1 strategy and marketing in the laboratory products industry stephen drozdow

1

Strategy and Marketing in the Laboratory Products Industry

Stephen Drozdow

2Strategy and Marketing in the Laboratory Products IndustryApril 23, 2006

Thank you for showing up!


Welcome to my presentation


Presentation Content

• This presentation addresses the linkage between a business’ marketing plan and how the marketing plan is the basis for everything that the business does


Premise

• Unless a business has a clearly defined and well-communicated overall strategy, efforts will quickly become tactical in nature -– the business’ customers and employees will

often-times be confused by changing and sometimes conflicting messages and activities.


Presentation Content

• This presentation will -– summarize the strategy development process

at Alcan - Pharmaceutical Packaging and Wheaton Science Products.

• how Wheaton’s marketing strategy supports Wheaton’s overall strategy

• how internal resources are aligned and allocated and how performance is measured.


Topics will include:

• What marketing and merchandising strategies are working in the laboratory and scientific research markets

• what trends are on the horizon• how a regional distributor might position

themselves to successfully compete


Your Business Model

• The only thing that matters: Sustainable Profitability

• The companies that win:– Display the discipline and focus necessary to

establish a distinctive competitive position and then stick with it but are responsive to market and competitive shifts

– Exercise the discipline of execution

• To execute you need a business and marketing plan


A Marketing Plan vs. a Business Plan

• How Can You Distinguish Between the Two?• Business Plan-

– Addresses all the functions and strategies for the entire company

• Marketing Plan– The framework for bringing in revenues both short and

longer-term

• Both are your perception of how your markets drive the performance of your company

• So, you had better be correct in your assumptions!


Operating Strategy

• There are two elements of the business strategy -

• The first is to get everyone headed in the same direction with a common, shared purpose

• The second is to integrate the resources and systems of the organization to achieve that purpose


What’s Easy?

• Answering the phone• Responding to a competitive price• Fire-fighting• In other words -

Immediate Gratification


What’s Hard and Takes Discipline?

• Thinking• Planning• Writing• Letting others critique your work• In other words -

Strategy


Essential Elements for Growth

• Strategy• Customers• People• Processes


Alignment

• Carefully crafting and articulating the business’ operating and strategic agendas

• Defining the few critical strategic and operational goals to will determine your success

• Deploying resources throughout the organization• Establishing performance metrics• Linking rewards to accomplishment of the

metrics’ targets• Reviewing people’s performance regularly


Clarity and Consistency

• Make your intentions and goals perfectly clear

• Maintain a consistent posture about not changing your guiding principles to the point where you seem to be a broken record


Well done is better than well said.

• Ben Franklin


Metrics

• What gets measured gets our attention• Understand your business performance

drivers• Be relentless about continuous

improvement


• Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.

Marketing: Textbook Definition


Marketing: Textbook Definition

• The process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to satisfy customers.


Marketing: A Practical Definition

• Finding out what customers want, then setting out to meet their needs, provided it can be done at a profit. Marketing includes market research, deciding on products and prices, advertising, promoting, distributing and selling.


The Marketing PlanAnalysis

MarketFuture

ScenariosCustomerCompanyCompetition

Strengths ThreatsOpportunitiesWeaknesses

Key Success Statements

Clarify

Objectives

Create

Convey

Delivery


The Importance of the Marketing Plan

FACT BOOKMARKETING STRATEGY

HOW THE BUSINESS MUST

OPERATE IN ORDER TO

MAXIMIZE THE VALUE OF THE

MARKETING STRATEGY

OVERALL BUSINESS

PLAN

OPERATING AGENDASTRATEGIC AGENDA

ENTERPRISE AGENDA

METRICS OF PERFORMANCE

ConclusionsInferences

Alternatives

Changes in Strategies

and Tactics


How A Distributor Can Market Themselves Using The Strategy of a Larger Vendor

What Motivates A Distributor

– Revenue and profit growth

– Access to opportunities the Vendor’s sales force

may uncover – A differentiated offering

which a competitor cannot easily displace

– Communications and trust

What Motivates A Vendor

– Revenue and profit growth

– A superior position to their competitors in Sales,

catalogs, etc

– Not moving business from them to another vendor

– Communications and trust


Assessment of DistributorsNational Distributors

Strengths–Purchasing (cost) advantage–Formal policies, procedures and infrastructures

Weaknesses–Impersonal–Conformance to policy–Slow response

Opportunities–Can consolidate all business at an account–Can marshall a lot of resources on a specific target

Threats–Field turnover

–Customer backlash against their size and “remoteness”

–Losing the service battle


Assessment of DistributorsRegional Distributors

Strengths– Local to the community– Non threatening source– Service responsiveness

Weaknesses– “Seat of the pants” marketing and selling– Lack of process discipline– Lack of training

Opportunities– Disorganization and loss of focus at the national distributors– Speed of response

Threats– Customer consolidation of suppliers

– Not achieving the minimum purchase requirements of their vendors


Marketing Strategy

• You market four things:– Products– Services– Know How– Your Image


Product Strategy

• Depth versus Breadth• Product bundling• Pricing and profitability


Service Strategy

• Delivery• Invoicing• Communications• Order placement• Minimum order levels


Customer Loyalty

• When you’re speaking with a customer, who is the most important person in the world?

• “The Customer” you all say• Really? If you and the customer were stranded

on an island and had food for only one person, who would you want to see fed?

• Now that we have established that YOU are the most important person, how do we deal with a customer who believes that THEY are the most important person?


These Days Customers Are:

• Smarter• Leaner• Price conscious• Lower morale (downsized)• Hit on by more competitors• More demanding• Less forgiving


What Would Customers Like?

• Communication• Attitude• Reliability• Tangibility• Assurance• Empathy• Exceptional Service


Choices

• Every time a customer calls-• You have an opportunity and a choice• What choice are you making?• Are you creating frequent, lasting

memorable impressions?

If so, name one


Are Your Marketing Pillars Solid?Inferior Marketers… Superior Marketers…

Gather products, stack them on shelves, put price tags on them, and wonder where their customers are.

Consider what people really need and how can meet that particular need better than competitors can.

Are staffed by people who don’t know what customers want are aren’t not about to interrupt their conversations to find out.

Actually train and manage salespeople they hire so that they are courteous, energetic, and helpful to customers.

Acts as if their customers are Spock-like Vulcans who make purchases solely according to cold logic.

Recognize that everything about the selling experience sends a message to customers that goes to the heart, not just the brain.

Focus exclusively on their supposed low prices, often because they have nothing else to offer customers.

Focus on having fair prices instead of playing mind games with “special offers”, fine print, and bogus sales.

Are open for business when it’s convenient for them, deliver products when it’s convenient for them, and so on.

Understand that people’s most precious commodity in the modern world is time and do everything they can to save as much of it as possible for their customers.


The Red Queen Effect


The Red Queen Effect

• The term is taken from the Red Queen's race in Lewis Carroll's Through the Looking Glass

• The Red Queen said, "It takes all the running you can do, to keep in the same place."

• For an evolutionary system, continuing development is needed just in order to maintain its fitness relative to the systems it is co-evolving with


If you use your skill and imagination to see how much

you can give for a dollar instead of how little you can give for a

dollar, you are bound to succeed.

• Henry Ford


How Is Wheaton Successfully Marketing Itself?

• Relationships• Consistency• Probing for “Sweet Spots”• Direct Marketing• CRM and tracking opportunities


What Drives WSP’s Performance?

• Service Performance• Quality

– Products– Communications– Solving problems quickly

• Brand name, built over 50 years• Product offering: breadth• People• Consistent operating strategy


What Trends Do I See In Marketing?

• Brands will remain relevant• Private label products will become more intrusive• A comprehensive service strategy will become more

important• Internet ordering will increase but will level off

because there will always be the need for human contact and service

• There will be an increasing commoditization of products– Customer retention strategies need to be refined


Conclusion

• Understanding a company’s markets, customers, competitors, strengths and weaknesses are critical to the “fact book”

• A marketing strategy and plan must be “SMART”• Stretch• Measurable• Achievable• Realistic• Time-bounded

• The marketing strategy has to be continually renewed in order to avoid the Red Queen effect


Coming together is a beginning. Keeping together is progress. Working together is success.

• Henry Ford

1 strategy and marketing in the laboratory products industry stephen drozdow

Documents

business marketing plan

wheatons marketing strategy

marketing planstrategy

business strategy

wheaton science products

business modelthe

business customers

business doesstrategy