“The search for success factors is what the enterprise of strategy has largely been about”
Ghemawat (1991) Introduction Business organisations are constantly seeking ways to enhance their performances in order to compete actively and aggressively in the market. Profit-seeking organisations have long recognised the importance of creating value in the products and services they offer to the customers, all in the common objective to deliver commercial goods efficiently in order to keep the current customer-base satisfied. Aside from inculcating loyalty among the members of the clients and customers of a business organisation, companies are likewise aware of the need to widen and extend the reach of the company’s products and services to new markets in order to increase its share on clients and customers. Strategies, plans and techniques in the areas of operations, communication and marketing, sales, supply chain, logistics, research and development, performance measurements as well as social and corporate obligations and responsibility are continuously improved all for the benefit of the target market. Once companies become successful in these organisational and managerial areas, sustained economic development is envisioned. This literature review aims to present a critique of existing, published literatures that analyse the relationship between marketing strategies and the firm’s performance. Historically, marketing strategy formulation is viewed as an antecedent to performance outcomes (Lages 2000). 2000). It is the modus operandi that allows an organization to concentrate its limited resources on the best available opportunities to increase sales and achieve a sustainable competitive advantage (Michael Baker 2008). 2008). Marketing strategy has been a salient focus of academic inquiry since the 1980s, according to (Mavondo 2000). 2000). There are numerous definitions of marketing strategy in the literature and such definitions reflect different perspectives (Li (Li et al 2000). 2000). A traditional definition of marketing strategy is a plan for pursuing the firm’s objectives or how the company is going to obtain its marketing goals with a specific market segment (Orville ( Orville and Walker 2008; Theodosio, Leonidus, 2003; Kotler, Armstrong, 2009) 2009) while Brodrechtova (2008 (2008)) explains that marketing strategy is a roadmap of how a firm assigns its resource and relates to its environment and achieves corporate objective in order to generate economic value and keep the firm ahead of its competitors. In laymen terms it is to determine the nature, strength, direction, and interaction between the marketing mix-elements and the environmental factors in a particular situation (Li (Li et al 2000). 2000). According to Levie (2006 2006), ), the aim of the development of an organization’s marketing strategy development is to establish, build, defend and maintain its competitive advantage. A thorough analysis of the newest scientific articles on strategic management and organisational behaviour indicates that 71% of them analyse company performance as a dependent variable, 12% of them analyse it as an independent variable while 11% of the studies analyse performance as a dependent as well as an independent variable (March ( March and Sutton 1997). 1997 ). Firm’s performance, performance, on the other hand, is a well established measure in marketing literature. We measure it through sales volume, profitability and market share for the current period (current firm performance), and perceived satisfaction with these measures when considering the previous year. (Past firm performance)
Four papers that are discussed in this review, discuss different strategies and their effect on a firms performance. firm’s performance: E-marketing Strategy and firm’s performance:-
As of 31 December 2011, 2.267 billion people worldwide had access to the internet according to http://www.internetworldstats.com/stats.htm.. It has assumed an important channel for marketing and http://www.internetworldstats.com/stats.htm distribution of products and services. That is, primarily, due to the cost effectiveness of the internet as well as convenience for customers when it comes to ordering and browsing. A company can also reach out to a broader customer base at a relatively low cost. The first paper, The Relationship between E-marketing Strategy and Performance: A Conceptual Framework in a Web Context proposes a conceptual framework that links the five factors; internal forces, the external forces, past web and firm performances, current web (including firm performance) and the 4W’s E-marketing strategy (Web-Design, Web-Promotion, Web-Price, and Web-CRM).
It basically explains that the best strategy across situations does not exist. Performance levels result from the co-alignment among strategy and the firm’s context i.e. the internal and external forces. The identifications of current market position in the web are an essential issue. Although many ecommerce companies collect cost and usage data about their websites, few of them understand in any detail how well such information measures their sites performance. Since the year 2000, investors have been insisting, if not on profits, at least on objective measures of a sites success in attracting, converting and retaining customers. McKinsey’s study (Kemmler et al., 2001) 2001) shows that while the performance of internet retailers is improving, i mproving, most media and content sites are going down. Export Marketing Strategy Strategy Determinants on Firm Firm Export Performance:Performance:According to Cavusgil and Zou (1994), (1994 ), export marketing strategy can be defined as “ the means by which a firm respond to interplay of internal and external forces to meet the objective of the export venture”. The growing of global trade and sales activity in the world has increasingly accentuated the importance of exporting for firms and countries alike. Globalization process, global market competition and the subsequent performance difficulties encouraged by exporters cause the increasing interest in this subject (Sousa (Sousa et al., 2008). Exporting is a fundamental strategy in ensuring firm’s survival or growth, and firms may achieve competitive advantage in international markets with a
positive influence on current and future export performance ( Navarro et al., 2009) 2009) and so, many companies have allocated a more attention and resources in order to export their products to foreign markets (Julian, O’Cass, 2003; Julian, O’Cass, 2002a; Lages, 2003; Navarro et al., 2009 ). Marketing strategy is one of the major elements of export performance and one of the key factors impacting export performance (Cavusgil, (Cavusgil, Zou 1994; Thirkell, Dau, 1998; Lee, Griffith, 2004; Brodrechtova, 2008; Salavou, Halikias, 2008). 2008). Researches on the significance of the marketing showed a strong association between export marketing strategy and export performance; a positive and direct impact of marketing strategy on export performance of the firms in question ( Mohamad et al., 2009; Mavrogiannis et al., 2008; Lages, lages, 2003; Julian, O’Cass, 2003; Leonidus et al., 2002; Cavusgil, Zou, 1994). 1994). Salavou and Halikias (2008 ( 2008), ), in their study, also found that the majority of exporter companies that obtained higher profitability, was due to their marketing-based strategies. In contrast, researchers such as Julian, (2003 ( 2003); Julian and O’Cass, (2003 2003)) concluded that export marketing strategies had no effect onto export performance. Also in the research by Abdul Adis and Md.Sidin, (2010 2010)) revealed that there were no direct or significant relationship between export marketing strategy (concluding product adaption, promotion adaption, distribution strategy, design strategy, price competitiveness, support to foreign distributer, target market speci fication) and export performance of Malaysian wooden furniture industry. In brief, although a few studies mention there is not any relationship, most of researchers concluded that marketing strategy had significant positive effects on export performance and it was an important part of studies that had been evaluated many times previously. SME’s: Impact of marketing strategies strategies on profitability of SME’s
Mazzarol (2000 (2000)) observed that “at the commencement of the new millennium, small businesses are being heralded as the engine of economic growth, the incubator of innovation, and the solution to decades of persistent unemployment the fulfilment of the enormous potential of the sector has been a consistent theme since the commencement of industrial revolution”. In both developing and developed countries, promoting small and medium-sized enterprises (SMEs) is one of the most viable strategies for achieving national development goals such as economic development, strengthening the industrial base and local production structure (Hallberg, ( Hallberg, 2000). 2000). Most of the academic literature and empirical studies relating to organizational behaviour in SMEs are based upon data gathered in developed countries. Previous research outcomes ought to be cross-validated and put into another perspective when studying SMEs in a developing country (Liargovas, ( Liargovas, 1998). 1998). There appears to be little doubt that small businesses do make a large net contribution to the creation of new jobs compared with large businesses (Birch ( Birch 1979). 1979). Marketing is a contentious issue among both academics and practitioners when it comes to SME ’s (Gilmore et al., 2001; Siu and Liu, 2005; Chiliya et al., 2009). 2009 ). Marketing theory development in SMEs has been somewhat limited and often relies on the application of classical marketing models to smaller businesses (Chaston (Chaston and Mangles, 2002). 2002). Empirical support for the relationship between the marketing strategy and financial performance of a business has been provided by a number of studies. The majority of these studies have been based on the Profit Impact of Marketing Strategy and have focused on company performance in USA (Faria ( Faria and Wellington, 2005; Kyle, 2004). Various studies by Shim et al., (2004 ( 2004), O’Neill et al., (2002 2002)) and Patterson and Smith (2001 (2001)) have suggested that overall business performance is influenced by the marketing strategy. However, the results of the aforementioned studies are inconclusive. According to Chiliya et al., (2009 (2009), ), taking the South African context, Cant and Brink (1999 (1999)) studied the marketing perceptions of grocery shop owners whilst Martins ( 2000 2000)) studied the retail strategies based on the income and expenditure patterns of consumers. According to Chiliya et al., (2009 ( 2009), ), study revealed important shortcomings in the marketing knowledge and practises of SME’s (Small and medium enterprises) owners/man agers in Mdantsane, East London making what few strategies implemented as a failure. However, this is not the case in
other countries; prime examples being the United Kingdom, Philippine, Australia (Mazzarol. ( Mazzarol. T., T., 2000; Mitra J., and H. Matlay, 2000), 2000 ), Srilanka (R. (R. Gajanayake 2010), 2010), China (Shigang (Shigang Yan., and David A. S. Chew 2011), 2011 ), Egypt (Amira (Amira Kazem., and Beatrice vander Heijden 2006) 2006 ) while Holand, Germany and France were included in this category with the help of Covin, J.G., and Slevin, D.P. ’s (1991 1991)) rather detailed paper. The fact, according to various researches, that SMEs appear to be more efficient users of capital is suggestive but not conclusive evidence in this respect. And, on the contrary, some studies show that small firms are less capital-efficient than medium or large units. Conclusion:Conclusion:Although strategies provide a firm with a plan of action, the struggle does not end there. A constant strife to implement the best strategy available, tweak it or integrate two or more strategies together, are some of the things that need to be done. For all this to be viable the firm needs to have a dedicated working unit. The marketers, the strategy makers as well as the manager, before implementing or introducing new methods/strategies, need to remember what is truly important for the long term benefit of the firm; the idea and needs of their customers. Amongst various strategies, this paper will concentrate on the three discussed above, briefly. All of them are viable, provided some minor amendments are made to suit the region and the firm. Bigger firms can use, what influence they have over the region, and convince governments to be more accommodating towards some portions of a certain strategy. An example of this could be the strict regulation enforced by some countries on clothing made of animal skin. However, some of the big corporations still have their license for making such cloth wear. The market for such items is small and so they have to cater to every customer. With some countries not allowing them an inch of leniency, the company has no option but to resort to alternate/illegal means to satisfy their customers. Pertaining to new strategies further research could be undertaken with regards to firm’s reactive behaviour as suggested by Lages and Montgomery (2004 ( 2004)) which will help to achieve deeper understanding in firm and customer behaviour which, in turn, will help to implement marketing strategies to the new age.
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