MGT-519 STRATEGIC MARKETING AAMER SIDDIQI 1

LECTURE 9 2

R E - CAP Marketing’s role in the business Cross-functional issues Customer Satisfaction & feed back Customer Relationship Management Strategic Market planning process Environment and situation research PESTLEDI analysis; political, economic, socio-cultural, technological, legal, environmental, demographic technological trends 3

BCG Matrix GE/McKinsey Matrix R E - CAP 4

A NSOFF ’ S M ATRIX A business’ attempts to grow depend on whether it markets new or existing products in new or existing markets The output from the Ansoff product/market matrix is a series of suggested growth strategies that set the direction for the business strategy 5

Market penetration - Growth strategy where the business focuses on selling existing products into existing markets Market penetration seeks to achieve four main objectives: – Maintain or increase the market share of current products – achieved by a combination of competitive pricing strategies, advertising, sales promotion and perhaps more resources dedicated to personal selling – Secure dominance of growth markets – Restructure a mature market by driving out competitors; this would require a much more aggressive promotional campaign, supported by a pricing strategy designed to make the market unattractive for competitors – Increase usage by existing customers – for example by introducing loyalty schemes A NSOFF ’ S M ATRIX 6

A market penetration marketing strategy-“business as usual” The business is focusing on markets and products it knows well It is likely to have good information on competitors and on customer needs It is unlikely, therefore, that this strategy will require much investment in new market research Market development - a growth strategy where the business seeks to sell its existing products into new markets. A NSOFF ’ S M ATRIX (C ONT ’ D ) 7

There are many possible ways of approaching this strategy, including: – New geographical markets; for example exporting the product to a new country – New product dimensions or packaging: for example – New distribution channels – Different pricing policies to attract different customers or create new market segments Product development - a strategy where a business aims to introduce new products into existing markets. A NSOFF ’ S M ATRIX ( CONT ’ D ) 8

This strategy may require the development of new competencies and requires the business to develop modified products which can appeal to existing markets Diversification - is the name given to the growth strategy where a business markets new products in new markets. Inherently more risk strategy because the business is moving into markets in which it has little or no experience. For a business to adopt a diversification strategy, therefore, it must have a clear idea about what it expects to gain from the strategy and an honest assessment of the risks A NSOFF ’ S M ATRIX ( CONT ’ D ) 9

T HE 5 M’ S Aligning a firm’s internal sources to those needed by it in order to successfully implement its strategies for the market/s it is operating in 1.Men 2.Money 3.Materials 4.Machinery 5.Minutes A ‘gap’ analysis Highlighting shortfalls in existing resources 10

Allows management take decisions whether the acquisition and deployment of the extra required resources is desirable given the anticipated benefits and returns to the firm. Within marketing 5Ms is a core model for linking strategy to internal organisation and as such also has a role in RBV and competencies views T HE 5 M’ S (C ONT ’ D ) 11

SWOT-A NALYSIS SWOT analysis provides an overall overview of the – strengths, – weaknesses, – opportunities and – threats of the firm and its environment Strengths are the internal competencies a company needs to have Weaknesses are the competencies that the company does not have; from the customer’s perspective 12

If the customer doesn’t see something as a strength, then no matter how proud of it the business is it is meaningless in a SWOT analysis. Marketing opportunity is an attractive area for a in which the company would enjoy a competitive advantage Environmental threat is a challenge posed by an unfavourable trend or development in the environment that would lead, to the erosion of the company's position SWOT-A NALYSIS ( CONT ’ D ) 13

After performing SWOT analysis, the company uses findings to define the main issues to be addressed in the strategic marketing plan Decisions of these issues lead to setting of – objectives, – strategies and – Tactics SWOT-A NALYSIS ( CONT ’ D ) 14

The figure shows an enhanced SWOT that also illustrates the key questions a SWOT is used to answer These answers then need to be converted into an Action or Project Plan with an overall marketing/business plan context SWOT-A NALYSIS ( CONT ’ D ) 15

S UMMARY Ansoff’s Matrix The 5 M’s SWOT-Analysis 16

T HANKYOU 17