Meaning of Entrepreneurship and Entrepreneur
(www.investopedia.com.www.reference.com www.europeanentrepreneurship.com)
Entrepreneurship
This is an act of creating a business or businesses while building and
scaling it to generate a profit. It is an important driver of economic growth
and innovation.
What people do to take their career and dreams into their hands and
lead it in the direction of their own choice. It is about building a life on your
own terms. No bosses! No restricting schedules! And no one holds you back!
(Batalla 2011).
An entrepreneur is...
A person who sets up a business with the aim of making a profit and
creating a new business, bearing most of the risks and enjoying most of the
rewards. An innovator, a source of new ideas, goods, services, and
business/or procedures. Playing a key role in any economy, using the skills
and initiative necessary to anticipate needs and bring good new ideas to
market (Batalla 2011).
small-scale
Note: Understanding what an entrepreneur is can help more people
recognize the value they contribute to the world. Entrepreneurs take the
idea and execute it while entrepreneurship is about execution of ideas.
Entrepreneurship in the Philippines (Batalla, V. (2011)
The notion of the entrepreneur is simply one who forms and manages
business that is apparent in government programs. It attempts to develop
industries. In the Philippines, many entrepreneurial
development-training programs rest on such assumptions. But even without
the presence of government support, the statistics for the past fifty years or
so on the number of businesses were mostly in food processing, property
development, and trade (including shopping malls).
In 2005, the top 50 Philippine corporations in terms of sales could be
broken down into 22 private domestic firms, 23 foreign firms, and 5
government-owned and/or controlled corporations (BizNews Asia 2007as
cited by Batalla, V., 2011). The 22 companies could be identified with 11
families and individuals, mostly Filipinos of Chinese ethnic background. The
11 families and individuals were the Zobel family (Ayala), the Lopez clan,
Lucio Tan, Henry Sy, John Gokongwei, Alfonso Yuchengco, Eduardo
Cojuangco Jr., Jose Yao Campos (Unilab Group of Companies), George Ty
(Metrobank), Mariano Que (Mercury Drug), and Tony Tan-Caktiong (Jollibee).
Importance of Entrepreneurship (www.reference.com)
1. Entrepreneurship generates new wealth in an economy.
2. Entrepreneurship decreases poverty.
3. It creates opportunities, ensures social justice, instills confidence and
stimulates the economy.
4. Entrepreneurship improves productivity
5. Entrepreneurs create jobs.
6. Entrepreneurs innovate.
7. Entrepreneurs create innovation and social change
8. Entrepreneurs give to society
Relevance of Entrepreneurship to SHS Students
(www.europeanentrepreneurship.com)
1. To prepare students for livelihood even before college.
2. Entrepreneurship education aids students from all socioeconomic
backgrounds to think outside the box and nurture unconventional
talents and skills.
3. Entrepreneurship develops their initiative and helps them to be more
creative and self-confident in whatever they undertake and to act in a
socially responsible way.
4. It exposes students to numerous opportunities to learn how to think
critically and analyze the pieces on the board.
5. Being aware of all the important factors and seeing how they affect
each other is the foundation of a smart decision-making process.
6. Students have to be exposed to real-world examples and learn from
their own experience.
7. Entrepreneurship education requires students to be innovative,
creative and collaborative with others.
8. Entrepreneurship education provides budding entrepreneurs with the
skills and knowledge to come up with business ideas and develop
their own ventures.
The Potential Market
1. Potential market is the part of the total population that has shown some
level of interest in buying a particular product or service. Potential market is
also called Total Addressable Market (TAM) (MBA Skool Team, 2018).
2. A potential market is the part of the market you can capture in the future.
It includes the demographic groups that are not currently your customers
but could become customers in the future (Lake, L, 2019).
3. Market potential is the total demand for a product in a given business
environment (Bhasin, H., 2018).
The Importance of Potential Markets (Lake, L., 2019)
Potential markets are an important part of a business's future growth.
Ensure the future of your business by identifying new customers. Think
proactively about ways for your business to grow and change. Show the
potential of your business to investors or collaborators.
Increase your
revenue. Create a plan B that will weather changes in the economy or
market.
How to Identify Your Potential Markets (Lake, L., 2019)
Consider every target demographic that you currently sell to, as well
as those you have not yet targeted. Identify what they have in common with
each other, new milestones that they will encounter in their lives that will
impact their buying patterns, and where they overlap or diverge from your
current customers.
Ask yourself these questions to help you identify both new ways to
market your current products or services, as well as new products and
services that you can begin selling.
What other products do my customers need now?
What related products will they need in the future?
Who else could make use of the products I am selling now?
What demographic information does that new group have in common
with my current customers?
What demographic information does that new group have in common
with each other?
For example, a business that makes face masks and PPEs could identify
potential markets such as:
Hospitals and other health related industries whose employees are
prone to COVID -19 virus and other viruses.
Business industries and other organizations who want to ensure the
health condition of their employees.
• Employees and workers who need to report to work to earn income.
Households who needs to go out for their necessities.
Note: Depending on the size and age of your company, as well as your
industry, you may have a clear picture of the potential markets that are
available.
Reaching Your Potential Market (Lake, L., 2019)
Once you've identified and chosen a potential market to begin
targeting, you will need new marketing strategies in place to communicate
with them. Use this profile to identify:
.
The demographic information that people in a group have in common.
The best forms of media to reach them.
How they prefer to shop and make purchases.
The concerns, struggles, or problems that you can help them
overcome.
What values matter to them, both in everyday life and when shopping.
The language that resonates with them.
.
Available Market
These are prospects who are willing and capable (have sufficient
resources) buyers, and have access to a particular market or service
(www.businessdictionary.com). It is defined as the number of people who are
both willing and capable of buying a particular product or service in a
particular market (MBA Skool Team, 2020).
Target Market
This refers to a group of potential customers to whom a company
wants to sell its products and services. Target markets are generally
categorized by age, location, income, and lifestyle. Defining a specific target
market allows a company to home in on specific market factors to reach and
connect with customers through sales and marketing efforts. (Kenton, W.,
2019).
Penetrated Market
This is a set of customers or clients who are already using a particular
product or service. A penetrated market means that the potential users of
a product or service are aware of it, and in many cases are active consumers
of it (www.businessdictionary.com).
The size of a potential market helps a company understand the level
of investment it should make further in the market, while taking into
consideration other factors. If the potential market is very small, it means
there is a very small fraction of the total population showing any interest in
the product or category. This means that it is better that the company
doesn't invest further in the product or category because people won't buy it.
If the size of the potential market is large, it means that there is a huge
fraction of the total population which is showing interest in the product, so
further investment can be made on the product development or modification,
marketing, promotions etc. The size of the potential market gives an
estimate of what all a company should do and how much it should invest
(MBA Skool Team, 2018).
The Market Need
1. Need
This refers to the motivating force that compels action for its
satisfaction. Needs range from basic survival needs (common to all human
beings) satisfied by necessities, to cultural, intellectual, and social needs
(varying from place to place and age group to age group) satisfied by
necessaries (www.businessdictionary.com).
The need is a driver of human action which marketers try to identify,
emphasize, and satisfy, and around which promotional efforts are organized
(www.businessdictionary.com).
2. Market
A market is a place where two parties can gather to facilitate the
exchange of goods and services. The parties involved are usually buyers and
sellers. The market may be physical like a retail outlet, where people meet
face-to-face,
for a
physical contact between buyers and sellers (Kenton, W. & Boyle, M., 2020).
or virtual like an online market, where there is no direct
A market does not refer to a particular place but it refers to a market
commodity or commodities.
It refers to an arrangement whereby
buyers and sellers come in close contact with each other directly or
indirectly to sell and buy goods (Shaikh, S., retrieved 2020).
A market is any place where sellers of particular goods or services
can
meet with buyers of those goods and services. It creates the potential for a
transaction to take place. The buyers must have something they can offer in
exchange for the product to create a successful transaction (Moffatt, M.,
2019) Your market consists of (Stull, C., Myers, P.& Scott D.M. (2008) as
cited in: https://learn.marsdd.com/):
Existing customers: People who have already purchased your product.
Prospects: People who have not yet purchased your product but are
considering it.
Target market users: People in your target market who are not currently
looking for a solution.
Define the Market Need for Your New Business
Why is it important to clearly define market needs?
The market now demands that your business align to their needs. In
order to properly align your marketing efforts and your content, in particular
to what buyers need, you have to have a clear understanding of the many
intricacies, pains and pressures within your market. To achieve such
alignment, you need the ability to define market patterns, needs, interests,
preferences, etc. for a comprehensive view of the buying process is critical
(www.aberdeen.com).
Below are ways to define your market (Lancaster SCORE (2010):
Consider whether the business offers a new solution to an old problem
or complements an emerging trend.
Have a clear picture of your target market.
Determine the benefits that your product or service offers.
Examine industry data that can confirm whether there is a sustained,
growing demand for your product or service.
• Identify the percentage of market share that it is realistic for you to
capture.
GLOSSARY
Potential market-Is the part of the total population that has shown some
level of interest in buying a particular product or service. Potential market is
also called Total addressable market (TAM) (MBA Skool Team, 2018).
Available Market-Are prospects who are willing and capable (have sufficient
resources) buyers, and have access to a particular market or service
(www.businessdictionary.com).
Target Market. This refers to a group of potential customers to whom a
company wants to sell its products and services. Target markets are
generally categorized by age, location, income, and lifestyle (Kenton, W.,
2019).
Penetrated Market-Is a set of customers or clients who are already using a
particular product or service (www.businessdictionary.com).
Need Is a motivating force that compels action for its satisfaction. Needs
range from basic survival needs (common to all human beings) satisfied by
necessities, to cultural, intellectual, and social needs (varying from place to
place and age group to age group) satisfied by necessaries
(www.businessdictionary.com).
Market-Is a place where two parties can gather to facilitate the exchange of
goods and services (Kenton, W. & Boyle, M., 2020).
Existing customers-Are people who have already purchased your product.
Prospects-Are people who have not yet purchased your product but are
considering it.
Target market users-Are people in your target market who are not
currently looking for a solution.
To succeed as an entrepreneur, you must develop the ability to select
and offer the right products or services to your customers in a competitive
market. Ultimately, the need is the driver of every entrepreneur. Business
operators often look at the customer need as an opportunity to resolve or
contribute to the need which is providing a right product and services. More
than any other factor, your ability to make this choice will determine your
success or failure (Tracy, B., 2015).
There are thousands of products and services available to consumers
today. However, there are unlimited opportunities for you to enter the
marketplace and compete effectively with a new product or service that's
better in some way than what's already being offered by your competitors.
Remember, your skill in choosing that product or service is critical to your
success (Tracy, B., 2015).
Once you have the product or service in mind, you need to begin with a
self-analysis (Tracy, B., 2015):
1. What kind of products do you like, enjoy, consume and benefit from?
2. Do you like the product or service you are planning to sell?
3. Can you see yourself getting excited about this product or service?
4. Would you buy it and use it yourself?
5. Would you sell it to your mother, your best friend, your next-door
neighbor?
As would-be entrepreneurs, there is a need to find the right products
or services for your target market. The product or service should deliver
superior customer value (Claessens, M., 2015).
Concepts about Product and Service
A product can be defined as anything that we can offer to a market for
attention, acquisition, use or consumption that could satisfy a need or want.
However, the definition of product does not only involve tangible goods such
as a car, a fridge or a phone. The definition is extended to include intangible
objects as well, because they can be offered to a market. Therefore, the
broad definition of product includes services, events, persons, places,
organizations, or even ideas (Claessens, M., 2015).
Services are special form of product which consists of activities,
benefits or satisfactions offered for sale that are intangible and do not result
in the ownership of anything. A service can thus include banking, airline
travel, communication services, hotel services and so on (Claessens, M.,
2015)
A product is a tangible item that is put on the market for acquisition,
attention, or consumption, while a service is an intangible item, which
arises from the output of
individuals
(https://corporatefinanceinstitute.com).
one
or
more
Examples:
1. When a consumer buys a car, the product comes with a lot of other
service responsibilities, such
tune-up
and maintenance
(https://corporatefinanceinstitute.com).
as
2. A laptop buyer now buys a bundle of service benefits in addition to the
tangible components of the laptop. Specific Examples of products and
services (https://www.archives.gov)
The Difference between Product and Service
Tangible vs. Intangible
Assessing the quality of a tangible product is very easy. Since most
products are countable, touchable, and visible, a consumer can assess its
durability by examining it. A good case in point is when an individual is
buying a home. The buyer will check every nook and cranny of the house,
including the attic, basement, foundation, each individual room, and more.
In contrast, a service is not something that one can feel or try out before
paying for it. Say an individual needs a professional inspector to identify any
hidden issues before deciding to purchase a home. Just how experienced is
the inspector with regard to plumbing, roofing, and other structural
matters?
In a nutshell, the client lacks sufficient knowledge about the
inspector's expertise until the task is already in progress. The customer can
read online reviews, ask for the inspector's credentials, as well as before and
after pictures of his previous work, but there's no definite way of evaluating
the quality of a service until it's rendered.
Source: (Entrepreneurship by Feliciano Fajardo 1994)
Production vs. Interaction
A potential car buyer usually checks the car's body lines, feels the
leather used on the seats, and takes the car for a test drive before deciding
whether to buy the car or not. Since it's a product, the buyer is aware of the
specific production line the vehicle hails from, and there are many more like
it. In fact, there are other cars identical to the one being bought.
But what about the service the car buyer receives from the car dealer? The
way a car salesperson interacts with one buyer is not the same way he
interacts with another buyer. If the car buyer is lucky, he may find a
salesperson who is well-informed, courteous, and is willing to negotiate. If
he's not, the car salesperson might be one who lacks information or behaves
in a nonchalant way.
Source: (Entrepreneurship by Feliciano Fajardo 1994)
Perishable vs. Imperishable
The best way to illustrate perishable products is to consider a
restaurant owner. If such an individual does not understand the concept
of spoilage and waste reduction, he risks ruining his business since most
fresh foods spoil within a few days. Another example is technology. Even
some intangible products like software become obsolete at some point.
Imperishable products include items like jewelry and automobile parts.
However, does the distinction between perishable and imperishable exist in
services? Services can be described as perishable but not imperishable. A
perishable service simply means that it's short-lived. Ideally, such a service
is consumed as soon as it is produced. Unlike products, the service cannot
be stored for later use.
Perishable services include airline flights, auto repair, theater
entertainment, and manicures. If an individual purchases an air ticket for a
particular day, and then he suffers colds and is not able to travel, the ticket
expires. The perishable attribute of some services makes it hard to
balance supply and demand.
Source: (Entrepreneurship by Feliciano Fajardo 1994)
Identifying and Meeting Customer Needs
Customer needs are the named and unnamed needs of customers
when they come in contact with the different business establishments or
when they search for the solutions which businesses provide
(https://www.conductor.com/).
In addition, providing superior customer service means meeting
customers' needs by providing them with the products and services they
want by providing effective solutions to their problems
(https://simplifytraining.com/).
or
Similarly, innovation comes from identifying customers' needs and
providing solutions that meet those needs (Sauro, J.).
Why "Identifying Customer Needs” matter? (https://simplifytraining.com/)
1. Correctly identifying customers' needs is essential for ensuring
customer satisfaction and loyalty.
2. Customers have unique needs.
3. Often, customers either aren't clear about what they need or
they don't really know what they want.
4. Identifying clients' needs creates satisfied customers, and
satisfied customers are less likely to have reason to enter into
disputes with the organization or contemplate legal action.
Key Points (https://simplifytraining.com/)
1. To ensure customer satisfaction, entrepreneurs must correctly identify
customers' needs.
2. To identify needs, entrepreneurs must both listen and ask the right
questions.
3. After identifying needs, always check for additional or related needs.
4. As an entrepreneur, use your knowledge and experience to identify
and present the right products, services, and solutions to meet your
customers' needs.
The 7 Ps marketing mix is a marketing tool and strategy that will help your
business to develop it's marketing and business success by focusing on
specific areas. Historically, the marketing mix was just 4Ps, but 3 more were
added and it is now suggested that all 7 are considered as part of your
marketing and promotional strategy, particularly if you are a service
provider. www.multiliteraciesproject.com
What is the 7 p's marketing mix used for?
These 7 Ps are predominantly used by businesses as a focal point and as
part of an overall marketing strategy.
They can assist with:
Defining areas of success in the business that can be replicated and
built on
Defining issues in the business that are holding you back from being
more profitable, productive or successful
Setting objectives and targets - so you can move strategically towards
your goals
Competitive analysis - your business position in the market against
your competitors
SWOT analysis analysis of your business strengths, weaknesses,
opportunities and threats
https://economictimes.indiatimes.com/definition/marketing-mix
The 7 Ps
The original 4Ps of the marketing mix tool are:
1. Product
2. Price
3. Place
4. Promotion
The additional 3Ps added, are:
5. People
6. Process
7. Physical Evidence
Using the 7Ps
You can use the 7 Ps as headings for discussion, of which the findings and
conclusions can then be added to your marketing strategy, which should
feature as part of your overall business plan.
Some of the things you can focus on under each of the 7P headings, include:
PRODUCT - this could be your SERVICE if you are a service provider
Is your product branded effectively?
How do your customers rate the quality of your product?
Is there recurrent negative feedback about the same thing?
Are there improvements that could be made?
Is your product brand strong?
Do you offer a guarantee?
Do you have availability or stock?
Could you take on more customers or orders?
PRICE
How does your product compare when it comes to the market price?
When was the last time you reviewed your pricing?
When was the last time you altered your price in-line with inflation, or
market supply and demand?
Is your pricing model clear and easy to communicate?
Do
you know your profit margin on each product you offer?
Do
you provide any added-value to your offering?
Do
you
offer the most appropriate payment methods for the customer?
Do
you
offer credit facilities?
PROMOTION
What marketing communications do you have?
Do they need updating?
Do they give the right messages?
How could you refine your sales process?
What PR activity are you doing?
Do you have a marketing budget? Should it stay the same, or change
this year?
Do you network to promote your business?
PLACE
Is your product available in the place where your customers shop?
Is your product visible to your target market?
Are
you visible on social media?
PEOPLE
Do you have the right people to sell your product / service?
Do
you have the right amount of marketing support?
Are the right people in your team, in the right roles?
Do you need more, or less resources?
Could you outsource some of your work to reduce commitment on
costs?
Do you have the right culture within the team?
Do you have a good recruitment, training and appraisal system for
staff?
PROCESS
Is your sales process efficient?
Are your processes customer focused?
Do you have a good process for dealing with technology issues?
Have you established systems for as many things as possible within
your marketing and sales process?
PHYSICAL EVIDENCE
Is your product packaging reflective of the quality of the product?
This could apply to the way a service is delivered, including any physical
documentation
What is the online experience if the product is delivered digitally?
These are just ideas and you will for sure come across other questions and
thoughts that are relevant to your business.
Why not get your team together (or you partner / best friend if you are a sole
trader) and have some fun by trying to really cover all the individual
elements of your business. Be constructively critical and also realistic with
what you can achieve within certain timeframes.
Why the marketing mix is still used from the 80s until now
The marketing mix concept may seem dated as it was developed in the
1980s and we now live and work in a rapidly changing commercial
environment.
However, it remains effective as the logic behind each of the 7 Ps remains
constant yet they are flexible enough to be able to be adapted to suit the
new style of communications, for example social media.