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The Value Chain by Jovan Maric

 

 

 

I was watching a programme the other night, you might have caught it, it was called ‘Made in Britain’.  It was about Britain’s place in the world when it comes to manufacturing and how that has changed over the last few decades.  We all know that China, India, Taiwan, Russia, Mexico and many more countries can all now make stuff much cheaper than we ever could so you’d imagine that manufacturing is dead and we’re all doomed.  Wrong.

It was a genuinely interesting programme for a whole bunch of reasons but the one thing that I found really interesting was something called the ‘value chain’. I kind of new it existed but i’d never heard it being explained this way before. Okay, so there are basically three stages in the value chain:

When a company wants us to help promote their product or service we create the campaign and the means of communication. Innovation and Invention

Manufacturing

Marketing, Branding and Advertising

The British it would seem, with all its smart people, fantastic universities and access to capital, is great at inventing stuff because, well, you have to be pretty clever to spot a need and then invent the solution. Of course it sometimes already exists, but we’re quite good it turns out at improving products that are already on the market. So Britain is still a market leader in the business of innovating and inventing.

The second stage we’ve already established we’re not so competitive at – notice how I said competitive instead of good at, because I think we just can’t compete on price anymore – if we could I reckon we’d be market leaders in stage two as well.

The third stage is all about marketing, branding and advertising which we are reallygood at. They cited the Rowntrees brand (and Kit Kat bars specifically) which Nestle bought for billions of pounds, because we had built such an amazing brand, but its not just Rowntrees, we’ve got some great brands in our locker and some fabulous creative agencies that help us get it out there.

But not only are we really good at the first and third elements of the value chain, they’re also quite fortunately the most lucrative! They cited on the show (and I may have the second figure wrong but not by much) that when an Apple iPod is sold Apple get $80 and the company that makes the thing gets $5 for every unit! That is the value of creating a product and being so good at making people queue overnight to get their hands on it!

So you may be wondering why is a guy from a creative agency rambling on about manufacturing! Well it got me thinking about Square Daisy and where we fit into the value chain, and then it hit me – we are in all three stages!

When a company wants us to help promote their product or service we create the campaign and the means of communication. Depending on what our clients want we then make or build the video or the app and create a strategy to help them get it out there and market what they are doing. This is a microcosm of the actual big picture, in the grand scheme of things we’re a leader in stage three………but I’m more of a starter and main course man than dessert, so I had to find a way of getting in all three areas!

‘Til next time…

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