market as startegy

8/3/2019 Market as Startegy

http://slidepdf.com/reader/full/market-as-startegy 1/52

MARKETING AS STRATEGY

PRESENTED:

PROF: PRASANNA SALVI

4/28/2012 MARKETING STRATEGY 1



GROUP # 9


SHERWIN.M (M1025)

NIKHIL.P (M1033)

PREMLATA.R (M1042)



CONTENT

• CHP 5

• CHP 6

• CHP 7

•

CHP 8




CHAPTER 5

FROM BRANDEDBULLDOZERS TO GLOBALDISTRIBUTION PARTNERS

4/28/2012 4MARKETING STRATEGY



INTRODUCTION

• Over the last two decades ,there have been remarkable

shift in power down string

•

Increasing power of resellers

• Most significant M&A activity has been cross-border

• Since manufacturer price for the same product vary by as

much as 60% among countries




CONT….

• Company like Wal-Mart using global sourcing to get the

best product worldwide

•

The retailers adopting of global pricing policy candramatically effect on manufacturer




THE CHALLENGE FROM

GLOBAL RETAILERS

• The growth retailing has been substantial

• Example : Carrefour and Metro operate more than 24

countries

• Tesco and Wal-Mart operate in more than 10 countries




THE RETAILER CHALLENGE TO

MANUFACTURERS

• The emergence of global players has transformed retailing into a

sophisticated, technologically intensive and systems driven

business

• Powerful global retailers are demanding more from their

branded multinational suppliers

• In every part of the world, global customer expect coverage,

speed, consistent and high quality

• They are pushing manufacturer to low price, more promotion,

slotting allowances




THE CHALLENGES OF GLOBAL

INTEGRATION FOR RETAILER

• You must adapt your food and other product to the local

culture

•

While they many make more decisions centrally on privatelabels and category management

• Regrettably for manufacturer, retailers recognize that

global integration is their key challenge




DEVELOPING A RELATIONSHIP

MIND-SET

• To implement global account management, suppliers and

their global retail partners must develop a shared

relationship building mind-set




TWO TOUGH COMPANIES

LEARN TO DANCE TOGETHER

• World has it that P&G and Wal-Mart are two tough

negotiators

•

Over the year P&G established its reputation as a “self -aggrandizing bully of the trade”




CREATE TRUST, NOT FEAR

• P&G and Wal-Mart partnership illustrates that exploiting

power in distribution channel pays in the short run not in log

run for three reasons

I. Extracting unfair concessions

II. When company systematically exploit their advantage, the

victim ultimately resist by developing countervailing power

III. Only by developing mutual trust and collaboration closely




ADOPT FAIRNESS PRINCIPLE IN

RELATIONSHIP

• To develop trust, the more powerful party must treat the weaker

one fairly

I. Distributive justice

II. Procedural Justice

Communication

ImpartialityFamiliarity

Explanation




IMPLIMENT EFFICIENT

CONSUMER RESPONSE

• In which the retailer and manufacturer work closely

together to eliminate excess cast and serve the consumer

cheaper, faster and better

• Through ECR retailer consulting firm, was commissioned

to document the potential saving




CUSTOMER CENTRIC GLOBAL

ACCOUNT MANAGEMENT

• Many companies moving fast on global account

management

•

Most manufacture are reactive rather than proactive

• Marketing plans and supply chains must become customer

centric instead of country centric




INFORMATION SYSTEMS

TRANSFORMATION

• Major multinational company go crazy because his people

could not tell him, with any degree of accuracy

•

Information systems transformation very important forMNC company

• EX: P&G and Wal-Mart use information systems

transformation




HUMAN RESOURCES

TRANSFORMATION

• Coordination

• Co-location

•Composition

• compensation




CHAPTER 6

FROM BRAND ACQUISITIONSTO BRAND RATIONALIZATION




INTRODUCTION




BRAND PROLIFERATION IS

COSTLY

I. Insufficient differentiation

II. Inefficiency

III. Lower market power

IV. Management complexity




THE CHALLENGE OF BRAND

RATIONALIZATION

• Deleting brand is easy but retaining their sales and

customer is not

• Therein lies of managerial dilemma: How can brand

portfolio be pruned losing the customer and sales revenue

of doomed brand?

• To stem such a losses manager often try to merge two

brands instead of deleting one

• Example: Kal Kan and Crave become a Whiskas.




THE BRAND RATIONALIZATION

PROCESS

I. Conduct a Brand Portfolio Audit

II. Determine the Optimal Brand Portfolio

III. Select Appropriate Brand Deletion Strategies

IV. Develop a Growth Strategy for the Surviving Brand




TOP DOWN PORTFOLIO

BASED APPROACH ATUNILEVER




FROM MARKET-DRIVEN TOMARKET-DRIVING

CHAPTER: SEVEN




MARKET DRIVEN

• Determined by or responsive to market forces

• Market-driven organizations have a thorough

understanding of customers and potential customers,

including their changing needs and wants

• A key activity for a market-driven organization is

information gathering

• Emphasis must be placed on an organizations ability to

respond to environmental changes.




MARKET DRIVING

• Dr. Philip Kotler identifies as the fourth major market

orientation

• It focuses on playing a different game, of breaking the rules,

rather than just being better

• “Market-driving strategies define how a firm will embrace

innovative changes in the industry logic and business system to

grow its profit and industry’s demand from marginal and non-

customers,”- Prof. Greg Carpenter of Kellogg Graduate School

of Business




THE MARKET-DRIVING FIRM

Market Driving IKEA Style

• Ingvar Kampard opened his furniture retailer IKEA in 1950’s

• Turnover of 11 billion euros

• It focussed on young people and young families

• It offers clean Scandinavian design and image, tremendous

assortment, immediate delivery, a pleasant shopping atmosphere

and low prices in exchange for self-service, self assembly, and

self transportation of purchases




CONDT..

• The key to the success of market-driving firms is that they

create and deliver a leap in benefits, while reducing the

sacrifices and compromises that customers make to receive

those benefits

• They create a product or service experience that vastly

exceeds customer expectations and existing alternatives,thereby elevating the industry landscape




FOUR ORIENTATIONS TO THE

MARKETPLACE

• Market Driving

• Sales Driven

•

Market Driven

• Customer Driven




HOW MARKET-DRIVING FIRMS

SEIZE ADVANTAGE

• Lead by Vision Rather Than by Market Research

– Swatch research

–

FedEx

– Sam Walton’s initial attempts at opening stores were

underwhelming




CONDT..

• Redraw Industry Segmentation

– Destroy the industry segmentation that existed and replace it

with a new segments

– Aravind eye hospital did not accept the segmentation

between rich and poor

– Southwest airlines destroyed the segmentation between

ground transportation and airlines

– Wal-Mart demonstrated that small rural towns could

support huge discounts




CONDT..

• Create New Price Points for Value

– Swatch, Aravind Eye Hospital, SW Airlines all set

prices much lower than those previously available forsimilar products

– SW Airlines price=ground transportation




CONDT..

• Educate Customers for Sales Growth

– Task for market driving firms is not to sell but rather to educate

the customer on the existence of, and how to consume, their radical

value propositions

• Aravind Eye Hospital must educate that their vision can in fact

be restored and the surgery is available for them free of charge

• IKEA had to teach the benefits of transporting furniture home

for self assembly instead of buying it preassembled and

delivered




CONDT..

• Reconfigure Channels

– Reconfigure your channel that yield a unique businesssystem

• FedEx transports packages using its own planes via

a “hub and spokes” air freight system • Benetton subcontracts simple, non essential tasks,

only quality-maintenance task (dyeing) are done bythem

•

Wal-mart insists that P&G and other supplierseliminate wholesalers, adopt edlp and establishelectronic links with its stores, all to eliminateconsiderable costs




CONDT..

• Exploit the “ Buzz Network” for Brand Attachment

– SW Airlines boasts “We have a lot of ambassadors out

there, our Customers. – Nike did not run a single national television ad until it

reached $1 bn in sales. It used “word-of-foot

advertising” by getting the best athletes to wear its

products.




CONDT..

• Overwhelm Customer Expectations

– Poor patients of Aravind Eye Hospital never expected to

regain their sight, since surgery was out of their

geographical, economical & psychological grasp

– WalMart although provides good services, but whenever it

rains in Houston, an umbrella-weilding service rep walks

customers to their cars

– SW Airlines had fewest customer complaints, fewest delays,

and fewest mishandled bags between 1987-1993




BARRIERS TO MARKET

DRIVING IN INCUMBENT FIRMS

• Market-Driving Ideas Are Risky

• Market-Driving Ideas Consistently Lose to Incremental

Innovation• Market-Driving Ideas Cannibalize Existing Business




THE MARKET-DRIVING

TRANSFORMATION PROCESS

1. Develop Processes to Identify Hidden Entrepreneurs

2. Allow space for Serendipity (Luck)

3. Select and Match Employees for Creativity

4. Offer Multiple Channels for New Idea Approval

5. Establish Competitive Teams and “Skunk Works”

6. Cannibalize Your Own Products

7. Encourage Experimentation and Tolerate Mistakes




FROM STRATEGIC BUSINESS

UNIT MARKETING TOCORPORATE MARKETING

CHAPTER 8




INTRODUCTION

• Marketing strategy focuses on business units and ignores

the role of marketing at corporate level whereas, the CMO

position is emerging in companies as diverse as Coca-Cola,

Nokia, KPN Qwest, Pizza Hut and Reuters.

• But still hesitate to appoint CMOs or build a large

corporate marketing function because they do not knowwhether marketing can add any significant value from the

corporate centre.




THE ROLE OF THE CORPORATE

CENTER• Portfolio choices:

– BCG Matrix

– General Electric Matrix

• Portfolio relationships:

– Disney searches for synergies within its portfolio.

• Parenting skills:

– Parenting advantage exists if the parent has uniquecapabilities, resources , skills, expertise, or access toimportant stakeholders that can help the individual businessunits.




CONDT..

1. Leverage product platforms:

• Wal – Mart entry into China

• Toyota Camry, Lexus ES300, Sienna minivan,

Toyota highlander and the Lexus RX300 SUV’s

have shared interchangeable parts and a common

platform across generation.

2. Exploit brand platforms:

• Corporate marketing is the steward of the corporate

brand, it develops, refines, and protects the common

brand heritage and strengthens brand equity.




CONDT..

3. Extend channel platforms:• Ford motor’s luxury brands of Volvo, land rover, and

jaguar could combine their distribution points andconsolidate into larger dealerships rather than individualdealers for each brand.

4. Nurture customer as platforms:

• Citibank & Amazon

5. Develop markets as platforms:

• CM can initiate regional consolidation of marketing staff toexploit economies of scale and scope.

• B&Q China




EMERGING MARKETS AS A

GROWTH PLATFORM• Targeting growing masses in emerging markets:

– Focus on the emerging markets of Asia, Latin America,

and Africa

– The 2.5billion in China, India& Indonesia account for

more than 40 % of the world population.

– Coca-cola& Honda

• Keep the value proposition simple, and keep it cheap:

–

A typical value proposition of multinational co in theemerging markets is usually a global product with

slight modifications.




CONDT..

• Reinvent the three Vs model for the model for the masses:

– Reinventing the value networks that underlie the

current industry business models at much lower costs.

– Banco Azteca (bank in Mexico)

• Hindustan Lever:

– An emerging market winner

Indian mass market, Indian consumersProject shakti

– Transfer best practices across markets


G C S O



BUILDING CUSTOMER-

FOCUSED CAPABLITIES

• A customer-focused organization has a customer

orientation (strategy & culture), a customer-driven

configuration (organization and processes), and customer

investments (competences and resources).




CONTD..

1. Customer-Focused Strategy Map:

1. Strategy is asking the right question

2. Customer- Focused Processes Map:

1. New Product Development Process

2. Order Fulfillment Process

3. Customer Relationship Management Process




CONDT..

3. Customer- Focused Organization Map

1. Organize Around Customer

2. Specify Measures And Rewards Customer-OrientedBehaviors

3. Empower Employees To Resolve Customer Problems4. Customer- Focused Culture Map:

1. Create a Customer-Driven Mission

2. Involve General Managers With Customers

3. Manipulate Symbols To Reinforce The Primacy Of Customers

4. Develop Norms Of Customer Obsession




CONDT..

5. Customer- Focused Competences Map:

1. Continuously learn about customers

2. Benchmarking marketing

3. Develop marketing talent

4. Invest in customer-focused systems6. Customer- Focused Resources Map :

1. Understanding the Role Of Marketing Metrics

2. Define Marketing Matrix

3. Conduct Marketing Experiments To Demonstrate ReturnOn Investment

4. Confront Marketing Mix Allocations

5. Allocate Adequate Resources To Marketing


THE CHALLENGES OF BEING A



THE CHALLENGES OF BEING A

CUSTOMER- FOCUSED FRIM

• CM to define what it needs from all other functions, what

it will contribute and where collaboration is necessary.

– Making Market Transformation Happen

– The CEO As Commander, Chairman, Coach, And

Catalyst

– Stimulate Great Conversations Around Customers

– Marketing as a change agent




THANK YOU

market as startegy

Documents