Approach 1: Entrepreneurial Mode Strategy decisions are made by one powerful individual. T | Summaries Law

Republic of the Philippines

La Patria College

Santiago City

STRATEGIC MANAGEMENT BMEC 103

MODULE 3

FIRST SEMESTER AY 2022-2023

STRATEGIC MANAGEMENT (BMEC 103)

LEARNING OBJECTIVES:

Explain the concept of Marketing and Market

Describe and understand the factors and benefits of Marketing Objectives

Discuss the different Marketing Strategy

INTRODUCTION

In the first chapter, we followed the strategic planning process down to the functional levels of the organization. Each

function, of which marketing is but one, has its own important role to play in the affairs of the organization. However, this

course is about strategic marketing management so we will not be pursuing any other functional activities, such as

personnel or finance, other than in how they interrelate with the marketing activities. Therefore, we start here by looking

at the various aspects of marketing, the marketing concept and the importance of the marketing function. We then

concentrate on marketing objectives – their nature and purpose, the benefits that can be gained from them and potential

problems which can be faced during the formulation stage, and the factors which will influence their formulation. We

conclude by introducing the concept of marketing strategy. Here, there is an important distinction to be made between

marketing strategies as a series of activities and a marketing strategy which describes an approach to business. We

consider the fundamental aspects of the former in this chapter and leave discussion of what constitutes a marketing

strategy to later chapters.

A. MARKETING AND MARKETS

Defining Marketing

Marketing is now recognized as a discipline using a logical approach to understand business and involving the studying,

and understanding, of relationships and exchanges between buyers and sellers. Various definitions of

quot;marketing" have been proposed. Consider the following. "Marketing is the management process

responsible for identifying, anticipating and satisfying customer requirements profitably." (Chartered Institute of

Marketing, UK) "Marketing is a social and managerial process by which individuals and groups obtain what they

need and want through creating and exchanging products and value with others." (Philip Kotler) "The key

element of all marketing is that, unlike almost all other business activities, it is outward-looking; it is firmly centered on

the customer." (Lewis and Erickson) The American Marketing Association updated their definition of marketing in

2004 in an attempt to reflect the changes that have occurred in marketing in the last two decades. They define

marketing as:

“An organizational function and set of processes for creating, communicating, and delivering value to customers and for

managing customer relationships in ways that benefit the organization and its stakeholders”. While many marketers

have their own favorite definition of marketing, the current view of marketing emphasizes a need to deliver value to

customers and manage customer relationships, while delivering value to the organization and its many stakeholders.

The Difference between Strategic and Tactical Marketing It is important to have a clear understanding of the differences

between strategic and tactical marketing.

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La Patria College Santiago City MODULE 3 FIRST SEMESTER AY 2022- STRATEGIC MANAGEMENT (BMEC 103) LEARNING OBJECTIVES:  Explain the concept of Marketing and Market  Describe and understand the factors and benefits of Marketing Objectives  Discuss the different Marketing Strategy INTRODUCTION In the first chapter, we followed the strategic planning process down to the functional levels of the organization. Each function, of which marketing is but one, has its own important role to play in the affairs of the organization. However, this course is about strategic marketing management so we will not be pursuing any other functional activities, such as personnel or finance, other than in how they interrelate with the marketing activities. Therefore, we start here by looking at the various aspects of marketing, the marketing concept and the importance of the marketing function. We then concentrate on marketing objectives – their nature and purpose, the benefits that can be gained from them and potential problems which can be faced during the formulation stage, and the factors which will influence their formulation. We conclude by introducing the concept of marketing strategy. Here, there is an important distinction to be made between marketing strategies as a series of activities and a marketing strategy which describes an approach to business. We consider the fundamental aspects of the former in this chapter and leave discussion of what constitutes a marketing strategy to later chapters. A. MARKETING AND MARKETS Defining Marketing Marketing is now recognized as a discipline using a logical approach to understand business and involving the studying, and understanding, of relationships and exchanges between buyers and sellers. Various definitions of quot;marketing" have been proposed. Consider the following. "Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably." (Chartered Institute of Marketing, UK) "Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others." (Philip Kotler) "The key element of all marketing is that, unlike almost all other business activities, it is outward-looking; it is firmly centered on the customer." (Lewis and Erickson) The American Marketing Association updated their definition of marketing in 2004 in an attempt to reflect the changes that have occurred in marketing in the last two decades. They define marketing as: “An organizational function and set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders”. While many marketers have their own favorite definition of marketing, the current view of marketing emphasizes a need to deliver value to customers and manage customer relationships, while delivering value to the organization and its many stakeholders. The Difference between Strategic and Tactical Marketing It is important to have a clear understanding of the differences between strategic and tactical marketing.

La Patria College Santiago City Strategic marketing This is about decisions and actions that have a major impact on an organization over the long term. It involves setting the strategic direction for the organization with a long-term vision to guide investment in marketing assets and competencies, which can be leveraged within the business process towards providing sustainable competitive advantage. Actual time horizons are broad and may range from six months to a year to three to five years and beyond. Firms involved in strategic marketing are concerned with the development and implementation of marketing strategies that are focused on future time frames. Tactical marketing This is the approach that moves marketing from the strategic to the operational level and involves designing and implementing plans for the short term. This largely involves the implementation of the various individual campaigns and programmes that are required to meet the marketing objectives. The Concept of a Market In marketing terms, a customers needs, wants or requirements tend to mean a product (or service). The product may be tangible or intangible – it is still something that the customer wants in order to deal with a real or imagined requirement that they have or, to put it another way, a customer has a problem to solve. People can satisfy their requirements, or problems, in one of four ways:  self-solution (coming up with the answer to the problem themselves)  force (threatening/stealing)  begging (pleading/seeking sympathy)  exchange (offering something of value to the owner). The last method, exchange, is based on a mutually beneficial outcome to both parties. This value exchange summarizes marketing and applies in every type of product exchange, from the simple purchase of a bar of soap by a housewife, to the purchase of attack aircraft by a government. In every case both parties give, or exchange, something of value to the other. For this to be possible, two parties must: have something of value to exchange be capable of communicating be free to accept or reject the exchange situation. The size of the market will be determined by the number of people who both want a product and are prepared, and able, to exchange the required value in order to obtain it. A market can thus be said to exist wherever there is a potential to effect a value exchange. Markets can be described in various ways:  by reference to the general type of goods or services exchanged – for example, health or leisure  by reference to the types of consumer who want the products – for example, teenagers  by reference to the geographical context within which the exchange takes place – for example, European. The Marketing Mix Companies who follow the marketing concept will use the marketing mix to conduct their dealings with customers. The “mix”; as it is affectionately known, is really a combination of factors which can be amended or adapted to suit the requirements of individual, or groups of, customers. It is the “tool-box” of the marketer. The term “marketing mix” covers the seven controllable variables of:

La Patria College Santiago City McKay (1972) – who suggested that there were only three possible marketing objectives: (i) to enlarge the market (ii) to increase market share (iii) to improve profitability. Gultinan and Paul (1988) – who argued that six objectives should be considered: (i) market share growth (ii) market share maintenance (iii) cash flow maximization (iv) sustaining profitability (v) harvesting (vi) establishing an initial market position. Influencing Factors on Marketing Objectives The influences on marketing objectives can be related to: (a) The external environment:  a rapidly changing environment  government legislation  competitive activity or actions  changes taking place in technology  different patterns of population or buying behaviour  recessionary economics, etc. (b) The internal environment:  unrealistic corporate objectives  poor planning skills  narrow viewpoint of the planners  lack of resources  fear of failure to achieve limiting creativity  leadership & Internal culture  lack of knowledge of the market environment, etc. Benefits of Marketing Objectives Providing marketing objectives are defined clearly and communicated correctly, they can bring many advantages.  They give a clear direction to the personnel involved  They can create unity  They allow for measurement of achievement  They can reduce risk  They can improve decision making Problems in Formulating Marketing Objectives

La Patria College Santiago City Despite the fact that so many advantages can be gained, it is a sad fact that many organisations find it almost impossible to define good marketing objectives. There can be several reasons for this.  Fear of failure  Apathy  Success  Organizational culture  Lack of knowledge Any change in strategy – the marketing mix, customer mix or product mix – is likely to change the profit margin. This impact must be taken into account when determining marketing objectives. The planning process is like a giant jigsaw. The whole picture is determined at corporate level and then each area of the business is responsible for its own part. If all departments achieve their objectives, this should build up to ensure that the organisation achieves its overall objectives. Planning takes place throughout the organisation. The process is the same, only the emphasis changes as you move from corporate to marketing plans. The following tables summarize these different emphases. C. MARKETING STRATEGY Marketing, and other functional-level, objectives spring directly, and naturally, from the corporate level strategies which, in turn, are aimed at meeting the corporate objectives. Naturally enough, therefore, we would anticipate marketing strategy to be aimed at meeting the marketing objectives. However, we need to make a distinction between the concepts of “marketing strategy” a “marketing strategy” “Marketing strategy”; describes the means of achieving an objective; or A “marketing strategy” describes an approach, stance or long-term plans. (It is from this use of the word that we get ;strategic planning;, meaning a higher level of planning.) Over the years marketing authors have tried to clarify this issue in different ways. Wilson, Gilligan and Pearson in Strategic Marketing Management, readily admit that there is no standard definition of “strategy”, but highlight three “levels” of strategy: Corporate strategy – dealing with the allocation of resources throughout the entire organisation, covering all of the various businesses or divisions. Business strategy – which exists at the individual business or division level and is concerned with the question of competitive positioning. Functional-level strategy – which is limited to the actions of specific functions within specific businesses.

Approach 1: Entrepreneurial Mode Strategy decisions are made by one powerful individual. T, Summaries of Law

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