Looking at the competition is required however, these observations do not need to serve as the "end all be all" to a companies marketing strategy. Yes, they serve as an important tool in a marketing strategy but they do not dictate the entire strategy. A marketing strategy can be a wonderful example of a method that strikes a balance between facts and the companies "gut", the key word being CAN. If a company focuses solely on the competitor analysis it may become focus and one again "paint itself into a conrner'. Having a diverse marketing strategy that encompasses internal and external factors will help any company be competitive.
Q: "Who defines the competition? "
A: "Oh, I know!! Is it the customer?"
"Correct!", Drucker has a funny way of drilling it into our heads that the customer is responsible for everything. My favorite Drucker line so far has been "There is only one valid purpose for a business, and that is to create a customer". If a business creates a customer then that customer dictates who the competition will be based on the customers needs and wants. For example: your a business who wants to sell a vacuum. The first part once the product is in place is to define/create the customer. In this example the customer is middle aged women. Now that the customer is defined the competition has also been defined. The competition is anyone and thing marketing to the same customer with the potential to offer the same good you are.
**********************************************
Traveling through direct and indirect competition
I work for the insurance company Travelers. Yea, the red umbrella company!
Insurance is a complex beast with many competitors.
Our direct compeitiors would be those companies that offer the same service as we do such as other Health, Auto and Liability Insurance companies such as: Aetna, Liberty Mutual and the Hartford. These competitors are easily identified as they are heavily promoted in print and media ads.
The not so easily identified competitors to our health insurance line are health providers, nutritionist and personal trainers. As long as these sources exist and promote well being they pose a threat to our business.
Our Auto line indirect competitors are car makers, drivers education and in some cases traffic laws.
************************************************
Is it ethical? In the class Organizational Behavior we discussed tests for ethical behavior. My favorite test is "The front on the newspaper" test. In summary, when making a decision and you aren't sure if its ethical or not, you imagine the decision on the front page of tomorrow's newspaper. If the headline is something that you are comfortable with people outside your firm knowing then it is considered ethical.
The two examples given in the lecture can be applied to this test.
1. Using an ex-coworkers password to obtain competitors secrets.
HEADLINE: Business X steals password to gain insight on Business Y.
2. Hiring a executive from a competitor.
HEADLINE: MR. X has recently accepted a promotion with Business X.
This test can be used for any decision.
***************************************
This week on PharamaSim-
Please tune in to find the importance of Sales force Reports:
What is a Sales Force? A sales force is made up of customer relation management (CRM). "Those who do the selling". A sales force report will decipher how well theses CRM are accomplishing their job. By setting targets and goals a report can be put together to depict the success or failure to reach these goals.
Why is this important? The sales force has direct contact with the customer. If they aren't preforming well then the customer may be lost. It is important as Drucker always states that the customer needs to come first and the sales force report will be able to tell a company if the CRM needs to change or not.
**************************************
Lots of people living in the Pharmasim world approximately 263.9 million.
My favourite ethical test is also "the front of newspaper" test and I also learned it in the MBA program. I feel like it is a very easy test to apply. During the class discussion of companies being in the grey area when looking at competitors, I immediately thought of this ethical test. Anything companies do today is instantly on the "newspaper" via facebook, tweeter, or other social media. That being said, companies who are close to the grey area when examining companies know that this information is public. Information such as hiring a former executive happens many times and customers are aware.
ReplyDeleteThanks for the good tips regarding the Sales Force information in PharmaSim. It is helpful in learning more about the customer and how the organization should adapt in pleasing the customer. The CRM is a vital piece in satisfying the customer's needs.