Strategic Marketing Management
MSc Marketing Analytics
Tilburg University
,Lecture 1 Introduction
Marketing Strategy: “A thoughtful plan by a company to produce desired outcomes in the
marketplace vis-a-vis customers, channel members and competitors” (Kotler 2012 Handbook of
Marketing strategy). “[…] an organization’s integrated pattern of decision that specify its crucial
choices concerning products, markets, marketing activities and marketing resources in the creation,
communication, and/or delivery of products that offer value to customers in exchanges with the
organization and thereby enables the organization to achieve specific objectives.” (Varadarajan, 2010;
Morgan et al., 2019)
The best marketing strategies are distinctive, coherent and dynamic.
´ Distinctive (different from competitors; difficult to copy) ó similar characteristics or
opposite of
decisions as competing firms
´ Coherent (the different pieces fit together) ó set of (uncoordinated) tactics
´ Dynamic (frequently updated) ó poor implementation of activities
Examples:
´ Marketing strategy of Rolex is coherent in creating exclusive watches that are not available at
every watch store.
´ Marketing strategy of Apple is dynamic in the sense that, at times, they slightly update their
brand image. E.g., by creating ApplePay, which slightly differs from (but not too much that it
would not fit) the image of their slick, aesthetic products.
´ Harley Davidson is very dominant in the motorcycle market, especially in Amerika. They make
more money from merchandising than from selling actual motorcycles. They realized,
however, that the “Made-in-Amerika image” did not correspond with the image in other
geographical markets, such as in Europe. As a result, they altered their marketing strategy for
these markets by manufacturing their motorcycles in Asia rather than in Amerika.
Compulsory Paper 1. Strategic Marketing and Marketing Strategy: Domain, Definition,
Fundamental Issues and Foundational Premises (Varadarjan, 2010)
Strategic marketing decisions can be viewed as an organization’s decisions in the realm of marketing
that are of major consequence from the standpoint of its long-term performance (decisions that can
have a major impact on an organization’s long-term performance for better or worse – ranging from
positive impact to adverse impact on performance). An organization’s marketing decisions specify the
marketing actions, activities or behaviors to engage in (in the marketplace).
Strategic marketing decisions:
´ entail resource commitments that are either irreversible or relatively difficult to reverse
´ entail resource commitments that are relatively larger in magnitude
´ entail resource commitments that are made with a relatively longer-term outlook
´ entail resource commitments that are spread over a relatively longer time period
´ entail resource commitments that are made with a relatively greater emphasis on the
achievement of a competitive cost and/or differentiation strategy
´ entail tradeoffs (i.e., pursuing course of action A implying that courses of action B, C and D
must be foregone, in light of the relatively large resource outlays that purposing any of these
courses of action would entail)
´ are made in the context of other strategic decisions, in light of inter-dependencies between
them
´ are made at higher levels in an organization (e.g., the top management level) and/or at higher
levels withing the marketing function)
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,ó Tactical Marketing Decisions: e.g., promotion, advertisement. Easy to reverse.
Example 1: Setting up a loyalty program. Setting up a loyalty program is a long-term strategy. Before
actually setting up the program, the company needs to be aware of its brand image and how it
differentiates from competitive brand images. British Airways, e.g., mainly focuses on business
travelers in the upper class. Benefits of their loyalty program may include access to business lounges,
priority boarding, a dedicated contact number or free seat selection at booking. The loyalty program
of Ryanair, focusing primarily on free products or flights, would not appeal to upper class business
people (their flights are typically paid for by their company).
Example 2: Establish on strategic partnerships. When Apple released the Apple Pay app, the brand
effectively changed how people perform transactions. The app allows people to store their credit or
debit card data on their phone, so they can use them without physically having the card with them. In
order for the app to succeed, it needed credit card companies to integrate with this technology.
MasterCard became the first credit card to allow users to store their cards on Apple Pay. For
MasterCard, this is a coherent, long term, strategic decision. It reflects the modern and technology-
oriented character of the company that MasterCard wants to show to its customers.
Other Strategic Marketing Decisions
Launching of a new product Rationalizing a product line
Rebranding: changing your brands’ Expanding distribution coverage
position
Entering new product-market Initiating a major advertising campaign
combination
Introduce a loyalty program Divesting/withdrawing from the market
Catering to new market segments Install a social media campaign
Developing product leadership Establishing a supplier partnership
Promotional policy changes ...
Marketing Strategy consists of:
1. Strategic Marketing Decisions
(strategy)
2. Tactical Marketing Decisions
(execution): short term (annual
or quarterly) decisions to
execute the strategic directions
within the firm; filling in the
marketing mix of the individual
product or brand to realize the
company strategic goals. E.g.,
brand price level, advertising by
brand, sales force allocation.
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, Lecture 2 Strategic Social Responsibility I (Guest Lecture)
Introduction: how are we coping with the global challenges that we are currently facing (e.g., climate
change, inequality, poverty, hunger)? The UN Sustainable Development Goals (SDG) is the strategy
that the world defined to face those challenges. It consists of a set of goals that should be
accomplished by the end of 2030. What does this mean for the various actors of society (governments,
corporate enterprise)?
The country overshoot day is the day in the year where a country has reached its limits of consuming
their natural resources available for that year. Many countries arrive at this day early in the year. This
becomes an even bigger problem when looking at the accelerating growth rate of people on the planet
(2050: > 10 bn, +300%). If we continue to consume/live/pollute as we currently do, we will need the
resources of 3 more planets by 2050.
Global challenges are complex and interdependent. The COVID crisis is painfully clarifying the
underlying weakness of the society; it is translating more into an economic crisis. As a result of the
COVID crisis (1) the world’s ten richest men more than doubled their fortunes from $700 billion to
$1.5 trillion, (2) gender parity is set back from 99 years to 135 years (where we saw progress in closing
this disparity gap in recent years), and (3) inequality is expected to rise for the first time in a
generation. A very large number of resources has been freed up to combat the COVID crisis and
support the economy. We have been focusing all the effort on this crisis (short-term), but given the
fact that global challenges are complex and interdependent, one could argue that there are bigger
threats coming up, such as recession (large inflation), climate change, or even biodiversity collapse.
We need new concepts and paradigms such as the SDG to address these challenges, also in economics,
management and business.
The purpose of the corporation has been
debated throughout history, as well as its
contribution to society. Shareholder
capitalism argues that the social
responsibility of a company is to increase its
profits. With profits companies pay taxes and
with taxes governments invest in e.g., health
care and education. Stakeholder capitalism,
however, argues that companies should not
only focus on shareholders but on all
stakeholders (including society at large).
E.g.: Foxconn workers on iPhone 5 strike in
China as a result of working conditions and
high-pressure complaints.
Redefining the “purpose” of corporations: The Business Roundtable is an association of CEOs of
America’s leading companies that created a social network to speak on behalf of the businesses. In
2019, they issued a statement on the “the purpose of corporations” in which they clarified that they
shifted their focus from shareholders to an inclusive approach, including customers, employees,
suppliers, communities, and shareholders. The redefined purpose represents a significant shift from
the BRT’s previous statements, first authored in 1997, that the purpose of the company is solely to
maximize shareholder return. New business concepts are required to create and lead purposeful
businesses.
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