Business Strategy vs. Marketing Strategy

The difference between business strategy and marketing strategy is really just a matter of scope. Business strategy incorporates certain topics outside the realm of marketing, such as IT and organizational development strategies and it is broader as well. A business strategy would include making decisions regarding core competencies and, at a high level, the broadly-defined industries in which the company competes.

Marketing strategy is focused around generating demand and optimizing profits. In the process of crafting marketing strategy, the firm evaluates many different customer markets (defined by industry, job function, company size, etc.) and chooses how to differentiate vs. competitors. Armed with this decision, the organization can choose various initiatives that allow it to increase the effectiveness of its differentiation.

What Makes a Strategy "Great?"

A great strategy provides real differentiation vs. competition, and is granular enough to enable the company to derive strategic initiatives from it. It also enables the development of a strong value proposition — products, services and capabilities, and is driven by robust, statistically valid data about customers, competitors and prospects. And of course, it yields the required return to the business owners.

Differentiation means to offer something unique (i.e., "different") versus the competition. Effective differentiation requires:

• A thorough understanding of customer needs and perceptions
• A "difference" that is built on one or more compelling needs
• Sustainability
• Operational execution at least as good as the competition
• Carefully-constructed, persuasive messages that communicate the differentiation to customers and prospects

Inputs into Strategy Development

• Industry experts — You must have people on the team who know your business inside and out
• Transaction data — If available, you should study four or five years of customer transaction data to understand purchase behavior — do a multi-year "decile analysis"
• Market research, conducted with sound methodologies
• A trained facilitator

• Marketing Plan Development
• Segmenting Your Customers
• Developing Your Business and Marketing Strategies