MaRkEtInG 443 eXaM oNe
Customer value mapping
-Customer Value = Perceived Quality (benefits) vs. Perceived Price (costs) -Decompose each into most important drivers -Rate value proposition alternatives relative to competitors, substitutes, etc. -Map existing value proposition positions and potential "white spaces"
Know how to calculate Net Promoter Score as shown in the in-class exercise (including know how to define detractors, passives and promoters on a 0-10 scale).
Ask your customer a simple Q: 1. How likely is it that you would recommend us to a friend or colleague? ( on a scale from 0 to 10) 2. Categorize customers based on their answers 3. Calculate your Net Promoter score. nps = % of promo - % of detractors
How to select a an attractive market segment
Consider the segments attractiveness; -Current size, growth rate -Trends like demographics, political, tech Consider the firm's strengths & capabilities; -Relative to segment's needs (Are there unmet needs we can satisfy? Synergies with our other product offerings?) -Relative to competitive situations (How well can we differentiate from our competitors? Threat of new entrants? Competitive rivalry?)
Competitor Identification
1. Strategic Group Analysis (Managers' View) -Pursue similar competitive strategies -Have similar characteristics -Have similar assets and competencies 2. Customer Choice Analysis (Customers' View) Group Companies based on... -How customers make choices between different products -These choices could span different product categories
What's the difference between current vs. potential competitors? Examples?
Market expansion Product expansion Backward integration Forward integration Merger/alliance of resources/capabilities
What are the common variables used to segment customers in a market? Examples of each?
Geographic Psychographic Demographic Behavioral Need (benefit)
Product Market Investment strategies
Includes: Market Penetrations Product expansion(development) Market Expansion Diversification
5 forces analysis
Threat of new entry threats of Rivalry Increased bargaining power of supplier increased bargaining power of buyers Threat of substitutes
break-even analysis
a method of determining what sales volume must be reached before total revenue equals total costs
framework for identifying competitive threats
current A B potential C D Direct indirect
What are the key factors to consider in calculating a customer's life time value?
m = gross margin, r = retention rate, d = discount rate (= cost of capital) AC=acquisition cost
customer value mapping (perceptual mapping)
this is an example
PESTEL model
Political Economic Sociocultural Technology Environmental Legal
What are the four levels/types of strategy?
Porter's Generic Business Strategies Mile and Snow (1978)'s Marketing Strategies Boston Consulting Group (BCG) Matrix Product Mix Strategies Product-Market Investment Strategies
Customer segmentation
Relates to Target Marketing & Positioning -Target Marketing: Evaluate the relative attractiveness of various segments. -Positioning: Design product offerings and marketing programs targeted toward specific segment(s) compared with competitors`
Blue Ocean Strategy
Represents all the market opportunities NOT in existence -Defined by untapped market space, demand creation and the opportunity for highly profitable growth -While some are created well beyond the existing industry boundaries, most are created from within the Red Oceans by expanding the market or industry boundaries
What are some essential elements of a strategy
Strategy is the creation of a unique and valuable position, involving a different set of activities." Four dimensions define a business strategy: the product-market investment strategy, the customer value proposition, assets and competencies, and functional strategies and programs. The first specifies where to compete, and the remaining three indicate how to compete to win." Goal Setting Scope Sustainable Competitive Advantage Match between firm and marketplace Resources and Competences Implementation Levels of Strategy
Why do "very satisfied" customers generate more profits than "satisfied" customers?
"Very satisfied" customers not only buy more, they often buy higher-margin products and services, which results in a higher percent margin on total sales.
What's the difference between direct vs. indirect competitors? Examples?
-Direct competitors: Target similar customers to the firm by offering similar benefits and values with similar products, technology and/or business model. -Indirect competitors: Targets the same customer with similar benefits and values, but have different products, technology and/or business models.
What are the determinants of the threat of new entrants in Porter's Five forces model?
Dependent on barriers to entry such as: -economies of scale -capital requirements of entry -access to supply or distribution channels -customer or supplier loyalty -experience -expected retaliation -legislation or government action -differentiation
How is a marketing strategy different from a business strategy?
It is different
Miles and Snow
Prospectors - continuously seek to locate and exploit new product and market opportunities Defenders - seal off a portion of the total market to create a stable set of products and customers Analyzers - combining the strengths of both the Prospector and Defender to cautiously follow Prospectors into new product-market domains while protecting a stable set of products and customers Reactor - does not have a consistent response or strategy to the entrepreneurial problem
Customer Segmentation
The same customer/market segment: (1) has common needs (2) will respond similarly to a distinct offer or marketing mix.
How to choose a good segment market for targeting?
Who are the biggest customers? The most profitable? The most attractive potential customers?
