Describe the role of strategic marketing in the value chain
Strategic marketing can play a key role in various parts of the value chain.
From the perspective of the supplier of the raw materials, strategic marketing is important in setting off the supplier's products as different than the products of other suppliers. If they are able to do this, then they may be able to capture more than the expected amount of value on the value chain. For instance, if a company has found a way to produce larger potatoes, then the company's products may be in more demand from restaurants who serve stuffed baked potatoes as a menu item.
From a manufacturer's perspective, strategic marketing should be a key role in product development so that the products are designed to fulfill specific consumer needs. This will help the company maximize the value it receives as the buyers/distributors will want to stock the product. For example, if Betty Crocker makes the largest variety of frosting types, a grocery store, such as Jewel, may carry more of Betty Crocker's products. In some cases, the store may even make the manufacturer the "category manager" and allow that company to design how the entire category is displayed. For example, Betty Crocker could be the frosting category manager and display all of its products and maybe none or a limited amount of its competitors. This ensures stronger distribution of the manufacturer's product and helps to capture more value.
A buyer using strategic marketing will try to match the products it sells to the end-consumer with the needs of the end-consumer. For example, a discount store will want to stock its shelves with the lowest-price items that its consumers want. If the buyer is successful in matching its inventory with consumer needs, it will enable the retailer to gain more value on the chain.
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