Market-Oriented Perspectives Underlie Successful Corporate, Business, and Marketing Strategies

1. Market-Oriented Perspectives Underlie Successful Corporate, Business, and Marketing Strategies 1

2. Discussion Question • Companies often talk about their strategies. What does strategy mean? A fundamental pattern of present and planned objectives, resource deployments, and interactions of an organization with markets, competitors, and other environmental factors.

3. Strategy • Should specify: • What is to be accomplished. • Where? On which industries or markets will it focus/ • Which resources and activities will be allocated to each product-market to meet environmental opportunities and threats and gain a competitive advantage?

4. Exhibit 1.3Components of Strategy • Scope • Goals and objectives • Resource deployments • Identification of sustainable competitive advantage • Synergy

11. Discussion Question • What do marketers mean when they say their firms are market oriented? • Peter Drucker: The purpose of any business is to win a customer • True for all parts of the organization, i.e., cross-functional coordination • The above should result in superior long-term profitability

14. Discussion Questions • Does having a market orientation make sense? What are the advantages and drawbacks?

15. Discussion Questions • Advantages • Promotes listening to the customer • Happier customers more likely to be more loyal – good for long term profitability • More customer and competitive information is likely to be obtained and used – good for profitability • More likely to identify changes in market and competitive conditions – avoid being blindsided • If the first two steps are done well, the third should take care of itself • Helps employees focus on profit, not sales volume

16. Discussion Questions • Possible drawbacks • May lead the firm to seek to satisfy all customer groups – a possible prescription for disaster • Customers may not be able to articulate what they really want and need – and will pay for! • Current customers may not be the most attractive target – must avoid tyranny of current customers, if others are more attractive • Implies tailoring products to different needs of different segments – may be costly • Implies need for research – costs money, may slow reaction to market changes

17. Discussion Question • What must marketing managers understand to engage in effective marketing practice? What do companies need to analyze before they come up with marketing strategies?

18. Discussion Question • The company: resources, capabilities, and strategies [Strengths, Weaknesses] • The environmental context: broad trends [Opportunities, Threats] • Current and potential customers: needs, wants, characteristics [Opportunities] • Competitors: strengths, weaknesses, competitive trends [Opportunities, Threats] • In other words, the 4 Cs [SWOT]

19. Discussion Question • Which should come first – the customer need or the product idea?

20. Discussion Question • Post-It notes (idea first – an accident). • Many hi-tech products (idea first). • Gatorade (need first – Florida Gators football team). • Ultimately, either starting point is okay. In the end, however, a genuine want or need must be filled or no one will buy.

21. Discussion Question • Why do some firms lack orientation towards the market?

22. Discussion Question • Some of the reasons why firms lack focus on their customers or competitors include: • competitive conditions which may allow a company to be successful in the short-run without being particular sensitive to customer needs • different level of economic development across industries or countries which may favor different business philosophies • strategic inertia whereby marketing strategy does not reflect changes in customers needs and competitive offerings

23. Discussion Question • What sort of decisions must marketing managers make to effectively serve customer needs?

24. Discussion Question • Product decisions: what must be decided here? • Pricing decisions: what must be decided here? • Promotion decisions: what must be decided here? • Place (distribution) decisions: what must be decided here? • In other words, the 4 Ps – Marketing Mix

26. Discussion Question • So, if one were to plan the various things to be done to market a new product, what are the basic elements that such a plan would consist of?

27. Discussion Question • Identify company objectives for the new product • Market analysis: to understand market context and customer wants and needs • Competitor analysis • A marketing strategy: the 4 Ps

28. Discussion Questions • Are planned results always delivered in most organizations? What else might you want to include?

29. Discussion Questions • No: performance targets are often missed, of course. To better ensure delivery of planned performance, a good marketing plan should include: • Sales forecasts and pro forma budgets against which to measure results • Plan for implementation and control

30. Exhibit 1.10Contents of a Marketing Plan (1of 2 slides) • Executive summary • Current situation and trends • Performance review • Key issues • Objectives

31. Exhibit 1.10Contents of a Marketing Plan(2 of 2 slides) • Marketing strategy • Action plans • Projected profit-and-loss statement • Controls • Contingency plans