Strategic Marketing Final!!!!

Reasons for Product Failures (6)

1) The better mousetrap no one wanted: tech push product with which little market demand exists. Customers do not perceive they have a real need for the tech and are not prepared to buy the innovation 2) The me-too meeting a competitive brick wall: followers failing to reconcile with the market leader's or established competitor's strengths 3) Competitors can cause failures. If a market is highly competitive, even smart innovations can be imitated and can ruin a product 4) Environmental or market ignorance: when a company fails to study the market/environment and thus fall short in one or both areas 5) The technical dog: does not work/customers don't understand due to technical issues 6) The price crunch: price is too high, often get cut out by lower-costing similar products

What are the key issues in assessing Corporate Social Responsibility (CSR) and Strategic Marketing? (5)

1) Understanding where CSR and ethics fit into strategic thinking 2) Knowing the factors driving CSR in their type of business 3) The risks involved if we get the CSR initiatives wrong 4) Know if you are developing a new business model or just defending position 5) Are we ahead or behind competitors? Does CSR create customer value in the market?

Different Levels of Product (4)

1. Core product - the basic offering 2. Expected Product - additional benefits normally provided with the core offer 3. Augmented Product - additional benefits not normally provided but serving to differentiate from competitors' offers 4. Potential Product - additional benefits not currently offered but that could be considered as ways of augmenting the offer

Different Alternative Pricing Strategies - Cost Plus Pricing, Going Rate, Perceived Value Pricing, Sealed Bids

1. Cost plus pricing - simplest approach to setting prices. Prices set at cost plus percentage markup, and reflect the costs of creating and delivering product. > Con - takes no account of value of product to customer 2. Going rate pricing - prices set on 'going rate' basis or at what others set and there is little price competition. Competition takes place on other factors, like availability, location, and convenience 3. Perceived Value pricing - pricing products at perceived value to customer, which requires lots of research. Customers put into simulated purchasing situations and behavior is observed to gauge the value they perceive in the product 4. Sealed bids - many potential suppliers can be invited to bid to supply, especially in industrial purchasing situations. First, there's a specification stage where suppliers need to demonstrate ability to supply to specification and on time (reduces number of suppliers). Then, a sealed bid which indicated the price each supplier would charge. Game theory can be used, which is a set of techniques that study situations where players choose different actions to maximize returns.

Andre Thornton discusses the importance relationships in Business success. What are his recommendations on how to conduct good business relationships? (5)

1. Listen Well 2. Communicate Well 3. Have Outstanding Knowledge of your Solution 4. Client has to trust in you and believe in you 5. Do your best for the client and care for their interest

Experience can give a company a major cost advantage. How does a company quickly improve their learning curve when competing in a new business? Name three.

A company can improve the learning curve by: 1) Hiring experienced staff 2) Thorough training 3) Consulting outside experts 4) Doing intense R&D, etc.

What is the main trap a company can run into with either over-servicing or under-servicing their customers?

*Main Issue* - alignment between service capabilities and delivery & marketing strategy: providing services to customers who don't value them and denying services to target customers because we spread our efforts over all customers

Do consumers really care about Good Causes?

- "The answer is probably that some do and some do not" - Issue is to examine which care, and whether they make a coherent target - Categories 1) commited, cause-driven purchasers (8%) 2) those who want to shop ethically but don't know how & are looking for help (30%) 3) those who feel the same but doubt their individual purchases can make difference (30%) 4) those who are completely uninterested (rest - 34%)

What advantages do Global companies have in becoming innovative and learning from others?

- "Trickle Up Innovation" - Do more with less - Start in large markets like India and China and then distribute products from their to valuable segments

Inter-market/Concentric Networks

- Alliances among firms operating in unrelated industries - At the center could be a trading company (possibly acting as marketing arm) associated with manufacturers, who have their own contractors, distributors, etc. who are involved in alliances with competitors (disadvantage) There are strong relationships in terms of resource sharing,culture, and identity, but a negative is that it may be extremely saturated by the same company

Organizational changes are becoming common place in evolving business management. What is the good news and concerns about these changes in strategy development?

- Benefits to organizational changes - functional areas are becoming more blurred and collaborative, with teams that can view operations holistically with less resentment between company divisions - Drawbacks to organizational changes - role of marketing has been challenged, so marketers have tried to defend their right to control the customer relationship

How can good "branding" strategy differentiate a product for a company?

- Brand name is an indication of what to expect from the product, or a quality statement of a value-for-money signal. - Highly defensible competitive advantage, as other competitors cannot imitate it. - Brand positioning puts the customer at the center of maintaining a hold on the marketplace and allows the brand to use an 'emotional proposition' approach. - Positioning allows a brand to establish itself in a specific spot in the mind of the consumer through associations with ideas held strongly in the consumer's mind.

The business environment is rapidly changing. How does that affect a company's strategy marketing program and its implementation? (2 types of changes)

- Changes in the business environment - economic change is accelerating, explosion in innovation, competition, manufacturing can happen almost anywhere, company actions are becoming more visible, etc. >> Effect on strategy: companies looking to be more efficient, save costs, predict changes, companies need to spot and act on more of the trends and changes than their competitors - Changes in markets - (1) customers becoming more demanding (reliable and efficient products with superior value) and (2) customers are less willing to pay a premium, (3) competition is more intense and more global

Why are competitive positioning strategy development vital for the survival of many companies in this rapidly changing business climate?

- Competitive Positioning Strategy: making choices that ensure a fit between chosen market targets and competencies and assets that a firm can use to serve those markets better than competitors. Sustainable positions involve using marketing assets and competencies of a firm! - Positioning can be based on: > > Price, Technical Quality, Service, Benefit Differentiation, Customization, and Innovation

Many conflicts traditionally exist between the marketing and sales functions within an organization. What are some of the "underpinnings" of the problem and challenge?

- Customer vs. product: focus and rewards for sales are based on customers and territories, while marketing champions products and brands - Personal relationships vs. analysis: sales may be more 'people-oriented' as relationship-focused, while marketing emphasizes aggregations of data and abstractions - Continuous daily activity vs. sporadic projects: sales is driven by constant daily tasks, while marketing is organized around longer-term projects - Field vs. office: sales is under immediate customer and budget pressures, while marketing may be removed from this environment - Results vs. process: sales lives by fast, direct results from its selling efforts, while marketing activities are less easily linked to short-term results, so may emphasize process and intermediate outcomes - Short-term orientation vs. long term: sales emphasizes month-to-month sales results, while marketing concentrates on long term competitive position

When a company tries to be a "Disruptive innovator" what are they trying to do?

- Deliver superior value to customers - Develop better business models and tackle inefficiencies > competition is now between business models, not products - key is innovation! - managers need to deviate from conventional wisdom and develop disruptive techniques to create SUSTAINABLE COMPETITIVE ADVANTAGES

4 Types of New Products - Dinosaurs, Flamingoes, Ostriches, & Pearls

- Dinosaurs: products that have missed their niche, the market has moved on and the demand for them has passed - Flamingos: products that are beautiful but unsaleable; they have great design but the cost of producing is too high, due to over-specification & customers cannot afford them - Ostrich: blind to the future. They may meet today's market needs but take no account of future changes in the market, and are not well placed to adapt to change as customer requirements and competitive pressures evolve - Pearls: constant quest of effective new product development. Will always be valuable and able to be reshaped

Why is channel and distribution strategies so important in the new marketing mix?

- Distribution strategies focus on how products are delivered to customer - Internet facilitates distribution of bit-based products whereas atom-based rely on distribution and logistics - Marketers must decide to sell through intermediaries (wholesalers/retailers) or direct to customers > Intermediaries have direct access to the customer, however retailers and wholesalers have many competing brands so they don't easily favor one brand over another > systems involved in delivering the product impact how well the salesforce can serve the customer, so CRM is important here!!

What is the role of "Market Testing" and why is it so important to get right? What competitive disadvantage might there be?

- During this, the product has passed a use test which has suggested that the product works and fulfils the need as expressed by the concept. Then, they use a range of techniques and simulate a sale with anything from carefully selected customers to a full test market in one or more regions of the country. - Like a "dress rehearsal" - Allows a company to see if their marketing plan will work (effectiveness) and to forecast product sales - Disadvantage - competitors can find out about your product testing and give them an early warning about your activities

Why is it important to actively manage strategic alliances and "stay vigilant"?

- Failing to actively manage the strategic alliance can cause poor planning, which is the main issue facing partnerships > leads to conflicts about strategy, power, opportunities, etc. - Important to recognize that some alliance benefits are temporary (many managers simply won't end bad alliances) - Vital factors to consider are (1) choice of partners, (2) network effectiveness, (3) organizational change, (4) customer service, etc.

What are some of the criticisms of CSR and the potential risks and negative outcomes of mistakes in CSR implementation?

- Focus is too heavily placed on business and society and not interdependence - Empty boasting--going green but not for the right reasons - Costs too much sometimes - Just used to boost a reputation but has no positive effects

Value Innovation & 3 Types of Company Strategies for New Products

- High-performing companies focus on how to achieve 'value innovation' through not imitating competitors or investing for competitiveness against rivals, rather they innovated in new value for customers. Should examine and predict competitive offerings through categories: 1) Settlers - these offer 'me too' value, based on equalling what their competitors do, usually in the same way but often cheaper 2) Migrators - these offer conventional value improvements over competitors e.g. in product function improvements or design 3) Pioneers - businesses that represent real value innovations (Sony Walkman, Swatch watch, etc.) Apple's iPhone is an example b/c it introduced the App Store and linked app developers and users, which made a platform deal.

What potential problems can one run into with a SAM relationship at a key account?

- Investing in Strategic Weakness: it may be unattractive to invest completely in a few major companies to do business. In other words, the business model has failed because it places all of its dependence on a few companies - Importance of balance of power: this can give all of the power to the consumer, making the supplier a weaker company. - The real buyer-seller relationship: don't rely too much on the consumer to come through for supplier, this puts extra pressure on the consumer. Understand the relationship as defined by the customer. - Risks of Dependence (clear) - Paradox of Customer Attractiveness and Competitive Intensity: an attractive customer is likely attractive to competitors, be careful - Understanding the rate of change (customers can change their mind) - SAM is not easily implemented

How does a CRM system help improve customer satisfaction?

- It delivers superior customer value by personalizing the interaction between the customer and the company - Demonstrates the company's trustworthiness and reliability - Tightens connections with the customer - Achieves the coordination of complex organizational capabilities around the customer

Why is there so much pressure for businesses' to "partner" and ally with other companies?

- It gives them an extra edge that other not partnered companies wouldn't have - It also takes some of the unwanted competition away from a company if they partner with their competition. - It can grant a company more power - Scarcer resources - Increased competition - Escalating customer expectations - Pressures from strong distributors - High levels of customer concentration - Faster rates of change in market and technologies

Why is it important for managers to understand or believe in the CSR of their company?

- Managers are the ones who implement it and make sure it continues - They are at the top of the CSR chain in terms of maintaining CSR for the RIGHT reasons, not for the sake of company rep

MasterCard sees a big opportunity with the transit system throughout the world. What advantages and disadvantages are there in forming public / private partnerships?

- MasterCard partnered with Cubic Transportation Systems, which uses traffic data to advise network operators from London to Chicago whether they need to change routes or pricing to cope with rush hour and to alert commuters of the best route options. - MasterCard can save transit system operators the cost of maintaining their own systems and handling cash. Can be good to partner with companies to reap the benefits they do, but can be bad if cultures and goals are not aligned and if one partner acts badly, it will negatively affect all parties involved.

Why should the role of Marketing in the corporation be "rethought"?

- Need to escape from the notion that marketing is solely a business function or a department in the organization. Instead, it is a process in the value chain that ensures short and long term value for the customer. - Important to recognize when defining marketing in the future that it operates at two different levels: strategic and operational > operational deals with day-to-day tasks involving market research, advertising, PR, etc. whereas strategic deals with decision-making in the market and competing well

The fifth P is often cited as PEOPLE. Importance and what is the Staffing Strategy?

- People that are happy, skilled, and motivated are much more likely to serve customers well and effectively and establish an ongoing, mutually beneficial relationship between the customer and sales company. - Staffing strategy: - 1. Job design and description - clear idea of the job roles and tasks that staff must complete - 2. Selection - choice of which staff to employ depends largely on tasks needed - 3. Training - essential to ensure proper skills are taught and delivered - 4. Appraisal - feedback to employees on performance in order to improve

How are the Four P's communicated in a SIM program?

- Product: the strategy and the plan, including the values, attitudes and behaviors needed to make them work - Price: what we are asking internal customers to 'pay'--other projects abandoned, personal and psychological adjustment to change - Promotion/Communications: media and messages to inform & persuade - Distribution: physical and social venues for delivering the product and communications

How can customers be engaged to be a part of a companies' marketing team?

- Promote via social media - Vote for new products - Agree to participate in case studies - Customer surveys

We have entered a new business phase as the "era of strategic collaboration". What is the business case for making this a necessity?

- Relationships are becoming vital to compete effectively at all - Inter-organizational relationships help in building effective marketing strategies - Allows networks to form

Proactive Cannabilization

- Someone is going to compete with you and attack the sales of your products, so you might as well do it yourself and retain the customer - Allows you to directly control the cannibalization in terms of how much and which products you are targeting

How has Commoditization of products and sophistication of customers added to the challenge of the marketing and sales function within business today?

- Sophistication of customers - Purchasing functions in organizations are strategic functions now linked to customer's strategic plans that impact profitability and costs. Strategic challenge is to match sales efforts to different parts of a portfolio of customers and to balance revenue with risk. Customers know so much more than before and have access to a lot of information, so marketing and sales need to be wary of this. - Commoditization of products - Customer organizations pursue aggressive commoditization with suppliers, which makes the only differentiating factor between products price, which is preferred for the purchaser but not the seller. Commoditization reduces purchasing to a comparison of price while sellers try to expand scope and value of offering to the customer. Often times, the salesperson/customer relationship may be where the differentiation lies, making the need for a strong salesforce that values CRM very important.

What are the success criteria needed for providing superior customer service?

- Success is primarily based on how consumers measure their experience against expectations. - The quality of service provision & the level of customer satisfaction is related to the difference between expectation and experience.

GAP Analysis

- The GAP analysis identifies a gap in satisfaction levels. The root causes of dissatisfaction can be identified and dealt with. 1) Market intelligence gap - difference between customer expectations and supplier understanding of those expectations 2) Design gap - what the supplier believes the customer expects and the service specification 3) Production gap - difference between service specification and service actually delivered 4) Perceptual gap - difference between perception of service delivery and its actual satisfaction of needs 5) Satisfaction gap

Why is "timing" so important in entering markets and being ready to compete?

- The first mover in an industry can gain cost advantages by securing prime locations, cheap or good quality raw materials, and technological leadership. - Second movers can benefit from exploiting newer technology to leapfrog first mover positions. - Aside from costs, "strategic windows" are very important as well, i.e. knowing when to market a strategy

What are companies doing to live up to an "Eco-friendly" environment in the fashion industry? What is the business logic for doing this?

- They are marketing about their eco-friendly manufacturing/products - They are investigating their supply chains to make sure that nothing unfriendly to the environment is happening - Making suppliers complete a questionnaire - Instilling a code of practice to suppliers

Both UPS and FEDEX like to use strategic alliances to manage their customers shipping and delivery needs. What competitive advantages do they provide their customers?

- They can use a number of different methods/strategies learned through different organization to have their packages delivered on time - GPS that has the coordinates of every US address - Technology that prevents mis-sorts - Making more facilities like Worldport in that they operate with few human interaction--relying on machines--making them faster - New pharmaceutical units for consumers that need medicinal goods

Why do a Customer Portfolio Analysis? Types of customers?

- This process is important because it identifies the most appropriate relationship to offer specific accounts and the choices to be made in allocating resources and evaluating risks. - The portfolio includes: 1) Direct Channels - smaller accounts with low relationship/service requirements 2) Middle Market - moderate relationship/service requirements (most conventional buyer/seller relationships) 3) Major accounts - large in supplier's terms and have high relationship/service requirements 4) Strategic accounts - close, long-term, collaborative relationships

Why are CSR programs often adopted for "defensive" reasons?

- Used to protect relationships with consumers, B2B customers, influential lobby or pressure groups (like PETA),suppliers, employees & managers - When a company is in the negative light of criticism, CSR is a good method to combat it (example of H&M after a video was released of their wool farming) >>>This is warned against because it only works as a short-term public relations action and has little social impact or difference

Venture Teams & Spin Outs

- Venture teams - mostly associated with small firms that have few people and no entrenched departments. It should have a mix of people w/ diff functional skills, not just specialists. Allows people to focus all their effort on one project temporarily. - Spin outs - completely detached from the parent company. Big companies use this option to support very risky product innovation projects that do not currently fit the corporation's core business. Outside capital is sometimes bought; the venture is sold off for an equity stake in the new start up firm. Not logical for small firms.

Drawbacks of Cost Driver Strategies

- can only be one cost leader - cost leading doesn't give customers reason to buy; they don't care about your costs, it should be translated to low prices in the marketplace - cost advantages can be difficult to sustain and can be easily attacked by competition

How does a company manage and exceed customer expectations? Wow them! (3 things)

1) Ensure promises reflect reality 2) Place a premium on reliability 3) Communicate with customers - to encourage tolerance and to understand expectations

Defensive strategies (3)

1) Flanking - aggressor seeks to concentrate strength against weaknesses of defender, often using the element of surprise to gain the upper hand. Requires prediction of competitor strategies and likely strike positions and strengthening of the flanks without weakening elsewhere in the company. defend the flanks against attack by extending the defenses to cover peripheral weaknesses 2) Pre-emptive Strike - attack the competition before they attack you. Can involve an actual attack on the competition or merely a signal of intention to fight and willingness to commit the resources to defend against it. 3) Counter-offensive - identify the aggressor's vulnerable spots and strike hard. Most effective where aggressor is vulnerable through overstretching resources > creates weak underbelly (hehe) that can be exploited for defensive purposes.

Competitive Confrontation Strategies (3)

1) Frontal - attack where the competition is strong and rely on outweighing them for victory, all out attack on opponent. For success, it requires sufficient resources and a strength advantage over competitors being attacked 2) Flanking - identify less obvious lines of attack. Attack the weak points in the competitor's defense. Done through attacking geographic regions when defender is weak or attacking underserved competitor segments. Strategy requires identifying the weaknesses and inability or unwillingness of that competitor to serve particular segments of the market. 3) Encirclement - Cut off the competitor from critical resources and support, access to supply and access to market. Two approaches: first is to attempt to isolate competitor from supply or customers that they need and second is to offer an all-around better product/service

Types of network prototypes (4)

1) Hollow network - transaction based and is associated with highly volatile environments. The core organization draws heavily on other organizations to satisfy customers (hence hollow). Example - Monster.com, which connects job seekers with employers and offers a buffer against risks in a changing environment 2) Flexible network - also in volatile environments but is characteriZed by inter-organiZational links which are collaborative and long term, a network coordinator determines customer needs and establishes sources of supply to satisfy them Example could be Uber, where they promote and defend service and provide smartphone software but use a network of external partners to provide taxi 3) Value-added network - in less volatile environments and based mainly on transactional relationships between network members. Example - clothing manufacture, furniture - situations where complex technologies and customized products aren't required 4) Virtual network - has little volatility, core organization seeks to establish relationships with other organizations--seeks to achieve adaptability to meet the needs of segmented markets through long-term partnerships rather than internal investment

6 Types of Buyers when an Innovation Appears

1) Innovators - first to adopt new technology/product. Wish to be viewed as trendy and up to date. The novelty value of the product drives their adoption. 2) Early Adopters - similar to innovators but demonstrate a more visionary reason for adopting the new technology. They see significant advantages for adoption and opportunities to improve effectiveness. 3) Early Majority - more pragmatic than early adopters, less likely to see ways of revolutionizing the market and more likely to see incremental possibilities for improvement. Often efficiency-driven. 4) Late Majority - described as 'conservatives' who enter a market or adopt a technology because others in the market have done it and fear being left behind. More reluctant in adoption and in greater need of support and direct in use of technology. Confused about how technology/product will benefit them and like to wait until it's been tried and tested. 5) Laggards - skeptics who don't see potential for new technology, will resist adoption, but may eventually be forced into it because everyone around them has done so 6) Sloths - very last adopters of new technologies, often trying to avoid it. Can change the way they operate to isolate themselves from innovations.

5 characteristics of a Strategic Sales Organization - the five I's - Infrastructure, Involvement, Intelligence, Internal marketing and Integration

1) Involvement - placing the sales organization in the center of the business; aligning sales with strategic direction 2) Intelligence - market sensing and interpretation for added value; building customer knowledge 3) Integration - working across functional boundaries 4) Internal marketing - selling the customer to the company 5) Infrastructure - realigning salesforce structures and processes around strategy

Blocks that occur during Innovation (5)

1) Perceptual blocks: prevent the person from perceiving clearly either the problem itself or the information needed to solve the problem 2) Cultural blocks: acquired as a result of exposure to a given set of cultural values or patterns 3) Environmental blocks: immediate social or physical environmental blocks that are linked to cultural barriers 4) Emotional blocks: interfere w/ the freedom with which we explore and play with ideas, and prevent us from communicating them effectively to others 5) Intellectual and expressive blocks: intellectual capabilities are limited and verbal/writing skills needed to communitied ideas are deficient

Name three or four obstacles to implementation of effective strategy execution.

1) Poor or vague strategy 2) Not having guidelines or a model to guide strategy implementation efforts 3) Poor or inadequate information sharing among individuals/units responsible for strategy execution 4) Trying to execute a strategy that conflicts with the existing power structure

Different Stages of Product Life Cycle

1) Pre-launch - focus on R&D and gear up production to prepare for launch, need to identify early adopters of product and develop key sales messages demonstrating the benefits relative to customer's current solution. High levels of cost before returns. 2) Launch - major opportunity to shout loudly about benefits. Take the form of explaining the benefits over and above those from their current product. Good opportunities for creative communications with prospective customers (including PR - huge here). High costs and sales not yet realized. 3) Introduction - crunch time for new product, many don't get beyond this phase. Sales take off but costs are high. Competition will enter. 4) Growth - the most exciting phase, sales grow quickly and returns outstrip costs. Competition grows, more differentiation and segmentation, costs are high for R&D. Returns peak here. 5) Maturity - growth slows and majority of users have entered. Fierce competition, price wars, profit margins squeezed, costs increase with R&D. 6) Decline - profits squeezed as next generation of products take over and eventual death is near. ***Turning points - Transitions from one stage to another. First is the one from intro to growth, where a product does not want to be left behind as market takes off. Second is from growth to maturity, and a product doesn't want to be left with high costs and over-capacity. Lastly, the transition from steady state maturity to decline can leave firms attached to old technology.***

6 steps in a customer relationship ladder

1) Prospect - target customer (identifying who this is) 2) Customer - customer catching 3) Client - shifts to securing a longer term, ongoing relationship, client is more individual and does business on repeat basis 4) Supporter - convert clients into supporters, or those who have positive feelings toward the supplier 5) Advocate - hopefully convert supporter to an advocate, someone who actively recommends the supplier to others 6) Partner - top of ladder where supplier and buyer are working together for mutual benefit - On the first 2-3 the emphasis is placed on winning new customers - On the Last 4 the emphasis is placed on developing and enhancing relationships

Name a few areas of the perceived roles of internal communications at a company (4)

1) Team building (educate employees about diversity of organisation, assist cooperation) 2) Damage Control (prevent wrong communication, suppress bad news, counter negativity) 3) Morale Builders (Build confidence, increase motivation) 4) Goal-setting (help organization steer in a coordinated direction, provide focus, generate support)

How does collaboration help companies navigate through complexity and minimize risk? (3)

Collaboration helps to minimize risk and complexity through: 1) Meet escalating customer demands 2) Become more global 3) Adapt to blurring market boundaries.

Customer Delight

Customers get more from relationship (satisfaction and benefit-wise) than they were originally expecting or looking for - merely satisfying customers is not enough reason for them to stay loyal and become advocates, need to execute customer delight - results in long lasting and voluntary support that is mutually beneficial - may be necessary to go beyond what's expected and deliver even greater value to customers to retain customers - high priority needs to be given to excellent customer service

IDEO uses a design and innovation approach called "Deep Dive" thinking. What is it and when is it most effective?

Deep-Dive™ is the name of a technique used to rapidly immerse a group or team into a situation for problem-solving or idea creation. This approach is often used for brainstorming product or process development.

What should be the scope of a strategic internal marketing program (SIM)? (4)

Different 'types' of internal marketing: SIAI - Steph Is In America 1) Internal marketing & service quality, 2) internal marketing & internal communications, 3) internal marketing & adoptions of innovations, 4) internal marketing as the implementation strategy for marketing plans

What are the myths surrounding strategic implementation of a marketing plan? (5)

EPECE - Emily Prefers Eating Canned Eggs 1) Execution equals alignment - companies are good at cascading goals down the organization but less so at managing coordination across the units 2) Performance culture drives execution - in reality execution is not just about performance-orientation: a culture that supports execution must recognise and reward other things as well, such as agility, teamwork & ambition 3) Execution means sticking to the plan - employees are less skilled and ready for uncontrollable circumstances 4) Communication Equals Understanding - often times employees actually don't get it, even when a manager thinks they do 5) Execution should be top-driven - distributed leaders are better, middle managers actually represent leadership to most employees

Why did Geely purchase Volvo? What branding image did Volvo bring to the market?

Geely - Chinese car maker - Volvo's footprint should be projected across the world, and its reputation for building safe cars could help its business in China as safety becomes an increasing priority in the world's largest car market. Geely is also an expert in designing electric cars that are edgy and fashionable, which is the movement that Volvo is trying out.

Internet Pioneer vs. Internet Pragmatist

Internet Pioneer - have set up radically new types of business to exploit the benefits of new technology to do business in very different ways; these 'omega-level' firms have gathered info on customer preferences and to tailor products to specific needs of customers >>> Example: eBay, who positioned itself solely from WOM from customers and created a way where buyers attracted sellers, which in turn attracted more buyers Internet Pragmatist - businesses that have embraced the opportunities of the Internet to enhance their existing business models; used the Internet to enhance the services already offered to customers, reduce costs, and not completely throw out existing business models - many pragmatists are aligned with the old economy and are slow to adjust to technology >>> Example: Dell - uses online ordering to enhance direct marketing operations, FedEx uses technology to enable personalized tracking of customer packages

Position Defense

Involves making barriers around the company and its offerings to shut out competitors from copying or entering the market. Most effective when the company differentiates its offerings from competitors on noncopyable grounds. For established leaders, brand name and reputation are the best way to hold positioning

Stealth positioning

Involves shifting to a different product category in a covert way, perhaps when there is prejudice about a product or the company which needs to be overcome. Not the same as deceit and can backfire if customers think they are being cheated.

Reverse positioning

Involves stripping down the augmented product to its core and then seeking new ways to differentiate. The strategy recognizes that some firms add so many additional features that they become the expected instead of the expectation that differentiates.

What are the key issues in SCM? (6)

Issues: PNSSMD 1) Priorities for identifying strategic sales capabilities - test out the reasons why sales has become strategic 2) New and emerging competitive role for sales - consider what companies want from sales in modern markets 3) The strategic sales organization - evaluate what these pressures create in a new type of sales organization 4) Strategic customer management tasks - focus on the capabilities needed for strategic customer management 5) Managing the customer portfolio - making investment decisions around customer assets 6) Dealing with dominant customers - the special case of the powerful customer

"Balance Scorecard" is used to manage a Strategic Alliance. What is it and how is it used?

It is an effective way of keeping track of each of the companies within the alliance and making sure that they are each using the same tactics/rules It serves as a template for establishing and clarifying performance criteria for an alliance and evaluating performance, too.

Dyson was hiring a lot of new engineers for their company. What was their strategy and how does it help their brand?

James Dyson wanted to make a better vacuum using 'cyclone technology." Market forces pushed it along and Japan was more willing to buy than the U.S. He was relentless and built hundreds of prototypes, kept testing, and utilized failure to get to success.

How can good CSR provide a company a key Strategic Advantage? (4)

Moral obligation, sustainability, licence to operate and reputation are 4 main reasons to have CSR--makes you a better company in the eyes of the consumer

"Contract" a business

Move to a more defensible position. Requires giving up untenable ground to reduce outstretching and allow concentration on the core business that can be defended.

How does Nespresso differentiate itself through its' Distribution system?

Nespresso emphasizes its aspirational luxury position with its exclusive Nespresso boutiques and concessions in top department stores as well as online. It allows them to fully control the customer experience.

5 levels of collaboration and inter-organizational commitment

OPSJO-Our Pet Shadow Jumps Often 1) Outsourcing - purchasing of goods/services, possibly long term with a close buyer-seller relationship 2) Partnership - Coordinated activities between companies, possibly long term 3) Strategic Alliance - Formal agreement between companies to collab & act jointly 4) Joint Venture - shared ownership in an operation w/ a collaborator 5) Ownership - full ownership and integration of an activity by a party

Why create a "Learning Organization" at your company?

Organizational learning can help respond to and act on opportunities in the market and learning faster than competitors many be the only real source of sustainable competitive advantage

What are the 6 pricing considerations that must be taken into account when setting price levels and strategies?

PPECCD - Peter Prefers Eating Chocolate Cake Daily 1. Production Costs - Simplest and most common way to set prices is at cost plus a percentage markup Ensures level of profitability and predictability and that products aren't sold below cost 2. Price elasticity of demand - Extent to which demand will vary at different price levels > luxury good are highly price elastic (changes in price affect demand) and others such as essentials are not elastic (necessities) 3. Economic value to the Customer (EVC) - Value of product to customer over its lifetime gives a ceiling above which prices would be unacceptable to customers 4. Competitor Price Levels - Firms can price higher than competitors (to signal better quality), at similar prices (and compete on other features), or at lower prices (and compete primarily on price) 5. Corporate objectives - Are the objectives to grow the market rapidly (low price), to harvest (which might argue for high prices), or maximize profit (marginal cost pricing)? 6. Desired competitive positioning - Price charged can signal to market the quality and reliability of product (Bose headphones vs. standard ones)

What risks are there in strategic alliance formation?

PTSDCC - PTSD Causes Cancer (think of this acronym as harmful, just like these potential risks) - Power--relative dependence and power w/in a network, in terms of whether the position is acceptable or not - Commitment and interdependence--what do we need to do to make sure every company is actively behind the alliance and that exchange of information is safe - Trust - each party should give up some influence or control and be vulnerable - Social norms--making sure certain social behaviors are in order: solidarity, mutuality (common good), flexibility, role integrity, conflict handling - Damage by association--if one goes poorly the whole alliance may be at risk (performance in terms of competitive behavior or social responsibility) - Changing strategic priorities - when an ally becomes a rival because its strategies change over time, so an alliance may not work anymore

How do companies use a Value Chain Analysis to develop strategic advantage?

Partnering with different companies at different stages of the value chain - having each company be responsible for a different part of the process, e.g. Google and its partnership with Android and other companies to manufacture and develop the distinct aspects of the phone (applications, operations, etc.) so the process is more controlled and focused for each company

Nestle' is using a form of Strategic Relationship marketing in the Congo. What problems arose in their implementation of their Strategy?

Poor roads, legal system, poor people, and theft (which has caused delivery of cargo to take way longer than it should), access to some areas is prohibited

The 5 Uniqueness Drivers

Pricing Differentiation Product Distribution Brand Promotional

A great tool to differentiate a product is through creative Marketing mix strategies. How can the use of the Public Relations department improve Marketing communications?

Public relations involves creating relationships with the media and using those to gain positive exposure. Press releases and interview with key executives on important topics can help promote the company in a credible way. PR is cheaper than media advertising and is more credible because they are reports published by independent journalists.

What is the advantage of a SAM approach (Strategic Account Management) with your best and dominant customers?

SAM works for larger and dominant customers because it forms a certain partnership with these customers and allows for effective and thorough management of the accounts with them - allows focus on more of a collaborative partnership rather than a rigid, formal buyer-seller relationship

Sensory Marketing and examples

Sensory Marketing - It uses the senses to relate with customers on an emotional level. Brands can forge emotional associations in the customers' minds by appealing to their senses - Examples - McDonald's puts secents in restaurants to enhance dining experience, Lynx (deodorant) has perfected the sound its aerosol makes and Singapore Airlines has a unified scent worn by employees and in the aircrafts

Mobile Defense

Shift resources to where they are needed. Involves creating a 'flexible response capability' to enable the defender to shift the ground that is being defended in response to threats and opportunities. Achieved through willingness to update and improve the company's offerings to the marketplace continuously. Essential in markets where technology and/or customer wants and need are changing rapidly

Perverse Customer

Sophisticated customer who rejects traditional marketing messages due to loss of confidence in institutions and trust in businesses and professionals > take positive delight in destroying business' attempt to change their behavior and being awkward and changing the rules >> Examples: Cigarettes - anti-smoking ads from the gov't had led people to smoke more often and Medicine - customers who hate waiting to see a doctor can go to WellnessFX to get a diagnostic test or medicine 23andMe and Privacy - people submitting false data or ignoring requests for personal info because they are so annoyed

Strategic drift and "dilution" are two problems that occur in trying to implement marketing strategy. What are they?

Strategic drift - a lack of focus on where the strategy should end up, leading to failure to reach it Dilution - an absence of a strong drive behind the strategy meaning the managers give more priority to operational decisions than strategic goals

Name 4 ways a company can "sustain" competitive advantage

TPCB - Trevor Picks Catelyn's Boogers 1. Unique and valued products - made through scarce and valuable resources, and uniqueness can come from employing superior talent, better technology, etc. 2. Clear, tight definition of target markets - constant monitoring of and dialogue with customers and understanding exactly who they are and how to access them 3. Enhance customer linkages - creating closer bonds with customers through better service can help make a more defensible position in the market. Also, creating high switching costs (so buyers tend to stray from switching suppliers or customers) can enhance customer linkages 4. Established brand and company credibility - brand and company reputation are some of the most defensible assets of a company. Customers find security in the intangible brand essence.

Why are "Internal Marketing" programs vital for the success of a strategic branding and marketing program implementation?

The internal marketing process might include the following activities: - Gaining the support of key decision makers for our plans - Changing some of the attitudes and behavior of employees so plans work effectively - Winning commitment to making the plan work and of those who are needed - Changes in culture to move from the old to the new - 'the way we need to do things to be successful'

Skanska declared that they wanted to be the world's greenest construction company. Is this a legitimate goal and how does it affect their business strategy?

The issues associated with this goal are: - Higher costs to maintain this standard, which cause them to charge higher prices - Need to focus on value proposition and value of "green" instead of price - Change playing field so it gives their value proposition an advantage - Need to prove they are better than competitors instead of just making claims

In manufacturing, full capacity utilization can be a measure of great return on investment. Why do so many companies avoid industries with wide fluctuation in demand?

The relationship between utilization of a good and ROI is highly positive, and more so for smaller companies than for large ones. Companies avoid industries with fluctuations in demand because major discontinuities and changes in utilization can add significantly to costs, such as the costs to plan production and inventory.

Why do you think that a growing number of accounts are making appointments such as Strategic Customer Manager?

There is now an increasing priority for a strategic perspective on the management of customer relationships. - Focuses on (1) strategic mgmt of customer portfolio (investment in each customer) and (2) mgmt of strategic customers (building relationships with dominant customers)

When introducing new products there is often a "chasm" between Early adopters and the majority of buyers. What causes this chasm and how is it created?

This chasm is the transition from a technology for enthusiasts and visionaries to a technology for the pragmatists. The success of the innovation, although bolstered by the enthusiasm of the early adopters and innovators, depends on the pragmatists to determine its productivity and process enhancements.

When would a company use a "loss leader" for their pricing policy?

Used by retailers and supplier as a means of attracting customers into their stores, websites, etc. These are products sold below cost for promotional purposes. Once customers have been attracted, the retailer will try to sell other market offerings at profit. Also used when the lifetime cost of a product is greater than the initial purchase price.

What are "value signals" and how can they help a company compete?

Value signals: building on reputation, image, presence, appearance, and pricing of the product. - They can help enhance perceived differentiation.

Breakaway positioning

Where a product is deliberately moved from one product category to another in order to gain a new lease of life beyond the existing position it holds in its current product life cycle.

In his book, AZ of Account Management, Phil Jesson recommends that it is wise to look at the profitability of your key customers and the cost to serve them. Do you agree, even though it might mean that you might have to fire some customers?

Yes, as Jesson puts it, it is much better to focus on generating extra revenue from your existing customers that are profitable rather than go after more customers that aren't as much. It is necessary to ensure the longevity of your company. You should only work with customers that "fit your business profile."

Psychological Pricing

pricing just beneath psychological barriers (e.g. $2.99 rather than $3) - Assumption is that customers have a psychological price threshold and will group prices in broad brands for comparison purposes

What are Harvesting strategies?

used to minimize costs, maximize revenues, and take cash out for other projects. At some stage in their life, most products/services have no long-term future. Can be pursued to max out on returns from product before death or withdrawal from market. Used to "reduce investment in a business entity in the hope of cutting costs/improving cash flow."

When are "Guerilla Tactics" best used in trying to compete on offense against a business rival?

used to weaken the competitor through attrition and surprise attacks. Employed primarily as spoiling activities to weaken the competition. Used by a weaker attacker on a stronger defender. Examples: price cuts, alliances, legal manoeuvres. Used to soften competitor before GOING IN FOR THE KILL MUHAHAHAHA.