MARKETING STRATEGYOctober 13, 2018
“STRATEGY WITHOUT TACTICS IS THE SLOWEST ROUTE TO VICTORY
TACTICS WITHOUT STRATEGY IS THE NOISE BEFORE DEFEAT”
Marketing strategy is a long-term, forward-looking approach to planning with the fundamental goal achieving a sustainable competitive advantage. Strategic planning involves an analysis of the company’s strategic initial situation prior to the formulation, evaluation and selection of market-oriented competitive position that contributes to the company’s goals and marketing objectives.
Strategic marketing, as a distinct field of study emerged in the 1970s, and built on strategic management that preceded it. Marketing strategy highlights the role of marketing as a link between the organisation and its customers.
At its most basic level, strategic marketing addresses three deceptively simple questions: (1) Where are we now? (2) Where are we going? and (3) How are we going to get there? In attempting to answer these questions, strategic planners require sophisticated skills in both research and analysis.
Scholars continue to debate the precise meaning of marketing strategy. Consequently, the literature offers many different definitions. On close examination, however, these definitions appear to centre around the notion that strategy refers to a broad statement of what is to be achieved.
Marketing Strategy is:
- “The marketing strategy lays out target markets and the value proposition that will be offered based on an analysis of the best market opportunities.” (Philip Kotler & Kevin Keller, Marketing Management, Pearson, 14th Edition)
- “An over-riding directional concept that sets out the planned path.” (David Aaker and Michael K. Mills, Strategic Market Management, 2001, p. 11)
- “Essentially a formula for how a business is going to compete, what its goals should be and what policies will be needed to carry out these goals.” (Michael Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors , NY, Free Press, 1980)
- “The pattern of major objectives, purposes and goals and essential policies and plans for achieving those goals, stated in such a way as to define what business the company is in or is to be in. (S. Jain, Marketing Planning and Strategy, 1993)
- “An explicit guide to future behaviour.” (Henry Mintzberg, “ Crafting Strategy,” Harvard Business Review, July–August, 1987 pp. 66–74)
- Strategy is “reserved for actions aimed directly at altering the strengths of the enterprise relative to that of its competitors… Perfect strategies are not called for. What counts is… performance relative to competitors.” (Kenichi Ohmae, The Mind of the Strategist, 1982, p. 37)
- Strategy formulation is built on “the match between organisational resources and skills and environmental opportunities and risks it faces and the purposes it wishes to accomplish.” (Dan Schendel and Charles W. Hofer, Strategy Formulation: Analytical Concepts, South-Western, 1978, p. 11)
Developing the vision and mission
The vision and mission address the second central question, ‘Where are we going?’ At the conclusion of the research and analysis stage, the firm will typically review its vision statement, mission statement and, if necessary, devise a new vision and mission for the outlook period. At this stage, the firm will also devise a generic competitive strategy as the basis for maintaining a sustainable competitive advantage for the forthcoming planning period.
A vision statement is a realistic, long term future scenario for the organisation. (Vision statements should not be confused with slogans or mottos.) A vision statement is designed to present a realistic long-term future scenario for the organisation. It is a “clearly articulated statement of the business scope.” A strong vision statement typically includes the following:
- Competitive scope
- Market scope
- Geographic scope
- Vertical scope
Some scholars point out the market visioning is a skill or competency that encapsulates the planners’ capacity “to link advanced technologies to market opportunities of the future, and to do so through a shared understanding of a given product market.
A mission statement is a clear and concise statement of the organisation’s reason for being and its scope of operations, while the generic strategy outlines how the company intends to achieve both its vision and mission.
Mission statements should include detailed information and must be more than a simple motherhood statement. A mission statement typically includes the following:
- Specification of target customers
- Identification of principal products or services offered
- Specification of the geographic scope of operations
- Identification of core technologies and/or core capabilities
- An outline of the firm’s commitment to long-term survival, growth and profitability
- An outline of the key elements in the company’s philosophy and core values
- Identification of the company’s desired public image
Understanding your strengths and weaknesses
Your strategy must take account of how your business’ strengths and weaknesses will affect your marketing.
Begin your marketing strategy document with an honest and rigorous SWOT analysis, looking at your strengths, weaknesses, opportunities and threats. It is a good idea to conduct some market research on your existing customers at this point, as it will help you to build a more honest picture of your reputation in the marketplace.
Strengths could include:
- personal and flexible customer service
- special features or benefits that your product offers
- specialist knowledge or skills
Weaknesses could include:
- limited financial resources
- lack of an established reputation
- inefficient accounting systems
Opportunities could include:
- increased demand from a particular market sector
- using the Internet to reach new markets
- new technologies that allow you to improve product quality
Threats could include:
- the emergence of a new competitor
- more sophisticated, attractive or cheaper versions of your product or service
- new legislation increasing your costs
- a downturn in the economy, reducing overall demand
Having done your analysis, you can then measure the potential effects each element may have on your marketing strategy.
For example, if new regulations will increase the cost of competing in a market where you’re already weak, you might want to look for other opportunities. On the other hand, if you have a good reputation and your key competitor is struggling, the regulations might present the opportunity to push aggressively for new customers.
Developing your marketing strategy
With an understanding of your business’ internal strengths and weaknesses and the external opportunities and threats, you can develop a strategy that plays to your own strengths and matches them to the emerging opportunities. You can also identify your weaknesses and try to minimise them.
The next step is to draw up a detailed marketing plan that sets out the specific actions to put that strategy into practice.
Questions to ask when developing your strategy
- What changes are taking place in our business environment? Are these opportunities or threats?
- What are our strengths and weaknesses?
- What do I want to achieve? Set clear, realistic objectives.
- What are customers looking for? What are their needs?
- Which customers are the most profitable?
- How will I target the right potential customers? Are there groups that I can target effectively?
- What’s the best way of communicating with them?
- Could I improve my customer service? This can be a low-cost way of gaining a competitive advantage over rivals, keeping customers, boosting sales and building a good reputation.
- Could changing my products or services increase sales and profitability? Most products need to be continuously updated to maintain competitiveness.
- Could extending my product list or service provision meet existing customers’ needs more effectively? Remember that selling to existing customers is generally more cost effective than continually trying to find new ones.
- How will I price my product or service? Although prices need to be competitive, most businesses find that trying to compete on price alone is a poor strategy. What else are my customers interested in? Quality? Reliability? Efficiency? Value for money?
- What is the best way of distributing and selling my products?
- How can I best promote my products? Options might include advertising, direct marketing, exhibiting at trade fairs, PR or marketing on the web.
- How can I tell if my marketing is effective? Check how your customers find out about your business. A small-scale trial can be a good way of testing a marketing strategy without committing to excessive costs.