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Factors such as market penetration, market share, profit margins, budgets, financial analysis, capital investment, government actions, demographic changes, emerging technology and cultural trends are also addressed.
There are two major components to your marketing strategy: However, in concert with defining the marketing strategy you must also have a well defined methodology for the day to day process of implementing it.
It is of little value to have a strategy if you lack either the resources or the expertise to implement it. In the process of creating a marketing strategy you must consider many factors.
Of those many factors, some are more important than others. However, many are common to all marketing strategies. Some of the more critical are described below.
You begin the creation of your strategy by deciding what the overall objective of your enterprise should be. In general this falls into one of four categories: If the market is very attractive and your enterprise is one of the strongest in the industry you will want to invest your best resources in support of your offering.
If the market is very attractive but your enterprise is one of the weaker ones in the industry you must concentrate on strengthening the enterprise, using your offering as a stepping stone toward this objective.
If the market is not especially attractive, but your enterprise is one of the strongest in the industry then an effective marketing and sales effort for your offering will be good for generating near term profits. If the market is not especially attractive and your enterprise is one of the weaker ones in the industry you should promote this offering only if it supports a more profitable part of your business for instance, if this segment completes a product line range or if it absorbs some of the overhead costs of a more profitable segment.
Otherwise, you should determine the most cost effective way to divest your enterprise of this offering. Having selected the direction most beneficial for the overall interests of the enterprise, the next step is to choose a strategy for the offering that will be most effective in the market.
These low costs should translate to profit margins that are higher than the industry average. Some of the conditions that should exist to support a cost leadership strategy include an on-going availability of operating capital, good process engineering skills, close management of labor, products designed for ease of manufacturing and low cost distribution.
The emphasis can be on brand image, proprietary technology, special features, superior service, a strong distributor network or other aspects that might be specific to your industry. This uniqueness should also translate to profit margins that are higher than the industry average.
In addition, some of the conditions that should exist to support a differentiation strategy include strong marketing abilities, effective product engineering, creative personnel, the ability to perform basic research and a good reputation.
It is based on the concept of serving a particular target in such an exceptional manner, that others cannot compete. Usually this means addressing a substantially smaller market segment than others in the industry, but because of minimal competition, profit margins can be very high.
Pricing Having defined the overall offering objective and selecting the generic strategy you must then decide on a variety of closely related operational strategies.
One of these is how you will price the offering.
A pricing strategy is mostly influenced by your requirement for net income and your objectives for long term market control. There are three basic strategies you can consider. In this case you can price your offering comparably to those of your competitors.
Promotion To sell an offering you must effectively promote and advertise it.‘PNG’s banking and financial sector has the lowest loan-to deposit ratio of any country in the Pacific.’ The ongoing low LTD rate in the institutions certainly decreases the effectiveness of what microfinance can do to help the poor.
The information for this article was derived from many sources, including Michael Porter’s book Competitive Advantage and the works of Philip timberdesignmag.comts addressed include ‘generic’ strategies and strategies for pricing, distribution, promotion, advertising and market segmentation.
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