high marketing general

Ismi Rajiani PhD Management ScienceMBA International Business Management

Strategic High Technology Marketing

Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -* The last thing IBM needs right now is a vision. (July 1993)Vision What IBM needs most right now is a vision. (March 1996) Louis V. Gerstner, Jr., CEO, IBM Corporation


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -* What do we want to become?

Vision


Reasons for having a vision statement

Gets team focused.Shows a picture of where the company is going.Instills focus, discipline, and structure within the organization. Ensures that team understands company direction.


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Answers the question:What is our business?

Reveals:what the organization wants to bewhom we want to serveMission Statement


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*An enduring statement of purpose that distinguishes one organization from other similar enterprisesA declaration of an organizations reason for beingMission Statement


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Mission Statements are also called

Creed statementStatement of purposeStatement of philosophyStatement of beliefsStatement of business principlesA statement defining our business


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Vision & MissionGreat benefits can be achieved if an organizationSystematically revisits their vision and mission statementTreats them as living documentsConsiders them to be an integral part of the firms culture


The Difference between Vision & Mission

Vision -The FutureDefinition: The way in which one sees or conceives something; a mental image; An overall statement of the goal of the organization.Vision should describe what will be achieved in the wider sphere if the organization and others are successful in achieving their individual missions.Mission -The PresentDefinition: An assignment one is sent to carry out; a self-imposed duty. A mission statement identifies the reason for the existence of the organization. The statement should be linked to the overall operations and business of the organizationA Mission statement is more specific to what the enterprise can achieve itself.


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -* Mission ComponentsCustomersMarketsEmployeesPublicImageSelf-ConceptPhilosophySurvival,Growth,ProfitsProducts or ServicesTechnology


ReviewWhat is strategy?What are the Strategic Implications of High Technology?


Mission of Ford Our mission: we are a global, diverse family with a proud inheritance, providing exceptional products and services.

Vision of FordOur vision: become the main company of the world in products and services of the car.


What is relationship between Vision, Mission and Strategy?


Objective indicates how well the result of strategyStrategy determine how to achieve Vision and Mission


Vision StatementTo be the largest low cost airline in Asia and serving the 3 billion people who are currently underserved with poor connectivity and high fares.

Mission Statement To be the best company to work for whereby employees are treated as part of a big family. Create a globally recognized ASEAN brand. To attain the lowest cost so that everyone can fly with Air Asia. Maintain the highest quality product, embracing technology to reduce cost and enhance service levels.


Key Strategies Safety FirstHigh Aircraft UtilizationLow Fare, No FrillsStreamline OperationsLean Distribution SystemPoint to Point Network


In terms of the three key players (competitors, customers, company) strategy is defined as the way in which a corporation endeavors to differentiate itself positively from its competitors, using its relative corporate strengths to better satisfy customer needs.

-Kenichi OhmaeThe Mind of the Strategist

Strategy in Brief!


Strategy LEVEL!


Figure 1.1 The impact of technology on marketing


Challenges for StrategyNew designs must win market shareRole of distribution channelCustomer perceptionsCompetitionFrom higher performance to lower costs and differentiation through minor design variations and strategic positioning tacticsincremental changes take placeSegmenting - Targeting - Positioning


Key IssuesWhy so many excellent products fail?90-95 % of new product ideas newer reach market30-50 % of introduced products seem to fail on the marketAre there differences between high-tech and low-tech product concerning the commercialisation process?Critical issue: Time-to-MarketUsing the Market Development Model


Technology Adoption Life-CyclePragmatists create the dynamics of high-tech market development.Source: Moore (1998)


Innovators - Technology EnthusiastsPrimary Motivation:Learn about new technologies for their own sakeKey Characteristics:Strong aptitude for technical informationLike to alpha test new productsCan ignore the missing elementsDo whatever they can to helpChallenges:Want unrestricted access to top technical peopleWant no-profit pricing (preferably free)


Early Adopters - The VisionariesPrimary Motivation: Gain dramatic competitive advantage via revolutionary breakthroughKey Characteristics:Great imaginations for strategic applicationsAttracted by high-risk, high-reward propositionsWill commit to supply the missing elementsPerceive order-of-magnitude gains so not price-sensitiveChallenges:Want rapid time-to-marketDemand high degree of customization and support


Early Majority - PragmatistsPrimary Motivation:Gain productivity improvements via evolutionary changeKey Characteristics:Astute managers of mission-critical applicationsUnderstand real-world issues and tradeoffsFocus on proven applicationsLike to go with the market leaderChallenges:Insist on good references from trusted colleaguesWant to see the solution in production at the reference site


Late Majority - ConservativesPrimary Motivation:Just stay even with the competition.Key Characteristics:Better with people than technologyRisk averse Price-sensitive Highly reliant on a single, trusted advisorChallenges:Need completely pre-assembled solutionsWould benefit from value-added services but do not want to pay for them


Laggards - SkepticsPrimary Motivation:Maintain status quo.Key Characteristics:Good at debunking marketing hypeDisbelieve productivity-improvement argumentsBelieve in the law of unintended consequencesSeek to block purchases of new technologyChallenges:Not a customerCan be formidable opposition to early adoption


Discovering the ChasmHigh-tech products are warmly welcome in an early market (techies & visionaries) but then will fall into a chasm (sales will falter and often plummet)Visionaries dont see enough of a head startPragmatists see no reason to start yetCrossing the chasm gaining the acceptance within a mainstream market - becomes and organisational imperative but very few high-tech products cross these chasmsSource: Moore (1998)


Crossing the ChasmProduct vendors problem80% of many solutions100% of nonePragmatists won't buy 80% solutionsMost common vendor mistake:Committing to the most common enhancement requestsNever finishing any one customer's wish-listSolutionFocus on a single beachheadAccelerate formation of that segment's whole productSource: Moore (1998)


Successful CrossingConsidering the difference between visionaries and pragmatiststhe former is willing to bet on the comethe latter want to see the solutions in production (i.e. see the whole product before they by it) Many high-tech companies are not willing to commit to develop any whole productthey focus on four to five likely candidate segmentsrisk for having everything for nobodyPutting all eggs in one basket is the only safe way to cross the chasm - Why? (Focus & Globalisation)


Market Development ModelBowling AlleyChasmTornadoTotalAssimilationMain StreetEarly MarketMainstream MarketSource: Moore (1998)


Beyond the Chasm - Assessing Mass MarketThe Bowling Alleya period of niche-based adoption in advance of the general marketplace, driven by compelling customer needs and the willingness of vendors to craft niche-specific whole productsThe Tornadoa period of mass-market adoption, when the general marketplace switches over to the new infrastructure paradigmMain Streeta period of aftermarket development, when the base infrastructure has been deployed and the goal now is to flesh out its potentialEnd of Lifewholly new paradigms (technology) come to market


Technology vs. Category Life CyclesTechnology Adoption Life Cycle(First time adopters)Source: Moore (1998)

Market Platform Plan (MPP)MPP integrates knowledge about the market and knowledge about the product and its defining technologySource: McGrath (2000)


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Mission Statements are also called

Creed statementStatement of purposeStatement of philosophyStatement of beliefsStatement of business principlesA statement defining our business


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Steps to Developing Vision & Mission StatementsHave managers read related articlesHave managers prepare a vision and mission statement for the organizationMerge the documents into one and distributeGather feedback from managersMeet to revise the final document


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Benefits of Mission StatementsBetter financial resultsUnanimity of purposeResource allocationEstablishment of cultureFocal point for individualsEstablishment of work structureBasis of assessment and controlResolution of divergent views


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Resolution of Divergent ViewsA genuine decision must be based on divergent views to have a chance to be a right and effective decision

Considerable disagreement over vision and mission statements can cause trouble if not resolved


Copyright 2011 Pearson Education, Inc. Publishing as Prentice HallCh 2 -*Vision & Mission StatementsProvide unity of directionPromote shared expectationsConsolidate valuesProject a sense of worth and intentAffirm the companys commitment to responsible action


CONCLUSIONSWhat have we learned?


Current Wisdom on High-Tech Strategic ManagementInteraction between marketing and R&DCoping with the high levels of technological and market uncertaintyMarketing capabilities & business competenciesProduct development processesRapid changes in technology and market settingsShortening the breakthrough-timeMarket offering and product platform approachesIncreasing importance of services Emphasise technical support and after sales serviceDifferentiating from competitorsBuilding strong relationships with suppliers, channels and customersAnalysing value systems Networks, strategic alliances, partnershipsRely on qualitative rather than quantitative approaches for market researchWhat the customers really value?


What does this mean?The High-Tech label is not once and for all, so todays hot new technologies becomes tomorrows basic technology Surprisingly, high-tech strategic management is not so different from that of low-tech as often claimed but there is a special need for more focus in high-tech context because ...Customers view is easily overlookedTo avoid developing a product which are engineer's dilemma but marketers nightmareKnowing competitors well enoughGlobal view of high-tech businessCross-industry effects and convergence of different technologiesFocusing more and more on services determined by VISION and MISSION


AssignmentBased on what you learn today, now please analyze what is wrong with Nokia so it is collapsed? Relate it to vision and mission?


High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing *Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing Strategic Market Management 7th Edition David AakerArto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*6Fundamentally committed to new techThey love to get their hands on the latest and greatest innovationAll organisations support techiesFrom marketing point of view they usually do not have the moneythey are gatekeepers to the rest of life cycleinnovations get hearing with their endorsementnew products are given to them to gain their supportArto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*7Are the true revolutionaries in businessgovernment who want to use the innovation to make a brake with the past and start an entirely new futureBeing first to exploit the new capabilityto achieve competitive advantageExtraordinary influence on high-tech marketingare the first constituency who can and will bring real money to the tablehelp publicise the new innovation, butEach visionary require special modifications that no one else would useovertax R&D resourcesneed to find customers for standard solutions

Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*8Make the bulk of all technology infrastructure phasesdo not love technology of its own sakebelieve on evolution not revolutionInterested in enhancing their systems efficiency by using new technologystrong reference base needed -- trustadopt the new innovation when time is readyPrefer to buy from market leadereveryone else in the market makes the product work with the leadersmarket leader attracts many third-party companies into its aftermarket

Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*9Pessimistic about their ability to gain any value from technology investmentsundertake them only when they must - no other alternatives or others pass them byprice-sensitive, sceptical, and very demandingHowever, they represent a large opportunity for high-tech productsneed to be handled with caresimplify and commodities systems - just work, no morethey are happy to by several dozen of the worlds most advanced microprocessors, as long as they are deeply embedded inside a BMW

Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*10Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*13Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*14Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003High Techonology Marketing High Techonology Marketing Arto Rajala / HUT 10.4.2003*Arto Rajala / HUT 10.4.2003

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