Download - MARKETING 673
MARKETING 673
Spring Semester, 1999Module 1
OUTLINE
Marketing Strategy: An Overview Developing Marketing Strategy Competitive Advantage
STRATEGY What is “strategy”?
- ...the fundamental means or scheme for reaching objectives.
MARKETING STRATEGY What is “marketing strategy”?
- ...the selection of target markets and the creation and maintenance of an appropriate marketing mix.
DEVELOPING A MARKETING STRATEGY
SWOT Analysis Mission Statement / Goals and
Objectives Marketing Strategy
SWOT Strengths Weaknesses Opportunities Threats Also called a “Situational Analysis”
STRENGTHS AND WEAKNESSES
Strengths and Weaknesses focus on the internal (corporate) environment
Strengths: Competitive advantages that a company can exert in the marketplace (Text, pg. 154)
Weaknesses: Constraints that hinder movements in certain directions (Text, pg. 154)
STRENGTHS AND WEAKNESSES
Sample Attributes to be Examined:- Organizational Structure- Managerial Expertise- Training Programs- Cash Flow- Distribution Networks- See Exhibit 7.1 (page 156)
OPPORTUNITIES AND THREATS
Opportunities and Threats are derived from an analysis of the environment external to the firm- Competitive Environment- Macro Environment
COMPETITIVE ENVIRONMENT
The competitive environment consists of an analysis of major competitors, their plans, products, and suppliers as well as an analysis of the industry structure.
COMPETITIVE ENVIRONMENT--Major
Competitors Competitor’s Objectives Competitor’s Strategy Competitor’s Success to Date Competitor’s Strengths/Weaknesses Competitor’s Future Behavior
COMPETITIVE ENVIRONMENT--Industry
Structure Industry structure concerns a review
of the dynamics within a particular industry.
MACRO ENVIRONMENT The macro environment concerns all
other factors over which the marketer has no or little control- Physical- Political/Legal- Technological- Sociocultural- Demographic/Economic
PHYSICAL ENVIRONMENT Special conditions can create
opportunities Depletion/degradation of resources
also creates opportunity
POLITICAL/LEGAL ENVIRONMENT
Includes all factors controlled by public authorities
Vary from country to country Most important question is
POLITICAL STABILITY when marketing abroad
POLITICAL/LEGAL ENVIRONMENT
Political risk to foreign firms- Confiscation- Domestication- Import Restrictions- Taxes- Price Controls
POLITICAL/LEGAL ENVIRONMENT
Governments encourage foreign investment through:- tax concessions- relaxation of tariffs- streamlining policies and procedures- government deregulation
TECHNOLOGICAL ENVIRONMENT
Impact on:- New product development- Existing industries - Other marketing operations such as
communications, distribution, and marketing research
SOCIOCULTURAL ENVIRONMENT
...represents the values, attitudes, and general behavior of individuals in a given society
slow to change Changes in individual values and
shifts in family structure have impacted US markets
DEMOGRAPHIC/ECONOMIC ENVIRONMENT
In uncertain times, variables most likely to impact marketing strategies are:- population demographics- rate of economic growth- interest rates and currency exchange
rates
TODAY’S MARKETING ENVIRONMENT
TODAY’S MARKETING ENVIRONMENT
Mass markets to market segments Changing demographics Internationalization of marketing Expanding role of government Increasing pace of change Focus on the environment Focus on the customer The internet!!
DEVELOPING A MARKETING STRATEGY
SWOT Analysis Mission Statement / Goals and
Objectives Marketing Strategy
MISSION STATEMENT Mission Statement (Text, Page 177)
- “The conception of the organization’s raison d’être, or what it should work toward, in light of long range opportunity”
FROM THE INTERNET Mission Statements = Profits
<http://www.smartbiz.com/sbs/arts/ hph4.htm>
GOALS AND OBJECTIVES Goals: long-range purpose that is
not necessarily quantified or limited to a time period
Objectives: flow from goals, they are measurable and deemed to be attainable at some future date through planned actions
SLU’s MISSION, GOALS AND OBJECTIVES
Mission: http://www.selu.edu/Administration/ Inst-Research/Planning/vision.htm
Goals and Objectives: http://www.selu.edu/Administration/ Inst-Research/Planning/goals.htm
DEVELOPING A MARKETING STRATEGY
SWOT Analysis Mission Statement / Goals and
Objectives Marketing Strategy
THE MARKETING PLAN Your marketing strategy!! …a written document containing the
guidelines for the business unit’s marketing programs and allocations over the planning period.
THE MARKETING PLAN ACTIVITIES: It outlines tasks and
timing of activities PEOPLE: It informs participants of
their role and function RESOURCES: It specifies how
resources are to be allocated
A MARKETING PLAN WILL... act as a road map help in the prediction of problems,
opportunities, and threats assist in helping to obtain resources
for implementation stimulate thinking and better use of
resources
TYPES OF MARKETING PLANS
New Product Plans Annual Marketing Plans (for existing
products)
THE MARKETING PLAN Title Page and Table of Contents Executive Summary Situational Analysis Target Market(s) Goals/Objectives Marketing Strategy Implementation and Control Summary/Conclusion Appendices
The key to a successful strategy…..
COMPETITIVE ADVANTAGE
COMPETITIVE ADVANTAGE “Superior or favorable difference from
competitors along some dimension important to the market” (Zikmund & d’Amico, 1997)
...a firm has a marketing mix that the target market sees as better than a competitor’s mix
Without competitive advantage(s), you do not succeed!
CHARACTERISTICS They must be real They must be important to the client They must be specific They must be promotable
ELEMENTS OF COMPETITIVE ADVANTAGE
PERFORMANCE OUTCO MES
P O S IT IO N A L A D V A N T A G ES
S O U R C E S O F A D V A N TA G E
SOURCES OF ADVANTAGE Skills
- people, operational capabilities Resources
- strong distribution networks, marketing power
Controls- feedback mechanisms
POSITIONAL ADVANTAGES Positioning: “placing a brand in that
part of the market where it will receive a favorable reception compared to competing products” (Text, page 345)
Low Cost Superior Customer Value
PERFORMANCE OUTCOMES
Satisfaction Loyalty Market Share Profitability
ASSESSING COMPETITIVE ADVANTAGE
Portfolio Analysis- BCG Matrix- GE / Industry Attractiveness-Business
Position Matrix
PORTFOLIO ANALYSIS It combines the assessment of
business position and market attractiveness.
It enables managers to classify and review current and prospective SBU’s
THE BCG MATRIX Growth Market Share
BCG MATRIX
Growth is used because it is an approximation of the PLC
Market Share is the ratio of the firm’s market share to the market share of its largest competitor
BCG MATRIX Stars
- Hi Growth/Hi Market Share Cash Cows
- Lo Growth/Hi Market Share Dogs
- Lo Growth/Lo Market Share Question Marks / Problem Children
- Hi Growth/Lo Market Share
STRATEGIC IMPLICATIONS Divest dogs or pursue a “focus”
segmentation policy Use cash from cash cows to fund
other operations Manage stars to maintain market share Try to move “Question Marks” to
“Stars”
INDUSTRY ATTRACTIVENESS MATRIX
Market Attractiveness Business Position
STRATEGIC IMPLICATIONS Invest / Grow Selective Investment Harvest / Divest
FROM YOUR TEXT... Chapter One (Pages 1-18) Chapter Two (Pages 21-40) Chapter Six (Pages 123-151) Chapter Ten (Pages 238-258)