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By :
Debasree Paul
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What is Value Network?It i s a netw or k; of al l th e p eopl e an dcom pa nies ; th at con tribute to th eincreas e i n a p rod uct s val ue, a s th e firm
pr oceed s th ro ugh vari ou s s ta ges ofmanufactu re a nd di stri buti on.Often va lue netw or ks a re con side red to
con sist of gr ou ps o f com pa nies w or kingtogeth er to pro duce a nd tr anspor t aproduct to th e cu sto mer .
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Relat ionshi ps am ong cu sto me rs of asingle comp an y ar e e xa mpl es o f h owva lue netw or ks can b e fou nd in an yorgan izati on.Com pan ies can link th ei r customersto geth er by di rect m eth ods like th etel eph on e or indirect m eth ods l ikecom bi ning custom er s re sou rces to geth er .
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Christensen defines va lue n et wo rk a s :"T he collecti on o f ups tre am suppl ier s,
dow nstr ea m ch an nel s to m ar ket , a ndancillary pr ovi de rs th at suppor t acom mon bu sines s m od el w ith in a nindu stry .
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Example
Pal m, the lead ing m an ufactu rer ofhandhel d devi ces , h as a w hol e com munityof - supp lier s & as sem bl er s ofsem icon du cto r comp on en ts , p las tic cases ,LCD displ ays & acc essor ies ; of on line &of f-line res el lers , a nd of 45,000com pl em en tor s w ho h ave cred ited o ver5,000 a ppl icati on s fo r th e Pal m Opera ti ngSys te ms
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Th is pers pecti ve yi el ds sever al insigh t :4) Th e com pa ny can es ti mate w heth er more
mon ey is mad e ups trea m o r d own strea m ,incase it m igh t wan t to inte grateba ck ward o r for wa rd6) Th e com pa ny is mo re aw are of th edistu rba nces in th e suppl y chai n th at
migh t cause cos ts , p ri ces or s uppl y toch an e s udd en l
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Val ue n etwo rks consists o f th es ecom pon en ts :A set of custom ers .Some s ervi ce t he custom ers all use, an den abl es inter acti on b etwe en th ecu sto mer s.Some o rgan izati on that pro vi des th eservice.A set of contra cts th at en ab les acces s to
the service.
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An ob vi ou s example of a va luenet wor k i s th e n etwo rk fo rm ed byphone users. The ph on e com pa ny pr ovi des aservi ce, u sers en ter a contr act w ith th eph one compa ny and i mmed iatel y h as
acces s to al l th e val ue n etwo rk ofot her cu stom er s o f the p hon ecom pa ny.
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Marketing channelsMos t pr od ucers d o not s ell th ei r goo dsdirec tl y to th e final u sers ; be twee n th em
sta nds a set of inter med iar iesper for mi ng a vari ety of functi ons.Th es e inter med iar ies betwe en th epr od ucers & cu sto me rs , con sti tu te amarketi ng channel ( also cal led a t rad e
ch an nel or d istr ibu ti on ch an nel ) .
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Fo rm ally, marketi ng channel s ar e setsof i nterd epe nden t o rga nizati on sinvol ved in th e pro ces s o f ma ki ng apr od uct o r servi ce a vai lab le for use o rcon sump ti on . They ar e th e set of path wa ys apr od uct o r servi ce f ol low s af terpr od ucti on , culminati ng in p urch aseand u se b y th e f inal en d user .
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Some i nterm ed iari esw hol es al ers and
re tai lers bu y, ta ke t itl e to, an d res ell th emer chandise; th ey a re cal led mer chan ts.Oth ers b ro kers , ma nufa ctu re rs re pres en ta ti ves , sal es agen tss ea rch forcust om ers an d may negoti ate on th epr od ucer s beh al f but to n ot take ti tl e toth e goo ds ; th ey ar e ca lled agen ts.Sti ll o th er stra nspor tati on compa nies ,inde pen den t ware hou ses , b an ks,adve rti sing a gen ci es a ssist i n the
distr ibu tion pro ces s bu t nei ther ta ke ti tl e
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