Importance of marketing strategy
Marketing strategy can be defined as the strategy which integrates business’s marketing activities into a one unified whole. And it makes all the marketing functions or activities go align with the organization strategy. Effective marketing plan will direct the organization to achieve maximum profit through focusing on ideal product mix base on the information gathered by market research.
Every organization is constrained by limited resources so organization must focus on the areas that they could gain maximum benefit for the organization. So having a good marketing strategy will ensure the organization’s marketing activities are aligning with organizational goal achievement and thereby maximize the organization profit potential.
Importance of marketing strategy is increasing day by day due to many reasons such as,
Rapidly changing marketing environment creates new opportunities and threats to the firms so it is important to have good marketing strategy to have benefits from opportunities and take actions proactively to minimize the detrimental effects to the organization from threats.
Top management is focusing on marketing activities to gain competitive advantage over rivals, than ever before.
Realization of importance of synergy, when the organization’s various activities are align together for common goals.
2.0 Process of Developing a Marketing Strategy
Most authors who have expressed their ideas on marketing strategy have explained it as a sequential process which starts with defining the mission and vision and ends with preparing new effective plans to achieve organizational goals. The best approach to develop a marketing strategy is to follow a rational approach. An effective Marketing strategy should have a comprehensive, logical and rational process to develop it.
Marketing strategy is aimed to achieve many objectives, such as facilitate the organization goal achievement, crating market base assets for the organization (knowledge of the market, customer relationship equity), behaviour modelling of customers in a favourable manner for the organization, e.tc.
In preparation of a marketing strategy there are some out lines to follow to make the marketing strategy more effective. First of all a marketing strategy should have a definite purpose. And based on this purpose or purposes other steps of developing a marketing strategy should be followed, so those steps will be glued together for the objective and also it will help to evaluate the marketing strategy’s success and it will ultimately help to develop more effective strategies in future. Another important principle is that it should be flexible so that the strategy can alter based on the internal and external environment Changes. Without adequate flexibility in the marketing strategy will generate many detrimental effects to the organization such as inability to meet competitive pressure. Timeliness is another essential requirement in a marketing strategy. In developing a marketing strategy the organization/management should set specific time schedule to implement the various activities in marketing strategy but it should be flexible also. (If the environment is not behaving as predicted). Although the organization has created an effective strategy it will be use less if it is difficult to understand to the people who are going to implement it. So the strategy should be communicated to the parties who need to know the strategy. The most important aspect should be the marketing strategy should fit in to the all organization activities (internal alignment).
Marketing Strategy process [Refer Figure 1] is illustrated differently by different authors but the following process can be considered as a simple but effective process to follow, for marketing strategy development.
Figure 1: Marketing Strategy Process
Gordon E. Greenley, (1989)
Conduct Research on the target market.
First step under marketing strategy is understanding the organization’s market, organization’s competitors and its customers. Analysis of organization’s strength weaknesses opportunities, threats (SWOT) is also done in this step. Information for developing marketing strategy is provided by the market research so the due consideration should be given to the market research otherwise all the marketing strategies build on inaccurate data will not achieve the expected results for the business. Market strategy can be defined in simple term as the process of learning about the target market to find out information needed to the organization to develop effective marketing strategy. In here target market refers ‘market segment which organization thinks that it can serve more efficiently and effectively”.
Developing a marketing strategy without proper market research is like shooting in the dark. Especially small businesses don’t bother to do market research thinking that conducting a market research is a time consuming and costly task. But the benefits generate from an effective market research is simply outweighs its cost. And there are many cost effective ways to carry out marketing researches in nowadays such as online market research methods.
Online market research can be done in very convenient manner. Followings are some of few tips that can be used to conduct online market research.
Online directories- by searching on the online directories about the product and services that organization wishes to produce the organization can identify the competitors for the organization.
Use of web sites such as Alexa.com which provide detailed information about various business (accuracy of details is not always ensured)
Browse the internet for available data on the market segment which is considered by the organization,
Although online market research is very easy to conduct, information in the internet may not reveal the correct picture of the market so it’s better to test whether those information are correct by conducting a proper market research. By conducting the market research business can gain valuable insight to develop effective marketing strategy which generates the expected results.
Assess the Competition
Organization cannot develop an effective marketing strategy without having a fair idea about the competition that it faces. The business’s competitors are those organizations which produce products or services which are capable of satisfying the target customer’s needs and wants that organization is willing to cater. If the product and services offered by them are more similar to the organization’s product and services then the completion is highly affective to the organization. So in this step organization has to figure out the current competitive position of the firm and where it intended to go.
Get to know the target customer.
Organizations must have an accurate picture about ideal target customer who will generate the best long-term profitability to the firm. After the organization have fair idea about the customers that they are willing to cater, it is essential to know what they are expected from the firm. According to those expectations organization has to alter itself. In brief organization is trying to understand their customers and their needs.
Describe Your Unique Selling Proposition (USP)
After conducting the above two steps the organization have an understanding about who their customers and what are their needs. And in this step organization should focus on to articulate how the organization’s product and services fulfils its target market needs and wants (Unique selling proposition). The organization’s USP should give a description of how the organization product fulfils its customer’s needs and wants.
Define the marketing goals
Without marketing objectives it is impossible to develop marketing strategy. Objectives or goals should be in SMART form (specific, measurable, accurate, relevant, timeliness). The organization must determine whether they are going to increase their market share, increase profitability from the current customers, seeking for new prospects, increase customer life time value or mixture of these, very specifically to develop an effective marketing strategy.
Identify Your Marketing Strategies
After following the above steps organization is ready for writing a marketing strategy. These strategies will guide the decision makers to take tactical marketing decisions. In developing marketing strategy organization should consider varies alternative strategies available to the achievement of the marketing goals and evaluate each by considering their strengths, weaknesses in satisfying target customers needs and wants in a profitable way to the organization and better than the organization's competitors. After the evaluation the organization can pick the best strategy based on the fulfilment of the above requirements and how it fit for the whole organization strategy.
Defining the marketing mix
In defining the marketing mix management has to take decisions on pricing, promotion, product, and place. Optimum blend of these 4 P’s should be based on the marketing strategy. For an example if an organization has decided to serve to one market niche then it should alter its product to target the specific needs of the customers in that market niche, price should be within the budget of that particular niche, distribution or the place of marketing should be an accessible and convenient to that customers, and in promotion organization should communicate how the organization’s products fulfil the needs and wants of that particular group.
Documentation of marketing strategy.
In this stage strategy makers should document the decisions that they took regarding the above mentioned steps. Base on that they should identify key marketing plans/activities that they have to follow over the next period (normally 6-18 months).
Review and Re-assess the Marketing Strategy.
Periodic assessment is a must for continuous development of strategy making. The implemented strategy should be reviewed periodically to asses whether it in the correct path to achievement of the objectives. With the time many environment factors will be change so that initially implemented strategy might not work as expected so by altering the initially implemental strategy with the periodic reviews organization can make sure organizational goal achievement.
Organization can gain higher return on investment in marketing efforts by developing an effective marketing strategy which glue the whole marketing activities together and go align with the overall organizational strategy. There is no clear description of how to develop a marketing strategy but based on the methods presented by various people in the marketing profession an organization can select in a way that they should develop a marketing strategy Or implement a process that is unique to that organization. The above mentioned process is a comprehensive, logical and simple process which can be adapted to almost any kind of organization.
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