... while paint made up just 15% of costs. Armed with this insight, the resin maker emphasized that its product dried so fast that contractors could apply two coats in one day—substantially lowering labor costs. Customers snapped up the product—and happily shelled out a 40% price premium for it. To craft compelling customer value propositions: UNDERSTAND CUSTOMERS’ BUSINESSES Invest time and effort to understand your customers’ businesses and identify their unique requirements and preferences. Example: The resin manufacturer deepened its understanding of key customers in several ways. It enrolled managers in courses on how painting contractors estimate jobs. It conducted focus groups and field tests to study products’ performance on crucial criteria. It also asked customers to identify performance trade-offs they were willing to make and to indicate their willingness to pay for paints that delivered enhanced performance. And it stayed current on customer needs by joining industry associations composed of key customer segments. SUBSTANTIATE YOUR VALUE CLAIMS “We can save you money!” won’t cut it as a customer value proposition. Back up this claim in accessible, persuasive language that describes the differences between your offerings and rivals’ that matter most to customers. And explain how those differences translate into monetary worth for customers. Example: Rockwell Automation precisely calculated cost savings from reduced power usage that...
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...The theory of Value Proposition indicates that a target market's valuation of a product can be derived by analyzing the benefits of that product to the target market and weighing the costs of choosing that product. To examine the benefits, one must review both the points of parity, features of a product that are the same as the competition or next best alternative, and the points of difference, features of a product that are superior to the next best alternative (Mgmt 205 Course Reader, pg 17 "Customer Value Propositions in Business Markets). For this analysis of Wyndham International Corporation's ByRequest value proposition, it can be argued that Marriott Hotels and Resorts and it's Marriott Rewards points program is the next best alternative to a potential Wyndham guest due to statistics that indicate that Marriott Hotels and Resorts had the highest occupancy rates in the surveyed years 1997-2001 (Case Exhibit 5) and had the highest percentage of people with incomes exceeding $50,000 per year who preferred the Marriott brand over hotel/motel brands in 2000 and 2002 (Case Exhibit 6). Also, the target market can be defined as "the average upscale traveler who, on average, takes 12 to 14 trips a year", corporate travelers in particular (Case Page 13), as it is the business traveler who usually is the primary decision maker for business trips (Case Exhibit 6). The point of parity between Wyndham's ByRequest program and the Marriott Rewards program is that both reward guests...
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...up for Missed Class Case: Customer Value Propositions in Business Markets Basic Case Identification Who is/are protagonist(s) or decision maker(s)? Companies that offer a service product to a customer What is the primary decision that must be made? What constitutes a customer value proposition and what makes one persuasive to the customer? Primary Alternatives to Consider for Value Propositions 1) All Benefits - preferred by most managers; - list all the products benefits; - requests the least knowledge about customers and competitors; - negative: benefit assertion (features may have no value for the customer, not knowing anything about the customer or competition may have as an effect missing the points that make the differentiation from the competition and for the customer); 2) Favorable points of benefits – recognizes the existence of the alternative - requires to know the differences between own product and next best alternative and the customer’s requirements; - drawback: value presumption (assumed points of difference may have no value for the customer); 3) Resonating focus- the most valuable - requires a complete understanding of the customer needs and how you can fulfill this through features that are superior to the customer’s offering; - requires extensive research. Ways to substantiate the customer value value word equations: expresses in words and simple...
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...MAR6930 Team Assignment 1 Profile Lieutenant Mark Johnson is a 33 year old naval officer who has spent the last ten years flying the F/A-18 Super Hornet. He has been married to his wife Susan for seven years; together, they have two daughters, Jane and Jill, and another child due in the summer of 2014. Mark is originally from Milwaukee, Wisconsin, but has moved eight times in the past ten years because of the demands of his career. Mark and his family currently live in Lansing, Kansas. In addition to pursuing his MBA at the University of Chicago, he is also attending the U.S. Army Command and General Staff College. His prior education includes a Bachelor of Science in Systems Engineering from the United States Naval Academy. When he is not spending time with his family, flying, or studying, Mark enjoys following sports, especially the New York Yankees and the Green Bay Packers. He’s also an avid woodworker, skier, guitarist, and enjoys world travel, whether it be with the Navy or just for pleasure. This past fall, he took part in the University of Chicago Global Immersion Experience that visited Peru. After ten years of naval service, which included deployments, extensive travel, and a generally fast-paced lifestyle, Mark is finally at a point in his career that allows for more down time, which he believes is an ideal opportunity to further his education. He plans to spend another 10 years in the Navy, reach full military retirement, and then pursue to a career...
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...NETWORKS Facebook acquired QuickFire Networks on 8th of January 2015, QuickFire Networks built a custom hardware and software platform which reduces video file sizes and upload times. The acquisition further lays emphasis on the social networking giant’s focus on video. QuickFire in its website before the acquisition said, “QuickFire Networks will provide you with the weapons necessary to meet the onslaught of the video revolution,” QuickFire uses proprietary technology to reduce the bandwidth needed to view the video online without affecting the quality of the video as the current network infrastructure is not sufficient to support the massive viewing of videos online which averages over 1 billion videos per day for Facebook. VALUE PROPOSITION USERS : Facebook’s users post and view and share videos on facebook by linking to videos from other sites like youtube. The videos viewed online on facebook averages over 1 billion videos per day. NEED: The time it takes to buffer videos depends on the quality of the video and the size, compressing the videos without degradation in quality reduces the buffering time. Users can upload video directly to its site, instead of linking to videos on other sites like Youtube which keeps the users on the service of facebook. Facebook gets more control over how the videos can be viewed and can be placed around advertising. PRICE: As QuickFire compresses the videos without affecting the quality of the video, the buffering time is reduced...
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...Explain the Employee Value Proposition, the components and its relevance to developing Competitive Pay Programs. Employee Value Proposition (EVP) is a term used to denote the balance of the rewards and benefits that are received by employee in return for their performance at the workplace.An EVP describes the mix of characteristics, benefits and ways of working in an organization. It is the deal struck between an organization and employee in return for their contribution and performance this “deal” characteristics an employer and differentiates it from its competition Why is an EVP impotant? An effective EVP can bring an organization significant benefits. According to the Corporate Leadership Council’s research a well thought through and executed EVP can : - Improve the commitment of new hires by up to 29% - Reduce new hire compensation premiums by up to 50% - Increase the likelihood of employees acting as advocates from an average of 24% to 47% In addition an effective EVP allows organizations to source more deeply within the labor market, increasing its access to passive candidates. This is important for organizations who want to secure the best talent in an increasingly difficult talent market. What EVP revevance to developing Competitive Pay Programs Helps you to attract and retain talent A clear and differentiated EVP ensures that you attract and retain people that you would inevitably lose to other organizations with more attractive EVPs. Helps you to...
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...“various games that involved pretending” (240). a. As kids make up these “principles of generation” (244) that transforms otherwise ordinary objects into “props” (243), and from these come “fictional truths” (243) that they let themselves “imagine” (245) and find pleasure in experiencing this alternate world, so is the process that undergoes when experiencing art. 2. A “fictional truth” is a proposition that is “true in some fictional world or the other” (243). a. A fictional truth is different from an “imagining” (244) in such a way that these fictional truths are “true” in the fictional world that one subjects himself to, whether or not he imagines them to be “true” (244). b. A proposition is then said to be “fictional” if it holds as real in the make-believe world. 3. A “fictional truth” is conjured from a prop and the principle of generation. a. The principle of generation is the “certain convention, understanding, [and] agreement in the game of make-believe” (244), which turn objects into props, “generators of fictional truths, that which make propositions fictional” (244). 4. Props are established by principles of generation, regardless of the observer’s active imagining of them as something else in make-believe. That which prompts imagination, moreover, may not be a prop as there exists no principle that establishes them as a prop (245). 5. Works of art are representations, meaning, they are made “specifically for the purpose of being used...
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...that has questioned whether it is relevant in practice. We will look at the theoretical result to illustrate what it does or does not show and look at the empirical relevance. The key aspect of rate of return regulation is that the principal restriction on the regulated firm is that the rate of return it can earn on capital is restricted to a value s. In order for the firm to be able to finance its operations, secure funds for its investments, the firm has to be able to earn a return equivalent to its cost of capital r. As it is difficult to determine the exact cost of capital and there is a hard constraint that the permitted rate of return should not be less that r the permitted rate s will typically be above r. The usual (and somewhat misleading) statement of the Averch Johnson result is that because s > r there is an incentive for the firm to overinvest in capital to earn higher absolute values of profit. This can lead to a number of conclusions (some true some false). These can be characterised as. Proposition 1 The input choice chosen by the firm subject to rate of return regulation will not be the cost minimising choice.[TRUE] 1 Proposition 2 The...
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..."Google is the search engine of the world" The above statement is one of the most recognised value propositions in the world. Anyone associating themselves with Google instantly identify with this. Why is this? Value is not limited to products and services Every day, Google is constantly bringing in something new to the market, something unique, something accessible. Providing cost reduction techniques to suppliers, access to databases for research purposes to Universities, giving customer’s weather updates etc. Value not limited to Customers Google’s value recipients also include suppliers, government bodies, universities and local communities. The most interesting recipient specified are the employees of Google. The value created for them include job security, flexible working hours etc. Value proposition not tied to Source of Revenues “An investment in knowledge pays the best interest” - Benjamin Franklin The fundamental strategic process that Google follows is knowledge acquisition. Getting access to new assets and capabilities, databases, building new markets are some of the principles followed. | | | | | | | | | | | | | | | | | | | | | | 2014 | | As % of Revenues | 2012 | 2013 | Q1 | Q2 | Q3 | Google Websites | 68% | 67% | 68% | 69% | 68% | Google Network Members’ Websites | 27% | 24% | 22% | 21% | 21% | Other Revenues | 5% | 9% | 10% | 10% | 11% | (Investor...
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...Case Study Presented to Associate Prof. Guntalee Ruenrom, Ph.D. & Ajarn Yayus Mak Prepared by MBA English Program #3 Kotchaphan | Laochareon | 518 27814 26 | Ratanapong | Sanpote | 518 29421 26 | Thanan | Sastarasadhit | 518 28530 26 | Karit | Yuvaboon | 518 28094 26 | For the Course of 2605691 Seminar in Marketing Management Faculty of Commerce and Accountancy Chulalongkorn University QUESTION 1 : Identify the primary issues in the case. Between 1997 and 2005 a series of crisis severely challenged the hotel industry and stake holders, especially in asia region, which never before have so many issues that causes a crisis that has lasted that long With majority of properties located in asia, Banyan tree was hit hard by the crisis causing poor profitability in 2005. Foreseeing the risk of focusing its core operation in one region, Mr.Ho, CEO of Banyan tree initiates the expansion plan of banyan tree to open new properties in new location in order to minimize the risks. The IPO was executed to increase the capital for this expansion. However, the key issue of this aggressive expansion in how banyan tree can maintain its respective qualities across the chain due to: * The limitation of manpower and infrastructure to consistently deliver banyan Tree’s experience * The danger of bran dilution in case of banyan tree expands into territories that may have a negative impact on the brand. Its very important that...
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...Vietnam. Growth in these parts of the world is being driven by forces that don’t show any signs of weakening: steady population expansion, rapid urbanization, a proliferation of technology, and gradual opening up of economies and adoption of market-oriented policies. Global packaged-goods producers can gain significant foothold in these markets if they manage talent shortages, infrastructure gaps, and the highly fragmented trade landscape. There is no one-size-fits-all approach to doing this. Our research demonstrates that outperforming consumer-packaged-goods (CPG) companies use a set of standardized practices or tools across markets to determine their priorities for growth in each country. They clearly define their value propositions for customers, achieve optimal distribution, and continually strive to build sustainable operations and organizations. However, to be successful, these companies customize the standardized practices and tools based on the scale and strengths of their companies in particular regions, and local market dynamics and operational conditions. And, no matter the levers...
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...company stores. The investment would allow each store an additional 20 hours of labor per week. The objective is to improve service speeds and in turn increase customer satisfaction. We recommend that Starbucks proceed with the investment in labor. Customer service and satisfaction is one of Starbucks’ core competencies. If Day does not address the decline in satisfaction levels, Starbucks can potentially dilute its brand and ultimately lose market share reversing the sales growth achievements attained in the last eleven years. Starbucks’ Success In the last decade, Starbucks had consecutively achieved 5% or higher in comparable store sales growth. This success was due to several factors, primarily to its value proposition. Starbucks’ value proposition consisted of three components: the quality of coffee, the service provided, and store atmosphere. Starbucks prided itself in serving the highest-quality coffee in the industry. To maintain its coffee exacting standards, the company strived to control as much of the supply chain as it could. It worked directly with growers to purchase raw coffee beans; oversaw the custom roasting process; and it controlled the distribution of coffee to its stores. This control allowed it provide consistently high quality coffee products. The second component was customer service, also referred to as “customer intimacy.” The goal was for partners to connect with...
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...CHAPTER 1 WHAT IS STRATEGY AND WHY IS IT IMPORTANT? 1. Understand why every company needs a sound strategy to compete successfully, manage the conduct of its business, and strengthen its prospects for long-term success. 2. Develop an awareness of the four most dependable strategic approaches for setting a company apart from rivals and winning a sustainable competitive advantage. 3. Understand that a company’s strategy tends to evolve over time because of changing circumstances and ongoing management efforts to improve the company’s strategy. 4. Learn why it is important for a company to have a viable business model that outlines the company’s customer value proposition and its profit formula. 5. Learn the three tests of a winning strategy. Copyright ®2012 The McGraw-Hill Companies, Inc. McGraw-Hill/Irwin 1–2 WHAT DO WE MEAN BY STRATEGY ? ♦ What is our present situation? ● ● WHAT IS STRATEGY ABOUT? ♦ Strategy is all about How: ● ● ● ● Business environment and industry conditions Firm’s financial and competitive capabilities Creating a vision for the firm’s future direction How to outcompete rivals. How to respond to economic and market conditions and growth opportunities. How to manage functional pieces of the business. How to improve the firm’s financial and market performance. ♦ Where do we want to go from here? ● ♦ How are we going to get there? ● Crafting an action plan that will get us there 1–3 1–4 WHY DO STRATEGY ? ♦ A firm does...
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...British Airways – Flying Into a Storm Alan Michael F13066 1. Bob Ayling who succeeded Marshall was a lawyer by profession, who took care of drafting the bill for privatising BA .Bob Ayling was a visionary whose actions revolved around bring down the cost of operation there by to increase profitability even when BA was doing well. However on the other side he failed to value his employees, which ultimately led to the failure of him as a CEO. Things went well during Ayling’s Tenure. * Identified the need to cut costs for becoming a better performing airlines * Initiated the industry transforming alliance with American Airlines * Held on to his stance despite strong oppositions showing a determined face of BA * Rebrand BA to make it more attractive to international travellers * Later, modified BA’s strategies as when problems cropped up Things not went well during Ayling’s Tenure. * He implemented cost-cutting without taking into consideration the stakeholder’ point of view. The employees’ salary cuts will never lead to their better performance unless they are given any other incentive to perform better. Maybe he should have restricted their pay by putting more pay per performance quotient put into it. * No communication of the organization vision to the employees which led to their disillusionment * He missed out on the people touch points - both employee and customer wise. A fatal error in a service industry. * He failed to create...
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...Can You Say What Your Strategy Is? by David J. Collis and Michael G. Rukstad CAN YOU SUMMARIZE YOUR COMPANY’S STRATEGY in 35 words or less? If so, would your colleagues put it the same way? It is our experience that very few executives can honestly answer these simple questions in the affirmative. And the companies that those executives work for are often the most successful in their industry. One is Edward Jones, a St. Louis–based brokerage firm with which one of us has been involved for more than 10 years. The fourth-largest brokerage in the United States, Jones has quadrupled its market share during the past two decades, has consistently outperformed its rivals in terms of ROI through bull and bear markets, and has been a fixture on Fortune’s list of the top companies to work for. It’s a safe bet that just Getty Images and IPNstock 82 Harvard Business Review | April 2008 | hbr.org It’s a dirty little secret: Most executives cannot articulate the objective, scope, and advantage of their business in a simple statement. If they can’t, neither can anyone else. Can You Say What Your Strategy Is? about every one of its 37,000 employees could express the company’s succinct strategy statement: Jones aims to “grow to 17,000 financial advisers by 2012 [from about 10,000 today] by offering trusted and convenient face-to-face financial advice to conservative individual investors who delegate their financial decisions, through a national network of onefinancial-adviser...
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