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COEUR - BCM
Business Creativity Module
“Entrepreneurial Marketing Strategy”
Andrew Turnbull
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Entrepreneurial Marketing Strategy
Entrepreneurial Marketing Strategy
– Outline –
1. Introduction:Entrepreneurship, Marketing and Strategy
2. Defining the Offer
3. Defining the Market
4. Timing the Entry Into the Market
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Entrepreneurial Marketing Strategy
1.1) Introduction
What do you think about the following statement?
Every successful entrepreneurhas a detailed master plan
right from the start.
a) Of course, this is true.
b) Generally, yes. More than 2 out of 3 entrepreneurs will have
some sort of documented business plan.
c) Not true. The vast majority of entrepreneurs
only have a vague idea of how things will work out.
d) Not true. An entrepreneur is someone with a great vision,
but totally incapable of organized thinking.
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Entrepreneurial Marketing Strategy
1.1) Introduction
c) Not true. The vast majority of entrepreneursonly have a vague idea of how things will work out.
Answer:
Reasons:
• Rapid change, High uncertainty• Reluctance to commit to one single plan
• Implicit planning emerges over time
(muddling through)
Implications:
• Strategic planning is a process.
• Plan as much as you can, adapt as you proceed.
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Entrepreneurial Marketing Strategy
1.2) Definitions:
Entre-/Europreneurship
Organisational level:
• Creativehuman
capital• Ability to
recognize
opportunities• Willingnessto take risks
Individual level:
• enthusiastic
• committed
• professional
• visionary
• 'hungry„
• open minded
• ...
European
Dimension
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Entrepreneurial Marketing Strategy
1.2) Definitions:
Marketing ...
• … is the management process responsiblefor identifying, anticipating and satisfyingcustomer requirements profitably. (UK)
• … is the discipline of conceiving offersas a function of consumer preferences,and promoting their commercialization.
(France)
• …is market-oriented management.(Germany)
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Entrepreneurial Marketing Strategy
1.2) The Importance
of Marketing: A Tale
New Economy (1995-2001):
Shareholder Value Management
2002 Stock Market Crash
Only those dotcoms survived
that had a sound customer base:
the True Economy .
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Entrepreneurial Marketing Strategy
1.2) Individual Qualities
Comparison
The Entrepreneur… The Marketer…
…is creative, innovative,
open for theunconventional
…tries constantly to stay
abreast of competitors
…is ready to take risks, deal
with uncertainty
…creates or seizes market
opportunities
…works for sustainable
business growth
…works to increase market
share or build better
customer relationships
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Entrepreneurial Marketing Strategy
1.2) Common Misconceptions
about Marketing
Marketing is equivalent
to advertising.
Marketing is just the
icing on the cake.
Marketing is
manipulation.
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Entrepreneurial Marketing Strategy
1.2) Characteristics
of Strategy
Strategy...
• involves making long/medium/short term
plans
• is contingent on top-level goals
• means mission-critical decisions
• provides a frame for individual actions• can result in a planning document
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Entrepreneurial Marketing Strategy
Strategic Balance
1.3) Combining Entrepreneurship
and Marketing Strategy
Entrepreneurial
Challenge:
How best to leverage
limited resources
to help the company
grow?
Marketing
Challenge:
How to find
a profitable and
sustainable
market position?
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Entrepreneurial Marketing Strategy
1.3) Combining Entrepreneurship
and Marketing Strategy
... at different implementation levels:
• Individual: Be a personality, a character and a creative
thinker and salesperson!• Organization:
Grow your company and keep connectedwith the customer!
• Environment: Develop all stakeholder relations and treatcustomers as your most important stakeholders!
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Entrepreneurial Marketing Strategy
Competitors
Customers
1.3) Entrepreneurial Marketing:
Strategic Challenges
• exceed customer expectations
• build trust, keep promises
Internal
• seize opportunities
• change the rules
• balance attack,
defence and evasion
• manage processes
• show leadership
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Entrepreneurial Marketing Strategy
2.1) Defining the Offer:
The Ansoff Matrix
existing new Markets
new
Products existing Penetration
Diversification
Market Development
Product
Development
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Entrepreneurial Marketing Strategy
2.1) Defining the Offer:
SWOT Analysis
favourable unfavourable
Strengths Weak-
nesses Opportu- nities
internal
external
Threats
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Entrepreneurial Marketing Strategy
2.1) Defining the Offer:
PESTLE Analysis
• Political
• Economic
• Social
• Technological
• Legal• Ecological
Environment(s)
Influence on
Business Idea ?
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Entrepreneurial Marketing Strategy
2.2) Defining the Offer:
The Basis For Differentiation
Product Price Promotion Place
Where is their basis
for differentiation ?
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Entrepreneurial Marketing Strategy
2.2) Defining the Offer:
The Basis For Differentiation
Study published by Babson College, Boston, Mass., USA
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Entrepreneurial Marketing Strategy
2.3) “What’s In It For Me?”
Customer Benefit Definition
product
feature
generic
benefit
meaning
to customer
extendedopening hours convenience freedom
customer
loyalty card
savings feeling
market savvyeco-certifiedproducts
goodconscience
leading ameaningful life
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Entrepreneurial Marketing Strategy
2.4) USP — Formulate
a Unique Selling Proposition
• "When it absolutely, positively
has to be there overnight" – FedEx
• "Connecting people" – Nokia
• "Because I'm worth it" - L'Oreal
(“Parce que je le vaux bien”)
• “United Colors of Benetton”
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Entrepreneurial Marketing Strategy
3) Defining the Market
– Marketing Style
Transactional Marketing Relationship Marketing
“make-and-sell” “sense-and-respond”
sales volume maximization customer value maximizationbranding, advertising,
distribution partners
personal selling, direct and
database marketing
packaged goods individual services
one-time customer lifetime customer
high market share stable relationships
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Entrepreneurial Marketing Strategy
3) Defining the Market
– Customer Profiling
Transactional Marketing:
• Who is your typical customer?
Build a demographic portrait:
• Age bracket, cohort
• Family life cycle stage
• Education, occupation
• Disposable income/month
• Usage pattern ...
Relational Marketing:
• How does your typical customer
interact with you?Build a customer life cycle:
• Non-customer
• Prospect, lead
• First timer
• Repeat buyer
• Testimonial
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Entrepreneurial Marketing Strategy
3) Defining the Market
– Market Forecast
Transactional Marketing:
Estimate market size top-down:
• Potential market?
• Available market?
• Target market?
• Penetrated market afterfirst year in business?
Relational Marketing:
Determine minimum marketsize bottom-up
(Break-even analysis):How many customers mustbe addressed to cover costs
of first year in business?
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Entrepreneurial Marketing Strategy
Introduction Growth Maturity Decline
4) Timing the Entry Into the Market
— Product/Market Life Cycle
market
volume
Market Innovator
Product Innovator
time
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Entrepreneurial Marketing Strategy
4) Timing the Entry Into the Market
— Product/Market Life Cycle
Introduction Growth Maturity Decline
New
customers
former non-buyers competitors’ customers
Main
marketing
problem
raising
awareness,
getting
known
making
product
available
differentia-
tion from
competitors
retreat from
market
Main
instruments
Promotion Place Product,
Promotion
Price
Spin on USP Newness Trendiness Distinctness Reliability
How can Marketing Strategy adapt
to different Life Cycle Phases ?
Q:
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Entrepreneurial Marketing Strategy
4) Timing the Entry Into the Market
— First Move Considerations
First Mover Advantages
Primacy effect: Making an early
and lasting effect on customers
Investments into the market (e.g.:
distribution network, consumer
awareness) will pay off early.
First mover can start to build
experience early, increase the lead
and solidify the strategic position
First Mover Disadvantages
Recency effect: Followers have
benefit of newness
Competitors’ free rider effect;
investments may turn out to be
exit barriers if/when market
declines
Competitors may catch up or
outperform first mover if imitation
barriers are low
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Entrepreneurial Marketing Strategy
Finding New IdeasInnovation
Creativity
Harvest ProfitPotential
Economies
of Scale
Positioning
againstCompetitors
Differentiation
Conclusion: The Innovation Cartwheel
Marketing
New IdeasMaking them
acceptable to customers
Entrepreneurial
Marketing Strategy
– a constant interplay
of rulebreaking and
mainstreaming ...