Week02 Macro Environment

7/28/2019 Week02 Macro Environment

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Strategic Marketing OverviewMacro View and Strategic Direction


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Macro Environment Market Analysis Competitors


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SITUATION ANALYSIS

Marketing Planning Process

OBJECTIVES and POSITIONING

STRATEGIES & TACTICS

1. Generic/ Growth Strategies

2. Marketing Mix:

(Products & Services; Price; Place;Promotion)

BUDGET

EXECUTION & CONTROL

EVALUATIONSource: Rothschild (1992)

MISSION


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Chance favors the prepared mind.

- Louis Pasteur


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Strategic Marketing Planning

Strategic analysis of the externalmarketing environment

Market information and intelligence

Strategic analysis of the internalmarketing environment

Determine a Strategic best fit basedon the conclusions from the above

University ofGloucestershire BusinessSchool 5

Everest Mountain Climbing

You better have a good map andknow how to read it

You better understand weatherpatterns and know what you canhandle

You better know your team well,their capabilities and limitations

You need the right equipment forthe job and you need to know how touse it.

The plan of attack better have all ofthis in mind.


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University of Gloucestershire Business School

Macro Environment

economy, technology, culture, legislation,politics, infrastructure

Competitive or Operating Environment customersintermediaries, suppliers, existing and potential competitors,

employees, media, administrators, interest groups.

Source; West, Ford and Ibrahim (2006)

Operational or Internal Environment Corporate policy, competitive strategy,management

systems, resources & capabilities

Management Decision Makers


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Marketing Audit / Planning

External Analysis Customers Competitors

Markets

PEST

Suppliers

Intermediaries

Opportunities and

Threats

Internal Analysis

Performance:- market; financial;

processes; culture

Resources, capabilities

and competencies

Brand and product

portfolio

Strengths andWeaknesses

Marketing programmesMarketing mix tactics

(7Ps or 4Ps)

Adapted from Flynn (1999),

Dibb et al. (2006) &Drummond and Ensor,

(2001), West et al. (2006)

Organisational mission,

goals and corporate

objectives

9

Marketing StrategyAchieving a superior competitive

position within a defined market

Products to offer

Market segments to target

Market positioning

Competitive position tactics

Relationship strategies

Marketing objectives

Implementation,Monitoring and ControlSchedules and budgets

Generating strategic options:

Portfolio models (E.g. BCG, GE)

ANSOFF

Strategies for leaders,

challengers, etc


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External

Analysis

Strategic Decisions

Where to compete

How to compete

Analysis

Information-need areas

Scenario analysis

Identification

Trends/future events

Threats/opportunities

Strategic uncertainties

Figure 3.1


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David Aaker, DamienMcLoughlin, Strategic MarketManagement EuropeanEdition, 0470059869, Copyright 2007 John Wiley &Sons Ltd

9

What will the

future demand?

Performance improvements?

Competitive technological

developments?

Financial capacity of industry?

You cant just ask customers what they

want and then try to give that to them. Bythe time you get it built, theyll want

something new.

- Steve Jobs


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2009, Cravens & Piercy


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Threat ofNew Entrants

CompetitiveRivalry

Power ofSuppliers

Power ofBuyers

Threat ofSubstitutes

Adapted from Porter (1980)

Determines industry

profitability/attractiveness

http://youtu.be/mYF2_FBCvXw
http://youtu.be/mYF2_FBCvXwhttp://youtu.be/mYF2_FBCvXw


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The nature of competition in an industry isthe combined outcome of competitivepressures generated by: The move of rivals battling for market share

The entry of new rivals seeking market share

Efforts of firms outside the industry to convincebuyers to switch to their substitute products

The push by suppliers to charge more for their

input The push by buyers to pay less for products


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The five forces model defines the structureand competition in an industry in a way thatreveal:

What forces are driving changes within an

industry The relative strength of each fundamental force

Which fundamental force shape strategicconduct

The strategic moves that rivals are likely tomake


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University of

Gloucestershire BusinessSchool 14

Components of the marketing mix and marketing environment

Differential advantage /Competitive edge

People

Distribution

(place)Price

Product

Promotion

Legal

forces

Regulatory

forces

Societal /

Political

forces

Technological

forces

Economic and

competitive forces

Buyer/

Consumer

Product / Target

forcesGreen

Differential advantage/

Competitive edge

Brandpositioning selection

market

Source: Dibb et al


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Interest rates Inflation rates

Savings, investment, and credit

Unemployment


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Demographics Lifestyle

Attitudes

Consumerism Educational levels


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Population growth Population age mix

Ethnic markets

Educational groups Household patterns

Geographical shifts


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Reading TV Watching

Spending time withfamily

Going to movies Fishing

Computer activities Gardening

Renting movies

Walking

Exercise Listening to music


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Sources of raw materials Energy supply costs

Green issues


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Pace of change Government & industrial R&D expenditure

PLC

Opportunities for innovation


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Political stability Pressure groups

Trade union power


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Legislative structures

Anti-trust laws

Trade policies


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What major trends are discussed? Do you think any / all of this remains true as this

video was shot in November 2010

Does this information ring true for your country

as it was made in the US? What does it mean to us as marketers?

https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701
https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701https://www.mckinseyquarterly.com/Video/Global_forces_shaping_the_future_of_business_and_society_2701


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A market exists only when there are buyerswith needs who have the ability to purchasegoods and services and products are availableto satisfy the needs.

Markets are comprised of groups of peoplewho have the ability and willingness to buy

something because they have a need (valuerequirement for it).

2009, Cravens & Piercy


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Price pressure caused by overcapacity and thelack of product differentiation

Buyer sophistication and knowledge

Substitute products or technologies

Saturation

No growth sources

Customer disinterest

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David Aaker, DamienMcLoughlin, Strategic MarketManagement EuropeanEdition, 0470059869, Copyright 2007 John Wiley &

Sons Ltd26

Competitive Risk

OvercrowdingSuperior competitive entry

Market Changes

New technology

Disappointing growth

Price instability

Firm Limitations

Resource constraintsDistribution unavailable

Figure 5.5

Risks ofHigh-Growth

Market


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Strategic Groups

Pursue similar competitive strategies

Have similar characteristics Have similar assets and competencies

David Aaker, DamienMcLoughlin, Strategic MarketManagement EuropeanEdition, 0470059869, Copyright 2007 John Wiley &

Sons Ltd28


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Potential Competitors Market expansion

Product expansion

Backward integration

Forward integration

The export assets or competencies

Retaliatory or defensive strategies

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d d h


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Understanding theCompetitors

Objectives and

Commitment

Image and

PositioningSize, Growth

& Profitability

Current and

Past StrategiesStrengths and

Weaknesses

Cost Structure

Exit Barrriers Organisation

and Culture

Competitor

Actions

Figure 4.3

Figure 4.3


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Strategic analysis must take place on many levels

to capture the multitude of interactive dynamicseffecting a company.

Numerous tools and models are available toassist in the data collection and analysis process.

Ultimately, strategic marketing managers mustdecide a strategic best fit, between externalopportunities and internal strengths whileworking around external threats and internalweaknesses.

Every plan must be continually monitored andadapted as the environment changes.

University ofGloucestershire Business

Documents

Week02 Macro Environment