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MARKETING 673

MARKETING 673. Spring Semester, 1999 Module 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”?

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MARKETING 673

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  1. MARKETING 673 Spring Semester, 1999 Module 1

  2. OUTLINE • Marketing Strategy: An Overview • Developing Marketing Strategy • Competitive Advantage

  3. STRATEGY • What is “strategy”? • ...the fundamental means or scheme for reaching objectives.

  4. MARKETING STRATEGY • What is “marketing strategy”? • ...the selection of target markets and the creation and maintenance of an appropriate marketing mix.

  5. DEVELOPING A MARKETING STRATEGY • SWOT Analysis • Mission Statement / Goals and Objectives • Marketing Strategy

  6. SWOT • Strengths • Weaknesses • Opportunities • Threats • Also called a “Situational Analysis”

  7. 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)

  8. STRENGTHS AND WEAKNESSES • Sample Attributes to be Examined: • Organizational Structure • Managerial Expertise • Training Programs • Cash Flow • Distribution Networks • See Exhibit 7.1 (page 156)

  9. OPPORTUNITIES AND THREATS • Opportunities and Threats are derived from an analysis of the environment external to the firm • Competitive Environment • Macro Environment

  10. 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.

  11. COMPETITIVE ENVIRONMENT--Major Competitors • Competitor’s Objectives • Competitor’s Strategy • Competitor’s Success to Date • Competitor’s Strengths/Weaknesses • Competitor’s Future Behavior

  12. COMPETITIVE ENVIRONMENT--Industry Structure • Industry structure concerns a review of the dynamics within a particular industry.

  13. 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

  14. PHYSICAL ENVIRONMENT • Special conditions can create opportunities • Depletion/degradation of resources also creates opportunity

  15. POLITICAL/LEGAL ENVIRONMENT • Includes all factors controlled by public authorities • Vary from country to country • Most important question is POLITICAL STABILITY when marketing abroad

  16. POLITICAL/LEGAL ENVIRONMENT • Political risk to foreign firms • Confiscation • Domestication • Import Restrictions • Taxes • Price Controls

  17. POLITICAL/LEGAL ENVIRONMENT • Governments encourage foreign investment through: • tax concessions • relaxation of tariffs • streamlining policies and procedures • government deregulation

  18. TECHNOLOGICAL ENVIRONMENT • Impact on: • New product development • Existing industries • Other marketing operations such as communications, distribution, and marketing research

  19. 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

  20. 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

  21. TODAY’S MARKETING ENVIRONMENT

  22. 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!!

  23. DEVELOPING A MARKETING STRATEGY • SWOT Analysis • Mission Statement / Goals and Objectives • Marketing Strategy

  24. 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”

  25. FROM THE INTERNET • Mission Statements = Profits <http://www.smartbiz.com/sbs/arts/ hph4.htm>

  26. 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

  27. 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

  28. DEVELOPING A MARKETING STRATEGY • SWOT Analysis • Mission Statement / Goals and Objectives • Marketing Strategy

  29. 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.

  30. 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

  31. 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

  32. TYPES OF MARKETING PLANS • New Product Plans • Annual Marketing Plans (for existing products)

  33. 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

  34. The key to a successful strategy….. COMPETITIVE ADVANTAGE

  35. 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!

  36. CHARACTERISTICS • They must be real • They must be important to the client • They must be specific • They must be promotable

  37. ELEMENTS OF COMPETITIVE ADVANTAGE

  38. SOURCES OF ADVANTAGE • Skills • people, operational capabilities • Resources • strong distribution networks, marketing power • Controls • feedback mechanisms

  39. 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

  40. PERFORMANCE OUTCOMES • Satisfaction • Loyalty • Market Share • Profitability

  41. ASSESSING COMPETITIVE ADVANTAGE • Portfolio Analysis • BCG Matrix • GE / Industry Attractiveness-Business Position Matrix

  42. PORTFOLIO ANALYSIS • It combines the assessment of business position and market attractiveness. • It enables managers to classify and review current and prospective SBU’s

  43. THE BCG MATRIX • Growth • Market Share

  44. 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

  45. 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

  46. 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”

  47. INDUSTRY ATTRACTIVENESS MATRIX • Market Attractiveness • Business Position

  48. STRATEGIC IMPLICATIONS • Invest / Grow • Selective Investment • Harvest / Divest

  49. FROM YOUR TEXT... • Chapter One (Pages 1-18) • Chapter Two (Pages 21-40) • Chapter Six (Pages 123-151) • Chapter Ten (Pages 238-258)

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