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Market-Based Management

Market-Based Management. Chapter 11, 12, 13 Portfolio Analysis and Strategic Market Planning. Figure 11-1 Product Life Cycles of Two Product Portfolios . Which would you rather have?. Figure 11-6 Product Life Cycle/Share Development Portfolio. Factors Impacting Mkt Attractiveness.

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Market-Based Management

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  1. Market-Based Management Chapter 11, 12, 13 Portfolio Analysis and Strategic Market Planning

  2. Figure 11-1 Product Life Cycles of Two Product Portfolios Which would you rather have?

  3. Figure 11-6 Product Life Cycle/Share Development Portfolio

  4. Factors Impacting Mkt Attractiveness • Market Forces • Market size • Growth rate • Buyer power • Competitive Environment • Number of competitors • Price rivalry • Ease of entry • Market Access • Customer familiarity • Channel access • Sales requirements

  5. Competitive Position Influences • Differentiation position • Product quality • Service quality • Brand image • Cost Position • Unit cost • Transaction cost • Marketing expenses • Marketing Position • Market share • Brand awareness • Distribution

  6. Portfolio analysis • An evaluation of a business, product, or market with respect to market attractiveness and competitive position as an aid in identifying strategic plans. • Offensive portfolio strategy • Invest to grow • Improve position • New market entry • Defensive portfolio strategy • Hold/protect share position • Optimize/monetize position • Harvest/divest share position

  7. Product Life Cycle and Offensive and Defensive Strategies Figure 12-2 Market Growth and Offensive and Defensive Strategies

  8. Portfolio Analysis and Strategic Market Plans Figure 12-3 Portfolio Analysis and Strategic Market Plans

  9. Core Offensive Strategies Core Strategy 1 Core Strategy 2 Core Strategy 3 Invest to grow sales Invest to improve competitive position Invest to enter new markets Grow in Existing Markets Improve Margins Diversified Growth

  10. Offensive Core Strategy 1: Invest to Grow Sales Sub Strategy A Sub Strategy B Grow Market Share Grow Revenue Per Customer Sub Strategy C Sub Strategy D Enter New Market Segment Expand Market Demand

  11. Offensive Core Strategy 2: Invest to Improve Competitive Position Sub Strategy A Sub Strategy B Improve Customer Loyalty Improve Differentiation Advantage Sub Strategy C Sub Strategy D Lower Costs/Improve Marketing Productivity Build Marketing Advantage

  12. Offensive Core Strategy 3: Invest to Enter New Markets Sub Strategy A Sub Strategy B Enter Related New Markets Enter Unrelated New Markets Sub Strategy C Sub Strategy D Enter New Emerging Markets Develop New Markets

  13. Selecting an Offensive Strategy • Why enter new markets? • New source of growth • Smoother performance • Diversification and reduced vulnerability • Why invest to grow sales? • Why improve competitive position? • Achieve price premiums • Customer retention • Improve margins and NMC

  14. Defensive Strategies Figure 13-3 Strategic Market Plans and Performance

  15. Defensive Strategic Market Plans • What are the main objectives of defensive strategies? • When are defensive market plans employed? Figure 13-5 Portfolio Positions and Defensive Strategic Market Plans

  16. Core Defensive Strategies Core Strategy 1 Core Strategy 2 Core Strategy 3 Protect Position Optimize Position Monetize, Harvest, or Divest Maintain Sales Maximize Profits Cash Flow

  17. Defensive Core Strategy 1: Invest to Protect Position Sub Strategy A Sub Strategy B Protect Market Share Build Customer Retention • Protect position in growth markets • Protect a high-share position • Protect a follower share position • Protect a niche share position

  18. Protecting Follower Share Position Figure 13-8 Market Structure and Share Position

  19. Sub Strategy A Maximize Net Marketing Contribution Sub Strategy B Selective Market Focus Defensive Core Strategy 2: Optimize Position

  20. Defensive Core Strategy 2: Optimize Position Figure 13-14 Profit Life Cycle and Components of Marketing Profitability

  21. Defensive Core Strategy 3: Monetize, Harvest, or Divest Sub Strategy A Sub Strategy B Manage for Cash Flow Harvest-Divest for Cash Flow • Harvest Price Strategy • Harvest Marketing Resource Strategy • Divest Market Strategy

  22. Defensive Core Strategy 3: Monetize, Harvest, or Divest Figure 13-17 Harvest Price Strategy

  23. Break Time Break Time 10 minutes

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