Marketing Strategy for Purpose and Direction- myassignmenthelp

Question: Discuss about theMarketing Strategy for Purpose and Direction. Answer: Introduction Strategy is defined as the way or the means with the help of which organizations are able to achieve their desired objectives and goals. Strategies act as a guiding framework for the organizations, which help them in accomplishment of organizational goals. According to Wordsmyth dictionary, strategy is defined as a plan, series or method of actions which are designed with the objective of achieving a goal, objective or effect of the organization. (Foundations of Strategy, 2017). Businesses need strategy with common reasons like to give purpose and direction, effective deployment of resources and coordinating decision- making. Strategy is formulated keeping in mind certain objectives like creating advantage, renewing advantage and sustaining advantage with the objective of producing superior value of business ecosystem. Likewise, the theories of strategy try to explain some underlying forces responsible for producing this advantage or primary factors which can be considered in produci ng advantage. Some of the theories of strategy are classical, evolutionary, systematic and processual theories of strategy (Managing Research Library, 2017). Strategic thrusts are the initiatives which are at high level and they arise out of the strategic vision of the company and also serve as a guideline for the action plans with the objective of attaining some over-arching goals. It helps the company in deriving maximum information from the companys resources for the purpose of gaining competitive advantage (MBA Skool, 2017). The report will talk about a specific business unit of a company and what role does it play in the organization. Before going towards the next section, there is a need to understand the role of Strategic Business Unit (SBU) within the business. A strategic business unit also known as SBU is the functional unit of business having its own directions and vision. SBU acts and operates like separate entity or business unit having a considerable importance within the company. SBU reports its operational status to its headquarters. It acts independently giving its own of performing actions and target market. SBU has its own business functions such as HR, training sessions etc. and holds several benefits of having SBU within a business. (The Economic Times, 2017). Role of SBU within business is that SBUs make a business organized, things can be micro managed, segmentation, targeting and positioning can be done easily, helps in decision- making and also contributes to the profitability of the business (Bhasin, 2016). The company discussed in the report is Myer, founded by Sydney Myer. Myer is the largest department store group of Australia been consistently synonymous with their style and fashion for 100 years. The company is having 67 stores in the most prominent retail locations of Australia with their well-recognized name along with having a huge support from their new online portal enhancing their digital presence. This creates an Omni-channel experience for the customers from which they choose from. The company provides inspiration to the customers, employees, shareholders, suppliers and communities. The merchandise offered by Myer are divided into 11 product categories viz. Menswear, womens wear, Intimate apparel, childrens wear, cosmetics and fragrance and beauty products. It also offers electrical goods, footwear, accessories, handbags, toys and many other types of general merchandize. So the company is the leader in Australias retailing industry and is Australias largest department store group. It is a heritage build on market innovation and involvement of community (Myer, 2017; Myer, 2016). Discussion The Strategic Business unit that we will be taking in this report is the Womens clothing of Myer. It is separate unit of Myer having its own ways to operate the business and standing as a single separate business unit. It operates separately within the name of Myer and reports its operational status to the Myer, which is the parent company. The SBU and the company, focuses on providing fresh and trendy fashion for professional, off-duty and normal wear. The company is committed for hitting fresh arrivals on the wardrobe with these sartorial staples. They provide for work-wear, off duty chic with blue jeans and slouchy tees. The womens wear SBU of Myer provides a range of products such as dresses, coats, jackets, tops, t-shirts, singlets, jumpers, shirts, blouses, pants, leggings, skirts, activewear, jeans, workwear, jumpsuit, shorts, swimwear, petite size and plus size (Myer, 2017). Market Strategy The strategy at business unit level is determined on the basis of three Cs- customer, competition and company. Based on the experience of different companies it is evident that the strategy of the business units can be formulated by placing them on two-by-two matrix including industry maturity and competitive position. Industry maturity or attractiveness can be studied with reference to the industry life-cycle stage. Factors that can be considered in determining industry maturity are growth rate, breadth of product line, perspectives regarding market share, ease of entry, industry potential, and number of competitors, customers purchasing pattern and technological developments. There are four stages in industry maturity viz. Embryonic, growth, and maturity and aging stage. In embryonic stage, there is a narrow product line and changes are done frequently to meet customer needs. In growth stage, there is a rapid proliferation of the product lines. At maturity stage, it is attempted to orient products according to specific segments and in the aging stage, there is shrinkage of product lines. After analyzing the industry on the above mentioned factors, it is found out that the company is experiencing rapid expansion of sales because of the market development. It is seen from the analysis that the shares, technology and customers of the company are better known and it will be difficult for the new market entrants to enter the industry. Therefore, it is clear that the industry is in the growing stage. Competitive position is another matrix for formulating the strategy at business level. Competitive position of the business does not merely depend on its market share but, other factors like capacity utilization, degree of integration, management strength, current profitability and distinctive product advantages. There are four competitive positions viz. dominant, strong, favorable, tenable or weak. From the analysis it is drawn that the SBU can take independent actions without any danger to its long -term position and the SBU manages to maintain its long- term position in light and face of the competitors action. Therefore, it is concluded that the competitive position of SBU is deemed strong. Therefore, in short, it can be said that the industry is in the growing stage and the SBU is deemed strong as the brand name supports the positioning of the SBU and Myer is the largest department store group of Australia and have a competitive advantage as it is the largest among all and also, the industry is in growing phase (Jain, Haley, Voola, Wickham, Osbourne, 2011; Young Burgess, 2015; Marketing Teacher, 2017; Denny, 2017). There are three types of core marketing strategies that a company may use which are operational excellence, customer intimacy and product leadership. The most viable approach for the womens clothing SBU of Myer will be operational excellence. The strategy of operational excellence includes middle off the market product offerings at the best affordable prices along with least inconvenience. This strategy involves least customer proposition it also includes low prices and hassle free services or a combination of both. In order to get better results after final selection of core strategy, supporting strategies should be delineated. This is because a mix of core and supporting strategies will help in coordinating with the needs of the market place, the vagaries of the competition and the skills of the company. The strategy of operational excellence is the most viable for the womens clothing SBU as it includes convenience in services with low affordable prices, which will help the busines s unit in penetrating into the market, with increased sales and profit shares under a reputed and well established brand name. The company can pair its core strategy of operational excellence with supporting strategies like product, distribution and promotion in order to get better results. It is the most viable for the business unit as it provides no-hassle services, sharpen distribution systems. In addition to this, it is profitable for organizational arrangement as it includes strong central authority and finite level of empowerment. The strategy also believes in one size fits all and acts in a predictable manner. The strategy also helps in developing and maintaining standard operating procedures. Because of the above stated reasons, the core strategy of operational excellence will be best suited for the SBU. In addition to this, operational excellence helps in achieving cost leadership. As the customers of the business unit are price sensitive this strategy will be most feasible as the cost leadership acts as a path towards continued growth (MaRS, 2013; Jain, Haley, Voola, Wickham, Osbourne, 2011). Portfolio Analysis The portfolio analysis tool which is applied here is the Product life cycle. Every product goes through certain stages in their life cycle in which each stage is affected by different competitive conditions. At different stages, there is a need to apply different marketing stages with best suited for the product at that particular stage. This is done in order to realize the sales and profit in a more efficient manner. The life cycle of the product is depicted using an S-shaped curve which is divided into four stages- introduction, growth, maturity and decline. The introduction stage is the initial phase of the product life cycle when the product is just introduced in the market and experiencing slow growth. In the growth stage, the survivors of the introduction stage come in and enjoy rapid growth and improved profits. In the maturity phase, the product gets stable and gains maturity including intense rivalry in a mature market. The last one is the decline stage, where the product fa ils to manage its profit and there is a decline in sales leading to the decline of the product in its life cycle. The main products of the SBU which is workwear, off duty and slouchy tees are significantly in demand. The workwear product of the SBU sits at the maturity stage as it is the only product of the SBU which is at the highest peak of its sales, providing low cost per customer, earning higher profits and have majority of customers. The off duty clothes are at the growing stage as they are experiencing rapidly rising sales, providing average cost products as per customer, managing rising profits with growing number of competitors and early adopter customers additionally. The slouchy tees are at the introductory stage as they have been launched recently and have low sales and negative profits, providing products at high cost per customer, have innovative customer segment and a few customers (Jain, Haley, Voola, Wickham, Osbourne, 2011; Ã… ½ic, HadÃ… ¾i?, Ikoni?, 2009; Jblear ning, 2017) (Ã… ½ic, HadÃ… ¾i?, Ikoni?, 2009). Strategic Development Tools In order to formulate strategy, there is a need for systematic procedures which can help an organization in developing strategies. Therefore, there are some selected tools and models which help in strategy development. Model is defined as the instrument which is directed towards helping in searching, screening, analyzing, selecting and implementing a particular course of action. There are eight models which can be applied directly to marketing strategies and they are- the experience curve concept, value based planning, the Delphi technique, Cross impact analysis, the profit impact of marketing strategy model, game theory, trend impact analysis, and scenario building. Two of the above stated strategy development tools are discussed as below- Experience Curve Concept It is proven fact that practice makes perfect and leads to better results. It is commonly known that beginners are slow and clumsy but, with practice, beginners grow and improve to the point where their own permanent level of skill is being reached. Anyone who owns a business will be very known by the fact that the initial times in a business venture does not turns out to be profitable immediately. A successful business person states that learning and experience will lead to improvement. Afterwards it was observed that the experience curve is not only limited to the production units but, it embraces all areas of business. The importance of experience curve is worldwide but it fails when it comes to marketing objectives and pricing decisions. It is said that all the costs will go down with the increase of experience. Thus, in case a company will acquire high market share cost will decline and it will lead to reduced prices. With its effect, lowered prices will still somehow manage to acquire higher market share. In the time of growth, a company continues to make profit but with the objective of growing it, the company needs to reinvest the accumulated profits. Thus, the experience effect has been used in most of industries but this concept is least applicable in marketing. Some of the benefits of this concept are- It provides an accurate description of the relationship between cost and volume. The accumulated experience from the first product can help in providing extra advantage to the company in reducing the prices. Gaining of experience with time will help in setting the business in long run as the situations are best handled with good experience. Experience leads to accelerated business activities and, therefore, tasks can be completed with much greater efficiency. The concept of experience is not limited to production alone instead it is applicable in almost all cost areas of business. (The Economist, 2009; Henderson, 2017) Delphi Technique Delphi technique is a method which involves making forecasts and future decisions on the basis of expert opinion. It helps in forecasting future trends and preference shifts and their significant impact on future strategic environment and needs. The Delphi method was formulated for overcoming the issues and weaknesses of the committee method. The Delphi method is becoming more prominent and increasingly significant in forecasting the future events and it is used by most of the organizations with the objective of long rage forecasting. Some of the benefits of Delphi techniques are- Efficient way to gain information from the experts. Involves less effort at the part of respondents in answering any questionnaire. It includes use of systematic procedure which leads to productive outcomes. It includes more accurate forecasts when compared to traditional statistical techniques. By seeing the responses of such knowledgeable persons, it can turn out to be a motivating factor for group of experts. (Thangaratinam Redman, 2011) Summary The approaches stated above plays a significant role in the strategic planning and implementation process such as it contributes in measuring the strategic performances and achieving strategic planning effectiveness. Strategy tracking and progress evaluation of the established objectives is one of the most important tasks in strategy implementation. The three basic considerations- selecting measure for performance, setting standards for performance and designing reports is put together in performance management system. The selection of performance measure is done with the help of the above adopted strategies. The measures which are relevant to the adopted strategies by SBU is being chosen. Further the performance standards, expected values and targets are established in coordination with the strategies selected and the strategic position of the business unit. Therefore, the above stated strategies help in measuring strategic performances. References Bhasin, H. (2016, December 2). 6 Reasons Strategic business units are important. Retrieved may 22, 2017, from Marketing91.com: https://www.marketing91.com/6-reasons-strategic-business-units-important/ Denny. (2017). 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