Marketing Strategy: The Building Block of Success

We’ve all heard stories of the successful business built on a business plan written one evening on the back of an envelop.  For most companies, this level of marketing strategy would be a recipe for disaster.  Think of marketing strategy as your roadmap — would you plan your vacation without taking a map or GPS?  Would you build a home without building plans? Who knows what would happen.  Its the same way in planning your marketing strategy.

Where do I start building marketing strategy?

Your mission statement is the first place to start in generating a marketing plan.  Mission tells employees, customers, and other stakeholders what you are, what you do, and what you stand for.  In constructing a mission statement, you need long-term vision of where you want the company to be.

Marketing myopia is a term given to mission statements (and marketing strategies in general) that conceive of the business too narrowly.  A classic example of this [used by Theodore Levitt when he coined the term in 1960] was the oil industry, which conceived of itself as being in the petroleum industry rather than energy industry. Underlying marketing myopia is the notion that people buy solutions, so firms must construct their strategies around solving consumer problems not around products.

Where am I?

You really can’t figure out how to get somewhere without knowing where you are right now.  Its the same in building marketing strategy.  We call this snapshot of current conditions an environmental scan.  An environmental scan consists of understanding 5 factors impacting business success; consumers, competition, technology, the economy, and laws and regulations affecting the business.

Conducting an environmental scan involves market research into each of the 5 factors.  Much of this might be secondary research, including trade journals, statistical reports (such as the census), and online resources (such as Hoovers). Some elements of the environmental scan may require primary research, especially when trying to understand cultural elements salient in consumers.

Not only does an environmental scan tell you the state of the environment, it seeks to identify trends to help predict where the environment is headed.  For instance, plotting GDP over time would be more beneficial than stating current levels of GDP as the plot allows you to predict what GDP might be in the near future.

A marketing audit is also conducted (some sources use the term marketing audit to reflect both the internal evaluation and environmental scan).  A marketing audit is a means to understand where your company is right now.  It looks at current products and services, current marketing and advertising, your prices and distribution levels. brand equity, reputation, etc.

How do I put it all together?

Making sense of all this information is sometimes a daunting task.  A SWOT analysis helps bring a wide range of information into focus and begin the process of identifying actions to improve performance.  The acronym stands for strengths, weaknesses, opportunities, and threats.  A SWOT is an analysis tool that translates information so that competitive advantage comes into focus, dangers are highlighted, and opportunities are identified.  A SWOT analysis goes beyond restating information obtained from the scan, instead using this information to make strategic decisions.

Importantly, a SWOT analysis does not replace an environmental scan or marketing audit.

Where do I want to go?

From information and analysis, goals should be established.  Both short term goals (ie. the next 12 months) and long-term goals (the next 5 years) should be developed.  Obviously, long term goals will lack the specificity of short term goals, but both should contain a definitive goal (such as a 10% increase in sales for the short run and yearly increases of between 8% and 12% in the long run), they should have a time frame, such as within the next 6 months, and the goal should be realistic — goals that are too difficult to achieve or too easy encourage less performance than goals that are realistic and achievable.  Goals should also be consistent with the company mission statement.

What do I do now?

The next step in the process is to develop specific marketing strategies relative to the 4 P’s (product, price, promotion, and distribution) that allow you to reach your goals.  Marketing strategies should be specific, especially in the short run.  Each marketing strategy should also contain an action plan detailing who is responsible, what resources are needed, what outcomes might be expected, and contingencies.

Am I done now?

NO. Marketing plans require a budget (commonly build up from the action plans), measures of success (ie. what things do I measure to see if I’m making progress toward my goals), and contingency plans for how to handle problems that arise and when to consider an alternative course of action if I’m not making sufficient progress toward my goals with the current course of action.