GLOBAL MARKETING Marketing Strategy

Strategy is integrated action in pursuit of competitive advantage –Offering unique value to customers that cannot be duplicated by competitors.

Benefits of Strategy Coordinates activities among functional areas of organization Defines resource allocation Leads to a superior market position

Components of Strategy Statement of objectives Selection of strategic alternative(s) Selection of customer targets Choice of competitor targets Statement of core strategy Description of supporting marketing mix Description of supporting functional programs Establish general direction of strategy Positioning Implement strategy

Considerations for Global Strategy Political risk Market access Land, labor, and capital costs Shipping considerations Country infrastructure Foreign exchange Product fit

International Market Entry Sourcing –Should the firm export or produce locally? Licensing Investment –Joint ventures –Sole ownership Global strategic partnerships

Market Expansion Strategies Should the firm seek new markets in countries in which it already operates or seek new country markets for already identified and served market segments?

Narrow focusCountry focus Global diversification Country diversification Concentration Diversification ConcentrationDiversification Market Segmentation Country

Stages of Global Development

Generic Marketing Strategies Cost Leadership Differentiation Focused Differentiation Cost Focus Broad target Narrow target Lower costDifferentiation Competitive Scope Competitive Advantage

Broad Market Strategies Cost-leadership advantage –Low-cost producer –Experience curve –Need to obtain largest market share to have lowest cost per unit in industry –Ability to offer lower prices and more value to customers in competitive stages of product life cycle

Differentiation –An actual or perceived uniqueness in product offering –Ability to command premium price

Narrow Target Strategies Focused Differentiation –Offers a narrow target market the perception of product uniqueness at a premium price Cost Focus –Offers a narrow target market lower prices than the competition

Differentiation –adding a set of meaningful and valued differences to distinguish the firm’s offering from competitors’ offerings –Criteria: important preemptive distinctive affordable superior profitable

Differentiation Variables ProductServicesPersonnelChannelImage FormOrdering easeCompetenceCoverageSymbols FeaturesDeliveryCourtesyExpertiseMedia PerformanceInstallationCredibilityPerformanceAtmosphere ConformanceCustomer trainingReliabilityEvents DurabilityCustomer consulting Responsiveness ReliabilityMaintenance & repair Communication RepairabilityMiscellaneous Style Design

Implications of Product Life Cycle on Marketing Strategy

Introduction Stage Objective: Create awareness and product trial Product—offer a basic product Price—charge cost-plus Distribution—selective Communications—target advertising to early adopters and dealers to increase awareness; heavy sales promotion to stimulate trial

Growth Stage Objective: Maximize market share Product—product extensions, warranties Price—decrease prices to penetrate Distribution—intensive Communications—target advertising to mass market to increase awareness; reduce sales promotions

Maturity Stage Objective: Maximize profit while defending market share Product—diversify products and brands Price—match or best competitors’ prices Distribution—more intensive Communications—use advertising to stress brand differences and benefits; increase sales promotions to encourage brand switching

Decline Stage Objective: Reduce expenditure and milk the brand Product—phase out weak models Price—cut price Distribution—selective; phase out unprofitable outlets Communications—reduce and target hard-core loyals; reduce sales promotions to minimal levels