A methodology for designing marketing strategies for for-profit companies
Strategic management as a new style of business management that seeks to adapt contemporary management to the changes that are taking place has begun to be introduced and applied in our organizations with satisfactory results.
The business improvement in which our economy is immersed has determined “as one of the main functions of the Cuban socialist company to direct the process of strategic planning and the DPO; as well as organize, direct and control the marketing and sales activity of the company, among others ”.
In this context, our organizations are faced with the need to change their management methods, as well as their philosophy, taking into account that the focus of the companies are their clients, with their needs and desires, which requires “employment of modern business management techniques, adapted to our conditions and based on the best and most advanced contemporary practices ”.
It should be noted that business planning is a process that requires managers to apply the appropriate methodology that allows them to systematically analyze the relationship of their organization with the environment and reflect on the results that can be expected from the alternative application of different means of action, suitably combined for this purpose. It has among its main advantages the need to constantly reflect on the trends of your organization and the market, it provides the basis for a better definition of objectives and policies, allowing you to reduce risks.
In addition to enabling better allocation of resources, and better coordination between different departments, it makes it possible to be better prepared to react to sudden changes in the market or to the actions of competitors, and greater coordination of efforts and resources, for which it requires time and effort and the need to be flexible and able to adapt to change quickly.
The specific conditions and current characteristics of the environment in which the Cuban economy is moving have made it necessary to use many and varied techniques that allow it to achieve competitive advantages. Marketing has become more important in our companies, however managers do not have a methodology that makes their job easier.
Strategic marketing management is a process that allows companies to be proactive rather than reactive in formulating their future. This can be described as an objective and systematic approach to decision-making, made up of three fundamental stages: formulation, implementation and control of strategies.
To better understand the role that marketing strategies should play within the organization, an analysis of the company's mission and objectives is necessary. It is for this reason that the study of the strategic context in which the marketing plan must be inserted is proposed as the first stage, which will allow us to know if the marketing objectives and strategies really correspond and ensure the fulfillment of the organization's objectives. Subsequent steps in formulating business strategies should focus on achieving the highest goal of the organization.
It should be noted that in the event that the mission and objectives are not defined in the entity, it is necessary to start the process with this stage. If, on the contrary, there is the strategic planning of the company and the mission has been established as part of it, it is advisable to evaluate it to ensure that it defines the purpose, products and relevant markets, which should constitute aid for the review of current and future strategic options. The mission must be realistic, feasible and flexible, reflecting the skills, knowledge and values of the participants in the organization's offerings, allowing an integration with the objectives.
The mission, in addition to being the supreme objective of the organization, is an important guide to coordinate all the activities of the company, hence the need for greater clarity in its formulation so that it truly allows the commitment of all its members..
Once the mission and objectives have been defined, the organization then analyzes what role marketing should play in its fulfillment.
In other words, it is the objective of this first stage to understand how the marketing objectives and strategies must be formulated so that they lead to the achievement of the organization's mission, taking into account that the marketing strategies cannot be formulated until these elements are defined, Since the basic purpose of analyzing the strategic plan is to provide a comprehensive reference framework to implement the strategy, in order to achieve the specific objectives of the commercial area and their correspondence with those of the organization.
The second stage provides for the analysis of marketing activity, or what is known as the marketing diagnosis. Taking into account that for this stage to be carried out successfully, it is necessary to understand not only the environment in which the organization moves, but also the possibilities it has internally to fulfill its mission, this stage in turn consists of two steps.
The first step is aimed at finding what are the factors that exist in the environment that may constitute an opportunity or a threat to the marketing management in particular. In other words, it is an analysis of both the microenvironment and the business macroenvironment.
For this, it is proposed to carry out an analysis of the competition, the market, the suppliers, as well as demographic, legal, economic, political factors, among others, that affect marketing management. Keep in mind that each of these factors can be analyzed from different edges or variables. These factors are not controllable by companies and institutions in the sector, but require detailed knowledge to determine which constitute opportunities and which constitute threats.
Among the main sources of information to carry out the analysis of the environment are the results of market research, customer surveys, interviews with professionals, experts and managers of the organization. Positioning studies, behavior reports of the main markets, characteristics of the competition, among others, may also be used for this purpose.
The second step of this stage recommends an internal analysis of the organization, allowing it to define what its strengths and weaknesses are. That is, in this step it is important to take into account factors such as: product quality, marketing mix strategies, positioning, personnel available, material and financial resources, effectiveness of communication stimuli, etc.
In this case, the use of tools can be very useful, such as the internal and external factors evaluation matrix, the SWOT matrix, the competitive profile matrix, segmentation studies, the product portfolio evaluation matrix, as well as the use of secondary information found in the organization, including sales history of the company, price, segmentation, market behavior studies, economic reports, the results of the system of surveys that the entities have, studies of positioning and image, the investment programs that are planned, and any other information that provides relevant data in this regard.These instruments will allow the organization to have more information about the different factors that affect the organization's marketing activity.
It must be emphasized that it is a fundamental objective of this second stage to collect all the data necessary to determine more clearly and precisely how business can be successful. Therefore, both the information collected in the internal and external diagnosis require to be related and not seen in isolation.
After making the diagnosis and determining the main factors that both internally and externally affect the organization's business management, it is necessary to review the mission and objectives to determine if, given the existing conditions, it is in progress. conditions to fulfill them.
The third stage of the process of formulating marketing strategies is the determination of the objectives. This is an extremely important stage, which begins of course with the elaboration of the mission that is the supreme objective of the organization.
A marketing objective is a precise statement, which expresses what must be achieved with the marketing activities of the company and towards which it will focus its efforts. They represent the results that are expected to be achieved through the actions that will be taken in the commercialization area.
Setting marketing objectives makes it easy to determine where you want to go and provides measurement criteria to assess performance.
The establishment of the marketing objectives has its origin in the data, analysis and results that are valued in the previous phases. Only the analysis of the organization's mission, where it wants to be in a certain time, its current situation, and the conditions under which it has reached where they are, as well as the conditions in which it will work in the short term will allow defining Marketing objectives clearly.
Marketing objectives, like corporate objectives, must be relevant, specific, measurable, subject to time and challenging. In this case it is necessary to point out that they must be focused on issues related to the markets, products and services that the organization wishes to attend to.
The objectives must fulfill the following functions: constitute a guide for the coordination of decisions and main actions in the marketing area, offer the basis for the evaluation and control of the activity and involve all the members in the achievement of the mission.
After completing this stage, the organization must review the global objectives in order to assess whether there really is a correspondence between these and the marketing objectives, and whether the marketing objectives will actually allow the fulfillment of the former and thus the mission of the organization.
To comply with the marketing objectives set, the organization must draw up strategies that allow them to meet them, which constitutes the fourth stage. This answers the question of what are the possible ways to fulfill the marketing objectives?
The strategy that will guide the behavior and activity of the company in the future is the result of the coordination of three elements: the aspirations that senior management has, the opportunities and threats that the environment presents, and the capabilities that the company has. organization. It is vital that senior management take responsibility for the strategy formulation process and also get the commitment of all members of the company, because otherwise this process would not make sense, which must also be supported by adequate concern to provide the company the structural and instrumental conditions necessary to correctly carry out the formulated strategy.
This stage is based on the result of the diagnosis and the identified marketing objectives, generating different feasible alternatives, since in most cases there is no single strategy, but several possible alternatives to achieve the objectives, which will require an evaluation. and the selection of specific strategies. Once the main strategic options have been identified, they will be evaluated to select the most feasible ones.
The feasibility of the options can be evaluated considering factors such as:
- Correspondence with the marketing objectives. Availability of resources for its implementation. Degree to which it corresponds to the mission of the organization. Acceptance by those involved in its implementation.
These factors will be evaluated for each option, assigning points (any scale can be used) and those with the highest scores will be chosen.
Marketing strategies are the means, through which marketing objectives are met, the set of basic actions through which it is hoped to gain an advantage over competitors, attract buyers and an optimal exploitation of resources.. They outline a plan to achieve marketing objectives through the elements of the marketing mix, that is, through product, price, promotion, and distribution.
In the case of the product, the range of products, the modification of the product, the creation of a new product must be taken into account. Other important aspects to take into account when designing strategies through this element are the brand policy, with its positioning, the creation and protection of the company's image, the analysis of its own attributes with respect to other competitors, etc..
For the promotion variable, the choice of the message or messages and the media and supports, the advertising at the point of sale, the ways of incentivizing consumers and / or intermediaries, the establishment of an adequate sales force, should be considered, determining their size, ways of acting, etc.
In the price it is convenient to pay attention to the analysis of costs, the calculation of the profitability threshold, the value perceived by customers, without forgetting of course the analysis of the prices of the competitors, the maximum allowable price, discounts, etc..
For distribution, the design of the distribution channels to be used, the physical distribution of the products, the location of the points of sale, the market coverage (intensive, selective, exclusive), as well as the means of cooperation with the intermediaries.
The identification of marketing strategies are facilitated with the use of data entry tools, among which are the portfolio matrices referred to in the previous phases and the analysis of the product life cycle that allow propose and decide on different options through the comparison of internal and external factors.
Up to this point related to the strategy formulation process, a brief description of the other stages that are part of the implementation and control process will follow. The implementation of strategies implies the restructuring and reorganization of internal activities in such a way that they stimulate and reward efforts to achieve the proposed marketing objectives.
In order to enable the implementation of the selected strategies, an action program is necessary, which constitutes the fifth stage, and whose main objective is to specify the different actions to be taken to comply with the planned strategies that will ultimately enable meet the needs of customers. The purpose of this action program is to ensure that the entire company team knows what actions they are responsible for and to determine how to allocate the material and financial resources available to ensure success in the market.
This action program must be detailed and encompass activities such as the allocation of responsibilities to personnel, budget, compliance date, priorities and allocation of resources, and at the same time it needs to be closely linked to the final stage, which is monitoring, control and review.
It is necessary to assign the tasks and the corresponding responsibility, coordinate and integrate actions, establish the lines of authority and the channels through which the information must flow. It should be borne in mind that the way in which the members of the organization are going to be guided, trained and motivated, who will be responsible for implementing and executing the plans, is extremely important.
When the action program has been prepared, a check should be made of the diagnosis of marketing management that was carried out in the second stage in order to assess whether the organization has known how to take advantage of its strengths, as well as the opportunities that the environment gives it to achieving your goals.
The purpose of monitoring, controlling and reviewing the results obtained, which, as already stated, constitutes the sixth and final stage, is to ensure that the proposed strategies and actions lead the business consistently towards achieving the objectives and mission of the organization. Control is defined as the process of taking measures to bring the actual results closer to those desired. The purpose of a control system is to ensure optimal execution of the plan.
The fundamental elements of a control system are:
- The setting of standards or measurement criteria in the marketing area, for each of the elements of the plan. Measurement of the results to detect deviations from the standard. Analysis of the causes when a significant deviation is detected. Application of measures corrective, those whose purpose is to rectify the results so that they conform to what is planned.
There are four types of control of the commercialization activity: the control of the annual plan that has the purpose of examining if the expected results in the plan have been achieved and taking corrective measures when deemed necessary, this control is carried out by senior management; profitability control, consisting of determining where the company is making or losing money; Efficiency control, which involves evaluating and improving the efficiency and impact of marketing expenses, and strategic control, which will periodically review whether the basic marketing strategies are in line with the company's opportunities and resources.
That is, as the marketing plan is implemented, performance indicators must be determined to measure efforts. These criteria, of course, are derived from the marketing objectives as well as the action program.
These indicators or criteria may include: income, market share, marketing costs, earnings, effectiveness of advertisements, productivity of sales forces, efficiency of distribution, of promotions, among others.
At this stage it is necessary to establish the information systems and procedures to ensure that the information is issued correctly, by the right person and at the right time.
It should be noted that the organization must systematically carry out a feedback process that allows it to be aware of its situation, both externally and internally, since this will allow it to be prepared to react to changes that may occur and that involve a reformulation of the objectives and strategies outlined.
Another aspect to take into account is that the most important thing within the proposed model is not any of the constituent elements separately, but the internal coherence of all its parts. Once the organization has been drawn up, you should review it and reflect on whether there is a true alignment between the clients you are targeting, the characteristics of the product, its price, the way in which it will be disclosed and how it will be distributed.. If this plan is duly prepared and approved, it must become the instrument that regulates, controls and directs all the action of the company on its markets.
| STAGES | QUESTIONS | TOOLS |
| I-Analysis of the strategic context. Mission. General objectives | What is our reason for being? - What are our clients? - Where do we want to be within three
years? |
Brainstorm.-Group work (sessions) |
| II-Marketing Diagnosis: Analysis of Macro and microenvironment Marketing opportunities. Internal diagnosis | Who are we? Where are we ?; How have we got there? What threats are
stand in the way of the organization's success? What favorable possibilities arise? |
External factors evaluation matrix, internal factors evaluation matrix, General Electric, matrix
internal-external, life cycle analysis, etc. |
| III-Formulation of marketing objectives | Where are we going in terms of the market? | Objective Tree- Scenario Theory |
| IV-Formulation of marketing strategies | What are we going to do to achieve the proposed marketing objectives? | SWOT matrix, portfolio evaluation matrix, life cycle analysis |
| V- Action program | What actions to execute to achieve the strategies? Who is responsible? When
Will it run? How much will it cost? |
Budgets- Gantt Chart- Network Theory |
| VI-Monitoring and Control of results | What is happening? Why is it happening? What should we do? | Analysis of sales, analysis of market share, efficiency of the sales force, marketing audit,
advertising efficiency, profitability by product, by channel, by territory, etc. |
Bibliography
- General Bases for Business Improvement Economic Resolution of the V Congress of the PCC. Political Editor, Havana, 1997. Page 19.Bowman, C. The essence of strategic management. Editorial Prentice Hall, Mexico. Hispanoamérica SA, 1990.Cliff, B. The essence of strategic management. Editorial Prentice Hall. Hispanoamérica SA México, 1990. David, F. Strategic management. LEGIS Editorial Fund, Colombia, 1994. Molina, I. and Torres, Diego. The Marketing plan. (Material from the Marketing Diploma, 1998).Nagle, T. Pricing strategies and tactics. Editorial Prentice Hall, N. Jersey, 1987. Ortega, E. Marketing management. ESIC Editions, Third Edition, Madrid, 1987. Saínz de Vicuña, J. The Marketing plan in practice. Editorial ESCIC, Madrid, 1995. Sanz de la Tajada, L. Importance of commercial planning.Commercial strategies and policies. (All DEADE materials), 1996. Vazquez, R. Y Trespalacios J. Marketing: sector strategies and applications. Civitas Editions, Madrid, 1994.
