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Strategic Market Planning
Strategic market planning sets the strategic
direction for a business and plays a critical
part in achieving a businesss long-run
objectives of sales growth, profit
performance, and share position.Best 2000
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Market-Based Management
Tactical Marketing
Strategies
Market Analysis
Strategic Market
Planning
Marketing Planning, Implementation and Performance
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Strategic Market Planning Process
The strategic market plan sets the strategic
direction and provides broad guidelines for
resource allocation.
A tactical market strategy is a short-term
marketing strategy with a one-year time horizon.
The primary purpose of a strategic market plan
is to provide a strategic direction from which toset performance objectives and guide the
development of a tactical marketing strategy.
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Offensive vs. Defensive Strategic
Market Planning
Offensive strategic market plans require
investment for growth, which limits short-run profit
performance while building sales revenue and
improving share position.
A defensive strategy to protect share should notbe misinterpreted to mean a strategy of holding
resources constant.
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Offensive vs. Defensive Strategic
Market Plans
Offensive -- Growth-oriented built around:
Share penetration ormarket growth of existing markets
Plans to enternew existing oremerging markets.
Critical to business growth and future market positionand profitability
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Offensive vs. Defensive Strategic
Market Plans (cont.)
Defensive -- Designed to protect market positions
and profitability:
Protecting profitable market positions
Reducing market focus to improve profitability
Harvesting and divestment
Critical to current share, sales, and profit
performance
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Product Market Diversification
A Diverse Portfolio Offers Opportunities for
Increased Growth and Risk Reduction
Offers new market and segment opportunities
Reduces dependence on any single product-market
Can smooth overall performance by offsettingcompetitive conditions and product life cycles with
different product-markets
Each product-market in a businesss portfolio of
offerings in some way contributes to both the short-run
and the long-run performance of the business.
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Strategic Marketing Planning Process
Starts with an assessment of:
1. Current Business Performance
2. Market Attractiveness
3. Competitive Advantage
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Figure 11.3
Strategic Marketing Planning Process
1. 2. 3.
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The Boston Consulting GroupsGrowth-Share Matrix20%-18%-16%-
14%-12%-10%-8%-
6%-4%-2%-
0Marke
tG
row
th
Rate
10x 4x 2x 1.5x 1xRelative Market Share
.5x .4x .3x .2x .1x
Dogs 8
7
3
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Question marks
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Cash cows
6
Stars
5
4
1. Business Performance
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Figure 11.4
Factors That Shape Market Attractiveness
2. Market Attractiveness
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Fig 11.5: Indexing Market Attractiveness of a Market
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Determinants of a Competitive
Advantage
1. Differentiation Advantage a sustainable product
or service advantage that translates into a benefit
important to target customer
2. Cost Advantage A sustainable lower cost relativeto competition
3. Marketing Advantage A sustainable advantage
over competitors in either channels of distribution,
sales force, or marketing communications
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Fig 11.6 Determinants Competitive Advantage
3. Competitive Advantage
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Fig 11.7 Indexing a Competitive Advantage
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g . : or o o na ys s ra eg c r gPlansNine Cell Market Attractiveness-CompetitiveAdvantage Matrix
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Figure 11.8: Portfolio Analysisand Strategic Marketing Plans
Grow - Invest to improve or grow competitive advantage. In anunderdeveloped or emerging market, this can also mean to invest in
order to grow the market, and hence, its attractiveness.
Entry Invest to enter an attractive market to establish a desiredcompetitive advantage. This strategy could also require investment to
accelerate the growth of a new or underdeveloped market.
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Figure 11.8: Portfolio Analysisand Strategic Marketing Plans
Grow - Invest to improve or grow competitive advantage. In an
underdeveloped or emerging market, this can also mean to invest in
order to grow the market, and hence, its attractiveness.
Protect Invest to protect or hold a competitive advantage.Businesses often fail to invest in hold strategies, and the result is an
erosion of competitive advantage.
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Figure 11.8: Portfolio Analysisand Strategic Marketing Plans
Protect Invest to protect or hold a competitive advantage.
Businesses often fail to invest in hold strategies, and the result is an
erosion of competitive advantage.
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Figure 11.8: Portfolio Analysisand Strategic Marketing PlansGrow - Invest to improve or grow competitive advantage. In anunderdeveloped or emerging market, this can also mean to invest in order
to grow the market, and hence, its attractiveness.
Protect Invest to protect or hold a competitive advantage. Businesses
often fail to invest in hold strategies, and the result is an erosion of
competitive advantage.
Harvest Adjust prices and marketing expenses to gradually exit the
market while attempting to maximize profits during this gradual exit.
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Figure 11.8: Portfolio Analysisand Strategic Marketing PlansGrow - Invest to improve or grow competitive advantage. In an
underdeveloped or emerging market, this can also mean to invest in order
to grow the market, and hence, its attractiveness.
Protect Invest to protect or hold a competitive advantage. Businesses
often fail to invest in hold strategies, and the result is an erosion ofcompetitive advantage.
Focus Selectively narrow market focus to profitable segments or niches
within a segment in order to capture profits while limiting the resources
committed to this market.
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Figure 11.8: Portfolio Analysisand Strategic Marketing PlansGrow - Invest to improve or grow competitive advantage. In an
underdeveloped or emerging market, this can also mean to invest in order
to grow the market, and hence, its attractiveness.
Protect Invest to protect or hold a competitive advantage. Businesses
often fail to invest in hold strategies, and the result is an erosion of
competitive advantage.
Focus Selectively narrow market focus to profitable segments or niches
within a segment in order to capture profits while limiting the resourcescommitted to this market.
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Figure 11.8: Portfolio Analysisand Strategic Marketing PlansDivest Quick divestment from a market. When there are no short-termprofits to be gained with a divest strategy, an immediate exit strategy is
appropriate.
Harvest Adjust prices and marketing expenses to gradually exit the
market while attempting to maximize profits during this gradual exit.
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Figure 11.8: Portfolio Analysisand Strategic Marketing Plans
Divest Quick divestment from a market. When there are no short-term
profits to be gained with a divest strategy, an immediate exit strategy is
appropriate.
Harvest Adjust prices and marketing expenses to gradually exit the
market while attempting to maximize profits during this gradual exit.
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Figure 11.8: Portfolio Analysisand Strategic Marketing PlansProtect Invest to protect or hold a competitive advantage. Businesses
often fail to invest in hold strategies, and the result is an erosion ofcompetitive advantage.
Harvest Adjust prices and marketing expenses to gradually exit the
market while attempting to maximize profits during this gradual exit.
Figure 11 11
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Figure 11.11
Zi-Techs Acoustics Current Performance
Protect Grow Focus Harvest Divest
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Figure 11.12: Zi-Tech Portfolio
Analysis and Strategic Market Plan