1.

Business Strategy vs
2. Brand Strategy vs
3. Marketing Strategy
 Prescribed
Material used for this learning unit:

1. Kotler, P and Armstrong, G. 2014. Principles of Marketing. 15th edition. Upper Saddle
River, NJ: Prentice-Hall. Chapter 2.

2. Chevron, J. 1999. Marketing v. Branding: Why these two business tools should be kept
separate. [Online]. Available at: http://www.jrcanda.com/art_mtgvbrd.html
[Accessed 27 January 2015]. pp.1—4.

3. Osler, R. s.a. Infusing business and brand strategies into account planning. Seattle,
WA: Landor Associates. pp.1—5.
Learning Objectives:
• Show an understanding of what a business, brand and marketing strategy is.

• Critically explain the difference between a business, brand, and marketing

strategy
A brand without a strategy is like a ship
without a rudder
1. Business strategy
Business strategy
The business strategy provides those insights.
The process of developing a business strategy
addresses three fundamental questions:

1 customers’ needs, or what is to be satisfied

2 customer groups, or who is to be satisfied

3 distinctive competencies, or how customer

needs are to be satisfied
STEP 1: Satisfying specific
customer needs
Step one of business strategy forces the firm to
consider what particular consumer need it
intends to satisfy. Discovered through formal
marketing research, competitive analysis, keen
observation, general business activities, or a
conversation overheard, identifying a
specific customer need is where business
strategy begins.
STEP 2:

Precise Customer Segments

Step two of business strategy involves

segmenting the entire population of
potential
customers into discrete customer groups
by psychographic or demographic
profiles.
Step 3: Satisfying needs through
competitive advantage
The third and critical step to business strategy
development is to satisfy the particular needs of the
target audience segments in some way that delivers
perceived value to the market.

It is generally agreed that there are three basic

approaches to convey and deliver value in order to
achieve some degree of competitive advantage:

1 Cost leadership: which relies on operational

efficiencies and scale. a cost leadership strategy,
many leading firms, such as Walmart, Southwest
Airlines, and Saturn, can be looked to for
demonstration of successful cost leadership
strategies.
2 Differentiation: which creates a unique point of
difference for the offering.
3 Focus: which specializes the offering by zeroing in
on a precise market niche
 Strategic Planning
• Strategic planning is defined as:
– “The process of developing and maintaining a
strategic fit between the organization’s goals and
capabilities and its changing marketing
opportunities.”
– Strategic Planning sets the stage for the rest of
planning in the firm. Companies usually prepare
annual plans and strategic plans.
– Includes company mission, setting objectives,
designing a business portfolio and coordination
among functional strategies
 Steps in the
Strategic Planning Process
 Market-Oriented Mission

• The mission statement is the organization’s

purpose, what it wants to accomplish in the
larger environment
• Market-oriented mission statement defines
the business in terms of satisfying basic
customer needs
 Market-Oriented Mission
Marketing Management
A mission statement A mission statement should
asks.. be:
 What is our  An “invisible hand”
business?  Neither too narrow nor too
 Who is the broad
customer?  Fitting of market
 What do consumers environment
value?  Based on distinctive
 What should our competencies
business be?  Motivating
Market-Oriented Mission
Marketing Management
 Setting Company
Marketing Management
Objectives & Goals
• The company needs to turn its mission into detailed supporting objectives for each
level of management.
• Each manager should have objectives and be responsible for reaching them.
• Marketing strategies and programs must be developed to support these marketing
objectives.
• To increase its market share
 Marketing
BusinessManagement
Portfolio

The business portfolio is the collection of

businesses and products that make up the
company
 Companywide Strategic Planning
Analyzing the Current Business Portfolio

Identify key businesses (strategic

business units, or SBUs) that make up
the company

Assess the attractiveness of its various

SBUs

Decide how much support each SBU

deserves
 Strategic Planning

The purpose of Strategic planning is to find a way

in which the company can best use its strengths to
take advantage of attractive opportunities in the
environment.
Assess each SBU:
– The Boston Consulting Group Approach growth-share
matrix classifies SBUs into one of four categories using:
• Market growth rate
• The SBU’s relative market share within the market.
Growth-Share Matrix
 Growth-Share Matrix
Stars – are high growth, high share businesses or products. They need heavy
investments to finance their rapid growth. Eventually their growth will slow down and
they will turn into cash cows.

Cash Cows – are low growth, high share businesses or products. These established and
successful SBU’s need less investment to hold their market share. Produce cash the
company uses to pay bills, support other SBU’s that need investment etc

Question Mark- are low share business units in high growth markets. They require a lot
of cash to hold their share, let alone increase it. Management questions which should
be built into stars and which should be phased out.

Dogs – are low growth, low share businesses and products. They may generate enough
cash to maintain themselves but do not promise to be large sources of cash.
Developing Strategies for Growth and
Downsizing
 Developing Strategies
for Growth and Downsizing

Market penetration is a growth strategy increasing

sales to current market segments without changing
the product – keep original products, could be
achieved by adding new stores, prices, service etc.

Market development is a growth strategy that

identifies and develops new market segments for
current products e.g. Starbucks expansion into China
 Developing Strategies
for Growth and Downsizing

Product development is a growth strategy that

offers new or modified products to existing
market segments e.g. Starbucks introducing a
lighter roast coffee or green coffee extracts
Diversification is a growth strategy for starting up or
acquiring businesses outside the company’s
current products and markets e.g. Starbucks
introducing super premium fresh squeezed juices
Developing Strategies for Growth and Downsizing
 Developing Strategies
for Growth and Downsizing

Downsizing is the reduction of the business

portfolio by eliminating products or
business units that are not profitable or
that no longer fit the company’s overall
strategy
The company’s strategic plan established what kinds of businesses the
company will operate and its objective for each.

Then within each business unit, more detailed planning takes place.

The major functional departments in each unit – marketing, finance,

accounting, purchasing, operations, IT, HR etc they must work together
to accomplish strategic objectives.

Marketing plays a key role in the company’s strategic planning in several

ways:

• Provides a guiding concept

• Provides inputs to strategic planners by helping to identify market
opportunities and assessing the company’s potential to take
advantage of them
• Within BU’s marketing designs strategies for reaching the units
objectives.
2. Marketing Strategy
Marketing Strategy
• To succeed in today’s competitive marketplace, companies must be customer centred

• They must win customers from competitors and then keep and grow them by delivering
greater value.

• But before it can satisfy customers, a company must first understand customer needs and
wants.

• Thus, sound marketing requires careful customer analysis.

• Thus, each company must divide up the total market, choose the best segments, and
design strategies for profitably serving chosen segments.
Marketing Strategy as a process
involves:

• market segmentation

• market targeting

• Differentiation

• positioning
Managing Marketing Strategies and the
Marketing Mix
CORE: Customers are in the
centre. Create value for customers
and build profitable customer
relationships.

MARKETING STRATEGY: which

customers it will serve by
segmentation and targeting,
differentiation and positioning
Guided by MARKETING STRATEGY
the company designs the

MARKETING MIX – Product, Price,

Place and Promotion (the 4P’s)
marketing strategy consists of specific strategies
for target markets, positioning, the marketing mix, and marketing expenditure
levels. It outlines how the company intends to create value for target customers in
order to capture value in return
Market Segmentation
The market consists of many types of customers,
products, and needs. The marketer must determine
which segments offer the best opportunities.

Consumers can be grouped and served in various

ways based on geographic, demographic,
psychographic, and behavioral factors.

The process of dividing a market into distinct groups

of buyers who have different needs, characteristics, or
behaviors, and who might require separate products
or marketing programs is called market
segmentation.

A market segment consists of consumers who

respond in a similar way to a given set of marketing
efforts
Market Targeting
After a company has defined its market
segments, it can enter one or many of these
segments.

Market targeting involves evaluating each

market segment’s attractiveness and
selecting one or more segments to enter.

A company should target segments in which it

can profitably generate the greatest customer
value and sustain it over time.

A company with limited resources might

decide to serve only one or a few special
segments or market niches
Market Differentiation and Positioning
After a company has decided which market segments to enter, it must decide how it will
differentiate its market offering for each targeted segment and what positions it wants to
occupy
in those segments.

A product’s position is the place it occupies relative to competitors’ products in consumers’

minds.

Marketers want to develop unique market positions for their

products. If a product is perceived to be exactly like others on the market, consumers would
have no reason to buy it.

Positioning is arranging for a product to occupy a clear, distinctive, and desirable

place relative to competing products in the minds of target consumers.

Marketers plan positions that distinguish their products from competing brands and give
them the greatest advantage in their target markets.
Positioning: Burger King builds its entire worldwide marketing
campaign around its “Have it your way” positioning.
BMW is “The ultimate driving machine.”

” YouTube let’s you “Broadcast Yourself.”

At McDonald’s you’ll be saying “i’m lovin’ it,”

Burger King you can “Have it your way.”

Such deceptively simple statements form the backbone of a product’s marketing strategy.
Thus, effective positioning
begins with differentiation—actually
differentiating the company’s market offering
so that it gives consumers more value.

Once the company has

chosen a desired position, it must take strong
steps to deliver and communicate that position
to target consumers.

The company’s entire marketing program

should support the chosen positioning strategy.
Developing an Integrated Marketing Mix
After determining its overall marketing strategy, the company is ready to begin planning
the details of the marketing mix, one of the major concepts in modern marketing.

The marketing mix is the set of tactical marketing tools that the firm blends to produce the
response it wants in the target market.

The marketing mix consists of everything the firm can do to influence the demand for its
product.
The Four P’s
of the
Marketing
Mix
Product means the goods-and-services combination the company offers to the target
market.

Thus, a Ford Escape consists of nuts and bolts, spark plugs, pistons, headlights,
and thousands of other parts. Ford offers several Escape models and dozens of optional
features. The car comes fully serviced and with a comprehensive warranty that is as
much a part of the product as the tailpipe.
Price is the amount of money customers must pay to obtain the product.
Ford calculates suggested retail prices that its dealers might charge for each Escape.
Place includes company activities that make the product available to target consumers.
Ford partners with a large body of independently owned dealerships that
sell the company’s many different models.
Promotion means activities that communicate the merits of the product and
persuade target customers to buy it.

Ford and its dealers offer special promotions—sales, cash rebates, and low financing rates
—as added purchase incentives.
4Ps 4Cs

Product Customer solution

Price Customer cost

Place Convenience

Promotion Communication
Managing the Marketing effort
Managing the Marketing Effort
In addition to being good at the marketing in marketing management, companies also need
to pay attention to the management.

Managing the marketing process requires the four marketing

management functions shown in Figure 2.6—analysis, planning, implementation, and
control.

PLANNING - The company first develops company-wide strategic plans and then
translates them into marketing and other plans for each division, product, and brand.

IMPLEMENTATION -Through implementation, the company turns the plans into actions.

CONTROL - Control consists of measuring and evaluating the results of marketing

activities and taking corrective action where needed.

ANALYSIS - marketing analysis provides information and evaluations needed for all the
other marketing activities.
Marketing Analysis
Managing the marketing function begins with a complete analysis of the company’s
situation.

The marketer should conduct a SWOT analysis by which it evaluates the company’s
overall strengths (S), weaknesses (W), opportunities (O), and threats (T)

Strengths include internal capabilities, resources, and positive situational factors that may
help the company serve its customers and achieve its objectives.

Weaknesses include internal limitations and negative situational factors that may interfere
with the company’s performance.

Opportunities are favorable factors or trends in the external environment that the company
may be able to exploit to its advantage.

Threats are unfavorable external factors or trends that may present challenges
to performance.
SWOT Analysis: How to perform one for your organization. n.d. virtualstrategist.
[Online]. Available at: https://www.youtube.com/watch?v=GNXYI10Po6A
[Accessed 31 Oct. 2015].

Personal SWOT Analysis Example - Identifying Your Strengths, Weaknesses,

Opportunities and Threats. n.d. MindToolsVideos. [Online].

Available at: https://www.youtube.com/watch?v=PBOtnyt7BP4

[Accessed 31 Oct. 2015].
Marketing Planning
Through strategic planning, the company
decides what it wants to do with each business
unit.

Marketing planning involves choosing

marketing strategies that will help the company
attain its overall strategic objectives.

A detailed marketing plan is needed for each

business, product, or brand.
 PARTS OF MARKETING PLAN
EXECUTIVE SUMMARY
Presents a brief summary of the main goals
and recommendations of the plan for
management review
Current marketing situations- described the
target market and company’s position in it,
which includes, a market review, product
review, a competition review and distribution.
 PARTS OF MARKETING PLAN
Threats and opportunities analysis –
assesses major threats and opportunities that
the product might face, helping the
management to anticipate important positive
or negative developments that might have an
impact on the firm and its strategies.
 PARTS OF MARKETING PLAN
Objectives and Issues – states the marketing
objectives that the company would like to
attain during the pan’s term and discusses key
issues that will affect their attainment.
Marketing strategy – outlines the broad
marketing logic by which business unit hopes
to create customer value and relationships
 PARTS OF MARKETING PLAN
Action program – spells out how marketing
strategies will be turned into specific actions
that will answer the ff. questions:
What will be done?
When will be done?
Who will do it?
How much will it cost?
 PARTS OF MARKETING PLAN
Budgets – it shows expected revenues (forecasted
number of units sold and the average net price) and
expected cost of production, distribution and
marketing. The difference is the projected profit.
Controls – it includes measures of return on
marketing investment.
 Marketing Control

Measuring and
Return on marketing
Managing Return investment
(or marketing ROI)
on Marketing The net return from a
marketing

Investment investment divided by the

costs of the
marketing investment.
Marketing managers must ensure that their marketing
dollars are being well spent. In the
past, many marketers spent freely on big, expensive
marketing programs, often without
thinking carefully about the financial returns on their
spending.
3. BRAND STRATEGY
https://www.youtube.com/watch?v=EL4EsZv_ltU
https://www.youtube.com/watch?v=Rt7eOs7iG2Y
1. Brand values
The values of a brand are those immutable characteristics that provide consistency for
the brand’s behavior. The brand’s values, to be true values, must permeate the brand
experience.

A company’s values will be a great determiner of what is, and what is not, the right tone and
manner for one of its brand’s communications. As such, it is imperative that the account
planner defends the brand’s values and is effective in transferring those values to all
stewards of the client’s brand within the agency’s walls.
2. Brand Personality
Yet, it is necessary to define the few personality traits that will be imbued in the brand to
help compel interest among target audiences, differentiate it from competitive offerings,
and create a unique brand identity in which equity can be created.
Recently, a study examined 60 well-known brands with distinct personalities. From that
examination emerged five personality factors: sincerity, excitement, competence,
sophistication, and ruggedness (Aaker, 1995).

1. Sincerity: Allstate, Hallmark, and Readers’ Digest.

2. Excitement: Virgin, Cingular, and Adidas.

3. Competence: Ford, Oracle, and Timex.

4. Sophistication: BMW, British Airlines, and Goldman Sachs.

5. Ruggedness: diesel, CAT (Caterpillar), and Timberland.

Sincerity: Allstate, Hallmark, and Readers’ Digest.
Excitement: Virgin, Cingular, and Adidas.
Competence: Ford, Oracle, and Timex.
Sophistication: BMW, British Airlines, and Goldman Sachs.

We provide a wide range of financial

services to a substantial and diversified
client base that includes corporations,
financial institutions, governments and high-
net-worth individuals. Learn more about our
businesses.
Ruggedness: diesel, CAT (Caterpillar), and Timberland.
Any brand management program will benefit from first identifying the personality factor
inherent in the brand and then defining the personality within that general trait.

For example, both Sony and Versace could well be considered sophisticated, but in very
different ways. Sony is sleek, intelligent, and contemporary - if not futuristic - while
Versace is flamboyant, irreverent, and youthful. With a personality profile developed for
the brand, the account planner, along with every other steward of the brand, across
every communications channel, will have a target to aim for in creating an appropriate
tone for the brand’s advertising.
3. Brand positioning
Brand positioning defines the single most
compelling, differentiating, believable, and
deliverable value the brand offers the
targeted audience. It is also the most difficult
element of the brand strategy to develop.

The challenge with positioning is that forces

the selection of one message to promote
first and foremost.
 What is Positioning?
The act of designing the company’s
offering and image to occupy a distinctive
place in the mind of the target market.

Value Proposition
A good hot pizza, delivered to your
door within 30 minutes of ordering,
at a moderate price
 Examples of positioning
Based on size
Based on shape
Based on toughness and endurance
Based on low price
Based on high price
Based on quality
Based on time of day
Based on substitution
Based on sex of the consumer
Based on age
Based on athletic approach
Based on cultural symbols
4. Brand Architecture
Architecture, in the branding context, is the optimal organization of the
brands in a firm’s portfolio.

Specifically, it seeks to create the best view of the company’s brands from the
perspective of the marketplace.

Some brand portfolios employ what is called a master brand strategy, which uses just
one brand to represent all offerings across all categories.
Virgin is a good example of a brand
architecture that uses a master brand
strategy. Virgin is applied to airlines, record
stores, and the list goes on.

Branded House
Another brand architecture strategy is to use subbrands.

This strategy heavily leverages the corporate or lead brand, but augments the lead brand
name with a unique product brand name.

House of Brands
 Marketing v. Branding

MUST READ CHEVRON DOCMENT

MUST READ ARTICLE

Infusing business and brand

strategies into account planning
REVISION
Business Strategy Brand Strategy Marketing Strategy
Is a PLAN OF ACTION by • Is the translation of the • Concerned with how a
setting our objectives and business strategy for the company communicates to
action steps. How to use market place. its consumers.
company resources. Profit • brand strategy is slow and • About getting product to
Driven. multi-faceted market.
• Includes Brand Values, • Marketing communicates
3 Step Process: Brand Personality, Brand quickly and single
1. Identify customer needs – Positioning, Brand identity mindedly while
what is it that needs to be and image. In marketing communication
satisfied?
2. Specify which customer • Brand should be human- it is all about consistent
groups we are interested in? centric and encompass the messages (relevant to USP) to
3. Develop our distinctive 4C’s ie Consumer Solution, achieve a short term goal like
competencies, or how Consumer Cost, Consumer achieving sales, or to inform,
customers are to be satisfied Convenience, Consumer persuade and remind the
Communications. consumer.
Competitive advantage is based • A strong brand creates the
on: business MARKETING STRATEGY:
• Cost Leadership which customers it will serve
• Differentiation
• Focus by segmentation and
targeting, differentiation and
positioning
Guided by MARKETING
STRATEGY the company
designs the

MARKETING MIX – Product,

Price, Place and Promotion
(the 4P’s)
Explain company-wide strategic planning and its four steps.

Strategic planning sets the stage for the rest of the company’s planning. Marketing
contributes to strategic planning, and the overall plan defines marketing’s role in the
company.

Strategic planning involves developing a strategy for long-run survival and growth. It
consists of four steps: (1) defining the company’s mission, (2) setting objectives and goals,
(3) designing a business portfolio, and (4) developing functional plans.

The company’s mission should be market oriented, realistic, specific, motivating,

and consistent with the market environment. The mission is then transformed into detailed
supporting goals and objectives, which in turn guide decisions about the business portfolio.

Then each business and product unit must develop detailed marketing
plans in line with the company-wide plan.
Discuss how to design business portfolios and develop growth strategies.

Guided by the company’s mission statement and objectives, management plans its
business portfolio, or the collection of businesses and products that make up the
company. \

The firm wants to produce a business portfolio that best fits its strengths
and weaknesses to opportunities in the environment. To do this, it must analyze and adjust
its current business portfolio and develop growth and downsizing strategies for adjusting
the future portfolio.
Explain marketing’s role in strategic
planning and how marketing works with its partners
to create and deliver customer value.

Under the strategic plan, the major functional departments—

marketing, finance, accounting, purchasing, operations, information
systems, human resources, and others—must work together to
accomplish strategic objectives.

Marketing plays a key role in the company’s strategic planning by providing a marketing
concept philosophy and inputs regarding attractive market opportunities

Within individual business units, marketing designs strategies for reaching the unit’s
objectives and helps to carry them out profitably.
Describe the elements of a customer driven marketing strategy and mix
and the forces that influence it.

Customer value and relationships are at the centre of marketing

strategy and programs.

Through market segmentation, targeting, differentiation, and positioning, the company

divides the total market into smaller segments, selects segments it can best serve, and
decides how it wants to bring value to target consumers in
the selected segments.

It then designs an integrated marketing mix to produce the response it wants in the
target market. The marketing mix consists of product, price, place, and promotion
decisions (the four Ps).