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Resources » Articles/Knowledge Sharing » Education »
Marketing Strategy -Tasks of Marketing Managers & A Case Study
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Marketing Strategy
NOTE : In last post I have explained Marketing Strategy and How did strategic marketing develop. Click here to view my post on Strategic Marketing Develop . But i couldn’t explain the exact definition of marketing strategy. To cover that up in this resource I have tried to explain marketing strategy with a case study for better understanding.
A strategy is a statement of clear objectives and the means to achieve them. A marketing strategy should be based on accurate research, so that the objectives are in line with what the market and are achievable.
“To achieve 25% market share” would not be a sensible objective if a small firm was entering a market already dominated by large brand leaders.
“To be regarded as a high quality provider” would be a sensible objective as long as the firm had the skills to deliver quality, and was not managed by cost cutting accountants.
Like other targets in business the marketing objectives should be:
Specific – not just a vague hope
Measurable – capable of clear evaluation
Agreed – so that everyone involved ‘owns’ the target
Realistic – achievable, so that everyone is motivated to succeed
Timetabled – a clear date for achievement of the target
The Marketing strategy starts with being Market focussed. First, a business has to identify what market it is in. This sounds simple, but it is easy to take a product focussed view and create a false strategy that is not really based in the market. The specific target should be based in the reality of the market, rather than the assumptions of the managers.
The market is based on consumer benefits, not on the product.
A holiday travel company is not in the travel market - people don't buy travel and hotel rooms. One travel agent described his business as "dreams". A cosmetics company boss once said that he was not making cosmetics, but "hope"!
Firms such as Kodak and Polaroid have demonstrated the benefits of understanding strategy in terms of consumer benefits. Both firms grew very large by investing in photographic technology. They were not in the Photography market, however, they were in the image market. Consumers were unconcerned about silver halide technology and the huge chemical factories which produced the film. New ways of making pictures came along; Polaroid became a major producer of Videotape, and Kodak invested heavily in digital imaging. If they had seen themselves as being in the photography market, they would both be trying harder and harder to persuade consumers to stick with cameras and film.
A successful Marketing Strategy needs to be based on a knowledge of the benefits that customers are seeking, and on the real competitors.
Tasks of Marketing Managers
Having identified which market we are in, we need to get down to the business of devising a Marketing Strategy to meet the organisation’s goals and satisfy the customers.
Research
Analysis
• Customer characteristics,
• Competitor strengths and weaknesses,
• Our own strengths and weaknesses
• External Environment
All need to be analysed - using both quantitative and qualitative techniques.
Planning includes forecasting and setting objectives. These include the choice of target markets, the strategies to reach those markets and deciding how success will be measured. Marketing objectives should be clear business targets. They can then be budgeted and measured, so that lessons can be learned from success or failure.
Implementation is the co-ordination of functions within the firm to achieve the plans. Staffing, delegating, allocating budgets - putting the firm's resources to work.
Control is managing the progress, particularly evaluating progress against objectives and targets - both customer satisfaction and profit objectives.
Review using the evaluation constructively. A response should ensure that objectives are more closely met next time, and feeds back in a continuous loop to the first stage -
Research, so that it can produce information that is even more useful next time.
Case Study – Daewoo in the United Kingdom
In the spring of 1995, Daewoo launched itself in Britain under the slogan "The biggest Company you've never heard of". It was a bold launch, but it could back up the claim; Daewoo was the 30th biggest industrial company in the world (Coca-Cola was 79th).
Because the British public had never heard of the Daewoo name, the launch campaign was quick to explain that they made ships, aircraft, earth moving equipment and computers.
Objectives
The aim was to be the most successful launch of a new carmaker in Britain, and achieve a 1% market share within a year. This is very ambitious when you consider that Volkswagen had been in the UK market for 50 years and only had 2.9% share, and Toyota had 2.7%.
Strategy
Daewoo knew that they would have to be different. In order to formulate a differentiation strategy they commissioned research into the car market and into customer attitudes to existing brands. The research also asked people about their experiences when buying a new car.
The research had to identify who the target customers would be, and how a completely new company could get its message across to them. What did each group want from a car company? What would make them learn the new name and remember it?
The second problem was to decide exactly where in the market place Daewoo would be positioned. Aiming too high or too low would both be disastrous because first impressions are difficult to change.
The attitudes to dealers were even more clear-cut. The British car -buying public did not like car dealers. Daewoo published a questionnaire in magazines and newspapers. Over 20,000 people who had recently bought a new car clipped the page and returned it.
No-one had ever carried out this kind of research before. The scale and scope of it was surprising to market researchers as well as to the car industry.
The results were very clear. Car dealers were not trusted; either to sell an appropriate car, or to have it serviced properly. Buyers felt unhappy about haggling over the price - they were unsure what price they should have paid even when they negotiated a discount. 65% of all respondents, and 95% of the women, felt "intimidated" by new car showrooms and sales staff.
The research not only revealed how people felt about buying a new car, but who was doing it. Daewoo’s primary research confirmed that the car market is changing. Middle aged males once dominated the market for new cars, either as private buyers or as company car users. The research confirmed that women are buying nearly as many cars as men. It also found that the age range of buyers is extending both downwards and upwards, as wealthier pensioners and young workers increasingly view a new car as a necessity.
The Offer
The Daewoo cars were unexceptional. Not very striking to look at, and not very exciting to drive. A medium sized saloon and a Corolla sized hatchback. Just two models; they were launched into the most fiercely contested product segments in the car market - but also the biggest.
Prices were set lower than the Establishment and the Contenders, and fixed; Daewoo promised no haggling and no discounts. The cars were, however, lavishly equipped with CD players and air conditioning - better than many in the Establishment. The price included many intangibles. Three year's free insurance, three year's warranty and free servicing, three year's AA cover, guaranteed courtesy car delivered to the owner’s house during services. Daewoo drivers would clearly have little to worry about.
The cars are sold through large, bright "Motorshows". Here there are computers to check on colour choices, coffee, and children's toys. The salespeople are not paid commission, and are not allowed to approach customers - they must wait until they are spoken to.
The message – that Daewoo cared for its customers and sold value for money cars – was carried in a massive five million-pound advertising campaign. Most of the promotion was on television and quality newspapers.
It was a different offer. Daewoo went further and offered 200 free cars to the first customers. A later offer gave 1000 buyers a new car six months later. The total offer and the promotions ensured that Daewoo did not remain unknown for long. The intensive advertising campaign emphasised the brand values and established the name with a much higher profile than most of the other “emergents”.
Outcomes
Daewoo took 1.6% of the market in under a year. They outsold all of the "Emergents" and sold almost half as many cars as Honda. More could have been sold if the dealer network had been more widespread. The big "Motorshows" were slow to build, so Daewoo linked up with Halfords (a car accessory superstore chain). There are now sales centres and demonstration vehicles in Halfords branches nation-wide.
It is sometimes hard to believe how successful Daewoo have been. The cars are easy to miss - in fact, they hardly even feature in the advertisements. Daewoo’s strategy has created high profile name, with a low profile product
For more details, visit Tasks of Marketing Managers , Marketing Strategy,
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