Trang 1
Edinburgh Business School MBA AUC Academic Partner Strategic Planning Module 5 – Part 1 The Company and the Market Instructor: Moataz Darwish, MBA Introduction – Moataz Darwish
Trang 3
Contents 1. The Market 2. The Demand Curve 3. Competitive Reaction 4. Segmentation 5. Product Quality 6. Product Life Cycles 7. Portfolio Models 8. Supply 9. Markets and Prices 10. Market Structures 11. The Role of Government 12. The Structural Analysis of Industries 13. Strategic Groups 14. First Mover Advantage 15. An Overview of Macro and Micro Models 5/61 16. Environmental Threat and Opportunity Profile: Part 2 EBS MBA / AUC Introduction – Moataz Darwish 3
Trang 4
The Market The market mechanism is the principal method by which resources are allocated in industrialized economies. An understanding of how markets operate provides managers with insights into the behavior of Customers Competitors Role of Government. EBS MBA / AUC Introduction – Moataz Darwish 4
Trang 5
The Market Corporate Level Are we in the right markets? What resources should be allocated to various markets? Business Unit Level What price should we be charging for our product?’ How much should we be spending on marketing?’ Functional Level EBS MBA / AUC Introduction – Moataz Darwish 5
Trang 6
Contents 1. The Market 2. The Demand Curve 3. Competitive Reaction 4. Segmentation 5. Product Quality 6. Product Life Cycles 7. Portfolio Models 8. Supply 9. Markets and Prices 10. Market Structures 11. The Role of Government 12. The Structural Analysis of Industries 13. Strategic Groups 14. First Mover Advantage 15. An Overview of Macro and Micro Models 5/61 16. Environmental Threat and Opportunity Profile: Part 2 EBS MBA / AUC Introduction – Moataz Darwish 6
Trang 7
The First Step Develop the role of Demand and Supply analysis EBS MBA / AUC Introduction – Moataz Darwish 7
Trang 8
The Demand Curve Demand Curve: Relation between the price of a good and the amount which would be bought at each price. Elastic: If quantity changes by a large relative amount when price is changed. Inelastic: if quantity is not affected much by changes in price. what the elasticity tells is what happens to total revenue when price is changed. The demand curve has important implications for pricing strategy. EBS MBA / AUC Introduction – Moataz Darwish 8
Trang 10
The Demand Curve Ceteris Paribus Concept: The approach of allowing only one variable to change while holding other things constant. Powerful method of focusing on individual variables and how they affect the company. Degree of abstraction to help think in terms of ‘what if’; EBS MBA / AUC Introduction – Moataz Darwish 10
Trang 11
The Demand Curve 1. Demand Factors 2. Demand Curve and Revenue 3. Demand Curve and Market Share 4. Demand Curve and Marketing Expenditure 5. Estimating the Demand Curve EBS MBA / AUC Introduction – Moataz Darwish 11
Trang 12
The Demand Curve 1- Demand Factors1- Demand Factors Market SizeMarket Size Company Mkt ShareCompany Mkt Share Product life cycle Price Business cycle Marketing Exogenous shocks GNP elasticity Exchange rates Level of control EBS MBA / AUC Introduction – Moataz Darwish 12
Trang 13
The Demand Curve • The shipping industry ex. Change in exchange rates. Effect on trade flows from one leg to the other. Needs marketing and price actions to respond. EBS MBA / AUC Introduction – Moataz Darwish 13
Trang 14
The Demand Curve 2-Demand Curve and Revenue How responsive the quantity sold will be to the change in price. Help predict the effect of a change in price on the revenue from selling the product. Revenue = P1 × Q1 is greater or less than P2 × Q2 Every straight line demand curve has a point at which revenue is maximized. Implication: The manager can now think in terms of whether revenues have been maximized in current situation, and what might be done to maximize revenues in the future. EBS MBA / AUC Introduction – Moataz Darwish 14
Trang 15
The Demand Curve 3-Demand Curve and Market Share The emphasis in marketing strategy tends to be on market share. Direct relationship between demand curve & market share derived from similar information. EBS MBA / AUC Introduction – Moataz Darwish 15
Trang 16
The Demand Curve 3-Demand Curve and Market Share The basic model of income: Revenue = Total market × Market share × Price The demand curve expresses this as: Revenue = Total units sold × Price Implication: forces managers to be explicit about the expected impact of price changes on the quantity bought and eventually market share. EBS MBA / AUC Introduction – Moataz Darwish 16
Trang 17
The Demand Curve 3-Demand Curve and Market Share Reduction in market share can be associated with an increase in revenue. If objective is to maximize revenue optimum price is $10 at 12.5% Mkt share. One of the strategic goals often pursued by companies is to increase market shareleads to a disagreement. Ceteris Paribus EBS MBA / AUC Introduction – Moataz Darwish
Trang 18
The Demand Curve 4-Demand Curve and Marketing expenditure It becomes increasingly difficult to achieve additional sales through increases in marketing expenditure alone Increase in expenditure may have no impact at the margin EBS MBA / AUC Introduction – Moataz Darwish 18
Trang 19
The Demand Curve 4-Demand Curve and Marketing expenditure Marketing Campaign would cause more of the product will be sold at each price than before - shift the demand curve to the right (Figure 5.3) It is necessary to change people’s preferences using lots of resources (time & money) in order to: Persuade people to buy more of product and less of something else or Save less Pepsi spent $500mln in 1996 simply on changing the can color EBS MBA / AUC Introduction – Moataz Darwish 19
Trang 20
The Demand Curve 4-Demand Curve and Marketing expenditure Its is a powerful marketing strategy tool to combine a shift of the demand curve with a movement along the demand curve (price reduction). Distinction between them is very important: Shift is due to lots of factors (mostly outside Co control, ex: reduction of the price of a substitute product, or increase in price of a complement. One question which should be considered is the likely impact of extraneous effects on the demand curve for the company’s product helps in formulating a strategic response EBS MBA / AUC Introduction – Moataz Darwish 20
Hiển thị 20 trang đầu. Tải tài liệu để xem đầy đủ.
Bình luận (0)
Chưa có bình luận nào. Hãy là người đầu tiên!