Mktng Strategy by Nirmalaya Kumar

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Marketing as Strategy – Nirmalya Kumar

Presented To:-Professor Atul Tandan

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M A R K E T I N G A S S T R A T E G Y B Y N I R M A L Y A K U M A R

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Essential Concepts

From Branded Bulldozers to Global Distribution Partners

From Brand Acquisitions to Brand Rationalization

From Market-Driven to Market-Driving

From Strategic Business Unit to Corporate Marketing

Conclusion

AGENDA

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According to him three V’s for Analyzing and Planning Marketing Strategy are:-

Essential Concepts

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3 V’s Value

Proposition

Valu

e N

etw

ork

Value Customer

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Essential Concepts

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Radical Innovation

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Essential Concepts

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Brand Proliferation

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From Branded Bulldozers to Global Distribution Partners

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Introduction

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Earlier Power in distribution channel

rested upstream

Remarkable shift in power downstream

FromSuppliers

ToDistributors and retailers

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Challenge From Global Retailers

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Substantial growth in global retailing has led to Distribution consolidationIncreased globalizationValue migration downstream

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Powerful retailers demand more from their multinational suppliers-

Price concessionsUniform terms of tradeSingle point of contactStandardization of product &

services

Retailer challenge to manufacturers

Challenge of global integration for

retailers

Retail is the image of the country in which it lives-

Adapt to local culture

Global Integration is global challenge

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Developing Relationship Mindset

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To implement global account management, suppliers and their global retail partners must develop a shared relationship building mind set.

Manufacturer-Reseller Relationship Matrix“Branded

Bulldozers”“Tug- of Wars” “Strategic

Partnerships”

“Opportunistic Mating”

“Shelf-Space Bidders”

“Assortment Filers”

Strong

Weak

Weak Strong & Adversarial Strong & Cooperative

Man

ufac

ture

r

Reseller

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Two Tough Companies Learn To Dance Together

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Strategies For Developing Relationship Mindset

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Implement Efficient Consumer Response

Retailers and Manufacturer work together to eliminate excess costs and serve the consumer cheaper, faster and better

Adopt Fairness Principles in Relationships

Distributive Justice:-Fairness of outcome received

Procedural Justice:- Fairness of policies and practice

Create Trust, Not Fear in Distribution Relationships

Pursue what is fair, Bilateral Communication. Resolve conflicts through procedures

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Transformations Required

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Strategic Transformation

• Common Policy• Brand Portfolio

Rationalization• Transparent Pricing

Strategy• Globally Competitive

Supply Chains

Organisational Transformation

• Global Business Units• Country Organizations• Customer Business

Development Teams• Joint Planning

Processes

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Transformations Required

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Information System Transformation

• Use standard cost allocations rather than activity-based costing

Human Resource Transformation

• Coordination• Co-Location• Compensation• Composition

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From Brand Acquisitions to Brand Rationalization

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Introduction

Value is determined less by the tangible assets and increasingly by intangible assets

Brands are the most prized intangible assets

“We’re not a manufacturing company anymore. We’ re brand marketing group that happens to make some of its products.”

-Niall FitzGerald, Co-chairman Unilever

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Buying Brands &its market share

Brand mergers and acquisitions

Large Brand portfolios

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Insufficient differentiation

Inefficiency

Lower market power

Management Complexity

Brand Proliferation

Brand Proliferation

Is Costly

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The Managerial Dilemma

How can Brand Portfolios be Pruned without losing the customers and sales revenue of the doomed

brands?

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The Brand Rationalization Process

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•Conduct a Brand Portfolio Audit

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•Determine the optimal Brand Portfolio

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•Select appropriate Brand Deletion Strategies

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•Develop a growth strategy for the surviving brands

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1. Brand Portfolio Audit

Win the support of top-line managers

Goal is to optimize the portfolio rather than optimizing each brand in the portfolio.

Focus on what could occur, not what is actually occurring

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Bottom-Up Approach or

Need Based

Top- Down Approach

orCorporate Portfolio

2. Determine The Optimal Brand Portfolio

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3.Brand Deletion Strategy

Deletion strategies

Delist

MergeMilk

Sell

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4.Develop A Growth Strategy For Surviving Brands

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Shifting the products

Shifting the attributes of

products

Replacing the deleted

with surviving

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From Market-Driven to Market-Driving

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Market Driving Firms

Change the fundamentals of the industry through Radical Business Innovation.

Visionary rather than traditional market research inspires them.

Teach potential customers to consume their drastically different Value-Proposition.

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The Market Driving Firm

The success of Market-Driving firm, stands on radical innovation in these dimensions:

1. Discontinuous leap in the value proposition

2. Rapid configuration of a unique value network.

Value Innovation Market Driving

Continuous Improvement

Architectural Innovation

Value Network

Val

ue P

ropo

siti

on

Existing Unique

Discontinuous Leap

Continuous Improvement

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Inexpensive Locations

Immediate Delivery

Market – Driving IKEA Style

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Simple Designs Mass ProductionInterchangeable Parts

In Exchang

e Of

Self ServiceSelf

TransportationSelf Assembly

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Marketing Strategies Of Market-driving Firms

Lead by Vision rather than by Market Research

Sam Walton – “Give the world an opportunity to see what it’s like to save and have a better lifestyle, a better life for all.”

Redraw Industry Segmentation

A new market moves around Market-Driving Firm’s product-service offering and marketing strategy.

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Marketing Strategies Of Market-driving Firms – Contd.

Create New Price Points for Value Setting prices much lower or considerably above. Have a value proposition that is substantially more compelling

than available alternatives.

Educate Customers For Sales Growth

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Contd..

Reconfigure Channels –

Exploit the “Buzz Network” for Brand Attachment – Early Adopters and Opinion Leaders generate excitement.

Overwhelm Customer Expectations

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Barriers To Market-driving In Incumbent Firms

Well-Established Business Processes are unable to become Market-Driving.

As, Market Driving Ideas:- Overturn Industry Assumptions Risky Consistently Lose to Incremental Innovation Cannibalize Existing Businesses

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Market-driving Transformation Process

Simultaneous management - Incremental as well as Radical Innovation.

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Develop Processes To Identify Hidden Entrepreneurs

Formalize process to encourage out-of-the-box thinking

Discover Hidden Entrepreneurs EG: NEC

Allow Space For Serendipity

Select and Match Employees For Creativity

Team Diversity on function, age, gender, education, culture, mind-set, and life-experiences.

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Offer Multiple Channels For New Idea Approval

3M – Numerous Channels to secure approval and support.

Establish Competitive Teams and “Skunk Works”

Cannibalize Your Own Products -

Encourage Experimentation and Tolerate Mistakes – Limiting Enormity of possible failure, Taking precautions against failure and Learn something from it.

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Strategic Business Unit Marketing to Corporate Marketing

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Marketing is Local – A Traditional Belief Introduction of New Concept i.e. CMO Enhancement in the Role of Marketing at Corporate Level

Introduction

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Role of The Corporate Centre

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• What business should we be in?

Portfolio Choice

• What value should our business add to each other?

Portfolio Relationship

• What value does the corporate centre add?

Parenting skills

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The Search Of Marketing Synergies

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Leverage Product Platform

Exploit Brand Platform

Extend Channel Platforms

Nurture Customers as

Platform

Develop Markets as

Platform

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Emerging Markets As A Growth Platform

Target Growing Masses in Emerging Markets

Keep the Value Proposition Simple & Keep it Simple

Reinvent the Three Vs Model for the Masses.

Transfer Best Practices across Markets.

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Building Customer Focused Capabilities

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Strategy Is Asking The Right Questions

New Product Development Process Order Fulfillment Process Customer Relationship Management

Process

Customer Focused Strategy Map

Customer Focused Processes Map

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Customer Focused Organization Map

Customer Focused Culture Map

Organize Around Customers Specify Measure & Reward Customer

Oriented Behavior Empower Employees to Resolve Customer

Problems

Create a Customer Driven Mission Involve General Managers with Customers Develop Norms of Customer Obsession

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Customer Focused Competences Map

Customer Focused Resources Map

Continuously Learn about Customer Benchmark Marketing Develop Marketing Talent Invest In Customer Focused Strategy

Understand the Role of Marketing Metrics Define Marketing Metrics Conduct Marketing Experiments to

Demonstrate Return on Investment (ROI) Confront Marketing Mix Allocations

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The Challenges Of Being A Customer Focused Firm

CEO as Commander, Chairman, Coach & Catalyst

Stimulate Great Conversation Around Customers

Making Market Transformation Happen

Marketing as a Change Agent

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Conclusion

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Distribution channels have consolidated and have become increasingly sophisticated.

Increased shift in power to retailers

Changes are required in strategy, organizational structure, information technology and human resource management.

Companies must move from brand acquisitions/mergers to Brand Rationalization

Successful Rationalization leads to shrinking brand portfolio while growing sales and profitability

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Emphasis should be on becoming market driving than market driven.

Marketing must become more innovative.

Simultaneous management of incremental and radical innovation

Emerging markets should become a growth platform.

Marketing managers should become strategic partners to CEO’s.

Building Customer focused organization.

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Mktng Strategy by Nirmalaya Kumar

Documents

brand proliferation

strong amp

radical innovation

growth platform

continuous

essential

nirmalya kumar

discontinuous