Basic Strategic Market

Marketing Management
Lecture 1 | Ms. Maira Junejo

Marketing Management, A South Asian Perspective, 15th ed, 2016
Marketing and customer Value
• Customer Value
• Value Chain
• Core Competencies & Competitive Advantage
• A Holistic Marketing Orientation and Customer Value
What is Customer Value?
The difference between what a customer gets from a product, and what he or she has to give in order to get it.
Marketing and Customer Value:

The task of any business is to deliver customer value at a profit. A company can win only by fine-tuning the value delivery
process and choosing, providing, and communicating superior value to increasingly well-informed buyers.
What is a Value Chain?
• Developed by Michael Porter
• It says firms are blend of activities. (To
design, produce, market, deliver & support
its product)
• Value chain identifies nine strategically
relevant activities
• Five Primary
• Four Supportive
How to create a successful value chain ?
Success of value chain starts when organization focus on given value
processes and along with developing through
1. Core Competencies
2. Competitive advantage
Core competencies Competitive Advantage
• Specific Skills, Knowledge and • Implies on virtue that
expertise that are difficult to helps the firm to perform
follow by competitors.
better than rivals in the
(Broad investment plan)
market.
Book terms (Narrow investment plan)
(1) It is a source of competitive
advantage and makes a
significant contribution to
perceived customer benefits;
(2) It has applications in a wide
variety of markets;
(3) It is difficult for competitors to
imitate.
Core competence: Groceries at low cost
Wal-Mart has become worlds
largest retailer and the worlds
largest company by delivering on
its promise.
Coca Cola Competitive advantage
• The secret recipe for Coca-Cola, which arguably tastes

better than other cola drinks.
• Their ability to continue developing new products and re-
inventing old ones – Coca-Cola currently offers over 400
brands in 200 markets worldwide.
• The world’s most comprehensive distribution system has
made Coca-Cola accessible to billions of people worldwide
Distribution network is the core competency, one can find the
products of this company in almost all cities and villages, that
is, even in the most backward and hard to reach places.
A Holistic Marketing Orientation and Customer Value
Value
• How company creation • How to use
identify new capabilities &
value • How infrastructure
opportunities efficiently to deliver
create new new value
promising more
efficiently
value
offerings Value
Value
Exploration Delivery
What is strategy?
Strategy is the direction and scope of an organization over the long-term:
which achieves advantage for the organization through its configuration of
resources within a challenging environment, to meet the needs of markets
and to fulfill stakeholder expectation
Direction Scope
Advantage Environment
Stakeholders
The Strategic Planning, Implementation, and control Processes
The Central role of Strategic planning
Corporate division and strategic planning
Corp planning Division Planning Business Product planning

planning
Corp Mission SBU Intensive Growth Resources
Business definition SWOT Integrative Growth Available technology
• Product Definition Portfolio planning models Diversification Investment
• Market Definition • Mc Kinsey Forecast
• BCG Matrix
Steps in strategic planning
Corporate Strategy Mission, Vision, Goals
Business Strategy The business portfolio
Marketing strategies
Brand A Brand A Brand C

Corporate Planning
What is a Mission statement?
• A mission statement is a statement of the purpose of a company,
organization or person, its reason for existing, sense of purpose,
Direction, long term orientation
Charactertics
1. Focus on a limited number of goals
2. Stress company’s major policies and values
3. Define the major competitive spheres within which the company will operate
4. Long-term view
5. Short, memorable and meaningful as possible
Mission Statement IKEA:
To create a better everyday life for the many people.
Mission statement of Ferrari:
To build unique sports cars destined to represent the excellence
of Italian cars, whether on the road or on racing circuits.
What is a Business definition?
Business objectives Marketing objectives
• Build profitable customer • Increase market share

relationships • Create local partnerships
• Invest in research • Increase promotion
• Improve profits
Product and Market oriented business definitions
Division Planning
GE McKinsey Matrix
Business Planning
Business Profiling
Stars: High growth rate and high market share
Question mark: High growth rate and Low market share
Cash Cows: Low growth rate and high market share
Dogs: Low growth rate and low market share
Growth Strategies
1. Intensive growth
Intensive growth is when a firm grows by expanding its product line or its market reach. Thus, if a
firm introduces a new product, enters a new market, or further develops its own competency, than
the firm is undergoing intensive growth.
Product Market expansion grid

Market Penetration: Intense Distribution, Volume Discounts,
Sales incentives
Market Development: finding new geographical,
demographical, institutional segments
Product Development: Addition to current product line, adapt,
modify, magnify product, additional model of current product,
totally new product.
Diversification: new product for new market (Canon, Disney)
Example: Intensive growth
2. Integrative growth
• Backward Integration:
• involves the purchase of suppliers.
• it will result in improved efficiency and cost savings.
• Forward Integration:
• Involve the purchase of distribution or expand control to direct distribution
• Better market products
• Generate high margins
• Horizontal Integration:
• Involve purchase of business at same level of value chain
http://karacheesy.com/polka-ice-cream-was-
a-game-changer-in-pakistan/
Example: integrative growth
3. Diversification
• Diversify when current product or current market orientation seems
to provide no further opportunities for growth.
• Conquering new positions, taking opportunities that promise greater
profitability
Example: Diversification growth
Product Planning
Marketing Plan (check handout)
1.0 Executive summary 3.0 Marketing Strategy 5.0 Financials
2.0 Situation Analysis • Mission • Break even Analysis
• Market Summary • Marketing Objectives • Sales Forecast
• Market Demographics • Financial Objectives • Expense Forecast
• Market Needs • Target Markets
• Market Trends • Positioning
• Market Growth SWOT 4.0 Marketing Tactics
• Product Offering • Product
• Key to Success • Price
• Critical issues • Distribution
• Communication
• Marketing research

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Marketing Management

Lecture 1 | Ms. Maira Junejo

Marketing and Customer Value:

• The secret recipe for Coca-Cola, which arguably tastes

Corp planning Division Planning Business Product planning

Business Strategy The business portfolio

Brand A Brand A Brand C

Business objectives Marketing objectives

• Build profitable customer • Increase market share

Product Market expansion grid

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