ARBUS 302 Class Notes
January 14, 2013
CHAPTER 2: Developing Marketing Strategies
Individual submission - template for us to fill in, do not change any format, just fill it in.
File name: 344 Individual Submission 20343396 (Student #)
Send questions to Wang's gmail, she sends stuff via Waterloo but reply to her via gmail.
Finite resources - limited amount of resources (time, money, etc.). Many companies have this
problem and they need to have a good strategy to overcome these problems.
Disney Goes Digital
- Global positioning satellites
- Smart Sensors
- Wireless technology
- Mobile devices
- Pal Mickey - smart sensor technology. People were frustrated of waiting in lines at Disney land
so Disney created Pal Mickey. They add an element to their technology to help customer
satisfaction. They do it for their consumers which is tied to market share.
The Strategic Planning Process
Step 1: Defining the Missions and/or Vision
- It's important to have a mission that two constituency's can understand: the employees and the
- It has to be clear and show where the company wants to go
- Heart & Stroke Foundation missions statement example. They word it in a way that consumers,
funders, and donators can understand and want to give to. The vision is clear.
- Burton Snowboards - clear and simple message.
- Starbucks - good mission statement but there is a lot of execution in it and there are many ways
they could mess up. Your mission has to be something you can actually act on.
- McDonalds - It doesn't mention anything about making great food.
Step 2: Conduct a Situation Analysis Using SWOT
- SWOT is an ongoing thing. You are always looking at your strengths, weaknesses, threats, and
opportunities. Every now and then though a company will do an actual SWOTAnalysis.
Step 3: Identifying and Evaluating Opportunities Using STP
- Segmentation: groups that respond similarly to the marketing messages
- Positioning: the combination of the marketing elements - how are you going to position it in
terms or place, product, promotion, and price.
1 - Examples: Hertz - Market Segmentation. They offer different types of cars for each segmented
group (single, married couple, parents, retired couple or single, etc.) and they advertise/market
each one differently.
- Disney - Segmentation, Targeting, Positioning. Magic Kingdom (families with younger kids),
pleasure island (singles and couples), Epcot (adults, families with older children).
Step 4: Implement Marketing Mix and Allocate Resources
- Promotion Strategy
- Promotion and Value Communication
-Television, Radio, Magazines, Sales force, Social Media
- Place Strategy
- Place and Value Delivery
- Product must be readily accessible
- Why is 30 year old retailer Lee Valley still growing?
- Online option to buy
- Product and Service Strategy
- Product/Service and Value Creation
- Ex: Satellite radio. No commercials, niche music,
- Price Strategy
- Price and Value for Money
- Customer perception of value
- Price is only part of value
- What else do customers think about before they make a purchase?
- What is it that I have to give up?
- Time and Effort
Video - Staples 4P Strategy
- Watch this video and answer
- What is the "Easy Brand Promise?"
- making buying office products easy for their customers
- Easy to use products, good staff, overall experience at a Staples store is easy
- How does Staples use the 4P's to deliver on the "Easy Brand Promise"/
- Price: coupons in their flyers. Buy more, save more. 10-15% discount off the
national brand but same quality.
- Promotional: clip strips, in store advertising, circulars and catalogues outside of
- Product: they have a variety of products to offer
- Place: Stores are close to major roads and they have a lot of parking. They
have three channels for their customers - the catalogue, the website, and the store
(store layout - visual signing, popular items at the front).
- What are "impulse sales"?
- Buy more, pay less.
- P.O.P. - Point of Purchase: the little displays that people see when they are at the
2 point of purchase.
- What is the "Mailmate" and why was it developed?
- Junk Mail Destroyer. Prevents identity theft from junk mail. Small appliance that
fits in the kitchen and looks nice. Easy to shred paper.
- Why is their website important?
- Easy to use. Provides people with the option to buy on their lunch break or at
times when they are short on time. Saves time.
Step 5: Evaluate Performance and Make Adjustments
- Look at the relative market share and the market growth rate
- It helps you evaluate what is winning or losing in the marketplace. It helps you make good
4 Growth Strategies
- Market Penetration
- Existing marketing mix
- Existing customers
- Discussion questions: In what way is a sale a market penetration strategy? It promotes
people to move and buy. You get more sales out of a current customer base. It reduces the
margin but the volume goes up.
- Market Development
- Case in Point: Tim Horton’s
- Challenge: to continue to grow in a competitive retail environment
- Answer: Continue an international expansion strategy while also expanding
- 2724 Canadian outlets, 340 US outlets, total 2006 Revenue of $1.66 billion up
12% from 2005.
- Product Development
- New product or service ---> current customers
- A good example is the Healthy Choice line. Why did the makers of Chef Boyardee create a
selection of new products signed and marketed under this name?
- New product or service in a new market segment
- What is the difference between related diversification and unrelated diversification?
- Colgate owns Science diet (pet food) - unrelated
- Delta hotels owns Fairmont hotels - related
Sustainable Competitive Advantage - 4 aspects
- Discussion question: What do you think are the keys to McDonald's sustainable advantage? Food
delivery and efficiency.
- Locational excellence
- The three most important thing in retailing are: location, location, location.
- Starbucks did great at this
- Operational excellence
3 - Efficient operations
- Excellent supply chain management