Most often, this marketing strategy is chosen when a company needs to regroup its forces after a long period of growth or when it needs to maximize efficiency in the event of serious economic upheavals. As a rule, they do not pass painlessly for the company.
It is important to understand that these are the same development strategies as those related to growth, discussed above. If the goal is to reduce the business, then 4 types of MS are used:
Liquidation strategy – used as a last resort when the company is no longer able to operate.
The "Harvest" strategy is when an organization gives up long-term prospects in favor of maximizing profits that can be obtained in the near future. As a rule, this MS is used when the business is unpromising, it is difficult to sell it at a high price, but at the same time it brings in a good income in a certain season, for example, during the "harvest".
It involves reducing costs for hired labor, purchasing, maximizing income from selling off available goods, and continuing to reduce production.
The downsizing strategy consists of closing one of the structural divisions of the enterprise or selling it with the aim of changing the boundaries of its business in the future.
Cost reduction strategy – similar student database to the previous one, because its main goal is also to find ways to minimize costs, as well as to carry out measures that lead to cost reduction. It is implemented by reducing production costs, reducing labor force, increasing productivity, stopping the production of goods that are unprofitable, and eliminating production facilities that do not bring benefits.
Marketing strategies are rarely found in practice in their pure form. In most cases, different directions are combined taking into account the changing situation. If the marketing strategy is monotonous, the market will get used to it rather quickly and instead of achieving the set goals, a crisis situation may occur.
Recommended articles on this topic:
9 Types of Customer Loyalty Programs
What should ideal B2B marketing be like?
Example of a cooperation proposal: just follow the instr