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System 1 (implicit system) playing the role of the autopilot, integrates perception and intuition and is designed for quick, intuitive decisions.
System 2 (explicit system), playing the role of the pilot, is slow and designed for reflection. The goal of good branding is to activate system 1 and lull the vigilance of system 2.
The implicit system affects our decisions through various elusive “effects”, such as:
The effect of the most beloved brand is based on the fact that people choose basically only the brand that they consider the number one for themselves.
Therefore, it would be more correct for marketers to strive for the maximum increase in the number of buyers for whom their brand is the first number in the list, and not just to get into the list of “suitable” brands
The framing effect is that a person draws different conclusions from the same information, depending on how the information is presented. The impact of the background is not recognized, although it indirectly affects the perception and thereby affects the decisions. A brand is a product frame.
Phil Barden gives an equation that describes the neurology of a purchase decision:
Pure value = pleasure – suffering
The higher the net value, the more likely the purchase. Because value and cost are relative, they can be influenced by the situational context.
For the brain, any object is a set of lines, faces, angles. Since the brain does not see complete pictures, it does not save them. A person’s ability to recognize familiar objects is based on signals carrying important diagnostic information.
Understanding what features of the brand help customers instantly recognize it, marketers can reasonably decide whether to change the background color and packaging or better to leave it unchanged. The main thing is to keep the key signals for diagnosis. Since people see products and brands primarily with blurred peripheral vision, signals that are effectively perceived even in blurred form should be used.
The perception of the product and the decision to purchase it depend not only on the offer itself but also on the way it is made. The interface influences the behavior of customers without having to change their beliefs in advance. This provides additional opportunities for marketers to influence customers outside the framework of the model in which they first have to change their attitude to the product or brand.
To fully understand buying behavior, you need to figure out what motivates people to make decisions from the beginning.
Products and brands are the tools with which customers achieve their goals. Marketers should create a sense of their product performing the tasks that the buyer faces. To determine the market, create new products and develop marketing strategies, you need to start from the goals of buyers, not their qualities and categories. The instrumental value of the product is higher if in a particular situation it is better than other products to cope with the task corresponding to the goals of customers.
Goals and their value are determined by two attitudes: explicit (common to the whole category) and implicit (common psychological goals). In marketing a lot of attention is paid to explicit goals, they allow you to create categories of products, so all companies in the market must meet them.
Implicit goals are hidden from consciousness and people simply cannot formulate them, so when customers are interviewed about products and brands, they begin to talk about explicit goals: quality, materials, price.
The tasks of products and brands are explicit, that is common to the whole category, and implicit – contributing to the achievement of specific psychological goals. Trade offers to create the greatest value for the client when explicit goals are associated with implicit ones.
There are two obstacles on the way to successful marketing activities: a strategy based not on the goals of customers, and signals that are used to convey a value proposition but do not activate the right ideas in the mind of the customer.
Positioning products and brands with a goal, we get clear instructions for action, because the associative memory of people contains signals related to the goals of the brand. The strategy based on the objectives not only provide the significance of the product but also, thanks to the associations between signals and goals learned by the brain, give instructions on how to submit the necessary signals.
If a brand is associated with multiple goals, the power of associative links to each of them weakens. It is desirable for marketers to focus on one goal and present everything as if their brand is the best in this respect.
Phil Barden’s book explains why people buy a particular product, why some brands are successful and some are not. After reading it, you can discover something new not only about marketing but also about the work of our brain, our perception.
This book is full of examples, illustrations, explanations of complex things in simple language. After reading you begin to look closely at the surrounding goods, you notice how these or other products are trying to get into your brain and they do it.
The book will be interesting for the average person, it will help to understand what processes occur in our brain when deciding on the purchase of goods, what means can affect our choice. And for the marketer it is a kind of encyclopedia with examples of how to and can be done, and how not to do.
https://bit.ly/3PBAwXI
В статье рассмотрим чистую прибыль, формулу расчета, определение и ее роль в финансовом анализе предприятия. Знание значения чистой прибыли позволяет руководителям предприятий оценить эффективность деятельности за отчетный период. Чистая прибыль оказывает большое влияние на будущее развитие предприятия, на ее конкурентоспособность, инвестиционную привлекательность, платежеспособность и финансовую надежность.
Инфографика: Чистая прибыль предприятия
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Concerns over technological disruption, globalization, growing inequality, and the environment are ubiquitous. Despite these challenges, we believe businesses can sustain growth at an affordable cost, not just to the business but to society and the planet as well if the (growth) gaps are closed.
Our motto: Profit can be meaningful, provided that it serves a purpose.
ROUNDMAP™ IS A CREATION OF EDWIN KORVER, CEO OF CROSS-SILO BV, THE NETHERLANDS
Studies show that 80% of organizations fail to achieve their desired growth targets in terms of revenue and profitability. Closing the growth gap ─ the gap between growth aspirations and growth activation ─ is one of the applications of the ROUNDMAP.
A growth gap may occur due to:
To appreciate a level of growth that is both attainable as well as serviceable, we’ll have to make sure that any misconceptions about growth, the growth traps, often caused by inadequate market research, are removed from the equation. This will give us the green line. If current growth does not match the green line, we’ll need to consider what causes the growth gaps (the misconfigurations).
By assessing the operation, ROUNDMAP Certified Professionals will be able to reveal what causes these gaps. This brings forth an actionable plan which may include changes to be made to the infrastructure, business strategy, business model, market segmentation, partnerships, revenue streams, marketing strategy, cross-functional collaboration, individual mindsets, or the customer development process.
While the Corona crisis may be a once in a lifetime occurrence, shock effects are far from exceptional. During one of our assignments, we identified a single point of failure (SPoF) in our customer’s value chain: the company sold 90% of its merchandise via one channel. We were able to convince the CEO to mitigate the risk and offered to transform the out of date website into a fully integrated webshop. When the SPoF gave way, revenue dropped by 90% and everyone panicked. But we came prepared and sales rebounded within days.
About 10 years before the event, we had to deal with a similar shock effect ourselves. As a serviceprovider, we rented a large number of server racks in a datacenter, some IP-space, and an internet uplink; all from one supplier. When we received a call from the datacenter that our supplier had filed for bankruptcy, all hell broke loose. It took five days and nights of relentless efforts and a lot of capital, to untangle our operation and make it out of this trap alive. It was a tough lesson to learn but since then, SPoF’s are a red alert on our radar.
As forementioned, ROUNDMAP is designed to drive sustainable growth. The difference between sustaining and sustainable growth is that sustaining growth means to keep growth at a certain rate, regardless of the costs, while sustainable growth is the ability to sustain growth at a rate that doesn’t require the firm to sell its stakeholders short ─ we prefer to call this EQuitable Growth.
EQuitable Growth aims to:
by means of:
Both McKinsey and IFF* encourage senior executives to pay equal attention to ‘Three Horizons of Growth’ (Horizon model):
See image below:
Our perception of growth is slightly different. We believe growth should be perceived as ‘situational’ ─ given the internal and external forces ─ which has led to the belief that Situational Growth™ (compare: Situational Leadership) has four ways of manifesting itself:
During each of these manifestations, a gap may occur: we may overlook profitable revenue streams, try to expand the wrong ones, or start change-initiatives while we should initiate transformation, and so on.
While the primary concern of management is to operate existing product-market centers as cost-effective as possible, ensuring predictable outcomes (high quality, a responsive customer service, etc.), revenue may suddenly turn south, changing the situation we’re in. During Expiration phase, it is the responsibility of leadership, besides defending existing revenue streams, to encourage creatives and fund innovators, operating at the edges (Red Monkey by Jef Staes) of the organization, to explore new opportunities for growth.
Mastering Situational Growth™ or Situational Mastery™ focuses on developing transactional and situational awareness to drive corporate Performance Readiness, while Situational Leadership®, developed in the eighties by Paul Hersey and Ken Blanchard, focuses on the relationship between leaders and followers, to increase individual Performance Readiness.
To select the most effective style of corporate leadership, we’re using the term Conditional Leadership™. It suggests that to lead a company in a certain timeframe, and given the internal and external conditions that may influence the business, the style of leadership needs to adapt.
These two frameworks, Conditional Leadership™ and Situational Leadership®, will greatly determine a firm’s capacity for Growth Activation™ *.
Growth gaps are often the result of a series of misconfigurations. We’ve addressed some of these gaps in more detail here: Mind the Growth Gaps. It is important to realize that every gap has an adverse effect on the desired outcome that will not go away until it’s identified and dealt with. Compare: Growth traps are misconceptions about growth opportunities.
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Even if you are not familiar with the (eight) principles of excellence, mentioned in In Search of Excellence by Peters and Waterman (1982), you shouldn’t be surprised to learn that the way successful companies operate today resembles those that were researched by the authors. Indeed, as the renown economists, Schumpeter and Kondratieff uncovered, history tends to repeat itself in so-called business cycles.
The organizations that were deemed ‘excellent’, such as Texas Instruments, IBM, McDonald’s, and Hewlett-Packard, were extremely nimble and entrepreneurial, had a strong culture, were customer-driven and human-centric, highly disruptive, and often very effective ─ they were true frontrunners; much like their present counterparts, Microsoft, Google, eBay, Amazon, Netflix, and Tencent.
Today, we’re seeing a similar approach, driven by fleeting competitive advantages, which is now referred to a Venture Design (VX):
The VX-approach is to intentionally set out to conquer a market, based on opportunities for growth that have not been explored before ─ by anyone. It doesn’t perceive the core competences as a holy grail. On the contrary, employees are allowed to explore any opportunity, as long as it serves a real customer need and is highly scalable.
Compared to the Horizon Model: these brave companies choose to ignore Horizon 2 and jump straight in Horizon 3, with Agility, Creativity, Determination, and Courage (AC/DC).
In Systems Theory: “A system is said to be in a transient state when a process variable or variables have been changed and the system has not yet reached a steady state.” In other words: a system is in a transient state as long as it is in a change state.
Before you jump on the VX-bandwagon, consider the fact that a multi-core operation does increase complexity dramatically. More on this subject can be found here: Where to find future growth?
"Fast and roughly-right decision-making will replace deliberations that are precise but slow."
~ Rita McGrath, Harvard Business Review
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