Marketing Strategy

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• Marketing Strategy

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ROAD MAP Previewing the Concepts

• Companywide strategic planning
• Four steps.
• business portfolios and growth strategies.
• How marketing works with its partners to create
  and deliver customer value Customer
  Relationships.
• Marketing strategy and mix
• Forces that influence it.
• Marketing management functions
• Elements of a marketing plan.

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ROAD MAP

• Companywide strategic planning
• Four steps.
• business portfolios and growth strategies.
• How marketing works with its partners to create
  and deliver customer value Customer
  Relationships.
• Marketing strategy and mix
• Forces that influence it.
• Marketing management functions
• Elements of a marketing plan.

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Strategic Planning

• Process of Developing and Maintaining a Strategic
  Fit Between the Organizations Goals and
  Capabilities and Its Changing Marketing
  Opportunities.

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Step 1The Mission Statement

• A statement of the organizations purpose
• What it wants to accomplish in the larger
  environment
• Should be market oriented and defined in terms of
  customer needs.

What is our Business?
Who is the Customer?
What do Consumers Value?
What Should our Business Be?
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Mission Statements Should
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Good Mission Statements
Focus on limited number of goals
Stress major policies and values
Define major competitive spheres
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GEs breakthroughs in the process of desalination
crosses multiple competitive spheres
By 2015, two-thirds of the world will be
water-stressed. Desalination plants like this one
help to relieve water shortages.
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Motorola
The purpose of Motorola is to honorably serve
the needs of the community by providing products
and services of superior quality at a fair price
to our customers to do this so as to earn an
adequate profit which is required for the total
enterprise to grow and by doing so, provide the
opportunity for our employees and shareholders to
achieve their personal objectives.
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Product Orientation vs. Market Orientation
Company Product Market
Missouri-Pacific Railroad We run a railroad We are a people-and-goods mover
Xerox We make copying equipment We improve office productivity
Standard Oil We sell gasoline We supply energy
Columbia Pictures We make movies We entertain people
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Step 2Setting Company Objectives and Goals
Companys Mission -gt Objectives Business
Objectives Marketing Objectives Marketing
Strategies and Programs
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Step 3Business Portfolio

• Collection of businesses and products that make
  up the company.
• The company must
• analyze its current business portfolio
• Strategic Business Units (SBUs),
• decide which SBUs should receive more, less, or
  no investment,
• develop growth strategies for growth or
  downsizing.

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Characteristics of SBUs

• It is a single business or collection of related
  businesses
• It has its own set of competitors
• It has a leader responsible for
• Strategic planning
• Profitability
• Efficiency

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Analyzing Current SBUsBCG Growth-Share Matrix

Relative Market Share High
Low
?

• Question Marks
• Low share SBUs in high growth
• markets
• Require cash to hold
• market share
• Build into Stars or phase out

• Stars
• High growth share
• May need heavy
• investment to grow
• Eventually, growth will slow

Market Growth Rate Low High

• Cash Cows
• Low growth, high share
• Established, successful
• SBUs
• Produce cash

• Dogs
• Low growth share
• Generate cash to sustain self
• Do not promise to be cash
• sources

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Problems With Matrix Approaches
Can be Difficult, Time Consuming, Costly to
Implement
Difficult to Define SBUs Measure Market
Share/Growth
Focus on Current Businesses, Not Future Planning
Can Place too Much Emphasis on Growth
Can Lead to Poorly Planned Diversification

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Ansoffs Product-Market Expansion Grid
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Growth at Starbucks
To maintain its phenomenal growth in an
increasingly over-caffeinated marketplace,
Starbucks has brewed up an ambitious,
multi-pronged growth strategy.
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Starbucks Product/Market Expansion Grid

• Market Penetration make more sales to current
  customers without changing products.
• How? Add new stores in current market areas
  improve advertising, prices, menu, service.
• Market Development identify and develop new
  markets for current products.
• How? Review new demographic (seniors/ethnic
  consumers) or geographic (Asian, European,
  Australian, South American) markets.
• Product Development offering modified or new
  products to current markets.
• How? Add food offerings, sell coffee in
  supermarkets, co-brand products.
• Diversification start up or buy businesses
  outside current products and markets.
• How? Making and selling CDs, testing restaurant
  concepts, or branding casual clothing.

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Marketings Role in Strategic Planning
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The Business Unit Strategic Planning Process
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SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats
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Market Opportunity Analysis (MOA)

• Can the benefits involved in the opportunity be
  articulated convincingly to a defined target
  market?
• Can the target market be located and reached with
  cost-effective media and trade channels?
• Does the company possess or have access to the
  critical capabilities and resources needed to
  deliver the customer benefits?

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Market Opportunity Analysis (MOA)_2

• Can the company deliver the benefits better than
  any actual or potential competitors?
• Will the financial rate of return meet or exceed
  the companys required threshold for investment?

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FedEx
FedEx added Sunday deliveries based on customer
requests and market demand
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Opportunity Matrix
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Threat Matrix
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Porters Generic Strategies
Overall Cost Leadership
Differentiation
Focus
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The Star Alliance
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Categories of Marketing Alliances
Product or Service Alliances
Promotional Alliances
Logistics Alliances
Pricing Collaborations
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Feedback and Control
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Value Delivery Network
Companys Value Chain
Distributors
Suppliers
Customers
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The Value Chain
Wal-Marts ability to offer the right products at
low prices depends on the contributions from
people in all of the companys departmentsmarketi
ng, purchasing, information systems, and
operations.
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The Value Delivery Process
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Nike Creates Value
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Improving Value Delivery the Japanese Way
0 customer feedback time
0 product improvement time
0 setup time
0 defects
0 purchasing time
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3 Vs Approach to Marketing
Define the value segment
Define the value proposition
Define the value network
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Porters Value Chain
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Benchmarks
Organizational costs and performance measures
Competitor costs and performance measures
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Core Business Processes
Market sensing
Customer relationship management
Fulfillment management
New offering realization
Customer acquisition
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Wal-Marts stock replenishment process is
legendary
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Characteristics of Core Competencies

• A source of competitive advantage
• Applications in a wide variety of markets
• Difficult to imitate

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Netflixs Distinctive Capabilities
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Challenges Facing CMOs
Doing more with less
Driving new business development
Becoming a full business partner
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ROAD MAP

• Companywide strategic planning
• Four steps.
• business portfolios and growth strategies.
• How marketing works with its partners to create
  and deliver customer value Customer
  Relationships.
• Marketing strategy and mix
• Forces that influence it.
• Marketing management functions
• Elements of a marketing plan.

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Managing Marketing Strategy and Marketing Mix
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Market Segmentation

• The process of dividing a market into distinct
  groups of buyers with different needs,
  characteristics, or behavior who might require
  separate products of marketing programs.
• A market segment consists of consumers who
  respond in a similar way to a given set of
  marketing efforts.

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Target Marketing

• Involves evaluating each market segments
  attractiveness and selecting one or more segments
  to enter.
• Target segments that can sustain profitability.

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Market Positioning

• Arranging for a product to occupy a clear,
  distinctive, and desirable place relative to
  competing products in the minds of target
  consumers.
• Process begins with differentiating the companys
  marketing offer so it gives consumers more value.

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The Marketing Mix

• The set of controllable, tactical marketing tools
  that the firm blends to produce the response it
  wants in the target market.

• Consists of the 4 Ps
• Product
• Price
• Place
• Promotion

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The 4 Ps of the Marketing Mix
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The 4 Ps 4 Cs of theMarketing Mix

• 4 Ps - Sellers View
• Product
• Price
• Place
• Promotion

• 4 Cs - Buyers View
• Customer Solution
• Customer Cost
• Convenience
• Communication

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Managing the Marketing Effort
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Major Sections of Product/Brand Plan
Executive Summary
Current Marketing Situation
Analysis of Threats and Opportunities
Objectives for the Brand
Marketing Strategy
Action Programs
Marketing Budget
Controls
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Evaluating a Marketing Plan

• Is the plan simple?
• Is the plan specific?
• Is the plan realistic?
• Is the plan complete?

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Marketing Department Organization
Functional Organization
Market or Customer Organization
Geographic Organization
Product Management Organization
Combination of Two or More
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Marketing Control Process
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Rest Stop Reviewing the Concepts

• Explain companywide strategic planning and its
  four steps.
• Discuss how to design business portfolios and
  develop strategies growth and downsizing.
• Assess marketings role in strategic planning and
  explain how marketers partner with others inside
  and outside the firm to build profitable customer
  relationships.
• Describe the elements of a customer-driven
  marketing strategy and mix, and the forces that
  influence it.
• List the marketing management functions,
  including the elements of a marketing plan.