MARKETING

STRATEGY
 What is strategy?

• "Strategy is the direction and scope of an

organization over the long-term: which
achieves advantage for the organization
through its configuration of resources within a
challenging environment, to meet the needs of
markets and to fulfill stakeholder
expectations".
 Strategy is about:
• Where is the business trying to get to in the long-term
(direction)
• Which markets should a business compete in and what
kinds of activities are involved in such markets?
(markets; scope)
• How can the business perform better than the
competition in those markets? (Advantage)?
• What resources (skills, assets, finance, relationships,
technical competence, facilities) are required in order to
be able to compete? (Resources)?
• What external, environmental factors affect the
businesses' ability to compete? (Environment)?
• What are the values and expectations of those who have
power in and around the business? (stakeholders)
• Strategy at Different Levels of a Business
Strategies exist at several levels in any organization - ranging from
the overall business (or group of businesses) through to individuals
working in it.
• Corporate Strategy - is concerned with the overall purpose and
scope of the business to meet stakeholder expectations. This is a
crucial level since it is heavily influenced by investors in the
business and acts to guide strategic decision-making throughout the
business. Corporate strategy is often stated explicitly in a "mission
statement".
• Business Unit Strategy - is concerned more with how a business
competes successfully in a particular market. It concerns strategic
decisions about choice of products, meeting needs of customers,
gaining advantage over competitors, exploiting or creating new
opportunities etc.
• Operational Strategy - is concerned with how each part of the
business is organized to deliver the corporate and business-unit level
strategic direction. Operational strategy therefore focuses on issues
of resources, processes, people etc.
 Strategy versus Tactics
Strategy
• The annual business plan
specifies actions needed to
implement the strategy
• Strategy is the broad
approach to the achievement
of objectives
• It starts with the
identification and evaluation
of strategic objectives
• And then summarizes how
to fulfill the objectives
Tactics
• Tactics are designed for the
short term
• Tactics are the details within
the overall the strategy
• The details include what,
where and how activities
will take place to
accomplish a goal
• Strategic options can be analyzed by using Ansoff’s matrix and
Porter’s generic strategies
• Strategy is the process of planning & executing various maneuvers
or actions in an attempt to reach a goal. Strategy is often
associated with business, politics,& military planning, but
individuals can also strategized towards achieving their career,
health . Strategy is essentially akin to planning but implies a
maximization of resources with logical thinking, intelligence
(acquired knowledge) & leverage.
• Strategy is differentiated from tactics in that tactics are micro
strategies that contribute to large goal. Opening a successful
business would fall under strategy achieving financing or an
important client would be considered tactics towards strategy.
• A successful strategy begins with a goal , along with an analysis of
the current situation & then sets out a plan that address each
operational aspects needed to realize the achievement of the goal.
This generalized formula is characteristic of all straitening.
 7 P’s 7C’s
• Product • Customer value
• Promotions • Communications
• Price • Cost
• Place • Convenience
• People • Capable
• Process • Convergent
• Physical evidence • Conductive
 Issues for marketing strategy
• Product
What product do customers use now?
What benefits does consumer want from the product?
 
• Promotions
What promotions appeals would influence consumer to
purchase & use of our product?
What advertising claims would be effective for our
product?

• Pricing
How important is price to the consumer in various target
markets?
What effect will a price change have on purchase behavior?
• Place
Where do consumers buy this product?
Would a different distribution system change consumer
purchasing behavior?
• People
What type of people is desired by the consumer to
deliver the service? Would differentiation by people
help in gaining competitive advantage?
• Process
Would different procedure, mechanism, routine, and
helps in satisfying the customer needs?
• Physical Evidence
Can we have different physical evidence?
 Marketing Strategy
• Achieving objectives requires the marketer
engage in marketing decision-making which
indicates where resources (e.g., marketing
funds) will be directed. However, before
spending begins on individual marketing
decisions (e.g., where to advertise) the
marketer needs to establish a general plan of
action that summarizes what will be done to
reach the stated objectives.
• Tactical Programs – Marketing strategy sets the stage for
specific actions that will take place. Marketing tactics are
the day-to-day actions that marketers undertake and involve
the major marketing decision areas. As would be expected,
this is the key area of the Marketing Plan since it explains
exactly what will be done to reach the organization’s
objectives.
• Marketing Budget – Carrying out marketing tactics almost
always means that money must be spent. The marketing
budget lays out the spending requirements needed to carry
out marketing tactics. While the marketing department may
request a certain level of funding they feel is required, in the
end it is upper-management that will have final say on how
much financial support will be offered.
 Types of Marketing Strategy

• One of the most important concepts of the

marketing planning process is the need to
develop a cohesive marketing strategy that
guides tactical programs for the marketing
decision areas.
• In marketing there are two levels to strategy
formulation:
• General Marketing Strategies and
• Decision Area Strategies.
 General Marketing Strategies:

• These set the direction for all marketing efforts

by describing, in general terms, how marketing
will achieve its objectives.
• There are many different General Marketing
Strategies, though most can be viewed as
falling into one of the following categories:
  Market Expansion
• This strategy looks to grow overall sales in one of two ways:
– Grow Sales with Existing Products – With this approach the
marketer seeks to actively increase the overall sales of products
the company currently markets. This can be accomplished by: 1)
getting existing customers to buy more; 2) getting potential
customers to buy (i.e., those who have yet to buy); or 3) selling
current products in new markets.
– Grow Sales with New Products – With this approach the
marketer seeks to achieve objectives through the introduction of
new products. This can be accomplished by: 1) introducing
updated versions or refinements to existing products; 2)
introducing products that are extensions of current products; or
3) introducing new products not previously marketed.
• Market Share Growth – This strategy looks to
increase the marketer’s overall percentage or share of
market. In many cases this can only be accomplished
by taking sales away from competitors. Consequently,
this strategy often relies on aggressive marketing
tactics.
• Niche Market – This strategy looks to obtain a
commanding position within a certain segment of the
overall market. Usually the niche market is much
smaller in terms of total customers and sales volume
than the overall market. Ideally this strategy looks to
have the product viewed as being different from
companies targeting the larger market.
• Status Quo – This strategy looks to maintain
the marketer’s current position in the market,
such as maintaining the same level of market
share.
• Market Exit – This strategy looks to remove
the product from the organization’s product
mix. This can be accomplished by: 1) selling
the product to another organization, or 2)
eliminating the product.
 Decision Area Strategies

• These are used to achieve the General

Marketing Strategies by guiding the decisions
within important marketing areas (product,
pricing, distribution, promotion, target
marketing).
• For example, a General Marketing Strategy
that centers on entering a new market with
new products may be supported by Decision
Area Strategies that include:
• Target Market Strategy – employ segmenting
techniques
• Product Strategy – develop new product line
• Pricing Strategy – create price programs that offer
lower pricing versus competitors
• Distribution Strategy – use methods to gain access
to important distribution partners that service the
target market
• Promotion Strategy – create a plan that can
quickly build awareness of the product
• Achieving the Decision Area Strategies is
accomplished through the development of
detailed Tactical Programs for each area.
• For instance, to meet the Pricing Strategy that
lowers cost versus competitors’ products, the
marketer may employ such tactics as: quantity
discounts, trade-in allowances or sales volume
incentives to distributors.