Chapter 5

Question 1

Marketing channels

Answer 1

It’s very expensive to market to customers so it is very important to research the target audience, message you want to pursuade them with, information distribution channels, frequency of advertising, and type of information. Q’s to ask are: best way to reach them, how costly it is, where do they get info from, having a customer for life vs. cost of customer.

Question 2

Distribution channels

Answer 2

It’s important to research how you plan on sending your products to your customers after you sell them. Customers want the fastest and most convinient method of transfering products and a few key questions to consider while researching to find out are:

• what is the most popular channel
• which is more cost effective
• what is effcient and fast channel
• what will be the method of tranfer being used?
• how will the product reach the customer

Question 3

Market research

Answer 3

Research should be done on

• total available market
• service available market
• service available market

Question 4

Revenue Streams

Answer 4

The amount of money a company makes is generated by the total amount of customer demand which is dependent upon how large the market is, how fast it grows, where the goods are being sold and if the price is affordable. Multiple streams of income are preferable but a few include
-licensing fees
-professional fees
-subscription fees
-transaction fees
-franchise fees
-advertising fees
Q's to ask:
-which revenue stream does the firm use?
-how much are consumers willing to pay
-at what frequency are products being bought and at what quanitity.
-how much profit does each unit make
-is there leverage in revenue-increase income by increasing revenue

Question 5

Diffrentiation

Answer 5

Be sure to diffrentiate your product from other competitiors by satisfying either their needs, solving a problem better, or providing an experience better than other products. It is also important to resonate with customer or provide a few features better than the competitior and substantiate claims with evidence.

Question 6

Product and operations steps:

Answer 6

1. Resources: Ask yourself what type of resources you may need for building your buisness like human resources, intellectual etc.
2. Key metrics: Build a progress report recording changes in quantity and quality of key features generating revenue and costs like customer demand, product sales, resources purchased etc.
3. Cost drivers:
   Know the costs of important things you have or are going to purchase
   -customer life value
   -cost of break even point
   -cost to make product

Question 7

External Environment and Financial Stragety

Answer 7

Competitors-always perform a competitive analysis
Industrial Attractiveness- analyze barriers to see if it’s the right industry to enter
Financial Stragety-document predictions you make related to how your buisness will behave in the near fututre and how much extra capital you will need if things don’t go according to plan.