Marketing Basics 4

Types of Marketing Strategy
One of the most important concepts of the marketing planning process is the need to develop a cohesive marketing strategy that guides tactical programs for the marketing decision areas. In marketing there are two levels to strategy formulation: General Marketing Strategies and Decision Area Strategies.
General Marketing Strategies:
These set the direction for all marketing efforts by describing, in general terms, how marketing will achieve its objectives. There are many different General Marketing Strategies, though most can be viewed as falling into one of the following categories:
· Market Expansion – This strategy looks to grow overall sales in one of two ways:
o Grow Sales with Existing Products – With this approach the marketer seeks to actively increase the overall sales of products the company currently markets. This can be accomplished by: 1) getting existing customers to buy more; 2) getting potential customers to buy (i.e., those who have yet to buy); or 3) selling current products in new markets.
o Grow Sales with New Products – With this approach the marketer seeks to achieve objectives through the introduction of new products. This can be accomplished by: 1) introducing updated versions or refinements to existing products; 2) introducing products that are extensions of current products; or 3) introducing new products not previously marketed.
· Market Share Growth – This strategy looks to increase the marketer’s overall percentage or share of market. In many cases this can only be accomplished by taking sales away from competitors. Consequently, this strategy often relies on aggressive marketing tactics.
· Niche Market – This strategy looks to obtain a commanding position within a certain segment of the overall market. Usually the niche market is much smaller in terms of total customers and sales volume than the overall market. Ideally this strategy looks to have the product viewed as being different from companies targeting the larger market.
· Status Quo – This strategy looks to maintain the marketer’s current position in the market, such as maintaining the same level of market share.
· Market Exit – This strategy looks to remove the product from the organization’s product mix. This can be accomplished by: 1) selling the product to another organization, or 2) eliminating the product.
Decision Area Strategies
These are used to achieve the General Marketing Strategies by guiding the decisions within important marketing areas (product, pricing, distribution, promotion, target marketing). For example, a General Marketing Strategy that centers on entering a new market with new products may be supported by Decision Area Strategies that include:
· Target Market Strategy – employ segmenting techniques
· Product Strategy – develop new product line
· Pricing Strategy – create price programs that offer lower pricing versus competitors
· Distribution Strategy – use methods to gain access to important distribution partners that service the target market
· Promotion Strategy – create a plan that can quickly build awareness of the product
Achieving the Decision Area Strategies is accomplished through the development of detailed Tactical Programs for each area. For instance, to meet the Pricing Strategy that lowers cost versus competitors’ products, the marketer may employ such tactics as: quantity discounts, trade-in allowances or sales volume incentives to distributors.