Spitting Images: Pioneer Center, May 2007

Sem-End Bash with Marketing Management Class
24 May 2007
Pioneer Center, Mandaluyong City





- Images by Noreen -

Review: "Marketing Warfare"

Marketing Warfare
By Al Ries and Jack Trout

Marketing Warfare describes strong concepts that are essential in crafting strategies of a business. By learning practical military plans in crafting business moves, I, the reviewer, was able to see how revolutionary plans can be made effective not simply by combating competitors, but also by focusing more on a competitor’s weakness, rather than just the strengths.

Ries and Trout explain four (4) key military strategies or marketing principles: the defensive warfare, offensive warfare, flanking warfare and guerrilla warfare. Use of these strategies depends on the goals and position of the strategizer in the market. The reviewer will go over these tactics and present his views/ideas of them. Simultaneously, given the huge potential of carrying out new ways of marketing products and services here in the Philippines, the reviewer will study local Filipino examples in light of these strategies.

The first principle is the defensive warfare. This marketing principle is designed to protect a company’s market share, profitability, product positioning, and the like. As a market leader, the best defense a business can do is to be always vigilant in scanning for potential attackers, attacking its weak points, and building itself anew. In the Philippines, a good example of a company applying this principle is the Shoe Mart (or SM). Henry Sy’s malls would not have become the country’s leading retail avenues, if SM’s managers were unsuccessful in defending their position in the mall industry. In the midst of the accumulation of malls such as Robinson’s Galleria, Glorietta, the Landmark and Gaisano, among others, SM tries its best in retaining its market leadership by erecting more and more malls in more and more locations.

The second principle is the offensive warfare. Essentially, this type of strategy is used to obtain an objective from a target competitor. This marketing tactic best fits the 2nd (or 3rd) top company in the market, whose goal is to beat “the best”. In doing this, an offensive player may have to design plans to obtain key customers, high margin market segments or high loyalty market segments. Philippines’ number one media network, the ABS-CBN Broadcasting Network (or simply ABS-CBN), is constantly being threatened by its head to head combatant, GMA Network (or simply GMA). As the second largest player in the Philippine broadcasting market, GMA casts offensive moves against ABS-CBN by patterning its shows (morning, noon time and prime time) to the latter. In so doing this, GMA is able to capture the same market as ABS-CBN, seamlessly. To date, because of GMA’s effectiveness in launching offensive attacks on ABS-CBN, the former is regarded as the number one network company in Metro Manila. GMA’s success enabled ABS-CBN to spend heavily in regaining its dominance in the metro by offering better shows that were adopted from shows of the same franchises abroad, i.e. “Deal or No Deal” and “Pinoy Big Brother”.

Following the principle of offensive warfare is a strategy that the reviewer believes as the most intelligent of all four warfare tactics: flanking. Businesses apply this type of strategy in order to minimize confrontational losses against strong competitors. Because the presence of big market players imposes huge road blocks to many small powerless competitors, identifying uncontested areas to run a marketing campaign is a better option than to attack large companies in the market, head on. The Philippines has been a witness to the Cola Wars, specifically the rivalry between Coke and Pepsi. Concealed behind their view, is a wise cola company that “sips a different drink”. Its name is Pop Cola. By flanking with low price soft drink (with a comparable taste to Coke), Pop Cola was able to gain considerable market share. Moreover, while it gained market share coming from Coca Cola’s segment (i.e. the older segment of the population who love the taste of classic Coke) and Pepsi’s market (i.e. the new generation), it did so indirectly by strengthening its position with the low-end (low income) drinkers, old and young. Luckily for flankers like Pop Cola, their strategies are done stealthfully, such that their major competitors are not threatened enough to respond to their moves decisively.

The last military principle is the guerrilla warfare. With this type of principle, the attacker wears-down the enemy by engaging in small attacks to target the competitor’s weak points. To understand this principle better, Marketing Warfare illustrates the idea of a guerrilla. It explains that a “guerrilla tries to reduce the size of the battleground in order to achieve a superiority of force.” Once the battleground is reduced (by concentrating on a niche or a segment that can be defended against the market leader), attacks by a small company turn into big attacks. In the Philippines, a popular example of a company launching a guerrilla attack is Zagu (known for its black pearl shakes). Zagu was able to create a unique territory in the market by creating a new product that has not been the focus of major grocery stores and fast food chains. Although believed to be a fad, Zagu franchise stalls continue to be prevalent and more popular than other sellers in the “shakes industry” today, owning against shakes products of Quickly, Orbitz and Greenich, and even floats products by Jollibee and McDonald’s.

Truly, the four (4) principles of actual warfare, i.e. defensive, offensive, flanking and guerrilla, can be translated into practical business strategies. Understanding these strategies is critical in today’s developing markets whose complexities are shaped by increasing number of players, varying company objectives, wide array of customer demand, increasing information, and advancements in technology. The reviewer deems that key strategic business planning via these principles will greatly enhance a company’s competitive advantage over its competitors.

Review: "Rich Dad, Poor Dad"

Disclaimer: This book review will focus on the reviewer’s personal insights about the book in general, covering especially the lessons he learned from the author, Robert Kiyosaki.


Rich Dad, Poor Dad
By Robert Kiyosaki

Rich Dad, Poor Dad narrates the story of Robert Kiyosaki’s two dads—a rich one and a poor one—who molded him to have the skills (particularly the skill he calls financial intelligence) he has developed over time. The contrast between his two dads provided readers with important perspectives on how to deal with money. The reviewer has highlighted four (4) general insights from the story, which he will discuss one-by-one:

1. Risk-Taking
2. Market Awareness
3. Education/Literacy
4. Open-Mindedness

Risk-Taking

More than teaching its readers about money, Rich Dad, Poor Dad educates its audience on how money can work for them. The idea here is to generate passive income by means of investment opportunities such as real estates, stocks or small businesses. Of course these activities require money shelling out of one’s pockets. Sad to say, most people simply rely on saving money, and become ever afraid of investing it in better financing vehicles. The reviewer agrees that when the objective of a person is to raise money passively, that person must be willing to bet his money for his goal. This is the secret of many rich people, yet neglected by middle and low income earners. When a person’s Big Hairy Audacious Goal (BHAG) is to be wealthy, then that person should have the guts to be creative in “playing” with his money. Else, BHAGs will remain as BHAGs, and the dream to be rich will remain to be a forever a dream.

Market Awareness

The movement of money is possible through trade.

Trading involves the exchange of activities between buyers and sellers.

A system of interaction between buyers and sellers is called a market.

Logic tells us that money flows are generated in the market. The larger money the person would want to generate as income, the more he needs to understand the trading activities in the market. Kiyosaki shares a very practical advice on how he was able to benefit from the real estate business. By jogging around his neighborhood and look at profit potential buildings/apartments being sold at a bargain, he was able to find opportunities that are hidden from the naked eyes of many people. He also did these by examining real estate trends in his area. Clearly, research and awareness of market patterns provide greater advantage to a person in trade.

Education/Literacy

The reviewer concurs with the writer that success in wealth should be built around the foundations of financial literacy. He also believes that financial education should start at an early age. This, of course, does not exclude academic education (in school) which will strengthen the basic knowledge of a person in terms of essential skills. After school education is more learning. And after more learning, is even more learning. Indeed, if one’s will is to be financially independent, what better way to start this than to begin accumulating financial wisdom by reading business magazines/journals, literary texts, articles, researches and other statistical data that are available everywhere; building communications with a different kinds of people; and applying one’s learning in the process of obtaining an ideal financial status. Truly, the more learning a person gets, the greater ammunition he will carry in achieving his goals.

Open-Mindedness

Finally, having an open-mind allows us to evaluate any issue, problem or dilemma without bias. The essence of debates (may that be on the war in Iraq, gay marriage, globalization, North Korea’s nuclear energy development or growth of the Chinese and Indian markets) is exactly the same as this. When a person enters into a debate, the person should not be restricted to his position, but should also be aware of the arguments of his opposition. In doing this, the debater can explore possible loopholes in the arguments of his opponent (thus, he has a counter-argument). Akin to a debate, building financial insights also requires open-mindedness. Rich Dad, Poor Dad revolves around this perspective by inculcating in the minds of the readers the benefits of having two conflicting viewpoints about money: either we allow ourselves to work for money, or allow money to work for us. Although the reviewer thinks that Rich Dad, Poor Dad has a bias more in favor of the rich dad, the book was still effective in that it inspires readers not to be limited in their own poor-dad-way-of-thinking.

Nah...

Apparently, I can't wait to post blogs again. I'm taking back what I said in the previous post. Sorry.