Download ANALYSIS OF MARKETING STRATGIES

CHAPTER- 6
ANALYSIS OF MARKETING
STRATGIES
Stratgy is vital to exccute plans for acheivingpre-defined goals and
objectivessetby any business.Here the analysisof variousmarketingstrategies
which are useful to win the rural conumers in comparision to other
competitors,described.
Marketing Strategy Planning
Marketing strategy planning means findings attractive opportunities and
developing profitable marketing strategies.But firs it is necessaryto understand
meaning of "marketing strategy". These words are rather casually so far. Now
let's see what thev reallv mean.
Marketing strategy
A marketingstrategyspecifiesa target market and a relatedmarketing
mix. It is a big picture of what a firm will do in somemarket.Two interrelated
parts are needed:
1.
(similar) goup of customer
A Target Market: A fairly homogeneous
to whom a companywishesto appeal.
(144)
2.
A Marketing Mix: The controllable variables the company put
together to satisfli this target group.
Fig 6.1 A MarketingStrategyShowingthe four Ps of a MarketingMix.
Fig. 6.1
Marketing Mix
Product
Place
Promotion
{
The customer is surroundedby the controllablevariablesthat is called
1
{
as "rnarketing mix". A typical marketing mix includes some product, offered
at a price, with some promotion to tell potential customersabout the product,
and a way to reach the customer's place.
Selectinga Market-Oriented Strategy is Target Marketing
Note that a rnarketing strategy specifies some particular target customers.
'inass
This approach is called "target marketing", to distinguish it Ilorn
marketing". Target marketingsays that a marketingmix is tailored to fit some
specific target customers.In contrast,massmarketing- the typical productionorientedapproach- vaguely aims at "everyone" with the sarnemarketing mix.
I
(145)
Mass market.ingassufilesthat everyoneis the same and it considerseveryone
the
to be a potential customer. lt rnay help to think of target rnarketing as
"rifle approach" and mass marketing as the "shotgun approach"'
Cornmonlyused terms can be confusinghere The terms massrnarketing
and mass marketers do not means the same thing. Far frorn itl Mass rnarketing
tneans trying to sell to "everyone", as well explainedabove. Mass marketers
like Kraft Foods and wal-Mart are aiming at clearly defined target markets
The confusion with rnassmarketingoccursbecausetheir target rnarketsusually
are large and spread out.
Target rnarketingis not limited to small market segrnents only to fairly
homogeneous ones. A very large market even what is sometimes called the
"mass market" - may be failure homogeneous, and a target marketer will
deliberately aim at it. For example, a very large group of parents of young
chilclrenare homogeneouson many dimensions including their attitudesabout
changing baby diapers. In the United States alone, this group spends about
$4 billion a year on disposablediapers so it should be no surprise that it
is a major target market for companies like Kimberly-clark (Huggies) and
Procter & Gamble (PamPers).
The basic reasonto focus on some specific target customersis so that
one can developa rnarketingrnix that satisfiesthose crtstomers'specific needs
better than they are satisfied by some other firm. For example E* trade uses
an internet site (www.etrade.com) to talget knowledgeable investors who want
I
(146)
a convenient,low-costway to buy and sell stocksonline without a lot of advice
(or pressure)from a salesPerson.
I
',
\
When a firm carefully targetsits marketingmix, it is less likely to face
clirectcompetitors.So superiorcustomervalue is achievedwith the benefits
providedby the whole marketingmix ratherthanjust by relying on a lower
price Whole FoodsMarket(WFM) is goodexample.Most grocerystoressell
the sarnebrands - so they cotnpeteon price and profits lend to be weak'
ln oontrast,WFM rnakesattractiveprofits with a differentiatedrnarketingrnix
that delightsils target custolners.WFM seesitself as a buying agent for its
customers and not the selling agent for manufact.ures- so it evaluated the
ingredients, {ieshness, safety, taste, nutritive value, and appearanceof all the
products it carries. It hires people who love food. They don't just sell fooc
- but rather help their customers appreciate the difference natural and organic
products can make in the quality of their lives. Service is attentive, friendlyand oflered with some flair, which helps make the store fun and inviting.
Customers often socialize while they shop. Note everyone wants the marketing
rrix that WFM offers; but its target customerslove shoppingthere - and they
spread the word to others.
Developing Marketing Mixes for Target Markets:
There are many possibleways to satisf, the needsof target customers.
servicelevelsbefore
A productrnighthavernanydifferentfeatures.Customers
or after the sale can be adjusted.The package,brand name,and warranty can
-t
l
(147)
be changed.Various advertisingmedia - newspapers,magazines,cable, the
Internet- rnay be used.A company'sown salesforce or other salesspecialist
can be used. The price can be changed,discountscan be given, and so on'
with so many possiblevariables,is there any way to help organizeall these
decisionsand simplifi the selectionof marketingmixes ? The answeris yes.
It is useful to reduce all the variablesin the marketing rnix to four basic
ones:
PRODUCT
PLACE
PROMOTION
PRICE
It helps to think of the fbur major parts of a marketing rnix as the "four
Ps." Ernphasizes their relationship and their common focus on the target
customer - "C". as exhibited in fig. 6.1 earlier.
Customersis not Part of the Marketing Mix
by the four Ps.Somepersonsassurne
is shownsurrounded
The custorner
that the customeris part of the marketingmix - but this is not so. The customer
should be the target of all marketingefforts. The customeris placed in the
centerof the diagramto showthis. The C standsfor somespecificcustomers
the tarset market.
l
(148)
ln short contentsof each P are depictedin table 6 l as below
Products
Place
Physical good
Servtce
Features
Benefits
Quality level
Accessortes
Installation
Warranty
Product lines
Packagrng
Brandrng
Objectives
Channel type
Market
exposure
Kinds of
middletnen
Klnds ano
locations of
stores
How to handle
transporting
and stortng
Service levels
P
I
""'.
'itino
rniddlernen
Managing
channels
Promotion
Price
Objectives
Promotion
blend
Salespeople
Kind Number
Selection
Training
Motivation
Advertising
Targets
Kinds. of ads
Objectives
Flexibility
Level over
product life
cycle
Geographic
tenns
Discounts
Allowances
Media rype
Copy thrust
Preparedby
Whom Sales
Promotion
Publicity
Product
The product area is concerned with developing the right "product" for
the target rnarket. This offering may involve a physical good' a service, or
a blend of both. Keepingin mind that productis not limited to physicalgoods.
For exarnple,the productof H & R Blockis a completedtax form. The product
of a politicalparty is the set of causesit will work to achieve.The irnportant
thing to remember is that goods or servicesshould satisfu sorte custotners'
,t
needs.
(14e)
Along with other product-areadecisions like branding, packaging and
warranties, any company about developing and managing new products and
whole product lines.
Pluce
Place is concerned with all the decisions involved in getting the "right"
'i
product to the target market's Place.A product isn't much good to a customer
if it isn't available when and where it's wanted.
A product reachesupto customersthrough a channel of distribution. A
channel of distribution is any series of firms (or individuals) that participate
in the flow of products fiom producer to final user or consumer,
Sometimes a channel system is quite short. It may run directly from
a producer to a final user or consumer.This is especiallycommon in business
rrarkets and in the marketingof services.The channelis direct when a producer
uses an online website to handle orders by target customers,whether the
custolner is a final consumers or an organization. So direct channels have
becorne much more conunon since the development of the Intemet.
On the other hand, often the channel system is rnuch more complex
- involving rnany different retailersand wholesales.When a marketingmanager
has several different channels of distribution may be needed.
Also it is seen low physical distribution service levels and decisions
concerninglogistics (transporting,storing, and handling products) relate to the
other place decisions and the rest of the marketins rnix.
l
(150)
Promotion
'l'ltc
thir.rl P
I)rorrroti0rr is conoerrrcdwith tcllirrg tlrc titrgct ttt:trkcl
or others in the channel of distribution about the "right" procluct. Solnetinles
prornotion is focused on acquiring new customers, and sometimes it's focused
on r-etainingcurent customers. Promotion includes personal selling, rnass
selling, and salespromotion. It is the marketing manager'sjob to blend these
rnethodsof communication.
Personalselling involves direct spoken comrnunicationbetween sellers
and Potential oustotners.Personal selling usually happens face-to-face,br.rt
sometimesthe Intemet. Personalselling lets the salbspersonadapt the hnn's
rnarket.ingmix to each potential customer. But this individual attention comes
at a price; personal selling can be very expensive.Often this personal effort
has to be blended with mass selling and sales promotion
The rnain form of mass selling is advertising- any paid form of non
personal presentationof ideas, goods, or services by an identified sponsor.
presentation
of idea, goods or
Publicity - any unpaidform of nonpersonal
services- is anotherimportant form of rnassselling. Mass selling may involve
a wide variety of rredia, rangingfrom newspapersand billboardsto the Intemet.
Sales promotion refers to those promotion activities -
other than
advertising,publicity, and personal selling - that stimulate interest, trial or
purchaseby final custorners
l
(151)
Price:
and promotion'
In addition to developingthe right product' place
Price While price setting the
rnarketingmanagers,must also decidethe right
the cost of rnarketingmix must
kincl of competition in the target market and
forecast ctlstomer reaction about
be considered.A manger must also try to
reach of purchasingpower of target
the possible price, lt must be with in the
customer-Besidesthismanagermustbeaware-aboutcurrentpracticesasto
sale An if Customers won't accept
rnark-up, discount and others in terms of
wasted So' Price is most important and
the Price, all the planning effort is
for making successful any rrarketing
sensitive segment o1' rrarketing rnix
strategytoo.
strategy both part of rnarketing
For rnaking a successful marketing
manner (target rnarket and marketing
strategy must be tied together in a rational
and developing a rnarketing lnlx are
rrixl. The selecting a target market
must be evaluated against the company's
interrelated. It is strategiesthat
objectives.
Limited is in centre of focus'
For this research work Hindustan Lever
professionalcompany of India in FMCG
Hindustan Lever Lirnrted is leading
fbr
adopting separaternarketing strategy
sector. Hinduslan Lever Limited is
is making and implernentingthe rural
taping mral rnarket of lndia Company
of
micro and macro tevel Sign of sucess
rnarketingstrateglessuccessfullyat
tlresestrategiesisncreaseofruralshareinthetotalsaleofcornpany'Company
blend of marketing mix by utilising all
is focusing target market with a right
]atestKnowledgeofworldclassprofessionalsofallfieldsalongwith.latest
(152)
by treating
technology for making result orientedfruitful marketingstrategies
each product, Product line as separateProfit centre
ForgettingtheresultfiomthisstudythatthestrategiesadoptedbyHLL
:
inMeerutarefiuitfulornot'Theonlyyardsticktomeasuretheel}.ectiveness
ofcurentruralmarketingstrategiesiswhetherthesalesisincreasinginall
t,.
Seglnentsandproductlinesornot.Hereanalysishasbeenmadeonthebasis
lines' which zre most popular'
of five-year data of Salesof HLL of all product
products in Rural belt of Meerut
and HLL wants to lncreasesales of those
I
1
district. Table 6.2 revealed following data'
Table6.2
Sales Data of HLL in Rural Meerut
2t)01
Salcs
in
Toncs
2[ll2
2003
2llll4
GroNth
2005
I
ln
tl
"/o
I'roducts
ll llutg Soll
l.l
?31
\\ ashitu llat
.t001.i
2665.1 1t12.45 1282.1 l92l.9l
1372
1i50.6
624.95 120.5
TotAl
Sales
1.415232t9.4720Er 5 3 5 3 . 8 6
15.34334 u.ntoozl
4l8l
47X5
t2.23165 |.2211( 11.4755 t2.53289l y 0 l 3 . I
842.1
944.l
r6.31305 t5.28922t6.90493 12.085963669.15
DislrNashingBar
537.1
\\'aslin! Powder
n112
2h62
2441.9
2899
16.6Q22813106.2
1s.42804
1960.1 t8.69615 18.71484
Sh||Inpoo
l(,1l
111\
11r9
4t4.1
505.06 3.01835936.712131l.1ttl272l.r{1681 lli24.ll6
23lt.4
212.1
2 0 9 . 1 I 211.67
9.52.1591t.l.2l9ll ll12.,lll
7.2158r74.0v151'
Ir rhPi,.rt.l'i,\der
l9i
291{
t2tt
('9
78t
915
1 7..]]931t0.i60iI
1 0 . 0 6 ? l l103.9634
2995
l . t u r | , , \i l \
I1
508
611
139
16.32653 t91|16 2l.45669 t r . 7 ?I l
?182
t47
above with the % growth with
On the basis of sales data as given
"t" test has been used for judging the
reference to previous year- paired
adopted by HLL in Meerut district.
effectivenessof rural marketing strategies
(153)
Null Hypothesis:
There is no difference in sales before and after the using spocial rural
marketing strategies.
Alternate Hypothesis:
The increasein rural salesis due to implementingthe new marketing
stratesiesin rural belt of Meerut.
PariedDifferences
std. Std,f,rror
NIean
Deviation Mean
95%
Consfidence
Int€rval
of the
Difference
Loiver
Upper
Irft Tail
Pair-l VAR 2001-02-151.2162 165.8853s8.6493 -289.959E-12.5927-2.579
(Sale$
Pair-2VAR 2002-03-269.1200 176.124662.4816 -416.8654-121.3746-4.037
(Sale$
Paid-3VAR 2003-04-t7s.3350 167.944359.3773-315.7400-34.9300-2.953
(Sale$
Paid-4VAR 2004-05-337.8463 367.9[4 130.0763445.4279 -30.2646-t {q7
1l
l
I
df
7
7
7
7
't' is > I .90 therefore we
Here the calculatedvalue of each year of
reject the null hypothesisand acceptthe alternatehypothesisthat the sales
increaseis the result of implementationof specialrural marketing strategies
by HLL every year. For showing performanceof each category of product
comprative sales graph in depicted in annexure.
i- .ll --
f
Products' Comparative SalesTable
-
Salesin Ton
Years
Products
200:
2004
2001
3't72.4!
3282.7
3921.91
2001
2002
2311.1
2665.7
3004.5
3372
3750.t
537.3
624.9{
720.4
1737.i
2062
2447.4
289!
3960.1
263.3
271.!
370.!
414.3
505.06
19t
209.11
.217.67
238.4
272.1
298
328
66!
147
17'l
508
t
BathingSoap
WashingBar
4191
4703
DishWashingBar
944.1
WashingPowder
Shampoo
Ioothpaste-Powder
ig-
Fairn Lovely
91t
Vaseline
617
,ti
I
Sales(ln Ton)
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