Who are “Distributors”?

1. Distributors (or wholesalers) buy products in bulk

amounts from one or more than one producers and supply
them to the retailers

2. Producers sell their products through distributors because

potentially distributors have the best knowledge about
the network of retailers in a certain geographic location
and have many retailers on their distribution list

3. Distributors provide INSTANT MARKET COVERAGE to

producer’s products

Copyright: Raja Shuja-ul-Haq (2009)

 The role of distributor and retailers for a company

Consumer
s
Company
1 Retailer 1

Company
2
Retailer 2

Distributo
Company r Retailer 3
3

Copyright: Raja Shuja-ul-Haq (2009)

 Intermediaries in product distribution
(Intermediation)
Consumer
s
Producer
1 Retailer 1

Producer
2
Retailer 2

Distributo
Producer r Retailer 3
3

Copyright: Raja Shuja-ul-Haq (2009)

 Disintermediation

Consumer
s
Producer
1

Disintermediation:
Cutting out intermediaries
(distributors and retailers)
Producer to sell directly to
2 consumers

Producer
3
Backward Integration:
When customers have access
to directly purchase from the
producer rather than the
retailers

Copyright: Raja Shuja-ul-Haq (2009)

 Who are “Agents / Brokers”?

1. Agents / brokers sell the producer’s product or

service on a commission basis, personally to the
customer

2. A common example of such a category is a travel

agent who sells airline tickets on a commission basis

3. Commission is a small percentage of profit which is

given to the agent by the producer on each sale

Copyright: Raja Shuja-ul-Haq (2009)

 The role of agents for a company

Consumer
s
Company
1

Company Agent
2

Commissio
n
Company
3

Copyright: Raja Shuja-ul-Haq (2009)

 Competitive Advantage

Copyright: Raja Shuja-ul-Haq (2009)

 What is “Competitive Advantage”?

“A factor which gives a special /

distinctive advantage to a
company over its competitors”

Copyright: Raja Shuja-ul-Haq (2009)

 A “more-elaborated” definition

A company’s strength relating to

something of value to the customers,
which the competitors of the company do
not possess and can not possess anywhere
in the near future

A Patent (i.e. legal rights to solely sell a

certain “invention”) is the most simple
example of a competitive advantage

Copyright: Raja Shuja-ul-Haq (2009)

 If a company’s
“distinctive advantage” is
not sustainable, then it is
not a competitive
advantage …

Copyright: Raja Shuja-ul-Haq (2009)

 “Having a
competitive
advantage is like
having
- Anonymous a gun in a
knife fight …”

Copyright: Raja Shuja-ul-Haq (2009)

 How is “Competitive Advantage”
achieved?

A major source of competitive advantage comes from

a combination of “brand” and “supply chain”
advantages

Brand: a make of product which can be recognized by name or

design
Supply Chain: the manufacturers, wholesalers, distributors
and retailers who contribute in turn to the process of making
raw material into finished goods and services and delivering
them to the customers

Copyright: Raja Shuja-ul-Haq (2009)

 Brand Advantage usually refers to the advantage a
product gains over its competitor products for having a
more renowned and well-reputed brand …

Supply Chain Advantage usually refers to the advantage a

product gains over its competitor products for being more
widely and conveniently available in a given geographic
market …

Copyright: Raja Shuja-ul-Haq (2009)

 This familiar diagram covered in the previous slides
depicts a company’s supply chain

Brokers / Agents
Commission

Supplier

Marketing Sell Sell Sell

Distributo Retailer Customer
Agency r
$15 $17 $20
Shipment
Agency
Producer Taking the product to the
$10 customer
Gathering supplies and
services to produce and
market the product

Copyright: Raja Shuja-ul-Haq (2009)

 How is “Competitive Advantage”
achieved?

Supply Chain Advantage

High Low

High

Market Leaders Expensive Brands

Marketing /
Brand
Advantage

Cheap Generics Market Losers

Low

Copyright: Raja Shuja-ul-Haq (2009)

 Customer Marketing
Mix

Economic Psychological (4Ps)

Performance Self Image Key Customer Competitive
Requirements Advantage Product
Availability Quiet Life
Reliability Pleasure Price

Durability Convenience Placement

Productivity Risk Reduction Promotion

Copyright: Raja Shuja-ul-Haq (2009)

 4. Internal Analysis

Copyright: Raja Shuja-ul-Haq (2009)

 The Marketing Environment Models for
Evaluation
Marco-
environment PESTEL

Task
Environment
5-Forces
Model
Company
SWOT Analysis

Customers-
Collaborators-
Competitive Competitors Model
Environment
(3Cs Analysis)

Copyright: Raja Shuja-ul-Haq (2009)

 Internal Analysis :
What organizations should ask themselves?

 What are we doing right?

 What are we doing wrong?

 What are our internal strengths?

 What are our internal weaknesses?

Copyright: Raja Shuja-ul-Haq (2009)

 Internal Analysis: Using the SWOT
Analysis

 SWOT stands for Strengths, Weaknesses, Opportunities and

Threats

 SWOT should come at the end of the Marketing Audit and

summarize it

 SWOT Analysis provides (should provide) an interesting and

readable summary of the present state of the business and the
external factors and trends impacting on it

Copyright: Raja Shuja-ul-Haq (2009) IMPORTANT

 OT Analysis
Analyzing Opportunities and Threats

SW Analysis
Matching Strengths and
Weaknesses with Opportunities
and Threats

Copyright: Raja Shuja-ul-Haq (2009)

 STRENTHS WEAKNESSES

Strengths should be Weaknesses should be

used to capitalize on corrected so as to
available opportunities avoid potential threats
in the market and efforts
Conversion should be
Strategies
made to convert
weaknesses to
Matching Strategies
strengths

OPPORTUNITIES THREATS

Threat should be seen

Opportunities should
as potential
be utilized for the
opportunities i.e. what
company’s advantage
the company can do in
and new strengths can Conversion Strategies
the future but has not
be generated from
been doing as yet
them

Copyright: Raja Shuja-ul-Haq (2009) IMPORTANT

Copyright: Raja Shuja-ul-Haq (2009)
Copyright: Raja Shuja-ul-Haq (2009)
 SWOT Analysis
an exemplary implication on a research sample

Copyright: Raja Shuja-ul-Haq (2009)

 Marketing Strengths of the research sample
Superior brand-building and communication
skills
Efficient in managing relationship with the
stakeholders.
Vigilant in finding new opportunities in the
marketplace.
Marketing planning is free from any evident
deficiencies.
Market Opportunities available
(Utilizing strengths to turn weaknesses into opportunities)
The research sample can use their superior
brand-building and communication skills and
their ability to pinpoint market opportunities
to enter new growth markets.
If internet technologies are properly utilised,
new doors to the marketplace can be opened
and new marketing strategies can be
developed to reach out to the target customers.
Copyright: Raja Shuja-ul-Haq (2009)
Marketing Weaknesses of the research sample
Weak in accurately identifying the target
customers
Inadequate skills of accurately defining and
monitoring the competitors
Insufficient use of internet technologies
Potential Threats
(Ignoring weaknesses and finding no appropriate solutions)
The research sample is not making sufficient
use of internet technologies, which might turn
out to be a big disadvantage for them in the near
future.
Inability to identify competitors in the market
place can make the business more vulnerable to
competitive attacks; which might even come
from a different sector of the leisure market.
 Please BEWARE

 Inherent simplicity of the SWOT

Analysis is often its undoing

 It can become vague, confused,

irrelevant, lacking in direction

Copyright: Raja Shuja-ul-Haq (2009)

 Always remember …

A “strength” is only a true

strength if you are clearly
stronger than your competitors
on that attribute or if it is of
some value to your
customers !!!

Copyright: Raja Shuja-ul-Haq (2009)

 Similarly …

An “opportunity” is only a
true opportunity if it fits your
internal capacity and is
possibly doable !!!

Copyright: Raja Shuja-ul-Haq (2009)

 Furthermore …

Mangers (while using the

SWOT) put their strategies
and tactics as opportunities
which is wrong …
Opportunities (and threats)
exist outside the company –
the things we propose to do
about them are our strategies
Copyright: Raja Shuja-ul-Haq (2009)
A very useful tip for SWOT users …

Your “strength” should always

be narrated in the SWOT as a
beneficial value to the
customer.
For example, “longest established brand”
can be narrated as “more customer
knowledge, market understanding and
brand security”

Copyright: Raja Shuja-ul-Haq (2009)

A very useful tip for SWOT users …

Your “weakness” should

always be narrated in the
SWOT as a failure on behalf of
the company to satisfy the
customers better
For example, “weak at identifying new
product technologies” can be narrated as
“weak at offering innovative value to the
customers”
Copyright: Raja Shuja-ul-Haq (2009)
 Customer-oriented interpretations of strengths and
weaknesses

Strength Statement: Subsequent Weakness:

“We are an old established
 Inflexible
firm”
 Old-fashioned

 No innovation

True Strength:
 Stable suppliers for after-
sales
 Trust-worthy
 Experienced

Copyright: Raja Shuja-ul-Haq (2009)

 Customer-oriented interpretations of strengths and
weaknesses

Strength Statement: Subsequent Weakness:

“We are a large supplier”
 Bureaucratic

Offhand with customers

No continuity of personal

contact
True Strength:
 Comprehensive product range
 High status / stability reassures customers

Copyright: Raja Shuja-ul-Haq (2009)

 Marketing Plan

Copyright: Raja Shuja-ul-Haq (2009)

 The Marketing Plan

Marketing Objectives

Marketing Audit
Marketing Audit involves STP
and the 4P
decisions !!
SWOT

Assumptions

Feedback

Marketing Objectives / Strategies

Measure / Review

Estimate Results

Programmes Alternative Plans / Mix

Copyright: Raja Shuja-ul-Haq (2009) IMPORTANT

 Marketing Plan looks like hard work …

WHY DO WE EVEN BOTHER?

Copyright: Raja Shuja-ul-Haq (2009)

 10 Benefits of Marketing Plans

 Hitting the best customer targets

 Winning new customers
 Expanding markets
 Beating the competition
 Keeping abreast to market developments
 Using resources to best advantage
 Improving internal communication
 Minimizing threats to reduce risk and surprise
 Identifying company strengths and weaknesses
 Achieving consistency

Copyright: Raja Shuja-ul-Haq (2009)

Technology Influences on Today’s Marketing

Copyright: Raja Shuja-ul-Haq (2009)

 Technology’s Growing Role in Marketing:
Pyramid Model

Company
Internal External
Marketing Marketing

Technolog
y

Employee Customer
s s
Interactive
Marketing
Copyright: Raja Shuja-ul-Haq (2009) 40
 So, where have we reached ?

Copyright: Raja Shuja-ul-Haq (2009)

  Marketing: anticipating and satisfying customer requirements
at a profit
 Customer focus: at the very center of the company’s universe
 Market-driven will be profitable than product-driven
 Company values dictate orientation
 Marketing is conducted at four organisational levels
 Companies exist within three environments: macro, micro and
task
 We can influence the micro, but not the macro
 We must take great care with our competition
 Competitive advantage can be derived from a combination of
“brand” and “supply chain” advantages
 Internal resources must match strategies
 The marketing plan – bringing it all together

 Marketing planning keeps us ahead!!!

Copyright: Raja Shuja-ul-Haq (2009)

 Bibliography

Jobber, D., Principles and Practice of Marketing, 3rd edition,

Berkshire: McGraw-Hill

Kolah, A., Essential Laws for Marketers Oxford: Butterworth-

Heinemann

Kotler, P., and Armstrong, G., Marketing: an introduction,

Prentice-Hall International Edition

Philip R. Cateora & John L. Graham, International Marketing

Eleventh Edition, London: McGraw-Hill

Piercy, N.F., Market-Led Strategic Change, 3rd edition, Oxford:

Butterworth-Heinemann

Faculty Notes: Kellogg on Marketing, Kellogg School of

Management USA
Copyright: Raja Shuja-ul-Haq (2009)