Exam 1 (Ch 1-6) Flashcards
(96 cards)
1
Q
Marketing Strategy
A
A long-term, forward looking approach to planning with the fundamental goal of achieving a sustainable competitive advantage.
2
Q
Four Ps
A
Product, Price, Place, Promotion
3
Q
Four Cs
A
Customer, Cost, Convenience, Communication
4
Q
Outside In
A
Start with market to design strategy. Use deep marketing insights. Focus by all parts of organization: achieve, sustain, profit. What we do for the market? perspective of market. Put customer first. Relentless deliver of value to customers.
5
Q
Inside Out
A
What can the market do for us? Sell solutions of products and services.
6
Q
Winning from Outside In
A
how and why are customers changing? what new needs do they have? what can we do to solve their problems and help them make more money? what new competitors are lurking around the corner, and how can we derail their efforts?
7
Q
Inside Out Myopia
A
Positive reinforcement, competing priorities, contemporary strategy theories, darwin in the enterprise, going with the flow.
8
Q
Positive reinforcement
A
increase efficiency, quality improvement
9
Q
competing priorities
A
stakeholders closer than customers
10
Q
contemporary strategy theories
A
capabilities or resource based view; improve and exploit resources
11
Q
darwin in the enterprise
A
self preservation
12
Q
going with the flow
A
groupthink mentality
13
Q
market insight
A
invest in market intelligence; sense and act on market insight across organization - find patterns, identify opportunities; data is not knowledge or insight
14
Q
methods to gather customer data
A
behavioral analysis, customer feedback, demographic data, google analytics, industry data, primary research, social media analytics, third party research, trade shows, website analytics
15
Q
valuable market insights
A
accurate reflections of reality, actionable - inspire organization, develop or improve strategies; not seen or understood by competitors; used in novel way to influence strategy.
16
Q
four customer value imperatives
A
be a customer value leader, innovate new value for customers, capitalize on the customer as an asset, capitalize on the brand as an asset.
17
Q
customer value
A
trade off between the benefits that customers perceive they are receiving from a product/service and the perceived cost of obtaining these benefits. (I - perceived risk) x (perceived benefits - perceived life cycle costs).
18
Q
Perceived risks
A
uncertainty of choice
19
Q
perceived benefits
A
outcomes associated with product, service, or relationship with company.
20
Q
perceived life cycle costs
A
initial price paid; costs over product life cycle.
21
Q
marketing myopia
A
a short sighted and inward looking approach to marketing that focuses on the needs of the company instead of defining the company and its products in terms of the customers’ needs and wants; which results in the failure to see and adjust to the rapid changes in their markets.
22
Q
Customer value framework
A
attributes do not replace benefits - product attributes, customer demographics; customers vary their emphasis on costs and benefits - performance features, segmentation, future costs; customer value is dynamic - customer specific, market specific.
23
Q
30 elements of value
A
social impact, life changing, emotional, functional
24
Q
customer value leader
A
companies that outperform their rivals by delivering superior value to a distinct segment of the market - best product, best price, best service
25
customer value segments
performance value buyers; price value buyers; relational value buyers
26
performance value buyers
product that meets demanding requirements for quality, fashion and or functionality
27
price value buyers
best price for adequate level of performance or service
28
relational value buyers
premium on total solutions that meet needs beyond product attributes, including service, financing, technical assistance, etc.
29
customer value innovator
companies that drive growth by innovating new value for current customers and attracting new customers; push to innovate, utilize market insight, require full spectrum of innovation.
30
customer asset managers
companies that consistently turn customer value into valuable customers; purchase more in category, purchase across categories, purchase new products, respond to marketing activities, remain loyal, promote company.
31
capitalize on brand as an asset
companies that create a strong brand which makes a credible promise to deliver meaningful benefit; build brand as long term investment, protect brand against competition, optimize value of brand.
32
how imperatives operate as a system
be a customer value leader -> cap on customer as asset, innovate new value for customers, cap on brand as an asset -> be a customer value leader
33
what do market leaders have in common?
maximize benefits for the customer and for the firm, while minimizing costs and risks.
34
why is customer value leadership important
defines strategic direction of the business; shapes the investments that the firm must make and capabilities that it needs to develop; is the prerequisite and foundation for the the other three imperatives.
35
value position
company's ability to help its customers solve a problem that they cannot afford to ignore, better than any other option available to them
36
unique value position
for (primary target customers) and others who are dissatisfied with (their current situation), (solution name)is a (category name) that (compelling reason to buy). Unlike (their primary alternative options) what really sets (company name) solution apart is (your primary differentiation).
37
performance value priorities
does the product meet or exceed customer expectations on these attributes? perceived quality? functionality? innovative features?
38
price value priorities
is the price at an acceptable level for the quality and performance? perceived cost? price sensitive?
39
relational value priorities
is the service quality above the price and performance? technical assistance? bundles of complementary products? repair service? knowledgeable sales staff? financing or warranty?
40
how do customers choose?
focus on a subset of offerings; weight the value vectors; assess offering performance
41
focus on subset of offerings
what is the customers consideration set?
42
consideration set
the subset of brands that consumers evaluate when making a purchase decisions; product category? familiar/unfamiliar? recalled/unrecalled? not all companies!
43
Parity
acceptable level of value; meets the industry standard, but not differentiated along the axis.
44
assess offering performance
what are the customer's perceptions of the offerings against competition?
45
Perceived parity
meaningful difference from competition - below? at? above?
46
product life cycle
introduction -> growth -> maturity -> decline (or product extension)
47
evolving customer value positions
establish points of parity for all values - Herd mentality; change relative importance of values - product life cycle influences, market choices; anticipate competitive moves and reactions
48
be a customer value leader...
companies... choose their customer segments, offer a value proposition that is distinct from competitors, deliver this value with a business model that is optimized for their market
49
elements of customer value strategy
what is our primary business objective? what is our customer value proposition? what is our business model for delivering and monetizing customer value?
50
business objectives
what does a company want to achieve - actionable, specific, measurable, time bound; guides the customer value proposition and business model
51
customer value proposition
what are the tangible and intangible benefits that the target customers will receive from the product or service? - better than competition, inline with customer's value proposition; three interlocking choices - target customer segment, offering, competitive profile.
52
offering
core benefit - what business are we in? marketing myopia; actual product; augmented product
53
business model
how will the company profitably fulfill the value proposition? - complex and abstract representation of the business; questions to consider - what business activities are necessary to create the value that has been promised to its customers? - value creating system; how does the business make money while creating value for its customers? - value capturing system
54
value creating system
all the activities that the firm links together to create and deliver customer value, including basic inputs to create products/services through the channels to sell, service and distribute the offering
55
value capturing system
how a business profits from its transactions - payment, fixed and variable costs, cash flow
56
how can companies capture more value
innovation categories: changing the price setting mechanism, changing the payer, changing the price carrier, changing the timing, changing the segment; innovation strategy: value based pricing, two sided market model, bundling and unbundling, installed base pricing, target costing.
57
3 types of value propositions
performance value leadership; price value leadership; relational value leadership
58
performance value leadership
relentless innovation - functionality, features/design, superior quality; performance value strategy - peerless quality, experiential or emotional impact
59
price value leadership
best price - not the cheapest, lowest total life cycle costs; two options - disciplined cost management, superior pricing acumen.
60
relational value leadership
develop deep customer relationships - trust with expertise, more than core product, tailored offering; customer relationship management (CRM); comprehensive solution management.
61
dashboard metrics
identify metrics to reflect strategic priorities of firm's customer value leadership choices - drivers of financial performance - economic profit, operating profit, cost of assets (fixed and working capital); diagnostics financial measures - gross margins, days' receivables, inventory turns
62
innovation
a new method, idea, product, etc.
63
how do customer value innovators outperform the competition?
deep market insights and foresights, more expansive approach to innovation, supportive environment that nurtures innovation.
64
customer value innovation
the process by which customers choose to adopt innovative ideas - drive adoption, sustain customer engagement
65
growth options
make, buy, or both
66
make
grow organically from within - identify new opportunities, build capabilities internally, can take longer but can result in risk adjusted profits
67
buy
acquire into new markets; gain immediate market share
68
both
guide with an outside in guiding logic
69
organic growth challenge
external constraints and internal impediments
70
external constraints to growth
"red ocean" markets, customer pressures, compete for incremental share gains against rivals
71
internal impediments to growth
short term incentives, urgent demands from customers suppliers and salespeople, risk adverse cultures, inferior innovation capabilities.
72
innovation continuum
small i innovation and big i innovation
73
small i innovation
exploitation of existing capabilities, incremental, continuous improvement, "red ocean" (from the blood of competitors), low risk small rewards
74
big i innovation
exploration of new market spaces, discontinuous, disruptive, "blue ocean" (uncontested open water), high risk large reward
75
adjacencies
achieve a better balance of risk and reward by striking into new territory while drawing on the business' resources and market knowledge
76
adjacencies product/service
new offerings that may overlap with company's technology and manufacturing competency, quality, standards, and intellectual property; reduce risk of innovation; leverages its knowledge to be efficient; reach current customers
77
adjacencies market
new market to the business but has some relationship with the firm's current market; leverage firm's current offerings, brand, distribution and sales
78
full spectrum innovation
creatively thinking about ways to grow by creating new value for customers - expand outside in thinking, business model, examine every strategic dimension for possible growth
79
innovate with customer value proposition
customers, offerings, competitive profile
80
innovate with customers
challenge customer boundaries - what other needs of our current customers can we serve? meet needs of non customers - what other customers could use our capabilities? evaluate past, present, and prospective customers in current markets - are there new or emerging growth segments that are not being served? are there latent needs that our business can satisfy? Penetrate new geographies.
81
innovate with offerings
develop new core products or services for new or existing customers; create bundled solutions that save time or money, reduce risk, or allow customer to make more money - pick what works; redesign customer experience - create meaning in customer's lives; extend brand into new domains.
82
competitive profile
reconfigure competitive profile - eliminate, reduce, increase, add
83
innovate with the business model
value creating system; value capture system
84
innovate with business model - value create system
value chain - sequential activities that take the product from supply to channels to the market - lower costs, increase efficiencies.
85
innovate with business model - value capture system
innovations in how the company gets paid for the value it creates - untapped revenue sources, novel pricing schemes, partnership approach
86
processes to manage growth portfolios
set ambitious growth objectives and support them with resources and vocal top management; systematically search for growth opportunities along the full spectrum of innovation pathways; overcome the thought to do small i initiatives and shift toward higher risk adjusted returns; encourage managers to take calculated risks - think big, start small, fail cheap, scale fast; ground the process with deep customer insight
87
if you innovate and it doesn't end up as something that the customer benefits from, then it's not innovation
if you innovate and it doesn't end up as something that the customer benefits from, then it's not innovation
88
stages for managing value innovation as an outside in process
1) select growth strategy, 2) diagnose the opportunity portfolio, 3) expand search for opportunities, 4) identify and contain risks, 5) organize and realize.
89
growth strategy's purpose
establish resource requirements, guide the search for opportunities, mobilize the organization; compass, not a roadmap. 3 issues to be addressed: growth objectives, scope, and emphasis on make versus buy
90
growth gap
the gap between objectives and current strategies. what was planned vs what actually happened.
91
diagnose the opportunity profile
assess the potential of the available growth initiatives in portfolio to close the growth gap
92
expand search for growth opportunities
best opportunities result from a systematic search of the growth pathways of the full spectrum of possibilities. ways to find attractive possibilities - penetrate served market; expand adjacent markets; explore beyond adjacent markets.
93
identify and contain risks
growth initiatives promises superior returns within a reasonable level of risk - screening for opportunity (RWW); investing in real options (cautious investments, pilot opportunity); sharing risks with partners (knowledge brokers, design firms, equity stake in innovators)
94
Real-Win-Worth it
is it real? can we win? is it worth doing?
95
dashboard of innovation metrics
identify weak links in overall innovation process and costly disconnects between growth strategy and the portfolio of growth initiatives; hold managers accountable by setting targets for improvements and linking incentives to reach them; provide a holistic picture of innovation process and the prospects for the portfolio to close the growth gap
96
metrics for managing the value innovation process
dashboard must reflect customer value strategy and customized for the market. Pitfalls to avoid - emphasizing results over diagnostic insights; encouraging incremental innovation.
innovation inputs; innovation process measures; innovation performance outcomes
