Day 10 - Marketing and more marketing oh..and a bit of Capital Budgeting....

The importance of Branding - too often we do not realise how brands have dictated our purchasing behaviour. Sometimes we question why certain adverts are done in a certan way or why certain personalities are associated with such brands - the class this morning discussed the reasons behind this - we learnt that salience needs to exist for any brand to survive. Salience refers to how often or easy a customer can think of a brand at any point in time. Then customers identify points of difference and points of parity then they make decisions, on which products to choose - either with their heads or their hearts - judgements or feelings. Then they decide whether too remain loyal to the brands or not - in fact - this is the last stage of the Brand resonance pyramid. Strong resonance indicate a strong bond with the brand. Brand Resonance refers to the extent to which customers feel “in sync” with the brand. Just as we feel the vibe between ourselves and others, we also experience a vibe that resonates between ourselves and brands. Oh the joy of studying brands....in fact if you study our purchasing behaviour carefully you will realise that often brands have dictated our behaviour and our tastes - we will only buy coke, or cadbury chocolate etc, so on and so forth. Truly interesting indeed - we really should have more classes on this subject.

The we had a very comprehensive lecture on Capital Budgeting. Dr.Singlair elaborated on the complexities of this subject. He explained that one could use both the Internal Rate of Return method or Net present Value Method when undertaking Capital Budgeting. Both have their merits. He then advised that beyond the numbers, there are other factors that need to be considered as well:

i. Biases in cash flow

ii. Discount Rate

iii. Policies/Government Decisions

iv. Strategic Considerations

v. Hidden Costs

vi. Tarrif fixations

vii. Policy Changes

viii. Business Cycles

I must admit that this lecture floated above me really fast - but the words of our Lecturer re-assured me...'Don't worry, somehow it will come out at the right time...' . Professor, do not be discouraged by the blank looks we were giving you..lols.. - the information is definitely registering - it will come out at the right time.

In the afternoon, we discussed market placements of goods and learnt the art of placing them using the BGC Matrix (Cash cows, stars, question marks and dogs) and GE 9 Cell Models. It was a good session and Dr. Milind clearly articulated the key aspects of both models. Key things to note are:

i. The BCG only takes into account 2 factors - that is growth and market share

ii. The GE 9 cell model allows for more factors, however, because you are making the assessments yourselves, the results are very subjective.

Enjoyable sessions indeed.

MKN