Marketing Strategy

2 Year full time PGDM

Session 4

Area – Marketing
Credits - 4
Sessions 10, 11 & 12
‘CAUSE
G
E
I
U
S

WORK

BETTER

WHEN

THEY

S
L
E
E
P
 Here are some Brain Ticklers
• After creating a product prototype, a company tests it
• The result of positioning is the successful within the firm to see how it performs in different
creation of ________, which provides a cogent applications. The company refines the prototype to
reason why the target market should buy the correct the mistakes found in in-house testing. What
product. should be the next step?
• A) an award-winning promotional campaign • A) commercializing the product
• B) performing concept testing
• B) a customer-focused value proposition
• C) conducting beta testing with customers
• C) a demand channel • D) creating a marketing strategy for the product
• D) everyday low pricing • E) performing business analysis
• E) employee value proposition • Answer: C
• Answer: B • Companies that fail to develop new products leave their
existing offerings vulnerable to increased domestic and
• Which of the following best describes a car foreign competition.
company's value proposition? • Answer: TRUE
• A) We charge a 20 percent premium on our cars. • A business analysis is performed mainly to identify if a
• B) We target safety-conscious upscale families. company has got a technically and commercially sound
product.
• C) We sell the safest, most durable car • Answer: FALSE
• D) We are the market leader in the small car • The ________ creativity technique begins with a thought
category. that is written down, then proceeds to develop other
• E) We focus on expanding in faster-growing thoughts that are linked to the first thought, and finally a
new idea materializes by associating all of the thoughts.
markets.
• A) mind mapping
• Answer: C • B) contextual analysis
• A company is more likely to be hurt by current • C) attribute listing
competitors than by emerging competitors or • D) reverse assumption analysis
new technologies. • E) morphological analysis
• Answer: FALSE • Answer: A
 Not enough ??
• When Apple introduced the iPod in October, 2001, it
• ________ refers to the means by which firms
was the first-of-its-kind product that offered sizable
attempt to inform, persuade, and remind storage capacity for songs and a portable device that
consumers — directly or indirectly — about was not seen before in the market. Which of the
the products and brands they sell. following is most likely to have been the marketing
• A) Human resource development communications objective for the iPod at the time of
its introduction?
• B) Marketing communications
• A) developing brand awareness
• C) Financial management • B) building customer traffic
• D) Operations management • C) enhancing purchase actions
• E) Planning • D) establishing product category
• Answer: B • E) enhancing firm image
• The pervasive nature of advanced • Answer: D
communications technologies, such as the • Core competencies tend to refer to areas of special
Internet, has resulted in greater exposure of technical and production expertise, whereas
________ tend to describe excellence in broader
customers to advertising content than it was business processes.
in the 1960s. • A) process benchmarks
• Answer: FALSE • B) distinctive capabilities
• Michael Porter's value chain would identify • C) distributive capabilities
which of the following as a support activity? • D) facultative benchmarks
• A) shipping out final products • E) concentric capabilities
• B) marketing products • Answer: B
• C) procurement • (any examples in India ? )
• Companies including Amazon.com, BMW, Disney,
• D) servicing products
eBay, LEGO, Nike, and Toyota are examples of master
• E) operations marketers.
• Answer: C • Answer: TRUE
 How are we progressing?
Session Topic Sugg. readings * Sugg. readings
Number Chapters ( RB) Chapters ( SJ)

1. Introduction and overview of marketing strategy   2

2. Customer focus and profits 1,2  
3. Environment and the company   6,3
4. Strategic objectives and marketing plans 13 8
5. Portfolio analysis and Strategic Market planning 10 7,10
6. Strategic options 11,12 9
7. Market potential, demand and share 3 13
8. Customer experience and value creation 4 5
9. Market segmentation strategies 5 5
10. Understanding competition   4
11. Competitive position and advantage 6  
12. Product positioning strategies 7 14
13. Pricing strategies 8 15
14. Distribution strategies   16
15. Promotion and Communication strategies 9 17
16. Strategy implementation and challenges 14 11
17. Simulation workshop TBA
18.
19. Simulation workshop TBA
20.
 Session 04
Developing Marketing Strategic Objectives
&
Marketing Plans

Reading Reference
Roger Best – Chapter: 13
S. Jain – Chapter: 8
 Objectives ?
• Organizations must have an objective
that guides to the desired destiny.
• Expression of purpose in clear terms
• Heard about S.O.P. ?
• Organizations often lack clarity of
objectives
• At times, there are confusing and even
conflicting objectives
• For example : Reliance has a clear
objective that they would invest in any
business provided there is an assured
returns of 25% at least.
 Framework and Methodology of defining objectives
• Before we start looking at the framework and Demand Clarity of
methodology, let us have clarity in some Thought
definitions. We often tend to confuse ourselves For clarity of Purpose
with the following words. Then you will know
• Though these words are similar, they are not What you want
certainly the same : … S F Kaufman
Word Meaning

Vision Outlines what the Company wants to be in future – A source of inspiration – Defines where
the organization wants to be

Mission Mission concentrates on the present, defining critical processes and desired level of
performance. Defines HOW the organization will achieve what it envisioned

Policy A written definition of general intent designed to guide and regulate actions and decisions

Objective Long range qualitative purpose

Goal A measurable objective of business achieved within a time frame through planned actions

Strategic Direction An all inclusive term referring to network of Mission, Objective and Goals
 Frustrations when dealing with Objectives
• The following are frequently cited types of
frustrations, disappointments, or troubling
uncertainties that should be avoided when
dealing with objectives:
– Lack of credibility, motivation, or practicality.
– Poor information inputs. 
– Defining objectives without considering
different options.
– Lack of consensus regarding corporate
values.
– Disappointing committee effort to define
objectives.
– Sterility (lack of uniqueness and competitive
advantage)
 GENERAL MOTORS’
STRATEGIC MARKET
PLAN

PROTECT DIVEST
BUICK HUMMER
CADILLAC PONTIAC
CHEVROLET SAAB
GMC SATURN
DAEWOO
OPEL

Invest
VOLT

TIME
Introduction growth maturity Decline
The 7 Step method of Formulating Corporate Direction
• Finding your way to a clear corporate direction can be
Fuzzy, Messy and at times can be very Confusing.
• The process would involve moving from a state of haze
to clarity through many iterations, arguments, points,
counter points, drafts, revision of drafts, brain
storming and finally arriving at a consensus.
• What are the steps involved ?
1. The need for change is recognized
2. Awareness for the need to change to be
communicated to the entire organization
3. Obtaining a broad based support from all concerned
4. Getting commitments from those involved
5. Establishing a clear focus
6. Final commitment is obtained by designating
someone as a captain or champion accountable for
the objectives
7. Efforts are then made to be sensitive to the new
direction
 Relevant Strategies
• Focused strategy—A business may choose to focus on a particular
customer group, customer function, or technology segment. Focus
implies a certain basis for segmentation along one or more of these
dimensions, narrow scope involving only one or a few chosen
segments, and differentiation from competitors through careful
tailoring of the offering to the specific need of the segment(s)
targeted.
• Differentiated strategy—When a business combines broad scope with
differentiation across any or all of the three dimensions, it may be said
to follow a differentiated strategy. Differentiation across segments
may also be related to competitive differentiation. By tailoring the
offering to the specific needs of each segment, a company
automatically increases the chance for competitive superiority.
Whether or not competitive differentiation also results is purely a
function of the extent to which competitors have also tailored their
offerings to the same specific seg-ments. If they have, segment
differentiation may be substantial, yet competitive differentiation may
be small.
• Undifferentiated strategy—When a company combines broad scope
across any or all of the three dimensions with an undifferentiated
approach to customer group, customer function, or technology
segments, it is said to follow an undifferentiated strategy.
 Typical Corporate Direction HP
Profit
 To achieve sufficient profit to finance our
company growth and to provide the
resources we need to achieve our other
corporate objectives
 Customers
 To provide products and services of the
greatest possible value to our customers,
thereby gaining and holding their respect and
loyalty
 Field of Interest
 To enter new fields only when the ideas we
have, together with our technical, manufac-
turing and marketing skills, assure that we
can make a needed and profitable contribu-
tion in the field
 Typical Corporate Direction HP
Growth
 To let our growth be limited only by our profits and
our ability to develop and produce technical
products that satisfy real customer needs
People 
•To help our own people share in the company’s
success, which they make possible: to provide job
security based on their performance, to recognize
their individual achieve-ments, and to help them
gain a sense of satisfaction and accomplishment
from their work
Management 
•To foster initiative and creativity by allowing the
individual great freedom of action in attaining well-
defined objectives
Citizenship
•To honor our obligations to society by being an
economic, intellectual and social asset to each
nation and each community in which we operate
Strategizing through SBU
 The Tata Group (+ 100 companies)
Consumer Defence Financial Manufacturing Promoter
Communica
Services Realty Services
tion and and Retail and Companie
ITES
and
Aerospace s Infrastru
cture
Nelco Infiniti Retail TAL Manufact Tata AIA Life Ins Indian Steel and Wire
Products Tata Indus Associated Build Indian Hotels
Tata ClassEdge Inzpera uring Solution urance ing Company mjunction
Tata Communica Healthsciences s
Jaguar Land Rover
JAMIPOL
tries JUSCO services
tions Landmark Tata AIG General Jamshedpur Continuo Powerlinks Roots Corporatio
Tata Consultancy Insurance us Annealing and Pro n
Tata AG TASEC cessing Company Transmission
Services
Tata Elxsi Tata Global Bever NatSteel Holdings Tata Sons Tata Consulting Taj Air
ages Tata Asset Mana Rallis India Engineers Tata Africa Holdi
Tata Interactive S Tata Coffee Tata Advanced gement Tata Autocomp Tata Housing De ngs
ystems Materials Systems velopment Com Tata Business Exc
Tata Teleservices Tata Sky Tata BlueScope Steel ellence Group
Tata UniStore Tata Capital pany
Tata Teleservices Tata Ceramics Tata Business Sup
Titan Company Tata Chemicals Tata Power
(Maharashtra) Tata Advanced Tata Chemicals Europ Tata Power Delh port Services
Trent Systems Tata Investment e i Distribution Tata Limited
Corporation Tata Chemicals Tata Internationa
Magadi
Tata Power Solar l AG
Tata Technolo Tata Chemicals North Tata Power Tradi Tata NYK
gies America ng
Tata Cummins Tata Projects Tata Services
Tata Daewoo Comme Tata SIA Airlines (
rcial Vehicle Company Tata Realty and I Vistara)
Tata Hitachi nfrastructure
Tata International TRF Tata Strategic Ma
Tata Metaliks nagement Group
Tata Motors
Voltas TKM Global Logis
European Technical C tics
entre TM International
Tata Petrodyne Logistics
Tata Pigments
Tata Sponge Iron
Tata Steel
Tata Steel Europe
Tata Steel Processing
Tata Steel Thailand
Tayo Rolls
The Tinplate Compan
y of India
A typical Strategic Direction with
focus on SBU P & G
 OVERVIEW
 Procter & Gamble(P&G) is a fortune 500 American
Multinational Corporation Headquarter in Downtown
Cincinnati, Ohio USA.
 Manufactures a wide range of consumer goods.
 In 2012, P&G recorded 85.6 billion $ in sales.
 Fortune magazine ranked P&G at fourth place of the
“Worlds most admired companies” list , which was up from
sixth place in 2011.
 According to the Nielsen Company in 2007 P&G spent
more on US advertising then any other company.
TAG LINE
STRATEGIC PLANNING AND MARKETING
PROCESS

 Company’s Vision
 Company’s Mission
 Objectives &
 Goals
 Business portfolio
 SBU’s
 SWOT and TOWS analysis
 THE TOWS MATRIX
• https://youtu.be/t0yvgi3HBqc
• https://youtu.be/H8FANR-2u2Q

Students are expected to be familiar with both

these and should learn to apply in real-time.
VISION STATEMENT
 MISSION STATEMENT

 We will provide products & services of

superior quality & value that improves the
life of the world’s consumers now & for
generations to come.
 As a result consumers will reward us with
leadership sales, profit & value creation,
allowing our people, our stake holders &
the communities in which we live & work
to prosper.
 MARKET ORIENTED MISSION

Company Product Market

Oriented Oriented
Definition
Definition

Procter & Gamble We discover “Be, and be

meaningful insides recognized, as the
into what best consumer
consumers needs products and
and wants. services company
in the world”.
 OBJECTIVES

 To build existing core businesses into stronger

global leaders.
 To grow leading brands in big countries,
winning customers.
 To develop fast growing higher margin with
global leadership potential.
 To regain growth momentum rate & leadership
in Western Europe.
 To drive growth in key developing markets.
 GOALS
 Think globally act locally.
 Build major global brands through strong programs
based on local understanding.
 Improve the environmental quality of its products,
packaging and operations around the world.
 Produce quality products at very competitive
costs.
 Build superior relationships with all the parties who
contribute to fulfilling their corporate purpose,
including their customers, suppliers, universities and
government.
 BUSINESS PORTFOLIO
 ESTABLISHMENT:
P&G is an American Global Corporation based on manufacturing a wide
range of consumer goods, it was founded on October 31, 1837,
headquartered in Cincinnati, Ohio, USA.
As of 2011, P&G is the 4th largest company market capital, 14th largest
by profit and 6th in Fortunes most admired companies list.

 COMPANY TYPE:
Public Type.

 BRANDS:
P&G offers a variety of brands. P&G’s existing products grows through
innovations and renovations while maintaining a balance in geographic
activities and product lines.
The company’s priority is to bring the best and most relevant products
to people, wherever they are, whatever their needs, throughout their
lives.
 SBU’s

A moisturizing It offers an
Fabric bar soap array of skin-
cleaner enriched with
perfumes of
care & beauty
products that
and care French provide multiple
at its inspiration that
leaves your skin
benefits
designed for
best. feeling fresh women of all
soft and sensual ages
 SBU’s (Cont.)

Change your Pampers’ Safeguard is the

look every No. 1 anti-
has products bacterial soap
season to help worldwide. It is
everyday. your little designed to
There’s an provide germ
Herbal one stay
protection for
Essence right clean and the whole
for you. comfortable family
.
 Type of Objectives

Product Market Share Growth

Profitability
Threshold Volume of Market Share dictates Non-growing organizations
Business Volumes leads to extinction or
elimination

Pricing Strategies ( with Gives Competitive Edge Stake holders affected

competition ) positively with growing
Customer acceptability organization
• Customers
• Investors
• Business Partners
• Technological leadership
• Social Contribution
• National and
International
Significance

Product Profitability Command Brand Equity

 Let’s Recap
• The thrust of this Session was on defining objectives and goals
at the SBU level.
• Objectives may be defined as general statements of the long-
term purpose the business wants to pursue.
• Goals are specific targets the corporation would like to achieve
within a given time frame.
• Because SBU objectives should bear a close relationship to
overall corporate direction, the chapter first examined the net-
works of mission, objectives, and goals that make up a
company’s corporate direction.
• SBU objectives and goals were defined in terms of either
financial indicators or desired positions or combinations of
these factors. Also considered were product/market
objectives. Usually set at the SBU level, product/market
objectives were defined in terms of profitability, market share,
growth, and several other aspects.
Class Exercise
 Let’s form teams and role play
Strategic Planning Process

Tasks
Top Management Team ( Core team) Company’s Vision and Mission
Team - A Objectives and Goals in Detail
Team – B Business Portfolio & SBU
Team – C SWOT AND TOWS
Team – D SWOT &
Team – E Financials & Budgeting
Team – F Review and Monitoring

CASE IN STUDY
• Maruti Suzuki holds 49% of Market Share
• It needs a Strategy for the next 5 years
• You are the Key members of its Management
• Each Team shall prepare 3 slides in line with the briefing of Top Management
Team
• Top Management shall compile and review the same
 Marketing Plan
• A marketing plan serves as a Road
map to achieve the Strategic
objectives
• It carefully outlines a business’s:
– Current Situation
– Desired destinations
– The conditions the business will face
on the way to its destination
• Marketing plan identifies the most
optimum use of its resources
 Creativity Vs. Structure
• Developing a Marketing
plan is similar to creating
of a painting
• Creative insights and
analytical structure are
necessary
• The process of developing
a proactive Marketing Plan
takes a delicate balance of
creativity and structure