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jerryking : positioning   3

What You Need to Know to Pick an IPO
April 7, 2019 | WSJ | By Andy Kessler.
Dig up dirt on the competition and board members, and buy to hold long-term.......How do you know which IPOs to buy? No, not to trade—you’d never get it right. Lyft priced at $72, traded at $85 on its first day, then closed at $78, only to fall to $67 on its second day. It’s now $74. I’m talking about buying and holding for a few years. Yes I know, how quaint.

The trick is to read the prospectus. What are you, crazy? That’s a couple hundred pages. Well, not the whole thing. But remember, where the stock trades on its first day is noise....... So understanding long-term prospects are critical. Here are a few shortcuts.

(1) First, glance at the underwriters along the bottom of the cover. On the top line are the banks putting their reputation on the line. If the one on the far left is Goldman Sachs , Morgan Stanley or JPMorgan , you’re probably OK.
(2) open the management section and study the directors. Forget the venture capitalists or strategic partners with board seats—they have their own agendas. Non-employee directors are the ones who are supposed to be representing you, the public investor. And their value depends on their experience.
(3) OK, now figure out what the company does. You can watch the roadshow video, look at prospectus pictures, and skim the offering’s Business section. Now ignore most of that. Underwriters are often terrible at positioning companies to the market.......when positioning companies, only three things matter: a monster market; an unfair competitive advantage like patents, algorithms or a network effect; and a business model to leverage that advantage. Look for those. If you can’t find them, pass. Commodities crumble........read the Management’s Discussion and Analysis. Companies are forced to give detailed descriptions of each of their sectors and products or services. Then flip back and forth to the Financials, looking at the items on the income statement and matching them up with the operations being discussed. Figure out what the company might look like in five years. And use my “10x” rule: Lyft is worth $25 billion—can they make $2.5 billion after-tax someday? Finally there’s the Risk section, which is mostly boilerplate but can contain good dirt on competition.
(4) Put the prospectus away and save it as a souvenir. Try to figure out the real story of the company. Do some digging.
(5) My final advice: Never, ever put in a market order for shares on the first day of an IPO.
10x  advice  algorithms  Andy_Kessler  boards_&_directors_&_governance  business_models  competitive_advantage  deception  due_diligence  howto  IPOs  large_markets  long-term  Lyft  network_effects  noise  patents  positioning  prospectuses  risks  stock_picking  think_threes  Uber  underwriting  unfair_advantages 
april 2019 by jerryking
Innovation in Private-Label Branding
Spring 2005 | Design Management Review | by Charlie Conn, Director of Branding, Proteus, Boston.

Success in private-label branding boils down to a retailer’s ability to build a brand and control and manage it on a local level to create relationships with consumers....others see innovation coming from the
private-label brands. By creating unique brand experiences for consumers, such retailers as Starbucks, Whole Foods Market, and Trader Joe’s have created truly innovative brands that encourage repeat purchases. From a private-labeling perspective, Starbucks is innovative because it provides exclusive,exclusive, private-label products that are in line with the lifestyle experience it has created. Starbucks reached the pinnacle of success in this area when
one of its exclusive private-label music CDs, “Ray Charles: Genius Loves Company,” won Album of the Year at the 2005 Grammy Awards,
after being nominated in 10 categories. This and other exclusive products contribute to the emotional benefits experienced by Starbucks’ customers, and as a result they contribute to the
bottom line. Private-label branding has been most prevalent
in supermarkets and drug chains. According to the Private Label Manufacturers Association, supermarkets rang in $42.9 billion in sales of store brands in 2003, representing 16.3 percent of overall sales.2 Drug chains reached an all-time high of $3.8 billion in store brand revenues that same year.3 In both sectors, growth of private label brands exceeded the growth of manufacturer brands....

“I’m not sanguine about the major supermarkets,” says Richard J. George, professor of food marketing at the Haub School of Business, Saint Joseph’s University, Philadelphia. “To be successful, supermarkets need to look to customers to determine the set of needs that can be uniquely satisfied. Brands are more than products on the shelf (national brand or private label.) Retailers are brands and need to focus on what the customer wants and how the retailer can positively differentiate the brand. It’s all about customers, not products. Retailers need to think like a brand and act like a retailer.”...A brand is more than just a name and logo. It’s a set of associations that lives in the consumer’s mind—the sum total of everything the brand represents for that consumer. To fully understand what a brand stands for—private-label or otherwise—retailers need to ask themselves:
• How appropriate is the brand?
• What makes it unique?
• Who are the target consumers?
• What functional, rational, and emotional
benefits does it offer consumers?
• How adaptable is it?
• Is it protectable?
Based on understanding these brand attributes, retailers can put some definitions around their positioning statements.
innovation  private_labels  branding  design  retailers  Starbucks  Whole_Foods  supermarkets  Trader_Joe's  brands  strategic_thinking  positioning 
august 2012 by jerryking

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