Transaction-cost matrix / Dynamic SWOT / Frictions Matrix Flashcards
Transaction cost matrix
Axis
Horizontal - new economy
left: T1< right: T1>
Vertical - old economy
up: T1< down: T1>
Transaction cost matrix
quadrants
left up: direct marketing opportunities
right up: threatened retail
left down: pure players
right down: opportunities for retail
Transaction cost matrix
upper right
Threatened bricks-and-mortar retail
- This is the situation that bricks-and-mortar retail should be most concerned. In time, these shops will see their revenue decline in favor of the market share of e-retailers but also within the composition of their own sales.
- The extent to which information is embedded in a product or service, the extent to which it is digitized, plays an important role!
○ For example, the physical distribution of music or video plays has largely disappeared
○ But also, cars, kitchens or furniture are in danger (most of the buying process also consists of the processing of information)
Transaction cost matrix
upper left
- Poses a less direct threat to retail. After all, this revenue was not in the retail sector anyway.
- However, the relative position of direct marketers and the technical possibilities open to them are becoming stronger because of the internet. This will allow them to increase their market share at the expense of bricks-and-mortar retail (as information intermediaries)
Transaction cost matrix
lower left
Domain of pure players: clicks and orders
- New opportunities arise for retail-distribution systems that offer goods over the internet or try to match up supply and demand, for example, Amazon and eBay. These are cyber-intermediaries or pure players.
sales are growing considerably but do not have an easy time either. There are two reasons:
- Marketing costs: it takes a lot of time, effort and money to attract visitors to the website. This results in high marketing costs, and also: winner-takes-all principle applies even more online
- Fulfilment costs: costs for the entire logistical transaction (not only deliver, also return costs)
Transaction cost matrix
lower right
- Hybrid companies that start an internet sales channel from bricks-and-mortar retail, or pure players that build physical shops based on an existing internet channel, or even manufacturers that will span the entire spectrum. For example, Apple
- Zalando & Coolblue are the opposite kind: it is an e-tailer that also opens bricks-and-mortar retail premises
Dynamic SWOT
Axis
horizontal - threats - opportunities
vertical - strengths - weaknesses
Dynamic SWOT
upper right
Attack strategy
An ideal situation. A lot of opportunities and the company is ideally placed to tackle the future.
Dynamic SWOT
lower right
Improve strategy
Many opportunities, but the internal conditions are not suitable for making these.
Dynamic SWOT
upper left
Defend strategy
The external circumstances are not favorable, but the company is sufficiently equipped to cope with them. A defensive strategy is needed. The weaker competition will automatically fall away because of external threats.
Dynamic SWOT
lower left
Withdrawal Strategy
the company is in the most unfavorable circumstances, consider getting out.
Frictions matrix
axis
horizontal
left to right: external - internal
vertical
up to down: long term - short term
Frictions matrix
upper right
Long term & Internal = Strategic Efficiency
- building up operational advantages over the competition
- effectiveness, here, is more important than productivity.
operational efficiency
benchmarking
cost standardization
Frictions matrix
upper left
Long term & External = Strategic Market Position
- developing concepts and retail formulas
environment
market development
target group
positioning
concept development
Frictions matrix
lower right
Short term & Internal = Tactical Cost Reduction
-about increasing productivity than about increasing effectiveness: development of productivity.
cost control
productivity improvement
stock reduction
staff reduction
