Marketing is any activity in business that is designed to acquire or keep customers. It therefore includes advertising, email campaigns, online content publication, and social media activity. However, what do we mean by the term ‘strategic marketing’? In particular, how can strategy be applied to marketing, and how can marketing contribute to business strategy?

This page unpacks the term, to explain more about the activities involved. It also discusses how businesses can develop the necessary skills.

Defining Strategic Marketing

There are many definitions of strategic marketing (see box).

Bringing these definitions together, strategic marketing is about:

• understanding your market, your customers and your products, and

• using that knowledge to support the business, and helping it to develop a sustainable competitive advantage.

Both these activities are delivered through marketing activities such as gathering and analysing information, and developing a marketing plan.

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Unpacking Strategic Marketing

Strategic marketing starts by answering three questions: where, how and when to compete.

The Chartered Institute of Marketing describes three important aspects of strategic marketing:

1. Strategic analysis

This is the process of gathering and analysing information to understand more about your market and your customers.

This enables you to develop insights into both, and particularly how you can deliver value to customers.

This process starts with gathering information—but not just any information. You need to seek out information that will provide the answers that you need about your market, including both your customers and your competitors.

There is more information about this process in our page on Gathering Information for Competitive Intelligence. You may also find it helpful to use a framework like Porter’s Five Forces or PESTLE to structure your intelligence-gathering.

You then need to turn the information into action, by using it to support decision-making.

For example, this knowledge will tell you where you can best compete, and how to approach your customers most effectively. There are two main elements of this: supporting organisational growth and supporting brand and product positioning.

2. Growth strategy

This is the part of strategic marketing that supports business growth.

It includes strategies to retain existing customers and increase customer loyalty. These might include improving the customer experience, or offering loyalty bonuses or reductions to valued customers. Customer segmentation is a useful tool here because it allows you to distinguish between customers, and identify those who are worth more to your company.

Growth strategy also includes expanding into new markets, and exploiting both new markets and new products to grow sales by acquiring new customers.

The Boston and Ansoff Matrices are tools designed to help organisations to think about their product portfolios and how to grow the business. They may be old—the Boston Matrix dates from the 1970s, and the Ansoff Matrix from the 1950s—but both still have a place in strategic marketing.

The Boston Matrix covers products, and enables businesses to explore their product portfolio by looking at growth potential. It considers both the growth potential for the market for the product, and the product’s position within that market.

The Ansoff Matrix covers potential strategies, including expanding into new products within existing markets, taking existing products into new markets, or developing new products for new markets, also known as differentiation. These vary by both risk and the skills required.

When you put together the two matrices, you can think strategically about which options to pursue for growth, depending on the level of risk you want to take.

3. Positioning strategy

This describes the ability to differentiate your product or brand so that it appeals to your customers and potential customers.

Marketers often use the 7 Ps of Marketing to consider differentiation. These are product, price, people, place, processes, promotion and physical evidence. Sometimes this is also known as the marketing mix, although that term is also used for the tactics and activities chosen for marketing.

Pricing is covered separately in our page on Pricing Strategies. You may also find it useful to read our page on Customer Segmentation, which discusses the process of distinguishing between groups of customers for marketing purposes.