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TMCVocabulary

TMC Vocabulary

pg.4

Compiled by Chris Halliwell, TMC Director

Economic Value Model

Economic Value Model EVM is used to calculate the net economic benefit of a product, and the resulting price that target customers may be willing to pay. The model establishes a reference value based on the closest competitive alternative, considers switching costs, and identifies product attributes that result in either negative Differentiation or positive competitive Differentiation.

Expected Product

Expected Product includes service and product attributes which reduce total cost associated with use of the Generic Product. Expected elements reflect concessions in the cost of doing business typically available from all suppliers in the category. Benchmark metrics for Expected Product performance are set by the category's best-in-class supplier, and are typically associated with investments in manufacturing, delivery and support infrastructure. Failure of the supplier to perform to benchmark metrics will result in loss of market share, reduction in price, or both.

Flanking Strategy

Flanking Strategy, the most innovative maneuver available to fight a marketing war, must be executed in an emerging market without an established Market Leader. The success of a flanking maneuver is dependant upon the traditional market share leader's reluctance to acknowledge and invest in the emerging market, and upon the rate of emerging market growth. Since success depends on the capture of new growth opportunity against an established competitor, the element of stealth, and then surprise, are critical to Flanking Strategy success.