In a classic Harvard Business Review article, Ansoff (195) identified four strategies for business growth. These strategies also identify four basic types of marketing plans and the types of investments and activities associated with each. Strategies are defined based on whether the focus is on new or existing products and on new or existing markets. When a company focuses on selling its current products to existing customers, it is following a strategy of market penetration.
The marketing activities that will predominate in this type of marketing plans are those that emphasize increasing the loyalty of existing customers so that they are not vulnerable to losing to the competition, attracting competing customers, increasing the frequency of use of the product and converting non-users into users. Efforts to expand sales by selling current products in new markets are known as a market development strategy. Such efforts may involve entering new geographical markets, such as international markets. Raising product awareness and developing distribution channels are key marketing activities.
Some product modifications may be required to better meet the needs of the local market. For example, as fast food restaurants have moved to international markets, they have often changed their menus to better suit the dining preferences of local market customers. Expanding to a new market with an existing product involves a certain risk because the company does not know the new market well and the company and its products are not well known in the market. The return on marketing investments in such a strategy is likely to be longer than in a market penetration strategy, due to the time needed to raise awareness, distribute and test the product.
Creating new products to sell to existing customers, a product development strategy, is a common marketing strategy among companies that can leverage their relationships with existing customers. For example, American Express has been able to leverage its relationships with its credit card customers to also sell travel-related services. Similarly, cable television companies have expanded their offerings to Internet and telephone services. Research and development activities play a key role in this strategy.
The time needed to develop and test new products can be long, but once a product is developed, awareness, interest and availability should be relatively quick, since the company already has a relationship with customers. A product development strategy is also riskier than a market penetration strategy because it may not be possible to develop the necessary product, at least at a cost acceptable to customers, or because the product developed does not fit customer needs. A diversification strategy involves bringing new products to new markets. This is really the creation of a completely new business.
This is the riskiest strategy and will likely require more patience while waiting for a return on investment. Cause marketing, also known as cause-related marketing, links a company and its products and services to a cause or social problem. For dynamic pricing to work effectively, companies must collect and analyze data from a variety of sources, such as customer behavior, sales history, and market trends. From the examples of marketing strategies above, SEO content should almost always be included for its appreciative value and its lasting impact.
However, in spite of all the changes that have taken place in marketing over time, one thing remains true: The 4 P's of marketing - product, price, place, and promotion - still provide an effective framework for creating successful marketing strategies and programs. This allows marketers to better understand each customer and create detailed customer profiles, and allows brands to attract customers with relevant content at the most important moments. It's also a strategy in which marketing investments should pay off more quickly because the company is based on an existing base of customer relationships and product knowledge. So what differentiates your product from other similar products on the market? How can you win over customers and beat the competition? The key to this marketing strategy is to determine what makes your product unique or special.
Outbound marketing campaigns require your company to directly address your target audience (think cold calls or email campaigns). Relationship marketing focuses on customer retention and satisfaction to improve their relationships with existing customers and increase their loyalty. On the other hand, inbound marketing campaigns give your audience a reason to reach out to you and start a conversation (think blogs or social media content).