STRATEGIC STRATEGIC MARKETING MARKETING

revisionrevision

What the course has What the course has achieved?achieved?

• To introduce you to a systematic way of thinking about developing marketing strategies

• to familiarise you with current advances and practices in marketing strategy

• to help you develop your analytical and problem-solving skills in marketing

An overviewAn overview

CONVENTIONAL AND NEW CONVENTIONAL AND NEW APPROACHES TO MARKETING APPROACHES TO MARKETING

evolution of marketing thoughtevolution of marketing thoughtthe new marketing environment and the the new marketing environment and the necessity for new approachnecessity for new approachcompetitive rationality theorycompetitive rationality theory

Macro Competitive Rationality

Micro Competitive Rationality

Buyers’ preferences and wants are always being changed by changes in supply.

The variation in consumer demand is constantly changing

Sellers learn directly and by observing other sellers how to serve customers more effectively

Sellers with more acute and less biased perceptions of how the market is changing are more competitive.

The variation in the supply offering is constantly changing

Supply will shift to serve the demand of the most profitable market segments

The economic process changes the economic structure. The economic structure changes the social structure.

Sellers who can implement their innovations and imitations faster are more competitive.

Markets are always in disequilibrium. Competition increases when supply exceeds demand.

Sellers who possess an insatiable self-improvement drive are more competitive.

Effective product and process innovations are quickly imitated and improved

Sellers are driven by competition to experiment with new, innovative ways of serving customers

The Macro and Micro Theories of Competitive Rationality

Trends that affect marketingTrends that affect marketing1.1. Corporate Corporate disdis--integration and networking integration and networking

(movement to outsourcing, partnering, and (movement to outsourcing, partnering, and strategic alliances)strategic alliances)

2.2. DeDe--functionalisationfunctionalisation of marketing and the of marketing and the diffusion of marketing responsibilities diffusion of marketing responsibilities throughout the organizationthroughout the organization

3.3. The digital economyThe digital economy4.4. Malignant price erosion (i.e., sales promotion Malignant price erosion (i.e., sales promotion

addiction)addiction)5.5. Shift from resourceShift from resource--based to informationbased to information--

based economybased economy6.6. Firms without borders (globalisation)Firms without borders (globalisation)

Forces Shaping Marketing’s Role

The new view of marketing focuses The new view of marketing focuses on: on:

customers (not products), customers (not products), responsiveness and organizational capabilities responsiveness and organizational capabilities (not control), (not control), marketing as process (not function), marketing as process (not function), customer value (not the four Ps), customer value (not the four Ps), relationships (not transactions), relationships (not transactions), networked organizations (not bureaucracies), networked organizations (not bureaucracies), andandmultiple buying motives (not simply price)multiple buying motives (not simply price)

Reading for the examsReading for the exams

1. The Decline and Dispersion of Marketing Competence. By: Webster Jr., Frederick E.; Malter, Alan J.; Ganesan, Shankar. MIT Sloan Management Review, Summer2005, Vol. 46 Issue 4, p35-43

STRATEGY MAKING AND PLANNING STRATEGY MAKING AND PLANNING

what is strategy and what planningwhat is strategy and what planninghow strategies are developedhow strategies are developedwhat is wrong with traditional/formal what is wrong with traditional/formal strategic planning strategic planning

Deliberate and Emergent Deliberate and Emergent StrategiesStrategies

IntendedStrategy

Emergent Strategy

Realised Strategy

UnrealisedStrategy

Deliberate Strategy

A Framework for Planning, A Framework for Planning, Planners and PlansPlanners and Plans

StrategicAnalysis(planners)

StrategyFormation Finding

Strategies(planners)

ScrutinisingStrategies(planners)

CodifyingStrategies

Elaborating &ConvertingStrategies

Strategic Programming(planning)

External Communicationand Control(plans)

InternalCommunicationand Control(plans)

Plans as simulations

Plans as controls

Catalysts(planners)

STRATEGY MAKING AND PLANNING STRATEGY MAKING AND PLANNING

Reading for the examReading for the exam1.1. The fall and rise of strategic planning.The fall and rise of strategic planning.; ;

By: By: MintzbergMintzberg, , Henry., Harvard Henry., Harvard Business Review, Jan/Feb94, Vol. 72 Business Review, Jan/Feb94, Vol. 72 Issue 1, p107, 8p;Issue 1, p107, 8p; ,,

THE MARKETING STRATEGY THE MARKETING STRATEGY MAKING PROCESSMAKING PROCESS

marketing decision makingmarketing decision makinghow marketing strategy is integrated to the how marketing strategy is integrated to the business strategybusiness strategywho and how should develop marketing who and how should develop marketing strategiesstrategiesthe annual marketing planning the annual marketing planning

NOT IN THE EXAMNOT IN THE EXAM

Informal Decision Making

Formal Decision Making

General Manager

R&D engineer

Production Manager Designer

Sales/ marketing manager Financial

officer

Annual Audit of Decision Making

Discussion among executives

Monthly executive planning meetings

Discussion of changes in marketplace environment

Reporting of problems with implementation

Discussion of a new idea or project

Reporting of changes in marketplace by everyone

Reporting of implementation progress by everyone

Discussion of new strategies and project ideas

Reassessment and updating of plan

.

.

.....

.Formal annual planning reportUpdate written environmental analysis and sales and share forecastsSummarise strategies and projects adopted, in process, and to be implemented

Checking of environment-strategy fit

Development and approval of budget and action plans

.

..

Continuous Marketing Decision Making

Achieving competitive Achieving competitive advantageadvantagedefining and assessing an defining and assessing an organisationorganisation’’s competitive advantages competitive advantagedeveloping competitive advantagesdeveloping competitive advantagesidentifying and enhancing the identifying and enhancing the capabilities of market driven capabilities of market driven organisationsorganisations

Achieving competitive advantageAchieving competitive advantage

1.1. Assessing Advantage: A Framework for Assessing Advantage: A Framework for Diagnosing Competitive Superiority.Diagnosing Competitive Superiority. By: Day, By: Day, George S.; George S.; WensleyWensley, Robin. Journal of Marketing, , Robin. Journal of Marketing, Apr88, Vol. 52 Issue 2, p1, 20p Apr88, Vol. 52 Issue 2, p1, 20p

2.2. The capabilities of marketThe capabilities of market--driven organizationsdriven organizations..By: Day, George S.. Journal of Marketing, Oct94, By: Day, George S.. Journal of Marketing, Oct94, Vol. 58 Issue 4, p37, 16p Vol. 58 Issue 4, p37, 16p

3.3. What does it mean to be marketWhat does it mean to be market--driven?driven? By: By: DayDay, , GeorgeGeorge S.. Business Strategy Review, Spring98, S.. Business Strategy Review, Spring98, Vol. 9 Issue 1, p1, 14pVol. 9 Issue 1, p1, 14p

FOCUSING MARKETING STRATEGIES: FOCUSING MARKETING STRATEGIES: SEGMENTATION AND POSITIONINGSEGMENTATION AND POSITIONING

•• benefit segmentation and how is benefit segmentation and how is conductedconducted

•• developing positioning maps and developing positioning maps and identifying viable positionsidentifying viable positions

A Model of Consumer Behaviour for Deep Benefit Segment

To understand what uses and situation differences drive different benefits and features sought

Unfolding the causes and effects of the different benefit segments

To understand how benefits influence perceptions, choices, and behaviour

User differences:•Income•Life cycle•Lifestyle

Situation usage differences:•Physical•Social•Psychological

•Different benefits sought•Different product features/specifications sought

Relationship between person and situation

•Beliefs and ratings•Choice rules

Relationship between behaviours

•Brand loyalty•Heavy usage

•Price sensitivity•Shopping behaviour

Effectiveness (efficacy)

Gentleness (side effects)

Demand void

Private-label aspirin Anacin

Bayer

BufferinAdvil

Generic acetaminophen

Segment cluster 1Age=5+5Use: fever

Segment cluster 2Age=70+10Use: arthritis

Segment cluster 3Age=30+10Use: aches

Extra-Strength TylenolTylenolDatril

An Intuitive Map of the Analgesic Market

Readings for the examsReadings for the exams

1.1. A segmentation you can act on.A segmentation you can act on. By: By: Forsyth, John; Gupta, Sunil; Forsyth, John; Gupta, Sunil; HaldarHaldar, , SudeepSudeep; ; KaulKaul, Anil; Kettle, Keith. , Anil; Kettle, Keith. McKinsey Quarterly, 1999 Issue 3, p6, McKinsey Quarterly, 1999 Issue 3, p6, 10p, 10p,

2.2. What's your position?What's your position?; By: ; By: WynerWyner, , Gordon; Owen, Hilary., Marketing Gordon; Owen, Hilary., Marketing Research, Winter94, Vol. 6 Issue 1, p54,Research, Winter94, Vol. 6 Issue 1, p54,

Customer Equity and Value Customer Equity and Value StrategiesStrategies

customer equity and its drivers• customer value and strategies that

increase customer value• identifying sources of value innovation

Drivers of customer equityDrivers of customer equity

Readings for the examReadings for the exam1.1. What Drives Customer Equity?What Drives Customer Equity? By: By: Lemon, Lemon,

Katherine N.Katherine N.. Marketing Management, Spring2001, . Marketing Management, Spring2001, Vol. 10 Issue 1, p20, Vol. 10 Issue 1, p20,

2.2. Where Should the Next Marketing Dollar Go?Where Should the Next Marketing Dollar Go? By: By: Rust, Roland T.; Rust, Roland T.; Lemon, Katherine N.; N.; ZeithamlZeithaml, , Valarie A.. Marketing Management, Sep/Oct2001, Valarie A.. Marketing Management, Sep/Oct2001, Vol. 10 Issue 3, p25, 4p, 1 diagram Vol. 10 Issue 3, p25, 4p, 1 diagram

3.3. How Increasing Value to Customers Improves How Increasing Value to Customers Improves Business Results.Business Results. By: By: VandermerweVandermerwe, Sandra. Sloan , Sandra. Sloan Management Review, Fall2000, Vol. 42 Issue 1, p27, Management Review, Fall2000, Vol. 42 Issue 1, p27, 11p, 4 diagrams 11p, 4 diagrams

BRAND EQUITYBRAND EQUITY

Building, maintaining and reinforcing brand equityHow brand equity generates value

Brand equity driversBrand equity drivers

Brand elements or identities (Names, Web URLs, logos, symbols, characters, slogans, jingles, packaging, and signage) [should be memorable, meaningful, likable, transferable, adaptable and able to be protected]

Product and service and all accompanying marketing activities and programsOther associations marketers indirectly transfer to the brand

Readings for examReadings for exam1.1. Building CustomerBuilding Customer--Based Brand Based Brand

EquityEquity.. By: Keller, Kevin Lane., Marketing By: Keller, Kevin Lane., Marketing Management, Jul/Aug2001, Vol. 10 Issue 2, Management, Jul/Aug2001, Vol. 10 Issue 2, p14, 6p, p14, 6p, available online atavailable online at Business Business Source PremierSource Premier

2.2. Branding Shortcuts.Branding Shortcuts. By: By: Keller, Kevin LaneKeller, Kevin Lane. . Marketing Management, Sep/Oct2005, Vol. Marketing Management, Sep/Oct2005, Vol. 14 Issue 5, p1814 Issue 5, p18--23, 6p; 23, 6p;

3.3. How Do Brands Create Value?How Do Brands Create Value? By: By: Keller, Keller, Kevin LaneKevin Lane; Lehmann, Donald R.. Marketing ; Lehmann, Donald R.. Marketing Management, May/Jun2003, Vol. 12 Issue 3, Management, May/Jun2003, Vol. 12 Issue 3, p26p26--31, 6p,31, 6p,

Customer retentionCustomer retention

market-relating capabilities and market relationshipsdesigning a relationship (CRM) strategy

Readings for examReadings for exam1. 1. Managing Market Relationships.Managing Market Relationships. By: Day, George S.. By: Day, George S.. Journal of the Academy of Marketing Science, Journal of the Academy of Marketing Science, Winter2000, Vol. 28 Issue 1, p24, 7p available onlineWinter2000, Vol. 28 Issue 1, p24, 7p available onlineCreating a Superior Customer-Relating Capability. By: Day, George S.. MIT Sloan Management Review, Spring2003, Vol. 44 Issue 3, p77, 6p 2. 2. The Mismanagement of Customer Loyalty.The Mismanagement of Customer Loyalty. By: By: ReinartzReinartz, Werner; Kumar, V.. Harvard Business , Werner; Kumar, V.. Harvard Business Review, Jul2002, Vol. 80 Issue 7, p86, 9pReview, Jul2002, Vol. 80 Issue 7, p86, 9p3. 3. A Framework for Customer Relationship A Framework for Customer Relationship Management.Management. By: By: WinerWiner, Russell S.. California , Russell S.. California Management Review, Summer2001, Vol. 43 Issue 4, Management Review, Summer2001, Vol. 43 Issue 4, p89, 17p, 4p89, 17p, 4Profitable Relationships.Profitable Relationships. By: Kumar, V.. Marketing By: Kumar, V.. Marketing Research, Fall2006, Vol. 18 Issue 3, p41Research, Fall2006, Vol. 18 Issue 3, p41--46, 6p46, 6p

EXAMEXAM

You have to answer You have to answer THREE (3) THREE (3) questionsquestions out of a choice of FIVEout of a choice of FIVE

Readings for the ExamReadings for the Examcan be accessed at can be accessed at

www.balabanis.comwww.balabanis.com ororhttp://http://staff.city.ac.uk/~georgeb/strategic_marketing.htmstaff.city.ac.uk/~georgeb/strategic_marketing.htm

You will need an Athens username and You will need an Athens username and password (issued by the Library)password (issued by the Library)DO NOT USE CASSLEARNDO NOT USE CASSLEARN

Questions?Questions?