Marketing for Lawyers Marketing strategies Eva Tomášková eva.tomaskova@law.muni.cz Market power lA firm with market power has the ability to individually affect either the total quantity or the prevailing price in the market. l lMany countries have anti-trust or other legislation intended to limit the ability of firms to accrue market power. l lSuch legislation often regulates mergers and sometimes introduces a judicial power to compel divestiture. l lA firm usually has market power by virtue of controlling a large portion of the market. l lIndicators of market power: lMarket share (This is the percentage of the total market serviced by a firm or a brand) lBarriers to entry (predatory pricing, product typing, creation of overcapacity) Decision of customers lMarket share of a company is an important decision for customers. l l“Is the company I am buying from stable?” l lDo you prefer buying at smaller companies or at bigger companies? Why? l Position of the market lInformation about increasing of market is necessary for analysis of position on the market. l lBCG matrix lMarket attractiveness BCG Matrix I. la portfolio planning model of the Boston Consulting Group in the early 1970's. l lIt is based on the observation that a company's business units can be classified into four categories based on combinations of: lmarket growth and lmarket share l relative to the largest competitor l lmaps the business unit positions within these two important determinants of profitability. l BCG Matrix II. BCG Growth Share Matrix Categories of BCG Matrix lDogs lhas little potential lsuch businesses are candidates for divestiture lQuestion marks l(known as a "problem child") has the potential to gain market share and become a star lif they does not succeed, they will degenerate into a dog lmust be analyzed carefully in order to determine whether they are worth the investment required to grow market share lStars lgenerate large amounts of cash lit will become a cash cow when the market growth rate declines lthe portfolio of a diversified company always should have stars that will become the next cash cows and ensure future cash generation lCash cows las leaders in a mature market lgenerate more cash than they consume lcash cows provide the cash required to turn question marks into market leaders Example lDogs – floppy disk lQuestion marks – USB 3.0 lStars - USB flash drive – USB 1.0 or USB 2.0 lCash cows – Compact disk (CD), Digital Video Disc (DVD) l l Market attractiveness (GE matrix) lthe McKinsey and Company Consulting group l lIncludes: lMarket attractiveness - market growth as the dimension of industry attractiveness, lCompetitive strength - market share as the dimension by which the competitive position of each company is assessed. l lFactors that Affect Market Attractiveness l - Market Size - Market growth - Market profitability - Pricing trends - Competitive intensity - Overall risk of returns in the industry - Opportunity to differentiate products and services - Segmentation - Distribution structure (e.g. retail, direct, wholesale) l lFactors that Affect Competitive Strength l - Strength of assets and competencies - Relative brand strength - Market share - Customer loyalty - Relative cost position (cost structure compared with competitors) - Distribution strength - Record of technological or other innovation - Access to financial and other investment resources Market attractiveness (GE matrix) High Market Attractiveness Market Share High Medium Low Medium Low Invest or go away Invest Keep the leader position Cash and go to disinvestment strategy Cross Increase of market attractiveness Disinvestment strategy Cash and go to disinvestment strategy Cash Limitation of BCG and GE Matrix lBCG matrix overlooks many other factors of profitability l lThe framework assumes that each businessman is independent of the others. l lThe matrix depends heavily upon the breadth of the definition of the market. A businessman may dominate its small niche, but have very low market share in the overall industry. In such a case, the definition of the market can make the difference between a dog and a cash cow. l l l BCG matrix still can serve as a simple tool for viewing a corporation's business portfolio (a range of property investments) Brand Positioning lemotional branding can also be extremely powerful l lBrand managing: lfrom Diagnostics (defining the field of play) lCreation (defining the brand architecture) lRealization (giving meaning to the brand) lMonitoring (if brand fulfills expectation of firms) https://cdn-images-1.medium.com/max/2000/0*znyzcl9AgrfIs_qv.jpg Brand Positioning The 101 of Brand Positioning https://outsidetheboxgraphics.com/category/wordpress-development/ The most valuable brands https://ei.marketwatch.com/Multimedia/2017/02/08/Photos/MG/MW-FF462_MostVa_20170208173448_MG.jpg?uu id=cc50ace8-ee4e-11e6-98f0-001cc448aede https://www.marketwatch.com/story/the-most-valuable-brands-in-the-world-in-one-chart-2017-02-08 The most valuable brands https://ei.marketwatch.com/Multimedia/2017/02/09/Photos/NS/MW-FF536_top10b_20170209104502_NS.png?uu id=b8a6b15c-eede-11e6-9f72-001cc448aede https://www.marketwatch.com/story/the-most-valuable-brands-in-the-world-in-one-chart-2017-02-08 Position analysis lPsychological model lBased on brand perception by customers l lMain presumption: lTo have differences recognizable by customers lCustomers have to place product of a company and products of competitors to the graph lTo know the best position for customers lTo measure differences between ideal position of customers and current position l l+ Clear perception and wishes of customers l- To realize a large research Brand Positioning Example lhttps://xposurecreative.uk/brand-positioning-example/?cli_action=1543826899.638 brand positioning graph Creation of position graph Price Design Individuality Technology Comfort Elementary transport Safety Environment People who searching the lowest prices People who like prestige People who like speeding Udělej si sám Critisc of impact on environment Car = transport People who like technology People who prefer safety People who like comfort People who like design Prestige Position analysis I. Price Design Individuality Prestige Comfort Technology Elementary transport Safety Environment People who searching the lowest prices People who like prestige People who like speeding Udělej si sám Critisc of impact on environment Car = transport People who like comfort People who prefer safety People who like technology People who like design FIAT HONDA OPEL SEAT PEUGEOT FORD MERCEDES VW NISSAN MAZDA ŠKODA AUDI BMW Brand Positioning Example perceptual map for auto industry https://lucythebusybee.wordpress.com/2013/10/24/applying-the-perceptual-mapping-concept-into-brand- positioning/ Brand Positioning Example positioning map SL https://yslculc.wordpress.com/2015/08/09/target-customers-advertising-analysis-brand-architecture-b rand-position/ Brand Positioning Example https://lucythebusybee.files.wordpress.com/2013/10/11111.jpg https://lucythebusybee.wordpress.com/2013/10/24/applying-the-perceptual-mapping-concept-into-brand- positioning/ Position analysis II. Price high low Specialization rate low high ORGANICS PANTENE EL. VITAL GLISS KUR SCHAUMA TIMOTEI NIVEA GUHL SANDRA ULTRA BEAUTY SCHAMTU GARD Brand I. Brand II. Brand III. SWOT Výsledek obrázku pro swot analysis Strategy lStrategy refers to a plan of action designed to achieve a particular goal. l lA goal is a projected state of affairs that a person or a system plans or intends to achieve l lGoals should be SMART lS – specific lM – measurable lA – attainable lR – relevant (realistic) lT – time-bound l lDetermine 3 goals (could be from your personal life) which are SMART. l Marketing strategy lMarketing strategy is a process that can allow a company to concentrate its limited resources on: l the greatest opportunities to increase sales and lachieve a sustainable competitive advantage (requires erecting barriers against the competition). l lThe main goal of marketing strategy is customers satisfaction. Types of strategies lStrategies based on market dominance lPorter generic strategies lInnovation strategies lGrowth strategies Strategies based on market dominance Marketing warfare strategies lA company must identify its position relative to the competition in the market l lTypically there are four types of market dominance strategies: lLeader lhas market dominance lChallenger lThe market challengers’ strategic objective is to gain market share and to become the leader eventually lHow? lBy attacking the market leader lBy attacking other firms of the same size lBy attacking smaller firms lFollower lproduct imitation strategy might be just as profitable as a product innovation strategy l e.g. Product innovation—Sony, Product-imitation--Panasonic lNicher lSmaller firms can avoid larger firms by targeting smaller markets or niches that are of little or no interest to the larger firms l l Porter generic strategies lProduct differentiation lCost leadership Innovation strategies ldeals with the firm's rate of the new product development and innovations l lPioneers lconcentrate on being the one with the newest, hottest products around. lA company promises its customers will get the new technology before anyone else does. l lClose followers lwait for other to pioneer in different direction, and when they are on to something, a company quickly adopts it, improves it and makes it its own. l lLate followers lA company adopts only the most stable of technology, it stresses to its customers that its products will be stable, tried and tested, with no bugs or last minute recalls. l Growth strategies lPossibilities how a company should grow l lHorizontal integration lA company tryes to expand by acquiring or starting new business in the same field as its main business lit allows to control a bigger market share lVertical integration lA company tryes to acquire or start businesses that supply its current business or sell its products. lit allows to have a stable production and delivery structure l lDiversification lA company tryes to get new markets with new products, where are great profits there l lIntensification lA company adds new features to its existing products (new versions of products) lit allows to expand its market position