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OHT 20.1
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Strategic marketing
OHT 20.2
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Interaction between marketingand corporate strategy
Figure 20.1
OHT 20.3
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Corporate versus marketing strategy
Corporate strategy:
• Allocation of resources within an organisation to achieve the business direction and scope specified within corporate objectives.
• Helps to control and co-ordinate the different areas of the organisation.
Marketing strategy:
• Defines target markets, direction and requirements in order to create a defensible position compatible with the overall corporate strategy.
OHT 20.4
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Marketing plans and programmes
Marketing plan:
• Turning strategies into implementable actions.
• A detailed written statement specifying target markets, marketing programmes, responsibilities, time scales and resources to be used within the defined budgets.
Marketing programmes:
• Actions, often tactical, using marketing mix variables to gain advantage within target market.
• Means of implementing the marketing strategy.
• Normally detailed in the marketing plan.
OHT 20.5
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Influences on marketing strategy
Figure 20.2
OHT 20.6
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Strategic marketing analysis models
All of these models view products as:
• Manageable individual entities on an operational basis.
• A product portfolio (set of products each of which make a unique contribution to the corporate picture) on a strategic basis.
OHT 20.7
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Analysis models
• Boston Box.
• GE matrix.
• Shell’s directional policy matrix.
OHT 20.8
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
The Boston Box
Figure 20.3
OHT 20.9
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Boston Box
• Dog - holds a weak market share in a low growth market.
• Question mark - high market growth with low share.
• Star - a market leader in a growth market.
• Cash cow - as market growth starts to trail off, stars can become cash cows.
• War horses - market leaders, whose cash generating position under threat due to negative market growth.
• Dodos - low share of a declining market means that sales are dwindling away.
OHT 20.10
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
GE matrix
Figure 20.4
OHT 20.11
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Shell’s directional policy matrix
Figure 20.5
OHT 20.12
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Analytical models - the advantages
• Useful planning tools.
• Forces managers to think more strategically.
• Useful diagnostic tools giving overview of current position.
• Can stimulate debate on possible consequences of actions.
OHT 20.13
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Analytical models - the constraints
• Do not give solutions.
• Simplistic use of variables.
• Fail to consider synergies between businesses.
OHT 20.14
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Types of growth
• Market penetration.
• Market development.
• Product development.
• Diversification - concentric, conglomerate.
• Integration - backward, forward, horizontal.
• No growth - harvesting, entrenchment, withdrawal.
OHT 20.15
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Competitor analysis
A systematic attempt to identify and understand key elements of a competitor’s strategy in terms of objectives, strategies, resource allocation and implementation through the marketing mix.
OHT 20.16
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Porter’s Five Forces Model
1. Bargaining power of suppliers.
2. Bargaining power of customers.
3. Threat of new entrants.
4. Threat of substitute products or services.
5. Rivalry among current competitors.
OHT 20.17
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Strategic groupings
Figure 20.8Source: Adapted from Wilson et al. (1992).
OHT 20.18
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Examining competitive strengths and weaknesses
• Provides a valuable insight into their strategic thinking and actions.
• Requires use of various information sources.
• Consider in terms of critical success factors.
• Rate competitors according to their strong and vulnerable points.
• Information can be used to plan and launch attack.
OHT 20.19
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Useful information about competitors
Table 20.2Source: Wilson et al. (1992).
OHT 20.20
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Generic strategies
Figure 20.9
OHT 20.21
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Choice of generic strategy
• Fit between the demands of the strategy and the organisation’s capabilities and resources.
• The main competitor’s abilities on similar criteria.
• The key criteria for success in the market and their match with the organisation’s capabilities.
OHT 20.22
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Competitive positions and strategy
Figure 20.10
OHT 20.23
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Attacking and defending
• Aggressive strategies - frontal, flank, encirclement, bypass, and guerrilla attacks.
• Defence strategies - fixed position, mobile, flanking, contraction, counter offensive.
OHT 20.24
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Attack strategies
Figure 20.11Source: Kotler and Singh (1981). Reproduced with permission of Thomson Media, Eleven Penn Plaza, New York, NY 10001
OHT 20.25
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Defence strategies
Figure 20.12Source: Kotler and Singh (1981). Reproduced with permission of Thomson Media Eleven Penn Plaza, New York, NY 10001.
OHT 20.26
© Pearson Education Limited 2003Brassington and Pettitt: Principles of Marketing, 3rd Edition
Co-operative and independent strategies
Many situations can also be characterised by peaceful coexistence and co-operative alliances between competitors.
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