Chapter 4: Strategic marketing

decisions, choices, and mistakes

To define strategic choice

To outline strategic decisions taken at the corporate, SBU and functional levels

To review the strategic marketing decisions including products to offer, markets to target and competitive position strategies

To review the analytical models and frameworks that can be used by organisations to make their strategic choices for the future

Strategic choice involves generating a well-justified

set of interrelated strategic alternatives and

choose from them the ones that will contribute to

the achievement of the corporate overall goals and

strategic objectives

It is a single business or collection of related

businesses

It has its own set of competitors

It has a leader responsible for strategic

planning and profitability

SBUs of CavinKare

WHERE DO WE WANT TO BE?

Strategic Decisions

Strategic decisions at the corporate level

Developing mission statement

Directional strategy

Resource allocation

Strategic decisions at the SBU level

Choosing generic strategy (strategic orientation):

Cost leadership strategy

Differentiation strategy

Focus strategy: Cost focus & Differentiation focus

Strategic decisions at the functional level

Products to offer

Market segments to target

Market position tactics

PORTERS GENERIC STRATEGIES

Growth Strategies Stability Strategies Retrenchment strategies

Concentration

Vertical Growth

Horizontal Growth

Diversification

Pause/Proceed with

Caution

No Change

Profit

Turnaround

Captive Company

Sell-Out/Divestment

Bankruptcy/Liquidation

Indust

ry A

ttra

cti

veness

High

Medium

Low

General electric model

Business Position

Strong Medium Weak

Most attractive: Investment for Growth Medium attractiveness: Selectivity Least attractive: Harvesting/Divesting

SHELL DIRECTIONAL MATRIX

Strategic choice involves understanding the underlying bases guiding future strategy, and generating strategic options for evaluation and selecting from among them.

Strategic decisions are usually taken at corporate level (e.g., directional strategy, resource allocation), at SBU level (e.g., generic strategy), and at functional level in relation to various functional areas (e.g., marketing, R&D, finance, HR, production, etc.).

Strategic marketing decisions include products to offer, market segments to target, and positioning strategies.

Organisational failure is arguably a product of repeated strategic mistakes and unsuccessful interactions between the firm and its environment.