Published on

Published in: Economy & Finance, Business
1 Comment
No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide
  • Strategy

    1. 1. Strategic Marketing Decisions Learning Outcomes <ul><li>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 </li></ul><ul><li>Identify, compare and contrast strategic options and critically evaluate the implications of strategic marketing decisions in relation to the concept of 'shareholder value’ </li></ul><ul><li>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 </li></ul>
    2. 2. Strategic Marketing Decisions Learning Outcomes <ul><li>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 </li></ul><ul><li>Define and contribute to investment decisions concerning the marketing assets of an organization </li></ul><ul><li>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 </li></ul>
    3. 3. Strategy <ul><li>What is strategy? </li></ul><ul><li>Generic strategies </li></ul><ul><li>Competitive analysis/competitive advantage </li></ul><ul><li>Strategy in a complex & unpredictable world </li></ul><ul><li>Segmentation, Targeting & Positioning </li></ul><ul><li>Value proposition & competitive advantage </li></ul><ul><li>Why does strategy fail? </li></ul>
    4. 4. Strategy <ul><li>Being best at doing things that matter most to customers </li></ul><ul><li>Building shareholder value by achieving superior customer value </li></ul><ul><li>Finding new and better ways of doing things to achieve the above </li></ul><ul><li>Nigel Piercy </li></ul>
    5. 5. From transactions to value Transaction marketing Brand marketing Relationship marketing Value-added marketing
    6. 6. From transactions to value Customer loyalty HIGH LOW Customer sophistication HIGH LOW Transaction Value Relationship Brand Nigel Piercy
    7. 7. Strategic Marketing Decisions … <ul><li>… are concerned with: </li></ul><ul><li>How to create value – for customers and therefore for shareholders </li></ul><ul><li>How to harness the power of the internet </li></ul><ul><li>How to achieve totally integrated marketing effort </li></ul><ul><li>How to engender creativity in the strategy of the company </li></ul><ul><li>Nigel Piercy </li></ul>
    8. 8. Delivering Value-based Marketing <ul><li>Develop deep understanding of customer needs, operating procedures and decision-making processes </li></ul><ul><li>Formulate value propositions that meet customer needs and create differential advantage </li></ul><ul><li>Build long-term relationships with customers so that loyalty and trust is built based on satisfaction and confidence in the supplier </li></ul><ul><li>Understand that delivering superior value to customers requires superior knowledge, superior skills, superior systems, superior marketing assets </li></ul><ul><li>Peter Doyle </li></ul>
    9. 9. What is strategy? <ul><li>Strategy is a … </li></ul><ul><ul><ul><li>… plan </li></ul></ul></ul><ul><ul><ul><li>… pattern </li></ul></ul></ul><ul><ul><ul><li>… position </li></ul></ul></ul><ul><ul><ul><li>… perspective </li></ul></ul></ul><ul><ul><ul><li>… ploy </li></ul></ul></ul><ul><li>Mintzberg et. al. </li></ul>
    10. 10. What is strategy? <ul><li>Strategy is a … </li></ul><ul><ul><ul><li>… plan - a consciously intended course of action </li></ul></ul></ul><ul><ul><ul><li>… pattern – a stream of consistent behaviours </li></ul></ul></ul><ul><ul><ul><li>… position – locating the organisation within the environment </li></ul></ul></ul><ul><ul><ul><li>… perspective – an ingrained way of perceiving the world </li></ul></ul></ul><ul><ul><ul><li>… ploy – a specific manoeuvre to outwit competitors </li></ul></ul></ul><ul><li>Mintzberg et. al. </li></ul>
    11. 11. Generic Strategies <ul><li>Cost leadership strategy </li></ul><ul><li>Differentiation strategy </li></ul><ul><li>Focus strategy </li></ul><ul><li>Michael Porter </li></ul>
    12. 12. 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
    13. 13. Strategy <ul><li>Ansoff Growth Matrix </li></ul>
    14. 14. Strategy <ul><li>Rational/formal approach </li></ul><ul><li>v </li></ul><ul><li>Emergent strategy approach </li></ul>
    15. 15. Rational/formal approach <ul><li>Linear approach, distinct steps </li></ul><ul><li>Hierarchal structure of decisions </li></ul><ul><li>Uses models, planning frameworks </li></ul><ul><li>Detailed, explicit strategies </li></ul><ul><li>Chief Executive responsible for whole process </li></ul>
    16. 16. Emergent strategy approach <ul><li>Iterative process </li></ul><ul><li>Consists of many small decisions taken throughout the organisation </li></ul><ul><li>These small decisions “emerge” into an articulated strategy </li></ul><ul><li>Requires empowerment </li></ul><ul><li>Requires systematic analysis throughout the organisation </li></ul>
    17. 17. Strategy in a complex & unpredictable world <ul><li>Strategy Safari </li></ul><ul><li>a guided tour through the wilds </li></ul><ul><li>of strategic management </li></ul><ul><li>Mintzberg, Ahlstrand & Lampel (1998) </li></ul>
    18. 18. Segmentation, Targeting & Positioning <ul><li>Segmentation </li></ul><ul><ul><ul><li>Choose variables on which to segment </li></ul></ul></ul><ul><ul><ul><li>Create segments for the market </li></ul></ul></ul><ul><ul><ul><li>Profile the segments & understand their needs </li></ul></ul></ul><ul><li>Targeting </li></ul><ul><ul><ul><li>Devise targeting strategy </li></ul></ul></ul><ul><ul><ul><li>Prioritise segments & choose which to serve </li></ul></ul></ul><ul><li>Positioning </li></ul><ul><ul><ul><li>Understand the target segment perceptions </li></ul></ul></ul><ul><ul><ul><li>Doole & Lowe (2005) </li></ul></ul></ul>
    19. 20. Segmentation <ul><li>Definition </li></ul><ul><li>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. </li></ul><ul><li>Market segments should be formed in such a way that differences between buyers within each segment are as small as possible. </li></ul><ul><li>Thus, every segment can be addressed with an individually targeted marketing mix. </li></ul>
    20. 21. Segmentation <ul><li>Bases for segmentation </li></ul><ul><li>Geographic </li></ul><ul><li>Demographic </li></ul><ul><li>Geo-demographic </li></ul><ul><li>Psychographic (Lifestyle; AIO analysis) </li></ul><ul><li>Behaviour (esp. benefits sought) </li></ul>
    21. 22. Targeting <ul><li>Evaluation of potential target segments: </li></ul><ul><li>Measurable? </li></ul><ul><li>Identifiable? </li></ul><ul><li>Accessible? </li></ul><ul><li>Substantial? </li></ul><ul><li>Meaningful? </li></ul>
    22. 23. 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
    23. 24. Positioning <ul><li>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 </li></ul>
    24. 25. 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
    25. 26. Steps to positioning <ul><li>Define the segments in a particular market </li></ul><ul><li>Decide which segments to target </li></ul><ul><li>Understand what the target consumers expect and believe to be the most important considerations when deciding on the purchase </li></ul><ul><li>Develop a product (or products) that caters specifically for these needs and expectations </li></ul><ul><li>Evaluate the positioning and images, as perceived by the target customers, of competing products in the selected market segments </li></ul><ul><li>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 </li></ul><ul><li>Inform target customers about the product (promotion) </li></ul><ul><li>Dibb et al </li></ul>
    26. 27. Repositioning - examples <ul><li>Lucozade </li></ul><ul><li>Skoda </li></ul><ul><li>Samsung </li></ul><ul><li>Conservative Party? </li></ul>
    27. 28. Competitive Stances <ul><li>Leaders </li></ul><ul><li>Challengers </li></ul><ul><li>Followers </li></ul><ul><li>+ </li></ul><ul><li>Pioneers </li></ul><ul><li>Nichers </li></ul>
    28. 29. Sources of competitive advantage <ul><li>Superior product benefit </li></ul><ul><li>Perceived advantage (through communication/branding) </li></ul><ul><li>Low cost operations </li></ul><ul><li>Legal advantage (e.g. patents, copyrights) </li></ul><ul><li>Superior contacts </li></ul><ul><li>Superior knowledge (of customers/markets, science/technology) </li></ul><ul><li>Scale advantages </li></ul><ul><li>Offensive attitudes (competitive toughness & determination to win) </li></ul><ul><li>Hugh Davidson (1987) Offensive Marketing </li></ul>
    29. 30. Strategic Choice Strategic Choice <ul><li>GENERIC STRATEGIES </li></ul><ul><li>Cost leadership </li></ul><ul><li>Differentiation </li></ul><ul><li>Focus / niche </li></ul><ul><li>COMPETITIVE </li></ul><ul><li>ADVANTAGES </li></ul><ul><li>PRODUCT/MARKET STRATEGY </li></ul><ul><li>Market penetration </li></ul><ul><li>Product development </li></ul><ul><li>Market development </li></ul><ul><li>Diversification </li></ul><ul><li>ALTERNATIVE METHODS </li></ul><ul><li>Organic / Internal development </li></ul><ul><li>Acquisition </li></ul><ul><li>Joint development </li></ul><ul><li>Alliances </li></ul>Adapted from Drummond & Ensor, Johnson & Scholes and others How to Compete Direction of Growth Method of Growth COMPETITIVE POSITIONS Challengers Defenders Leaders Nichers