Session 1 - FEM11028 - 26102020 - HO

26-10-2020
FEM11028: Seminar
Strategic Marketing
Session 1: Welcome & Intro to the Course
Nuno Camacho & Paniz Gorji
Monday, October 26th, 2020
Our Sessions: Zoom

1. Side by side mode
2. Free to speak (hand raising if needed)
3. Muted when not speaking (tip: space bar)
4. Chat will also be monitored, especially in full sessions like today (all students).
5. We are all learning & things fail
FEM11028 - Seminar Strategic Marketing 2020/21 2
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Session 1: Let’s Get Started

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Course Philosophy: Flipped Classroom
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Course Philosophy: Learning by Doing
Course Philosophy: TEAMWORK
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Course Philosophy: Healthy Competition
Today…
Course Goals and Intro to StratSim Short Q&A (Course Logistics; Grading)
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Today…
Three Key Goals of our Course
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LEARN AND
1 PRACTICE
MARKETING
STRATEGY
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The StratSim Simulation

Read the manual carefully Explore the simulation: Learn about your company,
experiment with buying the research tools and see what
decisions you need to input
(you should already have login details; otherwise please text us or email us)
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The StratSim Simulation
You are the You will decide on

management team of You will make short new product
an automotive and long-term launches, pricing,
company, in an industry decisions over 8 R&D investments,
with 5 companies simulated years advertising, …
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The StratSim Simulation: Market Description

• Based on the Automobile Industry
• Two Markets: Consumer & Fleet (B2B)
• Consumer market of 150 million people
• B2B market of numerous fleet contracts
• Currently, low GDP and inflation growth rates

• Demand sensitive to GDP, interest rates, and decisions that
you make as an industry
• 8 rounds (+ 2 prac. rounds…)
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• 7 Product Classes with Existing Vehicles:
(E)conomy, (F)amily, (S)ports, (L)uxury,

(M)inivan, (U)tility, and (T)ruck
• Plus two potential new classes if developed:
(A)lternative Energy Vehicle & (D)elivery
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• Competitors: 5 firms (A-E)
• Each firm has 3 vehicles on the market
• Amazing Cars (A) → Alfa (F), Alec (E), Awesome (U)

• Best Motor Works (B) → Boffo (F), Beaut (L), Buzzy (S)
• Cool Cars (C) → Cafav (F), Camini (M), Climax (L)
• Driven Motor Co. (D) → Defy (F), Delite (E), Detonka (T)
• Efficient Motors (E) → Efizz (F), Estruck (T), Euro (U)
• The firms have different strengths and weaknesses and

are uniquely positioned in the market
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The StratSim Simulation: Customer Behavior
B2C: Purchase Process

• Customers have different needs and expectations
regarding vehicles
• Customer “consideration set” based
on product class, size, and MSRP
• Hint: “hot buttons”!!
B2B: Purchase Process

• Fleet buyers: Rentals (6), Delivery (7), Government/other (8)
• Contractual purchasing (professional, rational decisions)
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StratSim: Firm Objectives (Your Goals)
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Jeff Bezos…
“If everything you do needs to

work on a three-year time
horizon, you’re competing
against a lot of people. But if
you’re willing to invest on a
seven-year time horizon,
you’re now competing against
a fraction of those people,
because very few companies
are willing to do that.”
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Jeff Bezos…
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Investors…
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Investors…
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Your Goals…
Maximize Profits Maximize Stock Price
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Your Goals…
Profit = Sales Qty x Unit Margin – F.C.

Net Income Sales ($) Costs ($)
(Demand x Share) x (Sell. Price – COGS) –

F.C.
- Economy - “Quality” - R&D
(MSRP - %) -“Quality”
- Industry - Relative $Ad - Capacity
- Value - Tech Cap.
Dynamics - Price -Tech
- Price Volume
(products, adv$, - Distribution - Distrib.
Sensitivity Upgrade
etc.) - Preference - Adv
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EVIDENCE-
2 BASED
DECISION-
MAKING
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Part 2: Success = The Right Evidence
Set Strategy
• Customer • Effect of
• Competition Strategy
• Company • Products Implementation
• Innovation
• Strategic
Gather alignment Gather
Exploratory Confirmatory
Evidence Evidence
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Step 1: Gather Exploratory Evidence
Set Strategy
• Innovation
• Strategic
Evidence Evidence
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Step 1: Gather Exploratory Evidence
Customer Competition Company
Who are our What is our How do we

current unique selling serve our
customers? proposition? customers?
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Customers: Who are they?

• A critical aspect in market strategy is to segment the market and
carefully choose your target segment(s):
C1 C5
C C3
C C2
C C1
C C6 C2 C3 C6
C C5
C C4
C C7 C4 C7
THE OVERALL …IS BROKEN …AND REGROUPED BASED ON

MARKET… DOWN… CUSTOMER SIMILARITY
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• 5 consumer segments (1-5) with different needs and class preferences
• Microsegment = Intersection of segment and class
(e.g., 1T is a value seeker who wants a truck)
Segments Microsegments
Value Seekers (1) 1E, 1T
Families (2) 2E, 2F, 2M
Singles (3) 3S, 3T, 3U
High Income (4) 4F, 4L
Enterprisers (5) 5L, 5U
… New microsegments may emerge
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1T
94,000 Units*
Detonka
3T
221,000 Units*
*Sales by Customer of Detonka

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Competition: Your Unique Selling Proposition?
Focus Group Conjoint Analysis Perceptual Map
What is our How much do How close are we to

USP? customers care the customer’s ideal
about our USP? point?
How does our current USP drive our strategy?
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Company: Where Can We Win?
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Company: Where Will Growth Come From?
Existing Customers New Customers
Family Truck
Where is the gap in the market?
Economy
Which customer fits our

company best?
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Step 2: Set Strategy
Set Strategy
• Innovation
• Strategic
Evidence Evidence
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Product Strategy
How will you optimize the pricing of your current cars?

Pricing? Dealers & Dealer Discounts?
Which customer hot buttons will you focus on?

How to ensure a consistent advertising theme across cars?
With what advertising and promotion intensity do you

want to market our cars?
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Innovation Strategy
How and when will you upgrade our cars to reach your target customers?
Which features will improve and focus on?
How will you translate customer needs into new products or upgrades?
Will you focus on radical or incremental innovations? What consequences does that bring to your
company (e.g., tech capabilities, R&D development centers, etc)?
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Innovation Strategy
New
Customers ? ?
Existing
Customers ?
Existing New
Vehicles Vehicles
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Strategic Alignment
How will you align and optimize various functional areas in support of your product and
innovation strategy?
Specifically, how will you set and finance your operations?
What about channels? How will you reach your customers?
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Strategic Alignment
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Strategic Alignment: Channels
How much coverage of the market do we want?
How much support through training do we want to provide?
What type of discount will we provide (profit sharing)?
Should we add dealers to support new cars in our portfolio?
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Step 3: Gather Confirmatory Evidence
Set Strategy
• Innovation
• Strategic
Evidence Evidence
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Monitoring Your Strategy
What KPI’s Will You Monitor?
What Happened as Expected?
What Was Unexpected? Why?
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Scenario Thinking: What Happens if I Implement

“Strategy A”? And “Strategy B”?
Conjoint Analysis Concept Test | Test Market
How much utility do What is the contribution

customers gain? to our profitability?
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3 SOFT SKILLS &

TEAMWORK
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Setting a Strategy: TEAM
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How do you set a strategy as a TEAM?
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Distribution of responsibilities is crucial to success!
• Who coordinates the actions to be taken and

warrants focus on the long-term strategy?
• Who organizes the product portfolio? NPD? And

manufacturing?
• Who monitors consumer needs?
• Who oversees marketing research decisions? And

the marketing mix optimization?
Note: Everyone on the same team shares ONE decision file, so when one person makes a change, the whole team makes that change (same for tools).
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TEAM = Solving Disagreements
You Will Need To Solve

Your Disagreements.
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TEAM = Supporting Each Other
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TEAM = Clear Roles; Joint Responsibility

• Play as a team
• Persuade and reach consensus
• Your team’s decision-making process
is key for successful decisions
• Important to have a clear role
division and efficient team structure
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Our Role…
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Recap: From Goals to Learnings…
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Recap: From Goals to Learnings…
#1 #2 #3 #4 #5
Balancing the Deciding how much Understanding the Using tools for fact- Working as a team,
short-term vs. long- to invest, when & relationship between based decision dividing roles and
term (net income which new products different parts of the making & balancing convincing others of
vs. stock price) to develop company facts with intuition your choices
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5’ Break?
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Today…
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StratSim Teams
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Hint: First Meeting with Your Team

→ (Re-)do the SWOT as a TEAM
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→ Structure Your Team
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→ Structure Your Team
▪ Innovation
▪ Technology
▪ Product Development Function
▪ Marketing Name
▪ Consumer Marketing Decision Areas
▪ Corporate Marketing
▪ Operations
▪ Manufacturing
▪ Distribution
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Case Groups (Attention: Not the same…)
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26-10-2020
Course Structure
Teaching Methods
Short StratSim Weekly

Intro Outside-In Team and Pitching and
Discussion Teamwork + Readings
Lectures Lectures Individual Presenting
Sessions Coaching (Canvas)
Sessions Assignments
Support Platforms
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Course Grading
Component Points
▪ StratSim Report 1: Situation Analysis (individual) 10
▪ StratSim Report 2: Strategic Marketing Plan (Stratsim group) 15
▪ StratSim Report 3: Post-Mortem Report (Stratsim group) 15
▪ StratSim Performance (Stratsim group) 15
▪ Case Memo 1: Strategic Marketing in a Post-Covid19 World (case group) 15
▪ Case Memo 2: Veniam (case group) 15
▪ Class Participation (individual) 15
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StratSim Performance
𝐶𝑁𝐼𝑖𝑗,𝑇 𝑆𝑃𝑖𝑗,𝑇
Stratsim Performanceij,T = 0.5 ⋅ + 0.5 ⋅ ⋅ 10
max 𝐶𝑁𝐼𝑖𝑗,𝑇 𝑗=1,...,5
max 𝑆𝑃𝑖𝑗,𝑇 𝑗=1,...,5
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Participation (Individual)
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26-10-2020
Deliverables
01 02 03 04 05
StratSim Report 1 Veniam StratSim Report 2 Strategic Marketing in StratSim Report 3

Situation Analysis Case Memo 1 Strategic Mkt Plan a Post-Covid19 World Post-Mortem
(Individual) (Case group) (StratSim Group) Case Memo 2 (StratSim Group)
(Case group)
Before 18.00 on PPT before 18.00 on Before 18.00 on Before 18.00 on Before 18.00 on
Friday, 30/10/2020 Monday, 09/11/2020 Monday, 16/11/2020 Friday, 20/11/2020 Friday, 11/12/2020
+
Pitch on session
12/11/2020
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First Deliverable: This Friday
01 02 03 04 05
StratSim Report 1
Situation Analysis
(Individual)
Before 18.00 on
Friday, 30/10/2020
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26-10-2020
First Deliverable: This Friday

1 Internal Analysis
Firm Analysis Strengths & Weaknesses
2 External Analysis
Customer Analysis Competitive Analysis Opportunities & Threats
3 Your Role in the Team
Role Division
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26-10-2020

Our Sessions: Zoom

FEM11028 - Seminar Strategic Marketing 2020/21 2

Session 1: Let’s Get Started

Course Philosophy: Flipped Classroom

FEM11028 - Seminar Strategic Marketing 2020/21 4

Course Philosophy: Learning by Doing

FEM11028 - Seminar Strategic Marketing 2020/21 5

Course Philosophy: TEAMWORK

FEM11028 - Seminar Strategic Marketing 2020/21 6

Course Philosophy: Healthy Competition

FEM11028 - Seminar Strategic Marketing 2020/21 7

FEM11028 - Seminar Strategic Marketing 2020/21 8

FEM11028 - Seminar Strategic Marketing 2020/21 9

Three Key Goals of our Course

FEM11028 - Seminar Strategic Marketing 2020/21 10

The StratSim Simulation

FEM11028 - Seminar Strategic Marketing 2020/21 12

The StratSim Simulation

You are the You will decide on

FEM11028 - Seminar Strategic Marketing 2020/21 13

The StratSim Simulation: Market Description

• Currently, low GDP and inflation growth rates

The StratSim Simulation: Market Description

(E)conomy, (F)amily, (S)ports, (L)uxury,

• Plus two potential new classes if developed:

(A)lternative Energy Vehicle & (D)elivery

FEM11028 - Seminar Strategic Marketing 2020/21 15

The StratSim Simulation: Market Description

• Amazing Cars (A) → Alfa (F), Alec (E), Awesome (U)

• The firms have different strengths and weaknesses and

FEM11028 - Seminar Strategic Marketing 2020/21 16

The StratSim Simulation: Customer Behavior

B2C: Purchase Process

B2B: Purchase Process

FEM11028 - Seminar Strategic Marketing 2020/21 17

StratSim: Firm Objectives (Your Goals)

FEM11028 - Seminar Strategic Marketing 2020/21 18

“If everything you do needs to

FEM11028 - Seminar Strategic Marketing 2020/21 19

FEM11028 - Seminar Strategic Marketing 2020/21 20

FEM11028 - Seminar Strategic Marketing 2020/21 21

FEM11028 - Seminar Strategic Marketing 2020/21 22

Maximize Profits Maximize Stock Price

FEM11028 - Seminar Strategic Marketing 2020/21 23

Profit = Sales Qty x Unit Margin – F.C.

(Demand x Share) x (Sell. Price – COGS) –

FEM11028 - Seminar Strategic Marketing 2020/21 24

Part 2: Success = The Right Evidence

FEM11028 - Seminar Strategic Marketing 2020/21 26

Step 1: Gather Exploratory Evidence

FEM11028 - Seminar Strategic Marketing 2020/21 27

Step 1: Gather Exploratory Evidence

Customer Competition Company

Who are our What is our How do we

FEM11028 - Seminar Strategic Marketing 2020/21 28

Customers: Who are they?

THE OVERALL …IS BROKEN …AND REGROUPED BASED ON

FEM11028 - Seminar Strategic Marketing 2020/21 29

Customers: Who are they?