MGT-519 STRATEGIC MARKETING

AAMER SIDDIQI

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LECTURE 9

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RE-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

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• BCG Matrix• GE/McKinsey Matrix

RE-CAP

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ANSOFF’S MATRIX• 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

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• 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

ANSOFF’S MATRIX

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• 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.

ANSOFF’S MATRIX (CONT’D)

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• 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.

ANSOFF’S MATRIX (CONT’D)

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• 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

ANSOFF’S MATRIX (CONT’D)

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THE 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. Men2. Money3. Materials4. Machinery5. Minutes

• A ‘gap’ analysis • Highlighting shortfalls in existing resources

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• 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

THE 5 M’S (CONT’D)

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SWOT-ANALYSIS• 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

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• 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-ANALYSIS (CONT’D)

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• 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-ANALYSIS (CONT’D)

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• 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-ANALYSIS (CONT’D)

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SUMMARY

• Ansoff’s Matrix

• The 5 M’s

• SWOT-Analysis

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THANKYOU

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