Focus and Approach…

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I saw this cartoon and it reminded me of many meetings I was in while working in various marketing roles.  As marketers we often have an abundance of information to consider and goals to achieve.  Figuring out where to start and how to create a cohesive strategy is a challenge many businesses, large and small, struggle with.  In Essentials of Marketing we provide a framework and process for creating a marketing strategy.  It all starts with bringing in information from your customers, company, competitors, and external market environment (context).  From there the process organizes and filters that information, applies segmentation and positioning approaches, and at that point creating your marketing mix becomes much more straightforward.  A diagram of the process is shown below and more information can be found in our book.  Chapter 2 provides an overview of the process and then each subsequent chapter dives into detail on one of the components.

What’s Now? Chapter 3 – BMW Faces the Future of the Driverless Car

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BMWVisionThe future of the automobile industry, while still blurry, is beginning to come into focus. Experts agree that self-driving cars are the future. But will we own one of these cars? Or will a self-driving Uber pick us up and take us where we want to go as needed? Planning for these potential futures are challenges facing all carmakers.

Chapter 3 briefly explores the influence of technology with the example of the driverless car. “The Ultimate Driving Machine Prepares for a Driverless World” (Fortune, March 1, 2016) digs deep into this future from the perspective of German carmaker BMW. The image on the right is a BMW Vision concept car.

Conduct a SWOT analysis on BMW as it looks at this future. Identify two strengths, two weaknesses, two opportunities, and two threats.

Mercedes Benz’s driverless car prototype

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The driverless car is a reality. This video might be fun to drop into a lecture on the external market environment — to stimulate a discussion of technology. What markets will the driverless car influence? How will it change law enforcement? What about bars and restaurants — which may have more demand as people can stay out and drink without having to drive home? There are predictions that driverless cars will have many fewer accidents? What are the implications for the automobile insurance industry? What about demand in hospital emergency rooms?

These discussions will help students see the need to monitor technological changes that may not immediately appear to impact their business. The emergence of the driverless car (which now seems inevitable) will impact many different product-markets. There might also be a discussion of consumer behavior (some consumers may love this idea, it may be a challenge for others) or the product life cycle (how do you introduce this product to the market) or new product development (the role of prototypes).

The video shows Mercedes Benz’s driverless car prototype.

Technology Is Changing Our Relationship With Driving

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Screen Shot 2014-06-30 at 7.18.05 AMSome technological and social cultural trends are beginning to have an impact on how Americans drive. Think about smartphone based services like Uber and Zipcar — which may make car ownership much less necessary. Google’s self-driving car is on the horizon. And people are more and more interested in city living. This Fortune article “The end of driving (as we know it)” (June 12, 2014) highlights these trends.

I like to encourage my students to anticipate trends and think about the future. I will have them read this article and ask a series of questions:

  • What industries could see these trends as threats?
  • What industries might see these trends as an opportunity?
  • What new goods or services might leverage these opportunities?

Encourage your students to move beyond the immediately obvious examples — automobile manufacturers — and encourage them to consider other industries (say hospital emergency rooms that do a lot of business from automobile accidents — which should decline significantly with self-driving cars).  These questions are designed to help them recognize and anticipate change. You might use this when you cover the external market environment, demographics, consumer behavior, or marketing strategy planning.

Paper Companies Adapt to Changing External Market Environment

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mooluxe_stacks_mixed-2Not many of us would have placed stock market bets on paper companies in the last decade — not with so many of us going “paperless.” A couple of big players in the business – Mohawk and International Paper – adapted marketing strategy and have done quite well. This article in the Wall Street Journal “U.S. Paper Industry Gets and Unexpected Boost” (March 7, 2014, non-subscribers may need to click here) describes their successes (and some failures) in adapting to a rapidly changing technological environment. By developing new and more profitable product lines, these companies have seen their profits (and stock prices) soar.

The paper industry might provide an example of the product life cycle — as many traditional paper products (say photocopy paper) may be mature or in decline while other product lines (like high quality papers that could be used to print holiday cards) are in growth.