A marketing strategy is devised by the firm to know exactly where it stands in the competitive environment and what strategy it needs to implement to be one of the front runners in its respective industry. Overall, There are five main reasons to formulate a marketing strategy.
1) To form a long term and short term goal for the company – The first steps of marketing strategy involve forming the Vision statement and Mission statement of the company. Though both, the vision and mission are long term statements, Vision is used more for what the company wants to achieve throughout its existence whereas Mission statement is more of an action plan of how the company will achieve its vision. Thus while forming marketing strategy, the firm decides on its vision and mission.
2) To get an internal analysis and competitive analysis – The second step in the formulation of marketing strategy is the internal analysis of the firm which helps the firm in deciding what resources it has and whether or not there is optimum utilization of resources. At the same time, the firm may also conduct competitive analysis. By comparing both the above form of analysis, the firm can determine its exact standing in the industry; which areas the company is weak in and where it is strong.
3) For targeting the right customers – Once the company knows its resources and its standing in the industry, it can use the information to form the correct marketing mix and to define the right market segment. This in turn can help the organization in targeting the right customers for its products. This can be possible only if the previous two steps of marketing strategy are achieved.
4) To have a tactical advantage – Tactics are decided based on the short term goals of the company. However, tactics can become dangerous if not implemented in the right manner. Thus the sales and marketing tactics of an organization should be in line with the marketing strategy or the marketing plan decided by the management. For this, a marketing strategy needs to be in place as a guideline for the managers.
5) To implement the vision of the organization – A marketing strategy is needed not only to form a vision for the organization but also to ensure that the vision is achieved in the long duration. Everyone can have a vision, but the vision needs to be realistic and achievable. Thus based on the marketing strategy, the right plans need to be implemented such that the vision of the organization is realized.