understanding the Customer Who are They?
Personal characteristics Product usage patterns
Why do They Buy? Needs Purchase Motivations
How do They Buy? Decision-making unit
(DMU) Decision-making process
What do They Buy? “Whole” Product or Service Set of product and non-
product capabilities that meet buying objective
Set apart from competition
Where do They Buy? Appropriate channel design
Understanding the Customer
Company Customer
Firm/Manager owns Understanding:• The who, what, where, why, & how of customer behavior• How to translate these into offerings and marketing mix
Customer owns Behavior:• Perception of fit between company’s offerings and their own need• Ability to act
Context
Model for Marketing Decision-Making:5 C’s & 4 P’s
CompanyCore Competencies
CustomerUnmet Needs
CompetitionCompetitive Advantage
CollaboratorsShared Interests
Target Market
Assess the Situation
Context
Model for Marketing Decision-Making:5 C’s & 4 P’s
CompanyCore Competencies
CustomerUnmet Needs
CompetitionCompetitive Advantage
CollaboratorsShared Interests
Target Market
Assess the Situation
• What are our core competencies?• Who has specific, relevant expertise?• Who works in the venture? Advises? Invests?• What is the value of the venture’s offerings?• Who can supply “whole product” expertise?
Context
Model for Marketing Decision-Making:5 C’s & 4 P’s
CompanyCore Competencies
CustomerUnmet Needs
CompetitionCompetitive Advantage
CollaboratorsShared Interests
Target Market
Assess the Situation
• Who are current & potential competitors?• What are their strengths & weaknesses?• What is our differentiation?• How does the value of our offerings compare?
Context
Model for Marketing Decision-Making:5 C’s & 4 P’s
CompanyCore Competencies
CustomerUnmet Needs
CompetitionCompetitive Advantage
CollaboratorsShared Interests
Target Market
Assess the Situation
• What is the macro-economic environment (regulatory, legal, technological, cultural, etc.)?• What changes are taking place in the industry?• What will this market look like long-term?
Context
Model for Marketing Decision-Making:5 C’s & 4 P’s
CompanyCore Competencies
CustomerUnmet Needs
CompetitionCompetitive Advantage
CollaboratorsShared Interests
Target Market
Assess the Situation
• Who are the most important partners?• How should we motivate them?• Who has relationships with our buyer?• What should our channel look like?• Who is best cultural fit?
Context
Model for Marketing Decision-Making:5 C’s & 4 P’s
CompanyCore Competencies
CustomerUnmet Needs
CompetitionCompetitive Advantage
CollaboratorsShared Interests
Target Market
Assess the Situation
• What are the customer’s attributes?• What is the customer’s need/pain?• What is the customer buying process?• Who is involved in the process?• What do they require in a “whole product”?• Where do they wish to buy?
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target MarketSelect TargetMarket
• Customer Segmentation• Competitive Differentiation• Company & Product Positioning
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target MarketSelect TargetMarket
DefineMarketingMix (4P’s)
Product
Price Promotion
Place
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target Market
DefineMarketingMix (4P’s)
Product
Price Promotion
Place• Total package of benefits obtained by the customer• “Whole Product”
Select TargetMarket
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target Market
Product
Price Promotion
Place• Perceived value represents maximum price customer is willing to pay
DefineMarketingMix (4P’s)
Select TargetMarket
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target Market
Product
Price Promotion
Place• Communication with customers to build awareness, knowledge, interest, trial, and repeat purchase
DefineMarketingMix (4P’s)
Select TargetMarket
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target Market
Product
Price Promotion
Place• Channel structure and “go-to-market” approach
DefineMarketingMix (4P’s)
Select TargetMarket
Assess the Situation (5 C’s)
Model for Marketing Decision-Making:5 C’s & 4 P’s
Target MarketSelect TargetMarket
DefineMarketingMix (4P’s)
Product
Price Promotion
Place
Techies“Try it”
VisionariesMove ahead of the herd
PragmatistsStick with the herd
ConservativesMove only when necessary
SkepticsNo way
The Chasm
Product Adoption Lifecycle
Assess the Situation (5 C’s)
Managing It Over Time
Target Market
Product
Price Promotion
Place
Change (Good and Bad news)
Anticipation ResponseExperiments
IterationLearning
Lawson adapted from Lassiter & Sahlman
DefineMarketingMix (4 P’s)
Select TargetMarket
Scope of Marketing Course
Marketing Modules
Module 1 Market Definition, Customer Segmentation & Competition (5C’s, TARGET MARKET)
Module 2 Product Development, Positioning & Pricing (PRODUCT, PRICE)
Module 3 Marketing Communications (PROMOTION)
Module 4 Distribution & Sales Channel Development (PLACE)
Conclusion Putting it All Together
Why Use Case Method?
"We cannot teach people anything; we can only help them discover it within themselves."
~ Galileo Galilei (1564-1642) great Italian astronomer, mathematician, & physicist
Why Use Case Method? Some concepts are best shown through
example Context matters -- what works in one situation
might not work in another You get to be the manager in 20+ companies
this semester Feel the nuance and complexity of the
situation, but boil down to key issue(s) Over time, will help with pattern recognition
Case Preparation
Assignment questions on syllabus/website Opening study question is often, “what should
the protagonist do?” Put yourself in the shoes of the protagonist Prepare until you have an action plan ….and be willing to bet your career on it More learning comes from being wrong, than
being right Note: See “Guide to Cracking Cases”
Class Preparation Expectations Minimum of 2 hrs. preparation for each class
Typically assigned a Case & Note/Reading for each session
Focus on Cases Use whatever time left over to read Notes Notes will provide structures/frameworks to
guide our class discussion
Case Preparation Tactics/StepsSkim the reading/note quickly for new concepts
1. Skim the case quickly
2. Re-read the case carefully
3. Decide what the issues are (case questions)
4. Decide what analysis will inform the issues
5. Complete analysis
6. Choose a course of action/plan
7. Test the plan
Re-read the reading/note if have time
End of Class Sessions
Unlike much of your engineering curriculum, there will not always be a “right” answer
Business is messy, don’t expect a tidy solution
Let the lessons settle in over time Will share outcomes where possible; guest
speakers can offer insights
Grading
40% -- Class Participation and Assignments 20% -- Midterm Group Project & Presentation 20% -- Final Group Project & Presentation 20% -- Final Exam
How will participation be evaluated? 40% of grade based on class attendance &
participation Your participation in critical to the process – requires
good preparation QUALITY + Quantity Provide your viewpoint with supporting facts or
analysis to back it up Very few “right” answers LISTEN to your fellow classmates -- take the
discussion forward, not backward
Group Assignments & Projects Groups of 5 Pick your own groups Pick a concept for a new venture that you
believe could be a viable company OK to use a concept you’ve already been
exploring We’ll take the marketing/sales and finance
portions of plan to the next level
Assignments & Group Projects
Deliverables Date
1 Submit Resume 1/23
2 Concept for New Venture 2/1
3 Product, Positioning Pricing Plan 2/15
4 Communications Plan 2/27
5 Integrated Marketing Plan (incl. Sales & Distribution Plan) 3/8
Marketing Presentations 3/8 & 3/13
6 P&L, Capitalization Table 4/17
7 Balance Sheet 4/24
8 Integrated Financial Plan 5/1
Funding Presentations 5/1 & 5/3
Preparation for Monday Reading for today: Note on Marketing Strategy
Prep for Monday Case: Microfridge Reading: Market Segmentation, Target Market Selection
and Product Positioning Assignment 1 Due: Submit Resume Create a name card and bring to every class Class starts at 4:10 – late-comers not admitted
Accessing HBS Case Materials: http://www.hbsp.com/relay.jhtml?name=cp&c=c93260