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Marketing Strategy is the absolute and unconquerable plan designed specifically for attaining the marketing objectives of the firm. The marketing objectives indicate what the firm wants to achieve, the marketing strategy provides the design for achieving them. It is the marketing strategy that decides the success at the business unit level, which in turn decides the total corporation's success. The linkage between marketing Strategy and overall corporation success is indeed direct and vital and in this linkage lays the significance of a marketing strategy.
Economic factors are of concern to marketing firms because they are likely to influence, among other things, demand, costs, prices and profits. These economic factors are largely outside the control of the individual firm, but their effects on individual enterprises can be insightful.
A much quoted example in this context is the 'debt crisis' caused by the Middle East in 2009 which produced economic shock waves throughout the Western world, resulting in dramatically decreased stock prices. This contributed significantly to a world economic recession, and it all serves to demonstrate how dramatic economic change can upset the traditional structures and balances in the world business environment.
As the recession mostly affected the airlines company, because of that British Airways had agreement to a $7bn by merging with its Spanish rival Iberia. This is mainly due to the variation in oil price at the time crisis which make the company put inertia on the cost for ticket, which make the business and consumers harder to build their business ,causing the passenger rates has been decreased.
British Airways become third largest airline company in the world by revenue, this is due to merging with another airline company Iberia and it is expected to produce a â‚¬400m per annum by 2015.
Analysis and discussion
As can be seen, changes in world economic, forces are potentially highly significant to marketing firms, particularly those engaged in international marketing. However, an understanding of economic changes and forces in the domestic economy is also of vital importance as such forces have the most immediate impact.
One such factor is a high level of unemployment, which decreases the effective demand for many luxury consumer goods, adversely affecting the demand for the industrial machinery required to produce such goods. Other domestic economic variables are the rate of inflation and the level of domestic interest rates, which affect the potential return from new investments and can inhibit the adoption and diffusion of new technologies. In addition to these more indirect factors, competitive firms can also pose a threat to the marketing company so their activities should be closely monitored.
It is therefore vital that marketing firms continually monitor the economic environment at both domestic and world levels. Economic changes pose a set of opportunities and threats, and by understanding and carefully monitoring the economic environment, firms should be in a position to guard against potential threats and to capitalize on opportunities.
The cost and revenue to be managed frequently for achieving global competitive advantage and at the same time efficiency and innovation play an important role in the competitive advantage strategies. In every business or organisation innovation is treated in different parts or functions of an organisation choose the best decisions in order to avoid centralizing or decentralizing assets. Some of the resources and its capabilities are specially centralised for the home country operation and also for to analyse the economies scale, these also help in research and development activities and to protect certain core competencies.
Because of little potential economies of scale compared to the benefits of differentiation, to create flexibility in business and for avoiding the dependence on a single facility, some resources may be decentralized on local concepts.
The result is a complex configuration of assets and capabilities that are distributed; yet specialized.
As the competition is increasing globally requires the simultaneous optimization of scale, scope and factor cost economies, and to have flexibility to cope with out any changes in technologies, exchange rates and taste.
Another important competitive advantage is Time. Competitive advantage mainly concerns with time because it is constantly changing target. They did not stick with using the simple idea of its source of advantage. Each competitor knows how to react to the changing situation in the business and always lie on the cutting edge. So in this key situation time plays an important factor in competitive market especially in the area of production, development and marketing, which represents the most powerful sources in the competitive advantage. As an evidence of this, time is strategic weapon in business, it is equivalent of money, productivity, quality and innovative.
The home based business play and vital role in competition advantages of the companies are created and persistent. According to home based business, the country is develop a attractive platform in the industry and it provides good marketing environment yielding in home country creates an advantage in competing globally among other particular industries in that field from that Porter had identified two determinants for a good global platform in an organisation.
There are many simple factors affecting the competitive market today such as low cost unskilled labour, depending on old technology and natural resources but these factors less important as compared to complex factors such as skilled labour having technical knowledge and good infrastructure for the company.
The another factor is the characteristics of the countries demand, there are certain demands for the country to run a business provide two potentially powerful sources for the competitive advantages to a global competitor .The first one is implementing a good strategy in the company such as meeting the local needs of the employee, try to solve the local problems arising in the company and gain more knowledge to know the situation and think how to take the gain proprietary decision. These ideas have to be learned before a company moves to early compete globally. Other benefits of local demands condition is a base load of demand of different varies of product will sought after in the international markets.
Another factor which is third determinant for a global platform is support lent by the government of the country which is entirely different from the porterâ€™s determinants factors. Here the government can offer a many advantages to the company such as incentives, having low tax structure or encouraging the activities of the organization by offering various subsidies incentives.
The rise of a company depends on the effective strategies and it will start from initial stage which is to be good, and this effective strategy should be adaptive to the business environment, exploit the ideas about what is distinctive in these capabilities. It should be always adaptive and opportunistic. Planning should be done properly before adapting a strategy, many assessments to be done with in the firms. Building a unique task is more difficult if they were not the capability would soon cease to be distinctive .It is easier to find the unique capabilities than to create them. So before creating strategies for an organisation it is necessary to understand the distinct capabilities.