Yola



IINSTITUTE OF MANAGEMENT SCIENCES

MARKETING STRATEGY

ASSIGNMENT TYPE : WAC, WAC PRESENTATION, PROJECT

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Contents

1 ] INTRODUCTION 4

2 ] A SITUATION ANALYSIS 4

The Macro Environment 5

DEEP-LIST analysis 5

An Industry Analysis 5

Mission/Goals & Objectives 6

Segmentation & Target Market 6

Marketing Mix 7

PLC/CLC/ILC 7

Portfolio Analysis 8

KSF 8

USP 8

Market Analysis 9

Market Share: 9

Sales: 9

Growth Rates: 9

Competitive Analysis 9

Product Attribute Analysis 10

SWOT ANALYSIS 10

Ansoff Matrix 11

Ansoff’s Product-Market Expansion Grid 12

Financial Analysis. 12

Market Share 12

Sales Analysis 12

Ratio Analysis 12

Common Ratios 13

Analysis of Financial Statements 13

Example: Income Statement. 14

Break Even Analysis 14

Computing Break Even 15

Break Even Point. 15

Formula For Calculating BEP IN UNITS 15

Break Even Point in Dollars 15

Break Even Plus Profits. 16

Break Even plus Profits. 16

Over All Work Sheet 16

3 ] Problem Identification 17

IDENTIFICATION OF MAIN PROBLEM 17

IDENTIFICATION OF SUB PROBLEM 17

4 ] Alternatives to the Main Problem 17

5 ] EVALUATION OF EACH ALTERNATIVE 18

6 ] Selection of Best Alternative 18

7 ] IMPLEMENTATION 18

8 ] RECOMMENDATION/S 18

1 ] INTRODUCTION

■ In the introduction you will give a short synopsis of the case.

■ Inform the reader what industry does the company belongs, what the time of the case, who are the key players, what issue is at hand.

■ Remember not to reveal any hard facts in the introduction part as they have to be utilized in the upcoming steps.

■ Usually an introduction would include the following:

■ Time of case

■ Industry of operations

■ Time of establishment of company

■ Key People

■ Important dates if any in the case

■ Size of company

■ Main Line of business of the company.

■ Geographic Area (e.g. Region, Country or City in which operations are being held)

■ Others

■ Remember: NO HARD FACTS.

2 ] A SITUATION ANALYSIS

Elements of Situational Analysis

■ Macro Environmental Analysis

■ DEEP-LIST Analysis

■ Industry Analysis

■ Mission

■ Goal

■ Objectives

■ Segment and Target Market

■ Marketing Mix

■ PLC/CLC/ILC

■ Portfolio Analysis

■ KSF’s

■ USP’s

■ Market Analysis

■ Market Share

■ Sales

■ Growth Rates

■ SWOT analysis

■ Ansoff Matrix

■ Competitive Analysis

■ Financial Analysis

■ Strategic Analysis

The Macro Environment

DEEP-LIST analysis

■ Demographic

■ Ecological

■ Economic

■ Political

■ Legal

■ Informational

■ Social

■ Technological

Give the factors of the above that affect the case only

An Industry Analysis

Solutions From Porter’s 5 Forces Model.

■ By analyzing this model you will have to identify either a industry is

■ Attractive

■ Unattractive

■ Moderate.

■ Remember these Five forces can have the following effects.

■ Either a force e.g.

■ Bargaining power of suppliers can be HIGHER OR LOWER.

■ If it is Higher, then it is NEGATIVE FOR THE COMPANY.

■ If it is LOWER, then it is POSITEVE FOR THE COMPANY.

■ So a force that is Negative

■ A Force that is Positive for the company.

■ A Force can also have a Moderate (~) effect

■ Analysis Continued.

■ You will evaluate these five forces and see how many are positive, Negative or Moderate.

■ Then At the end, you will after looking at the positive and negative forces, give conclusion about the ATTRACTIVENESS OF THE INDUSTRY.

■ Remember that an unattractive industry does not means that profitability will also be Negative.

■ A company can make profits even in an unattractive industry and vise versa.

■ e.g. Nishat Mills is making a profit, although the Textile industry of Pakistan is UNATTRACTIVE.

■ Analysis Continued.

■ You will evaluate these five forces and see how many are positive, Negative or Moderate.

■ Then At the end, you will after looking at the positive and negative forces, give conclusion about the ATTRACTIVENESS OF THE INDUSTRY.

■ Remember that an unattractive industry does not means that profitability will also be Negative.

■ A company can make profits even in an unattractive industry and vise versa.

■ e.g. Nishat Mills is making a profit, although the Textile industry of Pakistan is UNATTRACTIVE.

Mission/Goals & Objectives

■ Find any explicit or implicit statement of the firms mission.

■ Goals and Objectives:

■ Look for the expressed or implied goals and objectives of the firm

■ The importance of this is that after your analysis you can have a good picture of either the company is really achieving/following its mission/goals and objectives or not.

Segmentation & Target Market

■ Segments Dealing in:

■ Demographics

■ Geographic

■ Psychographics

■ Media Graphics

■ Define the appropriate Target market that the firm seeks to pursue.

■ Customer Profiling

Marketing Mix

■ Here you have to give details of the Marketing Mix.

■ Use the 7 P’s Model.

■ The 4 Hard P’s

■ The 3 Soft P’s are:

■ People

■ Processes

■ Physical Evidence

PLC/CLC/ILC

■ ILC: Industry Life Cycle

■ CLC: Company Life Cycle

■ PLC: Product Life Cycle

[pic]

Portfolio Analysis

■ The BCG Matrix

■ Though this is a portfolio analysis that is meant to analyze different businesses in the entire portfolio, but we will use this model for our product analysis.

■ Identify where the Product/ Products of the company fall in this matrix.

[pic]

KSF

■ This part will identify the KSF’s of the business or in other words the KEY SUCCESS FACTORS

■ KSF’s are thing that are important while operating in an industry. Remember you have to list the factors for the industry and NOT the internal company factors.

■ These are the Key Factors for Success for any business operations in an INDUSTRY.

USP

■ The Unique Selling Preposition helps identify the main differentiation upon which the company is banking upon.

■ The USP’s have to be identified so that the Positioning strategy of the company can be analyzed.

Market Analysis

Market Share:

Look at Quantitative or Qualitative information that describes the past and current market Share position

Sales:

Sales Growth rates or Sales figures will be plugged here. This will help you to analyze the next point.

Growth Rates:

You will analyze the TRENDS in the patterns of Growth or Decline of the above two factors.

Competitive Analysis

■ Here you can analyze the Share Analysis of different competitors or the Product Attribute Analysis

Competitive Analysis

Market Share, Mind Share, and Heart Share

| |Market Share |Mind Share |Heart Share |

| |2000 |2001 |2002 |

|Price | | | |

|Quality | | | |

|Features | | | |

|Benefits | | | |

|Style | | | |

|Overall Rating: |

|Remarks: |

SWOT ANALYSIS

■ Here look at the strengths/weaknesses/opportunities/threats

■ Remember

■ Opportunities and Threats are External

■ Strengths and Weaknesses are Internal.

THE SWOT MATRIX

[pic]

Quantitative Assessment of Elements within the SWOT Matrix

[pic]

Ansoff Matrix

[pic]

Ansoff’s Product-Market Expansion Grid

[pic]

Financial Analysis.

■ Financial Analysis includes analysis like

■ Market Share

■ Sales Analysis and Trends.

■ Ratio Analysis

■ Break Even Analysis

■ Analysis of Financial Statements

Market Share

■ Previously you have computed the Market Share of the Firm and also in the competitive analysis the Shares of competitors

■ Now you have to give a comparative situation by merging the both the previously done analysis.

■ Use a Tabular form to do this.

Sales Analysis

■ Here you can use Tables or Graphs to present the sales analysis of the company and its competitors or substitutes.

■ Be Creative over here

Ratio Analysis

■ Financial Ratios determine the relationship between two variables, and with the help of company ratios and industry ratios we can undergo a comparative analysis for the operating of our firms.

Common Ratios

|Ratio |Formula |

|Current Ratio |Current Assets |

| |Current Liabilities |

|Acid Test Ration or Quick Ratio |Current Assets- Inventory |

| |Current Liabilities |

|Inventory Turn Over |Cost of Goods Sold |

| |Average Inventory |

|Total Asset Utilization |Net Sales |

|ROA |Total Assets |

|Profit Margin On Sales |EBIT |

| |Sales |

|ROI |EAT |

| |Total Assets |

|ROE |Net Income |

| |Shareholders Equity |

Analysis of Financial Statements

■ Most commonly three statements are analyzed:

■ Balance Sheet

■ Income statement

■ Cash Flow Statement

Example: Income Statement.

|Sales | |3,600 |

|Cost of goods sold | |2,700 |

| | | |

| Gross Profit | |900 |

|Less operating expense: | | |

| Selling expenses |40 | |

| General & Administrative |60 |100 |

|Gross Operating revenue | |800 |

|Less Depreciation | |250 |

| Net operating income | |550 |

|Less other expenses | |50 |

|EBIT | |500 |

|Less Interest expenses | |200 |

|Earning Before Tax | |300 |

|Less federal and state income tax |(40%) |120 |

|Earnings After Taxes (EAT) | |180 |

Break Even Analysis

■ Break even point is that level of sales in either units or sales dollars at which a firm covers all the costs of investing in a project.

■ It is the level at which total sales revenue just equals the total costs necessary to achieve these sales.

Computing Break Even

■ Three values are required to calculate the BEP.

▪ Selling price per unit

▪ Level of Fixed Cost (TFC)

▪ Variable cost per unit produced (VC)

Break Even Point.

[pic]

Formula For Calculating BEP IN UNITS

Fixed Costs

Contribution Margin

FC

SP-VC

Break Even Point in Dollars

FC

1 – VC

SP

Break Even Plus Profits.

FC + Profit

SP- VC

In terms of Sales Dollars

Break Even plus Profits.

FC + P

1 – VC

SP

Over All Work Sheet

|Environment |Relevant Issues |Case Impact |Case Importance |

| | |(Favorable/Un fav) |Imp/ Un imp |

|General Envt | | | |

|Social |___________ |____________ |____________ |

|Economic |___________ |____________ |____________ |

|Political |___________ |____________ |____________ |

|Legal |___________ |____________ |____________ |

|Technological |___________ |____________ |____________ |

|Operating Envt | | | |

|International |___________ |____________ |____________ |

|Suppliers |___________ |____________ |____________ |

|Competition |___________ |____________ |____________ |

|Customers |___________ |____________ |____________ |

|Labor |___________ |____________ |____________ |

|Internal Envt | | | |

|Organizational |___________ |____________ |____________ |

|Marketing |___________ |____________ |____________ |

|Financial |___________ |____________ |____________ |

|Personnel |___________ |____________ |____________ |

|Production. |___________ |____________ |____________ |

3 ] Problem Identification

IDENTIFICATION OF MAIN PROBLEM

■ Remember to distinguish the Symptoms from the problem!

■ Problems are identified in terms of

■ Time

■ Impact.

■ i.e. if the time to solve the problem is less, and if not solved the impact will be very high, it is the Main Problem

IDENTIFICATION OF SUB PROBLEM

■ Sub Problems have to be identified, so you will only list them over here.

■ The treatment to the sub problems will be dealt at the last stage of case analysis.

■ List a maximum of three (3) sub problems over here.

4 ] Alternatives to the Main Problem

■ Give at least three (3) viable alternatives over here that can solve the main problem

■ These alternatives can also be your strategies that you wish to implement.

5 ] EVALUATION OF EACH ALTERNATIVE

■ Here you have to evaluate each individual alternative separately.

■ You will look at the Cost and Benefits of each alternative, or in other words the Pro’s and Con’s.

■ To do this you will use the following Table.

|Alternative #1: ____________________ |

|Pro’s |Con’s |

|. |. |

|. |. |

|. |. |

6 ] Selection of Best Alternative

■ This is the solution to your problem.

■ Here you will after having performed an analysis on all the alternatives, select one alternative that:

■ Has more Pro’s then Con’s

■ Solves the problem completely

■ Is your final Solution for the case

7 ] IMPLEMENTATION

■ Implementation means to bring the best suited alternative to the practical form.

■ Here you will give details in how will you implement the alternative.

■ Basically you will answer the following:

■ What to do?

■ When to do it?

■ How to do it?

■ Who will be responsible for the implementation?

■ Costs (if you can give the implementation costs)?

8 ] RECOMMENDATION/S

■ These usually help or rectify all the sub problems that you have solved.

■ Recommendations can be given in bullet form or they can be given in paragraph form as well.

■ You might want to give recommendations to each of the sub problems that the company is facing.

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Threat Of New Entrants

Bargaining Power Of Buyer

Bargaining Power Of Suppliers

Industry Competitors Internal Rivalry

Threat Of Substitutes

PAK - AIMS

Analyze & Record the Problems & Core Element.

Major Problem Or Issue

Description f Problem or Issue:

Evidence that this is a major problem:

Facts:

Symbols or other effects:

Opinions:

Assumptions:

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