Chapter 1 Flashcards
What is the key to achieve excellence?
- strategy
2. execution
Home Depot
- new vision to serve customers by empowering them to complete jobs on their own
- generated a lot of success
- when execution faltered, the company dropped 24% despite a booming construction period
marketing strategy
simple value proposition that is based on a deep understanding of customers
Dollar General
- sells quality products at low price to low fixed-income customers
- locations are in small-towns and low-income urban areas
- have success because of focus on the marketing strategy
K-Mart
- struggled due to lack of marketing strategy
- despite having a low-scale customer focus, decided to sell upscale items (Martha Stewart collab) that alienated current customer base
- tried to compete with Walmart on low prices and eventually filed for bankruptcy
Why are marketing strategies executed poorly?
- employees are responsible for exectution, so poor training and engagement will lead to poor execution
Marketing
a disciplined process used bye organizations to solve business problems
Problems solved by marketing (for-profit)
- low-priced competitors are flooding the marketplace with cheap goods
- difficult to differentiate goods from competitors
- how to generate more revenue?
- manage explosion into media channels
- customers are becoming more sophisticated and price sensitive
- how to build a customer-focused organization
Problems solved by marketing (not-for profit)
- differentiate ourselves
- increase awareness of our brand
- increase funding from donors
- build partnerships with for-profit organizations
- motivate volunteers
Snap-On Tools
- example of marketing organization
- sells tools to the auto-mechanic
- includes premium materials and charges a price premium (10% more)
- builds relationships with the mechanics through dealers `
Marketing Process Steps
- Understand Customers
- Create Customer Value
- Deliver Customer Value
- Manage Customer Value
Step #1: Marketing Process
- Understand Customers
- customer needs
- customer segments
- target customer
marketing segmentation
recognizing different sets of groups of customers based on their needs
- winning organizations know they cannot serve all needs; they need to choose which customer needs they want to target/serve
Step #2: Marketing Process
- Create Customer Value
- product strategy
- pricing strategy
- channel strategy
- marketing communications strategy
marketing mix
price, product, marketing communications and channels
Snap On: Marketing Process Example
- not regarded as professionals in society, mechanics time is money, productivity is important, does not have reliable cash flow, cannot go to a store
- superior steel in products (product strategy), flexible payment (pricing strategy), mobile store (channel), talking/relationship with customer (mktg comm.)
- execution across all different aspects of organization, driven by customer needs
4.
Step #3: Marketing Process
- Deliver Value
- sales execution
- cross functional alignment
- developed in strategic document: “marketing plan”
marketing plan
- “go-to-market” strategy
- specifies what target segments it will serve, how it will serve them, and how to differentiate itself from competitors
- many strategies in this plan are executed by other functions (sales, mktg, legal, shipping, customer service etc.)
How to implement marketing plan?
- Translate the marketing plan into functional plans (i.e. sales plan, finance plan, IT plan, HR plan etc.)
- the organization has to align all its functions to focus on the customer (customer focus driven organization)
customer focus
cross-functional alignment
Step #4: Marketing Process
- Manage Customer Value
- feedback loop to review strategy and make changes to ensure business is keeping pace with market conditions
a) customer satisfaction measurement
b) segment review
c) customer review
d) product mix review
The Ten Tasks of Marketing
- Identify Opportunities
- Segment and target markets
- Develop a marketing strategy
- Implement the marketing strategy
- Assess and Innovate
- Provide a competitive advantage to the sales force
- Be the customer’s champion within the organization
- Build a customer focused business
- Make marketing accountable
- Be a change agent within the organizations
[I Slay Dior In Aspen. Please, Be Bold, My Baby.]
Smuckers
- Identify Opportunity
- expand food portfolio by purchasing Folgers coffee, Jif peanut butte and Crisco shortening
P&G
- keeping marketers and researchers in their positions longer to enable them to develop a deeper understanding of their business
- going undercover at laundry mats
- greater coordination between the marketing team, R&D (diaper industry, focus on parenting rather than technology)
Operation Eyesight
- tries to eliminate unnecessary blindness in Africa/South Asia
- uses marketing to create value for main stakeholders (donors and hospitals/doctors)
- researches to understand unique needs of each partner (infrastructure vs. purpose)
- builds awareness and ensures brand aligns with stakeholders
Arbol [PT. 1]
- operating in the forest products industry, sell to home builders and end consumers through retailers like Home Depot
- transformed from cost-focused company into a marketing led company
- was a commodity, didn’t think they could charge more for items
