COURSE CODE COURSE NAME Task brief & rubrics BAT 212 The

COURSE CODE COURSE NAME Task brief & rubrics
BAT 212 The Business of Tourism
Task: 1 Summative assignment
Including:
CASE STUDY (Midterm)
- Select a tourist company
- Describe it (location, segment economic impact, socio-cultural
impact, environmental impact, …)
- Exposes recent effects of covid19 outbreak to the company
- Analyze destination (urban, coastal, rural, cultural, island
tourism, leisure, heritage, sport…)
- Exposes structure of the company and the involvement of
public sector/administration
- Exposes system of selling service and products
- Assess the economic impact of the company on its
environment
- Describe the use of digital technology in communication,
marketing, and advertising issues
Formalities:

excluded of the total wordcount.
al 12,5 pts.
-text References and the Bibliography must be in
Harvard’s citation style.
Submission: Week (6) – Via Moodle (Turnitin). Delivering date:
7th November at 23:59PM CEST
Weight: This task is a 40% of your total grade for this subject.
It assesses the following learning outcomes:
product/service
its local environment, and national and international, if case
influences of tourism demand
tourist destination
Rubrics

Exceptional 90-100 Good 80-89 Fair 70-79 Marginal fail 60-69
Knowledge &
Understanding
(15%)
Student demonstrates
excellent understanding of
key concepts and uses
vocabulary in an entirely
appropriate manner.
good understanding of the
task and mentions some
relevant concepts and
demonstrates use of the
relevant vocabulary.
Student understands the
task and provides minimum
theory and/or some use of
vocabulary.
Student understands the task
and attempts to answer the
question but does not
mention key concepts or uses
minimum amount of relevant
vocabulary.
Application (30%) Student applies fully
relevant knowledge from
the topics delivered in
class.

Student applies mostly
class.
Student applies some
class. Misunderstanding
may be evident.
Student applies little relevant
knowledge from the topics
delivered in class.
Misunderstands are evident.
Critical Thinking
(30%)
Student critically assesses
in excellent ways, drawing
outstanding conclusions
from relevant authors.
Student critically assesses
in good ways, drawing
conclusions from relevant
authors and references.
Student provides some
insights but stays on the
surface of the topic.
References may not be
relevant.

Student makes little or none
critical thinking insights, does
not quote appropriate
authors, and does not
provide valid sources.
Communication
(25%)
Student communicates
their ideas extremel y
clearly and concisely,
respecting word count,
grammar and spellcheck
their ideas clearly and
concisely, respecting word
count, grammar and
spellcheck
their ideas with some
clarity and concision. It
may be slightly over or
under the wordcount limit.
Some misspelling errors
may be evident.
Student communicates their
ideas in a somewhat unclear
and unconcise way. Does not
reach or does exceed
wordcount excessively and
misspelling errors are
evident.

www.euruni.edu
Johan Reyneke
25 October 2021
Strategic Marketing
BCO211
www.euruni.edu
Assignment 1
Recap from last week
Assignment 2
Environmental and ethical aspects of
marketing
Next week
1
2
3
4
5

Todays Lecture
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• Option 1: Virtual
• Option 2: Another date
Lecture 1 November
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Assignment 1 feedback
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• Strategic targeting
• Groups customers based on the value that the company can
create (to
satisfy the segments needs) and the value they can receive from
that
segment.
• Tactical targeting
• Groups customers according to their profile characteristics.

• Two key decisions are key:
• Identify the needs that the company can fulfil better than the
competition.
• Identify effective and cost efficient ways to reach these
customers
Segment based targeting
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All customers
Strategic segmentation (Value based)
Strategic targeting
(Value based)
Tactical
segmentation.
(Profile based)
Tactical targeting.
(Profile based)
Channel
A Channel
B
Channel
C

Chernev, 2020
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• Criteria:
• Has to be relevant to the targeting strategy.
• Similarity (more segments means more similarity but ads
communication
job)
• Comprehensiveness (need to include all potential customers)
* Final thought: segmentation can be done based on many
different
criteria. Keep in mind that you are looking for a similar
response from each
segment.
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• What is a value proposition?
• “The customer value proposition articulates the specific
benefits and costs
that a company’s offering aims to create for its target
customers.”
Chernev, 2020.

Value proposition
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benefits and costs
customers.”
Chernev, 2020.
• Understand the way customers form value judgements
• ID key competitors
• ID points of parity and/or differentiation
• Create a sustainable competitive advantage
Value proposition
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• “Value is in the eye of the beholder”
• Value is intangible and emerges when the customer interacts
with the
product/service.
• The greater the fit between the offering and the customer
needs the

greater the customer value created.
Value proposition
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• Three types of value:
• Functional – defined by benefit and cost of the performance of
a product
(e.g. reliability, ease of use, customisation, packaging, etc.)
• Psychological – How the benefit and cost makes a customer
feel (e.g. joy,
driving a new car, peace of mind with safety and security
products,
refreshment – Coca-Cola)
• Monetary – defined by the monetary benefit and costs. (e.g.
fees, price,
discounts, trade in value, maintenance costs, etc.)
Value proposition
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• ID key competitor value propositions
• Identifying competitor value propositions is crucial in being
able to

develop a superior value proposition.
• As discussed before we need to look further than just direct
competitors.
• Hilton Hotels example.
• Coca – Cola example
• To identify key competitors look through the eyes of the
market: What
are my needs?, if Hilton did not exist what would I choose
instead?
Value proposition
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• Once you know who your key competitors are you can
compare your value
proposition and determine point of difference and points of
parity.
• Points of parity (PoP) – the offering is equal to the
competitors as
perceived by customers. (e.g. screen size, durability, volume,
battery life)
• Points of dominance (PoD) – the offering is superior to
competitors and
forms part of the companys’ competitive advantage)
• Points of compromise (PoC) – the offering is inferior to the
competitor

offering and will form part of the competitors competitive
advantage.
Value proposition
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Value proposition
Iphone 13 Galaxy S21
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• Creating PoD’s on existing or “mandatory” attributes can
become more
difficult.
• Easier to introduce a new attribute (e.g. Pepsi lemon lime
Sierra Mist
only natural ingredients, Coke recyclable plant based bottles,
etc)
• Brand starts playing a very important role in differentiation
and PoD.
Value proposition
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• Value proposition – define all the product benefits and costs
• Positioning – focusses on the on the primary benefit.
e.g: BMW – Ultimate driving experience (Designed for driving
pleasure)
Volvo – Safety (For people by people.)
Toyota – Reliability (Let’s go places)
Ferrari – Speed
Rolls Royce – Luxury (Inspiring greatness)
Value proposition vs positioning
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• Benefit laddering – benefits customer values as important and
those which
they value as primary.
• Single – benefit positioning
• Multiple – benefit positioning
• Holistic positioning
Positioning
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those which

Positioning
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• Creating a sustainable positioning
Positioning
Positioning
Monetary
Functional
Psychological
A
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at
e

S
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ad
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Chernev, 2020.
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• Customer value judgements happen against a reference point.
• Which reference points can you think of?

Positioning
Chernev, 2020.
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• Needs based – Save money. Live better. (Wallmart)
• Category based – Sheer driving pleasure (BMW)
• User based – Choice of a new generation (Pepsi)
• Competitive framing – The best a man can get (Gillette)
• Product based - differentiates amongst your own product set
(Five is better
than three (mach5 vs Mach 3)
Positioning
Chernev, 2020.
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• Structuring your positioning statement you need to consider:
– Target market
– Frame of reference

– Primary benefit
Positioning
Chernev, 2020.
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Positioning products and services
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• Aligning attributes with customer needs
• Creating superior value
Key product decisions
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Attribute 1
Attribute 2
Attribute 3

Attribute 4
Attribute 5
Attribute 6
Benefit 1
Benefit 2
Benefit 3
Benefit 4
Benefit 5
Benefit 6
Product
Product attributes Customer needs
Functional
benefits
Psychological
benefits
Monetary
benefits
Chernev, 2020
www.euruni.edu

• Key decision that needs to be made regarding product
attributes:
– Performance
– Consistency
– Reliability
– Durability
– Compatibility (standard and existing complementar y
offerings)
– Ease of use
– Degree of customization
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• Packaging as a tool
• Visibility
• Differentiation
• Value transparency
• Consumption impact
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Packaging as a tool
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Packaging as a tool
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Packaging as a tool
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• There are many obvious differences between them
• Some fundamental differences are:
– Ownership
– Separability
– Variability
• Key service decisions are the same as products except for
durability:
The differences between products and services
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• Key decision that needs to be made regarding service
attributes:
– Performance
– Consistency
– Reliability
– Compatibility (standard and existing complementary
offerings)
– Ease of use

Key service decisions
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• Product life cycle a visual aid in measuring where products
are in the journey.
Product life cycle
Introduction Growth Maturity Decline
S
al
es
Time
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• Product life cycle point of interest.
Product life cycle
S
al
es
Time

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Product life cycle
S
al
es
Time
Innovation, product
diversification
Introduction
Growth Maturity
Introduction
Growth Maturity
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Product life cycle

Betanews.com
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• BCG matrix
• What info does the BCG matrix aim to provide?
Micro environment
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Micro environment
BCG Matrix, Casetudyhelp.com
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Micro environment
Stars
• The hope is that stars become the next cash cows.
Sustaining the business unit's market leadership may
require extra cash,
• When growth slows, stars become cash cows
• Market Growth Share
Question Marks
• Growing rapidly and consume large amounts of cash,
• Low market shares they do not generate much cash.

• Potential to gain market share and become a star, and
eventually a cash cow when the market growth slows.
• If not succeed in becoming the market leader, will
degenerate into a dog when the market growth
declines.
Cash cows
• Units with high market share in a slow-growing industry.
• Generate cash
• Regarded as staid and boring, in a "mature" market,
• To be "milked" continuously with as little investment as
possible, in an industry with low growth.
Dogs
• These units typically "break even",
• A break-even unit provides the social benefit of
providing jobs and possible synergies that assist other
business units, Dogs, it is thought, should be sold off
M
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ha
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Relative market shareHigh
H
ig
h
Low
Lo
w
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Micro environment
Stars Question Marks
Cash cows Dogs
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ro
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th

S
ha
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H
ig
h
Low
Lo
w
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Micro environment
Cash cows Dogs
M
ar
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G
ro

w
th
S
ha
re
H
ig
h
Low
Lo
w
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Micro environment
Cash cows Dogs
M
ar
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G

ro
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th
S
ha
re
H
ig
h
Low
Lo
w
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• Ansoff matrix will be
used in your
planning for the
future strategy .
• Consider it against
the BCG.
Micro environment

Ansoff growth matrix
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Micro environment
BCG ANSOFF
1 Question marks: High growth
consumes capital
Product development: R&D,
modifications
2 Stars: Strive for market leadership Market penetration,
increase quality
productivity, marketing
3 Cash cows: high market share slow
growth
Market development: existing
product to new markets
4 Dogs: sell or divest Diversification: Develop new
products for new markets
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Micro environment

Cash cows Dogs
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H
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Low
Lo
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E
xi
st

in
g
Existing
N
ew
New
Products
M
ar
ke
ts
Market
penetration
or expansion
Product
development
Diversification
Market
development
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Assignment 2 Launch

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• Individual assignment
• Identify and analyse the market segments, value proposition,
positioning
and competitive advantage of the company or brand.
• Continuing with the company or brand that you selected for
Assignment 1,
analyse their market segmentation, the value proposition
offered for each segment and which products and/or services
they
have aligned to the relevant segments. Identify the positioning
and
competitive advantage they currently employ and the currently
life
cycle stage they are in for each product and segment. Identify
ethical
and sustainability issues and/or opportunities.
Assignment 2 Launch
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• Your table of contents should include:
• Title, executive summary, summary from Assignment 1, body
of work, summary,
references.

• The task should be completed as a professional report and
submitted (uploaded) in
pdf format.
• Wordcount: 2000
• Cover, Table of Contents, References and Appendix are
excluded of the total
wordcount.
• Font: Arial 12,5 pts.
• Text alignment: Justified.
• The in-text References and the Bibliography must be in
Assignment 2 Launch
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• Deadline: 7 November 2021 by 23h59 – Via Moodle
(Turnitin).
Assignment 2 Launch
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positioning

Assignment 1,
they
and
life
ethical
Assignment 2 Guide
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• Strategic targeting
• Groups customers based on the value that the company can
create (to
satisfy the segments needs) and the value they can receive from
that
segment.
• Tactical targeting
• Groups customers according to their profile characteristics.
• Two key decisions are key:
• Identify the needs that the company can fulfil better than the
competition.
• Identify effective and cost efficient ways to reach these
customers

www.euruni.edu
All customers
Strategic segmentation (Value based)
Strategic targeting
(Value based)
Tactical
segmentation.
(Profile based)
Tactical targeting.
(Profile based)
Channel
A Channel
B
Channel
C
Chernev, 2020
www.euruni.edu

positioning
Assignment 1,
they
and
life cycle
stage they are in for each product and segment. Identify ethical
and
sustainability issues and/or opportunities.
Assignment 2 Guide
www.euruni.edu
benefits and costs
customers.”
Chernev, 2020.
• ID key competitors
• ID points of parity and/or differentiation

• Create a sustainable competitive advantage
Value proposition
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• Medium
• Offer
• Journey
Marketing Strategy
Target
Market 1
Target
Market 2
Target
Market 3
Value
Proposition 1
Value
Proposition 2
Value
Proposition 3
Tactics Tactics Tactics
• Medium
• Offer

• Journey
• Medium
• Offer
• Journey
www.euruni.edu
positioning
Assignment 1,
they
and
life
ethical and
Assignment 2 Guide
www.euruni.edu
• Value proposition – define all the product benefits and costs

• Positioning – focusses on the on the primary benefit.
e.g: BMW – Ultimate driving experience (Designed for driving
pleasure)
Volvo – Safety (For people by people.)
Toyota – Reliability (Let’s go places)
Ferrari – Speed
Rolls Royce – Luxury (Inspiring greatness)
Value proposition vs positioning
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those which
Positioning
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• Creating a sustainable positioning
Positioning
Positioning
Monetary

Functional
Psychological
A
bi
lit
y
to
c
re
at
e
S
us
ta
in
ab
le
C
om
pe
tit
iv

e
ad
va
nt
ag
e
Chernev, 2020.
www.euruni.edu
• Needs based – Save money. Live better. (Wallmart)
• Category based – Sheer driving pleasure (BMW)
• User based – Choice of a new generation (Pepsi)
• Competitive framing – The best a man can get (Gillette)
• Product based - differentiates amongst your own product set
(Five is better
than three (mach5 vs Mach 3)
Positioning
Chernev, 2020.

www.euruni.edu
Attribute 1
Attribute 2
Attribute 3
Attribute 4
Attribute 5
Attribute 6
Benefit 1
Benefit 2
Benefit 3
Benefit 4
Benefit 5
Benefit 6
Product
Product attributes Customer needs

Functional
benefits
Psychological
benefits
Monetary
benefits
Chernev, 2020
www.euruni.edu
• Key decision that needs to be made regarding product
attributes:
– Performance
– Consistency
– Reliability
– Durability
– Compatibility (standard and existing complementary
offerings)
– Ease of use
www.euruni.edu

positioning
Assignment 1,
they
and
life
ethical and
Assignment 2 Guide
www.euruni.edu
• Product life cycle a visual aid in measuring where products
are in the journey.
Product life cycle
S
al
es
Time

www.euruni.edu
Product life cycle
S
al
es
Time
www.euruni.edu
Product life cycle
S
al
es
Time
Innovation, product
diversification
Introduction

Growth Maturity
Introduction
Growth Maturity
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Micro environment
Stars
• The hope is that stars become the next cash cows.
Sustaining the business unit's market leadership may
require extra cash,
• When growth slows, stars become cash cows
• Market Growth Share
Question Marks
• Growing rapidly and consume large amounts of cash,
• Low market shares they do not generate much cash.
• Potential to gain market share and become a star, and
eventually a cash cow when the market growth slows.
• If not succeed in becoming the market leader, will
degenerate into a dog when the market growth
declines.
Cash cows
• Units with high market share in a slow-growing industry.
• Generate cash
• Regarded as staid and boring, in a "mature" market,
• To be "milked" continuously with as little investment as

possible, in an industry with low growth.
Dogs
• These units typically "break even",
• A break-even unit provides the social benefit of
providing jobs and possible synergies that assist other
business units, Dogs, it is thought, should be sold off
M
ar
ke
t
G
ro
w
th
S
ha
re
H
ig
h
Low

Lo
w
www.euruni.edu
• Ansoff matrix will be
used in your
planning for the
future strategy .
• Consider it against
the BCG.
Micro environment
Ansoff growth matrix
www.euruni.edu
Micro environment
Cash cows Dogs
M
ar
ke
t
G

ro
w
th
S
ha
re
H
ig
h
Low
Lo
w
E
xi
st
in
g
Existing
N
ew
New

Products
M
ar
ke
ts
Market
penetration
or expansion
Product
development
Diversification
Market
development
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positioning
Assignment 1,
they

and
life
ethical
Assignment 2 Guide
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Environmental and ethical aspects
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• CSR
• Green washers, green branders and green growers
• Ethics in the marketing mix
• Ethics in the promotional mix
Environmental and ethical aspects of
marketing
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• UN Global Compact
• ESG
• Triple bottom line
• Corporate governance

• Ethics
• When you think about this topic what comes to mind?
Corporate social responsibility
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• Human Rights
• Principle 1: Businesses should support and respect the
protection of internationally
proclaimed human rights; and
• Principle 2: make sure that they are not complicit in human
rights abuses.
• Labour
• Principle 3: Businesses should uphold the freedom of
association and the effective
recognition of the right to collective bargaining;
• Principle 4: the elimination of all forms of forced and
compulsory labour;
• Principle 5: the effective abolition of child labour; and
• Principle 6: the elimination of discrimination in respect of
employment and occupation.
CSR – UN Global Compact 10 Principles

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• Environment
• Principle 7: Businesses should support a precautionary
approach to environmental
challenges;
• Principle 8: undertake initiatives to promote greater
environmental responsibility; and
• Principle 9: encourage the development and diffusion of
environmentally friendly
technologies.
• Anti-Corruption
• Principle 10: Businesses should work against corruption in all
its forms, including extortion
and bribery.
CSR – UN Global Compact 10 Principles
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www.euruni.edu
• Firms should try to meet the triple bottom line:
– Environmental Protection

– Economic Development
– Community Building
• In a manner that will enable the next generation to
enjoy the fruits of this generation’s labour
People, Planet, Profit.
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• Fail to disaggregate the different companies to which the
norms apply and impose
on many companies duties that they cannot possibly discharge.
• Most companies find themselves under immense pressure to
satisfy
domestic and international codes (as well as voluntary rules set
forth by industry
organization)
• All firms, operating under the Constitution and the new
Companies Act are asked
to protect the environment, to ensure economic growth and to
promote
well-being of the communities in which companies operate,
• The vast majority cannot – by design and even with the best
intent – make
good on the promise and the premise of CSR I
• Few meet the high threshold set by all the codes but ALL feel
they must talk
the talk. They don’t necessarily walk the walk.

• Three categories Greenwashers (talk the talk), Green branders
(talk the talk)
Greengrowers (Walk the walk).
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• Companies commit themselves to following various codes and
consign company
funds to ventures that may or may not diminish carbon
footprints, create new jobs
or make the lives of some community members discernibly
better
• Efforts of such entities do not form a part of core corporate
strategy.
• Motivations for greenwashing range from advertising, to
reduced government
regulation, to enhanced community relations to esprit de corps
(moral of the
group) within the firm.
• Greenwashers view CSR I as an operating cost and not a
source of sustainable
profit
Greenwashers
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• For Greenbranders, CSR compliance constitutes an operating
cost – but
an operating cost that serves the bottom line.
• Does however form part of the core strategy.
• To the extent that CSR efforts form a successful part of a
greenbrander’s
marketing campaign, they are a source of sustainable profit. Felt
by the
customer in a sense where they feel they are contributing to
something
good when they make the purchase.
Green branders
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• CSR as part of their core business.
• Profit is to be had by making good on the often conflicting
demands of
sustainable development
• Generate new technologies or new business models that enable
them to
produce products and services that consumers want in a manner
consistent with CSR best practices.
Greengrowers
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• Recommended reading:
• SAGE Publications (2012) SAGE Brief Guide to Marketing
Ethics.
Thousand Oaks, Calif: SAGE Publications, Inc. Available at:
https://search.ebscohost.com/login.aspx?direct=true&db=nlebk
&AN=474
610&site=ehost-live (Accessed: 25 October 2021)
• Available in the Ebscohost library
Ethics in the marketing mix
SAGE Publications, 2012
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• Marketing ethics is the systemic study of how moral standards
are applied
to marketing decisions, behaviour and institutions.
• Marketing ethics is a sub set of business ethics.
• Most marketing ethics complaints revolve around deceptive,
unfair or
exploitive advertising and communication.
“Normative marketing practices might be defined as those that
emphasize
transparent, trustworthy, and responsible personal and/or
organizational
marketing policies and actions, and exhibit integrity as well as
fairness to

consumers and other stakeholders.”
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• Examples: selling cigarettes or alcohol to teenagers,
promoting violence
orientated video games, pricing products that exploit
unsuspecting
customers, bluffing with negotiations with suppliers
intentionally
misleading copy, making false claims etc.
• Other?
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• Marketing segmentation: ethical issue around children, elderly
and
impoverished. Ethical question about whether they are
“equipped” to
participate in the market.
• E.g. marketing to children, toys, sugared food and drinks,

video games
• Young children differentiating between adverts and reality.
• Older children understanding the influence of lifestyle
adverts.
Ethics in the marketing mix - segmentation
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• Collection of data from children younger than 13 – ethical
issues in the US.
• Marketing to the elderly face ethical questions around
fraudulent or false
claims.
• Eg. Financial products, vacation packages, insurance products,
prescription drugs.
• Digital ”literacy” being exploited.
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• Collection of data of a private and sensitive nature is being
used to exploit
customers (not only the vulnerable.)

Ethics in the marketing mix – market
research
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• Product safety (especially to children)
• “Safe for their intended use”
• Psychological safety?
• Product counterfeiting.
• Counterfeiting costs US companies $450billion a year.
• Music, movies, clothing, watches.
• Captures the goodwill and brand equity that a brand has
created and
transferring it to knockoff product.
• Two elements: intellectual theft and dishonest presentation to
customers.
Ethics in the marketing mix – product
marketing
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• Physical and natural environment impact
• Waste from products take many forms: packaging, disposal of
liquids

(chemicals & detergents) that harm the environment, disposal of
medical
waste.
• The effects of the disposable lifestyle.
• Marketers solving the effect on the environment ads a
premium to the
price.
• Externality costs: not carried by the product or the consumer
but by
society. (Beer bottles in the park, dumping of waste etc)
Ethics in the marketing mix – product
marketing
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• Fair pricing is difficult to manage
• Price fixing – collusion (basic foods example)
• Price discrimination to distributors or stockists
• Pay day loan stores example (the impoverished and financially
vulnerable)
Ethics in the marketing mix – price
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• Various ethical guidelines in each country
• Most adverts are legal but still raise moral questions (eg
handgun ad in
teenage readership magazine)
• We will discuss this in more detail later.
Ethics in the marketing mix – advertising
www.euruni.edu
• The foundations of all Ad Standards Codes are based on the
principles
that:
a) Advertising is legal, decent, honest and truthful;
b) Ads are prepared with a due sense of social responsibility;
c) Ads conform to the principles of fair competition;
d) Ads don’t impair public confidence in advertising.
https://www.easa-alliance.org/ad-standards/what-are-ad-
standards/codes
www.euruni.edu

• Most adverts are legal but still raise moral questions (eg
handgun ad in
teenage readership magazine)
• Competitive advertising.
• We will discuss this in more detail later.
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Examples of ethical fairness
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Competitive
advertising
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Competitive advertising
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www.euruni.edu
www.euruni.edu
www.euruni.edu
www.euruni.edu
www.euruni.edu
www.euruni.edu
• Ads for Dannon's popular Activia brand
yogurt landed the company with a class
action settlement of $45 million in 2010,
according to ABC News. The yogurts were
marketed as being "clinically" and
"scientifically" proven to boost your immune
system and able to help to regulate digestion.

• The Activia ad campaign, fronted by actress
Jamie Lee Curtis, claimed that the yogurt had
special bacterial ingredients. As a result, the
yogurt was sold at 30% higher prices than
other similar products. However, the
Cleveland judge overseeing the case said that
these claims were unproven.
False claims example
Businessinsider.com, 2016
www.euruni.edu
Energy drinks company Red Bull was sued in 2014 for
its slogan "Red Bull gives you wings." The company
settled the class action case by agreeing to pay out a
maximum of $13 million — including $10 to every US
consumer who had bough the drink since 2002.
The tagline, which the company has used for nearly
two decades, went alongside marketing claims that
that the caffeinated drink could improve a consumer's
concentration and reaction speed.
Beganin Caraethers was one of several consumers who
brought the case against the Austrian drinks company.
He said he was a regular consumer of Red Bull for 10
years, but that he had not developed "wings," or shown
any signs of improved intellectual or physical abilities.

www.euruni.edu
New Balance was accused of false advertising in 2011
over a sneaker range that it claimed could help wearers
burn calories, according to Reuters. Studies found that
there were no health benefits from wearing the shoe.
The toning sneaker claimed to use hidden board
technology and was advertised as calorie burners that
activated the glutes, quads, hamstrings and calves.
Plaintiffs in the lawsuit claimed to have been harmed
and misled by the sneaker company.
On August 20, 2012, New Balance agreed to pay a
settlement of $2.3 million, according to The
Huffington Post.
www.euruni.edu
In 2009, an Olay ad for its Definity eye cream showed
former model Twiggy looking wrinkle-free — and a
whole lot younger than her then-60 years. It turned out
the ads were retouched, according to The Guardian.
The British advertising regulator ASA banned the ad,
after Liberal Democrat lawmaker Jo Swinson gathered

more than 700 complaints against it. The digitally-
altered spots were deemed to give a "misleading
impression of the effect the product could achieve."
Olay's parent company Procter & Gamble responded
that it was "routine practice to use post-production
techniques to correct for lighting and other minor
photographic deficiencies before publishing the final
shots as part of an advertising campaign."
www.euruni.edu
Millions of people lit up when Classmates.com sent
them an email saying old friends were trying to contact
them, promising to rekindle old friendships and flames
if subscribers upgraded to a "Gold" membership.
But with the upgrade, the expected reunions never
came. It turns out the social networking site used the
ploy to get users to give up extra dollars. In 2008, one
miffed user filed a suit alleging the "deceptive" emails
were false advertising. Classmates.com eventually
agreed to pay out a $9.5 million settlement —$3 for
every subscriber who fell for the dirty trick — to resolve
the case, according to the Business Journal.
However, the website did not learn from its mistakes
and in 2015 it was given another $11 million in fines,
according to Consumer Affairs.

www.euruni.edu
• Consumer rights
• UN principles for good business practices
1. Fair and equitable treatment. Businesses should deal fairly
and honestly
with consumers at all stages of their relationship, so that it is an
integral part
of the business culture.
2. Commercial behaviour. Businesses should not subject
consumers to illegal,
unethical, discriminatory or deceptive practices, such as abusive
marketing
tactics, abusive debt collection or other improper behaviour that
may pose
unnecessary risks or harm consumers.
3. Disclosure and transparency. Businesses should provide
complete,
accurate and not misleading information regarding the goods
and services,
terms, conditions, applicable fees and final costs to enable
consumers to take
informed decisions.
United Nations, 2016

www.euruni.edu
• Consumer rights
• UN principles for good business practices
4. Education and awareness-raising. Businesses should, as
appropriate,
develop programmes and mechanisms to assist consumers to
develop the
knowledge and skills necessary to understand risks, including
financial risks,
to take informed decisions and to access competent and
professional advice
and assistance
5. Protection of privacy. Businesses should protect consumers’
privacy
through a combination of appropriate control, security,
transparency and
consent mechanisms relating to the collection and use of their
personal data.
6. Consumer complaints and disputes. Businesses should make
available
complaints-handling mechanisms that provide consumers with
expeditious,
fair, transparent, inexpensive, accessible, speedy and effective
dispute
resolution without unnecessary cost or burden.
United Nations, 2016

www.euruni.edu
• Advertising ethics
• Formulating marketing mix strategies
– Elements of the marketing mix
– Budgeting, financial and production resources
Next week:
www.euruni.edu
www.euruni.edu
Johan Reyneke
4 October 2021
Strategic Marketing
BCO211
www.euruni.edu
Todays lecture

Situation Analysis
The 5 C’s
Market analysis
1
2
3
4
5
Company Analysis
Industry Analysis
Macro environment analysis
Profitability and productivity analysis
6
7
8
9
Todays Lecture
Marketimg Audit10

www.euruni.edu
What is strategy?
- and why is it
important?
www.euruni.edu
Strategy Definitions:
• “Strategy: a plan, method or series of actions designed to
achieve a
specific goal or effort.” – Wordsmyth Dictionary
• “Strategy is the direction and scope of an organization over
the long term
which achieves advantage in a changing environment through its
configuration of resources and competencies with the aim of
fulfilling
stakeholder expectations.” – Gerry Johnson, Kevin Scholes and
Richard
Whittington
What is strategy?
www.euruni.edu

www.euruni.edu
Marketing strategy role?
www.euruni.edu
Corporate
Strategy
Marketing
Strategy
Brand Strategy
Communication
Strategy
PR Strategy
Media Strategy
ETC.
Sales Strategy HR Strategy IT Strategy ETC.
Business Strategy
Legal, financing, structure,
corporate governance
How is the business going to
compete (products, TM etc)
How does the functional part

of the business contribute to
the overarching strategies.
Tactics, processes,
operational level
Levels of strategy has to flow seemlessly (and
inform down) into each other and deliver back
up the hierachy
www.euruni.edu
Strategy without tactics is the slowest route to victory.
Tactics without strategy is the noise before defeat.
—Sun Tzu,
Oncubanews.com
www.euruni.edu
“As a business discipline marketing is the art and science of
creating value
by designing and managing viable market offerings” (Chernev,
2019)
• Function of a business like Finance, HR, IT, etc?
• Customer centric business philosophy?
• Moving products from a concept to customers?
• Set of functions (4P’s) or a process?
• Marketing is all of these, it is a valuable integrated function,
skill and

expertise that flows through the company. We will see why
throughout
this course.
• Marketing = Sales ?
• Marketing = Advertising
The role of marketing?
www.euruni.edu
www.euruni.edu
“Marketing aims to create superior value for target customers in
a way that
enables the company and its collaborators to achieve its goals.”
(Chernev, 2019)
Identifying Value – Target market and competitive analysis
Designing Value – Product, brand, 4P’s
Communicating Value – Communication mix
Delivering Value – Distribution (Digital, retail, experience)
1
2
3

4
Creating valueJoe ❯ �
What forms can value take?
www.euruni.edu
• Strategy vs Tactics
• Strategy aims to define the target market and the value that the
company
will provide. Target market and value proposition are the two
key
components of strategy.
• Tactics are the attributes and the offering that will create the
value in the
market. The actual activities that will give life to the strategy.
Marketing strategy and tactics
www.euruni.edu
• Medium
• Offer
• Journey
Marketing Strategy
Target

Market 1
Target
Market 2
Target
Market 3
Value
Proposition 1
Value
Proposition 2
Value
Proposition 3
• Medium
• Offer
• Journey
• Medium
• Offer
• Journey
www.euruni.edu
Three types of markets
Business to Consumer (B2C)
Markets where the offerings (products or
services) are aimed directly at the end user.

Business to Business (B2B)
Similar to B2C except the customer is a
business.
Consumer to Consumer (C2C)
Markets where companies / brands
facilitate the interaction between
customers.
www.euruni.edu
• Being able to choose the correct markets is vital for the
success of the
company.
• Important questions to ask when considering taret audience:
• Who is the audience?
• Why are they important?
• What are their characteristics?
• What do they think and do?
• What influences their decisions?
• Target market history:
• Henry Ford
Target Market
www.euruni.edu
• Two overarching aspects of target market selection involves
NEEDS and

PROFILE.
• Customer needs are the ”problems” customers have that you
are hoping
to solve with your product or service.
• Customer profile – who are they, what do they do, where do
they do it,
when do they do it and why do they do it.
• Demographics: - age, gender, income, occupation, education,
religion,
social class, household size, ethnicity, nationality.
• Geolocation: place of residence, place at this moment in ti me.
• Psychographics: personality, values, attitudes, interests,
lifestyle,
• Behaviour: shopping habits, frequency of purchase, quantity
of
purchase, price sensitivity, loyalty, social and leisure activities.
Target Market
www.euruni.edu
• The broad market players in
the value exchange
• Value has to be created
between all.
• It is important to note that this
relationship needs to be seen in

context of customer needs and
not single markets e.g:
Blockbuster from 9,000
stores to closed
doors.
• Share of wallet considerations.
Target Market
Customers
The Company
CompetitorsCollaborators
Context
The The 5-C’s framework, Chernev, 2020.
www.euruni.edu
• The Company
• The customer (current/potential/third party)
• The competitor (direct and indirect)
• Collaborators (suppliers, manufacturers, distributors, service
providers)
• Context:
• Physical context (Natural resources, climate, geography etc)
• Economic context (economic activity, inflation, interrest rates
etc)
• Regulatory context (laws, taxes, licence requirements import

export tarrifs)
• Technological context (Processes, skills, resources, design)
• Sociocultural conext (religion, value system, lifestyles etc)
Target Market
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• Marketing positioning and value proposition (next week)
• Situation analysis
– Market analysis
– Marketing audit
– Market measurement
– Profitability and productivity analysis
– Competitive environment
Todays lecture
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Marketing Planning Process
Without understanding the
market factors and the
environment where you will
operate in you will not be
able to develop an effective
and efficient strategy that
aligns company resources
with customer needs.

www.euruni.edu
Situation analysis
www.euruni.edu
• Situation anaylsis cosists of:
– Market analysis
– Marketing audit
– Competive environment analysis
Situation analysis
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• Which factors would you consider when conducting a market
analysis?
Market analysis
www.euruni.edu
analysis?
• What are the two main spheres of influence in a market?
Market analysis

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Target Market
www.euruni.edu
• The 5 C’s model is important in
market analysis and key in
ensuring the company is able to
add value to the customers.
Target Market
Customers
The Company
Context
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• Selecting the correct customer is NB because the aim of a
company is to create

products/services that adds value to the customer.
• Customer needs and profile = what value does the company
need to create and
how can they communicate that to the customer.
• The chosen target customers must be able to provide value to
the company and
collaborators.
• The company and collaborators need to create superior value
in relation to the
competition.
Target Market
www.euruni.edu
Target Market
Customers
The Company
Context
Value

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need to create and
the company and
collaborators.
in relation to the
competition.
• The choice of target customer drives all other components of
the 5 C’s framework.
Target Market
www.euruni.edu
Target Market
Customers
The Company

Context
Resources
required to
create value
Competitor set
aiming fullfil the
same needs
Collaborators
required to
create value
The effect of the
context
www.euruni.edu
• The competitors (direct and indirect)
• Knowledge of competitors are key to create supperior value
• Competitor identification should be relative to customer needs
and not industry.
• This means competitors in one market can be collaborators in
another market.
• Is also means the product range within a company can compete
with each other.
Target Market

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Target Market
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• Collaborators (suppliers, manufacturers, distributors, servi ce
providers)
• Companies do not always have all the resources needed to
compete or develop
value.
• Often resources that would be costly and time consuming to
develop will be
outsourced to collaborators.
• Suppliers, manufacturors, distributors, R&D, service
providers, external sales
force, advertising agencies, marketing research.
Target Market
www.euruni.edu
• The Company
• Ability to create market value dictated by resources and
objectives.
• Objectives/goals: monetary, strategic, etc.
• Resources enables value creation – collaborate or acquire.
Target Market

www.euruni.edu
• The Context:
– Physical context (Natural resources, climate, geography etc)
– Economic context (economic activity, inflation, interrest rates
etc)
– Regulatory context (laws, taxes, licence requirements import
export tarrifs)
– Technological context (Processes, skills, resources, design)
– Sociocultural conext (religion, value system, lifestyles etc)
Target Market
www.euruni.edu
The Value Proposition
Company
CollaboratorCustomer
Competitors
Value
Value
Va
lue
Value

Va
lue
Value
Cost and benefit
calculation
determines the value
Defining the value exchange, Chernev, 2020.
www.euruni.edu
Company
Value exchange
Optimal Value
Proposition
The 3 V market value principle, Chernev, 2020.
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”Whereas a company’s strategy determines its target market and
the value it
seeks to provide to relevant market participants, tactics

determine the specific
offering that will deliver the value outlined in the strategy.”
Chernev, Alexander. Strategic Marketing Management - The
Framework, 10th Edition (p. 21). Cerebellum Press. Kindle
Edition.
The market offering
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the
value it seeks to provide to relevant market participants, tactics
determine
the specific offering that will deliver the value outlined in the
strategy.”
Edition.
The market offering
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7 attributes that define the market offering:
The market offering
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– Product
– Service
– Brand
– Price
– Incentive
– Communication
– Distribution
The market offering
www.euruni.edu
The market offering
Product
Service
Price
Incentive
Communication
Distribution
Brand
www.euruni.edu

– Product
– Service
– Brand
– Price
– Incentive
– Communication
– Distribution
The market offering
Designing value
Communicating value
Delivering value
www.euruni.edu
– Product
– Service
– Brand
– Price
– Incentive
– Communication
– Distribution
The market offering
Product
Price
Promotion

Place
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Market Analysis
The Market Value Map, Chernev, 2020.
www.euruni.edu
• Different levels of analysis
• Company – SWOT
• Market – Market Value Map
• Industry – Porters 5 Forces
• Macro-environment - PESTEL
Situation Analysis
Macro -
environment
Industry
Market
Company
www.euruni.edu
Company Analysis

WeaknessesStrenghts
ThreatsOpportunities
Internal
controlable
factors
External
uncontrolable
factors
www.euruni.edu
Market Analysis
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Industry and Competitor Analysis
www.euruni.edu
New entrants
Substitutes
Suppliers power Buyer powerRivalry

Rivalry amongst existing
competitors
• Number of competitors
• Diversity of competitors
• Growth rate
• Bariers to exit
• Switching costs
• Brand loyalty
Threat of new entrants
• Econmies of scale
• Capital investment
• Access to distribution
• Switching costs
• Brand loyalty
Bargaining power of buyers
• Number of buyers & sellers
• Threat of backward
integration
• Size of buyers
• Price sensitivity
• Product differentiation
Bargaining power of sellers
• Threat of forward integration
• Size of sellers
Threat of substitutes
• Number of substitutes available

• Buyer propensity to change
• Price performance of substitute
• Cost of substitution Porter’s 5 Competitive Forces
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• The attractiveness of an industry is affected by the level of
competitiveness.
• What does increased level of competition mean to a company?
www.euruni.edu
• Threat of New Entrants
• The lower he barriers to entry the more likely it is that new
competitors
will enter the market. (How easy is it to enter the market?)
• To protect their markets companies try to create barriers to
entry:
– Economies of scale
– Capital requirements
– Switching costs
– Access to distribution
– Expected retaliation

www.euruni.edu
• Supplier power
• The higher the bargaining power of suppliers the more costly
the goods.
• High supplier power when:
– Many buyers and not many suppliers
– Differentiated and valued products
– Suppliers threaten to forward integrate
– There is no threat of buyers integrating backwards
– Industry is not key for supplier
• Can be reduced by finding new sources, integrating
backwards, design
standardized components.
www.euruni.edu
• Threat of substitutes
• The higher the threat of substitutes the more competitive an
industry
would be.
• Substitute threats depend on:
– Buyers willingness to substitute
– Relative price and performance of substitutes
– Cost of switching

www.euruni.edu
• Bargaining power of buyers
• The larger the buyer the more bargaining power (Carrefour)
• Buyer bargaining power is high when:
– Few buyers and many sellers
– Products are standardized
– Buyers threaten to integrate backward
– Sellers don’t threaten to integrate forward
www.euruni.edu
• Industry competitors
• The intensity of rivalry depends on:
– Structure of the competition
• More when many small competitors or a few equal sized
competitors
– Structure of costs
• High fixed costs could force price reduction
– Degree of differentiation
• The more differentiation of products the less rivalry
– Switching costs
• Higher switching costs reduces rivalry (product knowledge,
investment etc)

– Strategic objectives
• High growth = high competition
– Exit barriers
• The higher the exit barriers the higher the rivalry.
www.euruni.edu
• Political
• Economic
• Social / Cultural
• Technology
• Environmental
• Legal
www.euruni.edu
• Political and Legal
• Government nationalisation of industries and the expropriation
of property and
private sector assets, including inadequate protection of
intellectual property
rights.
• Unfair competition from the public sector
• Government intervention in business operations and activities.

• Unexpected imposition of discriminatory taxation and barriers
to international
trade and industry investment
• Unexpected imposition or tightening of foreign exchange
controls.
• National hostilities and military intervention.
www.euruni.edu
• Economic
• GDP & GNP
• GDP & GNP per capita
• Others:
• Income levels within a country
• Levels of disposable income
• Levels of saving
• Unemployment
• Stock market indices, such as movements in the ALSI
(CAC40, FTSE100, etc).
www.euruni.edu
• Social and cultural
• Social values, beliefs, attitudes, traditions, lifestyles etc.
• Products need to be created to cater for emerging markets
• Products need to be adapted for changing markets.

• Single parent households.
• Women in the workplace – higher household income, female
lifestyle.
• Change in educational demographics
• Increase in dual income families
• Increase in health and wellness awareness
• Change in age distribution
• Recreational habits change. (due to?)
www.euruni.edu
• Technology
• Product innovations
• Internet access
• Fixed line and cellular telephony
• Not only about technological advancement but what
opportunities technology can
afford an organisation
www.euruni.edu
• Environmental
• Organisations much more focused on environmental effects
both inside out and
outside in.

• Environmental legal implications
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Situation Analysis
Macro -
environment
Industry
Market
Company
www.euruni.edu
Marketing Audit
www.euruni.edu
• The marketing audit is a comprehensive, systematic, analysis,

evaluation
and the interpretation of the business marketing environment,
both
internal and external, its goals, objectives, strategies and
principles, to
ascertain the problem areas and opportunities and to recommend
a plan of
action to enhance the business’ marketing performance.
(Kotler, Keller, 2007.)
Marketing Audit
www.euruni.edu
• Determine how the current marketing strategy and tactics are
delivering
on the business objectives.
• Which tactics delivered (i.t.o, objectives, profit, productivity)
• Has the market changed.
• Requires analysis of marketing strategy in relation to the
business
objectives.
• Macro-environment analysis (PESTEL)
• Micro – environment analysis (5 C’s, Porter’s 5 Forces)
• Internal analysis – productivity, profitability
Marketing Audit
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• Necessary to consider the brand in the market and how it
affects
performance.
• Tropicana
Marketing Audit
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affects
performance.
• Tropicana
Marketing Audit
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Example of design impact on perception
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affects
performance.
• Tropicana

• Brand positioning includes pack, identity, positioning line.
Marketing Audit
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The Logo Company
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www.euruni.edu
www.euruni.edu
www.euruni.edu
• Marketing profitability analysis measures the contribution of
marketing

efforts (strategies and tactics) to the profit of the company.
• Marketing productivity analysis measures the sales and market
share
impact that the strategies and tactics have had.
www.euruni.edu
• Formating marketing strategies and programs
• Developing a value proposition
• Developing a competitve advantage
Next Lecture
www.euruni.edu
www.euruni.edu
Johan Reyneke
4 October 2021
Strategic Marketing
BCO211
www.euruni.edu

Todays lecture
Situation Analysis
The 5 C’s
Market analysis
1
2
3
4
5
Company Analysis
Industry Analysis
6
7
8
9

Todays Lecture
Marketimg Audit10
www.euruni.edu
What is strategy?
- and why is it
important?
www.euruni.edu
Strategy Definitions:
• “Strategy: a plan, method or series of actions designed to
achieve a
specific goal or effort.” – Wordsmyth Dictionary
• “Strategy is the direction and scope of an organization over
the long term
which achieves advantage in a changing environment through its
configuration of resources and competencies with the aim of
fulfilling
stakeholder expectations.” – Gerry Johnson, Kevin Scholes and
Richard
Whittington
What is strategy?

www.euruni.edu
www.euruni.edu
Marketing strategy role?
www.euruni.edu
Corporate
Strategy
Marketing
Strategy
Brand Strategy
Communication
Strategy
PR Strategy
Media Strategy
ETC.
Sales Strategy HR Strategy IT Strategy ETC.
Business Strategy
Legal, financing, structure,
corporate governance

How is the business going to
compete (products, TM etc)
How does the functional part
of the business contribute to
the overarching strategies.
Tactics, processes,
operational level
Levels of strategy has to flow seemlessly (and
inform down) into each other and deliver back
up the hierachy
www.euruni.edu
Strategy without tactics is the slowest route to victory.
Tactics without strategy is the noise before defeat.
—Sun Tzu,
Oncubanews.com
www.euruni.edu
“As a business discipline marketing is the art and science of
creating value
by designing and managing viable market offerings” (Chernev,
2019)
• Function of a business like Finance, HR, IT, etc?
• Customer centric business philosophy?

• Moving products from a concept to customers?
• Set of functions (4P’s) or a process?
• Marketing is all of these, it is a valuable integrated function,
skill and
expertise that flows through the company. We will see why
throughout
this course.
• Marketing = Sales ?
• Marketing = Advertising
The role of marketing?
www.euruni.edu
www.euruni.edu
“Marketing aims to create superior value for target customers in
a way that
enables the company and its collaborators to achieve its goals.”
(Chernev, 2019)
Identifying Value – Target market and competitive analysis
Designing Value – Product, brand, 4P’s
Communicating Value – Communication mix
Delivering Value – Distribution (Digital, retail, experience)

1
2
3
4
Creating valueJoe ❯ �
What forms can value take?
www.euruni.edu
• Strategy vs Tactics
• Strategy aims to define the target market and the value that the
company
will provide. Target market and value proposition are the two
key
components of strategy.
• Tactics are the attributes and the offering that will create the
value in the
market. The actual activities that will give life to the strategy.
Marketing strategy and tactics
www.euruni.edu
• Medium
• Offer

• Journey
Marketing Strategy
Target
Market 1
Target
Market 2
Target
Market 3
Value
Proposition 1
Value
Proposition 2
Value
Proposition 3
• Medium
• Offer
• Journey
• Medium
• Offer
• Journey
www.euruni.edu

Three types of markets
Business to Consumer (B2C)
Markets where the offerings (products or
services) are aimed directly at the end user.
Business to Business (B2B)
Similar to B2C except the customer is a
business.
Consumer to Consumer (C2C)
Markets where companies / brands
facilitate the interaction between
customers.
www.euruni.edu
• Being able to choose the correct markets is vital for the
success of the
company.
• Important questions to ask when considering taret audience:
• Who is the audience?
• Why are they important?
• What are their characteristics?
• What do they think and do?
• What influences their decisions?
• Target market history:
• Henry Ford
Target Market

www.euruni.edu
• Two overarching aspects of target market selection involves
NEEDS and
PROFILE.
• Customer needs are the ”problems” customers have that you
are hoping
to solve with your product or service.
• Customer profile – who are they, what do they do, where do
they do it,
when do they do it and why do they do it.
• Demographics: - age, gender, income, occupation, education,
religion,
social class, household size, ethnicity, nationality.
• Geolocation: place of residence, place at this moment in time.
• Psychographics: personality, values, attitudes, interests,
lifestyle,
• Behaviour: shopping habits, frequency of purchase, quantity
of
purchase, price sensitivity, loyalty, social and leisure activities.
Target Market
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• The broad market players in
the value exchange

• Value has to be created
between all.
• It is important to note that this
relationship needs to be seen in
context of customer needs and
not single markets e.g:
Blockbuster from 9,000
stores to closed
doors.
• Share of wallet considerations.
Target Market
Customers
The Company
Context
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• The Company
• The competitor (direct and indirect)
providers)
• Context:

• Physical context (Natural resources, climate, geography etc)
• Economic context (economic activity, inflation, interrest rates
etc)
• Regulatory context (laws, taxes, licence requirements import
export tarrifs)
• Technological context (Processes, skills, resources, design)
• Sociocultural conext (religion, value system, lifestyles etc)
Target Market
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• Marketing positioning and value proposition (next week)
• Situation analysis
– Market analysis
– Marketing audit
– Competitive environment
Todays lecture
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Marketing Planning Process
Without understanding the
market factors and the
environment where you will
operate in you will not be
able to develop an effective

and efficient strategy that
aligns company resources
with customer needs.
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Situation analysis
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• Situation anaylsis cosists of:
– Market analysis
– Marketing audit
– Competive environment analysis
Situation analysis
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analysis?
Market analysis
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analysis?
• What are the two main spheres of influence in a market?
Market analysis
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Target Market
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• The 5 C’s model is important in
market analysis and key in
ensuring the company is able to
add value to the customers.
Target Market
Customers
The Company
Context
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need to create and
the company and
collaborators.
in relation to the
competition.
Target Market
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Target Market
Customers
The Company
Context

Value
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need to create and
the company and
collaborators.
in relation to the
competition.
• The choice of target customer drives all other components of
the 5 C’s framework.
Target Market
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Target Market
Customers

The Company
Context
Resources
required to
create value
Competitor set
aiming fullfil the
same needs
Collaborators
required to
create value
The effect of the
context
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• The competitors (direct and indirect)
• Knowledge of competitors are key to create supperior value
• Competitor identification should be relative to customer needs
and not industry.
• This means competitors in one market can be collaborators in
another market.
• Is also means the product range within a company can compete
with each other.

Target Market
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Target Market
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providers)
• Companies do not always have all the resources needed to
compete or develop
value.
• Often resources that would be costly and time consuming to
develop will be
outsourced to collaborators.
• Suppliers, manufacturors, distributors, R&D, service
providers, external sales
force, advertising agencies, marketing research.
Target Market
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• The Company
• Ability to create market value dictated by resources and

objectives.
• Objectives/goals: monetary, strategic, etc.
• Resources enables value creation – collaborate or acquire.
Target Market
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• The Context:
– Physical context (Natural resources, climate, geography etc)
– Economic context (economic activity, inflation, interrest rates
etc)
– Regulatory context (laws, taxes, licence requirements import
export tarrifs)
– Technological context (Processes, skills, resources, design)
– Sociocultural conext (religion, value system, lifestyles etc)
Target Market
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Company
Competitors
Value
Value

Va
lue
Value
Va
lue
Value
Cost and benefit
calculation
determines the value
Defining the value exchange, Chernev, 2020.
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Company
Value exchange
Optimal Value
Proposition
The 3 V market value principle, Chernev, 2020.

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the value it
seeks to provide to relevant market participants, tactics
determine the specific
offering that will deliver the value outlined in the strategy.”
Edition.
The market offering
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the
value it seeks to provide to relevant market participants, tactics
determine
the specific offering that will deliver the value outlined in the
strategy.”
Edition.
The market offering
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The market offering

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– Product
– Service
– Brand
– Price
– Incentive
– Communication
– Distribution
The market offering
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The market offering
Product
Service
Price
Incentive
Communication
Distribution
Brand

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– Product
– Service
– Brand
– Price
– Incentive
– Communication
– Distribution
The market offering
Designing value
Communicating value
Delivering value
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– Product
– Service
– Brand
– Price
– Incentive
– Communication
– Distribution
The market offering
Product

Price
Promotion
Place
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Market Analysis
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Situation Analysis
Macro -
environment
Industry
Market
Company

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Company Analysis
WeaknessesStrenghts
ThreatsOpportunities
Internal
controlable
factors
External
uncontrolable
factors
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Market Analysis
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www.euruni.edu

New entrants
Substitutes
Suppliers power Buyer powerRivalry
Rivalry amongst existing
competitors
• Number of competitors
• Diversity of competitors
• Growth rate
• Bariers to exit
• Switching costs
• Brand loyalty
Threat of new entrants
• Econmies of scale
• Capital investment
• Access to distribution
• Switching costs
• Brand loyalty
Bargaining power of buyers
• Threat of backward
integration
• Size of buyers
Bargaining power of sellers
• Threat of forward integration
• Size of sellers

Threat of substitutes
• Number of substitutes available
• Buyer propensity to change
• Price performance of substitute
• Cost of substitution Porter’s 5 Competitive Forces
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• The attractiveness of an industry is affected by the level of
competitiveness.
• What does increased level of competition mean to a company?
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• Threat of New Entrants
• The lower he barriers to entry the more likely it is that new
competitors
will enter the market. (How easy is it to enter the market?)
• To protect their markets companies try to create barriers to
entry:
– Economies of scale
– Capital requirements
– Switching costs
– Access to distribution

– Expected retaliation
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• Supplier power
• The higher the bargaining power of suppliers the more costly
the goods.
• High supplier power when:
– Many buyers and not many suppliers
– Differentiated and valued products
– Suppliers threaten to forward integrate
– There is no threat of buyers integrating backwards
– Industry is not key for supplier
• Can be reduced by finding new sources, integrating
backwards, design
standardized components.
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• Threat of substitutes
• The higher the threat of substitutes the more competitive an
industry
would be.
• Substitute threats depend on:

– Buyers willingness to substitute
– Relative price and performance of substitutes
– Cost of switching
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• Bargaining power of buyers
• The larger the buyer the more bargaining power (Carrefour)
• Buyer bargaining power is high when:
– Few buyers and many sellers
– Products are standardized
– Buyers threaten to integrate backward
– Sellers don’t threaten to integrate forward
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• Industry competitors
• The intensity of rivalry depends on:
– Structure of the competition
• More when many small competitors or a few equal sized
competitors
– Structure of costs
• High fixed costs could force price reduction
– Degree of differentiation

• The more differentiation of products the less rivalry
– Switching costs
• Higher switching costs reduces rivalry (product knowledge,
investment etc)
– Strategic objectives
• High growth = high competition
– Exit barriers
• The higher the exit barriers the higher the rivalry.
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• Political
• Economic
• Social / Cultural
• Technology
• Environmental
• Legal
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• Political and Legal
• Government nationalisation of industries and the expropriation
of property and
private sector assets, including inadequate protection of

intellectual property
rights.
• Unfair competition from the public sector
• Government intervention in business operations and activities.
• Unexpected imposition of discriminatory taxation and barriers
to international
trade and industry investment
• Unexpected imposition or tightening of foreign exchange
controls.
• National hostilities and military intervention.
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• Economic
• GDP & GNP
• GDP & GNP per capita
• Others:
• Income levels within a country
• Levels of disposable income
• Levels of saving
• Unemployment
• Stock market indices, such as movements in the ALSI
(CAC40, FTSE100, etc).
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• Social and cultural
• Social values, beliefs, attitudes, traditions, lifestyles etc.
• Products need to be created to cater for emerging markets
• Products need to be adapted for changing markets.
• Single parent households.
• Women in the workplace – higher household income, female
lifestyle.
• Change in educational demographics
• Increase in dual income families
• Increase in health and wellness awareness
• Change in age distribution
• Recreational habits change. (due to?)
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• Technology
• Product innovations
• Internet access
• Fixed line and cellular telephony
• Not only about technological advancement but what
opportunities technology can
afford an organisation
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• Environmental

• Organisations much more focused on environmental effects
both inside out and
outside in.
• Environmental legal implications
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Situation Analysis
Macro -
environment
Industry
Market
Company
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Marketing Audit

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• The marketing audit is a comprehensive, systematic, analysis,
evaluation
and the interpretation of the business marketing environment,
both
internal and external, its goals, objectives, strategies and
principles, to
ascertain the problem areas and opportunities and to recommend
a plan of
action to enhance the business’ marketing performance.
(Kotler, Keller, 2007.)
Marketing Audit
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• Determine how the current marketing strategy and tactics are
delivering
on the business objectives.
• Which tactics delivered (i.t.o, objectives, profit, productivity)
• Has the market changed.
• Requires analysis of marketing strategy in relation to the
business
objectives.
• Macro-environment analysis (PESTEL)
• Micro – environment analysis (5 C’s, Porter’s 5 Forces)
• Internal analysis – productivity, profitability

Marketing Audit
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affects
performance.
• Tropicana
Marketing Audit
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affects
performance.
• Tropicana
Marketing Audit
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www.euruni.edu

affects
performance.
• Tropicana
• Brand positioning includes pack, identity, positioning line.
Marketing Audit
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The Logo Company
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www.euruni.edu
www.euruni.edu

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• Marketing profitability analysis measures the contribution of
marketing
efforts (strategies and tactics) to the profit of the company.
• Marketing productivity analysis measures the sales and market
share
impact that the strategies and tactics have had.
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• Formating marketing strategies and programs
• Developing a value proposition
• Developing a competitve advantage
Next Lecture
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12

Strategic Marketing
This paper was written by Alexander Buachidze
under the direction of Johan Reyneke
,
to comply with the Final Report of “Strategic Marketing”
course.
Date: 17.10.21
www.euruni.edu
Contents
Executive Summary 2
Introduction 4
Body 4
BMW Positioning and Objectives 4
Market Analysis, Marketing Audit and competitive analysis 5
Value Proposition 8
Summary 10
Bibliography 12

Executive Summary
Bayerische Motoren Werken AG (BMW) is a German
multinational corporate manufacturer of luxury vehicles as well
as motorcycles. Its headquarters are in Munich, Bavaria in
Germany. BMW’s partnership with premium product is founded
on its mission and vision statement that is the reason why it
essential to evaluates these statements. In regard to the 5C of
marketing, with company analysis, BMW tends to spend
considerable amount of resources or research as well as
innovation in regard to product design, process optimization and
establishing IT network. BMW provides a strong value
proposition for the brand. It is the ultimate driving machine.
Though one requires money to own it, it provides loyal fanbase
which improves luxury as well performance. The firm as well
stands up for first class mobility and enhances sustainable
development of the world. They have the ability to reconcile the
economy, ecology as well as the society.
Introduction
Bayerische Motoren Werken AG (BMW) is a German
multinational corporate manufacturer of luxury vehicles as well
as motorcycles. Its headquarters are in Munich, Bavaria in
Germany. The firm was founded in 1916 as a developer of
aircraft engine. The small car firm aims at growing by 50% in
the next 10 to 12 years. The market for premium items is

growing at a rapid rate. Majority of the clients do no
compromise safety, quality, driving features as well
individualism. This paper majors on providing a situational
analysis of BMW’s product endeavor. BodyBMW Positioning
and Objectives
Currently, BMW produces cars in India, China, Germany, South
Africa, the United States, Mexico, United Kingdom as well as
Brazil. BMW’s partnership with premium product is founded on
its mission and vision statement that is the reason why it
essential to evaluates these statements. The firm’s mission
statement is: “To become the world’s leading provider of
premium products and premium services for individual
mobility.” The mission tends to bring out the firm’s mission to
be the head in any aspect that major on. The firm aims at
majoring on premium market. The firm majors on high end
segments. BMW has continuously majored on being a
worldwide firm. Therefore they have to major on local
techniques in regard to manufacturing, hiring as well as
engineering.
BMW’s vison statement is “To be the most successful
premium manufacturer in the indursty” which supports its
mission statement. The firm’s policies are aligned, the firm’s
policies majors on providing premium level sub-services to its
customers. It tends to be interesting to see that the firm’s vision
statement is so simple and it is aligned with its mission
statement. The firm’s core values are “responsibility,
appreciation, transparency, trust and openness.” Transparency
and openness are the backbones of healthy corporate culture.
Firms which tend to be transparent and open have the ability to
retain talent which is an aspect that all firm struggle to attain.
Appreciation tends to be a value that assists employee to get the
recognition they require in order to be motivates. This aids in
making it possible for the firm to keep up with the premium
credentials in this field. The slogan for the firm is “The
Ultimate Driving Machine.”
BMW's mission and vision statements distinguish the

company as one that is dynamic and adaptable. They focus on
creating distinctive designs for their clients as well as
competing with other automotive manufacturing companies,
which has put them at the top of the excellence rankings.
Essentially, it is highly valued in today's times, serving as an
example of what a steadfast and well-known company should
be. A corporate vision statement recognizes a company's future
potential and declares it to be the company's primary purpose
(Ingenhoff, & Fuhrer 2010). The company's vision statement
emphasizes the company's ability to provide leadership in the
manufacturing business.Market Analysis, Marketing Audit and
competitive analysis
BMW tends to be product oriented in the perspective that all
firms that provide a combination of luxury as well as powerful
cars with a high level of quality as services. Additionally, the
market of BMW is composed of premium segments of the world
passenger car as well as motor cycle market. BWM is among the
leading luxury car manufacturers in the world. In the
developing automobile market in which growth of luxury
segmet is something that can noticeable. Increased need of
luxury cars in Asian markets, changing lifestyle and growth rate
of 33% in developing countries such as India. Many players
now aim at eating one another over market share. In the
developing nations firms such as Mercedes and audi are acting
appropriately while BMW does not have the ability to meet the
needs of the markets.
Through the BCG matrix, BMW business is a star in regard
to large share in the premium market segment and a high growth
rate for its model. The firm’s motorcylcle and the financial
services units are in question mark. In the BMW Cars business
BMW X3/ X5 SUV is question mark; BMW 3, 5, 7 series sedan
touring is stars given that there’re models which tops the sales
under the BMW’s portfolio; BMW Z4, M & 6 series is star;
BMW MINI will can be a star due to competition from Beetle;
and Rolls Royce belongs to cash cow and the Brand drive for
BMW (Hoppenburg 2021).

Based on the SWOT analysis of BMW, it strengths include
innovation and technological advancement; the firm has created
a pool of many 100,000 highly skilled workers; BMW as well
has a diversified product portolio; and the firm made a start
move by beginning early in developing economies. Its
weaknesses include there are issues associated with the recall of
cars due to technical functionality; and BMW has weak strategic
alliances (Bhasin 2018). The opportunities of BWM include it
has a chance to use other firm’s specialized abilities to
differentiate their offerings; getting in new markets will enable
the form to increase its revenues; and they have a chance to
increase their sales since there will be various choices for
clients in the same firm. The threats that may affect the firm
include low cost car firms with stylish and affordable offerings;
ad BMW is required to be strong enough to adapt to the needs
of fuel as well as green machines.
In regard to the 5C of marketing, with company analysis,
BMW tends to spend considerable amount of resources or
research as well as innovation in regard to product design,
process optimization and establishing IT network. It as well has
a strong culture of product as well as process innovations.
Based on customers’ factors, BMW should major on niche
segment given that it is highly profitable. The market size of the
firm may grow at a steady rate and it may present various
opportunities to expand to adjacent segments. With competitors’
factors, BMW is supposed to spend on its brands without
exerting focus on the parent firm. The threat to substitutes
mainly arises from economic cycle of technological innovation.
It requires repositioning of specific brands in regard to BMW in
specific markets. With collaborators factors, BMW is
diversifying in order to minimize delivery as well as supply
chain risk. With many suppliers, it might be hard for the firm to
manage them. Lastly with context factors, inflation tends to
highly affect the pricing technique of BMW since it tends to
lower income from the current sales. The consumer behavior
during the boom and recession period tends to differ thus the

marketing managers in the firm are required to decide on how
consumers will act with the state of economy.Value Proposition
BMW provides a strong value proposition for the brand. It
is the ultimate driving machine. Though one requires money to
own it, it provides loyal fanbase which improves luxury as well
performance. The taglines that they use in promoting their
products provides a promise that is steeped in hyperbole. The
firm has taken the challenges of effectiveness and they look
forward to making the challenge a part of their culture. They
invite their clients to identify if or not that which they are
saying is right or not. Use of hyperbole in branding as well as
advertising brings out indisputable confidence, ambition as well
as elevation on the fray. As the customers, we know how to
internalize the grandiloquent assertion prior to applying our
judgment to the decision of being part of the firm. The firm has
effectively position itself as doing that which they do better,
acknowledging the needs of their clients and bringing out the
information in a confident way.
Clients should purchase BMW products for a variety of
reasons. Their goods were of indisputable quality. BMW goods
are a blend of German engineering and cosmopolitan flair that
cater to the demands and wishes of luxury clients worldwide.
The firm uses a variety of procedures, including power on the
hood. If luxury automobile buyers choose a simple and effective
model, or a high-output road-burning vehicle, they are certain
of a premium rise as well as the best handling experiences.
BMW offers excellent acceleration as well as adequate power
beneath the hood.
Though they have established major value proposition, they
have majored on the millennial generation as their new target
while formerly they majored on mature as well as monetary
appropriate buyers. BMW as well has longest as well as colorful
histories in the field of automotive given that they are the
developers of gasoline and diesel engines (Williams 2019).
They’ve had about 60 years of developing prowess with the
totality of their historical product line majoring on luxury and

quality. With the several product lines, the firm aims at
providing solutions to all clients including the commercial,
industrial as well as consumer requirements majoring on quality
as well as luxury at an affordable price.
The firm is highly dedicated to quality instead of quantity. The
firm reengineers automotive safety as well as based on the
firm’s cutting edge progresses in car safety and connectivity.
The firm majors on delivering the best or nothing, safety should
come first. This is the reason why the firm dedicates it’s time to
moment they hope never happens. With the invention of the
crumple zone to countless innovation in occupant protection as
well as accident avoidance, the safety firsts of BMW has put in
place guidelines which all the automotive should follow. Part
of the firm’s value proposition is founded in safety as well as
innovation they have put in place and continue to lead the
industry in.
The firm as well stands up for first class mobility and enhances
sustainable development of the world. They have the ability to
reconcile the economy, ecology as well as the society. Due to
this clients enjoy outstanding products and demonstrate
responsibility. They as well provide thrilling items. Their high
profitability tends to safeguard their independence as a firm and
they use appropriate innovations as well as passion to redirect
the future of sustainable mobility. Their product are appropriate
since they use pioneering technologies, emotional items as well
personalized client support to establish a basic
experience.Summary
Bavarian Motor works majors on innovation, dedication and
determination. BMW is among the most known brands around
the globe. It produces items which are known for quality, utility
as well as style. Currently the firm is a global firm which yearly
generate many engines, motorcycles as well as cars. BMW
develops its products as a combination of luxury, safety as well
as comfort with product lines to fit all styles of living. Profits
have been rising every year as a result of automobiles and
motorcycles. BMW provided options to family based clients,

rich conservatives that require luxury and those that need bigger
vehicles for outdoor operation and those requiring flamboyant
cars.
BMW should monitor the changing client trends, diversity as
well as social opinions, in regard to advertisement technique on
appealing to a vast variety of the market as well as those that
may not afford the vehicles. The firm’s techniques should
involve major investments in technologies for instance clean
energy as well as self-driving vehicles and depict this in the
campaigns that position BMW as the innovator in the firm.
The firm is a worldwide automobile brands which develops and
sells premium level cars. Its main consumer segment is
composed of affluent people as well as the care lineup is made
to meet the needs of the consumers. The firms marketing
methods on innovation and performance taking advantage of its
comfortable brand-named to major on quality and scarcity. As
the marketing technique has been effective, it should be
modified to deal with emotionally appropriate marketing and
coming up with affordable care with close characteristics of
similar level of quality so as to improve the clients’ segment.
BibliographyBhasin, H, 2018, Marketing strategy of BMW –
BMW marketing strategy, accessed 16 October 16, 2021, <
https://www.marketing91.com/marketing-strategy
bmw/>Hoppenburg, T.T., 2021. The business portfolio synergy

analyzer: a model for evaluating synergies between business
models and its application to BMW (Doctoral dissertation).
Ingenhoff, D., & Fuhrer, T. 2010, ‘Positioning and
differentiation by using brand personality attribute: Do mission
and vision statements contribute to building a unique corporate
identity?’ Corporate Communications: An International
Journal, vol. 15, no. 1, pp. 83-101.
William, S 2021, ‘Creating a value proposition: What do you do
best in the world?’ < https://816nyc.com/positioning-statement-
best-world/#.YWrZ7RpByM9 >
BCO211 Strategic Marketing Task brief & rubrics
Assignment 2
Task
Individual Task
Identify and analyse the market segments, value proposition,
positioning and competitive advantage of the company or brand.
Continuing with the company or brand that you selected for
Assignment 1, analyse their market segmentation, the value
proposition offered for each segment
and which products and/or services they have aligned to the
relevant segments. Identify the positioning and competitive
advantage they currently employ and
the currently life cycle stage they are in for each product and
segment. Identify ethical and sustainability issues and/or
opportunities.

Your table of contents should include:
Title, executive summary, summary from Assignment 1, body of
work, summary, references.
The task should be completed as a professional report and
submitted (uploaded) in pdf format.
Formalities:
• Wordcount: 2000
• Cover, Table of Contents, References and Appendix are
excluded of the total wordcount.
• Font: Arial 12,5 pts.
• Text alignment: Justified.
• The in-text References and the Bibliography must be in
Submission: 7 November 2021 by 23h59 – Via Moodle
(Turnitin).
Weight: This task is a 30% of your total grade for this subject.
It assesses the following learning outcomes:
• Outcome 1: Apply the analytical frameworks used to assess
the major decisions facing marketing managers as they attempt
to harmonize organizational
goals and resources with market needs and opportunities.

Rubric
Exceptional 90-100 Good 80-89 Fair 70-79 Marginal fail 60-69
Knowledge &
Understanding
(20%)
excellent understanding of
key concepts and uses
vocabulary in an entirely
appropriate manner.
good understanding of the
task and mentions some
relevant concepts and
demonstrates use of the
relevant vocabulary.
Student understands the
task and provides minimum
theory and/or some use of
vocabulary.
Student understands the task
and attempts to answer the
question but does not
mention key concepts or uses
minimum amount of relevant
vocabulary.
Application (30%) Student applies fully

COURSE CODE COURSE NAME Task brief & rubrics BAT 212 The

COURSE CODE COURSE NAME Task brief & rubrics BAT 212 The

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