Strategy in marketing
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Strategy in Marketing Professor Lawrence Feick University of Pittsburgh Outline What is marketing strategy? Framework for marketing strategy External analysis: environmental scanning Internal analysis: core skills of the firm SWOT: matching the external and internal Portfolio models

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Strategy in marketing l.jpg

Strategy in Marketing

Professor Lawrence Feick

University of Pittsburgh


Outline l.jpg
Outline

  • What is marketing strategy?

  • Framework for marketing strategy

  • External analysis: environmental scanning

  • Internal analysis: core skills of the firm

  • SWOT: matching the external and internal

  • Portfolio models


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Marketing strategy

  • Answers basic questions:

    • to whom will we sell?

    • what will we sell, how will we sell it?

  • Focus on:

    • target market selection

    • marketing mix design


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Marketing strategy formulation

  • External analysis (looking outside the firm)

    • environmental scanning

    • environmental management

    • identifying opportunities and threats

  • Internal analysis (looking inside the firm)

    • mission and objectives

    • key skills, resources of the firm

    • identifying strengths and weaknesses


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External analysis:The key environments

  • Socio-cultural environment

  • Economic environment

  • Technological environment

  • Political-legal environment

  • Competitive environment


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External analysis:The socio-cultural environment

  • Demographics

    • age, education, marital status, race, etc.

  • Culture

    • US culture, subcultures, foreign cultures

    • pop culture, style, fashion, conventional wisdom

    • ideas, movements, causes

  • How is this environment changing?





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External analysis: yearThe economic environment

  • GDP and business cycles

  • Personal income

  • Inflation

  • Unemployment


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External analysis: yearThe technological environment

  • Creation of substitutes for the product category (e.g., marketing myopia examples)

  • Changes in the product or product usage

  • Changes in the production, service, or support process

  • Changes in distribution channels

  • Changes in promotion, media


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External analysis: yearThe political-legal environment

  • Government laws and regulations

    • Maintaining a competitive market

    • Protecting consumers

  • Industry self-regulation

  • Litigation


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External analysis: yearThe competitive environment

  • Who is our competitor?

    • brand-level competition

    • product category-level competition

    • want-level competition

  • Open markets and increased competition

    • global connections

    • emphasis on exports

    • virtual marketing


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External analysis: recap year

Economic

Environment

Socio-cultural

Environment

Technological

Environment

Firms,

Consumers,

Competitors,

and Products

Political-legal

Environment

Competitive

Environment


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External analysis: recap year

  • Five external environments change continually

  • Changes create opportunities and challenges in new and existing markets

  • Marketers’ key jobs:

    • environmental scanning, forecasting, adaptation

    • environmental management (if possible)


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Internal analysis year

  • Motivation: how does the firm choose from among all of the opportunities in the environment?

  • Examples

    • Microsoft

    • Federal Express


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Internal analysis: yearMission

  • The self-defined description of the business the firm is in; why the firm exists

  • Usually includes mention of

    • customer groups served

    • customer needs met

    • technology employed

  • Constrains marketing strategy choices


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Mission statement example year

  • Intel: Do a great job for our customers, employees, and stockholders by being the preeminent building block supplier to the computing industry.


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Internal analysis: yearOrganizational objectives

  • Define sought after benchmarks

  • Usually specific about time and quantity

  • Often involve sales, profits, numbers of customers, customer satisfaction, etc. or hoped for changes in these

  • Constrains marketing strategy choices


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Internal analysis: yearStrengths and weaknesses

  • Assessment of skills, resources, competencies of the firm

  • What do we do exceptionally well, what not so well?

  • What assets (e.g., patents, image, brands, people) do we have that give us an advantage?

  • How do we compare to competition on these?


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SWOT year

  • Combining the results of internal analysis (SW) with external (OT)

  • Build on strengths to take advantage of environmental changes

  • Manage weakness that are made greater by environmental changes


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Recap: marketing strategy year

  • Outcome of SWOT analysis:

    • a focus on who: which target markets?

    • a focus on how: what marketing mix will move them?

  • Key to success: consistency

    • with the target market and mix

    • among elements of the mix


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Aside: Portfolio models year

  • Purpose: assess each of the firms businesses using internal and external criteria

  • Two examples:

    • Boston Consulting Group Growth/Share Matrix

    • GE Business Screen


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BCG Growth/Share Matrix year

Fast Growth

10%

Slow Growth

High Relative Share

1.0

Low Relative Share


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BCG Growth/Share Matrix year

Fast Growth

C

10%

Slow Growth

A

B

High Relative Share

1.0

Low Relative Share


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GE Business Screen year

High

Industry Attractiveness

Green

Yellow

Medium

Red

Low

Strong

Average

Weak

Business Strength


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Portfolio models: Summary year

  • Assumptions

  • Uses

  • Limitations


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