2.8 Defining Strategic Marketing

The terms ‘Marketing Strategy’ and ‘Strategic Marketing’ are often used interchangeably, albeit incorrectly. In one of his very influential articles, Professor Rajan Varadarajan (Varadarajan 2010; p. 120) delineated the difference as follows:

‘In the management discipline, the term strategic management refers to the field of study, and corporate strategy (strategy at the firm level in a multi-business firm) and business strategy (strategy at the business unit level in a multi-business firm) are among the organizational strategy constructs that are the focus of the field. However, in the marketing discipline, the terms strategic marketing and marketing strategy are used interchangeably in reference to the field of study, and marketing strategy is also used in reference to the organizational strategy construct that is the principal focus of the field.’

Thus, the correct way to use these two terms seems to be – to use ‘strategic marketing’ when referring to the field of study, and use ‘marketing strategy’ when referring to the organizational strategy construct.

Characteristics of Strategic Marketing Decisions:

According to Varadarajan (2010), strategic marketing decisions could be viewed as as a firm’s marketing-related decisions that are of major consequence from the standpoint of its long-term performance. Reflecting the discussion about ‘Strategic Decisions’ in Chapter 2.5, strategic marketing decisions …

• focus on the achievement of a competitive cost and/or differentiation advantage
• involve resource commitments over a relatively longer term, that are spread over a relatively longer time period
• entail tradeoffs and decision tensions
• involve interdependence across contemporaneous marketing decisions, interdependence with decisions of other actors, and intertemporal  interdependence
• involve resource commitments that are either irreversible or relatively difficult to reverse (Ghemawat 1991), and are relatively larger in magnitude

Further, strategic marketing decisions also specify the marketing actions or
marketing activities or marketing behaviors to engage in (in the marketplace).

• Marketing activities: According to Porter (1996) , strategy is about activities, i.e., a business’ decision to perform different activities and/or perform specific activities differently relative to its competitors. According to Day et al. (1990), marketing strategy focuses on marketing activities and decisions related to building and maintaining a sustainable competitive advantage.
• Marketing behaviors: According to Mintzberg (1987), a statement of strategy that is future-focused is an explicit guide for consistent future behavior of
  the firm.

So, what is Marketing Strategy, then?

Based on the above discussion, marketing strategy could be viewed as ‘an organization’s integrated pattern of decisions that specify its crucial choices
concerning marketing activities to perform and the manner of performance of these activities, and the allocation of marketing resources among markets, market segments and marketing activities toward the creation, communication and/or delivery of a product that offers value to customers in exchanges with the organization and thereby enables the organization to achieve specific objectives’ According (Varadarajan 2010; p. 130).

Reference:

Varadarajan, R. (2010). Strategic marketing and marketing strategy: domain, definition, fundamental issues and foundational premises. Journal of the Academy of Marketing Science, 38, 119-140.

Ghemawat, P. (1991). Commitment. Simon and Schuster.

Porter, M. E. (1996). What is strategy?

Mintzberg, H. (1987). The strategy concept I: Five Ps for strategy. California management review, 30(1), 11-24.

Source:

Section 1.1 Defining Marketing, Section 1.2 Who Does Marketing? and Section 1.3 Why Study Marketing? are edited versions of the chapter sections of the same titles appearing in ‘Chapter 1: What is Marketing?’ of the textbook ‘Principles of Marketing,’ authored by University of Minnesota Libraries Publishing edition, 2015 – this book was adapted from a work originally produced in 2010 by a publisher who has requested that it not receive attribution.

The following changes were made to the most recent edition: Created new title for Figure 1.1: Marketing activities; Created new title for Figure 1.2: Creating Offerings That Have Value – BMW versus CRV; Created new title for Figure 1.3: Creating Offerings That Have Value – Social media sites; Added learning objectives for sections 1.1, 1.2, and 1.3.