Definition of Marketting strategy

A strategy that integrates an organization's marketing goals into a cohesive whole. Ideally drawn from market research, it focuses on the ideal product mix to achieve maximum profit potential. The marketing strategy is set out in a marketing plan.

Developing a marketing strategy

Marketing strategies serve as the fundamental underpinning of marketing plans designed to fill market needs and reach marketing objectives.[2] Plans and objectives are generally tested for measurable results. Commonly, marketing strategies are developed as multi-year plans, with a tactical plan detailing specific actions to be accomplished in the current year. Time horizons covered by the marketing plan vary by company, by industry, and by nation, however, time horizons are becoming shorter as the speed of change in the environment increases.[3] Marketing strategies are dynamic and interactive. They are partially planned and partially unplanned. Seestrategy dynamics. Marketing strategy involves careful scanning of the internal and external environments.[4] Internal environmental factors include the marketing mix, plus performance analysis and strategic constraints.[5] External environmental factors include customer analysis, competitor analysis,target market analysis, as well as evaluation of any elements of the technological, economic, cultural or political/legal environment likely to impact success.[3][6] A key component of marketing strategy is often to keep marketing in line with a company's overarching mission statement.[7] Once a thorough environmental scan is complete, a strategic plan can be constructed to identify business alternatives, establish challenging goals, determine the optimal marketing mix to attain these goals, and detail implementation.[3] A final step in developing a marketing strategy is to create a plan to monitor progress and a set of contingencies if problems arise in the implementation of the plan. [edit]Types

of strategies

Marketing strategies may differ depending on the unique situation of the individual business. However there are a number of ways of categorizing some generic strategies. A brief description of the most common categorizing schemes is presented below: * Strategies based on market dominance - In this scheme, firms are classified based on their market share or dominance of an industry. Typically there are four types of market dominance strategies: ** Leader ** Challenger ** Follower ** Nicher * Porter generic strategies - strategy on the dimensions of strategic scope and strategic strength. Strategic scope refers to the market penetration while strategic strength refers to the firms sustainable competitive advantage. The generic strategy framework (porter 1984) comprises two alternatives each with two alternative scopes. These are Differentiation and low-cost leadership each with a dimension of Focus-broad or narrow. ** Product differentiation ** Cost leadership** Market segmentation * Innovation strategies This deals with the firm's rate of the new product development and business model innovation. It asks whether the company is on the cutting edge of technology and business innovation. There are three types: ** Pioneers ** Close followers ** Late followers * Growth strategies In this scheme we ask the question, How should

the firm grow?. There are a number of different ways of answering that question, but the most common gives four answers: ** Horizontal integration ** Vertical integration **Diversification Intensification

A more detailed scheme uses the categoriesMiles, Raymond (2003). Organizational Strategy, Structure, and Process. Stanford: Stanford University Press. ISBN 0804748403.: Prospector Analyzer Defender Reactor

Marketing warfare strategies - This scheme draws parallels between marketing strategies and military strategies.

DFM Foods Ltd - Munching along

DFM Foods Ltd. is engaged in the business of branded packaged snacks. Till about 3 years back, the company was also into the wheat storage business. Subsequently this line of business was discontinued and now (since the last 2 years ) DFM is a pure branded food company. DFM pioneered the entry of packaged snacks in the Indian market with the introduction of its Crax Corn Rings in 1984. Ownership and Management The business is headed by Mr. Mohit Jain, Managing Director and his two sons, Rohan and Rashad Jain. A per exchange filings, the promoter own 69.02% in the company. There are 2 other shareholders under the Public category who have been together owning a little under 12% of the equity for the last few years . Product range: Corn Rings and Wheat Puffs are marketed under the Crax and Natkhat brand names respectively. Both these are extremely popular snacks, especially among children. The fact that the product are baked and not fried also means a significantly lower fat content making it a healthier snack. In the namkeens segment, company offers a complete range of products consisting of 13 distinct product variants that include Bhujiyas, Daals, Mixtures and Nut-Mixes. These are

sold in several pack sizes to cater to both casual / impulse consumption as well as consumption at home. Production & distribution: The Companys corporate office is located at Roshanara in New Delhi. Manufacturing set up is located at Ghaziabad. A new plant has very recently ( 2-3 months back) commenced production at Greater Noida. Post this, production capacity has doubled. The company has established an effective distribution system covering most of North India. Distribution network currently spans the states of Delhi, Uttar Pradesh, Punjab, Haryana, Uttararnchal, Himachal, Jammu & Kashmir, Rajasthan and Madhya Pradesh. Expansion into the Western Region is in progress and partial distribution set up is in place in Mumbai & Pune. To put it mildly,the respone has been encouraging, Last year the company sold everything that it produced at 100% capacity utilization. So;clearly, product acceptance and demand are in place ( in the existing market of North and Central India). Consumer response in Mumbai & Pune since the launch about 6 month back has been very good. The current chink in the armour is the lack of a strong pan India distribution set up. The company is focusing on deeply penetrating its existing markets and also entering new geographies. Financials: Equity: 10 cr Debt: 62.25 cr ( as of sept 30,11) Year ended March 31, 2011 Revenue: 121 cr PBT: 12.71 PAT: 8.32 EPS: Rs. 8.32 Dividend: Rs.2 per share 9-month ended Dec 31, 2012 Revenue: 119 cr ( 38% growth yoy) PBT: 12.9 ( 53% growth yoy) PAT: 8.71 ( 51% growth yoy)

Indian snack food industry: India's snack food industry is estimated to be worth $3 billion and growing at about 2530%. Within this, the organized segment - is believed to be worth $1.5 billion . Key Players: Pepsi Frito lays ( kurkure, cheetos, Lays, uncle chips, lehar ), ITC ( Bingo), Haldiram, Parle products(Full toss, smart chips), Balaji wafers , SM foods ( peppy), Parle Agro ( Hippo),\Prakash snacks ( Yellow Diamond) Sequoia Capital India has invested $30 million ( Rs.145 cr) in Indore-based Prakash Snacks Pvt Ltd for an undisclosed minority stake (speculated to be in the region of 30%) in June 2011. Prakash Snacks had sales of 154 cr in 2010-11. Rajkot-based Balaji Wafers (owned by local entrepreneur Chandubhai Virani and his family) has an estimated turnover of Rs 450 crore. Virani, who started his venture in early 1980s by selling sandwiches in a cinema hall near Rajkot and then diversified to home-made chips, has been keenly sought-after by Frito-Lay. Balaji was willing to dilute only a minority 30% stake to Frito-Lay, but they were keen to acquire 51%-plus share. So, after several round of negotiations lasting for close to two years, the talks broke down a year back . Pepsi Frito Lay had acquired Uncle Chipps for about $ 6.6 million 12 year back from Amrit Agro. Catalysts: Smooth and accelerated roll out of distribution network in geographies where the company is currently partially present or lacks presence. Consolidation in the industry wherein one of the regional players is bought over by Pepsi or ITC or a new MNC entrant. Tie-up ( DFM) with a FMCG major for distribution/equity participation. Ability to maintain sales growth at a CAGR of 30% over the next 3 years. Valuation: The stock is currently traded at Rs.216 at a PE of 18 vis--vis expected EPS of R.12 for the current year. There are no listed pure play branded snack food investment opportunities available in the market currently. So, though on a traditional PE scale, the stock might appear a wee bit expensive, it is but a reflection of the expected growth rate in the branded snack food segment and also to a degree scarcity premium.