Marketing strategy is the set of programs that are matched with the target market opportunities in order to achieve organizational objectives. Drawing up a marketing strategy essentially consists of three steps: targeting market selection, setting market objectives and developing the marketing program.
A firm may choose to market its products to all users or to some sub-groups. The strategic decisions that a firm has to make are whether to sell the entire product market en masse or concentrate on a portion of the market. Secondly, it is very important to determine when an existing target market strategy needs to be modified. And finally, deciding when to stop serving a particular target market is also important. Products which become obsolete or irrelevant, are not able to survive against competition or show slow growth rates because of declining industry growth force managements to withdraw from a market.
Marketing objectives should be set and stated for each target market in quantitative terms like sales, market share and contribution to profit, and in qualitative terms like getting new customer groups, strengthening brand image, building customer awareness and attitudes, and educating the customers about brand features and uses. Market potential is the maximum possible sales of a product in a specific market in a specific time period. It is the aggregate of the sales possible by all the sellers in that industry.
The marketing program consists of strategic use of the variables that influence demand-the product, price, place and promotion. These four elements together constitute the marketing mix. The variables must be consistent with one another. A quality product image is inconsistent with a heavy price discount or making the product available at a low-cost retail outlet. A value-for-money or economy image is inconsistent with a highly stylized product placed in an exclusive retail outlet.
Targeting market selection without considering the firm’s resources and capabilities to design an appropriate marketing mix, or developing a marketing mix which matches the firms resources but does not consider target market requirements, are both mistakes.
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