Business Strategy & the Marketing Program. Business strategies z(Porter’s typology) zOverall cost...
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Transcript of Business Strategy & the Marketing Program. Business strategies z(Porter’s typology) zOverall cost...
Business Strategy & the Marketing Program
Business strategies
(Porter’s typology)Overall cost leadership
broad focus narrow focus
Differentiation broad focus narrow focus
Porter’s Typology
Cost Leadership
Differentiation
Narrow Focus
Broad Focus
Business strategy
Miles & Snow’s typology
ProspectorsDefendersAnalyzersReactors
Miles & Snow Typology
ProspectorsAggressive in new product
development“First mover”High expenditures in new product
R&DOften found in technology-oriented
industries
Miles & Snow Typology
ProspectorsOften found in “new” industriesOften in introduction or early growth
stage of PLC
Miles & Snow Typology
ProspectorsCustomer segments often not well
defined Relatively inefficient in terms of cost-
per-unitOften “cash hungry” Sharing resources with other SBUs
diminishes flexibility
Miles & Snow Typology
DefendersFocus on maintaining position
may entail aggressive marketing efforts Typically found in mature markets
(grocery, soft drinks, etc.)“Cash cows”
Miles & Snow Typology
DefendersTargets “mass market”Repeat/replacement buyersUnderpinned by stable technologyStable, established competitors
Miles & Snow Typology
DefendersCompete through
cost-reduction through process engineering operating synergies with other SBUs
quality improvement R&D price competition promotion
Miles & Snow Typology
DefendersLow-cost defenders (Porter+Miles &
Snow) significant economies of scale and
manufacturing efficiency (process engineering)
low-cost sources of supply
Miles & Snow Typology
DefendersLow-cost defenders (Porter+Miles &
Snow) (cont’d) try to maintain the “low cost” position in
their markets may focus on low price offerings at the
expense of marketing, sales, or service often focus on “commodity-type”
products
Miles & Snow Typology
DefendersDifferentiated defenders
(Porter+Miles & Snow) differentiated offerings cost of differentiation increases cost
structure often found in fragmented markets
Miles & Snow Typology
Analyzers Elements of both prospectors and
defendersFocus on maintaining position in core
marketsSelective pursuit of new product
opportunities
Miles & Snow Typology
Analyzers Low cost analyzers (Porter+Miles &
Snow) maintain “low cost” position when
selectively expanding into new markets Differentiated analyzers (Porter+Miles &
Snow) expand into new markets with
“differentiated” offerings
Miles & Snow Typology
Reactors No well-defined strategyReactive decision-making
Porter & Miles & Snow Combined (BW&L, p. 216)
Prospector Analyzer Defender Reactor
Dif
fere
ntia
tion
Cos
t L
eade
rshi
p
Com
peti
tive
Str
ateg
y(P
orte
r)
Emphasis on new product-market growth(Miles & Snow)
DifferentiatedDefender
Low-costDefender
DifferentiatedAnalyzer
Low-costAnalyzer
Miles and Snow s Miles and Snow TypologyExamples
Defender: McDonald’s
Prospector: Reebok International, Mrs. Fields
Analyzer: Procter & Gamble (Crest), Starbucks
Reactor: W.T. Grant