OHT 20.1

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Strategic marketing

OHT 20.2

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Interaction between marketing

and corporate strategy

Figure 20.1

OHT 20.3

Pearson Education Limited 2003 Brassington 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 2003 Brassington 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Influences on marketing strategy

Figure 20.2

OHT 20.6

Pearson Education Limited 2003 Brassington 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Analysis models

Boston Box.

GE matrix.

Shells directional policy matrix.

OHT 20.8

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

The Boston Box

Figure 20.3

OHT 20.9

Pearson Education Limited 2003 Brassington 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

GE matrix

Figure 20.4

OHT 20.11

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Shells directional policy matrix

Figure 20.5

OHT 20.12

Pearson Education Limited 2003 Brassington 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 2003 Brassington 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 2003 Brassington 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Competitor analysis

A systematic attempt to identify and understand key

elements of a competitors strategy in terms of objectives, strategies, resource allocation and

implementation through the marketing mix.

OHT 20.16

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Porters 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Strategic groupings

Figure 20.8 Source: Adapted from Wilson et al. (1992).

OHT 20.18

Pearson Education Limited 2003 Brassington 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Useful information about competitors

Table 20.2 Source: Wilson et al. (1992).

OHT 20.20

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Generic strategies

Figure 20.9

OHT 20.21

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Choice of generic strategy

Fit between the demands of the strategy and the organisations capabilities and resources.

The main competitors abilities on similar criteria.

The key criteria for success in the market and their match with the organisations capabilities.

OHT 20.22

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Competitive positions and strategy

Figure 20.10

OHT 20.23

Pearson Education Limited 2003 Brassington 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 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Attack strategies

Figure 20.11 Source: Kotler and Singh (1981). Reproduced with permission of Thomson Media, Eleven Penn Plaza, New York, NY 10001

OHT 20.25

Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition

Defence strategies

Figure 20.12 Source: Kotler and Singh (1981). Reproduced with permission of Thomson Media Eleven Penn Plaza, New York, NY 10001.

OHT 20.26

Pearson Education Limited 2003 Brassington 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.