Week 11

We have made it to the end of the semester. We have worked through many marketing concepts and how important marketing is to a business. We have complete the Pharmasim simulation which put those concepts to the test. In our last blog post we have been asked to take a look at marketing from the "macro" perspective. Marketing is more than just advertising, promotions and sales. Marketing encompass all aspects of a business and is a key factor to the success of any businesses.

There are 3 basic principles that a business needs to understand to be successful. First, the purpose of a business is to create a customer. Without customers there is no purpose of the business. Second, there are two basic functions of a business, marketing and innovations. Marketing and innovation create the customers and product results, all other aspects of the business are just costs. Third, marketing encompasses all aspects of the business.

Working in the construction industry we do not have a traditional marketing plan like other companies might. The majority of our marketing comes from interactions with clients, architects, engineers and building managers. Creating a customer starts with good relationships with architects and building managers. Architects and building managers suggest us to potential customers who are looking for a general contractor. Estimating the project correctly and having the right fees get us the customers. I would explain to my boss that without these important connections and a good estimating department we will not create any new customers.

Next, marketing and innovation produce results and all other aspects are costs. The results are produced during the construction phase of the project. During the project, it is important that the project manager and superintendent market the importance of the project to the subcontractors. Making sure we stay on schedule and within costs keeps our customers happy. There are various aspects of innovation during the project that can help us speed up the job or tackle obstacles. Innovation can be simple changes in the way we run our plumbing line to minimize material and labor costs to redesigning aspects of the project to save install time. Marketing and innovation during the project helps us be successful.

Last, marketing encompasses all aspects of the businesses. As seen in the two previous examples we need to continuously market ourselves to our customers and the project to our subs to be successful. From the first point of contact with a prospective customers to the receipt of the certificate of occupancy. We need to continuously use marketing throughout a project to be successful.

I have learned a lot about marketing through this class and how important is it to a businesses. I did not think about marketing at all within my own job until this class. I can definitely take what I have learned in class and apply it to my job in construction.

Week 10

As we continue to advance through the Pharmasim simulation it is time to look back on what we have done. This simulation has put us in the position to be marketing managers for Allstar Brands and work through the marketing management process. This process is long and detailed. It starts with having to analyze a wide variety of data from past years to help determine what your plans will be for the next couple of years. This is data about the market, customers, competitors and products. In Pharmasim, to have enough data to complete this analysis you need to buy all of the reports. Completing this analysis separately then your teammates allows you to analyze the data how you see it. Then you can compare and contrast with your teammates. I noticed that we came up with similar results after the analysis and had similar ideas on our strategy for the next periods. Completing the competitive analysis really helped me complete my understanding of our position in Pharmasim. It allowed us to determine a better pricing strategy and help lower costs. Since the situation analysis required us to purcase almost all of the reports we had data about everything. We were able to review ourselves as a company, our products and the competitors. We were also able to review data about the market's customers. The reported symptoms,  brand perception and purchasing decisions reports helped us understand how the customers picked a product and how we can better address our target market.

In each period of Pharamsim there has been a special decision to make. The decisions can affect how you implement your strategy in that period. The first special decision we had to make was about creating Facebook and Twitter accounts. Creating these social media accounts allowed for us to gain instant and free feedback from consumers about our product. These social media sites led to another special decision we had to make. We were receiving negative comments on the sites and needed to determine how to handle them. We decided get legal advice on how to handle these comments. It was suggested to us to turn off the comments until we have a written policy governing the use of the forum by both customers and employees. One of the most interesting decisions had to do with special advertising. We had the options to place our product in a movie, advertise on a race car or run an ad contests for consumers. We decided to run the ad contests as it got consumers involved.  We had a good response to this decision as there were a number of good entries submitted to the ad contest, and the videos are generating a lot of interest on the web site.

 The most important decision we have made in Pharamsim was to raise our price. With the low price in the early rounds we were generating a lot of unit sales but we did not have a great bottom line. Once we raised our prices we saw a rise in revenue, gross margin and net income. When we were selling Allround at the low price we were operating over capacity by 17%. This increase our costs of goods sold tremendously and hurt our gross margin and net income. With the higher price, unit sales decreased and so did gross margin. This allowed for a better bottom line. Pharmasim has been a good tool in teaching us about the marketing management process. It is really important to understand all of the market data to create a plan for your future.

Towards the end of class Proffessor Spotts talked about a class that WNE is offering that combines engineering and marketing. I look this class my senior year at WNEC, the first year it was offered. It was one of the most interesting class I took in my 4 years there and I learned alot. When I took the class there were a handful of teams that developed a product from scratch and created a company around it. There were other teams that worked a intrapreneur. My team worked with Smith and Wesson developing a new style handcuff. We went through the process of determining the size of our market, who the customers would be, what the existing products are and what could be improved. We determined that a new, lightweight handcuff would help reduce the total weight of the belt that police officers wear. We replaced the steel with aluminum and developed a new connection system for the 2 sides of the handcuffs. As the engineers in our group worked on the product side, the management team developed the business/marketing plan for the product. We determined the market size, who the customers were, who are competitors were and what our competitive advantage was. We did not take the ideas past the classroom but other teams in class thought about getting patents. This was one of the best classes I took while at WNEC.

Week 9

This week we read an article about marketing metrics, "Managing the Marketing Metrics Portfolio". The article reviews different metrics that can be used to measure the efficiency of your marketing plan. Every company has a different mission and a different strategy, the metrics used must be in line with your mission and strategy. A company must understand their position in the market before determining their metrics. For example, a start up company will have different metrics than a mature company. The start up will need to adjust their metrics after a couple of years as their strategy will have changed. We can apply the concepts in the article to the Pharmasim simulation we are currently working on. In Pharmasim, it is important to understand who your customers are and what your position is in the market. Allround is the market leader is over the counter cold medicines so using market share as a metric would make sense. After working on the marketing plan for Pharmasim my team has decided to implement a premium pricing strategy. With this strategy in place we will not look at units sales for our metrics but instead use gross margin. We were operating over capacity which increased out costs of goods sold and hurt our gross margin. Another team might use different metrics to determine their efficiency.

Managing the Allstar Brands company in Pharmasim has been an interesting experience so far. As a team, Justin and I are working well together. The first few periods did not yield the results we were expecting. The biggest problem we had was that we did not have a defined pricing strategy at the beginning of the simulation and kept our price low. This resulted in high unit sales but our net income was not impressive at all. The high number of unit sales caused us to run over capacity and raised our costs of goods sold. After completing the situation analysis and marketing plan we have determine a better strategy for the upcoming periods. Justin and I realized what issues we were having and are on the same page about the decision we need to make in the future periods. We are hoping that this new strategy will help us improve on our metrics.

This week we were also asked to review the blogs of three other classmates. I decided to review Marty's blog first. I have been reading his blog every once in a while and like how he related class to working for Vermont Yankee. Some industries, like Marty's and mine working in construction do not always have a strong connection to Marketing. Justin also does a great job connecting college football to marketing. I liked Marty's blog because it is very detailed. He does a great job of connecting the various class assigned articles and outside articles to the class topics. Next I reviewed Andrew's blog. I liked that Andrew uses outside examples, especially the example of the car dealership with a niche market and their strategy. Andrew's blog was easy to read. Last, I review Ahmed's blog. Ahmed uses pictures and charts that relate to his posts that help explain what is going on. I thought that Ahmed's blog flowed very nicely through each of his posts and was quite detailed.

I thing I though of this wee while working on the marketing plan was distribution channels. Working in construction we do not have a product that goes through various distribution channels. However, we do have different channels that our submital process needs to go through. For various parts of the project we are required to submit cut sheets or shop drawing to the architect or engineer. The process starts with the subcontractor who is required to submit the cut sheets or shop drawings to us. These are then reviewed by the superintendents and project managers. The next phase is submitting them to the architect/engineer for review. The submitals are either returned as approved, rejected or more information needed. If a submital is approved the part is order and if its reject a new submital is required. These submitals need to through various channels before they are brought on site and installed.