STRATEGIC MARKETING

WHERE DO WE PLAY
1
 STRATEGIC MARKETING

Show the McDonalds Segmentation

Video

2
 STRATEGIC MARKETING

Marketing Strategy
• Involves the allocation of resources to develop and sell products or
services that consumers will perceive to provide more value than
competitive goods

• What is perceived value?

 STRATEGIC MARKETING

Foundations of Strategy
• A thorough understanding of:

Domestic and global consumer (market) trends

Models to predict purchase and consumption
Communication methods to reach target markets most
effectively
 STRATEGIC MARKETING

Situation Analysis
Consumer
Company
Competitors
Collaborators
Context

Implementation STP
in Marketplace Segmentation
Targeting
Positioning

Marketing Mix
Product, Price, Place,
Promotion, Brand
 STRATEGIC MARKETING

Situation Analysis
• The process of analyzing:
• Consumer characteristics & trends
• Resources of the Company
• Current and potential Competitors
• Current and potential Collaborators
• The Context or environmental factors
 STRATEGIC MARKETING

Situation Analysis

• Consider the situation we are currently facing.

• What do we know about the company?
• What do we know about its competitors?
• Who does the company collaborate with?
• What do we know about consumers?
• What about context (environmental factors and trends)?
 STRATEGIC MARKETING

Situation Analysis

• Company
• Resources: Finances, Employees, Production,
Development and Design, Research, Facilities,
Marketing/Sales
• What are
• Strengths?
• Weaknesses?
 STRATEGIC MARKETING

SWOT Analysis
Strengths: Weaknesses:

Opportunities: Threats:
 STRATEGIC MARKETING

Situation Analysis
• Competitors
• Who are they?
• What are their advantages/disadvantages?
• How will competitors react?
 STRATEGIC MARKETING

Situation Analysis
• Consumers
• Who are our current and potential customers?
• What do we know about these individuals?
• How do they compare to those who shop for competitor
brands?
 STRATEGIC MARKETING

Situation Analysis
• Collaborators
• Whose strengths best complement ours?
• How will each partner benefit from a strategic alliance?
• Risks & rewards of collaboration?
 Situation Analysis STRATEGIC MARKETING

Consumer
Company
Competitors
Collaborators
Environmental Factors

Implementation STP
in Marketplace Segmentation
Targeting
Positioning

Marketing Mix
Product, Price, Place,
Promotion, Brand
 STRATEGIC MARKETING

Strategy
• Segmentation:
• Process of identifying a group of people
similar in one or more ways, based on a
variety of characteristics and behaviors.
• Goal: minimize variance within groups and
maximize variance between groups
 STRATEGIC MARKETING

Identifying Market Segments

Behavioral

“Heavy versus Light” Users – “80/20 rule”

 STRATEGIC MARKETING

Identifying Market Segments

Consumer
Characteristics

Demographics: Age, Gender, Income, etc…

 STRATEGIC MARKETING

Consumer Characteristics
• Geodemographics
Examine regional differences in demographics
Why?
 STRATEGIC MARKETING

Identifying Market Segments

Psychographics/
Benefits
 STRATEGIC MARKETING

Psychographics
• Lifestyle segmentation
• VALS is based on
primary motivation
and resources
 STRATEGIC MARKETING

Segment Profiles
Once a basis for segmentation has been determined, segments
should be profiled by describing them on as many levels as possible.
 STRATEGIC MARKETING

Customer Profile
• Age, Education, Income (SEC’s)
• Occupation, Hobbies
• Media Habits
• Clusters
• Musical Taste, Preferred Cars
• Aspirational Role Models
 STRATEGIC MARKETING

Strategy
• Targeting
• Select segments of the market to offer products and
services
• Who can we most efficiently and effectively establish a
relationship with better than our competitors?
• What criteria should be used to select a target
market?
Criteria to select a Target Market STRATEGIC MARKETING

Segment size
Segment growth rate
Competitor strength
Customer satisfaction
Fit with company image/objectives/resources
Distribution availability
Investment required
Stability/predictability
Cost to serve
Sustainable advantage
Communication channels available
Risk
Measurability
Accessibility
Substanitality
Congruity 23
 STRATEGIC MARKETING

Strategy
• Positioning
• How your product/company is perceived in the hearts and
minds of your customers?
• Price leader/Innovator/Fashion leader/
Quality/Service
• What associations come to mind?
 STRATEGIC MARKETING

Summary
• A firm needs to:
• Analyze the market
• 5 C’s (Company, Competitors, Collaborators, Customers, and
Context)
• Develop a strategic plan beginning with Segmentation,
Targeting, and Positioning
• Followed by tactical decisions
• Product (Brand), Price, Promotion, and Place
• Implementation issues
 STRATEGIC MARKETING

Market Mapping
Today you will know what Market Mapping and small
budget research is.

You will understand why they are used and how they
are a benefit to businesses and entrepeneurs.

You will then apply this to the Soft Drinks market.

 STRATEGIC MARKETING

Small budget research…

There are ways of conducting small based research that save money. For
example if you wanted to open a Subway Franchise in South Delhi you could:
• Walk around the city, identifying / mapping where the other sandwich bars
are located. (geographical mapping)
• While conducting the geographical mapping you can obtain details on the
competition such as their prices, product range, discounts and deals they
offer
• You could arrange to shadow another franchisee at another Subway in a
near by town/city.
• Use the detail from above to product a market map to identify
opportunities for a new Subway.
 STRATEGIC MARKETING

Market Mapping…
A market Map is a grid that measures two different
aspects of the brands or businesses within a market.
For example in the chocolate market the key features
on a market map could include…

Luxury vs Everyday eating

(i.e. Silk V’s Dairy Milk)

Filling V’s Light

(i.e. Snickers V’s Maltesers)
 STRATEGIC MARKETING

The Purpose of Market Mapping…

1. The idea of market Mapping is to identify gaps in the market,
to show where a sector is overcrowded and to stop the
producer from becoming over-reliant on one sector.
2. Gaps can also provide entrepreneurs with the opportunity to
embark on a new business venture.

Mars is very strong in the filling,

every day sectors with their Twix
and Mars Bars, however people are
now concerned about healthy
eating and the everyday day
chocolate eating sector is in
decline!
 STRATEGIC MARKETING

So what did Mars do???

In the 1990’s Mars launched

the Celebrations !!!
This offers their customers
chocolate on special
occasions and allowed Mars
to enter a new sector.
They identified a gap in the
market and seized this
opportunity!
 STRATEGIC MARKETING

Market Mapping…

For most businesses the difficulty is identify the key

factors to use in the mapping exercise.
These might include…
• High Price / Low Price
• For the Young / For the Old
• Modern / Traditional
• For Men / For Women
 STRATEGIC MARKETING

Market Mapping…

• Companies will decide upon the ‘right’ market

factors after careful market research.
• Talking to customers may show that young and
old have similar views on chocolate where as
men may think differently from women.
• Market mapping is also very useful for a new
small business, for example..
• A new building services may look through the yellow
pages or Google to discover lots of emergency plumbers
,but few who can handle luxury bathrooms.
 STRATEGIC MARKETING

Market Mapping…

• However gaps are sometimes there for a reason!!

• This could be because there is no effective demand
locally.
• Businesses need to understand why there is a gap
BEFORE they decide create a product within it!
• So further market research is needed! And business
must carry this out.
 Task :The Soft Drinks Market STRATEGIC MARKETING

• Using the following Key factors you are to

create a Market Map for the Soft Drinks
Market.
Plot the following brands into
Expensive your map.
Value Lemonades
Coca-Cola
Pepsi
Diet Coke
Traditional Modern / Trendy
Mountain Dew
Maaza
Limca
Real Juice
Cheaper
Red Bull

1. Explain 2 benefits of a soft drinks firm might gain from studying your
market map.
2. What conclusions might Coca-Cola draw from your market map?
3. Discuss how a company might deal with a brand that is suffering from a fall
in sales.