© bill swinyard music2go 1 music2go: a battle between cd player mfrs
Post on 02-Jan-2016
213 Views
Preview:
TRANSCRIPT
© Bill SwinyardMusic2Go Music2Go 11
Music2Go:Music2Go:A Battle Between CD A Battle Between CD
Player MfrsPlayer Mfrs
© Bill SwinyardMusic2Go Music2Go 22
OverviOverviewew
Medical education Medical education
Beyond lecture, casesBeyond lecture, cases
Systems thinkingSystems thinking
Lessons for Lessons for strategy formulationstrategy formulation
tacticstactics
© Bill SwinyardMusic2Go Music2Go 33
Business School Business School CriticsCritics
Assert that we Assert that we Place . . .Place . . . Too much emphasis on quantitative Too much emphasis on quantitative
analysis, tools, models, and theory analysis, tools, models, and theory Too little emphasis on qualitative thinking, Too little emphasis on qualitative thinking,
complex tradeoffs, execution, and complex tradeoffs, execution, and creativitycreativity
Too much emphasis on short term Too much emphasis on short term performance performance
Too little attention on interpersonal Too little attention on interpersonal relationships and social ethics relationships and social ethics
Not enough on long term success Not enough on long term success
© Bill SwinyardMusic2Go Music2Go 44
How We Learn:How We Learn:Passive vs Active Passive vs Active
LearningLearningActAct
ObserveObserveDecideDecide
Update mental model,Update mental model,Evolve strategy and rulesEvolve strategy and rules
Adapt,Adapt,ReflectReflect
© Bill SwinyardMusic2Go Music2Go 55
DecisionsDecisions ResultsResults
Observe Observe ResultsResults
Modify Modify DecisionsDecisions
Active Active Learning withLearning with
The The MarketplaceMarketplace
Make Make DecisioDecisio
nsns
ReflectionReflectionRepeat as often as you wishRepeat as often as you wish
ModifyModifythinkinthinkin
gg
MusicMusictotoGoGo
MusicMusictotoGoGo
© Bill SwinyardMusic2Go Music2Go 66
Define the Mission of the Organ.
Determine Organ.
Objectives
SWOTAnalysis
Formulate Strategy
Implement Strategy Through
Operating Plans
Monitor and Adapt Strategies when Necessary
Based on Feedback
Corporate Level
Marketing Department
Feedback
Fee
db
ack
Planning, Planning, Implementation, Implementation,
ControlControl
© Bill SwinyardMusic2Go Music2Go 77
Game Game ScenarioScenario
Consumer Electronics MfrConsumer Electronics MfrYou are:You are:
Portable CD Player (PCDP)Portable CD Player (PCDP)VP MarketingVP Marketing
1996 – 20011996 – 2001MarketMarket
Growth-Growth-StageStage
ProductProduct
U.S. Only,U.S. Only,40mm HH40mm HH
Competitor: EWS AudioCompetitor: EWS AudioHas strongerHas stronger
market position & resourcesmarket position & resourcesthan youthan you
© Bill SwinyardMusic2Go Music2Go 88
Game Game OverviewOverview
Two PCDP firms – you & EWS Audio
You will make decisions relating to all four areas of the marketing mix
2 consumer market segments differentiated by
• age• income
• family• tastes
• lifestyle
• distribution
• promotion• pricing
• product design
© Bill SwinyardMusic2Go Music2Go 99
Marketing Mix & Marketing Mix & TargetsTargets
2 Competitors• EWS Audio• You
Objective:Objective:
HigherHigherMkgt Contrib.Mkgt Contrib.
than EWSthan EWS
Standard
Youth
For Control of
2 Market Segments
Promotion
Distribution
Product Design
Pricing
© Bill SwinyardMusic2Go Music2Go 1010
Product Strategy:Product Strategy: Attributes, Segments, Attributes, Segments,
& Evolution& Evolution
Tec
hn
ical
Sp
ecs
Style
Standard
Youth
• Less active• Price conscious• Want simple tech• Newspapers
• Fashion conscious• Price sensitive• Want avg tech specs• TV, Radio
Note AttributesSegment positionSegment size & evolution
© Bill SwinyardMusic2Go Music2Go 1111
Promotion Promotion StrategyStrategy
AdvertisingAdvertising Sales Sales PromotionPromotion
OptimizingOptimizingthe Mixthe Mix
Media selectionMedia selectionTelevisionTelevisionRadio & station Radio & station
formatformatNewspapersNewspapersMagazine & Magazine &
categorycategory
Trade Trade showsshows
Sales Sales trainingtraining
Premiums Premiums POP POP
displaysdisplaysRebatesRebates
Market Market segmentssegments- lifestyle- lifestyle- demographics- demographics
Product life Product life cyclecycle
Media type & Media type & char’schar’s
© Bill SwinyardMusic2Go Music2Go 1212
Promotion Promotion StrategyStrategy
Advertising
SalesPromotion
ConsumerDemand(Sales)
Distributioncoverage
ProductAwareness
Distributorperformance
© Bill SwinyardMusic2Go Music2Go 1313
Distribution Distribution StrategyStrategy
Distribution Distribution ChannelsChannels
Optimizing Optimizing DistributionDistribution
Consumer Electronics Stores(e.g., Circuit City)
Department Stores(e.g., Sears)
Discount Stores(e.g., Wal-Mart)
Market Segments’- purchase behavior- demographics
Channelcharacteristics
Sales Rep support
© Bill SwinyardMusic2Go Music2Go 1414
Distribution Distribution StrategyStrategy
SegmentDemand
Channelmatch
# SalesReps
RepSalaries Consumer
Demand(Sales)
PotentialSales
Coverage
DistributorSupport
© Bill SwinyardMusic2Go Music2Go 1515
Pricing Pricing StrategyStrategy
Market ConditionsMarket Conditions Optimizing PriceOptimizing PriceEstablished
productPrice ranges
dictated by marketAbility to reduce
variable costs through R&D
Segment characteristics- price elasticity - price ranges
Product life cycle stage
Prices vary by channel- discount stores- electronics stores
© Bill SwinyardMusic2Go Music2Go 1616
Pricing Pricing StrategyStrategy
R&DSpending
RecommendedRetail Price
(RRP)
Manufact’g Cost
PreferredPrice Range(by segment)
RetailMarkup
Competitor’s Price
Discount
BaseCost
© Bill SwinyardMusic2Go Music2Go 1717
Market Market SegmentsSegments
Demographics• 18 years and less• Fashion conscious• Purchases made by
parents
Promotion• Mass media• Point of sale
promotion
Product• Emphasis
on style
Distribution• Deep product
assortment• Want customer
service (purchase advice)
Pricing• $50- $60• Relatively price
sensitive
YouthSegment
© Bill SwinyardMusic2Go Music2Go 1818
Market Market SegmentsSegments
StandardSegmentDemographics
• 19-34 yrs old• Less active
lifestyle• No dependents• High disposable
income
Product• Newspapers,
magazines, TV• Average styling &
technology
Pricing• $60-$100• Not too price
sensitive
Distribution• Broad product
line (accessories)• Want customer
service (sales advice)
Promotion• Broad reach
media• Distributor sales
force training
© Bill SwinyardMusic2Go Music2Go 1919
The Product The Product Life CycleLife Cycle
Marketing Marketing VariableVariable
GrowthGrowth MaturityMaturity DeclineDecline
ProductGoal
Improve product specifications
Differentiated Reduce
product cost
Minimize cost
PriceGoal
Reduce over time
Lowest Increasing
DistributionGoal
Intensive Intensive Selective
PromotionGoal
Build brand preference
Get apurchase commitment
Counteract substitution
© Bill SwinyardMusic2Go Music2Go 2020
Think of Early SpendingThink of Early Spendingas an Investmentas an Investment
$$$
Time
Costs to set up & grow the business
Revenue
Venture capitalto cover losses
Profits toinvestors
© Bill SwinyardMusic2Go Music2Go 2121
TeaTeamsms
Up to 3 people Up to 3 people Can change teams at any timeCan change teams at any time Good mix of skillsGood mix of skills
Computer-literateComputer-literate Good record-keepingGood record-keeping Planning-orientedPlanning-oriented CustomerCustomer-oriented!-oriented!
Thorough reading of in-game Thorough reading of in-game documentation!documentation!
© Bill SwinyardMusic2Go Music2Go 2222
Plan of Action Plan of Action for M2G Ifor M2G I
Form a groupForm a group Review the M2G tutorial pps fileReview the M2G tutorial pps file Read/review the Student Manual – teach Read/review the Student Manual – teach
each othereach other Download & install the simulationDownload & install the simulation Complete three years (to 1999) using Complete three years (to 1999) using
frequent rollbacks frequent rollbacks Goal after rollbacks & trial experience: Goal after rollbacks & trial experience:
as close as you can get to EWS in NMC as close as you can get to EWS in NMC after three rolloversafter three rollovers
Expect 4-6 hours of time together/aloneExpect 4-6 hours of time together/alone
© Bill SwinyardMusic2Go Music2Go 2323
Key Benefits of PlayingKey Benefits of Playing
Develop teamworkDevelop teamwork
Refine your decision-making skillsRefine your decision-making skills
Facilitate learning of basic Facilitate learning of basic marketing concepts marketing concepts
Develop strategic planning & Develop strategic planning & execution skills execution skills
© Bill SwinyardMusic2Go Music2Go 2424
Key Benefits of the GameKey Benefits of the Game
Instill a bottom line focus and the Instill a bottom line focus and the simultaneous need to deliver customer simultaneous need to deliver customer value value
Discover the importance of market data Discover the importance of market data & competitive signals to adjust the & competitive signals to adjust the strategic plan & tacticsstrategic plan & tactics
Build confidence through knowledge & Build confidence through knowledge & experienceexperience
© Bill SwinyardMusic2Go Music2Go 2626
These are the numbers toadd up to get the exactCumulative contribution
Being able to report the exact amount
© Bill SwinyardMusic2Go Music2Go 2727
What a What a waste of waste of
time!time!
Music2Go:Music2Go:Various PerceptionsVarious Perceptions
It’s been a It’s been a good good
learning learning experienceexperience
My team My team has been has been
funfun
I should I should have sold have sold my ideasmy ideas I wish I I wish I
had had thought thought
moremore
This has This has been been
stupidstupid
© Bill SwinyardMusic2Go Music2Go 2828
Best PracticesBest Practices Strategy definition.Strategy definition. Understand the Understand the
difference between difference between strategystrategy and and tacticstactics … & have a clear approach … & have a clear approach for each quarter.for each quarter.
Systematic thinking.Systematic thinking. Create a Create a strategy that is balanced between strategy that is balanced between present decisions and future present decisions and future outcomes. outcomes.
Execution.Execution. Use consistent & faithful Use consistent & faithful execution of strategy. execution of strategy.
© Bill SwinyardMusic2Go Music2Go 2929
Rollback, rollback, rollback.Rollback, rollback, rollback. See how See how things work, rollback, change things work, rollback, change
Understand the market.Understand the market. Know the fine Know the fine details of what your segments wantdetails of what your segments want
Reporting.Reporting. Document key learning points Document key learning points during & between runs in a “game log.”during & between runs in a “game log.”
Team structureTeam structure. Try to match team . Try to match team strengths to the tasks of decision strengths to the tasks of decision making. making.
Best PracticesBest Practices
© Bill SwinyardMusic2Go Music2Go 3030
HintsHintsFind out what people want orFind out what people want or
what competitors what competitors havehave
Tell them you have what they Tell them you have what they wantwant
Get retailer supportGet retailer support
Close the saleClose the sale
MarketingMarketingresearchresearch
Advertise in theAdvertise in theright mediaright media
Sales force, in Sales force, in the right storesthe right stores
•Retailer supportRetailer support•AdvertisingAdvertising•Product mixProduct mix
Develop what people wantDevelop what people want Product designProduct design& pricing& pricing
© Bill SwinyardMusic2Go Music2Go 3131
Reactions to a CharacteristicReactions to a Characteristiceg., advertising spendingeg., advertising spending
More isbetter
High
LowLess More
Some adds value,too much is bad
High
LowLess More
Little response‘til thresholdis crossed
High
LowLess More
Any amountis bad
High
LowLess More
High
LowLess More
More is good,to a point ofdiminishing
returns
A little isjust rightHigh
LowLess More
© Bill SwinyardMusic2Go Music2Go 3232
HintsHints Work with a group.Work with a group. Group decisions are Group decisions are
much better than solitary ones; most much better than solitary ones; most who didn’t work in groups say they who didn’t work in groups say they wished they had.wished they had.
Read, know, & understandRead, know, & understand the the documentation.documentation.
Use your strategy as the guide in Use your strategy as the guide in making decisions.making decisions. Stick to your strategy, Stick to your strategy, but still be flexible enough to revise.but still be flexible enough to revise.
Follow the Hints.Follow the Hints. Maximize the customer experience.Maximize the customer experience.
© Bill SwinyardMusic2Go Music2Go 3333
Maximize the Customer Maximize the Customer ExperienceExperience
1. How well 1. How well do you meet do you meet
customer customer needs? needs?
2. How 2. How smoothly smoothly
do you do you solve your solve your customers’ customers’ problems?problems?
3. How 3. How quickly do quickly do
you anticipate you anticipate what they’ll what they’ll want next?want next?
Source: “The Customer Experience,” Net Company, Fall 1999.
& do all& do allthese thingsthese thingsbetter thanbetter than
the competitionthe competition
© Bill SwinyardMusic2Go Music2Go 3434
Plan, Implement, Plan, Implement, ControlControl
Define the Mission of the Organ.
Determine Organ.
Objectives
SWOTAnalysis
Formulate Strategy
Implement Strategy Through
Operating Plans
Monitor and Adapt Strategies when Necessary
Based on Feedback
Corporate Level
Marketing Department
Feedback
Fee
db
ack
top related