Last week I started a required 40-Hour construction safety class for NYC Department of Building Superintendent License. It been a few long days and hard working from 7:00 to 2:30/3:00 running my job sites and then traveling to NYC for a class from 4:30 to 9:00. I have been trying to relate this safety class to our marketing class and was having trouble making a connection. Last night we talked about how to make everyone on the job site not only aware of the safety rules and regulations but to follow them. As the construction superintendent, construction safety coordinator or construction safety manager it is our responsibility to enforce safety throughout the job. The instructor then said that we need to sell safety to the guys working. Making one additional sale can improve the entire job site. Once someone of the job realized how important safety is, it travels through other workers and other trades. In theory, we as the job super need to sell the idea that safety will improve work and does not impact the schedule to all contractors working on the job. An unsafe job or one not meeting city safety requirements will be order a 'Stop Work Order' therefore delaying the job.
Managing a safe job site also plays into out customer service. If the job site is safe and there are no violations from the city or state the job will be shut down. There will be no delays in the project and a better chance of meeting the completion date. Meeting the schedule and allowing the client/building owner to start operating is the most important goal. Without an operational building the client is not making any money. A safe project can lead to a pleased client and hopefully they will hire us again.
Tuesday, April 30, 2013
Sunday, April 28, 2013
Week 4 - Consumer Analysis
Last week was all about the market, this week was about the consumer/customer. Understanding the market and your competitors is one challenge of marketing. Understanding the consumer is another. When analyzing the consumer a marketer needs to answer the questions: Who is the consumer? What are they buying? Where do they buy? When do they buy? Why your product over a competitors?
Since I work in construction they marketing aspect is much different then other businesses. We do not do a lot of marketing, many of our customers find out about us from their architects, engineers, landlord or consultant. We also so a ton of repeat business. The following are the answers to the previous questions for my company. Who? Our customers are businesses looking to build a new office, expand their office, or renovate their offices. We also work for the landlord/building manager upgrading base building facilities and building spec spaces. What? They are buying construction management services. Where? We do not have any point of purchase as this is a service not a product. When? Our customers hire us either before their process starts and use us as a construction consultant or after pricing has been submitted and they pick their general contractor. Why? Customers hire us for many reasons, most of the time it is because they like our services and our price fits in their budget.
The consumer decision process consists of 5 steps. Needs recognition, information search, evaluation of alternatives, purchase and post purchase behaviors. One of the questions this week was to evaluate our company's marketing strategy. Like stated before our industry is different then other businesses and we do not have a detailed marketing strategy. Our customers recognize that they have a need for a construction manager or general contractor to complete some type of construction project for them. Their information search consists of gathering information about various GCs and getting their input on the project. The GC is then asked to price the project. The customer compares the pricing and additional services offered from multiple GCs. The purchase happens when the consumer hires a GC. In this industry the most importantly step of this process is the post purchase behavior. A customer can either be very involved in a project or detached from it. Their trust in you to complete the project on time and within budget is their biggest concern. Hopefully you have pleased the customer and if they have another project they will hire you again.
We read an article this week about marketing and social media. This is not something that we use in our company and it would not help us improve our marketing strategy. The article did show a different decision process for consumers called the consumer decision journey. It shows how social media can influence consumer. The two processes are vary similar. They both start with a need, an information search, a purchase and post purchase activities. Its the post purchase activities that make social media a marketers friend or foe. The consumer can post a review of the product almost anywhere online. This review can either influence others to purchase or go to a competitor. Social media could be a marketers best friend or worst enemy.
One of the questions this week was to review our own over the counter cold medicine purchases, similar to what we will be doing as the marketers in PharmaSim. I am not the person that buys medicine every time I have a little cough or cold. When I am sick and need to take medicine I usually stick with the same couple products. I prefer Tylenol Cold and Sinus for an average bad cold. When I have a very bad cough I use a Robitussin cough remedy. One of the most effect cold medicines I have taken and would recommend to anyone is Mucinex. Mucinex works great at clearing nasal and head congestion. PharmaSim also talks about allergy medicine. A niche in the OTC market since it used to be by prescription. I prefer to take Claritin. As long as I take it daily I do not have many allergy symptoms.
This upcoming week I will be attending a construction safety class every night in New York City. Not a very interesting class but one that is very important to working in the construction industry. If possible, I will try to connect construction job site safety it to this class.
Since I work in construction they marketing aspect is much different then other businesses. We do not do a lot of marketing, many of our customers find out about us from their architects, engineers, landlord or consultant. We also so a ton of repeat business. The following are the answers to the previous questions for my company. Who? Our customers are businesses looking to build a new office, expand their office, or renovate their offices. We also work for the landlord/building manager upgrading base building facilities and building spec spaces. What? They are buying construction management services. Where? We do not have any point of purchase as this is a service not a product. When? Our customers hire us either before their process starts and use us as a construction consultant or after pricing has been submitted and they pick their general contractor. Why? Customers hire us for many reasons, most of the time it is because they like our services and our price fits in their budget.
The consumer decision process consists of 5 steps. Needs recognition, information search, evaluation of alternatives, purchase and post purchase behaviors. One of the questions this week was to evaluate our company's marketing strategy. Like stated before our industry is different then other businesses and we do not have a detailed marketing strategy. Our customers recognize that they have a need for a construction manager or general contractor to complete some type of construction project for them. Their information search consists of gathering information about various GCs and getting their input on the project. The GC is then asked to price the project. The customer compares the pricing and additional services offered from multiple GCs. The purchase happens when the consumer hires a GC. In this industry the most importantly step of this process is the post purchase behavior. A customer can either be very involved in a project or detached from it. Their trust in you to complete the project on time and within budget is their biggest concern. Hopefully you have pleased the customer and if they have another project they will hire you again.
We read an article this week about marketing and social media. This is not something that we use in our company and it would not help us improve our marketing strategy. The article did show a different decision process for consumers called the consumer decision journey. It shows how social media can influence consumer. The two processes are vary similar. They both start with a need, an information search, a purchase and post purchase activities. Its the post purchase activities that make social media a marketers friend or foe. The consumer can post a review of the product almost anywhere online. This review can either influence others to purchase or go to a competitor. Social media could be a marketers best friend or worst enemy.
One of the questions this week was to review our own over the counter cold medicine purchases, similar to what we will be doing as the marketers in PharmaSim. I am not the person that buys medicine every time I have a little cough or cold. When I am sick and need to take medicine I usually stick with the same couple products. I prefer Tylenol Cold and Sinus for an average bad cold. When I have a very bad cough I use a Robitussin cough remedy. One of the most effect cold medicines I have taken and would recommend to anyone is Mucinex. Mucinex works great at clearing nasal and head congestion. PharmaSim also talks about allergy medicine. A niche in the OTC market since it used to be by prescription. I prefer to take Claritin. As long as I take it daily I do not have many allergy symptoms.
This upcoming week I will be attending a construction safety class every night in New York City. Not a very interesting class but one that is very important to working in the construction industry. If possible, I will try to connect construction job site safety it to this class.
Sunday, April 21, 2013
Week 3
This week we read in the Lehmann and Winer text, the chapters focused on the background analysis of the market. It reviewed competition, the industry as a whole and the competitors. One of the questions that came up during out lecture was, who actually defines the competition? Is it the customers of the company? I think it is a combination of the customer and the company. The companies need to develop products that meet the needs of their customers. BMW competes with Mercedes Benz in the luxury car market. Each company develops the cars they think best meets the needs of the customers. A customer picks one product over the other because it meets their needs. The BMW might have better handling or MPG but the Mercedes has more horsepower and more comfortable interior. The customers are the ones buying the product, they determine what attributes a product needs to meet their expectations. If the customer picks the BMW, it could be because of the better MPG. Mercedes now needs to develop a car to meet that customer need. The competition is defined by both the customer and the company. The products go through a cycle of being produced then improved upon and released again based on what the customer wants and what the competing company is doing.
Competitive strategy is different then competitive analysis. The competitive strategy needs to take a broad focus on everything that could affect the company. The competitive analysis is focused more on your direct competitors. While thinking about the difference between the two I came across and article from the Harvard Business Review. "The Five Competitive Forces That Shape Strategy". The article talks about how competition for profits goes beyond industry rivals. The other competitive forces that affect a business are customers, suppliers, potential entrants, and substitute products. Once area that companies can often get hurt in is by missing out on potential new products that entrepreneurs bring into the market. It is hard to protect yourself from entrepreneurs entering the market. Businesses do not always know when new competitors might enter the market. Businesses need to protect against to segments of competition, the products that are imitators of your product or service and those that are substitutes. Competitive strategy is much more then just analyzing your direct competitors. There are other factors in the market that can affect for profits, like indirect competition. I work for Signature Construction Group, a general contractor/construction manager. We compete directly with other general contractors like Malkin Construction and AP Construction. We also compete with construction management/owner rep firms like Jones Lang LaSalle, Cushman & Wakefield and CB Richard Ellis. Some of our indirect competitors would also be out subcontractors. These subcontractors could be working for a GC that we compete with or even work directly for the client. In either situation we are missing potential profits. All businesses need to be aware of their competition, those that they directly or indirectly compete with and those that might be new entrance to the markets.
Competitive strategy is different then competitive analysis. The competitive strategy needs to take a broad focus on everything that could affect the company. The competitive analysis is focused more on your direct competitors. While thinking about the difference between the two I came across and article from the Harvard Business Review. "The Five Competitive Forces That Shape Strategy". The article talks about how competition for profits goes beyond industry rivals. The other competitive forces that affect a business are customers, suppliers, potential entrants, and substitute products. Once area that companies can often get hurt in is by missing out on potential new products that entrepreneurs bring into the market. It is hard to protect yourself from entrepreneurs entering the market. Businesses do not always know when new competitors might enter the market. Businesses need to protect against to segments of competition, the products that are imitators of your product or service and those that are substitutes. Competitive strategy is much more then just analyzing your direct competitors. There are other factors in the market that can affect for profits, like indirect competition. I work for Signature Construction Group, a general contractor/construction manager. We compete directly with other general contractors like Malkin Construction and AP Construction. We also compete with construction management/owner rep firms like Jones Lang LaSalle, Cushman & Wakefield and CB Richard Ellis. Some of our indirect competitors would also be out subcontractors. These subcontractors could be working for a GC that we compete with or even work directly for the client. In either situation we are missing potential profits. All businesses need to be aware of their competition, those that they directly or indirectly compete with and those that might be new entrance to the markets.
PharmaSim
This week I played another round of PharmaSim. My stock price dropped by approximately $2.00. I think this was due to the loss in net income even though my revenue increased. Next week I will try a combination of a price increase and then minimize my costs to improve net income. I was looking at ways to lower costs of I purchased the Brand awareness report, hoping to see high awareness and retention.
As the above Brand Awareness report shows, there is a very high percentage of brand awareness and conversion ratio.The combination of these ratios show that customers are aware of Allround and when they go to the store to purchase Allround, they do not replace it with a competitors product. One improvement that could be made is in the retention ratio, customers who purchase our products again. Based on these numbers, I think we can reduce our advertising budget and help improve our net income. Next week I ill update on the results of the reduced advertising budget.
Sunday, April 14, 2013
Week 2
This week we talked about the market that affects a business and the importance of marketing research. There are many factors in the market that need to be analyzed by marketers and managers to determine the company's position. It is the job of the marketers to create a value that
delivers customer satisfaction and loyalty. Marketers use a variety market reports to forecast their sales. The Lehmann and Winer text talks about the difference between the market potential and the forecast. The market potential is the maximum sales reasonably attainable under a given set of conditions within a specified period. The forecast is the amount of sales expected to be achieved under a set of conditions within a specified period. Potential forecasts have a wider range of uses. They are used to determine a market, make long term decision, set objects and have an input to the forecasts. The forecasts are more defined and based on who the end user is, how many end users are in the market and estimate the purchase rate. Most of this research is bases in statistical data.
Looking at data is one thing,
knowing what to do with it is another. I heard this statement in an IBM commercial as I was getting ready to write this post. It caught my attention as I felt it related to Drucker's theory of market research and the introduction to chapter 15. IBM's research about the personal computer caused them to miss a major new market. Steve Jobs enter the person computer industry without any market research and built a very successful company. Drucker preferred to use knowledge, instinct and gut feelings to make marketing decisions. The problem with IBM researching the personal computer industry was that there was no current market to research. There was no data on who the end users would be or past sales data from competing businesses. Not all factors are quantifiable and they can not be measured. When entering a new market, one of the best marketing research tests is the reality test. A company puts a limited number of products into a confined market and studies the sales habits and user feedback. Marketing research is important to every business but there is more to it than just analyzing the numerical data. The marketer understand the existing and potential customers. Businesses need to both analyze the data and work with their gut instincts and knowledge of the market to make a final decision.
PharmaSim
This week I tried PharmaSim for the first time.The program is very detailed and there are quite a few decision to make as the marketer. For the fist period I did not make adjustments to the pricing or sales force. I switched advertisers to increase the budget and allow for more promotional items. I did not use all of the budget. Also, in the first period I did not buy any market reports, we were give a lot of data in the PharmaSim manual. After the first period, the sales, net income and stock price all rose. I played through a couple more periods, marking various changes to the sales force, advertising budget, pricing and promotions. I also bought and reviewed the market update, pricing report and brand formulations report. The reports were full of valuable information, I could have spent a lot more time reviewing them then I did. After the second period I noticed my sales had increased but my net income decreased. I used the pricing report to evaluate my price with my competitors. I raised my price in period 3. Sales numbers diminished slightly by revenues increase by 5% and net income by 20%. I have not changed the formula of the product or introduced a new product yet. I will try these next week.
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