mktg mix models

8/11/2019 Mktg Mix Models

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Analysing the Internal Environment: The Boston

Box

Present Position

Future Position


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Cash Cow:

-High mkt. Share in slow growing industry

-Generates excess cash -Mature and successful business

-Low investment required

-Needs to be managed for continued profit


3/18

Dogs:

-Low mkt. Share in slow growing industry

-Tends to reduce RoA -Might generate cash to breakeven


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Question Mark:

-Low mkt share in high growth mkt

-Has potential but requires substantial investment. -If QM does not become mkt.ldr could become dog


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Stars

-High mkt share in fast growing industry -Needs investment to sustain growth


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Strategies Cos. Could adopt:

A.Build Share : increase mkt share. ??-*

B.Hold : Invest just enough to keep SBU in presentposition

C. Harvest: Reduce investment to maximise short termcash flow *-cash Cow

D. Divest:By phasing out non profitable ventures


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PORTER 5 FORCE MODEL1.Threat of entry of new competitor:

-Barriers to entry(High entry & low exit)

-Brand Equity -Customer Loyalty

-Industry profitability


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Industry Analysis: Porters Five Forces


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2. Threatof Substitute pdts or services

-Relative Price

-Buyer Switching Cost -Perceived level of pdt differentiation

-Qlty depreciation

-Ease of substitution


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3.Bargaining Power of Customer:

-Buyer Volume

-Buyer info. Availability -Buyer price sensitivity

-Bargaining Leverage


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4. Bargaining Power of Suppliers:

-Supplier switching cost

-Strength of distribution of distribution channels -Presence of substitutes inputs


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Porters generic strategies

CostLeadership

Differentiation

Cost Focus FocusedDifferentiation

Cost Differentiation

Source of Competitive Advantage

Narrow Scope

Broad Scope


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PORTER GENERIC STRATEGIES 1. Cost Leadership:

- Low cost advantage through EoS

-Lower Operational Cost -Use Low cost to defend against substitutes

-Increase reach

-Protect from powerful suppliers


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2.Differentiation:

-Satisfy customer needs through sustainable

competitive advantage -Desensitize price & focus on value

-Addl. Cost in creating comp. Adv to be offset byincrease in revenue.

-increase customer attachment


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3.Focus:

-could be cost or differentiation

-analyse industry in which to compete -analyse competition

-strategy implementation to be in sync. With firmsactivities


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SWOT

Strength Weakness

Opportunity Threat

Positive Negative

Internal

External


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SWOT ANALYSISLeverage on Strength(internal)

Identify oppurtunities(macro environment)

Analyse Weakness(internal)Focus on threat (macro environment)


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AnsoffsMarket expansion gridMarket

PenetrationProduct

Development

MarketDevelopment DiversificationNewMarkets

ExistingMarkets

Existing

Products

New

Products

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