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Summary ALL READINGS SUMMARIZED Entrepreneurial Marketing 2nd semester
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All the readings you need to know for the Entrepreneurial Marketing final exam in one document.
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All readings of marketingExcept for the following articles:
Consumer behaviour and the buying process by John T. Gourville and Michael I. Norton.
Bad is stronger than good by Kathleen D. Vohs.
The power of consumer stories in digital marketing by Renée Richardson Gosline, Jeffrey Lee and
Glen Urban.
Reading 11 April
When Marketing Is Strategy by Niraj Dawar
In an industry you have upstream and downstream activities. Upstream activities (what else can we
make and sell) like sourcing, producing, logistics and innovation are being outsourced often.
Downstream activities (what else can we do for our customers) are shaping customer perception,
innovation and building accumulative advantage. These activities are less being outsourced.
The core of businesses are customers and the market at this time(downstream activities), instead of
the product and the factory (upstream activities). With this shift in focus, also the pillars of strategy
change:
- The company grows with experience and knowledge, since the sources and locus of
competitive advantage lie outside the firm and the advantage is accumulative
- The focus is on the needs of the customer and your position relative to their purchase criteria
instead of having the best product
- The pace and evolution of markets are now driven by customers’ shifting purchase criteria
rather than by improvements in products or technology. Establishing and nurturing linkages
in the marketplace creates stickiness - customers’ (or complementors’) unwillingness or
inability to switch to a competitor when it offers equivalent or better value.
Three critical decisions can determine or influence who your competitors will be:
- How you position your offering in the mind of the customer
- How you place yourself vis-à-vis your competitive set within the distribution channel
- What your pricing looks like.
In choosing how to position products, managers have tended to pay attention to the size and growth
of the market and overlook the intensity and identity of the competition.
In each case, the quality of the product innovation—the increased benefits relative to current
products—helps move the market, but it does not guarantee a shift.
The downstream tilt has particular resonance for three kinds of companies:
- Companies that operate in product-obsessed industries, such as technology and
pharmaceuticals. The possibilities of downstream value creation and the potential for
building competitive advantage in the marketplace tend to be eye-opening for such firms.
- Companies operating in maturing industries whose products are increasingly commoditized.
These firms are keen to find sources of differentiation that do not rely on easily replicated
products or production advantages.
, - Companies seeking to move up the value chain. Downstream activities provide a way to build
new forms of customer value and lasting differentiation.
Positioning Myopia: Many use the word, positioning, but few seem to see it clearly by Jack Trout
Positioning is how you differentiate yourself in the mind of your prospect. It's also a body of work on
how the mind works in the process of communications.
We are going to work out the five most important elements in the positioning process:
1. Minds are limited: you should be careful with your message and be aware of what is already
in the mind about you and your competitors.
2. Minds hate confusion: simplicity is the ultimate sophistication.
3. Minds are insecure: customers don’t know what they want or they don’t want to say it. They
are sort of like a sheep, following the herd. So why should you ask them?
4. Minds don’t change: customers are more impressed by what they already know than what by
what is new. Humans tend to reject information when it doesn’t match the information that
they already know. To change an attitude, you should change the information on which the
attitude rests and this is difficult to do with a 30-second commercial.
5. Minds can lose focus: unchecked product-line extension can weaken a brand’s image, disturb
trade relations and disguise cost increases.
In conclusion: the specialist or the well-focused competitor in an ever increasing competitive world is
usually the winner. First, the specialist can focus on one product, one benefit, one message. Second,
the specialist has the ability to be seen as the expert or the best. Lastly, the specialist can become the
‘generic’ for the category.
Pricing and Positioning for Entrepreneurial Marketers by Leonard Lodish
According to professor Leonard M. Lodish positioning and pricing are the most important
entrepreneurial marketing decisions that you can make. You have to integrate your positioning and
your segmentation with a distinctive competence. What is going to make me successful over the
long-term? What is distinctive about me that will be hard for my competitors to reproduce? There
are several key principles in positioning a product:
- Give someone a reason to buy your offering over the competition.
- What are the unique differentiating characteristics of my product or service as perceived by
members of the target segments?
- Remember that humans cannot make decisions balancing more than two to four
differentiating attributes at a time.
- Humans don’t buy features, they buy benefits. It is important to show how a feature relates
to a benefit, otherwise it doesn’t do any good.
- Don’t underestimate the value of a good name and a good slogan.
Next is pricing. Lodish recommends premium pricing, which is continually improving perceived value
to customers vs competition. The perceived value is done by reputation, design, trust, brochures,
sales forces, pricing, website etc. If your price is too low, you ruin the product right off the bat.
Concept testing is a research technique where one determines whether the potential user
understands the idea of the proposed product, reacts favourably to it and feels that it answers a
need. Concept testing is:
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