hi every new year are shows in the markstrat season spread over multiple programs and multiple batches i would have taught markstar for 300 hours and for over a thousand students markster typically is starts between january and march that is pongal to holi but this year thanks to kobin markster just got pushed by about 60 days as all other academy calendars and we are starting from march and maybe ending in may so march has come and here we go the title for this video is 10 tips to win stratt i have divided the 10 tips into two five at an individual tactical level and five at a team strategic level the individual practical tips are one product design two product portfolio three production numbers four product promotion and five shifting consumer taste how do you understand your shifting consumer taste this has to be taken care of by one player in the team by and large the team effort ones or the strategic ones are what is your timing to market two how do you have a balanced approach three how do you trade off between market share and margin your share margin trade-off four how do you keep a close eye on competition and five how this is poorly intrinsically a good genuine team game so these are the 10 tips we will have each of them for about a minute minute and a half the entire video i promise you might not be more than 20-25 minutes so here we go tip number one product design the game starts with something called the sonite market as you know markstrad is a hypothetical market and there are two product categories sonites and bodies so the well-defined market in which you start the game is called the solid market and you will shortly find that the sonite has got five clearly defined customer segments or customer clusters and you have to design products which will suit the requirement for each of these clusters so as it goes with any product design you can either go for a minimalistic design which is also a good design or a fully loaded design which is also a good design the nano nano level product works for one type of customers the ferrari level product works for another type of customers so how do you decide which is your target market how do you understand what are the functionalities what are the conveniences what are the features that that particular market looks into how do you do a semantic scale understanding how do you put in conjoined analysis all these inputs are available to you so using all these techniques and tools how do you create the right product for the right market or if i may use a phrase how do you have the right horse for the right course that is where you win there is nothing called a good or a bad product all products are good as long as they are perfectly aligned at the design level to a particular target market this is your winning tip number one tip number two product portfolio as i mentioned to you in the first tip for the sonic market there are clearly well delineated clusters five of them shoppers savers high earners professionals and explorers what these people buy where they buy at what price point they buy what is their performance expectation what is their convenience expectation for the product all these things are very very clearly different and markster allows you at any given point to have a maximum of five products you would shortly know when you're starting the game that you're allowed to start only with two products so when you're starting the game the computer already gives you two products in sonite so from these two you can build your portfolio up to five so two then three then four then five so what you do is your game number one would be how to align as much as possible the two given products to any of these segments there are five segments and you have to sort of align the existing products which you have to any one of these two segments and then you have the luxury of creating three completely new products you understand the nuances of the segment totally so your entire design in creating the product portfolio should ensure that you do a perfect fitment of the new product for the new target segment and once that is done your complete product portfolio for sonite gets completely defined we have not yet talked about the bodite market vodat if i may is a blue ocean market hill refined market the category is an unknown category so we do not know who exactly would be the consumer and what could be his tendency to buy what would be his requirement requirement nuances is not something which is known a priori so it's sort of a blind man's buff so we have to go for the traditional product development lifecycle approach in which we divide the potential customers into three the innovators who are the early ones in the market then the early adopters which is a classic game and then slowly the followers so when you are designing something for the vodite market which should happen in the fourth fifth and subsequent rounds you have the trade-off of do you start creating only for the innovator and then wait for the next product or do you start straight away for the early adopter and then it can catch on in the second round and things like that these are trade-offs which will be explaining in subsequent points but right now what you need to understand it you need to maintain a perfect product portfolio tip number three production numbers or what we call in classic operations as production planning and control let me try to give you an advantage that markstrad will give you which real markets do not marxtra act on its own allows a plus or minus 20 correction of your production if the actual markets usage for the subsequent year is mismatched from your calculation that is if you are going gung-ho about a calculation it corrects to a limit of 20 downwards and if you are pessimistic about your calculation it corrects 20 percent of ports but if your error goes beyond this 20 percent god bless okay now let us look at three completely different scenarios and how do you understand production planning and control and we will try to look at two flip sides one is there going to be a lost sale or an opportunity loss and two are you going to carry unnecessary inventory scenario number one your understanding of the market and your understanding of the future demand for this particular product for the ensuing 12 months the next one cycle is reasonably good and whatever you have predicted after the 20 correction gets into such a way that you neither have a loss sale nor have an inventory which is a perfect scenario but that doesn't happen what could happen most of the times is somebody in the team becomes gung-ho let us make let us make that sort of pitch you get into a very very optimistic mood and you tend to over produce when you're over producing the question of last sale does not happen at all because you have tons of production with you tons of products with you so every sale is catered to the market but at the end of the year the flip side is you're going to carry inventory but obviously you're going to incur inventory carriage cost the other side would be a very very pessimistic approach a very very toned down approach let me do the minimalistic sort of game and try to make as minimum production as possible the advantage for that is you will not have any ending inventory so you can sort of practice yourself on the back that inventory is clear but something else is happening you are going to have something called last sale people wanted your product people know that you're good they came to you it was not available they went to a competitor so between these two scenarios over production and under production one of them is a visible loss if you're going for over production the flip side is a known flip side you're going to end up with tons of inventory but if you're going for under production the flip side is an invisible flip side you would have lost you the lost sales you would never know about it only in subsequent rounds you will know that despite other things being good your market share is slowly coming down and somebody else's market share is slowly going up that could happen only because of your under production this is the game of production numbers tip number four product promotion now look at a real market in a real market marketing is all about first creating a product or creating the value proposition and then communicating the value proposition horlicks becomes great not because the product intrinsically is good because i know that consumption of horlicks makes you taller sharper and stronger it has been communicated to you so in a mock straight also this simulation allows you this communication potential now when i am communicating there are three things that are intrinsic to understanding what is the amount of promotion intelligence that i do one what is my frequency of communication take an fmcg product they'll be there in the market almost throughout the year then take a consumer durables product they'll be there in the market during all festive seasons and then take a b-school they would be there only during the short admissions interval so my communication frequency is one parameter two what is the richness of my content and my contextuality of what i am trying to convey this is driven by the way i am communicating the text i am communicating and three the community which i am addressing today micro segmentation is possible thanks to social media so to human what is the community to which i am reaching out so these three things what is my frequency of reach out what is my content plus context mix and who is the community which i reach out this is how i broadly define my communication strategy thankfully mark start from a simulation perspective blends all these things let us try to find out how it does you can either understand it from the video or look at your own mock start simulation screens you will find in a particular screen a small double in which you are supposed to enter your media budget the media budget is an indication of the frequency in which your retards reach out to the market the total money that you pay the times of india or the z tv and the second one the second smaller number which you see below the media budget called advertisement budget that is a proxy for the quality of the content and the right timing of the context so in any real situation the amount of money which you spend to the times of india would be much much much much larger than the amount of money that is required for creating the content for times of india so you can take these two amounts as that proxies the media budget in markstrad is the money which you are spending to create your reach out and advertisement budget should be a small fraction of that media budget what fraction is up to you to choose it could be 3 4 5 10 whatever percentage and that is the richness of the content which will help you create the right communication strategy the third one would be the proration game which community you're trying to reach out to as i mentioned in one of my previous tips for every particular product there is a perfectly aligned product segment so you understand the nuances of that segment so your one extreme strategy would be 100 of the money should be appropriated or allocated to that particular segment so it is zero zero zero zero for the remaining four segments but you will know in real markets that people who are in nearby segments also tend to buy it is not that if you're pitching something for the high earners only the high earners buy both in the mock stock market and in real markets so you can apportion about 80 85 percent for the market which are aligned to and spread the remaining 10 15 20 percent across other markets in a judicious manner this is the game of product promotion tip number five shifting consumer taste now let us take one typical market take the savers market at the beginning of the game you would realize they are they are the typical so-called lower middle class or middle class in terms of aspirations they demand co-transcode the cheap product they want minimalistic convenience they want minimalistic features average performance and things like that but you should remember that this is going to be a growing market the market size and the market propensity to buy the price point in which they buy might change will change over the years your reports will tell you how these things are changing so unless you are capable of being agile in evolving with this market if you create one product and assume that that particular product at that particular price point will survive to perpetuity that is the wrong assumption so you need to adapt so the game is adapt or die if you are stuck to a particular market then you have to keep moving with that particular market and its aspirations across the board in terms of pricing in terms of design in terms of your communication strategy everything and mark start helps you to do most of these things as you do in real markets the way a live boy became a life boy plus or a self became a self excel your products also need to evolve and still cater to the same segment understanding shifting consumer taste tip number six your strategic tips start the first one is time to market let us try to understand the difference between the time to market aspect for tonight we say we voted the games are slightly different in tonight you have two time to market variations one as i told you you start with two products and you can end up going to five products so will you do one r d at a time or will you do more than one r d at a time what are the trade-offs if you do one r d at a time what is a plus nothing that's what you're expected to do what is a minus again nothing that is what you're expected to do but if you're doing two already at a time some teams get ambitious let me try to do two sonite r d's in the same round what is a plus if you're lucky you hit a jackpot and your market share simply goes up but if you goof it up you have piles of inventory with you maybe for one if you're really bad for both the new products so that could be the flip side now coming to the verdit market the trade-off is are you going to be a first mover and gain the first mover advantage or are you going to be a second mover and garner the second mover advantage what's the first mover advantage as i told you it's a blue ocean strategy you do not know much about what people really want you do not know much about product design there is no conjoint analysis data available you still go blind man's buff and if you get it right you garner a huge day one market share and you remain in the market the flip side if you get it wrong you had it the other advantage the other approach would be just wait and watch some teams do that even when they get a chance to do a vodite r d they wouldn't do a good hrd waiting for others to do the vodite and when that product hits the market if it is a good one i'll copy it if it's a bad one i'll get around it so the flip side is if somebody else gets it right he runs away with the entire market share these are the nuances of time to market tip number seven a balanced approach the most critical parameter which drives your success round after round in markstrad is what we call as the s p i or the share price index which is very close to what we call as a market share price in real stock markets so when you're starting the game your share price index for all the teams is thousand and then good teams slowly start building their share price index from there my senior teams students who are about 30 plus or 28 have got the resilience built into them to hold on hang on understand the risk mitigated and take spi from 1000 to about 3500 4000 some teams have crossed four thousand my slightly younger teams teams with students having 22 23 24 years away are slightly more risk averse so they play a safer game and they touch about 2000 to 2500 in terms of spa this is what has been happening over the past previous years things can change now how do i know how can i increase my spi there is no direct way in which i can play directly on spa but my spi is a function just like your classic regression equation y is a function of f x 1 x 2 x 3 x 4 here what are the various x 1 x 2 x 3 variables your market share obviously need to have a good market share as i told again on day one when six teams are playing each team gets computer-driven 16.67 market share but the moment round number one is completed the slightly better team moves to 18 and the slightly weaker team goes to 15 and as this progresses on you'll find the healthier teams garnering close to 30 to 40 market share and the weaker ones suddenly coming to single digit the weaker ones suddenly come into single digit so market share obviously is a critical parameter how much margin you are getting is a critical parameter as i told you a portfolio width is a critical parameter how closely aligned your products are to various target segments how much money are you willing to invest in r d how many r d projects there in the pipeline and most important one what is your cumulative net contribution take the case of a sachin tendulkar or as as jeffrey boycott's uh sasha tunnel car his average run rate once it has hit something like 58 then even if he scores a series of 30 40 30 40 for about 10 innings it is still going to remain at 50 because he's played that many number of innings he has built his net contribution good enough for bharatnam similarly for you in your initial rounds if you built enough capital if you built enough solid net contribution that will hold you in good stead even if there is a bad year any year can be a bad year so you need to have your cumulative net contribution then your time to market your timing to market your production your inventory your inventory management your feet on state management and advertisement budgeting all these things will in small parts drive spa what are the beta functions for each of them marx strat does not tell us in real markets what is a beta function for each of them we do not know but then focus on all these variables the game will eventually be good the way if you focus on all my ten tips you are going to win max track so take a balanced approach tip number eight as a team you should be completely and constantly focused on the shared margin trade-off whenever you're pricing a product or whenever you're repricing a product remember that there is only a small golden window for you to move it applies in real markets as well as marx trad market let us take pricing as a total range your minimalistic pricing would be just your cost coverage point if you price at your cost coverage point which is what the japanese call is chemical surprising you might get market share but you completely kill your contribution in fact you'll end up getting negative contribution so slowly start increasing your price till you come to the rim of the golden pricing window somewhere between the pricing window is a median price you do not know it at no point of time do we really know in in real terms what would be the median price so let us assume it is somewhere right up there and if you're going slightly below the median price you get the advantage of eating a bit more into the market gaining a bit more of market share at the cost at the cost of your individual contribution getting compromised on the other side if you are gutsy enough if you have the guts to move above the median price if you have the confidence to move above the median price if your product is really good then market share might get compromised but your products will still heavily be sold and when they're getting sold you're going to get solid margins increase price beyond a particular point and that will be a really foolish pricing and this could happen to you in buddhist because you do not have any pricing queues at all it happens in real markets it happens in markstrad in the verdict market where you end up coming coming up with a completely foolish very very high end price well these are the share margin trade-offs [Music] tip number nine have your eye on competition as in real markets markstat also gives you a plethora of information about competition it talks about what competitors producing how much inventory do they have what's a product portfolio what are their pricing signaling strategies are they getting into new products and what is their new product pricing strategy what is their ad spend how many people they have on foot on street what is their product by product market share and all these things but there is a small catch as it happens in real markets the catch is you do not have access to the current ltm data what is ltm last 12 months data now in real markets also if i can get your historic reports if you can get your balance sheets annual reports etc my competitor companies i can easily find out what they are doing what the margins they are enjoying what is the cost that they're incurring till last march 31st i wouldn't know what they are currently doing unless i have insiders planted in my competitor environment in markster there is no way you can plant an insider in a competitive environment so the most crucial information the critical uncertainty of what other teams are doing right now and how that will affect your market your product your pricing for this particular round that is an unknown that is how real markets work but the moment the current year is through you'll have all your backend data about competition and unless you do intimate intrinsic competitor analysis you are going to go nowhere so that's a key tip keep a close eye on competition tip number ten marx track is a team game in school we would have come across this innocent question 10 people take a month to build a home in how many days can one person complete it the school kid will sort of contemplate for 10 seconds and write 10 months it's a good answer for school but the real answer is one person would never be able to complete building a house same here in markztrad you have to start with the rigorous environmental analysis understand your consumer survey panels understand industry benchmarking then go to product design using semantic scales and conjoint analysis then look at your target market fitting look at the multi-dimensional scale with the field of market forecasting then get into your resource planning what is your advertisement budgeting what is your commercial team what is your feet on state budgeting simultaneously somebody else has to do a competitor analysis and then look at what are the new r d's that you need to develop do you go for weight and board strategy or you do go for a second mover advantage all these things cannot be done by one person so markstride is always a team game and the best team the team that understand all these 10 tips and implements them right on that relevant point that team there is only one winning team that team will win is it you well time will tell there are videos which if you simply watch the video you get a feel of the subject that is good enough this is not one such video you have to follow the tips you have to understand the tips i am specifically talking about kids who are going to get into my extract close to 100 of them are going to get in march and another 100 plus are going to get in me for these students you need to really watch listen take notes understand imbibe internalize and go with these tips and at unfortunately there is going to be only one winner that could be you bye bye thanks for watching like share and comment subscribe to the channel goodbye [Music]