# How to win at Markstrat (Markstrat Tips and Tricks) – Perceptions and Ideals

Following on from Markstrat market Forecast and Market Segments, I will discuss the importance of Markstrat Brand Ideals and Brand Perceptions.

# Markstrat Semantic Scales and Multidimensional Scaling

There is two main market research data, Semantic Scales and Multidimensional Scaling, both have their advantages, Semantic Scales are more closely tied to product characteristics, new products must use Semantic Scales Ideal Values when designing the characteristic of products. Multidimensional Scaling combines the multiple characters into three simplified groups, this makes it a lot easier to change Brand Perceptions with advertising as you can chose two of the three, rather than two of the five.

It is important to note, Ideal Values are constantly evolving, so forecasting is required. Additionally, Ideal Values change by spending on Advertising to change Perceptions.

Plotting the Ideal Values of a given segment (Savers) and it can be observed that each characteristic is evolving at a different pace. If the current period’s Idea Values are used, they would have changed by next period. Add similar linear trend lines and the Ideal Values of each characteristic can be extrapolated.

Below shows variance between the trends of four points and actual periods ideals.

There is significant deviation between Processing Power and Design Index, possibly from the ranking of Importance of Characteristics. Companies will generally change Brand Perceptions (through advertising) of the important characteristics, which intern would alter the Ideal Values.

 No. of Features Design Index Battery Life Display Size Processing Power Price 1.2 2.7 1.5 3.0 5.7 10.0

Similarly, the same can be done with Multidimensional Scaling, the below trends using three points and actual periods ideals.

The higher number of periods past, the closer the exploration would be to ideals.

Once we know the ideal values for a given period, this can be used to calculated the desired characteristics of a product to meet a segments ideals.

# Markstrat Product Characteristics

Let’s assume we want to create an ideal product for the Shoppers segment, it is know that it will take one period for development, so the Ideal Values of the following period must be forecast. If you are developing a product over multiple periods (a Vodite product), more than one period into the future must be forecast.

Using a simple past two period example, the Excel TREND formula calculates the next periods values.

Using LINEST, the direction (positive for up, and negative for down) can be calculated for determining if to round down or up, this is critical, as it can’t be assumed all characteristics are increasing.

 No. of Features Design Index Battery Life Display Size Processing Power Price Period 0 1.75 5.20 2.95 3.95 3.13 3.30 Period 1 1.81 5.24 2.89 4.04 3.30 3.41 Est Period 2 (TREND) 1.87 5.28 2.83 4.13 3.47 3.52 Gradient/Direction (LINEST) 0.1 0.0 -0.1 0.1 0.2 0.1

To calculate the characteristics from the Ideal Values, there are two methods.

## Range method

Knowing the ideal value is on a scale from 1 to 7, and knowing the range of the characteristic, one can calculate the characteristic with the following;

$Range_{min}+(Range_{max}-Range_{min})\frac{Value_{ideal}-1}{6}$

The characteristics are calculated as;

 No. of Features Design Index Battery Life Display Size Processing Power Ideal Char. 1.87 5.28 2.83 4.13 3.47 Calc Char. 7.18 7.99 45.96 22.78 44.11 Trend +ve +ve -ve +ve +ve Rounded 8 8 45 23 45

Note, the above can’t be used for price, as the range is unknown.

## Trend method

The second method is to trend ALL market product brand perceptions vs. product characteristics.

Similarly, the Excel TREND function can be used, the following characteristics are calculated;

 No. of Features Design Index Battery Life Display Size Processing Power Price Ideal Char. 1.87 5.28 2.83 4.13 3.47 3.52 Calc Char. 6.90 7.75 45.72 22.52 44.25 306.25 Trend +ve +ve -ve +ve +ve +ve Rounded 7 8 45 23 45 307

Using this method, the Recommended Retail Price (RRP) can also be calculated, it may be worth using an Exponential trend rather than Linear, since price increases are more dramatic at the higher-end of the scale.

The only difference between the two methods is the ‘No. of Features’, and it can be seen that both values were hovering around 7, but the first range method was slightly over, which rounded it up to an 8. In this example it may be worth using a 7 for the ‘No. of Features’ value.

In the next Markstrat post, marketing Advertising and Commercial Teams will be discussed.

# How to win at Markstrat (Markstrat Tips and Tricks) – Market Forecast and Segment Selection

Having recently completed the Markstrat strategic marketing simulation, I thought I would share some tips and tricks learnt along the way.

When initially starting Markstrat, all the data can be quite daunting, as you progress through the periods you get a feel for what to concentrate on.

A multiple-part series, the first part will look at Market Forecast and Market Segment selection.

# Market Forecast

Start by looking at the market forecast, determine which segments are the high-growth segments, get into these segments early. This has two benefits, establishing segment dominance and control which makes it difficult for competitors to enter the segment, secondly, the high-volumes help to decrease unit costs over time.

Plotted is the market forecast of each segment with an exponential trend line, forecasted additional three periods in the future. Shoppers and Savers clearly have the highest market growth in this example.

Integrate the equations between period 0 and 8 to get total volume.

 Segment Equation Total over 8 periods Explorers y = 231764e-0.029x 1,654,717 Shoppers y = 176438e0.2592x 4,733,251 Professionals y = 160089e0.1414x 2,376,865 High Earners y = 146295e0.1815x 2,637,148 Savers y = 280506e0.1738x 4,868,505

One thing to consider is these two segments also have the smallest margins.

An estimated simple Contribution Margin can be calculated using Recommended Retail Price minus Base Cost for each existing product. The summation of market share of each product multiplied by the calculated CM of each product gives as estimated CM per market segment.

 Product Est. CM Explorers 262 Shoppers 221 Professionals 299 High Earners 286 Savers 199

Using the total volume of each segment multiplied by CM of each segment, we get the following segment total CM.

When semantic scales are available from period one, we can associate price perceptions to actual prices, adding in an exponential trend gives a rough price perception to actual price equation. Semantic scales will be discussed in more detail next part.

Using ideal values for each segment, we can get a rough price for each segment.

 Segment Ideal Values RRP = 147.77e0.1955x Explorers 3.5 294 Shoppers 3.4 288 Professionals 5.7 449 High Earners 5.3 420 Savers 2.3 231

An estimated base cost for each segment can be determined by summing the products of individual product’s base cost and individual product’s segment market share. With the estimated segment product cost and estimated base cost, the estimated contribution margin per segment can be calculated.

 Product Est. CM = 147.77e0.1955x Est. Base Cost Est. Total CM Explorers 294 169.839 124 Shoppers 288 120.982 167 Professionals 449 211.426 237 High Earners 420 200.058 220 Savers 231 74.964 156

Again, the Professionals and High Earners segments, as expected, have the highest contribution margins.

Finally, plotting the total contribution of each market segment calculated by the segment CM multiplied by the total segment size. It can be seen that Shoppers and Savers are still the higher earning segments, even though Professionals and High Earners have higher contribution margins, though the contribution growth is slightly slower.

It should be noted that spending more budget in a Market Segment naturally increases the market segment size. Companies moving into the high-growth segments will naturally fuel the segment’s growth in a virtuous circle, while the abandoned low-growth segments continue to die in a vicious circle.

# Review of generic USB to Serial (RS232) adaptors

Having purchased a number of generic USB to serial adaptors from eBay, I thought I would go over the pros and cons of the types available.

# Prolific USB-to-Serial Comm Port (counterfeit)

The least expensive of those found on eBay, apparently these have a counterfeit Prolific chip, which limits them to working only on Windows XP.

Please be warned that counterfeit (fake) PL-2303HX (Chip Rev A) USB to Serial Controller ICs using Prolific’s trademark logo, brandname, and device drivers, were being sold in the China market. Counterfeit IC products show exactly the same outside chip markings but generally are of poor quality and causes Windows driver compatibility issues (Yellow Mark Error Code 10 in Device Manager). We issue this warning to all our customers and consumers to avoid confusion and false purchase.

As you can see on my Windows 7 machine I have the Code 10. I have had this cable working fine on a Windows XP machine though.

# USB-SERIAL CH340

With very similar packaging to the counterfeit Prolific above, and slightly more expensive, you can find these on eBay by search for Windows 7 compatible. These use the CH340 USB to serial IC and don’t have any problems installing on a Windows 7 machine. I have found that some serial devices do not like this adaptor, which made resulted in the purchase below.

# Prolific USB-to-Serial Comm Port

Possibly the real deal, and slightly more expensive then above. This Prolific PL2303 USB to serial adaptor has no problems installing on Windows 7, and my Solar Inverter which I was using to test, had no problems communicating unlike the above.  If you don’t want to waste time, get this adaptor, easily spotting with the black housing.

# Correspondence with Property Manager LJ Hooker Belmont WA – Tenant leaves

Having recently received my bond and completed my transactions with LJ Hooker Belmont WA, I thought I would share my last agent property manager facts.

On 24th January 2013, my LJ Hooker Belmont WA Property Manger informs me that the tenant “has admitted that he cannot pay the rent”, owes $1850 in unpaid rent and a large amount of damages to the property. On 31st January 2013, the keys are returned and the next day the property manager and I visit the property for the first time since vacated. The place was in a mess, but what surprised me the most was the damage to my property that was never reported in any off the LJ Hooker property inspection reports. I could only assume they did all this while they were vacating the property; • Broken dinning room glass window, boarded up with graffiti on the exterior • Installed a door latch on one of the bedrooms • Installed at least one screw in the wall to hold up picture frames • Large holes in the wall, possibly from a self-installed shelf • Plenty of blu-tac around • Broken glass ceiling lamp shades • Globes missing • Missing door handle on interior door • Cigarette burn marks in the bathroom, living room and on window sills. In total my insurer AMA Insurance broker and CGU quoted the repair work at$4,270. During inspection I also discovered the tenants pried the shed open and stole my wheelbarrow and vintage model Singer sewing machine.

The real kicker is I am now self managing and getting $420 a week, that is 20% more than I was getting with LJ Hooker Belmont or over 30% more if you don’t include their 9.25% of management fees. Enjoy the photos. # Asus Slate EP121/B121 disassemble and BIOS replacement Recently, I upgraded my Asus Slate EP121 to the latest 704 BIOS version, through the inbuilt BIOS flash utility and unfortunately I bricked it (failed to power on or boot). It was out of warranty, and even if it was in warranty, a failed BIOS upgrade is not covered. A bit of googling revealed that it was a fairly common occurrence, which then led me to Joe Kabalan from Advanced Quality Systems LLC who was able to provide a replacement BIOS for$20 plus $6 postage to Australia. To replace the BIOS chip of the EP121 or any surface mount device (SMD) I recommend the following tools; • rework station or heat gun ($50 from eBay)
• tweezers (few dollars from eBay)
• solder paste
• solder flux
• thermal compound is needed specifically for the Asus Slate

Start by removing the back cover of the unit, start at the USB ports and slowly unclip the clips by sliding a credit card between the back cover and unit.There is a ribbon cable connecting the thermal sensor to the back cover, carefully dislodge the cable from the socket.

Near the HDMI port you will notice the BIOS chip tucked away under the metal frame. Convenient.

Remove the battery by removing the four screws and disconnecting the cable.

Remove the fans and heat pipe. Remove all screws surrounding the metal frame to detach it from the main unit.

Turn the removed frame and motherboard over and remove all screws holding the motherboard to it.

Once the frame is removed you can access the BIOS chip.

# HP MicroServer N40L and Gigabit HD 6450 horizontal flickering line

I recently purchased a HP MicroServer N40L and half-height Gigabit Radeon HD 6450, after installing Windows 8 I noticed that a third from the screen was a flickering white horizontal line, noticeable when playing movies in full screen or moving the mouse around the right start bar.

The problem doesn’t lie with the MicroServer of Windows 8 (or even your monitor), it is the Gigabit Radeon HD 6450 at fault here. Luckily, there is a relatively easy fix, a BIOS update.

3. Install Easy Boost
4. Follow the “VBIOS backup” procedure, you will also find your BIOS type either F1# or F2#, mine was F21
5. Download the correct BIOS (F11 if you have F1# or F22 if you have F2#), you can also see the BIOS offers “Fixed screen flicker problem”
6. Follow the “Flash VBIOS” procedure.
7. Reboot

Thanks to this RedFlagDeals post for the procedure.

# Calculate last business day in month with Excel

Here is a quick post to calculate the last business day in a month taking into account holidays.

This is useful for with finance calculations and wanting to know a bank’s last banking day in a month.

=WORKDAY(EOMONTH(A2,0)+1,-1,holidays!A:A)

Where;

• Cell A2 is the reference month cell
• Range holidays!A:A is a list of holidays