Learning Objectives Chapter 8 Marketing Strategy Strategies Positioning

Learning Objectives Chapter 8: Marketing Strategy: Strategies, Positioning, and Marketing Objectives 1. Identify the six components in developing a marketing strategy and plan. 2. Define the terms marketing strategy, positioning, and marketing objective. 3. Explain the concept of segmented marketing strategies and describe the alternative strategies by market focus. 4. Describe the alternative marketing strategies by product life cycle (PLC) stage.

Learning Objectives Chapter 8: Marketing Strategy: Strategies, Positioning, and Marketing Objectives 5. Describe the alternative strategies by industry position. 6. Explain the concepts of relationship marketing and strategic alliances. 7. Identify the reasons that have made positioning essential in today’s business climate. 8. List and describe the steps required for effective positioning (the five Ds).

Learning Objectives Chapter 8: Marketing Strategy: Strategies, Positioning, and Marketing Objectives 9. List and describe the six different approaches to positioning. 10. Explain the benefits of having marketing objectives and list the four requirements for good marketing objectives.

Marketing Strategy The selection of a course of action from among several alternatives that involves specific customer groups, communication methods, distribution channels, and pricing structures. It is a combination of target markets and marketing mixes.

Target Market A target market is a market segment selected by a hospitality and travel organization for marketing attention. Market segmentation involves dividing customers into groups (market segments) with common characteristics.

Marketing Mix A marketing mix includes those controllable factors that have been chosen to satisfy customer needs. The eight controllable factors are product, price, place, promotion, packaging, programming, partnership, and people. These are also know as the 8 Ps.

Relationship Marketing and Strategic Alliances Relationship Marketing Placing an emphasis on building, maintaining, and enhancing long-term relationships with customers, suppliers, travel trade intermediaries, and perhaps even competitors. Strategic Alliances Special long-term marketing relationships formed between two or more hospitality and travel organizations, or between a hospitality and travel organization and one or more other types of organizations (e. g. , KLM and Northwest, STAR alliance).

Positioning is the development of a service and a marketing mix to occupy a specific place in the minds of customers within target markets.

Marketing Objective A marketing objective is a measurable goal that a hospitality or travel organization attempts to achieve for a target market within a specific time period, typically one year.

Segmented Marketing Strategies Approaches that recognized the differences among target markets by using individualized marketing mixes for each of the target markets selected by a hospitality or travel organization. Also known as a differentiated strategy. The three alternative segmented strategies are: 1. Single-target-market strategy 2. Concentrated marketing strategy 3. Full-coverage marketing strategy

Undifferentiated Marketing Strategy A strategy that overlooks segment differences and uses the same marketing mix for all target markets.

Alternative Strategies for Product Life Cycle Stages g Introduction Stage a. Rapid-skimming strategy (high price/high promotion). b. Slow-skimming strategy (high price/low promotion). c. Rapid-penetration strategy (low price/high promotion). d. Slow-penetration strategy (low price/low promotion).

Alternative Strategies for Product Life Cycle Stages g Growth Stage a. Improve service quality and add new service features and elements b. Pursue new target markets c. Use new channels of distribution d. Lower prices to attract more pricesensitive customers e. Shift some advertising emphasis away from building awareness to creating desire and action

Alternative Strategies for Product Life Cycle Stages g a. b. c. Maturity Stage Market-modification strategy Product-modification strategy Marketing-mix modification strategy g Decline Stage a. Reduce costs and milk the company b. Sell off or get out of the business

Alternative Strategies by Industry Position g a. b. c. Market Leaders Expand the size of the total market Protect market share Expand market share g Market Challengers a. Take on or attack the market leader

Alternative Strategies by Industry Position g Market Followers a. Shy away from any attacks on market leaders g Market Nichers a. Specialize in a particular market segment

Positioning is the development of a service and a marketing mix to occupy a specific place in the minds of customers within target markets.

Reasons for Increased Importance of Positioning 1. Perceptual processes of customers They screen out most information 2. Greater competition More organizations competing for share of mind 3. Growing volume of commercial messages Advertising and promotion clutter

Steps Required for Effective Positioning (the five Ds) g Documenting g Deciding g Differentiating g Designing g Delivering

The 5 Ds of Positioning g Documenting What benefits are the most important to your current and potential customers? g Deciding What image do you want your current and potential customers to have of your organization? g Differentiation Which competitors do you want to appear different from, and what are the factors that you will use to make your organization different from them?

The 5 Ds of Positioning g Designing How will you develop and communicate these differences? g Delivering How will you make good on what you’ve promised, and how do you make sure that you have “delivered? ”

Positioning Approaches: Six Major Alternatives g Specific product features g Benefits, problem solution, or needs g Specific usage occasions g User category g Against another “product” g “Product class” dissociation