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| FROM Kellogg MBA Blog: The sandwich strategy |
![]() First-year student Rohan Rajiv is blogging once a week about important lessons he is learning at Kellogg. Read more of his posts here. A case study on “The sandwich strategy:” Federal Express (FedEx) created an overnight delivery service toto compete with the United States Postal Service (USPS). Responding to FedEx’s entry and early success, USPS created a product called Express Mail priced at $8.95, as compared to FedEx’s $12. FedEx, had it been like most companies, would have reduced price and gone to war with the USPS. But, price is not just a number. It is a way of signaling value and FedEx understood that. So, they responded by redefining their market. FedEx’s existing “Overnight Delivery” did not specify what time the delivery would arrive. So, FedEx introduced precision not only in terms of the delivery day, but also in terms of the delivery time. They then included two deliveries – one in the morning and another in the afternoon. They then labeled the service as “Priority” and “Standard”. For firms dealing with customers, “Priority” sent a powerful message about how they valued their customer’s business. Firms like Goldman Sachs and JP Morgan Chase were happy to pay for this service distinction. Besides, if mail marked “priority” showed up tomorrow morning with a dozen other envelopes, what do you think a person picked up to read? And, the kicker – FedEx increased the price of its Priority service to $13. It kept the lower end Standard service at $9, effectively “sandwich”-ing USPS between its premium and value offerings. ![]() In one move, FedEx changed the nature of the competition from one on price to one on brand and value. It also backed the decision with technology investment in tracking parcels that provided additional benefit for customers. The lesson? When faced with adversity, don’t just react with what comes intuitively. Take some time off and think about how you could respond by doing what’s counter intuitive. And, if you’re feeling stuck or hopeless, remember the time FedEx raised its prices when being attacked by a huge competitor. Rohan Rajiv is a first-year student in Kellogg’s Full-Time Two-Year Program. Prior to Kellogg he worked at a-connect serving clients on consulting projects across 14 countries in Europe, Asia, Australia and South America. He blogs a learning every day, including his MBA Learnings series, on www.ALearningaDay.com. Filed under: Academics, Business Insight, Student Life Tagged: Brand, finance, MBA Learnings, strategy, Two-Year Program, values |
| FROM Kellogg MBA Blog: Previewing the 2015 Kellogg Marketing Conference |
![]() In today’s digital and connected world, consumer experience has become far more layered and transparent than in the past. Price and quality comparisons are easier than ever, the sales funnel is no longer linear, and change happens fast. The modern-day marketing needs to combine the creative side of the discipline – using powerful narratives to tap into people’s wishes and aspirations – with the technical side of data, digital engineering and analytics. That is why the 2015 Kellogg Marketing Conference will examine “Marketing Outliers: Growing Outside the Comfort Zone.” The conference will explore the recent history of strategic decisions, campaigns, and tactics that went beyond the marketing playbook and how we can learn from the outliers who have taken big risks. I’m looking forward to a number of exciting discussions at the conference. For the first time in the history of the conference, we’re hosting a Creative Lab session led by representatives from the recently founded Google Brand Studio. The Creative Lab is a unique opportunity for Kellogg students to work directly with marketing professionals to solve a high-level marketing challenge and present their solution to the Google Brand Studio and the broader conference audience. The team that develops and communicates the most successful solution will win a trip to Google’s headquarters in Mountain View, Calif., and an opportunity to present to Google’s marketing executives. I’m excited to hear from this year’s keynote speakers: Gerry Graf, founder and Chief Creative Officer, Barton F. Graf 9000 as well as Jorn F. Socquet, Vice-President, Marketing, Anheuser Busch. We also have six panel discussions with amazing panelists from a variety of corporate firms, including:
The conference will bring together students, alumni, faculty and representatives from many of the country’s leading marketing companies to discuss how marketers of the future must be more creative and open to taking risks to differentiate their brands in an omni-channel environment and an increasingly complex world. Visha Chadha is a second-year MMM student at Kellogg. Prior to school, she worked in high tech, specifically in the semiconductor industry, as a design engineer and worked on designing state of the art computer processors and smartphones. She spent her summer at Microsoft doing product marketing in the Cloud Computing group in Seattle. Filed under: Academics, Business Insight, Career, Student Life Tagged: analytics, crowdsourcing, data, digital engineering, Google, Growth, Kellogg Marketing Conference, marketing, MMM, One-Year MBA Program, Two-Year MBA Program |
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