Week 5: A light week...

This week was kind of a relaxed one from a C570 perspective, but pretty hectic in the home front, where I got to spend a lot of quality time with my family. I reviewed the Fashion Channel Case and worked out the excel spread sheet based on the details that were provided in the case. We also initiated the discussion within our team on the case, but will wait for the next breeze session to get the details and perspective from Prof. Talbott to wrap up the discussion and prepare the memo. I look forward to a great year and hope that 2013 brings cheer, peace and happiness to everyone and takes us one step closer to our dreams and aspirations! 

Week 4 – My Activities and Thoughts

Week 4 saw a lot of collaborative efforts from our teams on the marketing plan. We had inter team meetings where we discussed the marketing plan deliverable. In the beginning, it was not very clear as to how all this will fall in place. But as we started to see drafts of the plan being formed, the direction seemed to get less foggier. I definitely see value in these team activities where we get to see and discuss the different perspectives and come to a consensus, as opposed to us just jotting down our single point of view from the limited research that can be done with the limited time. It was also interesting to see multiple folks in different teams coming up with the same researches and links – this was also reassuring in that we were all headed in similar directions, which I hope is positive, given that most of us do not have a marketing back ground. J

I also read the article on Market Segmentation, Targeting and Positioning – This helps to validate the struggle I experienced as I tried to put my thoughts together on the marketing plan. As Prof. Talbott pointed out in one of the articles that was shared,  “today's firms are awash in data but short on insights”. With internet and all other media around us, there is so much data that it makes you dizzy. Some of the data  from multiple research firms is even contradictory, as we discover in our own research. Also, in today’s world of extreme global competition, it is extremely difficult to find that key differentiator that sets you and your products or services apart in the market. Many companies attempt to differentiate themselves in a crowded market place and this in turn results in an intense price war that results in many businesses going bankrupt as they cannot sustain the model.

In the wireless telecom industry, price wars are not uncommon. A few years back Sprint was struggling to find that key differentiator and Dan Hesse the CEO introduced the ‘Simple Everything’ wireless plan that was a saving grace and key differentiator for Sprint. Details can be found in this article – http://newsroom.sprint.com/article_display.cfm?article_id=614, an excerpt of which is pasted below:

The move to unlimited pricing that includes data signifies a turning point for the wireless industry. Nationally accepted measures of voice quality now show very little, if any, difference among the top wireless providers.

"All major carriers have good voice networks," Hesse said. "Our network is about more than voice and more than just being the largest wireless data network. It is about allowing customers to connect with people, information and entertainment. It is about simplicity, usability and real value. The $99.99 Simply Everything plan eliminates overage surprises and provides a worry-free environment.

"Our investments in innovation and speed are becoming the new areas of differentiation. These are the areas where we perform best and where we can deliver a wireless advantage for our customers."

Market Segmentation, Target Market Selection & Positioning – My Takeaways

1)    Market Segmentation: Dividing market into groups of potential customers called market segments

2)    Two types of segmentation:

a.    Segmentation based on benefits sought by customers

b.    Segmentation based on observable characteristics of customers

3)    Target Market Selection: Evaluation of each market segment’s attractiveness and selection of one or more segments to enter

4)    Key to target market selection is understanding differentiation – This involves:

a.    Collecting and comparing data on the company and each of its competitors

b.    Synthesizing collected data into competitor capability matrices

                                               i.    Items of evaluation are listed as rows

                                              ii.    The company and its competitors are listed as columns

                                             iii.    Each entry is a rating corresponding to the item being evaluated

c.    Evaluating and determining which of the identified segments is most likely to succeed

5)    Positioning: Identification of a clear, distinctive and unique selling proposition for the product

6)    Differentiation: Clearly articulating to the customer as to the benefits that the product fulfills – clearly stating how it differs from the competitor offerings

a.    Vertical Differentiation – Differentiation based on quality – exploits customer’s willingness to pay for quality

b.    Horizontal Differentiation – Differentiation not based on the judgment of quality levels

c.    Differentiation can be achieved via any element of marketing mix – Product, Price, Place or Promotion

Week3: Videos And Articles - My Thoughts

  The video by Hans Rosling clearly shows how quickly the world is evolving and thereby how quickly the market is changing. His message emphasizes the rapid change happening in the world, the significance of statistics and the pre-conceived ideas that people try to stick to, without doing research and leveraging the available statistical details. We often say “a picture is worth a thousand words” – the visual representation of the ideas being conveyed not only helps in getting the point across easily, but also sticks with us for longer. I can very clearly relate to his view that we need to leverage the research data available, be able to find a means to dip into all the data that is already available in the numerous databases around the world, as we really don’t want to reinvent the wheel. Better quality of data we have at our disposal, better the outcome of our research. We can start via Secondary research and based on the preliminary findings from this, start the primary research and focus more specifically on segments and criteria of interest to us.

  Malcom Gladwell’s talk clearly states the point on market segmentation very clearly  - “they were looking for the perfect Pepsi, and they should have been looking for the perfect Pepsis”. Most often we look for that single answer and it was humorous, but also real when Malcom talked about the expectation to get a bell curve back. When the collected data does not match, it is often considered a data error. But today the customers have so many options, that they can choose to be picky and thereby the need for segmentation arises. We thereby need to concentrate on those segments where we can provide the best value and benefit the most from.

  The example of Nike given in the text also clearly illustrated the segmentation principle that Prof. Talbott showed in his lecture via the Tide example. Nike, even though are in the shoes business, embedded the digital chip into their shoes and integrated it with iPOD. By thinking outside the box and integrating with the growing fitness industry, they are expanding their market based on consumer interests/needs and probably added a new segment. They might cannibalize a bit of their current customers from one of their existing segments into the new segment, but overall they will attract more fitness freaks and more iPOD users into their overall market.

Chapters 3 & 4: My Takeaways

Chapter 3: Understanding Markets and Customers

1)      Market analysis is crucial to understand the dynamic needs and behaviors of the consumers and business customers that you want to target

2)      Markets can be defined as:

a.    Potential Market – All customers who may be interested

b.    Available Market – Customers with sufficient income and access to the offering

c.    Qualified Available – Customers who are qualified based on several criteria like    income, age etc

d.   Target Market – Customers the company intends to target for an offer

e.   Penetrated Market - Subset of target market who are already buying the product

3)      Market analysis feeds into the SWOT analysis, thereby determining new opportunities and threats

4)      Consumer wants, needs and behaviors are affected by personal factors, cultural considerations and social factors

5)      Business customers are influenced by Organizational connections and considerations.

6)      Planning market research includes:

a.       Primary research : to address a specific marketing question or situation (includes ethnographic redearch, online and neuromarketing- understand consumer (brain) reactions to marketing activities)

b.      Secondary research: using information already collected for another purpose and is usually the starting point for research.

Chapter 4: Planning Segmentation, Targeting and Positioning

1)      Marketers are moving from mass marketing to segmented marketing

2)      Segmentation: Grouping customers within a market based on similar needs, attitudes, habits that can be addressed through marketing

3)      Niches – Smaller segments with distinct needs or benefit requirements

4)      Target Market – The segment of the market that you choose to pursue

5)      Segmentation Variables: Behavioral, Attitudinal, Demographic, Geographic, Psychographic

6)      Segment Evaluation criteria: 1) Large, profitable, fast-growing, 2) potential for competitive superiority, 3) Extent of environmental threats 4) Economic and technological factors

7)      Marketing Strategies:

a.       Concentrated Marketing – concentrates marketing activities only on the most preferred segment

b.      Differentiated Marketing – Follows separate marketing strategy for each of the different segments being targeted

c.       Undifferentiated Marketing – Target all segments with the same marketing strategies

Week 3: The Plan

  I started this week off by meeting with our extended teams. We agreed on our ways of working and look forward to working together in the coming weeks and use our collective effort and insight in coming up with a detailed marketing plan for the Tablet Computer/E-Reader. I also read through the Chapters 3 & 4 and watched the three recommended videos. I also plan to review the article that was posted by Prof. Talbott on the data for Tablet Adoption, after which I will post my take aways and thoughts on all the details I have come across/learned this week.

Analyzing the Situation

             I am looking at Sprint/Ericsson and the wireless telecom service provider industry. Considering some of the external factors in this area, this is an industry where the consumer trends and business trends are changing very rapidly. We all know that i-Phone has revolutionized the cell phone world and there is a growing shift towards smart phones. We also have many android phones that have come into the market and there is no dearth for mobile applications. This emphasizes the need for research to analyze what features the consumers are looking for and the price they are willing to pay for these. Also with the growth in social networking sites like Facebook, twitter etc the data usage on the cell phones is also on the rise, not only among the business users  but also among the younger generation. Analyzing these trends closely will help in coming up with competitive data plans. Though Apple is leading the pack with the i-phones, other firms like Samsung, HTC and LG are also fighting for the market share. Sprint continues to compete with Verizon and AT&T as it tries to build alliances with these cell phone manufacturers. Sprint had passed up on the i-Phone when approached several years back and that was one of the gravest mistakes made by the then CEO, Gary Foresee and Sprint ended up paying heavily on that decision. There is constant threat from the competition and it is a very fast paced industry that has struggled in the wake of the recession as it is also a capital intensive business. So the company definitely needs strong leadership and good vision accompanied by strong business strategy to maintain market leadership.