Marketing strategy: why it is and how to develop it

Hello! In this article we will talk about an integral element of any modern enterprise - a marketing strategy.

Today you will learn:

• What is a marketing strategy;
• What levels and types of marketing strategies exist;
• How to create a marketing strategy for your business.

Content

• What is an enterprise marketing strategy
• The practical importance of marketing strategy for an enterprise
• Levels of an enterprise's marketing strategy
• Choosing the type of marketing strategy for your business
• Corporate level of marketing strategy
• Assortment strategy of the enterprise
• Market Orientation Strategies
• Business unit level
• Competitive strategies by type of competitive advantage
• Competitive strategies based on the organization's role in the market
• Product level of marketing strategy
• Positioning strategy
• Strategies for elements of the marketing mix
• Product marketing strategy
• Pricing Strategies
• Product distribution strategy
• Product promotion strategy
• Marketing Strategy Example

Structure and content of marketing strategy

Experts identify the following structure:

1. Analysis of target segments and market. This helps determine the relationship between the capabilities of the enterprise and the sales market. That is, the company, based on the results of the analytical review, must decide what services and products it will offer to customers in the niche.
2. Segmentation of clients by target groups. It is necessary to divide the total flow of potential buyers into small target segments to satisfy their demand. It is recommended to focus on the target group itself, following the Pareto rule: 20% of customers bring 80% of the company’s profit. This result indicates that the target segment has been identified correctly.
3. Positioning. A marketing development strategy involves a clear definition of your position in a niche. Occupying a leading position in a highly competitive niche is possible only if you have a valuable USP, competitive advantages and corporate identity.
4. Marketing package of measures. These are combined tools that help marketers promote products and services to the market. As a rule, complexes include: pricing policy, product strategy, promotion, distribution and sales policies.

What is an enterprise marketing strategy

Let us turn to the etymology of the word “strategy” . Translated from ancient Greek, it means “the art of a commander ,” his long-term plan of action in war.

The modern world dictates its terms, but strategy today remains an art that every entrepreneur must master in order to win the battle for profit and market share. Today, strategy is a long-term action plan aimed at achieving the global goals of the enterprise.

Any organization has a general strategy that corresponds to its global goals and strategy by type of activity. One of these is the marketing strategy of an enterprise.

Despite the fact that the number of companies in various markets is constantly growing, store shelves are crowded with a variety of goods, and consumers are becoming more and more whimsical and picky, many Russian companies still neglect marketing. Although it is the marketer who is able to highlight your product on the store shelf among competitors, make it special and bring profit. Therefore, developing a marketing strategy is one of the key issues in planning an organization’s activities.

Marketing strategy is a general plan for the development of each element of marketing (physical product - product, distribution, price, promotion; service - product, distribution, price, promotion, physical environment, process, personnel), developed for the long term.

The marketing strategy, as an official document, is enshrined in the company's marketing policy.

Formation and stages of strategy development

There are usually four stages in the formation and development of an enterprise’s marketing strategy:

• Analytics. Specialists examine market features, company capabilities and product characteristics. They also study the activities of competitors and the needs of the target audience in a specific niche. The analysis takes into account external and internal factors according to the SWOT model, where S – strengths (advantages) of the brand/product; W – weaknesses (disadvantages); O – capabilities/resources of the enterprise; T – external threats that cannot be influenced.
• Market selection. Having decided on the advantages and disadvantages, resources and USP of the company, you need to choose a sales market. That is, analyze supply and demand, determine the niche’s need for a product.
• Development of a marketing plan. At this stage, the company’s goals are clarified in the context of the research data obtained. Next, the pricing policy of the product on the market, positioning methods, objectives of advertising campaigns and other points are determined. As a result of all discussions and work, the company’s marketing plan is approved.
• Control. For each stage of strategy implementation, the results are analyzed, tasks are adjusted, and tools are adjusted.

The practical importance of marketing strategy for an enterprise

The marketing strategy, being an integral part of the overall strategy of the enterprise, directs activities to achieve the following strategic goals:

• Increasing the enterprise's market share in the market;
• Increasing the company's sales volume;
• Increasing the profit of the enterprise;
• Gaining leading positions in the market;
• Other.

The goals of the marketing strategy must be consistent with the mission of the enterprise and overall global goals. As we see, all goals are related to competitive or economic indicators. Achieving them without a marketing strategy is, if not impossible, then very difficult.

To achieve any of the above goals, it is necessary to include the following elements in the company’s marketing strategy:

• Target audience of your business/product . The more detailed you can describe your target customer, the better. If you have chosen several segments for yourself, then describe each of them, don’t be lazy.
• Marketing complex . If you offer a physical product, describe each of the four Ps (product, distribution, price, promotion). If you are selling a service, you will describe the 7 Ps (product, distribution, price, promotion, physical environment, process, people). Do this in as much detail as possible and for each element. Name the core benefit of your product, indicate the key value for the client. Describe the main distribution channels for each product, determine the price of the product, possible discounts and desired profit per unit. Think about what marketing activities will be involved in the promotion. If you offer a service, then determine who, how and where (in terms of room design, work tools) will implement it.

Each of the elements must also form its own strategy, which will be included in the overall marketing strategy of the business.

• Marketing budget . Now that you have a detailed marketing strategy, you can calculate your overall budget. It doesn't have to be exact, so it's important to include a reserve here.

Once you have identified each of the listed elements, you can begin to realize your goals through a series of tasks:

• Formulation of a strategic marketing problem (this point needs to be given the greatest attention);
• Needs analysis;
• Consumer market segmentation;
• Analysis of business threats and opportunities;
• Market competition analysis;
• Analysis of the strengths and weaknesses of the enterprise;
• Choice of strategy.

What mistakes are important to avoid?

Many factors influence the success of a marketing strategy. But there are three most common mistakes that can reduce all efforts to zero:

1. Application of templates . Each company has its own path - if something worked for one of them, it may not work for another. In each individual case, it is necessary to adapt the marketing strategy to current circumstances and make the necessary changes in a timely manner.
2. Focus on one channel . It’s better if your strategy covers as many promotion channels as possible (email newsletters, online and offline advertising, content marketing, etc.).
3. Lack of control . The success of a marketing strategy can only be measured by its results. If you do not monitor the consequences, you may not notice weaknesses and omissions. As a result, it will not be possible to improve the strategy and eliminate ineffective actions.

A good marketing strategy helps you choose a promising direction for business development, in which all resources work at full capacity and produce positive results.

Levels of an enterprise's marketing strategy

As we can see, the overall marketing strategy includes strategies for marketing elements. In addition, the marketing strategy must be developed at all strategic levels of the enterprise.

In the classical reading, there are four levels of enterprise strategies:

• Corporate strategy (if your company is differentiated, that is, it produces several products, otherwise this level will not exist);
• Business strategy – a strategy for each type of activity of an enterprise;
• Functional strategy – strategies for each functional unit of the enterprise (Production, marketing, R&D, and so on);
• Operational strategy – strategies for each structural unit of the company (workshop, sales floor, warehouse, and so on).

However, the marketing strategy will only cover three levels of the strategic hierarchy. Experts in the field of marketing recommend excluding the functional level, since it involves considering marketing as a narrowly functional type of activity. Today, this is not entirely true and leads to short-sighted decisions in the field of marketing.

So, marketing strategy must be considered from the point of view of three levels:

• Corporate level: formation of assortment marketing strategy and market orientation strategy;
• Business unit level: development of competitive marketing strategy;
• Product level: product positioning strategy on the market, strategies for the elements of the marketing mix, strategies for each product within the product line strategy.

As we can see, we should develop 6 types of strategies as part of the overall marketing strategy of the enterprise.

Product life cycle and marketing strategy

In strategic management, it is extremely important to consider the product life cycle and the product itself. The marketing strategy is developed taking into account the stage that the product is going through in a given period of time and. Let's take a closer look at the concept of the product life cycle.

The product life cycle refers to the period of time that a product goes through from the moment it appears on the market until the moment it disappears.

Scientists have different definitions of the stages that a product goes through throughout its entire life cycle, but most agree on four main ones:

• Origin (emergence).
• Growth (development).
• Maturity (saturation).
• Aging (decline).

Next, it is worth considering the characteristics that are inherent in a product at different stages of the life cycle and the features of strategic management that are used at each of them.

Corporate level of marketing strategy

At the corporate level, we need to consider assortment strategy and market orientation strategy.

Assortment strategy of the enterprise

Here we need to determine the number of product units of the assortment, the width of the assortment, that is, the number of products of different categories in the assortment (for example, yogurt, milk and kefir), the depth of the assortment range or the number of varieties of each category (raspberry yogurt, strawberry yogurt and peach yogurt).

As part of the assortment policy, the issue of product differentiation (changing its properties, including taste, packaging), developing a new product and discontinuing the product is also considered.

The listed issues are resolved based on the following information about the market and the company:

• Size and pace of market development;
• Size and development of the company's market share;
• Size and growth rates of various segments;
• The size and development of the enterprise's market share in the product market.

It is also necessary to analyze information about the products that are included in the product line:

• Trade turnover by product;
• Level and change in variable costs;
• Level and trends in gross profit;
• Level and change in fixed non-marketing costs.

Based on this information, the assortment strategy of the enterprise is drawn up.

Market Orientation Strategies

As part of this strategy, we need to identify the target market and identify target segments. Both questions depend on your range and individual products.

In general, at this stage the decision comes down to choosing one of the following market segmentation options:

• Concentration on one segment . In this case, the seller offers one product in one market.
• Market specialization . It is used when you have several product categories that you can offer only to one consumer segment. Let’s depict this schematically (“+” is a potential consumer)

• Product specialization is suitable for you if you have only one product, but at the same time you can offer it to several segments at once.

• Selective specialization . This is the case when you can adapt your offer to any of the segments. You have enough products to satisfy the needs of each segment.
• Mass marketing . You offer one universal product that, without any changes, can satisfy the needs of each segment of your market.

• Complete market coverage . You produce all products available on the market and, accordingly, are able to satisfy the needs of the entire consumer market

Before defining a market targeting strategy, we advise you to carefully analyze the needs of the customer segments that exist in your market. We also do not advise you to try to “capture” all segments at once with one product. So you risk being left with nothing.

Marketing strategies: types and groups

Marketing strategies can be classified according to several development criteria:

1. Concentrated growth. The sales market adapts to new products, or goods and services are modernized to fit the characteristics of the niche. Often, marketing is aimed at expanding the zones of influence of one brand product (horizontal increase in market share), as well as at competition.
2. Integrated growth. This is a type of vertical development marketing strategy. That is, it is not the market itself that is expanding, but the structure of the enterprise. It is based on the production of new types of goods or services, opening branches, cooperation with dealers and partners.
3. Diversified growth. This type is applicable when an enterprise has already exhausted resources to promote certain goods and services on the market. In this case, it makes sense to expand the assortment matrix by releasing new or modified/modernized old products.

Marketing strategy can also be divided into types based on market orientation. For example, companies concentrate on producing and selling one product in a niche or offer a choice of several product categories. There are companies that can cover the entire market with their products - full coverage or offer customers selective specialization by segment.

Marketing strategies may differ in the means that the company uses for promotion - product matrix, advertising campaigns, corporate identity, pricing.

How to choose a strategy by type? In practical terms, two perspectives need to be taken into account: competitive advantage (USP) and the company’s positioning in a niche. Let's consider several options for the first point:

• If a company produces a unique product that is valuable to the target audience, then it should choose a differentiation strategy. This type of marketing is more suitable for “old” companies that have a stable customer base, regular income and the ability to invest in the development of a unique product.
• If a company produces products with minimal costs for its production and sale on the market, it makes sense to focus on leadership in this aspect. This will allow you to take a leading position in pricing in the niche. Often, companies operating in the same region or city resort to this strategy. For example, free shipping is one of the tools for implementing a strategy of minimal costs. Enterprises with advanced equipment can reduce the cost of producing goods and, accordingly, bring products to the market at a reduced price.

Accordingly, these strategies can and should be mixed. For example, a company produces a group of products that have strong competitive advantages in a niche. At the same time, it has minimal production costs, which means it has the best prices on the market.

The company's marketing strategy also depends on positioning. For example, there are niche leaders - these are companies that create the main demand in the market. There is always fierce competition among them. The pursuers hit the weak points of the leader, trying to take away the share of buyers. A leader must constantly innovate in a niche to stay head and shoulders above the competition. In short, marketers in TOP 3-5 companies work tirelessly.

There are middle market players and niche players. The first and second are looking for low-competitive segments and conducting “guerrilla” marketing. Here companies need to be flexible and quickly adapt to changes. Otherwise, big players will crush small businesses.

Business unit level

Choosing a competitive marketing strategy is a fairly broad issue. Here it is necessary to consider several aspects at once, but first it is necessary to carry out analytical work.

First, assess the level of competition in the market. Secondly, determine your company's position among competitors.

It is also necessary to analyze the needs of your target audience, assess the threats and opportunities in the external environment, and identify the strengths and weaknesses of the company.

It is necessary to carry out analytical work with the product: identify its key value for the target consumer and determine its competitive advantage. Once you have done your analytical work, you can begin choosing a competitive strategy.

From the point of view of marketing practitioners, it is advisable to consider competitive strategies from two perspectives: the type of competitive advantage and the role of the organization in a competitive market.

Competitive strategies by type of competitive advantage

Here it would be advisable to immediately present these strategies in the form of a diagram, which is what we will do. The possible types of competitive advantage of the organization are located in the columns, and the strategic goal of the product (company) is located in the rows. At the intersection we get strategies that suit us.

A differentiation strategy requires you to make your product unique on the quality that matters most to your target customer.

This strategy is suitable for you if:

• The company or product is at a stage of its life cycle called maturity;
• You have a sufficiently large amount of funds to develop such a product;
• The distinctive property of a product constitutes its key value for the target audience;
• There is no price competition in the market.

The cost leadership strategy assumes that you have the ability to produce a product at the lowest cost on the market, which allows you to become a price leader.

This strategy is right for you if:

• You have technologies that allow you to minimize production costs;
• You can save money on production scale;
• You are lucky with your geographical location;
• You have privileges when purchasing/extracting raw materials;
• The market is dominated by price competition.

Focusing on costs and differentiation involves your advantage over competitors in only one segment of your choice, based on cost or product differentiation. The choice factors that we discussed above regarding each strategy will help you choose what exactly to focus on (costs or differentiation).

The focusing strategy has the following factors:

• You can identify a clearly defined segment in the market with specific needs;
• There is a low level of competition in this segment;
• You don't have enough resources to cover the entire market.

Competitive strategies based on the organization's role in the market

At the very beginning, we recalled that the concept of “strategy” entered our lives from the art of war. We invite you to return to those ancient times and take part in a real battle, only in our time and in a competitive market.

Before you go to the battlefield, you need to determine who you are in relation to your competitors: a leader, a follower of the leader, an industry average, a small niche player. Based on your competitive position, we will decide on a “military” strategy.

Market leaders need to stay on the defensive to avoid losing their position.

Defensive war involves:

• Staying ahead of competitors' actions;
• Constantly introducing innovations into the industry;
• Attack on oneself (own competing products);
• Always be on the alert and “jam” the decisive actions of competitors with the best solutions.

The leader's follower needs to take an offensive position.

First of all, you need:

• Identify the leader’s weaknesses and hit them:
• Concentrate your efforts on those product parameters that are a “weak” side for the leader’s product, but at the same time important for the target consumer.

For the average person in the industry, flank warfare is suitable.

It involves the following combat actions:

• Search for a low-competitive market/segment;
• Unexpected attack from the flank.

If you are a niche player , your war is guerrilla.

You should:

• Find a small segment that you can reach;
• Be active in this segment;
• Be “flexible”, that is, be ready at any time to move to another segment or leave the market, since the arrival of “large” players in your segment will “crush” you.

Aging stage

The last, final stage is characterized by a stable sales volume or its decline. The intensity of competition is also decreasing, as many manufacturers are leaving the market. Advertising costs are falling. A fundamentally new product may appear that will better satisfy consumer demand and a new company that operates more efficiently.

Marketing strategy and actions during the decline stage consist of the following stages:

• Use of merchandising tools.
• Stimulating sales department employees for effective sales.
• Stimulating sales with service.
• Liquidation of unprofitable strategic business units.

The main goal is to maintain production profitability, return the product to the previous stage, or exit the market.

The article presents the classic version of the life cycle, but it is not a pattern, but only a general concept that is most often observed in the market. Depending on the characteristics of the product itself, the selected market and the combination of many other factors, the product life cycle may have a completely different model, different sequence and duration of stages. A marketing strategy must be developed taking into account all these features in order to respond to market challenges in a timely manner and determine the most rational strategic actions.

Product level of marketing strategy

The marketing strategy of a product is represented by three types of strategies at once: a strategy for positioning the product on the market, strategies for the elements of the marketing mix, strategies for each product within the marketing strategy of the product line.

Positioning strategy

The positioning strategy of a company or product is based on some of your features. This could be the target audience you are targeting, a specific service process, or the use of a branded character in advertising. In general, when choosing a positioning strategy, it is important to identify your feature that will differentiate you from your competitors and will provide some value to your consumer.

We propose to highlight the following positioning strategies:

• Positioning on a special segment (for example, young mothers, athletes, clerks);
• Positioning on the functional features of the product . Functional features are mainly emphasized by companies specializing in high-tech products. For example , the iPhone, seeing the target audience’s need for excellent photo quality, positions itself as a smartphone with a camera no worse than a professional one;
• Positioning at a distance from competitors (the so-called “blue ocean”). There is such a positioning strategy as the “blue ocean” strategy. According to this strategy, the competitive market is a “red ocean”, where companies fight for every client. But an organization can create a “blue ocean,” that is, enter the market with a product that has no competitors. This product must be differentiated from competitors on key consumer factors. For example , Cirque du Soleil proposed a completely new circus format, which differed in price (it was much more expensive), did not have performances with animals and clowns, changed the format of the arena (there is no longer a round tent), and was aimed mainly at an adult audience. All this allowed Cirque du Soleil to leave the competitive market and “play by its own rules.”
• Positioning on a corporate character . There are quite a lot of such examples: Kwiki the rabbit from Nesquik, Donald McDonald from McDonald's, cowboy Wayne McLaren from Marlboro. True, sometimes a character also has a negative impact on the image of a company or product. So Wayne McLaren died of lung cancer and in the period of time from diagnosis to death he sued Marlboro, publicly telling how harmful their cigarettes were. Cartoons also sometimes cause harm. Thus, “Skeletons” from Danone were not popular among mothers due to the inflammatory images of cartoon characters used in advertising.
• Discoverer . If you were the first to offer a product, you can choose a pioneer strategy when positioning;
• Positioning based on a specific service process . This is especially true for the service sector. Everyone has already heard about the restaurant “In the Dark”. He will be a great example of this positioning.

Market segments

In a market segment analysis, you answer four questions:

• what segments are there in the market;
• what problems each segment solves;
• which segment is easiest for us to cover;
• what is the potential of each segment.

Next, you choose which segments to work with first.

I would like to note that it is difficult for some businesses to identify segments for two reasons.

The first is that you don’t know who makes the purchasing decision. A common case in B2B. Secondly, the buyer and the user are different people.

Communicating with clients is a must. If your situation is similar to the two cases described, then multiply “required” by ten.

Strategies for elements of the marketing mix

As part of the marketing mix strategy, there are four marketing mix strategies to consider.

Product marketing strategy

In addition to the assortment strategy, which we have already discussed, it is necessary to determine a strategy for each product unit. It will depend on the stage of the product life cycle.

The following stages of the life cycle are distinguished:

1. Implementation . The product has just appeared on the market, there are not many competitors, there is no profit, but sales volumes are quite high, as are costs. At this stage, our main goal is to inform the target audience. The actions should be as follows:

• Analysis of existing demand;
• Informing the target audience about the qualities of the product;
• Convincing the consumer of the high value of the product;
• Construction of a distribution system.

1. Height . You see rapid growth in sales, profits and competition, costs are falling. You need:

• Modify the product to avoid price competition;
• Expand the range to cover as many segments as possible;
• Optimize the distribution system;
• The promotion program should be aimed at stimulation, and not at informing, as it was before;
• Reducing prices and introducing additional services.

1. Maturity . Sales are growing, but slowly, profits are falling, and competition is growing rapidly. In this case, you can choose one of three strategies:

• A market modification strategy that involves entering new geographic markets. In addition, as part of this strategy, it is necessary to activate promotion tools and change the positioning of the product.
• The product modification strategy involves improving the quality of the product, changing the design and adding additional features.
• Strategy for modifying the marketing mix. In this case, we have to work with the price, it needs to be reduced, promotion, it needs to be intensified, and the distribution system, the costs of which need to be reduced.

1. Recession . Sales, profits, promotional costs and competition are reduced. Here, the so-called “harvest” strategy is suitable for you, that is, the gradual cessation of production of the product.

Pricing Strategies

There are pricing strategies for new enterprises and “old-timers” of the market.

Pricing Strategies for New Businesses

• Market penetration. Relevant if there is sufficiently elastic demand in the market. It consists in setting the lowest possible price for the product.
• Strategy of functional discounts for sales participants. If we want large chains to promote our product, we need to give them a discount. Suitable for large companies.
• Standard pricing. Nothing special. The price is calculated as the sum of costs and profits.
• Following the market involves setting the same prices as competitors. Suitable for you if there is no fierce price competition in the market.
• A price integration strategy is applicable when you can agree to maintain price levels at a certain level with other market participants.
• A strategy for balancing the quality and price of a product. Here you need to determine what you will focus on: price or quality. Based on this, either minimize costs (lower the price) or improve the quality of the product (raise the price). The first option is acceptable for elastic demand.

Pricing strategies for market watchdogs

• Open competition on price. If you are ready to reduce the price to the last player on the market, then this strategy is for you. Don't forget to estimate the elasticity of demand, it should be high.
• Refusal of "price transparency". In this case, you need to make it impossible for consumers to compare your price with your competitors' prices. For example, make a non-standard volume of product, for example, not 1 liter of milk, but 850 ml. and set the price a little lower, but so that your liter of milk is actually more expensive. The consumer will not notice the trick.
• Strategy for offering a package of goods. The strategy of offering a package of goods is to provide the consumer with the opportunity to purchase a “set of products” at a better price than if they were purchased separately. For example, in the McDonald's restaurant chain, such a package of products is a Happy Meal for children. When purchasing it, the consumer receives a toy at a reduced price, and the company receives an increase in sales.
• Stepped pricing strategy for the offered assortment. Break down the entire assortment into price segments. This will allow you to cover a larger portion of the market.
• Price linking strategy. We all remember the “makeweight” that was attached to scarce goods. This is a great example of this strategy.
• Price differentiation strategy. If your core product needs complementary products, then this strategy is for you. Set the price low for the main product and high for the complementary product. After purchasing the main product, the consumer will be forced to purchase a complementary one. A good example is a capsule coffee machine and coffee capsules.
• Introduction of free services. This strategy is similar to the strategy of abandoning price transparency. In this case, the consumer will also not be able to compare your prices with those of your competitors.

The next step in determining a pricing strategy is to determine a price differentiation (or discrimination) strategy; their use is not mandatory for the company.

There are two price differentiation strategies:

• Geographical price differentiation strategy . It is divided into zonal price, uniform price, selling price, basis point price and manufacturer's delivery cost strategies.

If your company has a presence in multiple areas (multiple geographic markets), then use a zone pricing strategy. It involves charging different prices for the same product in different geographic regions. The price may depend on the average salary in the region, differences in delivery costs, and so on.

If you set the same prices for products in all regions, then your strategy is a single price strategy.

The selling price strategy is used if you do not want to transport the goods at your own expense to the consumer (point of sale). In this case, the consumer bears the cost of delivery.

The price of a basis point involves fixing a certain point, from which the cost of delivery will be calculated, regardless of the actual location of shipment.

The manufacturer's shipping cost strategy speaks for itself. The manufacturer does not include the cost of delivery of the goods in the price.

• Price differentiation strategy for sales promotion . Suitable for you if the product is at the maturity stage of its life cycle. There are several other strategies that can be highlighted here.

“Bait Price” strategy. If you have a sufficient number of products in your assortment, you can apply this strategy. It consists of setting prices much lower than market prices for one particular product. The rest of the goods are offered at the average market price or above the average price. The strategy is especially suitable for retail stores.

Pricing strategy for special events – promotions, discounts, gifts. We won't stop here. Let's just say that there are discounts for timely payment of goods in cash (wholesale), discounts for volume, discounts for dealers, seasonal discounts (if you sell seasonal goods, you need to stimulate sales during the off-season).

Product distribution strategy

As part of the distribution strategy, it is necessary to determine the type of distribution channel and the intensity of the distribution channel. Let's deal with everything in order.

Distribution channel type

There are three types of distribution channels:

• Direct channel – movement of goods without intermediaries. Used when a company offers high-tech or exclusive products to a small segment.
• A short channel involving a retail trader. In this case, an intermediary appears who will sell your product to the end consumer. Suitable for small companies.
• A long channel involving a wholesaler(s) and a retailer. If you have a high production volume, then this channel will provide you with a sufficient number of outlets.

Distribution Channel Intensity

The intensity of the distribution channel depends on the product and production volume.

There are three types of distribution intensity:

• Intensive distribution. If you own a large production facility and offer a mass product, then this strategy is for you. It assumes the maximum number of retail outlets.
• Selective distribution. Selection of retail traders based on any criteria. Suitable for those who offer a premium, specific product.
• Exclusive distribution. Careful selection of traders or independent distribution of products. If you offer an exclusive or high-tech product, you should choose this type.

Having considered these elements, we will obtain a product distribution strategy that will be part of the company's overall marketing strategy.

Product promotion strategy

There are two main promotion strategies:

• Pull promotion involves stimulating demand in the market by the manufacturer independently, without the help of distributors. In this case, the consumer himself must ask the distributors for your product. This can be done using promotion tools (advertising, PR, sales promotion, personal selling, direct marketing). In this case, the promotion strategy must specify all the tools used and the timing of their use;
• Push promotion. In this case, you must make it profitable for distributors to sell your product. You must “force” him to promote your product. This can be done through discounts for sales representatives.

At first glance, choosing a marketing strategy seems to be a very labor-intensive and lengthy process. However, after going through all the described stages of defining a marketing strategy for each level of the strategic pyramid, you will understand that it is not so difficult. Let us give you an example to prove our words.

Types of Marketing Strategies

It seems advisable to accept the classification of types of marketing strategies proposed by T. A. Gaidaenko [1]:

— target market strategies;

— product strategies;

— pricing strategies;

— distribution strategies;

— communication strategies.

Target Market Strategies

This group of strategies is based on a differentiated approach.

It means that, based on the results of market segmentation, a company can either concentrate on one segment, considering it a target, or cover the entire market, but for each segment offer a program created specifically for it.

Rice. 1.4.1. Main stages of development and implementation of a marketing strategy [2]

An example of the use of just such tactics is the activity in modern car markets of companies - car manufacturers Toyota, Ford, etc. Automakers claim that they produce passenger cars for each market segment (vip, mid-price segment, etc.). The differentiated marketing strategy allows them to implement pricing, distribution and communication policies adapted to the needs and incomes of specific consumer groups - in relation to each of the segments served (for example, for VIP clients there is a very wide range of interior trims, additional equipment, a wide range of paint colors, This is why marketing policy supports such diversity). Undoubtedly, this leads to increased costs, as automakers lose the benefits of economies of scale. However, a differentiated approach (as opposed to an undifferentiated one, i.e., when ignoring differences between segments) allows us to provide a differentiated offer that meets the requirements of adequacy, accessibility, compliance, etc., subjecting it to the customization process.

Many companies combine their target market strategies with their core market strategies.

Basic Target Market Strategies

Basic strategies, as defined by M. Porter, in existing markets are as follows:

— overall cost leadership;

— differentiation;

— focused differentiation;

— focused cost leadership [3].

According to the definition of J.-J. Lambin, among the strategies for covering the base market, it is right to highlight the following strategies:

— concentrations;

— functional specialization;

— specialization according to the client;

— full market coverage;

— mixed strategy[4].

Decisions on the strategy to cover the base market are made based on an analysis of the “attractiveness/competitiveness” of different product markets. A company can avoid different outreach strategies:

— Concentration strategy. Market boundaries are defined narrowly by functions, technologies, and consumer groups. This is the strategy of a specialized company seeking to capture a large market share in a narrow niche.

— Strategy of functional specialization. The company performs one or more functions, but covers a wide range of consumers. Market boundaries are defined narrowly by function and broadly by consumer group. This category includes enterprises producing components and components.

— Client specialization strategy. Market boundaries are defined broadly by function and narrowly by consumer group. In this option, the company focuses on the needs of a specific group of customers.

— Strategy for full market coverage. Market boundaries are defined broadly by both functions and consumer groups. This covers the entire market. An example is a steel company.

— Mixed strategy. The company diversifies its activities: it offers different functions and serves different groups of consumers (for example, Russian tour operators operate in this way, offering a variety of packages for tourists - outbound, local tourism).

Product strategies

In market conditions, companies independently make decisions regarding the implementation of product policy, taking into account their internal capabilities and external conditions, providing an attractive product offer. Each business structure can offer to the market one type of product or service, or several product lines. The set of such lines represents the product range or product mix of the company[5].

In Fig. 1.4.2 presents the product strategies of a modern company, applicable to almost any industry and sphere of the economy.

Rice. 1.4.2. Product strategies of a modern company [6]

Product strategies are implemented by all companies - both producers of goods (the traditional definition of a product is a tangible or intangible good sold on the market) and organizations providing services (a good that is not material and is characterized by the properties of intangibility, inconsistent quality, high dependence on the competence of personnel providing services, etc.).

When developing and implementing product strategies, various product characteristics must be taken into account:

— general concept of the product;

— components of the product (form of presentation);

— product functions and characteristics;

— sensory unity (taste, tactile perception, smell, sound, appearance);

— packaging that makes up its physical shell;

— overall quality of the offer;

— related products (tips for use, information about the product, warranty service, etc.);

- a brand that carries certain values ​​and has a symbolic meaning.

In a company focusing on additional success in the market, the overall product strategy should be planned along three strategic directions:

— innovation;

- variations;

- elimination.

The product innovation strategy forms the basis of the new product development and introduction program. At the same time, the expression “new product” has different interpretations and is used both to denote an improvement, update of existing goods and services, and to characterize completely new goods or services that are provided to consumers for the first time. When developing a program for creating new products, it is important to correctly assess the significance and purpose of the innovation, since their quality and assessment of the risk associated with the introduction of a new product depend on this.

It is possible to ensure the implementation of an innovation strategy through product development strategies that J.-J. Lamben defines it as an increase in sales volume, for which improved or completely new products are developed for existing markets[7].

There are several possible approaches to ensuring innovation and implementing an innovation strategy.

1. Discontinuous innovation: the release of a new product or service that represents a significant change in the benefits offered and requires different behavior from users. Consumers must give up old habits and find a place for new products in their lives. (Examples: laptops, bank cards, etc.)

2. Feature Addition Strategy: Adding new features to existing products to expand the market. For example:

- increasing the versatility of a product due to its new capabilities (mobile phones that have many functions, and their number is expanding);

- giving emotional or social value to a utilitarian product (appliqués and other decorations on baby diapers);

— increasing the safety or convenience of a product (for example, electric kettles that automatically turn off when boiling).

3. Product Line Expansion Strategy: Increasing the breadth of the product line by introducing new product lines to increase or maintain market share. Examples:

— release of goods in different packages of different sizes;

— release of goods of other classes under the same umbrella brand;

- adding new tastes, aromas, colors or ingredients;

- offering new forms of the same product (for example, sports shoes with improved qualities from well-known manufacturers).

4. Product line renewal strategy: restoring the competitiveness of outdated or non-compliant products by replacing them with technologically or functionally more advanced products. Examples:

— development of a new generation of more advanced products (continuously improved televisions and home theaters);

— release of new, environmentally friendly models of existing products;

— improving the aesthetic qualities of the product.

5. Product quality improvement strategy: positive changes in the performance of a product or service as a benefit package. Examples:

— determination of the package of benefits demanded by each group of consumers (for example, benefits for target tourist groups consisting of students, parents with children, etc.);

— the formation of a set of services that complement each other, due to which their new quality appears (in particular, the provision of financial services by cardholders via the Internet, which fundamentally changes the strategy for servicing such clients).

A product variation strategy is a strategy for changing the product life cycle and maintaining sales volume. Typically, it is used when the growth in sales of a product is approaching the maturity or saturation stage.

To maintain sales, modification of existing products is used, which stabilizes sales and often contributes to an increase in sales and profits.

Product modification is a frequently used form of product policy activation. It is one of the strategies for increasing the duration of the maturity stage of a product in its life cycle. Along with market modification and marketing means modification strategies, a product modification strategy is aimed at expanding the scope of existing products and attracting new customers.

A variation can be aimed at transforming one of the product characteristics, such as:

— functional properties;

— physical properties;

— product design;

— image;

- name, brand of product.

In other options, a company may change several characteristics at once to achieve greater effect.

Product variation is associated with a strategy for increasing the concentration of utility of the consumer effect from using an existing product for a specific purpose. From the manufacturer’s point of view, variation contributes to the formation of an optimal balance between costs, the effect of using the product and buyer behavior.

The purpose of variation is not a radical change in the existing production program, but rather a relatively minor adjustment. Thus, the introduction of novelty into the representativeness of the product is intended to strengthen the existing trust of the buyer as a supporter of the product brand and this company.

Variation of a product by improving its properties makes it more unified, comprehensive and convenient. Thanks to product variation, a company can develop its image and create the image of an innovative company, which allows it to expand the scope of its activities in the market and conquer segments in new markets. Variation of a product also increases its attractiveness and makes it stand out due to the uniqueness and prestige of its external design.

The product elimination strategy includes two strategies:

— specializations;

- changes in product qualities.

Objective reasons for the decline in product sales are its aging, changes in consumer tastes and increased competition in the product market. Eliminating these causes usually requires significant costs. If a company fails to stabilize the position of its product offering on the market, then it can resort to a product elimination strategy.

The objective of the product elimination strategy is to identify those products that look dubious from the point of view of further attractiveness on the market and are subject to change. The results of inspection of such goods provide the basis for making decisions regarding the future fate of specific goods: keep them in the product range or discontinue production and withdraw them from the market. When preparing decisions, it is advisable to analyze the position of each product on the market.

The elimination strategy does not mean a clear decision to leave the market or close production altogether. The following solutions are possible: identifying “aging” products; development of measures for the functioning of the company in the conditions of the recession stage; withdrawal of product(s) from the range and continuation of activities with the remaining assortment; withdrawal of goods from the market. When choosing a strategic decision, it is taken into account that production requires an in-depth study of the current situation, for which data from accounting and control of production and commercial indicators and strategic analysis of the possible situation on the market can be used.

An example of the use of an elimination strategy is the activity of the Absolut Investment Group in the production of mozzarella cheese in one of the agricultural complexes near Moscow - Shchapovo. When purchasing this agricultural enterprise in 2007, the management of the Absolut group did not close the outdated cheese plant, the products of which were clearly unprofitable, but carried out its reconstruction. More than 200 thousand dollars were invested in this. The plant began to specialize in the production of mozzarella cheese. This cheese is readily purchased by Moscow chain stores - from Auchan to Seventh Continent. Mozzarella from Shchapovo is of good quality, and it is 20% cheaper than imported one. In 2010, the reconstructed plant received a profit of $1 million from its sale[8].

Thus, product strategies are highly diversified. When choosing one or another of them, as a rule, management decisions are made: increasing investments to strengthen positions in the market; localization of investments until the economic situation in the industry is certain; transfer of investments from less profitable markets to profitable niches, etc. To identify questionable and “aging” products, groups can be created to analyze the profitability of the product and market trends. After the analysis, rating tabular forms are compiled for each product, indicating possible sales volumes and profits. The company's management studies this information and makes one or another decision.

Pricing Strategies

Pricing is a critical element of marketing.

The price is designed to support the correct development and implementation of the company's overall strategy. When selling products at a set price that suits the consumer, she will be successful in her business. The price acts as an indicator of the implementation of the most important results of the activities of a business structure; it determines the effectiveness of these activities[9].

The company develops its pricing strategies (by groups of goods and services, or their individual types) in several stages:

1. Establishing pricing goals (maximizing profits, increasing market share, dumping, etc.).

2. Demand assessment (size, elasticity).

3. Analysis of your own capabilities (cost structure, sales channels, etc.).

4. Studying the capabilities of competitors (to determine pricing policy).

5. Selection of a pricing strategy and pricing method (criterion - obtaining maximum profit).

6. Analysis and consideration of factors influencing the setting of prices (inflation, market fluctuations, etc.).

7. Final acceptance of the price.

A pricing strategy is a set of rules and practices that are advisable to adhere to when setting market prices for specific types of products.

There are five stages in developing a pricing strategy: goals; general pricing policy; pricing strategy; implementation of pricing strategy; price adjustment.

All aspects of this process are influenced by external factors: consumers; government; distribution channel participants; competitors, etc.[10]

The main elements of an effective pricing strategy are[11]:

— rationally formulated goals of the pricing strategy;

— pricing strategy factors;

— price offer forms;

— price structure of the product range;

— pricing methods.

The development of pricing policy and strategy involves a number of works, calculations and actions that need to be reviewed when producing a new product or service or changing the general competitive environment. A pricing strategy does not function effectively if prices change too frequently, making the pricing policy difficult to explain to consumers; distribution channel participants indicate insufficient profit share; Pricing decisions are made without complete market information, and a significant proportion of goods are discounted or prices are reduced at the end of the trading season to eliminate excess inventory[12].

Pricing strategies establish the principles for setting prices for products or services, both new and existing ones.

Several criteria can be used to classify pricing strategies[13].

1. Based on the price level for new goods, the following strategies are distinguished: “skimming the cream”; “penetration prices”; "average market prices".

2. Based on the degree of price change, the following strategies are distinguished: “stable prices”; "trailing falling price" or "exhaustion"; “increasing penetrating price.”

3. Based on the degree of differentiation of goods and consumer prices, the following strategies are distinguished: “differentiation of prices for interrelated goods”; "price lines"; "price discrimination".

The “cream skimming” strategy is a short-term opportunistic increase in prices. The basic rules for applying this strategy are usually the following[14]:

- buyers are attracted by massive promising advertising, are insensitive to price, are either innovators or snobs, wanting to own the latest or fashionable product;

- a product that is fundamentally new, without a basis for comparison, or a product of high demand, patented, a product of high and constantly improving quality, with a short life cycle;

- the company is well known and has the image of a manufacturer of high quality products, or is unknown and conducts an intensive sales promotion campaign at the time of product launch; has strong competitors; the production process has not been developed and costs may exceed the expected level of profit; the company does not have the necessary working capital to launch a new product on a large scale.

The advantage of the strategy is that it allows you to quickly reimburse marketing expenses and obtain capital.

The disadvantage of the strategy is that the high price attracts competitors, not giving the company time to gain a foothold in the market.

Example. The Odintsovo confectionery factory “Korkunov” released its first products only 10 years ago, but has already managed to take a worthy position in the chocolate candy market against the backdrop of such eminent competitors as Nestle and Red October. There are several reasons for this success: good timing of entering the market; there were no registered brands on the Russian market; the inscription “Korkunov” on boxes of chocolates sharply distinguished the products from the “assortment” of different factories; was given the image of a non-mass product[15].

The “penetration price” strategy is a significant reduction in prices for goods. It applies in the following case. Buyers must have low or average incomes; the products sold are most often consumer goods that have no substitutes. Companies or firms have production capacity as well as experience in situations where price increases are a problem.

The advantage of the strategy is the ability to reduce the attractiveness of the market for competitors. The disadvantage is the problem of further increasing prices while maintaining the size of the captured market.

Example. The main principle of the French retail operator Auchan when introducing it to the market is that Auchan should be associated in the minds of the consumer with the best prices. In France, the slogan “Auchan brings down prices” was used, in Russia - “A blow to prices”. The company enters the market with consistently low prices. Prices in this case attract many buyers, who ensure high turnover rates and large volumes, due to which bulk purchases are carried out with appropriate discounts and overhead costs are reduced [16].

The strategy of “average market prices” is the release of new products at the industry average price. It is used in all phases of the life cycle, except decline, and is most typical for most enterprises that consider making a profit as a long-term policy. Buyers have average income and price sensitivity. Products are most often standardized.

The advantage of the strategy is a relatively calm competitive situation.

The disadvantage of the strategy is the difficult identification of the product.

Example. OJSC Samara Fat Plant, having launched new types of margarine on the market several years ago, such as Domashny, Samara Cream, Rosinka, set the average market price for them. It is aimed at the middle-income segment of buyers.

After the initial prices (set for new products) have been in effect for a long time, it becomes necessary to change them due to changes in market conditions, the stage of the life cycle, or for other reasons.

The strategy of “stable prices” - unchanged regardless of any change in market circumstances. Typical application conditions[17]:

— the buyer is a regular and respectable, somewhat conservative client, for whom consistency of prices is important;

- product - prestigious, expensive;

- the company operates in an industry in which frequent and sharp price increases are traditionally considered “indecent”.

The advantage of the strategy is high relative profit (per unit of goods).

The disadvantage of the strategy is that the company must have a constant reserve to reduce costs, while maintaining the same level of quality if possible.

Example. American cosmetics on the Russian market are aimed at high-income, respectable customers, for whom it is not only and not so much the quality of the product that is important, but its price. Therefore, the company has set a relatively high price for the product it produces and strives to keep it at this level, maintaining the high quality of cosmetics.

"Trailing falling price" or "exhaustion" strategy . In most cases, this strategy is used when there is a stepwise price reduction after the segment is saturated. A company that has chosen this strategy has the opportunity to increase production volume and partially change technology. Therefore, the products on the market are quite fashionable and relevant, and they are purchased by public opinion leaders. They are called "copycats."

The “penetrating price growth” strategy is an increase in prices after the implementation of the penetration price strategy. The essence of this strategy comes down to the following[18]: the marketing goal is to use the existing position and maintain the gained market share.

Typical application conditions:

- buyer - mass, regular (follower of the brand);

— the product is recognizable, there are no substitutes;

— the company is powerful, has experienced marketers.

Example. Several years ago, the Ravioli concern, when launching a new variety of cutlets, Raviollo, offered them to customers at a gift price. At the same time, the sale of cutlets at this price was limited - no more than two packs were given out.

Strategies for product and consumer price differentiation

There are several pricing strategies that use product and consumer differentiation as a basis for decision-making[19].

The strategy of differentiating prices for interrelated goods is used in cases where the market is easily segmented, there is the possibility of stimulating or restraining sales of a variety of products, and there is a wide range of prices for complementary and component goods. In other words, conditions are created to encourage consumers who have an average or high income to consume.

There are variants of the strategy of “price differentiation for interrelated goods”[20]:

a) high price for bait goods, image goods and the use of low prices for cheap or new goods (used when selling clothing, cosmetics, confectionery, souvenirs);

b) the low price of the main product is compensated by inflated prices of complementary goods;

c) bundling complementary or independent goods into a set at a reduced price (lower than the selling prices of individual goods).

The “price lines” strategy is used when there is a sharp differentiation of prices for assorted types of goods. It is used when it is necessary to create in the eyes of buyers an idea of ​​a fundamental difference in product quality, which in fact is quite difficult to define unambiguously. Buyers will be those segments that have high price elasticity of demand. The manufacturing company relies on the knowledge and experience of the marketing service and has the ability to conduct expensive research.

Within the framework of this strategy, there are so-called psychological price barriers, which are designed to determine the range of “trust in prices.” When the price is set at a lower threshold, the consumer doubts the quality of the product. Setting the price at a high threshold encourages consumers to make a purchase. As a rule, a company works with goods of a certain level of quality (for example, average) in an appropriate price range. The marketer must find price intervals in this range within which demand does not change when prices change (psychological inelasticity of demand with respect to price)[21].

“Price discrimination” strategy . Following this strategy, a company sells one product to different customers at different prices or provides price incentives.

Buyers should be repeat customers who are easy to identify. Products are most often unique in nature; there are no substitutes.

Varieties of “price discrimination” strategy[22]:

a) benefits for permanent partners;

b) different prices depending on the time of use and type of consumer.

Thus, systematization of pricing strategies allows

with the least risk, determine an action plan, assess the needs and capabilities of all subjects of the pricing mechanism. Based on the strategy, pricing tactics are developed - as a system of specific practical measures and a set of actions that ensure the implementation of the chosen strategy for managing prices for goods, based on the current market situation at a certain moment and including the implementation of the seller’s goals in each market and for each product for a given time interval. In order to implement the chosen pricing strategy, a price formation methodology is also determined - a set of specific methods, recommendations, tools and tools within the framework of the current methodology of the pricing mechanism.

Distribution (sales) strategies

This group of distribution (sales) strategies can be characterized by interpreting the following definition: “A sales strategy is understood as a special way of carrying out activities that ensure the delivery of goods and services of the manufacturer to intermediate and final consumers, which can take three main forms:

— creation or implementation of fundamentally new types of sales activities in relation to competing ones;

— a qualitatively different combination of traditional activities in relation to competing structures;

— implementation of traditional activities in the traditional system of their association”[23].

The distribution strategy of a company operating in a particular industry is built in accordance with the conceptual guidelines that have developed in it. For example, for computers or cars, the concept is radically different. However, in principle, approaches to its justification can be legitimately formulated within the framework of the five steps presented in Fig. 1.4.3.

This diagram reflects the transition from choosing a fundamental position in relation to the sales concept (step 1) to presenting the company’s strategy and competencies (step 2), then to assessing the possibility of applying the sales concept according to F. Kotler (step 3) and approval in one or another concept (step 4). The final action is approving goods, changing prices, working with inventories, organizing services, etc. (step 5).

Marketing strategy - don’t forget about analytics

You are not Vanga. No matter how well a marketing strategy is developed, it will still require constant refinement and improvement.

Any marketing implementation should end with analytics and summing up. Unfortunately, in Russia, more than 80% of entrepreneurs do not really know how much money was spent on advertising and what results they got.

What to analyze:

• number of applications;
• cost of applications;
• LTV;
• ROI - return on investment of a channel or tool;
• sales.

Based on these data, appropriate conclusions can be drawn about the effectiveness of the marketing strategy.

It especially amuses me when clients complain that advertising doesn’t work, but they don’t even have a metric counter installed on their website. I hope that thanks to my article you will be more responsible about analytics.