MARKET IDENTIFICATION & COMPETITIVE ADVANTAGE

Lesson we can Learn:

Once we are already in a business (as being wet), we might as well give all our best and all that is needed, to be successful in our field rather than be a follower at all times, we can lead if we want to lead, just choose your niche properly

MARKET IDENTIFICATION

A. WHAT IS A MARKET?

A group of customers or consumers who share the same needs, and who are willing to buy a place where buyers and sellers come together

B. CRITERIA FOR MARKET SELECTION

1) 2) 3) 4) 5) 6) Proximity Socio-political conditions Economic conditions Culture Technological Conditions Geophysical, climatic conditions

1) Proximity

There may be markets close to home which could contain potential buyers of present products for export
Trend nowadays is that most nations have their largest trading volume with their neighbors

2) Socio-political Conditions

After having listed the potential markets within neighboring countries, start looking for potential markets further away This may lead to listing the countries that have common interest with ours, e.g. in an economic community, also indicated as trading bloc There are several such communities: the ASEAN, the European Union, NAFTA in North America, Mercosur in South America and so on Such communities are mainly based on a political agreement on the necessity of common (economic) interests
7

contdsocio-political conditions

Look also for countries where the social structure (relationships, family composition, age division, lifestyles, etc.) resemble our country Screen countries that have social and/ or political environments comparable to ours Select countries that show most similarities - for the simple reason that fewer risks of misunderstanding may occur during business

Market Identification

3) Economic Conditions

This refers to the target countries economic possibilities or, simply put, can the people afford to buy our goods? Several macro-economic factors are considered, such as the GNP/ GDP, private consumption, general government consumption, etc.

Criteria for Market Selection

9

4) Cultural Differences

People have different ideas about what is good or appealing Consumers will have different preferences and different buying habits The task of the exporter is to recognize that there are cultural differences and to estimate their effects on communication and commercial operations The exporter does not necessarily have to understand culture, but more importantly to respect them
10

5) Technological Conditions

Tries to describe the relative degree technological advancement in export countries

of

Export products suitability would depend on the level of technological development of the target country

11

6) Geophysical & Climatic Conditions

Identify conditions of climate and geophysics which may influence logistics (transport, storage) Ex, selling ice-cream in the ASEAN started becoming big business only after the supplier installed a chain of open-top cooling display units

12

C. EVALUATING FOR MARKET SELECTION

Having the data, you will list all the information about the target countries; Apply the selection criteria Judge the attractiveness of the target countries by giving them a score Rank markets according to scores

13

MARKET INFORMATION
(ORGANICS and NATURAL PRODUCTS

TRENDS IN MAJOR MARKETS: Increase in health awareness Consumers became more critical when purchasing food Sales of organic horticultural products have been expanding rapidly in many of the major organic markets (e.g EU, USA, Japan)
14

Contn. Market Information

Groups of consumers are willing to pay a certain premium for organic foods

The economies of many developing countries are dependent on the export of a relatively small number of commodities (mostly agricultural)
15

PHILIPPINE MARKET STRATEGY

PRODUCTS IN FOCUS: FOOD

Rice, Muscovado Sugar, Coconut Sugar, Virgin Coconut Oil, Nata De Coco, Coffee, Chicken, Mango & Fresh Vegetables
16

Contn Product in Focus

HERBAL Banaba, Ampalaya, Lagundi ESSENTIAL OILS Citronella, Ilang-Ilang, Lemon Grass, Elemi Oil

17

MARKET DRIVEN PRODUCTS

PRODUCT Muscovado Sugar Virgin Coconut Oil Chicken Mango MARKET Europe Europe, USA, Japan Malaysia, Japan Belgium & Italy
18

PRODUCTS WITH STRONG MARKET POTENTIALS

PRODUCT RICE COFFEE CITRONELLA ILANG-ILANG MARKET EUROPE EUROPE, USA EU EU

19

FOOD
A.

GLOBAL TRENDS TOWARDS 2011 The driving forces are: Value in money, convenience and time.

20

Contn. FOOD

The Demand For: A. Healthy, natural foodstuff and festival food such as low fat, low salt, low sugar, easy to digest food products, high fiber and additive-free foods

21

Contn. demand (Food)

B. Growing demand for gourmet meals, exotic ethnic and high-value added foods C. Convenience foods, easy to prepare, microwavable food products but with emphasis on quality and safety
22

Philippine Market Strategy (Food)

USA Product Coverage: Ethnic Foods, Snack Foods, Dried Fruits & Juices EU Product Coverage: Dried Fruits, Juices, Snack Foods, Fresh Mango Strategy: Compliance to standards to facilitate entry of food products
23

Contn. Market Strategy

ASEAN Product Coverage: Fruit Juices, Dried Fruits, Beverages Strategy: HALAL Certified Products

24

Contn. Market Strategy

TAIWAN

Product Coverage: Snack Foods, Coffee, Juices, Confectionary, Dried Fruits & Fresh Mango and Pineapple

25

Contn. Market Strategy

KOREA Product Coverage: Dried Mango, Banana Chips, Mango Juices, Snack Foods, Fresh Mango, Coffee CHINA Product Coverage: Fresh Fruits, Processed Fruits & Sauces Strategy: Country Branding
26

Contn Market Strategy

JAPAN Product Coverage: Fresh Fruits, Fresh Chicken, Fried Fruits, Fruit Juices MIDDLE EAST Product Coverage: Fresh Banana, Mango and Pineapple Strategy: HALAL Certified Products
27

2. COMPETITIVE ADVANTAGE

28

COMPETITIVE ADVANTAGE

When a firm sustains profits that exceed the average for its industry, the firm is said to possess a competitive advantage over its rivals. The goal of much of business strategy is to achieve a sustainable competitive advantage

29

Competitive Advantage

TYPES OF COMPETITIVE ADVANTAGE

Two basic types of competitive

advantage:

Cost Advantage Differentiation Advantage

30

COMPETITIVE ADVANTAGE

A competitive advantage exists when the firm is able to deliver the same benefits as competitors but at a lower cost (cost advantage), or deliver benefits that exceed those of competing products (differentiation advantage). Thus, a competitive advantage enables the firm to create superior value for its customers and superior profits for itself

31

COMPETITIVE ADVANTAGE

Cost and differentiation advantages are known as positional advantages since they describe the firm's position in the industry as a leader in either cost or differentiation.

32

COMPETITIVE ADVANTAGE

Resources and Capabilities

According to the resource-based view, in order to develop a competitive advantage the firm must have resources and capabilities that are superior to those of its competitors. Without this superiority, the competitors simply could replicate what the firm was doing and any advantage quickly would disappear. Resources are the firm-specific assets useful for creating a cost or differentiation advantage and that few competitors can acquire easily. Ex. Patents and Trademarks, Reputation of the Firm
33

COMPETITIVE ADVANTAGE

Capabilities refer to the firm's ability to utilize its resources effectively. An example of a capability is the ability to bring a product to market faster than competitors. Such capabilities are embedded in the routines of the organization and are not easily documented as procedures and thus are difficult for competitors to replicate.
The firm's resources and capabilities together form its distinctive competencies. These competencies enable innovation, efficiency, quality, and customer responsiveness, all of which can be leveraged to create a cost advantage or a differentiation advantage.
34

COMPARATIVE ADVANTAGE
When one nation's opportunity cost of producing an item is less than another nation's opportunity cost of producing that item. A good or service with which a nation has the largest absolute advantage (or smallest absolute disadvantage) is the item for which they have a comparative advantage.

35

BRAND MANAGEMENT

36

BUILD A PROFITABLE PREFERRED BRAND

BECOME THE SUSTAINABLE BRAND OF CHOICE BY CONSUMER

37

WHAT COMES TO YOUR MIND WHEN THE FOLLOWING PRODUCTS ARE MENTIONED?

TOOTHPASTE VAPOR RUB EYE DROP INSTANT COFFEE CELLPHONE SOFTDRINKS BEER
38

The fact that you remember the brand name and have positive associations with that brand makes your product selection easier and enhances the value and satisfaction you get from the product.
39

Products can be copied by competitors.

A BRAND cannot.
40

BRANDING

USE OF A NAME, TERM, SYMBOL OR DESIGN OR COMBINATION OF THESE TO IDENTIFY A PRODUCT

41

BRAND NAME
Word, letter, or group of words that identifies the product and/or its manufacturer

42

TRADEMARK
Includes only those words, symbols or marks that are legally registered for exclusive use by a single company or manufacturer.

43

LABELLING
To give information about the contents of a package, and to promote the product

44

WHAT IS A BRAND?
Brand is the propriety visual, emotional, rational, and cultural image that you associate with a company or a product

45

BRAND
A sellers promise to consistently deliver a specific set of features, benefits and services to the buyers.

Conveys a warranty of quality.

46

LEVELS OF MEANING

Attributes

Mercedes Benz suggests expensive, well built, well engineered, durable, high prestige, high resale value, fast and so on.

Benefits

The attribute expensive might be translated into the emotional benefit. The car helps me feel important and admired.

47

Values

The car stands for high performance, safety, prestige and so on.

Culture

The brand may additionally represent a certain culture. The Benz represents German culture: organized, efficient, high quality
48

Personality

It a brand is a person, an animal or an object, what would come to mind? Mercedes Benz may suggest a no-nonsense boss (person), a reigning lion (animal) or an austere palace (object)

49

User

The brand suggests the kind of consumer who buys or uses the product. We would be surprised to see a 20 year old secretary driving a Benz. We would expect instead to see a 55 year old top executive behind the wheel.

50

WHY BRAND EXIST?

IDENTIFICATION

Brands enable consumers to easily distinguish one product from another.

PROTECTION

Enables the owner to enjoy the goodwill associated with the name so as not to be taken advantage by others.
It enables the owner to communicate the benefits of his product vis--vis competition
51

POSITIONING

WHAT MAKES UP A BRAND IDENTITY?

BRAND NAMES LOGOS POSITIONING BRAND ASSOCIATIONS BRAND PERSONALITY

52

BRAND NAME DECISION

Individual Brand Names

Barako, Red Bull Sony and Pioneer Panasonic for audio visual products National for household goods and Technics for hi-fi products
53

Blanket Family Name for All Products

Separate Family Name for All Products

Criteria for Choosing a Brand

Distinctive

Is the brand closely associate with the product? Does it have a pleasant meaning Can it be registered? Can your name be remembered easily?
54

Word Association

Legal Requirements

Memorability

PRONOUNCIABILITY

Can it be pronounced easily? Is the brand name too limiting to be used for expansion?

LIMITATIONS

55

IS BRANDING JUST FOR LARGE COMPANIES?

NO!
Our process can be applied to any business, organization or product

56

HOW DO WE DETERMINE OUR BRAND IDENTITY?

Brand has been called the most powerful idea in the commercial world, yet few companies consciously create a brand identity.

57

Do you want your companys brand identity created for you by competitors and unhappy customers?

OF COURSE NOT

58

The techniques of branding have been kept secret for many years because they provided a competitive advantage to those companies that used them.

59

PRODUCT POSITIONING

60

POSITIONING

Is offering benefits or impression of a brand better than competition in the mind of the consumers, or simply how it is different from the rest. The act of communicating to consumers that over all positive impression for a brand relative to competition.
61

HOW IS POSITIONING ACHIEVED?

MEDIA COMMUNICATIONS

Firms launch activities that are relevant to their market and their communities, thus endearing them to the public.

Metro Banks Most Outstanding Teacher.

Avons Gintong Ilawan search for Most Outstanding Principal Milos sports development program
62

MARKETING POLICIES

Adopt policies consistent with its desired image.

Honda adopted a worldwide policy not to allow its cars to be used taxis.

63

TURNING IMAGE TO POSITIVE ONE

Cebu Pacific certification under ISO9000 and Aviation Quality and Safety 9000/121 to assure consumers of their safety. Philippine Airlines on time departure and arrival

64

COMPONENTS IN FORMULATING POSITIONING

UNIQUE DIFFERENTIATION

FEATURES/PRODUCT ATTRIBUTES SATISFIERS VS. MOTIVATORS.

BENEFITS FROM WHAT FEATURES CAN DO COMPETITIVE FRAME

65

Alternative Positioning

Price

Beer na Beer: Kuhang kuha ang lasa sa mas mababang halaga. Philippine Daily Inquirer: Sold-out because we dont sell out. Boracay: The worlds best tropical beach. Ginseng: proudly made in Korea
66

Product Attribute

Product Category Product Source

: :

User Segment Usage Behavior

: :

Athena: The milk for women Viva Mineral Water: Wash away your excesses.

Experience/Feeling

ChowKing: Dito kumakain ang masarap kumain. Nizoral Shampoo: 100 times better than the leading brand.
67

Against Competition

POSITIONING GUIDELINES

What position do you currently own? What position do you want to own? Whom do you have to defeat to own the position you want? Do you have the resources to do it? Can you persist until you get there? Are your tactics supporting the positioning objective you set?
68

REPOSITIONING

Undertaken to change the past perceptions of the target customer.

69

RULE

The more extreme the change the more difficult the repositioning

70

REPOSITIONING CONCEPT

Changing an old brand positioning to a new brand positioning.

Changing consumer perception of competitors

71

REMEMBER, IT IS THE BUYER WHO WOULD POSITION THE BRAND IN HIS MIND AND THE MARKETER CAN ONLY PROPOSE THEIR POSITIONING

72