Marketing Strategy

Marketing Strategy COURSE OUTLINE Part : What is Marketing ? Part : Importance of Marketing Part : Marketing Plan Part : Marketing Strategy Part : Positioning PART WHAT IS MARKETING ? What is Marketing? • It is the most interesting, dynamic, versatile of all academic disciplines • It is both theoretical and practical in nature • It yields real results in the form of profits and/or satisfaction of business aims/objectives • Overall, it enhances human and national economic development/progress What is Marketing? Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders Marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering, and freely exchanging products and services of value with others Recent formal Definition of Marketing • Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders Source: American Marketing Association, 2004 The Marketing Concept (key issues) • Organizations must concentrate on the customer and not the product or the company • Organizations should revolve round the customer and not the other way around • The purpose of a business is to create and keep a customer (Theodore Levitt) Some Criticisms of Marketing • Too many advertisements are annoying, misleading, or both • There are too many unnecessary products • Middlemen raise prices but don’t add value • Marketing makes people materialistic • Most of the criticisms result from misunderstandings about marketing (Perreault & McCarthy, 1999) Do you know your market? • What is the product or service being offered? • What are the market trends in the industry? • What is the market? • Who are your customers? And what are they looking for? • Who are your competitors? And how they operate/react/behave? • Why (should) your customers buy your product/service rather than that of your competitors? What is Marketed? • Goods • Places • Services • Properties • Events • Organizations • Experiences • Information • Persons • Ideas Alternative Strategies for Product Life Cycle Stages • Introduction Stage - Rapid-skimming strategy (high price/high promotion) - Slow-skimming strategy (high price/low promotion) - Rapid-penetration strategy (low price/high promotion) - Slow-penetration strategy (low price/low promotion) Alternative Strategies for Product Life Cycle Stages • Growth Stage - Improve service quality and add new service features and elements - Pursue new target markets - Use new channels of distribution - Lower prices to attract more pricesensitive customers - Shift some advertising emphasis away from building awareness to creating desire and action Alternative Strategies for Product Life Cycle Stages • Maturity Stage - Market-modification strategy - Product-modification strategy - Marketing-mix modification strategy • Decline Stage - Reduce costs and milk the company - Sell off or get out of the business Alternative Strategies by Industry Position Market Leaders • Expand the size of the total market • Protect market share • Expand market share Market Challengers • Take on or attack the market leader Alternative Strategies by Industry Position Market Followers • Shy away from any attacks on market leaders Market Nichers • Specialize in a particular market segment PART POSITIONING Positioning • Positioning is the development of a service and a marketing mix to occupy a specific place in the minds of customers within target markets Reasons for Increased Importance of Positioning Perceptual processes of customers - They screen out most information Greater competition - More organizations competing for share of mind Growing volume of commercial messages - Advertising and promotion clutter Steps Required for Effective Positioning (the five Ds) • • • • • Documenting Deciding Differentiating Designing Delivering The Ds of Positioning Documenting • What benefits are the most important to your current and potential customers? Deciding • What image you want your current and potential customers to have of your organization? Differentiation • Which competitors you want to appear different from, and what are the factors that you will use to make your organization different from them? The Ds of Positioning Designing • How will you develop and communicate these differences? Delivering • How will you make good on what you’ve promised, and how you make sure that you have “delivered?” Positioning Approaches: Six Major Alternatives • • • • • • Specific product features Benefits, problem solution, or needs Specific usage occasions User category Against another “product” “Product class” dissociation Group Activity • New products should always target new adopters versus new products should target the broadest market possible • Discuss Thank You [...]... contain value for the product PART 3 MARKETING PLAN Marketing Plan • A marketing plan is the central instrument for direction and coordination the marketing efforts • The strategic marketing plan lays out the target markets and the value proposition that will be offered based on an analysis of the best market opportunities • The tactical marketing plan specifies the marketing tactics including product.. .Marketing vs Sales Peter Drucker “The aim of marketing is to make sales superfluous” Marketing vs Sales • Marketing is a more comprehensive process • Sales – focus on needs of Seller • Marketing – focus on needs of buyer • Selling has a short term outlook • Marketing has a long term vision Group Activity • ‘There are too many... grouping consumers by some criteria • Targeting: choosing which group(s) to sell to • Positioning: select the marketing mix most appropriate for the target segment(s) 8 Ps of Marketing • • • • Product Promotion People Packaging • • • • Price Place Programming Partnership or Passion 5 C's of Marketing • Customer (customer needs, segments, consumer behavior) • Company Skills (brand name, image, production... suppliers) • Context (culture, politics, regulations, social norms) Changes 1 Marketing Department to Marketing Organization 2 Focus on Product Unit to focus on Segments 3 Working with fewer suppliers 4 Emphasis on intangible assets 5 Online interactions 6 Market share Vs share of wallet 7 Global 8 Stakeholders Vs Shareholders Marketing Sins 1 The firm is not sufficiently market-focused or customer-driven... opportunities 5 The firm has not managed well its relationship with stakeholders Marketing Sins 6 The firm’s market plans and planning processes are deficient 7 The firm’s products need tightening 8 Weak brand building and communication 9 The firm is not well organized to carry on marketing 10 Lacking in use of technology Marketing and Customer Value Value and Satisfaction • Value = Benefits/Costs •... resources Marketing Orientation • Focus on the identification of customers needs, organizational resources and objectives • Achieve effective match through market segmentation, targeting, positioning and resource development Social Responsibility and Marketing Ethics • Social responsibility concerns a firm’s obligation to improve its positive effects on society and reduce its negative effects • Marketing. .. ,pricing ,sales channels and service Objectives of the marketing plan • Acts as a roadmap • Assist in management control and monitoring the implementation strategy • Informs new participants in the plan of their role and function • To obtain resources for implementation • To stimulate thinking and make better use of resources Contents of the Marketing Plan • Executive summary and table of content... Situation analysis Data on sales, costs, the market competitors and the various forces in the microenvironment How is market defined, how big it is, how fast it is growing? Contents of the Marketing Plan • Marketing strategy • Financial projections Sales forecast an expense forecast and break even analysis • Implementation controls Review of each period’s results, steps to be taken in response to specific... Kotler, P (2004), Marketing Management, Prentice-Hall, Englewood Cliff, NJ Market Types • Consumer Markets • Industrial/Business to Business Markets • Reseller (Retailers, Distributors) Markets • Publics (Government agencies/departments/institutions) • International/global Markets Market Orientation • Production Orientation - 1850s -> 1930s • Sales Orientation - 1930s -> 1950s Time • Marketing Orientation... has a short term outlook • Marketing has a long term vision Group Activity • ‘There are too many unnecessary products.’ in the market • What is your opinion? • Why? PART 2 IMPORTANCE OF MARKETING ? Importance of Marketing • According to the Customer Service Institute, it costs as much as five times as much to acquire a new customer than it does to service an existing one • Customers tell twice as