OHT 20.1 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Strategic marketing

OHT 20.2 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Interaction between marketing and corporate strategy Figure 20.1

OHT 20.3 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Corporate versus marketing strategy Corporate strategy: Allocation of resources within an organisation to achieve the business direction and scope specified within corporate objectives. Helps to control and co-ordinate the different areas of the organisation. Marketing strategy: Defines target markets, direction and requirements in order to create a defensible position compatible with the overall corporate strategy.

OHT 20.4 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Marketing plans and programmes Marketing plan: Turning strategies into implementable actions. A detailed written statement specifying target markets, marketing programmes, responsibilities, time scales and resources to be used within the defined budgets. Marketing programmes: Actions, often tactical, using marketing mix variables to gain advantage within target market. Means of implementing the marketing strategy. Normally detailed in the marketing plan.

OHT 20.5 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Influences on marketing strategy Figure 20.2

OHT 20.6 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Strategic marketing analysis models All of these models view products as: Manageable individual entities on an operational basis. A product portfolio (set of products each of which make a unique contribution to the corporate picture) on a strategic basis.

OHT 20.7 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Analysis models Boston Box. GE matrix. Shell’s directional policy matrix.

OHT 20.8 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition The Boston Box Figure 20.3

OHT 20.9 © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Boston Box Dog - holds a weak market share in a low growth market. Question mark - high market growth with low share. Star - a market leader in a growth market. Cash cow - as market growth starts to trail off, stars can become cash cows. War horses - market leaders, whose cash generating position under threat due to negative market growth. Dodos - low share of a declining market means that sales are dwindling away.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition GE matrix Figure 20.4

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Shell’s directional policy matrix Figure 20.5

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Analytical models - the advantages Useful planning tools. Forces managers to think more strategically. Useful diagnostic tools giving overview of current position. Can stimulate debate on possible consequences of actions.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Analytical models - the constraints Do not give solutions. Simplistic use of variables. Fail to consider synergies between businesses.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Types of growth Market penetration. Market development. Product development. Diversification - concentric, conglomerate. Integration - backward, forward, horizontal. No growth - harvesting, entrenchment, withdrawal.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Competitor analysis A systematic attempt to identify and understand key elements of a competitor’s strategy in terms of objectives, strategies, resource allocation and implementation through the marketing mix.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Porter’s Five Forces Model 1. Bargaining power of suppliers. 2. Bargaining power of customers. 3. Threat of new entrants. 4. Threat of substitute products or services. 5. Rivalry among current competitors.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Strategic groupings Figure 20.8 Source: Adapted from Wilson et al. (1992).

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Examining competitive strengths and weaknesses Provides a valuable insight into their strategic thinking and actions. Requires use of various information sources. Consider in terms of critical success factors. Rate competitors according to their strong and vulnerable points. Information can be used to plan and launch attack.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Useful information about competitors Table 20.2 Source: Wilson et al. (1992).

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Generic strategies Figure 20.9

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Choice of generic strategy Fit between the demands of the strategy and the organisation’s capabilities and resources. The main competitor’s abilities on similar criteria. The key criteria for success in the market and their match with the organisation’s capabilities.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Competitive positions and strategy Figure 20.10

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Attacking and defending Aggressive strategies - frontal, flank, encirclement, bypass, and guerrilla attacks. Defence strategies - fixed position, mobile, flanking, contraction, counter offensive.

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Attack strategies Figure Source: Kotler and Singh (1981). Reproduced with permission of Thomson Media, Eleven Penn Plaza, New York, NY 10001

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Defence strategies Figure Source: Kotler and Singh (1981). Reproduced with permission of Thomson Media Eleven Penn Plaza, New York, NY

OHT © Pearson Education Limited 2003 Brassington and Pettitt: Principles of Marketing, 3rd Edition Co-operative and independent strategies Many situations can also be characterised by peaceful coexistence and co-operative alliances between competitors.