COEUR - BCM Business Creativity Module

Entrepreneurial Marketing Strategy

Andrew Turnbull

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

European Dimension

enthusiastic committed professional visionary 'hungry open minded

...

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 is creative, innovative, open for the unconventional The Marketer 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:
How best to leverage limited resources to help the company grow?

Marketing Challenge:
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

Competitors

manage processes
show leadership

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 new
Market Development

Products

Product new Development Diversification

Entrepreneurial Marketing Strategy

2.1) Defining the Offer: SWOT Analysis

favourable unfavourable

Strengths
internal

Weaknesses

Opportunities
external

Threats

Entrepreneurial Marketing Strategy

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) Whats In It For Me? Customer Benefit Definition

product feature extended opening hours customer loyalty card eco-certified products

generic benefit convenience savings

meaning to customer freedom 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
sales volume maximization

sense-and-respond
customer value maximization

branding, advertising, distribution partners

packaged goods

personal selling, direct and database marketing

individual services

one-time customer
high market share

lifetime customer
stable relationships

Entrepreneurial Marketing Strategy

3) Defining the Market Customer Profiling

Transactional Marketing: Relational Marketing:

Who is your typical customer?

Build a demographic portrait: Age bracket, cohort Family life cycle stage Education, occupation Disposable income/month Usage pattern ...

How does your typical customer interact with you?

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

D e c lin e

time

Entrepreneurial Marketing Strategy

4) Timing the Entry Into the Market Product/Market Life Cycle

Introduction Growth Maturity Decline

New customers Main marketing problem

Q:

former non-buyers

How can Marketing Strategy adapt to different Cycle Phases ? raising making Life differentiaretreat from
awareness, getting known Promotion product available Place Trendiness tion from competitors Product, Promotion market

competitors customers

Main instruments

Price

Spin on USP Newness

Distinctness Reliability

Entrepreneurial Marketing Strategy

4) Timing the Entry Into the Market First Move Considerations

First Mover Advantages Primacy effect: Making an early and lasting effect on customers Investments into the market (e.g.: distribution network, consumer awareness) will pay off early. First mover can start to build experience early, increase the lead and solidify the strategic position First Mover Disadvantages

Recency effect: Followers have benefit of newness

Competitors free rider effect; investments may turn out to be exit barriers if/when market declines 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 and Positioning Marketing against mainstreaming ... New Ideas
Competitors Differentiation Making them acceptable to customers

Entrepreneurial Marketing Strategy