MARKETING STRATEGY

CHAPTER TWO
 LEARNING OUTCOMES:

 Defining Strategic Planning

 Designing the business portfolio
 Managing the market effort.
 Explaining the marketing strategy and marketing mix.
Strategic Planning

 Definition: The process of developing and maintaining a strategic fit

between the organization’s goals and capabilities and its changing
marketing opportunities.
 Steps in Strategic Planning

Corporate Level Corporate Level

Business Unit, Product
Corporate Level
and Market Level

1 2 3 4

2 4
1 Setting 3
Defining the company Designing the Planning
company objectives business marketing and
mission and goals portfolio other functional
. strategies

IDEA www.yourwebsite.com
Defining a market-oriented mission

 Mission statement. A statement of the organization’s purpose-what

it wants to accomplish in the larger environment.
 What is our business?
 Who is the customer?
 What do consumers value?
 What should our business be?
 Mission statements should be market oriented.
 Example of market-oriented business
definitions:
Company Product-Oriented Definition
Amazon.com We sell books, videos, CDs, toys,
consumer electronics,
hardware, housewares, and
other products.
Disney We run theme parks.
Wal-Mart We run discount stores.
Market-Oriented Definition
We make the internet buying
experience fast, easy, and
enjoyable-we’re the place
where you can find and
discover anything you want to
buy online.
We create fantasies- a
place where America still
works the way it’s supposed
to.
We deliver low prices every
day and give ordinary folks
the chance to buy the
same things as rich people.
Setting company objectives and goals
 The company need to turn its mission into detailed supporting objectives.
 Marketing strategies and programs must be developed to support these marketing
objectives.
 Example of Monsanto company;

Mission:
“Improving the future farming and improving the future for food abundantly and safely”.

Objectives:
To build profitable customer relationship by developing better agricultural products.
To distribute the agricultural products to market faster at lower costs.

Marketing Strategy:
Increase the product availability and promotion.
Cut the prices and target large farms abroad.
Designing the business portfolio

 Definition:
 Business portfolio. The collection of businesses and products that
make up the company.
 Portfolio analysis. The process by which management evaluates
the products and businesses making up the company.
Cont.,

 Analyzing the current business portfolio using BCG (Boston Consultancy

Group) growth share matrix model.
Cash cows is where company has high
market share in a slow-growing industry.

Dogs, are units with low market share in a

mature, slow-growing industry.

Question marks (also known as problem

children) are business operating in a high
market growth but having a low market
share.
$
Stars are units with a high market share in
a fast-growing industry.
Cont.,

 Developing strategies for growth and downsizing using Ansoff Matrix

(product/market expansion grid)
 Product/market expansion grid is a tool for identifying company growth opportunities
through market penetration, market development, product development, or
diversification
Marketing Strategy and the Marketing Mix
Cont.,

Market segmentation is the division of a market into

distinct groups of buyers who have distinct needs,
characteristics, or behavior and who might require
separate products or marketing mixes
Market segment is a group of consumers who respond in a
similar way to a given set of marketing efforts
Cont.,

 Market targeting is the process of evaluating each

market segment’s attractiveness and selecting one or
more segments to enter
Cont.,

 Market positioning is the arranging for a product to occupy

a clear, distinctive, and desirable place relative to
competing products in the minds of the target consumer.
 Positioning aims to help customers know the real
differences between competing producers’ products, so
that they can match themselves to other producers’
products that can be of most value to them.
Seven positioning bases:

i. Product attributes
ex – product characteristic, national creation, economical
buy and durability.
ii. Benefit offer – What is the product’s benefit compare to
competitors ex- reduces cavity, double your saving, etc.
iii. Usage or application –what is the specific purpose and
usage. Ex- lotion for baby skin and also useful for adult use.
iv. Competitor – positioned directly against a competitor. Ex
Mydin – selling at wholesaler price compare to Giant.
Cont.,

v) Price and quality – Ex Sony is well known for quality

sound and picture for its audio equipment and
televisions. Kamdar successfully adopted the ‘low
price and value strategy’ making them popular
among Malaysian consumers.
vi) Product user – positioned its product based on the
type of user’s personality. ex- Anlene Gold is specialty
formulated for adults above 51 years.
vii) Product class – position its product as being
associated with a particular category of products. Ex –
Dorina light margarine is as good as butter but has a
low cholesterol.
Elements of a “Great” Positioning
 Company  Customer
 Fit with company  Credible/Reliable
strategy  Relevant
 Fit with company
 Unique
capabilities
 Durable
 Fit with corporate
culture  Emotionally
appealing
 Fit with product
strategy
 Fit with physical  Context
product  Fit
with trends
 Fit with brand
 Unique vs.
personality / brand Competition
essence
If you want your
products/services to be different
then you’ve got to do different!

“If we do things like we did before, we

probably are going to get results
like we did!”
Cont.,

 We should remember that in an established

segment, competitors have already operated and
taken a position, so we must make a research on
competitors' position and decide whether to take
the same position similar with them or go after the
whole market.
 Two choices can be made – build a superior
product and fight for a market share or developed
a product that is not currently offered to the
market.
Developing an Integrated Marketing Mix

 Marketing mix is the set of controllable tactical

marketing tools—product, price, place, and
promotion—that the firm blends to produce the
response it wants in the target market
Developing an Integrated Marketing Mix
Planning marketing: Partnering to build
customer relationships

 Partnering with other company departments. Focusing to the value

chain where each department carries out value-creating activities
to design, produce, market, deliver and support the firm’s
products.

Partnering with others in the marketing system. The firm needs to look
beyond its own value chain and into the value chains of its suppliers,
distributors, and ultimately, customers.
Managing the marketing effort

 Marketing analysis. A complete analysis of the company’s situation.

 Managing the marketing effort will requires the four-marketing
management function such as analysis, planning, implementation, and
control.
 Marketing planning. Marketing planning involves deciding on marketing
strategies that will help the company attain its overall strategic objectives.
A marketing strategy consists of specific strategies for target market,
positioning, marketing mix, and marketing expenditure.
 Marketing implementation. The process that turns marketing strategies and
plans into marketing actions in order to accomplish strategic marketing
objectives.
Cont.,

 Marketing department organization. Marketing department will carry out

marketing strategies and plans.
 Marketing control. The process of measuring and evaluating the results of
marketing strategies and plans and taking corrective action to ensure that
objectives are achieved. The most famous tool used is marketing audit
which is a comprehensive, systematic, independent and periodic
examination of a company’s environment, objectives, strategies, and
activities to determine problem and opportunities.
 Conclusion

 In the previous chapter, the definition of marketing and the outlined in the
marketing process was discussed. This chapter examined companywide
strategic planning and marketing’s role in the organization. It also focus on
the marketing strategy and the marketing mix and reviewed the marketing
management functions.