Critical Analysis of Strategic Marketing Theory: MKTG8020 Report

This report critically analyzes strategic marketing theory, focusing on its definition, practical applications, and limitations within the modern business environment. The paper examines the core components of strategic marketing, including organizational objectives, the strategic marketing foundational premises such as competitive advantage, relational assets and mutually beneficial exchange. It also delves into marketing strategy behaviors, covering competitive, cooperative, and collusive strategies, along with contemporary marketing behaviors like segmentation. The report integrates relevant literature and real-world examples to illustrate the theory's application. The paper concludes with recommendations for marketing managers on how to effectively apply the theory within their organizations. The assignment, submitted by a student, is available on Desklib, a platform offering AI-powered study tools and resources for students.

Running Head: Marketing Theory
Marketing Theory
Unit Name:
Name of the Student:
Student Number:
Name of the University:
Author’s Note

1MARKETING THEORY
Table of Contents
Introduction....................................................................................................................2
Theory in Practice..........................................................................................................2
Overview of Strategic Marketing...............................................................................2
Organizational Objective of Marketing Strategy.......................................................2
Purpose of marketing strategy....................................................................................3
Strategic Marketing Foundational Premises..............................................................4
Marketing Strategy Behavior.....................................................................................5
Contemporary Marketing Behavior...........................................................................6
Internal and External Organizational Environment...................................................8
Strategic Marketing Fundamental Issues...................................................................9
Conclusion......................................................................................................................9
Reference......................................................................................................................11

2MARKETING THEORY
Introduction
The following paper is based on the marketing theory covered in the course. The
selected marketing theory from week one to week five is Strategic Marketing. The concept of
marketing strategy can be defined s a company’s goal and objective and is a combined
objective of a single comprehensive plan (Thompson, Strickland and Gamble 2015). The
assessment aims to define, explain and compare the marketing theory selected for the
assessment. Further in the paper, the theory will be highlighted in contrast to the limitation
and application in the modern business world and marketplace. At the end of the paper, the
recommendation section will cater to explain to the marketing managers as to how to apply
the theory in the organization. However, there are four marketing strategies and they are
product, place, price, and promotion, which deal with the essential four elements of the
marketing and help the organization to finalize its business plan. There are various areas
which are covered under the theory of marketing strategy and it is inter-related within the
management and its employee.
Theory in Practice
Overview of Strategic Marketing
Marketing strategy in any organization, company or small firm industry can be related
to the long-term commitments and caters to look forward with the planned approaches to an
aim to fulfill those objectives and achieve a substantial competitive advantage. Some of the
examples of marketing strategy can be co-branding, direct selling, cause marketing, word of
mouth advertising, point-of-purchase, and earned media (Cacciolatti and Lee 2016).
However, the role of marketing strategy is significant because it states the historical
information on the way the competitors have advertised their products and services. The
target market is the main focus of the business and in order to attract customers, the business
must plan its strategies and perform its marketing function.
Organizational Objective of Marketing Strategy
It can be illustrated that the marketing strategy can be determined by using the
company’s resources and the methods in which the company can achieve the objectives based

3MARKETING THEORY
on the need and requirements of the managers and stakeholders (McDONALD 2016). It
further comprises customers, employers, employees, rival firm and investors. However, there
are three primary objectives of marketing strategy and they are:
Selection of target market: Target market helps the entire marketing processing
easier and much feasible. Being a concept of the marketing process, it helps treh business to
earn greater profits. It includes the specific groups of people who are interested onto buying
different and specific products.
Specification: It is very important for a business or an organization to identify the
specification of the market. The market defines the segregation on basis of groups which
include the customers who have similar interest for particular products or the customers who
can respond immediately to the change of the market strategies. (West, Ford and Ibrahim
2015). Different companies have their own strategies in segmentation of it smarket for the
attraction of greater number of customers.
Creation of marketing mix: It is very important for a company to take care of the
market positioning because it helps to build a specific image for the aufience as well as the
target customers. The organization should focus on the P’s of marketing mix along with the
additional three P’s, which are people, process and physical evidence (Rothaermel 2016).
Brand positioning is an important starategy that the markets have in order to keep themselves
at pace with the competitors.
Purpose of marketing strategy
In the recent market where there is the advancement of technology, the impact is on
the marketing environment which should also be changed constantly. With these approaches,
there are two main purposes of marketing strategy and they are:
Strategy is repeatable: the strategies formulated by the company can be reused by the
team members if the strategy seems to achieve the organizational goals and objectives.
However, this makes the work easier as the same approaches need to be replicated. While
starting work in the organization it is effective for the firm as well for the employees to first
formulate the strategy because this makes the work more simplifies (Hunt 2015). The
strategies formulated to specify the goals and objectives one should work for and work

4MARKETING THEORY
towards a similar kind of outcome that comes under brand awareness or leading the team
members.
The strategy is scalable: a good marketing strategy is scalable which means that is
can be used by any of the employees working under the same organization. If there is a
significant network of mobile marketing strategy, then it would be of great help and
assistance if the employee adopts the same strategy. However, it is essential to educate the
workers and capture the attention of the target market. It seems to be very simple but it
requires the planning and implementation to do so.
Strategic Marketing Foundational Premises
The marketing strategy foundation premises of marketing strategy can be defined as
the voicing concerns on the marketing’s exchanges with the company, and thereby it also
enables them the loss of influence in the academic discourse about strategy, where the
company can achieve the specified objectives.
Achieve and sustain competitive advantage: for an organization in order to achieve
and sustain in competitive advantage, it has to focus on cost leadership, differentiation and
focus. In the case of cost leadership, the organization is able to produce and sell its
commodities and services at a much lower cost than the competitors. This however, enables
the organization to lower the cost than its competitors (Coccia 2017). The approach of cost
leadership strategy for most of the organization is not practical and this is because it needs a
high saving to achieve economies of scale. However, the focus of the organizational strategy
enables them to dominate a niche. In this marketing strategy, the organization must focus on
a limited part of its production. On the other hand, the differentiation strategy distinguishes
its product and service by highlighting its features and benefits and compares the product
from the competitors. For example, companies like Nike, BMW and Apple can charge a
premium price and however earn more profit implementing the differentiation strategy.
Create market-based relational assets: the objective of the company should be to
deliver the value of investors. Based on the resources the management can view the theory
and develop a differential advantage in order to maintain the earnings in excess of the capital
(Coccia 2017). The resources are rare, non-substitute, and make it possible for the business to
develop and maintain a competitive advantage.

5MARKETING THEORY
Nurture mutually beneficial exchange relationship: in case of products like Apple or
Nike shoes the customers are willing up pay a high price because it enables them to carry a
brand along with them. This also creates a strategy within the organization to cater to quality
products and add a differentiated price with some unique features which are not found within
the competitor’s brand.
Nurture mutually beneficial exchange relationship: according to the marketing
strategy, it is essential to cater to the customer as they are the sole reason why the business is
running and performing in the market. However, it is the organization that needs to build a
relationship with its customers either by its technique of rendering service or by delivering
the quality products (Coccia 2017). Some of the customers are attracted to Starbucks just
becomes of the aroma of the store and the freshly crushed bean coffee whereas there are other
kinds of customers who visit the store just because they have a memory attached to it. The
organization has to cater and keep in mind both types of the customer and plan its marketing
strategy accordingly.
New points of differentiation: the point of implementing differentiation strategy by
the management is to take up the business and develop a unique product or service where the
customers can find better or another way to distinguish from the competitor’s product and
services.
Marketing Strategy Behavior
Behavioral marketing caters to the aspect of customer behavior, which assists in
shaping the marketing plan in a technique that is most effectively based on the behavior and
ultimately, it increases the profit. This shapes the media in which the advertisement will be
displayed to the customers and how they can interact with the business. There is three board
classification of the marketing strategy behavior which is stated below:
Competitive Behavior: in order to develop the theory of marketing strategy, the
organization must be aware of its weaknesses and strengths, the competitors, and the need of
the customers. In order to be successful, it is no longer adequate to be good at satisfying the
needs and wants of the customers, but the organization must perform better than their rival
firms. In order to compete with the rival firms in the market, the organization must try harder

6MARKETING THEORY
and seek to safely the customer through various innovative techniques (Davcik and Sharma
2016). Competitive behavior takes five forms which are conflict, competition, co-existence,
cooperation and collusion. However, the competitors play an essential role in increasing the
level of advertising and the product quality in order to perform well and therefore it becomes
difficult for the firm to expand its product and bring in innovation. Thus in order to apply the
marketing strategy, the organization should take into consideration the competitor’s unique
way of manufacturing and production so that the firm can improve its functioning.
Cooperative Behavior: this involves the accumulation of skills and resources for
more than two firms to overcome the issues and take advantage of various new opportunities.
There is a growing trend in catering to the strategic alliances where the companies come
together in a joint venture, joint R&D contract and licensing agreements to create a long term
competitive advantage. In the recent development of the markets the size of the firm forms
the critical source of advantage and cooperates with the major types of competitive behavior
(Patrutiu 2016). The objective of cooperative marketing caters to the area of economic
efficiency, access to a target market, broader visibility, shared resources, and consumer
convenience.
Collusive Behavior: in collusion behavior, marketing strategies occur when
competitive firms agree to work together. For instance, it can set higher prices in order to
make greater profits. The collusion caters to the way the firm makes a higher amount of profit
and is expressed to the consumers and on the other hand, the competitive attributes are also
reduced. In this form of marketing strategy, the collusion usually involves the attribute of
seeking higher prices and also involves setting a deal within the dealer and the suppliers. For
example, the vertical price-fixing where the retail price maintenance sets the price of the
commodity to be sold in the market (Conley and Decarolis 2016). Similarly, this approach of
marketing strategy forms a very small margin of profit to the suppliers and less chance of
alternatives. This exists between the industries and to eliminate new firms from deals and
prevent the market from more competitive approaches.
Contemporary Marketing Behavior
Segmentation: marketing segmentation is one of the important attributes of strategic
marketing because this is an integral part of the market research which is conducted by the

7MARKETING THEORY
business and assist in dividing a market of prospective buyers into potential and target market
based on various characteristics. Each of the market segments represents the buyers who have
similarity traits and responses to the marketing strategy (Wuryandani, Ismoyowati and
Nugrahini 2018). However, customer segmentation is a crucial part of the organizations’
marketing strategy. There are four types of segmentation are geographic segmentation,
demographic, behavioral, and psychographic segmentation.
The role of marketing segmentation in strategic marketing caters to find a common
need but will also find the different customers that have different needs. However, the
marketing strategies will also work if the management tries to target the specified needs,
where the marketing segmentation comes in (Wuryandani, Ismoyowati and Nugrahini 2018).
The advantage of this theory is that it brings in more focus within the marketing segmentation
which further encourages focusing on the specified target market as a unique business with
some unique offerings. On the other hand, the geographic expansion of the market can
expand the market immediately. Once the organization makes some effort to study the market
and reach about the population, the organization can quickly expand its production to the
nearby market and reach potential customers in new areas.
Targeting: The concept of target marketing is a strategy of marketing that breaks a
considerable market into smaller units intending to create a specified group of customers. The
organization caters to reach the potential and target customers instead of reaching to all the
customers, brand users and to the people who put their energy into connecting within a
specified group within the market (Wuryandani, Ismoyowati and Nugrahini 2018). However
target market is crucial because it enables the market and the firm to direct its sources and
choose the customers with high potential of sales growth and create interest with the product
or service and increase loyalty towards the brand. The below-mentioned points are evaluated
as the potential and commercial attributes for each of the segment. The perception of money
with this attribute the profit seems to exceed the additional cost and also includes the
marketing plan.
The target market in any organization caters to set an objective for the individuals
who share similar kinds of attributes that the organization hopes to serve. However, it is the
individual who usually becomes the end-user and is mostly to purchase the product
(Wuryandani, Ismoyowati and Nugrahini 2018). On the other hand, it is essential for the fir,
to reach up to the right kind of market or audience. This strategy is sometimes catered in the

8MARKETING THEORY
way with an instance of detergent advertisements where most of the commercial have moms
as their main character. This is the reason because the detergents are used for household
purposes.
Positioning: The positioning of the marketing concept outlines what the business
should do to the product or service in order to place it. Therefore the marketing department
builds an image for the product or service image on its intended audience. There are three
ways in which the product can be positioned and they are symbolic, functional and
experiential position. For example, Nike's positioning statement is “For serious
athletes, Nike gives confidence that provides the perfect shoe for every sport.” The
positioning statement for any organization must be simple and easy to remember so that the
customers can easily recognize the brand.
Internal and External Organizational Environment
The internal and external factors of the organization describe the various aspect of the
organization.
 The internal factor of the organization determines the mission and the purpose of the
organization to strata it is business. Therefore a successful organization caters to
create a clear sense of its ultimate purpose and also intends to fulfill the same.
 Secondly, the internal factor states the attribute of leadership, where it is the role of
the leadership which should be motivating and inspiring. However, it is the leader
who directs its employees to work hard and sets himself or herself as an example so
that the employee tends to follow them.
 The third factors of internal marketing strategy are communication, which is one of
the integral factors of the management (Hueske, Endrikat and Guenther 2015). With
the assistance of communication, the employer can build a healthy relationship with
its employees and can maintain an open-door policy where the employee can come
and share grievances or feedback.
 Lastly, the organizational structure states about the hierarchy in which it comprises
the leaders, the subordinates, and the employee.

9MARKETING THEORY
The external factor, on the other hand, deals with the factor that lies outside the
organization, which is economical, social, technological and political. The same internal
factors of the organization cater to support the management and its strategies are results of
the organizational relationship with the external environment (Hueske, Endrikat and
Guenther 2015). Whereas an organization with a clear sense of mission and vision can set
itself as an example to the world and align its managerial strategies with the positive element
in each of the functional areas.
Strategic Marketing Fundamental Issues
The fundamental strategic issues faced in strategic management are:
 Internal communication: the attribute of communication in marketing is the
conversation between the audience and the organization. Marketing is asked to
examine the key challenges and opportunities and later prioritize them and then come
to communication, which clears the challenges. The responsibility of marketing
strategy is similar to the HR department as the internal communication plays an
important role.
 Managing the peer leadership on other teams because the marketing leaders hold the
responsibility of managing the expectation that the stakeholders have for the
organization (Hueske, Endrikat and Guenther 2015). The marketing strategy must
involve the team’s performance as it showcases the brand to the public.
 Communicating a marketing vision within the marketing team is also significant but
holds the main challenge of aligning the marketing vision with the marketing team.
There should be a team where the challenges are narrated to the workers, and the
primary focus should be driven to overcome the challenges.
 However, the primary issue comes from unforeseen opportunities without a feeling of
chaos. In order to overcome this, the leaders of the marketing department suggest
maintaining a flexible organization that can take advantage of unforeseen
opportunities. However, these strategies must be directed during the project
management process.

10MARKETING THEORY
Conclusion
Thus from the above discussion it can be concluded that every organization must have
a strategic approach to its marketing, because it helps the business to reach its success by
achieving its mission and vision. The need for the strategic marketing is essential forlarge as
wella s small companies. Howver the most important role that the managers have to play in
this strategic planning is to take care of the company’s goals, which would eventually help
them to work for the approach. The steps of the strategic management theory or concept must
be aligned to the marketing process because this allows the managers to reach up to their
achievements. Knowing the target market, determining the position of the marketand
eventually the segregation of it are few of the objectives along with the technological and
environmental factors that help the companies to aim for a strategic market planning. Thus
any company. Be it having a narrow product line or having a greater rate of production, it is
important for everyone to take a strategical approach to the marketing.

11MARKETING THEORY
Reference
Cacciolatti, L. and Lee, S.H., 2016. Revisiting the relationship between marketing
capabilities and firm performance: The moderating role of market orientation, marketing
strategy and organisational power. Journal of Business Research, 69(12), pp.5597-5610.
Coccia, M., 2017. Sources of technological innovation: Radical and incremental innovation
problem-driven to support competitive advantage of firms. Technology Analysis & Strategic
Management, 29(9), pp.1048-1061.
Conley, T.G. and Decarolis, F., 2016. Detecting bidders groups in collusive
auctions. American Economic Journal: Microeconomics, 8(2), pp.1-38.
Davcik, N.S. and Sharma, P., 2016. Marketing resources, performance, and competitive
advantage: A review and future research directions. Journal of Business Research, 69(12),
pp.5547-5552.
Hueske, A.K., Endrikat, J. and Guenther, E., 2015. External environment, the innovating
organization, and its individuals: A multilevel model for identifying innovation barriers
accounting for social uncertainties. Journal of Engineering and Technology Management, 35,
pp.45-70.
Hunt, S.D., 2015. The theoretical foundations of strategic marketing and marketing strategy:
foundational premises, RA theory, three fundamental strategies, and societal welfare. AMS
review, 5(3-4), pp.61-77.
McDONALD, M.A.L.C.O.L.M., 2016. Strategic marketing planning: theory and practice.
In The marketing book (pp. 108-142). Routledge.
Patrutiu-Baltes, L., 2016. Inbound Marketing-the most important digital marketing
strategy. Bulletin of the Transilvania University of Brasov. Economic Sciences. Series
V, 9(2), p.61.
Rothaermel, F.T., 2016. Strategic management: concepts (Vol. 2). McGraw-Hill Education.