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Endianness or Byte Order
Bhavana Honnappa, Sravya Karnati, Smita Dutta
Abstract
Computers speak different languages, like people. Some write
data "left-to-right" and others "right-to-left". If a machine can
read its own data it tends to encounter no problems but when
one computer stores data and a different type tries to read it,
that is when a problem occurs. This document aims to present
how Endianness is willing to be taken into consideration how
Endian specific system inter-operate sharing data without
misinterpretation of the value. Endianness describes the
location of the most significant byte (MSB) and least significant
byte (LSB) of an address in memory and is defined by the CPU
architecture implementation of the system. Unfortunately, not
all computer systems are designed with constant Endian
architecture. The difference in Endian architecture is a
difficulty when software or data is shared between computer
systems. Little and big endian are two ways of storing multibyte
data- type (int, float, etc.). In little endian machines, last byte
of binary representation of the multi byte data- type is stored
first. On the opposite hand, in big endian machines, first byte of
binary representation of the multi byte datatype is stored first.
Suppose we write float value to a file on a little-endian machine
and transfer this file to a big-endian machine. Unless there is
correct transformation, big endian machine will read the file in
reverse order. This paper targets on showcasing how CPU-based
Endianness raises software issues when reading and writing the
data from memory. We will try to reinterpret this information at
register/system-level.
Keywords: -
endianness, big-endian, little-endian, most significant byte
(MSB), least significant byte (LSB).
Definition of Endianness: -
Endianness refers to order of bits or bytes within a binary
representation of a number. All computers do not store multi-
byte value in the same order. The difference in Endian
architecture is an issue when software or data is shared between
computer systems. An analysis of the computer system and its
interfaces will determine the requirements of the Endian
implementation of the software. Based on which value is stored
first, Endianness can be either big or small, with the adjectives
referring to which value is stored first.
Little Endian and Big Endian: -
Endianness illustrates how a 32-bit pattern is held in the four
bytes of memory. There are 32 bits in four bytes and 32 bits
in the pattern, but a choice has to be made about which byte of
memory gets what part of the pattern. There are two ways that
computers commonly do this.
Little endian and Big endian are the two ways of storing
multibyte data types. Little Endian and Big Endian are also
called host byte order and network byte order respectively. In a
multibyte data type, right most byte is called least significant
byte (LSB) and left most byte is called most significant byte
(MSB). In little endian the least significant byte is stored first,
while in big endian, most significant byte is stored. For
example, if we have store 0x01234567, then big and little
endian will be stored as below:
However, within a byte the order of the bits is the same for all
computers, no matter how the bytes themselves are arranged.
Bi -Endian: -
Some architectures such as ARM versions 3 and
above, MIPS, PA-RISC, etc. feature a setting which allows
for switchable endianness in data fetches and stores, instruction
fetches, or both. This feature can improve performance or
simplify the logic of networking devices and software. The
word bi-endian, when said of hardware, denotes the capability
of the machine to compute or pass data in either endian format.
Importance of endianness:
Endianness is the attribute of a system that indicates whether
the data type like integer values are represented from left to
right or vice-versa. Endianness must be chosen every time
hardware or software is designed.
When Endianness affects code:
Endianness doesn’t apply to everything. If you do bitwise or
bit-shift operations on an int, you don’t notice endianness.
However, when data from one computer is used on another you
need to be concerned. For example, you have a file of integer
data that was written by another computer. To read it correctly,
you need to know:
· The number of bits used to represent each integer.
· The representational scheme used to represent integers (two's
complement or other).
· Which byte ordering (little or big endian) was used.
Processors Endianness:
CPU controls the endianness. A CPU is instructed at boot time
to order memory as either big or little endian A few CPUs can
switch between big-endian and little-endian. However,
x86/amd64 architectures don't possess this feature. Computer
processors store data in either large (big) or small (little) endian
format depending on the CPU processor architecture. The
Operating System (OS) does not factor into the endianness of
the system, rather the endian model of the CPU architecture
dictates how the operating system is implemented. Big endian
byte ordering is considered the standard or neutral "Network
Byte Order". Big endian byte ordering is in a suitable format for
human interpretation and is also the order most often presented
by hex calculators. As most embedded communication
processors and custom solutions associated with the data plane
are Big-Endian (i.e. PowerPC, SPARC, etc.), the legacy code on
these processors is often written specifically for network byte
order (Big-Endian).
Few of the processors with their respective endianness’s are
listed below: -
Processor
Endianness
Motorola 68000
Big Endian
PowerPC (PPC)
Big Endian
Sun Sparc
Big Endian
IBM S/390
Big Endian
Intel x86 (32 bit)
Little Endian
Intel x86_64 (64 bit)
Little Endian
Dec VAX
Little Endian
Alpha
Bi (Big/Little) Endian
ARM
Bi (Big/Little) Endian
IA-64 (64 bit)
Bi (Big/Little) Endian
MIPS
Bi (Big/Little) Endian
Bi-Endian processors can be run in either mode, but only one
mode can be chosen for operation, there is no bi-endian byte
order. Byte order is either big or little endian.
Performance analysis:
Endianness refers to data types that are stored differently in
memory, which means there are considerations when accessing
individual byte locations of a multi-byte data element in
memory.
Little-endian processors have an advantage in cases where the
memory bandwidth is limited, like in some 32-bit ARM
processors with 16-bit memory bus, or the 8088 with 8-bit data
bus. The processor can just load the low half and complete
add/sub/multiplication with it while waiting for the higher half.
With big-endian order when we increase a numeric value, we
add digits to the left (a higher non-exponential number has more
digits). Thus, an addition of two numbers often requires moving
all the digits of a big-endian ordered number in storage, to the
right. However, in a number stored in little-endian fashion, the
least significant bytes can stay where they are, and new digits
can be added to the right at a higher address. Thus, resulting in
some simpler and faster computer operation.
Similarly, when we add or subtract multi-byte numbers, we need
to start with the least significant byte. If we are adding two 16-
bit numbers, there may be a carry from the least significant byte
to the most significant byte, so we must start with the least
significant byte to see if there is a carry. Therefore, we start
with the rightmost digit when doing longhand addition and not
from left. For example, consider an 8-bit system that fetches
bytes sequentially from memory. If it fetches the least
significant byte first, it can start doing the addition while the
most significant byte is being fetched from memory. This
parallelism is why performance is better in little endian on such
as system. In case, it had to wait until both bytes were fetched
from memory, or fetch them in the reverse order, it would take
longer.
In "Big-Endian" processor, by having the high-order byte come
first, we can quickly analyze whether a number is positive or
negative just by looking at the byte at offset zero. We don't
have to know how long the number is, nor do you have to skip
over any bytes to find the byte containing the sign information.
The numbers are also stored in the order in which they are
printed out, so binary to decimal routines are highly efficient.
Handling endianness automatically:-
To work automatically, network stacks and communication
protocols must also define their endianness, otherwise, two
nodes of different endianness won't be able to communicate.
Such a concept is termed as “Network Byte Order”. All protocol
layers in TCP/IP are defined to be big endian which is typically
called network byte order and that they send and receive the
most significant byte first.
If the computers at each end are little-endian, multi-byte
integers passed between them must be converted to network
byte order before transmission, across the network and
converted back to little-endian at the receiving end.
If the stack runs on a little-endian processor, it's to reorder, at
run time, the bytes of each multi-byte data field within the
various headers of the layers. If the stack runs on a big-endian
processor, there’s nothing to stress about. For the stack to be
portable, it's to choose to try and do this reordering, typically at
compile time.
To convert these conversions, sockets provides a collection of
macros to host a network byte order, as shown below:
· htons() - Host to network short, reorder the bytes of a 16-bit
unsigned value from processor order to network order.
· htonl() - Host to network long, reorder the bytes of a 32-bit
unsigned value from processor order to network order.
· ntohs() - Network to host short, reorder the bytes of a 16-bit
unsigned value from network order to processor order.
· ntohl() - Network to host long, reorder the bytes of a 32-bit
unsigned value from network order to processor order.
Let’s understand this with a better example:
Suppose there are two machines S1 and S2, S1 and S2 are big-
endian and little-endian relatively. If S1(BE) wants to send
0x44332211 to S2(LE)
· S1 has the quantity 0x44332211, it'll store in memory as
following sequence 44 33 22 11.
· S1 calls htonl () because the program has been written to be
portable. the quantity continues to be represented as 44 33 22
11 and sent over the network.
· S2 receives 44 33 22 11 and calls the ntohl().
· S2 gets the worth represented by 11 22 33 44 from ntohl(),
which then results to 0x44332211 as wanted.
References: -
· https://www.geeksforgeeks.org/little-and-big-endian-mystery/
· http://cs-fundamentals.com/tech-interview/c/c-program-to-
check-little-and-big-endian-architecture.php
· https://developer.ibm.com/articles/au-endianc/
· https://aticleworld.com/little-and-big-endian-importance/
· https://searchnetworking.techtarget.com/definition/big-endian-
and-little-endian
2
09/03/2020
1
MAN3106 Marketing Strategy
Segmentation, Positioning, and
Selecting Target Markets
1
2
09/03/2020
2
Announcements
Frequently Asked Questions:
1. Is it possible to search for information beyond the case
study? (see also Week 4)
2. Case study is outdated, can I search for the company position
and market stats in
2020?
3. What should I do if there is no political issue in the case?
4. Should I analyse historical information (i.e., first 2-3 pages
in the Gillette case)?
5. Completing SWOT before or after situation analysis (see also
Week 4)
6. Is there an ideal number of alternative strategies that is
recommended to include
in the assignment to secure a high mark? (see also Week 4)
7. Can I indicate XYZ in a particular analysis? Could you
please check my XYZ
analysis? (see also Week 4)
8. Reference list
3
Structure of Individual Assignment
§ Executive summary – around 200 words-not included in the
word count
§ Table of contents – not included in the word count
§ Situational analysis (20% of the mark) – Macro environment
(PESTLE),
industry, competitors, & customer environment – around 350
words
§ Internal environment & SWOT analysis (20% of the mark) –
around 350
words
§ Evaluation of current strategies and problem statement (30%
of the mark)
– 400 words
§ Alternative strategies proposition, evaluation, & justification
(30% of the
mark) – around 400 words
§ Reference list (if necessary – not included in the word count)
4
09/03/2020
3
Announcements
Important tips:
1. Students can use tables/figures to present situation analysis,
internal
analysis, and SWOT analysis (excluded from word count). For
each
table/figure, a conclusion should be provided as part of the main
text. For
instance, students can provide two key conclusions for 5 forces
analysis: the
level of competitive intensity and the level of attractiveness of
the market.
2. Problem statement is different to the above-noted conclusions
for each
analysis.
3. Problem statement should be based on linking different
elements identified
in the situation analysis, internal analysis, and SWOT analysis.
Thus, problem
statement should be based on information provided in the case
study.
5
Announcements
Important tips:
4. Students can consider novel alternative strategies to address
the identified
problem(s). However, the proposed strategies should be
justified using the
information in the case study. For instance, a company can
expand to new
international markets, if it has strong financial resources and
distributions
channels based on evidences in the case study.
5. An alternative strategy could be: Status Quo - with
improvements
6. The introduced frameworks/principles in the slides and core
textbook are
generic, which can be used for different case studies (and
companies in
reality). Case studies are not identical, and each case study may
provide
different facts. As a critical thinker, you should decide which
facts are critical
and should be considered for a particular analysis.
6
09/03/2020
4
Main Topics
1. Introduction
2. Segmentation and Positioning Principles (Chapter 7)
3. Segmentation and Positioning Research (Chapter 8)
4. Selecting Market Targets (Chapter 9)
7
Introduction and Relevance
Positioning is the act of designing the company’s offering and
image so that
they occupy a meaningful and distinctive competitive position
in the target
customer’s minds. (Kotler, 1997)
8
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5
Introduction and Relevance
Positioning risks and errors
9
1
Segmentation and Positioning Principles
Chapter 7
10
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Principles of Market Segmentation
Factors that affect the consumer buying process
§ Decision-making complexity (e.g. high risk, no prior
experience, strong
involvement)
§ Individual influences (e.g. age, occupation, personality
characteristics,
socioeconomic status)
§ Social influences (e.g. culture, reference groups, peers)
§ Situational influences (e.g. temporal, spatial, dispositional
factors)
Need
Recognition
Information
Search
Evaluation
of
Alternatives
Purchase
Decision
Post-
Purchase
Evaluation
11
Principles of Market Segmentation
Market Segmentation
… is the process of dividing a market into
relatively homogeneous segments
or groups.
… should create segments where the
members within the segments have similar
attributes; but where the segments
themselves are dissimilar from each other.
… typically allows firms to be more
successful, because they can tailor products
to meet the needs of a particular market
segment.
Defining the
market to be
segmented
Identifying
market
segments
Forming
market
segments
Finer
segmentation
strategies
Selecting
segmentation
strategy
12
09/03/2020
7
Segmenting Consumer Markets
Segmenting consumer market – Three main methods:
§ Background customer characterises
§ Customer attitudes
§ Customer behaviour
13
Segmenting Consumer Markets
Background customer characterises:
UK socio-economic classification scheme
Source: The Market
Research Society.
14
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8
Segmenting Consumer Markets
Background customer
characterises:
The Warner index of status
characteristics
15
Segmenting Consumer Markets
Background customer characterises:
Stages of the family life cycle
16
09/03/2020
9
Segmenting Consumer Markets
Three main methods:
§ Background customer characterises
§ Customer attitudes: Attitudinal characteristics attempt to draw
a causal link
between customer characteristics and marketing behaviour
§ Mainly examine benefits/preferences customers are seeking
- e.g. Banking industry: Convenient access, security, interest
rate
§ Customer behaviour: The most direct method – Covers
purchase behaviour,
consumption behaviour, and communication behaviour
§ Purchases behaviour: Early adaptor, Brand loyalty, etc.
§ Consumption behaviour: Usage pattern, Usage volume, etc.
§ Communication behaviour: Lead users, Promotions, etc.
17
Implementing Market Segmentation
§ Identify the scope and purpose of segmentation (e.g. new
product launch, market
penetration with existing products)
§ Identify the level of segmentation: Strategic, managerial, and
operation
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Implementing Market Segmentation
Challenges/problems of implementing market segmentation
§ Organisation structure
§ Internal policies
§ Corporate culture
§ Information and reporting
§ Decision-making process
§ Resource/capabilities
§ Operation systems
19
2
Segmentation and Positioning Research
Chapter 8
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11
Segmentation Research
Two broad approaches
§ Priori segmentation
§ Segmentation is known in advance
§ Easiest way of segmentation based on
demographic or socio-economic stats available
in the public domain (e.g., Target Group Index, ACORN)
§ Post-hoc or cluster-based segmentation
§ Segmentation is not known in advance
§ Data will be collected based pre-defined
criteria using quantitative and/or qualitative
methods
21
Segmentation Research
Post-hoc or cluster-based segmentation
22
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12
Positioning Research
Two broad approaches
§ Qualitative research methods
§ Uncover brand, product, company image
§ Semi-structured techniques to gain in-depth understanding of
respondents
perceive the world around them
§ Effective in development of advertising programmes
§ Quantitative approaches - Investigate positioning relative to:
a. Position of major competitors in the market (e.g., market
share, coverage,
product portfolio, etc)
b. Target customers’ desires and needs (e.g., value for money,
reliability, quality,
safety, convenience, etc)
23
Positioning Research
Quantitative approaches – Attribute profiling methods
24
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13
Positioning Research
Quantitative approaches – Attribute profiling methods &
Perceptual map
25
Positioning Research
Quantitative approaches – Attribute profiling methods &
Perceptual map
26
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14
3
Selecting Market Targets
Chapter 9
27
Introduction
Targeting
… means choosing to focus on one (or more) market segments
based on their
attractiveness.
… determines which customer group(s) the organization will
serve (and which not).
§ Example of different targeting strategies
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The Process of Selecting Market Targets
The process of selecting market targets
1. Define the market
2. Define how the market is segmented
3. Determine market segment attractiveness
4. Determine current and potential strength
5. Making market/segment choices
29
The Process of Selecting Market Targets
1. Define the market
Product-customer matrix: The underlying
structure of a market can be understood as a
simple grouping of customers and
products/services
§ Grouping products/services in banking: Provide
access to cash, provide security, but now/pay
later, cashless payment, interest on saving, other
specialised services
§ Grouping customer preferences/needs in
banking: Convenience, easy to use, efficiency,
trust, interest rate, and other preferences
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16
The Process of Selecting Market Targets
2. Define how the market is segmented (see Chapters 7 & 8)
3. Determine market segment attractiveness (see Situation
analysis)
§ Market factors
§ Competitive factors
§ Economic/technological factors
§ Business environment factors
31
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Discuss the impact of evolution of music industry on the music
player/speaker market and potential new market segments
32
09/03/2020
17
The Process of Selecting Market Targets
4. Determine current and potential strength
Recap: Competitor analysis in Chapter 5
Recap: Resource Portfolios in Chapter 6
33
The Process of Selecting Market Targets
5. Making market/segment choices
34
09/03/2020
18
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Propose hypothetical primary targets, secondary
targets, and possibilities for:
§ Secret Escapes
§ Contiki
35
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Propose hypothetical primary targets, secondary
targets, and possibilities for:
§ Galaxy Z Flip £1300
§ Galaxy A90 £399
36
09/03/2020
19
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Propose hypothetical primary targets, secondary
targets, and possibilities for:
§ Boohoo.com
37
Reality in Many Organisations
The End. Have Fun!
38
09/03/2020
20
Reading Resources
Chapters 7, 8, & 9: Hooley, G., Piercy, N. F., and Nicoulaud, B.
(2017), Marketing Strategy &
Competitive Positioning, Prentice Hall, 6th Edition.
Chapter 5: Ferrell, O. C. and Hartline M. D. (2014), Marketing
Strategy, Cengage, 6th Edition.
Dickson, P. R., & Ginter, J. L. (1987). Market segmentation,
product differentiation, and marketing
strategy. Journal of Marketing, 51(2), 1-10.
Green, P. E., & Krieger, A. M. (1991). Segmenting markets with
conjoint analysis. Journal of
Marketing, 55(4), 20-31.
Hooley, G., Broderick, A., & Möller, K. (1998). Competitive
positioning and the
resource-based view of the firm. Journal of Strategic Marketing,
6(2), 97-116.
Moschis, G. P., Lee, E., & Mathur, A. (1997). Targeting the
mature market: opportunities and
challenges. Journal of Consumer Marketing, 14(4), 282-293.
Yankelovich, D., & Meer, D. (2006). Rediscovering market
segmentation. Harvard Business Review,
84(2), 122.
39
Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Gillette case study
situation analysis
Week 3 - Competitive market analysis Gillette case study
situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Gillette case study SWOT analysis
Week 5 - Segmentation, positioning, and selecting target
markets
Gillette case study problem identification &
alternative strategies provision
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix Using metaphors in
marketing campaigns
Week 8
- Competing through superior service and customer
relationships
Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10
- Ethics and social responsibility in marketing strategy
- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
40
01/03/2020
1
MAN3106 Marketing Strategy
Understanding the Organisational Resource Base
Competing Through Innovation
1
2
01/03/2020
2
Announcements
Frequently Asked Questions:
1. Using perceptual (or positioning) map for competitor analysis
2. PDF vs PPT lecture slides
3. Completing SWOT before or after situation analysis
4. Is there an ideal number of alternative strategies that is
recommended to
include in the assignment to secure a high mark?
5. Individual assignment structure and assessment criteria
6. Where I can find the individual assignment case study?
7. Can I indicate XYZ in a particular analysis? Could you
please check my XYZ
analysis?
3
Main Topics
1. Chapter 6: Understanding the Organisational Resource Bass
a. Resource-based View
b. Marketing resources – Assets
c. Marketing resources – Capabilities
d. Marketing resources – Dynamic capabilities
2. Chapter 12: Competing Through Innovation
a. Why Innovation Matters
b. Engaged to a Robot? The Role of AI in Service
c. Planning for New Products/Services
d. New Product/Service Development Process
4
01/03/2020
3
Chapter 6
Understanding the Organisational Resource Base
5
Unit of Analysis in Market Analysis
Unit of
Analysis
External
Environment
Macro-
Environment
Micro-
Environment
Internal
Environment
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4
Analysis of the Internal Environment
Review of current marketing objectives, strategy, and
performance
§ What are the current marketing goals and objectives?
§ How are current marketing strategies performing with respect
to anticipated
outcomes?
Review of current and anticipated organisational resources
§ What is the state of current organisational resources?
§ Are these resources likely to change for the better or worse in
the near future?
§ If the changes are for the better, how can these added
resources be used to better
meet customers’ needs?
Review of current and anticipated cultural and structural issues
§ What are the positive and negative aspects of the current and
anticipated
organisational culture?
§ What issues related to internal politics or management
struggles
might affect the marketing activities?
7
Resource-based View
§ Resource-based view (RBV) is a framework to determine the
strategic resources a
firm can exploit to achieve sustainable competitive advantage
and to explain
performance heterogeneity across firms (Barney, 1991).
§ A key insight arising from RBV is that not all resources are of
equal importance
§ VRIO Framework:
§ Valuable – enable a firm to implement its strategies.
§ Rare – not available to other competitors.
§ Imperfectly (or costly to) imitable –
not easily implemented by others.
§ Organized to Capture Value –
resources do not confer any
advantage for a firm if they are not
organized using organisational
structure, processes/capabilities,
and culture.
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5
Resource-based View
§ Value-creating disciplines: Only some resources/capabilities
need to be
superior to competition and enable firms to propose
differentiated offering
to customers that are hard for competitors to match.
§ Resource Portfolios
9
Resource-based View
Value-creating disciplines
§ Operational excellence – providing middle-of-market
products at the best price with the least
inconvenience. e.g., McDonald’s, Burger King and KFC.
§ Product leadership – offering products that push the
boundaries of product and service performance. e.g.,
Intel is a product leader in computer chips.
§ Customer intimacy – delivering what specific
customers want in cultivated relationships. The core
requirements are flexibility, a ‘have it your way’
mindset, mastery of ‘mass customisation’, and the
ability to sustain long-term relationships.
10
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6
Marketing Resources: Assets – Capabilities – Dynamic
Capabilities
11
Marketing Resources: Assets
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7
Marketing Resources: Capabilities
§ An organisation's ability to manage assets effectively to meet
customer
needs and gain an advantage over competitors.
§ A capability is a coordinated bundle of inter-related routines
that a firm (or a
group of employees) undertakes to perform specific tasks.
Input Output
13
Marketing Resources: Capabilities
Organizational routines (Nelson and Winter, 1982; Feldman and
Pentland, 2003)
§ Regular & predictable
§ Collective, social & tacit - Learned over time
§ Behaviour & performance: The way firms do things
§ Enable tasks to be executed sub-consciously
§ Binding knowledge, including tacit knowledge
§ Can promote or prohibit innovation
Importantly routines are learned over time and they are highly
firm-specific
§ Each organization has its own particular ways of doing things,
and this can often
be a source of competitive advantage.
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Marketing Resources: Capabilities
Marketing
CapabilityPricing
Promotion /
Advertising
Market
Research
Distribution Sales
Marketing
Planning
New P/S Launch
Management
CRM
15
Marketing Resources: Dynamic Capabilities
Dynamic capabilities represent the capacity of an organisation
to purposefully
create, extend, or modify its resource base (Helfat et al., 2007).
§ As markets change and become more globally integrated, new
forms of
competition emerge and firms cannot rest on their existing
capabilities alone.
Source: Pavlou & El Sawy (2011)
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Marketing Resources: Dynamic Capabilities
Resource Portfolios: Developing and exploiting resources
Organizational ambidexterity: The simultaneous exploration and
exploitation
of resources and product-market opportunities.
17
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
What are benefits and drawbacks of
being ambidextrous in the car
industry?
18
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10
Reading Resources
Chapters 6: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017),
Marketing Strategy & Competitive
Positioning, Prentice Hall, 6th Edition.
Barney, J. B. (2001). Resource-based theories of competitive
advantage: A ten-year retrospective
on the resource-based view. Journal of Management, 27(6), 643-
650.
Heirati, N., O’Cass, A., & Sok, P. (2017). Identifying the
resource conditions that maximize the
relationship between ambidexterity and new product
performance. Journal of Business &
Industrial Marketing, 32(8), 1038-1050.
Morgan, N. A., Vorhies, D. W., & Mason, C. H. (2009). Market
orientation, marketing capabilities,
and firm performance. Strategic Management Journal, 30(8),
909-920.
O'Cass, A., Heirati, N., & Ngo, L. V. (2014). Achieving new
product success via the synchronization
of exploration and exploitation across multiple levels and
functional areas. Industrial
Marketing Management, 43(5), 862-872.
Pavlou, P., & El Sawy, O. (2011). Understanding the elusive
black box of dynamic
capabilities. Decision sciences, 42(1), 239-273.
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic
capabilities and strategic management.
Strategic Management Journal, 18(7), 509-533.
19
Chapter 12
Competing Through Innovation
20
01/03/2020
11
Why Innovation Matters
§ Everybody wants to be the next Google, IBM, or Netflix
§ Nobody wants to be Kodak, Blockbuster, or BlackBerry.
§ “Companies achieve competitive advantage through acts of
innovation.
They approach innovation in its broadest sense, including both
new
technologies & new ways of doings things” - Michael Porter
21
Why Innovation Matters
§ Achieving success through innovation is not easy and the
failure rate is high
§ What is missing is a clear set of principles for action!
§ This can only be achieved by treating innovation as a process.
22
01/03/2020
12
Source: Adapted from Piercy (2017)
Why Innovation Matters
Innovation as the Driver of Renewal and Reinvention
23
Key Success/Failure Factors
24
01/03/2020
13
Planning for New Products/Services
New product development stages and time lapse
25
Planning for New Products/Services
Innovation types based on the level of Newness
26
01/03/2020
14
Planning for New Products/Services
Innovation types based on
the level of Newness
27
Planning for New Products/Services
Scope of Innovation: 4Ps of Innovation Space
§ Product – Changes in the things (products/services)
§ Process – Changes in the ways in which they are created and
delivered
§ Position – Changes in the context in which the
products/services are introduced
§ Paradigm – Changes in the underlying mental & business
models
1’ 40’’: IBM's Process
Innovation for Healthcare
28
https://www.youtube.com/watch%3Fv=IFerjdndiRU
01/03/2020
15
Planning for New Products/Services
29
Planning for New Products/Services
Innovation Lifecycle Management
INTRODUCTION GROWTH MATURITY DECLINE
EXTENSION
SA
LE
S
30
01/03/2020
16
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Make an Extension Plan for:
Typing machine
INTRODUCTION GROWTH MATURITY DECLINE
EXTENSION
SA
LE
S
31
New Product/Service Development Process
32
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17
New Product/Service Development Process
33
New Product/Service Development Process
Collaborative Innovation
34
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18
New Product/Service Development Process
Collaborative Innovation
Blut, M., Heirati, N., & Schoefer, K. (2019). The Dark Side of
Customer Participation: When Customer Participation in Service
Co-Development Leads to Role Stress. Journal of Service
Research, 1094670519894643.
Heirati, N., & Siahtiri, V. (2019). Driving service
innovativeness via collaboration with customers and suppliers:
Evidence from
business-to-business services. Industrial Marketing
Management, 78, 6-16.
Heirati, N., O'Cass, A., Schoefer, K., & Siahtiri, V. (2016). Do
professional service firms benefit from customer and supplier
collaborations in competitive, turbulent environments?.
Industrial Marketing Management, 55, 50-58.
35
Reality in Many Organisations
The End. Have Fun!
36
01/03/2020
19
Reading Resources
Chapters 12: Hooley, G., Piercy, N. F., and Nicoulaud, B.
(2017), Marketing Strategy & Competitive
Positioning, Prentice Hall, 6th Edition.
Anthony, S. D., Eyring, M., & Gibson, L. (2006). Mapping your
innovation strategy. Harvard Business Review,
84(5), 104-13.
Blut, M., Heirati, N., & Schoefer, K. (2019). The Dark Side of
Customer Participation: When Customer
Participation in Service Co-Development Leads to Role Stress.
Journal of Service Research,
1094670519894643.
Calantone, R. J., Schmidt, J. B., & Song, X. M. (1996).
Controllable factors of new product success: A cross-
national comparison. Marketing Science, 15(4), 341-358.
Heirati, N., & Siahtiri, V. (2019). Driving service
innovativeness via collaboration with customers and
suppliers: Evidence from business-to-business services.
Industrial Marketing Management, 78, 6-16.
Heirati, N., O'Cass, A., Schoefer, K., & Siahtiri, V. (2016). Do
professional service firms benefit from
customer and supplier collaborations in competitive, turbulent
environments?. Industrial Marketing
Management, 55, 50-58.
Pisano, G. P. (2015). You need an innovation strategy. Harvard
Business Review, 93(6), 44-54.
Szymanski, D. M., Kroff, M. W., & Troy, L. C. (2007).
Innovativeness and new product success: Insights from
the cumulative evidence. Journal of the Academy of Marketing
Science, 35(1), 35-52.
37
Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Gillette case study
situation analysis
Week 3 - Competitive market analysis Gillette case study
situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Gillette case study SWOT analysis
Week 5 - Segmentation, positioning, and selecting target
markets
Gillette case study problem identification &
alternative strategies provision
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix Using metaphors in
marketing campaigns
Week 8
- Competing through superior service and customer
relationships
Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10
- Ethics and social responsibility in marketing strategy
- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
38
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1
MAN3106 Marketing Strategy
Competitive Market Analysis
1
2
24/02/2020
2
Announcements
Frequently Asked Questions:
1. How will we meet the independent study assessment criteria
which states that
there must be evidence of “extensive independent reading using
a wide range of
carefully selected sources”. How will we meet the knowledge
assessment criteria
which states there must be evidence of “thorough integration
and application of a
full range of appropriate principles, theories, evidence and
techniques.” However
how can we do all these things without referencing
theories/principles.
2. For the situational analysis, how can we thoroughly and to a
high level analyse
without conducting our own research.
3. If we want to use theories and concepts do we reference these
even though we
will not receive marks for them. Also, should these be
referenced using in-text
citations along with our reference list, and will these in-text
citations be part of the
word count?
3
Relevance
Market analysis…
§ is one of the most important tasks
because all decision making and
planning depends on how well the
analysis is conducted
§ should be an ongoing, systematic
effort that is well organised and
supported by sufficient resources
§ should provide as complete a
picture as possible about the
organisation’s current and future
situation with respect to the
internal and external environment
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3
Main Topics
1. Introduction
2. Analysis of the External Macro-Environment
3. Analysis of the External Micro-Environment: Customer
Analysis
4. Analysis of the External Micro-Environment: Competitor
Analysis
5
1
Introduction to Competitive Market Analysis
6
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4
Unit of Analysis in Market Analysis
Unit of
Analysis
External
Environment
Macro-
Environment
Micro-
Environment
Internal
Environment
7
Conducting a Situation Analysis
Analysis alone is not a solution
Data is not the same as information
§ Data – a collection of numbers or facts that
have the potential to provide information
§ Information – data that have been
transformed or combined with other data in
a manner that makes them useful to decision
makers
Conducting a situation analysis is a
challenging exercise
§ Should provide a complete picture of three
key environments: Internal, Customer, and
External
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5
Collecting Marketing Information
Types of Data
§ Secondary data – data can be collected from a wide array of
internal,
government, periodical, book, and commercial sources
(secondary
research)
§ Primary data – data can be collected through studies in the
form of direct
observation, focus groups, surveys, or experiments (primary
research)
Typical Problems in Data Collection
§ Incomplete or inaccurate assessment of the situation that the
data should address
§ Severe information overload
§ Time and expense of collecting data
§ Data integration
9
Primary Data: Marketing Research Methods
10
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Primary Data: Marketing Research Methods
Qualitative methods: Observation, interview, focus group, etc.
11
Primary Data: Marketing Research Methods
Quantitative methods: Experiment, survey, etc.
12
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7
Analysis of the internal environment [to be covered next
lectures]
Review of current marketing objectives, strategy, and
performance
§ What are the current marketing goals and objectives?
§ How are current marketing strategies performing with respect
to anticipated
outcomes?
Review of current and anticipated organisational resources
§ What is the state of current organisational resources?
§ Are these resources likely to change for the better or worse in
the near future?
§ If the changes are for the better, how can these added
resources be used to better
meet customers’ needs?
Review of current and anticipated cultural and structural issues
§ What are the positive and negative aspects of the current and
anticipated
organisational culture?
§ What issues related to internal politics or management
struggles
might affect the marketing activities?
13
Analysis of the External Macro-Environment
2
14
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8
PESTEL Analysis
15
Economic Growth and Stability
Economic change is inevitable and has a profound impact on
marketing
strategy.
General Economic Conditions
§ Inflation, employment, income, interest rates, taxes, trade
restrictions, tariffs,
business cycle
Consumer Issues
§ Willingness to spend, confidence, spending patterns
An Underreported Economy
§ The U.S. economy is dominated by intangibles such as
services and information.
§ Innovation, creativity, and human assets are not counted in
yearly GDP statistics.
16
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9
Economic Growth and Stability
17
Political, Legal, and Regulatory Issues
The views of elected officials can affect marketing strategy.
§ Example hot-button issues: tobacco, immigration, taxes,
retirement, healthcare
§ Lobbying is vital to marketing strategy in highly regulated
industries.
Firms must abide by the law, but many laws are vague and
difficult to enforce.
§ e.g. court decisions, corporate governance, trade agreements
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10
Technological Advancements
Technology refers to the processes used to create “things”
considered to be new.
Frontstage Technology
§ Advances that are noticeable to customers…what customers
think of when they think of technological advancements
§ e.g. smartphones, GPS, microwave ovens
Backstage Technology
§ Advances that are not noticeable to customers…these
advances make marketing activities more efficient and
effective
§ e.g. computer technology, RFID, near-field communication
Gartner’s Top 10 Strategic
Technology Trends for 2020
19
Technological Advancements
Product lifecycle
Industry evolution
(lifecycle)
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11
Sociocultural Trends
Social and cultural influences that cause changes in attitudes,
beliefs, norms, customs, and lifestyles
Sociocultural forces can have a profound effect on the way
customers live and buy products.
Changes in customer demographics and values have a
considerable impact on marketing.
Example Trends in the U.S. Sociocultural Environment
§ Demographic Trends
- Aging of the American population
- Population growth in Sun Belt states
- Increasing population diversity
§ Lifestyle Trends
- Many Americans are postponing retirement
- Clothing becoming more casual, especially at work
- Time spent watching television and reading newspapers has
declined
§ Value Trends
- Greater focus on ethics and social responsibility
- Shorter attention spans and less tolerance for waiting
- Growing skepticism about business
21
Sociocultural Trends
Growth in the Number of Older Americans
22
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12
Measuring PESTLE Impact
23
Measuring PESTLE Impact
24
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13
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
What about geographical factors analysis?
Gillette Tag Weather – 2’ 21’’:
www.youtube.com/watch?v=8HoA6IhBhyw
25
25
Analysis of the External Micro-Environment:
Customer Analysis
3
26
http://www.youtube.com/watch%3Fv=8HoA6IhBhyw
24/02/2020
14
Analysis of the External Micro-Environment
Customer analysis
§Discussed in Seminar Week 2
§More discussions in Week 5
§Consumer, purchaser, and
decider are not always the
same person
§e.g. Nappies!
27
Three Tiers of Noncustomers
28
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15
Analysis of the External Micro-Environment:
Competitor Analysis
4
29
Analysis of the External Micro-Environment
Competitor analysis
§ Industrial organisation
(IO) economics
perspective
§ Porter’s Five Forces
Model: Five forces
determine the
competitive intensity
(and attractiveness) of
an industry in terms of
profitability
30
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16
Porter’s 5 Forces Analysis
Five Forces Analysis assumes that there are five important
forces that
determine competitive power in a business situation.
§ Supplier Power
- Here you assess how easy it is for suppliers to drive up prices
- The fewer the supplier choices you have, and the more you
need suppliers' help,
the more powerful your suppliers are
§ Buyer Power
- Here you ask yourself how easy it is for buyers to drive prices
down – How much is
the customer’s switching cost
- If you deal with few, powerful buyers, then they are often able
to dictate terms to
you
31
Porter’s 5 Forces Analysis
§ Threat of Substitution
- This is affected by the ability of your customers to find a
different way of doing what you
do – for example, if you supply a unique software product that
automates an important
process, people may substitute by doing the process manually or
by outsourcing it
§ Threat of New Entry
- If it costs little in time or money to enter your market and
compete effectively
- If there are few economies of scale in place, or if you have
little protection for your key
technologies, then new competitors can quickly enter your
market and weaken your
position
§ Competitive Rivalry
- What is important here is the number and capability of your
competitors
- If you have many competitors that offer equally attractive
products/services, then you'll
most likely have little power, because buyers will go elsewhere
if they don't get a good deal
from you
32
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17
Porter’s 5 Forces Analysis
33
Porter’s 5 Forces Analysis
34
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18
The components of competitor analysis
35
The components of competitor analysis
Competitor Objectives
§ Brand Competitors – Market products with similar features
and benefits to the same
customers at similar prices
§ Product Competitors – Compete in the same product class, but
with products that are
different in features, benefits, and price
§ Generic Competitors – Market different products that satisfy
the same basic customer need
§ Budget Competitors – Compete for the limited financial
resources of the same customers
36
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19
Major Types of Competition
37
The components of competitor analysis
Competitor Strategies
38
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20
The components of competitor analysis
Competitor Resources/Capabilities
39
Learning from Competitors
40
24/02/2020
21
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Of the three major environments in a situation
analysis (internal, customer, external), which do
you think is the most important in a general
sense? Why? What are some situations that would
make one environment more important than the
others?
41
Reality in Many Organisations
The End. Have Fun!
42
24/02/2020
22
Reading Resources
Chapters 2, 3, & 4: Hooley, G., Piercy, N. F., and Nicoulaud, B.
(2017), Marketing Strategy &
Competitive Positioning, Prentice Hall, 6th Edition.
Chapter 3: Ferrell, O. C. and Hartline M. D. (2014), Marketing
Strategy, Cengage, 6th Edition.
Chen, M. J. (1996). Competitor analysis and interfirm rivalry:
Toward a theoretical integration.
Academy of Management Review, 21(1), 100-134.
Grundy, T. (2006). Rethinking and reinventing Michael Porter's
five forces model. Strategic
Change, 15(5), 213-229.
Kim, W. C., & Mauborgne, R. (2014). Blue ocean strategy,
expanded edition: How to create
uncontested market space and make the competition irrelevant.
Harvard Business Review
Press.
Menon, A., Bharadwaj, S. G., Adidam, P. T., & Edison, S. W.
(1999). Antecedents and
consequences of marketing strategy making: a model and a test.
Journal of Marketing, 63(2),
18-40.
Porter, M. E. (2008). The five competitive forces that shape
strategy. Harvard Business Review,
86(1), 25-40.
43
Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Gillette case study
situation analysis
Week 3 - Competitive market analysis Gillette case study
situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Gillette case study SWOT analysis
Week 5 - Segmentation, positioning, and selecting target
markets
Gillette case study problem identification &
alternative strategies provision
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix Using metaphors in
marketing campaigns
Week 8
- Competing through superior service and customer
relationships
Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10
- Ethics and social responsibility in marketing strategy
- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
44
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1
MAN3106 Marketing Strategy
Module Objectives & Structure
Introduction to Marketing Strategy
1
Hello!
Nima Heirati
Associate Professor in Marketing
Research: Innovation Strategy, Service Marketing,
Business Relationships, and Customer Experience
e.g., Organizational ambidexterity, Innovation
strategy in emerging economies, Dark side of
business relationships, Servitization
Anastasios Siampos
Senior Teaching Fellow in Marketing
Research areas: Marketing strategy,
Entrepreneurship
2
10/02/2020
2
Aims/Objectives
By the end of this session, you will be able to:
§ Identify the module learning objective
§ Why does this module matter?
§ Reading resources
§ Comprehend the teaching style, students’ responsibilities, and
assessment criteria
3
What is this module about?
Founded in 2008
191+ countries
100k+ cities
500m guest arrivals
approx. $30 billion value
4
10/02/2020
3
What is this module about?
Founded in 1706
115 countries
198 blends of teas
approx. 7 billion cups/year
5
What is this module about?
Marketing strategy
… is a market-driven process of strategy development and
considers a constantly
changing business environment and the need to deliver superior
customer value. It
is focused on increasing organisational performance, links the
organisation with the
environment, and conceives marketing as a responsibility of the
entire business
rather than a specialised function (Cravens & Piercy 2013).
… has the fundamental goal of increasing sales and achieving a
sustainable
competitive advantage (Ferrell & Hartline 2014).
6
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4
Why does it matter?
§ It is interesting
Strategic marketing builds on insights from various disciplines
including psychology, sociology, economics, etc.
§ It is challenging
Strategic marketing requires consideration of a wide range of
factors. These factors interact and they are subject to change.
§ It is important
Strategic marketing is concerned with how organisations
create, communicate, deliver, and capture value and, as such,
has important performance implications.
7
Knowledge & Learning Outcomes
By the end of this module, students should:
§ Synthesise knowledge of marketing strategy and apply
concepts to case
studies.
§ Accurately identify and apply relevant theory within different
contexts
§ Critically evaluate various marketing approaches and
application of
strategy within a specific context
§ Identify and analyse marketing problems through the use of
case studies
§ Understand the use of a Strategic Marketing Plan
§ Organise and communicate ideas clearly
8
10/02/2020
5
Teaching Pattern
11 weeks of two-hour lectures
§ The basic concepts and theories of the textbook will be
introduced, in addition to
the materials that go beyond the textbook and are relevant for
the exam.
11 weeks of one-hour seminars
§ Students will be assigned to a seminar group via timetable
automatically.
§ Seminars intend to ensure a comprehensive understanding of
the topic area and
to make sure that students are be able to detect and transfer
learned concepts to
practice.
Students are in control of their learning in this module
§ To take most advantages of each class, you must be prepared
§ Students are expected to participate actively and positively in
the
teaching/learning environment
9
Learning Resources
Essential Reading
§ Hooley, G., Piercy, N., and Nicoulaud, B. (2017), Marketing
Strategy & Competitive
Positioning, Prentice Hall, 6th Edition.
§ Hooley, G., Nicoulaud, B., Rudd, J., and Lee, N. (2020),
Marketing Strategy &
Competitive Positioning, Prentice Hall, 7th Edition.
Complementary learning resources
§ Ferrell, O., and Hartline M. D. (2014), Marketing Strategy,
Cengage, 6th Edition.
§ Lynch, R. (2018) Strategic Management, Pearson, 8th Edition.
§ McDonald, M., and Wilson, H. (2016). Marketing Plans: How
to prepare them, how
to profit from them. John Wiley & Sons, 8th Edition.
§ Apart from textbooks, students will find it valuable to get into
the practice of
reading relevant articles from academic journals, magazines,
and websites.
Surrey Learn
§ The lecture notes, PowerPoint slides, details of assessments
and other information,
together with important announcements, will be available on
Surrey Learn.
10
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6
Assessment
Coursework 50%. Each student should analyse a case study
following the framework and
guidelines provided through lectures and seminars (MAXIMUM
1500 words).
§ This case study analysis report will allow students to go
beyond what was learned in
class and learn how to develop marketing strategies for a real-
world case study.
Exam 50%. Closed book exam (duration 120 minutes) based on
a case study provided in
advance of the examination. Students will be given a case study
in Week 10 via
SurreyLearn. At the end of the case study, FOUR essay
questions will be provided.
§ You cannot bring your own case study in the exam. During the
exam, you will be given
a new but identical copy of the case study along with FOUR
questions. Out of the FOUR
questions, you will have to answer TWO questions (50% each).
You must answer the
questions based on the information on the case study (i.e., not
further search or
market stats is required).
Type Weighting Details Due Date
Coursework 50% 1500 words individual assignment 23rd March
2020
Exam 50% 2-hour closed book exam Examination period
11
Plan for Seminars Week 1-7
Seminars intend to ensure a comprehensive understanding of the
topic area
and to make sure that students are able to apply learned
concepts to
practice. Preparation and active participation in seminars will
be expected.
§ Student will have the opportunity to practice analysing an
example case
study during Weeks 1 to 7.
§ Please print and review “CASE STUDY 10.3: Global ice
cream wars” from
Lynch, R. (2018) Strategic Management, Pearson, 8th Edition –
pp. 351-355.
§ Students have online access to this textbook via the university
library website
§ Students will be given a different case study for the individual
assignment
in Week 3 via SurreyLearn.
§ Students will be given a different case study for the exam in
Week 9 via
SurreyLearn.
12
10/02/2020
7
Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Example case study –
Situation analysis
Week 3 - Competitive market analysis Example case study –
Situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Example case study – SWOT analysis &
problem identification
Week 5 - Segmentation, positioning, and selecting target
markets Example case study – Alternative strategies
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix
Example case study – Implementation &
control
Week 8 - Competing through superior service and customer
relationships Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10 - Ethics and social responsibility in marketing
strategy- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
13
Introduction to Marketing Strategy
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8
Main Topics
1. Basic concepts and framework
§ Markets and exchange
§ The strategic triangle and competitive advantage
2. Marketing in today’s economy
3. Component and context of market orientation
4. The role of marketing in the organisation
15
Market, exchange, and product
What is a market?
§ Collection of buyers (e.g. consumers, private households) and
sellers (e.g. firms,
institutions)
§ A space where supply meets demand
Considers physical marketplaces (e.g. traditional farmer’s
market)
Considers virtual marketspaces (e.g. online retail platforms)
16
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9
Market, exchange, and product
What is exchange?
§ The process of obtaining something of value from someone by
offering something
in return – Five conditions:
§ There must be at least two actors to the exchange
§ Each actor has something of value to the other actor
§ Each actor must be capable of communication and delivery
§ Each actor must be free to accept or reject the exchange
§ Each actor believes that it is desirable to exchange with the
other actor
17
The strategic triangle and competitive advantage
18
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10
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
Increasing customer power is a
continuing challenge to marketers in
today’s economy. In what ways have
you personally experienced this shift
in power; either as a customer or as a
business person? Is this power shift
uniform across industries and
markets? How so?
19
Marketing in Today’s Economy
All organisations require effective planning and a sound
marketing strategy to
achieve their goals and objectives
Today’s Economy:
§ Most of industries are becoming mature, where slowing
innovation, extensive
product assortment, excess supply, and frugal consumers force
margins to the
floor
§ Today’s economy is characterised by rapid technological
change, economic
anxiety, and increasing consumer scepticism
Is there any key
technological difference?
20
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11
Major Challenges vs Opportunities
Power shift to customers – e.g. Amazon empowers searching for
the best deal
Massive increase in product selection – e.g. Car Industry
Audience and media fragmentation – e.g. Customer can find
next offer in one click – Social
media influences consumer behaviour
Changing value propositions & demand pattern – e.g. digital vs
printed books
Privacy, security, and ethical concerns
Globalisation
Change in Daily Media Usage by
U.S. Adults, 2008-2011
21
Components and context of market orientation
§ Market Orientation is a philosophy of decision making
focused on customer
needs
§ Market Orientation represents the set of organisational-wide
behaviour that
enables a firm to generate and disseminate market intelligence
among its
employees and to utilise market intelligence to respond to
customer needs
§ Decisions grounded in analysis of the target customers
§ Result:
§ Developing new products/service that
customers are looking for
§ Increased creativity
§ Improved new product performance
22
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Components and context of market orientation
Customers do not want a 1/4“ drill, they want to hang a picture
on the wall!
§ Value Matters: Innovation Has Direction
5’ 12’’: Value Matters: Innovation Has Direction
Customer/Value DrivenProduct Driven
23
Components and context of market orientation
Marketing and performance outcomes
24
https://www.youtube.com/watch%3Fv=-se_wEJ_KM4
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Different Market Orientation Approaches
Responsive vs. Proactive Market Orientation
Customers
Focus
Proactive
MO
Responsive
MO
Expressed
customer needs
Current
competitive threats
Latent and future
customer needs
Anticipated
competitive threats
Competitors
Focus
25
Assessing a Firm’s Market Orientation
¨ Responsive Market Intelligence Generation (Rank 1 to 7)
§ This firm continuously works to better understand of our
customers’ needs.
§ This firm pays close attention to after-sales service.
§ This firm measures customer satisfaction systematically and
frequently.
§ This firm wants customers to think of us as allies.
§ Employees throughout the organisation share information
concerning competitors’ activities.
§ Top management regularly discusses competitor’s strengths
and weaknesses.
§ This firm tracks the performance of key competitors.
§ This firm evaluates the strengths and weaknesses of key
competitors.
¨ Proactive Market Intelligence Generation (Rank 1 to 7)
§ This firm continuously tries to discover additional needs of
our customers of which they are unaware.
§ This firm incorporates solutions to unarticulated customer
needs in its new products and services.
§ This firm brainstorms about how customers’ needs will
evolve.
§ This firm works with lead users, customers who face needs
that eventually will be in the market.
§ This firm tries to anticipate the future moves of our
competitors.
§ This firm monitors firms competing in related
product/markets.
§ This firm monitors firms using related technologies.
§ This firm monitors firms already targeting our prime market
segment but with unrelated products.
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The role of marketing in the organisation
27
© 2014 Cengage Learning. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible
website, in whole or in part.
It is argued that marketing possesses
very few rules for choosing the
appropriate marketing activities.
Can you describe any universal
rules of marketing that might be
applied to most products, markets,
customers, and situations?
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The Challenges of Marketing Strategy
§ Unending Change
§ People-Driven Nature of Marketing
§ Lack of Rules for Choosing Marketing Activities
§ Increasing Customer Expectations
§ Declining Customer Satisfaction and Brand Loyalty
§ Competing in Mature Markets
§ Increasing commoditisation
§ Little real differentiation among product offerings
§ Aggressive Cost-Cutting Measures
29
Reality in Many Organisations
The End. Have Fun!
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Reading Resources
Chapter 1: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017),
Marketing Strategy &
Competitive Positioning, Prentice Hall, 6th Edition.
Chapter 1: Ferrell, O. C. and Hartline M. D. (2014), Marketing
Strategy, Cengage, 6th
Edition.
Kotler, P. (2011). Reinventing marketing to manage the
environmental imperative. Journal
of Marketing, 75(4), 132-135.
Morgan, N. A. (2012). Marketing and business performance.
Journal of the Academy of
Marketing Science, 40(1), 102-119.
Varadarajan, R. (2010). Strategic marketing and marketing
strategy: Domain, definition,
fundamental issues and foundational premises. Journal of the
Academy of Marketing
Science, 38(2), 119-140.
31
Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Example case study –
Situation analysis
Week 3 - Competitive market analysis Example case study –
Situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Example case study – SWOT analysis &
problem identification
Week 5 - Segmentation, positioning, and selecting target
markets Example case study – Alternative strategies
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix
Example case study – Implementation &
control
Week 8 - Competing through superior service and customer
relationships Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10 - Ethics and social responsibility in marketing
strategy- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
32
Individual Assignment Brief
MAN3106 Marketing Strategy – Semester 2 2019-20
Submission Due: 23/03/2020 – Word limit: 1500 words
Students should critically analyse the case study “Gillette: Why
Innovation Might not
be Enough” following the framework introduced in the
lectures/seminars to identify 1-
2 key challenges/problems in the case and to recommend and
justify alternative
marketing strategies. You must analyse the case study based on
the information on
the case. This means that even if you do your own research (e.g.
you find some
additional data about market trends), and you use such
information, you will not
receive a mark for that. The school’s assessment criteria are
provided in Appendix I
at the end of Module Handbook. All five assessment criteria in
the Module Handbook
are relevant to this individual assignment.
Structure of the Individual Assignment
§ Executive summary – around 200 words-not included in the
word count
§ Table of contents – not included in the word count
§ Situational analysis (20% of the mark) – Macro environment,
industry,
competitors, & customer environment – around 350 words
§ Internal environment & SWOT analysis (20% of the mark) –
around 350 words
§ Evaluation of current strategies and problem statement (30%
of the mark) –
400 words
§ Alternative strategies proposition, evaluation, & justification
(30% of the mark)
– around 400 words
§ Reference list (if necessary – not included in the word count)
NOTE. Word limit excludes executive summary, table of
contents, references, tables,
figures, and appendices. All coursework should be submitted
electronically in Word
format only. Penalties: Any work submitted over the word limit
will be marked in full,
but the assignment will be penalised by 10 marks.
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MAN3106 Marketing Strategy
Case Study Analysis Framework
1
Assessment
Coursework 50%. Each student should analyse a case study
following the framework and
guidelines provided through lectures and seminars (MAXIMUM
1500 words).
§ This case study analysis report will allow students to go
beyond what was learned in
class and learn how to develop marketing strategies for a real-
world case study.
Exam 50%. Closed book exam (duration 120 minutes) based on
a case study provided in
advance of the examination. Students will be given a case study
in Week 9 via
SurreyLearn.
§ You cannot bring your own case study in the exam. During the
exam, you will be given
a new but identical copy of the case study along with FOUR
questions. Out of the FOUR
questions, you will have to answer TWO questions (50% each).
You must answer the
questions based on the information on the case study (i.e., not
further search or
market stats is required).
Type Weighting Details Due Date
Coursework 50% 1500 words individual assignment 23rd March
2020
Exam 50% 2-hour closed book exam Examination period
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Plan for Seminars Week 1-7
Seminars intend to ensure a comprehensive understanding of the
topic area
and to make sure that students are able to apply learned
concepts to
practice. Preparation and active participation in seminars will
be expected.
§ Student will have the opportunity to practice analysing an
example case
study during Weeks 1 to 7.
§ Please print and review “CASE STUDY 10.3: Global ice
cream wars” from
Lynch, R. (2018) Strategic Management, Pearson, 8th Edition –
pp. 351-355.
§ Students have online access to this textbook via the university
library website
§ Students will be given a different case study for the individual
assignment
in Week 3 via SurreyLearn.
§ Students will be given a different case study for the exam in
Week 9 via
SurreyLearn.
3
Structure of Individual Assignment
§ Executive summary – around 200 words-not included in the
word count
§ Table of contents – not included in the word count
§ Situational analysis (20% of the mark) – Macro environment,
industry,
competitors, & customer environment – around 350 words
§ Internal environment & SWOT analysis (20% of the mark) –
around 350
words
§ Evaluation of current strategies and problem statement (30%
of the mark)
– 400 words
§ Alternative strategies proposition, evaluation, & justification
(30% of the
mark) – around 400 words
§ Reference list (if necessary – not included in the word count)
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Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Example case study –
Situation analysis
Week 3 - Competitive market analysis Example case study –
Situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Example case study – SWOT analysis &
problem identification
Week 5 - Segmentation, positioning, and selecting target
markets Example case study – Alternative strategies
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix
Example case study – Implementation &
control
Week 8
- Competing through superior service and customer
relationships
Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10
- Ethics and social responsibility in marketing strategy
- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
5
What is the Case Study
Case studies (or case reports) are written by academics and
professional
focusing on actual problems and decisions companies face.
§ Most articles about companies in magazines and newspapers
such as The Wall
Street Journal, Business Week, Fortune, Harvard Business
Review, and Forbes are
mini-cases.
§ This is not a substitute for real world experience in a job with
an organisation, but
it is an effective and practical type of learning.
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The Analysis Framework
§ Case studies offer stories, including facts, opinions,
projections, results,
expectations, plans, policies, and programs.
§ A systematic approach (or framework) is required to structure
and analyse
presented information within a case study.
§ Benefits of having a framework to analyse:
§ Comprehensive coverage
§ Ease of communication
§ Consistency of analysis
7
Tips Before Analysis!
§ No one can analyse a case study after reading it only one
time, or even
worse, doing the analysis during the first reading of the case.
§ Do not get trapped into thinking the “answer” to the case
study is hidden
somewhere in the case text.
§ Make an effort to put yourself in the shoes of the decision
maker in the case
study.
8
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5 Step Case Analysis Framework
Step 1: Situation Analysis (Macro environment - Industry,
Competitors, & Customer
environment)
Step 2: Internal Environment Analysis
Step 3: Problem(s) Statements and Setting Objectives
Step 4: Alternative Strategies Proposition, Evaluation, &
Justification
Step 5: Implementation Plan/Actions and Control Mechanisms
9
Step 1: Situation Analysis
Organising the pieces of information into more useful topic
blocks:
§ PESTLE analysis
§ Industry and competitors analysis (Porter’s 5 forces –
Competitors’
weaknesses & strength)
§ Customer analysis (Market potential – Market segmentation
demographics and preferences – Main target customers)
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Step 1: Situation Analysis – Measuring PEST Impact
11
Step 1: Situation Analysis – Industry & Competitors
Industry and competitors analysis
§ Porter’s 5 forces
§ Competitors’ weaknesses & strengths
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Porter’s 5 Forces Analysis – Industry & Competitors
13
Step 1: Situation Analysis – Customers
Customer analysis
§ Market potential
§ Market segmentation demographics and preferences
§ Main target customers
- Who are our Current and Potential Customers?
- What do Customers do with our Products/Services?
- Where/When do Customers Purchase our Products/ Services?
- Why (and How) do Customers Select our Products/ Services?
- Why do Potential Customers not Purchase our Products/
Services?
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Step 1: Situation Analysis – Customers
Three Tiers of Noncustomers
15
Step 2: Internal Analysis
Identify the Company’s Generic Competitive Strategy Type
Overall Low-Cost
Leadership Strategy
Broad Differentiation
Strategy
Focused Differentiation
Strategy
Focused Low-Cost
Strategy
Hybrid Strategy
A Broad Cross-
section of
Buyers
Market Niche
M
ar
ke
t T
ar
ge
t
Type of Competitive Advantage Being
Pursued
Lower Cost Differentiation
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Step 2: Internal Analysis
SWOT Analysis
17
Step 2: Internal Analysis
A four-cell array used to make a conclusion of SWOT analysis
§ Should be based on customer perceptions, not the perceptions
of the manager or
firm
§ Elements with the highest total ratings should have the
greatest influence in
developing the strategy.
§ Focus on competitive advantages by matching strengths with
opportunities
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Step 3: Problem(s) Statements and Setting Objectives
Only a problem properly defined can be addressed
The proper definition of the problem(s) facing the company is
the most critical
part of the analysis
§ Define the problem too narrowly, or miss the key problem,
and all subsequent
framework steps will be off the mark
§ Getting a clear picture of the problem is one major benefit
derived from PEST,
industry environment, customer environment, and SWOT
analyses
19
Step 3: Problem(s) Statements and Setting Objectives
Problem Identification Process
§ The process of identifying problems is similar to the one
people go through with
their doctors
- A nurse or assistant comes in to conduct a strength and
weakness assessment on a
patient
- The patient’s vital signs are taken and the patient is asked
about any symptoms
§ Symptoms are observable indications
- Symptoms are not the problem themselves
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Input Question
The problem is that sales have declined. → Why have sales
declined?
Sales have declined because there are too many sales
territories that are not assigned to a salesperson.
→ Why are so many sales territories
unassigned?
Sales territories are unassigned because sales force turnover
has doubled in the past year. → Why has sales force turnover
doubled?
Turnover began to increase over a year ago when the sales
force compensation plan was altered to reduce variable
expenses.
→ Why….
* When a student can no longer devise a meaningful response to
the Why question, the problem is
probably revealed. In this instance, the problem statement might
read:
Conclusion: The current sales force compensation plan at XYZ
Company is inadequate to retain an
acceptable percentage of the firm’s salespeople, resulting in lost
customers and decreased sales.
Step 3: Problem(s) Statements and Setting Objectives
21
Step 4: Alternative Strategies Proposition, Evaluation, &
Justification
Strategy formulation involves the identification of alternative
strategies, a
review of the merits of each of these options and then selecting
the strategy
that has the best fit with a company’s trading environment, its
internal
resources and capabilities.
§ Strategies are agreed to be most effective when they support
specific business
objectives – e.g. increasing the online contribution to revenue,
or increasing the
number of online sales enquiries.
§ A useful technique to help align strategies and objectives is to
present them
together in a table, along with the insight developed from
situation analysis
which may have informed the strategy.
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12
Step 5: Implementation Plan/Actions and Control Mechanisms
Implementation plan/actions
§ Implementation includes actions to be taken, the sequencing
of marketing
activities, and a time frame for their completion
- First, students should explain the actions should be taken to
implement alternative
strategies. In doing so, describe any necessary internal
marketing activities such as:
– Employee training, employee buy-in and motivation to
implement the
marketing strategy, etc
- Second, a timeline (e.g., Gantt chart, schedule planning table)
should be provided
in directing the implementation actions
§ Tip: Review literature related to Balanced Scorecards
23
Step 6: Implementation Plan/Actions and Control Mechanisms
Control Mechanisms & KPIs
§ Specify the types of input controls/objectives that must be in
place before the
marketing plan can be implemented
- e.g., financial resources, additional R&D, additional HR
§ Specify the types of process controls/objectives that will be
needed during the
execution of the marketing plan
- e.g., management training, management commitment to the
plan, revised
employee evaluation/compensation systems, internal
communication activities
§ Specify overall performance standards/objectives
- e.g., sales volume, market share, profitability, customer
satisfaction, customer
retention
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13
Conclusion
5 Step Framework
§ Step 1: Situation Analysis (Macro environment - Industry,
Competitors, & Customer
environment)
§ Step 2: Internal Environment Analysis
§ Step 3: Problem(s) Statements and Setting Objectives
§ Step 4: Alternative Strategies Proposition, Evaluation, &
Justification
§ Step 5: Implementation Plan/Actions and Control Mechanisms
25
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1
MAN3016: Marketing Strategy
Lecture 2: Strategic Planning Process
Dr Anastasios Siampos
1
Like us on Facebook: www.facebook.com/sbsmrm/
Visit us: www.surrey.ac.uk/department-marketing-retail-
management
1
Purpose of marketing strategy
To set the direction of the organisation and decide what
product/s & in which
markets the firm should invest its resources
To define how it is to create value to customers
To describe how it is to perform marketing activities (4/7Ps)
better than
competition
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2
Strategic Fit
3
3
Mission & Vision
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3
Mission & Vision
Mission Statement
– Answers… “What business are we in?”
– Clear and concise
– Explains the organisation’s reason for existence
• Who are we? Who are our customers? What is our operating
philosophy?
What are our core competencies or competitive advantages?
What are our
responsibilities with respect to being a good steward of our
human, financial,
and environmental resources?
Vision Statement
– Answers… “What do we want to become?”
– Tends to be future oriented
– Represents where the organization is headed
5
5
The interrelationship between marketing and corporate strategy
Corporate Strategy
•Specifying the organisation’ mission
•Allocation of resources across the
whole organisation
•Portfolio of activities for the
organisation
•Defining organisational objectives
Marketing Strategy
•Competing in a product market
•Selecting market segments
•Designing the mix
•Guides
•Directs
•Controls
•Co-ordinates
•Informs
•Achieves
•operationalises
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4
The Marketing Strategy Process
7
7
Where do we want to be? Strategic Decisions
8
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5
Product types in the portfolio
9
Balancing the business portfolio
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6
Unbalanced
11
11
Unbalanced
12
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7
SWOT
13
13
SWOT Strategic Implications
14
14
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8
Strategic Focus
15
15
Routes to competitive advantage
16
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9
Marketing Strategy – Two Perspectives
Marketing strategy at the functional level
Ø Planning and controlling the marketing activities
Ø Planning and implementing the 4Ps/7Ps
Ø Management customer relationship
Marketing as a philosophy/orientation
Ø Guiding the organisation’s overall activities
Ø Playing a key role in the strategic management process
(SMM)
17
Marketing Plan
A written document that provides the blueprint or outline of the
organization’s
marketing activities, including the implementation, evaluation,
and control of
those activities
ü How the organization will achieve its goals and objectives
ü Serves as a “road map” for implementing the marketing
strategy
ü Instructs employees as to their roles and functions
ü Provides specifics regarding the allocation of resources,
specific marketing
tasks, responsibilities of individuals, and the timing of
marketing activities
18
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10
Thinking First
Cognitively analysing a
strategic marketing
problem & developing
the solution (the
strategy) through a
carefully thought-out
process
It can help to see the big
picture occasionally
throughout the process.
It can involve some
inspiration & insight, but
largely the process is one
of painstakingly doing
your homework
West, D. C., et al. (2015). Strategic marketing: creating
competitive advantage. Oxford, United Kingdom, Oxford
University Press.
19
Seeing First
Importance of seeing the overall decision is sometimes greater
than thinking
about it
Insight often only comes after a period of preparation,
incubation, illumination &
verification in the cold light of day.
The 'eureka' moment
West, D. C., et al. (2015). Strategic marketing: creating
competitive advantage. Oxford, United Kingdom, Oxford
University Press.
20
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11
Doing First
(1) do something, (2) make sense of it
(3) repeat the successful parts & discard the rest.
Many companies have successfully diversified their businesses
by a process of figuring out what worked & what did not
Instead of marketing strategy –
the reality is often that ‘doing’ drives
West, D. C., et al. (2015). Strategic marketing: creating
competitive advantage. Oxford, United Kingdom, Oxford
University Press.
21
Simple Rules
How-to rules keeping managers organised to be able to seize
opportunities
Boundary rules help managers to pick the best opportunities
based geography, customers or technology
Priority rules are about allocating resources amongst competing
opportunities
Timing rules relate to the rhythm of key strategic processes
Exit rules are about pulling out from past opportunities
West, D. C., et al. (2015). Strategic marketing: creating
competitive advantage. Oxford, United Kingdom, Oxford
University Press.
22
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12
Process and Temporality and the 4 Main Approaches to
Competitive
Marketing Strategy
SIMPLE RULES SEEING FIRST
DOING FIRST THINKING FIRST
Long-Term
Short-Term
Experiential Cognitive
TE
M
P
O
R
A
LI
TY
PROCESS
West, D. C., et al. (2015). Strategic marketing: creating
competitive advantage. Oxford, United Kingdom, Oxford
University Press.
23
What to Choose?
ü Thinking First/Market Orientation works best when the issues
are clear, the data are
reliable, the context is structured, thoughts can be pinned down
& discipline can be
applied
ü Seeing First works best when many elements have to be
creatively applied,
commitment to solutions is key & communications across
boundaries are needed (e.g.
in NPD)
ü Doing First or simple rules work best when the situation is
novel & confusing,
complicated specifications would get in the way & a few simple
relationship rules can
help move the process forward
West, D. C., et al. (2015). Strategic marketing: creating
competitive advantage. Oxford, United Kingdom, Oxford
University Press.
24
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13
Reading Resources
Chapter 2: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017),
Marketing Strategy &
Competitive Positioning, Prentice Hall, 6th Edition.
Chapter 2: Ferrell, O. C. and Hartline M. D. (2014), Marketing
Strategy, Cengage, 6th
Edition.
Additional reference: West, D. C., et al. (2015). Strategic
marketing: creating competitive
advantage. Oxford, United Kingdom, Oxford University Press.
Dobni, C., and Luffman, G. (2000) Implementing marketing
strategy through a market
orientation. Journal of Marketing Management, 16(8), 895-916.
25
Teaching Schedule
Week Lectures Seminars
Week 1 - Introduction to the Module Case study analysis
framework
Week 2 - Strategic marketing planning Example case study –
Situation analysis
Week 3 - Competitive market analysis Example case study –
Situation analysis
Week 4
- Understanding the organisational resource base
- Competing through innovation
Example case study – SWOT analysis &
problem identification
Week 5 - Segmentation, positioning, and selecting target
markets Example case study – Alternative strategies
Week 6 - Creating competitive advantage Individual assignment
Q&A
Week 7 - Competing through marketing mix
Example case study – Implementation &
control
Week 8
- Competing through superior service and customer
relationships
Costs of customer loyalty
Week 9 - Strategy implementation and control Soft and hard
control measures
Week 10
- Ethics and social responsibility in marketing strategy
- Evolving topics in marketing strategy
Group discussion on CSR and crisis
management
Week 11 - Module Revision Exam preparation Q&A
26
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14
Thank you! Any Questions?
27
1
Generic Example of a Case Study Analysis Report
Executive Summary
This document outlines the structure of the case study analysis
report and the examples of basic
tables/figures that could be considered for different analyses.
The structure of these tables is
simple and easy to produce in WORD. Students are encouraged
to search for and use more
advanced frameworks, tables, and/or figures for each analysis.
This document also provides
generic guidelines and examples based on information provided
in the “Global ice cream wars”
case study.
In the executive summary, students can provide information
about the Unilever in the ice cream
market and a brief overview of the challenges discussed in the
case study. Brief information
about the industry emerging trends or the company’s
vision/mission can be indicated in the
executive summary. Executive summary should be no more than
200 words (not included in
the word count). Please use font size 12 for the main body of
the report and font size 10 for the
text in the tables and figures (i.e., similar to this example
report). Please do not use small fonts
in the main text and tables/figures.
Table of Contents
Contents Page(s)
Executive Summary 1
Table of Contents 1
Situation Analysis – Analysis of Macro Environment 2
Situation Analysis – Analysis of Industry Competition and
Competitors 3
Situation Analysis – Analysis of Customers 5
Internal Environment & SWOT Analysis 6
Evaluation of Current Strategies and Problem Statement 8
Alternative Strategies 9
References (optional) 10
2
Situation Analysis – Analysis of Macro Environment
Students should discuss key macro-environmental factors
identified in Table 1 that influence
the industry and the studied company in the case study. The
conclusion of this section should
be no more than 100 words. Identified factors can be presented
as bullet points. If there is no
information in the case study concerning a macro environment
factor (i.e., political), students
can leave the related row in the table blank. For instance,
students can discuss the importance
of ice cream global market growth and related opportunities for
Unilever.
Table 1. PESTLE Analysis
Macro-Level Factors Importance of key factors to the market or
the company
Political Macro-level information related to the government
actions that may affect the business environment,
such as tax policies, Fiscal policy, and trade tariffs.
XYZ
Economic Macro-level information related to inflation,
employment, income, interest rates, taxes, trade
restrictions, tariffs, business cycle, Willingness to
spend, confidence, and spending patterns.
e.g., Economic growth in many
countries results growing the
global market for ice cream
around 3 per cent annually.
Market growth represent an
opportunity for companies in this
industry.
Socio-cultural Macro-level information related to cultural
trends,
demographics, and population analytics.
XYZ
Technological Macro-level information related to innovations in
technology that may affect the operations of the
industry and the market favourably or unfavourably.
XYZ
Legal Macro-level information related to consumer laws,
safety standards, and labour laws. In some cases,
political and legal issues can be grouped in one
category.
XYZ
Environmental Macro-level information related to climate,
weather,
geographical location, global changes in climate,
environmental offsets.
XYZ
3
Situation Analysis – Analysis of Industry Competition and
Competitors
Students should discuss key micro-environmental factors that
affect the industry competitive
intensity and market attractiveness. Students should also
identify and assess the competitors in
the market. The conclusion of this section should be no more
than 200 words. This section
includes two analyses:
First, the degree of industry competitive intensity and market
attractiveness can be
assessed using Porter’s Five Forces framework. This framework
assesses the competitive
intensity and, therefore, the attractiveness (or lack of it) of an
industry in terms of its
profitability. An "unattractive" industry is one in which the
effect of these five forces reduces
overall profitability. For instance, the global ice cream market
is highly competitive due to
high intensity of rivalry and bargaining power of customers, but
it is attractive for existing
companies -Unilever- given the high barriers for entry, low
bargaining power of suppliers,
moderate threat of substitute products, and growing the market
size. This market is unattractive
for new and small companies because of the high intensity of
rivalry, bargaining power of
customers, and barriers to entry. Students can adopt different
templates (i.e., figures, tables) to
present this framework and provide the conclusion of the
analysis.
Table 2. Five Forces Analysis
Force Related Factors Assessment
Intensity of
rivalry
§ Number of competitors
§ Sustainable competitive advantage through innovation
§ Competition between online and offline organizations
§ Powerful competitors and level of advertising expense
High,
Moderate, or
Low
Threat of new
entrants
§ Patents & rights
§ Government policy such as sanctioned monopolies
§ Capital requirements
§ Economies of scale
§ Product differentiation
§ Brand equity & customer loyalty
§ Access to distribution channels
High,
Moderate, or
Low
Threat of
substitutes
§ Relative price performance of substitute
§ Buyer switching costs and ease of substitution
§ Perceived level of product differentiation
§ Number of substitute products in the market
§ Availability of close substitute
High,
Moderate, or
Low
Bargaining
power of
customers
§ Degree of dependency upon existing channels of distribution
§ Buyer switching costs
§ Buyer information availability
§ Availability of existing substitute products
§ Buyer price sensitivity
§ Differential advantage (uniqueness) of industry products
High,
Moderate, or
Low
Bargaining
power of
suppliers
§ Supplier switching costs relative to focal company switching
costs
§ Degree of differentiation of inputs
§ Impact of inputs on cost and differentiation
§ Presence of substitute inputs
§ Strength of distribution channel
§ Supplier competition
High,
Moderate, or
Low
4
Second, students should identify key competitors, analyse
competitors’ current and future
objectives (i.e., investment priorities), analyse competitors’
current strategies (i.e., current
target markets and marketing mix strategies), and competitors’
current resource profile (i.e.,
tangible and intangible assets, competitive advantage). Students
can adopt different templates
(i.e., figures, tables) to outline competitors and provide the
conclusion of the analysis. For
instance, Tables 3 outlined key competitors indicated in the
“Global ice cream wars” case
study. The conclusion of this table should discuss the position
of studied company (i.e.,
Unilever) in the market compared to its competitors, identify
main current competitors (i.e.,
largest, strongest), and predict emerging competitors or
emerging strategies of current
competitors.
Table 3. Competitor Analysis
Competitor Overview
Key success factors
Acquisition
strategy
Heavily
branded
product range
R&D
and
patents
Flexibility to
create new/local
flavours
Distribution
channel
Nestle (incl.
Dreyer and
Haagen Dazs in
USA, and
Scholler/
Mövenpick)
§ Brand competitor
– 15% world
market share
§ Target market:
Super-premium,
premium branded,
and regular.
++ +++ +++ +++ ++
Häagen Dazs –
rest of world
§ XYZ
§ XYZ n/a
* + + n/a -
Mars § XYZ
§ XYZ n/a ++ ++ n/a -
Baskin Robbins § XYZ
§ XYZ n/a + + n/a -
Other (i.e.,
Supermarket
brands)
§ XYZ
§ XYZ --- --- --- n/a -
Optional: Comparison with studied
company – Unilever +++ +++ +++ +++ +++
* n/a: No applicable – Not indicated in the case study.
5
Situation Analysis – Analysis of Customers
This section is the conclusion of multiple principles/frameworks
introduced in Chapter 4
(customer analysis), Chapters 7, 8, and 9
(Segmentation/Positioning/Selecting Target
Markets). For instance, please review Figure 4.2, Table 7.4,
Figure 9.3 across Chapters 4, 7,
and 9 in the core textbook (Holley et al. 2017, 6th Edition) in
order to define the segment’s
profile/characteristics. Please bear in mind that students may
need to use insights from the
company’s resource portfolio (as part of internal environment
analysis) before analysing and
completing Table 9.5 in Chapter 9. The conclusion of this
section should be no more than 100
words. In this section, students should:
§ define the customer segmentation criteria (e.g., see Table 4);
§ identify primary target markets, secondary target markets,
possibilities, and avoid target
markets; and,
§ evaluate the current studied company’s current segmentation,
positioning, and targeting
strategies for identified market segments.
Table 4. Customer segmentation by price and quality
Segments Segment Profile/Characteristics
*
(Who? What? Where?)
Segment Preferences
(What? Why? How? When? Where?)
Primary target:
Premium branded
§ Lower-upper and upper-middle
social classes
§ Mainly customers from developed
economies (e.g., US and UK)
§ Relatively customers from
developing economies (e.g., South
Africa, China)
§ Good quality ingredients with individual, well-
known branded names, such as Mars, Magnum
and Extrême
§ Prices set above regular and economy categories
but not as high as above: high value added
Secondary target
1: Super-premium
§ Upper-upper and lower-upper social
classes
§ Customers from developed
economies (e.g., US and UK)
§ High quality, exotic flavours, e.g. Häagen-Dazs
Mint Chocolate Chip, Ben & Jerry’s Fudge
§ Very high unit prices: very high value added
Secondary target
1: Regular
§ Lower-middle and upper-lower
social classes
§ Customers from developed
economies (e.g., US and UK) and
emerging economies (e.g., South
Africa, China)
§ Standard-quality ingredients with branding
relying on manufacturer’s name rather than
individual product, e.g. Wall’s, Scholler
§ Standard prices: adequate value added but large-
volume market
Possibilities: Ice
cream for cold
weather
§ Upper-upper, lower-upper, and
upper-middle social classes
§ Customers from developed
economies (e.g., US and UK)
§ Good quality ingredients with individual, well-
known branded names
§ Prices set above regular and economy categories
but not as high as above: high value added
Avoid targets:
Economy
§ Lower-lower social class
§ Mainly customers from developing
economies (e.g., South Africa,
China)
§ Relatively customers from
developed economies (e.g., US and
UK)
§ Manufactured by smaller manufacturers with
standard-quality ingredients, possibly for
supermarkets’ own brands
§ Lower price, highly price competitive: low
value added but large market – perhaps high-
quality ingredients
* Based on the information from the “Global ice cream wars”
case study, this column is mainly based on logical
assumptions. For instance, only upper-upper and lower-upper
social classes afford to purchase super-premium
products with high price tags.
6
Internal Environment & SWOT Analysis
Students should also identify and assess the competitors in the
market. This section includes
two analyses: First, identification of the company’s strategic
type based on Porter’s generic
strategy types. Second, SWOT analysis. This section should be
no more than 350 words.
Identification of the company’s current strategic type helps to
better understand its position
in the market (linked to competitor analysis) and its positioning
and targeting strategies (linked
customer analysis). It also helps to assess the company’s value
propositions and strategic
decisions. For instance, companies with “focused differentiation
strategy” are more likely to
heavily invest in R&D and develop premium products. It also
plays a critical role in defining
the company’s problems and proposing relevant alternative
strategies. For instance, proposing
focused low-cost strategies is not appropriate with for leading
brand, such as Porsche and
Apple. It is recommended to suggest minimum two alternative
strategies for companies with
hybrid strategy type (i.e., one differentiation strategy and one
low-cost strategy – please review
papers on organisational ambidexterity). No table or figure is
required for this section.
SWOT analysis is a technique to identify a company’s strengths
and weaknesses and its
opportunities and threats in the market. Students can use
multiple techniques/frameworks
introduced in Chapters 6 (i.e., resource portfolio) to identify a
company’s strengths and
weaknesses. Students also can use the findings in the previous
analyses (i.e., PESTLE,
competitive environment, competitor analysis, customer
analysis) to identify opportunities and
threats in the market. SWOT analysis is designed for use in the
preliminary stages of decision-
making and can be used as a tool for evaluation of a company’s
current strategies, performance,
and position in the market.
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx
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Endianness or Byte OrderBhavana Honnappa, Sravya Karnati, Smit.docx

  • 1. Endianness or Byte Order Bhavana Honnappa, Sravya Karnati, Smita Dutta Abstract Computers speak different languages, like people. Some write data "left-to-right" and others "right-to-left". If a machine can read its own data it tends to encounter no problems but when one computer stores data and a different type tries to read it, that is when a problem occurs. This document aims to present how Endianness is willing to be taken into consideration how Endian specific system inter-operate sharing data without misinterpretation of the value. Endianness describes the location of the most significant byte (MSB) and least significant byte (LSB) of an address in memory and is defined by the CPU architecture implementation of the system. Unfortunately, not all computer systems are designed with constant Endian architecture. The difference in Endian architecture is a difficulty when software or data is shared between computer systems. Little and big endian are two ways of storing multibyte data- type (int, float, etc.). In little endian machines, last byte of binary representation of the multi byte data- type is stored first. On the opposite hand, in big endian machines, first byte of binary representation of the multi byte datatype is stored first. Suppose we write float value to a file on a little-endian machine and transfer this file to a big-endian machine. Unless there is correct transformation, big endian machine will read the file in reverse order. This paper targets on showcasing how CPU-based Endianness raises software issues when reading and writing the data from memory. We will try to reinterpret this information at register/system-level.
  • 2. Keywords: - endianness, big-endian, little-endian, most significant byte (MSB), least significant byte (LSB). Definition of Endianness: - Endianness refers to order of bits or bytes within a binary representation of a number. All computers do not store multi- byte value in the same order. The difference in Endian architecture is an issue when software or data is shared between computer systems. An analysis of the computer system and its interfaces will determine the requirements of the Endian implementation of the software. Based on which value is stored first, Endianness can be either big or small, with the adjectives referring to which value is stored first. Little Endian and Big Endian: - Endianness illustrates how a 32-bit pattern is held in the four bytes of memory. There are 32 bits in four bytes and 32 bits in the pattern, but a choice has to be made about which byte of memory gets what part of the pattern. There are two ways that computers commonly do this. Little endian and Big endian are the two ways of storing multibyte data types. Little Endian and Big Endian are also called host byte order and network byte order respectively. In a multibyte data type, right most byte is called least significant byte (LSB) and left most byte is called most significant byte (MSB). In little endian the least significant byte is stored first, while in big endian, most significant byte is stored. For example, if we have store 0x01234567, then big and little endian will be stored as below: However, within a byte the order of the bits is the same for all computers, no matter how the bytes themselves are arranged. Bi -Endian: -
  • 3. Some architectures such as ARM versions 3 and above, MIPS, PA-RISC, etc. feature a setting which allows for switchable endianness in data fetches and stores, instruction fetches, or both. This feature can improve performance or simplify the logic of networking devices and software. The word bi-endian, when said of hardware, denotes the capability of the machine to compute or pass data in either endian format. Importance of endianness: Endianness is the attribute of a system that indicates whether the data type like integer values are represented from left to right or vice-versa. Endianness must be chosen every time hardware or software is designed. When Endianness affects code: Endianness doesn’t apply to everything. If you do bitwise or bit-shift operations on an int, you don’t notice endianness. However, when data from one computer is used on another you need to be concerned. For example, you have a file of integer data that was written by another computer. To read it correctly, you need to know: · The number of bits used to represent each integer. · The representational scheme used to represent integers (two's complement or other). · Which byte ordering (little or big endian) was used. Processors Endianness: CPU controls the endianness. A CPU is instructed at boot time to order memory as either big or little endian A few CPUs can switch between big-endian and little-endian. However, x86/amd64 architectures don't possess this feature. Computer processors store data in either large (big) or small (little) endian format depending on the CPU processor architecture. The
  • 4. Operating System (OS) does not factor into the endianness of the system, rather the endian model of the CPU architecture dictates how the operating system is implemented. Big endian byte ordering is considered the standard or neutral "Network Byte Order". Big endian byte ordering is in a suitable format for human interpretation and is also the order most often presented by hex calculators. As most embedded communication processors and custom solutions associated with the data plane are Big-Endian (i.e. PowerPC, SPARC, etc.), the legacy code on these processors is often written specifically for network byte order (Big-Endian). Few of the processors with their respective endianness’s are listed below: - Processor Endianness Motorola 68000 Big Endian PowerPC (PPC) Big Endian Sun Sparc Big Endian IBM S/390 Big Endian Intel x86 (32 bit) Little Endian Intel x86_64 (64 bit) Little Endian Dec VAX Little Endian Alpha Bi (Big/Little) Endian ARM Bi (Big/Little) Endian IA-64 (64 bit)
  • 5. Bi (Big/Little) Endian MIPS Bi (Big/Little) Endian Bi-Endian processors can be run in either mode, but only one mode can be chosen for operation, there is no bi-endian byte order. Byte order is either big or little endian. Performance analysis: Endianness refers to data types that are stored differently in memory, which means there are considerations when accessing individual byte locations of a multi-byte data element in memory. Little-endian processors have an advantage in cases where the memory bandwidth is limited, like in some 32-bit ARM processors with 16-bit memory bus, or the 8088 with 8-bit data bus. The processor can just load the low half and complete add/sub/multiplication with it while waiting for the higher half. With big-endian order when we increase a numeric value, we add digits to the left (a higher non-exponential number has more digits). Thus, an addition of two numbers often requires moving all the digits of a big-endian ordered number in storage, to the right. However, in a number stored in little-endian fashion, the least significant bytes can stay where they are, and new digits can be added to the right at a higher address. Thus, resulting in some simpler and faster computer operation. Similarly, when we add or subtract multi-byte numbers, we need to start with the least significant byte. If we are adding two 16- bit numbers, there may be a carry from the least significant byte to the most significant byte, so we must start with the least significant byte to see if there is a carry. Therefore, we start with the rightmost digit when doing longhand addition and not from left. For example, consider an 8-bit system that fetches bytes sequentially from memory. If it fetches the least significant byte first, it can start doing the addition while the most significant byte is being fetched from memory. This
  • 6. parallelism is why performance is better in little endian on such as system. In case, it had to wait until both bytes were fetched from memory, or fetch them in the reverse order, it would take longer. In "Big-Endian" processor, by having the high-order byte come first, we can quickly analyze whether a number is positive or negative just by looking at the byte at offset zero. We don't have to know how long the number is, nor do you have to skip over any bytes to find the byte containing the sign information. The numbers are also stored in the order in which they are printed out, so binary to decimal routines are highly efficient. Handling endianness automatically:- To work automatically, network stacks and communication protocols must also define their endianness, otherwise, two nodes of different endianness won't be able to communicate. Such a concept is termed as “Network Byte Order”. All protocol layers in TCP/IP are defined to be big endian which is typically called network byte order and that they send and receive the most significant byte first. If the computers at each end are little-endian, multi-byte integers passed between them must be converted to network byte order before transmission, across the network and converted back to little-endian at the receiving end. If the stack runs on a little-endian processor, it's to reorder, at run time, the bytes of each multi-byte data field within the various headers of the layers. If the stack runs on a big-endian processor, there’s nothing to stress about. For the stack to be portable, it's to choose to try and do this reordering, typically at compile time. To convert these conversions, sockets provides a collection of macros to host a network byte order, as shown below:
  • 7. · htons() - Host to network short, reorder the bytes of a 16-bit unsigned value from processor order to network order. · htonl() - Host to network long, reorder the bytes of a 32-bit unsigned value from processor order to network order. · ntohs() - Network to host short, reorder the bytes of a 16-bit unsigned value from network order to processor order. · ntohl() - Network to host long, reorder the bytes of a 32-bit unsigned value from network order to processor order. Let’s understand this with a better example: Suppose there are two machines S1 and S2, S1 and S2 are big- endian and little-endian relatively. If S1(BE) wants to send 0x44332211 to S2(LE) · S1 has the quantity 0x44332211, it'll store in memory as following sequence 44 33 22 11. · S1 calls htonl () because the program has been written to be portable. the quantity continues to be represented as 44 33 22 11 and sent over the network. · S2 receives 44 33 22 11 and calls the ntohl(). · S2 gets the worth represented by 11 22 33 44 from ntohl(), which then results to 0x44332211 as wanted. References: - · https://www.geeksforgeeks.org/little-and-big-endian-mystery/ · http://cs-fundamentals.com/tech-interview/c/c-program-to- check-little-and-big-endian-architecture.php · https://developer.ibm.com/articles/au-endianc/ · https://aticleworld.com/little-and-big-endian-importance/ · https://searchnetworking.techtarget.com/definition/big-endian- and-little-endian 2
  • 8. 09/03/2020 1 MAN3106 Marketing Strategy Segmentation, Positioning, and Selecting Target Markets 1 2 09/03/2020 2 Announcements Frequently Asked Questions: 1. Is it possible to search for information beyond the case study? (see also Week 4) 2. Case study is outdated, can I search for the company position and market stats in 2020? 3. What should I do if there is no political issue in the case? 4. Should I analyse historical information (i.e., first 2-3 pages in the Gillette case)? 5. Completing SWOT before or after situation analysis (see also Week 4) 6. Is there an ideal number of alternative strategies that is recommended to include
  • 9. in the assignment to secure a high mark? (see also Week 4) 7. Can I indicate XYZ in a particular analysis? Could you please check my XYZ analysis? (see also Week 4) 8. Reference list 3 Structure of Individual Assignment § Executive summary – around 200 words-not included in the word count § Table of contents – not included in the word count § Situational analysis (20% of the mark) – Macro environment (PESTLE), industry, competitors, & customer environment – around 350 words § Internal environment & SWOT analysis (20% of the mark) – around 350 words § Evaluation of current strategies and problem statement (30% of the mark) – 400 words § Alternative strategies proposition, evaluation, & justification (30% of the mark) – around 400 words § Reference list (if necessary – not included in the word count) 4
  • 10. 09/03/2020 3 Announcements Important tips: 1. Students can use tables/figures to present situation analysis, internal analysis, and SWOT analysis (excluded from word count). For each table/figure, a conclusion should be provided as part of the main text. For instance, students can provide two key conclusions for 5 forces analysis: the level of competitive intensity and the level of attractiveness of the market. 2. Problem statement is different to the above-noted conclusions for each analysis. 3. Problem statement should be based on linking different elements identified in the situation analysis, internal analysis, and SWOT analysis. Thus, problem statement should be based on information provided in the case study. 5 Announcements
  • 11. Important tips: 4. Students can consider novel alternative strategies to address the identified problem(s). However, the proposed strategies should be justified using the information in the case study. For instance, a company can expand to new international markets, if it has strong financial resources and distributions channels based on evidences in the case study. 5. An alternative strategy could be: Status Quo - with improvements 6. The introduced frameworks/principles in the slides and core textbook are generic, which can be used for different case studies (and companies in reality). Case studies are not identical, and each case study may provide different facts. As a critical thinker, you should decide which facts are critical and should be considered for a particular analysis. 6 09/03/2020 4 Main Topics 1. Introduction
  • 12. 2. Segmentation and Positioning Principles (Chapter 7) 3. Segmentation and Positioning Research (Chapter 8) 4. Selecting Market Targets (Chapter 9) 7 Introduction and Relevance Positioning is the act of designing the company’s offering and image so that they occupy a meaningful and distinctive competitive position in the target customer’s minds. (Kotler, 1997) 8 09/03/2020 5 Introduction and Relevance Positioning risks and errors 9 1 Segmentation and Positioning Principles Chapter 7 10
  • 13. 09/03/2020 6 Principles of Market Segmentation Factors that affect the consumer buying process § Decision-making complexity (e.g. high risk, no prior experience, strong involvement) § Individual influences (e.g. age, occupation, personality characteristics, socioeconomic status) § Social influences (e.g. culture, reference groups, peers) § Situational influences (e.g. temporal, spatial, dispositional factors) Need Recognition Information Search Evaluation of Alternatives Purchase Decision Post- Purchase Evaluation
  • 14. 11 Principles of Market Segmentation Market Segmentation … is the process of dividing a market into relatively homogeneous segments or groups. … should create segments where the members within the segments have similar attributes; but where the segments themselves are dissimilar from each other. … typically allows firms to be more successful, because they can tailor products to meet the needs of a particular market segment. Defining the market to be segmented Identifying market segments Forming market segments Finer segmentation strategies
  • 15. Selecting segmentation strategy 12 09/03/2020 7 Segmenting Consumer Markets Segmenting consumer market – Three main methods: § Background customer characterises § Customer attitudes § Customer behaviour 13 Segmenting Consumer Markets Background customer characterises: UK socio-economic classification scheme Source: The Market Research Society. 14 09/03/2020
  • 16. 8 Segmenting Consumer Markets Background customer characterises: The Warner index of status characteristics 15 Segmenting Consumer Markets Background customer characterises: Stages of the family life cycle 16 09/03/2020 9 Segmenting Consumer Markets Three main methods: § Background customer characterises § Customer attitudes: Attitudinal characteristics attempt to draw a causal link between customer characteristics and marketing behaviour § Mainly examine benefits/preferences customers are seeking - e.g. Banking industry: Convenient access, security, interest
  • 17. rate § Customer behaviour: The most direct method – Covers purchase behaviour, consumption behaviour, and communication behaviour § Purchases behaviour: Early adaptor, Brand loyalty, etc. § Consumption behaviour: Usage pattern, Usage volume, etc. § Communication behaviour: Lead users, Promotions, etc. 17 Implementing Market Segmentation § Identify the scope and purpose of segmentation (e.g. new product launch, market penetration with existing products) § Identify the level of segmentation: Strategic, managerial, and operation 18 09/03/2020 10 Implementing Market Segmentation Challenges/problems of implementing market segmentation § Organisation structure § Internal policies § Corporate culture § Information and reporting § Decision-making process
  • 18. § Resource/capabilities § Operation systems 19 2 Segmentation and Positioning Research Chapter 8 20 09/03/2020 11 Segmentation Research Two broad approaches § Priori segmentation § Segmentation is known in advance § Easiest way of segmentation based on demographic or socio-economic stats available in the public domain (e.g., Target Group Index, ACORN) § Post-hoc or cluster-based segmentation § Segmentation is not known in advance § Data will be collected based pre-defined criteria using quantitative and/or qualitative methods 21
  • 19. Segmentation Research Post-hoc or cluster-based segmentation 22 09/03/2020 12 Positioning Research Two broad approaches § Qualitative research methods § Uncover brand, product, company image § Semi-structured techniques to gain in-depth understanding of respondents perceive the world around them § Effective in development of advertising programmes § Quantitative approaches - Investigate positioning relative to: a. Position of major competitors in the market (e.g., market share, coverage, product portfolio, etc) b. Target customers’ desires and needs (e.g., value for money, reliability, quality, safety, convenience, etc) 23
  • 20. Positioning Research Quantitative approaches – Attribute profiling methods 24 09/03/2020 13 Positioning Research Quantitative approaches – Attribute profiling methods & Perceptual map 25 Positioning Research Quantitative approaches – Attribute profiling methods & Perceptual map 26 09/03/2020 14 3 Selecting Market Targets Chapter 9
  • 21. 27 Introduction Targeting … means choosing to focus on one (or more) market segments based on their attractiveness. … determines which customer group(s) the organization will serve (and which not). § Example of different targeting strategies 28 09/03/2020 15 The Process of Selecting Market Targets The process of selecting market targets 1. Define the market 2. Define how the market is segmented 3. Determine market segment attractiveness 4. Determine current and potential strength 5. Making market/segment choices 29 The Process of Selecting Market Targets 1. Define the market Product-customer matrix: The underlying
  • 22. structure of a market can be understood as a simple grouping of customers and products/services § Grouping products/services in banking: Provide access to cash, provide security, but now/pay later, cashless payment, interest on saving, other specialised services § Grouping customer preferences/needs in banking: Convenience, easy to use, efficiency, trust, interest rate, and other preferences 30 09/03/2020 16 The Process of Selecting Market Targets 2. Define how the market is segmented (see Chapters 7 & 8) 3. Determine market segment attractiveness (see Situation analysis) § Market factors § Competitive factors § Economic/technological factors § Business environment factors 31 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible
  • 23. website, in whole or in part. Discuss the impact of evolution of music industry on the music player/speaker market and potential new market segments 32 09/03/2020 17 The Process of Selecting Market Targets 4. Determine current and potential strength Recap: Competitor analysis in Chapter 5 Recap: Resource Portfolios in Chapter 6 33 The Process of Selecting Market Targets 5. Making market/segment choices 34 09/03/2020 18 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  • 24. Propose hypothetical primary targets, secondary targets, and possibilities for: § Secret Escapes § Contiki 35 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Propose hypothetical primary targets, secondary targets, and possibilities for: § Galaxy Z Flip £1300 § Galaxy A90 £399 36 09/03/2020 19 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Propose hypothetical primary targets, secondary targets, and possibilities for: § Boohoo.com 37 Reality in Many Organisations
  • 25. The End. Have Fun! 38 09/03/2020 20 Reading Resources Chapters 7, 8, & 9: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. Chapter 5: Ferrell, O. C. and Hartline M. D. (2014), Marketing Strategy, Cengage, 6th Edition. Dickson, P. R., & Ginter, J. L. (1987). Market segmentation, product differentiation, and marketing strategy. Journal of Marketing, 51(2), 1-10. Green, P. E., & Krieger, A. M. (1991). Segmenting markets with conjoint analysis. Journal of Marketing, 55(4), 20-31. Hooley, G., Broderick, A., & Möller, K. (1998). Competitive positioning and the resource-based view of the firm. Journal of Strategic Marketing, 6(2), 97-116. Moschis, G. P., Lee, E., & Mathur, A. (1997). Targeting the mature market: opportunities and challenges. Journal of Consumer Marketing, 14(4), 282-293.
  • 26. Yankelovich, D., & Meer, D. (2006). Rediscovering market segmentation. Harvard Business Review, 84(2), 122. 39 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Gillette case study situation analysis Week 3 - Competitive market analysis Gillette case study situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation Gillette case study SWOT analysis Week 5 - Segmentation, positioning, and selecting target markets Gillette case study problem identification & alternative strategies provision Week 6 - Creating competitive advantage Individual assignment Q&A Week 7 - Competing through marketing mix Using metaphors in marketing campaigns Week 8 - Competing through superior service and customer
  • 27. relationships Costs of customer loyalty Week 9 - Strategy implementation and control Soft and hard control measures Week 10 - Ethics and social responsibility in marketing strategy - Evolving topics in marketing strategy Group discussion on CSR and crisis management Week 11 - Module Revision Exam preparation Q&A 40 01/03/2020 1 MAN3106 Marketing Strategy Understanding the Organisational Resource Base Competing Through Innovation 1 2 01/03/2020
  • 28. 2 Announcements Frequently Asked Questions: 1. Using perceptual (or positioning) map for competitor analysis 2. PDF vs PPT lecture slides 3. Completing SWOT before or after situation analysis 4. Is there an ideal number of alternative strategies that is recommended to include in the assignment to secure a high mark? 5. Individual assignment structure and assessment criteria 6. Where I can find the individual assignment case study? 7. Can I indicate XYZ in a particular analysis? Could you please check my XYZ analysis? 3 Main Topics 1. Chapter 6: Understanding the Organisational Resource Bass a. Resource-based View b. Marketing resources – Assets c. Marketing resources – Capabilities d. Marketing resources – Dynamic capabilities 2. Chapter 12: Competing Through Innovation a. Why Innovation Matters b. Engaged to a Robot? The Role of AI in Service c. Planning for New Products/Services d. New Product/Service Development Process
  • 29. 4 01/03/2020 3 Chapter 6 Understanding the Organisational Resource Base 5 Unit of Analysis in Market Analysis Unit of Analysis External Environment Macro- Environment Micro- Environment Internal Environment 6 01/03/2020
  • 30. 4 Analysis of the Internal Environment Review of current marketing objectives, strategy, and performance § What are the current marketing goals and objectives? § How are current marketing strategies performing with respect to anticipated outcomes? Review of current and anticipated organisational resources § What is the state of current organisational resources? § Are these resources likely to change for the better or worse in the near future? § If the changes are for the better, how can these added resources be used to better meet customers’ needs? Review of current and anticipated cultural and structural issues § What are the positive and negative aspects of the current and anticipated organisational culture? § What issues related to internal politics or management struggles might affect the marketing activities? 7 Resource-based View § Resource-based view (RBV) is a framework to determine the strategic resources a firm can exploit to achieve sustainable competitive advantage and to explain
  • 31. performance heterogeneity across firms (Barney, 1991). § A key insight arising from RBV is that not all resources are of equal importance § VRIO Framework: § Valuable – enable a firm to implement its strategies. § Rare – not available to other competitors. § Imperfectly (or costly to) imitable – not easily implemented by others. § Organized to Capture Value – resources do not confer any advantage for a firm if they are not organized using organisational structure, processes/capabilities, and culture. 8 01/03/2020 5 Resource-based View § Value-creating disciplines: Only some resources/capabilities need to be superior to competition and enable firms to propose differentiated offering to customers that are hard for competitors to match. § Resource Portfolios
  • 32. 9 Resource-based View Value-creating disciplines § Operational excellence – providing middle-of-market products at the best price with the least inconvenience. e.g., McDonald’s, Burger King and KFC. § Product leadership – offering products that push the boundaries of product and service performance. e.g., Intel is a product leader in computer chips. § Customer intimacy – delivering what specific customers want in cultivated relationships. The core requirements are flexibility, a ‘have it your way’ mindset, mastery of ‘mass customisation’, and the ability to sustain long-term relationships. 10 01/03/2020 6 Marketing Resources: Assets – Capabilities – Dynamic Capabilities 11 Marketing Resources: Assets
  • 33. 12 01/03/2020 7 Marketing Resources: Capabilities § An organisation's ability to manage assets effectively to meet customer needs and gain an advantage over competitors. § A capability is a coordinated bundle of inter-related routines that a firm (or a group of employees) undertakes to perform specific tasks. Input Output 13 Marketing Resources: Capabilities Organizational routines (Nelson and Winter, 1982; Feldman and Pentland, 2003) § Regular & predictable § Collective, social & tacit - Learned over time § Behaviour & performance: The way firms do things § Enable tasks to be executed sub-consciously § Binding knowledge, including tacit knowledge
  • 34. § Can promote or prohibit innovation Importantly routines are learned over time and they are highly firm-specific § Each organization has its own particular ways of doing things, and this can often be a source of competitive advantage. 14 01/03/2020 8 Marketing Resources: Capabilities Marketing CapabilityPricing Promotion / Advertising Market Research Distribution Sales Marketing Planning New P/S Launch Management
  • 35. CRM 15 Marketing Resources: Dynamic Capabilities Dynamic capabilities represent the capacity of an organisation to purposefully create, extend, or modify its resource base (Helfat et al., 2007). § As markets change and become more globally integrated, new forms of competition emerge and firms cannot rest on their existing capabilities alone. Source: Pavlou & El Sawy (2011) 16 01/03/2020 9 Marketing Resources: Dynamic Capabilities Resource Portfolios: Developing and exploiting resources Organizational ambidexterity: The simultaneous exploration and exploitation of resources and product-market opportunities. 17 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible
  • 36. website, in whole or in part. What are benefits and drawbacks of being ambidextrous in the car industry? 18 01/03/2020 10 Reading Resources Chapters 6: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. Barney, J. B. (2001). Resource-based theories of competitive advantage: A ten-year retrospective on the resource-based view. Journal of Management, 27(6), 643- 650. Heirati, N., O’Cass, A., & Sok, P. (2017). Identifying the resource conditions that maximize the relationship between ambidexterity and new product performance. Journal of Business & Industrial Marketing, 32(8), 1038-1050. Morgan, N. A., Vorhies, D. W., & Mason, C. H. (2009). Market orientation, marketing capabilities, and firm performance. Strategic Management Journal, 30(8), 909-920.
  • 37. O'Cass, A., Heirati, N., & Ngo, L. V. (2014). Achieving new product success via the synchronization of exploration and exploitation across multiple levels and functional areas. Industrial Marketing Management, 43(5), 862-872. Pavlou, P., & El Sawy, O. (2011). Understanding the elusive black box of dynamic capabilities. Decision sciences, 42(1), 239-273. Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509-533. 19 Chapter 12 Competing Through Innovation 20 01/03/2020 11 Why Innovation Matters § Everybody wants to be the next Google, IBM, or Netflix § Nobody wants to be Kodak, Blockbuster, or BlackBerry. § “Companies achieve competitive advantage through acts of innovation. They approach innovation in its broadest sense, including both new
  • 38. technologies & new ways of doings things” - Michael Porter 21 Why Innovation Matters § Achieving success through innovation is not easy and the failure rate is high § What is missing is a clear set of principles for action! § This can only be achieved by treating innovation as a process. 22 01/03/2020 12 Source: Adapted from Piercy (2017) Why Innovation Matters Innovation as the Driver of Renewal and Reinvention 23 Key Success/Failure Factors 24 01/03/2020
  • 39. 13 Planning for New Products/Services New product development stages and time lapse 25 Planning for New Products/Services Innovation types based on the level of Newness 26 01/03/2020 14 Planning for New Products/Services Innovation types based on the level of Newness 27 Planning for New Products/Services Scope of Innovation: 4Ps of Innovation Space § Product – Changes in the things (products/services) § Process – Changes in the ways in which they are created and delivered § Position – Changes in the context in which the products/services are introduced § Paradigm – Changes in the underlying mental & business
  • 40. models 1’ 40’’: IBM's Process Innovation for Healthcare 28 https://www.youtube.com/watch%3Fv=IFerjdndiRU 01/03/2020 15 Planning for New Products/Services 29 Planning for New Products/Services Innovation Lifecycle Management INTRODUCTION GROWTH MATURITY DECLINE EXTENSION SA LE S 30 01/03/2020
  • 41. 16 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Make an Extension Plan for: Typing machine INTRODUCTION GROWTH MATURITY DECLINE EXTENSION SA LE S 31 New Product/Service Development Process 32 01/03/2020 17 New Product/Service Development Process 33 New Product/Service Development Process
  • 42. Collaborative Innovation 34 01/03/2020 18 New Product/Service Development Process Collaborative Innovation Blut, M., Heirati, N., & Schoefer, K. (2019). The Dark Side of Customer Participation: When Customer Participation in Service Co-Development Leads to Role Stress. Journal of Service Research, 1094670519894643. Heirati, N., & Siahtiri, V. (2019). Driving service innovativeness via collaboration with customers and suppliers: Evidence from business-to-business services. Industrial Marketing Management, 78, 6-16. Heirati, N., O'Cass, A., Schoefer, K., & Siahtiri, V. (2016). Do professional service firms benefit from customer and supplier collaborations in competitive, turbulent environments?. Industrial Marketing Management, 55, 50-58. 35 Reality in Many Organisations The End. Have Fun!
  • 43. 36 01/03/2020 19 Reading Resources Chapters 12: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. Anthony, S. D., Eyring, M., & Gibson, L. (2006). Mapping your innovation strategy. Harvard Business Review, 84(5), 104-13. Blut, M., Heirati, N., & Schoefer, K. (2019). The Dark Side of Customer Participation: When Customer Participation in Service Co-Development Leads to Role Stress. Journal of Service Research, 1094670519894643. Calantone, R. J., Schmidt, J. B., & Song, X. M. (1996). Controllable factors of new product success: A cross- national comparison. Marketing Science, 15(4), 341-358. Heirati, N., & Siahtiri, V. (2019). Driving service innovativeness via collaboration with customers and suppliers: Evidence from business-to-business services. Industrial Marketing Management, 78, 6-16. Heirati, N., O'Cass, A., Schoefer, K., & Siahtiri, V. (2016). Do professional service firms benefit from customer and supplier collaborations in competitive, turbulent
  • 44. environments?. Industrial Marketing Management, 55, 50-58. Pisano, G. P. (2015). You need an innovation strategy. Harvard Business Review, 93(6), 44-54. Szymanski, D. M., Kroff, M. W., & Troy, L. C. (2007). Innovativeness and new product success: Insights from the cumulative evidence. Journal of the Academy of Marketing Science, 35(1), 35-52. 37 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Gillette case study situation analysis Week 3 - Competitive market analysis Gillette case study situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation Gillette case study SWOT analysis Week 5 - Segmentation, positioning, and selecting target markets Gillette case study problem identification & alternative strategies provision Week 6 - Creating competitive advantage Individual assignment
  • 45. Q&A Week 7 - Competing through marketing mix Using metaphors in marketing campaigns Week 8 - Competing through superior service and customer relationships Costs of customer loyalty Week 9 - Strategy implementation and control Soft and hard control measures Week 10 - Ethics and social responsibility in marketing strategy - Evolving topics in marketing strategy Group discussion on CSR and crisis management Week 11 - Module Revision Exam preparation Q&A 38 24/02/2020 1 MAN3106 Marketing Strategy Competitive Market Analysis 1
  • 46. 2 24/02/2020 2 Announcements Frequently Asked Questions: 1. How will we meet the independent study assessment criteria which states that there must be evidence of “extensive independent reading using a wide range of carefully selected sources”. How will we meet the knowledge assessment criteria which states there must be evidence of “thorough integration and application of a full range of appropriate principles, theories, evidence and techniques.” However how can we do all these things without referencing theories/principles. 2. For the situational analysis, how can we thoroughly and to a high level analyse without conducting our own research. 3. If we want to use theories and concepts do we reference these even though we will not receive marks for them. Also, should these be referenced using in-text citations along with our reference list, and will these in-text citations be part of the word count?
  • 47. 3 Relevance Market analysis… § is one of the most important tasks because all decision making and planning depends on how well the analysis is conducted § should be an ongoing, systematic effort that is well organised and supported by sufficient resources § should provide as complete a picture as possible about the organisation’s current and future situation with respect to the internal and external environment 4 24/02/2020 3 Main Topics 1. Introduction 2. Analysis of the External Macro-Environment 3. Analysis of the External Micro-Environment: Customer Analysis
  • 48. 4. Analysis of the External Micro-Environment: Competitor Analysis 5 1 Introduction to Competitive Market Analysis 6 24/02/2020 4 Unit of Analysis in Market Analysis Unit of Analysis External Environment Macro- Environment Micro- Environment Internal Environment 7 Conducting a Situation Analysis
  • 49. Analysis alone is not a solution Data is not the same as information § Data – a collection of numbers or facts that have the potential to provide information § Information – data that have been transformed or combined with other data in a manner that makes them useful to decision makers Conducting a situation analysis is a challenging exercise § Should provide a complete picture of three key environments: Internal, Customer, and External 8 24/02/2020 5 Collecting Marketing Information Types of Data § Secondary data – data can be collected from a wide array of internal, government, periodical, book, and commercial sources (secondary research)
  • 50. § Primary data – data can be collected through studies in the form of direct observation, focus groups, surveys, or experiments (primary research) Typical Problems in Data Collection § Incomplete or inaccurate assessment of the situation that the data should address § Severe information overload § Time and expense of collecting data § Data integration 9 Primary Data: Marketing Research Methods 10 24/02/2020 6 Primary Data: Marketing Research Methods Qualitative methods: Observation, interview, focus group, etc. 11 Primary Data: Marketing Research Methods Quantitative methods: Experiment, survey, etc. 12
  • 51. 24/02/2020 7 Analysis of the internal environment [to be covered next lectures] Review of current marketing objectives, strategy, and performance § What are the current marketing goals and objectives? § How are current marketing strategies performing with respect to anticipated outcomes? Review of current and anticipated organisational resources § What is the state of current organisational resources? § Are these resources likely to change for the better or worse in the near future? § If the changes are for the better, how can these added resources be used to better meet customers’ needs? Review of current and anticipated cultural and structural issues § What are the positive and negative aspects of the current and anticipated organisational culture? § What issues related to internal politics or management struggles might affect the marketing activities? 13
  • 52. Analysis of the External Macro-Environment 2 14 24/02/2020 8 PESTEL Analysis 15 Economic Growth and Stability Economic change is inevitable and has a profound impact on marketing strategy. General Economic Conditions § Inflation, employment, income, interest rates, taxes, trade restrictions, tariffs, business cycle Consumer Issues § Willingness to spend, confidence, spending patterns An Underreported Economy § The U.S. economy is dominated by intangibles such as services and information. § Innovation, creativity, and human assets are not counted in yearly GDP statistics. 16
  • 53. 24/02/2020 9 Economic Growth and Stability 17 Political, Legal, and Regulatory Issues The views of elected officials can affect marketing strategy. § Example hot-button issues: tobacco, immigration, taxes, retirement, healthcare § Lobbying is vital to marketing strategy in highly regulated industries. Firms must abide by the law, but many laws are vague and difficult to enforce. § e.g. court decisions, corporate governance, trade agreements 18 24/02/2020 10 Technological Advancements Technology refers to the processes used to create “things” considered to be new. Frontstage Technology § Advances that are noticeable to customers…what customers
  • 54. think of when they think of technological advancements § e.g. smartphones, GPS, microwave ovens Backstage Technology § Advances that are not noticeable to customers…these advances make marketing activities more efficient and effective § e.g. computer technology, RFID, near-field communication Gartner’s Top 10 Strategic Technology Trends for 2020 19 Technological Advancements Product lifecycle Industry evolution (lifecycle) 20 24/02/2020 11 Sociocultural Trends Social and cultural influences that cause changes in attitudes, beliefs, norms, customs, and lifestyles Sociocultural forces can have a profound effect on the way
  • 55. customers live and buy products. Changes in customer demographics and values have a considerable impact on marketing. Example Trends in the U.S. Sociocultural Environment § Demographic Trends - Aging of the American population - Population growth in Sun Belt states - Increasing population diversity § Lifestyle Trends - Many Americans are postponing retirement - Clothing becoming more casual, especially at work - Time spent watching television and reading newspapers has declined § Value Trends - Greater focus on ethics and social responsibility - Shorter attention spans and less tolerance for waiting - Growing skepticism about business 21 Sociocultural Trends Growth in the Number of Older Americans 22 24/02/2020 12 Measuring PESTLE Impact
  • 56. 23 Measuring PESTLE Impact 24 24/02/2020 13 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. What about geographical factors analysis? Gillette Tag Weather – 2’ 21’’: www.youtube.com/watch?v=8HoA6IhBhyw 25 25 Analysis of the External Micro-Environment: Customer Analysis 3 26 http://www.youtube.com/watch%3Fv=8HoA6IhBhyw 24/02/2020
  • 57. 14 Analysis of the External Micro-Environment Customer analysis §Discussed in Seminar Week 2 §More discussions in Week 5 §Consumer, purchaser, and decider are not always the same person §e.g. Nappies! 27 Three Tiers of Noncustomers 28 24/02/2020 15 Analysis of the External Micro-Environment: Competitor Analysis 4 29 Analysis of the External Micro-Environment Competitor analysis
  • 58. § Industrial organisation (IO) economics perspective § Porter’s Five Forces Model: Five forces determine the competitive intensity (and attractiveness) of an industry in terms of profitability 30 24/02/2020 16 Porter’s 5 Forces Analysis Five Forces Analysis assumes that there are five important forces that determine competitive power in a business situation. § Supplier Power - Here you assess how easy it is for suppliers to drive up prices - The fewer the supplier choices you have, and the more you need suppliers' help, the more powerful your suppliers are § Buyer Power - Here you ask yourself how easy it is for buyers to drive prices
  • 59. down – How much is the customer’s switching cost - If you deal with few, powerful buyers, then they are often able to dictate terms to you 31 Porter’s 5 Forces Analysis § Threat of Substitution - This is affected by the ability of your customers to find a different way of doing what you do – for example, if you supply a unique software product that automates an important process, people may substitute by doing the process manually or by outsourcing it § Threat of New Entry - If it costs little in time or money to enter your market and compete effectively - If there are few economies of scale in place, or if you have little protection for your key technologies, then new competitors can quickly enter your market and weaken your position § Competitive Rivalry - What is important here is the number and capability of your competitors - If you have many competitors that offer equally attractive products/services, then you'll
  • 60. most likely have little power, because buyers will go elsewhere if they don't get a good deal from you 32 24/02/2020 17 Porter’s 5 Forces Analysis 33 Porter’s 5 Forces Analysis 34 24/02/2020 18 The components of competitor analysis 35 The components of competitor analysis Competitor Objectives § Brand Competitors – Market products with similar features and benefits to the same
  • 61. customers at similar prices § Product Competitors – Compete in the same product class, but with products that are different in features, benefits, and price § Generic Competitors – Market different products that satisfy the same basic customer need § Budget Competitors – Compete for the limited financial resources of the same customers 36 24/02/2020 19 Major Types of Competition 37 The components of competitor analysis Competitor Strategies 38 24/02/2020 20 The components of competitor analysis
  • 62. Competitor Resources/Capabilities 39 Learning from Competitors 40 24/02/2020 21 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Of the three major environments in a situation analysis (internal, customer, external), which do you think is the most important in a general sense? Why? What are some situations that would make one environment more important than the others? 41 Reality in Many Organisations The End. Have Fun! 42
  • 63. 24/02/2020 22 Reading Resources Chapters 2, 3, & 4: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. Chapter 3: Ferrell, O. C. and Hartline M. D. (2014), Marketing Strategy, Cengage, 6th Edition. Chen, M. J. (1996). Competitor analysis and interfirm rivalry: Toward a theoretical integration. Academy of Management Review, 21(1), 100-134. Grundy, T. (2006). Rethinking and reinventing Michael Porter's five forces model. Strategic Change, 15(5), 213-229. Kim, W. C., & Mauborgne, R. (2014). Blue ocean strategy, expanded edition: How to create uncontested market space and make the competition irrelevant. Harvard Business Review Press. Menon, A., Bharadwaj, S. G., Adidam, P. T., & Edison, S. W. (1999). Antecedents and consequences of marketing strategy making: a model and a test. Journal of Marketing, 63(2), 18-40. Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard Business Review,
  • 64. 86(1), 25-40. 43 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Gillette case study situation analysis Week 3 - Competitive market analysis Gillette case study situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation Gillette case study SWOT analysis Week 5 - Segmentation, positioning, and selecting target markets Gillette case study problem identification & alternative strategies provision Week 6 - Creating competitive advantage Individual assignment Q&A Week 7 - Competing through marketing mix Using metaphors in marketing campaigns Week 8 - Competing through superior service and customer relationships Costs of customer loyalty
  • 65. Week 9 - Strategy implementation and control Soft and hard control measures Week 10 - Ethics and social responsibility in marketing strategy - Evolving topics in marketing strategy Group discussion on CSR and crisis management Week 11 - Module Revision Exam preparation Q&A 44 10/02/2020 1 MAN3106 Marketing Strategy Module Objectives & Structure Introduction to Marketing Strategy 1 Hello! Nima Heirati Associate Professor in Marketing Research: Innovation Strategy, Service Marketing, Business Relationships, and Customer Experience e.g., Organizational ambidexterity, Innovation
  • 66. strategy in emerging economies, Dark side of business relationships, Servitization Anastasios Siampos Senior Teaching Fellow in Marketing Research areas: Marketing strategy, Entrepreneurship 2 10/02/2020 2 Aims/Objectives By the end of this session, you will be able to: § Identify the module learning objective § Why does this module matter? § Reading resources § Comprehend the teaching style, students’ responsibilities, and assessment criteria 3 What is this module about? Founded in 2008 191+ countries 100k+ cities
  • 67. 500m guest arrivals approx. $30 billion value 4 10/02/2020 3 What is this module about? Founded in 1706 115 countries 198 blends of teas approx. 7 billion cups/year 5 What is this module about? Marketing strategy … is a market-driven process of strategy development and considers a constantly changing business environment and the need to deliver superior customer value. It is focused on increasing organisational performance, links the organisation with the environment, and conceives marketing as a responsibility of the entire business
  • 68. rather than a specialised function (Cravens & Piercy 2013). … has the fundamental goal of increasing sales and achieving a sustainable competitive advantage (Ferrell & Hartline 2014). 6 10/02/2020 4 Why does it matter? § It is interesting Strategic marketing builds on insights from various disciplines including psychology, sociology, economics, etc. § It is challenging Strategic marketing requires consideration of a wide range of factors. These factors interact and they are subject to change. § It is important Strategic marketing is concerned with how organisations create, communicate, deliver, and capture value and, as such, has important performance implications. 7 Knowledge & Learning Outcomes By the end of this module, students should: § Synthesise knowledge of marketing strategy and apply
  • 69. concepts to case studies. § Accurately identify and apply relevant theory within different contexts § Critically evaluate various marketing approaches and application of strategy within a specific context § Identify and analyse marketing problems through the use of case studies § Understand the use of a Strategic Marketing Plan § Organise and communicate ideas clearly 8 10/02/2020 5 Teaching Pattern 11 weeks of two-hour lectures § The basic concepts and theories of the textbook will be introduced, in addition to the materials that go beyond the textbook and are relevant for the exam. 11 weeks of one-hour seminars § Students will be assigned to a seminar group via timetable automatically. § Seminars intend to ensure a comprehensive understanding of the topic area and
  • 70. to make sure that students are be able to detect and transfer learned concepts to practice. Students are in control of their learning in this module § To take most advantages of each class, you must be prepared § Students are expected to participate actively and positively in the teaching/learning environment 9 Learning Resources Essential Reading § Hooley, G., Piercy, N., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. § Hooley, G., Nicoulaud, B., Rudd, J., and Lee, N. (2020), Marketing Strategy & Competitive Positioning, Prentice Hall, 7th Edition. Complementary learning resources § Ferrell, O., and Hartline M. D. (2014), Marketing Strategy, Cengage, 6th Edition. § Lynch, R. (2018) Strategic Management, Pearson, 8th Edition. § McDonald, M., and Wilson, H. (2016). Marketing Plans: How to prepare them, how to profit from them. John Wiley & Sons, 8th Edition. § Apart from textbooks, students will find it valuable to get into the practice of
  • 71. reading relevant articles from academic journals, magazines, and websites. Surrey Learn § The lecture notes, PowerPoint slides, details of assessments and other information, together with important announcements, will be available on Surrey Learn. 10 10/02/2020 6 Assessment Coursework 50%. Each student should analyse a case study following the framework and guidelines provided through lectures and seminars (MAXIMUM 1500 words). § This case study analysis report will allow students to go beyond what was learned in class and learn how to develop marketing strategies for a real- world case study. Exam 50%. Closed book exam (duration 120 minutes) based on a case study provided in advance of the examination. Students will be given a case study in Week 10 via SurreyLearn. At the end of the case study, FOUR essay questions will be provided. § You cannot bring your own case study in the exam. During the
  • 72. exam, you will be given a new but identical copy of the case study along with FOUR questions. Out of the FOUR questions, you will have to answer TWO questions (50% each). You must answer the questions based on the information on the case study (i.e., not further search or market stats is required). Type Weighting Details Due Date Coursework 50% 1500 words individual assignment 23rd March 2020 Exam 50% 2-hour closed book exam Examination period 11 Plan for Seminars Week 1-7 Seminars intend to ensure a comprehensive understanding of the topic area and to make sure that students are able to apply learned concepts to practice. Preparation and active participation in seminars will be expected. § Student will have the opportunity to practice analysing an example case study during Weeks 1 to 7. § Please print and review “CASE STUDY 10.3: Global ice cream wars” from Lynch, R. (2018) Strategic Management, Pearson, 8th Edition – pp. 351-355. § Students have online access to this textbook via the university
  • 73. library website § Students will be given a different case study for the individual assignment in Week 3 via SurreyLearn. § Students will be given a different case study for the exam in Week 9 via SurreyLearn. 12 10/02/2020 7 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Example case study – Situation analysis Week 3 - Competitive market analysis Example case study – Situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation Example case study – SWOT analysis & problem identification
  • 74. Week 5 - Segmentation, positioning, and selecting target markets Example case study – Alternative strategies Week 6 - Creating competitive advantage Individual assignment Q&A Week 7 - Competing through marketing mix Example case study – Implementation & control Week 8 - Competing through superior service and customer relationships Costs of customer loyalty Week 9 - Strategy implementation and control Soft and hard control measures Week 10 - Ethics and social responsibility in marketing strategy- Evolving topics in marketing strategy Group discussion on CSR and crisis management Week 11 - Module Revision Exam preparation Q&A 13 Introduction to Marketing Strategy 14 10/02/2020 8 Main Topics
  • 75. 1. Basic concepts and framework § Markets and exchange § The strategic triangle and competitive advantage 2. Marketing in today’s economy 3. Component and context of market orientation 4. The role of marketing in the organisation 15 Market, exchange, and product What is a market? § Collection of buyers (e.g. consumers, private households) and sellers (e.g. firms, institutions) § A space where supply meets demand Considers physical marketplaces (e.g. traditional farmer’s market) Considers virtual marketspaces (e.g. online retail platforms) 16 10/02/2020 9 Market, exchange, and product What is exchange? § The process of obtaining something of value from someone by offering something
  • 76. in return – Five conditions: § There must be at least two actors to the exchange § Each actor has something of value to the other actor § Each actor must be capable of communication and delivery § Each actor must be free to accept or reject the exchange § Each actor believes that it is desirable to exchange with the other actor 17 The strategic triangle and competitive advantage 18 10/02/2020 10 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Increasing customer power is a continuing challenge to marketers in today’s economy. In what ways have you personally experienced this shift in power; either as a customer or as a business person? Is this power shift uniform across industries and markets? How so?
  • 77. 19 Marketing in Today’s Economy All organisations require effective planning and a sound marketing strategy to achieve their goals and objectives Today’s Economy: § Most of industries are becoming mature, where slowing innovation, extensive product assortment, excess supply, and frugal consumers force margins to the floor § Today’s economy is characterised by rapid technological change, economic anxiety, and increasing consumer scepticism Is there any key technological difference? 20 10/02/2020 11 Major Challenges vs Opportunities Power shift to customers – e.g. Amazon empowers searching for the best deal Massive increase in product selection – e.g. Car Industry
  • 78. Audience and media fragmentation – e.g. Customer can find next offer in one click – Social media influences consumer behaviour Changing value propositions & demand pattern – e.g. digital vs printed books Privacy, security, and ethical concerns Globalisation Change in Daily Media Usage by U.S. Adults, 2008-2011 21 Components and context of market orientation § Market Orientation is a philosophy of decision making focused on customer needs § Market Orientation represents the set of organisational-wide behaviour that enables a firm to generate and disseminate market intelligence among its employees and to utilise market intelligence to respond to customer needs § Decisions grounded in analysis of the target customers § Result: § Developing new products/service that customers are looking for § Increased creativity § Improved new product performance 22
  • 79. 10/02/2020 12 Components and context of market orientation Customers do not want a 1/4“ drill, they want to hang a picture on the wall! § Value Matters: Innovation Has Direction 5’ 12’’: Value Matters: Innovation Has Direction Customer/Value DrivenProduct Driven 23 Components and context of market orientation Marketing and performance outcomes 24 https://www.youtube.com/watch%3Fv=-se_wEJ_KM4 10/02/2020 13 Different Market Orientation Approaches Responsive vs. Proactive Market Orientation
  • 80. Customers Focus Proactive MO Responsive MO Expressed customer needs Current competitive threats Latent and future customer needs Anticipated competitive threats Competitors Focus 25 Assessing a Firm’s Market Orientation ¨ Responsive Market Intelligence Generation (Rank 1 to 7) § This firm continuously works to better understand of our customers’ needs. § This firm pays close attention to after-sales service. § This firm measures customer satisfaction systematically and frequently. § This firm wants customers to think of us as allies. § Employees throughout the organisation share information concerning competitors’ activities.
  • 81. § Top management regularly discusses competitor’s strengths and weaknesses. § This firm tracks the performance of key competitors. § This firm evaluates the strengths and weaknesses of key competitors. ¨ Proactive Market Intelligence Generation (Rank 1 to 7) § This firm continuously tries to discover additional needs of our customers of which they are unaware. § This firm incorporates solutions to unarticulated customer needs in its new products and services. § This firm brainstorms about how customers’ needs will evolve. § This firm works with lead users, customers who face needs that eventually will be in the market. § This firm tries to anticipate the future moves of our competitors. § This firm monitors firms competing in related product/markets. § This firm monitors firms using related technologies. § This firm monitors firms already targeting our prime market segment but with unrelated products. 26 10/02/2020 14 The role of marketing in the organisation 27 © 2014 Cengage Learning. All Rights Reserved. May not be
  • 82. scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. It is argued that marketing possesses very few rules for choosing the appropriate marketing activities. Can you describe any universal rules of marketing that might be applied to most products, markets, customers, and situations? 28 10/02/2020 15 The Challenges of Marketing Strategy § Unending Change § People-Driven Nature of Marketing § Lack of Rules for Choosing Marketing Activities § Increasing Customer Expectations § Declining Customer Satisfaction and Brand Loyalty § Competing in Mature Markets § Increasing commoditisation § Little real differentiation among product offerings § Aggressive Cost-Cutting Measures 29
  • 83. Reality in Many Organisations The End. Have Fun! 30 10/02/2020 16 Reading Resources Chapter 1: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. Chapter 1: Ferrell, O. C. and Hartline M. D. (2014), Marketing Strategy, Cengage, 6th Edition. Kotler, P. (2011). Reinventing marketing to manage the environmental imperative. Journal of Marketing, 75(4), 132-135. Morgan, N. A. (2012). Marketing and business performance. Journal of the Academy of Marketing Science, 40(1), 102-119. Varadarajan, R. (2010). Strategic marketing and marketing strategy: Domain, definition, fundamental issues and foundational premises. Journal of the Academy of Marketing Science, 38(2), 119-140.
  • 84. 31 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Example case study – Situation analysis Week 3 - Competitive market analysis Example case study – Situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation Example case study – SWOT analysis & problem identification Week 5 - Segmentation, positioning, and selecting target markets Example case study – Alternative strategies Week 6 - Creating competitive advantage Individual assignment Q&A Week 7 - Competing through marketing mix Example case study – Implementation & control Week 8 - Competing through superior service and customer relationships Costs of customer loyalty Week 9 - Strategy implementation and control Soft and hard control measures
  • 85. Week 10 - Ethics and social responsibility in marketing strategy- Evolving topics in marketing strategy Group discussion on CSR and crisis management Week 11 - Module Revision Exam preparation Q&A 32 Individual Assignment Brief MAN3106 Marketing Strategy – Semester 2 2019-20 Submission Due: 23/03/2020 – Word limit: 1500 words Students should critically analyse the case study “Gillette: Why Innovation Might not be Enough” following the framework introduced in the lectures/seminars to identify 1- 2 key challenges/problems in the case and to recommend and justify alternative marketing strategies. You must analyse the case study based on the information on the case. This means that even if you do your own research (e.g. you find some additional data about market trends), and you use such information, you will not receive a mark for that. The school’s assessment criteria are provided in Appendix I at the end of Module Handbook. All five assessment criteria in the Module Handbook
  • 86. are relevant to this individual assignment. Structure of the Individual Assignment § Executive summary – around 200 words-not included in the word count § Table of contents – not included in the word count § Situational analysis (20% of the mark) – Macro environment, industry, competitors, & customer environment – around 350 words § Internal environment & SWOT analysis (20% of the mark) – around 350 words § Evaluation of current strategies and problem statement (30% of the mark) – 400 words § Alternative strategies proposition, evaluation, & justification (30% of the mark) – around 400 words § Reference list (if necessary – not included in the word count) NOTE. Word limit excludes executive summary, table of contents, references, tables, figures, and appendices. All coursework should be submitted electronically in Word format only. Penalties: Any work submitted over the word limit will be marked in full, but the assignment will be penalised by 10 marks.
  • 87. 15/02/2020 1 MAN3106 Marketing Strategy Case Study Analysis Framework 1 Assessment Coursework 50%. Each student should analyse a case study following the framework and guidelines provided through lectures and seminars (MAXIMUM 1500 words). § This case study analysis report will allow students to go beyond what was learned in
  • 88. class and learn how to develop marketing strategies for a real- world case study. Exam 50%. Closed book exam (duration 120 minutes) based on a case study provided in advance of the examination. Students will be given a case study in Week 9 via SurreyLearn. § You cannot bring your own case study in the exam. During the exam, you will be given a new but identical copy of the case study along with FOUR questions. Out of the FOUR questions, you will have to answer TWO questions (50% each). You must answer the questions based on the information on the case study (i.e., not further search or market stats is required). Type Weighting Details Due Date Coursework 50% 1500 words individual assignment 23rd March 2020 Exam 50% 2-hour closed book exam Examination period 2 15/02/2020 2 Plan for Seminars Week 1-7 Seminars intend to ensure a comprehensive understanding of the
  • 89. topic area and to make sure that students are able to apply learned concepts to practice. Preparation and active participation in seminars will be expected. § Student will have the opportunity to practice analysing an example case study during Weeks 1 to 7. § Please print and review “CASE STUDY 10.3: Global ice cream wars” from Lynch, R. (2018) Strategic Management, Pearson, 8th Edition – pp. 351-355. § Students have online access to this textbook via the university library website § Students will be given a different case study for the individual assignment in Week 3 via SurreyLearn. § Students will be given a different case study for the exam in Week 9 via SurreyLearn. 3 Structure of Individual Assignment § Executive summary – around 200 words-not included in the word count § Table of contents – not included in the word count § Situational analysis (20% of the mark) – Macro environment, industry, competitors, & customer environment – around 350 words
  • 90. § Internal environment & SWOT analysis (20% of the mark) – around 350 words § Evaluation of current strategies and problem statement (30% of the mark) – 400 words § Alternative strategies proposition, evaluation, & justification (30% of the mark) – around 400 words § Reference list (if necessary – not included in the word count) 4 15/02/2020 3 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Example case study – Situation analysis Week 3 - Competitive market analysis Example case study – Situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation
  • 91. Example case study – SWOT analysis & problem identification Week 5 - Segmentation, positioning, and selecting target markets Example case study – Alternative strategies Week 6 - Creating competitive advantage Individual assignment Q&A Week 7 - Competing through marketing mix Example case study – Implementation & control Week 8 - Competing through superior service and customer relationships Costs of customer loyalty Week 9 - Strategy implementation and control Soft and hard control measures Week 10 - Ethics and social responsibility in marketing strategy - Evolving topics in marketing strategy Group discussion on CSR and crisis management Week 11 - Module Revision Exam preparation Q&A 5 What is the Case Study Case studies (or case reports) are written by academics and professional
  • 92. focusing on actual problems and decisions companies face. § Most articles about companies in magazines and newspapers such as The Wall Street Journal, Business Week, Fortune, Harvard Business Review, and Forbes are mini-cases. § This is not a substitute for real world experience in a job with an organisation, but it is an effective and practical type of learning. 6 15/02/2020 4 The Analysis Framework § Case studies offer stories, including facts, opinions, projections, results, expectations, plans, policies, and programs. § A systematic approach (or framework) is required to structure and analyse presented information within a case study. § Benefits of having a framework to analyse: § Comprehensive coverage § Ease of communication § Consistency of analysis 7
  • 93. Tips Before Analysis! § No one can analyse a case study after reading it only one time, or even worse, doing the analysis during the first reading of the case. § Do not get trapped into thinking the “answer” to the case study is hidden somewhere in the case text. § Make an effort to put yourself in the shoes of the decision maker in the case study. 8 15/02/2020 5 5 Step Case Analysis Framework Step 1: Situation Analysis (Macro environment - Industry, Competitors, & Customer environment) Step 2: Internal Environment Analysis Step 3: Problem(s) Statements and Setting Objectives Step 4: Alternative Strategies Proposition, Evaluation, & Justification
  • 94. Step 5: Implementation Plan/Actions and Control Mechanisms 9 Step 1: Situation Analysis Organising the pieces of information into more useful topic blocks: § PESTLE analysis § Industry and competitors analysis (Porter’s 5 forces – Competitors’ weaknesses & strength) § Customer analysis (Market potential – Market segmentation demographics and preferences – Main target customers) 10 15/02/2020 6 Step 1: Situation Analysis – Measuring PEST Impact 11 Step 1: Situation Analysis – Industry & Competitors Industry and competitors analysis § Porter’s 5 forces § Competitors’ weaknesses & strengths 12
  • 95. 15/02/2020 7 Porter’s 5 Forces Analysis – Industry & Competitors 13 Step 1: Situation Analysis – Customers Customer analysis § Market potential § Market segmentation demographics and preferences § Main target customers - Who are our Current and Potential Customers? - What do Customers do with our Products/Services? - Where/When do Customers Purchase our Products/ Services? - Why (and How) do Customers Select our Products/ Services? - Why do Potential Customers not Purchase our Products/ Services? 14 15/02/2020 8 Step 1: Situation Analysis – Customers Three Tiers of Noncustomers
  • 96. 15 Step 2: Internal Analysis Identify the Company’s Generic Competitive Strategy Type Overall Low-Cost Leadership Strategy Broad Differentiation Strategy Focused Differentiation Strategy Focused Low-Cost Strategy Hybrid Strategy A Broad Cross- section of Buyers Market Niche M ar ke t T ar ge
  • 97. t Type of Competitive Advantage Being Pursued Lower Cost Differentiation 16 15/02/2020 9 Step 2: Internal Analysis SWOT Analysis 17 Step 2: Internal Analysis A four-cell array used to make a conclusion of SWOT analysis § Should be based on customer perceptions, not the perceptions of the manager or firm § Elements with the highest total ratings should have the greatest influence in developing the strategy. § Focus on competitive advantages by matching strengths with opportunities 18
  • 98. 15/02/2020 10 Step 3: Problem(s) Statements and Setting Objectives Only a problem properly defined can be addressed The proper definition of the problem(s) facing the company is the most critical part of the analysis § Define the problem too narrowly, or miss the key problem, and all subsequent framework steps will be off the mark § Getting a clear picture of the problem is one major benefit derived from PEST, industry environment, customer environment, and SWOT analyses 19 Step 3: Problem(s) Statements and Setting Objectives Problem Identification Process § The process of identifying problems is similar to the one people go through with their doctors - A nurse or assistant comes in to conduct a strength and weakness assessment on a patient
  • 99. - The patient’s vital signs are taken and the patient is asked about any symptoms § Symptoms are observable indications - Symptoms are not the problem themselves 20 15/02/2020 11 Input Question The problem is that sales have declined. → Why have sales declined? Sales have declined because there are too many sales territories that are not assigned to a salesperson. → Why are so many sales territories unassigned? Sales territories are unassigned because sales force turnover has doubled in the past year. → Why has sales force turnover doubled? Turnover began to increase over a year ago when the sales force compensation plan was altered to reduce variable expenses. → Why…. * When a student can no longer devise a meaningful response to the Why question, the problem is probably revealed. In this instance, the problem statement might
  • 100. read: Conclusion: The current sales force compensation plan at XYZ Company is inadequate to retain an acceptable percentage of the firm’s salespeople, resulting in lost customers and decreased sales. Step 3: Problem(s) Statements and Setting Objectives 21 Step 4: Alternative Strategies Proposition, Evaluation, & Justification Strategy formulation involves the identification of alternative strategies, a review of the merits of each of these options and then selecting the strategy that has the best fit with a company’s trading environment, its internal resources and capabilities. § Strategies are agreed to be most effective when they support specific business objectives – e.g. increasing the online contribution to revenue, or increasing the number of online sales enquiries. § A useful technique to help align strategies and objectives is to present them together in a table, along with the insight developed from situation analysis which may have informed the strategy. 22
  • 101. 15/02/2020 12 Step 5: Implementation Plan/Actions and Control Mechanisms Implementation plan/actions § Implementation includes actions to be taken, the sequencing of marketing activities, and a time frame for their completion - First, students should explain the actions should be taken to implement alternative strategies. In doing so, describe any necessary internal marketing activities such as: – Employee training, employee buy-in and motivation to implement the marketing strategy, etc - Second, a timeline (e.g., Gantt chart, schedule planning table) should be provided in directing the implementation actions § Tip: Review literature related to Balanced Scorecards 23 Step 6: Implementation Plan/Actions and Control Mechanisms Control Mechanisms & KPIs § Specify the types of input controls/objectives that must be in place before the
  • 102. marketing plan can be implemented - e.g., financial resources, additional R&D, additional HR § Specify the types of process controls/objectives that will be needed during the execution of the marketing plan - e.g., management training, management commitment to the plan, revised employee evaluation/compensation systems, internal communication activities § Specify overall performance standards/objectives - e.g., sales volume, market share, profitability, customer satisfaction, customer retention 24 15/02/2020 13 Conclusion 5 Step Framework § Step 1: Situation Analysis (Macro environment - Industry, Competitors, & Customer environment) § Step 2: Internal Environment Analysis § Step 3: Problem(s) Statements and Setting Objectives
  • 103. § Step 4: Alternative Strategies Proposition, Evaluation, & Justification § Step 5: Implementation Plan/Actions and Control Mechanisms 25 15/02/2020 1 MAN3016: Marketing Strategy Lecture 2: Strategic Planning Process Dr Anastasios Siampos 1 Like us on Facebook: www.facebook.com/sbsmrm/ Visit us: www.surrey.ac.uk/department-marketing-retail- management 1 Purpose of marketing strategy To set the direction of the organisation and decide what product/s & in which markets the firm should invest its resources To define how it is to create value to customers To describe how it is to perform marketing activities (4/7Ps)
  • 104. better than competition 2 15/02/2020 2 Strategic Fit 3 3 Mission & Vision 4 15/02/2020 3 Mission & Vision Mission Statement – Answers… “What business are we in?” – Clear and concise – Explains the organisation’s reason for existence • Who are we? Who are our customers? What is our operating philosophy?
  • 105. What are our core competencies or competitive advantages? What are our responsibilities with respect to being a good steward of our human, financial, and environmental resources? Vision Statement – Answers… “What do we want to become?” – Tends to be future oriented – Represents where the organization is headed 5 5 The interrelationship between marketing and corporate strategy Corporate Strategy •Specifying the organisation’ mission •Allocation of resources across the whole organisation •Portfolio of activities for the organisation •Defining organisational objectives Marketing Strategy •Competing in a product market •Selecting market segments •Designing the mix •Guides •Directs •Controls •Co-ordinates
  • 106. •Informs •Achieves •operationalises 6 15/02/2020 4 The Marketing Strategy Process 7 7 Where do we want to be? Strategic Decisions 8 15/02/2020 5 Product types in the portfolio 9 Balancing the business portfolio 10
  • 108. 15/02/2020 8 Strategic Focus 15 15 Routes to competitive advantage 16 16 15/02/2020 9 Marketing Strategy – Two Perspectives Marketing strategy at the functional level Ø Planning and controlling the marketing activities Ø Planning and implementing the 4Ps/7Ps Ø Management customer relationship Marketing as a philosophy/orientation Ø Guiding the organisation’s overall activities Ø Playing a key role in the strategic management process (SMM)
  • 109. 17 Marketing Plan A written document that provides the blueprint or outline of the organization’s marketing activities, including the implementation, evaluation, and control of those activities ü How the organization will achieve its goals and objectives ü Serves as a “road map” for implementing the marketing strategy ü Instructs employees as to their roles and functions ü Provides specifics regarding the allocation of resources, specific marketing tasks, responsibilities of individuals, and the timing of marketing activities 18 18 15/02/2020 10 Thinking First Cognitively analysing a strategic marketing problem & developing
  • 110. the solution (the strategy) through a carefully thought-out process It can help to see the big picture occasionally throughout the process. It can involve some inspiration & insight, but largely the process is one of painstakingly doing your homework West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press. 19 Seeing First Importance of seeing the overall decision is sometimes greater than thinking about it Insight often only comes after a period of preparation, incubation, illumination & verification in the cold light of day. The 'eureka' moment West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press. 20
  • 111. 15/02/2020 11 Doing First (1) do something, (2) make sense of it (3) repeat the successful parts & discard the rest. Many companies have successfully diversified their businesses by a process of figuring out what worked & what did not Instead of marketing strategy – the reality is often that ‘doing’ drives West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press. 21 Simple Rules How-to rules keeping managers organised to be able to seize opportunities Boundary rules help managers to pick the best opportunities based geography, customers or technology Priority rules are about allocating resources amongst competing opportunities Timing rules relate to the rhythm of key strategic processes
  • 112. Exit rules are about pulling out from past opportunities West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press. 22 15/02/2020 12 Process and Temporality and the 4 Main Approaches to Competitive Marketing Strategy SIMPLE RULES SEEING FIRST DOING FIRST THINKING FIRST Long-Term Short-Term Experiential Cognitive TE M P O R
  • 113. A LI TY PROCESS West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press. 23 What to Choose? ü Thinking First/Market Orientation works best when the issues are clear, the data are reliable, the context is structured, thoughts can be pinned down & discipline can be applied ü Seeing First works best when many elements have to be creatively applied, commitment to solutions is key & communications across boundaries are needed (e.g. in NPD) ü Doing First or simple rules work best when the situation is novel & confusing, complicated specifications would get in the way & a few simple relationship rules can help move the process forward West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press.
  • 114. 24 15/02/2020 13 Reading Resources Chapter 2: Hooley, G., Piercy, N. F., and Nicoulaud, B. (2017), Marketing Strategy & Competitive Positioning, Prentice Hall, 6th Edition. Chapter 2: Ferrell, O. C. and Hartline M. D. (2014), Marketing Strategy, Cengage, 6th Edition. Additional reference: West, D. C., et al. (2015). Strategic marketing: creating competitive advantage. Oxford, United Kingdom, Oxford University Press. Dobni, C., and Luffman, G. (2000) Implementing marketing strategy through a market orientation. Journal of Marketing Management, 16(8), 895-916. 25 Teaching Schedule Week Lectures Seminars Week 1 - Introduction to the Module Case study analysis framework Week 2 - Strategic marketing planning Example case study – Situation analysis
  • 115. Week 3 - Competitive market analysis Example case study – Situation analysis Week 4 - Understanding the organisational resource base - Competing through innovation Example case study – SWOT analysis & problem identification Week 5 - Segmentation, positioning, and selecting target markets Example case study – Alternative strategies Week 6 - Creating competitive advantage Individual assignment Q&A Week 7 - Competing through marketing mix Example case study – Implementation & control Week 8 - Competing through superior service and customer relationships Costs of customer loyalty Week 9 - Strategy implementation and control Soft and hard control measures Week 10 - Ethics and social responsibility in marketing strategy - Evolving topics in marketing strategy Group discussion on CSR and crisis management
  • 116. Week 11 - Module Revision Exam preparation Q&A 26 15/02/2020 14 Thank you! Any Questions? 27 1 Generic Example of a Case Study Analysis Report Executive Summary This document outlines the structure of the case study analysis report and the examples of basic tables/figures that could be considered for different analyses. The structure of these tables is simple and easy to produce in WORD. Students are encouraged to search for and use more advanced frameworks, tables, and/or figures for each analysis. This document also provides generic guidelines and examples based on information provided in the “Global ice cream wars” case study.
  • 117. In the executive summary, students can provide information about the Unilever in the ice cream market and a brief overview of the challenges discussed in the case study. Brief information about the industry emerging trends or the company’s vision/mission can be indicated in the executive summary. Executive summary should be no more than 200 words (not included in the word count). Please use font size 12 for the main body of the report and font size 10 for the text in the tables and figures (i.e., similar to this example report). Please do not use small fonts in the main text and tables/figures. Table of Contents Contents Page(s) Executive Summary 1 Table of Contents 1 Situation Analysis – Analysis of Macro Environment 2 Situation Analysis – Analysis of Industry Competition and Competitors 3 Situation Analysis – Analysis of Customers 5 Internal Environment & SWOT Analysis 6 Evaluation of Current Strategies and Problem Statement 8 Alternative Strategies 9 References (optional) 10 2 Situation Analysis – Analysis of Macro Environment
  • 118. Students should discuss key macro-environmental factors identified in Table 1 that influence the industry and the studied company in the case study. The conclusion of this section should be no more than 100 words. Identified factors can be presented as bullet points. If there is no information in the case study concerning a macro environment factor (i.e., political), students can leave the related row in the table blank. For instance, students can discuss the importance of ice cream global market growth and related opportunities for Unilever. Table 1. PESTLE Analysis Macro-Level Factors Importance of key factors to the market or the company Political Macro-level information related to the government actions that may affect the business environment, such as tax policies, Fiscal policy, and trade tariffs. XYZ Economic Macro-level information related to inflation, employment, income, interest rates, taxes, trade restrictions, tariffs, business cycle, Willingness to spend, confidence, and spending patterns. e.g., Economic growth in many countries results growing the global market for ice cream around 3 per cent annually. Market growth represent an opportunity for companies in this
  • 119. industry. Socio-cultural Macro-level information related to cultural trends, demographics, and population analytics. XYZ Technological Macro-level information related to innovations in technology that may affect the operations of the industry and the market favourably or unfavourably. XYZ Legal Macro-level information related to consumer laws, safety standards, and labour laws. In some cases, political and legal issues can be grouped in one category. XYZ Environmental Macro-level information related to climate, weather, geographical location, global changes in climate, environmental offsets. XYZ 3 Situation Analysis – Analysis of Industry Competition and Competitors
  • 120. Students should discuss key micro-environmental factors that affect the industry competitive intensity and market attractiveness. Students should also identify and assess the competitors in the market. The conclusion of this section should be no more than 200 words. This section includes two analyses: First, the degree of industry competitive intensity and market attractiveness can be assessed using Porter’s Five Forces framework. This framework assesses the competitive intensity and, therefore, the attractiveness (or lack of it) of an industry in terms of its profitability. An "unattractive" industry is one in which the effect of these five forces reduces overall profitability. For instance, the global ice cream market is highly competitive due to high intensity of rivalry and bargaining power of customers, but it is attractive for existing companies -Unilever- given the high barriers for entry, low bargaining power of suppliers, moderate threat of substitute products, and growing the market size. This market is unattractive for new and small companies because of the high intensity of rivalry, bargaining power of customers, and barriers to entry. Students can adopt different templates (i.e., figures, tables) to present this framework and provide the conclusion of the analysis. Table 2. Five Forces Analysis Force Related Factors Assessment
  • 121. Intensity of rivalry § Number of competitors § Sustainable competitive advantage through innovation § Competition between online and offline organizations § Powerful competitors and level of advertising expense High, Moderate, or Low Threat of new entrants § Patents & rights § Government policy such as sanctioned monopolies § Capital requirements § Economies of scale § Product differentiation § Brand equity & customer loyalty § Access to distribution channels High, Moderate, or Low Threat of substitutes § Relative price performance of substitute § Buyer switching costs and ease of substitution § Perceived level of product differentiation § Number of substitute products in the market
  • 122. § Availability of close substitute High, Moderate, or Low Bargaining power of customers § Degree of dependency upon existing channels of distribution § Buyer switching costs § Buyer information availability § Availability of existing substitute products § Buyer price sensitivity § Differential advantage (uniqueness) of industry products High, Moderate, or Low Bargaining power of suppliers § Supplier switching costs relative to focal company switching costs § Degree of differentiation of inputs § Impact of inputs on cost and differentiation § Presence of substitute inputs § Strength of distribution channel § Supplier competition High,
  • 123. Moderate, or Low 4 Second, students should identify key competitors, analyse competitors’ current and future objectives (i.e., investment priorities), analyse competitors’ current strategies (i.e., current target markets and marketing mix strategies), and competitors’ current resource profile (i.e., tangible and intangible assets, competitive advantage). Students can adopt different templates (i.e., figures, tables) to outline competitors and provide the conclusion of the analysis. For instance, Tables 3 outlined key competitors indicated in the “Global ice cream wars” case study. The conclusion of this table should discuss the position of studied company (i.e., Unilever) in the market compared to its competitors, identify main current competitors (i.e., largest, strongest), and predict emerging competitors or emerging strategies of current competitors. Table 3. Competitor Analysis Competitor Overview Key success factors Acquisition
  • 124. strategy Heavily branded product range R&D and patents Flexibility to create new/local flavours Distribution channel Nestle (incl. Dreyer and Haagen Dazs in USA, and Scholler/ Mövenpick) § Brand competitor – 15% world market share § Target market: Super-premium, premium branded, and regular.
  • 125. ++ +++ +++ +++ ++ Häagen Dazs – rest of world § XYZ § XYZ n/a * + + n/a - Mars § XYZ § XYZ n/a ++ ++ n/a - Baskin Robbins § XYZ § XYZ n/a + + n/a - Other (i.e., Supermarket brands) § XYZ § XYZ --- --- --- n/a - Optional: Comparison with studied company – Unilever +++ +++ +++ +++ +++ * n/a: No applicable – Not indicated in the case study. 5 Situation Analysis – Analysis of Customers
  • 126. This section is the conclusion of multiple principles/frameworks introduced in Chapter 4 (customer analysis), Chapters 7, 8, and 9 (Segmentation/Positioning/Selecting Target Markets). For instance, please review Figure 4.2, Table 7.4, Figure 9.3 across Chapters 4, 7, and 9 in the core textbook (Holley et al. 2017, 6th Edition) in order to define the segment’s profile/characteristics. Please bear in mind that students may need to use insights from the company’s resource portfolio (as part of internal environment analysis) before analysing and completing Table 9.5 in Chapter 9. The conclusion of this section should be no more than 100 words. In this section, students should: § define the customer segmentation criteria (e.g., see Table 4); § identify primary target markets, secondary target markets, possibilities, and avoid target markets; and, § evaluate the current studied company’s current segmentation, positioning, and targeting strategies for identified market segments. Table 4. Customer segmentation by price and quality Segments Segment Profile/Characteristics * (Who? What? Where?) Segment Preferences (What? Why? How? When? Where?) Primary target:
  • 127. Premium branded § Lower-upper and upper-middle social classes § Mainly customers from developed economies (e.g., US and UK) § Relatively customers from developing economies (e.g., South Africa, China) § Good quality ingredients with individual, well- known branded names, such as Mars, Magnum and Extrême § Prices set above regular and economy categories but not as high as above: high value added Secondary target 1: Super-premium § Upper-upper and lower-upper social classes § Customers from developed economies (e.g., US and UK) § High quality, exotic flavours, e.g. Häagen-Dazs Mint Chocolate Chip, Ben & Jerry’s Fudge § Very high unit prices: very high value added Secondary target 1: Regular
  • 128. § Lower-middle and upper-lower social classes § Customers from developed economies (e.g., US and UK) and emerging economies (e.g., South Africa, China) § Standard-quality ingredients with branding relying on manufacturer’s name rather than individual product, e.g. Wall’s, Scholler § Standard prices: adequate value added but large- volume market Possibilities: Ice cream for cold weather § Upper-upper, lower-upper, and upper-middle social classes § Customers from developed economies (e.g., US and UK) § Good quality ingredients with individual, well- known branded names § Prices set above regular and economy categories but not as high as above: high value added Avoid targets: Economy § Lower-lower social class § Mainly customers from developing
  • 129. economies (e.g., South Africa, China) § Relatively customers from developed economies (e.g., US and UK) § Manufactured by smaller manufacturers with standard-quality ingredients, possibly for supermarkets’ own brands § Lower price, highly price competitive: low value added but large market – perhaps high- quality ingredients * Based on the information from the “Global ice cream wars” case study, this column is mainly based on logical assumptions. For instance, only upper-upper and lower-upper social classes afford to purchase super-premium products with high price tags. 6 Internal Environment & SWOT Analysis Students should also identify and assess the competitors in the market. This section includes two analyses: First, identification of the company’s strategic type based on Porter’s generic strategy types. Second, SWOT analysis. This section should be no more than 350 words. Identification of the company’s current strategic type helps to
  • 130. better understand its position in the market (linked to competitor analysis) and its positioning and targeting strategies (linked customer analysis). It also helps to assess the company’s value propositions and strategic decisions. For instance, companies with “focused differentiation strategy” are more likely to heavily invest in R&D and develop premium products. It also plays a critical role in defining the company’s problems and proposing relevant alternative strategies. For instance, proposing focused low-cost strategies is not appropriate with for leading brand, such as Porsche and Apple. It is recommended to suggest minimum two alternative strategies for companies with hybrid strategy type (i.e., one differentiation strategy and one low-cost strategy – please review papers on organisational ambidexterity). No table or figure is required for this section. SWOT analysis is a technique to identify a company’s strengths and weaknesses and its opportunities and threats in the market. Students can use multiple techniques/frameworks introduced in Chapters 6 (i.e., resource portfolio) to identify a company’s strengths and weaknesses. Students also can use the findings in the previous analyses (i.e., PESTLE, competitive environment, competitor analysis, customer analysis) to identify opportunities and threats in the market. SWOT analysis is designed for use in the preliminary stages of decision- making and can be used as a tool for evaluation of a company’s current strategies, performance, and position in the market.