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Introduction to Marketing Strategy Objectives & Process

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EMBA Pro Marketing Strategy Solution for Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo case study


Famous for the hit game 'Angry Birds', game developer and entertainment company Rovio is an example of outstanding entrepreneurship. This case analyses the factors that made its base in Espoo, Finland, an attractive place and contributed to the start-up's overall success as it became a world leader in mobile gaming.


Case Authors : Sami Mahroum, Elizabeth Scott

Topic : Innovation & Entrepreneurship

Related Areas : Entrepreneurship, Ethics, Influence, Technology

EMBA Pro Marketing Strategy Approach for Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo


At EMBA PRO, we provide corporate level professional Marketing Mix and Marketing Strategy solutions. Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo case study is a Harvard Business School (HBR) case study written by Sami Mahroum, Elizabeth Scott. The Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo (referred as “Rovio Espoo” from here on) case study provides evaluation & decision scenario in field of Innovation & Entrepreneurship. It also touches upon business topics such as - Marketing Mix, Product, Price, Place, Promotion, 4P, Entrepreneurship, Ethics, Influence, Technology.
Our immersive learning methodology from – case study discussions to simulations tools help MBA and EMBA professionals to - gain new insight, deepen their knowledge of the Innovation & Entrepreneurship field, company, context, collaborators, competitors, customers, Marketing Mix factors, Products related decisions, pricing strategies and more.

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Marketing Strategy Introduction


For successful marketing strategy at Rovio Espoo, the marketing managers need– understanding of customers’ fundamental needs and drivers of those needs, conceptualizing products and services that can meet those needs and are feasible in Rovio Espoo financial and intellectual resources, and finally developing marketing mix for entire go-to market strategy.

Objectives of Different Types of Marketing Strategies


Increase sales of Rovio Espoo – The goal of marketing efforts is to increase sales of the present products. It may involve selecting a new target segment or positioning an existing product differently to a new segment.

Introduce a new product or service of Rovio Espoo – It is the traditional function of marketing mix – launching a new product and communicating its features, superior value proposition, and uniqueness.

Better establish the brands of Rovio Espoo – Brand awareness and positioning is one of the critical objectives of marketing and often organization spend a significant part of marketing budget on brand positioning.

Bring in new customers to Rovio Espoo – It may involve launching version of product that can appeal to new segment of customers or entering into new markets.

Increase market share of Rovio Espoo – Marketing efforts can be used to increase market share either by driving increase in sales to new customers or by driving higher sales to existing customers.

Improve customer loyalty of Rovio Espoo customers – Marketing efforts can be used to increase loyalty among existing customers by organizing events, and by providing post purchase information and services.

Get existing customers of Rovio Espoo to buy more – It often involves selling accessories along with the existing products or increase the usage rate of the existing products. Increase usage rate is comparatively a difficult task even with a war chest of huge marketing resources.


Definition of Marketing


According to American Marketing Association (AMA) – Marketing is a set of activities that an organization (both for profit & non-profit) undertakes to create, communicate, deliver, & exchange products & services that have value for the - customers, supply chain partners, clients, other stakeholders, and society at large.
Kotler in his book “Principles of Marketing” explains - Marketing is a process through which firms such as Rovio Espoo can create value for its current and potential customers, build relationship, and sustain that relationship by continuously meeting their needs.


Five Stages of Marketing Strategy Process


Over the last decade the traditional role of marketing has diminished with the rise of artificial intelligence driven algorithms that provides marketers an easy to measure tool based on impression, clicks, and other behavioral aspects. But one thing that has been lost in this easy to measure culture is – The power of marketing functions to create new markets and customer segments. At EMBA Pro, we believe that power of creating new markets still holds great potential for marketers in both digital world and traditional media.
The five stages of Marketing Strategy Process of Rovio Espoo are -
Step 1 - Marketing Research & Analysis
Step 2 - Segmentation, Targeting & Positioning Decisions
Step 3 - Marketing Plan
Step 4 - Designing a Marketing Mix using 4Ps - Product, Price, Place & Promotion
Step 5 - Sustaining Value through Post Purchase Services


Step 1 - Marketing Research and Analysis


The first stage of the marketing process at Rovio Espoo is to do research and analysis to identify unmet and even unknown customer needs. A good point to start for the research and development is to conduct a 5C Marketing Analysis . The 5C Marketing Analysis framework comprises –

Customers Needs– What are the needs that Rovio Espoo seek to satisfy. Who are the present customers and who are the potential customers for the new product or service.

Company – What are the resources and special skills that Rovio Espoo needs to possess to create products that can fulfill the needs of the prospective customers. Check out the detailed SWOT Analysis for Rovio Espoo on the following page.

Competitors – Who are the competitors in the target market and what value proposition they are offering in the market place. Do they possess enough financial and knowledge resources to develop new products to compete with Rovio Espoo.

Collaborators – What sort of supply chain and value chain partners Rovio Espoo needs to develop and deliver new product to final consumer. What are the respective bargaining powers of value chain partners.

Context – What are the macro and micro environment factors that impacts the business environment in which Rovio Espoo operates in. You can check out PESTEL analysis of Rovio Espoo in greater detail on the following page.


Step 2- Selecting Target Customer Segment


The second step of Marketing Process after completing the 5C analysis is – Selecting the Target Market. It requires three steps –


Segmentation


Market segmentation is the process through which marketing managers at Rovio Espoo can divide the large market into smaller segments based on distinct needs, characteristics, or consumer behavior. Rovio Espoo can do segmentation based on following criteria – geographic, demographic, usage, user status, income, lifestyle, value proposition priorties, benefits sought, loyalty status, gender, social class, self-perception, psychographic factors, and other attitudes.
One of the most widely used multivariate segmentation system is – PRIZM, developed by Claritas. It is widely used by various marketing and advertising agencies. It comprises 68 customer segments based on the US Household Purchasing Preferences data.


Targeting


Once the overall market is divided into various segments then Rovio Espoo needs to choose a target segment or few target segments. The key is not to be everything to everybody as the products can only deliver specific value proposition.


Conducting a Segment Attractiveness Analysis


First step in the targeting process is to conduct a Segment Attractiveness Analysis. Under the Segment Attractiveness Analysis all the segments are evaluated based on the following criteria –

Maturity of the market – For example within the car industry the SUV category is more mature than Electric Vehicle market, so the margins can be very limited in the SUV category but the demand forecasting is easy. On the other hand EV division can have higher margins because of lower competition but the demand forecasting can be a difficult process.

Mode of competition and business models – Sometimes the way competitors compete shape the whole landscape of an industry. For example email can easily be - paid product- , but organizations chose to make it free products to increase customer base and lure in advertisers. So if Rovio Espoo is trying to enter a segment where revenue from other division is financing the core service then it has to build a requisite business model where revenue is driven by an adjacent or related product and service.

Profitability in various segments – Some segments often have higher margins compare to another as explained in the automobile industry example above.

Customer behavior and loyalty analysis – How customers are behaving in each segments and are there opportunities of over lapping. Loyalty behavior analysis is also a critical factor in analyzing the conversion rate if the Rovio Espoo core strategy is based on attracting existing players’ customers.


Differentiation & Positioning


Differentiation process involves how Rovio Espoo is differentiating its products and services in the market place compare to its competitors. Positioning is the position of the brand or Rovio Espoo products in minds of target customers – based on distinctive features, qualities and functions.


The differentiation and positioning task at Rovio Espoo require marketing managers to do -

Identify competitive advantage or unique value proposition on which position the brand in the mind of the consumers.

Choose competitive advantages that are most compatible with Rovio Espoo marketing strategy. Marketing managers at Rovio Espoo can make perceptual maps to better understand competitive positioning of various brands in the market place.

Finally Positioning the brand as a deliverer of superior value to the target segment and effectively communicating that position to consumers using marketing mix and promotion mix.

You can also check out EMBA Pro - 5C Marketing Analysis of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Step 3- Making a Marketing Plan


1. Objectives of the Marketing Plan : There are various objectives for which Rovio Espoo marketing managers can make marketing plan – New product launch, repositioning of existing brand, targeting new customer segment, entering international markets etc.

2. Marketing and financial goals and objectives: The second step is to correctly assess how much financial resources will be required to execute the marketing plan. It involves resources spent from product development to building a communication strategy mix.

3. Marketing mix: Building a marketing mix based on the marketing plan objectives and limitations imposed upon it by the financial resources.

4. Marketing budget: Budget each prospective activity that will be under taken under marketing mix strategy.

5. Monitoring and evaluating performance: Carefully monitor each marketing mix activity and analyze the target performance with the actual performance. Which media vehicles are performing better compare to others etc. This will help in making changes and adaptation as we go along.



Step 4 – Four P's of Marketing Mix & Go-To Market Strategy – Capturing Value

Guided by marketing strategy, the company designs an integrated marketing mix made up of factors under its control—product, price, place, and promotion (the four Ps of Marketing Mix). To design the best marketing strategy and mix, Rovio Espoo should closely adopt the Four Ps of Marketing mix in accordance with trends and forces in Rovio Espoo ’s marketing environment.

Product - Understand the deep-seated drivers of perceptions and behavior of consumers and develop a product that appeal to those drivers.

Place – Evaluate the buying behavior and distribution channel costs to make a channel decision.

Promotion - Engage with customers through use cases and benefits instead of functionalities and features. Communication should be focused on experience rather than product features.

Price – Price is often determined by marketing strategy, cost structure of the company, competitive positioning of firm, brand positioning, and various other factors. If the business model is built on conversion of existing customers then Rovio Espoo needs to arrive at a price through research at which the present customers are willing to switch to a new brand.


Step 5 - Post Purchase Services – Sustaining Value

Even though the number varies, the efforts taken to gain new customers are far more and costly than those to keep the present customers loyal. Post purchase services are critical to foster loyalty among the customers. Various ways in which Rovio Espoo can improve the post purchase experience of the existing customers –

Building communities where customers can share experience and help other customers.

Providing regular maintenance services and spare parts, if the customer needs them.

Providing installation and other related services.

Taking regular feedback from customers and asking them how certain features can be enhanced.

Providing product care tips.

Post purchase services are critical not only to foster loyalty among the customers but also to get continuous feedback and improve the products.


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5C Marketing Analysis of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

4P Marketing Analysis of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Porter Five Forces Analysis and Solution of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Porter Value Chain Analysis and Solution of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Case Memo & Recommendation Memo of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Blue Ocean Analysis and Solution of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Marketing Strategy and Analysis Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

VRIO /VRIN Analysis & Solution of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

PESTEL / STEP / PEST Analysis of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

Case Study Solution of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo

SWOT Analysis and Solution of Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo


References Books on Marketing Strategy

Kotler & Armstrong (2017) 'Principles of Marketing Management Management', Published by Pearson Publications.
W. Chan Kim and Renée Mauborgne (2017) Blue Ocean Shift: Beyond Competing - Proven Steps to Inspire Confidence and Seize New Growth, Sep 26, 2017
W. Chan Kim and Renée Mauborgne (2015) Blue Ocean Strategy, Expanded Edition: How to Create Uncontested Market Space and Make the Competition Irrelevant, Jan 20, 2015
Sami Mahroum, Elizabeth Scott (2018), 'Rovio Entertainment: A Case Study of How Rovio Derived 'Place Surplus' in the Finnish City of Espoo Harvard Business Review Case Study. Published by HBR Publications.

M. E. Porter, Competitive Strategy(New York: Free Press, 1980)

Note that RoboRealm runs on your PC and communicates to the Rovio over the 802.11 wireless protocol. This means that you will see what the Rovio sees on your PC screen.

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What can you do once RoboRealm is installed with the Rovio Robot? Here's a couple possibilities that you can load and run in RoboRealm:


Image Enhance One of the issues that plagues the Rovio (as also remedied via hardware in this Hackaday article) is the high lighting requirements needed in order to see anything through the camera. During the daytime the image works well, but towards the evening or in artificially lighted rooms the camera image produced is of very low contrast and lighting. Simply using the Rovio module with the 'Enhance' checkbox selected improves the image quite a bit!

Keyboard Driving Want to just drive your Rovio around using your PC keyboard? Try this robofile out to understand how to trigger movements based on keypresses in RoboRealm.

Joystick Driving If the keyboard is not your desired interface try the joystick control instead. The joystick is superior to the keyboard driver as it can specify different speeds based on the tilt/pan of the joystick. This allows finer control over your Rovio than just using keypresses.

Chasing Light A natural behavior of most animals is to avoid or target light. For example, after a pigeon accidentally flew into our building it kept trying to fly up towards the ceiling and bumping into the overhead fluorescent lights. It would determine that the way was blocked and would try the next light in an effort to fly towards the light (assumed sunlight) and escape the confines of the building.

Radar Avoidance The Rovio has a built in Radar or otherwise known as an IR (Infrared) Distance sensor that will trigger when an object gets close to the front of the robot. Using this simple sensor you can implement a nice obstacle avoidance routine that steers the Rovio away from harm.

Laser Steering A fun way to steer the Rovio using a laser pointer. Point the laser within view of the Rovio's camera and it will attempt to move towards the laser.

Chasing Movement Detecting movement is also a useful behavior for a robot to have. The issue with mobile robots is how to remove the movement caused by the robot versus what it moving independently.

Finding a Bullseye Target Thinking about an indicator for a homebase for the Rovio? A bullseye has some nice properties that can easily be exploited to extract it out from a scene even when moving.

Want more? Check out the videos on YouTube that demonstrate other capabilities of RoboRealm.

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