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1-2-2 Marketing Strategy

Marketing strategy is a strategy that is created on the basis of Positioning of STP analysis. This subsection describes the strategy that is in line with the seller’s perspectives (4P) in the marketing mix.

(1) Product strategy

Product strategy is a strategy related to products, such as the functions, quality, design, brand, product line, services, and guarantee. Brand strategy is also one of the product strategies.

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In the product strategy, the market growth rate and market share of the product are analyzed on the basis of the product portfolio, and the main policies are decided depending on the stage of the product life cycle in which the product is at the moment.

(2) Price strategy

Price strategy is a strategy that is related to price, such as the retail price, wholesale price, standard price, discounted price, trading conditions, payment due date, margin transaction conditions, and allowance (e.g., support money for advertising objective). In the price strategy, the sales price of products is decided according to the following price setting methods.

Type	Setting method	Sales price setting method
Cost-oriented	Cost plus approach	The price is set by adding a fixed profit to the cost.
	Markup approach	The price is set by adding a profit to the cost price.
Competition-oriented	Market price following approach	The price is set by focusing on the market price range.
	Price leader following approach	The price is set according to the price of the company that leads the industry.
Demand-oriented	Price differentiation	Several prices are set depending on the condition.
	Prestige price approach (premium pricing)	A high sales price is set by using the consumer psychology that high

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quality equals a high price.

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At this time, the price setting that satisfies both the consumer needs and the desired profit of the company between a high pricing policy (i.e., fast recovery of cost) and a low pricing policy (i.e., penetration in the market) is called value pricing. Moreover, since the sales price is closely related to product satisfaction (i.e., cost performance/cost effectiveness), matching it with the customer needs through discount amount and payment terms is also examined. Stable purchasing power regardless of the price implies a low price elasticity.

(3) Distribution strategy

Distribution strategy is a strategy related to distribution, such as the sales area, selection of goods, store location conditions, inventory, delivery, and distribution base. The distribution strategy must correspond to the form (i.e., distribution structure) in which products are delivered to the consumer. The distribution structure is not just limited to in-store sales, but is diversified, including mail orders and electronic transactions using the Internet, and franchise chain. A franchise chain is a company integration that the head office provides the goodwill or trademark usage rights, and opening and providing management knowhow to the member stores, and in exchange collects loyalty (i.e., membership fees). A mutually dependent organization concerning distribution (a process that enables the acquisition or consumption of products and services) is called a distribution channel (or marketing channel). There is also a concept called channel integration by which the entire distribution channel is perceived in an integrated manner. Channel integration is a technique of providing better distribution services (e.g., right product, right time, right quantity) to the customer. · 1 question

(4) Promotion strategy (advertising strategy)

Promotion strategy (i.e., advertising strategy) is a strategy related to sales activities, such as advertising, PR activities, sales promotion, direct mail, and over-the-counter sales. Promotion strategy is an advertising strategy and sales promotion activity for informing the consumer about the characteristics of the product and increasing intention to buy. Moreover, publicity (e.g., reporting on products and services) in various types of media is also an important element. With regard to advertising, it becomes important to create an organizational and management structure to ensure that infringement of the below-mentioned rights does not happen.

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(5) Marketing concept

The marketing concept is a concept that marketing is positioned as a core function of corporate activities because acquisition and retention of customers is the main focus of corporate activities. This is also referred to as the concept of complying with the customers’ needs by offering a favorable environment surrounding the products rather than considering the production of good products as the core activity. Therefore, the marketing strategy includes not only the product strategy, but also the price strategy, distribution strategy, and promotion strategy.