Photo by Andre Benz on Unsplash
One of the earliest pieces I ever read on Marketing was a 2013 Harvard Business Review article: When Marketing Is Strategy.
In the past, businesses have gained competitive advantage by moving ‘upstream’. This is related to making new products e.g. sourcing cheaper raw materials, building bigger factories. Basically, things that improve efficiency.
Recently, there has been a shift.
Today the strategic questions businesses are asking is not “What else can we make?” but “What else can we do for our customers?”.
It is no longer about having the better product but positioning your product at the front and center of customer’s mind.
No longer about driving transactions but maximizing customer lifetime value — long term customer relationships.
That is the focus on this and subsequent issues on Strategic Marketing Management.
Learning Objective
1. Week 1: What is Marketing and Strategic Marketing?
2. Why is Strategic Marketing Management important?
3. Week 2: The Strategic Marketing Management Process
4. TED talk: How to get your ideas to spread
What is Marketing and Strategic Marketing?
When most people think of marketing they think of advertising, but marketing is much more. Marketing is focused on how a company creates and delivers value to its customers.
Strategic marketing or marketing strategy is simply a plan of how to use marketing to achieve a sustainable competitive advantage which would ensure future profitable growth of the business.
Why is Strategic Marketing Important?
I believe strategic marketing is important as it enables a company to understand its target market, and position itself effectively to deliver value continuously to this market.
The Strategic Marketing Management Process
Where are we now?
Any business can assess where there are now by considering the 3 concentric circles — macro environment, micro, and internal environments.
Starting from the outermost circle (Macro environment) going in (Internal environment), you evaluate the different environments. This would provide a solid foundation for your strategic plan.
I would briefly summaries these below, but they would be covered in the next issue on strategy. In strategy, there is a framework for everything.
Macro-environment — refers to any environmental factors that can affect your plans. This can be analyzed using a P.E.S.T.L.E framework (Political, Economic, Social/Cultural, Technological, Legal, and Environmental trends).
Micro-environment — refers to the analysis of your industry. The common framework for this is the Porters five forces.
Internal environment — refers to the analysis of your own organization. What are your resources and capabilities? This can simply be done using a SWOT analysis (Strength, Weakness, Opportunity, and Threat).
Where do we want to be?
What is the goal or objective — Growth, Profit, market share, or customer service.
Clarifying this would enable you determine the target and next step — How might we get there?
How might we get there?
This question is concerned with executing the proposed steps. Two frameworks that are useful for this are SPACE (Strategic Position and Action Evaluation) analysis, and Porters’ Competitive Strategies framework.
Once we have a chosen direction, we need to be sure we have the (Internal) resources and capabilities to execute.
What’s the best way to get there?
Now that we have a clear direction, we can effectively position ourselves (including through marketing). The simplest framework for this which determines your marketing mix is the 4Ps — Product, Price, Place, and Promotion.
Product: Can be goods or services– Quality, Design, Packaging and Brand.
Price: Price refers to how we get paid for offering our product to the market, and all the factors that determine that price like cost. It also includes discounts and payment plans.
Place: This goes beyond the outlet where we sell the product, to the entire process of getting the product to the customer including suppliers and retailers.
Promotion: This refers to how we inform the customer about the product, and where the product is available. The goal is to stimulate demand for the product through marketing such as advertising.
Conclusion
Strategic marketing is important for your business as it enables you consider your strategy, effectively position your product in the market, and gain a competitive advantage.
TED talk
As you watch the talk below, think about:
What is the message you are trying to share with your audience?
How can you make that message spread?
Next week we would learn about — The Customer.
Reference
This summary is adapted from the MSc Strategic Marketing Management course at Durham University Business School.
Issue 4:Strategic Marketing Management - 1& 2
Great blog! I use SWOT and PESTLE very frequently as a Product Manager. Really good frameworks!