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3.5.1 Foundations of Marketing Strategy: Concepts, Processes, and Key Elements

Overview

Marketing strategy is a structured approach to achieve brand-specific objectives, such as increasing market share or improving ROI. It involves analyzing the environment (5C framework), defining the strategy (4P/7P framework), leveraging analytics, implementing programs, and continuous feedback and control.

Components of Marketing Strategy

1. Marketing Objectives

  • Derived from organizational objectives.
  • Example: Increase market share of Lux from 10% to 15% by the end of the year.

2. 5C Framework (Situation Analysis)

Analyzing five key elements to understand the marketing environment:

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  1. Company: Assess internal capabilities, strengths, and weaknesses.
  2. Customer: Understand customer needs, preferences, and behaviors.
  3. Competitor: Analyze competitors’ strengths, weaknesses, and strategies.
  4. Collaborator: Evaluate partnerships, suppliers, and distributors.
  5. Context: Study the external environment, including economic, social, and technological factors.

3. 4P/7P Framework (Marketing Mix)

Framework to develop the marketing strategy:

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  1. Product: Define the offering, including features, quality, and differentiation.
  2. Price: Determine pricing strategies aligned with customer value and competitor pricing.
  3. Place: Optimize distribution channels to ensure product availability.
  4. Promotion: Plan communication strategies (e.g., advertising, sales promotions).
  5. People (for services): Focus on customer-facing personnel.
  6. Process (for services): Design efficient and customer-friendly processes.
  7. Physical Evidence (for services): Tangible elements that support the service experience.

4. Marketing Analytics

Tools and techniques to strengthen strategy and planning: 1. Value Chain Analysis: Assess activities contributing to product value. 2. Demand Estimation and Forecasting: - Evaluate potential, available, and target markets. - Forecast demand based on resource allocation. 3. Product Life Cycle Analysis: Study product performance across introduction, growth, maturity, and decline stages. 4. Portfolio and Brand Analysis: - Evaluate the performance of products and brands in the portfolio. - Identify opportunities for introducing or removing products. 5. Long Tail Effectiveness: - Definition: Retaining low-frequency, niche products to cater to unique customer demands. - Pros: Increases destination store appeal. - Cons: Requires inventory and storage for slow-moving items. 6. Cost Per Customer Acquisition (CPC): Measure and optimize the cost of acquiring new customers, particularly in digital marketing.

5. Implementation

Steps to execute the strategy effectively: 1. Organizing: Structuring the team and processes. 2. Staffing: Hiring and deploying the right talent. 3. Training and Development: Upskilling employees to align with marketing goals. 4. Retention: Motivating employees through competitive pay, good working conditions, and career growth opportunities.

6. Feedback and Control

Mechanism to monitor and adjust the strategy: 1. Set Benchmarks: Define measurable targets (e.g., monthly market share increases). 2. Measure Performance: Use analytics to track progress against objectives. 3. Adjust Strategy: Based on performance data, refine marketing tactics to stay aligned with goals.

Example: Application of Marketing Strategy

Objective:

Increase Lux’s market share from 10% to 15% in one year.

5C Analysis:

  1. Company: Strong brand equity, well-established distribution network.
  2. Customer: Targeting urban women aged 25–40 with premium positioning.
  3. Competitor: Competing with Dove and Nivea on quality and brand appeal.
  4. Collaborator: Leverage partnerships with retailers and online platforms.
  5. Context: Focus on sustainability and eco-friendly products.

4P Strategy:

  1. Product: Introduce a new eco-friendly Lux variant with premium ingredients.
  2. Price: Maintain competitive pricing relative to Dove.
  3. Place: Strengthen online presence and ensure availability in urban retail stores.
  4. Promotion: Launch a campaign emphasizing Lux’s eco-friendly benefits and target influencer collaborations.
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