Strategic Marketing Management

MKT-522
Submitted to:
Prof. Dr. Razia Begum
Department of Marketing
MBA (Evening) Program
University of Dhaka
Submitted by:
Name ID
Manas Kumar Das 41735008
Md Anwarul Kabir 41735017
Sefat Zaman Antora 41735019
Mohd. Zaed Ibrahim 41735022

Date of Submission
28th March, 2018
 Chapter 6
Market Targeting and strategic positioning
SUMMARY

The report is done to understand the Market Targeting and Strategic positioning.
Targeting:
Effective targeting and positioning strategies are critical in gaining and sustaining superior
business performance.
The marketing targeting decision identifies the people or organizations in a product-market toward
which an organization directs its positioning strategy initiatives. Selecting one or more promising
market target is very demanding management challenge.
Targeting and positioning strategies consist of …
 Identifying and analyzing the segments in a product-market.
 Deciding which segment to target
 Designing and implementing a positioning strategy for each target.

Marketing Targeting approaches fall into two major categories-

1. Segment Targeting when segment clearly defined
2. Targeting based on product differentiation

Several factors may influence the choice the targeting strategy…

 Stage of product-market maturity
 Extent of diversity in buyer value requirements
 Industries structure
 The firm capabilities and resources
 Opportunities for gaining competitive advantage.

Market targeting decision need to take into account the product-market life cycle stage. Four life
cycle stages illustrate the range of product-market structure which are
 Emerging
 Growing
 Mature
 Decline
  Emerging:
Risk & uncertainty are high in the emerging marketing stage because of the lack of
experience in the new market.
 Growth:
Targeting in growth stage in benefits from prior experience.
 Mature:
Targeting in mature markets often involves multiple targeting strategies by firms with
small markets shares.
 Declining:
Declining product market is actually fading away instead of experiencing a temporary
decline or cyclical changes.

Global Market:
Global targeting ranges from local adaption to global reach.
In selecting strategies for global markets, there are two primary options for consideration:
1. The advantages of global integration.
2. The advantages of local responsiveness

Global Integration:
The objectives is to identify market segments that span global markets and serve these
opportunities with positioning strategies.

Local Responsiveness:
The basis for global segmentation is not by country, other segmentation are often more important
such as climate, language group, media habits and income.

Positioning Strategy:
The positioning concept describes how management wants buyers to position the brand and is
based on targeted buyer’s value requirements.
Positioning may focus on entire company, a mix of products, a specific line of products, or a
particular brand, although positioning is often centered on the brand. Positioning initiatives are
closely linked to business to deliver superior value to its customers.

Developing the positioning strategy:

Developing the positioning strategy requires integrating the product strategy, value chain, and
price and promotion strategies to focus them on the market target. Shaping this bundle of strategies
marketing decision into an integrated set of initiatives is a major challenge for marketing decision
makers. Building on an understanding of the market target and the objectives to be accomplished
by the marketing program, the positioning strategies matches the firm’s capabilities to buyer’s
value preferences.
The factors that affect marketing program strategy include market target, completion, resources
constraints, management’s priorities and the stage of the product life cycle.

Determining positioning Effectiveness:

Central to the positioning decision is examining the relationship between the marketing effort and
market response. Positioning analysis is useful in estimating the market response as well as
evaluating competition and buyer preference. The analysis methods include testing
customer/competitor research, market testing and positioning models.
Some faulty positioning can subvert a company’s marketing strategy, such as-
 Under positioning:
When customer have only vague ideas about the company and its products and do not
perceive anything distinctive about them.
 Over positioning:
When customers have narrow an understanding of the company, product or brand.
 Confused Positioning:
 When frequent changes and contradictory messages confuse customers regarding the
positioning of the brand.
 Doubtful Positioning:
When the claims made for the product or brand are not regarded as credible by the
customer.

Positioning & Targeting Strategies:

Positioning strategies become particularly challenging when management decides to target several
segments. The objectives is to develop an effective positioning strategy for each targeted segment.
The use of a different brand for each targeted segment is one way of focusing a positioning
strategy.
Question: What factors are important in selecting a Market Target?

Answer:

Two important factors to consider when selecting a target market segment are the attractiveness of
the segment and the fit between the segment and the firm's objectives, resources, and capabilities.

Attractiveness of a Market Segment

The following are some examples of aspects that should be considered when evaluating the
attractiveness of a market segment:

 Size of the segment (number of customers and/or number of units

 Growth rate of the segment
 Competition in the segment
 Brand loyalty of existing customers in the segment
 Attainable market share given promotional budget and competitors' expenditures
 Required market share to break even
 Sales potential for the firm in the segment
 Expected profit margins in the segment

Suitability of Market Segments to the Firm

Market segments also should be evaluated according to how they fit the firm's objectives,
resources, and capabilities. Some aspects of fit include:

 Whether the firm can offer superior value to the customers in the segment
 The impact of serving the segment on the firm's image
 Access to distribution channels required to serve the segment
 The firm's resources vs. capital investment required to serve the segment
The better the firm's fit to a market segment and the more attractive the market segment, the greater
the profit potential to the firm.

Target Market Strategies

There are several different target-market strategies that may be followed. Targeting strategies
usually can be categorized as one of the following:
Single-segment: Strategy - also known as a concentrated strategy. One market segment (not the
entire market) is served with one marketing mix.

Selective specialization: This is a multiple-segment strategy, also known as a differentiated

strategy. Different marketing mixes are offered to different segments.
Product specialization: The firm specializes in a particular product and tailors it to different market
segments. Market specialization- the firm specializes in serving a particular market segment and
offers that segment an array of different products.

Full market coverage: The firm attempts to serve the entire market. This coverage can be achieved
by means of either a mass market strategy in which a single undifferentiated marketing mix is
offered to the entire market.

Question: Discuss the condition that might enable a new competitor to enter a new mature
product market?

Answer:

After the Introduction and Growth stages, a product passes into the Maturity stage. A mature
market is one in which the existing companies, products and customers are relatively stagnant.
Few new companies enter the market, and innovation takes place slowly. However, during the
Maturity stage, the primary focus for most companies will be maintaining their market share in the
face of a number of different challenges.

Challenges of the Maturity Stage

Sales Volumes Peak: After the steady increase in sales during the Growth stage, the market starts
to become saturated as there are fewer new customers.

Decreasing Market Share: Another characteristic of the Maturity stage is the large volume of
manufacturers who are all competing for a share of the market.

Profits Start to Decrease: While this stage may be when the market as a whole makes the most
profit, it is often the part of the product life cycle where a lot of manufacturers can start to see their
profits decrease.

Due to the following Benefits of the Maturity Stage, many new competitors want to entry a new
mature product market:

 Continued Reduction in Costs: Just as economies of scale in the Growth stage helped to
reduce costs, developments in production can lead to more efficient ways to manufacture
high volumes of a particular product, helping to lower costs even further.

 Increased Market Share through Differentiation: While the market may reach
saturation during the Maturity stage, manufacturers might be able to grow their market
share and increase profits in other ways.
Condition that might enable a new competitor to enter a new mature product market:

Clear Performance: A clear performance is necessary to enable product entry through product
substitution. Example: Such as though Bajaj is a very well-known reputed company in bike market
and also in maturity stage but now a days Suzuki enters into the market with the better
performance.

Price Advantage: Price Advantage must be present for enable a new competitor to enter a new
market. Example: Again if we see the bike market, Bajaj is in mature position, but in Bangladesh
in recent days Walton enter into the bike market with price advantage.

New High-Tech: New High Technology always attract consumer. Example: Such as Sony is the
most well-known and famous company in Television market. But with the new technology
Samsung enter into the Television market. And consumer also attracts the smart TV of Samsung.

New Software: New software is another weapon to enter a mature market. Though Rolex is the
most famous brand in the Wrist Watch market but now a days apple also enters into the watch
market with his apple watch enrich with many attractive software.

New Application: New application is also a condition that enables a new competitor to entry into
a mature product market. Example: Such as Samsung has the most share in the Handset market
but still Xiaomi enter into the market with some new application; eye detector, selfie flash, split
screen etc.

Question: Select a product and discuss how the size and composition of the marketing
program might require adjustment as they move through its life cycle.
Answer:
A product life cycle is the typical stages a product goes through during its lifetime. The product
life cycle is broken down into five different stages, which include the development, introduction,
growth, maturity and decline stages of the product. Coca-Cola is a great example of a product that
has had a very long product life cycle. Since being introduced in 1886, it has spent the majority of
its life in the maturity stage. Characteristics for each stage differ and in response to the different
needs of the product as it moves through its life cycle, the market program used during these stages
differ as well.

Development Stage
During the development stage, the Coca-Cola was still just an idea, in the process of being
manufactured or not yet for sale. In this stage, the marketing mix was in the planning phase, so
rather than implementing marketing strategies, the product producer was researching marketing
methods and planning on which efforts the company intends on using to launch the product. The
company brought awareness of the product to potential customers through marketing campaigns
and special promotions.
Introduction Stage
As the Coca-Cola hits the market, it enters the introduction stage of the product life cycle. Because
it is a new product that customers are not yet aware of, the product sales during the introduction
stage was generally low. At this time, marketing expenses were generally high because it required
a lot of effort to brought awareness to the product.

Growth Stage
As customers become aware of Coca-Cola and sales increased, the product entered into the growth
stage of the product life cycle. Marketing tactics during the growth stage requires branding that
differentiates the product from other products in the market. In this stage Coca-Cola introduced
Diet Cola to the market. Marketing the product involves showing customers how this product
benefits them over the products sold by the competition—also known as building a brand
preference. One way Coca-Cola does this is to make the product more accessible, ensuring that it is always there
to meet changing consumer needs.

Maturity Stage
As Coca-Cola gained over its competition, the product entered the maturity stage of the product
life cycle. The marketing mix during this stage involves efforts to build customer loyalty, typically
accomplished with special promotions and incentives to customers who switch from a competitor’s
brand. Since being introduced in 1886, it has spent the majority of its life in the maturity stage.

Decline Stage
Once a product market is over saturated, the product enters into the decline stage of the product
life cycle. This is the stage where the marketing mix and marketing efforts decline. As we
mentioned before that Coca-Cola is still in the maturity stage. Coca-Cola needs to generate loyalty
from customers, the company can retain customers during this stage, but does not attract new sales
from new customers. For the marketing mix that remains during the decline stage, the focus is
generally on reinforcing the brand image of the product to stay in a positive light in the eyes of the
product's loyal customers. Decline stage is described as the stage where company leaves making
the product because of lower sales and the reduction in profitability, indeed face the loss on that
particular product.

Question 11: Discuss the relationship between the positioning concept and positioning
strategy.
Answer:
Positioning may focus on entire company, a mix of products, a specific line of products, or a
particular brand, although positioning often centered on the brand.
Positioning Concept:
The positioning concept indicates management’s desired positioning of the product in the eyes and
minds of target buyers. It is a statement of what the product means guided by the vale requirements
of the buyers in the market target.
Positioning Strategy:
The positioning strategy is the combination of marketing program mix strategies used to portray
the positioning desired by the management to targeted buyers. The strategy includes the product,
supporting services, distribution channels, price, and promotion action taken by the organization.
Relationship between Positioning Concept and Positioning Strategy
The positioning concept indicates how the management wants buyers to perceive company’s
brand. Selecting the positioning concept is a key marketing and business strategy decision:
a) The first step is designing positioning strategy.
b) The position can be central to customers’ perceptions and choice decisions.
c) All the elements of the marketing program can potentially affect the position.
The position can be central to customer’s perception and choice decisions. Further, since all
elements of the marketing program can potentially affect the position, it is usually necessary to use
a positioning strategy as a focus for the development of the marketing program. A clear positioning
strategy can insure that the elements of the marketing program are consistent and supportive.
The positioning concept and positioning strategies are closely related to each other. Choosing the
positioning concept is an important first step in designing the positioning strategy. The positioning
concept of the brand is “the general meaning that is understood by the customer in terms of its
relevance to their needs and preferences.” The positioning strategy is the combination of marketing
mix actions that is intended to implement the desired positioning of the brand concept to achieve
a specific position with targeted buyers.
The first requirement of positioning concept is designing positioning strategy. On the other hand,
developing the positioning strategy requires integrating the product, value chain, price, and
promotion strategies to focus them on the market target. So both of the positioning concept and
positioning strategy is closely related to each other.
 PRAN

PRAN started its operation in 1980 as processors of fruit and vegetable in Bangladesh and in 1981
when PRAN and RFL merge together it becomes one of the biggest business groups in Bangladesh.
PRAN RFL is currently one of the most admired food & beverages brand among the millions of
people of Bangladesh and other 77 countries of the world where PRAN Products are regularly
being exported. PRAN RFL’s comparative advantage as an economy lies in agriculture. They
believe the way to economic prosperity is through agro-business. PRAN stands for “Program for
Rural Advancement Nationally” and RFL stands for Rangpur foundry limited. PRAN RFL is the
pioneer in Bangladesh to be involved in contract farming and procures raw material directly from
the farmers and processes through state of the art machinery at our several factories into
hygienically packed food and drinks products. The brand PRAN RFL has established itself in every
category of food and beverage and other industry and can boost a product range from Juices,
Carbonated Drinks, Confectionery, Snacks, and Spices, cloths and to even dairy products.

PRAN takes a comprehensive approach to all kinds of agro processed food products, considering
all of the ways to make their products hygienic and quality. This encompasses everything from
choosing quality materials to the use of storage facilities and careful monitoring of products using
electronic sorting.

MARKETING STRATEGY OF PRAN-RFL GROUP

PRAN-RFL is currently most well-known food and Beverage Company in Bangladesh. They are
now the market leader of food & beverage sector in the market position of Bangladesh .They
always try to maintain some product standard like HACCP, HALAL and ISO. Except that they are
very conscious about their consumers, investors, customers and all about stakeholders. As a market
leader they have some market strategy. PRAN-RFLs strategies are divided into 4 parts-

1. STRETEGIES FOR PRODUCT:

maintaining the international standard in food, beverage and plastic products.

fferent age of customers.

-lasting plastic products.

Changing products with the changing needs.

2. STRATEGIES FOR PRICE:

their product price cheaper than other local competitors.

3. STRATEGIES FOR PLACE:

according to the choice & needs of customers.

4. STRATEGIES FOR PROMOTION:

soring social & national events.

Providing discounts among dealers & customers.
Attracting young generation.
References:
1. Strategic Marketing.
David W. Cravens, Nigel F. Piercy
(9th Edition)

2. http://www.researchomatic.com/Maturity-Stage-Of-Coca-Cola-69100.html

3. http://smallbusiness.chron.com/disadvantage-entering-mature-market-economy-
76883.html

4. https://www.smartling.com/market-positioning-strategy/

5. Pran-RFL group a rising market giant of bangladesh, Ms. Tania Akter, senior lecturer,
Brac university

6. Service marketing overview of RFL export department, Dr. Md. tareque aziz, associate
professor brac business school.

7. Pran-RFL profile, http://www.rflbd.com/profile.php