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7/31/2019 Map Parvin Notes

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Marketing Strategy Drivers

PESTL

Political Stability Stable governments lead to rapid growth in Business

Economy Closed versus open Economy

Social Structure Variety or Homogeneity of society

Technology Available Advanced technology leads to better products

Legal Framework Can act as support or hindrance

Competition Good for customers, not so good for business

Marketing Strategy Drivers

Strategic Window

Derek F. Abell (1978) introduced the concept of Strategic Window

A Strategic Window is a period of time during which the strategy will work. Itis the relatively short time interval during which the fit between the factorscritical for success and competencies of the organization are in optimal state.

Any change in the Marketing Environmental factor/s can cause opening orclosing of Strategic Window.


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Formulation of Marketing Strategy

Genesis

Current state of Business

Projected or Expected state of Business

Formulation of Marketing Strategy

Genesis

Step 1: Detailed analysis of elements and operating conditions of business

Step 2: Identification of Strategic Window

Step 4: Strategic Planning to exploit the Strategic Window

Step 5: Implementation

Step 6: Continuous looking out for Strategic Window or work towardscreation of one.

Step 3: Checking its alignment with Mission


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Various Marketing Strategies BCG Matrix

Differentiation Tools Boston Consulting Group(BCG) Matrix Product Portfolio Method

Cash Cows

High Market Share

Low Business Growth

Low Investment Requirement

High Returns

Every companys Dream

Financial Foundation of Co.

Various Marketing Strategies

Differentiation Tools Boston ConsultingGroup (BCG) Matrix Continued.

Dogs

Low Market Share

Low Business Growth

Very High InvestmentRequirement

Very low Returns

Every companys Nightmare

Financial Drain for Co.


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Question Marks

Low Market Share

High Business Growth

High Investment Requirement

Can turn to a Star or a Dog

Companys new products

Risk Investment for Co.



Stars

High Market Share

High Business Growth

High Investment Requirement

Can turn to a Cash Cow

Companys growing products

Low Risk Investment for Co.


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Product Strategies

2.Ansoffs Matrix By Igor Ansoff of Harvard College, 1957

1. Market PenetrationStrategy

3. ProductDevelopment Strategy

2. Market DevelopmentStrategy

4. DiversificationStrategy

CurrentProducts

NewProducts

NewMarkets

CurrentMarkets


Strategies based on Market Share

Market Leader Has a larger market share and is successful. His strategiescreate proven track record for academics and followers to study and follow.

e.g. Colgate toothpaste

Challenger The one who innovates a strategy which challenges theestablished leaders existence.e.g. Close-up toothpaste

Follower The one who is satisfied in his own niche and doesnt take out ofWay risk to become challenger.e.g. Vicco Vajradanti


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Porters Generic Product Strategies

1. Overall Cost LeadershipAchieve lowest cost of production and distributionto kill competition by offering products at lowest price e.g. Wal-Mart

2. Differentiation By achieving superiority in an important customer benefitarea valued by masses e.g. Sony audio systems

3. Focus By focusing on only one of the business segments e.g. Bisleri60% Market share in packaged drinking water and 100% Growth in 2007


Alliance Strategies

McDonalds Coca-Cola (Product Alliance)

Pizza Hut Pepsi (Product Alliance)

A Hotel Rent-a-Car company (Service Alliance)

Hotels Corporate Houses (Service Alliance)

Small Banks ICICI Bank draft drawing arrangements (Service Alliance)

Credit Cards Discounts on products and services (Pricing Alliance)

OrganizationAd agency (Promotion Alliance)


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McKinsey 7-S Framework for Marketing Success

Strategy

Structure

System

Style

Staff

Skills

SharedValues

Strategy

Structure of Organization

SystemAutomation

Style Way of functioning

Staff Effective staff which can copeup with growth

Skills Required to perform

Shared values leading to mission


Strategies based on Innovation

Pioneer The one who is first in the business. Apple i-pod

Close Followers The ones who launch their brand in the market very soonafter the pioneer.

Late Follower The one who enters the market with a product which is longexisting in the market, usually at a cheaper price.


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Concept, Nature, and Scope of

Retailing What is Retailing?

Retailing includes all the activities in selling goods directly to the finalconsumer for personal (non-business) use. Kotler

Manufacturer Retailer Consumer

Manufacturer Wholesaler Retailer Consumer

Manufacturer Wholesaler Jobber Retailer Consumer

Manufacturer Distributor Wholesaler Jobber Retailer Consumer

Manufacturer Branch Distributor Wholesaler Jobber Retailer Consumer

Session 3 Learning Objective

Concept, Nature, and Scope of Retailing


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Concept, Nature, and Scope of

Retailing What is Retailing?

Retailing includes all the activities in selling goods directly to the finalconsumer for personal (non-business) use. Kotler

Manufacturer Retailer Consumer

Manufacturer Wholesaler Retailer Consumer

Manufacturer Wholesaler Jobber Retailer Consumer

Manufacturer Distributor Wholesaler Jobber Retailer Consumer

Manufacturer Branch Distributor Wholesaler Jobber Retailer Consumer

Significance of Retailingfrom Economy Point of View

Accounts for 15-20% work force

Second largest employment in India after agriculture

About 6 million Retail outlets of which 1.8 m in urban India

About 20% of urban outlets are into Services Retailing

Almost 70% are food or general stores category


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Significance of Retailing For manufacturer & Consumer

Direct contact with the customer

Bargaining power of Retailer due to huge selling capacity

(For e.g. Vijay Sales, Big Bazaar, Wal-Mart)

Point of revenue for manufacturer

For consumer its a combination of Services & Product Marketing

Functions of Retailer At a Glance

Functions of Retailer

ProvideGoods &Services Breaking

bulk intoSaleable

lots

GatherMktg Info

HoldInventory

Entertain& ProvideService toCustomers

UnderstandCustomers

Needs


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Interaction with end user

First point to register grievance / complaints

Suggestions are received

Other demographic info can be collected by observation

Understand Customers Needs

Providing goods & Services

Assortment of products Multiple brands under one roof

Large quantities are bought for effective rates and then it is broken intosmall quantities for customer convenience



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Provide credit facilities / Hire-purchase arrangements

Free home delivery and installation

After sales service

Helping customer to make decision

Product display for effecting sale

Entertain and Provide Services


On behalf of Manufacturer / Supplier

Act as a component of Marketing Information System forsupplier

Holding Inventory


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Challenges of Retailing

Emergence of India & China as new markets

The well-informed consumer

Technology enabled functioning those who have it and thosewho dont

Emergence of E-retailing

Retail Customer Profile in India

Urban Population in India 28% = 31 Crores = Total

Population of USA

40% Indian households earn Rs. 80,000 + per annum

Urbanization is rapidly growing UN estimate 90%Population of underdeveloped nations will be urbanized by2025


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Retail Customer Profile in India Continued..

Mumbai is more populated than NY, LA, Shanghai, Paris,

Moscow, London, Bangkok, Chicago and Hong Kong (NotCollectively)

Working women class is increasing

Nuclear Family

Trends in Retailing, Globally

Scattered profitable segments all over the world

Commoditization - where one offering is nearlyindistinguishable from another

Retailing in Exclusive segment / focused retailing

The fight to come to India or go to China

Rise of non-store retailers competing with store retailing


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Trends in Retailing in India

Grocery Beginning of Retailing [Hypercity, Big Bazaar]

Medicines Yet to come to India

Electronics [Vijay Sales, Hypercity]

Furniture [The Living Room, Hypercity]

Apparel [Shoppers Stop, Lifestyle]

Trends in Retailing, Globally Continued..

Challenge of differentiation in experience

Retailers becoming powerhouses of Marketing and exploit themanufacturers


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Trends in Retailing in India

Grocery Beginning of Retailing [Hypercity, Big Bazaar]

Medicines Yet to come to India

Electronics [Vijay Sales, Hypercity]

Furniture [The Living Room, Hypercity]

Apparel [Shoppers Stop, Lifestyle]

Trends in Retailing in India Continued..

Small store formats for quick buying [termed as PrecisionShopping]

Entertaining the customer

International Retailing So far only about 30 out of 250 USretailers have international presence


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Trends in Retailing in India Some unsung giant retailers

Canteen Stores Department 3,500 Canteen Stores operated

via 34 depots catering to 40 Lac households of in service andretired army, air force and navy personnel

Khadi & Village Industries 7,050 outlets all over India

Raymonds was one of the pioneering Indian Retailers

Factors behind success of Retail in India

Good economic growth rate (8+%)

Increasing Urbanization

Increasing Consumerism (e.g. Shopping Therapy)

Increased Brand consciousness

Software and BPO Boom

Increased Credit facilities

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