Corporate vs. Marketing Strategy

• Corporate Strategy is an overarching strategy defining a company's mission, vision, and long-term goals with a focus on growth, market positioning, and resource allocation, including decisions on mergers, acquisitions, and diversification.
• Marketing Strategy, a subset of corporate strategy, aims to gain competitive advantage through marketing efforts, involving target markets, brand positioning, and the marketing mix (4Ps: Product, Price, Place, Promotion) to drive customer engagement and revenue growth.
• The four principles of marketing strategy are managing customer differences, managing customer dynamics, managing competitive advantage, and managing resource trade-offs.

Marketing vs. Corporate Strategy

• Corporate strategy focuses on the overall business direction and operations, addressing questions related to mission/vision, cash flow, and legal/policy considerations with a broad, company-wide perspective, aiming for business growth and sustainability.
• Marketing strategy centers on customer needs and market positioning, addressing questions about who the customers are and what value is provided, with a customer-centric perspective, aiming for customer engagement and revenue.

Sources of Customer Heterogeneity

• Individual Differences: Personal traits influencing preferences.
• Life Experiences: Past events shaping consumer behavior.
• Self-Identity/Image: How customers perceive themselves and want to be seen.
• Marketing Influence: Brand messaging and advertising shaping preferences.
• Environmental Factors: Culture, economic status, and social influences impacting choices.

Segmenting, Targeting, Positioning (STP)

• Segmenting: Dividing the market into groups based on shared traits.
• Targeting: Selecting the most appealing segment(s) to concentrate on.
• Positioning: Defining a brand’s place in the market relative to competitors.

Marketing Approaches

• Mass Marketing: Using a uniform message for all customers.
• Niche Marketing: Targeting a specific market segment with a focused strategy.
• 1:1 Marketing: Tailoring marketing efforts to individual consumers.

Brand Positioning Statement & Perceptual Matrix

• Brand Positioning Statement defines the unique value a brand offers to its target audience by addressing who the customers are, what their needs are, and why the brand is the best option to satisfy those needs compared to others.
• Perceptual Matrix is a visual tool showing how consumers perceive a brand against competitors, aiding businesses in spotting market opportunities and refining their positioning.

Customer Learning Effect

• Is the process where familiarity with a product increases the likelihood of future repurchases.

Stages of Product Life Cycle & Consumers

• Introduction: Focus on early adopters and building need awareness.
• Growth: Focus on increasing demand and differentiating the brand.
• Maturity: Broad adoption occurs, with focus on customer retention.
• Decline: Market shrinks, requiring product repositioning or discontinuation.

Acquisition, Expansion, Retention (AER)

• Acquisition: Attract new customers with brand awareness and promotions.
• Expansion: Encourage repeat purchases and increase customer engagement.
• Retention: Maintain customer loyalty and reduce churn.
• Customer segmentation helps tailor strategies to each stage in the lifecycle.

Approaches to Valuing Customers

• Lifecycle Approach: Focuses on customer needs at different stages of their journey.
• AER Approach: Separately targets customer acquisition, expansion, and retention.
• Customer Lifetime Value (CLV) Approach: Measures a customer’s long-term value, guiding investment in retention and loyalty programs.

Customer Lifetime Value (CLV)

• CLV predicts the total revenue expected from a customer over their lifetime.
• CLV determines the discounted value of sales and costs associated with a customer throughout their relationship with the firm.

Sustainable Competitive Advantage (SCA)

• A good SCA meets three criteria: customers care, the firm excels relative to competitors, and the SCA is hard to duplicate or substitute.

Sources of SCA: Brand, Offering, Relationship (BOR)

• Brand (B): Strong reputation and customer loyalty. Strongest in mature markets.
• Offering (O): Unique product/service features. Strongest in rapidly innovating industries.
• Relationship (R): Deep customer relationships and trust. Strongest in service-based and B2B industries.

Customer Equity Perspective

• Views customers as financial assets.
• Brand equity is the incremental preference a product gains due to its brand identification.
• Customer equity is the sum of the discounted lifetime values of all customers.

Challenges to SCA

• Imitation: Copying successful products or services.
• Disruption: Innovating to redefine the industry.
• Price Competition: Undercutting prices to attract customers.

Data Analytics

Chapter 2: Factor Analysis and Cluster Analysis

• Factor Analysis identifies underlying variables explaining customer responses and behaviors.
• Cluster Analysis groups customers based on similarities to improve segmentation and targeting.

Chapter 3: Hidden Markov Model, Choice Model, CLV

• Hidden Markov Model (HMM) predicts customer behavior patterns over time.
• Choice Model analyzes how customers make purchasing decisions.
• Customer Lifetime Value (CLV) quantifies the long-term value of a customer to a business.

Chapter 4: Experiments

• Experiments identify causal relationships between variables.
• Random assignment ensures equal likelihood of participants being in treatment or control groups.
• A/B Testing compares different marketing strategies to determine effectiveness.
• Field Experiments measure consumer response in real-world settings.
• Control and treatment groups measure the impact of a marketing strategy or intervention.
• Treatment Group: Receives the marketing change being tested.
• Control Group: Does not receive the treatment, serving as a baseline for comparison.