Marketing Frameworks
When, , How, , Where, , Which
Disclaimer: The models and frameworks explained are just indicative of the processes. Live marketing scenarios dont need textbooks, it needs something much more rarer: COMMON AND UNCOMMON SENSE
Do they sound familiar
ITCs e-choupal p decides to source raw materials directly y from the source HLL becomes HUL HUL provides back end support to its distributors Dabur plans expansion in retail Air Deccan follows low cost leadership Air Deccan merges with Kingfisher Airlines Toyota uses Lean manufacturing system Pepsi hits back with two new flavors for Tropicana Good knight mats uses a new mosquito repellant technology Godrej is in talks to buy out Tortoise P&G to cut managerial staff to counter rising input costs
Strategies in action
Corporate Strategy Business Strategy Functional Strategy
Information fl flow
Strategies in action
Corporate Strategy Business Strategy Functional Strategy
Those aimed at improving effectiveness of company companys s operation Efficiency, Quality, Innovation Customer Innovation, Responsiveness.
Strategies in action
Corporate Strategy Business Strategy Functional Strategy
Developing firm specific business model to gain competitive advantage. Market demand, Competitive analysis, Pricing O i Option, Differentiation
Strategies in action
Corporate Strategy Business Strategy Functional Strategy
To identify businesses in which the company should participate, value creation activities it should perform and the best means to do so. M&A O M&A, Outsourcing, i Horizontal/Vertical Integration
Porters Porter s five forces
Apply porter porters s framework to retail industry
Business Strategy in action
BROAD MA ARKET T SC COPE
COST LEADERSHIP STRATEGY e.g. Wal-Mart DIFFERENTIATION STRATEGY e.g. Pepsi, Coke
NARROW
FOCUSSED LOW COST STRATEGY e.g. iTunes Store
FOCUSSED DIFFERENTIATION STRATEGY e.g. Royal Enfield
LOW COST
UNIQUE PRODUCT
SOURCE OF COMPETITIVE ADVANTAGE
SWOT Framework
Suppose XYZ company wants to launch a new product Reposition its existing line of products Evaluate a new channel alternative Entering a ne new segment
Cs and Ps
Customer Consumer Company Competitor
Analyze customer, size accounts, relationship building, rewards and incentives Growth, private label, emerging channels
Need, willingness to pay, buying behavior, segmenting and targeting New users, current users, competitors users
Core competency, resources, organic/inorganic growth, cost structure Partner, stakeholders, complementary products, culture, management style
Type of market, monopoly etc, positioning, strengths, product portfolio, market share, cost advantage Service v/s products products, existing and new players players, consolidation
Cs and Ps
Product Price Promotion Place
Company attributes, product attributes, service attributes
Willingness to pay, Market share v/s margin, Customization, Competition, Value offering
Advertising, Public Relations, Sales force, Direct Marketing, Packaging, Sales promotion
Distribution strategies, channels, geographies, bundling, logistics, lot size, quality assurances, channel conflict conflict, incentives incentives, after sales service
Evaluating the companys company s existing line of businesses
HUL decides to divest its hair oil portfolio ITC channels its money from the cigarette business to other categories Bajaj decides to consolidate its 125 cc segment portfolio Airtel invests heavily in GSM segment
A typical case of a motor manufacturing company
But how does a company evaluate its growth opportunities
Market v/s Product Grid
Market Penetration Strategy gy Product Development Strategy gy
Market Development Strategy
Diversification Strategy
Examples
Market Penetration
Price based promotions New and Improved Bundling strategy
Market Development Product Development Diversification
Subhiksha planning to enter Maharashtra Idea expands its circle j j exporting p g automobiles Tata and Bajaj Coke goes Diet Pepsi launches Tropicana range Colgate C l t entering t i i into t th the gel l segment t ITC enters into personal care Dabur entering into fabric care Emami enters edible oil business
Behavioral Segmentation : VALS
Apple iPod Nokia BMW 3 series Lifestyle, Shoppers Stop Titan watches Imitation Jewelry Maruti 800 Eveready batteries, 7 o clock razor, Desert Coolers, HMT
CAB model Three hierarchies
Effect
Cognition
Behavior Behavior
Standard Learning Hierarchy
Cognition Behavior Effect
Low Involvement Hierarchy
Affect Cognition
Experiential Hierarchy
Product Life Cycle
St t i at Strategies t each h stage t
Introduction Visualize various market segments (product markets) pioneer can initially enter Analyze profit potential of each segment Decide on market expansion plan Growth Improve product quality & add new product features and improved styling Add new models & flanker products Enter new market segments Increase distribution coverage & enter new distribution channels Shifts from productawareness ads to product-preference product preference ads Lower prices to attract next layer of price i sensitive i i buyers b Maturity Market modification Converting non-users Entering new market segments Winning competitors customers Increasing volume (use product on more occasions, more of the product on each occasion, in new ways) Product modification Quality, features Marketing program modification Prices, Distribution, Advertising, Sales promotion, i Personal P l selling, Services Decline Increase investment (to dominate the market or strengthen competitive position) Maintain investment level until uncertainties about industry are resolved Decrease investment level selectively drop unprofitable customer groups, strengthen in lucrative niches Harvest (milk) investment to recover cash quickly
Few Others
Velocity Break even analysis (volume/sales) Price Elasticity Service brands
