Corporate Strategy & Marketing Strategy
Corporate strategy involves working in an industry and striving to make more money, usually by retaining customers and gaining new customers from competitors. To gain customers from competitors, business need to seem as though they have better quality and higher value. This is where marketing strategy comes in, using research in consumer behavior to identify needs and produce messages that tell consumers how the business's product is better than competitors.
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Types of Corporate Competitive Strategy
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In a low-cost strategy, the business strives to consistently achieve lower product prices than competitors. Broad differentiation strategy means attempting to appeal to more types of people than competitors by describing all the ways the product is different and superior to the competitor's product. Best cost provider strategies attempt to provide the highest quality for the lowest cost. Focused strategy, also known as niche-market strategy, seeks to out compete in a smaller segment. The niche-market strategy has two types, one based on low cost and other based on differentiation.
The Value Chain
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Corporate strategy and marketing strategy become linked in the value chain, which is the process of creating and marketing a product that people want. The first link in the value chain is "market-sensing," the process of using research to identify who might want to buy the product (the target market) The next link in the value chain is "new offering," during which the product is researched, developed and created to meet the specific needs of target market members. "Customer acquisition" is next; this link encompasses advertising activities aimed at attracting target market members. "Customer relationship management" follows up acquisition by ensuring that existing customers remain happy and loyal to the product. Finally, "fulfillment management" deals with logistics, shipping and payments.
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Core Competency
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Core competencies are the fundamental qualities that make a company different from competitors. To qualify as a core competency, a business quality must fulfill three criteria: it must be a source of competitive advantage to the point of differentiation, its appeal must apply to many target markets and it must be hard for competitors to imitate the competency. Businesses develop core competencies as corporate strategy and advertise them as marketing strategy.
Strategic Business Units
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A corporation's strategic plan encompasses activities such as defining the company's mission, establishing strategic business units (groups responsible for various strategic functions), allocating resources to the units and assigning opportunities for growth. In many large organizations, marketing strategic business units develop marketing strategy in line with the corporation's overall strategy, value chain and core competencies.
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References
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