Marketing Strategies in the Asia Pacific
Download
Report
Transcript Marketing Strategies in the Asia Pacific
Marketing Strategies in
the Asia Pacific
Asia-Pacific Marketing Federation
Certified Professional Marketer
Copyright
Marketing Institute of Singapore
Outline
Porter’s Three Generic Strategy
Growth strategies
Ansoff Grid—Product-Market Strategies
Market Penetration Strategy
Product-Development Strategy
Market-Development Strategy
Diversification Strategy
Introduction
Many strategies had been used since
time immemorial. Fortunately for us,
Prof. Michael Porter had condensed them
into 3 generic types
Porter’s Three Generic Strategies
See next slide: Figure: A model for
developing strategic orientation
Strategic Orientation—
Porter’s Three Generic Strategies
Low Cost
Position
Uniqueness
Differentiation
Focus
Differentiation
Overall Cost
Leadership
Focus
Focus Low Cost
Strategic Advantages
Porter’s Three Generic
Strategies
Differentiation
Achieve superior performance over the
competition
e.g. Canon uses superior quality to differentiate
itself in the photocopying industry
Porter’s Three Generic
Strategies (cont’d)
Overall Low Cost
Achieve the lowest cost in the industry
e.g. Naxos in the compact disc field
Focus
Either focus differentiation or focus low cost by
concentrating on a narrow segment of the
market
e.g. Raffles Hotel
(Source: Marketing Management, 2nd Ed. 1999, Philip Kotler et. al.)
Growth Strategies
Three Major classes
Intensive Growth
Market penetration, market development &
product development (see next slide)
Integrative Growth
Backward, forward & horizontal integration
Diversification Growth
Concentric, horizontal and conglomerate
Source: Marketing Management, 2nd Ed. 1999, Philip Kotler et. al.
Ansoff Matrix—
Product-Market Strategies
Existing
Existing
New
Market
Penetration
Market
Development
(Expansion)
New
Product
Development
(Expansion)
Diversification
Market-Penetration Strategy
Why ?
How ?
To dominate market
To increase usage or get new customers;
reduce price; expand distribution or increase
promotional activities
When ? When market is growing
What to look out for ? Competitive reaction;
cost of
conversion
Example: Airlines used reduced fares
& promotion
various family travel packages to penetrate market
Product-Development Strategy
Why ? To satisfy buyer’s need
How ? New or improved product; innovate or
augment product
When ? Customer has a need or a problem
What to look out for ?
Market size/volume
competitor reaction
effect on existing products
resources to deliver new products
Examples: Acer; Soundblaster 1,2,3
Market-Development Strategy
Why ?
How ?
To venture into new markets
Sell existing products in new markets;
modify product; use different distribution; use different
advertising/sales strategy
When ? Present market is saturated
What to look out for ? Competitive reaction;
understand new buyers; adaptability
Example: Hong Kong and China Gas (Towngas) is to
invest HK$2 billion in the transmission of natural gas in
China, in a continued bid to expand away from its base
in Hong Kong.
(Source: SCMP; June 29, 2001)
Diversification Strategy
Why ? Growth opportunities outside current business
How ? New products for new markets
When ? Distinctive competencies available
What to look out for ? High risks, resources required,
need to understand new markets, fit with distinctive
competencies
Examples:
In July 1997, DBS Land diversified into Healthcare by
acquiring a stake in Parkway Holdings, a leading
healthcare provider in Asia and in 1999, DBS Land
bought into Vista Healthcare
Diversification Strategy
(cont’d)
Three types of diversification
Concentric, horizontal and conglomerate
Three essential tests of success
Attractiveness
Cost-of-entry
Better-off
PIMS findings on diversification
Not very encouraging
Vertical Integration
Why?
To gain operating economies i.e. to lower costs
To gain access to or control supply demand
To enhance technological innovation
How? Integrate backward and forward
When? Basic industry is in a growth stage
What to look out for? Problems in managing very
different businesses; increase risk, reduced flexibility;
cost of excessive in-growing
Example of Vertical
Integration
Japanese keiretsu systems
Korean chaebols
Airlines integrate backward to in-flight
kitchens; forward to travel agencies