MARK4210 Class 5 Situation Analysis Complete

MARK 4210 Professor Eugene R. Raitt.
Spring 2021
Situation Analysis
MARK 4210 Professor Eugene R. Raitt. Spring 2021
2 Course Roadmap
Fundamentals Elements of Marketing Strategy Application
Situation Analysis
(Customer, Competitor, Company)
Market Selection
- Quantitative Analysis Simulation Game
(Segmentation, Targeting, Positioning)
- Consumer Behavior PharmaSim
Marketing Mix Formulation

(Product, Pricing, Distribution, Promotion)
TODAY’S AGENDA
3
• Situation Analysis
• Caselet – McDonald’s
SITUATION ANALYSIS
4
• Effective marketing strategies are based on solid

understanding of internal and external marketing
environments
• Frameworks to collect, analyze, and synthesize information:
• 5C’s Analysis
• Porter’s Five Forces Analysis
• SWOT Analysis
Source: Marketing Analysis Toolkit: Situation Analysis, Steenburgh & Avery, Harvard Business School
5C’S : CUSTOMER ANALYSIS

5
• One of the most important thing to understand is the

needs/values the product fulfills/delivers for consumers –
features versus benefit approach
• Analyze direct and indirect product benefits to assess

which attributes are important to consumers
• Distribution of consumer needs provides important input

into segmentation and targeting decisions
6 5C’s: Customer Analysis

TYPES OF CUSTOMER
VALUES
Psychological
Economic Functional
Source: Capon’s Marketing Framework, Capon, Wessex Publishing

5C’S: CUSTOMER ANALYSIS

7
• Types of customer values

• Economic value
• Provide financial benefits such as lower price or lower overall costs (TCO) for
customers
• Functional value
• Products and services that provide tangible benefits and values that serve specific
functions
• Psychological value
• Typically satisfy status, affiliation, reassurance, risk and security needs
Source: Capon’s Marketing Framework, Capon, Wessex Publishing

8
5C’ s: Company Analysis
Analyze your business model
Product/service offerings
Revenue model
Core competencies
Understand the financial aspects

e.g., prices/margins, costs/expenses
Know your organizational components

e.g., management structure, corporate culture

• What’s your competitive advantage?
• Know your core competencies -- a deep proficiency that
enables a company to deliver unique value to customers
• POD and POP
• Porter’s Generic Strategies to achieve competitive advantage
• Cost leadership: Create low-cost structures to be price competitive
• Differentiation: Differentiate by offering superior quality and/or
unique product features or services
• Focus: Target and serve a specific niche or market
Source: Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors;
10

 Ways to differentiate
Operational Excellence Product Leadership Customer Intimacy

Providing customers with Offering customers leading- Catering to customer
reliable products or services edge products and services needs, tailoring product
at competitive prices and that consistently enhance offerings, building close
delivered with minimal the customer’s use or relationships with
difficulty or inconvenience application of the product customers
Source: Treacy and Wiersema, The Discipline of Market Leaders

5C’S: COMPETITOR
11
ANALYSIS
• Who are you competitors?
• Firms that deliver similar products or alternative solutions to satisfy
a need
• Analysis of their business models, competitive advantages,
marketing strategies
• What is the competitive environment like?
• Understand industry dynamics and determine the long-term
attractiveness of an industry
• Where should you compete?
• Analyze both the market’s attractiveness and the firm’s capabilities
Source: Marketing Analysis Toolkit: Situation Analysis, Steenburgh & Avery, Harvard Business School,
12
13
5Cs: Competitor Analysis --
Who Are Your Competitors?
Levels Description
Brand • Products or companies in the same product

(direct) type/category, going after same segment, with same
product features
Category • Broader view of competition to include products in
(indirect) slightly different categories with similar features
and provide the same basic function
Generic • Existing substitutable product categories; products

that fulfill the same basic functional need
Competency • Companies & products in a different category with

core capabilities that can be leveraged to meet a
fundamental customer need
Source: Product Planning Essentials, Kahn, M.E. Sharpe, 2011
14
5C’S: COMPETITOR ANALYSIS
ILLUSTRATION OF BMW’S COMPETITORS
Generic Key Point:

Broaden view of
Category/indirect
competition!
Competency
Brand/direct
15
5C’s: Competitor Analysis –
Industry Competitiveness
 Analyze industry competitiveness
Porter’s Five Forces

16
5C’S: COMPETITOR ANALYSIS –
FINDING YOUR SPOT
• Where should you compete?
• Analyze the attractiveness of the market
• Industry broadly defined
• Specific segments/strategic groupings
• Analyze firm’s capability in that area
• Match between industry attractiveness and where you can
outdeliver competitors
• Competitive activity can neutralize market attractiveness
5C’S: COLLABORATOR ANALYSIS

17
• Collaborators help the firm market products; include

suppliers, distributors, retailers, key influencers
• Also need to consider complementers

• Complementers benefit from firms selling products
Source: Marketing Analysis Toolkit: Situation Analysis, Steenburgh & Avery, Harvard Business School,
5C’S: CONTEXT ANALYSIS

18
• How do environmental factors impact the business?

PESTLE Analysis
SYNTHESIS – SWOT
19
ANALYSIS
• Framework to synthesize information from 5C’s
Analysis, Porter’s Five Forces Analysis, and other
analyses
• Extracts the strategic implications for the business
• Should identify critical factors affecting the firm –

goal is not simply to list, but to prioritize and pinpoint
SYNTHESIS – SWOT
20
ANALYSIS
Strengths Weaknesses
•Unique resources, competencies, •Resources, capabilities,
capabilities superior to competition competencies, inferior to Internal
AND relevant to consumers competition Focus
•NOT a long list, but the most •Based on understanding customer
customer-relevant and competitively needs/ requirements and distinctive
distinct competencies
Opportunities Threats
•Summarizes favorable trends or •Summarizes unfavorable trends or
developments that lead to higher sales, developments that threaten sales,
profits or new business opportunities profits or limits new business External
•Describe external situation, not desired opportunities Focus
action/strategy •Recognize threats to avoid or limit
impact
21
WHAT WENT WRONG WITH MCDONALD’S?

22
• January 2003 – McDonalds announced its first-ever quarterly

loss – $343.8MM, since becoming a public company in 1965
• Same store sales in the U.S. had been falling every month for
12 straight months
23
ANALYZE MCDONALD’S
• Customer analysis
• Who are McDonald’s key targets?
• What’s the main reason they go to McDonald’s?
• Competitor analysis
• Who are the competitors?
• What’s the industry like?
• Company analysis
• What’s McDonald’s core competency?
24
DIAGNOSE THE PROBLEM

• Company
• Menu and operations complications (new rotating menu items, increased
product line complexity)
• Over-expansion jeopardized quality
• Was not delivering service; Ranked last among national quick-service
restaurants; Customers complain about “rude service, slow service,
unprofessional employees, and inaccurate service”
• Competitors
• Growing competitions
• Highly fragmented market
• Customers
• More health conscious
DRIVERS TIE TO CORE

25
COMPETENCIES
Quality Service Cleanliness Value
Improvements Improvements Improvements Improvements
• “Being Better, Not • Tracking – • Existing store rehabs • Dollar menu
Just Bigger” Mystery shopping – fresh and clean
program • ¥100 menu
• New products that • New décor
address health • Menu • EuroSaver
concerns simplification
- Careful changes (e.g.
Chicken Selects) • Invest capital in
- Premium salads reinforcing
- No more supersize
speed/accuracy
RESULTS
26
• Immediate results
U.S. Same Store Growth
2007 +5.0%
2006 +5.2%
2005 +4.4%
2004 +9.6%
2003 +6.4%
27
KEY LEARNINGS
• A thorough understanding of customers, competitors, and
company is instrumental in formulating marketing mix
decisions
• The key to successful marketing strategy is to understand

where you can win, and where you can not
• Invest to maintain competitive advantage where it’s
strategically central
• Be careful of overinvestment in:
• Areas where you won’t win competitively
• Areas that dilute your core strengths

MARK4210 Class 5 Situation Analysis Complete

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

MARK4210 Class 5 Situation Analysis Complete

Uploaded by

Copyright:

Available Formats

MARK 4210 Professor Eugene R. Raitt.

Marketing Mix Formulation

• Effective marketing strategies are based on solid

5C’S : CUSTOMER ANALYSIS

• One of the most important thing to understand is the

• Analyze direct and indirect product benefits to assess

• Distribution of consumer needs provides important input

6 5C’s: Customer Analysis

Source: Capon’s Marketing Framework, Capon, Wessex Publishing

5C’S: CUSTOMER ANALYSIS

• Types of customer values

Source: Capon’s Marketing Framework, Capon, Wessex Publishing

Understand the financial aspects

Know your organizational components

5C’ s: Company Analysis

5C’ s: Company Analysis

Operational Excellence Product Leadership Customer Intimacy

Source: Treacy and Wiersema, The Discipline of Market Leaders

Brand • Products or companies in the same product

Generic • Existing substitutable product categories; products

Competency • Companies & products in a different category with

Generic Key Point:

Porter’s Five Forces

5C’S: COLLABORATOR ANALYSIS

• Collaborators help the firm market products; include

• Also need to consider complementers

5C’S: CONTEXT ANALYSIS

• How do environmental factors impact the business?

• Extracts the strategic implications for the business

• Should identify critical factors affecting the firm –

WHAT WENT WRONG WITH MCDONALD’S?

• January 2003 – McDonalds announced its first-ever quarterly

DIAGNOSE THE PROBLEM

DRIVERS TIE TO CORE

• The key to successful marketing strategy is to understand

You might also like