The Strategic MKT Concept 2011

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El Concepto de MarketingEstratgico

5. Semestre

MBA Hctor Lpez Zatarain


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The Strategic Marketing Concept

But First

What is marketing?

Marketing is an organizational function and a set of processes forcreating, communicating, and delivering value to customers and for

managing customer relationships in ways that benefit the organizationand its stakeholders.1

Marketing is about creating long & lasting relations with your customer(a win-win deal) 2

Marketing is the process of inspiring people to buy/use a

product/service 3

Is the science of understanding the consumer preferences and the waythey choose products in order to create a profitable and long lastingrelationship with our brand. 4

1: Phillip Kotler2: Jordana Aguilar

3: Vincent Theunissen4: Diego Herrera & Hctor Lpez Zatarain


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What is Marketing?

ting, and delivering value to customers and for man


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Key Questions

1. How can I identify and choose the right marketsegments?

2. How can I be different from my competition?

3. How can I react to those customers that buy based only

on price?

4. How can I compete with those companies with lowercosts and cheaper prices?

5. How far should we go to customize our offer to each

customer?6. How can we make our business grow?

7. How can we create stronger brands?


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Case Analysis

LEXUS

PLAYSTATION

DISTROLLER

ANDARES

PIPIOLO
http://www.lexus.com/index.html


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Marketing Strategic Role

It is to follow reference marketing evolutionand to identify the different products/marketsand segments (both actual and potential),

based on an analysis of the different needsto find.


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Marketing Management Tasks

Developing marketingstrategies

Capturing marketinginsights

Connecting withcustomers

Building strong brands


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Marketing Management Tasks

Shaping marketofferings

Delivering value

Communicating value

Creating long-termgrowth


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Definion of Strategy

But wait!!!!

What is an strategy?

Series of actions very well though focus in an specificgoal1

a word of military origin, refers to a plan of actiondesigned to achieve a particular goal

1: Diccionarios.com
http://en.wikipedia.org/wiki/Militaryhttp://en.wikipedia.org/wiki/Planhttp://en.wikipedia.org/wiki/Objective_(goal)http://en.wikipedia.org/wiki/Objective_(goal)http://en.wikipedia.org/wiki/Planhttp://en.wikipedia.org/wiki/Military


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Components of a Strategy

1. Reach: Strategic dominium width: product lines, segments wherethe Company competes. Decisions that reflect the Companysmission.

2. Goals and Objectives: Should detail acomplishment limits in one ormore performance dimensions, such as volume growth, margincontribution or ROI.

3. Resource Deployment: Each organization has limited human andfinancial resources. The strategy must consider how thoseresources will be obtained and how should be distributed.

4. Competitive advantage sustainable identification: The strategymust specigy how the organization will compete in each busniess,market or product in its dominium. The Company should make aSWOT analysis facing competition.

5. Sinergy: Exists when a business, product market, resourcedeployment and skills complement and reinforce each other.


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What is a MKT Audit?

Its a thorough, systematicand independentinvestigation about the mktenvironment, the company

objectives, its strategiesand efforts with thepurpose to identifyopportunities, problemsand to recommend plans

of actions to improve thecompanys mkt


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MKT Audit Characteristics

Thorough

Includes all companys departments, not just the ones with problems.

Systematic:

Follows an integral structure. It will define which plans of actions to solve theproblem to improve the companys efficiency.

Independent:

Autoaudit,

Top Management Audit,

Same level Audit,

Deparment Audit,

Workgroup special Audit,

External Audit

Periodic:

When its important, not just when its urgent.


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Audits

MKT Environment Audit

Goals and objectives Audit

Planning and control Audit

Organizational Audit Productivity Audit

MKT Activities Audit

What opportunities and threats of our current

circumstances will affect our present andfuture? (macro trends) How will they affect ourtarget market, competitors and channels?

How logical are the objectives of the company?How valid is our current strategy, given ourforecasts, including the actions of ourcompetitors?

Does the company have successful andaccurate information about customersatisfaction?

Is the structure of the Company adecuate forthe market in which we compete?

How profitable is each of our brands andproducts? How effective are our marketingefforts?

How efficiently do we reach the efforts of ourproduct line? How much do we meet the needsof our target market? Is our sales force bigenough? Is our advertising budget enough?


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Audits

Ethic Audit

Product Manager Audit

The company evaluates the MKTstrategies and efforts against bothinternal codes of ethics of thecompany. It is also the purpose of thisaudit if there is an Internal Code ofEthics, to know if it is communicatedand known by all levels of thecompany.

Mainly for consumer goods. Seeks todetermine if product managers aredevoting their efforts in the bestpossible way. It compares what theyare doing what they shouldbe doing.


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Competitive Environment

Who are our main competitors?

How much is their market share?

How is their brand structure?

How strong are their brands?

Which are the main obstacles to stop othersto enter this market?

What is their competitive advantage?


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Environment Evolution

Economic Environment

Technologic Environment

Socio economic and cultural Environment

Political Environment

International Environment

Ecological Environment


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Company Orientations

Production

Product

Selling

Marketing

Marketing holistic orientation

CRMMarketing 360

Internal Marketing


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Differences between Product Orientedand MKT Oriented Companies

Business Product Orientation MKT Orientation

Product Offering The Company sells what it canproduce; primary focus on performance

and cost.

The Company produce what it can sell;primary focus on customer needs and

market opportunities.

Product Line Thin Wide

Price allocation Based on production

and distribution costs.

Based on perceived benefits.

Research Technical research; focus on productimprovement and production process

reduction.

Market research: focus on newopportunities identification and obtain

new tehcnology for customersatisfaction.

Packaging Minimize costs,maximize production.

Customer comfort; promotional tool.

Credit Minimize losses for bad customers Customer service, tool to attract clients

Promotion Focus on product, quality and pricecharacteristics

Emphasis on product benefits or tosolve customer needs

Wh ill i h


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What we will see in the

futureLess marketing department and more holistic mktLess mkt investment and more marketing focus onprofitable investment.

Less intuitive mkt and more scientific mkt

Less "manual mkt" and more automatized mktLess massive mkt and more accurate mkt


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What are we going to need

High level of competence in:

CRM (Customer Relationship Management)

Effective associated MKT management.

Effective database analisys and MKT information.

Effective contact center and telemarketing management. Public Relations Marketing (including events and

sponsorships).

Branding and brand value management.

Experencial MKT. Integrated Marketing Communications (IMC)

Segments, clients and distribution channels profitanalysis.


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Corporate Planning Activities

Define corporate mission.

Establish SBUs

SBUs resource allocation

Take advantage of growth opportunities.


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The Strategic Planning, Implementation

and Control Process.

Planning

Corporatedivisionbusinessproduct

ImplementationOrganizationimplementation

Control

Measure results diagnose results takecorrective actions


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Correct Mission Statements

Focused in a limited number of objectives.

Determine main politics and values.

Defines major competitive spheres.


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Rubbermaid Commercial Products, Inc.

Our vision is to be the Global Market ShareLeader in each of the markets we serve. We

will earn this leadership position byproviding to our distributor and end-usercustomers innovative, high-quality, cost-

effective and environmentally responsibleproducts. We will add value to these products

by providing legendary customer servicethrough our uncompromising Commitmentto Customer Satisfaction.


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Motorola

The purpose of Motorola is to honorablyserve the needs of the community by

providing

products and services of superior quality at afair price to our customers; to do this so as toearn an adequate profit which is required forthe total enterprise to grow; and by doing so,

provide the opportunity for our employees andshareholders to achieve their personal

objectives.


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eBay

We help people trade anything on earth.We will continue to enhance the onlinetrading experiences of all collectors,

dealers, small businesses, unique itemseekers, bargain hunters, opportunity

sellers, and browsers.


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Major Competitive Spheres

Industry

Products

Competence

MarketsegmentVerticalchannelsGeographic

al


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34

Dimensions that define a

business


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SBUs Characteristics

It is a single business or collection of relatedbusinesses

It has its own set of competitors

It has a leader responsible for:

Strategic planning

ProfitabilityEfficiency


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SBU Planning Process

Business Mission

SWOT Analysis

Objectives Formulation

Strategy Formulation

Program Formulation

Implementation Feedback and control.


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SWOT Analysis

Strenghts

Weaknesses

Oportunities

Threats


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Strategic Declaration

General Cost Leadership: Thebusiness is focused in reducingproduction costs to have lowerprices than its competitors andto obtain an important marketshare. Companies following this

strategy must have importanttechnological resources, buying,production and distributionsystems and less marketing(Texas Instruments).


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Diferenciation: Mainfocus is to obtain asuperior performance in aconsumer area. Thecompany should try to be

a customer service leader,quality leader, style leaderor technology leader, but itwill be unable to be totalleader (Apple)


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Focused: The com The company focuses on one ormore small segments to know them deeply and then triesto obtain cost leadership or differentiation in thesesegments. (Smart)


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Market Opportunity Analysis (MOA)

Can the benefits involved in the opportunitybe articulated convincingly to a definedtarget market?

Can the target market be located andreached with cost-effective media and tradechannels?

Does the company possess or have access

to the critical capabilities and resourcesneeded to deliver the customer benefits?


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Goal Formulation and MBO

Requirements for using MBO

Units objectives must be hierarchical

Objectives should be quantitativeGoals should be realistic

Objectives must be consistent


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McKinseys Seven S Elements

1. Strategy

2. Structure

3. System

4. Style

5. Skills

6. Staff7. Shared Values

7

1

6

4

3

5

2


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BCG Portfolio Analysis

It is built around two criteria: growth rate of therelevant market and relative market share.

?

Relative Market Share

Grow

thRatemarket

Strong Weak

High

Low


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2 basic assumptions:

A high market share means a competitiveadvantage in terms of cost compared to

competition, and vice versa.

Being located in a growth market meanshigh cash flow, and vice versa.


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Milk cows: They are products in a market withweak growth, but the company has a high relativemarket share, these units should provide asignificant cash flow and must be of low resourceconsumption. They are a source of finance tosupport the diversification and / or R & D. Thestrategic objective is to "harvest."

Dogs: These are products with a low relativemarket share in a market that age. Trying to

increase market share would reduce costs andwould not be profitable. The goal is to retiremodestly.


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Question Marks: products with low market share in arapidly growing market that demands significant resourcesto finance growth. Despite its drawbacks for the leader,these products always have the possibility to increase theirmarket share. If they lack adequate financial resources.Dogs will quickly become over its life cycle. Its aim is "todevelop market share," or die.

Stars: Products are market leaders in their environment thatis high growth. Their activities require significant financialfunds to support its growth, but due to their competitiveadvantage, generate significant benefits and in time become

"dairy cows.

?


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?

C

B

E

D

G

F

A


GrowthRatem

arket

Strong Weak

High

L

ow


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?


GrowthRatemarket

Strong Weak

Hig

h

Low

R+D Disaster

Cash flowneeds

+

-

+ -Cash flow generation

Mediocre


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Limited to volume industries

Does not consider external competitiveadvantages, only internal

May be difficult to measure

Recommendations might be, as much,,merely orientations.


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RMG Analysis

The 10 variables:

1. Monopoly and / or industry leadership

2. Customer Service

3. Communication Policy

4. Pricing Policy

5. Inadequate infrastructure

6. Willigness to change

7. Customer insight8. The importance of competition

9. Customer Loyalty

10.Abuse of product market presence.


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Anlisis RMG

Position Objective Actuacin

Ravine Get out Absolute revision

Wall Climb Restructure

Seed Till Adecuate Needs

Valley Strive Continue improving

Peak Mantain Poise


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Anlisis RMG

Choosing Attractive


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Choosing Attractive

Market Segments


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Anlisis General Electric

Atractivodel Mercado

Posicin Competitiva de la Empresa

Dbil Moderado Fuerte

Bajo

Mediano

Alto


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MKT Immutable laws

11. Law of Perspective. The effects of marketing are visible in the long term.12. Law of Line Extension. There is an irresistible pressure to extend the brand value.

13. Law of Sacrifice. Must necessarily give one thing to get another.

14. Law of Attributes. For each attribute there is an opposite, equally effective.

15. Law of Candor. When you admit a negative, the potential client will be granted inexchange for something positive.

16. Law of Singularity. In each situation, only one move will produce substantial results.17. Law of Unpredictability. Unless you write the plans of their competitors, you can not

predict the future.

18. Law of Success. Success usually precedes the arrogance, and arrogance to failure.

19. Law of Failure. The failure must be expected and accepted.

20. Law of Hype. Often, the situation presents a different form as published in the press.

21. Law of Acceleration. Successful plans are not built on news, but trends.22. Law of Resources. Without adequate funding, no idea will get off the ground.

Documents

The Strategic MKT Concept 2011