STRATEGIC MANAGEMENT. Theme Porter’s competitive strategies. Cost leadership

Focus.

Dr. Prof. Aleksandr Kozlov
05/12/2016

customers behavior and buying motivation
Development of products satisfying the

real needs of target customer
Construction of own outlets to “keep hand” on customer pulse

location
Purpose of buying
Product Value for customer

Purchasing strategy (preference for familiar supplier, for the first one

that fulfils the buying criteria )
Structure of the decision-making process

Small Office, Home Office
VSB - Very Small Business
SMB

- Small Medium Business /SME - Small and medium enterprise
VALS - Values Attitude and Life-Styles
LOHAS - Lifestyles of Health and Sustainability
LOVOS - Lifestyle of voluntary simplicity
SAM - Segmented Addressable Market
VLE - Very Large Enterprise

year 1998 was not popular because of needs in diversification

to keep stability.
At the moment the process of focus and concentration is going intensively in markets of services (market researches, training, legal advices, etc) .

Russia's urban populations, particularly for such consumer goods as food,

cosmetics/toiletries, and household supplies, illustrate the role of the primary retail channels in Russia's grocery stores, produce markets, and supermarkets.
Currently, some 37 percent of such spending takes place at small, multipurpose grocery stores, while "wholesale" produce markets (or farmers' markets) account for 24 percent of such spending, and another 12 percent of these purchases are made at large-scale grocery stores, or supermarkets.

large-scale stores will become increasingly popular. However, most Russians outside

Moscow and other major cities still do their shopping at small grocery or convenience stores or other specialized stores because of their convenient location, as well as at consumer goods markets, because of low prices. At the same time, Russia is witnessing the rise of a new consumer channel--medium-sized discount supermarkets, such as Piaterochka, Kopeika, and Aldi in Moscow.

Moscow considered to have relatively high business development potential--including St.

Petersburg, Rostov, Krasnodar, Nizhny Novgorod, Tatarstan, Bashkortostan, Samara, Yekaterinburg, Krasnoyarsk, and Irkutsk.

in Russia may be greater than between neighboring European countries.

Companies considering entry into the Russian market in several regions should prepare not just one nationwide plan, but several business plans or a multifaceted plan to reflect the unique aspects and demands of different regions.
Russia’s current experience suggests that those who go to the regions first and use local resources effectively are most likely to become market leaders

foreign firms entering the market (most promising segments in Moscow)
“Innovators"

-. This group has higher than average consumer potential. Most of the group is under 30 years old, are business people and white-collar employees, live in major cities, and exhibit innovative consumer behavior. They prefer to spend their free time involved in sports activities and "active" leisure, and eat out in restaurants featuring exotic cuisines.

foreign firms entering the market (most promising segments in Moscow)
“Spontaneous”-

Single men who often buy goods impulsively dominate this group
“Ambitious" - Their consumer behavior is strongly inclined to innovations, although their consumer potential is much more moderate than the above groups. These consumers rely on advertising when looking for a product

foreign firms entering the market (most promising segments in Moscow)
”Тraditionalists”.

Their consumer potential is comparatively low, as consumer behavior is strongly traditional. Half of the group is comprised of retired individuals. The majority of these consumers are regular customers of retail outlets that have survived since the Soviet times.

foreign firms entering the market (most promising segments in Moscow)
"Self-realized"

Their consumer behavior is as traditional as that of the Traditionalists, but their consumer potential is high. These are mainly mature-age people. The women’s share is slightly greater. This cluster has the largest share of people disturbed or annoyed by advertising. These consumers value reliability and quality of goods. They pay great attention to health care.

foreign firms entering the market (most promising segments in Moscow).

“Settled” Their consumer potential is average or above-average. Their consumer behavior is rather traditional: novel products do not interest them too much, and their consumer preferences are already distributed among brands. Women dominate this cluster. Age and education corresponds to the sample’s average level.

firms entering the market (most promising segments in Moscow).
“Thrifty”

Their consumer potential is the lowest of all. Their consumer behavior is closer to being traditional. Half of them are above 50 years old, and their education level is lower than the sample’s average. For the most part the cluster consists of village and small town residents. The most significant argument for or against buying a product is the price factor. They can go through many retail outlets in search of the smallest discount. Another characteristic is that they often buy goods spontaneously.

of both thermal conductivity and phase transition to efficiently manage the transfer

of heat between two solid interfaces
At the hot interface of a heat pipe a  liquid in contact with a thermally conductive solid surface turns into vapor by absorbing heat from that surface.

by AVK)
Russian souls
Cossacks
Businessmen
Students
Kuptzi
Spiritual
Material
Collectivism
Cosmopolitanism

criteria
Brand orientation
Friends’ advices orientation

Traditions
Safety

Individualism

Cognition

cost minimisation everywhere (R&D, service, sales, purchasing)
Tight overhead control
Serving of

all major customer groups
High market share
Simple design for ease of operating

market share
Economies of purchasing from high market share
Usage of cost

advantages (Russian aspects)

leadership

Economy of scale
Cheap resources (only temporary, short term advantage)

on market places, small car repair stations (cost advantages in:

low cost labor, poor and cheap premises, shadow cash-flow, avoiding taxes)
Currently – retail chains, big food processing companies (cost advantages in economy of scale); regional producers (food, furniture etc., cost advantages in: low cost labor, cheap premises, local tax privileges)

works in construction
Transportation (by tracks and aircrafts)
Differentiated products
Software development
R&D in

some scientific areas

and devalue investments into existing manufacturing lines.
Entering of new powerful

competitors.
Changes in consumers preferences.