Overview and Strategy Blueprint

 One of the shortest definition of marketing is “creating

profitable customer relationships”

 Marketing is a process by which companies create

value for customers and capture value from customers
in return.
 Note 1: understanding the needs is vital to create
value.
 Note2: Delivering satisfaction is a key to make sure the
“profitable relationship” is sustainable.
Marketing is a process by which companies create
value for customers and build strong customer
relationships to capture value from customers in
return
• States of deprivation

Needs • Physical—food, clothing, warmth, safety

• Social—belonging and affection
• Individual—knowledge and self-expression

Wants • Form that human needs take as they are shaped by culture and
individual personality

Demands • Human wants backed by buying power

 Consumers prefer products that are
Production Concept widely available and inexpensive

Consumers favor products that

Product Concept offer the most quality, performance,
or innovative features

Consumers will buy products only if

Selling Concept the company aggressively
promotes/sells these products

Focuses on needs/ wants of target

Marketing Concept markets & delivering value
better than competitors
company should make marketing decisions
by considering consumers' wants, the
Societal Marketing Concept company's requirements, and society's long-
term interests.
 Integrated
Marketing

Internal Holistic Relationship

Marketing Marketing Marketing

Performance
Marketing
 Relationship Marketing signifies building mutually satisfying
long term relationships with key constituents that directly or
indirectly affect the success of a firm’s marketing activities.

 The Key constituents include: customers, employees,

marketing partners (suppliers & marketing intermediaries),
and members of the financial community ( banks and
shareholders).

 Research has indicated a correlation between relationship

marketing and profitability.
 Integrated Marketing signifies the formulation of a product
strategy, pricing strategy, channel strategy and
communications strategy in order to create, deliver, exchange
and communicate value for the consumers.
 In other words:
◦ the right product/service should be designed that provides a value which
satisfies a need.
◦ The right price should be set so that consumers will be ready to buy the
product while also making sure that the company makes profits.
◦ The right channels should be pursued so that consumers can access the
value.
◦ And an effective IMC campaign should be designed to communicate value
to the consumers.
 Internal Marketing signifies the alignment of every department
in the organization to be marketing oriented in order to achieve
marketing goals.

 A marketing manager will not be able to execute his/her

strategy effectively without the help of all the other
departments. Hence, there should be an inter-departmental
harmony in order to provide customer value.
 The marketing vice president of a major European airline
wants to increase the airline’s traffic share (goal). His strategy
(i.e. his game plan) is to build customer satisfaction by
providing better food, cleaner cabins, better trained cabin
crews, and lower fares, yet he has no authority in these
matters. The catering department chooses food that keeps
the food cost down; the maintenance department uses
inexpensive cleaning services; the HR department hires people
without regard to whether they are naturally friendly; the
finance department sets the fares.
 Class Discussion: relate the above story with internal
marketing, goals, and strategies.
 Performance Marketing signifies how well the business has
performed in terms of financial and non financial parameters.
 Discussion on the triple bottom line approach:

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 Goals indicate what a business unit wants to achieve;
strategy is the game plan for getting there.
 A manager comes up with a strategy or a plan of
action to achieve superior performance in the
marketplace than its competitors.
 You need to know your current and desired situation –
set your goals.
 You need a map – to understand the environment.
 You need a compass to give you directions – which
consumers are you going after?
 And finally you need to ACT (execution of your
strategy) – through the 4ps of marketing.
 The word ‘Strategy’ was initially introduced and defined in
the ancient military dictionaries

 It comes from the Greek word ‘strategos’, strictly meaning

a general in command of an army; it is formed from
‘stratos’, meaning army and ‘ag’, meaning to lead

 Used first time in business literature by William Newman

(1951)
Generic
 a plan of attack for winning
 a plan for beating the opposition

Organisational
 a plan for achieving organisational goals
 a plan for securing a competitive advantage in a given
market
 To set the future direction for the organisation

 To state how it is to create value to customers

 To identify what product/s and in which markets the

firm will invest its resources

 To describe how it is to perform better than

competition
 Corporate
Corporate Headquarters Strategy

Business
SBU SBU SBU (Division
Level)
Strategy
Manufacturing Finance Marketing Functional
R&D HRM Strategy

Strategic management may be initiated at any or all of these

hierarchical levels of an organisation

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 Corporate
The overall goals of the business; often
expressed in financial terms

Competitive/Business (SBU)
How to compete in individual product-
markets and support the corporate
strategy

Functional
Functional strategies for the
organisation’s functional areas in support
of SBUs and corporate strategies
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 “Marketing strategy is a market oriented game plan
which establishes a profitable & sustainable market
position for the firm against all forces that determine
industry competition by continuously creating &
developing a sustainable competitive advantage (SCA)
from the potential sources that exist in a firm’s value
chain.”

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 Strategy based upon the needs & wants of the
Market-oriented:
marketplace

Establishes a profitable End goal of strategy to make a profit in the for-profit

market position: sector or to meet alternate metrics (NFP sector)
Marketing strategy not about one-off transactions. Aim
Establishes a sustainable
is to find a place in the market and secure continuous
market position:
demand.
A strategy will outperform competitors and will make the
company thrive in an competitive environment
Forces that determine
comprising of: threat of substitutes, threat of new
industry competition:
entrants, bargaining power of suppliers, bargaining power
of buyers and industry competition.
signifies providing a benefit to the customers which
Continuously creating &
rivals cannot match: quicker delivery, innovative
developing SCA:
products, better customer service.
Potential sources that
What value any organisation wants to create using its
exist in a firm’s value
available internal resources in order to provide a SCA
chain:
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THINKING FIRST

SEEING FIRST
COMPETITIVE
MARKETING
STRATEGY
DOING FIRST

SIMPLE RULES

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 -Logical, sequential and linear
approach
 -It’s about analyzing a strategic
marketing problem and
developing the solution and
the strategy through a
carefully thought through and
largely sequential process
 -Instant views and decisions
are not made

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 It can help to see the
Cognitively analysing big picture occasionally
a strategic marketing throughout the
problem & developing process. It can involve
the solution (the some inspiration &
strategy) through a insight, but largely the
carefully thought-out process is one of
process painstakingly doing
your homework

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-Importance of
seeing the overall
decision is sometimes
greater than thinking
about it
-Insight often only
comes after a period
of preparation,
incubation,
illumination &
verification in the
cold light of day

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 (1) do something,
(2) make sense of it
(3) repeat the successful parts & discard the rest.

Instead of marketing strategy –

the reality is often that ‘doing’ drives

Many companies have successfully diversified

their businesses
by a process of figuring out what worked
& what did not

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 DO SOMETHING

MAKE SENSE OF IT

REPEAT THE SUCCESSFUL PARTS

DISCARD THE REST

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 -It’s about selecting a
few key marketing
strategic processes,
crafting a handful of
simple rules and
“jumping in” rather than
avoiding uncertainty
 -In many respects the
approach is related to
Doing First aside from
the main difference is
that the rules are
predefined

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How-to rules keeping managers organised to be able to seize opportunities

Boundary rules help managers to pick the best opportunities

based geography, customers or technology

Priority rules are about allocating resources amongst competing opportunities

Timing rules relate to the rhythm of key strategic processes

Exit rules are about pulling out from past opportunities

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 PROCESS
Experiential Cognitive

Short-Term

SIMPLE RULES SEEING FIRST

TEMPORALITY

DOING FIRST THINKING FIRST

Long-Term

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 Buyers are increasingly sophisticated and cynical about
regular marketing
 Customers prefer context specific persuasion knowledge
 According to Brown (2001)
◦ customers do not want the truth, the whole truth and
nothing but the truth
◦ They want marketing to be about glitz and glamour and to
be mischievous and mysterious.
◦ Marketing should be fun, but any nastiness is forbidden
◦ To undertake retro strategy (but in a manipulative way),
marketers need to practice TEASE

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 Thinking First Market Orientation works best when the
issues are clear, the data are reliable, the context is
structured, thoughts can be pinned down & discipline
can be applied
 Seeing First works best when many elements have to be
creatively applied, commitment to solutions is key &
communications across boundaries are needed
 Doing First or simple rules work best when the situation is
novel & confusing, complicated specifications would
get in the way & a few simple relationship rules can
help move the process forward
 The Postmodern orientation needs to be continually borne
in mind to provide a check on how, in reality, buyers
will interpret the final offering

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