Marketing Analysis, Planning, Decision Making Notespage

8/26/2021
Marketing Strategy, Analysis, Planning,

and Decision Making
Sreedhar Madhavaram
Alumni Professor of Marketing
Porter (1996)
• Operational effectiveness Vs. Strategy

• Operational effectiveness – Performing similar activities better
than rivals perform them. Includes but not limited to
efficiency.
• The essence of strategy is choosing to perform activities
differently than rivals do.
• Therefore, strategy is the creation of a unique and valuable
position, involving a different set of activities.
• At general management’s core is strategy: defining a
company’s position, making trade-offs, and forging fit among
activities.
Porter (1996)
• Strategic positions can be based on customers’ needs,

customers’ accessibility, or the variety of a company’s
products or services.
• Sustainability of strategic position requires trade-offs.
• Trade-offs create the need for choice and purposefully limit
what a company offers.
• Fit drives both competitive advantage and sustainability.
• Three types of fit: first-order (simple consistency), second-
order (reinforcing), and third-order (optimization of effort)
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Marketing Strategy
• Marketing strategy is concerned with decisions relating to

market segmentation and targeting, and the development of a
positioning strategy based on product, price, promotion, and
distribution decisions – Slater and Olson (2006)
• Marketing strategy refers to an organization’s integrated
pattern of decisions that specify its crucial choices concerning
products, markets, marketing activities and marketing
resources in the creation, communication, and/or delivery of
products that offer value to customers in exchanges with the
organizations and thereby enables the organization to achieve
specific objectives
– Varadarajan (2010)
Theories Of Marketing Strategy – Central

Premises
To achieve competitive advantage and, thereby, superior financial performance,
firms should …
• … for market orientation strategy: (1) systematically gather information on

present and potential customers and competitors, and (2) use such information in a
coordinated way to guide strategy recognition, understanding, creation, selection,
implementation, and modification.
• … for market segmentation strategy: (1) identify segments of industry demand,

(2) target specific segments of demand, and (3) develop specific marketing “mixes”
for each targeted market segment.
• … for relationship marketing strategy: identify, develop, and nurture an

efficiency-enhancing, effectiveness-enhancing portfolio of relationships.
• … for brand equity strategy: acquire, develop, nurture, and leverage an

effectiveness-enhancing portfolio of high-equity brands.
In general, most managers’ analyses for

marketing strategy include:
• Analysis of internal environment
• Analysis of external environment
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Analyses
• Managers need concepts, theories, frameworks, analytical
techniques, and market/competitive data for achieving firm
objectives
• Specifically, conceptual frameworks help managers think
about specific concepts and problems and facilitate managerial
action
• Some examples of conceptual frameworks used for
marketing/business analyses are: BCG growth share matrix,
marketing audit, marketing mix, marketing plan, Porter’s five
forces framework, product life cycle, product-marketing audit,
promotional mix, SWOT framework, value chain concept, and
VRIO model
SWOT Framework
• The strengths, weaknesses, opportunities, and threats (SWOT)

framework has its origins in the work of business policy
academics at Harvard Business School
• Strengths and weaknesses are internal to the firm and
opportunities and threats are external to the firm
• For more than four decades, SWOT analysis has remained
popular with business and marketing strategy practitioners as
an analytical tool
Value Chain
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Competitive Forces in an Industry

(Porter’s five forces model, 1980)
Threat of
new entrants
Bargaining Rivalry among Bargaining

power of existing power of
suppliers competitors buyers
Threat of
substitute
products
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Marketing Planning
• Marketing Planning is the structured process of determining

how to provide value to customers, the organization, key
stakeholders by researching and analyzing the current
situation, including markets and customers; developing and
documenting marketing’s objectives, strategies, and programs;
and implementing, evaluating, and controlling marketing
programs to achieve the objectives
• The outcome of this structured process is the marketing plan
- Wood (2008)
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Marketing Plan
• A marketing plan is a written document that summarizes
firm’s market knowledge and how the firm plans to reach its
marketing objectives
• Strategic – involves the specification of target markets and the
value propositions to be offered
• Tactical – involves the marketing programs and the financial
allocations to be implemented over the planning period
• Typical marketing plan includes – Executive summary,
Current marketing situation, Objectives and issues, Target
market(s), Customer analysis, External Environment Analyses,
Positioning, Marketing strategy, Marketing programs,
Financial plans, and Implementation controls
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Marketing Managerial Decision Making
• Define the problem

• Enumerate the decision factors
• Consider relevant information
• Identify the best alternative
• Develop a plan for implementing the chosen alternative
• Evaluate the decision and the decision process
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8/26/2021

Marketing Strategy, Analysis, Planning,

• Operational effectiveness Vs. Strategy

• Strategic positions can be based on customers’ needs,

• Marketing strategy is concerned with decisions relating to

Theories Of Marketing Strategy – Central

• … for market orientation strategy: (1) systematically gather information on

• … for market segmentation strategy: (1) identify segments of industry demand,

• … for relationship marketing strategy: identify, develop, and nurture an

• … for brand equity strategy: acquire, develop, nurture, and leverage an

In general, most managers’ analyses for

• The strengths, weaknesses, opportunities, and threats (SWOT)

Competitive Forces in an Industry

Bargaining Rivalry among Bargaining

• Marketing Planning is the structured process of determining

Marketing Managerial Decision Making

• Define the problem

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