Marketing effectively

MARKETING EFFECTIVELY
• Strategic marketing is defined as a total system of
interacting business activities designed to plan ,price,
promote and distribute want satisfying products and
services to organizational and household users at a
profit.
• There are several aspects to know how to approach
effective marketing

Strategies are actions to achieve objectives.
It is the art of coordinating the means (money, human,
resources and materials ) to achieve the ends (profit
customer satisfaction and company growth) as defined
by company policy and objectives.

STRATEGY
HIGHER LEVEL MIDLEVEL LOWER LEVEL

• Higher level strategies : it includes deploying company
resources towards fulfilling the company’s aim for the
future with a view towards understanding changing
market conditions and keeping in mind long range
potential for its future development and profitable growth.
• Mid level strategy: it works at the level of business unit ,it
is more precise than corporate strategy .it covers 3 to 5
years period and focuses on quantitative and non
quantitative objectives.

The main goal of midlevel strategy is to:
1)Penetrate existing market with existing products
2)Expanding into new markets with existing products
3)Developing new products for existing markets
4)Develop new products for new markets (diversification).
Lower level strategy :it requires shorter time frame
(usually one year).

It would correlate with the company business plan and
budgeting process ,it works to achieve short term
objectives while supporting short term objectives and
strategies .it covers areas as pricing, discounts
advertising media and copy themes ,sales force
deployment and selling aids.

• Marketing strategies allow you to:
1) Interpret strategy principles and apply them to your own
business.
2) Identify the importance of time factor to strengthen your
marketing campaigns
3) Apply the basic strategic principles of speed, indirect
approach ,concentration ,alternate objectives and
unbalancing competition.

4) Devise competitive marketing strategies to outperform
your competitors.
5) Develop a strategic marketing plan as a line of
communications and an action oriented document.
Product positioning: product positioning is one of the
applications of marketing strategy.

Steps of product positioning include:
1) Selection of a competitive advantage that larger
competitors cannot perform efficiently .this can be
accomplished by employing formal and informal market
research to identify areas of differentiation.
2) Commit to quality and service as an organizational
priority .this is done by continuous training to all staff to
gain commitment to striving to quality

3) Focus on specialists products that allow premium price
.this is done by segmenting the market for specific
products and service applications.
4) Establish long term relationship with customers to grow
with them and build technology relationships .this is done
by encouraging trust with customers.
5) Maintain a market driven orientation throughout your
organization .this is achieved through

Organizing a team from various functions .the team will
develop a strategic marketing plan and use it as a line of
communication and an actionable document to respond
rapidly to market opportunities.
6) Seek global opportunities that complement long term
objectives. this is done by using internet and exploring
joint ventures.
7) Partnering sales people with customers to provide
solutions to customers problems .this is achieved by
continuous training.

8)Identify emerging ,neglected or poorly served market
niches .this is done through reassessing marketing
segmentation ,searching for additional approaches
beyond the usual criteria of customer size, frequency of
purchase and geographic location .looking for potential
niches related to just-in-time delivery ,product
performance and reliability.

• MANOEUVRING technique is another application of
marketing strategies .it means taking the most round
about route to the customer .its guidelines include:
1) Knowing the market: pinpoint the likely points that would
increase chances of success for entry .for example look
at geographic location, availability of distributors and
buying motives.
2) Assess competitors intentions and strategies.

3) Determine the level of technology required
4) Evaluate your internal capabilities and competencies
(never over estimate or under estimate your abilities)
5) Maintain discipline ,vision and seek developing a
winning spirit.
6) Secure financial resources :this is necessary because if
competitors detect financial weakness they can simply
play the wait game.

7)Develop a launch plan to market your product, shape the
marketing mix (product, price, distribution ,promotion)
8)Maintain a sensitive awareness of how customers will
respond to your product offering by using market
researches to point what motivates customers to buy
your products.

It is clear that although higher technology computerized
reports and internet based data are available yet the
human factor is still irreplaceable in the marketing
process .marketing is considered as a battle of minds in
which every one tries to disrupt the competitors plan
against him.

• Disruption takes place at two level: physical and
psychological.
• physical disruption :includes a series of moves
To upset your competitor’s plan through pinpointed
Actions against his market position .an example of this is
to develop plans to cancel any advantage a competitor
might have in making on time deliveries by matching or
exceeding the time.

• psychological disruption :it involves the effect any
physical move has on the mind of the competing
manager .
• The combination of both techniques will lead to distract
the competitor from his efforts and limit his moves .
• The marketing strategy techniques is similar to military
ones and takes various forms:

MARKRTING EFFECTIVELY
ATTACKING
STRATEGIES
DIRECT
ATTACK
INDIRECT
ATTACK
ENVELOPMENT
ATTACK
BYPASS
ATTACK
GUERRILLA
ATTACK

• The direct attack: this technique leads to huge loss .it
needs at least 3:1 competitive advantage failure in such
attack is documented through out the history advantage
failure in such attack is documented through out the
history.the marketer who applies this technique has no
execuse and has no place in todays competitive
environment.

• The indirect attack :the attacker launches a primary
attack against one of the competitor’s weaknesses and
uses a secondary direct attack to distract attention away
from primary effort.
• This is one of the most fruitful approaches .it has the
greatest chances of success while conserving the
greatest amount of strength.
• It concentrates on a market segment that is emerging
,neglected or poorly served .

• Envelopment attack :it consists of two stages.
First as an indirect attack the aggressor focuses on a
specific market segment for a point of entry then by
identifying additional market segments and adding new
products ,it uses an expansion strategy to envelop the
entire market .for example SEIKO entered the north
American market by one type of watches then enveloped
the market with over 400 models of these watches.

• Bypass attack: it allows the attacker to circumvent its
chief competitors and diversify into unrelated products
or all new geographical markets allowing compensation
of missed opportunities .

• Guerrilla attack :it involves small intermittent forays into
different markets .applied mainly when a small company
is competing against a large corporation or by a larger
organization against its competitor .it involves actions
like selective price cuts ,supply interference and
intensive promotional bursts .the aim of such movements
is to cause distraction leading to mistakes.

Unbalancing
Competition
Alternative
objective
Concentration
Speed
Indirect
Approach
STRATEGY
PRINCIPLES

• Speed is extremely critical in our business. Drawn out
efforts divert interest and depress morale .the gap of
time created through lack of action gives the competitor
greater chance to react .two factors help reacting with
speed which are:1)new technology,2)effective
organization.
• The drawbacks of multi levels in decision making
process are:
1)Loss of time in getting information back.

1)Loss of time in getting information back
2)Loss of time in sending orders forward
3)Reduction of top executives full knowledge of the
situation
4)Reduction of the top executive’s personal influence on
managers.
To increase speed of operations the following is required

1)Reduce the reporting level and increase the pace of
communication from the pace to head office.
2)Utilize junior managers for flexibility and identifying and
taking advantages of new opportunities.
3)Use cross functional strategy team that tap any culture
diversity that exists in the firm.

• Indirect approach: to use an indirect approach do the
following:
1)Search for emerging ,neglected and poorly served
market segments through competitive analysis.
2)Identify a competitive advantage centered on the,
marketing mix (price, product, promotion distribution)
3)Use surprise and speed to disorient your competitor.

4) Move towards market expansion once gaining a point of
entry.
Concentration: it has two uses in strategy:
1) Directing resources to a certain market segment
2) Focusing your strength against competitor weakness.
Alternative objectives: there are 4 reasons to develop
alternative objectives:1)most businesses need a wide
range of objectives with a variety of strategies and time
frames.

2)The strategic principle of concentration is implemented
successfully through the application of alternative
objectives.
3)It permits enough flexibility giving options to achieve one
objective while other fails.
4)It keeps your competitor on the horns of a dilemma
obliged to spread his resources and efforts to match your
action.

• Unbalancing competition: it fulfils strategy’s ultimate
purpose which is the reduction of resistance .to
unbalance the competitor you have to:1)identify the
areas in which the competitor is not able to respond to
your action.
2)Use the surprise factor
3)Utilize new technology as electronic reporting systems.

• The previous principles of market strategy give rise to
important lessons which are:
1)The tools of marketing are physical acts and need a
mental process to direct them ,thus keep the marketing
principles in the forefront of your thinking which will give
you the upper hand at the least cost in human and
material resources.
2)The tougher you make your marketing practices
The more the competitors will consolidate against you
which will harden the resistance you face.

3)The more intent you are in securing a market of your own
choosing and terms the more obstacles you will face
4)If you are trying to dislodge a competitor from a strong
market position leave him an easy way to exit the market
do so by initiating value added services obligating the
competitor to pump in far more resources than budget
calls for thus giving the impression that it would be
prudent for him to pull out.

Customer analysis: the customer is the center of
marketing’s attention. Guidelines for customer analysis
include:
1) Define the customers by demographic and
psychographic characteristics :look for unmet customer
needs, talk with customers to know their problems and
encourage sales people ro innovate.
2) Examine customer usage patterns and frequency of
purchase :observe deviations in seasonal and regional
purchase patterns and translate to opportunities.

3)Survey selling practices :tune in to current trends
In promotional allowances ,selling tactics ,trade discounts
and purchase opportunists.
4)survey supply chain: examine own distribution channels,
warehousing and seek opportunities for innovation as
electronic ordering.
5)Look for product possibilities and line extensions.
6)Explore opportunities to cut costs for yourself and your
customer.

• Components that form customer analysis are:
Market and product segments, patterns of customer
behavior and unfulfilled wants and needs
Market and product segments segmentation means
splitting the overall market into smaller sub-markets or
segments that that have more in common with one
another than the total market. Certain criteria must be
put in consideration in choosing a market segment:

1)It must be measurable :possibility to quantify example
:how many factories? How many residencies?......etc.
2)It must be accessible
3)It must be substantial :is it of sufficient size to warrant
attention as a segment?
4)It must be profitable.
5)Compatible with competition: is it of active interest or
negligible interest to the competitor?

6)It must be defendable :this mainly depends on the
organization personnel and their effectiveness.
Categories to segment market are :demographic,
geographic ,psychographic and product attribute factors.

demographic psychographic geographic Product attribute
sex lifestyle region Usage rate
age Psychological
variables: personality
,self image
urban Product benefits
family Cultural influences:
group behavioral
patterns
Population density
race City size
education climate
income
occupation
Family size
religion
Home owner ship

A famous method to segment the market is to apply field
ethnography technique (ethnography is the study of
people in other cultures and the resultant written text
from that culture).
It includes four major steps:
1)Maping a segment: using personal information and data
base while describing in non judgmental terms .
2)Create an exclusive language :avoid using own
professional language to avoid bias ,better use terms
borrowed from a neutral field .
3)Observe body language and non verbal buying signs.
4)Describe the ritual which is a collection of symbols which
a good separates out and considers one by one.

The second factor to consider is patterns of customer
behavior. the behavior must be interpreted and
connected to strategy selection.
The last factor is determining the unfulfilled wants and
needs of various customer segments aiming for
customer satisfaction through the following steps:
1)Define customer requirements and expectations through
gathering continues feed back.
2)Maintain a system of customer relationship management
such as customer service
3)Adhere to customer service standard such as time to
handle complaints on time shipment…..etc

4) Make commitment to customers a company ritual, a
commitment means guarantee that include :stock order
shipped the same day received ,technical service teams
sent to customers specialized training provided to
customers…etc.
5) Resolve complaints to achieve quality improved results
:complaints must be solved on the spot and formally
reported to a customer satisfaction committee.
6) Determine what constitutes customer satisfaction
7) Customer satisfaction results must be circulated so that
next year objectives can be determined
8) Compare customer satisfaction levels with that of
competitors through formal and informal bench marking.

• Competitor analysis :it gives a picture of the rival’s
position in the market thus uncover their weak spots .to
analyze competitor’s strategies is to categorize them by
strategic group :
1) Companies that pursue a differentiation strategy which
rely on product line depth, quality ,service and brand
identification policy.
2) Companies that follow a low cost strategy base their
operations on economies of scale ,the experience curve
and manufacturing facilities.
3) Companies that use a focus strategy go after the
boundaries of competitor’s product line and served
markets.

• Industry analysis :rate the industry readiness to accept
new products ,technologies and value added service.
estimate industry the stage of own industry in its life
cycle.
Industry analysis includes several levels:
Level (1) check list includes: suppliers, existing
competitors ,emerging ones, alternative product
Offering (aluminium instead of steel …..etc) and
customers.

• Level 2 analysis :it is a more detailed analysis that
includes:1)current demand for product
2) Future potential for product: three to five years
timeframe to forecast the product potential.
3) Industry life cycle: the stage of your industry in its life
cycle (introduction ,growth ,maturity and decline)
4) Emerging technology
5) Changing customer profile

6)Frequency of new products introduction.
7)Level of governmental regulation: regulations change
from time to time and these changes must be monitored.
8)Supply chain
9)Entry and exit barriers: capital investment needed, extent
of economies of scale.
10)Marketing innovations
11)Cost structures: impact of cost on market efforts.

• Environmental analysis: it requires looking beyond the
immediate market scope, several steps are required to
do so as:
1) Market penetration
2) Product development
3) Market development
4) diversification.

• Internal analysis: internal analysis allows us to “look in
the window” to examine the capabilities of your own
organization in defending or attacking markets.
• Performance analysis: it relates to structure, people,
culture ,tasks, resource utilization, innovation and
productivity .within an organization ,a culture exists with
a highly individualized DNA that will influence its actions.

• Guide lines for performance improvement:
1) Allow information to flow down wards without routine
obstacles.
2) React fast to aggressive competitors.
3) Allocate proper planning and time to avoid hasty
decisions.
4) Master the art of launching a product.
5) Stay updated to technological changes.
6) Fastly adopt your system with updated communication
tools.

• Strategy analysis :this includes the ability to react quickly
and shove aside aggressive competition ,protect market
share and utilize the organization resources. in general
(protecting an existing market share is cheaper than
gaining new one)
• Strategic priority analysis: set priorities for your strategy
putting customer satisfaction in the top
Search areas as product development, production
skills,distibution or complaint handling.

• Develop business building strategies on two
goals:1)deliver ever improving value to customers.
2)Communicate to customers your company’s readiness to
improve its overall company performance.
Cost analysis: in general regardless of the company size
there is no need to compromise between market share
and profitability goal. if a cost analysis is conducted to
maintain a balance of costs and expenditures that are
synchronized

With marketing objectives.
Guide lines to maintain balance between market share,
growth ,costs and profitability:
1)Take in consideration that maintaining market share is
less expensive than building a new one.
2)Look at the criteria used to evaluate market share. if you
are serving only a segment rather than an overall market
then there are implications for costs and profitability.

3)Defending market share is less expensive than buying it
back after being pushed by competitors.
4)Examine components that contributes to increase in
market share and choose which strategy would impact
your cost structure and profitability:1)customer
penetration,2)customer loyalty,3)customer usage 4)
price selectivity.
Selection of a strategy will need an understanding of
experience curve and forecasting techniques.

• Experience curve: the Boston consulting group
conducted thousands of cost studies and showed that
each time the volume of a product doubled the total
costs (administration ,sales, marketing distribution and
manufacturing) fell by a constant and predictable
percentage. further the cost of purchased items fell as
suppliers reduced prices as their costs fell. this relation
ship between cost and experience is called the
experience curve.

• Knowing that cost will be reduced each time production
is doubled is only part of the equation, the other parts
are in knowing which factors contribute to the experience
curve and then incorporating those factors into your
marketing plan.
Cost -customer relationship profile:
1) basic: a one time purchase customer, profit margin is
low thus a customer person to maintain telephone
contact is sufficient.
2) reactive: customer call for assistance with a product
problem thus a periodic check is appropriate.
3) accountable: sales rep calls the customer a short time
after purchase to check if product is meeting
expectations .this action begins a proactive approach to
relationship marketing

• Proactive: periodic meeting between customer and sales
rep is involved to recommend improved products
• Partnering: the sales person and a team of specialist
work intensely to solve customer’s problem. it ranges
from regular contact to the extreme of placing a technical
person full time at customer location.
Practically speaking accumulation of experience

Curve faster than competitors will give the advantage of
price flexibility.
The implications of experience curve are:
1) A competitive advantage is possible if greater
experience curve is accumulated .the resulting cost
advantage can be used to plough back investment to
achieve additional manufacturing efficiencies.
2) It is almost preferred to study competitors experience
curve.

3)It is used to forecast costs thus setting prices.
Sales forecasting techniques: the purpose of sales
Forecasting is to anticipate future events and develop
strategic means for controlling them.
The forecasting techniques are either judgmental
methods involving experts opinions as executives ,sales
people and informed outsiders or market surveys using
buyer surveys and market tests.

• Judgmental methods:
1) Judgment from extremes: an expert gives an opinion
about the sales whether extremely high or extremely low
if neither seems probable the range between the
extreme is successively reduced until an approximate
level is reached
2) Pert –derived method:
Forecast=(O+4M+P)/6
O=optimistic estimate ,P=pessimistic estimate, M=
Most likely estimate.

• The standard deviation is then derived
SD=(O-P)/6
The forecast range=(O+P+4M)/6(+or -)2x((o-p)/6))
3) Group discussion method: the team meets as a
committee and comes up with a group estimate.
4) Pooled individual estimate method: a project leader
simply merges separately supplied estimate into a single
estimate without interplay with or between participants.

5) Delphi technique: group members are asked to submit
individual estimates and assumptions ,reviewed by
project leader then fed back to participants for a second
round .participants are also informed of the median
forecast level that emerged from the previous round.
After successive rounds of estimating and feedback ,the
process ends after a consensus emerges.

6) Jury of executive opinion: a jury of executive opinion is
often is often composed of top level personnel from
various key functions such as sales ,production and
finance .
7)Composite of sales force opinion :It collects product,
customer and or territorial estimates from individual
sales people in the field .
8)Outside experts :knowledgeable sources could be
consulted as trade associations or economists.

• MARKET SURVEY:
1)Consumer surveys: surveys from consumers are
gathered periodically. this technique works best for major
for major consumer durables and industrial capital
expenditures .
2)Test marketing :a new product or a variation in the
marketing mix for an established one is introduced in a
limited number of test cities. the entire marketing
program that is scheduled on a national bases is put into
effect and scaled down to the local level providing a
significant mini picture of the full scale reaction to th e
planned change.

method nature benefit Draw backs
Judgment from the
extremes
Successive
narrowing of high
low range
Range instead of
single figure
Depends on
individual estimating
Group discussion Group estimate Merges divergent
view, moderate bias
Dominated by one
individual
superficially
Pooled and
individual estimates
Averaging of
individual estimates
Avoids group
discussion pitfalls
Lacks group
dynamics
Delphi technique Successive written
rounds of estimating
with feedback from
other participants
Eliminates
domination,
conservatism,
superficial response
Lacks group
dynamics

Jury of executive
opinion
top level committee quick Un familiar with
market conditions
Composite of sales
force opinion
Adjusted estimates
from individual sales
people
Front line expertise
motivational tool
Bias due to impact
on compensation,
unfamiliar with
economic trends
Out side experts Merging of outside
opinion
No bias due to
personal interests
Difficult to assess
degree of expertise
Consumer surveys Consumer
interviews about
buying intentions
Directly from the
horse’s mouse
Hypothetical
behavior
Test marketing Sales in limited
number of cities
Actual sales results Costly, time
consuming ,exposed
strategy to
competitors.

• PORTFOLIO ANALYSIS :it consists of formal models
that provides a systematic approach to assessing a
competitive position and determining investment levels. it
is used for self contained organizational units in which
we make investment decisions on market by market or
product by product bases. three models are used to
assess the portfolio (Boston consulting group growth-
share matrix, General electric business screen and
Arthur D. little matrix.

• BCG growth-share matrix: it allows to evaluate where
your products and markets are relative to competitors.

• The quadrants of the matrix categorizes products into
four groups
Stars: products that have high market growth and high
market share these are products that need constant
attention to maintain or increase share through active
promotion, product improvement and careful pricing
strategies.
Cash cows: product that have low market growth and
high market share .it holds market dominance and
generate strong cash flow. the object: retain a strong
market presence without

Large expenditures for promotion and with minimal
outlay for research and development.
Question marks: products with potential for high growth
in a fast moving market but with low market share .they
absorb a large amount of cash and are expected to
reach the status of a star.
Dogs: product with low market growth and low market
share ,reflecting the worst of all situations. a number of
alternatives possible ,maintain the product in the line to
support the

• The image of being a full line supplier, eliminate the
product from the line ,or harvest the product through a
slow phasing out.
• The interpretations of the matrix are as follows:
1) Amount of cash generated increase with relative market
share.
2) The amount of sales growth requires proportional cash
input to finance the added capacity and market
development .if a market share is maintained ,then cash
requirement increase only relative to market growth
share.

• 3)cash input is required to keep up with market growth
.increasing market share usually requires cash to
support advertising and sales promotion expenditures
while a decrease in market share may provide cash for
use in other product areas.
4)In situations where a product moves towards maturity ,it
is possible to use enough funds to maintain market
position and use surplus funds to reinvest in other
products that are still growing.

• General electric business screen: the GE approach
illustrates where an existing product fits competitively in
relation to a variety of measures .it aids in projecting
chances for anew product success.
• The key points in using GE business screen are:
1)Industry attractiveness is shown on vertical axis
2)Business strength is shown on horizontal axis
3)The matrix is divided into three color sectors

• THE green sector (three cells at upper left) indicating
those markets that are favorable in industry
attractiveness and business strength .they have green
light to move in aggressively.
• The yellow sector (diagonal cells stretching lower left to
upper right) indicating medium level in overall
attractiveness.
• The red sector (three cells in lower right )indicating those
markets that are low in overall attractiveness.

• The Arthur D.LITTLE matrix: the competitive position of
the products are plotted on the vertical axis while the
maturity level of the products are designed on the
horizontal axis
The key interpretations are:
1) Non viable: the lowest possible level of competitive
position
2) weak: unsatisfactory financial performance but with
some opportunity for improvement

• Tenable: financial performance is barely satisfactory
.they have a less than average opportunity to improve
position.
• Favorable: a competitive position better than the survival
rate. These products have a limited range of
opportunities for improvement.
• Strong: able to defend market share against competing
moves without the sacrifice of acceptable financial
performance.

• Leading: it incorporates the widest range of strategic
options because of the (competitive distance between
the given products and the competitor’s products).
• A green, yellow, red system is used to indicate strategic
options .
• Green indicates a wide range of options
• Yellow indicates caution for a limited range of options.
• Red is a warning of options narrowed to those of
withdrawal .divestiture or liquidation.

• Financial resource analysis: to assess financial situation:
• 1)current to past sales comparison
• 2)customer satisfaction evaluation
• 3)sales rep qualitative evaluation.
• Quantitative techniques to identify financial implications
of strategies:
1)Return on investment: there are several approaches to
calculate R.O.I.

• The most often used are:
Return on investment:
ROI=(NETINCOME/INVESTMENT)X100
Return on sales:
ROS=(NET INCOME/TOTAL SALES)X100
Cash flow
CF=(Net income+ depreciation)-(change in plant and
equipment)-(change in working capital)

2) Market share analysis: a decision of which measure of
market share will be used:
Overall market share :the company ‘s overall market
share is its sales expressed as percentage of total
industry sales
Served market share: sales expressed as a percentage
of the total sales to its served market.
Relative market share: the company sales

Expressed as a(%) of the combined sales of the three
larges competitors.
Relative market share (to a leading competitor): tracking
the sales as a(%) of the leading competitor sales.
3) Marketing expense to sales analysis: it is a must to
monitor the total expenses to the outcome sales.
4) Strenghths /weakness analysis: it is important to

• Assess the company core competence before entering
new markets putting in consideration that competitors
can see only the tactics not the strategies through which
market success is achieved. it examines the strong and
weak points in comparison with those of competitors
Allowing the concentration on areas of highest potential
for market expansion.

• Determining where to sell your product relies on
accurate intelligence to pinpoint opportunities.
Develop a frame work for acquiring and organizing
market information:
1) Use information from internal records
2) Develop a market intelligence system which provides in
depth information that aids in the decision making
process.
3) Systemize your approach to develop market intelligence
as follows

Overall exposure to information from newspapers, trade
publications…etc.
Controlled exposure to a clearly identified area of
information by talking informally to customers,
suppliers…etc
Informal research to obtain information for a specific
purpose.
A planned effort to secure specific information .e.g.
Through customer marketing research firms.

• The high cost of intelligence delivered by an information
system is only justifiable as long as it improves decision
making such a system can accomplish the following:
1) Monitor competitors actions to develop counter
strategies
2) Identify neglected or emerged market segment
3) Assist in decisions to add, drop or modify a product
4) Develop more accurate ,strategic market plans.

CAN DO CAN NOT DO
Track progress to long
Term strategic goals
Replace managerial judgment
Establish a common language between
marketing and back office operations
Provide information necessary to make an
infallible decision
Aid in day to day decision making Work successfully without management
support
Consider the impact of utilizing similar
marketing strategy on multiple marketing
segment.
Work successfully with out confidence
Automate many labor intensive process
leading to huge saving
Work successfully without being adequately
Maintained and responsive to user
community
Serve as early warning device for
operations not on target.

CAN DO CANNOT DO
Help to determine how to allocate
resources to achieve market goals
Help serve customer more effectively
Enable to improve overall performance
through better planning and control
Alert to unusual competitive activity that
would indicate developing problems
Improve control over marketing and non
marketing activity
Provide marketing and economic data on
unusual problems to appropriate action
Anticipate competitor moves on time

• The previous slide demonstrates what a system can do
and what it cannot do
Guide lines to assemble competitor intelligence:
Accumulate field data from sales people at first line
Gather published data
Assemble the data e.g. approaching individuals who
came in contact with competitors and key events.
Organize the data

Management analysis of data, transmitting the
intelligence to practical strategies. To sum this up the
criteria of competitive intelligence must be as follows:
1) C.I. must be accurate
2) C.I. must be timely
3) C.I. must be usable
4) C.I. must be understandable
5)C.I. must be meaningful

C.I. applications on product life cycle introduction
stage:
1) It determines whether a product is reaching the intended
audience segment
2) Analyze the marketing mix and various components for
possible modifications
3) Monitor initial product positioning to prospects
4) Identify possible points of entry by competitors

5) Evaluate distribution channels
6) Compare initial financial results to budget
At the growth stage:
1) Analyze product purchase by market segment
2) Identify emerging market segment
3) Conduct competitor analysis and determine counter
strategies
4) Adjust the marketing mix
5) Decide on use of penetration (low) pricing

6) Provide new incentive for sales force
7) Monitor financial result against plan
8) Provide feedback on product usage.
At the maturity stage:
1) Evaluate differentiation possibilities
2) Determine extension strategies (new applications for
new market segments)
3) Expand product using among existing market segment

4) Determine potential for product line extension
5) Monitor threats on market segments and threats to total
market share
6) Evaluate financial performance ,particularly profitability
At the decline stage
1) Evaluate options as concentrating on a specific market
niche.
2) Determine where to prune product line to obtain best
profitability

3) Monitor financial performance
4) Identify additional spin off opportunities through product
application.

• Market research is the systematic gathering processing
and analyzing of data to solve the organization short and
long term competitive problems. market research should
be systematic ,comprehensive and objective.
• Market research guide lines:
1) M.R. should be accurate
2) M.R. should be timely: events have cycles that once
pass may not occur again

3) M.R. should be usable
4) M.R. should be understandable
5) M.R. should be meaningful.
In market research ,first primary data is collected
followed by secondary investigation
Three major methods are used to generate primary data
(experimentation, observation and interviewing)
Experimentation: it involves creating artificial

• An artificial situation except all variables in except the
one to be tested are kept constant.
Observation: either face to face or through electronic
devices
Interviewing: it takes three forms (in person, telephone
and mailing interview)

POINT OF
COMPARISON
IN PERSON TELEPHONE MAIL
Flexibility in data
collection
Most flexible Fairly flexible Least flexible
Quality of data
obtainable
Fairly extensive Generally limited Long questionnaires
affect response rate
Speed of data
collection
Time consuming Available almost
instantaneously
Delayed results from
slow and scattered
returns
Expense of data
collection
Most expensive Less expensive Least expensive
Investigator bias high medium Non available
Lead time for
respondents
Need to respond
quickly
Need to respond
quickly
Have time to think

POINT OF
COMPARISON
In person Telephone mail
Sampling
consideration
Requires detailed
address
Requires random
digital dialing
Requires mail list
Anonymity of
response
Eye contact may
stifle frank
interchange in
sensitive issue
Same as with
person interviews
Frank response can
be obtained by
guaranteeing
anonymity
Identity of
respondents
Available for future
reference
Telephone numbers
are available for
future reference
May not be available
in some cases
Field control Difficult and
expensive
Centralized Control
represents no
problem
Not a problem

POINT OF
COMPARISON
IN PERSON TELEPHONE MAIL
Geographical
coverage
Limited due to cost
considerations
Call centre permits
wide coverage
Geographical
coverage is no
problem
Investigator
assistance
Easily available to
explain instructions
Available although
not to the same
extent as in
personal contact
Not available

• Focus group technique :it involves the simultaneous
interviewing of a group of individuals, physicians, home
makers, police officers ,purchasing agents in a casual
round table discussion involving (6-10)persons offering a
quick and un expensive research technique.
This technique is used to:
1) diagnose competitor strength and weakness
2) Spot the source of marketing problems

3) Spark new product lines
4) Expand the product use
5) Identify new advertising or packaging themes
6) Test alternative market approaches.
It must be video taped to examine gestures and facial
expressions
Image research: an image consists of attitudes, beliefs,
opinions and experience

• Developing an image: an
image stems from a
multiple of factors e.g.
choice of brand name,
the symbolism used
(logo, slogan. jungle,
color shape ,packaging
CONTROLABLE
IMAGE
INGREDIENTS
WHAT THEY CAN DO
design Provides aesthetic
appeal
color Sets a mood
shape Generates recognition
package Connotes value

• This table illustrates the
marketing mix and
product image
Controllable image
ingredients
What they can do
name Express central
idea
slogan Creates
memorability
advertising Communicates
benefits
Sales promotion Stimulates interest
price Suggests quality
Channels of
distribution
Determines prestige
warranty Establish
believability
service Substantiates
product support

• Changing an image: an image can be changed only
through quality. good image leads to a competitive edge.
• After going through primary data collection .secondary
data investigation takes place through: industry studies,
trade associations and suppliers of commercial
marketing data. The central methods for gathering
market data include the following.

Competitive audits: measuring market share and find out
how competitors stack up against each other in product
quality
Customer satisfaction studies: by tracking performance
over a period of time measuring progress.
Perceptive review: discovering through formal research
techniques how competing products are perceived.
Testing new products at conceptual stage

• Firms with written plans grow faster , achieve higher
proportion of revenues than those with un written plans.
Strategic marketing planning functions as the operating
system to manage long term objectives and day to day
activities
The screening process includes (present markets,
customers ,growth markets and new product
development)
Present markets: investigate new business, acquire

New users, displace competitors, redefine market
segments, reposition the product….etc
Customers: improve distribution channels ,refine product
pricing policy, enhance customer service using technical
service and complains handling.
Growth markets: target key geographical locations.
New product development: focus on new products that
can be differentiated and that have new potential for
extended sales cycle.

Examine techniques to modify products by customer
groups ,distribution outlets or individual customer
applications
Target opportunities: by focusing on area outside market
segment or product line not included in other category.
The strategic marketing plan:
It includes two portions the strategic plan and the market
plan fused together at the end to form one unit.

• The strategic plan: it
involves several aspects .
Strategic
plan
Strategic
direction
Objectives
and
goals
Growth
strategies
Business
portfolio

• The strategic direction: it
is the vision or mission
statement of the
organization in three to
five years time. It involves
the managerial team from
various departments. It
aims in building a market
driven orientation.
Product driven
orientation
Market driven
orientation
Rail road company Transportation
company
Oil company Energy company
Baby food
manufacture
Child care business
Cosmetic company Health care
company
Computer
manufacturing
company
Information
processing
company
Electrical wire
manufacturer
Energy transfer
business
Vacuum cleaner
manufacturer
Cleaner
environment
business

• It is better for the organization to position itself between
the extremes of a market driven and a product driven
organization this mainly depends on:1) the organization
culture (conservative, aggressive…etc) 2) availability of
human ,material and financial resources 3)the amount of
risk that managers are willing to go into debt.
• 4)the threat of competitive activities and their survival to
growth.

Objectives and goals: objectives and goals can be
quantitative and non quantitative, quantitative ones are
those related to figures as market share, sales growth.
.etc while non quantitative are those related to business
support as improving reporting system, applying new
marketing intelligence systems…etc.
Growth strategies: if objectives indicate what we want to
accomplish then growth strategy deals with how to
achieve those objectives.

• The major guidelines are: each objective must have a
corresponding strategy, if no strategy then no objective
at all.
• Strategies are either external or internal
Internal strategies: internal strategies relate to marketing
manufacture, distribution, pricing, market research,
packaging information technology finance, sales
activities.. information technology, finance, sales
activities and organizational changes.

• External strategies: refer to possibilities as joint
ventures, licensing agreement, emerging market
segments an diversification opportunities
• Business portfolio: a strategic direction has a meaning
only if it is translated to a business portfolio of markets
and products

• The marketing plan: it
includes one year tactical
frame work.
• It starts by situation
analysis
Marketing
plan
Situation
analysis
Market
opportunity
Marketing
objectives
Strategy
And action
plans
Financial
Control and
budgets

Situation
analysis
Marketing
mix
Market
Back ground
Competitor
analysis
product price promotion distribution

A) Product: a product is studied passing by the following
aspects: 1)sales history
2) Position in industry.
3) Future trends in industry
4) Intended purpose of the product in terms of market use
and uniqueness
5) Features and benefits of the product in terms of costs,
safety or convenience.
6) Other product information such as quality, size..etc

B) Pricing: price of company and competitor is evaluated
for each market segment, pricing trends are anticipated
on bases of source and raw material
c) distribution: the investigation involves current channels
of distribution, effectiveness of coverage through current
channels ,special functions performed by the company
sales force
And finally future trends in distribution methods and
channels

D) Promotion: the investigation includes analyzing the
advertising and sales promotion directed at each market
segment.
Indicate past and current advertising and sales
promotion strategies
Describe publicity ,education and other non advertising
influence

• Market background: the investigation involves
Customer profile, frequency and magnitude of product
usage, geographical aspects of product usage.
customer characteristics, decision making, ,customer
awareness, customer motivation, segment trends.
Competitor analysis: it involves listing the major
competitors in descending order and showing relative
market share, competitor strength and weakness

and Product comparison including pricing, features,
advertising, distribution system ,sales method,
packaging, competitor share, attitude of customers,
sales force effectiveness and market coverage,
The second factor in the marketing plan is market
opportunities
The proper planning involves investigation for:

a) Present markets by cultivating new users, displacing
competitors, increase present customer usage ,
repositioning and defining new market segments.
b) Buyers: increase buyers by expanding distribution
channels, product pricing ,product promotion, growth
markets ..etc
c) Growth markets: by identifying opportunities for growth

D) Product and service development innovation: including
immediate and long term opportunities for addition of
new products, diversification…etc
e) Target opportunities: listing areas of exploring new
chances
The third factor in the marketing plan is marketing
Objectives. It involves primary objectives (quantitative
ones) and functional objectives which concerns both
product and non product related goals

• For the objectives to be clear assumptions must be
generated these assumptions include:
1) Economic assumptions: about futuristic changes in
competitor activities, growth, costs.. etc
2) Technological assumptions: intensity of research,
development, technical breakthroughs. .etc
3) Socio political assumptions: probability of political
tensions …etc

• The fourth factor is strategy and action plans: it includes
(product ,pricing , advertising ,media and promotion
strategies)
• The last factor is the financial control and budgets which
must be revised periodically and consider corrective
measures.
The total marketing plan will fuse together in general it
takes 6 month period for the final version

Planning activity Unit responsible
Marketing research conducts situation
analysis and generates back ground data
Marketing research
Marketing research develops assumptions
about future environment and identifies
current position
Marketing research
Top managers set corporate objectives Top managers
Marketing vice president interprets
corporate objectives and derives marketing
objectives with input of strategy team or
product managers
Vice president marketing
Sales and expense forecast are
established
Marketing research controller
Product managers develop optimum
strategies for their assigned lines and
review with marketing vice president
Product managers, vice president
marketing

Planning activity Unit responsible
Product managers design detailed action
programs and review with general sales
manager
Product managers and general sales
manager
Product managers write up their proposal
and submit to marketing vice president
Product managers
Marketing reviews and coordinates
individual product plans
Vice president marketing
General sales managers assign district
volume directives
General sales manager
District managers develop district sales
plans in consultation with sales people
District sales manager
General sales manager reviews and
integrates district sales plans
General sales manager
Product managers prepare financial
summaries
Product managers

PLNNING ACTIVITY UNIT RESPONSIBLE
Controller prepares operating budgets controller
Top management reviews and
approves marketing plan
Top management

STRATEGIC PLAN
3 to 5 years
Strategic
direction
Objectives and
goals
Growth
strategies
Business portfolio

MARKETING
PLAN
1 year
Situation
analysis
Market
opportunities
Marketing
objectives
Strategies
And action
plans
Finance
Control
And
budgets
Marketing
mix
Marketing
background
Competitor
analysis
Targets of
opportunity
Primary
objectives
Functional
objectives

• We must avoid spreading the market efforts so thin other
wise this will make us vulnerable to competitors. If we
are starting in anew market we must analyze according
to some characteristics: a) responsiveness (tied to just in
time delivery. b) quality control (cost saving is always
related to improved quality) c) nearness to customers
always related to a speedy response d) communication
system e) dependable production schedules:
commitment

To customers sales
forecasts.
Market entry strategies:
Strategy
applications
First in
strategy
Follow the
Leader
strategy
Last in
strategy

• First in strategy: it has the advantages of locking key
distributors and customers and gaining a market leader
reputation. Studies showed that being first introduced
into the market even if it is over budget is better than
coming in later but on budget. The downside is that
rushing to the market before the product is thoroughly
debugged can result in a negative image.

• Follow the leader strategy: a firm must time its entry with
the competitor, both companies would gain from the
promotional impact of advertising the product category
and would share the overall promotional costs of the
launching.
Late entry: it has some clear cut advantages, the first
entry company will have borne the cost of educating the
market, the late entrant also can avoid product flaws and
take time to appraise the market size, profile the buyer
and target viable segments that remain untapped.

The decision in which strategy to follow depends on the
firm resources, the ability to sustain a competitive edge
and the long term objectives.
Market commitment: there are two dimensions to market
commitment yours and your competitor
The commitment is decided through side by side
analysis of how much commitment will be given to key
areas such as new product development
Market share desired and willingness to sustain an

Aggressive promotional
effort against competitors
Market demand strategy
strategy
Pruning
strategy
Key market
strategy
Harvesting
strategy

Guide lines for product introduction:
a) Selecting markets: markets selected must align with a
long term demand strategy and the commitments of
competitors to match or exceed the product
introduction must be put in consideration.
b) Entering markets: assess the suitable points of entry.
c) Building market share: produce the product as a
private brand, establish the brand name

Then continue with
product development.
d) Protecting market share:
protecting market share is
often much easier than
regaining a lost one.
Market diversification:
Diversification
horizontal vertical lateral
Merge and
acquisition

• Horizontal diversification: adding new business related to
existing products or supply chain capabilities (it is the
most promising and least risky strategy.
• Vertical diversification: adding another stages of
production or distribution to existing operations.
• Lateral diversification: diverse into unrelated business
using new technology and market strategy.( it is the most
extreme form)

Merge and acquisitions through forming variety of
alliances. In any type of diversification put in
consideration the following rules: a) don’t distance
yourself from customers, b) don’t permit distributors to
shoulder the load of contacting prospects .take time to
learn the intricacies of distributing to local markets. c)
always maintain an ongoing competitor activity

• Positioning is what you do to the mind of the project. It
is the act of designing the company offer and image so
that it occupies a distinct and valued space in the
target customer’s mind. Put the following in your
consideration:
a) Keep focused to monitor a chance that will result in an
opportunity to rank among leaders.
b) Establish a flexible work team: these teams must be
aware of the company vision

Have the authority to take the decisions and have the
proper training
c) Solve customers problems: always an important factor
for survival and long term growth.
d) Look globally: as trade barriers continue to crumble and
opportunities are emerging.
Steps for successful positioning strategy:
1) Identify you product actual position through individual
customer interviews

2)The easiest way to select an ideal position is to accept
your product current position or select a position that
nobody else wants
3) To achieve an ideal position you have two options move
the product to a new position with or without a change in
the product it self or introduce a totally new product and
leave the current one un touched.
4)Select the proper option according to the organization
capabilities

5) Follow up research to track the impact of the product on
the customers mind
Product life cycle: if there is a product which reached the
maturity stage and we want to its sales life we can use
the strategy of life cycle extenders:
1) Promote more frequent usage
2) Find new users
3) Find more uses
4) Find new uses for the product basic material

In general there are three strategies to handle the
difficult maturity stage
1) Market modification: expand the number of users by
converting non users to the product,
And converting competitors customers to your
company.
2) Product modification: utilize quality improvement
To increase the product ‘s functional performance
Such as through durability, reliability and speed

• Add feature improvement that expand the product
versatility, safety and convenience through size, material
additives …etc
• Implement style improvement using shape, packaging
color…etc
Marketing mix modification: related to price ,sales
advertising ..etc

Life cycle stage product price distribution promotion
introduction Offer technically
mature product, keep
mix small
Skim the cream of
price, insensitive
innovators through
high introductory
price
Fill the pipe line to
the consumer use
indirect distribution
through middle men
Create primary
demand for product
category
Spend generously on
extensive and
intensive flight
advertising,
incorporate the
internet in the mix
growth Improve product
,keep mix limited
Adjust price as
needed to meet
competition
Increase product
presence and market
penetration.
Spend substantially
on expansion of
sales volume
maturity Distinguish the
product from
competition.
Capitalize on price
sensitive demand by
further reducing price
Take over
wholesaling function
Yourself by
establishing
distribution centers
Differentiate your
product in the mind of
prospective buyers
Emphasize brand
appeal

Maturity Expand your product
Offering to satisfy
different market
segments
And have your own
sales force call on
competitors
saturation Proliferate your mix
further diversify into
new market
Keep price stable Intensify your
distribution to
increase availability
and exposure
Maintain states quo
,to support market
position
decline Prune your mix
radically
Carefully monitor
prices
Consolidate
distribution and
establish minimum
orders
Reduce advertising
activity to reminder
level

• Product competition: to develop competing products,
focus on the following:
1) Features and benefits: always add unique features and
benefits.
2) Performance : always related to the level at which the
product operates.
3) Acceptance
4) endurance: related to product expected operating life

• Dependability: related to the probability of the product
breaking or mal functioning.
• Appearance: it integrates the product with all its
differentiating components including packaging
• Design: it encompasses the last three factors.
Product mix: a product is considered new when the
prospect or customer perceives it as new thus covering a
range of innovations.

• You can develop your product mix by monitoring the
following: a) review the company strategic direction or
overall product line objectives. thus guarding against
venturing into line segments that are not related to your
core business,
B) Define the market by sales , profit volume, customer
usage, purchasing patterns…etc
C) Determine product development requirement
D) Evaluate competitive offerings

E) Determine the proposed
product’s position : will it
be defending market
niche or offensive to
secure additional market
share…etc.
Product design:
Product
design
Standard
product
Customized
product
Modified
product

• Explore customers needs and problems in two broad
categories : revenue expansion and cost reduction. This
will involve product developers and other non marketing
managers to interpret findings and translate them into
product design solutions.

• New product/service: this involves( innovation,
modification, line extension, diversification,
remerchandising, market extension.)
• To manage your brand consider the following:
• Protect the brand name: a brand ‘s deeper essence is
defined by attributes essence ,culture personality select
from those factors one or more that are distinctive and
not easily duplicated by a competitor.

• Build brand equity: it involves brand awareness, brand
acceptability and brand equity.
• Strengthen your capability to develop brand: try to
increase options to reach additional market segments.
• Develop short and long term brand strategies: to
strengthen brand equity take the following actions: a)
recommend investing in new brands, sustain a
concentrated promotional program to

Maintain high brand awareness, b) define the correct
positioning for each brand in partnership with
distributors. c) develop a strong customer relationship.
Only one of five innovations survives long enough in the
market to become a commercial success. A new product
is considered new when the customer perceives it AS
new. Use a combination of the following approaches to
maintain a steady growth.

category definition nature benefit
modification Altering a product
feature
Same number of
product number and
products
Combining the new
with the familiar
diversification Entering a new
business
New product line
higher number of
products
Spreading risk and
capitalizing on
opportunities
Re merchandising Marketing change to
create new
impression
Same products,
same markets
Generating
excitement and
stimulating sales.
Line extension Adding more variety Same number of
products lines higher
number of products
Segmenting the
market by offering
more choice
Market extension Entering new market Same products new
markets
Broadening the base

• Product audit: it involves line reduction or line
elimination. To take such a decision set up a product
audit committee that can assist in accomplishing the
following:
• 1) determine product long term market potential
• 2)assess the advantages and disadvantages of adding
value to the product
• Alter the product market position compared to that of a
competitors comparable product.

Evaluate the chances of your product being displaced by
another product or technology.
Calculate product contribution to company financial
goals
Judge if the product line is filled out sufficiently to prevent
your customers from shopping else where.
Establishing a product audit program: after establishing a
committee review the performance of each product at
least annualy.

PRODUCT CRITERIA 1 2 3 4 5
What is the product market
potential ? Assign a score based
on dollar value unit volume or
other quantitative measures.
What competitive advantage
might be gained by adding value
,modifying the product or
creating other differentiation
feature and benefits?
What would be gained by
positioning the product differently
to customers and against
competing products?
How much resources would be
available by eliminating the
product?

PRODUCT CRITERIA 1 2 3 4 5
How good are the opportunities to
redeploy the resources to anew
product service or business/
Based on financial calculation of
R.O.I ,profits and other financial
criteria how much is the product
contributing beyond its direct
costs?
What values does the product
have in supporting the sale of
other company products/
Is the product useful in defending a
point of entry against competitors?

• Each criteria is given a score from 1 to 5 (one is low
while five is high ) based on score summation you can
take the decision of keeping or dropping the product.
• To sum this up the steps to implement product/market
strategies are:
1) Identify the frame work for developing product strategies
2) Develop a strategy that provides a competitive
advantage
.

3) Use life cycle extension strategies to revitalize the
products
4) Use product audit to sustain product profitability.

• Pricing must work in
harmony with all the other
strategies
New
product
Skim
praicing
Penetrating
pricing
Psycho
logical
pricing
Follow
pricing
Cost
Plus
pricing

• Skim pricing: it involves pricing at high level to hit the
“cream of the buyers” who are less sensitive to price.
The conditions for weighing such strategy are as follows:
1) Recovering research and development ,equipment and
technology and other start up costs rapidly.
2) The product or service is unique .it is new or in the
introductory stage of the life cycle or serves a small
segment where price is not a major consideration.

3) There is little danger of short term competitive entry
because of patent protection, high entry costs ,high
promotion costs…etc
4) There is need to control demand until production is
geared up.
Penetration pricing: pricing below the prevailing level to
gain market entry or to increase market share. the
conditions for considering this strategy are as follows:

• There is an opportunity to establish a quick foot hold in a
specific market
• Existing competitors are not expected to react to
The price.
• The product or service is a ( me too) entry and you have
achieved a low cost producer capability.
• You hold to the theory that high market share equals
high return on investment .

• Psychological pricing: it means pricing at a level that is
perceived to be much lower than it actually is.
(e.g.99€, 19.47€,1.98€) the conditions for considering
such strategy is:
1) A product is singled out for a special promotion
2) A product will be quoted in writing.
3) The selling price is a multiple of 10,100 …etc
The traditional (9) is not used (7) has come out on top

• Follow pricing: price in relation to industry leaders.
Conditions for considering this strategy are as follows:
1) The organization is small in an industry dominated by
one or two price leaders.
2) Aggressive price fluctuations may result in damaging
price wars.
3) Most products offered don’t have distinguished
features.

• Cost plus pricing: basing price on product costs then
adding on components as administration and profit .the
conditions for using such price are as follows:
• The pricing procedure conforms to governmental,
military or construction regulations
• There are un predictable total costs owing to ongoing
new product development and testing phases.

• A project moves through a series of start and stop
consequences.
• It is considered a product based pricing not a market
based one as it does not put in consideration ( product
line objectives ,concerning profits, target market
objectives, dealing with market position ,profile of
customer segments, current demand for product,
marketing mix strategy…etc)

Established
product
slide down
pricing
Segment
pricing
Flexible
pricing
Pre_ emptive
pricing
Phase_ out
pricing
Loss_ leader
pricing

• Slide down pricing: which moves price down to tap
successive layers of demand . The conditions to
consider such strategy are :
1) The product would appeal to progressively larger
group of users at lower prices in a price elastic market.
2) The organization has adopted a low cost producer
strategy by adhering to efficiencies , which impact
economies of scale in manufacturing ,distribution and
sales.

3) There is need to discourage competitive entry
Segment pricing: pricing the same product differently to
various groups. The conditions to consider such
strategies are :
1) The product is appropriate for several market segments.
2) The product can be modified or packaged at minimal
cost to fit the varying needs of customer groups.
3) The consuming segments are non competitive

And do not violate legal constraints.
Flexible pricing: pricing to meet competitive or market
place conditions. The conditions for considering such
strategy is as follows:
1) There is competitive challenge from imports
2) 2)price variations are needed to create tactical
surprise.
3) There is a need for fast reactions against competitors
attacking the market with penetrating prices.

• Pre emptive pricing: used to discourage competitive
market entry. the conditions for considering such
strategy are as follows:
1) You hold as a strong position for a medium to small
market.
2) You have sufficient coverage of the market and
sustained customer loyalty to cause competitors
To view market as un attractive.

• Phase out pricing: it means pricing high to remove the
product from the line. Conditions for considering such
strategy are as follows:
1) The product has entered the down side of the life cycle
but still used by a few customers
2) Sudden removal of the product from the line would
cause problems.
Loss leader pricing: pricing a product low to attract
buyers for other products is called loss leader pricing.

• Conditions for adapting such technique are:
1) Complimentary products are available that can be sold
in combination with the loss leader at normal price
2) The product is used to draw attention to a total product
line and increase the customer following.

AUCTION PRICING
Ascending bid
auctions
Descending bid
auctions
Sealed-bid
auctions

• Ascending bid auctions: it includes one seller and
numerous buyers. The seller offers a product and the
bidders raise the price until the maximum is reached.
• Descending bid auctions: either one seller and many
buyers or one buyer and many sellers . It begins with
high price, the price is reduced until a bidder accepts the
price.
• Sealed bid auction: prospective suppliers submits a
single bid and cannot know the price or details of the
competing bids .

• FEES: instead of raising a price fees are added this
method faces negative reactions from customers and
may result in customer loss.

Communication
mix
advertising Sales promotion Public relations
Personal
selling
Direct response

• Advertising: the steps of a
successful advertising
campaign are:
Campaign
step
Advertising
activity
Research
activity
Market
analysis
Study
competitors
,positioning,
media,
distribution.
Product
research
Identify
perceived
product
characteristi
cs and
benefits.
Customer
research
Conduct
demographi
c studies

Campaign step Advertising activity Research activity
Customer research Investigate media
,purchasing and
consumption patterns
Set advertising objectives Determine target market,
identify users profile and
exposure goals
Decide on level of
appropriation
Determine total advertising
spending necessary to
support objective
investigate competitor
spending level and media
costs
Formulate advertising
strategy
Develop creative approach
and prepare shopping list of
appropriate media
examine audience profile,
reach, frequency.
Integrate advertising
strategy with overall market
strategy
Make sure of mutual
support of advertising and
marketing mix.

Campaign step Advertising activity Research activity
Develop detailed advertising
budget
break down overall
allocations for media
categories and individual
media
Choose message content
and mode of presentation
Develop alternative
,creative concepts ,copy
and lay outs
Conduct concepts and copy
tests
Analyze legal ramifications Review selected copy with
legal staff
Establish media plan Determine media mix and
schedule
Conduct media research
primarily from secondary
resources.

Campaign step Advertising activities Research activities
Review agency presentation Evaluate the entire
promotion campaign with a
strategic perspective for
approval
Production and traffic Finalize and reproduce
advertisement , buy media
time and space and deliver
ads.
Insert advertisement Actually run advertisement
in selected media
Check whether ads
appeared as agreed and
directed.
Impact control Obtain feed back on
consumer and competitive
reaction.
Review and revision Adjust spending levels Check whether changes
achieved desired result.

• Advertising spending techniques:
1) affordable method: how much a company can afford to
spend which can over or under estimate the amount
needed.
2) Percentage of sales approach: advertising allowance is
tied to expected sales. It neglects current business
needs and discourage long term advertising.
3) Competitive parity method: propose that company match
competitive spending levels.

• Objective and task method: most practical method.
define the advertising objective, identify the task that
must be performed to achieve the objective and finally
estimate the costs of this task. It offers a reliable
assessment transferable into a workable budget.
• Guide lines for advertising:
1) Be aware of product positioning in the market space
2) Maintain a brand personality
3) Don’t bore audience and don’t be impersonal
4) Be factual adopting a problem solving approach
5) Don’t replace the advertisement until developing their full
potential.

• Sales promotion :it is a dynamic complement to
advertising and personals selling. In a more wide
definition: it refers to the activities and or objects that
attempt to encourage sales people ,resellers and
ultimate buyers to cooperate with a manufacturer’s plans
by temporarily offering more value for the money or
providing some special incentive related to specific
product or service.
• In general sales promotion is an incentive to buy while
advertising is a reason to buy

Sales promotion technique advantages disadvantages
Free samples Induce trial, attract new
customer, speed up
adoption
Expensive, lacks precision,
cumbersome.
Free trial Overcome market
resistance
Costly to administrator
Door to door couponing Very selective ,high
redemption rate
Time consuming and needs
careful supervision.
Direct mail couponing High target ability, at home
coverage, high redemption
rate
Costly and dependent on
list quality
News paper couponing Quick, convenient, low cost Low redemption rate
,retailers may complain
,require careful planning.

Technique Advantage Disadvantage
Magazine /supplement
couponing
Targeted audience, effective
coverage ,increase reader
ship
Can become expensive
,slow redemption rate
Money refund Generates new business,
reinforces brand loyalty
Results can be slow,
modest impact
In or near pack premiums Increase product sales,
modest distribution costs
Bonus to loyal buyers,
pilferage problem
Self liquidating premiums Low cost, boosts brand
image
Modest sales impact, may
be too popular
Price pack Moves merchandise, keeps
up visibility
Not selective and may
cheapen brand image

Technique advantage Disadvantage
Contests/Weep stakes No Purchase required,
Increases brand
awareness
Expensive
Modest participation
Trading stamps and
Promotional games
No extra expense for
Consumer Creates store
preference
Consumer boredom
Expensive
Point-of-purchase
displays
Effective stimulation Requires dealer
Co opertion
Warranties Effective in influencing a
Purchase decision
Expensive and labour
Intensive with a product
problem

• PUBLIC RELATIONS: it directly supports corporate or
product promotion and image taking. major tools
involved in public relations include:
1) publications: influencing target groups with published
material such as (annual reports, brochures,
articles…etc)
2) Special events: use conferences , seminars, trade
shows …etc)

3) Sponsor ships: sponsoring special events, association
functions…etc
4) New stories: develop newsworthy items for key media
and provide favorable information about a company
,product…etc
5) speeches: give opportunities to company senior
executives to give talks at meetings , events…etc
6) Public service activities: involve company personnel in
public activities

7) lobbying: influence government officials to defeat
specific types of legislation.
Personal selling: sales people should be trained in
strategic planning and techniques of thinking like
strategists. A sales person should think as a general
manager and act as market director for his territory
Direct marketing: it involves:
1) Direct mailing: using mailing list to send letters
This method permits high level of selectivity and
personalization

2) Catalogue marketing: full line merchandise
catalogues,business to business catalogues…etc thus
providing excellent opportunity to reach global market
3) Tele marketing: use telephone calls and video phones
4) Kiosk marketing: including variety of free standing
structures or carts where vendors sell a variety of
product and service.
5) E-marketing using the internet.
6) Other media news paper ,magazine….etc

• Supply chain evaluation: the supply chains should rank
high in the importance to the organization.
• The supply chain involves long term commitments to
other firms.
• It determines the portion of the market you can reach.
• It affects all other market decisions.

• Supply chain control considers four sets of
circumstances that dictate the search for new
distributors:
1) New marketing efforts such as introducing a new
product or entering a new market
2) Desire to intensify market coverage
3) Need to replace existing distributors
4) Industry changes affecting distribution strategies.
The criteria of choosing the distributors is :

Criteria impact
Financial aspect Choose one with a solid financial
control
Sale organization and performance Sales strength and performance
record
Are important
Number of sales people in the field The more the sales people the more
the coverage

Sales and technical competence Sales people wit sales skills are an
advantage
Quality level
Number of lines
The higher the better
Will I get enough attention?
Compatible products
Competitive product
Tend to be beneficial
Generally avoided
reputation A good reputation is a must
Market coverage
Geographical coverage
Exposure means sales
Avoid overlap and conflicts
Industry coverage
Intensity of coverage
Major used groups must be covered
Infrequent calls means lost business

Inventory and ware housing Ability to deliver products and services
accurately and on time are often decisive
Kind and size of inventory You want the right mix and a willing to
maintain adequate stock
Ware house facilities Storage and order handling must be
suitable to customers
Management
ability
Effective leadership
Competent management
Continuity
enthusiasm
Succession should be assured
Look for enthusiasm and total customer
orientation

• A periodic evaluation must be performed to keep
informed about the performance of distributors. shorten
the supply chain and reduce communication time
between the customer and home office to assure
profitable market conditions.

Entry strategies
Into global
markets
exporting licensing Joint venture
Owned
subsidiaries
Management
contract

Strategy definition Intensity of
commitment
Amount of
investment
Extent of
control
Degree of
profitability
exporting Marketing in
one country
goods
produced in
another
Very limited Possible
investment
in inventory
limited Moderate
due to
transportatio
n cost
licensing Licensor
grants
licensee
right to use
patent
Own
marketing
effort
Virtually
none
Very
restricted
Fixed
royalities
Joint venture Sharing
member ship
with at least
one partner
Equity
capital
portion
Depending
on equity
share
Dependent
on owner
ship ratio
varies

Owned
subsidiary
Firm abroad
100%
company
owned
Strong
commitment
Investment
in plant and
systems
Control over
phases of
operation
Can be
highly
profitable
Management
contract
Managing a
foreign
facility under
contract
Only human
resources
Facility not
owned by
management
firm
Restricted by
contract
moderate

• A strategist treat each market with tailored strategies to
customers needs and distinctive cultures.
• Global markets open through the increasing use
Of the internet and with improved supply chains
The revolution of the internet and electronic reporting
lead to what so called (transnational organizations).
They operate through global network of operations to
deal with the gaps between time zones and cultures.

Each of these strategies has its advantages and
disadvantages but the choice will depend only on the
firm circumstances.

Marketing effectively

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