What is a Strategy

A Strategy is the Science and Art of assessing your situation

Setting goals andUsing the available resources to Accomplish these goals.

Strategic Marketing

“Marketing Strategy is a series of integrated actions

leading to a sustainable competitive advantage.”

Effective Strategic Marketing

Strategic Marketing Process Requires a Unique Marketing Plan for each of the Strategic Business Units.

Market Analysis Competitive Analysis Product Life Cycle Analysis

Key Elements of Marketing Strategy Formulation

The strategic 3 Cs Customers Competitors Competencies

AND  Strategic Marketing DecisionsWhere to competeHow to competeWhen to compete

Paradigm of Strategic Marketing Process

CUSTOMERS

Relationship Marketing

Solution selling

Business process integration

COMPETITION

1. Developing appropriate marketing mix

2. A careful analysis of each stage of the product life stage and taking appropriate decisions for each situation

COMPETITION….

3. Carving a market niche whereas the company feels competitively and strategically stronger.

4. By appropriately segmenting the market and selecting and serving the most appropriate segment.

5. Deciding for acquisition, merger, diversification or collaborations in order to make the company stronger and more competitive in the market.

COMPETENCIES

1. It is a source of competitive advantage in that it makes a significant contribution to perceived customer benefits.

2. It has applications in a wide variety of markets.

3. It is difficult for competitors to imitate.

METHODS TO DEVELOP STRONG COMPETENCIES

1. Striking strategic alliances or joint ventures wherever necessary.

2. Developing of value chains.

3. Creating market niches etc.

METHODS TO DEVELOP STRONG COMPETENCIES

4. Becoming a global player in size.

5. Acquiring the latest technology

6. Investing liberally in research and developmental activities.

7. Developing best brands

Marketing Analysis & Planning

… A Strategic Perspective

Internal - External -

Environmental ScanS.W.O.T. AnalysisS.W.O.T. Analysis -

• Strengths & Weaknesses: - Marketing

Company reputationMarket ShareCustomer SatisfactionProduct QualityService QualityPricing EffectivenessDistribution EffectivenessPromotion EffectivenessSales Force Effectiveness/CoverageInnovation Effectiveness

- Finance - Manufacturing - Organization

Opportunities:- Attractiveness- Success Probability

Threats:

- Political/Legal/Regulatory- Economic- Social/Cultural- Technological

MarketMarketPenetrationPenetration

MarketMarketPenetrationPenetration

Product Product DevelopmentDevelopment

Product Product DevelopmentDevelopment

MarketMarketDevelopmentDevelopment

MarketMarketDevelopmentDevelopment DiversificationDiversification

Four Basic Types of OpportunitiesFour Basic Types of Opportunities

Ansoff’s Product-Market Expansion GridAnsoff’s Product-Market Expansion Grid

PresentPresent MarketMarket

NewNewCustomers/Customers/ MarketsMarkets

Source: Philip Kotler, et al

Present ProductsPresent Products New ProductsNew Products

Skimming/Penetration Strategy:

Pri

ce L

evel

Promotion Expense MixHigh

Low

High

Low

SlowPenetration Strategy

RapidPenetration Strategy

SlowSkimming Strategy

Price/Promotion StrategiesPrice/Promotion Strategies

RapidSkimming Strategy

(Low price/heavy promotion) (Low price/low promotion)

(High price/high promotion) (High price/low promotion)

What is a Strategic Business Unit? (SBU)

A set of products or product lines With clear independence from other products or

product lines for which a business or marketing strategy should

be designed

Characteristics of a viable SBU

Unique business mission Definable set of competitors Integrative planning done independently Responsible for resource management in all

areas Large enough but not so large as to become

bureaucratic

Marketing at the SBU Level—Strategic Marketing

Strategic Marketing requiresDetailed understanding of market needs, and

Proactive use of competitive intelligence at the corporate as well as SBU’s levels

Strategic Marketing Focuses on what the firm do best at the SBU

level

To secure and maintain a sustainable competitive advantage

What is Competitive Advantage?

Competitive advantage is a company’s ability to perform in one or more ways that competitors cannot or will not match.”

Philip Kotler

“If you don’t have a competitive advantage, don’t compete.”

Seeking Competitive Advantages

Positions of advantage Superior customer value Lower relative total cost

Performance advantages Customer satisfaction, Loyalty, Market Share,

Profit Sources of advantages

Superior skills & knowledge, Superior resources, Superior business process

Situation Analysis Internal Analysis—company; capability etc.

External Analysis—customers, market definition, industry structure

SWOT Analysis Strengths, Weaknesses, Opportunities & Threats Identify & prioritize major problems and opportunities:

selection of key issues

Based on the firm’s core competencies, decide on future options