代写 assignment MKTG 1501
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代写 assignment MKTG 1501
MKTG 1501
Week 2
Creating Value and
Competitive Advantage
After today you should be able to…
1. Explain how customer value is delivered.
2. Define customer value, customer satisfaction,
and customer retention as the central concepts in
delivering value to customers.
3. Discuss competitor analysis.
4. Explain the fundamentals of competitive
strategies and competitive positions.
MKTG1501 - Week 2: Creating Value and Competitive Advantage 2
Recapping from last week:
MARKETING CONCEPT
• Holds the key to achieving organisational goals.
• Places the consumer as the focal point.
Has four premises
1. Consumer orientation
2. Continuous marketing research
3. All organisational activities and strategies are
integrated
4. Aims to convert satisfied consumers into loyal
consumers.
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Is marketing just another
word for selling?
4
Inside-out approach
Focuses on existing
products and heavy selling.
The aim is to sell what the company
makes, rather than making what
the customer wants
MKTG1501 - Week 2: Creating Value and Competitive Advantage
Outside-in approach
Focuses on the customer
Alternative management
philosophies and cultures
• The production philosophy.
• The product philosophy.
• The selling philosophy.
What are some of the issues with these
philosophies?
5 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Delivering value to customers
• Market-oriented culture is the overarching culture
that focuses on markets – the belief that the
purpose of business is to create superior customer
value.
Strong market-oriented culture = Strong business
performance / profits.
Strong market-oriented culture is reflected by:
1. Deep understanding of customers
2. Awareness and knowledge of competitors
3. Strong collaboration across all functions of the firm
4. Leadership actions that focus on the customer
6 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Customer value
Customer Value: The difference between the
benefits the customer gains from owning and using a
product and the cost of obtaining the product.
代写 assignment MKTG 1501
Example – Buying a Toyota Prius
Benefits
low running costs, fuel efficiency,
compact size, warm-fuzzy feeling, socially
responsible image, freedom to travel at
any time, privacy & safety by avoiding
public transport.
These benefits (may) outweigh the
costs of obtaining the product.
$52,000
$23,750
OR
Customers are value maximisers
• Customers will buy from the firm that they believe can
provide them with the highest customer delivered value
(or the difference between total customer value and total
customer cost).
• When customers decide on the value they get from a
product or service, they will only consider the features that
are important to them.
• Customers’ perceptions of the value of a product or service
is a strong predictor of purchase and their experience with
the product will influence future choice.
• An important part of the experience is customer
satisfaction.
8 MKTG1501 - Week 2: Creating Value and Competitive Advantage
So is value equal to price?
Your turn… this is your turn to talk!
Write down your last major product purchase
and discuss with your colleague next to you.
1. Did you buy the cheapest alternative? Why or
why not?
2. What did you use to compare the value between
the product you actually bought and the
alternatives?
3. Are you satisfied with your purchase?
4. Did you think about whether you actually made
the best choice after you got home?
9 MKTG1501 - Week 2: Creating Value and Competitive Advantage
How much for a coffee?
Rank these three coffees in order of quality.
10 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Is it better coffee or do customers just think it is
better? How do you value these?
Do customers value ALL the features
of a product?
• Features = attributes of a product
• Benefits = are attributes you will use
Which provides the value for the customer?
Think about all the features your phone has:
How many do you actually use?
How many do you see as a benefit?
Why did you buy all those extra features?
Were you ripped off?
Would you buy the product again?
11 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Quality / Customer satisfaction:
Are they the same?
Take a look at these
restaurants
Would these be
quality restaurants?
Are you satisfied
with the dining
experience?
12 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Customer satisfaction
Customer satisfaction is the customer’s conscious evaluation of a
product or service feature, or of the product or service itself.
Satisfaction judgments are influenced by many factors:
13 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Generally, customer satisfaction
depends on the product’s performance
relative to the buyer’s expectations.
• Past experiences
• The information and promises
made by marketing organisations
• Company’s competitors or
competing products
• What seems like fair value
Customer satisfaction
The extent to which a product’s perceived
performance matches a buyer’s expectations:
• If a product exceeds our expectations, we are
satisfied with it. If the product fails to meet our
expectations, we are dissatisfied.
• It is important for companies to ensure that
customer expectations are matched by the
performance of products or services.
• Satisfaction is closely linked to quality.
Do you need to experience the product to be
satisfied with it?
14 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Complex mix buyer needs
15 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Buyers’
Level of
Satisfaction
63% Level of Influence
On Buyers’ Satisfaction
37% Level of Influence
On Buyers’ Satisfaction
Functional
Attributes
Psychological
Attributes
“Must-Haves”
“Delighters”
Meeting Standards
Operating trouble free
Performing as expected
Product uniformity
Eager to satisfy
Ability to respond to requests
Consideration for the customer
Being innovative
Measuring customer satisfaction
and loyalty
Tools for assessing, measuring and tracking customer
satisfaction and loyalty are continually increasing in
sophistication and may include:
• Customer satisfaction and loyalty surveys.
• Complaint and suggestion systems.
• Mystery shopping and customer interviews.
• Lost customer analysis.
16 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Retaining customers by building
customer relationships
Totally satisfied customers are more likely to be loyal
customers.
BUT
17 MKTG1501 - Week 2: Creating Value and Competitive Advantage
1. The relationship between
satisfaction and loyalty
varies across industries and
competitive situations.
2. Satisfaction alone does
not achieve loyalty.
Relationship marketing
• As companies shift their focus
from single sales encounters,
they are beginning to develop
strategies and actions that recognise how
ongoing relationships contribute
to customer retention.
• The focus is on retaining profitable
customers often known as
‘key customers’ and holding their
loyalty by totally satisfying them.
• Some customers do not want a relationship with a
company, for example, in the case of impulse buying.
18 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Relationship levels
19 MKTG1501 - Week 2: Creating Value and Competitive Advantage
It is possible to identify five different levels of
relationships that can be formed with customers who
have purchased a product.
Partnership
Proactive
Accountable
Reactive
Basic
Relationship ties: Financial benefits
• Financial benefits are one method that can be
used to assist in developing closer relationship
levels with consumers.
• An organisation might offer consumers financial
benefits to build closer relationships – e.g.
Loyalty programs
• Cafes
• Woolworths
• Frequent Flyers
20 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Relationship ties: Social benefits
• As many financial benefits can be imitated by
competitors, a company may choose to focus on
adding social benefits.
• An organisation that does this will choose to focus on
the social bonds with customers by learning about
their customers’ needs and then individualising these
and personalising their products and services.
• For example, if you have a preference for a window
seat, the airline may offer you one when it
distinguishes a pattern in your seating allocation.
21 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Relationship ties: Structural ties
• Not every organisation wants close ties with
consumers
• Structural ties refer to the links that an
organisation may provide to a consumer to
assist with its own business, such as software
for inventory or orders. Customers may be able
log into a website to check their order status.
• How organisations use each of these methods
will vary depending on how close they want to
be with their customers.
22 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Retention and customer profitability
Marketing is the art of attracting and keeping
profitable customers.
• 20-40% of customers do not represent profitable
sales (So why keep them?)
• Many new companies now view marketing as an
investment rather than an expense, which has
resulted in the development of better measures of
return on marketing investment (ROMI or
marketing ROI).
23 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Customer lifetime value
• Customer lifetime value is the amount by which
revenues from a given customer over time will exceed
the company’s costs of attracting, selling and servicing
that customer.
• Note how the definition highlights lifetime revenues
and costs, not profit from a single transaction.
Does this mean that a long-term customer
is more viable than a short term one?
24 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Strategies for competitive advantage
Competitive advantage = satisfying target customers
needs better than your competitors
1. First step: competitor analysis
2. Then develop competitive marketing strategies
25 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Competitor analysis
Who are your competitors?
• Direct competitors e.g. Pepsi/Coke
• Indirect competitors e.g. Pepsi/Mt Franklin
What are their objectives?
• Why are Coles selling milk for $1/litre
http://www.youtube.com/watch?v=bvaevUxtcO8
Identify competitors strategies
• What strategies do Target have?
• Are they the same as David Jones?
Assess their strengths and weaknesses
26
What drives industry competitiveness?
27
Selecting competitors to attack and to avoid
• Strength of competitors
• Customer Value Analysis
28 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Competitive Analysis (taken from sample marketing plan on Blackboard)
Competitor House of
Fabrics
Warehouse
Fabrics
JoAnn's Interior
Designers
Design
Specific Ltd
Product and/or Service
Quality 7 8 6 2 6
Selection 6 7 3 1 8
Price 5 8 2 2 8
Location and Physical Appearance
Visibility 8 7 8 3 6
Convenience Factors 6 6 6 3 8
Added Value Factors
Pre and Post Sales Service 5 4 5 8 9
Experience 4 4 4 7 7
Expertise 6 5 6 9 8
Reputation 2 8 6 8 8
Image 3 3 3 6 8
Other Marketing Activities
Established Sales Channels 6 6 4 3 6
Advertising 6 7 4 5 7
Total 78 87 69 68 112
Competitive strategies
29 MKTG1501 - Week 2: Creating Value and Competitive Advantage
1. Overall cost leadership
• Can offer lower price than competitors
e.g. Coles current strategy
2. Differentiation
• Concentrate on highly differentiated products
e.g. Apple ipad
3. Focus
• Concentrate on a small piece of the
market
e.g. Shannons Motoring Insurance
Supermarket strategies:
30 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Cheap prices vs. Quality
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Benchmarking
Fuji Xerox iPhone
New Entries Brand Value 2013
Brand Top 10 2012
31
32
The Generic Value Chain (Porter, 1985)
Competitive positions
Market leader
• Largest market share.
• Leads others in price changes, new products,
promotional spend
Market challenger
• Usually 2 nd biggest firm on the market
• Fighting hard to increase market share
Market follower
• Wants to hold market share without rocking the boat
Market nicher
• Serves small segments not served by other firms
33 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Competitive positions
MARKET LEADER
• Holds the largest market share.
• Typically leads other firms in price changes, new product introductions, distribution coverage
and promotion spending.
• A leader should constantly maintain a vigil on its competitors since they try to challenge its
strengths or try to take advantage of its weaknesses!
To remain the number one necessitates three actions:
1. Expanding the total market: Can expand market share by developing new users, new uses
and more usage of its products. This can be either increasing usage applications, or increasing
usage frequency (e.g. hand sanitisers: not just in bathroom but in kitchen, around play areas,
office reception desks).
2. Protecting market share: Leaders can protect their market share from competitors by working
on their weaknesses, keeping costs down and prices in line with consumer’s perceived value
of the brand. They should be involved in continuous innovation.
3. Expanding market share: Market leaders should increase their market share to retain their
supremacy. For example a 1 % growth of market share in soft drinks is worth $500 million!
34 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Competitive positions
MARKET CHALLENGER
A market challenger tries aggressively to expand market share by attacking the market. Firms
that are second and third or lower in an industry usually adopt market challenger strategies.
• Can attack the market leader - a high risk with potentially high-gain strategy. Suitable if the
leader is not serving the market well.
• Success requires some kind of sustainable competitive advantage over the leader- a cost
advantage leading to lower prices or the ability to provide better value at a premium price.
For example, Samsung entered the market late, as a challenger, but quickly became the market
leader.
• Challengers can also attack firms of its own size or smaller, local and regional firms to increase
market share and build incremental market dominance.
• Market challengers may launch a full frontal attack, matching the competitor’s product,
advertising, price and distribution efforts. They attack the competitor’s strengths rather than
weaknesses.
• Can also make an indirect attack at the competitor’s weaknesses or gaps in the market
coverage. It might target new geographic markets or poorly served segments.
35 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Competitive positions
MARKET FOLLOWER
Allows dominant firms to lead the way and keeps close tabs on the leader’s
activities in order to copy (or improve) upon the leader's product releases
and marketing efforts
Market follower firms fall into one of three types:
1. The cloner closely copies the leader’s products, distribution, advertising
and other marketing moves
2. The imitator copies some things from the leader but maintains some
differentiation in terms of packaging, advertising, pricing and other factors
3. The adaptor builds on the leader’s products and marketing programs,
often improving them
36 MKTG1501 - Week 2: Creating Value and Competitive Advantage
Competitive positions
MARKET NICHER
• Slow but growing rate of sales and market share
• Relatively low market impact, aims to attract minimal attention of competition in
the market
• Gets to know the target group so well it can meet its needs better than other
firms that casually sell to this niche
Areas in which to niche:
37 MKTG1501 - Week 2: Creating Value and Competitive Advantage
End-use specialist Customer size specialist
Specific customer specialist Geographical specialist
Product or feature specialist Quality—price specialist
Service specialist
Summary of key points from today
• Customers base their choices as to what they buy and what
they will re-buy on their perceptions of quality, value and
service.
• Customer satisfaction is the customer’s fulfilment response
regarding a product or service feature of the product or service
itself.
• Delivery of value requires a series of activities inside and
outside the company.
• A marketing system should sense, serve and satisfy consumer
needs and improve the quality of consumers’ lives.
• Firms will always have competitors and so must develop
strategies to suit their situation and potential reactions.
• Firms will take different positions in the market depending on
market share or target market.
38 MKTG1501 - Week 2: Creating Value and Competitive Advantage
代写 assignment MKTG 1501
