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COEUR - BCM
Business Creativity Module
“Entrepreneurial Marketing Strategy”
Andrew Turnbull ; George Snajdar
Entrepreneurial Marketing Strategy
– Outline –
1. Introduction:
Entrepreneurship, Marketing and Strategy
2. Defining the Offer
3. Defining the Market
4. Timing the Entry Into the Market
Entrepreneurial Marketing Strategy
1.1) Introduction
What do you think about the following statement?
Every successful entrepreneur
has a detailed master plan
right from the start.
a) Of course, this is true.
b) Generally, yes. More than 2 out of 3 entrepreneurs will have
some sort of documented business plan.
c) Not true. The vast majority of entrepreneurs
only have a vague idea of how things will work out.
d) Not true. An entrepreneur is someone with a great vision,
but totally incapable of organized thinking.
Entrepreneurial Marketing Strategy
1.1) Introduction
Answer:
c) Not true. The vast majority of entrepreneurs
only have a vague idea of how things will work out.
Reasons:
• Rapid change, high uncertainty
• Reluctance to commit to one single plan
• Implicit planning emerges over time
(muddling through)
Implications:
• Strategic planning is a process.
• Plan as much as you can, adapt as you proceed.
Entrepreneurial Marketing Strategy
1.2) Definitions:
Entre-/Europreneurship
Organisational level:
Individual level:
• Creative
human
capital
• Ability to
recognize
opportunities
• Willingness
to take risks
• enthusiastic
• committed
• professional
• visionary
• 'hungry‘
• open minded
European
Dimension
Entrepreneurial Marketing Strategy
• ...
1.2) Definitions:
Marketing ...
• … is the management process responsible
for identifying, anticipating and satisfying
customer requirements profitably. (UK)
• … is the discipline of conceiving offers
as a function of consumer preferences,
and promoting their commercialization.
(France)
• …is market-oriented management.
(Germany)
Entrepreneurial Marketing Strategy
1.2) The Importance
of Marketing: A Tale
New Economy (1995-2001):
Shareholder Value Management
2002 Stock Market Crash
Only those dotcoms survived
that had a sound customer base:
the True Economy .
Entrepreneurial Marketing Strategy
1.2) Individual Qualities
Comparison
The Entrepreneur…
The Marketer…
…is creative, innovative,
open for the
unconventional
…tries constantly to stay
abreast of competitors
…is ready to take risks, deal …creates or seizes market
with uncertainty
opportunities
…works for sustainable
business growth
…works to increase market
share or build better
customer relationships
Entrepreneurial Marketing Strategy
1.2) Common Misconceptions
about Marketing
Marketing is equivalent
to advertising.
Marketing is just the
icing on the cake.
Marketing is
manipulation.
Entrepreneurial Marketing Strategy
1.2) Characteristics
of Strategy
Strategy...
• involves making long/medium/short term
plans
• is contingent on top-level goals
• means mission-critical decisions
• provides a frame for individual actions
• can result in a planning document
Entrepreneurial Marketing Strategy
1.3) Combining Entrepreneurship
and Marketing Strategy
Entrepreneurial
Challenge:
Marketing
Challenge:
How best to leverage
limited resources
to help the company
grow?
How to find
a profitable and
sustainable
market position?
Strategic Balance
Entrepreneurial Marketing Strategy
1.3) Combining Entrepreneurship
and Marketing Strategy
... at different implementation levels:
• Individual:
Be a personality, a character and a creative
thinker and salesperson!
• Organization:
Grow your company and keep connected
with the customer!
• Environment:
Develop all stakeholder relations and treat
customers as your most important stakeholders!
Entrepreneurial Marketing Strategy
1.3) Entrepreneurial Marketing:
Strategic Challenges
• exceed customer expectations
• build trust, keep promises
Customers
Internal
• manage processes
• show leadership
Competitors
• seize opportunities
• change the rules
• balance attack,
defence and evasion
Entrepreneurial Marketing Strategy
2.1) Defining the Offer:
The Ansoff Matrix
Markets
existing
existing Penetration
Products
new
Market
Development
Product
new Development Diversification
Entrepreneurial Marketing Strategy
2.1) Defining the Offer:
SWOT Analysis
favourable unfavourable
Strengths
Weaknesses
internal
Opportunities
external
Entrepreneurial Marketing Strategy
Threats
2.1) Defining the Offer:
PESTLE Analysis
•
•
•
•
•
•
Political
Economic
Social
Technological
Legal
Ecological
Environment(s)
Influence on
Business Idea ?
Entrepreneurial Marketing Strategy
2.2) Defining the Offer:
The Basis For Differentiation
Product
Price
Promotion Place
Where is their basis
for differentiation ?
Entrepreneurial Marketing Strategy
2.2) Defining the Offer:
The Basis For Differentiation
Study published by Babson College, Boston, Mass., USA
Entrepreneurial Marketing Strategy
2.3) “What’s In It For Me?”
Customer Benefit Definition
product
feature
extended
opening hours
customer
loyalty card
eco-certified
products
generic
benefit
convenience
meaning
to customer
freedom
savings
feeling
market savvy
leading a
meaningful life
good
conscience
Entrepreneurial Marketing Strategy
2.4) USP — Formulate
a Unique Selling Proposition
• "When it absolutely, positively
has to be there overnight" – FedEx
• "Connecting people" – Nokia
• "Because I'm worth it" - L'Oreal
(“Parce que je le vaux bien”)
• “United Colors of Benetton”
Entrepreneurial Marketing Strategy
3) Defining the Market
– Marketing Style
Transactional Marketing
Relationship Marketing
“make-and-sell”
“sense-and-respond”
sales volume maximization
customer value maximization
branding, advertising,
distribution partners
personal selling, direct and
database marketing
packaged goods
individual services
one-time customer
lifetime customer
high market share
stable relationships
Entrepreneurial Marketing Strategy
3) Defining the Market
– Customer Profiling
Transactional Marketing:
Relational Marketing:
• Who is
your typical customer?
• How does
your typical customer
interact with you?
Build a demographic portrait:
• Age bracket, cohort
• Family life cycle stage
• Education, occupation
• Disposable income/month
• Usage pattern ...
Build a customer life cycle:
• Non-customer
• Prospect, lead
• First timer
• Repeat buyer
• Testimonial
Entrepreneurial Marketing Strategy
3) Defining the Market
– Market Forecast
Transactional Marketing:
Estimate market size
top-down:
•
•
•
•
Potential market?
Available market?
Target market?
Penetrated market after
first year in business?
Relational Marketing:
Determine minimum market
size bottom-up
(Break-even analysis):
How many customers must
be addressed to cover costs
of first year in business?
Entrepreneurial Marketing Strategy
4) Timing the Entry Into the Market
— Product/Market Life Cycle
market
volume
Product Innovator
Market Innovator
In tro d u c tio n
G r o w th
M a tu rity
Entrepreneurial Marketing Strategy
D e c lin e
time
4) Timing the Entry Into the Market
— Product/Market Life Cycle
New
customers
Main
marketing
problem
Introduction Growth
Maturity
former non-buyers
competitors’ customers
awareness,
getting
known
Promotion
product
available
tion from
competitors
market
Place
Product,
Promotion
Price
Trendiness
Distinctness Reliability
Q:
Main
instruments
Decline
How can Marketing Strategy adapt
Cycle Phases
?
raisingto different
making Life differentiaretreat from
Spin on USP Newness
Entrepreneurial Marketing Strategy
4) Timing the Entry Into the Market
— First Move Considerations
First Mover Advantages
First Mover Disadvantages
Primacy effect: Making an early
and lasting effect on customers
Recency effect: Followers have
benefit of newness
Investments into the market (e.g.:
distribution network, consumer
awareness) will pay off early.
Competitors’ free rider effect;
investments may turn out to be
exit barriers if/when market
declines
First mover can start to build
experience early, increase the lead
and solidify the strategic position
Competitors may catch up or
outperform first mover if imitation
barriers are low
Entrepreneurial Marketing Strategy
Conclusion: The Innovation Cartwheel
Harvest Profit
Finding New Ideas
Potential
Innovation
EconomiesEntrepreneurial Creativity
of Scale Marketing Strategy
– a constant interplay
of rulebreaking andMarketing
Positioning
against mainstreaming ... New Ideas
Competitors
Differentiation
Making them
acceptable to customers
Entrepreneurial Marketing Strategy