Tools And Techniques In A Marketing Strategy Marketing Essay

Published Date: 23 Mar 2015

Small drops make an ocean. This is very true when it comes to the strategy adopted to any firm. Each and every step, decision, policy has a measurable impact on how the firm's strategy is going to get effected. In such a scenario, managers are extremely cautious about what they are doing and how they are doing as they would like to keep the strategic objective as a guideline or beacon their path towards it. Strategy adopted by retail chains are critical as they are the lifeline of the society and in many ways depict the choices made by their suppliers, customers and management. Let us observe how Himalaya Drug Company has positioned itself to achieve competitive advantage through its marketing strategy.

1.2 The Himalayan story

Himalaya Drug Company's marketing strategy can be defined as one of the most detailed yet fundamental in the modern times. Himalaya's marketing strategies are based upon a set of two main objectives that have guided the firm through their growth years. Shift from focusing Ayurvedic concepts to herbal personal care was a major strategic decision. This was done mainly to appeal the international markets. "Just old wine in a new bottle" is the typical reaction one would expect at Himalaya Drug's move to rechristen its personal care range Himalaya Ayurvedic Concepts to Himalaya Herbals in December 2003. The brand rejig has also been accompanied by a packaging makeover towards an international look. This is the second time that Himalaya has undertaken a brand readjustment exercise. Himalaya's personal care range was introduced in 1999 under the brand name Ayurvedic Concepts. In December 2001, in a move to leverage Himalaya's brand equity, the company brought the Ayurvedic Concepts brand name under the Himalaya umbrella. And now, barely two years after the previous renaming, the latest move has raised questions as to why the company is making such a conscious effort to reinvent its personal care brand?

"We could have switched directly from Ayurvedic Concepts to Himalaya Herbals in 2001 itself", said Soumitro Banerji, Executive Vice President, Consumer Products, Himalaya. "However, it was a transitional 'handholding' phase where it was necessary for consumers to associate the Ayurvedic Concepts range with the Himalaya brand name". He insists that the umbrella branding remains and this time around, the aim is to create a unique "head to toe" brand. The personal care range has 40 products spanning hair care, skin care, body care, health care and oral care.

The complete re-branding exercise and reorientation in the marketing strategy worked out well and Himalaya is considered one of the best brands in the personal care segment. Recognising the need to be acceptable to the affluent yet traditional segment was one of the best steps taken by the company.

1.3 Use of information

Having a message that would conjure an excellent brand image is easy but getting the same across your channel of distribution and to the end consumer is a Herculean task. Apart from that having the consumer buy into your story and use a prduct is even more difficult. This is some thing Himalaya managed to do extremely well.

"Our brand positioning that Himalaya's products are scientifically tested, efficacious products remains the same," said Banerji. Targeted at the urban audience, the refurbished range has new products such as protein shampoos in the three variants- Normal, Dry and Oily hair; fruit packs, mud packs; dental cream and a nourishing skin cream. The last, the company claims, is a one-of-its-kind product in the market.

To induce trials of their new protein shampoo variants, the company is renewing its thrust on sachets. Also, Himalaya brought out a 40 ml bottle with the idea that a consumer would try a shampoo 2-3 times before deciding whether to go for it.

Scientifically backed data was used to induce trails and armed by marketing feedback which said trails were important for the brand to move on, the project was now to concentrate on informing the consumer that these products actually work. The first hurdle was the retailer who had to be convinced first. Himalaya then used information about the scientific validity and other studies to the retailers and helped them understand the usage of its products. The sales figures from markets across the world were published and many research reports were made available to them. This helped the retailers understand the veracity of the products and helped them push the products. The same reports and studies were made available to the end consumer which helped them win his confidence over. Thus information was used to ensure that their marketing strategy was hitting the target.

1.3 The global context

Success of Himalaya is also a contribution of their capability to see the big picture or the global context in understanding what their positioning should be as well as how to align themselves to the need of the hour. This global context helped them to enter and seize a sizable market share in over 28 countries. It can also be attributed to the fact that they concentrated on a single business strategy. Single business strategy has achieved tremendous success over the eighty years without relying upon diversification to sustain its growth and competitive advantages.

1.4 Global yet local

An adaptation of products, packaging and positioning was done to suit the local customs, cultures and legal procedures. The local cultural differences were also observed. This helped in creating a local strategy to an advantageous stance as the customers found the products appealing yet the message and the positioning of a global brand was intact. This shows how a combination of strategies were used to appeal to the local audience while retaining the global contextual image.

1.5 Local yet global

Leading marketing strategies of Himalaya are high quality, wellness, and uncompromised service with a smile. They are able to give deliver the products needed by the customers at all times by maintaining high standards and working as a global workforce. All the decisions in terms of products, packaging, branding was similar across markets. Customers were ensured that the product they were purchasing in stores in Lithuanian market were similar to the ones sold in New York. The employee policies and HR practices were also maintained to meet the global context and developments in the pharmaceutical world were tracked and Himalaya adapted the strategies of leading businesses to redefine and reorient itself to match their moves.

1.6 E-business as a part of strategy

As in today's major organizations, e-business is imperative for Himalaya's continuous growth. In fact Himalaya is one of the pioneers of the companies that have a presence on the World Wide Web. At Himalaya e-business is not just another function but a critical one at that. It acts as a binding factor for all processes and ensures that deliverables come in time, all the functions are inter connected and consumer's can get in touch directly with the brand, send complaints or feedback and have all the information he needs at a point. The website interface is very nicely done with the major denominator as the

Leading is a major part of e-business. One must establish a direction before one goes down that path. Himalaya decided to go in the direction of an online store. This enabled customers who preferred online shopping to purchase what they need from the store online. This has been a very successful element in Himalaya's over all business, especially during the last 6 years.

1.7 The Internet band wagon

There are a number of reasons for Himalaya's tremendous success, not the least of which is its use of the Internet to supplement its retail presence. As Himalaya has been around for 80 years much before the Internet was invented and the need to be present online was felt, it had to adjust to the new technology and adapt its strategy to suit this new medium. So Himalaya eagerly embraced technological advances in marketing and supply chain technology and is now enjoying the benefits of doing business over the Internet. Because the Internet's effect on productivity is still in the early stages, the ultimate impact on Himalaya's mega-billion sales has yet to be seen, but it is certain that the numbers will only go higher. More than numbers it provided a global presence and varied clientele.

Planning in an organization that utilizes e-business can be very time consuming. It is notable that management considers additional marketing and advertising strategies for their web consumers when creating and revealing products. Like most major corporations, Himalaya's website that allows one to view products in detail before purchasing along with their detailed research reports, technical evidence about its usage and other important information. All aspects of the products, policies, purchase procedures, and etc are made crystal clear. In e-business it is imperative to have a system as such. Though there is no actual human contact, a customer must feel comfortable making decisions on his or her own.

The controlling function of an e-business is what allows everything to operate smoothly. When "controlling" an e-business it is important to have professionals that understand how the system works. Himalaya has information technology experts that monitor the system to guarantee that the site is functioning properly and provide online assistance should a problem arise.

They have also recognized that integrating the online and offline channel is one of the greatest values and its offline business would always compliment its e-business strategy. With this integration, leveraging on its massive offline presence to compliment Himalaya's e-commerce operation, it's one of their biggest strength.

Though most of its sale happens at the retail store, Himalaya did not only embrace the e-business strategy but also understood that many online shoppers checked out their products and then remembered to pick them up when they walked in to the store.

Task 2: Marketing strategy options @ Ford

The automobile manufacturing trade presents an interesting and important microcosm of American business as a whole. The general public opinion is that American manufacturing in general is faltering-that decreases in worker productivity and product quality, stiff competition from foreign concerns, increasing domestic labor costs, a diminishing loyalty among consumers for U.S. made products, and other factors are causing a subtle shift in our entire economy. Americans just don't build the best products, or so says the current school of thought, and the future of the U.S. economy lies not in manufacturing, but service sectors. To the casual observer, nowhere is this opinion more valid than in the American automotive industry. It is common knowledge that domestic carmakers are struggling, and have been for decades. In addition to this, competition and other outside forces reshaped the landscape of the U.S. auto market.

Ford motor company has already lost market to many far east motor companies like Hyundai, Honda, etc and its own country's competitor GM. Ford's management have followed many strategies to get FORD back to track and takeover its competitor's position in the market. But it is all in vain. Still FORD is making huge losses in spite of its marketing strategies.

Some of the strategies followed by Ford in the recent past are,

2.1 Slogan Rotation

Ford has always been a more sales-driven company than most. Ford has always been a move-the-metal company, even if its legacy as having invented the auto assembly line has sometimes obscured its marketing creativity.

Ford changes its ad slogan and brand strategy every 2 years or so. The exception is "Built Ford Tough," which is been successfully followed in the Truck business.

The automobile manufacturer has come long way in promoting the car side of Ford's business. Ford's current slogan, "Built for the Road Ahead," followed the balky, "If You Haven't Driven a Ford Lately, Look Again," which lasted two years and followed "No Boundaries," which lasted less than two years. Hence Advertising and brand strategy at Ford has always viewed as disposable many times.

2.2 Brand led marketing strategy

Another strategy that FORD used in the last five years is the brand led marketing strategy. FORD had debut the Television advertisement during the UEFA Champions League final between Man United and Barcelona, to tie in with Ford's sponsorship of the competition.

The advertisement featured the FORD models, including the Ford Focus, Mondeo, Fiesta, S-Max and Kuga. Each of its model is filmed in a studio to seem as though it is moving, to emphasize the 'kinetic' qualities of the car design. The advertisement mainly focused on 'Ford kinetic Design' considering manufacturer will return to some model-specific advertising, the new brand-led format will feature in the majority of future communications. FORD's global AD agencies, Ogilvy London, Mindshare and Wunderman, have been instrumental in making the advertisements a success.

2.3 Revitalizing the product line up

Ford's management concentrated more on revitalizing the product line up, now marketing and product design have to work together, so the Ford brands register strongly with customers once more. "You would be hard pressed, I think, to find a link that connects Ford cars and trucks together in the consumer's mind, or to pin down what Ford cars stand for, and we're out to change that," he adds.

While the redesign of Ford's F-Series pickup, launched in 2004, has been well-received and has boosted sales, and the redesigned Mustang has been a huge hit with no incentives needed to sell it, the Ford Five Hundred sedan and Freestyle crossover SUV/wagon have been disappointments.

But customers are not getting an idea what Ford passenger cars are all about anymore. Ford cars were meant to replace the Taurus and compete against the Toyota Camry, Honda Accord and others which have been claiming to be the best selling sedans in the World.

Reference: http://www.businessweek.com/bwdaily/dnflash/jan2006/nf2006015_9292_db035.htm

2.4 The turnaround strategy

Marketing Strategy of Ford Motor Company was built on superior products and that still exists today. First and foremost, Ford as to transform its marketing function as it did in North America where it they first repaired the relationship with dealers. The culture was confrontation with the dealers; that was the first thing they worked on (to repair the relationship). By integrating public affairs into marketing, it was separate earlier, so by integrating they were able to do things in marketing that they couldn't do earlier. Hire a good PR with a decent budget in marketing and try to see that it pays off. Ford can make a choice among the following strategies to re-enter the market. Those strategies are as follows

Reach The Customer:

Ford has to pursue a customer engagement strategy to try and create value by transferring valuable competencies that the customer needs to its design. Especially n the recessional times, customers are very choosy and have so many preferences like high fuel efficiency, safety, low price, etc. These pointers can be used to position its product offering to suit the needs of the consumers. This helps them to take on indigenous competitors who lack those competencies and products. Bu including the customer in the value creation process and by transferring differentiated product offerings, Ford can practically reach the customer.

Innovation Strategy:

Accordingly, Ford should try and create a centralized product development function which aims at creating models for the future. Opt for customization of the offering as per the local customization requirements and marketing strategy, this tends to be rather limited to scope. Ultimately, in most international companies the head office retains tight control over marketing and product strategy to work towards innovation and change.

International Strategy:

An international strategy makes sense if a company has a valuable competence that indigenous competitors in foreign market lack and if it faces relatively weak pressures for local responsiveness and cost reductions. In such circumstances, the international strategy can be very profitable. However when pressures from local responsiveness are high, companies pursuing this strategy lose out to those that place a greater emphasis on customizing the product offering and market strategy to local conditions. In addition, because of duplication of the manufacturing facilities, companies that pursue an international strategy tend to suffer from high operating costs. The above discussed point makes the strategy inappropriate in manufacturing industries where cost pressures are high.

Global strategy:

A company pursuing global strategies focus on increasing profitability by reaping the cost reductions that come from experience curve effects and location economies; that is their business model is based on pursuing a low cost strategy on a global scale. The production, marketing and R&D activities of companies pursuing a global strategy are concentrated in a few favourable locations. Companies pursuing global strategy try not to customize their product offerings and marketing strategy to local conditions because customization, which involves shorter production, runs and then duplication of functions, raises costs. Instead they prefer to market a standardized product worldwide so that they can reap the maximum benefits from the economies of scale that underlie the experience curve.

This strategy makes most sense when there are strong pressures for cost reductions and demand for local responsiveness in minimal. Increasingly, these conditions prevail in many industrial goods industry.

5. Transnational strategy:

The strategies that we have just looked at all have downsides. An international strategy can increase costs and put a company under threat if low cost competitors emerge. A global strategy can give a company a low cost advantage, but the strategy may not work if customers do not appreciate and value globally standardized products and instead turn to the more customized or differentiated products of rivals. What strategy can a company pursue, to avoid these problems? This is one of the most complex questions that large global companies are grappling with today. Company like FORD are trying for decades to come up with the "perfect" strategy that will give them a competitive advantage in the global arena. Ford has repeatedly changed strategy to try to raise its profitability; so far, it has not succeeded, announcing huge losses in 2001 from failed global ventures. Although the perfect strategy will be specific to each company and must be aligned to its particular business model, some researchers do offer guidelines for companies seeking to maximize their profitability in the global market place.

2.5 Conclusion

Though it is very easy to propound solutions to the problems that Ford has seen, it is evident that the brand lacks action and is considered 'tired.' So the primary concern of Ford is to create a set of reaction able processes that would continuously exploit its cost economies and location economies, transfer distinctive competencies within the company and pay attention to pressure for local responsiveness. It should also look at maintaining that the flow of skills and product offerings to suit its innovative and qualitative brand image. Still there are people who trust your brand and Ford has to ensure they are satisfied or as they say when you have no fans, your career is as well dead.

References:

Charles W.L. Hill and Gareth R. Jones, Strategic management, An integrated approach, Sixth edition, Indian Adaption(2008)

http://www.allbusiness.com/marketing-advertising/advertising/3877648-1.html

Task 3: Implications of changes in marketing environment for organizations

As the adage goes, change is the only thing that is constant. Avoiding the changes is not always possible. How organizations respond to change and adapt themselves determines the success or survival for future. A look at the airline industry across the world shows how change effects the environment forcing marketing strategies to be molded to suit the new rules of the game. A highly volatile market increased the uncertainties which made it more risky to take chances. The difficult times seem to be over but the effects are still lingering all around. The aftermath of the financial tsunami has left few survivors. These are companies which formulated methods and marketing strategies to survive and in the process win. This ability to adapt to the changing environment is what should be the path to survival.

3.1 Airline Industry Introduction

One of the industries which suffered most in this downturn is the airline industry. Across markets financial loss, stock market debacles, increasing fuel surcharge, etc. reduced the chances of profiting. Mounting debts due to increased fuel charges, non-cash exceptional charges, decreasing frequency in travel aided by technology that threatens to decrease the need to cross waters to meet and travel push marketing brains to think harder and innovate. Companies with deep pockets could withstand for a while but ended up increasing the prices and transferring the burden to the end customer. Pushed to the wall, companies responded by eating out of each other's share while trying hard to retain theirs. This led to a cutthroat competition and with new offers, discounts, packages arriving everyday, the customer had the choice to choose between EasyJet or BA depending on what would save him more and fit his budget. To assess the impact of these changes let us look at the situation with the help of Porter's generic strategy on the dimensions of strategic scope and strategic strength and how airline industry responded.

Usually the rules of the game in the airline industry can be classified into two: the differentiator who has the distinctive features, services, comforts and ends up with high price tag and then there is the cost-leader catering to the mass segment of the population who don't mind comparatively lesser comforts as they would be paying a much lower price. Both the segments cater to the perceived consumer value about the service. Across the world customers found themselves queuing up more often in the cost leader's aisle for traveling than the differentiators for obvious reasons. There were no more approvals for fancy bills submitted nor was the paycheck conducive to pay the differentiator. This saw the differentiator panic as they were losing altitude and this could only mean more empty seats than filled ones. So the reactor strategy was sought out and the response was to reduce prices, increase the offers on the services promising which the differentiators felt they could continue to attract their target segment. To some extent this proved to be successful but the frequency of the travel or the chances of repeat travel was not that good.

3.2 UK Airline industry scenario

In UK the changes have been quick but visibly left the scope for improvement and made the vertical sojourn harder and competition higher. Almost all airlines incurred huge losses and some continue to do so even now. EasyJet saw its profits drop as much as 65% over the last few months and was expected to drop even more. Here is when EasyJet found concentrating on what customer's attitude is towards the company, its service category and the competition. After evaluating the attractiveness of potential target markets, EasyJet responded by softening the impact of rising fuel costs and it has worked. EasyJet's revenue per seat rose 11% in the year to September, to £50.47. Exchange rate movements (easyJet benefits from a strong euro) flattered the comparison but even the 4% increase at constant currencies is a remarkable outcome in a recession. By changing the prices of the ad-on bags carried by passengers which customer's didn't mind easyJet was successful in ensuring that its planes were 85% full. This shows how by studying customer's attitudes and preferences companies can work towards attaining their strategic goals by focusing on the preferences and the perceived value. Other companies like BA, Iberia have responded with mergers and acquisitions to seal a safe market in the future. Though the airline firms feel safe the focus is still on how soon they will be able to limp back to normalcy.

3.3 Where integration is the key

Private label popularity is challenging the reign of popular brands leaving their manufacturers in a dilemma. Sales of own-brand goods in its stores are increasing at twice the pace of those of branded products. How should marketers of the famous brands insulate and change the adversity, to recover is the big question.

Brands across the world have moved on to adapt or perish mode. A revolution spreading the landscape has pushed firm's across the world move on from brands that have been commanding high price pent on branding, marketing, attractive packaging to own, in-store brands that have given almost the same quality yet remaining with in the price range where the consumer doesn't mind paying as long as he gets the quality he is expecting. In store brands dot all the shops across categories. European brands have responded heavily by discounting their products, offering more for the same prices or less. This helped only attracting consumers who were looking for brands but were guarding their money. These were marginal purchases but were good enough for the brands to stop their downfall. But they soon realize this cannot be one for a longer run.

3.4 Diversification

To answer the question if they should opt for diversifying and producing more brands or adapt their present offering to suit the consumer's needs, one should look at what the consumer wants. People's attitude has changed. It is not a bargaining game any more between which brand consumers are going to purchase. It s what the brand has to offer the consumer as the strings are tighter and the budgets are lower. What do manufacturers do to reach the expectations of the consumers?

The solution seems to be in adapting the brands to suit the consumer's attitude and requirements. The new world of change need not unsettle us, so long as the manufacturers are willing to understand the end consumer's demands and rethink their products and services and ways of coming to market. The secret seems to be in making the customer stay loyal and trace his or her steps back to buy our products. This is defined as "an act of binding the customer - intellectually or emotionally - to a course of action." If a product or service meets buyer's needs at the first occasion, and is offered at a fair price, that buyer has compelling reasons to come back for more, in a quest for "value" that suits him. The "value" needs to be continuous and regularly meeting the customer's expectations. The focus is not just on the tangible but the intangible aspects of customer emotional bonding which supercedes the quality or price for that matter.

3.5 Factors effecting Consumer Psyche

The easiest way in approaching the consumer is to maintain the basic differentiators that impact the consumer's psyche.

Just excellent quality is no longer a differentiator

Low prices alone are not a differentiator

Excellent service alone is no longer a differentiator

Customer satisfaction is passé

In order to achieve customer loyalty the manufacturers and marketers should work on a concoction that delivers all of the above four points in the right mix and allows them, not just to meet but to exceed the expectations of customer's across the segments.

On the other hand coming out with new brands that would directly cater to the changing psyche of the consumer could also be done easily. This would give more flexibility to the marketer as well as make it easier to communicate the message to the end consumer instead of molding an existing famous brand to suit the change. Take the case of 'Ola' which is a premium coconut oil brand in India for example. In case of premium positioning the company found that 'Ola' was placed safe enough but the volumes were a problem. This is when it started to look at the mass market. Instead of dropping prices or tampering the existing brand image of its premium brand, it found a beneficial target - bulk sales for the mass market and introduced a different variant called 'Super' targeted at the mass audience. This also assured minimum volumes to keep the firm going which allowed them to have the premium brand stable. Though this started as a survival strategy in one of the strongest consumer markets, it turns out to be the most profiteering as it satisfies all the four components along with few others and reaches out to consumers across segments.

This would also mean that the famous brand can retain two different categories and play around. What the manufacturers need to be particularly aware of is why, how, when, and to whom to deliver extraordinary perceived consumer value.

3.6 Conclusion

Change or die is the code of honor. Companies must recognize that increases in the price of products outpaced commodity inflation during the last year, which has resulted in higher profits. However, previous price hikes didn't completely cover escalating production and commodity costs. Commodity prices "are still well above historical averages," which is a negative sign. But the fact of the matter is that the end consumer is bleeding and cannot squeeze more for your brand unless you give him/her a combination of the factors he is looking for which are discussed above. Aiming at customer loyalty is what differentiates the brands that survive and brands that collapse in the downfall. Companies that are able to get what they want from the consumer, who in this case is a deeply effected by financial market strokes is to be innovative and convincing him that it is ok to spend on your brand as you have molded yourself to reduce your costs, increase the quality and that this new Ford is better than the last one. All brand manufacturers should understand that post recessional hurdles are mainly due to trust and the easiest way to cross them is to gain it.