Study Unit 1

Strategy Levels: The functioning of SBUs:

1. Corporate strategy SBUs are distinct businesses set up as units

- The organization's sense of purpose.
2. Business strategy
- Managing a specific division or
business unit.
3. Market strategy
- The marketing management's
contribution to formulating the
business strategy.
4. Functional strategy
- is equivalent to the marketing
strategy
How strategic marketing management and retail marketing management differ
in a larger company to ensure that a certain
product or product line is promoted and
handled as though it was an independent
business.
An example would be Pick n Pay, they have
many SBU’s such as hypermarkets,
supermarkets,
family franchise stores, butcheries and
financial services.

Study Unit 2 - ANALYSING THE MACRO-ENVIRONMENT

Characteristics of the macro-environment The Dimensions of the
macro environment on a
1. The ever changing nature of the external business
environment.
2. The impact of external forces on the external 1. Technological
environment 2. Government /legal
3. The overwhelming state of external variables 3. Economic
4. Social/cultural
5. Demographic
6. International
Four stage process of strategic
environmental issue management.
1. Environmental scanning
- The irregular approach
- the regular approach
- the continuous approach
2. Key environmental issue identification
3. Impact evaluation
4. Response strategy formulation

Study Unit 4 - MARKET ANALYSIS

Porters Model of competitive forces:
1. Threat of new entrants
2. Bargaining power of suppliers
3. Threat of substitutes
4. Bargaining power of buyers
5. Rivalry of direct competitors
The 6W model of customer analysis
1. Who are the current and potential
customers?
2. What do the customers do with the
products?
3. Where do they purchase the products?
4. When do they purchase the products?
5. Why and how to the customers select the
organisations products?
6. Why do potential customers not purchase
the organisations?
The role of needs and benefits, and
also perceived costs, in creating
customer value.
Customer value: Competitive prices
does not always translate into value
for customers.
Customers will come back to do
business with your store if they
receive good value for their
money. Value is created when
customers receive more than what
was originally offered. When
they are made to feel important,
respected, and appreciated.
 5. Why and how to the customers select the
organisations products?
6. Why do potential customers not purchase
the organisations?
business with your store if they
receive good value for their
money. Value is created when
customers receive more than what
was originally offered. When
they are made to feel important,
respected, and appreciated.

The role of needs and benefits, and
also perceived costs, in creating
customer value.
Perceived costs: Customers not only
look at the benefits that they receive,
they also look at what they perceive
themselves as paying.
The perceived costs are:
-Monetary costs
-Time and energy expended
-Psychic expenditure
The role of needs and benefits, and
also perceived costs, in creating
customer value.
Customer needs: Businesses need to
take the time to gather information
about their customers’ needs to
adapt their value packages to meet
those needs. These can include
(among others) stocking up on
manufacturers brands, expanding on
their organic products, adding fat-
free products etc. This is then called
Marketing Research.
4 important processes:
1. Selecting the customer base
2. Developing a value proposition
and positioning statement
3. Determining who the main the
actors in the decision-making phases
are
4. Designing how interaction with
these targets will take place

Phases customer value delivery:

1. Identification of customer needs and expectations

2. Internalisation of needs and expectations
3. Provision of value
4. Customer maintenance and development
5. Customer satisfaction
6. Systems, procedures, policies and processes
7. Technology

Study Unit 5 - COMPETITOR ANALYSIS

Steps that a retailer should take when performing a Key Success factor analysis (KSF)
competitor analysis : Representative weighted competitive strength
assessment
1. Identify competitors
- Present and potential

2. Analysing strategic groups Blue Ocean Strategy Canvas – page 110

3. Analysing keep competitors
- Competitor objectives Focus on more than just satisfying customers in
- Competitor strategies current market but also the markets of the future
- Competitor strengths and weaknesses must be identified and new product innovations
- Forecasting likely response strategies explored to address the needs of the future

Red ocean = existing

Blue ocean = future

Focus on current competitive environments are

irrelevant and a waste of time and the focus should
be on carving new opportunities
Competitive positions

1. Market leader
2. Market challenger
3. Market follower
4. Market niche
Competitor Decision making pitfalls Competitive intelligence practices
(Process)
1. procrastination
2. thinking too small 1. Identification of key role players and sources
3. failure to communicate strategy 2. Collection of data
4. making hasty decisions 3. Analysis of findings
5. draw incorrect conclusions about 4. Communication of results
findings 5. Management of the information collected

Study Unit 5 - INTERNAL ANALYSIS

Five steps of the internal analysis process. Resource based view:

Step 1: Identify the primary organisational drivers.
Step 2: Conduct a thorough analysis of strengths and
weaknesses, and identify key issues.
Step 3: Set organisational objectives to address the key issues
Step 4: Examine organisational resources and capabilities
Step 5: Conduct a gap analysis of the objectives and the
organisational resources and
capabilities.
Looks at the resources of the business as the foundation to
formulating marketing strategies.
RBV will identify the uniqueness and the capabilities of the
resources available to, and inside, the company to support the
Sustainable competitive advantage
Uniqueness – coke and its secret recipe
 Five steps of the internal analysis process.
Step 1: Identify the primary organisational drivers.
Step 2: Conduct a thorough analysis of strengths and
weaknesses, and identify key issues.
Step 3: Set organisational objectives to address the key issues
Step 4: Examine organisational resources and capabilities
Step 5: Conduct a gap analysis of the objectives and the
organisational resources and
capabilities.
Resource based view:
Resources must be time based - strategic manager must link
resources to short, medium and long term to get even strategic
advantage from them
Coke – unique recipe is long term based for that sustainable
competitive advantage over time
Time based resources generate new strategies over the short,
medium and long term in the sense that combining some
resources will lead to new competitive advantages over time
Functional analysis
Looks at each functional area Functional resources must be
used optimally, serves a s strength in the organisation and can
be a weakness if not used optimally
SWOT analysis
Strengths and weaknesses = internal environment
Opportunities and Threats = External environment
Systematic way of integrating internal and external analysis to
find a strategic fit between the market and macro environment
and the internal aspects of the organisation
Study Unit 7 - INTERNAL ANALYSIS
Explain the need for a market strategy in an organisation
Today's organisations are faced with rapidly changing
environmental conditions as well as
increased competition. The complexity of managing these
organisations has forced
entrepreneurs to find methods to integrate different divisions
and functional areas in the
organisation. We can identify the following different levels of
strategy in large organisations (as discussed in study unit 1):
Corporate Strategy, Business Strategy, Market Strategy,
Functional Stategy
Sources of sustainable competitive advantage – Page 179
Relational sources
Legal sources
Organisational sources
Human resources
Product sources
Pricing sources
Promotion sources
Distribution sources
Resource based view:
Looks at the resources of the business as the foundation to
formulating marketing strategies.
RBV will identify the uniqueness and the capabilities of the
resources available to, and inside, the company to support the
Sustainable competitive advantage
Uniqueness – coke and its secret recipe
Performance analysis – 124 TB
Based on the utilisation and application of resources in and
around the business
Financial and non-financial performance measures
resources will lead to new competitive advantages over time
Value Chain analysis
Main aim – it is a systematic way of examining all the activities
a business performs and how they interact to differentiate the
business value delivery process from competitors
Customer seeks value – delivered value is a crucial part in
determining the sustainable competitive advantage of an
organisation among other competitors
Internal Analysis
Helps the marketer to identify any gaps between available
organisational resources and capabilities and its objectives
Steps
1. Identify primary organisational drivers
2. Conduct a thorough analysis of strengths and weaknesses
and identify key issues
3. Set organisational objectives to address the key issues
4. Examine organisational resources and capabilities
5. Conduct a gap analysis of the objectives and the
organisational resources and capabilities
Prerequisites for establishing an SCA
- The basis of competition: skills and assets : Any strategy
should be based on specific assets, skills and capabilities.
Without this support, no competitive advantage will be
sustainable.
The SELECT framework
The SELECT framework is an acronym for the six dimensions of
a competitive advantage, namely:
(1) substance
(2) expression
(3) locality
(4) effect
(5) cause
(6) time span
Study Unit 8 - COMPETITIVE STRATEGIES

Competitive Strategies Differentiation Focus strategy

- The differentiation strategy
- The low-cost strategy
- The focus strategy
- The pre-emptive move
- Synergy
product differentiation – the ability
of the business to differentiate the
product from that of its competitors
by means of product of attributes or
benefits
focus on small or narrow segment of the
market, with the premise that the business is
better suited to serve the needs of a limited
segment of the market
usually used small/medium sized companies
operating in markets that are dominated by
larger operations

Pre-emptive Move – 293 TB

Being first in the field Synergy – 295

First move or pioneer strategy
Whole becomes greater than the sum of the
Important factors to consider: parts Forms of synergy
Being first requires some form of innovation – culture must be - Sharing knowledge and skills
prepared to take risks - Sharing assets and resources
Substantial commitment of resources is required - Pooled negotiation power
Assumes it will difficult for competitors to copy or counter - Aligning strategies between SBUs
- Vertical integration of SBUs