Functional Strategies Essay

1752 words - 8 pages

Group 1
Members: Emelda Bacchus, Andrea Alexander, Ashea Cadiz,Adencia Baptiste
Topic: Strategic formulation: functional strategy and Strategic Choice
Class: Strategic Management
Teacher: Satynarayana Ramella

Functional Strategy
* The approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity.
Functional areas
* Marketing
* Financial
* Research and Development
* Operations
* Purchasing
* Logistics
* Human resource management
* Information Technology
Corporate Strategy
Example: The February 2011 announcement an alliance ...view middle of the document...

* Market share ––gaining and holding a specific share of a product market.
* Human talent ––recruiting and maintaining a high-quality workforce.
* Financial health ––acquiring financial capital and earning positive returns.
* Cost efficiency ––using resources well to operate at low cost.
* Product quality ––producing high-quality goods or services.
* Innovation ––developing new products and/or processes. Social responsibility ––making a positive contribution to society.

Marketing Strategy
Involves: pricing, selling, and distributing a product
Types of marketing strategies used:
* Market Development.
* And Product Development.
For whom?
OUR PRIMARY CUSTOMER
Identify KIND OF PRODUCT INTENDED TO OFFER
CUSTOMERS
EXISTING NEW
EXISTING - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
MARKET MARKET
PENETRATION DEVELOPMENT

PRODUCTS OR - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -SERVICES
PRODUCT DIVERSIFICATION DEVELOPMENT INNOVATION
NEW - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
AREAS FOR MARKETING STRATEGY
* MARKET PENETRATION STRATEGY
(Stay in current markets with existing products)
INCREASE RATE OF PURCHASE/CONSUMPTION
ATTRACT RIVAL’S CUSTOMERS
BUY OUT RIVALS
CONVERT NON-USERS INTO CURRENT USERS
* MARKET DEVELOPMENT STRATEGY
(Find new markets for current products)
ENTER NEW GEOGRAPHICAL MARKETS
FIND NEW USES FOR EXISTING PRODUCTS
FIND NEW TARGET MARKETS
* PRODUCT DEVELOPMENT STRATEGY
(Develop new products for existing markets)
IMPROVE FEATURES – CONSIDER BRAND NAMES i.e. LINE EXTENSION
IMPROVE QUALITY/RELIABILITY/DURABILITY
ENHANCE AESTHETICS/STYLING
ADD MODELS
* DIVERSIFICATION STRATEGY
(Develop new products for new markets)
* Keeping market Strategies on Target
MARKETING MIX ISSUES
* Product Strategy
Specifying the exact product or service to be offered
* New or existing product? …for new or existing customers?
* Promotion Strategy
How the product or service is to be communicated to customers
* “Push” - spend more on promotions and discounts to push products
* “Pull” - spend less to build brand awareness so consumers will ask for it by name
* Channel or “Place” Strategy
Selecting the method for distributing the product or service
* Distribute through dealer networks or through mass merchandisers?
* Sell directly to consumers through own stores or through internet?
* Price Strategy
Establishing a price for the product or service
* “Skim pricing” (high) when you are a pioneer
* “Penetration pricing” (low) builds market shares
* “Dynamic pricing” (prices vary frequently) based on...

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