Essentially, until the implementation process reaches a satisfactory level (e.g. in terms of accomplishing performance standards) a Marketing strategy remains a plan not an operational reality. This particular observation led Gummesson (1974) to conclude that the ability and strength to execute a decision is more crucial for success than even the underlying analysis.
A review of the pertinent literature is indicative of an undue bias toward formulation almost to the neglect of implementation (Noble, 1999; Noble and Mokwa, 1999; Piercy, 1989; Walker and Ruekert, 1987).
Bonoma and Crittenden (1988) attribute this literature imbalance to a long held, misguided assumption among both academics and practitioners that Marketing Strategy implementation inevitably supersedes formulation provided the plan displays analytical sophistication. Second, what empirical evidence there is overwhelmingly suggests that implementation in practice is fraught with difficulties and generally falls short of expectations (e.g. Nutt, 1983). This is neatly captured by Meldrum (1996, pp. 30), who states, “One of the concerns about marketing as a management discipline is the inability of organizations to put into practice the policies devised in its name”. It is interesting to note that poor implementation is a long outstanding concern first brought to light by early writers (e.g. Barksdale and Darden, 1971; Felton, 1959) with Churchman (1975) aptly labeling it “the implementation problem”.
How can we improve Marketing Strategy implementation?
A) Development and Support of effective internal as well as external communication patterns may well reduce barriers and reduce dysfunctionalities and conflicts.
B) Skilled and Competent Implementers (for example, sales-reps who can eventually justify relationship excellence standards).
C) Organizational Redesign (for example, modification of strategic orientation in parallel to adoption of customer-oriented Marketing infrastructures).
D) Design and implementation of innovative internal Marketing programs / practices, targeted at key groups in the company, alliance partner companies, and other influencers.
Tuesday, 24 January 2012
Monday, 23 January 2012
The Value Delivery Process
Marketing is the process of Value Exchange. Value actually represents the exchange of tangible goods, services, ideas, time and maybe other intangibles between buyers and sellers. In fact, the key to a successful exchange is that each party has some value desired by the other. This has got an impact on the entire Marketing Concepts' philosophy design and implementation.
Building and enhancing strong Buyer-Seller Business Relationships is a strong part - coeffiecient of the Value Delivery Process. Most pragmatically, the Value Delivery Process is a Strategic Marketing approach that differentiates a customer-oriented organization from the traditional brand making and selling.
The Value Delivery Process brakes into three distinct phases:
A) Choosing the value where Marketing Management does its own “homework marketing” before any product exists (e.g. market segmentation, targeting and positioning as the essence of the first phase of strategic marketing.
B) Providing the value where Marketing Management decide the marketing mix criteria (For example, Marketing tactics) that will provide a strong competitive and thus a differential advantage (see previous posts).
C) Communicating the value where Marketing Management decides on the actual implementation process - utilization of the Sales Force, Sales Promotion , Advertising and other integrated communication tools.
There is though a differentiated Marketing approach into Value creation and substantiation of a differential advantage and this has got an impact upon Vargo and Lusch's academic work. Drawing on Vargo and Lusch (2004) and their Service–Dominant logic, “value is the outcome of co-creation between suppliers and customers”. They even stated that the customer is always a co-producer who participates in value creation through co-production. However, because they considered production a concept that is not in accordance with an inherent service logic (Vargo, 2008), they later replaced this statement with the expression “customers are always co-creators of value” (Vargo and Lusch, 2008). Other academics such as Grönroos (2008) and Ravald, (2010) in recent academic publications argue the specific Service-Dominant logic approach and ask for roles clarification of the different actors who participate in value creation on the ground “that the knowledge on how value is created, by whom and for whom is scarce”.
Vargo et al., (2008, pp. 146) acknowledging the issue claimed, “The roles of producers and consumers in a Goods-Dominant logic are distinct, whereas they in a Service-Dominant logic perspective are not”. In a recent article on the Service-Dominant logic, Vargo et al., (2008, pp.147) address this important feature of research on value creation as they suggest “...each instance of value creation is unique to and can only be assessed from the perspective of an individual service system...”. In full accordance with a Service-Dominant logic view, value is not created and delivered by the supplier, but emerges during usage in the customer’s process of value creation (Grönroos, 2006, 2008; Ballantyne and Varey, 2006; Gummesson, 2007).
This very last remark highlights the significance of Knowledge Workers' (e.g. Sales-Reps) contribution into the effective implementation of Marketing Strategies.
Building and enhancing strong Buyer-Seller Business Relationships is a strong part - coeffiecient of the Value Delivery Process. Most pragmatically, the Value Delivery Process is a Strategic Marketing approach that differentiates a customer-oriented organization from the traditional brand making and selling.
The Value Delivery Process brakes into three distinct phases:
A) Choosing the value where Marketing Management does its own “homework marketing” before any product exists (e.g. market segmentation, targeting and positioning as the essence of the first phase of strategic marketing.
B) Providing the value where Marketing Management decide the marketing mix criteria (For example, Marketing tactics) that will provide a strong competitive and thus a differential advantage (see previous posts).
C) Communicating the value where Marketing Management decides on the actual implementation process - utilization of the Sales Force, Sales Promotion , Advertising and other integrated communication tools.
There is though a differentiated Marketing approach into Value creation and substantiation of a differential advantage and this has got an impact upon Vargo and Lusch's academic work. Drawing on Vargo and Lusch (2004) and their Service–Dominant logic, “value is the outcome of co-creation between suppliers and customers”. They even stated that the customer is always a co-producer who participates in value creation through co-production. However, because they considered production a concept that is not in accordance with an inherent service logic (Vargo, 2008), they later replaced this statement with the expression “customers are always co-creators of value” (Vargo and Lusch, 2008). Other academics such as Grönroos (2008) and Ravald, (2010) in recent academic publications argue the specific Service-Dominant logic approach and ask for roles clarification of the different actors who participate in value creation on the ground “that the knowledge on how value is created, by whom and for whom is scarce”.
Vargo et al., (2008, pp. 146) acknowledging the issue claimed, “The roles of producers and consumers in a Goods-Dominant logic are distinct, whereas they in a Service-Dominant logic perspective are not”. In a recent article on the Service-Dominant logic, Vargo et al., (2008, pp.147) address this important feature of research on value creation as they suggest “...each instance of value creation is unique to and can only be assessed from the perspective of an individual service system...”. In full accordance with a Service-Dominant logic view, value is not created and delivered by the supplier, but emerges during usage in the customer’s process of value creation (Grönroos, 2006, 2008; Ballantyne and Varey, 2006; Gummesson, 2007).
This very last remark highlights the significance of Knowledge Workers' (e.g. Sales-Reps) contribution into the effective implementation of Marketing Strategies.
Sunday, 22 January 2012
Saturday, 21 January 2012
Lambda: Marketing an “Ultra-Premium” Olive Oil
“Too many brands were claiming the extra virgin olive oil description but were not of special quality. I love olive oil and I wanted to do something more, to create and reinvent the way people view it,” says Giorgos Kolliopoulos who developed Lambda according to "The Olive Oil Times" through his luxury food and beverage company Speiron, based in Athens, Greece. Available since 2007, Lambda remains the priciest ultra premium labeled brand on the market, consistently maintaining benchmark qualities that rate better than extra virgin standards.
From a theoretical point of view, a brand is a name, term, design, symbol, or any other feature that identifies one seller’s good or service as distinct from those of other sellers. American Marketing Association
Clearly, a strategic brand perspective requires Marketing managers to be clear about what role brands play for the company in creating customer and share-holder value.
FOR BUYERS, BRANDS CAN:
1) Reduce customer search costs by identifying products quickly and accurately,
2) Reduce the buyer’s perceived risk by providing an assurance of quality and consistency (which may then be transferred to new products),
3) Reduce the social and psychological risks associated with owning and using the “wrong” product by providing psychological rewards for purchasing brands that symbolize status and prestige.
Marketing Science Institute Report No. 97-422, 1997
FOR SELLERS, BRANDS CAN FACILITATE:
1) Repeat purchases that enhance the company’s financial performance because the brand enables the customer to identify and re-identify the product compared to alternatives,
2) The introduction of new products, because the customer is familiar with the brand from previous buying experience,
3) Promotional effectiveness by providing a point of focus, premium pricing by creating a basic level of differentiation compared to competitors,
4) Market segmentation by communicating a coherent message to the target audience, telling them for whom the brand is intended and for whom it is not,
5) Brand loyalty, of particular importance in product categories where loyal buying is an important feature of buying behavior.
Marketing Science Institute Report No. 97-422, 1997
From a theoretical point of view, a brand is a name, term, design, symbol, or any other feature that identifies one seller’s good or service as distinct from those of other sellers. American Marketing Association
Clearly, a strategic brand perspective requires Marketing managers to be clear about what role brands play for the company in creating customer and share-holder value.
FOR BUYERS, BRANDS CAN:
1) Reduce customer search costs by identifying products quickly and accurately,
2) Reduce the buyer’s perceived risk by providing an assurance of quality and consistency (which may then be transferred to new products),
3) Reduce the social and psychological risks associated with owning and using the “wrong” product by providing psychological rewards for purchasing brands that symbolize status and prestige.
Marketing Science Institute Report No. 97-422, 1997
FOR SELLERS, BRANDS CAN FACILITATE:
1) Repeat purchases that enhance the company’s financial performance because the brand enables the customer to identify and re-identify the product compared to alternatives,
2) The introduction of new products, because the customer is familiar with the brand from previous buying experience,
3) Promotional effectiveness by providing a point of focus, premium pricing by creating a basic level of differentiation compared to competitors,
4) Market segmentation by communicating a coherent message to the target audience, telling them for whom the brand is intended and for whom it is not,
5) Brand loyalty, of particular importance in product categories where loyal buying is an important feature of buying behavior.
Marketing Science Institute Report No. 97-422, 1997
Friday, 20 January 2012
Defining Strategies and Interdepartmental Organizational Alignment
It is useful for the development of the discussion to share definitions on Strategies and Interdepartmental Organizational Alignment:
A strategy is therefore a fundamental pattern of present and planned objectives, resource deployments, and interactions of an organization with markets, competitors, and other environmental factors (Kerin et. al., 1990). At a rather similar pace Walker et. al.,(2003) contend that a strategy should specify:
1)What objectives to be accomplished,
2)Where exactly to focus (which industries and product-markets) and
3)How to allocate resources and activities to each product-market in meeting environmental opportunities and threats and gain a competitive advantage.
Walker et. al. (2003) further contemplate five major components of a well-developed strategy as critical in Marketing strategy implementation:
1) Scope reflecting to the breadth of corporate strategic domain (e.g. vision, mission). For example, corporate scope reflects on the number and type of served industries, available product lines, and market segments a firm competes or plans to enter.
2) Goals and Objectives. For example, performance oriented dimensions - Marketing Numerics.
3) Resource deployment in effectively and efficiently allocating financial and human resources.
4) Identification of a sustainable competitive advantage (see previous post).
5) Development of Interdepartmental Organizational Synergies.
Given the recasting of successful Marketing in terms of services and relationships excellence, and the key role played by service providers it becomes necessary to bring ideas from a number of disciplines (for example, Marketing, Operations and HRM together)– without successfully ‘aligning’ strategy and implementation, services and relational quality will be impaired and therefore potential for competitive advantage lost.
Labovitz and Rosansky (1997, pp.5) defined alignment “as both a noun and a verb – a state of being and a set of actions . . . alignment . . . refers to the integration of key systems and processes and responses to changes in the external environment”. Often the concept of alignment when used in business is referred to as strategic fit (Smaczny, 2001), strategic match (Mintzberg et al., 1998), or simply the interface between two things (van der Zee and De Jong, 1999). In fact, Beal and Yasai-Ardekani (2000, pp. 735) identified alignment as “moderation, mediation, profile deviation, gestalts, covariation, and matching”.
A strategy is therefore a fundamental pattern of present and planned objectives, resource deployments, and interactions of an organization with markets, competitors, and other environmental factors (Kerin et. al., 1990). At a rather similar pace Walker et. al.,(2003) contend that a strategy should specify:
1)What objectives to be accomplished,
2)Where exactly to focus (which industries and product-markets) and
3)How to allocate resources and activities to each product-market in meeting environmental opportunities and threats and gain a competitive advantage.
Walker et. al. (2003) further contemplate five major components of a well-developed strategy as critical in Marketing strategy implementation:
1) Scope reflecting to the breadth of corporate strategic domain (e.g. vision, mission). For example, corporate scope reflects on the number and type of served industries, available product lines, and market segments a firm competes or plans to enter.
2) Goals and Objectives. For example, performance oriented dimensions - Marketing Numerics.
3) Resource deployment in effectively and efficiently allocating financial and human resources.
4) Identification of a sustainable competitive advantage (see previous post).
5) Development of Interdepartmental Organizational Synergies.
Given the recasting of successful Marketing in terms of services and relationships excellence, and the key role played by service providers it becomes necessary to bring ideas from a number of disciplines (for example, Marketing, Operations and HRM together)– without successfully ‘aligning’ strategy and implementation, services and relational quality will be impaired and therefore potential for competitive advantage lost.
Labovitz and Rosansky (1997, pp.5) defined alignment “as both a noun and a verb – a state of being and a set of actions . . . alignment . . . refers to the integration of key systems and processes and responses to changes in the external environment”. Often the concept of alignment when used in business is referred to as strategic fit (Smaczny, 2001), strategic match (Mintzberg et al., 1998), or simply the interface between two things (van der Zee and De Jong, 1999). In fact, Beal and Yasai-Ardekani (2000, pp. 735) identified alignment as “moderation, mediation, profile deviation, gestalts, covariation, and matching”.
Thursday, 19 January 2012
Marketing strategies and objectives
A) Build Marketing Strategy
The Marketing objective in a Build Marketing strategy is to increase sales and market share. This is a rather aggresive, relatively expensive however dynamic Marketing business approach aiming at growth markets. In this sense, an organization that incorporates a Build Marketing strategy focuses at increasing sales and establish its competitive position position in the market (e.g. development of market share). A Build Marketing approach is also desirable in mature markets where there are exploitable competitive weaknesses and hence exploitable corporate strengths.
B) Hold Marketing Strategy
The Marketing objective in a Hold Marketing strategy is to maintain market share. This is the case of a market leader firm in a mature or declining market. An organization can also apply Hold marketing strategy in a growth market where the costs incurred by trying to build market share outweigh the benefits.
C) Harvest Marketing Strategy
The Marketing objective in a Harvest Marketing strategy is to maximise profits whilst sales and market share are falling. This is the case of a firm that has decided to reduce promotional budgets, rationalize product line and possibly increase prices in maximizing profit margins. Such a firm obviouly neeeds a loyal core customer base (e.g. see development of loyalty schemes) as well as better use of financial and human resources. Indeed, "no money to waste" may be the slogan of the firm. This is a Marketing strategy suitable for recession times.
D) Divest Marketing strategy
The Marketing objective in a Divest Marketing strategy is to drop or sell the product out of its entire product portfolio. There is obviously poor performance and inappropriate fit with the rest of the product family. It is hard to make such Marketing decisions but there is only one reality: Sales at a Profit Reality
The Marketing objective in a Build Marketing strategy is to increase sales and market share. This is a rather aggresive, relatively expensive however dynamic Marketing business approach aiming at growth markets. In this sense, an organization that incorporates a Build Marketing strategy focuses at increasing sales and establish its competitive position position in the market (e.g. development of market share). A Build Marketing approach is also desirable in mature markets where there are exploitable competitive weaknesses and hence exploitable corporate strengths.
B) Hold Marketing Strategy
The Marketing objective in a Hold Marketing strategy is to maintain market share. This is the case of a market leader firm in a mature or declining market. An organization can also apply Hold marketing strategy in a growth market where the costs incurred by trying to build market share outweigh the benefits.
C) Harvest Marketing Strategy
The Marketing objective in a Harvest Marketing strategy is to maximise profits whilst sales and market share are falling. This is the case of a firm that has decided to reduce promotional budgets, rationalize product line and possibly increase prices in maximizing profit margins. Such a firm obviouly neeeds a loyal core customer base (e.g. see development of loyalty schemes) as well as better use of financial and human resources. Indeed, "no money to waste" may be the slogan of the firm. This is a Marketing strategy suitable for recession times.
D) Divest Marketing strategy
The Marketing objective in a Divest Marketing strategy is to drop or sell the product out of its entire product portfolio. There is obviously poor performance and inappropriate fit with the rest of the product family. It is hard to make such Marketing decisions but there is only one reality: Sales at a Profit Reality
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