Chapter 2: Strategy
An organizations long-term course of action designed to deliver a unique customer
experience while achieving its goals
Foundation for success
o Organizational foundation (why?)
Core values
Mission (vision)
Organizational culture
o Organizational direction
Business
Goals (objectives)
Long term
Short term
o Organizational strategies
By level
Corperate
SBU
Functional
By offering
Product
Service
Idea
Experience
The foundation the Why?
o why does the company exist
o usually does not change
o guide and inspire employees
o three core elements:
values
mission
culture
Organizational direction the What?
o What business are we in?
Industry, market, direct competitors
o What are our specific goals and objectives?
Something that we will do by a specific time
A performance target, how well are we doing
Organizational strategy the how?
o Convert the why and what into results thats the how
o Varies by
Levels within the organization
What product/service is the organization offering
Settings strategic direction
o Two important questions to ask
Where are we now?
Where do we want to go?
Core competencies
o What do we do best
o What distinguishes us from everyone else
o Exploit competency = success
o Ensure key competitors cannot easily copy you (comparative advantage)
Offer unique, quality product
Question marks
dogs
Products
Current
New
Current
Market penetration
Product development
Selling more products in
Selling new products in existing
existing markets
markets
New
Market Development
Diversification
Selling existing products
Selling a new product in new
in new markets (either
markets
geographic or new
segments)
Strategic marketing process
o Allocate marketing mix resources (4ps) to reach target markets
o Questions
How do we allocate scarce resources
How to we take our plan and turn it into action
Results assessments vs. plan; do we need a new plan?
o The process involves 3 phases
Planning
Implementation
Evaluation
Planning phase
o Three steps
Situation analysis
SWOT analysis
Internal strengths/weaknesses, external opportunities/threats
o Market-product focus, goal setting
Which product,, which customer (market segmentation)
o Marketing program
The how developing the marketing mix & budget
The implementation phase
o Execute the marketing plan (emerges from the planning phase)
Social responsibility
o We are all part of a larger society and accountable
o How should a corporation behave?
They should be socially responsible
Corporate social responsibility
No consensus
Concepts of social responsibility
o Profit
Owners
Shareholders
o Stakeholder
Customers
Employees
Suppliers
o Society
o Enrivonment
o Public
Triple bottom line john Elkington
The new norm
Old bottom line purely about profit/loss is not acceptable
Now it is expected organizations must
o Improve state of the people (social)
o The planet (environment)
o Still maintain profit to stay in business (financial)
Full-cost accounting transparent reporting on all aspects of company actions
including people and the environment
Green marketing
o Emphasis or eco-marketing
o Emphasis on preserving the environment
o Key goals: produce, promote, reclaim
Focus on environmentally sensitive products
What is this?
o Looking at inputs (how they are produced)
o E-waste (electronic product waste)
o Use of low-energy climate systems
o Use of renewable, sustainable materials
o Reduction in product packaging
o Create products that are more fuel efficient and product less waste
o Safe, sustainable, reduce your carbon footprint
Focus is on low environmental impact
Includes: processes, business practices
Good for both profit and environment
Speaks to ethical and social responsibilities
How should consumers behave?
We agree that corporations should act in a socially responsible way, what about
consumers?
Consumer behaviour
The actions a person takes/exhibits in purchasing and using products and services,
including the mental and social processes that precede and follow these actions
Buyer: the consumer who executes the deal
Customer: repeat buyer, customer lifetime value, CLV
Understanding consumer behaviour
o The heart of successful marketing
o Everything begins and ends with the consumer
o This is what you call consumer centricity
o You must begin by understanding why and how consumers behave
Purchase decision process
o Problem recognition
o Information search
o Alternative evaluation
o Purchase decision
o Post purchase behaviour
Psychological influences
o Motivation
o Personality
o Perception
o Learning
o Values
o Beliefs
o Attitudes
o Lifestyle
Sociocultural influences
Types of research
o Exploratory
Preliminary, used to clarify scope/problem to solve
The starting point
Usually this leads to more research
Helps to guide research design/questions to ask
Sometimes it ends here
o Descriptive
Determine basic characteristics of the population
Already a good idea of the problem
Looking for conclusive data to validate program
Idea is to identify the characteristics of the audience
o Casual research
Identifies cause and effect relationships
Exploratory and descriptive precedes casual
Trying to explain a cause and effect relationship
Answer should always be based on scientific methods
Unbiased, objective
Reliable, should get sa3me answer if study is done over and over
Marketing research process
o Problem definition
Define scope and nature of the marketing problem
Exploratory research (preliminary)
o Formal research design
Determine research framework to find the solution
o Data collection and analysis
o Conclusions and report
By segmenting, can be more targeted and specific in marketing approach which makes
for more effective marketing
Buyers are grouped according to variables, ex common need,