West, Ford & Ibrahim: Strategic Marketing Chapter 2: Marketing strategy: analysis and perspectives

Structure C. WHERE DO WE WANT TO BE? B. WHERE ARE WE NOW? A. INTRODUCTION 1. Overview and Strategy Blueprint 2. Marketing Strategy: Analysis & perspectives B. WHERE ARE WE NOW? 3. Environmental & Internal Analysis: Market Information & Intelligence C. WHERE DO WE WANT TO BE? 4. Strategic Marketing Decisions, Choices & Mistakes 5. Segmentation, Targeting & Positioning Strategies 6. Branding Strategies 7. Relational & Sustainability Strategies E. DID WE GET THERE? 14. Strategy Implementation, Control & Metrics D. HOW WILL WE GET THERE? 8. Product Innovation & Development Strategies 9. Service Marketing Strategies 10. Pricing & Distribution 11. Marketing Communications 12. E-Marketing Strategies 13. Social and Ethical Strategies

Learning Objectives To introduce the concept of strategy To illustrate the hierarchy of strategy To describe the purpose and role of ‘strategy’ To review the linear models for strategy making process To discuss the relationship between corporate and marketing strategy 3

The concept of ‘strategy’ Generic a plan of attack for winning a plan for beating the opposition Organisational a plan for achieving organisational goals a plan for securing a competitive advantage in a given market 4

Strategy definition “the direction and scope of an organisation over the long(er) term, which ideally matches its resources to its changing environment and, in particular its markets, customers or clients so as to meet stakeholder expectations” Johnson & Scholes (1999) 5

Business (Division Level) Strategy Hierarchy of strategy Corporate Strategy Corporate Headquarters Business (Division Level) Strategy SBU SBU SBU Functional Strategy Manufacturing Finance Marketing R&D HRM * Strategic management may be initiated at any or all of these hierarchical levels of an organisation. 6

Three levels of strategy Corporate The overall goals of the business; often expressed in financial terms Competitive/Business (SBU) How to compete in individual product-markets and support the corporate strategy Functional Functional strategies for the organisation’s functional areas in support of SBUs and corporate strategies 7

Purpose of strategy To set the future direction for the organisation To state how it is to create value to customers To identify what product/s and in which markets the firm will invest its resources To describe how it is to perform better than competition 8

Strategy help in: Defining the scope of business Finding ‘Strategic Fit’ between the organisation and its external environment Identifying a Sustainable Competitive Advantage (SCA) Guiding the allocation of resources 9

The interrelationship between marketing and corporate strategy Specifying the organisation’ mission Allocation of resources across the whole organisation Portfolio of activities for the organisation Defining organisational objectives Guides Directs Controls Co-ordinates Informs Achieves operationalises Marketing Strategy Competing in a product market Selecting market segments Designing the mix Brassington Frances and Stephen Pettitt (2006) 10

Operational vs strategic marketing Operational Marketing Action-oriented Existing opportunities Non-product variables Stable environment Reactive behaviour Day-to-day management Marketing department Strategic Marketing Analysis-oriented New opportunities Product market variables Dynamic environment Proactive behaviour Longer range management Cross-functional 11

Marketing orientation Marketing orientation is a state of mind, or a philosophy, that guides the strategic vision and future direction of companies. Marketing-orientated firms adopt a proactive search for market opportunities, use market information as a base for analysis and organisational learning, and adopt a long-term strategic perspective on markets and brands. Bjoern.Ambos@wu-wien.ac.at 12

Does marketing orientation contribute to company success? Bjoern.Ambos@wu-wien.ac.at 13

Marketing orientation and business performance INPUTS OUTPUTS ? Performance Bjoern.Ambos@wu-wien.ac.at 14

Conclusion Strategy can be simply defined as a plan for securing a competitive advantage in a given market. Strategy exists at multiple levels in an organisation: corporate, business unit, and functional levels. The marketing concept has a significant role to play in strategy development and corporate success. Competitive marketing strategy aims to establish a profitable competitive position for the firm against all forces that determine industry competition. Strategy making process has been discussed in the literature in such terms as strategic market planning and strategic market management. 15