Download - Strategic Marketing
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MarketingStrategy
ITESM: Escuela de Graduados en Administración y Dirección de Empresas
June11th, 2009Professor: Fernando [email protected]
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Marketing Strategies Options
• Market Scope: Deals with the coverage of the market. A Business Unit may serve an entire market or concentrate on one or more of its parts.
• Geographic: Deals with territories in order to serve them.
• Market Entry: Refers to the timing of market entry.
• Market Commitment: Refers to the degree of involment a company seeks in a particular market.
• Market dilution: A company may find reducing a part of its business strategically more useful than expanding it
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Market Scope Strategy
• Single-Market Strategy:
– Definition: Concentration efforts in a single segment– Objective: To find a segment currently being ignored or
served inadequately and meet its needs.– Requirements:
• Serve the market wholeheartedly despite initial difficulties or Deals with the coverage of the market.
• Avoid Competition with established firms.
– Expected Results: • Low Cost• Higher Profits
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Market Scope Strategy
• Multi-Market Strategy:
– Definition: Serving several distinct markets.– Objective: To diversify the risk of serving only one
market.– Requirements:
• Good market segmentation• Avoid Confrontation with companies serving the entire market.• Avoid Competition with established firms.
– Expected Results: • Higher Sales• Higher Market Share
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Market Scope Strategy
• Total-Market Strategy:
– Definition: Serving the entire spectrum of market by selling differentiated products to different segments in the market.
– Objective: To compete across the board in the entire market.
– Requirements: • Employ different combinations of price, product, promotion, and
distribution strategies in different segments.• Top management commitment to embrace entire market.• Strong financial position.
– Expected Results: • Increase Growth• Higher Market-Share.
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Market Geography Strategy
• Local-Market Strategy:
– Definition: Concentration of efforts in the immediate vicinity.
– Objective: To maintain the control of the business– Requirements:
• Good reputation in the geographic area• Good hold on the requirements of the market
– Expected Results: • Short term success• Expansion to other geographic areas
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Market Geography Strategy
• Regional-Market Strategy:
– Definition: Operating in two or three states or over a region of the country
– Objective: To diversify risk of dependence on one part of a region / To keep control centralized
– Requirements: • Management commitment to expansion• Adequate resources• Logistical ability to serve a regional area
– Expected Results: • Increased growth• Increased market share• Keep up with competitors
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Market Geography Strategy
• National-Market Strategy:
– Definition: Operating nationally– Objective: To seek Growth– Requirements:
• Top Management commitment• Capital Resources• Willingness to risk
– Expected Results:• Increase Growth• Increase market share• Increase profitability
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Market Geography Strategy
• International-Market Strategy:
– Definition: Operating outside national boundaries.– Objective: To seek opportunities beyond domestic
business.– Requirements:
• Top Management commitment• Capital Resources• Understanding of international markets.
– Expected Results:• Increase Growth• Increase market share• Increase profits
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Market Entry Strategy
• First In Strategy:
– Definition: Entering the market before all others.– Objective: To create a lead over competition that will
be difficult for them to match.– Requirements:
• Be willing and able to take risks.• Be technologically Competent.• Struve to stay ahead / Promote heavily• Create Primary demand• Carefully evaluated strengths
– Expected Results• Reduce Cost via experience• Increase growth• Increase Market Share• Increase Profits
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Market Entry Strategy
• Early Entry Strategy:
– Definition: Entering the market in quick succession after the leader.
– Objective: To prevent the first entrant from creating a stronghold in the market.
– Requirements: • Superior marketing strategy.• Ample resources.• Strong commitment to challenge the market leader
– Expected Results: • Increase profits• Increase Market Share• Increase Growth
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Market Entry Strategy
• Laggard Entry Strategy:
– Definition: Imitator—Entering market with me-too product; (b) Initiator—Entering market with unconventional marketing strategies.
– Objective: Imitator—To capture that part of the market that is not brand loyal. Initiator—To serve the needs of the market better than present firms.
– Requirements: • Market Share Ability /Production Capability• Market Research Ability and ability to generate creative marketing
strategies
– Expected Results: • Increase Short term profits• Putting Market on a new growth path
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Market Commitment Strategy
• Strong Commitment Strategy:
– Definition: Fighting off challenges aggressively by employing different forms of product, price, promotion, and distribution strategies.
– Objective: To defend position at all costs.– Requirements:
• Operate optimally by realizing economies of scale in promotion, distribution, manufacturing, etc
• Refuse to be content with present situation or position• Have ample Resource and be willing to take risk
– Expected Results: • Increase growth• Increase profits• Increase market share
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Market Commitment Strategy
• Average Commitment Strategy:
– Definition: Maintaining stable interest in the market.
– Objective: To maintain the status quo.
– Requirements: Keep customers satisfied and happy.
– Expected Results: Keep customers satisfied and happy.
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Market Commitment Strategy
• Light Commitment Strategy:
– Definition: Having only a passing interest in the market..
– Objective: To operate in the black.
– Requirements: Avoid investing for any long-run benefit.
– Expected Results: Maintenance of status quo (no increase in growth, profits or market share)
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Market Dilution Strategy
• Demarketing Strategy:
– Definition: Discouraging customers in general or a certain class of customers in particular, either temporarily or permanently, from seeking the product.
– Objective: To defend position at all costs.– Requirements:
• Monitor Customer time requirements / Ration product supplies• Divert customers with immediate needs to customers with
immediate needs to customers who have a supply of the product but no immediate need for it.
• Find out and suggest alternative products for meeting Customer needs
• Refuse to be content with present situation or position• Have ample Resource and be willing to take risk
– Expected Results: Increase profits / Strong Customer good will and loyalty
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Market Dilution Strategy
• Pruning of Marginal Markets Strategy:
– Definition: Weeding out markets that do not provide acceptable rates of return.
– Objective: To divert investments in growth markets.– Requirements:
• Gain good knowledge of the chosen markets• Concentrate all energies on these markets• Develop Unique strategies to serve the chosen markets
– Expected Results: • Long term growth• Improve return on investment• Decrease in market share.
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Market Dilution Strategy
• Key Markets Strategy:
– Definition: Focusing efforts on selected markets.– Objective: To serve the selected markets extremely
well.– o divert investments in growth markets.– Requirements:
• Gain good knowledge of the chosen markets• Concentrate all energies on these markets• Develop Unique strategies to serve the chosen markets
– Expected Results: • Increase profits• Increase market share in the selected markets
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Market Dilution Strategy
• Harvesting Strategy:
– Definition: Deliberate effort to let market share slide.– Objective: Generate additional cash flow, to increase
short terms earnings , to avoid antitrust action– Requirements: High market share– Expected Results: Sales decline but useful revenues still
come in.
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MarketingStrategy
ITESM: Escuela de Graduados en Administración y Dirección de Empresas
June11th, 2009Professor: Fernando [email protected]