Overview
This lecture covers the strategic marketing process, focusing on how organizations develop marketing strategies, create marketing plans, conduct SWOT analyses, and set strategic direction using tools like the 4 Ps and portfolio analysis.
Marketing Strategy Fundamentals
- A marketing strategy defines the target market, value proposition, and marketing mix (4 Ps: product, price, place, promotion).
- Value proposition explains why a customer should buy your product and why it is better than competitors.
- Sustainable competitive advantage is a unique quality not easily copied by competitors that can be maintained over time (e.g., strong brand, innovation).
The Marketing Plan: Structure and Mission
- A marketing plan is a written document detailing market analysis, opportunities/threats, objectives, strategies (4 Ps), financial projections, and metrics.
- The business mission defines the organization’s purpose by answering: What is our business? Who are our customers? How do we add value?
- Mission statements provide organizational scope and guide marketing efforts.
- Goals and objectives are specific, measurable, achievable, and time-bound, set at multiple organizational levels.
Situation Analysis: SWOT and Environment
- SWOT analysis identifies internal strengths/weaknesses and external opportunities/threats.
- Internal factors include human resources, processes, product/market capabilities, and organizational culture.
- External factors include demographics, competition, economic, political/legal, cultural, and technological trends.
Setting Strategic Direction: Portfolio and Market-Product Analysis
- Business portfolio analysis (e.g., Boston Consulting Group Matrix) assesses business units by market growth and share (“stars,” “cash cows,” “question marks,” “dogs”).
- Market-product analysis considers ways to grow: market penetration, product development, market development, diversification.
Macro Strategies for Customer Value
- Sustained advantage can come from customer excellence (loyalty, service), operational excellence (efficiency, supply chain), product excellence (brand, quality), and locational excellence (convenient locations).
- Most companies combine multiple strategies for greater competitive advantage.
Steps in the Marketing Planning Process
- Define the business mission and objectives.
- Conduct a SWOT (situation) analysis.
- Identify and evaluate opportunities using STP (segmentation, targeting, positioning).
- Implement the marketing mix (4 Ps) and allocate resources.
- Evaluate performance using marketing metrics (financial, performance, social responsibility).
Growth Strategies
- Market penetration: Increase sales with existing products in current markets.
- Market development: Sell current products to new markets.
- Product development: Create new products for current markets.
- Diversification: Introduce new products in new markets (related or unrelated diversification).
Key Terms & Definitions
- Marketing Mix (4 Ps) — Product, Price, Place, Promotion: combined tools to market a product.
- SWOT Analysis — Tool to assess Strengths, Weaknesses, Opportunities, and Threats.
- Value Proposition — Statement of the value a product offers to customers.
- Sustainable Competitive Advantage — Unique qualities a firm can maintain to outperform competitors.
- STP — Segmentation, Targeting, Positioning: approach to identify and serve market segments.
- Boston Consulting Group (BCG) Matrix — A framework for analyzing business units based on market share and growth.
Action Items / Next Steps
- Review your favorite companies’ mission statements online.
- Watch the Intel organizational culture video (YouTube).
- Prepare a basic SWOT analysis for a company of your choice.
- Read upcoming material on external environmental factors.