IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Business PlanStrategy and Implementation

Summary

Patricia SALGUERO Departemen Teknik Informatika

Institut Teknologi Bandung

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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STRATEGY AND IMPLEMENTATION SUMMARY

Armies fight to win terrain, kill or disable adversary combatants...

Companies fight to capture market share, generate sales revenues, enhance profits...

“Both armies and business enterprises try to achieve their objectives through strategies”

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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STRATEGY AND IMPLEMENTATION SUMMARY

Specific business activities, each of which has concrete dates and responsibilities, and probably a budget.

Strategic Pyramid

Main focus

Implement Strategies

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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STRATEGY AND IMPLEMENTATION SUMMARY

Value Proposition:

A value proposition define the benefit offered;the target market group;and the relative pricing.

A value proposition define how product and service features are assembled and offered to meet customer needs; in other words, how a company gives value to customers.

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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STRATEGY AND IMPLEMENTATION SUMMARY

Competitive Edge

Is this a key competitive edge?products, services, retail

locations, prices, exclusivity, intellectual

property rights, licenses, franchise agreements...

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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STRATEGY AND IMPLEMENTATION SUMMARY

Key Competitive Edge

INNOVATION

ability to outwit, outsmart, outsell and otherwise outperform your competition.

driving force behind successful small businesses

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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STRATEGY AND IMPLEMENTATION SUMMARY

Cause-and-effect relationship:

Key Competitive Edge Basis for

Business/Basis for Growth

Innovation (Your ability to create or

acquire new ideas, strategies, services,

products, intellectual property)

Intellectual Property (patents, copyrights, design

registrations, etc), products, services, licenses, franchise

agreements, strategies, unique retail locations,

etc.

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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MARKETING STRATEGY

Every business owner should develop a written guideline that sets forth the business's marketing strategy.

This document is used to judge the appropriateness of each action that the business takes.

If a company has to take an action that is off-strategy, it may indicate a temporary emergency action prompted by competition or other factors beyond normal management control. Or it may indicate the need to change or revise the company's marketing strategy.

STRATEGY AND IMPLEMENTATION SUMMARY

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Marketing Strategy

• Concentrated Marketing

• Differentiated Marketing

• Undifferentiated Marketing

Involves introducing a single version of a product that is designed to appeal to a single, particular market segment.

Involves introducing a number of different versions of a product, each designed to appeal to a different market segment.

Involves introducing only a single version of the product in the hope that it will appeal to an entire universe of consumers, an appeal to the lowest common denominator.

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Positioning Statements

• Positioning on specific product features Unique features that have obvious value

• Positioning on benefits Product features----> Customer

• Positioning for user category Used by models --->customer identify

• Positioning against another product Implicit to explicit comparison

• Product class disassociation New product that differs from traditional products

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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PRICING STRATEGY

• Cost-Plus Pricing With this method you simply set prices to cover your fixed and variable costs, and leave enough room for profits. 

• Competitive pricing strategy

Compares alternative products and services and sets prices accordingly

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Pricing Strategy

Competitive pricing strategy/ Sample Compaq CTX Samsung Hewlett-

Packard

Processor 233 Mhz 266 Mhz 233 Mhz 200 Mhz

Memory 48 Mb 32 Mb 32 Mb 32 Mb

Hard drive

4.0 Gb 4.3 Gb 3.2 Gb 2.1 Gb

CD-ROM 24X 24X 20X 16X

Modem 56K 56K 56K 56K

Monitor 13.2” 13.8” No No

Printer Yes Yes No No

Zip Drive Yes No No No

Price $1,349.70 $1,299.99 $949.99 $799.99

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Pricing Strategy

• Premium price strategy

Customers must perceive the value of your premium service;

Be willing to pay for it; It must cost you less that the

price you receive. To the last point, "do not offer

gold plated service if you are only going to receive silver plated prices."

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Pricing Strategy

• Cream skimming pricing This option involves charging a high price relative to other brands within the product class.

• Market penetration pricing This is the strategy of setting prices low, or below the competition, initially to attract new customers.

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Promotion Strategy

Promotion involves communication of product attributes and corporate image in the most favorable light possible to

intermediary sellers and to end users.

PROMOTION STRATEGY

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Promotion strategy

Originator Intermediary End User

The “Pulling” Promotional Strategy

Originator Intermediary End User

The “Pushing” Promotional Strategy

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Promotion strategy

• Demographic What type(s) of people do we want to influence?

• Geographic Where are the people we want to influence?

• Impact Is the desired message well communicated and hard hitting enough to be memorable? Generally, advertising is designed to address the “AIR” concerns.

Dimensions of Advertising Effectiveness

• Reach How many individuals or householders will experience one exposure of the message?

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Promotion strategy

Dimensions of Advertising Effectiveness

• Frequency How many times will these people experience the message?

• Duration How long is the message?

• Timing When will the message be experienced?

• Cost How much does it cost to reach 1,000 people or households with a single exposure?

CPMMedia Cost

(Audience measured in thousands)=

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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DISTRIBUTION STRATEGY

How the product is convoyed from the producer to the end user. Its functions include manufacturing, transportation,

warehousing, wholesaling, and retailing.

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Distribution Strategy

There are essentially three distribution options, as follows:

• Selective Aims for limited exposure. The product is sold by a single dealer within each treading region.

• Intensive Aims for maximum exposure.The product is sold through any responsible wholesaler or retailer who will stock it.

• Elective Aims for moderate exposure. The product is sold through “better” retailers.

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Sales Strategy

Models

Consultative model

AIDA model

“Sales is asking the people what they do, how they do it, when they do it,

where they do it, why they do it, and who they do it with-and then help them

to do it better.” Stephan Schiffman

• “A” for Attention• “I” for Interest• “D” for Desire• “A” for Action

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Sales Strategy

Sales Promotion Tools and Activities

• Discounts • Premiums• Twofers• Coupons• Samples• Contests• Sweepstakes• Incentives• Product publicity

IF-ITB/PAT/03/03Aug09IS7074 - Business Plan

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Sales Strategy

Sales ForecastUse the text to summarize and highlight the Sales Forecast in a detailed sales forecast table. Try to emphasize important points and explain assumptions to the sales forecast. The monthly sales forecast chart and annual sales forecast chart should be drafted