M2AnalysisandPlanning.ppt

1、Welcome to Marketing Principles and Processes Module 2 Analysis and Planning,Peter R. Dickson Backbone Press 2009,Analyzing Competition,Types of Supply Markets A Monopoly is where there is a single supplier, such as an electrical utility who has control over price, quality and supply. An Oligopoly i

2、s a market dominated by a few suppliers such as the detergent industry or other industries that require very large investments in equipment or technology.,Analyzing Competition,Types of Supply Markets Monopolistic Competition has many suppliers with a variety of product, each of which has a small ma

3、rket share. Perfect Competition is when many suppliers sell essentially the same product such as the Thompson Seedless Grape producers.,In marketing what we do to define our direct competition is to ask, “Who is taking sales from us? Who are we taking sales from?” Customers, distributors and retaile

4、rs can tell us this.,Analyzing Competition,Analyzing Competition,Market Share Market share is measured as a companys percentage of total industry sales over a specified time period. A companys market share can change dramatically depending on how the market is defined. In practice, the market is nor

5、mally specified by a realistic assessment of company resources and by company growth objectives.,Analyzing Competition,Most managers just consider their segment or product category competition and are sometimes blindsided by the success of less direct competition (e.g. Bottled water and iced teas ef

6、fect on diet cola sales).,Source: Adapted from Donald R. Lehmann and Russell S. Winer, Analysis for Marketing Planning (Homewood, IL. Irwin 1991). 22,Other Types of Share Brand Mind share: The share (%) of customers who name the brand when asked to name the first brand that comes to mind when they t

7、hink about buying a particular type of product. Brand Voice share: The share of media space or time the brand has of the total media share for that industry, often measured simply as dollars spent on advertising.,Analyzing Competition,Analyzing Competition,Other Types of Share Research and developme

8、nt: (R & D) share: A companys R&D expenditure as a percentage of the total industrys R&D expenditure. This is a long term indicator of new product innovation and thus market share. But studying market and other shares is yesterdays way of analyzing competition.,Analyzing Competition,Today we go to t

9、he theory of competition in Module 1 to help identify who and what has been driving competition over the last five years. We analyze the last five years of the market using the theory of competition.,Buyers preferences and wants are always being changed by changes in supply.,The variation in consume

10、r demand is constantly changing,Sellers learn directly and by observing other sellers how to add customer and shareholder value,Sellers with superior market analysis skills that are listened to are more competitive.,The supply of products and processes is constantly changing,Supply will shift to ser

11、ve the demand of the most profitable market segments,The economic processes change the economic structure that changes the social and political structure.,Sellers who implement faster are more competitive.,Markets are always in disequilibrium. Competition increases as supply exceeds demand.,Sellers

12、with an insatiable self-improvement drive are more competitive.,Effective products and process are quickly imitated and improved,Competition forces sellers to try new ways of serving customers and reducing costs,Who has been driving change? How?,What new added-value competitive processes have been i

13、ntroduced?,How has supply changed?,How has demand changed?,Analyzing Competition,Is the whole competitive dynamic speeding up? Are we driving change or following it? How driven are we, how alert are we? How adaptable are we?,Analyzing Competition,Competitor Audit The strategy guru Michael Porter has

14、 argued that competitive advantage in product quality and costs can come from one or more of the following stages of the added-value chain of processes within the company:,Purchasing Inbound Merchandising Marketing Delivery & processes operations and operations & Sales Service processes processes pr

15、ocesses Processes,Competitor Audit Where along this added-value chain does the competitor have superior processes and capabilities? Where does it have resources and extra capacity? Where are its competitive advantages in its internal processes? Are they unique, hard to imitate, sustainable over the

16、long-term?,Analyzing Competition,Analyzing the Competition,Competitor Audit Are our process managers and process thinkers better than rivals process managers and process thinkers? Is our company culture more driven to serve customers and accept change and become more effective and efficient than riv

17、als?,Analyzing the Competition,The 5-Forces Model Professor Michael Porter described 5-Forces that shape competition: The threat of new entrants Current competitors The threat of new substitutes The bargaining power of distributors The bargaining power of suppliers,Analyzing the Competition,The 3-Fo

18、rces Model But in marketing, we see it as a 3-Force model: The threat of new entrants Current competitors The threat of new substitute Suppliers and distributors are business partners with whom you form an alliance to gain collective and individual competitive advantage. This brings us to channel an

19、alysis,Analyzing Channels,Who are the latest entrants in the supply-chain? What new trading partnerships between suppliers and channels have been formed? What new technologies (such as wireless UPCs) are being introduced into channel processes such as ordering, buying, payment, warehousing, transpor

20、tation, and customs clearance processes?,Retailers and shareholders reinvest profits or invest in manufacturing and services insulated from global competition or leading global competition. Demand increases generally for all goods as a result of falling prices (an income effect) and in particular fo

21、r the lower priced goods (a substitution effect).,New communication and transportation technologies reduce transaction costs. Low labor costs and quality and on-time delivery assurance contracts make supplier attractive.,Retailer/distributor develops a trading alliance with new source.,Domestic and

22、global sources in existing trade alliances come under pressure to innovate, to reduce prices and increase services.,Retailer/distributor profits increase and or consumer prices drop in very price-competitive markets.,Domestic manufacturing output contracts as profits are lowered by global competitio

23、n.,Employment in manufacturing sectors exposed to fierce global price competition shrinks. Sectors that are insulated, such as health care, benefit from lower supply prices. Other sectors that lead the world in production and manufacturing innovation, such as pharmaceuticals, aerospace, and forest p

24、roducts, flourish.,If the net effect of shifting investment and employment is a recession, then the retailing/ distribution sector will react to reduced sales by seeking more global suppliers who will reduce cost of goods sold. If they do not, competitors will, and they will gain market share.,Retai

25、ler/distributor “discovers” a new global source of supply.,New communication (the Internet) and transportation technologies (the container) reduce transaction costs.,Analyzing Channels,Analyzing Channels,Researching a Supply-chain Partner Is it growing? What are its performance metrics? Its margins?

26、 Its stock-turn (annual sales/average inventory)? Is there a fit between our customer focus and the distributors customer focus? Is there a fit between our brand reputation and the distributors service reputation? Is there a fit between our systems and implementation processes?,How Good is the Fit?,

27、Analyzing Channels,How Good Are its Processes? Understanding the reasons for a channel members change in performance and behavior requires understanding its added-value chain:,Purchasing Inbound Merchandising Marketing Delivery & processes operations and operations & Sales Service processes processe

28、s processes Processes,Analyzing Channels,Where along the added-value chain does the distributor have advantages/strengths and disadvantages/weaknesses? Are the advantages unique, inimitable and sustainable? How can we help improve the distributor and take advantage of its added-value chain strengths

29、?,Analyzing Channels,How good are their process managers and their process thinking? How driven are they to become more effective and efficient at serving customers? Notice, again, how important process thinking is in evaluating the above added-value chain. Process thinking is also an important skil

30、l in environment scanning and analysis.,Analyzing Channels,Environment Scanning and Analysis,The Competitive Environment The Supply-chain Environment The Economic Environment The Legal Environment The Socio-Cultural Environment The Technology Environment The Natural Environment,Environment Scanning

31、and Analysis,Identify the major trends. Treat the trend line as a surface feature. Describe the dynamic processes driving the trend. Who will be the big winners and losers?,Environment Scanning and Analysis,-,-,Gas station stocking of convenience products,-,-,Gas pumps at convenience stores,Gas stat

32、ion revenues,Convenience store revenues,Convenience store and gas station competitive dynamic,The long-term downward trend in price dynamic,Environment Scanning and Analysis,Supply,-,Cost/Quality,-,Demand,Supply,Price/Quality,The long-term upward trend in quality dynamic,Environment Scanning and Ana

33、lysis,Supply,-,Sales Increase,-,Service and Product Quality,Costs and Price per unit of quality,Technology R&D,Environment Scanning and Analysis,-,-,The Theory of consumer search and prices dynamic,Consumer Search,Consumer Search,Market Law and Regulation,Trade between buyers and suppliers needs to

34、be protected by a strong and fair legal system. Trading contracts have to be able to be enforced by courts. Professional service providers should be licensed to protect consumers from imposters. Dangerous products and pollutants must be regulated. Consumer privacy protected.,Market Law and Regulatio

35、n,A lot of law is passed because repeated scandals and public uproar and repeated promises and efforts by industries and professions to improve their self-regulations fail to stop disgraceful behavior. As we shall see in Module 3 marketers are expected to do more than obey the lawthey are expected t

36、o behave ethically.,Planning Documents and Processes,Four Sets of Documents are Prepared Situation Analysis documents Strategic Planning (marketing mix) documents Implementation documents Budget documents They are prepared and used in sequence and do not appear all together in one grand plan.,Buyers

37、 preferences and wants are always being changed by changes in supply.,The variation in consumer demand is constantly changing,Sellers learn directly and by observing other sellers how to add customer and shareholder value,Sellers with superior market analysis skills that are listened to are more com

38、petitive.,The supply of products and processes is constantly changing,Supply will shift to serve the demand of the most profitable market segments,The economic processes change the economic structure that changes the social and political structure.,Sellers who implement faster are more competitive.,

39、Markets are always in disequilibrium. Competition increases as supply exceeds demand.,Sellers with an insatiable self-improvement drive are more competitive.,Effective products and process are quickly imitated and improved,Competition forces sellers to try new ways of serving customers and reducing

40、costs,Sellers with superior market analysis skills that are listened to are more competitive.,The Theory of Market Dynamics in Practice,Planning Documents and Processes,Changes in channel environment,Changes in consumer environment,Changes in competitive environment,Changes in regulatory environment

41、,12%,43%,51%,27%,50%,% of large companies reporting such changes in marketing plan situation analysis. A lot do not.,Source: Howard Sutton, The Marketing Plan (New York: The Conference Board, 1990).,Planning Documents and Processes,Planning Documents and Processes,Source: 1990 Conference Board Study

42、,% of Companies where marketing strategy is set by senior management before plan is prepared Choice of target markets42.4% New product/service development38.9 Market penetration strategy27.6 Pricing strategy44.8 Product/service positioning35.0 Distribution strategy27.6 Advertising strategy26.1 Are s

43、enior management flying-blind?,Planning Documents and Processes,Sources of Analysis and Expertise Internal secondary data are records, information and reports that already exist within organizations, such as sales records and financial reports, and old market research study reports. External seconda

44、ry data is data that resides outside the firm such as in trade publications, government reports and consultants reports. You find it by Googling.,Planning Documents and Processes,Secondary Data Analysis Used to find and explore opportunities and recognize constraints and forces in the environment th

45、at exists in foreign or domestic markets. For example, /ibrd/marketpot.asp provides a lot of valuable secondary information about foreign markets.,Planning Documents and Processes,Calling Experts Calling and asking for information from a government expert or staffer at an ind

46、ustry trade association can be the best $s you will ever spend on market research and situation analysis. Politely introduce yourself, give your name and the name of the person who recommended that you call, and state the purpose of your call. Do your homework on the Internet before you make the cal

47、l.,Planning Documents and Processes,Calling Experts Be enthusiastic, courteous, and grateful and do not interrupt too much. Become a good listener and listen rather than preparing yourself for the next question! Use a list of questions if you have number of questions, but try not to make it too obvi

48、ous that you are following a list.,Planning Documents and Processes,Calling Experts Send a thank you note or e-mail (you may wish to call again), and offer to return the favor. Thank you notes can help your source when it comes to promotions. Try to generate new leads from experts as they almost alw

49、ays know other experts.,SWOT Analysis and Strategic Planning,After completing the Situation Analysis Documents what do you do next? You look for and address the threats to your current profitable business. You identify new profitable business development opportunities and assess their prospects.,SWO

50、T Analysis and Strategic Planning,Strengths Process competitive advantages Strong partners Strong brand reputation Resources, patents, assets, people Experience, knowledge Deep pockets Excellent distribution reach Processes, systems, IT, communications Team based culture (open to change) Company pol

51、itics and values,SWOT Analysis and Strategic Planning,Weaknesses Process competitive disadvantages Weak partners Weak brand reputation No resources, patents, assets, people Inexperience, lack of knowledge No pockets Poor distribution reach Processes, systems, IT, communications Bureaucratic cultural

52、, attitudinal (resists change) Company politics and values,SWOT Analysis and Strategic Planning,Opportunities Industry or lifestyle trends Technology development and innovation New global supply chains New market segments Business and product development? Information and research? Decrease in input

53、costs such as labor costs New partnerships and distribution channels,SWOT Analysis and Strategic Planning,Threats Political, Regulatory, Economic, Nature Competitor innovations Falling market demand Changing consumer preferences New competitive entries, new substitutes Increase in input costs such a

54、s oil Loss of key staff,Is there exceptional buyer utility in your business idea?,Is your price affordable to your target segment?,Is the target sales volume feasible given your costs, price and target profit?,From W. Chan Kim and Renee Mauborgne, Blue Ocean Strategy, HBS Press, Boston, 2005, p. 118

55、,SWOT Analysis and Strategic Planning,Ask These Questions in Doing the SWOT Analysis,New design,New service program,New pricing strategy,New distribution program,New promotion campaign,Target segment,Channels/facilitators,Competitors,Public policy,Economic climate,Cultural Climate,Manufacturing,Mark

56、eting mix programs,SWOT Analysis and Strategic Planning,SWOT 2.0,Click to see planning document,Marketing mix programs,SWOT Analysis and Strategic Planning,Double click to find out why fit between new design and target segment is a unique competitive advantage.,New design,New service program,New pri

57、cing strategy,New distribution program,New promotion campaign,Target segment,Channels/facilitators,Competitors,Public policy,Economic climate,Cultural Climate,Manufacturing,SWOT 2.0,How to Implement Plans,So when you choose to implement a business development opportunity, how do you do it? You use t

58、he innovation process (product development process) described in Module 6. You use the diffusion of innovation processes (distribution processes) described in Module 10.,Buyers preferences and wants are always being changed by changes in supply.,The variation in consumer demand is constantly changin

59、g,Sellers learn directly and by observing other sellers how to add customer and shareholder value,Sellers with superior market analysis skills that are listened to are more competitive.,The supply of products and processes is constantly changing,Supply will shift to serve the demand of the most profitable market segments,The economic processes c