handout - pbm btm- l1 to l4

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SUBJECT : << PRODUCT & BRAND

MANAGEMENT >>

100 Marks Internal Assessment Total 5 Modules covered in 12 Lectures

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Biotech Sector Outlook Growth in India is primarily export-driven.

Export sales of Indian biopharmaceutical products are currently rising at an annual rate of 47%, domestic sales of Indian biopharmaceutical products have risen only 4–5% per annum

Vaccines are the largest and fastest-growing sector. Indian vaccine sales currently account for about 43% of the country's total biopharmaceutical sales, 16% for diagnostics 13% for therapeutics. Most of the growth in Indian biopharmaceuticals is because of vaccines India is one of the world's leading suppliers of vaccines for measles and other childhood vaccinations. 1

Industry growth is concentrated in a relatively small number of companies. About 30 Indian companies account for the great majority of the country's biopharmaceutical sales.

Indian companies manufacture an increasingly wide range of biopharmaceutical products. These include recombinant insulin, erythropoietin (EPO), G-CSF, recombinant hepatitis-B vaccine,

streptokinase, interferon alpha-2b, rituximab, and an anti-EGFR MAb product. 1,2

Indian biopharmaceutical R&D is increasing rapidly.

Top ranking Bio-Pharma companies in India

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Top 10 Agricultural Biotech Companies

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Pharma Sector Outlook Population is ever increasing

Disposable income increasing

People becoming more aware and concerned for Health & Well Being

Proliferation of Health insurance

NRHM

Rural push by Pharma Companies and Hospitals

Lifestyle & Chronic Diseases on the rise

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Overall Government (DBT) is pushing research and product

development

Bio-Pharma Industry Association also working on regulatory easing

Agriculture has immense scope

Clinical Research & diagnostic sector is also coming-up

Long-term Career prospects are Very Good

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Course & Lecture Outline

The course contents are developed with special emphasis on Pharmaceutical & Biotech Industry

Course & Lecture Outline Module 1: Frame work of Product

Management & Marketing

Organization

Lecture 1:

Introduction to Product Management

Lecture 2: Role and Operation of Product Management in

Marketing

Module 2: Covers Product /Customer/

Competitor and demand Analysis

Lecture 3: Competition, Competitor Analysis

Lecture 4: Category Analysis

Lecture 5: Customer Analysis

Lecture 6: Demand Analysis & Forecasting

Module 3: New Product Planning,

Development & launch

Lecture 7 & 8: New Product Development

○ Process and Role of Product Managers

Module 5: Brand, Branding and Brand

Strategies

Lecture 9 & 10: Brand vs. Product, Brand Elements

Brand Extension/Brand Relationships Spectrum

Brand Identity

Brand Equity

Brand Building Strategies

Lecture 11 & 12 Practice of Preparing new products, Product

launches, Brand Plans, Marketing Plans, Field-force interactions

Summary of the course

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Course Objectives

We focus on the following questions:

What are the characteristics of products? How can a company build and manage its

product mix and product lines? How can a company make better product &

brand decisions? How can packaging and labeling be used

as marketing tools?

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What is a Product? A product is “anything” that can be “offered” to a

market to satisfy a want or a need or desire of a customer

e.g. Cifran, Core, Dr. Lal Path lab, Sildenafil Citrate, Mobile Phone, Soap, Hotel Room, Airline Service



“Anything” that can be “Offered” (whether tangible or intangible) would be called a product, such as;

Physical Goods ○ e.g. Medicine, Cars,

Shampoos Services

○ e.g. Hospital, Diagnostic Lab Financial, , Internet

Experiences ○ e.g.Vergin Atlantic Space

Flight, Spa, Movie TheatreEvents

○ e.g. Iifa, Pravasi Bharatiya Sammelan

Persons ○ e.g. Movie Stars, Political

Leaders, Dhoni Places

○ e.g. Switzerland, Nainital Organizations

○ e.g. Girl Scouts, Political Parties, Fortis

Ideas ○ e.g. Family Planning,

Driving in Single Lanes

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Product LevelsDevelopment of a product in various levels depends on customer value perception and hierarchy of it.

Customer value hierarchy Customers will choose a product based on their

perceived value of it.

Satisfaction is the degree to which the actual use of a product matches the perceived value at the time of the purchase.

A customer is satisfied only if the actual value is the same or exceeds the perceived value


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Product Levels Customer value hierarchy Core Benefit

the fundamental need or want that consumers satisfy by consuming the product or service

Basic product a version of the product containing

only those attributes or characteristics absolutely necessary for it to function and cater to core benefit


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Product LevelsExpected Product

the set of attributes or characteristics that buyers normally expect and agree to when they purchase a product

Augmented inclusion of additional features, benefits,

attributes or related services that serve to differentiate the product from its competitors

Potential Product all the augmentations and transformations

a product might undergo in the future


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Product level: Example

Mobile Phone○ Core Benefit

Voice communication while on move or anywhere

○ Basic Product

Hand Held device, able to send & receive voice communication

○ Expected Product

Hand-set with voice & text communication abilities with ringtones, color screen, light weight, long battery life, sufficient memory, Calendar, Camera, FM Radio etc.

○ Augmented Product

Large screen, touch screen, internet, other applications, mobile map, games etc.

○ Potential Product

Hand-set with mind reading capacity, mobile working as Credit card/Debit card/Travel card/Unique identity etc.

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Class work: 30 minutesDefine Product Levels for following products

/services○ Car○ Aatta○ Bank○ Hospital○ Mouth Dissolving Tabs○ Penta vaccine

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Product Hierarchy Product need—to satisfy a need e.g. feet

protection

Product class—a family of products having similar function e.g. all shoes

Product line—a group of products with closely related functions e.g. sports shoes

Product type —products within a line having similar form e.g. basket-ball shoes

Brand—a name representing a product or line e.g. Nike

Item (Stock Keeping Unit)—a unit item e.g. one pair of Nike basket-ball shoe


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Product Classification 1. On basis of durability and tangibility

Non-Durable : The products which last only for some-time and have few uses

e.g. Crocin, Antibiotics, soap, salt

Durable: The products which last for a long time, have repeated uses

e.g. Spectrophotometer, clothing, cooking range, Mobile, Washing Machine etc.

Services : Intangibles e.g. Path lab,

Banking brokerage



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2. Consumer Goods Convenience Goods

○ Frequently used, purchased with minimum effort – bread, cooking oil, tooth paste

Shopping Goods ○ Purchased less often, comparison on

price, quality, and style – TV, Mobile Phone, Sofa

Specialty Goods ○ Purchased as desired, branded products

anti-aging cream, Pharma Ethical

Unsought Goods ○ Purchased on perceived need, can do

without – food processor, Music System, Car, Personal Jet



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FMCG

A sub-category of Consumer Goods Groceries Food Items Home CarePersonal Care/Body CareCloths


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3. Industrial GoodsCapital Goods Plant Equipment,

Computers Materials and Parts Plastics, Auto Parts

Supplies Paper, Toner InstallationsEquipment



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4. Supplies and business servicesBusiness advisory Services Market Research, Patent

Services e.g. ORG-IMSMaintenance and repair

itemsOperating suppliesMaintenance and repair

servicesInformation Services


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Product Mix

Product mix has following terminologies:

○ Width - refers to the no. of different product lines the co.

○ Length - refer to the total no. of items the Co. carries within its products lines

○ Depth - depth refer to the no. of versions, offered of each product in the line

○ Consistency - refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way.

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Product Mix

Company may have an assortment of productsThis assortment of products is known as

Product Mix○ E.g.

HUL product Assortment consists of many product Lines

- Food brands- Home care brands- Personal care brands- Water- Nutrition- Health, hygiene & beauty


http://www.hul.co.in/brands/foodbrands/?WT.GNAV=Food_brands



http://www.hul.co.in/brands/homecarebrands/?WT.GNAV=Home_care_brands

http://www.hul.co.in/brands/personalcarebrands/?WT.GNAV=Personal_care_brands

http://www.hul.co.in/brands/Water/?WT.GNAV=Water

http://www.hul.co.in/brands/nutrition/?WT.GNAV=Nutrition

http://www.hul.co.in/brands/hygieneandwelbeing/?WT.GNAV=Health,_hygiene_&_beauty

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Case Product mix – Sun Pharma

Product Mix (Assortment)

Line 5: Anti-infectives

Line 4: Gastroenterolog

y

Line 3: Optholmology

Line 2: Cardiovasculars

Line 1: CNS drugs

Length1.Anti-Depressent2. Anti-epileptics3. Alzheimer’s4. OCD

Depth1. Amexide2. Citopalm3. Cloferanil4. Fluvoxin

Form, Flavours, packaging

Consistency

Using Same Channel, Dr, Rep

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Product Mix Product-line length

Line Stretching○ Down-market Stretch: Means when the company

launches lower end versions of a product generally to capture mass market. Some of the reasons for down market stretch are as follows; The company may notice strong growth opportunities as mass

retailers attract a growing number of shoppers The company may wish to tie up lower-end competitors who might

otherwise try to move up-market The company may find that the middle market is stagnating or

declining

○ Up-market Stretch: This is a terminology used for launching higher end versions of an existing product/service so as to capture premium segment of market/customer

○ Two-Way Stretch


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What is Management?

Management is coordination of the resources of the firm to produce goods and services○ It is Marketing department which is responsible for co-

ordination

○ Within the marketing department it is product Manager who is responsible for the product.



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Marketing Organization Set-up


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1. Product-Focused Organization

Head of Co./Div

Head MfgHead FinHead HRHead

Marketing

Marketing Research

Product Management

Product Manager C

Product Manager B

Product Manager A

Support


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Product Focused OrganizationCharacteristics

○ Classic brand management structure developed by P&G in 1930s

○ Commonly used where different products use the same channels of distribution

○ Product Manager acts as a ‘Mini-CEO’ Product Manager has the ultimate responsibility for the brand

Associate Product Manager develops brand extensions or manages a small brand

Assistant Product Manager is responsible for market and share forecasting, budgeting, coordinating with production, executing promotions, and packaging


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Advantages of Product focused Marketing organization set-up Center of responsibility is clear

Clear who to turn to for information on the product

Product has an advocate with training, experience, persuasion, and communication skills

Breeding ground for senior executives



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Disadvantages of Product focused Marketing organization set-up Narrow focus on one product

Induces a centralized structure

Quest for quarterly or short-term sales and market share goals

Several salespeople representing different products calling on the same customer

Inefficient use of marketing funds to build brand name


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Examples of product focused organizationsElli-LillyP&G HULDaburIntel Maruti-Suzuki Taj HotelsORG-IMS


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Market Focused OrganizationCharacteristics

○ Marketing authority by market segment

○ Useful when there are significant differences in buyer behavior in the market segments

○ Does not give managers full responsibility for the services or products delivered


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Market-Focused Organization

Head of Co./Div

Head Mfg Head Fin Head HRHead

Marketing

Market Manager A

Market Manager 2

Market manager 3


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Advantages of Market Focused Organization set-up Focus on the customer as an asset

Easier to justify product modification or elimination

Useful when bundling different products or when consumer purchases many different products form the same company

Enhances product manager interactions due to specific knowledge in the particular segment


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Disadvantages of Market Focused Organization set-upPossible conflict with the product management

structure that may lie below

‘ Mini-CEO’ training and experience of traditional product managers may be lost

Most product management skills need to be sustained


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Examples of Market Focused Organization Cipla (and Majority of Pharma companies)HULInfosys (Vertical focused)Intel Thomas CookHimalaya Ayurvedic


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Function Focused Marketing Organization Set-upCharacteristics

○ Aligned by marketing functions

○ Product and market-focused organizations have aspect of this structure embedded in their organizations

○ A single manager is not responsible for day-to-day marketing activities of the product

○ Marketing strategies are designed and implemented through coordinated efforts


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Function-Focused Organization

Head of Co./Div

Head Mfg Head Fin Head HRHead

Marketing

Adv. Mgr Product Marketing

Market Service

Market Research

Sales Promotion


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Advantages of Function Focused Marketing Organization Set-upAdministratively simple

Useful if company has few products

The structure is logical with normal marketing activities

Functional training is easier to deliver

Managers become functional experts


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Disadvantages of Function Focused Marketing Organization Set-upProduct responsibility is shared so no one down

the line can be held accountable

Requires substantial time in cross-functional meetings

Training is limited to function

Marketing VP or head needs to do much of the planning


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Examples of function focused Marketing Organization Intel GoogleIOC (Oil Marketing)More (Mall)Hotel Leela VentureAventisApple


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Role and Operation of Product Management in Marketing

Develop a long-range and competitive strategy for the product

Preparing an annual marketing plan and sales forecast

Working with advertising and merchandising agencies to develop copy, programs and campaigns

Stimulating support of the product among the sales force and distributors

Gathering continuous intelligence on the product’s performance, customer and dealer attitudes, and new problems and opportunities

Initiating product improvements to meet changing market needs

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Critical Skills for a Product ManagerObservationAnalytical AbilityNegotiationsTeam-workCommunication

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Role & Operation of Product Management

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Marketing PlanningOne of the key responsibility of a Product

manager is to develop Marketing Plan

“Marketing Plan is a written document containing the guidelines for the business centre’s Marketing Programs and allocation over the planning period”

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Marketing Planning

Hierarchy of Planning

Corporate strategic planning

Group/Sector planning

SBU Planning

Annual Marketing Plan

Brand Plan


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Marketing Planning

Objectives of a Marketing Plan To define current situation facing the product

To define problems & opportunies facing the product/Business

To establish Objectives

To define “Strategies & Actions/Programmes” necessary to achieve product objectives

To Estimate & project “Financials of the product”


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Marketing Planning

Marketing Planning “Process & Sequence”Update Historical data

Collect current situation data Analyse data

Develop Objectives, Strategies & ProgrammesDevelop Financial plan (P&L)

Negotiate final Plan Implement & Measure Progress

Audit


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Marketing Planning Marketing plan Contents (Summary)

Executive summary Situation Analysis

○ Category/Competitor definition

○ Category Analysis

○ Company & Competitor Analysis

○ Customer Analysis

○ Planning Assumptions

Objectives (Sales, M.S. Growth, Profitability, volumes, any other)

Product/Brand Strategy Supporting Marketing Programs Financial Documents Monitoring & control Mechanism Contigency Plans

refer to Product Management by

Lehmann, p. 45-48


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Reference Books

Product Management – Lehmann

Strategic Brand Management – David Aaker

Strategic Brand Management – Noel Kapferer

Building Strong Brands – Keller

Marketing Management - Kotler


Module 1: Frame work of Product Management & Marketing Organization

Lecture 1:



Module 2: This Modules covers Product Analysis

Lecture 2:

Product Analysis:○ w.r.t. Competition, Competitor Analysis, Category Analysis

Lecture 3:

Product Analysis Contd….

○ Customer/Demand

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Lecture Objectives

Understand how to define competition Determining & selecting competition How to Analyze Category with various

parameters Learn to Assess Market Attractiveness Analyze Competitor(s)

Data Collection/AnalysisWhat and how to analyze

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Defining the Competitive set

Define Competition Set

Bases of Competition○ Customer oriented

Who are theyWhen they useWhy they use (what benefit sought)

○ Marketing OrientedAdvertisement/Promotion/Channel/Media/Price

○ Resource OrientedRaw material, Shelf-Space, employees, Financial

resources

○ Geographic

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aabc


Levels of Competition:○ Product form○ Product Category○ Generic ○ Budget

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Determine Competitors Set1. Managerial Judgement:

- Experience , Internal Sources, Traders, KOLs

2. Customer Based MeasuresBehavioural data

- Primary source – Deptt. Stores, A.C. Nielsen, Scanned data, IMS, C-Marc

- Brand-Switch MatrixCustomer Judgement

- Surveys – Focus Groups, Exploratory

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Using Customer JudgmentsProduct Deletion – in a group that are

substitutes for each other, if one is deleted or not available, which one would the customer select from the choice set or the rest

Substitution in Use – judged similarities in usage context, use and substitutes are indicated for the target product

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Using Customer Judgments (Models)Perceptual Mapping

○ Judged Overall Similarity – for a pair of products

○ Similarity within Consideration Set –

large set of products divided into groups in which each is a substitute for another

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Perceptual Map

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Marketing Planning Marketing plan Contents (Summary)

Executive summary

Situation Analysis○ Competitor definition○ Category Analysis○ Competitor Analysis○ Customer Analysis○ Planning Assumptions

Objectives (Sales, M.S. Growth, Profitability, volumes, any other)

Product/Brand Strategy Supporting Marketing Programs Financial Documents Monitoring & control Mechanism Contnigency Plans

REPEAT




Lecture 1:




Lecture 2:

Product Analysis:○ w.r.t. Competition,, Category Analysis, Competitor Analysis

Lecture 3:


○ Customer/Demand

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Category Attractiveness Analysis

Aggregate Category Factors Category Factors Environmental Factors

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1. Aggregate Category Factors

Remarks Mkt. Attractiveness

Category Size

Category Growth

Stage in PLC

Sales Cyclicity

Sales Seasonality

Profits

2. Category Factors

Threat of new entrants

Bargaining Powers of Suppliers

Bargaining powers of Buyers

Existing Category Rivalry

Pressure from Substitutes

Category Capacity

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Environmental Factors Remarks AttractivenessTechnological

Political

Economic

Regulatory

Social

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Aggregate Category Factors 1. Category Size

2. Category Growth

3. Stage in the PLC

4. Sales Cyclicity

5. Seasonality

6. Profits

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Aggregate Category Factors

1. Category Size For Category Attractiveness Analysis, size is an

important parameter to assess

- Measured in units and monetary value

- Will revenues support investment?

- Large markets are better

- Large categories offer more opportunities for segmentation

- Large size tends to draw competitors

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Aggregate Category Factors2. Category Growth

Current growth are important Growth projections are crucial Fast-growing support high margins and

sustain future profits Attract competitors Cause dramatic shift in market share survivability of product

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Category Attractiveness over the PLC

3. Stage in the PLC

Stage of PLC Intro Growth Maturity D’line

Category Size Small Medium Large Medium

Category Growth Low High Low -Ve

Category Attractiveness

Low High Medium/High

Low

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Category Attractiveness Vs PLC

3. Stage in the PLC ○ The introduction stage is unattractive for new

entrants

○ The growth stage is attractive

○ The maturity stage may be attractive for some categories

○ The decline is unattractive to new entrants and low market share holders may exit

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4. Sales Cyclicity ○ Due to inter-year variation in demand

○ General Economic conditions introduce peaks and valleys in sales as GDP varies

○ Swing in sales, profits, employment, cash available for new product development

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5. Seasonality ○ Intra-year cycles in sales

○ Clothes, sweets, fire-crackers, and toy sales during festivals

○ Generates price wars

○ Many products are seasonal like cold remedies, skin creams, ice cream

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6. Profits ○ Vary across products or brands in a

category, and over time

○ Inter-industry differences also exist

○ Average profit margins for footwear is about 6%, personal care 20%, and biotechnology 50%

○ Chronic low profitability is less attractive

○ Variation used as industry risk

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1. Aggregate Category Factors

Remarks Attractiveness

Category Size

Category Growth

Stage in PLC

Sales Cyclicity

Sales Seasonality

Profits

2. Category FactorsThreat of new entrates

Bargaining Powers of Suppliers

Bargaining powers of Buyers

Existing Category Rivalry

Pressure from Substitutes

Category Capacity

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Category Factors

1. Threat of New Entrants

2. Bargaining Power of Buyers

3. Bargaining Power of Suppliers

4. Amount of Intra-category Rivalry

5. Threat of Substitute Products or Services ○ Category Capacity

Five Forces Determining Segment Structural Attractiveness

- M. Porter1. Threat of New Entrants 2. Bargaining Power of Buyers 3. Bargaining Power of

Suppliers 4. Amount of Intra-category

Rivalry 5. Threat of Substitute

Products or Services ○ Category Capacity

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Category Factors

1. Threat of New Entrants ○ If high, attractiveness diminishes ○ In early stages of market development it can

help a market to expand ○ Usually it heightens competitiveness and

reduces profit margins ○ Offset by setting up barriers to entry

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Category Factors Potential Barriers to Entry

○ Economies of Scale ○ Product Differentiation ○ Capital Requirements ○ Switching Costs ○ Distribution

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Category Factors 2. Bargaining Power of Buyers

○ Distributors, original equipment manufacturers (OEMs) or end users

○ High if – product bought is a large % of buyer’s cost, product is undifferentiated, buyers earn low profits, buyer can backward integrate, buyer has full information, when substitutes exist

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Category Factors 3. Bargaining Power of Suppliers

○ Is a mirror image of buyer power

○ High if – suppliers are concentrated, no substitutes, differentiated product, built in switching costs, supply is limited

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Category Factors 4. Threat of Substitute Products or

Services

○ Large number is less attractive ○ Threat from generics ○ Threat generally in all categories ○ High rates of returns when few

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Category Factors 5. Amount of Intra-category Rivalry

○ Intense category competition is not attractive ○ Escalates marketing expenditures, price, ○ employee switch ○ High if – many or balanced competitors, slow

growth, high fixed costs, lack of differentiation, personal rivalry

○ Difficult for a product manager to have an impact on category rivalry

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Category Factors Category Capacity

○ Chronic overcapacity is not a positive sign for long-term profitability

○ Operating at capacity – costs stay low, supplier bargaining power high

○ Indicates health of category ○ Recession may lead to overcapacity

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Environmental Factors Remarks Attractiveness

Technological

Political

Economic

Regulatory

Social

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Environmental Factors Technological Political Economic Regulatory Social

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Environmental Factors Technology

○ If weak – vulnerable to new product and global competition

○ If well positioned – firm can take advantage of change

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Environmental Factors Political

○ Affects products with global sales ○ Product manager must assess political risk ○ Free market – affected by political party in

power

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Environmental Factors Economic

○ Interest rate fluctuations – short-term financing

○ Currency exchange rates – global markets ○ Employment conditions – availability of

skilled labor ○ Recession – sales, GDP growth declines ○ Inflation rates – consumer buying power

diminishes

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Environmental Factors Regulatory

○ Restrict industry from specific media use ○ Stringent testing requirements ○ Air, water, soil pollution ○ Intervene in global competition - dumping

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Environmental Factors Social

○ Trends in demographics, lifestyles, attitudes, and personal values

○ Trends affect B2B due to derived demand ○ Young adults ○ Mature consumers ○ Children as consumers ○ Shift of power from seller to consumer



Lecture 1:




Lecture 2:

Product Analysis:○ w.r.t. Competition,, Category Analysis, Competitor Analysis

Lecture 3:


○ Customer/Demand

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Competitor Analysis Steps Data Collection Data Analysis

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Data Collection

Primary Sources of Information Primary Data

○ Investment Bankers ○ Sales Force ○ Suppliers○ Customers ○ Employees ○ Consultants

Data Collection

Secondary Sources of Information Secondary Data

○ Internal Sources ○ Newspapers ○ Annual Reports ○ Patent Filings ○ Financial Audit Filings ○ Business Press ○ Government Computer

Databases

○ Internet ○ News Releases ○ Trade Associations ○ Promotional Literature ○ Trade ○ Press ○ Consultants○ Customer

Communications

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Data Collection

Other Sources of Information Classified Ads Trade Shows Plant Tours Reverse Engineering Monitoring test Markets Hiring Senior Employees

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Competitor Analysis Model

Primary Data/ Secondary Data

Key Questions

Who are they?

What are the competing product features?

What do they want?

What is their current strategy?

Differential Competitor Advantage

Analysis Who has the competitive product advantage?

Competitor Marketing Plan

What are they going to do?

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Data Analysis Questions Who are the major competitors?

How do the competing products or services stack up against each other?

What are the objectives of the major competitor products?

What is the current strategy being employed to achieve the objectives?

Who has the competitive edge?

What are they likely to do in the future?

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Assessing Competitors’ Current Objectives

Is a critical first step in a competitor analysis for major competitor products

Gives valuable information on intended aggressiveness of the competitors in the future

Helps to assess the capabilities of the competitors

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Determine the Objectives Growth Objective – increase unit sales

or market share

Hold Objective – brand losing market share, stop the slide

Harvest Objective – profit is paramount relative to market share

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Determining the Objectives Growth Objective

○ Improve market share at the expense of short-term profits The following will occur:

- A cut in price - Increase in advertising expenditures - Increase in promotions to consumers and

distributors - Increase in distribution expenses

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Harvest Objective ○ Focus on profitability – brand marketed

in the opposite way The following will occur:

- Increase in price - Decrease in marketing budgets

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Assessing the Competitors’ Current Strategies The important second step in competitor

analysis is to determine how competitors are attempting to achieve their objectives

○ Marketing Strategy ○ Differential Advantage Analysis ○ Competitor’s Will

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Marketing Strategy Three Major Components:

1. Target Market Selection

2. Core Strategy - Positioning, Differentiating

3. Implementation - Supporting Marketing Mix

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3. Implementation (Supporting Marketing Mix )

○ Marketing Mix (The mix provides insight into the basic strategy of the competitor and special tactical decisions)

4P’s - Product (Physical product or service and how it is

sold)

- Price - Promotion (Which type and how often)

- Place (Which channels are being emphasized?)

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Tracking Competitors’ Strategies Industrial Products

○ Product sales literature ○ The company’s own sales force ○ Trade advertising

Consumer Products ○ Tracking Ads

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Comparing Value Chains

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Technology Strategy Framework of Six Criteria

○ Technology Specialization ○ Level of Competence ○ Sources of Capability – Internal/External ○ R&D Investment Level ○ Competitive Timing – Initiate/Respond ○ R&D Organization and Policies

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Competitive Product Analysis Matrix Handout Grid 2

Differential Advantage Analysis – Capabilities Matrix Hand out Grid 3

Differential Advantage Analysis – Success Matrix Handout Grid 3A

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Assessing A Competitor’s Will A strong competitor can be overcome A weak competitor can cause damage Assess:

○ How crucial is this product to the firm? ○ How visible is the commitment to the

market? ○ How aggressive are the managers?

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Predicting Future Strategies Competitor signals with an

announcement Use historical information to forecast:

○ Competitor’s Strategy – dependent variable ○ Capabilities and Resource – independent

variable ○ Extrapolate that the trend may continue ○ Link Capabilities/Resources with Strategy ○ Simulate by Role-Play