MARKETING STRATEGY
Articles & cases
SESSION 1 | CHANGES & SHARED VALUE
Reinventing Marketing to Manage the Environmental Imperative
Marketeers need to reexamine theory and practices because of finite resources and high
environmental costs
Marketing = activity, set of institutions and processes for creating, communicating, delivering, and
exchanging offerings that have value for consumers/clients/partners/society
Environmental challenges: climate change, depletion of ozone layer, soil degradation, air and water
pollution, reduction of fresh water, depletion of resources.
Assumptions of marketers in the past:
o Wants are natural and infinite, encouraging unlimited consumption is good
o The planet's resources are infinite
o Earth's capacity for waste and pollution is infinite
o Quality of life and happiness increase with consumption and want satisfaction
Sustainable principles: wants shaped by marketing, earth's resources are finite, waste capacity is
limited, quality of life does not always increase with more consumption
Unilever: double our business while reducing environmental impact and footprint
o When every company does this, sustainability is impossible
Marketing practices that need to change - four P's
o Product: materials, packaging, use of energy and supplies
o Price: according to environmental friendliness and extra costs
o Place: location production and distribution facilities
o Promotion: from print to online, communicate commitment to sustainability
Major pressure for changing marketing practices comes from consumers themselves
o Prefer to buy from companies that care
o People are willing to pay more for environmentally friendly products
o Less materialism
o Consumers are LOHAS: Lifestyles of health and sustainability
B2B companies feel less pressure
Demarketing: demand reduction - use 4 Ps in a reverse way
o No overfishing, energy waste, overeating, obesity and other issues
o Government and industries need to develop tools and skills to demand reduction
Social marketing: marketing an idea, cause or behavior
o Influencing more positive awareness and behavior through campaigns
o Stop smoking, say no to drugs, exercise more and eat healthier food
Research needed on several important issues
Creating shared value - How to reinvent capitalism and unleash a wave of innovation and growth
The capitalist system is under siege
CVS = creating shared value
Business viewed as cause of social, environmental and economic problems
o Companies trapped in outdated approach to value creating
o Solution lies in the principle of shared value
Shared value should be about sharing value created by firms: redistribution approach
o Buying fair trade cocoa raises income 10-20% vs. shared value investments 300%
, Shared value = policies and practices that enhance competitiveness of a company while
simultaneously advancing the economic and social conditions of their community
o Focus on identifying and expanding connection between societal and economic progress
Competitiveness of company and health of communities are closely intertwined
o Capitalist view: by making profit supporting employment, wages, purchases, etc.
Companies can create shared value by:
o Reconceiving products and markets
o Redefining productivity in value chain
Energy use, logistics, resource use, procurement, distribution, productivity, location
o Building supportive industry clusters at the company's locations
Enabling local cluster development
Success of every company is affected by supporting companies
Shared value blurs line between for-profit and nonprofit organizations
Creating shared value in practice
o Profits involving a social purpose represent a higher form of capitalism
o Shared value is more effective and sustainable than today's efforts
Shared value gives opportunity to utilize skills, resources and capabilities to lead social progress
SESSION 2 | GROWTH SHARE & BRAND RENEWAL MATIRX
Growth-share matrix
Growth-share matrix = chart created in collaborative effort by BCG employees
Purpose: helps to analyze business units (product lines), allocate resources, and used as analytical
tool in brand marketing, product management, strategic management and portfolio analysis
Scatter graph to rank business units based on relative market shares and growth rates
o Cash cows: high market share in slow-growing industry - 'milked' with little investment
o Dogs: low market share in mature slow-growing industry - break-even units
o Questions marks: low market share in high-growth market – often start point, have potential
o Stars: high market share in fast-growing industry - monopoly or dominant USP
Require high funding to fight competitors and maintain growth rate
Most units start as questions marks, turn into stars, become cash cows and end as dog
Growth opportunities when stars assure future, cash cows supply funds, ? converted into stars
Companies should have portfolio of products with different growth rates and market shares
Matrix offers map of product's strengths and weaknesses - likely cash flows
Relative market share: indicates likely cash generation - higher the share, the more cash
o Brand's share relative to its largest competitor
o Rule of 123: most stable position brand leader double share of 2nd and triple of 3rd brand
Market growth rate: rapidly growing markets require investment
o Higher growth rate is indicative of demands on investment
o Indicator or market's strengths, future potential and attractiveness to future competitors
Minority applicability problem: cashflow techniques only applicable to limited number of markets
Milking cash cows’ problem: not milk units to such an extent that their position is jeopardized
Balance between four quadrants is key
Achieving the Ideal Brand Portfolio - Brand renewal matrix
Brands need structured and straightforward approach for streamlining brands in effective portfolio
Portfolio planning: periodic, discrete event that looks across entire brand set
Framework for brand portfolio renewal
