192 ◾ The Guide to Entrepreneurship: How to Create Wealth for Your Company
characteristics of a product/service that satisfy stated or implied customer
needs. Value-based new product offerings can best be seen in terms of a
price-quality continuum, as shown in Figure9.7.
9.5.2 Tensions between Marketing and Sales
“If you come to a fork in the road, take it.” —Yogi Berra
In a startup situation where the founders are critically looking for sales, the
marketing and sales functions are often at war. This is in spite of the fact
that everyone knows that “we all oat or sink together.” If sales are disap-
pointing, marketing blames the sales force for its poor execution of an other-
wise brilliant rollout plan.
10
Marketing traditionally accuses sales of focusing on pricing and short-term
sales at the expense of long-term prots, while sales complains bitterly that
prices are set articially high without proper regard to current market condi-
tions. Marketing personnel complain that the sales force is focused on clos-
ing deals, forsaking prots. The sales force lobbies for lower prices because
the product demand has reached its elastic limit, and it is well accepted that
the sales force often has private information about the strength of demand.
11
Marketing and sales are two sides of the same coin. However, there is
generally poor coordination between the two groups, which only raises
market launches costs, lengthens market cycles, and increases rancor and
internal disharmony. The founder must establish an unambiguous “revenue
Super value
(loss leader)
High value
(penetration)
Premium
strategy
Good value
(discounts)
Medium
value
Overcharging
(skimming)
Super economy
(predatory)
False
economy
Rip-off
Quality
Figure 9.7 Value-based products—The price-quality continuum.