The main part of our marketing course this semester was doing the “markstrat” simulation. If any of you guys took upper-year marketing classes in undergrad you probably know what it is and can skip the below paragraph.
For those who don’t: the class was divided into 6 teams. All of the teams operate in a fictional wold competing against each other and each team represents a company in that fictional world (well the marketing dept of that company to be precise). Markstrat is essentially a brand management simulation game. So if you love brand management like me, you will enjoy this! You compete against the other teams on all of the marketing 4Ps (products, pricing, promotion and place). On day x all teams input their marketing mix into the simulation for your 1st “year” of business (i.e. what products you will include, at what prices, how much to produce, etc). After you input that info, the simulation runs against everyone else’s inputs and spits out your results for your 1st “year” of business. Based on those results, you plan for yr 2 and so on.
Whoever has the highest share price by the end of the game, (sort of) wins. I’ll get to why I say “sort of” in a minute.
Anyways, so in undergrad I did the exact same simulation. However because you are playing a game against other people, a lot depends not on experience playing the game but on how the other players play too. The big difference between now and undergrad was I think in undergrad the decision-making timeline was something like this:
-On Monday we’d get the results from “year 1”
-On Friday we would have to input our plan for “year 2”
-On the following Monday, our results were made available for “year 2” and the cycle continued for the whole semester
In MBA school the timeline is this:
-At 11:15am on Tuesday you get the results from “year 1”
-At 1:15pm (that same day) you have to input your results for year 2
-On the following Tuesday 11:15am you get your year 2 results and continue
So the decision making timeline has gone from 5 days to 2 hours!! So this was another of the many learning experiences we’ve had about:
-Analyzing and interpreting market trends
-Making $$ ;-)
Also while in undergrad we were evaluated based entirely on our outcome by the end of the game, in this case we were evaluated not just in the context of the game, but long-term as well, even after we finished playing “officially”. What was really interesting about this was as we played, a certain team was absolutely murdering every other team in the market. So one might figure they were set for the long term given how well they are doing now. Well after we finished playing, our prof showed us the results if we played 1 more “year” and this team was on a nosedive.
This demonstrated a few good lessons:
-Why it is important not to rest for too long on your laurels..there is always someone else (or in this case 6 others) ready to take you down
-You need to think long-term for business success!! (even if shareholders don’t always think that way…haha)