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2009

Answers of the five questions of the case then the summary with graphs, calculations and Smart Arts.

Product Positioning Case Study

Mohamed Kadri
3/22/2009

Wednesday, March 25, 2009

Case Study Marketing Management

1. As the marketing management of PPM computers, what segment should you concentrated on? PC a) The most Important Segment
30 years old. Male. Better off financially Small Business
Changing their PC Concerned about type of the machine Simplicity Reliability Manuals Attachments Consumables Service Price

Psychographic

Demographic

UK

Working or middle class Technologic al -Oriented Thinker

b) Another Influential Segment

Young People Children Few Financial Commitm ent
Social Class LowerUpper Middle Life Style Excitement Technologic al Seeking Readiness to buy the Product Occasion Summer Vacation Attitude Enthusiastic Benefits Games and Utility Amusement
Mohamed Kadri

Psychographic

Demographic

Geographic

UK

Behavioral

Behavioral

Geographic

Wednesday, March 25, 2009

Case Study Marketing Management

Network (i.e. X system)

Situational Factors
Purchasing Approches Operating variables

Demographic

Medium sized companies Financial UK

Technological prefrences Service Power OS Network

FinanciallyDomi nated Highly trained Sales Force Connectivity Service

Specific Application Customer Service Ease of use

Workstation(i.e. Y system)
UK High Speed Engineering Design User
Operating Variables Demographic Purchasing Approaches

Technological Prefrences Speed Power Specialized Software

Engineering dominated Reliability Service support Price

Mohamed Kadri

Wednesday, March 25, 2009

Case Study Marketing Management

2. What are the crucial product benefits that you should be supplied?
PC
Introduction of another core product rather than PC640 because the trend in the market is towards faster machines as the price of Microprocessors and Memory Storage is decreasing that leads to rapid growth in Software, Multimedia and Graphics and the company have to concentrate on building brand name by other varieties. Moreover PPM should update PC640 with Microprocessor and Memory storage. PPM has to focus on the improvement of SERVICE as a main component in its development along with, RELIABILITY, SOFTWARE, and MANUALS. PPM should give warranties as an Augmented Product.

NETWORK
PPM has to improve CUSTOMER SERVICE AND CONNECTIVITY because it covers the main criteria essential for the Financial Sector which is the most potential customer in this product range.

WORKSTATION
PPM has to maintain its market share in this sector by the same product but it has to improve the POWER, SPECIALIZED SOFTWARE AND SERVICE SUPPORT.

Mohamed Kadri

Wednesday, March 25, 2009

Case Study Marketing Management

3. How should you reach these customers? Place

PC
PPM has to concentrate on UK market because it is its main market but it is preferable to penetrate other markets by Subcontracting with Agents abroad because PPM has felt resources and it had continued to have marginal growth from 1% to 6% in the last 5 years. PPM has to have Wholesalers in this sector to solve two major problem: 1. Saving the company from subcontracting the entire PC operation. 2. Solving the stock problems. PPM should penetrate new market which is Direct Mail as none of the current companies used it.

PPM should focus on Independent Specialist and Specialist Computer Multiple as the value of these two outlet had increased from 1990 to 1995 .

NETWORK
ONE STATEGIC ISSUE IS VERY IMPORTANT IS TO CUT THE
ARRANGEMENT WITH DEALERS.

The most important thing in this sector is to make direct

sales from factory as Apricot 60% direct sales and this will lead to marvelous increase in profit as the cost

difference between the Dealer(58) and the

Mohamed Kadri

Wednesday, March 25, 2009

Case Study Marketing Management

customer(100) is very high because the Variable manufacturing cost is (32). From the findings,PPMs Dealers Sales is 85%. Moreover, they require support of about 24 Sales Rep. as mentioned in Calculation (P9) in the brief Summary and Analysis for this case study.

WORKSTATION
PPM should maintain its direct sales because the company cant withstand the margin for the distributor especially the manufacturing variable costs remained high and the company want to drop in the following year but it has to support it with highly trained sales forces to establish contact with the main customers to demonstrate and install systems to customers specifications.

Promotion
PC
1. Personal Selling Increasing Sales Rep. can assist the high street outlets as they represent the bulk sales for PPM (85%) and corresponding with the market trend (40%). Professional training for this sales team is prerequisite. 2. Advertising Promotional investment in mainstream computer magazines like Olivetti and Tandon because it was
Mohamed Kadri

Wednesday, March 25, 2009

Case Study Marketing Management

considered that press and magazine advertising were more appropriate for the product aimed at the mass market. The best one is PERSONAL COMPUTER as its name is relevant to the sector that we are focusing on. Moreover it has high circulation rate 470,000 with reasonable price 4,500. 3. Events and Exhibition Concentrating on exhibitions included stand, personal and demonstrational equipment. It costs around 15,000 per day with 102 days in the UK only then it has to be activated by the follow up of the professional Sales Rep.
4. Sales Promotion

Focusing on sales promotions with some add value according to the market trends such as printers and software at the same package.

NETWORK
i. Personal Selling PPM has to build effective sales forces who are

capable of consulting for the software programming because this sector is very tough and sophisticated (i.e. Business to Business).
New recruitment to Support firms which are the main consumer for the network products by increasing the number of Sales Rep. and effective training. Reallocation of the three Sales Rep. to cover the firms instead of the dealers. One of the strategic decisions which should be taken is to withdraw those dealers and PPM should supply directly. ii. Advertising
Mohamed Kadri

Wednesday, March 25, 2009

Case Study Marketing Management

PPM has to spend on media according to the market trend expenditure (2.5M to 5M) as all PPMs expenditure in this sector was around 0.3M. iii. Events and Exhibition

Participation in publications and exhibition with average cost of 1.5M according to the minumum acceptance level of the marketing trend that other competitors did but PPM should know that the role of this events is to identify prospects and generate business as it will yield maximum gain after that.

WORKSTATION
PPM has to assign professional Sales force because it is the most important key factor in this segment . The highest acceptable level is 1:120 = sales:client. So PPM can maintain their market share and make substantial growth in this sector.

Price
PC
There is a High Price Elasticity in this sector so PPM should do the following: Introduction of another core product rather than PC640 with price between the Premium and Penetration Price Strategy as the price of Microprocessors and Memory Storage are decreasing rapidly. The trend in the market is towards faster machines and PPM can price to around 150 as an average among other

Mohamed Kadri

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Case Study Marketing Management

competitors with premium quality so that to rebuild their brand (P6 Summary). PPM should update PC640 with Microprocessor with slight rising in the existing price 120-130 to maintain its competitive advantage in this sector over other competitors and restore profit in this sector.

NETWORK
There is much lower price elasticity in this range than in PC so PPM should do the following: PPM has to Maintain its core product X912 in this sector and improving CUSTOMER SERVICE, PERFORMANCE AND CONNECTIVITY which may cost the company a little then the company can introduce it with price up to 130 (P6 Summary) which is below the average price of all competitors and we will introduce Software Package with this price.

WORKSTATION
There is much lower price elasticity in this range than in NETWORK so PPM should do the following: Maintaining its core product Y4000 in this sector and improving POWER OF CALCULATION, SPECIALIZED SOFTWARE AND SERVICE SUPPORT with a premium level which may cost the company a little then the company can introduce it with price up to 205 (P6 Summary) which is in the average of the two main competitors. Moreover, PPM will introduce Software Package with this price to satisfy their customer need.
Mohamed Kadri

Wednesday, March 25, 2009

Case Study Marketing Management

4. What information should you have to control the progress of the marketing plan?
We should know much more about the marketing environment. We already have a lot of information about the microenvironment and some information about the internal environment but we have to collect data about the macro environment
The macro environment Economic factor

Socio-cultural factor Technological factors Political factor The Microenvironment Consumers Suppliers Stackholders The Internal Environment Men Money Machinery Material Minutes

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Case Study Marketing Management

Internal environment For example, we should know about the machinery, material and money of the organization. Micro-environment PPM can use SWOT analysis or Five Force Analysis to make control of the marketing plan. Threat of new entrants: For example, will new laws of export and far manufacturing be introduced that will weaken our competitive position? Bargaining power of Buyers: For example, will the wholesalers have the ability to purchase bulk PC products? Threat of substitute products: For example, Will other products be introduced as substation to the current ranges? Bargaining power of suppliers: For example, how much will it cost the dealing with Software Suppliers? Macro-environment It is called also PEST analysis. It is very important that an organization considers its environment before beginning the marketing process. Environmental analysis and information should be continuous and feed all aspects of planning.
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Case Study Marketing Management

Political
Factors

Technological
Factors

PPM

Economic
Factors

Socio-cultural
Factors

Political Factors The political arena has a huge influence upon the regulation of businesses, the spending power of consumer and other businesses. For example: Will government policy influence laws that regulate or tax PPM business? Is the government involved in trading agreement? Economic Factors PPM need to consider the state of a trading economy in the short and long-terms. For example: Interest rates. The level of inflation employment level per capita.
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Wednesday, March 25, 2009

Case Study Marketing Management

Long-term prospects for the economy GROSS DOMESTIC PRODUCTS (GDP) per capita. Socio-cultural Factors The social and cultural influences on business in UK For example, How much time do consumers have for leisure? What are attitudes to foreign products and services? Technological Factors This is one of the core issues which should be considered by PPM as it is the floor of its products and one of the vital things to build competitive advantages.

5. How can you build competitive advantage? PC

As the growth in Software is increasing more rapidly along with peripheral growth (25%-25%) so Consumer Buyer Behavior will be targeted towards PCs which have additional software implications. 1. Sales Promotion: o We can give customer free accessories and multimedia programs for their PCs as there is marvelous growth in the peripheral devices (25%i.e.20B) and Multimedia Software (from 0.2B to12B). o From June to September, PPM can make special offer for their PCs to make special package
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Case Study Marketing Management

2.

3.

4.

5.

6.

7.

with the newest and fashionable virtual reality games to nourish this seasonality decline as in this season, the prospectus segment of young people and children is likely to be in their summer vacations so this offer may encourage them seriously. Software Exhibition: PPM can be a sponsor to one of the most popular Software Exhibitions to increase the awareness of PPM brands. Telecommunication Companies Collaboration: PPM can make compatible software with one of the leading companies in the field of Telecommunication Internet Advertising Companies Collaboration: PPM should make deals with Internet Advertising Companies like Yahoo and Google to increase the awareness about the company and its brands. Online Auction: PPM should publish their products on the Online Auctions like eBay to so that e-commerce can be initiated for the companys products. Graphics and virtual reality games Collaboration: PPM should know the criteria of Microprocessor, Data Storage and VEGA cards which are compatible with Graphics Companies spectacular growth in these fields and PPM can arrange activities with these organizations. Direct Mail: PPM should exploit this way of promoting their PC as the competitors didnt use this toll before and the company may contract with IT Company to arrange this innovative promotion for the PC range.
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Case Study Marketing Management

Network (i.e. X system)

1. Sales Promotion: PPM can make package consisted of Financial Software compatible with X system to the top 10 customers as it is the most potential market in the Network range. 2. Alliances with Electronic Mail Companies as they are one of the most important software that corporate use its software according to the surveys findings. This can benefit the main customer-Financial Sectoralong with other Manufacturing, Retail and Transportation sector.

Workstation (i.e. Y system)

PPM can make package for other Design users of this range by combining Design System Software with their workstation. PPM could make Peripheral Devices customization such as Keyboards and Mousers for the potential customers of workstation to augment the input speed for their stations.

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