Practical Marketing Strategies

From my personal experiences as a marketing student and later as a lecturer in Marketing with the Chartered Institute of Marketing, Ghana, I have realized that most text books are awash with foreign examples that are sometimes difficult for students to grasp. Marketing as a course is clearly related to our ‘day-to-day’ activities and it should be as practical as possible and full of fun.

The essence of marketing is the delivery of customer-centric solutions to maximize the achievement of organisational goals. Every organisation exists to offer some form of solution to its target market and those solutions can be in the form of products or services. 

Marketers should therefore devise strategies to help the organisation to improve its internal weakness and use its identified strengths to exploit the opportunities in the external environment and minimize external threats.

Competitor Strategies (Position-based)

Position-based competitor strategies originated from military strategies and they are strategies that organisations can deploy to fight their competitors. The type of strategy the players deploy depends on their market position/market share. Theoretically, players in the industry are classified as market leaders, challengers, followers and nichers with 40%, 30%, 20% and 10% market shares respectively. Some of the competitor strategies that will be discussed include; flank defense, frontal attack and encirclement attack.

The focus of a flank defense or attack is for the company to protect its flanks (weakness) or attack a competitor’s flanks.

Within the radio broadcast industry, the Multimedia Group has been able to deploy a flank defense and an encirclement attack effectively. The liberalization of the airwaves by the National Communications Authority (NCA) in 1994 resulted in the proliferation of various privately-owned Frequency-Modulated (FM) radio stations in the country. What can be termed the “mad-dash” to tune in started in 1995 with the introduction of Joy FM and subsequently, Radio Gold. The FM stations broadcasted only in English and were deemed to be only for the educated Ghanaian. Then in 1999, Akan-speaking radio station Peace FM stepped in and became the widest tuned-in radio station. Joy FM was faced with a dilemma as to how to compete head-on with Peace FM so the Multimedia Group strategically acquired Adom FM (a local content radio station), and used it to pursue two basic competitor strategies; Frontal attack and Flank defense.

Finally, the Multimedia Group launched an encirclement attack by launching various brands into the radio broadcasting market to cater for various segments of the market. For example, they launched Hitz FM for the music-loving youth and Asempa FM for sports-loving fans, to compete more effectively with the likes of Happy FM.

A bypass strategy involves using superior technology to leapfrog a competitor or serving markets that competitors are currently not serving. A classic example within the Ghanaian corporate environment is the “analog-digital” saga in the telecommunications industry. Mobitel (Now Tigo) was the innovator in the mobile telecommunications market, but it entered the market with analog technology. Spacefon (now MTN) entered the market with digital technology, which gave consumers the option of changing their handsets, and overtook Mobitel as the market leader - a position it has defended tenaciously for many years.

Porter’s Competitive Strategies 

Porter (1980) argues that for organisations to compete effectively in the marketplace, they must pursue one of three distinct generic strategies; cost leadership, differentiation and focus. Though various alternative combinations have been proposed and the three generic strategies have been extended, I will stick with these three for the purposes of this illustration.

Cost leadership strategy is normally deployed by firms who intend to use low price as their basic competitive strategy. In Ghana, the most recognizable example is Melcom, whose competitive advantage and competitive stance is based on low price.

Differentiation involves providing a superior and distinct product that is clearly different from that of competitors. The uniqueness should be relevant to the target audience to the extent that they will be willing to pay a premium for it. In Ghana, consumers are willing to pay about 5x the market prices for drinks hang-outs at upscale pubs like Rhapsody and Citizen Kofi because they place premium on the ambience.

Focus or Niche strategy involves identifying a narrow segment of the market with an unmet need and then producing products and services to serve the needs of that specific segment. The segment must however be substantial enough to be profitable.

One classic example is UT Financial Services (Now UT Bank). Many years ago, the Ghanaian importer and other businessmen had problems raising quick loans to clear their products from the ports or to take advantage of lucid business opportunities as the banks were relatively slow to grant loans.  UT Financial Services was established to offer quick loans to serve the peculiar needs of this target segment. It positioned itself as “a loan in less than 48 hours” and delivered consistently on its brand promise.

Conclusion

Most marketing strategies and concepts are related but the key differences hinge on the context and rationale underpinning their usage. Marketing is an exciting course and lecturers and practitioners should ‘practicalize’ and domesticate it as much as possible to bring the concepts to life.

By: Nana Yaw Kesse