1. Marketing Strategies Selecting Marketing Strategies
BUSS3.9 Selecting Marketing Strategies

2. Selecting Marketing Strategies In this topic you will learn about:
Low cost versus differentiation
Market penetration
Product development and market development strategies
Diversification
Assessing effectiveness of marketing strategies
BUSS3.9 Selecting Marketing Strategies

3. How the business will go about achieving its marketing objectives
Marketing strategy
Corporate objectives
Marketing objectives
Market analysis
BUSS3.9 Selecting Marketing Strategies
Marketing strategy
How the business will go about achieving its marketing objectives

4. Using a matrix to analyse Marketing strategy
Strategies
Low cost v. Differentiation
Market penetration
Product development and market development strategies
Diversification
BUSS3.9 Selecting Marketing Strategies

5. Michael Porter’s Strategic matrix
Analyses low cost v. differentiation
Porter’s basic premise is to be one thing or the other and not stuck in the middle.
Marketing messages must be clear and non contradictory
Tesco “ Good food that costs less”
M&S “ Its not just food its M&S food”
BUSS3.9 Selecting Marketing Strategies
PRIMARK

6. Porter’s Generic Strategy
Lowest
Cost
Highest
Differentiation
Cost
Leadership
Differentiation
Focused Cost
Focused
Mass
Market
BUSS3.9 Selecting Marketing Strategies
Niche
Market

7. JJB – Why did it Fail?
Most obvious problems included expanding too fast, overtrading and excessive gearing.
However JJB’s CEO described them as being ‘stuck in the middle’ – Lack of Retail Focus
Never found a proper point of difference
Sports Direct focused on value for money.
JD sports is at the fashion end of the sportswear market.
Therefore no reason for consumers to go there.
BUSS3.9 Selecting Marketing Strategies

8. Activity – Porter
Select an industry in which there are several competitors e.g. Clothing, supermarkets, cars
List all the firms that compete in this industry and try to place them in Porter’s matrix
Low cost
Differentiated
Mass
Niche
BUSS3.9 Selecting Marketing Strategies

9. Igor Ansoff’s Matrix
Ansoff looked at the degree of risk and potential for reward from different strategic options
However trying to just sell more of an existing product in an existing market is unlikely to bring about substantial growth opportunities
BUSS3.9 Selecting Marketing Strategies

10. Igor Ansoff’s Matrix Market Penetration Product Development
PRODUCTS
Existing
New
Market Penetration
Product Development
Market Development
Diversification
Existing
MARKETS
New

11. Ansoff’s Matrix – Market Penetration
Trying to sell more of an existing product to the existing market
Low risk strategy but limited potential reward
Volvic
BUSS3.9 Selecting Marketing Strategies
Innocent
McDonalds

12. Ansoff’s Matrix – Market Development
Attracting new customers to buy existing products
Risk associated with lack of knowledge of customers (may be new customer type or new location).
BUSS3.9 Selecting Marketing Strategies
Tescos
Wii

13. Ansoff’s Matrix – product development
Selling new and better products to existing customers
Risk comes from not knowing the products, high R&D costs and competitors’ reactions
BUSS3.9 Selecting Marketing Strategies
IHG

14. Ansoff’s Matrix - Diversification
Selling new products to new markets
High risk strategy as 2 elements are unknown - the market and the product
High risk but also greatest potential for reward
BUSS3.9 Selecting Marketing Strategies

15. National & International Contexts
Market Penetration
A business already operating internationally has wider potential
Product Development
May tap into expertise for R&D
Identify country leading in product development
Market Development
Identify rising star countries
Easier if new areas have similar expectations and cultures
Diversification
Continues to be highest risk strategy especially in an international context
BUSS3.9 Selecting Marketing Strategies
Fresh ‘n’ Easy

16. Entering international markets
Methods
Export products to already established distribution outlets
Set up an overseas operation
Export from UK base (easier with internet sales)
Risks
Cultural differences
Greater use of intermediaries
Language barriers
Benefits
Wider target market
Expertise from around the world
Global branding
BUSS3.9 Selecting Marketing Strategies

17. Assessing the effectiveness of marketing strategies
Did it help achieve marketing objectives?
Has it contributed towards corporate objectives?
What has impact been on other functional objectives?
How has decision impacted upon stakeholders?
BUSS3.9 Selecting Marketing Strategies

18. Activity Draw a blank Ansoff’s matrix on A4 paper
Place each of the following strategic decisions in the correct quadrant
Coca Cola launch bottled milkshake
Tesco open stores in Saudi Arabia
Sainsbury take over Costcutter convenience stores
British Gas launch Goldfish credit card
Mercedes introduce the A class small car
Apple introduces the iPad mini 2
M and S introduce the ‘2 Dine for £10’ this weekend
Research the history of the “Easy” brand and track this using Ansoff’s matrix.
Using both Porter and Ansoff assess the effectiveness of marketing strategies adopted by the Easy group of brands.
BUSS3.9 Selecting Marketing Strategies