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What is market Driven strategy?

Market Driven Strategy

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Characteristics of Market-Driven Strategies

Becoming market oriented

Achieving superior performance

Determining distinctive capabilities

Matching customer value req. to capabilities

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Market Orientation
A business is market-oriented when its culture is systematically and entirely committed to the continuous creation of superior value for the customers

Becoming market oriented requires the involvement of

Entire set of skills, infrastructure, processes and resources to Continuously monitor the changing needs of the customers. Determine The impact of competitive forces Implement Strategies that safeguard the corporate image

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Characteristics of Market-Orientation
Customer Focus:
Marketing is managing profitable customer relationships. Goals: Attracting or retaining customer by promising superior value and harness the relationship through continuous satisfaction. Market Orientation is simply not a philosophy but a process of deploying skills and resources systematically to achieve the marketing concept. Example: Del Inc.s

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Competitor Intelligence
Superior value requires that the company should identify and understand the principal competitor's short term strengths and weaknesses and long-term capabilities and strategies. E.g:- Polaroid

Cross Functional Co-ordination

All business functions must perform together for a common goal; superior value. Performances implications
Companies that are market oriented shows favorable organizational performance.

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2. Distinctive Capabilities

Capabilities are complex bundles of skills and accumulated knowledge, exercised through organizational processes, that enable firms to coordinate activities and make use of their assets.
Distinctive Capabilities capabilities must make you stand out. They should be superior to the competition and difficult to duplicate.

Something that you are good at. Sources of

HP ink jet printer technology Wal-Mart: information & logistic system Del: direct sale, built-to-order-design

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Components of Distinctive Capabilities ( southwest Airlines)

Skills and accumulated knowledge

Co-ordination of Activities

Assets Organizational process

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 Types of Capabilities and Business Structures

Outside-In Processes
Connects the organization to its external environment Relationships with stakeholders Feedback

Inside-Out Processes
Activities necessary to connect to the customers. Satisfy value requirements

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EXTERNAL EMPHASIS
Outside-in processes

INTERNAL EMPHASIS
Inside-out processes Spanning processes Customer order fulfillment Pricing Purchasing CSD New product/service development Strategy development Financial management Cost control Technology development Integrated logistics Manufacturing/transforma tion processes HRM Environmental health and safety

Market sensing Customer linking Channel bonding Technology monitoring

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3. Matching customer value requirements to capabilities CV= B -C

the customer evaluation of the differences between all the benefits and all the costs of a marketing offering relative to those of the competition. benefits should match or outweigh the costs! Costs:
Monetary Costs Time and physical energy Psychic Cost (risk and opportunity costs)

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3. What is customer value?

Its all about perceived value
can the customer see differences between two products in terms of value? the perceived value can emanate from product/brand/service or the price

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Delivering the value

Offer benefits and solutions and not product features

How to deliver the value? keep your promise

Analyzing customer needs at all times Improving product performance and service excellence Achieving operational excellence and synergy

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The focus of strategic marketing is on organizational performance rather than on simply increasing sales
It is a process of combining the customerinfluencing strategies of the business into a coordinated set of market-driven actions as well as link it with the external environment to create and deliver value!

Marketing is now seen as a central to business strategy planning process and not a function alone!
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Situation Analysis Designing Marketing Strategy

Marketing Program Development

Implementing and Managing Marketing Strategy

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Situation Analysis

Markets need to be defined

Demand estimation and forecasting Analyze and predict consumer behavior Analyze and predict competitors behavior

There must be sizeable number of people Must have purchasing power

Designing Market Driven Strategies

Segment, Target and Position Building strong relationships with suppliers and customers Choice of marketing mix elements

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Market-focused Program Development

Product portfolio and Strategic Brand Management

Decide to invest or divest in products and services Entering into similar or dissimilar product categories

Value chain, price and promotion strategies

Implementing and Managing Market-Driven Strategy

Preparing the marketing plan and budget Implementing the plan using the tools to gauge the performance of the plan
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THANK YOU

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