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2011.04 Marketing Management
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Transcript of 2011.04 Marketing Management
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Marketing ManagementStephan Langdon, MBA, M.Ed.
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Week 4
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PPT 4-3
Dimensions of a Market Analysis
• Emerging submarkets• Actual and potential market and submarket
size• Market and submarket growth• Market and submarket profitability• Cost structure• Distribution systems• Trends and developments• Key success factors
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Emerging Submarkets
Relevance!
PPT 4-4
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Chapter 4 - Market and Submarket Analysis
PPT 4-5
SUV
Hybrid
Marketing the Wrong Product
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PPT 4-6
Brand PreferenceBrand Relevance
SUV
Determine
Brands to
Consider Mercedes
Select Brand to Buy
Lexus BMW Mercedes
Select Product
Category or Subcategory
Customer Decision Process
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Chapter 4 - Market and Submarket Analysis
PPT 4-7
Questions to Help Structure a Market Analysis
• SubmarketsAre augmented products, emerging niches, trend toward systems, new applications, repositioned product classes, customer trends, or new technologies creating worthwhile submarkets? How should they be defined?
• Size and GrowthPotentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?
Figure 4.1
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Chapter 4 - Market and Submarket Analysis
PPT 4-8
Questions to Help Structure a Market Analysis
• ProfitabilityHow intense is the competition among existing firms? Threats from potential entrants and substitute products? Bargaining power of suppliers and customers? Attractive/profitable markets or submarkets?
• Cost StructureMajor cost and value-added components for various types of competitors?
Figure 4.1
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Chapter 4 - Market and Submarket Analysis
PPT 4-9
Questions to Help Structure a Market Analysis
• Distribution SystemsAlternative channels of distribution? How are they changing?
• Market Trends
• Key Success FactorsKey success factors, assets, and competencies to compete successfully? Can assets and competencies of competitors be neutralized?
Figure 4.1
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Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall
7-10
Characteristics of Business Markets
• Fewer, larger buyers• Close supplier-customer relationships• Professional purchasing• Many buying influences
• Multiple sales calls• Derived demand• Inelastic demand• Fluctuating demand• Geographically concentrated buyers• Direct purchasing
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Buying Situation
Straight rebuy
Modified rebuy
New task
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Systems Buying and Selling
Turnkey solution desired;
Bids solicited
PrimeContractors
Second-tierContractors
System subcomponents
assembled
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The Buying CenterInitiators
Users
Influencers
Deciders
Approvers
Buyers
Gatekeepers
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Sales Strategies
Small Sellers
Large Sellers
Key Buying Influencers
MultilevelIn-depthSelling
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Stages in the Buying Process: Buyphases• Problem recognition• General need description• Product specification• Supplier search• Proposal solicitation• Supplier selection• Order-routine specification• Performance review
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Table 7.2 Buygrid Framework
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Forms of Electronic Marketplaces
• Catalog sites• Vertical markets
• Pure play auction sites• Spot markets
• Private exchanges• Barter markets
• Buying alliances
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Methods of e-Procurement• Websites organized using vertical hubs• Websites organized using functional hubs• Direct extranet links to major suppliers• Buying alliances• Company buying sites
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Table 7.3 Vendor Analysis
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Establishing Corporate Trust and Credibility
Expertise
LikeabilityTrustworthiness
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Factors Affecting Buyer-Supplier Relationships
Availability of alternatives
Supply marketdynamism
Complexity ofsupply
Importance ofsupply
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Categories of Buyer-Seller Relationships
• Basic buying and selling• Bare bones• Contractual transaction• Customer supply
• Cooperative systems• Collaborative• Mutually adaptive• Customer is king
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Chapter 4 - Market and Submarket Analysis
PPT 4-23
Detecting Maturity and Decline
• Price pressure caused by overcapacity and the lack of product differentiation
• Buyer sophistication and knowledge
• Substitute products or technologies
• Saturation
• No growth sources
• Customer disinterest
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A group of organizations (i.e., sellers) offering goods or services that are similar and close substitutes for one another
What’s an industry?
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Is the market vs. industry distinction important?Why or why not?
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Does industry attractiveness matter? Why or why not?
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A Tool for Assessing Industry Attractiveness: Porter’s Five Forces
Rivalry among existing industry
firms
Threat of substitute products
Bargainingpower
of buyers
Bargaining power
of suppliers
Source: Adapted from Michael E. Porter, “Industry Structure and Competitive Strategy: Keys to Profitability,” Financial Analysts Journal, July-August 1980, p. 33.
Threat of new entrants
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Porter: Win - Lose
“ The implicit essence of Porter’s theory is that corporate competitiveness play is a “win by some - lose by some” play, where the firms which are competitively agile will alone sustain themselves and grow. In a sense Porter’s theory reflects modern corporate Darwinism where only the fittest would survive.”
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Sixth Force
Economic Liquidity• The level and
sustainability of economic liquidity in the value chain of a firm constitute an essential competitive force.
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Downes’ Three new Forces
Deregulation:
Globalization:
Digitalization:
• shrinking of government influence• improvements in logistics and communication
• power of IT
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Chapter 4 - Market and Submarket Analysis
PPT 4-31
Competitive Risk
• Overcrowding
• Superior competitive entry
Market Changes
•Changing KSFs
• New technology
• Disappointing growth
• Price instability
Firm Limitations
• Resource constraints
• Distribution unavailable
Figure 4.5
Risks of High-Growth
Market
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Political-Legal Environment
Increase in business legislation
Growth of specialinterest groups
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3-33
MIS Systems Provide Information on Buyer Preferences and Behavior:Dupont’s Pillow Study
Pillow Segments• 23% - stackers• 20% - plumpers• 16% - rollers or folders• 16% - cuddlers• 10% - smashers
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What is a Marketing Information System (MIS)?
A marketing information system consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed,
timely, and accurate information to marketing decision makers.
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Internal Records and Marketing Intelligence
Order-to-PaymentCycle
Databases,Warehousing, Data Mining
MarketingIntelligence
System
Sales Information
System
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The Measures of Market Demand
PotentialMarket
PenetratedMarket
TargetMarket
AvailableMarket
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Figure 4.4 Ninety Types of Demand Measurement
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Figure 4.5 Market Demand Functions
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Figure 4.5 Market Demand Functions
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Table 4.6 Calculating Brand Development Index
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The Conentional Marketing Mix
Product Price
Place/distribution Promotion.
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Plus 4 P’s
Processes,
Productivity
[technology ]
People [employee
s],
Physical evidence