Chapter 6: Marketing strategy

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Chapter 6: Strategic Marketing
Objectives

1. Describe the strategic marketing planning process and the

three key phases involved in shaping marketing strategy
2. Undertake strategic market analysis using SWOT analysis
3. Formulate strategic marketing goals
4. Understand how to implement strategic market action
5. Identify what marketing metrics to use to monitor and
control strategy implementation
6. Write a strategic marketing plan
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6.1 The Strategic Context

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 The Strategic Context

Resources
and Competitors
capabilities

The external Target

environment customers
6.2 Strategic Marketing Planning

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 Vision
= Statement about what an organization wants to become.

Should give shape and direction to an organization’s future.

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Mission

Purpose of the company

Answer to basic questions:
• What business are we in?
• Who are our customers?
• What are we in business for?
• What sort of business are we?

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Vision and Mission: Example
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Good mission statements
 Realistic
 Realistic goals
 Limited number of goals
 Specific
 Fit your company and no other
 Not too broad, not too vague
 Based on unique, distinctive competence
 What do we want to excel at?
 How do we differentiate ourselves from competitors?

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Good mission statements (2)
 Motivating
 Something to believe in
 Important work or positive contribution to others

 MARKET ORIENTED!

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Product vs. market orientation
Company Product oriented Market oriented
Missouri-Pacific Railroad Run a railroad We are a people-and-goods mover

Xerox We make copying equipment To help people find better ways to do

great work; improve our customers'
work processes and business results.

BP Sell gasoline Our products and services

contribute to a better quality of life.
They provide the freedom to move,
to heat and to see.

Run auction site We provide a global trading

platform where practically anyone
can trade practically anything
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Importance of the mission
Start with why

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Mission: example (2)
Organizational values

Acceptable interpersonal and operating standards of behaviour. Shape

organizational culture.

Govern and guide the behaviour of individuals within the

organization.

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Organizational goals

The desired outcomes of the organization’s various

activities. These may be articulated in terms of
profit, market share, share value, return on
investment or numbers of customers served.

Short-term or long-term

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 Corporate strategy
= The means by which the resources of the organization are matched with
the needs of the environment in which the organization decides to
operate.

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Linking Marketing and Corporate Strategies
6.3 Process and Activities

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Process

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Strategic Market Analysis

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Example

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‘Five Forces’ Model

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 SWOT analysis
Strengths Weaknesses

Opportunities Threats

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 Strengths and weaknesses
Strengths and weaknesses relate to the internal resources and capabilities
of the organization, as perceived by customers (Piercy, 2002):

■ A strength is something an organization is good at doing, or something

that gives it particular credibility and market advantage.

■ A weakness is something an organization lacks or performs in an inferior

way in comparison with others.

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 Opportunities and threats
Opportunities and threats are externally oriented issues that can
potentially influence the performance of an organization or offering.
Information about these elements is generated through PESTLE analysis:

■ An opportunity is the potential to advance the organization by

developing and satisfying an unfulfilled market need.

■ A threat is something that, at some time in the future, may destabilize

and/or reduce the potential performance of the organization.

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Example: SWOT Analysis

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Strategic Marketing Goals

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Example: Zalando

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Using Ansoff’s Matrix to Derive Growth Strategies

Figure 5.6 Ansoff’s Matrix

Source: Adapted from Ansoff (1957)
Example: Ben & Jerry’s

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6.4 Strategic Market Action

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Strategic market action

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Competitive Advantage
= The prolonged benefit of implementing some unique value-creating
strategy not simultaneously being implemented by any current or
potential competitors

along with the inability to duplicate the benefits of this strategy

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Step 1: Identify competitors

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Step 2: Competitive Analysis
Generic strategies (Porter)

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 Value disciplines
BEST PRODUCT
Continuous innovation & creativity
New products to market quickly

BEST TOTAL SOLUTION

Leading in price and convenience Constantly tailor offering to needs of
Reduce costs and create efficient value- target customers based on
delivery system knowledge of individual customer
BEST TOTAL COST
Source: Treacy & Wiersema
 Generic strategies: Examples
Industry Operational Product Customer
excellence leadership intimacy
Airlines Ryanair, EasyJet Emirates Singapore
Airlines
Groceries Aldi, Lidl Specialty stores Delhaize, Albert
Heijn
Cars Toyota, Kia Mercedes, Lexus, Jaguar,
Lotus Land Rover
Computers Dell Apple Dell
Competitive positioning

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 Market leaders
Single largest share of the market

Prime strategies:
Attack the market: Create new uses and/or users; increase frequency of
use

Defend the position: Regular innovation; larger ranges; price cutting and
discounts; increased promotion

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 Market challengers
Aspire to the leadership position

Prime strategies:
Attack the market leader: pricing; new product attributes; sharp increase
in advertising spend

Attack rivals: special offers and limited editions; superior competitive

advantages

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Market challenger: Example
 Market followers
Low market share, no threat to the market leader

Prime strategies:
Avoid hostile attacks on rivals
Copy the market leader and provide good-quality products that are well
differentiated
Focus on differentiation and profits, not market share

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 Market nichers
Specialists, small segments

Prime strategies:
Provide high level of specialization: geography; proposition; service;
customer group

Provide tight fit between market needs and the organization’s resources

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Cooperating

Consider how customer value might be developed

through cooperation instead of competition

“Co-opetition”— cooperating with a competitor to

achieve a common goal or get ahead

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 Platform Strategies
Conventional strategy: Linear value chain approach, which considers
successive supplier/distributor participants to add value as a product moves
along a chain to be consumed by end users

A platform is a business model that creates value by facilitating exchanges

between two or more interdependent groups, usually consumers and
producers.
The platform does not own the means of production, but rather creates the
means of connection. The strength of the platform economy lies in its ability
to eliminate trade barriers by using increased information sharing between
different players and circulation of data to its advantage.
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6.5 Strategic Marketing Implementation

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 Implementing Marketing Plans
The implementation of a marketing strategy is influenced by:

Major elements that can impact the strategy implementation process

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 Marketing metrics
= controls used to measure the effectiveness of the strategy
implementation process

A key performance indicator (KPI) is a measurable value that

demonstrates how effectively a company is achieving key business
objectives

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Key marketing performance metrics

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Customer advocacy; Net Promoter Score

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6.6 Writing the Marketing Plan

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 Elements of a marketing plan
• Executive summary
• Overall objectives (Mission)
• Product/Market background
• Marketing analysis
• Marketing strategies
• Marketing goals
• Marketing programmes
• Implementation
• Supporting documentation
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