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Creating New Market Space

The saying that “ nothing is constant except change” absolutely holds water especially n the marketing world. Every industrialist, entrepreneur, producer, trader keeps a close eye on their products and how they fare in the market. When demand for a certain product is low for some time, new marketing strategy has to be done ,a better or new alternative has to be adapted. Innovations partially or completely has to be done to improve marketability. This move is rather though for anyone in charge of marketing for competition is so stiff amidst globalization.

Finding a new market space is one of the best alternative to make a breakthrough in value especially if the space found for marketing is never been occupied by any product. An unoccupied territory will make a major breakthrough in sales. In finding anew Markey space existing patterns can be modified or be changed completely by innovations. Marketing strategies should not be predictable. It must be dynamic to keep abreast with demand’s behavioral patterns.

Most companies focus their attentions in beating other competitors. As a result, their strategies tend to take on similar dimensions as the others. They find strategies to compete with others. Several studies were done on how innovative companies can break free from the competitive pack by stacking out fundamental new market space, by creating products or services in which there are no direct competitors. This requires different competitive mindset, and a systematic way of looking for opportunities.
In Creating new market space there is a need to; 1)look across substitute industries, 2) look across strategic groups within its industry, 3) redefine the buyer group of the industry, 4) look across to complementary product and service offerings that go beyond the bounds of its industry, 5) rethink the functional-emotional orientation . The paper is about the rivalry in marketing innovations, strategies, alternatives and substitutes based on conventional marketing patterns and adoption of new ones that will last a life time and global. It provides a comparative analysis of the different principles in marketing and its implications.
The Market for United Kingdom Higher Education Institutions Higher Education in the United Kingdom includes nine kinds of institution, six- form colleges, tertiary education colleges, further education colleges, higher-education colleges and institutes, specialist colleges, adult-education colleges, privately owned colleges of education, universities and distance learning organizations. There are around 700 total institutions in the UK that excludes the adult-colleges. There were around 4. 8 million students in further education, in 2001/2002, and in higher education, there are 2.
1 million. That same year, the total estimated expenditure by the higher education sector is at ? 13. 5bn, and combined expenditure on further education and training at ? 6bn (Further and Higher Education: Market Report 2002). Looking Across Substitute Industries An industry does not compete with its own type but also with other industry that produces substitute products. The introduction of the Home Depots in the market did not only create a new space for home construction materials and furnishings but also caused a great increase in value in terms of price and quality of the product.
Competition is a healthy process if it results to innovations just like what marketing pattern Home depots created. The Home Depots gave birth to creative, self studied architects, engineers, interior designers, carpenters because of the do-it –yourself trends it introduced. This has been highly patronized due to cut in costs of building or renovating a house and its interiors. Home Depots offered free architectural advice because they often hire consultants or experts to help their costumers in their purchases.
The use of computer versus pencil as product substitute was discussed lengthily as it gave rise to the new value curve theory of Intuit. More people use pencil than I software because of its practicality, simplicity and affordability. Pencil cost much less that computer. Pencil to is and can be used by anyone and is accessible almost everwhere. In comparison, one needs to be a computer literate and financially able to buy and use a computer. Pencil is simpler to use while computer is highly sophisticated. A layman will think that it is unfair to compare the two for they are entirely different product but that is how industries go.
The law of product substitution applies for the value a consumer derived from it. The level of satisfaction a consumer gets is a major factor to be considered to make a product stay long in the local and global market. Current Business Models of UK Higher Education Institutions The Value Curve The Value Curve is a market based approach as compared to a resource based approach to strategy development. Explore through published writings the key dimensions of these two approaches. Looking Across Strategic Groups Within Industries
New marketing space can be found not only among substitutes but also across the same group of industry. Strategic groups are composed of group of companies having similar strategy. The ranks and /or order of strategic groups is affected by price and performance. The value return for the money spent for a certain product determines market stability and place. Most strategic groups try to maintain their position within the group but creating a new place in the market is done across the group by determining what causes the buyer to trade up or down from one group to another according to Kim and Mauborgne (1999).
The two has analyzed how Polo Ralph Lauren found a new market place in the fashion world when they perceive his clothing lines as “high fashion with no fashion”. Lauren was the first to take its brand worldwide by making a tremendous global sales exceeding $ 5 billion . He was at first downgraded by fashion critics but later followed by his predecessors. Still, price and performance count. Some sold their designs at a higher price but Lauren’s designs stability in the market space he found globally is mainly due to affordability and quality. Looking Across The Chain of Buyers
There are three groups of buyers identified whom companies or industries targeted for their products, namely, the purchasers who buy the products, the users to whom the purchasers bought the product for and the influencers who oftentimes are the advertisers or product promoters. There are segment groups of buyers who are target buyers of a certain kind of product. For example, pharmaceuticals and medical equipments are designed for doctors and allied medical professionals as well as hospitals and clinics, while concrete products and home builders’ depots are for building contractors and developers.
For pharmaceuticals, the focus is on the doctors who are the influencers, office equipments are focused on the purchasers and the clothesline and other consumer products like soap, food and others are focused on the users. Focusing the market on the three types of buyers above is a conventional way of establishing the market. Drifting away from the conventional method can open new market space like redesigning their value curves according to Kim and Mauborgne. They cited Bloomberg’s paradox of traders and analyst’s personal lives as he focused on the users of his product.
Users have strong buying power due to their high income but their lifestyle hinders their purchasing ability be cause of long working hours,they have less or little time to go on a buying spree. Other buyers of the same predicament, are now the target of the on line market or e- commerce. The on line trading has found its new market place and its target buyers are on the upper level of the society, who almost have no time to go out just to buy their personal needs like dress, computers, clothes, shoes by using their credit cards. This new market space increased the demand for credit cards. References:
“First Profit Making Company to Award Degrees”. The Guardian, 25 September 2007, educationguardian. co. uk Further and Higher Education: Market Report 2002. Key Note Publications Ltd. June 1, 2002. Johnson, G. and Scholes, K. Exploring Corporate Strategy, Seventh Edition 2004 (3) M. J. Baker, Marketing Management and Strategy 3rd Edition 2000. Kotler, P. , G. Armstrong, J. Saunders and V. Wong, Principles of Marketing, Fourth European Edition 2005. “The Brains Business”. The Economist, 8 September 2005. www. economist. com/research/articlesBySubject/displaystory. cfm? subjectid=2133650&story_id=E1_QPPJJGD.

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Wireline Services Market Trends

However, issues associated with the environment, and increased seismic activities have slowed down the growth of this market. The growth of hireling market is directly proportional to the on-going drilling and completion activities around the world. On the basis of various factors such as geological condition, type of reservoir, and others, different types of hireling services are required to assist the drilling and completion activities. The growth in drilling and completion activities is attributed to the continuous increase in world energy demand.
These activities are expected to grow further as the world energy demand from oil would reach around 4 GATE by 2020. This rise in energy demand has resulted in increased drilling and completion activities in all parts of the world. This has also put pressure to extract more from each well and thus, further deep exploration is done. This increase in drilling and completion activity increases the requirement of hireling services. Complete report [email protected] http://www. Aromatherapies. Mom/hireling-services- market-by-type-logging-well-intervention-completion-geography-Asia-pacific-Europe- idle-east-Africa- north-a America-south-name Rica- global I-tree nods-forecast-to-2019- market-report. HTML We have used various secondary sources such as encyclopedia, directories, and databases to identify and collect information useful for this extensive commercial study of the global hireling services market. The primary sources-experts from industry and suppliers have been interviewed to obtain and verify critical information as well as to assess the future prospects of the hireling services market.
We have also profiled leading players of this industry with their recent developments ND other strategic industry activities. These include Baker Hughes (U. S. ), Superior Energy Services (U. S. ), Hallucination (U. S. ), Sulzberger (U. S. ), and Weatherboard 2019 Hireling Services Market Trends & Forecast By glossaries The North American market share is about 45% of the global hireling services revenue. In North America, The U. S. Is the largest market and is led by Hallucination, Sulzberger, Baker Hughes, and Superior Energy Services.

Chinese players and few Asian players are expected to grow in the near future. The hireling services market is segmented in six regions, namely North America, South America, Europe, Africa, Asia-Pacific, and Middle East.

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How Ford Created a Huge Market by Lowering its Prices

The following excerpt is from Richard Koch and Greg Lockwood’s book . Buy it now from  | | 
Probably no one in business today can remember the earthquake caused by Henry Ford, and even in business schools, his case is rarely taught. But Ford’s story has priceless lessons for any ambitious entrepreneur or executive today.
When he was 45, and a moderately successful industrialist, Ford took a brave stand that shook the world. The decision not only created his fortune but made him a leading architect of the twentieth century and one of the most celebrated and influential people on the planet.

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Ford recalled the turning-point in his autobiography:
“What I am trying to emphasize is that the ordinary way of doing business is not the best way. I am coming to the point of my entire departure from the ordinary methods. From this point, dates the extraordinary success of the company. We had been fairly following the custom of the trade. Our automobile was less complex than any other. We had no outside money in the concern. But aside from these two points, we did not differ materially from the other automobile companies.”
When Ford had his light-bulb moment, several hundred rival entrepreneurs were making cars. They were much the same in background and activity: all engineers; nearly all product designers; all auto enthusiasts, entering cars in motor races and taking a keen interest in who won; and all making no more than a few cars a day. They sold them to the same type of customer, too — the only market at that time for cars — rich and leisured gentlemen, usually motor “nuts,” skilled in driving and maintaining their beautiful beasts. Ford, though not the market leader, was one of the biggest manufacturers, making around five vehicles a day.
But however conventional he appeared in 1908, there was always something odd about Henry Ford and his opinions. Though his whole industry was in the business of providing “pleasure cars” for the rich, Ford conceived a vision of something completely different.
To their horror, he told his salespeople: “I will build a motor car for the great multitude. It will be large enough for the family but small enough for the individual to run and care for. It will be constructed of the best materials, by the best men to be hired, after the simplest designs that modern engineering can devise. But it will be so low in price that no man making a good salary would be unable to own one — and enjoy with his family the blessing of hours of pleasure in God’s great open spaces.”
The idea of democratizing the automobile inspired Ford. His great insight was that the key was price. If he could make a car cheap enough, it would, he believed, sell in vast quantities. While it’s all very well to realize that price might be the key to expanding sales, how did Ford manage to keep his prices sufficiently low to create a new mass market? His first idea was to redesign the product and make just one standardized, simple model:
“In 1909 I announced … without any previous warning, that in future we were going to build only one model, that the model was going to be the ‘Model T,’ and that the chassis would be exactly the same for all cars … I thought it was up to me as the designer to make the car so completely simple that no one could fail to understand it. That works both ways and applies to everything. The less complex an article, the easier it is to make, the cheaper it may be sold and therefore the greater number may be sold.” 
So, by making a single product — for more than a decade, with few variations and options permitted — Ford could reduce his costs considerably. He also paid great attention to the materials that went into his cars. For example, he pioneered the use of vanadium steel, a French invention that was both very light and very strong — ideal to create usefulness for the customer. The vanadium steel disposed of most of the weight in Ford’s car — decreasing fuel consumption — yet actually cost less than the traditional alternative.
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The other plank of Ford’s low-price car was a new production system, geared to make vehicles at high scale and low cost. He built the world’s biggest factory — not just the biggest car factory — on a massive sixty-acre site at Highland Park, near Detroit. It opened on New Year’s Day, 1910, and the gain in productivity was marked: The average number of employees rose from 1,908 to 4,110, and the cars built from a little over 6,000 to nearly 35,000.
The real breakthrough came in 1913 with a proprietary innovation, designed by his production managers: the move from batch production to a continuously moving assembly line. The effect of simplification and scale was to move the price of a Model T down to $550 by 1914, when 248,307 of them were sold. By 1917, the price had fallen even further, to $360, with the result that sales soared to 785,432. In 1920, Ford sold 1.25 million Model T’s. Compared to 1909, a price reduction of 63 percent — to almost a third of the original price of the Model T, which was itself a good fifth cheaper than comparable cars — had resulted in a sixty-sevenfold increase in the number of cars Ford sold.
Simplifying made the company’s cars both easier and cheaper to make. And the price reduction was enormously effective in boosting the whole market as well as Ford’s share of it. By 1920, his share had soared to 56 percent, three times larger than that of his nearest rival, General Motors, which was an agglomeration of five different car brands. Ford was by far the most profitable car company in the world, both absolutely — relative to sales — and relative to capital employed.
Even Henry Ford himself was surprised by how much demand responded to the lower price. A price reduction to 35-40 percent of the original price boosted sales by more than 700 times. The fact is, the relationship between price reduction and demand expansion is asymmetrical. If you cut price by half or more, demand rises exponentially — by tens or hundreds or thousands of times.
Henry Ford’s example perfectly illustrates how cost and price reduction isn’t a one-off affair, but a gradual, continual process, fueled by a few big innovations — in Ford’s case a simplified car model, standardizing on one model and the moving assembly line — and a mass of smaller ones. Prices don’t have to be slashed in half immediately. Instead, a virtuous circle can be created, where the first cost reductions create a larger market and greater market share, with the benefits of greater scale subsequently lowering costs and prices and raising demand further. What’s essential, however, is a dogged commitment to achieve the lowest possible cost and price.
Key points
One way to create a huge new market — with a different type of customer, only able or willing to pay a much lower price — is to simplify your product so that it is much easier and cheaper to make, and hence sell.
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But in order to price-simplify, you need to reduce the price by at least 50 percent. This doesn’t need to happen all at once, but you need to continue cutting costs and prices each year — by about 10 percent a year.
Take a lesson from Ford:

Redesign your product from first principles, cutting out unnecessary or costly parts.
Reduce product-line variety and if possible standardize on a single “universal product.”
Reduce the number of components.
Eliminate frills and unnecessary options.
Use different, new, lighter and cheaper materials.
Go for volume and production facilities that are far larger than those of your rivals.
Organize tasks to maximize the specialization of your workforce.
Automate tasks.

If you’re a price-simplifier, cutting your prices is the primary objective. But, like Ford, you should also increase your product’s quality, utility and ease of use if this can be done without incurring extra costs.