Fundamentals of Business

Two Levels of Marketing

Strategic Marketing
Strategic Marketing attempts to determine how an organization competes against its competition in a market place. In particular, it aims at generating a competitive advantage relative to its competition. When Jack Trout says that marketing is the war between competitors and the conflict between companies what he is really doing is defining marketing at the business level.

Strategic marketing process

Step 1: Develop a vision, mission and set objectives:
Top management needs to determine what type of business to run and where the business wants to be in 15 - 20 years time.

Step 2: Information needs to be gathered from the environment, To enable management to make well informed decisions.
The environment is divided into three main parts namely the Micro environment
This represents the business itself and is also known as the internal environment, The market environment
this represents part of the external environment and engages those participants that closely interact with the business The macro environment (this represents political (policies & license),economical and social environment of the region). This is also part of the external environment but there is limited direct interaction with the business. An assessment of all three environments is known as a situation analysis. All data gathered during the situation analysis must be processed into a usable format so that the managers can use it (known as information). An aid in analyzing the information to support management in decision making is using a SWOT grid. A SWOT grid is a summary of the findings of the situation analysis in Strengths, Weaknesses (both from the internal environment) and Opportunities and Threats (both from the external environment).

Step 3: Decision making.
Once the marketing managers are in possession of suitable information, they embark on a process of decision making. The combined result of the decisions forms the marketing strategy. First the marketing manager will (in conjunction with the top management of the business) participate in determining the main strategic direction of the business. Based on the information available, they decide whether it is appropriate to grow the business, keep it as it is, turn it around or even get out of the market (divest). After this decision has been made, the marketing manager must decide what competitive advantages a business possesses. A decision on segmentation follows, and from these segments a business can decide which and how many segments to select as target markets.

Following the selection of target markets, a positioning sub strategy should be created for each and every target market selected to serve. Positioning consists of two steps. First, the positioning instruments (marketing mix variables) are employed to create in the mind of a consumer a favourable picture of the business when compared to rivals. Secondly, the position should be communicated to the targeted consumers by using one of the positioning instruments, namely marketing communication. Marketing communication consists of the communication mix (instruments), such as personal selling, advertising, publicity, public relations and sales promotion.

Step 4: Implementation.
Once all the decisions are made it is said that the strategy is created. It can be the best strategy ever, but if it stays on paper nothing will happen. Implementation is a two part process. The first is the development of the marketing plan. The second is the development of an action plan. A simplified example of an action plan: (Flowcharting can help here) Action i.e. Budget Responsible person Starting date Completion date.
Many influences exert pressure on the environment. Some of these include your own and your competitors' business decisions and the government. These pressures cause the environment to change, thus forcing businesses to revisit their visions, missions and objectives and the whole strategic process repeats itself.