Week 4

Week 4 of the 11 week class is here or basically gone. It seems like it is flying by. I am going to try and make this blog post quick and sweet as possible as it appears I have fallen victim the summer cold. So I promised I would tell you all about PharmSim explorations. My past week didn’t really let me get to experiment too much, but I definitely plan on going overboard this weekend and next week. I did get some time in PharmSim though. I played around with all sorts of different numbers and I actually increased my stock price. So I am going to take that as I did something right. I really tried to maximize my budget as much as possible, and tried to focus on increasing money to areas that would have more reach such as giving more money towards a Walgreens type store verse a mom and pops drug store.

This week’s reading had no Drucker, much to my despair as it is always easier to talk about that book than other book. I think this is because it has so much more thought provoking concepts in it. We had to ready two chapters out of our “Analysis for Marketing” text book by Donald R. Lehmann and Russell S. Winer. The two chapters were Chapter 2 on Defining the Competitive Set, and Chapter 4 on Competitor Analysis. Something I definitely took away from Chapter 2 is that a company needs to stay open to what could be or become competition. A diet coke doesn’t just compete with another diet cola it competes with other diet sodas, other beverages, ice cream, fast food, and other products that could impact a consumer’s decision to purchase diet coke. However, a company can be overcome with who to consider is competition. So a company must compete with companies that are more direct competitors and similar form competitors. So a diet cola should take into account other diet drinks and beverages in general as well. That is pretty much the rough gist of chapter 2. I will say when thinking about who could be competitors is definitely overwhelming.

Chapter 4 was competitor analysis. Enable for a company to make a good marketing strategy the company should think about what its competitors are doing and how that may impact their marketing strategy. If a competitor is about to launch a similar product maybe the company wants to consider launching their product sooner to obtain the lead on the market. There are four things that a competitor analysis involves. These are:

1)      Assessing competitor objective

2)      Determining competitor’s current strategies

3)      Evaluating competitors capabilities

4)      Forecasting competitor’s future strategy

There lots of sub categories to each one, but the general gist is that these four things have to considered when making one’s own marketing strategy. It would be almost suicidal not too.

However when you read the article “How to Write a Competitor Analysis” by Michael Knowles he actually list five components to a competitor analysis. His five components are:

1)      The company’s competitors

2)      Competitor product summaries

3)      Competitor strengths and weaknesses

4)      The strategies used to by each competitor to achieve their objectives

5)      Market Outlook

This list is very similar to the list provided in the book. The overall theme is to KNOW YOUR COMPETITION! If a company does not know their competition how will they be able to stand out from competition with their product to win over or keep their market share? Your company will not be able to compete unless your company is mindful of this. Now competitors, depending on your business, can be from anywhere on the globe. Competitors can be right next door or they can across the globe. As technology has grown, the reach on companies to consumers has also grown. Now a small local shop could end up competing with a large company from China or England. The internet has really changed how companies compete with eachother. One way to compete, as I sort of already talked about, is that of product differentiation. Differentiation is a huge way companies can compete with their competition on similar products. Part of the reading this week talked about a party store and how they compete with cheaper stores from all over the world. However, they are able to compete because they offer more products on their online store than their in their physical store, and also to offer personalization their party decorations which is something their competition doesn’t do, or do it at a higher price point. They were able to differentiate their product, and eventually succeed. At the end of the day, the message of this week was KNOW your competition  inside and out, and figure out how compete against them by exploiting a weakness. Time to go back to bed, this sick student needs some rest.

Week 3 - So much to cover, So little time....!

So it is week three of the eleven week graduate marketing class I am taking and therefore another blog needs to be put up. We talked about all sorts of things from marketing environment, income statements, market research, market analysis, and etc. Basically the general theme of this week was there are a lot of different components to marketing than just making a pretty advertisement for a product or service.                 A marketer and company for that matter, has to really look everything from the market they are in or trying to penetrate, and their target market for their product or service. When looking at a market for a company’s product or service the company/marketer should think about their culture, values, attitudes, and beliefs. These four factors greatly affect a consumer’s behavior towards buying a product or service. To do a quick break down of these factors, culture is the behavior and beliefs of a group. Values are the basically beliefs or code of conduct for people. Attitudes are people’s manner and behaviors towards products. Beliefs are what people believe in. So if a company’s product is a green product, the company will then want to market their product to people who care about the environment and want to do their part in lessening their environmental impact.                 Ok this is great information to know, but how does a company reach consumers? Well they develop a strategy, and more specifically a Marketing Strategy. The marketing strategy is a plan that a marketing department or company develops that details how a company’s products or services will be marketed and/or present to their consumers or potential consumers. There are several external factors that impact this strategy. These are Social, Legal, Economic, Political, and Technological factors or SLEPT for short. It’s a very cute acronym that will help me, and hopefully you, remember these factors better. So let’s define these SLEPT components better. Social is the demographic information of an area. I was recently watching this bar rescue show the other day and the rescuer talked about how in the area of one bar there was 13,000 potential customers that would are in the age range of 21-34 that are single and like R&B music. It was an R&B bar that was not drawing in a crowd. Clearly there was a market for it, but the bar wasn’t bringing them in.                    Legal means the state and federal regulations on an industry or business. Such as with the bar, it can only promote itself to 21+ year olds because it is illegal to sell to minors. Economic influences circles around the state of the economy and its impact of the consumer. If the economy is doing poor, then consumers are not going to have disposable income to purchase the company’s products or services. In the case of the bar rescue, there was 13,000 potential consumers that did have the purchasing power to go the bar up to three times a week, but next to none were coming. Political influence is the “P” of SLEPT. Meaning if a company has political views that could make it appealing or not appealing to potential consumers. Think of Chick-fil-a that has been recently in the news. They are a Christian company that is not supportive of homosexuals. Because of their views, certain consumers and groups for that matter will not eat at a Chick-fil-a now since they have taken certain public political stances in regards to peoples sexual orientation. The last of the SLEPT influences is that of T or technological influences. Companies have to stay up with technological changes especially considering how fast technology has changed and is changing. This for second about your shopping experience maybe around Christmas time. Say there is a product at a store that you want to buy for that special someone, if you go to the clerk and ask them to see if it is at a neighboring  store they say they can’t look that up, how are you going to feel? I know I would feel disappointed that they do not have the technology to look this products availability up in other stores like most stores now a day's can. What would make me feel even more disappointed as a consumer is if the store I want to buy something from doesn’t even have a website that I could try and order the product from. If the company doesn’t have one or any of these options then the company isn’t staying up to date with technological advances and would eventually go out of business. Going back to the bar rescue show, one of the reasons the bar was doing so bad was that it had not stayed up to date, and its sound system was really bad which kept it from being a good bar/club site. Something that is not part of SLEPT is that of competitive influences. A company has to research and study its competitors to make sure they stay competitive. If they do not say competitive then they run the risk of falling behind to their competition. If another company is doing something to “steal” their customers, it should be looked into because maybe those customers can be “stolen” back with a few adjustments.                       So generally I talk about Drucker and his teachings with Cohen. Really this book should be the bible of marketing, but I'm sure there other books that are just as compelling. We only had to read two short chapters in Drucker this week. Some of it was the same old same old that all the research in the world can be done on a product and a market, but sometimes it is wrong. A marketer has to keep a healthy balance of using both research and intuition. If a marketer ignores their gut feelings, sometimes they miss out a major opportunity. Beside market research, Drucker also talked about how a product needs to be defined by the customer and not the marketer. This was definitely an eye opening statement, as you sort of see the relation in real life but until the statement is made you never realize that is what is happening. Kind of like looking at a fuzzy picture and you sort of see what it is and then someone says what the picture is and bam it comes into focus. Now Jen in class talked about this in her discussion question. Her question was "Drucker states that "A product or service is defined by the customer, not the marketer". I can see (especially from the examples used in the text) how this statement could certainly hold true for a product and some services. However, I'm not quite sure how the customer would define services provided in the healthcare field, since some of them are so specific to certain health conditions/disease states." Now, I totally agree with her that certain products or services lend themselves to be redefined according the customer. I mean isn't that what pinterest is all about redefining products (or just being crafty but stick with me I'm trying to make a real life tie in). I will say though to Jen that although I think it is harder for the health field, I do think it still happens, and my one example that pop's out in my mind is Viagra. It was supposed to be heart medication, and then people realized it could do some good for another area of the body. Now it is a widely sold product for men. (If you don't know what Viagra is Google it.) Also, people use certain medical creams to help with certain beauty routines. I think I had a roommate once that used hemorrhoid cream for the black bags under her eyes. Not my cup of tea, but she swore by it.                    Another thing we had to do this week was look at two classmates’ blogs and comment about them. One person's blog that I want to comment on is Brianna's. When I started reading her blog I didn't realize it was the blog submission for week 3, but I am glad it was because it was really helpful. In her blog she named another student's blog that had been helpful to her when using PharmaSim. This is a blog I will definitely be checking out. She also talked about how nervous she was to use PharmSim, which was reassuring to hear because I have been rather nervous to use PharmaSim, and have been sort of avoiding due to being so nervous. Hearing about how someone else was so nervous and was able to overcome that was reassuring.                    The classmate that Brianna found a lot of good information on PharmaSim was Randall's blog. It was definitely a very helpful blog! First of he has run the program at least twice...I have yet to move forward in the simulation. So that was very reassuring to see.  He talked about how it easy to run a company into the ground, which is good to know for when I run the simulation as the first go around I probably will. He also gave tips as to what to make sure to not lose sight of when running the simulation. One example is that of inflation, and market share. All very helpful tips as I go forward and try to overcome my hesitation of using the PharmaSim.                    So now that I am about to embark on really diving into PharmaSim, if nothing else to figure out what we need to for this blog which is…add up how much all the reports will cost if you are to purchase them all. Which since I am so inexperienced in this world of marketing I will have to heavily depend on. So I am of course in period 1 because I am so nervous to go beyond that. But after I do this requirement I will most likely start playing with it and be much further along next week which I will then talk about. So I copy and pasted the report purchases for period 1 here:                                              Report Purchases - Period 1                                                      Market Research Purchases Report Cost   Purchase Survey $ $100,000 Operating Statistics $ $45,000 Sales Force $ $20,000 Advertising $ $35,000 Promotion $ $35,000 Channel Sales $ $25,000 Pricing $ $20,000 Shopping Habits $ $15,000 Shelf Space $ $25,000 Recommendations $ $20,000 Conjoint Analysis $ $100,000 There is a much better way to show this then this simple copy and paste, but for the sake of time, as I have writing this blog by bits and pieces every day, this is the best way I know how until I can experiment with that as well. So all the reports together cost $440,000 (I did the math twice so it should be right). Considering my budget is over 34 million, this $440,000 is relatively small. It is somewhere around 1.29% of my budget. This is a no brainer to purchase all this information. It is less than 2% of your budget that could help make the product even more successful. Pretty small investment that could end up having huge results. Well this is it for this week’s blog post.

Week 2 Blog Post

This week we continued our reading of Drucker on Marketing by William A. Cohen. This book is perhaps one the best academic required books I have read outside of an English class. This book is good so far I really wish our department, that is a marketing department, would read it and learn from it. Everyone would really benefit this book, and it certainty has more to offer than the book we had to read last summer about humans and how we need to embrace our inner animal instincts… it was as bad as it sounds.

                So why am I slightly cult-ishy in love with this book so far when it has only been five chapters. Well besides all the “Oh my God this is my Life” moments that this book produced last week and this week, there is also this amazing list that was composed this week on the principles of leaders. The list is on page 41 and the list is

1.       Maintain absolute integrity

2.       Know your stuff

3.       Declare your expectations

4.       Show uncommon commitment

5.       Expect positive results

6.       Take care of your people

7.       Put duty before self

8.       Get out in front

The one principle that a leader can absolutely NOT violate is that of integrity. This I absolutely agree with. I can look at this list and think of leaders who I have admired and although some may have been missing a few of these principles, but they all had integrity. So then I decided to think about a list of leaders who have been for the lack of a better term “bad” leaders, and they all seemed to violate at least two principles and the principle that was violated in all of them was that of integrity. I even thought about leaders that I had admired and eventually ended up considering them less than satisfactory and the moment they made the switch in my book was when they no longer maintained integrity. My current “big boss” is good academic example of this list. This leader was someone that many of us would of followed without hesitation or questioning. However, over time this leader has violated these principles, and each time one is violated faith and willingness is lost. The leader does not put themselves on the front line. This honestly is okay in my opinion because I very much doubt they would be able to handle it, but other people in the department find this annoying. However, the principles that been violated that I take issues with is that they do not take care of their own people, does not expect positive results, does not know their stuff when it comes to events, has a hard time declaring expectations, and has violated their integrity. We have all take our turn being under the bus because our bigger boss needs someone to take the fall other than themselves, or stand up for us. Also, as of recently it seems that our leader has the impression that we are not good at our job which is frustrating as their recommendations are exactly what we are doing. Our leader has also recently lost their integrity as there are several moments where we feel they are lying to us. The lies themselves do not even hurt as much as it is the idea we are not worthy of the truth. It has created a sense of distrust among some of us. Luckily, though our middle manager has most of these principles so the blow is lessened, and we still have someone who we can proudly stand behind and follow.

Something else we discussed this week was the marketing planning process. The steps in the marketing planning process are:

1.       Collect data

2.       Analyze Data

3.       Develop objectives, strategies, programs

4.       Develop financial documents

5.       Negotiate final plan

6.       Measure progress toward objectives

7.       Audit

The company that I work for, we see this marketing planning process with our main product that our company puts out. In fact one of the pressures on my department is to make up for the money and resources that have been lost because our main product was not able to reach its objectives. Then the pressure is on for us to bring in more revenue. However, with our product the only objectives that have been communicated are that of increasing customer service, and charging everyone. However, there has been zero quantifiable objectives that have been expressed so it is hard for us to measure progress. We do have a new program to help us bring in more revenue. However, it has produced little results and many of us on the front line question if the new program is a good fit for our department as it seems the program is meant for a larger business with more resources in our industry than our company has or will even have for the foreseeable future. Which is a shame as it is a great program that we wish we could utilize. Also, the only final plan that seems to have been communicated to us is to charge everyone. I will say that we do have an audit on every department every year. However, that appears to be to make sure we are following policies verse that measuring our success against objectives that were set. So it appears with my company that it seems to focus on the marketing planning process with its main product but not with its other products.

So the last thing I will talk about is that of the program we have for our marketing class. It runs simulations of marketing decisions that we make so we could see what the possible results could be. So it helps bridge that gap of book and real life practice that academic classes need. After all, theory is only so good until you get out there and practice. Our assignment this week was to login and play around with it a little bit and sees what would happen. So I logged on and was trying to figure out to play around with it, and the numbers. I could not figure it out. The only thing that I could click on the page was a big “Enter Decision” button. Which of course I did not want to hit, I wanted to edit and not enter my decision that I had not made. After a while I hit the button in a throw my hands up in the air moment, and boom suddenly I could edit. So I played around a bit of the numbers on the sales force page. I found I could change all the numbers and after I hit submit be able to see how those decisions related to my budget and the amount of money I had left. This was pretty cool.