Partnership to build Strategic Planning or Company and Marke ng Strategy:

Partnering to build Customer Rela onship

WHAT IS STRATEGIC PLANNING?
Strategic planning is the process of developing and maintaining a strategic
alignment between an organiza on's goals and capabili es and the evolving
opportuni es within the market.
It involves se ng long-term objec ves, assessing both internal strengths and
weaknesses and external opportuni es and threats, and formula ng strategies
to achieve these objec ves effec vely. This process ensures that an
organiza on’s resources and ac ons are op mally directed to respond to
changes in the market environment and to capitalize on emerging
opportuni es while addressing challenges.
Steps in Strategic Planning:
Strategic planning is a process that helps companies define their direc on and
allocate resources to achieve long-term goals. The process ensures that a
company is proac ve, rather than reac ve, to changes in its environment. Here
are the steps in detail:
1. Defining the Company Mission:
  What it is: A company's mission statement defines its core purpose,
values, and direc on. It serves as a founda on for strategic planning by
explaining why the company exists and what it seeks to achieve in the
long term.
 Purpose: It provides a sense of direc on and guides decision-making by
outlining the company's purpose and aspira ons.
 Example: Tesla's mission is “to accelerate the world’s transi on to
sustainable energy.” This mission guides its focus on electric vehicles,
solar energy, and ba ery technology.
 Impact: A clear mission statement ensures that all employees and
stakeholders understand the company’s long-term vision and are aligned
with its goals.

2. Se ng Company Objec ves and Goals:

 What it is: A er defining the mission, the company sets specific
objec ves and goals to turn that mission into ac onable steps. These are
usually measurable and me-bound targets that support the overall
mission.
 Types of Goals:
o Corporate Objec ves: Broad goals such as growth in revenue,
profitability, market share, or customer sa sfac on.
o Func onal Objec ves: Specific to various departments (e.g.,
marke ng, sales, R&D) and aligned with the corporate objec ves.
 Example: Apple might set an objec ve to increase its global market
share by 10% in the next two years through the launch of new,
innova ve products.
 Impact: Se ng clear objec ves ensures that all efforts are directed
toward achieving key business priori es. It also allows for performance
tracking and adjustments.

3. Designing the Business Por olio:

  What it is: The business por olio refers to the collec on of businesses
and products that the company owns. In this step, the company
evaluates its exis ng por olio and determines which
businesses/products to invest in, develop, or divest based on their
market poten al and alignment with the company's mission.
 Purpose: The goal is to balance investments in mature, stable businesses
with high-growth opportuni es, ensuring long-term profitability and
sustainability.
 Strategic Tools: Companies o en use tools like the BCG Matrix (Boston
Consul ng Group Matrix) to classify businesses as:
o Stars (high growth, high market share),
o Cash Cows (low growth, high market share),
o Ques on Marks (high growth, low market share),
o Dogs (low growth, low market share).
 Example: Samsung manages a diverse por olio, including consumer
electronics, smartphones, home appliances, and memory chips. It
allocates resources to the most promising areas like smartphones (Stars)
while scaling back investments in less profitable segments (Dogs).
 Impact: A well-managed por olio ensures the company can sustain
growth, diversify risk, and maximize return on investment.

4. Planning Marke ng and Other Func onal Strategies:

 What it is: This step involves developing detailed strategies for each
func onal area (e.g., marke ng, opera ons, finance, HR) to support the
company's objec ves and goals.
 Marke ng Strategy: A marke ng strategy defines how the company will
a ract and retain customers. It includes the 4 Ps (Product, Price, Place,
Promo on) and aims to deliver superior value to customers.
o Example: Coca-Cola uses a global marke ng strategy but adapts its
campaigns to fit local markets. It leverages its strong brand
iden ty, diversified product line, and a mix of tradi onal and
digital marke ng channels to reach consumers.
  Other Func onal Strategies: In addi on to marke ng, other
departments like opera ons, R&D, and HR also need specific strategies:
o Opera ons Strategy: Improving efficiency and cost-effec veness
(e.g., supply chain op miza on).
o HR Strategy: Ensuring the right talent is in place to execute the
plan.
o Finance Strategy: Alloca ng resources effec vely to achieve the
objec ves.
 Impact: By planning coordinated strategies across departments,
companies ensure that all aspects of the business work together to
achieve the overarching goals.
1 Defining the Company Mission
MISSION STATEMENT: A statement of the organiza on’s purpose- what it wants
to accomplish in the larger environment.
A mission is a clear, concise and enduring statement of the reasons for an
organisa on’s existence.
A mission statement is a concise declara on of an organiza on's core purpose,
values, and overall objec ves. It defines what the organiza on aims to achieve,
who it serves, and how it dis nguishes itself from others. A well-cra ed mission
statement serves as a guiding principle for decision-making, aligns the efforts of
employees, and communicates the organiza on’s purpose to stakeholders.
A mission statement asks..
 What is our business?
 Who is the customer?
 What do consumers value?
 What should our business be?
Example
Christ university is a nurturing ground for an individual’s holis c development to
make an effec ve contribu on to society in a dynamic environment.
DEFINING A MARKET-ORIENTED MISSION:
Characteris cs of a Good Mission Statement:
A good mission statement possesses several key characteris cs that ensure it
effec vely guides the organiza on and resonates with stakeholders. Here’s an
explana on of each characteris c:
1. Market Oriented:
o A market-oriented mission statement focuses on the needs and
expecta ons of the target market rather than solely on the
organiza on's internal processes or products. It emphasizes
understanding customer needs, preferences, and market dynamics.
This orienta on helps ensure that the organiza on remains relevant
and responsive to external changes.
2. Realis c:
o The mission statement should be grounded in reality, reflec ng
what the organiza on can realis cally achieve given its resources,
capabili es, and market condi ons. It should set a ainable goals
and be prac cal, avoiding overly ambi ous or una ainable
aspira ons that could lead to frustra on or disillusionment.
3. Specific:
o A specific mission statement clearly defines the organiza on’s
purpose and objec ves without being vague or ambiguous. It
outlines what the organiza on aims to achieve in concrete terms,
helping to align efforts and resources towards clear goals.
Specificity aids in crea ng focused strategies and measuring
progress.
4. Fit Market Environment:
o The mission statement should align with and adapt to the market
environment in which the organiza on operates. This means it
should reflect an understanding of current market trends,
compe ve dynamics, and industry developments. A mission
statement that fits the market environment ensures the
organiza on remains compe ve and responsive to external
factors.
5. Dis nc ve Competences:
 o A good mission statement highlights the organiza on's unique
strengths and capabili es that set it apart from compe tors. It
should convey what makes the organiza on special and how it
leverages its dis nc ve competences to achieve its objec ves. This
helps in building a strong brand iden ty and compe ve advantage.
6. Mo va ng:
o The mission statement should inspire and mo vate employees,
stakeholders, and customers. It should reflect a sense of purpose
and enthusiasm that drives engagement and commitment. A
mo va ng mission statement fosters a shared vision and
encourages dedica on towards achieving the organiza on’s goals.
2 Se ng Company Objec ves and Goals
3 Designing the Business Por olio
A business por olio refers to the collec on of different businesses, products,
and services that a company owns and manages. It represents the range of
investment and ac vi es the company is involved in and aims to op mize the
alloca on of resources among its various units to achieve strategic objec ves.
Business Por olio Planning involves two key steps:
1. Analyzing the Current Business Por olio: Analyzing the current business
por olio and decide which businesses should receive more, less or no
investment.
o Evalua on: Assess the performance and poten al of each business
unit or product within the por olio. This includes analyzing factors
like market share, profitability, growth poten al, and alignment
with the company's strategic goals.
o Resource Alloca on: Decide which businesses or products should
receive addi onal investment, which should have reduced
investment, and which might be candidates for dives ture or
discon nua on.
Understanding the Boston Consul ng Group (BCG) Matrix
The horizontal axis of the BCG Matrix represents the amount of market share of
a product and its strength in the par cular market. By using rela ve market
share, it helps measure a company’s compe veness.
The ver cal axis of the BCG Matrix represents the growth rate of a product and
its poten al to grow in a par cular market.
The BCG Matrix: Ques on Marks
Products in the ques on marks quadrant are in a market that is growing quickly
but where the product(s) have a low market share. Ques on marks are the most
managerially intensive products and require extensive investment and resources
to increase their market share. Investments in ques on marks are typically
funded by cash flows from the cash cow quadrant.
In the best-case scenario, a firm would ideally want to turn ques on marks into
stars (as indicated by A). If ques on marks do not succeed in becoming a market
leader, they end up becoming dogs when market growth declines.
The BCG Matrix: Dogs
Products in the dogs quadrant are in a market that is growing slowly and where
the product(s) have a low market share. Products in the dogs quadrant are
typically able to sustain themselves and provide cash flows, but the products will
never reach the stars quadrant. Firms typically phase out products in the dogs
quadrant (as indicated by B) unless the products are complementary to exis ng
products or are used for a compe ve purpose.
The BCG Matrix: Stars
Products in the star quadrant are in a market that is growing quickly and one
where the product(s) have a high market share. Products in the stars quadrant
are market-leading products and require significant investment to retain their
market posi on, boost growth, and maintain a compe ve advantage.
Stars consume a significant amount of cash but also generate large cash flows.
As the market matures and the products remain successful, stars will migrate to
become cash cows. Stars are a company’s prized possession and are top-of-mind
in a firm’s product por olio.
The BCG Matrix: Cash Cows
Products in the cash cows quadrant are in a market that is growing slowly and
where the product(s) have a high market share. Products in the cash cows
quadrant are thought of as products that are leaders in the marketplace. The
products already have a significant amount of investments in them and do not
require significant further investments to maintain their posi on.
Cash flows generated by cash cows are high and are generally used to finance
stars and ques on marks. Products in the cash cows quadrant are “milked” and
firms invest as li le cash as possible while reaping the profits generated from
the products.
Example:
 Apple’s Por olio:
o Stars: iPhones and MacBooks, which dominate their markets and
have high growth poten al.
o Cash Cows: iPads and accessories, which have steady demand and
require less investment.
o Ques on Marks: New product categories like Apple TV or Apple
Watch (ini ally), where future growth was uncertain but had
poten al.
 o Dogs: Older products like iPods, which saw declining sales and were
eventually phased out.
2. Shaping the Future Por olio: Shaping the future por olio by developing
strategies for growth and downsizing.
o Growth Strategies: Develop strategies to expand and grow the
business por olio. This may include entering new markets,
introducing new products or services, or acquiring other
companies. Common growth strategies include market penetra on,
market development, product development, and diversifica on.
o Downsizing Strategies: Iden fy areas where the company should
scale back or exit. This involves dives ng underperforming or non-
core businesses, reducing investment in low-growth areas, or
restructuring opera ons to improve efficiency. Downsizing helps
the company focus on its strengths and allocate resources more
effec vely.
Product market expansion grid

Market penetration strategy

Market penetration strategy is decided when the product is a current product

in an existing market. It falls in quadrant 1. Thus, in such a case, the customers
are aware about the product and due to one reason or another are not using
the product. There are three main tactics which a company can implement to
increase market penetration.

Market development strategy

The market development strategy is used when the product is an existing
product but the market is new. This strategy falls in quadrant 2 of the grid. A
company might decide to increase its territorial reach and therefore enter a
new market. The new market may have tough competitors, or it may happen
that the new company may be received very positively. In either of the cases,
there are three main tactics which the company can use for market
development.

Product development strategy

Product development is used when there is a new product which has to be

introduced in an existing market. It falls in quadrant 3 of the matrix. This may
be done because the companies products are not selling anymore or that the
company has identified new segments which it had missed before and wants
to introduce new product to increase product sales. There are majorly three
tactics which the company can use for Product development.

Diversification strategy

Diversification strategy is used when a company enters new markets with new
products. In such a scenario, the demands of the new market might be
different from the current markets where the company exists. Thus, the
company has to bring new products in new markets and hence the
complication rises. In such a case, there are 3 different tactics which a
company has to use to establish a diversification strategy.

Apple Inc. is known for shaping its future portfolio through innovation and
product development. When it transitioned from being just a computer
company to developing new products like the iPhone, iPad, and Apple Watch,
Apple successfully expanded its portfolio and entered new markets like
smartphones and wearables.

MARKET OFFERINGS
Market offerings refer to the combina on of products, services, informa on, or
experiences that a company provides to sa sfy the needs and wants of
customers in a specific target market. These offerings are designed to create
value not only for customers but also for collaborators (such as distributors or
suppliers) and stakeholders (including employees, investors, and partners).
It begins by clearly iden fying the target market in which the company will
compete. This involves understanding the specific needs of the target customers,
the compe on, and the role collaborators will play in delivering the offering.
To deliver a meaningful set of benefits, the company employs both strategy and
tac cs:
Strategy involves selec ng the market and defining the value the company
intends to create.
Tac cs, or the marke ng mix (product, price, place, promo on), bring the
strategy to life by defining key aspects of the offering that will sa sfy the
customers' needs and differen ate the company from compe tors.
The ul mate goal of the market offering is to deliver value that aligns with the
company’s objec ves while mee ng customer demands and leveraging
collabora ve partnerships for effec ve execu on.
Developing the Market Strategy
A market strategy is a blueprint that helps businesses define how they will create
and capture value in their chosen market. This process involves understanding
key factors like the customers, compe tors, collaborators, and context in which
the company operates.

Here’s a breakdown of the subpoints involved in developing a strong market

strategy:

1. Iden fying the Target Market

The target market is a group of poten al customers that the company seeks to
serve. In iden fying this market, the company considers several factors:

Customers: These are individuals or organiza ons whose needs the company
aims to fulfill. Understanding customer needs, desires, and pain points is cri cal
in designing an effec ve market offering.

Demographics: Age, gender, income, loca on

Behavior: Purchasing pa erns, brand loyalty, usage
Psychographics: A tudes, values, lifestyle preferences
Compe tors: Compe tors are other businesses aiming to sa sfy the same
customer needs. It's crucial to analyze compe tors' strengths, weaknesses,
market share, and how they posi on their offerings. Companies can compete
through differen a on, pricing, or superior customer experiences.

Collaborators: Collaborators are partners who help the company fulfill customer
needs. This includes suppliers, distributors, retailers, marke ng partners, and
more. Successful collabora ons can enhance the offering’s value and ensure
be er market reach.

Company: Internal factors such as the company’s resources, brand reputa on,
technological capabili es, and exper se in product development determine how
well it can serve the market. A company's ability to innovate, scale, and maintain
opera onal efficiency plays a significant role in its market success.

Context (Environmental Factors): This involves the broader economic,

technological, poli cal, and social factors that affect how the company develops
and manages its offering. For example, changes in regula on, economic
downturns, technological advancements, or cultural shi s can impact market
dynamics.

2. Market Offering
Once the target market is iden fied, the company designs its market offering to
meet customer needs be er than compe tors. The offering includes:

Core Product: The essen al solu on to the customer’s problem.

Value Proposi on: The total benefits customers will receive from the product or
service.
Branding: How the offering is posi oned in the market and how it will be
perceived by customers.
3. Business Por olios and Growth Strategies
Companies o en manage a por olio of products or businesses that serve
different market segments. Growth strategies involve expanding this por olio to
increase market share or enter new markets. The key growth strategies include:

Market Penetra on: Increasing sales in the current market with exis ng offerings
(e.g., through promo ons, pricing strategies).
Market Development: Expanding into new geographical areas or customer
segments with exis ng products.
Product Development: Crea ng new or improved products to meet exis ng
customer needs be er.
Diversifica on: Entering completely new markets with new products, o en to
spread risk or capitalize on new opportuni es.
These strategies are o en linked to the Ansoff Matrix, which helps businesses
decide on growth paths based on the rela onship between products and
markets.

4. Managing Collaborators
Collaborators play a crucial role in the company’s success by helping to distribute
products, promote offerings, or provide resources. Managing collaborator
rela onships involves:

Selec ng appropriate partners who align with the company’s goals.

Ensuring mutual benefit where both the company and collaborators gain from
the rela onship.
Building long-term rela onships that ensure a sustainable flow of resources,
support, and market access.
5. Adap ng to Context
The external environment (economic, regulatory, technological) constantly
evolves, and a company must adapt to maintain its market posi on. This means
monitoring trends and changes that may impact customer needs, compe on,
and the company's ability to deliver its offering.

Economic Factors: Infla on, unemployment, and consumer spending impact

demand.
Technological Trends: Innova ons may change how customers consume
products (e.g., digital transforma on).
Regulatory Changes: New laws or regula ons (e.g., privacy laws, trade
restric ons) can impact opera ons.
Cultural Shi s: Changing social norms or values can affect consumer preferences
and behaviors.
By systema cally iden fying and addressing each of these components, a
company can build a strong, effec ve market strategy that aligns its offerings
with customer needs while remaining compe ve and adap ve in a changing
environment.
DEVELOPING A VALUE PROPOSITION
Developing a value proposi on is essen al for businesses to communicate the
unique value they offer to customers, collaborators, and themselves. A strong
value proposi on clearly ar culates why a customer should buy from you, how
your offering benefits collaborators, and how it aligns with your company's
strategic goals.
1. Customer Value
This aspect of the value proposi on highlights the benefits the customer
receives from the product or service. It focuses on how the offering sa sfies the
customer’s needs, solves their problems, or improves their situa on. Customer
value is o en expressed in terms of product features, price, convenience, or
emo onal benefits.
Example:
Apple's iPhone Apple's customer value proposi on emphasizes innova on, ease
of use, and premium design. The iPhone isn't just marketed as a phone but as a
lifestyle product that enhances personal produc vity, crea vity, and
entertainment. Customers perceive value in the seamless integra on with other
Apple products, ease of use, and the premium experience.
2. Collaborator Value
Collaborator value represents the benefits that partners, suppliers, or other
stakeholders receive from working with the company. Collaborators may include
distributors, suppliers, or joint ventures, and their value proposi on focuses on
mutual growth, shared resources, and long-term rela onships.
Example:
McDonald's & Coca-Cola Partnership McDonald's and Coca-Cola have
maintained a strong partnership for decades, benefi ng both companies. Coca-
Cola provides McDonald's with consistent, high-quality beverages, while
McDonald's offers Coca-Cola broad exposure across its global network of
restaurants. The collaborator value here lies in mutual growth, brand
associa on, and access to a wider customer base.
3. Company Value
The company value aspect of the proposi on focuses on how the offering helps
the company achieve its objec ves, such as profitability, market share, or brand
equity. It reflects how the product or service aligns with the company’s overall
goals, contributes to its financial success, and strengthens its compe ve
advantage.
Example:
Amazon Prime For Amazon, the company value of Amazon Prime lies in customer
reten on and increased spending. The subscrip on service encourages
members to spend more frequently and across different categories. Prime not
only enhances customer loyalty but also boosts profitability by encouraging
larger orders and reducing marke ng costs for repeat customers.
How These Values Work Together:
To create a balanced value proposi on, companies need to ensure that the
offering creates value for all three groups—customers, collaborators, and the
company itself. If the value proposi on is weak in any of these areas, the offering
may struggle to achieve long-term success.
Example: Tesla
 Customer Value: Tesla’s electric vehicles offer high performance,
sustainability, and cu ng-edge technology. The cars appeal to customers
who value environmental responsibility and advanced features.
 Collaborator Value: Tesla’s suppliers and partners, such as ba ery
manufacturers, benefit from Tesla's innova on and growing demand for
electric vehicles. Collaborators also gain access to Tesla’s R&D capabili es
and brand pres ge.
Company Value: Tesla benefits from strong customer loyalty, a leadership
posi on in the electric vehicle market, and the ability to leverage its
proprietary technology for long-term growth and profitability.

"Designing Marke ng Tac cs," emphasizing the intersec on of Company

Value, Customer Value, and Collaborator Value, with a focus on OVP
(Op mal Value Proposi on). Below this is a list of elements involved in a
Market Offering, including Product, Price, Communica on, Service, Brand,
Incen ves, and Distribu on.

Let’s break down each aspect with examples:

1. Company Value
This refers to the value a business gains from its marke ng strategies and
ac vi es. The company must ensure that its tac cs generate profit,
improve its brand, and contribute to sustainable growth.

Example: A smartphone company might launch a new device with

innova ve features. The company value here would be improved brand
recogni on, increased sales, and market share. The launch also posi ons
the company as a technology leader.
2. Customer Value
This focuses on what the customer gains from the product or service—
such as mee ng needs, solving problems, or enhancing experiences.
Marke ng tac cs should aim to provide value to customers in a way that
resonates with their expecta ons and desires.

Example: A streaming service like Ne lix offers a customer value of

convenience (on-demand entertainment) and personalized
 recommenda ons. Customers value its extensive content library and ease
of access, making it an a rac ve service.
3. Collaborator Value
Collaborators include any external partners—suppliers, distributors, and
stakeholders—that work with the company. The company needs to ensure
that these rela onships are mutually beneficial, crea ng value for
collaborators as well.

Example: A fast-food chain like McDonald's works closely with suppliers to

ensure quality and mely delivery of ingredients. These suppliers, in turn,
benefit from a stable business partnership and predictable demand,
crea ng value on both sides.
4. OVP (Op mal Value Proposi on)
The OVP is where the company’s, customer’s, and collaborator’s values
intersect. It represents the balance between all three, crea ng a win-win
situa on. The aim is to design strategies that benefit everyone involved.

Example: A cosme cs brand offering eco-friendly products is a good

illustra on of OVP. The company gains from increased sales and brand
loyalty (Company Value). Customers benefit from high-quality,
environmentally sustainable products (Customer Value). Collaborators,
such as ingredient suppliers, benefit from a consistent and profitable
rela onship (Collaborator Value).
3 Detail marke ng’s role in strategic planning
Strategic Marke ng Planning
Marke ng plays a crucial role in strategic planning, as it aligns the
company’s goals with market needs, opportuni es, and compe ve
dynamics. The process of strategic planning includes shaping the
company's direc on, iden fying market opportuni es, crea ng effec ve
strategies, and ensuring that value is delivered effec vely to customers.
Here’s how marke ng influences strategic planning, broken down by key
roles:
1. Provide a Guiding Philosophy
Marke ng provides the founda onal philosophy for a company's overall
strategic direc on, which is o en customer-centric. A market-oriented
approach ensures that the company’s products and services are
developed based on consumer needs and desires. This aligns with the
company’s mission, vision, and values.
Example:
Amazon follows a customer-centric philosophy, encapsulated in its
mission "to be Earth's most customer-centric company." This philosophy
drives everything from product development (focusing on convenience
and variety) to innova ons like Amazon Prime. Their marke ng ensures
that customer sa sfac on remains at the heart of all strategic ini a ves.

2. Iden fy A rac ve Opportuni es

Marke ng helps companies analyze the market environment, customer
preferences, and compe ve landscape to spot emerging trends and
untapped opportuni es. This is achieved through market research,
consumer feedback, and compe ve analysis. These insights are cri cal
to direc ng resources where they are most likely to yield high returns.
Example:
Ne lix iden fied an opportunity in the shi from tradi onal TV to
streaming services. By leveraging data about viewing habits and user
preferences, it expanded from DVD rentals to become a global leader in
video streaming. Ne lix con nues to use customer data to iden fy
content opportuni es, driving original programming like Stranger Things
to appeal to its target audiences.

3. Design Effec ve Strategies

A er iden fying opportuni es, marke ng cra s strategies to effec vely
target key market segments, establish a compe ve advantage, and
deliver unique value proposi ons. This includes determining the best
marke ng mix (Product, Price, Place, Promo on) and ensuring all
marke ng ac vi es are integrated.
Example:
Starbucks designed an effec ve strategy by blending premium pricing
with a focus on crea ng a unique "third place" experience between home
and work. By offering a premium coffee experience, personalized service,
and emphasizing brand loyalty through digital pla orms like the Starbucks
app, they were able to differen ate themselves from other coffee chains.

4. Build Strong Value Chains

 A value chain refers to all the ac vi es that go into producing and
delivering a product or service, from suppliers to final customers.
Marke ng plays a key role in ensuring that each step of the value chain
adds value to the customer, whether through be er quality, faster
delivery, or more innova ve features.
Example:
Zara excels in building a strong value chain by integra ng its design,
manufacturing, and distribu on processes. Zara’s marke ng emphasizes
the company’s ability to get new fashion trends to stores within weeks,
which is a key differen ator. This speed-to-market, combined with its in-
house produc on and efficient distribu on, gives Zara a compe ve
advantage in the fast fashion industry.

5. Form Superior Value Delivery Networks

A value delivery network includes a company’s suppliers, distributors, and
any other partners that help bring the product to market. Marke ng
ensures that the network is op mized to deliver superior value to
customers. It also includes building partnerships that enhance the brand’s
capabili es to meet consumer demands more efficiently.
Example:
Apple has built an exemplary value delivery network with its suppliers and
retailers. The company maintains ght control over every aspect of
produc on, from sourcing materials to product design. Apple's exclusive
retail stores, authorized resellers, and online presence work together to
ensure that customers receive a seamless experience, from purchase to
a er-sales service. This superior value delivery network has enabled Apple
to maintain its premium posi oning in the market.
4. Describe elements of customer-driven marketing strategy and marketing
mix

Customer-Driven Marke ng Strategy

A customer-driven marke ng strategy focuses on tailoring marke ng efforts to
meet the specific needs, preferences, and behaviors of dis nct customer groups.
This approach is key for businesses looking to op mize their marke ng outcomes
and maximize customer sa sfac on. Let's break down the key elements: Market
Segmenta on, Targe ng, and Posi oning—o en referred to as STP
(Segmenta on, Targe ng, Posi oning).
1. Market Segmenta on
Defini on:
Market segmenta on involves dividing a broad market into smaller groups of
consumers who have similar needs, characteris cs, or behaviors and who
respond similarly to marke ng efforts. These groups are segmented based on
criteria such as demographics (age, gender, income), psychographics (lifestyle,
values), geographic loca on, and behavior (loyalty, purchase history).
Example:
 Coca-Cola segments its market by product preferences. Some consumers
prefer sugary so drinks, while others seek healthier op ons. Coca-Cola
targets health-conscious consumers with its Coca-Cola Zero Sugar and
those seeking energy boosts with Powerade. Through segmenta on,
Coca-Cola tailors its marke ng to each consumer group effec vely.

2. Targe ng
Defini on:
Targe ng is the process of evalua ng each iden fied market segment and
selec ng one or more to focus marke ng efforts on. Companies analyze the size,
growth poten al, and compe ve dynamics of each segment to determine
which ones align best with their resources and objec ves.
Example:
 Nike targets mul ple consumer segments, but one of its key target groups
is athletes and fitness enthusiasts. Nike uses endorsements from famous
athletes like LeBron James and Serena Williams to appeal to this segment.
The company customizes its marke ng, offering high-performance
products to meet the demands of this athle c segment while also
targe ng everyday consumers through its fashion-focused lines.

3. Posi oning
Defini on:
Posi oning is about arranging for a product to occupy a dis nc ve place in the
minds of the target audience, rela ve to compe ng products. The goal is to
ensure that consumers see the product as offering unique and desirable benefits
that set it apart.
Example:
 Apple posi ons itself as a premium, innova on-driven brand in the tech
industry. With products like the iPhone, Apple emphasizes simplicity,
luxury, and innova on. Through sleek design, cu ng-edge technology,
and a strong ecosystem (like iOS and App Store), Apple has created a
percep on of exclusivity and superior quality. This posi ons the brand
dis nc vely in consumers' minds compared to compe tors like Samsung
or Google.

STP Example: Tesla

 Segmenta on: Tesla segments its market based on factors like
environmental awareness, income, and technological savviness. Tesla
appeals to consumers who priori ze sustainability and innova on.
 Targe ng: Tesla ini ally targeted high-income, environmentally conscious
consumers by launching high-end electric vehicles like the Model S. Over
me, Tesla has expanded its target to include middle-income consumers
with more affordable models like the Model 3.
 Posi oning: Tesla posi ons itself as the leader in the electric vehicle (EV)
industry. It focuses on cu ng-edge technology, sustainability, and luxury,
offering high-performance cars that are environmentally friendly. Tesla’s
posi oning as the premier EV brand differen ates it from tradi onal car
companies and other electric vehicle manufacturers.
What is Marketing Mix?
Marketing Mix is a set of marketing tool or tactics, used to promote a
product or services in the market and sell it. It is about positioning a
product and deciding it to sell in the right place, at the right price and right
time. The product will then be sold, according to marketing and
promotional strategy. The components of the marketing mix consist of 4Ps
Product, Price, Place, and Promotion. In the business sector, the marketing
managers plan a marketing strategy taking into consideration all the 4Ps.
However, nowadays, the marketing mix increasingly includes several other
Ps for vital development.

The marketing mix is a set of controllable factors that companies use to

influence consumers' purchasing decisions. Known as the 4Ps—Product,
Price, Place, and Promotion—it forms the backbone of a company's
marketing strategy. These elements are crucial in aligning a company’s
products or services with customer needs and expectations.

Developing the market mix

1. Product

The product is the actual good or service offered to customers. It

encompasses various factors like quality, design, features, packaging, and
the overall brand. The product should meet customer needs and offer
unique value compared to competitors.
Key Elements of Product:

 Core Product: The essential benefit that satisfies the customer’s need.

 Actual Product: Includes the design, brand name, quality, and features.

 Augmented Product: Additional services or benefits like after-sales

service, warranty, and customer support.

Example:

Apple's iPhone is a prime example of effective product strategy. Apple

focuses on the product's design, user-friendly interface, and consistent
innovation. The iPhone offers a premium experience with its sleek design,
high-quality camera, software integration, and seamless connectivity with
other Apple products. Its augmented features, such as warranty, iCloud
services, and strong customer support, enhance its value proposition.

2. Price

Price is the amount of money customers are willing to pay for a product.
Pricing strategies depend on factors like production costs, perceived value,
competition, and market conditions. A well-structured pricing model should
reflect the brand's positioning, target customer segments, and overall
profitability goals.

Key Pricing Strategies:

 Cost-plus pricing: Adding a markup to the cost of production.

 Penetration pricing: Setting a low price to enter the market quickly and
gain market share.

 Skimming pricing: Setting a high price initially and lowering it later to

attract price-sensitive consumers.

 Competitive pricing: Pricing based on competitors' prices.

Example:
Tesla uses a premium pricing strategy for its electric vehicles (EVs). Tesla
positions itself as a luxury brand with innovative technology, offering
electric cars with advanced features like autopilot and long-range battery
life. The high price reflects the perceived value of being a leader in EV
technology and sustainable energy solutions. Tesla’s high pricing also aligns
with its brand promise of luxury and innovation.

3. Place

Place refers to the distribution channels through which the product is sold
and how it reaches the consumer. The objective is to ensure the product is
available at the right location, at the right time, and in the right quantity.
This could be physical locations (retail stores), online platforms (e-
commerce), or a combination of both.

Key Distribution Strategies:

 Direct distribution: Selling directly to customers without intermediaries

(e.g., online stores).

 Indirect distribution: Using intermediaries like wholesalers and retailers.

 Selective distribution: Limiting the availability of a product to select

outlets.

 Intensive distribution: Making a product available through as many

outlets as possible.

Example:

Amazon employs a comprehensive distribution strategy that leverages its e-

commerce platform and extensive logistics network. Through its online
platform, customers can browse, purchase, and receive products at their
convenience. Amazon also uses sophisticated warehousing and delivery
systems (like Amazon Prime) to ensure fast and efficient delivery. This
distribution strategy has made Amazon a leader in global online retail.

4. Promotion
Promotion involves all the communication strategies used to inform,
persuade, and remind customers about a product or service. It includes
advertising, public relations, sales promotions, digital marketing, and
personal selling. The goal is to create awareness, generate interest, and
encourage purchasing behavior.

Key Promotional Tools:

 Advertising: TV, radio, online, and print media.

 Sales promotions: Discounts, coupons, contests, and free trials.

 Public relations: Media coverage, sponsorships, and partnerships.

 Personal selling: Direct interaction between salespeople and customers.

Example:

Coca-Cola is renowned for its promotional strategies. It uses a blend of

traditional advertising (TV, billboards, print) and modern digital marketing
(social media, influencer marketing). Coca-Cola's iconic "Share a Coke"
campaign personalized bottles with people’s names, encouraging social
sharing and creating a viral effect. The company's promotions emphasize
fun, happiness, and social connections, aligning with its brand image.

Extended Marketing Mix: 7Ps

In service-oriented industries, the marketing mix expands beyond the 4Ps to

include three additional elements: People, Process, and Physical Evidence.

 People: Refers to employees and customer service staff who directly

influence the quality of the service delivered. (e.g., in hospitality, staff
friendliness and professionalism are crucial).

 Process: The systems and procedures used to deliver the service (e.g.,
efficient online booking systems for airlines).

 Physical Evidence: The physical environment where the service is

delivered (e.g., the ambiance of a luxury hotel).

Example of 7Ps:
 Starbucks integrates the additional 3Ps effectively. Starbucks focuses on
people (well-trained, friendly baristas), process (fast service, online
ordering), and physical evidence (welcoming store ambiance with
comfortable seating and music). These elements contribute to the customer
experience, building loyalty and brand value.

5. List the marketing management functions

Managing the marke ng efforts.

Managing marke ng efforts requires a structured approach to ensure
that goals are met efficiently. This approach involves several core
marke ng func ons: Goals, Strategy, Tac cs, Implementa on, and
Control. These func ons help companies align their marke ng ac ons
with their overall business objec ves and ensure that campaigns
deliver results.
1. Goals
Marke ng goals are the specific, measurable objec ves that a
company seeks to achieve through its marke ng efforts. These goals
are typically aligned with broader business objec ves and may include
increasing brand awareness, driving sales, entering a new market, or
improving customer reten on.
2. Strategy
Once the goals are defined, the next step is to develop a marke ng
strategy. The strategy outlines the overarching approach the company
will take to achieve its marke ng goals. It involves iden fying target
audiences, understanding customer needs, posi oning the product,
and deciding which marke ng mix elements (Product, Price, Place,
Promo on) will be most effec ve.
3. Tac cs
Tac cs are the specific ac ons and campaigns that will be carried out
to implement the strategy. They are short-term, prac cal steps used to
execute the strategy and can involve adver sing campaigns,
promo onal offers, social media content, or email marke ng.
4. Implementa on
This phase is about pu ng the tac cs into ac on. It involves alloca ng
resources (budget, personnel, technology), se ng melines, and
coordina ng various departments to ensure that the tac cs are
executed efficiently. This step requires careful project management to
ensure that all aspects of the marke ng plan are carried out as
intended.
5. Control
Control refers to the process of monitoring the results of marke ng
efforts and making necessary adjustments.It Evaluates the results of
marke ng strategies and plans – Matrices likesales, customer
readiness, customer value, distribu on and communica on .It
involves se ng performance standards (such as key performance
indicators—KPIs), measuring actual performance, and comparing it
with the goals. If discrepancies arise, correc ve ac ons are taken to
align marke ng efforts with the original objec ves.

Example of Managing Marke ng Efforts: Coca-Cola

Let’s apply this framework to Coca-Cola:
1. Goals: Increase sales of Diet Coke by 10% among health-
conscious millennials in urban markets over the next six months.
2. Strategy: Posi on Diet Coke as a healthier and trendy alterna ve
to sugary drinks, leveraging millennial preferences for wellness
and minimalism. Target urban millennials using digital channels.
3. Tac cs:
o Run an Instagram influencer campaign featuring fitness
and lifestyle influencers.
 o Offer discounts via mobile apps and partner with food
delivery services.
o Create a series of YouTube ads showcasing health-
conscious people enjoying Diet Coke in urban se ngs.
4. Implementa on:
o Allocate a $2 million budget to influencer partnerships and
digital ads.
o Deploy marke ng teams to manage the campaign across
different social media pla orms and coordinate with
influencers.
o Roll out the campaign over three months with weekly
progress check-ins.
5. Control:
o Track sales data and compare it to the 10% target.
o Monitor social media engagement and the performance of
YouTube ads (views, clicks).
o Adjust tac cs mid-campaign if necessary by increasing
influencer collabora ons or revising the crea ve content of
the ads.