A summary of the lectures of Strategic Marketing Management for Marketing management and marketing analytics at Tilburg University. This includes all the content discussed in the lectures, guest lectures, and web clips.
Introduction
To create a sustainable competitive advantage, the best marketing strategies are:
- Distinctive: different from competitors, not easy to copy
- Coherent: have lots of pieces that all fit together
- Dynamic: updated frequently
Strategic marketing decisions: long-term holistic decisions concerning the future directions for the
organization, not something you get rid of soon strategy: figuring out what to do
Tactical marketing decisions: short-term decisions to execute the strategic directions within the firm
execution: doing it
Formulation (strategy) Implementation (execution)
Goals Means Tactics Actions
Content Goal criteria and Target Detailed integrated Behaviours to
(decisions, levels identifying customers/segments, marketing program enact tactical
resource required required value decisions decisions
deployments, outcomes proposition(s), (realized
actions) timing, etc. resource
allocations)
Process Performance Strategic planning, Marketing mix Resource
(strategy review, situation market analysis, planning, budgeting, deployment,
making and assessment, participation in MSM, communication, organization
realization) goal-setting, etc. etc. alignment, etc. design,
performance
monitoring
Inputs (resources) content & process
Outputs (positional advantage & performance sales, loyalty, purchase intention, etc.
Environment (internal & external contingencies) plays a role in between the inputs and outputs.
Strategic social responsibility
The global population is exploding: in 2050 we will have 10 billion people on the planet. The issue is
that all these people will require living, education, food, healthcare, etc. On top of that, all these people
consume, pollute, etc. This results in global challenges. These global challenges are complex and
interdependent. The COVID crisis made things worse:
- Issues of inequality are further amplified (richest became richer, more poverty)
- Gender parity has been heavily influenced, set back to almost a century
- Inequality between countries is expected to rise for the first time in a generation
New concepts and paradigms are needed to address these challenges, also in business
sustainable development goals (SDG’s) as compass to develop these.
There is also attention on ESG (ecological, social, governance): what is a company doing beyond
creating value for shareholders to contribute to the ecological process, addressing social issues and
good governance. The purpose of the corporation has been debated throughout history, as well as its
contribution to society CSR
Types of State capitalism Shareholder capitalism Stakeholder
capitalism capitalism
Key stakeholder Government Company shareholders All stakeholders matter
equally
Key Government steers the The social responsibility Society’s goal is
characteristic economy, can intervene of business is to increase increase the well-being
when necessary its profits of people and the
planet
Implication for Business interests are Short-term profit Focus on long-term
companies subsidiary to state maximization as highest value creation and
interests good ESG measures
Advocated by Milton Friedman: Klaus Schwab: Davos
shareholder theory Manifesto
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,Redefining the purpose of corporations
- The Business Roundtable (2019) issued a statement on “The purpose of corporations”
From focus on shareholders to an inclusive approach to customers, employees, suppliers,
communities, and shareholders
- The redefined purpose represents a significant shift from BRT’s previous statements that the
purpose of the company is solely to maximize shareholder return
- New business concepts are required to create and lead purposeful businesses
Companies are increasingly also living up to this
A new strategy concept for purposeful business: “Creating Shared Value” is the next stage in how
companies professionalize CSR: if you want to embrace a more inclusive approach, you need to step
away from creating financial value on the short-term but you need to do this in conjunction with
creating social value and environmental value and do that for a variety of stakeholders.
- Share value strategies simultaneously create value for the business and for society
- Meeting social needs that expand opportunities (addressable defined market) for the business
- Scalable societal impact because shared value is self-sustaining
Creating shared value moves beyond philanthropy and corporate social responsibility. Philanthropy is
the most basic concept, what many companies do to make sure they don’t lose their license to
operate. Business is still to earn maximum returns for shareholders CSR goes beyond that but still
has a lot to do to protect the core of your business and protect your reputation CSV: create and
dive into a new field of opportunity (4 impact 4 profit type of business model)
Philanthropy Corporate Social Creating shared value (CSV)
Responsibility (CSR)
Donations to worthy social Compliance with ethical and Addressing societal needs and
causes community standards challenges through the
business itself:
Volunteering Good corporate citizenship - Finding new opportunities
“Sustainability” initiatives - Achieving competitive
differentiation
Mitigating risk and harm - Making a profit
Improving reputation and
trust
Next to traditional businesses, new types of entrepreneurs emerge aligned with the Value spectrum:
Right hand: traditional business: companies that put
financial value first and claim that.
Left hand: charities, foundations, NGO’s: not for
profit, create social/ecological value.
We see new players entering on this spectrum: social
enterprises: need profit to sustain but this is not the
goal
CSR is not only an obligation, it is a business
opportunity
What does this have to do with marketing marketing has a role in protecting the reputation of the
brand. A very important aspect of marketing is understanding consumers and customers. There is a
trend in wanting to put money in mor sustainable companies, as marketeer you need to implement this
in your marketing policy. On top of that there are new opportunities/markets in this segment.
Kramer, Mark and Marc Pfitzer (2016), “The Eco System of Shared Value”
Why is CSV increasingly a business imperative?
- Legitimacy: creating value “at the expense of” iso “in harmony with”
- Big societal issues are so complex that they require expertise and scalable business models of
private sector
5 key conditions for success in driving collective impact:
1. Common agenda (shared vision)
2. Shared measurement system
3. Mutually reinforcing activities
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, 4. Constant communication (quarterly meetings, annual forums)
5. Dedicated backbone support (separate/neutral/independent)
System leadership: help other in the coalition to understand how the health of the whole system
benefits each party (e.g., closed loop fund)
Why is it so difficult and why do so many businesses miss the opportunity?
- Legitimacy and importance of trust
- Competitive free riders
- Justification of investment
o Expertise required in both societal and business issues
o Long-term commitment needed
o Ring-fenced budgets required
Important: redefining leadership
Pless, Nicola, and Thomas Maak (2011), “Responsible leadership: pathways to the future”
Why “responsible” leadership?
- “To not be responsible is to not be a leader” (Waldman and Galvin, 2008)
- Corporate scandals
- Reforms needed (responsible global leadership)
- Despite “call for reform”, global economic crisis (consequence of irresponsible leadership?)
- Need for a multilevel response to deficiencies in existing leadership frameworks and theories
Key elements in responsible leadership
- Respect, honesty, responsibility, accountability, morality, trust, driven by ethical principles
- Compassion towards rest of society; social responsibility
- Multi stakeholder approach
Responsible leadership: responsible leaders build and cultivate sustainable relationships with
stakeholders to achieve mutually shared objectives based upon a vision of business as a force of good
for the many. So, “responsible” implies responsibilities towards the various stakeholders.
Edelman trust barometer: business is more trusted than governments in 18 of 27 countries.
Multidimensional value creation requires innovation in business-, operating models and the way
performance is measured and managed. It is equally important to clarify the positive and negative
impact of business decisions on all stakeholders. Frameworks are needed (like the purpose compass)
to enable operationalization.
ESG (environmental, social, governance).
companies who do this, their stock performs better.
- Something most companies report as part of their annual reports
- A score that a company gets, that significantly impacts investments
- Environmental
o Climate, sustainability, etc.
o For the whole supply chain
- Social
o Diversity of employees
o Human rights in local communities
o Consumer protection (and animal protection)
- Governance
o Management structure
o Employee compensation, employee relations, etc.
Sustainability, social responsibility, and strategic marketing
These ideas apply to every aspect of strategic marketing management:
- Brand and portfolio management: product sustainability, brand positioning and values, which
segments to serve, monopolies, etc.
- Innovation: launching new products, R&D decisions, supply chain innovations, etc.
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