MKTG 324 - Corporate Strategy and Marketing Environment

Steps of the Marketing Process

1. Understand marketplace and customer preferences

2. Design customer focused strategy

3. Bring strategy to life —> construct integrated marketing mix

4. Combine the previous steps to engage customers and build relationships

5. Capture the value (profits and customer equity)

Step 1.) Understand market concepts

assess the needs, wants, and demands of customers

needs

state of felt deprivation

wants

human needs new form shaped by culture/personality

demands

wants that are backed by consumer’s purchasing power

Steps 2 and 3.) finding value and trying to bring customer satisfaction

Value: set of benefits/values promised to delivery customer needs

S. segmentation

T. targeting
P. positioning

Production orientation

a business philosophy where a company prioritizes manufacturing efficiency, low production costs, and mass distribution over individual customer desires

downside: market myopia (no understanding/fulfillment of customer needs)

Product orientation

a business approach that focuses primarily on product quality, design, and internal engineering, operating on the belief that a superior product will naturally attract and satisfy customers

downside: every product is just. a “better mousetrap” (new technology will always be made)

selling orientation

a business approach that focuses on aggressive selling and promotion of existing products rather than first researching and satisfying customer needs

downside: compromises long term relationships with customers

marketing orientation

a business approach that prioritizes identifying the needs, wants, and preferences of consumers and shaping product development to satisfy them (CUSTOMER focused)

societal marketing orientation

balances company profits, customer satisfaction, and the long-term well-being of society and the environment (customer AND society focused, stakeholder focused)

Step 4.) Customer Relationship Management (CRM) and Engagement

build an emotional connection to brand, utilize tools like social media

Step 5.) Capture value

value can be through loyalty/retention, customer life-time value (CLV)

Customer Life-time Value (CLV)

life time purchases/value from customers

(value doesn’t always depend on total $$$)

Steps to strategic planning

Define mission —> set goals —> design portfolio —> develop plan

Strategic Planning Step 1.) Mission statement

= purpose + scope

Who do we serve? what do we do? why do we exist?

Strategic Planning Step 2.) Set goals

Setting goals makes the company’s mission actionable. goals should be SMART

break down company goals in flow corporate (top level vision) —> business unit (product/division level) —> functional (department level)

Strategic Planning Step 3.) Portfolio Analysis

collection of businesses and products of a company

The analysis of this portfolio aims to allocate resources for growth and profitability

To analyze a company’s portfolio look into Strategic Business Units (SBU)

SBU is what makes up the portfolio (divisions, products, brands)

Steps of analyzing a SBUs

identify the SBU —> assess its attractiveness —> decide how much support

BCG Growth Matrix

analyzes portfolio by looking at the market growth rate and the company’s market share

BCG Growth Matrix - Star

High share, high growth —> keep pushing (invest)

BCG Growth Matrix - Cash Cow

low growth, high share —> MILK (harvest)

BCG Growth Matrix - Question Mark

low share, high growth —> unsure of what to do (hold)

BCG Matrix - Dog

low share, low growth —> divest

Product/Market Expansion (Ansoff) matrix

that helps businesses evaluate and plan risk-based growth strategies using new or existing products and markets

Ansoff Matrix - Existing Product + Existing Market

market penetration: Focuses on selling more of your current products to your current customer base

Goal: Increase market share and customer loyalty through promotions or competitive pricing

Ansoff Matrix - Existing Product + New Market

market development: Focuses on taking current products and introducing them to a new demographic or geographic location

Goal: Expand your customer reach

Ansoff Matrix - New Product + Existing Market

Product Development: Focuses on creating new or updated products to sell to your current customer base

Goal: Capitalize on existing brand trust and customer relationships

Ansoff Matrix - New Product + New Market

Diversification: Focuses on introducing entirely new products into completely new markets

Goal: Open up completely fresh revenue streams

SWOT Analysis

Strengths (the good + what we have)

Weaknesses (the bad + what we have)

Opportunities/Alternatives (the good + what’s out there)

Threats (the bad + what’s out there)

Strategic Planning Step 4.) Develop plan

Plan centers around a customer value-driven marketing strategy

1. Step 1: STP

2. Design 4 Ps (product, price, place, promotion)

The Process of Marketing Management

Analysis —> planning —> implementation —> control (result)

Marketing ROI

= (sales - marketing cost)/marketing cost

Marketing Environment

factors/forces outside an organization that impact customer relationships

Microenvironment factors

close to a company

company

(micro factor) top management, R&D, IT, accounting/finance departments, HR

suppliers

(micro factor) provides resources to produce goods/products

Marketing intermediaries

(micro factor) firms that help the company sell their goods/products (resellers, distribution firms, marketing agencies)

Competitors

(micro factor) other firms that position themselves to gain strategic advantages over your company

Publics

(micro factor) group that has interest and impact on an organization’s goals (banks, media, government, local/general publics)

customers

(micro factor) those who consume from company

macroenvironment factors

larger societal forces that impact the microenvironment

Examples of macroenvironment forces

demographic, economic, natural, technological, political/social, cultural