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The
TOC approach to marketing is based on what Dr. Goldratt terms
the “Mafia Offer” or “Irrefusable
Offer” – an offer too good
to refuse.
Strong
competitive advantage is vital for any organisation to be
successful. To secure this advantage, the organisation MUST
satisfy its markets to a greater extent than the competition.
While this is
a well known fact, too many organisations do not go far enough
to secure this competitive advantage, implementing strategies
which are easily and quickly imitated by the competition.
Strategies are
often formulated based on the supplier's perception of
value - conditioned by investment in the product: design,
production, distribution, marketing etc - which assumes that
there is one fair price: cost + reasonable margin. Rarely do
organisations base their strategic decisions on the
customer's perception of value conditioned by the benefits
expected from acquiring the product. Given that different
customers have different needs and thus different perceptions
of value, strategies can be designed which allow for effective
market segmentation and product price variability.
To boost
profitability, organisations should therefore focus their
attention on two actions:
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