Understanding Business & Marketing Strategies
Business Evolution & Marketing Approaches
Commercial activity serves as the nexus between businesses and the market, aiming to meet consumer needs. The marketing function enables companies to maintain contact with consumers, identify their needs, and produce goods that facilitate mutually beneficial exchanges. Historically, firms have reoriented their strategies based on four primary approaches: product, sales, marketing, and social marketing.
Product Focus
Companies adopting this approach concentrate their marketing efforts on creating high-quality products, believing they will sell themselves. Their priority is manufacturing products rather than deeply understanding customer needs.
Sales Focus
This perspective assumes the market can absorb all products if subjected to sufficient advertising pressure. The primary objective is to sell what is produced. This strategy is often viable in expanding markets with undifferentiated products and consumers with limited experience.
Marketing Approach
The core purpose of marketing here is knowing and understanding the customer, with the belief that a well-suited product will sell itself. Modern marketing increasingly focuses on attracting new customers and retaining them through loyalty programs. This is often referred to as relationship marketing, where companies strive to maintain continuous and constructive relationships with their customers.
Social Marketing Approach
While dominant in contemporary society, the appropriateness of this approach is often questioned in an era of environmental degradation, resource scarcity, and poverty. It attempts to rebalance three key considerations: the benefits for the company, satisfying consumer needs, and ensuring societal welfare in the medium and long term.
Marketing Planning: Strategic & Operational Phases
The marketing planning process is fundamentally divided into two main components: strategic marketing and operational marketing.
Strategic Marketing Planning
Strategic marketing involves a deep reflection on market opportunities with the objective of designing the company’s commercial strategy. This phase includes:
- External Analysis: Discovering opportunities and threats within the market environment. This involves assessing competitors and their practices, as anything can affect the company.
- Internal Analysis: An assessment of the company’s strengths and weaknesses to evaluate if human and material resources are sufficient to meet its objectives.
- Objective Setting & Strategy Design: Defining the objectives to be achieved and designing the marketing strategy to accomplish them. This involves choosing the target audience or market segments the company wishes to serve and deciding on the desired image for its products in the minds of consumers.
Operational Marketing Implementation
Operational marketing involves deciding on and executing the commercial activities necessary to achieve strategic goals. This typically includes:
- Defining the Marketing Mix (4 Ps): Deciding on the Product to attract demand, the Price to obtain the desired response from consumers, the Place (distribution) to ensure convenience and accessibility for the consumer, and Promotion (communication) to inform and persuade the consumer. Combining these variables creates the marketing mix.
- Specifying Resources: Identifying and allocating the necessary human and material resources for framing and executing the plan.
- Implementation & Control: Putting the plan into action, including continuous monitoring and control, and taking corrective steps as needed to ensure objectives are met.