Business Marketing Strategy
A business marketing strategy is a process or a set of principles that enable a company to concentrate its limited marketing resources on the opportunities that will best improve sales and achieve a competitive advantage. Like other leading business schools, INSEAD carries out a great deal of teaching and research in the field of marketing. But it is also the place where the famous Markstrat simulation – used throughout the world to teach marketing strategy – was developed. In the following interview, Professor of Marketing, Jean-Claude Larréché, inventor of Markstrat, gives his views…
How has business marketing strategy changed since you developed your first simulation back in the 1980s?
The ultimate objective of a company’s marketing strategy used to be to become number one in terms of size or market share. Today it’s much more ambitious. It’s about being number one in the future – innovating to create valuable new solutions to problems that the customer hasn’t yet realized exist!
Is this change for the better?
I think so. When I started out in this field, marketing managers used to measure their success by the size of their budget. They were always trying to outspend the competition. Nowadays it’s much more about using brain power – often to avoid spending too much money!
What are today’s really hot topics?
Although the field appears to have changed very rapidly in the last decades, for example because of new technology and new social media applications, the fundamentals are still the same. If social media is important, it’s because it’s a new way to create customer engagement – which always was one of the keys to success.
So what are the other keys to a successful business marketing strategy?
I have a very small, simple framework, which has a big, complex impact if properly used. You start with discovery – of the customer’s world, what they want and what they haven’t yet realized they want. Then you craft a power offer – using the insights discovered to create a product or service that truly delights the customer (the iPhone is an obvious example). The result should be the customer engagement I mentioned before, which enables you to promote your product by word-of-mouth, rather than by an expensive marketing push. Put these three elements together and you get quality growth, which should be the ultimate aim of any business marketing strategy.
Isn’t growth a dirty word these days?
It’s true that the world as a whole can’t afford the kind of economic growth we’ve experienced in the west over the last 50 or 60 years. But we shouldn’t confuse the kind of economic growth that wastes the planet’s resources with the growth of an individual company. If a company doesn’t grow, it ends up dying. On the other hand, just like the planet, a company’s growth should be focused on sustainability – and not wasting resources. That’s why I said quality growth.
How has Markstrat itself grown and developed over the years?
We’ve made sure that it has evolved from the days when marketing simply consisted of the 4Ps! In fact we’re continually enhancing it to make sure that it still provides a realistic, simulated environment where managers can learn, test their understanding, develop a new mindset – and most of all do their job differently and better when they get out of the classroom and back to work.
Learning more at INSEAD
Discover more of Jean-Claude Larréché’s insights by applying for a place on the Executive Education programme that he directs, Powering Growth. It also includes a new simulation, based on the Markstrat model – but going beyond marketing excellence to include innovation and production. In the meantime, you can learn more about Professor Larréché’s views, in his book The Momentum Effect.