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Market-Oriented
Perspectives
Underlie Successful
Corporate,
Business, and
Marketing
Strategies McGraw-Hill/Irwin
©2008 The McGraw-Hill Companies,
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All Rights Reserved
What is a strategy?

A strategy is a fundamental pattern

of present and planned objectives,
resource deployments, and
interactions of an organization with
markets, competitors, and other
environmental factors

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Components of Strategy

 Scope
 Goals and objectives
 Resource deployments
 Identification of sustainable
competitive advantage
 Synergy

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The Hierarchy of Strategies

 Three major levels of strategy are:

‡ Corporate strategy
 Business-level strategy
 Marketing strategy

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Market-Oriented Management

 Follows a business philosophy

commonly called marketing concept
 Consistent focus by personnel in all
departments and at all levels
 Adopts a variety of organizational
procedures and structures:
 To improve the responsiveness of
decision making

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Exhibit 1.5

Guidelines for Market-Oriented

Management
 Create customer focus throughout the
business
 Listen to the customer
 Define and nurture your distinctive
competence
 Define marketing as market intelligence
 Target customers precisely
 Manage for profitability, not sales volume
 Make customer value the guiding star
 Let the customer define quality
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Exhibit 1.5

Guidelines for Market-Oriented

Management (continued)
 Measure and manage customer
expectations
 Build customer relationships and loyalty
 Define the business as a service business
 Commit to continuous improvement and
innovation
 Manage culture along with strategy and
structure
 Grow with partners and alliances
 Destroy marketing bureaucracy

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Factors that Mediate Marketing’s
Strategic Role
 Competitive factors affect a firm’s market
orientation
 Influence of different development stages
across industries and global markets
 Strategic inertia

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Exhibit 1.7

Differences between Production-Oriented

and Market-Oriented Organizations
Business Activity Production Marketing
or Function Orientation Orientation
Company sells what Company makes
Product offering
it can make what it can sell
Product line Narrow Broad
Based on Based on
Pricing production and perceived benefits
distribution costs provided
Focus on
Focus on product identifying new
improvement and opportunities and
Research cost cutting in applying new
the production technology to
process satisfy
customer needs
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Exhibit 1.7

Differences between Production-Oriented

and Market-Oriented Organizations
(continued)
Business Production Marketing
Activity or Orientation Orientation
Function
Packaging Protection for the Designed for
product; customer
minimize costs convenience; a
promotional tool
Credit A necessary evil; A customer service;
minimize bad debt a tool to attract
losses customers
Promotion Emphasis on Emphasis on
product features, product benefits and
quality, and price ability to satisfy
customers’ needs or
solve problems
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Recent Developments Affecting
the Strategic Role of Marketing
 Globalization
 Increased importance of service
 Information technology
 Relationships across functions and firms

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 Exhibit 1.8

Categories of E-Commerce
  Business Consumer
Business-to-Business Business-to-Consumer (B2C)
(B2B)
Business Examples: Examples:
• Purchasing sites of • E-tailers, such as E*Trade,
Ford, Oracle, Cisco Amazon, iTunes
• Supply chain networks • Producers’ direct sales sites, such
linking producers as Dell, Ryanair, Safital Hotels
anddistribution channel • Web sites of traditional retailers,
members, such as 3M such as
and Wal-Mart Sears, Lands’ End, Marks &
Spencer
  Consumer-to-Business Consumer-to-Consumer (C2C)
(C2B)
Consumer Examples: Examples:
• Sites that enable • Auction sites, such as eBay, QXL
consumers to bid on • Blogs praising /criticizing
unsoldairline tickets and companies or
other goods and services, brands
such as Priceline
Source: Adapted from “A Survey of E-Commerce: Shopping Around the Web, The Economist, February 26, 2000, p. 11.
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Formulating and Implementing
Marketing Strategy Process
 Decision-Making Focus
 Analysis of the four “Cs”
 Integrating firm's marketing strategy
with other strategies and resources
 Market opportunity analysis
 Understanding Market Opportunities
 Measuring Market Opportunities
 Market Segmentation, Targeting, and
Positioning Decisions

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Formulating and Implementing
Marketing Strategy Process
(Continued)
 Formulating strategies for specific
market situations
 Implementation and control

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The Marketing Plan—A Blueprint
for Action
 A marketing plan is a written
document detailing the current situation
with respect to customers, competitors,
and the external environment

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Exhibit 1.10

Contents of a Marketing Plan

 Executive summary
 Current situation and trends
 Performance review
 Key issues
 Objectives
 Marketing strategy
 Action plans
 Projected profit-and-loss statement
 Controls
 Contingency plans
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