Marketing

1

Dr. Mohammed A. Nasseef

BUS 232

Marketing Strategy

and Planning

Marketing Strategy

Defines the way in which the marketing

mix is used to satisfy the needs of the

target market and achieve

organizational goals

McShane/Von Glinow OB 5e© 2010 The McGraw-Hill Companies, Inc. All rights

reserved2

Product/Market Opportunity Matrix

Market PenetrationIncreasing sales of current products to current market segments without changing the product.

Product DevelopmentOffering modified or new products to current market segments.

Market DevelopmentIdentifying and developing new market segments for current products.

DiversificationStarting up or acquiring businesses outside the company’s current products and markets.

Existing Products New Products

New Markets

Existing Markets

Strategies for company growth

Market PenetrationStarbucks is adding 23 stores per week.

Product DevelopmentStarbucks recently added hot breakfast sandwiches to its menu.

Market DevelopmentStarbucks might consider new demographic markets (for example: senior citizens or different ethnic groups).

DiversificationStarbucks tested new restaurant concepts in San Francisco to enter a new related market.

Existing Products New Products

New Market

s

Existing Markets

Examples of Starbucks’ growth

Product/Market Opportunity Matrix

Tool for assessment

5

To assess the value of product and product

opportunity companies use the SWOT tool

What is SWOT?

It is a planning tool used to identify

Strengths, Weaknesses, Opportunities

and Threats involved in a business. It is

used as part of Strategic Planning

Process to assess the potential value

and fit of new opportunities.

SWOT

Internal factors

• Strengths (S) • Weaknesses (W)

External factors

• Opportunities (O) • Threats (T)

Strengths

Opportunities

Weaknesses

Threats

Internal Environment

Analysis of Internal Environment leads to identification of:

a) Strengths: Positive aspects which are within the control of the organization.

b) Weaknesses: Constraining factors that obstruct the organization ability to achieve its desired goals.

Strengths & Weaknesses

Contributing Factors: People Programmers Properties Processes

External Environment

Analysis of External Environment leads to identification of:

a) Opportunities: Attractive factors that help an institution to develop & improve

b) Threats: Factors beyond the control of an institution that potentially damage the present existence and future development

Opportunities & Threats

Contributing Factors: Technological Economic Legal/Regulatory Social Demographic Political

Dell recognized that its strength was selling directly to consumers and keeping its costs lower than those of other hardware vendors. As for weaknesses, the company acknowledged that it lacked solid dealer relationships. Identifying opportunities was an easier task. Dell looked at the marketplace and saw that customers increasingly valued convenience and one-stop shopping and that they knew what they wanted to purchase. Dell also saw the Internet as a powerful marketing tool. On the threats side, Dell realized that competitors like IBM and Compaq Computer Corp. had stronger brand names, which put Dell in a weaker position with dealers. Dell put together a business strategy that included mass customization and just-in-time manufacturing (letting customers design their own computers and custom-building systems). Dell also stuck with its direct sales plan and offered sales on the Internet.