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Strategy
 

Strategy

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Strategy Strategy Presentation Transcript

  • Strategic Marketing Decisions Learning Outcomes
    • Appraise a range of corporate and business visions, missions and objectives and the processes by which they are formulated, in light of the changing bases of competitive advantage across geographically diverse markets
    • Identify, compare and contrast strategic options and critically evaluate the implications of strategic marketing decisions in relation to the concept of 'shareholder value’
    • Evaluate the role of brands, innovation, integrated marketing communications, alliances, customer relationships and service in decisions for developing a differentiated positioning to create exceptional value for the customer
  • Strategic Marketing Decisions Learning Outcomes
    • Demonstrate the ability to develop innovative and creative marketing solutions to enhance an organization's global competitive position in the context of changing product, market, and brand and customer life cycles
    • Define and contribute to investment decisions concerning the marketing assets of an organization
    • Demonstrate the ability to re-orientate the formulation and control of cost-effective competitive strategies, appropriate for the objectives and context of an organization operating in a dynamic global environment
  • Strategy
    • What is strategy?
    • Generic strategies
    • Competitive analysis/competitive advantage
    • Strategy in a complex & unpredictable world
    • Segmentation, Targeting & Positioning
    • Value proposition & competitive advantage
    • Why does strategy fail?
  • Strategy
    • Being best at doing things that matter most to customers
    • Building shareholder value by achieving superior customer value
    • Finding new and better ways of doing things to achieve the above
    • Nigel Piercy
  • From transactions to value Transaction marketing Brand marketing Relationship marketing Value-added marketing
  • From transactions to value Customer loyalty HIGH LOW Customer sophistication HIGH LOW Transaction Value Relationship Brand Nigel Piercy
  • Strategic Marketing Decisions …
    • … are concerned with:
    • How to create value – for customers and therefore for shareholders
    • How to harness the power of the internet
    • How to achieve totally integrated marketing effort
    • How to engender creativity in the strategy of the company
    • Nigel Piercy
  • Delivering Value-based Marketing
    • Develop deep understanding of customer needs, operating procedures and decision-making processes
    • Formulate value propositions that meet customer needs and create differential advantage
    • Build long-term relationships with customers so that loyalty and trust is built based on satisfaction and confidence in the supplier
    • Understand that delivering superior value to customers requires superior knowledge, superior skills, superior systems, superior marketing assets
    • Peter Doyle
  • What is strategy?
    • Strategy is a …
        • … plan
        • … pattern
        • … position
        • … perspective
        • … ploy
    • Mintzberg et. al.
  • What is strategy?
    • Strategy is a …
        • … plan - a consciously intended course of action
        • … pattern – a stream of consistent behaviours
        • … position – locating the organisation within the environment
        • … perspective – an ingrained way of perceiving the world
        • … ploy – a specific manoeuvre to outwit competitors
    • Mintzberg et. al.
  • Generic Strategies
    • Cost leadership strategy
    • Differentiation strategy
    • Focus strategy
    • Michael Porter
  • Porter’s Generic Strategies Focus strategy (differentiation) Focus strategy (low cost) Narrow (market segment) Differentiation strategy Cost leadership strategy Broad (industry wide) Product uniqueness Low cost Advantage Target scope
  • Strategy
    • Ansoff Growth Matrix
  • Strategy
    • Rational/formal approach
    • v
    • Emergent strategy approach
  • Rational/formal approach
    • Linear approach, distinct steps
    • Hierarchal structure of decisions
    • Uses models, planning frameworks
    • Detailed, explicit strategies
    • Chief Executive responsible for whole process
  • Emergent strategy approach
    • Iterative process
    • Consists of many small decisions taken throughout the organisation
    • These small decisions “emerge” into an articulated strategy
    • Requires empowerment
    • Requires systematic analysis throughout the organisation
  • Strategy in a complex & unpredictable world
    • Strategy Safari
    • a guided tour through the wilds
    • of strategic management
    • Mintzberg, Ahlstrand & Lampel (1998)
  • Segmentation, Targeting & Positioning
    • Segmentation
        • Choose variables on which to segment
        • Create segments for the market
        • Profile the segments & understand their needs
    • Targeting
        • Devise targeting strategy
        • Prioritise segments & choose which to serve
    • Positioning
        • Understand the target segment perceptions
        • Doole & Lowe (2005)
  •  
  • Segmentation
    • Definition
    • Market segmentation is the division of a heterogeneous market into homogenous groups of customers, each group (segment) reacting differently to promotion, communication, pricing and other variables of the marketing mix.
    • Market segments should be formed in such a way that differences between buyers within each segment are as small as possible.
    • Thus, every segment can be addressed with an individually targeted marketing mix.
  • Segmentation
    • Bases for segmentation
    • Geographic
    • Demographic
    • Geo-demographic
    • Psychographic (Lifestyle; AIO analysis)
    • Behaviour (esp. benefits sought)
  • Targeting
    • Evaluation of potential target segments:
    • Measurable?
    • Identifiable?
    • Accessible?
    • Substantial?
    • Meaningful?
  • Targeting Undifferentiated Our marketing mix The market Differentiated Marketing mix 1 Marketing mix 2 Marketing mix 3 Segment 1 Segment 2 Segment 3 Concentrated Marketing mix 1 Segment 1 Segment 2 Segment 3
  • Positioning
    • The use of various marketing techniques and marketing-mix variables to create the image or perception that will best fit with what the organisation wishes to be known for
  • A Perceptual Map of Supermarkets Jobber & Fahy A B C D X G E F High price Low price Narrow product range Wide product range
  • Steps to positioning
    • Define the segments in a particular market
    • Decide which segments to target
    • Understand what the target consumers expect and believe to be the most important considerations when deciding on the purchase
    • Develop a product (or products) that caters specifically for these needs and expectations
    • Evaluate the positioning and images, as perceived by the target customers, of competing products in the selected market segments
    • Select an image that sets the product apart from the competing products, thus ensuring that the chosen image matches the aspirations of the target customers
    • Inform target customers about the product (promotion)
    • Dibb et al
  • Repositioning - examples
    • Lucozade
    • Skoda
    • Samsung
    • Conservative Party?
  • Competitive Stances
    • Leaders
    • Challengers
    • Followers
    • +
    • Pioneers
    • Nichers
  • Sources of competitive advantage
    • Superior product benefit
    • Perceived advantage (through communication/branding)
    • Low cost operations
    • Legal advantage (e.g. patents, copyrights)
    • Superior contacts
    • Superior knowledge (of customers/markets, science/technology)
    • Scale advantages
    • Offensive attitudes (competitive toughness & determination to win)
    • Hugh Davidson (1987) Offensive Marketing
  • Strategic Choice Strategic Choice
    • GENERIC STRATEGIES
    • Cost leadership
    • Differentiation
    • Focus / niche
    • COMPETITIVE
    • ADVANTAGES
    • PRODUCT/MARKET STRATEGY
    • Market penetration
    • Product development
    • Market development
    • Diversification
    • ALTERNATIVE METHODS
    • Organic / Internal development
    • Acquisition
    • Joint development
    • Alliances
    Adapted from Drummond & Ensor, Johnson & Scholes and others How to Compete Direction of Growth Method of Growth COMPETITIVE POSITIONS Challengers Defenders Leaders Nichers