ADMS 2200 Midterm Review
3 questions
- 1 & 2: one of the five concepts, 25% each
- 3: Case- apply concepts to case/problem, 50%
Concepts:
1.
2.
3.
4.
5.
Competitive advantage (week 2 slides, Porter’s concept)
 Cost leadership
 Differentiation
 Focus
 Stuck in the middle
Boston Consulting Group
 Text book
Core competence
 Week 3 slides
 Different skills
 Technology (i.e. Sony)
Forms of research (observation, survey, focus group)
 Only those 3 forms will be tested
Consumer buying behaviour (motivation, perception)
 Text book
Competitive Advantage
1. Cost leadership
- Low prices to consumers
- Economies of scale
- High sales volume
- Example: Wal-Mart
2. Differentiation
- High standards/quality/reputation
- Example: Mercedes Benz
3. Focus
- Strong focus on customers
- Cut costs to offer lowest price
- Example: West Jet
Boston Consulting Group
STAR:
-
High growth
High share
Require heavy investment
Rapid growth
When growth slows, turns into cash cow
Example: iPhone
CASH COW:
-
Low growth
High share business units
Established
Successful
Require less investment than stars
Produce the cash to fund/support other units
Example: Tide (P&G)
QUESTION MARK:
-
Low share business units in high growth markets
Require heavy investment to hold market share
Sometimes can be built into stars
Could be phased out
DOGS:
-
Low growth
Low share business units
Generate enough revenue to maintain themselves
Do not promise to be large sources of cash
CORE COMPETENCE
-
The collective learning in the organization, especially how to coordinate diverse production skills
and integrate multiple streams of technologies
1. Innovation
2. Stop duplication from competitors
- Examples:
o Sony
 Tv
 Camera
 Phones
 Games
o Canon
 Optics
 Imaging
 Microprocessor
o Honda (knowledge based)
 Combustion engineering
 Electronic engine management systems
 Advanced materials
o GM (product based approach)
 Trucks
 Vans
 Cars
 Combining skills/technology to create innovative products that cannot be duplicated
o Companies such as Sony, that have many different types of products and experts (TVs,
music, games, phones etc) can combine their skills/tech to compete with others
 Ex. Sony’s ‘game’ phone, music phones etc (combining cell phones with another
aspect in which they excel)
FORMS OF RESEARCH (OBSERVATION, SURVEY, FOCUS GROUP)
 Observation: The gathering of primary data by observing relevant people, actions, and
situations
o Examples:
 Kimberly-Clark giving consumers ‘camera glasses’ to observe behaviour to
modify and improve baby products (Huggies)
 Neilsen Media Research -> TV habits
 Computerized cash registers to collect primary data (purchasing behaviour)
 Survey research: the gathering of primary data by asking people questions about their
knowledge, attitudes, preferences, and buying behaviour
o Most widely used method for primary data
o Best suited for gathering descriptive data
o Advantage- flexibility
o Mail in, telephone, in person(expensive)
o Important to be aware of questions asked
o Use a large enough sample size to account for biases, lies, etc
 Focus Group: a moderated, small group discussion, typically conducted by marketers during the
new product development process.
o Qualitative data
o Small group of people chosen as reps for target market
o Moderators, marketers watch behind 2-way mirrors
o Good for gaining insight
o Con: expensive
o New way: direct consumer-marketer ‘meetings’
o Schick: ‘slow sip’ meetings of women in a comfortable, casual setting (coffee house) to
discuss shaving, moisturizing etctypically uncomfortable topics
Consumer Buying Behaviour
Marketing and other stimulibuyer’s black boxbuyer response
 Motivation: a need that is sufficiently pressing to direct the person to seek satisfaction of the
need
o Stimulation (i.e special price/promotion) driveidentification of goal directed
behaviour behaviour (approach vs. avoidance)outcome
 Perception: the process by which people select, organize, and interpret information to form a
meaningful picture of the world
o Select
o Organize
o Interpret
o Selective attention
o Selective distortion
o Selective retention
 Perceptual threshold
o The minimum level of magnitude at which a stimulus begins to be sensed
 Perception
o Reference price
o Quality cue
o Country of origin effects
 Four outcomes:
o Ideal business: high in opportunity and low in threats
o Speculative business: high in both opportunity and threats
o Mature business: low in both opportunity and threats
o Troubled business: low in opportunity and high in threats