London College of Accountancy and Management

EXTENDED DIPLOMA LEVEL 7

Unit 7 : Strategic Marketing Management

Submitted TO: Sabir Hussain Jafri

Submitted BY : Malik K.S Awan ( PB10439)
Programme: BTEC Extended Diploma in Strategic Management & Leadership

INTRODUCTION TO THE UNIT: This unit gives the knowledge on how to establish the marketing plans and implement the possible principles in the organizations for maximum profit and business growth in the everyday changing business world. This unit gives the theoretical information and study of the strategic marketing processes. Unit facilitates the leaders to formulate and apply the marketing plan for the betterment and positive acceleration of the organizations. The explanation of the theoretical concepts and their relationship with the marketing strategy and the process is provided in this unit for the progressing companies. INTRODUCTION TO THE ORGANIZATION: This chain was founded by Jack Cohen in 1919 and was like a shipment of tea and from tea, the first two alphabets were taken like T.E. in the Stockwell and then putting these all together T.E.S. and then CO was added to that and then it finally became Tesco. The first store was opened in 1929 in Burnt Oak, Edgware, and Middlesex. During the 1950s and 1960s Tesco grew organically and also through the acquisitions after it opened about 800 stores. The spatiality was food and drink but after certain time it diversified into the areas like clothing, electronics, financial services, home, health, car and dental insurance. It also retailing and renting software and became the largest British retailer by both global sales and domestic market share and the most encouraging aspect of this largest retailer is this that the profit exceeded 3 billion, became the third largest global retailer based on revenue after Wal-Mart and Carrefour. Tesco PLC is the largest retailer business which employees 4, 70,000 people and owns over 4340 superstores. The annual sale for the year 2008 was 58.1 million pounds and the sale for year 2009 was 59.4 million pounds. These results show the exact position and health of the organization with the remarkable progress. TASK. 1.1: STRATEGIC MARKETING: Strategic marketing is the important and significant aspect in the business world. Multinational companies put their maximum efforts to promote the marketing throughout the world. Marketing alone does not give the real image of the whole
London CAM Page 2

theme but he word strategic makes it more authentic and reliable tool of promoting the business in the whole world. If the marketing is not launched with the strategies then it will dead, so the strategic marketing makes it perfect to promote the business in the better and ongoing progressive methods. Proctor (2000) opines that the strategic marketing is the method of satisfying the customers for their needs and demands and wants as well. Although there should be the transparency and authenticity in the marketing where the competition is also present surely everywhere in the organizations. All this happens in the marketplace so it is not the simple but surely the progressive and impressive way of introducing the products with the best logic and strategies to beat the competitors and meet the goals in the superb and professional method.

PLANNING PRINCIPLES OF MARKETING STRATEGIES: Strategic planning can be said like the effort to create the feasible decisions and actions which position and lead the organization in terms of the business of the collective efforts in making the difference in the business. It gives the guidelines to the authorities where the organization is poisoned and where it has to be after the marketing strategies which they are going to launch in the specific time for the organization. Matketdeveloper (2010) opines that the Systematic Approach is the fundamental planning principle in the marketing strategies in the corporate settings. If the companies get the true picture of the planning according to the systematic approach then it covers the following areas for the advanced and professional decisions in the organization for growing in all dimensions. First of all the companies must plan the approach with what they are going to implement the new marketing strategy. Then this is very important that there should be the clear idea what the company wants from each stakeholder. Without knowing the real goal and target it becomes impossible to meet or get that. So the companies must aware of the goals. The main theme which is also known as the message when marketing is done by the related staff must be clear and transparent for the customers. The communication between the organization and the customers is also known as the marketing. So the communication should be effective and reliable. Brassington and Pettitt (2002) states that the Resource Requirements are the basics of the marketing because the
London CAM Page 3

marketing depends upon the resources which must be provided for the purpose of marketing of the products in the companies. So the resources are always welcomed and appreciated for the better publicity of the products of the companies. Apple Inc, spent hundreds of thousands for the marketing of the new invention which is known as the Ipad. The world after knowing about this product became the fan and it demanded by the public or customers in a massive quantity around the world. This is called the true marketing which is only possible with the sufficient funds and resources of the particular organization. So although there should be the quality, brand, availability, innovativeness and invention but the significant factor that enriches all the aspects is the resource requirements. So companies do their best to promote their business with the resources they have and they more they sow in the marketing the more they reap in the form of the profit after the sale. TASK 1.2: TOOLS AND TECHNIQUES OF MARKETING PLAN: To produce the marketing plan there are certain tools and techniques which are always considered while making these decisions in any organization of the business world. The first tool which is used in the marketing of the organizations is the BCG Model. Maxipedia (2010) states that BCG model has four specific aspects in which this model can be completely described. Now BCG matrix is based on the product life cycle theory and is used to determine the priorities to be given to the strategic business units. To ensure long term growth a company should have products with high growth and low growth with high market share. It will ensure the availability of cash that would fund other strategic business units. BCG matrix has quadrants namely Dog, Question mark, Cash cow and Star which rank the products on the basis of their performance in the product portfolio. In this model question mark describes the initial position of the business and the next one is the star which is all about the high rate of market growth but less rate in the market shares and then the cash cow comes in the screen which helps the organization to know the continues profit with the sustainability in the organization which gives the regular profit from the investment and then the last one is dog which shows the ending point of the business. This is known as the BCG Model of marketing. The second one is the SWOT analysis. Hatton (2000) states that it is a tool used to audit an organisation
London CAM Page 4

and its environment. The acronym SWOT stands for Strength, Weakness Opportunity and Threats of a company. The strengths and weaknesses are factors internal to the company and Opportunities and Threats are external factors. This is very important for the organization to have swot analysis in making plan for the marketing because this is the tool of marketing for the companies. TASK 1.3: BCG MODEL AND PRODUCT LIFE CYCLE (COMPARE AND CONTRAST): Maxipedia (2010) sates that the BCG has four different stages in the whole process of marketing of the product. It is a tool used to audit an organisation and its environment. The acronym SWOT stands for Strength, Weakness Opportunity and Threats of a company. The strengths and weaknesses are factors internal to the company and Opportunities and Threats are external factors. Romninos (2002) suggests that the Product Life Cycle is the process in which a new product goes through the different stages like introduction, growth, maturity and the decline. It determines the product value in the marketing through different stages in the product life cycle. This gives the very common pattern of the sales which helps to know the life cycle of the product of any company. Now if we compare and contrast the BCG and the Product life cycle then we come to know that the BCG gives the stages of the organization from the very initial stage to the very ending point. The four beautiful stages have been considered in this model which is all about the general information of the organization but if we look towards the PLC then we understand that this is more concerned about the precision because to give the exact life period of the product is almost impossible and unpredictable and the sales level is also in the realm of imagination. So the BCG gives the very close position of the company than the PLC. Secondly, the BCG covers all the products but in the PLC, some products do not follow the usual shape of the PLC. In the similarities or compare there are four almost common stages in both of these models. The question mark to the introduction, the star to the growth, the cash cow to the maturity and then at last the dogs to the decline. These are the similarities of both of these models.

London CAM

Page 5

TASK 1.4: COMPARE AND CONTRAST OF PORTERS FIVE FORCES AND SWOT ANALYSIS: In the tools and techniques for strategic marketing there is an important and significant model which is known as Porters Five Forces Model. Learnmarketing (2010) opines that this tool is used to analyse if the product or service has the potential to be profitable. The factors taken into account are Bargaining power of the Suppliers, Bargaining power of the customers, Threats of new entrants, threats of substitute products and Competitive rivalry within an industry. These five forces determine competitive power in the business position in an industry. While the SWOT analysis according to the Valuebasedmanagement (2010), it is a tool used to audit an organisation and its environment. The acronym SWOT stands for Strength, Weakness Opportunity and Threats of a company. The strengths and weaknesses are factors internal to the company and Opportunities and Threats are external factors. Both of these models have many similarities, the first one is the strength of the swot has resemblance with the bargaining power of the customers and then the threats from the swot has closeness with the threat of the new entrants and it is not an injustice to say that these both are the same factors. But the opportunities in the swot is not mentioned in the porters model so this is the only contrast in both of these models.

London CAM

Page 6

TASK 2.1: PORTERS GENERIC STRATEGIES: Porter (1980) states that the methods of providing the categories of various kinds of competitive strategies are identified by two strategies and both of these are named the generic because of their applicability of any type or form of the business in the progressing organizations. These two types are called the Lower cost and the Differentiation which are given by Michael Porter (1980). The lower cost is representing the companies that are more successful and have high rate of sales and profitability as compared to the other companies of the same industry. These organizations can develop, produce and sale their products in the very smooth way for the better profit and sustainability of the organization. There are different organizations that make the pieces very nominal so that the customers buy their products consistently. In these types of organizations in the Britain there are many like Sainsburys, Iceland, Aldi, Poundland, 99p shops and LIdl. These organizations reduce their prices in order to get the more sale and the profit increases in the same way as well. This is called the lower cost or cost management. On the other hand,

Businessdictionary (2010) states that the differentiation is the one which has its own uniqueness and some type of superiority and it does not cover the cost and the cost is not matter for these kinds of organizations. Some companies with good and unique style become brand and people just love their products without any logical justification. There are so many products which are just famous for their brands. The quality matters in these organizations and when they put their trademark then it becomes the unique and lovable by the market and the customers. The example for the differentiation is the NIKE, Adidas, Apple, SONY, M&S and JD in the whole world. These are some of the brands that attract the customers and make the difference in the choice of the market, so this is called the differentiation. In Tesco, we believe in the quality and uniqueness in the affordable cost is the best marketing strategy. We are pressing forward for both of these and doing our best to have right balanced strategy of both dimensions.

London CAM

Page 7

TASK 2.2: General Electric Model is the one of the tool to perform the business analysis in the organizations and this is the criteria to check the status of the business of any progressing and growing organizations. Businesstools (2010) opines that the general electric model is a nine cell matrix which is taken into the organizational strategic structure to perform the business portfolio analysis as a strategic initiative towards the planning process in the organizations. The GE matrix identifies the optimum business portfolio as the one of the suggestive options that fit nicely and perfectly in the companys strength and help the organization to take advantage from the most attractive sectors of the company. The main target of this analysis is to position the each strategic business unit (SBU) which definitely depends on the strength of the SBUs and also the attractiveness of the industry sector or the market on which is focused. Each axis is divided into low, medium and high that give the nine cell matrix as depicted below.

The next one is Shells Directive Policy Matrix which is another refinement upon the BCG matrix according to the Fifield (1998). The matrix can be described in this way. The horizontal axis represents the business sector profitability and the vertical axis is a companys capability to compete the other organizations. As we know that the general electric matrix the position of the SBU in any cell represents different strategic decisions. London CAM Page 8

The decisions always have the option to change the position and they are not in the box shape and sometimes they blend into each other. The matrix is given as follows

The divest box describes the position of the organization in which the cash flow goes worst and uncertain. This situation is unfavorable for the organization. The second one is phased withdrawal. These are the SBUs which are weak and less profitable and these can be phased out with the time in order to invest the cash in the more profitable ventures or projects of the organizations. The third one is the double or quit. In this box it shows the areas where there is a gamble on the main SBUs for the future. It is debatable in this situation the investment should be increased or stopped. In the fourth box it says the Custodial in which the SBUs are like the cash cow in the organizations. It provides the organization what it demands but there are not any more resources in this situation. Try harder is the one in which SBUs could be capable and good enough over a longer period of time, they require the additional resources to enhance their power to sustain. Then there is the Cash generator which is also like the cash cow. The SBUs can continue their operations in order to generate more and more cash flow so that the company may progress. Next one is Growth the SBUs increase the market by just using the present and enough resources. But they need funds to grow in all dimensions. Market Leadership in most of the resources is focused on the SBUs and there has to be the priority made by the organization. Both of these models are really helpful ti make decisions and to have the knowledge about the organization, so Tesco is using both of these models in the different sectors for the betterment of the organization.

London CAM

Page 9

TASK 3.1: CHANGES IN THE ORGANIZAITONS: Organizations change their conduct with the time in order to have the successful results around the globe. Change is the only constant in the world. The constant success based on the change of the conduct. Changes are mostly arranged in the three different sectors like structure, technology and the people. Ackerman (1997) states that there is distinguish between three types of change like developmental, transitional and the transformational changes and all these are very common and effective in the organizations. There can be possible changes in the shift from supply to demand environment which is the changing order of supply of the production according to the demand from the market and the customers. If the changes are implemented then there has to be the strategy in applications and processes. There can be changes in the fashionisation of the markets which means the changes in the fashions and styles of the market which change with the time and very important for the organization to accept the challenges and get them done in time and perfectly. There can be rising expectations in the market and the micro markets are also very common changes. There are also the changes in the technology to improve the qualitative production and durable sustainability. Some very effective and significant changes are in the competition in terms of getting globalised, importance of the services and erosion of the brands in the organizations. Easterby Smith and Araujo (1999) opines that the learning organization was there for the decades but in the 1990 it became very popular and the interest of the scholars and the organizations increased in this year and after that it just flourished in the industries and became common in the organizational success. The changes can be implicated by the organizational learning or the learning organization which means the one that promotes, appreciate and then implement the learning environment for the development of the staff and the mature understanding for the changes in the organizations. Mintzberg (1989) opines that the Strategy is one of the implications of the change which is the systematic approach in order to handle the obstacles and tackle the challenges come from internal or external bodies. The companies must have authentic and working durable strategies in all the departments like production, sales, marketing and so on. If the companies adapt the realistic and feasible strategies then the goals can be achieved and the targets can be done within the gives timeframe. Changes can be implemented without or very minor problems come in the pace of the success from the organizations in order to become global and have the brand name around the globe. These are the implications of the changes in the organizations. The companies must have and adapt the effective and authentic ones according to their needs and demands.

London CAM

Page 10

TASK 3.2: CHANGES IN THE MARKETING ENVIRONMENT: Easterby Smith and Araujo (1999) opines that the learning organization was there for the decades but in the 1990 it became very popular and the interest of the scholars and the organizations increased in this year and after that it just flourished in the industries and became common in the organizational success. Tesco is the organization that highly recommends the learning in all the departments because this is the result oriented company that believes in the constant success and reliability of the trained and developed staff and leaders everywhere in the organizations. Tesco arranges the training program quarter a year and provides the environment in which the staff can gain the knowledge and wisdom to deal with the challenges and the obstacles. Tesco focuses on the staff building and the trained leader development in every department and in every store around the globe. Secondly, Mintzberg (1989) opines that the Strategy is one of the implications of the change which is the systematic approach in order to handle the obstacles and tackle the challenges come from internal or external bodies. Tesco does has the suitable and working reliable systematic and strong strategies in order to get the tasks done and these strategies are always with the alternatives and options. Incase if some particular strategies do not work then there can be the next steps to be taken by the authorities for the better growth and success of the companies. So Tesco is the progressing and well established organization marching towards the destination to be the number one in the whole world.

TASK 3.3: FUNCTIONAL AREAS IIN MARKETING OBJECTIVES: Christopher, Payne and Ballantyne (2001) suggest that marketing demands healthy relationships and strong bonds with each other in all dimensions because the marketing cannot be successful without the implication of the functions and changes in the organizations in order to get feasible relations with other organizations and other firms for growth and the sustainability. Mintzberg (1989) opines that the Strategy is one of the implications of the change which is the systematic approach in order to handle the obstacles and tackle the challenges come from internal or external bodies. The strategy helps the organizations to have active functional areas for the changes and the effective steps in the organizations. Then there has to be the learning environment in the organizations so that the organizations may have the clear and feasible system in which the staff can be trained and developed by the leaders and the mentors and coaches. Easterby Smith and Araujo (1999) opines that the learning organization was there for the decades but in the 1990 it became very popular and the interest of the scholars and the organizations increased in this year and after that it just flourished in the industries and became common in the
London CAM Page 11

organizational success. This shows the effectiveness and the implications of the functional areas in the organizations. So Tesco is having the learning techniques and strategies to cope with the hurdles and get he tasks done in time and get the desirable position in the everyday changing business world.

CONCLUSION: This unit covers the marketing strategies and the implementations of these for the constant success of the organizations in the business world. This unit gives the deep study on the changes and the implications of the changes in the companies. this unit has the powerful and authentic study on the marketing functional areas and their significance.

London CAM

Page 12

REFERENCES/BIBLIOGRAPHY:
 Ackerman, L (1997) Development, transition or transformation: the question of change in organisations. In: Van Eynde, D., Hoy, J and Van Eynde, D (eds) Organisation Development Classics. San Francisco, Jossey Bass.  Brassington F and Pettitt S Principles of Marketing, Third Edition (FT Prentice Hall, 2002)  Christopher M, Payne A and Ballantyne D Relationship Marketing: Creating Stakeholder Value (Butterworth-Heinemann, 2001)  Hatton A The Definitive Marketing Plan (FT Prentice Hall, 2000)  Mark Easterby-Smith and Luis Araujo (1999), Organizational learning and learning Organizations, London, sage, 247- viii pages.  McDonald M Marketing Plans: How to Prepare Them, How to Use Them, Fifth Edition, (Butterworth-Heinemann, 2002).  Mintzberg, H (1989) Mintzberg on Management: inside our strange world of organisations Chicago, Free Press.  Businesstools (2010), General Electric Matrix, Available from,http://www.business-toolstemplates.com/U_GuidesPDF/General%20Electric%20GE%20McKinsey%20Matrix%20 User%20Guide.pdf Assessed on 6th Aug, 2010.  learnmarketing (2010), Porters 5 forces model, Available from,

http://www.learnmarketing.net/porters.htm Assessed on 9th Aug, 2010.  valuebasedmanagement (2010), SWOT analysis, Available from, http://www.valuebasedmanagement.net/methods_swot_analysis.html Assessed on 9th Aug, 2010.  Market developer (2010), Systematic Approach, Available from http://www.marketdeveloper.com/a-systematic-approach-tostakeholdermanagement_2.htm Assessed on 7th Aug, 2010.  Businessdictionary (2010), the Differentiation, Available from, http://www.businessdictionary.com/definition/organizational-design.html London CAM Page 13