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STRATEGY IMPLEMENTATION. Market segmentation:subdividing of market into distinct subsets of customers according to needs and buying habits Product positioning: identifying what customers want and expect and how competitors are behaving and a company should position itself.
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STRATEGY IMPLEMENTATION • Market segmentation:subdividing of market into distinct subsets of customers according to needs and buying habits • Product positioning: identifying what customers want and expect and how competitors are behaving and a company should position itself. Centrally important to Implementation is decision on how to market
Marketing Issues Geographic Demographic Market SegmentBasis Psychographic Behavioral
Product positioning • Involves understanding wants and needs from a customer perspective • Assess how competitors are positioned in their ability to fulfill these needs • Identify a gap to exploit
Product Positioning Steps 1. Select Key Criteria 2. Diagram Map Product Positioning Steps • Plot competitors’ • products 4. Look for niches 5. Develop Marketing Plan
Product Positioning Map High quality Mercedes BMW Honda Hyundai High price Low price Kia Perodua Naza Proton Low quality
Finance/Accounting Issues • Acquiring needed capital: trade-off between debt and equity • Developing projected financial statements • Preparing financial budgets • Evaluating worth of a business Essential for implementation
COMBINE LOAN S500K AND STOCK 10K ISSUE COMMON STOCK (20K) LOAN $1M
Factors to consider in decision • Extent of control dilution • Interest rate • Share price • Less share dilution if price is high • More share dilution if price is low • Amount of funds needed • Future financial requirements
Finance/Accounting Issues Evaluating Worth of a Business: Three Basic Approaches • What a firm owns: value of stockholders’ equity • What a firm earns: net income x 5 • What a firm will bring in the market: • a) price-earning ratio method • b) outstanding shares method
WHAT YOU SHOULD HAVE UNDERSTOOD? • KEY MARKETING ISSUES IN THE STRATEGY IMPLEMENTATION STAGE • HOW TO PERFORMANCE PRODUCT POSITIONING ANALYSIS? • KEY CONSIDERATIONS IN DECIDING FUNDING DECISION • HOW TO DETERMINE THE NET WORTH OF COMPANIES?