MODULE 1- Introduction to Entrepreneurship

RELEVANCE OF ENTREPRENEURSHIP TO AN ORGANIZATION

1. Development of Managerial Capabilities - this means that one of the benefits an

entrepreneur gets is to develop his managerial skills.
2. Creation of Organizations - which means that because of entrepreneurship many
organizations will exist.
3. Improving Standard of Living - this means that entrepreneurship can lift up the
economic status of an individual.
4. Means of Economic Development - this means that not only the life of the
entrepreneur is improved but also the society where the business is located.

Concept of Entrepreneurship
The word “entrepreneur” was derived from the French verb enterprendre, which
means “to undertake.” This is pinpointing to those who “undertake” the risk of
enterprise. The enterprise is created by an entrepreneur and the process is called
“Entrepreneurship.”
Entrepreneurs are innovators. They are willing to take the risks and generate unique
ideas that can provide profitable solutions to the needs of the market and the society.
Factors Affecting Entrepreneurship
1. Personality Factors which include:
a. Initiative - doing things even before being told.
b. Proactive - which means he can classify opportunities and seize it.

c. Problem Solver - which means he can retain good relations with other people.

d. Perseverance - meaning he will pursue things to get done regardless of challenges.

e. Persuasion - means that he can entice people to buy even if they don’t want to.

f. A Planner - he makes plans before doing things and does not fail to monitor it.

g. Risk-taker - which means that he is willing to gamble but he will calculate it first.
2. Environmental Factors which include political, climate, legal system, economic and
social conditions and market situations.
Common Competencies in Entrepreneurship
1. Decisive - an entrepreneur must be firm in making decisions.
2. Communicator - an entrepreneur must have a convincing power.
3. Leader - an entrepreneur must have the charisma to be obeyed by his employees.
4. Opportunity seeker - an entrepreneur must have the ability to be the first to see
business chances.
5. Proactive – an entrepreneur can control a situation by making things happen or by
preparing for possible future problems.
6. Risk Taker – an entrepreneur has the courage to pursue business ideas.
7. Innovative - the entrepreneur has big business ideas and he does not stop improving
and thinking of new worthwhile ideas for his business.
Core Competencies in Entrepreneurship

1. Economic and Dynamic Activity - Entrepreneurship is an economic activity because

it involves the creation and operation of an enterprise with a view to creating value or
wealth by ensuring optimum utilization of limited resources.
2. Innovative – The entrepreneur constantly looks for new ideas, thus he needs to be
creative.

3. Profit Potential - The entrepreneur can be compensated by his profit coming from the
operation.
4. Risk bearing – The entrepreneur needs to gamble but wise enough to offset the risk.

Types of Entrepreneurs
1. Innovative Entrepreneurs - They are those who always make new things by thinking
of new ideas. They have the ability to think newer, better and more economical ideas.
2. Imitating Entrepreneurs - They are those who don’t create new things but only

follow the ideas of other entrepreneurs.

3. Fabian Entrepreneurs - They are skeptical about changes to be made in the
organization. They don’t initiate but follow only after they are satisfied.
4. Drone Entrepreneurs - They are those who live on the labor of others. They are die-
hard conservatives even ready to suffer the loss of business.
5. Social Entrepreneurs - They are those who initiate changes and drive social
innovation and transformation in the various fields such as education, health, human
rights, environment and enterprise development.

Career Opportunities of Entrepreneurship

1. Business Consultant - with the expertise of in the field of entrepreneurship, he can
be a very good source of advices to other entrepreneurs and would be business men.
2. Teacher - a graduate of an entrepreneurship can use his knowledge in teaching.
3. Researcher - the entrepreneur can be employed as a researcher by an enterprise.
4. Sales - the entrepreneurship graduate can apply as a salesman.
5. Business Reporter - the entrepreneur being expert in the field, can be employed as a
business reporter.
Job Opportunity is simply an opportunity for employment. When we say
career, it is a long-term professional journey you may determine based on your
passions. It is the path you embark upon to fulfil your professional goals and
ambitions. A career in entrepreneurship can be made in virtually any field,
depending on your interests.

The following are some of the Job Opportunities for Entrepreneurship

1. Business Consultant. They are those who can go to client site, identify
problems and fix them. They asses and create solutions to help the company
more efficiently meet its goal. Also known as management analysts, work in
areas that include marketing, human resources, management, and accounting.
The duties for business consultants generally begin with understanding what
clients wish to improve or fix.

Example:
When Mr. Tan helps to improve business processes to do better and will partner
with executive management to review their current business operations
processes and make recommendations to improve efficiency, enhance customer
service, and reduce company costs, he is a business consultant.

2. Sales Manager. Someone who knows how to represent a company, manage

accounts and follow up leads. Their responsibilities include designing and
implementing a strategic sales plan that expands company's customer base and
ensure its strong presence.

Example:
Mr. Go presented the new artistic designs of Leo Arts and Designs in the market
and implemented his strategic plans that will make the designs to be the top of
the mind of the customers. Here, Mr. Go is a sales manager.

3. Research and Development Director. Someone who understands business

concepts, systems, procedures and practices. Looking for used facts and
information, interpreting data and making conclusions, and recommending
courses of action. They are responsible for controlling, coordinating and carrying
out research in various company departments, guaranteeing the continuous
innovation of products and work processes.

Example:
Johnson & Johnson today announced the selection of a lead COVID-19 vaccine
candidate from constructs it has been working on since January 2020; the
significant expansion of the existing partnership between the Janssen
Pharmaceutical Companies of Johnson & Johnson and the Biomedical Advanced
Research and Development Authority (BARDA). Here, they need researchers to
do the necessary research and look into the best and accurate vaccine to offer in
the market.

4. Fundraiser. Someone who raises money for a specific purpose and meant
not to make profit but instead for maintaining the organization or toward the
purpose for which it was created. They organize events, building networking
relationships and raising money for a cause. They also may design promotional
materials and increase awareness of an organization's work, goals, and financial
needs.

Example:
Maria is passionate in helping others and oversee campaigns and events to raise
money and other kinds of donations for an organization. She ensures that
campaigns are effective by researching potential donors. Here, Maria is a
fundraiser.

5. Teacher. These educators train their students to solve business problems,

plan for future growth, and strategize how to run a business efficiently and
effectively. Many business educators have experience working in business as
well as a background in education, transferring the skills and knowledge students
need to become qualified business professionals.
Example:
Mr. Cruz inspires young people to have a vision for society. He shares his
experiences and insights about business and success. He also teaches them how
to make business plan and how to implement it. Here, Mr. Cruz is a teacher.
6. Talent Recruiter. Someone whose job is in sourcing, attracting, recruiting,
interviewing, and on-boarding employees to an organization. Someone who is
people savvy and has an in-depth business sense as well.
Example:
Mr. Gonzales ensures that the company attracts, hires and retains the best
employees, while growing a strong talent pipeline. Here, Mr. Gozales is one of
the talent recruiter.

7. Business Reporter. Someone who can write articles is in a prime position to

take the lead on covering a local business beat. They write breaking news and
business stories in unique and interesting ways to increase readership.
Example:
Ms. Silva were tasked to give a report on the business story of a full time
housewife who successfully runs her new recipe of banana. He wanted to get
accurate information. So he planned to conduct an actual interview to the owner.
He prepared interview questionnaires to be used in gathering the information
about the success story. Here, Ms. Silva is a business reporter.

8. New Venture Creator. Someone who launch a company, start a new

venture in a family enterprise or commercializing a technology. They are
entrepreneurial people whose primary role is in creating new business via
creating new start-ups or scaling growing companies, having significant and
direct stake in the actual business success.
Example:
Young entrepreneur Aya Fernandez turned her school science project into an
eco-friendly social enterprise. Project Lily PH manufactures Eco-Uling which are
charcoals made of water hyacinth, agri-forest wastes and coconut husks. The
Miss Teen Philippines titlist has shown how Filipinas are more than just beauty
queens as she leads a manpower composed of persons with disabilities and
women in her community. Aya Fernandez is a new venture creator.
MODULE 2 Recognize a Potential Market

Entrepreneurial Ideas
The creation of an entrepreneurial idea leads to the identification of entrepreneurial
opportunities, which in turn results in the opening of an entrepreneurial venture.

The entrepreneurial process of creating a new venture is presented in the diagram

below. (Nick L. Aduana, Entrepreneurship in Philippine Setting for Senior High School,
2017, C&E publishing page 46, Aduana, 2017).

Figure 1. The Entrepreneurial Process of Creating New Venture

Essentials in Entrepreneur’s Opportunity – Seeking

These are the basic foundation that the entrepreneur must have in seeking
opportunities:
Entrepreneurial mind frame. This allows the entrepreneur to see things in a very
positive and optimistic way in the midst of difficult situation. Being a risk - taker, an
entrepreneur can find solutions when problems arise.
Entrepreneurial heart flame. Entrepreneurs are driven by passion; they are attracted to
discover satisfaction in the act and process of discovery. Passion is the great desire of
an entrepreneur to achieve his/her goals.
Entrepreneurial gut game. This refers to the ability of the entrepreneur of being
intuitive. This also known as intuition. The gut game also means confidence in one’s self
and the firm belief that everything you aspire can be reached.

Sources of Opportunities
There are many ways to discover opportunities. Looking at the big picture, some have
noticed the emerging trends and patterns for business opportunities. While others are
trying to find out their target market. The following are some sources of opportunities:

1. Changes in the environment

Entrepreneurial ideas arise when changes happen in the external environment. A person
with an entrepreneurial drive views these changes positively. External environment
refers to the physical environment, societal environment, and industry environment
where the business operates.
1.1 The Physical environment includes

a. Climate – the weather conditions.

b. Natural resources – such as minerals, forests, water, and fertile land that occur in
nature and can be used for economic gain.
c. Wildlife – includes all mammals, birds, reptiles, fish, etc., that live in the wild.

1.2 The Societal environment includes the various forces like

a. Political forces – includes all the laws, rules, and regulations that govern business
practices as well as the permits, approvals, and licenses necessary to operate the
business.
b. Economic forces – such as income level and employment rate.
c. Sociocultural forces – customs, lifestyles and values that characterize a society.
d. Technological environment – new inventions and technology innovations.

1.3 The Industry environment of the business includes:

a. Competitors
b. Customers
c. Creditors
d. Employees
e. Government
f. Suppliers

For example, one factor in the physical environment that can easily change is the
climate. The temperature is very high during summer but very low during the rainy
season. An individual with entrepreneurial drive can be extremely imaginative and
inventive in identifying opportunities. He/she can venture on a business that responds to
the needs of the people during summer and rainy season.

2. Technological discovery and advancement

A person with entrepreneurial interest sees possibility of business opportunities in any

new discovery or because of the use of latest technology.
For example, an individual with knowledge in repair and installation of a machine engine
discovers additional engine parts that considerably reduce fuel consumption.

3. Government’s thrust, programs, and policies

The priorities, projects, programs, and policies of the government are also good sources
of ideas.
For example, the use of firecrackers to celebrate New Year’s Eve is strictly prohibited.
People without entrepreneurial interest will view the ordinance as a plain restriction.
However, for an entrepreneur, it is a business opportunity to come up with a new product
that will serve as a substitute for firecrackers.

4. People’s interest

The interest, hobbies, and preferences of people are rich sources of entrepreneurial
ideas, like the increasing number of Internet Cafés at present could lead to the strong
attachment of young people to computers.
5. Past experiences

The expertise and skills developed by a person who has worked in a particular field may
lead to the opening of a related business enterprise.
For example, an accountant who has learned the appropriate accounting and
management skills and techniques in a prominent accounting firm can start his/her
business venture by opening his/her own accounting firm.

Forces of Competition Model

It is also known as the “five forces of competition”. An industry environment is a
competitive environment. Regardless of what product or services you have, competition
is always present.

Competition – it is the act or process of trying to get or win something.

For example, the prices are lower when there is a competition among the stores.
These are the five forces competing within the industry:
 Buyers
 Potential new entrants
 Rivalry among existing firms
 Substitute products
 Supplier

1. Buyers
The buyers are the ones that pay cash in exchange for your goods and services. One
example is the influence of the price or in the bargaining strategy. The buyer has a
strong and magnified bargaining power. The threat of its bargaining power will be less if
the following factors are noticed:
a. There are several suppliers available in the market.
b. The buyer has the potential for backward integration.
c. The cost of switching the supplier cost is minimal.
d. The product represents a high percentage of the buyer’s cost.
e. The buyer purchases large portions of the seller’s product or services

2. Potential New Entrants

A new entrant is defined as companies or businesses that have the ability to penetrate
or enter into a particular industry. For example, in the level of capital requirements, if the
business requires huge capital, new entrants should decline to join the business. This
gives a threat to the business. This can be noticed if there is the presence of the
following factors:
a. Substantial capital requirement
b. Strict government policy
c. Difficulty in accessing distribution channels
d. Economies of scale
e. High cost of product differentiation
f. High switching cost
3. Rivalry among Existing Firms

Rivalry is a state or situation wherein business organizations are competing with each
other in a particular market. For example, it depends on the marketing strategy of your
competitor, like giving freebies and special offers. The intensity of rivalry among existing
firms is characterized to the following factors:
a. Diversity of rivals
b. Number of competing firms
c. Characteristics of the products or services
d. Increased capacity
e. Amount of fixed costs
f. Rate of industry growth

4. Substitute Products

Substitute is one that serves the same purpose as another product in the market. For
example, the consumers decide to use margarine as a substitute for butter. In case the
price of butter increases, preferably the consumer will gradually switch to margarine.
A substitute product can give a big threat in the industry environment if the following
factors are noticed:
a. Switching cost is low
b. Preferences and tastes of the customers easily change
c. Product differentiation is highly noticeable
d. The quality of substitute products dramatically improves
e. The price of substitute product is substantially lower
5. Suppliers

The Suppliers are the one that provide something that is needed in business operations
such as office supplies and equipment. In an example where supplies and services
being offered is unstable the intensity of the threat is strong in this kind of the
competitive force in the industry. This can be noticed if there is the presence of the
following factors:
a. The supplier has the ability for forward integration
b. Suppliers in the industry are few, but the sales volume is high
c. Substitute products are not readily available in the market
d. The switching cost is very high
e. The product or service is unique

Definition of Terms

Buyers – are the ones who pay cash in exchange for your goods and services.
Competition – it is the act or process of trying to get or win something.
Entrepreneurial process - can be defined as the steps taken in order to begin a new
enterprise. It is a step-by-step method one has to follow to set up a business.
Entrepreneurial ideas - an innovative concept that can be used for financial gain that is
usually centered on a product or service that can be offered for money.
Essentials of entrepreneur’s opportunity – seeking – these are the basic foundation
that the entrepreneur must have in seeking opportunities, such as entrepreneurial mind
frame, heart flame and gut game.
External environment - refers to the physical environment, societal environment, and
industry where the business operates.

Government - refers to the local government (municipality, city, or provincial) or the

national government and its branches.
New entrants – the one who enters something.
Opportunity – seeking – the process of considering, evaluating, and pursuing market-
based activities that are accepted to be beneficial for the business.
Rivalry – is a state or situation in which people or groups are competing with each other.
Sources of opportunity - can be attained by assessing and looking at changes in the
environment; technological discovery and advancement; government’s thrust, programs,
and policies; people’s interest, and past experiences.
Substitute – anything that takes the place or function of another.
Suppliers – are the ones who provide something that is needed or wanted.

Market Needs. Businesses should start by knowing the consumer's interests,

desires, and needs. It is easier to sell what consumers want and need than try to
sell something they do not see the benefit in buying. In a fast moving world, it
should be a competitive edge having the chance of monitoring the market,
detecting what can be a source of a profitable new business. Market needs
inform organizations about what products develop, for what customers, at what
cost, through which distribution channels, reducing the uncertainty that a new
product/service development always brings with it.

Creating your marketing plan should be a top priority. The top priority for a
marketing plan is identifying the largest group of potential buyers for your
products or services. Within that group exists smaller segments, and it has
unique needs that you might decide to run specific marketing campaigns for.
There are 5 things that market research can do for you in the process of product
development & business growth:

1. It is crucial for a better understanding of your customers

Market research will help you map out the full profile of your ideal customer.
Knowledge of your customers will help you determine the market size and what
triggers them to buy. You’ll gain valuable insights like their age, location, gender
& income, which will help you in creating effectively tailored marketing and
pricing campaigns.

2. Knowledge about your competitors, and how they approach the

market
Market research will help assess the market to identify both key players and
those on the rise. Furthermore, it will help you find the weaknesses in your
competitor’s approach. These are gaps that you can utilize to gain more
customers. You can also learn what performed the best for the competition. In
turn, you will be able to think more creatively while modelling your new strategy.

3. Testing your product before launch

Testing is a very important part of learning what works before jumping into the
business world. Every business decision should be tested before fully exposing to
your target audience. By market testing your idea or product, you will save
yourself from additional expenses and most importantly, from delivering a bad
product to the marketplace.
You can never be 100% sure that your product will instantly connect with your
potential customer. With market research, you’ll find out what approach you
should take when marketing the product. You’ll also find the key message that
resonates with clients.

4. You won’t go out of business

―It is not the strongest or the most intelligent who will survive but those who
can best manage change.‖ — Charles Darwin
So, in order to remain in business and stay relevant, you should not only
anticipate change, but you need to be able to predict change too. That’s how
good your market research needs to be!

5. Business growth
Market research helps you comprehend the demands of your customers, detect
more business opportunities, plan the perfect marketing campaign, minimize
losses, and keep track of the competition. It allows organizations to classify their
objectives while following the current trends and take advantage by reaching out
to their target audience.
Identifying problems before they happen is crucial if you want to grow. Effective
market research will not only help you predict some of the pitfalls that can occur
but also it will save you a lot of money too. Your solution may look like a proper
market fit, but if it’s not the case, you’re in big trouble.

The process of market research itself is designed to reduce the risk and
to make the marketing strategy cost-effective for your business.
Choosing a Product or Service to Sell.

To succeed as an entrepreneur, you must develop the ability to select and offer
the right products or services to your customers in a competitive market. More
than any other factor, your ability to make this choice will determine your
success or failure.
There are thousands of products and services available to consumers today. And
there are unlimited opportunities for you to enter the marketplace and compete
effectively with a new product or service that's better in some way than what's
already being offered by your competitors. Remember, your skill at choosing that
product or service is critical to your success.
The most important thing you can do before deciding what to sell is to think.
And the more you think about a product or service before you bring it to market,
the better your decisions will be.
So how do you start? To make a product successful, you must be personally and
emotionally committed to its success. Once you've got a product or service in
mind, you need to begin with a self-analysis.

How to Make Sure There's a Market for Your Business Idea

1. Accept the market as a harsh, but fair judge.

If you're in business, you simply need to embrace the reality that the market will
ultimately dictate your success. That means you have to make sure the numbers
support your idea.

2. Pick proven categories, then find your niche.

Broad proven categories typically offer greater opportunities than hot new
markets.

3. Focus on wallet share, not market share.

Think about how you can retain your customers for repeat business so you can
get an exponential return on your initial advertising or marketing investment.

4. Put your ideas to the test.

Better to pay the price in terms of time and effort now in order to learn what you
don't know about your market and buyer. The response you get will tell you what
buyers in your market want, need and desire. You can then use that information
to enhance your offering or to discover a more profitable market and business
than you initially conceived.
Module 3 - Recognize and Understand the Market
Entrepreneurial mind frame, Entrepreneurial heart flame, and Entrepreneurial gut
game. In opening a new venture or business, you need to determine the Unique Selling
Proposition (USP) and Value Proposition (VP) of your product as well as your target
market What is Unique Selling Proposition (USP) and Value Proposition (VP)? This part
allows the entrepreneur to prepare himself on how to advertise and sell his product even
if it is similar to others. In this lesson, you will find out the answers and understand more
about the market.

Value Proposition (VP) - is a business or marketing statement that summarizes why a

consumer should buy a company's product or use its service. This statement is often
used to convince a customer to purchase a particular product or service to add a form of
value to their lives. In creating Value Proposition, entrepreneurs will consider the basic
elements:
 Target Customer
 Needs/opportunity
 Name of the product
 Name of the enterprise/company

There are many competitors in the market who establish superiority over other
entrepreneurs. Entrepreneurs should think of other alternatives to make their products
better. An important aspect in Value Proposition is that it must be truthful and that it
should establish credibility to the consumers.

Example: Potential value proposition is most common in small businesses of your

locality.

Aling Charing Sari-Sari Store opens only from 6:00 am to 6:00 pm, but Aling Charing
noticed that there are customers who go to a nearby town to look for a convenience
store at around 10:00 pm to 6:00 am. She believes that this is a great opportunity for her
store to operate 24/7. In this example, the proposed value proposition is: “Charing sari-
sari Store, open 24/7”.

The business describes a sari-sari store – a basic retail store. The assurance from this
value proposition is because of the phrase “open 24/7”, Aling Charing’s sari-sari store
opens 24/7, which makes it different from other competitors.

Unique Selling Proposition (USP) – refers to how you sell your product or services to
your customer. You will address the wants and desires of your customers.
As an entrepreneur, you should think of marketing concepts that persuade your target
customers. You may ask the following questions in doing this: What do the customers
want? What brand does well? What does your competitor sell well?
Some tips for the entrepreneur on how to create an effective unique selling proposition
to the target customers are:
 Identify and rank the uniqueness of the product or services character
 Be very Specific
 Keep it Short and Simple (KISS)
As an entrepreneur, present the best feature of your product or service that is different
from other competitors. Identifying the unique selling proposition requires marketing
research that you will learn from the other modules. In promoting your products or
services, make sure that it is very specific and put details that emphasize the
differentiator against the competitors. Keep it short and simple and think of a tagline that
is easy to remember. Right now, the proposed unique selling proposition is: “Charing
sari-sari store, open 24/7”

Readers get confused between value proposition and unique selling proposition. The
two propositions are used to differentiate the products from competitors. For example,
Jollibee is known to have a Filipino taste burger. This brand has a unique selling point
because of its tagline “Langhap Sarap”

Unique Selling Proposition and Value Proposition are two of the most famous tools
used to explain why prospect customers buy each product and service. Base on each
definition, we learn that USP and VP are frameworks of each business industry. The two
propositions are valuable for the entrepreneurs. Make sure that you're focusing on a
solution that is a need, and make sure that you are targeting a customer segment that's
large enough and cares enough about your solution so that you can build a viable
business. We'll talk more about determining the size of your target market in our next
lesson.

After you understand the value proposition and the unique selling proposition, now it’s
time to understand the target market, customers requirement
and market size. As you might expect, the market is right at the center of our word cloud
for this lesson. Understanding your market is critical in building your business model.
There are three factors that will determine your customers.

A. Target Market
Market Targeting is a sage in market identification process that aims to determine the
buyers with common needs and characteristics. Prospect customers are a market
segment that an entrepreneurial venture intends to serve.
In targeting a specific market, it will exclude people if it will not fit your criteria. Rather,
target marketing allows you to focus your marketing money and brand message on a
specific market that is more likely to buy from you than other markets. Choose a product
that is more affordable, efficient, and effective to reach potential clients and generate
business.

Commonly used methods for segmenting the markets are follows.:

1. Geographic segmentation – the total market is divided according to geographical
location.
 Variables to consider
a. Climate
b. Dominant ethnic group
c. Culture
d. Density (either rural or urban)
2. Demographic Segmentation – divided based on consumers
 Variables to consider
a. Gender
b. Age
c. Income
d. Occupation
e. Education
f. Religion
g. Ethnic group
h. Family size

3. Psychological Segmentation – divided in terms of how customers think and believe

 Variables to consider
a. Needs and wants
b. Attitudes
c. Social class
d. Personality traits
e. Knowledge and awareness
f. Brand concept
g. Lifestyle

4. Behavioral Segmentation – divided according to customers’ behavior pattern as they

interact with a company.
 Variables to consider
a. Perceptions
b. Knowledge
c. Reaction
d. Benefits
e. Loyalty
f. Responses

B. Customer Requirements
Customer requirements are the specific characteristics that the customers need from a
product or a service.
There can be two types of customer requirements:
1. Service Requirement
2. Output Requirement

Service Requirement:
An intangible thing or product that cannot be touched but the customer can feel the
fulfillment. There are elements in service requirement like on-time delivery, service with
a smile, easy-payment etc. It includes all aspects of how a customer expects to be
treated while purchasing a product and how easy the buying process goes.

Output Requirements:
Tangible thing or things that can be seen. Characteristic specifications that a consumer
expects to be fulfilled in the product. Costumers will avail services as a product, then
various service requirements can take the form of output requirements. For example, if
the consumer hires a multi cab, then on-time arrival becomes an output requirement.
Customer buys gadgets (phone speaker) the specification like the loudness and clarity
are the output requirements.

C. Market Size
The entrepreneur’s most critical task is to calculate the market size, and the potential
value that market has for their start-up business. Market research will determine the
entrepreneurs’ possible customers in one locality.

What is Market Size?

Market size is like a size of the arena where the entrepreneurs will play their business. It
is the approximate number of sellers and buyers in a particular market. Companies are
interested in knowing the market size before launching a new product or service in the
area. In determining the market size, the entrepreneur will conduct a strategic marketing
research from reliable sources using the following method. The first step is to estimate
the potential market – approximate number of customers that will buy the product or
avail your services. The second step is to estimate the customers who probably dislike
to buy your product or avail the services. The third step is for the entrepreneur to
estimate the market share, that means plotting and calculating of the competitor’s
market share to determine the portion of the new venture. Market size becomes the
most important factor if you ever need to raise funding for your business.
MODULE 4 – MARKET RESEARCH
Market Research or Marketing Research Process can be defined as the process of
gathering, analyzing and interpreting the information about the products or the services
to be offered for sale to the potential consumers in the market (De Guzman, 2018, p. 25)

DATA COLLECTION is the most valuable tool in any type of research study. Inaccurate
data collection may cause mistakes and ultimately lead to invalid results. (Edralin, 2016,
p. 80)

TIPS in COLLECTING DATA

 Organize collected data as soon as it is available
 Know what message you want to get across and then collect data that is relevant to
the message
 Collect more data
 Create more data
 Take note of interesting or significant data

SURVEYS are the most common way to gather primary research with the use of
questionnaires or interview schedule. These can be done via direct mail, over the phone,
internet (e.g. Google) or email, face-to-face or on the Web (e.g. Skype or Viber).
When designing or constructing your own research questionnaire, remember the
following guidelines. (Edralin, 2016)

 Keep it as simple as possible

 Make sure it is clearly appealing and easy to read
 Cluster or block related questions
 Move from complex questions to more specific questions
 Make sure questions are concise and easily understood
 Avoid questions that are difficult to answer

Make sure response scales used are consistent with categories that are mutually
exclusive

INTERVIEW is one of the most reliable and credible ways of getting relevant information
from target customers. It is typically done in person between the
researcher/entrepreneur and a respondent where the researcher asks pertinent
questions that will give significant pieces of information about the problem that he will
solve. The interview is also helpful even when the business has already started because
the customers’ feedback provides the entrepreneur a glimpse of what the customers
think about the business.
Interviews normally last from 15 to 40 minutes, but they can last longer, depending on
the participants’ interest in the topic.
In a structured interview, the researcher asks a standard set of questions and nothing
more. (Leedy & Ormrod, 2001, pp.38-39)
Personal interviews are the traditional method of conducting an interview. It allows the
researcher to establish relationship with potential participants and therefore gain their
cooperation. It generates highest response rates in survey research. They also allow the
researcher to clarify indefinite answers and when necessary, seek follow-up information.
(Leedy & Ormrod, 2001, pp.39)

 Telephone interviews are less expensive and less time-consuming, but the
disadvantages are that the response rate is not as high as the face-to-face interview, but
considerably higher than the mailed questionnaire.

FOCUS GROUP DISCUSSION (FGD) - is an excellent method for generating and screening ideas
and concepts. It can be moderated group interviews and brainstorming sessions that provide
information on user’s needs and behaviors.

The following are considerations in the use of focus group discussions in market
research:
 The length of the session is between 90 and 120 minutes.
 Conduct focus groups discussion with 8 to 10 participants per group.
 Assign an expert moderator / facilitator who can manage group dynamics.
 Use a semi-structured or open-format discussion
 Strive for consistency in the group’s composition (for example, it may not be advisable
to have business customers and retail customers in the same focus
MODULE 5- 7 P’s of Marketing and Branding

The 7 P’s of Marketing Mix

There are several important frameworks which you can utilize for the purpose of
marketing your product and services. A very crucial structure among these is the “7 P’s
of Marketing. The framework of “7 Ps of marketing” includes product, place, price,
promotion people, packaging and positioning. Realizing these P’s in the most ideal
manner can turn out to be very profitable, however, you should totally see each
description of the 7 P’s first.
1. PRODUCT

The first P in the Marketing Mix is the Product. Marketing strategy typically starts with the
product. Marketers can’t plan a distribution system or set a price if they don’t know
exactly what the product will be offered to the market.
Product refers to any goods or services that is produced to meet the consumers’ wants,
tastes and preferences. Examples of goods include tires, MP3 players, clothing and etc.
Goods can be categorized into business goods or consumer goods. A buyer of
consumer goods may not have thorough knowledge of the goods he buys and uses.
Examples of services include hair salons and accounting firms. Services can be divided
into consumer services, such as hair styling or professional services, such as
engineering and accounting.
2. PLACE
Place is the second P in the Marketing Mix. Place represents the location where the
buyer and seller exchange goods or services. It is also called as the distribution channel.
It can include any physical store as well as virtual stores or online shops on the Internet.
It is one thing having a great product, sold at an attractive price. But what if:
• Customers are not near a retailer that is selling the product?
• A competing product is stocked by a much wider range of outlets?
• A competitor is winning because it has a team of trained distributors or sales agents
who are out there meeting customers and closing the sale?
Place matters for a business of any size. It is a crucial part of the marketing mix. The
main function of a distribution channel is to provide a link between production and
consumption.
Channel 1 contains two stages between producer and consumer - a wholesaler and a
retailer. A wholesaler typically buys and stores large quantities of several producers'
goods and then breaks into bulk deliveries to supply retailers with smaller quantities. For
small retailers with limited order quantities, the use of wholesalers makes economic
sense.
Channel 2 contains one intermediary. In consumer markets, this is typically a retailer. A
retailer is a company that buys products from a manufacturer or wholesaler and sells
them to end users or customers. In a sense, a retailer is an intermediary or middleman
that customers use to get products from the manufacturers.
Channel 3 is called a "direct-marketing" channel, since it has no intermediary levels. In
this case the manufacturer sells directly to customers.
3. PRICE

The third P in the Marketing Mix is price. The price is a serious component of the
marketing mix. What do you think is the meaning of Price?
In the narrowest sense, price is the value of money in exchange for a product or service.
Generally speaking, the price is the amount or value that a customer gives up to enjoy
the benefits of having or using a product or service. Thus, customers exchange a certain
value for having or using the product – a value we call price. In commerce, price is
determined by what (1) a buyer is willing to pay, (2) a seller is willing to accept, and (3)
the competition is allowing to be charged. With product, promotion, and place of
marketing mix, it is one of the business variables over which organizations can exercise
some degree of control. One example of a pricing strategy is the penetration pricing. It is
when the price charged for products and services is set artificially low in order to gain
market share. Once this is attained, the price can be higher than before. For example, if
you are going to open a Beauty Salon, you need to set your prices lower than those of
your competitors so that you can penetrate the market. If you already have a good
number of market share then you can slowly increase your price.
There are several factors that affect a small business’ revenue potential. One of the
most important is the pricing strategy utilized by you as the owner of the business. A
right pricing strategy helps you define the particular price at which you can maximize
profits on sales of your product or service. You need to consider a wide range of factors
when setting prices of your offerings. The different pricing strategies with its definition
can be found in the table below.
4. PROMOTION
Promotion is the fourth P in the Marketing Mix. Promotion refers to the complete set of
activities, which communicate the product, brand or service to the user. The idea is to
create an awareness, attract and induce the consumers to buy the product, in
preference over others. The following are the most common medium in promoting a
product and this is called promotional mix.
PROMOTIONAL MIX
1. ADVERTISING
• Radio
Advertising by means of radio gives the advantage of selecting the territory and
audience to which the message is to be directed. It is also cheaper than TV advertising.
• Television
This is the latest and the fast-developing medium of advertising and is getting increased
popularity these days. It is more effective as compared to radio as it has the advantages
of sound and sight. On account of pictorial presentation, it is more effective and
impressive and leaves a lasting impression on the mind of the viewer.
• Print
The print media carry their messages entirely through the visual mode. These media
consist of newspapers, magazines and direct mail.
• Electronic
You can also advertise electronically through your company website and provide
important and pertinent information to clients and customers. You can protect some
parts of your website through passwords and give access to member customers. You
can also send advertisements via direct e-mail as part of your promotional strategy.
• Word of Mouth
Word-of-mouth advertising is important for every business, as each happy customer can
steer dozens of new ones your way. And it's one of the most credible forms of
advertising because a person puts their reputation on the line every time they make a
recommendation and that person has nothing to gain but the appreciation of those who
are listening.
• Generic
The promotion of a particular commodity is without reference to a specific producer,
brand name or manufacturer. Producers join together to expand total demand for the
commodity, thereby helping their own sales. These activities are often self-funded
through assessments on marketing called check-off programs.
2. PUBLIC RELATIONS OR PR
In public relations, the article that features your company is not paid for. The reporter,
whether broadcast or print, writes about or films your company as a result of information
he or she received and researched.
Many people use the term PR and advertising interchangeably, PR involves sharing
information with the public using platforms that do not require a payment, such as social
media or through press releases shared with magazines and newspapers. PR
professionals package information and disseminate it in the hopes that it will be
organically shared. The goal of public relations is to shape public perception of a
business, presenting a positive image through various strategies to its various
constituents.
3. PERSONAL SELLING
Personal selling occurs when an individual salesperson sells a product, service or
solution to a client. Salespeople match the benefits of their offering to the specific needs
of a client. Today, personal selling involves the development of longstanding client
relationships.
Personal selling involves a selling process that is summarized in the following Five
Stage Personal Selling Process. The five stages are:
• Prospecting
• Making first contact
• The sales call
• Objection handling
• Closing the sale
4. SALES PROMOTIONS
Sales promotion is any initiative undertaken by an organization to promote an increase
in sales, usage or trial of a product or service (i.e., initiatives that are not covered by the
other elements of the marketing communications or promotions mix).
Sales Promotion Technique
• Free Gifts
There are many ways to utilize this particular sales promotion technique. A newly
opened store, for example, may offer the first 10 customers free items worth 100 pesos.
• Free Samples
Providing free samples is a technique used to introduce new products to the
marketplace. Samples give the consumer a chance to see how well they like a product
or try something they otherwise would not normally buy.
• Free Trial
A free trial is a way for a consumer to try a new product while eliminating risk. It may be
used when a product is unique to the marketplace.
Customer Contests
Contests offer the customer a chance to win prizes like cash or store merchandise.
• Special Pricing
Special pricing is used to offer consumers a lower price for a period of time or to
purchase in multiple quantities. For example, a retailer may offer a product that normally
costs 35 pesos at a price of 3-for-100-pesos during the promotional period.
5. DIRECT MARKETING
Direct marketing is a promotional method that involves presenting information about your
company, product, or service to your target customer without the use of an advertising
middleman. It is a targeted form of marketing that presents information of potential
interest to a consumer that has been determined to be a likely buyer.
Forms of Direct Marketing
Brochure Catalogs Fliers Newsletters Post cards
Coupons Email Phone calls Text messages
5. PEOPLE

The fifth P in the Marketing mix is People. Your team, the staff that makes it happen for
you, your audience, and your advertisers are the people in marketing. This consist of
each person who is involved in the product or service whether directly or indirectly.
People are the ultimate marketing strategy. They sell and push the product. People are
one of the most important elements of the marketing mix today. This is because of the
remarkable rise of the services industry. Products are being sold through retail channels
today. If the retail channels are not handled with the right people, the product will not be
sold. Services must be first class nowadays. The people rendering the service must be
competent and skilled enough so that that the clients will patronize your service. The
marketing efforts of people are to create customer awareness, to arouse customer
interest, to educate customers, to close the sale and to deliver the product.
Therefore, the right people are essential in marketing mix in the current marketing
scenario.
6. PACKAGING

Packaging is the sixth P in the Marketing Mix. Packaging is a silent hero in the marketing
world. Packaging refers to the outside appearance of a product and how it is presented
to the customers. The best packaging should be attractive enough and cost efficient for
the customers. Packaging is highly functional. It is for protection, containment,
information, utility of use and promotion.

Five Basic Functions of Packaging

1) Protection:
One of the major functions of packaging is to provide for the effects of time and
environment for the natural and manufactured products. The protection function can be
divided into some classes.
A. Natural deterioration:
It is caused by the interaction of products with water, gases and fumes, microbiologic
organisms like bacteria, yeasts and molds, heat, cold, dryness, contaminants and
insects and rodents.
B. Physical protection:
The packaging is also used for physical protection, which include improving shock
protection, internal product protection and reducing shock damage caused from
vibration, snagging, friction and impact.
C. Safety:
A special kind of protective packaging is required for products that are deemed harmful
to those who transport them or use them. These products include extremely inflammable
gas and liquid, radioactive elements, toxic materials etc. The packaging should also be
done so that children could not easily use or dispose them.
D. Waste reduction:
Packaging also serves to reduce the amount of waste especially in case of food
distribution.

2) Containment:
This involves merging of unit loads for shipping. It starts with spots of adhesives on the
individual shippers that stick them together, straps of steel and plastic, entire coverings
of shrinkable or stretchable plastic films and paper or corrugated wraps that surround an
entire pallet of product.
There are some special bulk boxes or pallet bins made from unusually strong corrugated
board or fabricated form plastics or metal, the method of which depends on the type and
weight of product and its protective needs. The cargo containers made of aluminum
used to hold many pallet loads of goods can be transferred to or from ships, trains and
flatbed trucks by giant cranes.
3) Information:
The packaging conveys necessary information to the consumers. The common
information that packaging provides include general features of the product, ingredients,
net weight of the contents, name and address of the manufacturers, maximum retail
price (MRP).
Packaging of medicine and some food products is required to provide information on
methods of preparations, recipes and serving ideas, nutritional benefits, and date of
manufacturing, date of expiry, warning messages and cautionary information.
Sometimes, the color of the packaging itself provides some information.
4) Utility of use:
The convenience packaging has been devised for foods, household chemicals, drugs,
adhesives, paints, cosmetics, paper goods and a host of other products. This type of
packaging includes dispensing devices, prepackaged hot metals, and disposable
medical packaging.
5) Promotion:
Companies use attractive colors, logos, symbols and captions to promote the product
that can influence customer purchase decision.
Packaging Decisions:
i. Packaging concept:
This defines what the package should be or do for the particular product in terms of size,
shape, materials, color, text, and brand mark and tamperproof ability
ii. Engineering tests:
This will ensure that the package stands up under normal conditions
iii. Visual tests:
This is to ensure that the script is legible and colors are harmonious
iv. Dealer tests:
This is to ensure that the dealers find the packages attractive and easy to handle
v. Consumer tests:
This is to ensure favorable consumer response

7. POSITIONING
Finally, the seventh P in the Marketing Mix is Positioning. When a company presents a
product or service in a way that is different from the competitors, they are said to be
“positioning” it. Positioning refers to a process used by marketers to create an image in
the minds of a target market.
Solid positioning will allow a single product to attract different customers for not the
same reasons. For example, two people are interested in buying a phone; one wants a
phone that is cheaper in price and fashionable while the other buyer is looking for a
phone that is durable and has longer battery life and yet they buy the same exact phone.
There are three basic concepts for positioning. These are Functional Positions, Symbolic
Positions and Experiential Positions. Functional Positions deal with solving a problem,
providing benefits and getting a favorable perception from investors, stockholders and
consumers. Symbolic Positions deal with self-image enhancement, ego identification,
belongingness, social meaningfulness and affective fulfilment and Experiential Positions
deal with providing sensory or cognitive stimulation.
Steps of the Positioning Process
Step 1: Confirm Your Understanding of Market Dynamics
At the start of the positioning process, you need a firm understanding of your target
market and answers to the following questions:
In which product, service, or market category (also called the “frame of reference”) do
you plan to use this positioning?
Which target segment is your focus for the positioning you are developing?
What factors do these buyers evaluate when they make a purchasing decision?
How do these buyers view your competitors in the category?
If you don’t have answers to these questions, you should consider conducting formal or
informal marketing research to reach a better understanding of your target market and
the market dynamics around it.
Step 2: Identify Your Competitive Advantages
A competitive advantage is some trait, quality, or capability that allows you to outperform
the competition. It gives your product, service, or brand an advantage over others in
purchasing decisions. Competitive advantage may come from and or all of the following:
Price: Something in your production process or supply chain may make it possible for
you to provide comparable value at a lower cost than competitors.
Features: You may provide tangible or intangible features that your competitors do not:
for example, more colors, better taste, a more elegant design, quicker delivery,
personalized service, etc.
Benefits: You may provide unique benefits to customers that your competitors cannot
match. Benefits are intangible strengths or outcomes your customer gets when they use
your offering. For example, time savings, convenience, increased control, enjoyment,
relaxation, more choices, feeling better about oneself, being more attractive, etc.
Create a list of the things that make you different from competitors in positive ways.
Then identify which of these factors are also competitive advantages: the influential
factors that help you perform better in the marketplace and cause customers to choose
your product, service, or brand over other options.
Step 3: Choose Competitive Advantages That Define Your Niche
Your list of competitive advantages represents a set of possible positioning strategies
you could pursue for your product, service, or brand. The next step is to examine how
these factors fit into customer perceptions of your broader competitive set. Your goal is
to pick a positioning approach that gives you a unique and valued position in the market
that competitors are not addressing.
How to Create an Effective Market Positioning Strategy?
Create a positioning statement that will serve to identify your business and how you want
the brand to be perceived by consumers.
1. Determine company uniqueness by comparing to competitors
Compare and contrast differences between your company and competitors to identify
opportunities. Focus on your strengths and how it can exploit these opportunities.
2. Identify current market position
Identify your existing market position and how the new positioning will be beneficial in
setting you apart from competitors.
3. Competitor positioning analysis
Identify the conditions of the marketplace and the amount of influence each competitor
can place on each other.
4. Develop a positioning strategy
Through the preceding steps, you should achieve an understanding of what your
company is, how your company is different from competitors, the conditions of the
marketplace, opportunities in the marketplace, and how your company can position

itself. Lesson
LESSON 2- Developing a Brand Name

Brand Name is a name, symbol, or other feature that distinguishes a seller's goods or
services in the marketplace. Your brand is one of your greatest assets because your
brand is your customers' over-all experience of your business. Brand strategy is a long-
term design for the development of a popular brand in order to achieve the goals and
objectives. A well-defined brand strategy shakes all parts of a business and is directly
linked to customer needs, wants, emotions, and competitive surroundings.
Experts believe that a good brand can result in better loyalty for its customers, a better
corporate image and a more relevant identity.
As more customers continue to differentiate between emotional and experienced
companies, a brand may be the first step forward in your competition instead of price
points and product features. The question is, can you build a brand which truly talks to
your audience?
Branding is a powerful and sustainable high-level marketing strategy used to create or
influence a brand. Branding as a strategy to distinguish products and companies and to
build economic value to both customers and to brand owners, is described by Pickton
and Broderick in 2001.
Commonly Used Branding Strategies
1) Purpose
"Every brand makes a promise. But in a market in which customer confidence is little
and budgetary observance is great, it’s not just making a promise that separates one
brand from another, but having a significant purpose," (Allen Adamson).
How can you define your business purpose? According to Business Strategy Insider,
purpose can be viewed in two ways:
a. Functional. This way focuses on the assessments of success in terms of fast and
profitable reasons. For example, the purpose of the business is to make money.
b. Intentional. This way focuses on fulfillment as it relates to the capability to generate
money and do well in the world.

2) Consistency
The significance of consistency is to avoid things that don’t relate to or improve your
brand. Consistency aids to brand recognition, which fuels customer loyalty.
3) Emotion
There should be an emotional voice, whispering "Buy me". This means you allow the
customers to have the chance to feel that they are part of your brand.
You should find ways to connect more deeply and emotionally with your customers.
Make them feel part of the family and use emotion to build relationships and promote
brand loyalty.
4) Flexibility
Marketers should remain flexible too in this rapidly changing world. Consistency targets
at setting the standard for your brand, flexibility allows you to adjust and differentiate
your approach from your competition.
According to Kevin Budelmann, "Effective identity programs require sufficient
consistency to be identifiable, but sufficient variation to keep things fresh and human,"
so if your old tactics don't work anymore, don't be afraid to change. It doesn’t mean it
worked in the past it may still work now.
5) Employee Involvement
It is equally important for your employees to be well versed in how they communicate
with customers and represent the brand of your product.
6) Loyalty
Loyalty is an important part of brand strategy. At the end of the day, the emphasis on a
positive relationship between you and your existing customers sets the tone for what
potential customers can expect from doing business with you.
7) Competitive Awareness
Do not be frightened of competition. Take it as a challenge to improve your branding
strategy and craft a better value in your brand.