Summary
The purpose of marketing is to act in such a way that a company puts products on the market that correspond to demand, that is, satisfy the needs and wants of its customers with a significant and sustainable competitive advantage and at a profit. This approach complements and replaces short-term approaches that favor the product, the manufacturing method, or the sales method. By relying on long-term customer satisfaction and by allowing the company to organize itself so that it can respond to...
Relabeling
Relabeling is the purchase of finished products or components that are then sold under the company's brand name. For example, Dell tapped Network y Hiring from industry External funding Figure 2.10 External sources for the development of technology competence. Appliance in 1999 for selling high-end storage servers. More recently Hewlett-Packard signed a partnership with Procom to resell its competing products.
Strategic groupings of companies
Generally speaking, in a particular market, the more companies are alike, the more they will have a tendency to compete against each other. This observation leads to the definition of strategic groups a collection of companies that have performed similar strategic choices. Usually a strategic group acts as a reference point for group members in formulating competitive strategy. The number and size of strategic groups, as well as the strategic distance that separates them should be correctly...
Case Study Nokia Segmentation and Targeting Strategy
Nokia has built its success on its ability to target different niches for wireless telephones. Segmentation is so crucial to Nokia that in 2002 it broke its 24 billion mobile phone division into nine business units, each one focusing on different parts of the market. Six months later, Nokia had its first results from the reengineering among the 24 new products planned to be introduced in 2004 The Nokia 2100 proposes a functional photo insert cover, animated screensavers, and SMS chats, well as...
The bargaining strength of complementors
A complementor can be defined as a firm that provides complementary products or services, as well as added value to an existing product or services 11 . For example, to install ERP or CRM software from SAP or Oracle in a large company requires huge organizational complexity. Complementors such as Accenture, Cap Gemini Ernst amp Young, and hundreds of smaller and more specialized consulting firms, are helping the organization to implement and to adapt to the software. Consequently, the...
The physical and virtual value chain model
Value chain analysis helps to describe the various separate activities within a firm and to assess their performance when combined into a system in producing value for money solutions. According to the now-traditional model introduced by M. Porter 19 , there are five categories of primary activities and four categories of support activities. This model helps top managers to pinpoint the key activities of the firm and their interrelations with others to yield maximum value for customers in...
Monitoring procedures
Monitoring procedures plan an evaluation schedule for the progress of the action programs, as well as of the results of the marketing strategy in terms of the sales and profit figures. The evaluation process must serve as a reference point for the marketing manager, who then has the opportunity to correct the company's marketing strategy. The evaluation process should not, however, become a restraining device that will keep it from adapting itself to the market. Bureaucratic companies do not...
The Meaning of Marketing for HighTech Firms
It is clear that successful marketing strategies have been fundamental for all the high-technology firms that have managed to survive the technology crash of 2001 and even to thrive after it. However, the words marketing for high-tech firms often hide confusion. First, consider the term marketing. Regis Mac-Kenna, a leading marketing specialist who works with numerous high-tech companies, claims that Marketing is everyone's job, marketing is everything, and everything is marketing 1 . This...
Acquisition
Acquisition of a company is the last way to develop a new business by directly buying market share and innovation competencies. Examples are numerous in various high-tech industries. For instance, in order to boost its product offering for small and medium firms, Microsoft bought smaller rivals, such as Great Plains, in 2001 for 1.1 billion and the Danish Navision in 2002 for 230 million, and in May 2002, HP finally managed to buy Compaq for an estimated 19 billion. Two months later, IBM...
A short life cycle
The second feature of high-tech products is that they are developed and replaced at a high rate. Such a cycle of replacement is driven by the exponential performance achieved by researchers in the improvement and sometimes also the replacement, as we will see next of existing technologies. The archetypal and emblematic example involves microprocessors. Moore's Law named after Gordon Moore, one of Intel's founders clarifies the development of product performance the number of transistors per...
Case Buy Now Pay Later Does It Work the Same Way for Computers and Cars
In October 2002, IBM introduced a new financing plan called Total Usage Financing, designed to stimulate spending for its on-demand computing services from cash-strapped businesses. The plan spread the cost of technology purchases over several months and included a revolving line of credit. Like a pitch from a car manufacturer, IBM announced a triple zero financing package, that offered large and mid-sized businesses zero down, zero payments, and zero interest until 2003. Other technology...
Action programs
Action programs correspond to the implementation of each element of the marketing mix by market. These action programs indicate which steps must be taken, their responsibilities, their deadlines, and their available financial resources and budgets. Since the environment changes very quickly in the world of high technology, action programs must be developed according to a relatively flexible format so that they can easily be reviewed and modified. Budgetary procedures must especially be open to...
The Irresistible Rise of HighTech Services
A revolution is at work in the high technology industry the irresistible growth of business-to-business high tech services. Consider the case of IBM. In 1983 hardware revenues represented 83 of the company's total turnover, while its service revenues were only a meager 2 , three times less than software revenues. In 2001, services contribute to 40 of the total revenues while hardware now represents only 38 of its revenue stream. During the same period, services revenues have grown from 8...