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Strategic

Marketing

Management

Dr.Amira El-Deeb 2

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An Overview of Strategic

Marketing

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Defining Marketing

Marketing

The process of creating, distributing, promoting,

and pricing goods, services, and ideas to facilitate

satisfying exchange relationships with customers

in a dynamic environment

Customers

The purchasers of organizations’ products; the

focal point of all marketing activities

What is Marketing?

Marketing as a culture characterized by a set of

values and beliefs that highlights the importance of

the customer’s interests

Marketing as a strategy concerned with the choice

of products, markets and competitive attitude

Marketing as the set of tactics (essentially the

seven Ps of the expanded marketing mix) that

provides the basis for the implementation of the

business and competitive strategy.4

Market, Sales, Technology Orientation

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Components of Market orientation

Figure 1.2 Components of market orientationSource: After Deng and Dart (1994)

How to create a market-

oriented Business?

1. Information Acquisition

Obtaining information about, customers,

competitors, markets

2. Inter functional Assessment

Viewing the information from a total business

perspective

Deciding how to deliver superior customer value

3. Shared Diagnosis & Action

Taking actions to provide value to customers

What is the difference between…

Marketing Strategy

&

Strategic Marketing

Marketing Strategy

It’s the analysis, strategy

development and implementation

of activities in :

Targeting strategies

Positioning strategies

Developing ,implementing and

managing the marketing program

positioning strategies designed to

meet the needs of customers.

Strategic Marketing – definition.1

It’s a market-driven

process of strategy

development, taking into

account a constantly

changing business

environment and the

need to achieve high

levels of customer

satisfaction.

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Strategic Marketing- definition.2

concerned with the direction and

scope of the long-term activities

performed by the organization to

obtain a competitive advantage to

satisfy needs or solving problems

It’s both a philosophy and a set of techniques

which address everything about the product

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STRATEGIC MARKETING

PROCESS

Strategic Marketing process

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Why to study strategic Marketing?..

To face the Challenge of .. As a marketer , you should manage:

Cost

Profit

Optimization

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Planning, Implementing, and

Controlling Marketing Strategies

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Why some Marketers Fail?

Wrong group targeted

Weak positioning strategy

Marketing environment

assessed inadequately

Misperception about

product or service attributes

and benefits

Wrong pricing strategy

Insufficient level of new

product/new service

awareness from

advertising

Over-optimism about

marketing plan

= Inefficient Marketing planning

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Understanding the Strategic

Planning Process

Strategic Planning

The process of establishing an organizational

mission and formulating goals, corporate strategy,

marketing objectives, marketing strategy, and a

marketing plan

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Steps of Strategic Planning

Most large companies consist of 3 organizational levels:

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1. The Corporate level :

Defining the purpose and mission of the Company.

Designing the business portfolio.

Planning for new business, downsizing older business

2. The Business unit level :

Business unit mission

SWOT analysis

Goal formulation

Designing strategies

Developing detailed marketing plans

Levels of Strategic Planning

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Assessing Organizational

Resources and Opportunities

Core Competencies

Things a firm does extremely well (strengths),

which sometimes give it an advantage over its

competition

Financial or production sector

Reputation, goodwill, and brand names

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Assessing Organizational

Resources and Opportunities

Market Opportunity

A combination of circumstances and timing that

permits an organization to reach a target market

Core competencies are matched to opportunities to

give competitive advantages

Strategic windowoptimal fit between market opportunities (the key requirements of a market) and core competencies

(the particular capabilities of a firm)

Mission/Strategy/Tactics

Goals TacticsMission Strategy

Strategy

Mission

The reason for existence for an organization

Mission Statement

Answers the question “What business are we in?”

Goals

Provide detail and scope of mission

Strategies

Plans for achieving organizational goals

Tactics

The methods and actions taken to accomplish strategies

Planning and Decision Making

Mission

Goals

Organizational Strategies

Functional Goals

Finance

Strategies

Marketing

Strategies

Operations

Strategies

Tactics Tactics Tactics

Operating

procedures

Operating

procedures

Operating

procedures

Strategy Example

Rita is a high school student. She would like to have a career in business, have a good job, and earn enough income to live comfortably

Mission: Live a good life

Goal: Successful career, good income

Strategy: Obtain a college education

Tactics: Select a college and a major

Operations: Register, buy books, takecourses, study, graduate, get job

Example 1

DEVELOPING VISION &

MISSION STATEMENT

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Developing Vision & Mission

Great benefits can be achieved if

an organization

Systematically revisits their vision and

mission statement

Treats them as living documents

Considers them to be an integral part

of the firm’s culture

Developing Vision & Mission

Participation by as many managers as

possible is important in developing the

mission because through involvement

people become committed to an

organization

Vision Statement

- Defines your long-term dream

- It’s inspirational statement

- WHAT TO DO?

Vision & Mission Statement

Mission Statement

- Products and services provided

- Your business –values

- HOW TO DO?

Business vision

Desired future state; the aspiration of

the Organization

What are our Dreams?

What do we want to look like in 5, 10,

15 years?

Where do we want to go?

Vision Statement Examples

Tyson Foods’ vision is to be the

world’s first choice for protein

solutions while maximizing

shareholder value.

General Motors’ vision is to be the world leader in transportation products and related services.


Dell’s vision is to create a company culture where environmental excellence is second nature.


Comprehensive

Mission Statement

Vision

Clear Business

Vision

A statement of purpose that distinguishes

one organization from other enterprises

A declaration of an organization’s “reason

for being”= “What is our business?”, “what

the organization does”,” whom we want to

serve.”

Mission Statement

Mission Statements are also called

Statement of purpose

Statement of philosophy

Statement of beliefs

Statement of business principles

A statement “defining our business”

Mission

Components

Customers

Markets

Employees

Public

ImageSelf-Concept Philosophy

Survival,

Growth,

Profits

Products or

Services

Technology

Fleetwood Enterprises will lead the recreational vehicle and manufactured housing industries in providing quality products with a passion for customer-driven innovation.

We will emphasize training, embrace diversity and provide growth opportunities for our associates and our dealers. We will lead our industry in the application of appropriate technologies.

We will operate at the highest levels of ethics and compliance with a focus on exemplary corporate governance. We will deliver value to our shareholders, positive operating results and industry-leading earnings.

Mission Statement Examples

We aspire to make PepsiCo the world’s premier

consumer products company, focused on

convenient foods and beverages.

We seek to produce healthy financial rewards for

investors as we provide opportunities for growth

and enrichment to our employees, our business

partners and the communities in which we

operate. And in everything we do, we strive to act

with honesty, openness, fairness and integrity.


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Mission Statement examples

SINGAPORE AIRLINES is engaged in air

transportation and related businesses. It

operates world-wide as the flag carrier of

the Republic of Singapore, aiming to

provide services of the highest quality at

reasonable prices for customers and a profit

for the company

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Mission Statement examples

MARRIOTT’S Mission Statement:

We are committed to being the best lodging

and food service company in the world, by

treating employees in ways that create

extraordinary customer service and

shareholder value

Dell’s mission is to be the most successful computer company in the world at delivering the best customer experience in markets we serve. In doing so, Dell will meet consumer expectations of highest quality; leading technology; competitive pricing; individual and company accountability; best-in-class service and support; flexible customization capability; superior corporate citizenship; financial stability.


Proctor & Gamble will provide branded

products and services of superior quality and

value that improve the lives of the world’s

consumers. As a result, consumers will reward

us with industry leadership in sales, profit, and

value creation, allowing our people, our

shareholders, and the communities in which

we live and work to prosper.


L’Oreal, we believe that lasting

business success is built upon ethical

standards which guide growth and on

a genuine sense of responsibility to

our employees, our consumers, our

environment and to the communities in

which we operate.


Principles of Marketing A.U.C - Amira EL-Deeb47

Nokia

Vision :

Our vision is a world where everyone can be connected

Mission :

Nokia helps people to fulfill this need and we help people

feel close to what matters to them. We focus on

providing consumers with very recent technology that is

a joy to use, and beautiful.

http://www.nokia.com/


Otsuka Pharmaceutical Co.

Vision The creation of products to serve the better health of

people around the world.

Mission Clinical studies are carried in research centers in the USA

,Germany, UK and Japan aiming for products of universal value.

With a collaboration among marketing, research sectors so that

customers' real needs may be feedback for further product

development.

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Examples – Good and Bad

Mission Statements

To Make People Happy

To Explore the

Universe and Search

for Life and to

Inspire the Next

Generation of

Explorers

NASA

Walt Disney

Could be good example since it

express the core values of the

organization. Also conveys unique

qualities about the organization.

Too vague and unclear. Need more

descriptive information about what

makes the organization special.

Benefits of Mission Statements

Better financial results

agreement on purpose

Resource allocation

Establishment of culture

Focal point for individuals

Establishment of work structure

Basis of assessment and control

Resolution of different views

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Market-Oriented Mission

• A mission statement should be:

– An “invisible hand” to guide & control everything in the organization.

– Not too narrow nor too broad

– Fitting of market environment

– Based on distinctive competencies

– Motivating

Market-oriented &

Product-oriented Mission

Do not offer me things. offer me solutions

Do not offer me clothes. Offer me attractive looks.

Do not offer me shoes. Offer me comfort for my feet and the pleasure of walking.

Do not offer me a house. Offer me security, comfort, and a place that is clean and happy.

Do not offer me books. Offer me hours of pleasure and the benefit of knowledge.


Carrier :

We make air conditioners

(Product oriented )

We provide climate control

( Market Oriented )

Market-oriented &

Product-oriented Mission

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Business Goals

Goals convert the organization’s

mission into tangible actions and

results that are to be achieved, often

within a specified time frame.

Three major categories of goals:

1. Production

2. Financial

3. Marketing

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Production Goals

Apply to the use of

manufacturing and service

capacity and to product

and service quality.Financial Goals

Focus on profit, cash

flow, and shareholder

wealth.

Marketing Goals

market share

sales volume

profit

customer satisfaction

customer value creation

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Marketing objectives

A statement of what is to be accomplished

through marketing activities, it should be

SMART Should be stated in clear & Specific words

Should be accurately measurable

Should be ambitious, achievable, attainable to motivate

the others

Should be realistic according to market needs

Should specify a time frame for accomplishment

e.g.

To increase sales of product globally by 30% within 5yrs.

GOAL OBJECTIVE STRATEGY

To be

No. 1

in the

market

Increase

market

share by

15% in

three

years

i) Increase product

promotion

ii) Design product

pricing

iii) Penetration

iv) New market

development

v) Quality

improvement

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B. Designing the Business Portfolio

By classifying Strategic Business unit ( SBU )into one of four categories using the:

Market growth rate

SBU’s relative market share within the market.

Through a technique called … BCG

“ Boston Consulting Group matrix ”

1. The Corporate Strategic Planning

•Step 1: Analyze the current business portfolio

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B. Designing the Business Portfolio

Market Growth rate % =

Total Market Sales this year – Total Market Sales last year

Total Market Sales last Year

Relative Market Share =

The Company Sales

The Leader Sales


•Step 1: Analyze the current business portfolio

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Source: “The BCG Portfolio Matrix” from the Product Portfolio Matrix, © 1970, The Boston Consulting

Group. Reproduced by permission. FIGURE 2.4

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1. Question mark: (high growth market but with low market share),

question mark units or products require lots of money

2. Stars a market leader unit (or product) in a high growth market, the

company must spend money to keep up with the high market growth.

3. Cash cow a product still has the largest relative market share

although the market annual growth rate is less than 10 %. Although a

cash cow business produces a lot of cash for the company, it doesn’t

have to finance expansion because the market growth rate has

slowed down.

4. Dogs are products that have weak market share in a low growth

markets.

BCG MATRIX

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After the analysis, the company determines which

strategy and budget are to assign to each SBU, and a

one of four strategies can be applied:

Build where the objective is to increase market share.

Hold: here the objective is to preserve market share. More

investment should be done to keep that level.

Harvest: harvesting involves “milk the business” e.g.

eliminating R&D, not replacing the physical plants as it

wears out, not replacing sales people, and reducing

promotional expenditure.

Divest: here is the objective is to sell or liquidate the business

because resources can be better used else where.

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Case: SMART

Your company “smart” is working in the

manufacturing and marketing of entertainment

products producing four products:

DVD, Notebook, videos, and radios,

as a marketing manager you should determine what

objective and which strategy and budget is to assign

to each product, Before deciding on a strategy, you

should explain the reason for adopting such strategy

to such product

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20082007

11.800.00010.000.000Total DVD market

800.000700.000Product A Sales

200.0000SMART DVD

20.700.00018.000.000Total Notebook market

2.200.0001.800.000SMART Notebook

1.200.0001.000.000Product B sales

7.500.0007.000.000Total Videos market

600.000500.000SMART Videos

300.000250.000Product B sales

5.590.000 5.500.000Total Radio Market

800.000700.000Product A sales

300.000400.000SMART radio

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The GE Matrix

Invest or

Grow

Earn

selectively

Harvest or

Divest

Business Strength

Strong

Medium

Weak

StrongMediumWeak

GE Matrix

The size of each represents the size of each

market.

Within each circle is a clearly defined

segment which represents the business’s

market share within that market.

The larger the circle, the larger the market,

and the larger the segment, the larger the

market share.

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Market attractiveness:

Size of market.

Market rate of growth.

The nature of competition and its diversity.

Profit margin.

Impact of technology, the law, and energy

efficiency.

Environmental impact.

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Competitive position:

Market share.

Management profile.

R & D.

Quality of products and services.

Branding and promotions success.

Place (or distribution).

Efficiency.

Cost reduction.69

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a. Intensive growth


•Planning for new Businesses

Product

Development

Market

Development

Market

Penetration

Diversification

Current Product

Current

Market

New

Market

New Product

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Market penetration

where a company would attempt to make more

sales to current customers without changing its

products.

Market development

a situation where a company would identify and

develop new markets for its current products.

Product development = a company would modify or

create new products and offer them to current markets.

Diversification = companies start up or buy

businesses outside of its current products and markets.

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b. Integrative Growth

Backward integration:

acquiring supplier

Forward integration:

acquiring distributor

1. The Corporate Strategic Planning :

•Planning for new Businesses

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2. Business unit strategic planning

A. Business unit mission

We redefine the mission of our business but for each

SBU

B. SWOT analysis

Analyze the environment around us, externally &

internally

C. Setting the goals & objectives

D. Developing Marketing strategy & plan

E. Implementation & Feedback

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SWOT Analysis

An assessment of the organization’s strengths, weaknesses, opportunities, and threats

Strengths

competitive advantages or core competencies

Weaknesses

limitations on competitive capability

Opportunities

favorable conditions in the environment

Threats

conditions or barriers to reaching objectives

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