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Marketing Strategy Flashcards

1
Q

In your opinion, what are potential criteria for determining the target market(s)?

A 
I. Size and Growth
1. Size: Market potential, current market penetration
2. Growth: Past growth forecasts of technology change
II. Structural Characteristics
3. Competition
4. Segment saturation
5. Protectability
6. Environmental risk
III. Product-Market Fit
7. Fit
8. Relationships with segments
9. Profitability
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2
Q

What are potential benefits of segmentation to organisations?

A
  1. Identification of unfulfilled needs
  2. Better product design
  3. Allows specific and targeted promotion activities 4. Increasing customers’ satisfaction
    → SUSTAINABLE PROFIT GROWTH
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3
Q

What are potential benefits of segmentation to customers?

A
  1. More convenience and time savings
  2. Tailored products and services
  3. Relevant offers
  4. Increased personalized experience
    → COMPELLING CUSTOMER EXPERIENCES
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4
Q

What are benefits of standardising the market strategy across all countries?

A
  1. Cost synergies (economies of scale, economies of simplicity)
  2. Anticipation of converging customer needs
  3. Negotiation with international customers and retailers
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5
Q

What are the problems of standardising the market strategy across all countries?

A

Limited flexibility

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6
Q

What are the benefits of differentiating the market strategy across the countries?

A
  1. Meeting specific local market characteristics (customer needs, ecological and legal aspects) → local market orientation
  2. Addressing country-of-origin effects
  3. Strategic benefits (price, product and brand strategy
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7
Q

What are the problems of differentiating the market strategy across the countries?

A

High costs

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8
Q

Definition of marketing strategy

A

Marketing strategy includes all basic and long-term activities in the field of marketing that deal with:

  1. the analysis of the strategic initial situation of a company and
  2. the formulation, evaluation and selection of market- oriented strategies

and therefore contributes to the goals of the company and its marketing objectives.

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9
Q

Objectives pyramid of marketing strategy

A
  1. BUSINESS MISSION
  2. COMPANY OBJECTIVES
  3. FUNCTIONAL OBJECTIVES
  4. INSTRUMENTAL OBJECTIVES
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10
Q

Objectives related to…

A

A. POTENTIAL

  1. Prerequisites of customer behaviour and market success
  2. Examples: customer satisfaction

B. MARKET SUCCESS

  1. Actual customer behaviour
  2. Examples: customer loyalty

C. FINANCIAL ASPECTS

  1. Economic success
  2. Examples: turnover, profit
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11
Q

“Classical” marketing strategy approaches

A
  1. Experience curve model

2. Lifecycle model

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12
Q

Explain experience curve model

A

Key variable: development of product costs over time

Idea: the more often a task is performed the lower the costs of performing this task become. More specifically, this effect leads to a reduction in costs depending on the amount of “experience” accumulated over time.

Formula for the law of experience curve:
k(x) = a ⋅ x^ − b

Beginning of the 20th century:
• Growing demand for automobiles but product still quite expensive
• Fords implements strategy of price leadership by decreasing production costs
• Standardisation of products (only black automobiles)
Consequences:
• Cost decrease of about 75% within 14 years
• Price decreased from over $ 3,000 to ca. $ 1,000 and market share increased from 10% to 55%

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13
Q

What’s the experience curve’s model relevance for pricing decisions?

A

Relevance for pricing decisions:
• Forecasting of costs (helps setting the “right” price)
• Model relevant when price is driving factor for consumers

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14
Q

What are the limitations of experience curve model?

A
  • Simplification: Focus only on one variable: costs

* Requirement of a consistent product identity over time

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15
Q

Explain lifecycle model

DRAW CURVE WITH PHASES!

A

Assumptions:
Product has limited life time and goes through several life cycle phases Each phase has different sales and profit potentials

INTRODUCTION
GROWTH
MATURITY
SATURATION

RELEVANCE:
• Product life span is limited → importance of knowing current phase of a product (resource allocation)

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16
Q

What are the limitations of the lifecycle model?

A

Limitations:

  1. Simplification: Focus only on one variable to explain sales (time)
  2. Several alternative shapes of curve observed: not all products and brands exhibit the bell-shaped curve
  3. Ignores management ability to influence shape of curve, economic and marketing activities (e.g. face lifting car model), and legal issues (e.g. protection by a patent)
17
Q

What is the strategy process?

A
  1. Analysis of initial strategic situation:
    • Environment
    • Market
    • Company situation
  2. Formulation of alternative marketing strategies
  3. Evaluation of alternative marketing strategies
  4. Selection of marketing strategies
  5. Strategy implementation and implementation monitoring
18
Q

What’s the microenvironment in marketing and what is the microenvironment

A

MACROENVIRONMENT: Global environmental factors
MICROENVIRONMENT:
Market

19
Q

Macroenvironment elements

A
  1. Demographics
  2. Nature
  3. Technology
  4. Sociocultural context
  5. Economy
  6. Political-legal context
20
Q

What is the objective of market segmentation?

A

To identify distinct subsets of customers with common needs or characteristics, which are economically interesting, and to target them distinctively.

The goal of market segmentation is targeting the customers exactly as they want to be targeted…

21
Q

What is the process of segmentation?

A 
1. SEGMENTATION
• Determination of segmentation criteria
• Compile segment profiles and
characteristics
• Validate segments
2. TARGETING
• Determination of evaluation criteria
• Evaluate the segments
• Decide which and how many segments
should be targeted
3. POSITIONING
• Develop a deep understanding of the segments
• Derive target-positioning for each segment
• Develop marketing actions and instruments
per segment (e.g., marketing mix)
22
Q

What are the goals of market segmentation?

A
  1. Cluster customers in groups
  2. Homogeneity within the groups
  3. Heterogeneity across the groups
23
Q

What are the segmentation requirements?

A
  1. Behavioural relevance/ actionability
  2. Accessibility/ responsiveness
  3. Clear differentiation
  4. Measurability
  5. Stability over time
  6. Economic feasibility/substantiality
24
Q

What are the segmentation approaches?

DRAW DIAGRAM

A

Slide 38

  1. DEMOGRAPHIC
  2. BEHAVIOURAL
  3. BENEFIT
  4. SOCIOECONOMIC
  5. PSYCHOGRAPHIC
25
Q

7 Global Consumer Types

A 
1. Undaunted striver
(Confident, status-orientated, tech-savvy)
2. Independent sceptic
(Unconventional, skeptical, indifferent)
3. Balanced optimist
(Quality seeking, practical, optimistic)
4. Impulsive spender
(Social, indulgent, friend focused)
5. Secure traditionalist
(settled in ways, independent, frugal) 
6. Aspiring struggler
(Uncertain, stressed, approval seeking)
7. Conservative homebody
(family-focused, private, minimalistic)
26
Q

What is positioning?

A

Positioning involves designing an offering so that the target segment members perceive it in a distinct and valued way relative to competitors

27
Q

What are the three ways to position an offering?

A
  1. Unique
    (“Only product/service with XXX”)
  2. Difference
    (“More than twice the [feature] vs. [competitor]”)
  3. Similarities
    (“Same functionality as [competitor]; lower price”)
28
Q

What’s the strategic triangle of customer benefits and positioning?

DRAW!

A 
1. CUSTOMER
Value - Price
2. COMPANY'S PRODUCT
Competitive Advantage
3. COMPETITOR'S PRODUCT
Value - Price

Slide 60

29
Q

What are the competitive strategies?

A
  1. Cost leadership
  2. Differentiation
    a) based on superior products
    b) based on better customer relationships
30
Q

Draw the Ansoff growth matrix

A

Slide 64

31
Q

What are the reasons for customer loyalty?

A
  1. Psychological
  2. Economic
  3. Technical, functional
  4. Contractual
32
Q

Special decisions related to the international marketing strategy

A
  1. Determination of the degree of inter- nationalization
  2. Selection/ prioritization of country markets
  3. Design and
    structure of international market developments
    a) Selection of the form of international market entry
    b) Decision about the timing of international market entry
  4. Decision regarding the cross-national standard- ization of marketing activities
  5. Decision concerning the relationship between head office and local entities
33
Q

Timing types of international market entries

A
  1. Waterfall strategy
  2. Sprinkler strategy
  3. Hybrid strategy
34
Q

Benefits of waterfall strategy

A
  1. Requires lower investments than sprinkler (launch in all countries at same time requires high investments in manufacturing, inventory etc.)
  2. Revenues from an early market can be used for investment in a subsequent market
35
Q

Benefits of Sprinkler strategy

A
  1. Maximizing revenues by fully exploiting economies of scale and experience in R&D
  2. If competition is a threat, sprinkler strategy may pre- empt competitive moves (maximizing market share)

Marketing (7 decks)

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