Marketing strategy

Contents of a marketing plan

Purpose and mission

Plan gives information about the plans purpose- Is it a proposal for a new business or to prepare a
business for the launch of a new product?

The mission statement and other background info about the business help users of the report to
understand where the marketing plan fits in with the existing business.

Situational analysis and market research

Where is the business now?
To develop effective marketing strategies is essential to know:
● the current product portfolio
● market research into the target market (e.g. typical consumer profiles)
● competitor analysis – how many there are and their marketing mix
● the economic and political environment – a PEST analysis • SWOT analysis.

Marketing objectives
Where do we want to be?
Marketing strategies need clear marketing objectives to focus on, these should be SMART so that
progress achieved can be monitored regularly.

Marketing objectives can be expressed in terms of

• sales level (units or monetary value) to be reached by a given date
• market share target
• rate of sales growth
• profit margin targets for the new product.

Marketing strategy
Analyses how the business intends to achieve its marketing objectives. These strategies include
• mass or niche marketing
• selling to the existing markets and consumers
• selling to a new market segment
• developing new markets (e.g. in other countries).

Marketing mix
Marketing plan gives details of the specific marketing tactics that will be used as part of the coordinated
strategy- The 4Ps and details in the marketing plan will include:

• product – the USP and main differentiating factor

• price – whether skimming or penetration pricing
 • promotion – the methods to be used
• place – the main distribution channels to be used

Marketing plan should explain how the 4Ps are linked and coordinated with each other, and how they
should work together to achieve the marketing objectives.

Marketing plan- A detailed and fully researched written report on the marketing objectives and the
marketing strategy to be used to achieve them.

Marketing budget
Financial resources available to the marketing team responsible for the plan must be considered. Little
point in proposing strategies that cannot be afforded. The total sum to be spent should not exceed the
allocated budget for the launch of the new product.

The executive summary and timescale

Final section of the report gives a short overall summary of the plan and the timescale over which it will be
introduced.

Reviewing the marketing plan

How successful was the marketing plan?- crucial to see the
effectiveness
How have the marketing objectives been reached?- if not, by
how much did actual performance fall short of the objectives?
At the end of planning, overall success must be assessed and
this could be used to develop the marketing strategy for the
next time period.

Preparing/ reviewing marketing plans must be done

continuously.- Strategic planning cycle.

Benefits of market planning Limitations of market planning

● Marketing plan is an essential part of the overall ● Marketing plans take up much management time and
business plan of existing businesses or proposed a small business may not have the skilled
new start-ups- plan should demonstrate that a management expertise to produce an effective and
market exists for the product; that it would be professional plan.
profitable to exploit this market; and that the
marketing-mix tactics are appropriate for the ● Any plan can be affected by events and, in a
market. fast-changing market, a complex and inflexible plan
could be a disadvantage. When facing changes, such
● Marketing planning reduces the risk of failure of as the entry of a new competitor, only a flexible
strategies that are very different to those the marketing plan is likely to be successful.
business has followed before- following the stages
of a plan, major potential risks are much reduced ● A plan that is not based on adequate research of the
because clear objectives are set, market research market and customers’ preferences can result in
is undertaken, a coordinated strategy is used and inappropriate marketing strategies being adopted
promotion spending is kept within budget.
● Planning marketing activities give clear direction to
other departments within the business: finance
prepares the cash resources needed, operations
ensure sufficient output is produced and human
resources recruits and trains the workforce needed

Approaches to marketing strategy

Things managers should consider when developing a marketing strategy:

1) Consistency
Must be consistent in quality, quantity and message the marketing activities portray.
New marketing strategy must be consistent with

● The business-Image of the business and its brands identities must reflect marketing strategies. If
the strategy is completely different to customer perception, the message may be
confusing/misleading

● The product- The nature and planned image of the product should clearly be supported by the
promotional methods and messages used in the marketing strategy

● The market- The marketing strategy should reflect the nature of the target market.

2) Coordination
Marketing strategy must be completely coordinated. All marketing activities in the strategy need to be tied
together so that a consistent message is communicated to customers.

Examples of the need for linking parts of the strategy together include
• The marketing mix must be coordinated with the marketing objectives.
• Promotion tactics need to be coordinated with the marketing budget.
• Marketing-mix decisions need to be coordinated together so that the 4Ps are aligned with each other

3) Focused
Importance of measurable marketing
objectives to the overall marketing
plan cannot be overstressed.
Marketing strategies must be focused
on achieving specific marketing
objectives.

Different marketing objectives will

require different strategies.
Each objective will require different
marketing strategies
The changing role of IT and AI in marketing
IT applications in marketing:

Internet:
● Websites are business necessities for marketing.
● Communication and sharing of product details, reviews, and media to attract potential customers.
● Announcements through online services and media stories
● Promotion of products to sell globally

Email:
● Opt-email lists give businesses a large base of customers who already are interested in products.
● Marketing is effective to announce new products, and discounts and sharing info on products.
● Affordable and engaging way to market a product/ generate sales

Mobile:
● Reaches customers on mobile phones/devices through texts and apps
● Texts send special coupons or deals to consumers

In store:
● Digital signage to capture the attention of customers and market specific products to them.
● Businesses use these methods to respond to changes in inventory/ introduce new products.
● POS give employees immediate information on what products are on shelves/tracks customer
preferences.

Social media:
● Quick and easy way to communicate information about a new product
● Attracts customers
● Equivalent to word-of-mouth
● Creates an appealing social media experience to communicate regularly.

Potential AI applications in marketing

AI can achieve:

1) Gaining a more complete understanding of consumers by monitoring what they are buying,
reading, and commenting via social media. This allows marketing managers to quickly modify a
message/special offer to meet consumer preference.

2) Optimise the effectiveness of digital advertising campaigns by analysing consumer word

searches, social profiles and other online data- More effective digital promotions can be directed
at customers

3) Create detailed consumer profiles so the right message can be sent out to each individual ta the
tight time using the right media- personalisation

4) AI’s analysis of huge blocks of data and its ability to identify trends allow brand marketing to
interact with consumers exactly when they are making purchase decisions. Real-time interaction
through online conversation can directly influence the product being bought.
 Limitations of AI in marketing:
● Consumer resistance to data being collected and used may lead to pressure group activity
against businesses dependent on big data
● Management supervision and control still required
● Significant investments in data collection, IT enterprise and computing power required.
● AI computer systems lack human creativity and imagination

Strategies for international marketing

Globalisation and international cooperation: Implications for marketing
Globalisation has accelerated with the growth of multinational companies and the expansion of economic
collaboration.

Collaboration- Aim of creating free-trade agreements. Reduce tariffs or quotas on imports)

Economic collaboration- Countries working together to achieve common aims, such as free
international trade.

Free-trade agreements- Agreements made between countries to reduce or eliminate trade barriers
between them such as import tariffs or quotas.

Globalisation features that impact business strategy:

● increased international trade, as barriers to trade are reduced
● growth of multinational businesses in all countries, as there is greater freedom for capital to be
invested from one country into another
● freer movement of workers between countries

World trade is a sign of increased globalisation by WTO and free trade agreements and the growth of
regional free-trade areas that remove trade barriers between member states.

Globalisation and increased economic collaboration implications for marketing

Positive Negative

● Greater opportunity for selling goods in other countries ● Businesses from other countries have freer acces to the
without tariffs and quotas. National markets may be domestic market- increases competition and wider
saturated and moving internationally gives the chance choice means that if national bsuiensses are
of higher sales, economies of scale and improved uncomepetitive, sales will fall
poriftability
● Increased competition from MNCs will force national
● Global marketing strategy can create a global brand businesses to reduce prices and profits may fall
identity- saves cost of different products for different
markets ● Using same marketing strategy across the world does
not consider the cultural and taste differences between
● Sourcinga nd importing materials and supplies from consumers of different nations- Businesses need to
low-cost countries- no tariffs or quotas should allow a think global but act local.
business to reduce prices and become more
competitive ● Activity from anti-globalisation pressure groups may
result in bad publicity from MNCs in particular. Growing
● More opportunities to arrange mergers, takeovers and concern about the cultural and environmental impact of
joint ventures with businesses in ither countries which globalisation from pressure groups could lead to
could make marketing in other countries easier boycotts and a fall in demand.

International markets
This is a major strategic decision for a business- take time and do adequate research
Stages for the selection process of which foreign country to sell products and how to sell them in a new
market:

International marketing strategies

Globalisation- National and regional differences in tastes, cultures, fashion and wants are less obvious.

Standardisation- is one option for entering these markets and this will sometimes fail.

A business may adopt a global marketing mix to suit local needs and conditions- Localisation (aims to
maintain local differences in the marketing of products)

Approaches to selling goods and services internationally:

1) Pan-global marketing strategies- Marketing a standardised product across the globe, as if the
entire world were a single market, selling the same product in the same way everywhere.

2) Global localisation- Adapting the marketing mix, including differentiated products and adjusting
for national and regional tastes and cultures, in order to maintain local differences.

Pan-global marketing strategies

A strategy that adopts standard products, broad
messages and promotional campaigns across the world.

The geographical area for such common approaches is

limited.

Corporations operate at relatively low costs

Gowing concern over cultural imperialism from the US

and European businesses and an expanding
anti-globalisation movement.
Businesses benefit from adapting and selling products that are geared directly towards the particular
cultural, religious and consumer requirements of each country.

Political and cultural backlash indicates the danger of trying to use a policy of one marketing strategy that
suits all.

Multinationals are understanding the importance of developing different strategies and products to suit
diverse communities globally even if this adds to total costs.

More changes made to a marketing mix to reflect local and regional differences, the closer this comes to
global localisation.

This type of marketing is important to upmarket brands with international appeal for exclusivity and
mass-appeal brands( Apple, Nike, Levi’s)

Global localisation strategies

Thinking global- acting global

Global franchises and branches- security of giant

MNC corporation.
Differentiates most aspects of its marketing mix
between countries and markets.

● Products sold may not be available in other

counties, to suit local consumer states.
● Price levels are varied between different
countries to reflect different average
incomes.
● Advertisements always contain local people.

Choosing a strategy to develop a global market

Choice of strategy is influenced by differences between the existing national market and the target global
markets. (Greater the differences, the greater the need for a localised strategy and not a pan-global
strategy)

Main differences between international markets:

1) Economic and social differences

● Living standards vary across the globe.
● Decisions about international marketing need to take the cost of living, tax rates, interest rates
and the age structure of the population into account.
● Impact the choice of products to sell in foreign markets and the marketing strategies used to sell
them

2) Legal differences
● Differences in laws across the globe
● Some products have different legal statuses in different countries
● Many countries have advertising restrictions
 ● Product safety and product labelling controls are stricter in certain countries

3) Cultural differences
● Difficult to define and measure
● Powerful impact on peoples behaviour
● Failure to recognise cultural differences can impact a firms marketing strategy
● Colours have significance
● use of male and female models together may not be culturally acceptable

4) Differences in business practices

● Accounting standards and rules vary in different parts of the world
● The ease of setting up a limited company varies between countries.

Selecting the method of entry into international markets

Once a business has decided to adopt international marketing, it must choose which method of entry into
(method of selling into) this market it should adopt

Exporting products
Exporting can be undertaken by selling the product directly to a foreign customer- Online e-commerce
sales.

Direct exporting is used for large and expensive items of capital equipment sold to business customers.

Exporting businesses could set up their own marketing division in each target country.

Exporting can also be done indirectly through international trade agents or trading companies-
Intermediaries specialise in managing the sale of products from businesses that may not know the target
country well.
International franchising
Foreign franchisees are used to operate a firm's activities abroad.
one foreign company is used as a franchisee for all the branches in their own country

Joint ventures

Licensing
Allows another business in the foreign country to produce the branded goods or patented products under
licence- involves strictly controlled terms over quality.
Goods do not have to be physically exported, saving on time and transport costs – and making food
products fresher too.

The business selling the licence avoids the capital cost of setting up its own operating bases abroad.

Limitations • possible lapses in quality

• unethical production methods used by the licensee to cut costs, reflecting badly on the main business
• business failure of the licensee, cutting production and sales of the product and reducing income to the
business selling the licence

Direct investment in foreign subsidiaries

Taking over/ merging with local companies in other
countries can result in major problems.

Differences in business culture, organisational

structure and technology between the original
company and the locally acquired business can
create significant obstacles.

An alternative is to set up wholly owned

subsidiaries.

These can achieve more success than takeovers

or mergers.

The subsidiaries can be factories set up in foreign countries or retailing operations- May be almost
completely decentralised, where local managers take most key decisions or organised with centralised
control from the head office in the home country

Why sell products in other countries?

● Saturated home markets
● Higher profits and sales
● Spreads risks
● Legal differences creating opportunities abroad