marketplace intro

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Copyright 2006 Ernest R. Cadotte Introduction to Strategic Marketing

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This presentation is an introductory one for stratetegic marketing management subject i studied as a part of my MBA curriculum.

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Page 1: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Introduction to Strategic Marketing

Page 2: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Marketplace is a fun way to learn about marketing!

• It is a marketing game.• It is learning by doing.• It brings to life marketing concepts, principles, and ways of

thinking.• It energizes the competitive spirit.

Page 3: Marketplace intro

Copyright 2006 Ernest R. Cadotte

It is Realistic• You do what your real-life counterparts do

– Design brands– Design ad copy– Schedule media– Set selling prices – Hire and train sales people– Worry about profits

Page 4: Marketplace intro

Copyright 2006 Ernest R. Cadotte

It is Organized

• The game scenario follows the logical process of starting up a new product line.

• You are guided through the decision-making process.• Detailed help files are available at the touch of a button.

Page 5: Marketplace intro

Copyright 2006 Ernest R. Cadotte

How is the marketing game conducted?

• Teams are placed in a game scenario in which they start up and run a new marketing division.

• The opposition can be played out by computer-generated competitors or other student teams.

Page 6: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Objective is to profitably capture a dominant market position

Business Team Market

Opponent

Opponent

Opponent

Page 7: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Game Scenario

• You work for a large international electronics firm.• Corporate Headquarters wants to enter the personal computer business.

Page 8: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Game Scenario

• You have been selected to head up the new marketing division to sell computers into Asia, North America, and Western Europe.

• Several other international firms are entering the market at the same time.

Page 9: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Game Scenario• Your marketing strategy will be tightly focused on direct sales to business

customers.

– You will not sell to the home market or through retail stores.

– You will sell through company-owned sales offices in major metropolitan markets around the world.

Page 10: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Available Market Segments (Market Structure)

Price

Performance

Cost Cutter

WorkHorse

TravelerInnovator

Mercedes

Page 11: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Sales Office Options (12)

Page 12: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Marketing Team• Each team member assumes a tactical area of responsibility:

-Brand management

-Advertising

-Sales office management

-Overall leadership• Everyone is responsible for marketing research and profit management.

Page 13: Marketplace intro

Copyright 2006 Ernest R. Cadotte

How Conducted?• At the outset of each quarter, you will receive information on the current situation.• The current situation is evaluated, strategy formulated, and tactics set in place.• Tactical decisions are fed into the marketplace simulator, along with decisions of

opponents.• Results of decisions are fed back to you.

Page 14: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Chronology of Events• Q1: Organize the team, name the company and contract for a survey of potential

customers.

• Q2: Analyze market information, establish strategic direction and set up shop

(design brands and set up sales offices).

Page 15: Marketplace intro

Chronology of Events

• Q3: Test-market brands, prices, ad copy, media campaigns, sales staffing. • Q4: Study end user feedback, competition, and financial performance and

make adjustments in strategy.

Page 16: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Chronology of Events

• Q5: Prepare a one-year marketing plan. Present marketing plan to

Executive Board from Corporate Headquarters and obtain its approval.

Page 17: Marketplace intro

Copyright 2006 Ernest R. Cadotte

• Q6 – Q8: Refine the marketing strategy– Introduce new brands with new R&D features.– Continue with market expansion by adding

advertising, sales people and new offices.– Study the market and financial data to

determine how to better meet customer needs and surpass the competition through brand design, pricing, advertising, and distribution.

Chronology of Events

Page 18: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Funding• The initial funding is 20,00,000 which is being invested by Corporate Headquarters

in 5,00,000 increments over the first 4 quarters.

• Corporate Headquarters will provide another 50,00,000 in Quarter 5 if it approves

your marketing plan for the second year.

Page 19: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Learning Strategy

Marketing simulations are a form of combative training where you pit your marketing skills against those of formidable opponents under the watchful eye of a training coach.

Page 20: Marketplace intro

Copyright 2006 Ernest R. Cadotte

When we work strictly in our functional silos, we are like blind people trying to understand what an elephant is.

Please tell mewhat it is?

It’s a snake.It’s atree trunk.

It’s a sheetof rawhide. It’s a steel

tube.

Page 21: Marketplace intro

Copyright 2006 Ernest R. Cadotte

With marketing simulations, you can crawl all over and under the marketing organization to see and understand the whole thing.

It is a marketing organization!

Brands

Distribution

ResearchPricing

Advertising

Page 22: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Learning Strategy:Learn by Doing

• You learn about all aspects of marketing by managing a simulated marketing department.

• The Marketplace scenario follows the life cycle of a new product.• Marketing decisions are introduced as they become relevant in the evolution of the

product.

Page 23: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Quarter 2 Establish Strategic Direction

Page 24: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Q2: Establish Strategic Direction• Analyze market information• Establish strategic direction

– Select 2 target segments– Decide on competitive posture

• Set up shop

– Develop distribution strategy• open initial sales offices for test market

– Design 2 brands, 1 for each target segment

Page 25: Marketplace intro

Copyright 2006 Ernest R. Cadotte

How do you determine the design of each brand?

Page 26: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Customers Buy BenefitsNot Features

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Copyright 2006 Ernest R. Cadotte

How far do you go in giving the customers what they

say they want?Is more speed, software applications, memory,

keys on the keyboard, etc. always valued?Could “more of some feature” even make a customer unhappy?

Page 28: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Learning Points for Quarter 2

• Market opportunity analysis• Segmentation and target marketing• Strategic and tactical planning• Game theory - competitive positioning

Page 29: Marketplace intro

Copyright 2006 Ernest R. Cadotte

Learning Points for Quarter 2

• Brand design – Linking product features to customer benefits– Finding the customer’s response functions

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Copyright 2006 Ernest R. Cadotte

Quarter 3 Go to Test Market