Brandt

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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The Innovators' Survival Guide: Marketing Edition

• Useful information, tools, advice, buzzwords and examples to help you be successful!

• You can get there from here....it's marketing! Michael Brandt

VP of Marketing and PlanningWHITE PASS & YUKON ROUTE

entrepreneur

en·tre·pre·neur (ŏn'trə-prə-nûr', -nʊr') n.A person who organizes, operates, and assumes the risk for a business venture.

"someone who perceives an opportunity and creates an organization to pursue it."

innovatein·no·vate (ĭn'ə-vāt')

To begin or introduce (something new) for or as if for the first time.

New ProductsNew Production MethodsNew MarketsNew Forms of Organization

& Distribution

Thesaurus: entrepreneur (noun)One that creates, founds, or originates:architect, author, creator, father, founder, inventor, maker, orarchitect, author, creator, father, founder, inventor, maker, originator, parent. iginator, parent.

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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The Innovators' Survival Guide: Marketing Edition

A G E N D A

• Welcome & Introductions

• Setting Objectives for the Planning Session

• MARKETING 101• Open Forum

A Fishing Story• The American investment banker was at the pier of a small coastal

Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellow fin tuna. The American complimented the Mexican on the quality of his fish and asked how long it took to catch them.

• The Mexican replied, only a little while. The American then asked why didn't he stay out longer and catch more fish? The Mexican said he had enough to support his family's immediate needs.

• The American then asked, "but what do you do with the rest of your time?"

• The Mexican fisherman said, "I sleep late, fish a little, play with my children, take siesta with my wife, Maria, stroll into the village each evening where I sip wine and play guitar with my amigos, I have a full and busy life."

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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A Fishing Story -- continued• The American scoffed, "I am a Harvard MBA and could help you.

You should spend more time fishing and with the proceeds, buy a bigger boat with the proceeds from the bigger boat you could buyseveral boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually NYC where you will run your expanding enterprise."

• The Mexican fisherman asked, "But, how long will this all take?" To which the American replied, "15-20 years." "But what then?"

• The American laughed and said that's the best part. "When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions."

• "Millions.. Then what?"

A Fishing Story -- conclusion• The American said, "Then you would retire. Move to a small coastal

fishing village where you would sleep late, fish a little, play with your kids, take siesta with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos."

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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What is Marketing?

• the process of• planning and executing• the conception, pricing, promotion and distribution• of ideas, goods and services• to create exchanges• that satisfy individual and organizational objectives.

“satisfying customers’ needs systematically and at a profit”

Competitive fo

rces

Regulatory forces So

cial

forc

es

Economic forces

Environmental forcesTechnological forces

The Marketing Starting Point

Target Market

PROMOTION

PLACE

PRICE

PRODUCT

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The Strategic Marketing Process: The Strategic Marketing Process: Actions and InformationActions and Information

Step 1

Situation (SWOT) analysis

• Identify industry trends

• Analyze competitors

• Assess own company

• Research customers

• Determine trend in past and current revenues:

For industry and competitors in total and by segment

• Project future revenues, expenses and profits:

For own product in total and by segment

Step 2

Market-product focus and goal

setting• Set market and product goals

• Select target markets

• Find points of difference

• Position the product

• Market potentialBy industryBy segment

• Market-product grids, with ranked targets

• Product positioning that stresses key features, advantages, benefits

Step 3

Marketing program• Develop the program's marketing mix

• Develop the budget, by estimating revenues, expenses, and profits

• Characteristics and timing of:

Product actionsPrice actionsPromotion actionsPlace actions

• Projected marketing expenses

• Detailed plans to execute the marketing program

• Obtain resources

• Design marketing organization

• Develop schedules

• Execute marketing program

• Memos assigning responsibilities for actions and deadlines; Gantt charts

• Organizational charts and job descriptions

ControlPhase

• Compare results with plans to identify deviations

• Correct negative deviations; exploit positive ones

•measuring results of the marketing actions

• Deviation reports comparing actual results with plans

• Action memos to try to correct problems and exploit opportunities

Plans Results

Planning Phase

Corrective actions Corrective actions

ImplementationPhase

Tracking reports

Info

rmat

ion

Act

ion

The Strategic Marketing Process..• The Planning Phase

– Situation (SWOT) Analysis

– Market-Product Strategies

• Market Penetration– increasing market share

• Market Development– developing new markets

• Product Development– developing new products

• Diversification– developing new products

for new markets

– Market-Product Focus and Goal Setting

• Market Segmentation• Selecting the Target

Market• Defining Competitive

Advantage

• Marketing Program• Develop the Marketing

Mix (the 4 Ps)

• Developing the Budget

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..The Strategic Marketing Process

• The Implementation Phase– Obtaining Resources– Designing the

Marketing Organization

– Developing Schedules– Executing the Program

• Marketing Strategy• Marketing Tactics

• The Control Phase– Comparing Results

with Plans to Identify Deviations

– Acting on Deviations

Key Organizational Buying CriteriaKey Organizational Buying Criteria

QualitySpecifications

TechnicalCapability

PastPerformance

OrganizationalOrganizationalBuying CriteriaBuying Criteria

DeliverySchedulesPrice

Warranty/Claim Policies

ProductionFacilities/Capacity

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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Why Consumers Buy OnlineWhy Consumers Buy Online

Convenience

ControlCustomization Communication

ChoiceCost

Five Product & Promotion StrategiesFive Product & Promotion Strategiesfor Global Marketingfor Global Marketing

Same Product Adapt Product Create New Product

SamePromotion

AdaptPromotion

Communicationadaptationstrategy

ProductExtensionStrategy

ProductAdaptation

Strategy

DualAdaptation

Strategy

ProductInventionStrategy

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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THE MARKETING MIXTHE MARKETING MIX

PlaceOutletsChannelsCoverageTransportationStock level

PlaceOutletsChannelsCoverageTransportationStock level

PromotionAdvertisingPersonal sellingSales promotionPublicity

PromotionAdvertisingPersonal sellingSales promotionPublicity

PriceList priceDiscountsAllowancesCredit itemsPayment period

PriceList priceDiscountsAllowancesCredit itemsPayment period

ProductFeaturesBrand namePackagingServiceWarranty

ProductFeaturesBrand namePackagingServiceWarranty

MarketingElements

MarketingElements

Cohesive marketing mix

PromotionPlace

Price

PromotionPlaceProduct

The Promotional MixThe Promotional Mix• Advertising• Personal Selling• Public Relations• Sales Promotion• Direct Marketing

• Coupons• Deals• Premiums• Contests• Sweepstakes• Samples• Point of Purchase

Displays• Rebates

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How stages of the product life cycle relate to a firmHow stages of the product life cycle relate to a firm’’s s marketing objectives and marketing mix actionsmarketing objectives and marketing mix actions

Marketing objective

Marketing objective Gain

AwarenessGain Awareness Stress

differentiationStress differentiation Maintain

brand loyaltyMaintain brand loyalty Harvesting,

deletionHarvesting, deletion

CompetitionCompetition NoneNone GrowingGrowing ManyMany ReducedReduced

ProductProduct OneOne More versionsMore versions Full product line

Full product line Best sellersBest sellers

PricePrice Skimming or penetration

Skimming or penetration Gain share, dealGain share, deal Defend share,

profitDefend share, profit Stay profitableStay profitable

PromotionPromotion Inform, educateInform, educate Stress competitive differences

Stress competitive differences

Reminder oriented

Reminder oriented Minimal

promotionMinimal promotion

Place(distribution)

Place(distribution) LimitedLimited More outletsMore outlets Maximum

outletsMaximum outlets Fewer outletsFewer outlets

Stage of the product life cycleSa

les r

even

ueor

pro

fitIntroduction Growth Maturity Decline

+0–

Total industrysales revenue

Total industry profit

Importance of Promotional ElementsImportance of Promotional Elementsduring the Consumerduring the Consumer’’s Purchase Decisions Purchase Decision

Prepurchase Purchase Postpurchase

Personal selling

Sales promotion

Advertising

Impo

rtan

ce o

f pro

mot

iona

l too

l

High

Low

Stage of consumer’s purchase decision

Direct Marketing

Public relations

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Promotional Tools used over the Promotional Tools used over the Product Life Cycle of Purina Product Life Cycle of Purina

Puppy ChowPuppy Chow

Introduction

Growth Maturity

Decline

To inform To persuade To remind

Stage ofproduct

lifecycle

Promotionalobjective

Promotionalactivity

• Publicity inveterinarymagazines

• Advertising• Salesforce calling• on intermediaries• Sales promotion

in form offree samples

• Personal sellingto intermediaries

• Advertising todifferentiatePuppy Chowattributes fromthose ofcompetingbrands

• Reminderadvertising

• Sales promotion inform of discountsand coupons

• Limited personalselling

• Direct mailreminders

• Littlemoneyspent onpromotion

Steps in Setting PriceSteps in Setting Price

Determine cost, volume, and profit relationships

Step 1

Step 2

Step 3

Step 4

Step 5

Step 6

Identify pricing constraints and objectives

Estimate demand and revenue

Select an approximate price level

Set list or quoted price

Make special adjustments to list or quoted price

APPROACHES• Demand• Cost• Profit• Competition

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Tot

al r

even

ue o

r to

tal c

ost

Loss

Profit

Quantity

Total revenue

Total cost (fixed and variable cost)

Variable cost

Fixed cost

⎫⎬⎭

BreakBreak--Even Analysis ChartEven Analysis Chart

Functions Performed by Independent Functions Performed by Independent Wholesaler TypesWholesaler Types

FULL SERVICE

FUNCTIONSPERFORMED

GENERALMERCHAN-DISE

SPECIALTYMERCHAN-DISE

RACKJOBBERS

CASHANDCARRY

DROPSHIPPERS

TRUCKJOBBERS

BuyingSales calls oncustomersRisk taking(taking title toproducts)LOGISTICALFUNCTIONSCreates productassortmentsStores products(maintainsinventory)Sorts products

TransportsproductsFACILITATINGFUNCTIONSProvides financing(credit)Provides marketinformation andresearchGrading

TRANSACTIONALFUNCTIONS

MANUFAC-TURER'SAGENTS

SELLINGAGENTS BROKERS

LIMITED SERVICEMERCHANT WHOLESALERS

AGENTS AND BROKERS

Key: , Yes; , Sometimes; , No.

The Innovators' Survival Guide: Marketing EditionBy Michael Brandt

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Balancing Total Logistics CostsBalancing Total Logistics Costsand Customer Service Factorsand Customer Service Factors

Stockoutcosts

Inventorycosts

Transportationcosts

Materials handlingand warehousing

costs

Orderprocessingcosts

Convenience

Time

Communication

Dependability

Total logistics cost factors Customer service factors

Michael’s Favorite Axioms

• “What gets measured gets managed”• “If you’ve got to do “A” and “B” to get an

outcome and you’ve got a 90% chance at each “A” an “B”, you’ve got an 81% chance of the outcome.”

• “If you fail to plan, you plan to fail!”• “Adaptation to change is the key to survival.”• “It’s about the Customer!”