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Session: 1

Introductions and Course Orientation

WELCOME TO STRATEGIC MARKETING

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SESSION 1
INTRODUCTIONS AND ORIENTATION
Introductions Orientation and Course Overview Grading Criteria Recommended Books How to get good Grades

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Learning Objectives
Market-driven business strategy-role in

Process of becoming Market Oriented Capabilities of organizations market driven

Creating value for customers Initiatives & challenges of becoming Market driven
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Market-Driven Strategy Characteristics of Market-Driven Strategies


1. 2. 3. 4. Become Market Oriented Determine capabilities Matching customer value requirements to capabilities Achieving Superior Performance

Become market oriented

Achieving Determine superior distinctive performance capabilities Matching customer value requiremen ts to capabilities

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Marketing Driven Strategy Pivotal role in Business


Why pursue a Market Driven strategy ? Blurring boundaries Innovative business models High pace of market change Uncertainty of business environment New forms of competition
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Becoming Market Oriented


Process of becoming Market-Oriented: A customer focus Competitor intelligence Coordination among business functions Make changes in: i. ii. iii. iv. v. vi. vii. viii. Culture, Processes Interrelated actions are required including information acquisition Sharing information in organization Inter-functional assessments Shared diagnosis Decision making AND

Customer focus

Competitor intelligence

Customer
Make Other changes

Business functions Integration

Top Management Middle management Customer


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Customers
Middle management Top Management

Capabilities

Organizational Capabilities
Skills Knowledge Functional coordination Assets

Capabilities are Organizational processes which: 1. Enable firms to coordinate related activities 2. To employ assets and 3. Using skills & accumulated knowledge

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Identifying Distinctive Capabilities


A distinctive Capability offers 1. Disproportionately higher contribution to customer value 2. Enable delivery of customer value at lower cost
Criteria to evaluate Distinctive capabilities: Be superior to competition Difficult to copy Applicable to multiple competitive situations Companies start assessments of their current capabilities (competence)

Superior to competitors

Difficult to copy

Examples: 1. Wapdas Distribution Network 2. ? 3. ?

Applicable in Multiple competitive situations

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Types of Capabilities

Outside-in
Spanning Processes

Inside-out

Outside-in processes (External emphasis) Market sensing Customer linking Channel bonding Technology monitoring

Inside-out processes (Internal emphasis) Financial management Cost control Manufacturing Technology development

Spanning Processes Customer order fulfillment Pricing Customer service delivery


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Matching Capabilities to Value Opportunities


A Market oriented company identifies value opportunities by : 1. Market sensing processes 2. Shared Diagnosis processes 3. Cross-functional decision making

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Creating Customer Value Customer value trickles down as a result from a process of anchoring business strategy with customer needs Customers form value expectations and decide to purchase goods and services

Providing Customer Value: Distinctive capabilities are used to deliver value to customer by: Differentiating the product offer Offering lower prices, relative to competitors brands or Combination of both above Value Initiatives: Analyzing customer needs and instilling customer-focused behavior in frontline employees Analyzing target markets and boosting service quality Others
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Becoming Market-Driven
The process is characterized by three stages or steps: Becoming market-oriented Indentifying and leveraging distinctive capabilities Matching Distinctive capabilities to customers value requirements

Marketoriented

Distinctive capabilities

Match capabilities to customers value requirements

Superior Customer Value

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Becoming Market-Driven
Characteristics of becoming market driven Market sensing and customer linking capabilities i. Effective market sensing processes that spread cross functionally in organizations ii. Information is collected and analyzed and shared cross sectional iii. Information analysis defines the role of each department in being market driven Customer linking capabilities i. Helpful in preventing customer churn ii. Can lead to stronger customer bonds iii. Can create a better customer feedback formal and informal

Aligning structures and processes i. Companies need to take customer value initiatives i.e ii. Redesign or align current structure with customer value requirements iii. Redesign or align current processes with customer value requirements

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Challenges of a new era for Strategic Marketing


Characteristics of becoming market driven Escalating Globalization i. Global marketplace is dynamic and complex ii. Globalization affects the competitiveness of economies iii. High risks of being outmaneuvered by rising globalization

Technology diversity and uncertainty i. Rapid technological advancements are changing the basis of many markets ii. Many new opportunities emerge iii. Many established markets are being sidelined by the emerging technology
Ethical Behavior and social responsibility i. ii. iii. Escalating need for a ethical behavior on the part of the managers Need for escalating transparency Emphasis on Corporate citizenship
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Re-cap
Escalating Globalization i. Global marketplace is dynamic and complex ii. Globalization affects the competitiveness of economies iii. High risks of being outmaneuvered by rising globalization
Technology diversity and uncertainty i. Rapid technological advancements are changing the basis of many markets ii. Many new opportunities emerge iii. Many established markets are being sidelined by the emerging technology

Ethical Behavior and social responsibility


i. ii. iii. Escalating need for a ethical behavior on the part of the managers Need for escalating transparency Emphasis on Corporate citizenship
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