5. Design a Competitive Marketing Strategy

1. 5.Design a Competitive Marketing Strategy

2. Design a Competitive Marketing Strategy • A competitive strategy is made up of six parts. • The first four apply to any type of business whereas the other two are used when there is more than one business unit in the health or social care organization. • It involves a determination of:

3. Design a Competitive Marketing Strategy • 1. • The product market in which the business competes. The scope of a business is partially determined by what products it offers, by the markets it serves, by the nature of other businesses with whom it chooses to compete, and by the extent of its vertical integration. The scope of the business is also affected by those same elements it chooses to avoid. Often the latter is more important because decisions regarding what to avoid if acted upon rigorously can conserve resources needed to compete successfully elsewhere. • 2. • The level of investment. Although there are variations and refinements, it is useful to see the options in terms of (a) invest to grow (b) invest only to maintain the existing position (c) milk the business by minimizing investment (d) recover as much of the assets as possible by liquidating or divesting the business

4. Design a Competitive Marketing Strategy • 3. • The functional area strategies required to compete in the selected product market. These are: (a) product line strategy (b) positioning strategy (c) pricing strategy (d) distribution strategy (e) manufacturing strategy (f) information technology strategy (g) segmentation strategy (h) global strategy

5. Design a Competitive Marketing Strategy • 4. • The strategic assets or skills that underpin the strategy and provide the sustainable competitive advantage. A strategic skill is something that the business does extremely well such as manufacturing or marketing and which is strategically important to the business. A strategic asset is a resource such as a brand name or installed customer base that is strong relative to competitors. Strategy formulation should take into account the cost and feasibility of producing or maintaining assets or skills that will provide the basis for a sustainable competitive advantage. A single organization, firm or business, is usually made up of a number of business units. Most business units share an organizational framework with other business units which takes us to the remaining two points.

6. Design a Competitive Marketing Strategy • 5. • The allocation of the resources among the business units. Financial resources generated either internally or externally, plus non-financial resources such as plant, equipment and people, have to be allocated. The allocation decision is a key component in the strategy formulation process.

7. Design a Competitive Marketing Strategy • 6. • Looking for synergies across the business—that is the creation of value by having business units that support and complement each other. Where a firm has many businesses that can achieve synergistic effects it will have an advantage over those firms that ignore such possibilities in their own organizations or who fail or are unable to achieve any synergy.

8. Competitive Marketing Strategy • A competitive strategy is operationalized in terms of • The product market investment decision that encompasses the product market scope of the business strategy, its investment intensity and the resource allocation over multiple businesses. • The functional area strategies—what to do. • The basis of a sustainable competitive advantage to compete in those markets. This core concept encompasses assets, skills and/or synergies matched with functional area strategies