Marketing Strategy: How It Fits with Business Strategy

Strategy is a way to plan for and control resources in a business in order to achieve
certain goals and objectives, and deliver its own mix of value, different from others. This
difference needs to be something that other consumers value. In summary, strategy is a plan that
helps a business gain a competitive advantage over other businesses focusing on the means to get
to that point. Strategies encompass the entirety of a business, from top to bottom and define the
success of an organization.
There is a process involved in the creation of a strategy, which is based on the mission
statement of the company. Using the mission as a base, management set goals which are used to
plan activities and measure progress. These goals should be informed by both the external
business and the market environment, and the internal competencies of the company. Goals are
then used to define tactics for implementation, and metrics are established in order to measure
performance.
Marketing helps businesses find out competitive threats, profitable opportunities, areas of
growth, maturity, and decline, customer needs, and ideas for distribution and pricing. This is
because every business function needs to be aligned with the higher-level strategy of the
organization, and thus they must take part in the strategic planning as well as providing plans and
tactics, at the corporate, business unit and product line levels. At the corporate level, marketing
communicates the overall message of the company to its customers. At the product line level,
marketers need to think tactically about how it needs to get customers to choose their offering.
The marketing strategy is also responsible for determining the target market of a
company or a product line, the positioning of that product, and the branding of the product in
relation to its positioning. This means having a strong understanding of external forces such as
demographics, market size, consumer perceptions of the product, and estimates of demand and
sales of the product.
The product life cycle is another concept closely related to marketing strategy. The marketplace
generally changes over time based on the age of a product. There are four phases in this life
cycle, which all present different challenges to marketers in terms of generating sales.
Typically, a product life cycle comprises of these four phases:
1. Introduction—the product takes on losses, and has few competitors especially in new
markets, and the main role of the marketer is to make customers aware of something that
is new and unfamiliar to them and educate them as to the benefits of the new product or
category.
2. Growth—some products will see exponential revenue growth, ending the period where
the company is taking on losses. However, the company may still not be profitable as
such immediately, as most of this revenue needs to go back into reinvestment for scaling
up operations, improving processes, and brand building. Brand building becomes the
main function of the marketer at this stage.
3. Maturity—growth slows to almost flat unit sales growth, and it turns into a buyer’s
market. There is heavy competition in this phase, which can lead to declining profit
margins. One of the techniques by which companies deal with this lowered growth rate is
by using product revitalization strategies. These include new technological features, for
example, built-in GPS in cars, or suggestions for new uses of old products. Marketing
needs to understand what features customers will value and pay for, and then plan out
how to communicate these new features to them. It is important however not to overvalue
 these differentiating features as often consumers pay less attention to them than marketers
do. Sometimes customers may prefer simpler choices.
4. Decline—this is when sales begin to fall because of various factors such as technological
obsolescence or changing behavior of consumers. Marketers may need to choose to
divest themselves of these products, find new markets for them, or find new uses for
them to gain as much profit as possible in the short-term.
The Product Life Cycle does not apply to every type of product however, it is a useful
framework for anticipating future challenges for a product as it moves through the lifecycle.

Building Your Company’s Vision

Successful companies are built by not compromising on core values and a core purpose,
which is guided by their vision. This allows them to innovate while maintaining a sense of
continuity. A properly thought-out vision has two major components, a core ideology and an
envisioned future. The core ideology defines why the company exists, and is unchanging, while
the envisioned future maps out the company’s aspirations, and inherently requires change and
progress.
A core ideology is an identity that remains the same regardless of product life cycles,
technology, environmental changes, or leadership changes. The world will continue to constantly
change, so having a core set of values or ethics is important as a guiding light for the company. A
core ideology must be authentic and come from the emotional core of the business, rather than
the intellectual. At the same time, the ideology need not inspire outsiders as long as employees
buy into it.
A core ideology comprises of two parts:
1. Core Values
These are essential tenets or guiding principles that do not require any further
justification because they inherently possess value to the organization. An example of this
is providing product excellence. There is no such thing as a “correct” set of core values
but a company needs to have them. Most companies do not have more than three or four
core values that remain unchanged even over long periods of time. The people in charge
of defining these core values thus need to be individuals with a high degree of credibility
in the company, who truly understand what lies at the heart of the company. However,
core values are distinct from strategies because these core values should not change, and
strategies must change constantly in response to internal and external factors.
2. Core Purpose
This gives the company a reason for existing, reflecting an idealistic motivation behind
the company. Rather than looking at output or customers, it tries to capture an intangible,
unreachable goal that continues to inspire the organization. Drilling down to the core
purpose requires asking why the company’s products are important and create value. By
doing this it also allows companies to bring more meaning into why they do things,
beyond the financials of the company.
Core ideologies should also not be confused with core-ideology statements, as the formalization
of a core ideology into words is not necessary for it to exist. Similarly, it should not be confused
with core competences, which are strategic in nature.
The envisioned future is the second part of this vision framework. It consists of a 10-30
year audacious goal, and a vivid description of what achieving that goal will be like. This BHAG
or Big Hairy Audacious Goal stimulates progress because it symbolizes a massive challenge for
the organization. It can serve as a tangible motivator for the company. A vision-level BHAG
requires years to complete and needs the company to think far beyond the company’s current
capabilities. There are four broad BHAG categories: target BHAGs, common-enemy BHAGs,
role-model BHAGS, and internal transformation BHAGs.
BHAGs need vivid description to help people visualize a future with that BHAG. This
tangibalizes the goal using emotions and conviction to inspire employees. However, BHAGS
should not be confused with the core purpose, as it is a clearly defined goal, while purposes are
not completeable by definition. Ultimately, a BHAG requires a lot of confidence and
commitment to achieve, but they are regardless achievable. Visionary companies tend to achieve
their BHAGs through building up their organization by trying a lot of things on the way.
One pitfall that needs to be avoided is “We’ve Arrived Syndrome” which happens when a
company achieves a BHAG but fails to replace it with another, which has happened with major
organizations such as NASA or Ford. This means the company loses momentum, and needs to
find another motivational spark.
Ultimately, the vision is based around one simple dynamic, which is protecting the core
of the business while continuing to progress, and this is done through an alignment of the
business through every level of the company, using the vision as a context. That is what
differentiates visionary companies from other companies.