TENTH EDITION

STRATEGIC

MARKET

MANAGEMENT

David A. Aaker
Vice-Chairman, Prophet
Professor Emeritus, University of California, Berkeley

WILEY
 CONTENTS

Strategie Market Management—An Introduction and Overview I

What Is a Business Strategy? 3
A Business Strategy 4
Strategie Market Management 9
Marketing and Its Role in Strategy 13

STRATEGIC ANALYSIS _17

External and Customer Analysis 19
External Analysis 19
The Scope of Customer Analysis 23
Segmentation 24
Customer Motivations 28
Unmet Needs 31
Competitor Analysis 37
Identifying Competitors—Customer-Based Approaches 38
Identifying Competitors—Strategie Croups 40
Potential Competitors 42
Competitor Analysis—Understanding Competitors 42
Competitor Strengths and Weaknesses 47
The Competitive Strength Grid 50
Obtaining Information on Competitors 53
Market/Submarket Analysis 55
Dimensions of a Market/Submarket Analysis 55
Emerging Submarkets 57
Actual and Potential Market or Submarket Size 58
Market and Submarket Growth 59
Market and Submarket Profitability Analysis 61
Cost Structure 64
Distribution Systems 65
Market Trends 65
Key Success Factors 66
Risks in High-Growth Markets 67
Environmental Analysis and Strategie Uncertainty 72
Technology Trends 74
Consumer Trends 77
Government/Economic Trends 81
Dealingwith Strategie Uncertainty 85
Impact Analysis—Assessing the Impact of Strategie Uncertainties 85
Scenario Analysis 87

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viii Contents

Chapter 6 Internal Analysis 91

Financial Performance and Profitability 92
Performance Measurement Beyond Profitability 94
Strengths and Weaknesses 99
Threats and Opportunities 99
From Analysis to Strategy 101
Case Challenges for Part I 103
Trends in Retailing 103
The Energy Bar Industry 105
Transformational Innovation« 108
Environmental Trends That Matter 110

PART TWO CREATING,ADAPTING, AND IMPLEMENTING STRATEGY 111

Chapter 7 Creating Advantage: Synergy and Commitment vs.
Opportunism vs. Adaptability 113
The Sustainable Competitive Advantage 114
The Role of Synergy 118
Strategic Commitment, Opportunism, and Adaptability 121
Chapter 8 Alternative Value Propositions 130
Business Strategy Challenges 131
Alternative Value Propositions 132
Superior Quality 138
Value 143
Chapter 9 Building and Managing Brand Equity 150
Brand Awareness 151
Brand Loyalty 152
Brand Associations 153
Brand Identity 159
Chapter 10 Toward a Strong Brand Relationship 106
Understanding and Prioritizing Brand Touchpoints 166
Focusing on the Customer's Sweet Spot 170
How to Create or Find a Customer Sweet Spot - 172
Get Beyond Functional Benefits 173
Broadening the Concept of a Brand 175
Chapter 11 Energizing the Business 181
Innovating the Offering 182
Energizing the Brand and Marketing 186
Increasing the Usage of Existing Customers 194
Chapter 12 Leveraging the Business 199
Which Assets and Competencies Can Be Leveraged? 200
Brand Extensions 201
Expanding the Scope of the Offering 205
New Markets 206
 Contents ix

Evaluating Business Leveraging Options 207

The Mirage of Synergy 209
Chapter 13 Creating New Businesses 213
Create "Must Haves," Rendering Competitors Irrelevant 214
The Innovators Advantage 217
M anaging Category Perceptions 219
Creating New Business Arenas 220
From Ideas to Market 225
Chapter 14 Global Strategies 230
Motivations Underlying Global Strategies 231
Standardization vs. Customization 235
Expanding the Global Footprint 239
Strategie Alliances 241
Global Marketing Management 244
Chapter 15 Setting Priorities for Businesses and Brands—The Exit, Milk,
and Consolidate Options 247
The Business Portfolio 248
Divestment or Liquidation 250
The Milk Strategy 253
Prioritizing and Trimming the Brand Portfolio 256
Chapter 16 From Silos to Synergy—Harnessing the Organization 263
Silo-Driven Problems—The Gase of Marketing 264
Addressing the Silo Marketing Issues—Challenges and Solutions 266
Organizational Levers and Their Link to Strategy 267
Structure 268
Systems 270
People 272
Culture 275
A Recap of Strategie Market Management 278
Case Challenges for Part II 282
Hobart Corporation 282
Dove 284
Competing Against Wal-Mart 287
Wegmans 290
Costco 291
Contemporary Art 292
Sonyvs. iPod 294
Appendix: Flanning Forms 296
Index 311