You are on page 1of 27

Building Blocks for Securing Market Insight

Market Structure
Market and
Product Evolution

Market Insight

Environmental Forces Industry Forces

Market and Product Evolution
Market and Product Evolution

Product Class and Product Form Life Cycles

Market and Product Evolution

Sales and Profit Margin Life Cycles

Market and Product Evolution

Truncated Life Cycle

The art of controlling and utilizing resources , to the end of
promoting and securing vital interests of the firm.

A broad formula for how a business is going to compete.

Competitive strategy is being different. It means deliberately

choosing a different set of activities to deliver a unique mix of
value (creation of a unique and valuable position).

Is it also about the same set of activities as competitors?

Is there an elusive ideal point, which everyone is looking for ?

Strategy ( Cond..)
Strategy is a plan that aims to give the
enterprise a competitive advantage over
A difference that could be preserved
Operational effectiveness : Perform similar
activities better than rivals
Strategic positioning : ??

Ex- Japanese firms, Air Asia, Ikea, Maruti True

Value, Ginger hotels
Differential Advantage

Differential advantage is a net benefit or cluster of benefits, offered to a

sizable group of customers, which they value and are willing to pay for, but
cannot get, or believe they cannot get, elsewhere.
Differential Advantage

Differential Advantage:
Emphasizes competition: customer value is not enough.
Some advantages are better than others.
Differential advantages may eventually erode renewing differential
advantage is crucial.
The firm must be willing to cannibalize its differential advantage.
A difference is not a differential advantage.
Sustainable competitive advantage

- Something the firm can persistently do better

than its competitors.
- A wall that the firm has built around it.
Sources of SCA
Its different ! Often the claim made in TVCs..

Who values this difference?

Should the firm deliver this value?
Can the firm deliver this value?

Ex: Scotch brite vs. Local brands

Splenda vs Equal , Sweet N Low
Coca cola vs Ras Cola
Strategy for Growth

Growth path
Timing of entry
Strategy for Growth: Vision

A description of the ideal future state concerning a firm/business

Set broad direction and inspire

Ford Motor Company circa 1920s A car in every garage
Microsoft 1980s/1990s A personal computer on every desk
Microsoft 2000s To enable people and businesses throughout
the world to realize their full potential
Strategy for Growth

Growth path
Timing of entry
Strategy for Growth: Mission (I)

Scope of business
(industry, products, competence, market segment,
vertical, geographical)

Guides the firms search for market opportunities
Codify where the firm does well, or aspires to do well
Mission (II)
What business are you in ?
Where do you want to go ?
What do you need to do to accomplish the set
goals and objectives ?

Alternative Bases Internal Resources

Core ingredient or natural resource
We are a forest products company.
Product or service
We are an automobile firm.
We are an electronics firm.

Alternative Bases External Focus

Customer needs
We satisfy peoples transportation needs.
Market or market segment
Our markets are families with young children.

Core ingredient or natural resource (IR)

Product or service (IR)
Technology (IR)
Customer needs (EF)
Market or market segment (EF)

Mission directs search for market opportunities


Mission: Illustration Courtyard by Marriott (CM)

To provide economy- and quality-minded frequent business travelers with a
premier lodging facility, which is consistently perceived as clean,
comfortable, well-maintained, and attractive, staffed by friendly, attentive,
and efficient people.
Combines product/service (IR) and market/market segment (EF).
Mission statements
To achieve our objectives in an environment of fairness,
honesty, and courtesy towards our clients, employees, vendors
and society as large. ( Infosys )

To be an Indian multinational engineering enterprise providing

total business solutions through quality products, systems and
services in the field of energy, industry, transportation,
infrastructure and other potential areas. ( BHEL)
We help people trade practically anything on earth. We will
continue to enhance the online trading experiences of all-
collectors, dealers, small businesses, bargain hunters,
opportunity sellers, and browsers. ( eBay)
The Strategy Process

Defining the Mission


Strategy creation ( Strategic positioning , operational effectiveness)

Implementation tactics

Performance measurement
Marketing and business strategy

Corporate level ( Corporate goals, broad marketing strategy)

Business unit level ( Business unit goals, marketing plan with

budget and specific tactics)

Product-line level ( Product-line goals, marketing plan with budget

and tactics)
Marketing in Business Strategy
Why Marketing is important for formation of
business strategy ?
What can marketing contribute to the
business strategy ?
Developing a Marketing Plan

1. Defining the Mission


2. Situation Analysis

3. Identifying and Evaluating Opportunities (


Segmentation, Targeting & Positioning)


4. Implement Marketing Mix and Resources


5. Evaluate Performance
SWOT Analysis

Environment Evaluation
Positive Negative
Internal Strengths Weaknesses
Supply chain Over- reliance on
Well-known brand relationships
External Opportunities Threats
Liberal laws, reforms Public protest
Schemata of Marketing Process
Marketing Analysis ( The 5 Cs)

Consumers Company Competitors Collaborators Context

Creating Market Target Product and

Value Segmentation Market Service
Selection Positioning

Marketing Mix ( The 4 Ps)

Capturing Product & Service Place/ Channels Promotion



Value Customer Retention