Understanding the

1
Understanding the organisational resource
base class
9
2
Figure 6.1 Understanding the organisational
resource base
3
Figure 6.2 Value disciplines
4
Figure 6.3 Competitive positioning
5
Figure 6.4 Marketing resources
6
Figure 6.5 Marketing assets
7
Table 6.1 The top ten brand names Source
Interbrand (1996, 2001, 2006)
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Figure 6.6 Marketing capabilities
9
Figure 6.7 Dynamic marketing capabilities
10
Figure 6.8 The resource portfolio
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Figure 6.9 Developing and exploiting
resources Source Adapted from Homel and
Prahalad, 1994
12
The distinction between competitive positioning
and market segmentation

• Competitive positioning
• Market segmentation
• Customer needs

13
Figure 8.1 Competitive positioning and market
segmentation
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Figure 8.2 Stages in segmentation and positioning
15
Principle of competitive positioning

• Positioning is the act of designing the
  companys offering and image so that they
  occupying a meaningful and distinctive position
  in the target customers minds.

16
Figure 8.3 Positioning risks and errors
17
Segmenting consumer markets

• Background customer characteristic
• Customer attitudes
• Customer behavior

18
Figure 8.4 Background customer characteristics
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Table 8.1 UK socio-economic classification scheme
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Table 8.2 The Warner index of status
characteristics
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Table 8.3 Stages of the family life cycle
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Table 8.4 ACORN a classification of
residential neighbourhoods
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Background customer characteristics for
segmenting markets

• Demographic characteristics
• Gender
• Age
• Geographic location
• Subculture
• Socio-economic characteristics
• Consumer life cycle
• Personality characteristics
• Lifestyle characteristics

24
Customer attitudinal characteristics for
segmenting markets

• Benefit segmentation
• Perception and preference

25
Customer behavioral characteristics for
segmenting markets

• Purchase behavior
• Innovators
• Brand loyalty
• Consumption behavior
• Communication behavior
• Relationship-seeking characteristics
• Relationship seekers
• Relationship exploiters
• Loyal Buyers
• Arms-length transaction customer

26
Segmenting business markets

• Background company characteristics
• Attitudinal characteristics
• Behavioral characteristics

27
Segmenting business markets

• Background company characteristics
• Industry type
• Company size
• Customer location
• Company technology
• Customer capabilities
• Purchasing organization
• Power structure
• Purchasing policies
• Product application

28
Segmenting business markets

• Segment business markets on the basis of the
  benefits being sought by the purchasers

29
Segmenting business markets

• Behavior Characteristics
• Buyer-seller similarity
• Buyer motivation
• Buyer risk perception

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Figure 9.1 A model for segmentation
research Source Based on Maier and Saunders
(1990)
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Table 9.1 Clustering methods Source Based on
Punj and Stewart (1983)
32
Figure 9.2 Clustering of objects in
two-dimensional space
33
Figure 9.3 Modelling store images through the
use of semantic scales
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Figure 9.4 The positioning research process
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Figure 9.5 Individual similarity matrix of
leisure facilities
36
Figure 9.6 Perceptual map of leisure centres
37
Figure 9.7 Perceptual map of leisure centres
with dimensions identified
38

Figure 9.8 Perceptual map of leisure centres
with dimensions identified and segment ideal
locations
39
Implementing market segmentation

• The scope and purpose of market segmentation
• Understand of the market
• Positioning study
• Marketing program decisions in new product
  launch, pricing, advertising and distribution

40
Figure 8.5 Levels of segmentation
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Figure 8.6 Market segment attractiveness and
organisational resource strength
42
Selecting Market Targets
43
Figure 10.1 Market attractiveness and
competitive position Source Adapted from Piercy
(1997)
44
Figure 10.5 Target market selection
45
Market attractiveness and competitive position

• Areas where we can take a strong and secure
  competitive position, but where the market simply
  does not deliver the benefits that the company
  needs

• Peripheral business

46
Market attractiveness and competitive position

• Areas where the market appears very attractive to
  us, but can only ever hold a weak position

• Illusion business

47
Market attractiveness and competitive position

• Market that are not attractive and where we can
  only take an also-ran position

• Dead-end business

48
Market attractiveness and competitive position

• Markets offering the benefits we want, where
• we should take a strong position

• Core Business

49
Figure 10.2 The productcustomer matrix
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Figure 10.3 Factors affecting market segment
attractiveness
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Figure 10.4 Factors affecting business strength
52
Target market selection
Market segment attractiveness
Unattractive Average Attractive
Weak
Current and potential company strengths in
serving the segment
Average
Strong
53
Figure 10.6 Evaluating market targets for a
hypothetical company
54
Evaluating market targets for a hypothetical
company
Market segment attractiveness
Unattractive Average Attractive
3
Weak
7
Current and potential company strengths in
serving the segment
6
2
Average
5
4
1
Strong
55
Figure 10.7 Alternative marketing strategies
56
Possible/Functional Strategies

• Functional strategies (or operational strategies)
  are the short-term goal-directed decisions and
  actions of the organizations various functional
  areas.
• Six functional strategy areas
• Marketing
• Research and development
• Production-operations-manufacturing
• Human resource management
• Financial-accounting
• Information systems-technology

57
Possible POM Strategies
Table 5-1 Possible Production-Operations
Management Strategies
Production Process Strategies

Process focused Product focused
Capacity Strategies

Size of facility Efficient use
Location Strategies

Location selection
58
Possible Production-Operations Management
Strategies
Work Design Strategies

Job specialization Job enlargement Ergonomic
s Work methods Motivation-incentive systems
59
Possible Production-Operations Management
Strategies
Layout Strategies

Fixed position Process oriented Office Ret
ail-service Warehouse
60
Possible Production-Operations Management
Strategies
Production-Operations Management Strategies

Just-in-time systems Purchasing management
procedures Inventory management
systems Materials requirement planning
techniques Short-term scheduling
techniques Project management
procedures Maintenance management
61
Possible Marketing Strategies
Segmentation Strategies

Geographic - nations , regions, provinces,
cities Demographic - age, family size,
gender, income, education Psychographic -
lifestyle, personality Behavioral -
knowledge, attitude, use of, response to a product

62
Evaluating and Selecting the Market Segments

• Single-segment concentration
• Choose a single segment
• Selective specialization
• Selects a number of segments
• Product specialization
• Certain product that can sells to several
  segments
• Market specialization
• Concentrates on serving many needs of particular
  group
• Full Market Coverage
• Serve all customer groups with all the products
  they might need

63
Possible Marketing Strategies (selected)
Differentiation Strategies

Product itself Services Personnel Image
64
Possible Marketing Strategies
Marketing Mix Strategies

Product
New-product development Product
line Brand Packaging-labeling
65
Possible Marketing Strategies
Marketing Mix Strategies (continued)


Pricing
Markup pricing - Add standard markup to
the product cost Target-Return pricing -
Determine the price that would yield its target
rate of return Perceived-value pricing -
Price the product according to the customers
perceive value, not the sellers
cost Value pricing - Charge fairly low
price for a high quality offering Going Rate
pricing - Bases its price largely on
competitors prices Price Discounts-allowances
- Cash discount, Quantity, Seasonal Promoti
onal pricing - Loss leader pricing , special
event pricing Customer Segment pricing -
Different customer groups are charged different
prices for the same product or service
66
Possible Marketing Strategies
Marketing Mix Strategies (continued)


Promoting
Advertising Billboards Point-of
purchase displays Symbols and
logos Packaging inserts Sales
promotion Public relations Personal
selling Direct marketing
67
Possible Marketing Strategies
Marketing Mix Strategies (continued)

Place
Channel choice Market logistics Invent
ory Transportation modes-carriers
68
Possible Human Resource Management Strategies
Work Flows

Organize for efficiency or innovation Organize
for control or flexibility Use specialized or
broad job categories Use detailed or loose work
planning
Staffing

Use internal or external recruitment Who
makes hiring decision Whats important in
hiring Formal or informal approach
69
Possible Human Resource Management Strategies
Training and Development

Buy or develop skills Individual or
team-based training On-the-job or external
training Job-specific or generic training
Compensation

Fixed-pay or variable pay system Job-based or
individual pay Seniority-based or
performance-based system Centralize or
decentralize pay decisions
70
Possible Human Resource Management Strategies
Employee and Labor Relations

Top-down or bottom-up communications Interacti
ons with labor unions Adversarial or
cooperative relationship
Employee Rights

Use discipline as control or learning Protect
organizations or employees rights Formal or
informal ethics program
71
Possible Research and Development Strategies
RD Emphasis

Basic scientific research Product
development Process development
RD Timing

First mover Follower
72
First Mover Advantages-Disadvantages
First Mover
Advantages Disadvantages

Reputation for being innovative and industry
leader Cost and learning benefits resulting from
moving along experience curve first Control over
scarce assets preventing competitors from having
access to them Opportunity to begin building
customer relationships and customer loyalty
Uncertain over exact direction technology and
market will go Risk of competitors imitating
innovations (free-rider effect) Financial and
strategic risks High development costs
73
Possible Information Systems Strategies
System Technology

Manual-based, computer-based, combination
74
Possible Financial-Accounting Strategies
Evaluating Financial Performance

How often How much analysis
Financial Forecasting, Planning, and Budgeting

Percent of sales forecast Sustainable rate of
growth model Types of budgets used
Financing Mix

Financial structure-capital structure Short-te
rm versus long-term fund sources Permanent or
long-term sources