Role of Strategic Marketing in Dell - Term Paper Example

? Strategic Marketing: DELL Role of strategic marketing in Dell Strategic marketing plays an important role for an organisation in determining the choice of right output for bringing such outcomes that serve the needs and purpose of customers. Marketing process helps in identification, anticipation and fulfilment of the needs if the users. Dell tends to satisfy the needs of the users in accordance with its existing missions and values. With the help of strategic marketing, organisations tend to ensure future growth and sustainability. Strategic marketing is done by organisations in shaping and positioning their brand thereby gaining competitive advantage. In this manner, strategic marketing tends to shape the corporate strategy of organisation and providing an inducement for innovation and growth (Blythe 2000). Strategic marketing involves creation of a marketing plan for the Dell to assess its current status regarding the product, pricing, distribution and promotional strategies. Strategic marketing is undertaken by organisations for the purpose of developing business plans that aim at meeting the needs of the customer, the channel or the consumer. With the help of these business plans Dell tends to assess the needs of its customers, the competitive environment and its own competencies. Strategic marketing leads to the assessment of the relationship of Dell with the external business factors like level of competition, target market, development of sales objectives, and strategies for achievement of goals. Dell uses strategic marketing in meeting the objectives of discovering new channels, products and services for fostering growth and making its existence in the market. Strategic Marketing Process The process of strategic marketing involves a five step procedure. It involves a process of planning for the purpose of setting a clear direction and identical purpose that meets the efforts of the marketing strategy of an organisation (Stanco 1996). The first sep starts with identification of the mission, which is followed by the analysis of situation, then objectives are determined for which a marketing strategy is developed and finally evaluation of the plan is done in order to identify the effective functioning of the strategy. Identifying the Mission The first step involves identification of the mission and purpose of existence of the organisation and its purpose of meeting the objective of providing benefit to the customers in the long run. This mission statement involves anticipation of future in the long run and analyse the existing importance of the organisation’s product, service and level of expertise. Situation Analysis This is the second step in which organisations conduct an analysis of the existing situation in order to set the strategy in accordance with the current situation. The situation analysis involves SWOT analysis in order to set priority for determining the strengths, weaknesses opportunities and threats that exist in the organisation. This process enables understanding among the managers regarding the resources that they can build for their organisation and the challenges that they may come across. Strengths and weakness of the organisation are the internal factors and are under the control of the organisation. On the other hand, opportunities and threats are the external factors that outside the boundary of organisational control (Ferrell 2010). Objectives This is the third step of strategic management process, which involves setting of organisational objectives, on the basis of which the marketing strategy of the firm is to be developed. It is important to identify and develop goals that are specific and measurable and provides a basis to the decision makers for making choices and analysing the progress of organisation. These objectives can be in terms of quantitative as well as qualitative goals like revenue, profits, market share and sales of the company. It is important to determine such objectives that can be accomplished within a given period of time. Strategy and Evaluation This step involves development of strategy for the achievement of organisational goals. The development of strategy involves selection of a target market, a distinct section of consumers who have the greater likeliness to purchase the product. In this stage, tactics regarding the implementation of strategy are also decided so that an effective use of the market mix tools like product, promotion, price and distribution can be made and buyers can be attracted to purchase the product. After the strategy is developed and implemented an effective evaluation is necessary in order to determine and monitor the progress of the strategy towards the achievement of organisational goals. Relationship between Strategic Marketing and corporate strategy There is a specific relationship between marketing strategy and corporate strategy. The focus of corporate strategy is to determine the overall purpose of the organisation. It also determines the range of activities that an organisation must undertake. It relates to the market in which it should operate (Canzer 2006). It helps in determining the strategic direction of the organisation to prevent the risk of marketing myopia. In this manner, corporate strategy helps in determining the marketing strategy of the organisation to ensure that organisation is able to meet the changing needs of the market. Models used in Strategic Marketing Planning There are many models which are used by the businesses for the purpose of strategic marketing planning. Major models include the BCG matrix, Product life cycle, Ansoff matrix. Etc. the selection of the strategic model depends upon the requirements and demand of the company. The company may make use of strategic models for the purpose of devising such plans with the aid of which it is able to gain competitive advantage in the market. In the context of selected company, i.e. Dell, it has been analysed that the company lays stress on use of these models in the organisation for the purpose of strategic marketing planning (Nag 2008). The major models whose value will be assessed in this paper include the BCG matrix and Product life cycle. BCG matrix is an uncomplicated tool which is used for the purpose of evaluating the position of the company in terms of its products. It provides a clear thinking about the product and services it should continue to invest in, which it should disinvest or harvest. The four phases of BCG matrix include question marks, stars, dogs and cash cows. The BCG model in context of Dell Company is very much applicable. It is functioning at the global level including America, Europe, and Asia-pacific. The company is earning high revenues in all three countries. The BCG matrix evaluates the market structure on the parameters of market share and market growth. The company is at present status enjoying the 100% growth rate from its three major territories. Along with this the relative market share of the company is around 95% out of which the majority of market share is coming from its American market (Etzel 2005). Thus, this model is highly valuable for the company since it is providing a help in making the final decision regarding investment, divestment and harvesting. Along with this another dell which is very helpful for the company is the PLC model. The product life cycle of the company is relatively short in nature and because of this sprinkler strategy is most favourable. Dell and its product have a short PLC in the market. The major reason behind this is the nature of the product the company is offering. Dell is a technology oriented company it is very important for the company to introduce new and innovative products on the market in order to effectively handle the competition and the competitors. The company can only handle the competition with the aid of innovation. The majority of the products if the company that have been introduce off lately in the market indicate that the company has complete knowledge about the innovation and its use and this is the reason for the shorter life span of its products (Simkin and Dibb 2008). The PLC has been helpful for the company since it is able to easily understand when to take steps for introduction of new products and such steps are taken as soon as one product is about to reach the decline stage. Strategic Positioning and Marketing Tactic The term of strategic positioning and marketing tactic are overlapping in nature. The strategic positioning has an important role to play in setting the objectives and goals of the business and defines the platform for effective communication. It also dictates the marketing mix and its strategies which are to be used by the business. Marketing tactics have the main focus of product, price, place and promotion and it can also be tailored for specific requirement of the products and the markets of the company (Graham 2008). Relationship Marketing in Dell Relationship marketing is the strategy which is used by the company with an intention of fostering customer loyalty, building interaction and long term engagement. The focus of relationship marketing is on customer retention not on acquisition of customers. Dell as a company has been able to build such a sting position in the market as a result of its strategies and activities which it undertakes for building effective relationships with its customers. The company has the main focus on the customers and on fulfilling their requirement and expectations. The company lays high focus and is the best in the industry when it comes to delivering customized products and services to the customers. Along with this Dell is also highly concerned that it does not bother its customer approach and rather than calling the customer to the stores it believes in providing high class online services which are easier and convenient for the customer to practice (Brink et al. 2009). The marketing strategy of the company is well versed with the relationship marketing. Since the company has always been focussed on delivering what consumer expects it is able to fulfil the requirements of both its marketing strategy and relationship marketing. Thus, it is clear that Dell as a company has a strong base in relationship marketing and has been able to ensure the growth of the market and its profit because if its actions towards maintaining healthy relations with the customers (Brink et al. 2009). Impact of External Environment on Marketing Strategy Marketing strategy of an organisation relates to understanding the opportunities and threats that an organisation may face. With the analysis of external environment organisation tend to identify the strategies and understand the need of the changing business environment. External environment is important to be analysed as it has a direct influence on the marketing strategy of the company. These factors may pose opportunities and threats for an organisation (Proctor 2000). Dell has a global strategy and believes in staying closer to the customers for carrying its marketing strategies in an effective manner so that a loyal customer base. It has enabled an internet based infrastructure for the purpose of booking and giving orders, which has led to an increase in its customer base. It has enhanced its arena of marketing strategies in new offices. It has been working as a niche market and has led to the reduction in the competition by adopting collaboration. It does not believe in taking over its existing competitors in order to eliminate. It has also gone for partnerships and association in order to adopt the concept of integrated marketing (Ignatiuk 2009). An example in this case is the association of Xerox with Dell as a partner for the provision of printing products and services is the example of integrated technology in the business. The association of dell with Xerox has led to the ability of the company to serve its customers with a full range of printing technologies that are used for the office purpose. The company also believes in global collaboration as it has its offices in different countries and works in an effective manner. Marketing strategy options in a market: Differentiation strategy Differentiation strategy involves development of products and services in such a manner that it can offer a unique image to the customer in the marketplace. It involves offering of a product in a manner that customer would prefer that product over the other options. The products offered by Dell have certain unique attributes that make them stand ahead of the competition. Any increase in the price of the product will have to be borne by the customers as there won’t be any substitute with the same attribute that is available in the market (Daft 2009). Dell deals with its customers on the basis of direct to consumer model, and this is its differentiation strategy. The idea behind this strategy of Dell to offer products directly to the customers is to have a better understanding of the needs of the customers. This direct business model adopted by Dell leads to elimination of retailers and finally reduces the unnecessary time and costs. Marketing Objectives of Dell The marketing strategy of dell aims at listening to the needs and demands of customers and having an effective interaction with them in local languages of their region. Dell believes that these interactions with the customers provide a positive input and thereby improve the services, products and processes provided to the customers. This ultimately leads to the strengthening of organisation and customer relationship and build a feeling of trust among the customers regarding the quality of products and services (Bamford 2010). In this manner, the marketing strategy of Dell aims at enhancing its operations and services in different countries on a global scale and provides effective and best quality services to the customers around the world. Impact of Changes in the External Environment on a Marketing Strategy For the purpose of effective external environment analysis of the strategy of the company it is very important that PEST analysis of conducted. The first element of this analysis is the Political. The political environment is highly influenced by the political parties and ideologies of the government. Dell computer are subject to laws of the political environment in the aspects of health safety, pollution, and advertising and labelling requirements. The company sees high chances of establishment in the market where there are lesser political laws and liberal working conditions (Henry 2008). Economic environment basically indicates aggregate nature of economic system of the country in which the company is operating. Dell expects a growth of 10% in the next five years. The growth of the company is highly influenced by the economic situation of the specific country. The changing inflation rates and fluctuation in currency also make an impact on the profitability of the company. The exchange rate of the home currency also makes an impact on the industry in which the company is operating. On the basis of changing economic condition it is clear that the company is expecting growing market for higher quality and priced computers (Henry 2008). Social environment and the values of the country also affect the functioning of the business. This environment includes groups of people, number, characteristics, behaviour, etc. The demands of the Asian countries are increasing and for responding to changes the company had to make investment in door-to-door operations for gaining faith of the customers in the products of the company (Krasel et al. 2006). Dell has been highly responsive towards the social requirement of the country in which it has been operating. The technological factors mainly include factors and trends that make an impact on the new products of the company. The trends can offer the company the opportunities for the new product development, manner in which marketing activities are performed. The company has been able to increase familiarity with latest technologies in order to provide the best services to the customers. The major problem which is faced by the company in technology related aspects was in China which is because of the cost of the accessing the internet the internet is very costly (Henry 2008). Though the company has been facing challenges from the external environment it has been able to successfully overcome these challenges and create a strong image in the markets in which it is operating. Internal Analysis of Marketing Strategy of Dell For identifying the strengths and weaknesses of the company an internal analysis conducted with the aid of SWOT model. The major strengths of the company are invention, well controlled relationships with suppliers, use of direct model, main target business executives’ category. The weakness of the company low sales revenue from educational institutions, unable to target the college students and buyers are not able to touch and feel the product before the final purchase. Along with this, opportunities for the company include increasing communication with customers, technological integration, and growth in the laptops markets. The threats faced by the company are related to small price differences, slow down in the growth rate, competitive rivalry in PC world (Schwie?elmann 2010). Recommendations for Strategic Marketing The major recommendations which can be adopted by the company in order to comply with the key emerging these are associations with social marketing. The company can make use social marketing prospects for the purpose of advertising and gaining higher level of acceptance among the customers. Social marketing will play an important role in helping the company to win competitive advantage. This type of marketing will play an important role in making positive contribution in profit level and market share of Dell. References Bamford, C.E. 2010. Strategic Management. Mason: Cengage Learning. Blythe, J. 2000. Strategic Marketing. UK: Select Knowledge Limited. Brink, A. et al.2009. Relationship Marketing & Customer Relationship Management. CA: Juta and Company Ltd. Canzer, B. 2006. E-Business: Strategic Thinking and Practice. Mason: Cengage Learning. Daft, R.L. 2009. Organization Theory and Design. Mason: Cengage Learning. Etzel. 2005. Marketing. US: Tata McGraw-Hill Education. Ferrell, O.C. 2010. Marketing Strategy. Mason: Cengage Learning. Graham, H. 2008. Marketing Strategy And Competitive Positioning. US: Pearson Education. Henry, A. 2008. Understanding Strategic Management. US: Oxford University Press. Ignatiuk, A. 2009. Analysis of Dell's Business Strategy. Germany: GRIN Verlag. Krasel, M. et al. 2006. The Dell Company - A Strategic Analysis. NY: GRIN Verlag. Nag. 2008. Strategic Marketing . US: Macmillan. Proctor, T. 2000. Strategic Marketing: An Introduction. NY: Routledge. Schwie?elmann, J. 2010. Dell: Can Rivals Beat Its Strategy? NY: GRIN Verlag. Simkin, L. and Dibb, S. 2008. Marketing Planning: A Workbook for Marketing Managers. US: Cengage Learning. Stanco, J.P. 1996. Utilizing the Strategic Marketing Organization: The Modernization of the Marketing Mind Set. NY: Routledge. Read More