2. About me
Alex Pavlenko is the CEO and founder of Zeus Electronics Company. He
has a rich background in science and marketing, with over 10 years of
“field” experience in such areas as mobile applications, embedded solutions
for telecom, multimedia and automotive industries, new product launching,
holding degrees in applied mathematics, marketing and finance.
…..
Start-up team member of launching Luxoft operations in Ukraine
Establishment of embedded line of business for Luxoft
Start-up of Baymark, one of remarkable players of embedded market with
offices in Odessa and Kiev, which later was acquired by Luxoft.
Start-up of Zeus, mobile apps and mobile based solution company, which
successfully delivered more than 500 apps to market
Start-up of ZeRadio, mobile multimedia system with 1M users worldwide.
3. General View
Many factors need to be considered, including: an idea’s
market potential, the competition, financial resources,
and one’s skills and interests
Why would a consumer choose to buy products or
services from this new firm?
One important factor is the uniqueness of the idea
It is best to avoid an entry strategy based on low cost
alone
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4. General View
Successful entrepreneurs often distinguish their ventures
through differentiation, niche specification, and
innovation
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5. Diffrentiation (anti comodity)
When differentiation is successful, the new product or
service is relatively less sensitive to price fluctuations
because customers value the quality that makes the
product unique
(anti
comodity)
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6. Niche Product
Niche specification is an attempt to provide a product or
service that fulfills the needs of a specific subset of
consumers
By focusing on a fairly narrow market sector, a new
venture may satisfy customer needs better than larger
competitors can
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7. Principles of Innovation
Begin with analysis of opportunities
Innovation as conceptual and perceptual
Simple and focused
Start small
Aims at leadership
8. Innovation
Visionary business expert Peter F.
Drucker explained innovation as “change
that creates a new dimension of
performance”
There are two main types of product
innovation
Pioneeringor radical innovation
Incremental innovations
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9. Closure ;)
Entrepreneurs in less-developed countries often
innovate by imitating and adapting products created in
developed countries
Drucker called this process “creative imitation”
Creative imitation takes place whenever the imitators
understand how an innovation can be applied, used, or sold
in their particular market better than the original creators do
Innovation, differentiation, and/or market specification
are effective strategies to help a new venture to attract
customers and start making sales
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13. Market Position
Market Niche – small part of an existing market
Market Leader – maintain dominant position in
the market?
Market Follower – Follow the lead of the market
leader – pricing, product development, etc.
Market Challenger – Seek to adopt strategies
to challenge market leader’s position
15. Market Objectives
Will involve/determine some or all of the following:
Market Penetration
New Product Development
Branding
Diversification
SWOT Analysis
Product Portfolio – Product Life Cycle, Boston Matrix
19. Focus Strategies
Focus strategy based on low-cost
Concentrate on a narrow customer segment beating the competition on lower
cost
Focus strategy based on differentiation
Offering niche customers a product customized to their needs
Overall objective of both focus strategies is to do a better job of serving a
niche target market than competitors
Keys to success
Choose a niche were customers have a distinctive preference, unique needs or
special requirements
Develop a unique ability to serve the needs of a niche target market
20. What Makes a Niche Attractive?
Large enough to be profitable
Good growth potential
Not critical to the success of major competitors
Organization has the resources to effectively serve the niche
Organization can defend itself against challengers through a superior ability
to serve the niche
No competitors are focusing on the niche
21. Strengths and Risks of Focus Strategies
Strengths
Competitors don’t have the motivation to meet specialized needs of the niche
Organization’s competitive advantage could be seen as a barrier to entry
Organization’s competitive advantage provides an obstacle for substitutes
Organization’s ability to meet the needs of customers in the niche can reduce
the bargaining power of large niche buyers
Risks
Broad differentiated competitors may find effective ways to enter the niche
Niche customers’ preferences may move toward the product attributes desired
by a larger market segment
Profitability may be limited if too many competitors enter the niche
22. Diversification
Use when entering new industries
Acquire an existing company in the target industry
Start a new company internally
Form a joint venture