GRAHAM HOOLEY NIGEL F.

PIERCY BRIGETTE
NICOULAUD

Market-led strategic
management

Introduction
Marketing, centering on identifying
and satisfying customer
requirements at profit
In greyser terms, marketing
migrated from being functional
discipline to how business should be
run
More than paying lip service to
marketing
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DOYLE DISTINGUISHES
BETWEEN THE
FOLLOWING
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Radical strategies
Companies achieve spectacular
growth in sales and profits without
building customer value through
superior products
Acquisition based
Marketing department based (High level
of advertising, proliferating product
lines)
Public relations based (media hype to
attract customers)
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Rational strategies
High short term performance through
products cheaper than traditional
competitors
Major innovations in technology,
marketing methods or distribution
channels
Amstrad in electronics, and personal
computers (PCs), sock shop in specialty
retailing
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Robust strategies
Companies achieve steady
performance over long period by
creating superior customer value and
building long-term customer
relationships.
Superior customer value, long-term
investments in relations with suppliers,
distributors and offer long-term
advantage
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WEBSTER PROPOSES
MARKETING AS A SET OF
PROCESSES
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Value-defining processes
Processes that enable the
organization to understand its
environment in which it operates
better (understand resources and
capabilities)
Such as market research, buying
behavior, product use and so on

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Value developing processes

Processes that create value
throughout the value chain
Procurement strategy, vendor selection,
strategic partnership with service
providers etc.

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Value-delivery processes
Processes that enable the delivery of
value to customers
Service delivery, customer relationship
management, management of
distribution and logistics,
communication processes (such as
advertising and sales promotion) and
customer support services etc.

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THE MARKETING CONCEPT

AND MARKET
ORIENTATION
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Definition of marketing
Definition from Ferrell and Lucas
(1987):
Marketing is the process of planning
and executing the conception,
pricing, planning and distribution of
ideas, goods and services to create
exchanges that satisfy individual and
organizational objectives.
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Figure 1.1

Model of mutually beneficial exchanges

Providers
Providers
goals
goals
Survival
Survival
Financial
Financial
Social
Social
Spiritual
Spiritual

Offers
Services, products

customers &
providers satisfaction

Responses
Purchases, support

Customers
Customers
goals
goals
Solutions
Solutions
Benefits
Benefits
Well-being
Well-being

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Marketing concept
Marketing involves the following:
organisational culture: set of values and
beliefs for the organisation to serve
customers needs
strategy: develop effective responses to
changing market environments by
defining market segments, and
developing and positioning product
offerings for targets
tactics: concerned activities of product
management, pricing, distribution
and
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Market orientation
Philosophy of marketing into reality
Definition from Kohli and Jaworski
(1990):
Market orientation are activities toward
developing an understanding of
customers current and future needs.

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Components and context of

market orientation are
proposed:
Customer orientation
Understanding costumers to create superior
value

Competitor orientation
Awareness of the short-long term competitors
capabilities

Interfunctional co-ordination
Using all resources to create value for
customers

Organizational culture
Linking employee and managerial behavior to
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customer satisfaction

Figure 1.2

Components and context of market

orientation

Customer
orientation

Competitor
orientation

Market-led
organizational
culture

Interfunctio
nal
cordination

Focus on the
long term

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Resource based view of

marketing
Focus on core competencies
Performance is driven by the
resource profile of the organization
Possession and deployment of
distinctive, hard to imitate or
protected resources
Three alternative approaches are
apparent
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Product push marketing

Activities on existing products and
services and look for ways to
encourage, or persuade customers to
buy.
The key is to make customer want
what we are good at.

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Customer-led marketing
Under this approach organisations
chase their customers at all costs.
The retailers react by giving
customers more choice, heavy
promotions and deals to stimulate
purchases, and aggressive sales
force targets.
Customers get confused because of
the over complex promotions.
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Resource based marketing

Companies base their marketing
strategies on equal consideration of
the requirements of the market and
their abilities to serve it.
Resource based marketing seeks a
long term fit between the
requirements of the markets and the
abilities of the organisation to
compete in it.
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Figure 1.3

Marketing approaches
Market
Market needs
needs
Customer-led
Customer-led
marketing
marketing

Customer-led
Customer-led
marketing
marketing
Customer-led
Customer-led
marketing
marketing
Organizational
Organizational capabilities
capabilities
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Figure 1.4

Organizational stakeholders
Customer
s
Sharehold
rs

Distributo
rs
Focal
Organizat
ion

Managers

Suppliers

Employee
s
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Contribution of marketing to
stakeholders objectives
Firms that do well in marketplace
also do well financially
Adding value of firm for shareholders
Firm adopting market-oriented
culture perform better financially
than those that do not

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Figure 1.5

Marketing and performance outcomes

Marketing
Marketing
resources
resources

MarketMarketoriented
oriented
culture
culture

Assets
Assets

capabilit
capabilit
ies
ies

Market
Market
performance
performance

Custome
Custome
rr
satisfacti
satisfacti
on&&
on
loyalty
loyalty

Financial
Financial
performance
performance

Sales
Sales
volume
volume
market
&&market
share
share

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Marketing fundamentals
Set of basic and pragmatic marketing
principles that guide marketing
thought and action
Follow logic of value-based processes
described by webster
Their applications can revolutionize
how organizations respond to,
interact with, their customers
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Principle 1: Focus on the

customer
High degree of customer focus-But
not blind focus!
Market-led approach
What business are we in?
What business could we be in?
What business do we want to be in?
What must we do to get into or
consolidate in that business?
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Principle 2: Only compete in

markets where you can
establish a competitive
advantage
Choosing where to compete and
where to commit its resources
How attractive the market appears
Do we have the competencies and
skills to compete here?

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Principle 3: Customers do
not buy products
Customers do not buy products ,
they buy what the product can do for
them the problem it solves

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Principle 4: Marketing is too

important to leave to the
marketing department
(even if there still is one)
Marketing is everyones job in the
organisation

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Principle 5: Markets are

heterogeneous
Different customers, sub-markets
and segments; buy a car for cheap
transport from a to b or for
comfortable or save travel; different
benefits requirements

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Principle 6: Markets and

customers are constantly
changing

Markets are dynamic and products

have a limited life; need product and
service improvement; customer
expectations change
Two main processes of improvement;
innovation and changes in
technology (which is a continuous
process)
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Figure 1.6

Product and process improvement

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The role of marketing in

leading strategic
management

The role of marketing in the

organisation can be in a way shown
in figure 1.7. (that role is threefold)

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Figure 1.7

The role of marketing in the organization

Identify
Identify and
and communicate
communicate customer
customer wants
wants and
and
needs
throughout
the
organization
needs throughout the organization

Determine
Determine the
the competitive
competitive positioning
positioning to
to match
match
the
the needs
needs of
of the
the customers
customers with
with company
company
capabilities
capabilities

Marshal
Marshal all
all relevent
relevent organisational
organisational resources
resources to
to
deliver
customer
satisfaction
deliver customer satisfaction

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Identification of customer
requirements
Identity and communicate customers
want and need throughout the
organisation
Identify the requirements of
customers and communicate them
effectively; who the customers are
and what will give them satisfaction
or create customer delight
Customers expectations, wants and
need must be understood and
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Deciding on the competitive

positioning to be adopted
Which target markets or markets the
organisation will seek to serve
Two main set of factors;
First, how attractive the alternative
potential targets are
Second, how well the company can hope
to serve potential target relative to the
competition

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Implementing the marketing

strategy
Marshal all relevant organisational
resources to deliver customer
satisfaction
Implementing the marketing
strategy; no gaps between offer,
design, production and delivery;

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