Chapter 2

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  • This figure shows that marketing and business plans may be targeted at an (1) internal audience to be used to help direct the firm or (2) external audience to try to raise capital. Each combination has slightly different elements. See SLN 2-4.
  • Chapter 2

    1. 1. DEVELOPING SUCCESSFUL MARKETING AND CORPORATE STRATEGIES C HAPTER
    2. 2. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: <ul><li>Describe the three organizational levels of strategy. </li></ul><ul><li>Describe why business, mission, organizational culture, and goals are important in organizations. </li></ul><ul><li>Explain how organizations set strategic directions by assessing where they are now and seek to be in the future. </li></ul>
    3. 3. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: <ul><li>Describe the strategic marketing process and its three key phases: planning, implementation, and control. </li></ul><ul><li>Explain how the marketing mix elements are blended into a cohesive marketing program. </li></ul>
    4. 4. WHERE CAN AN “A” IN ICE CREAM MAKING LEAD?
    5. 5. ORGANIZATIONS AND THEIR LEVELS OF STRATEGY <ul><li>Profit </li></ul><ul><li>Business Firm </li></ul><ul><li>Kinds of Organizations </li></ul><ul><li>Nonprofit Organization </li></ul><ul><li>Firm, Company, Corporation, Organization </li></ul>
    6. 6. <ul><li>Levels in Organizations and How Marketing Links to Them </li></ul><ul><li>Corporate Level </li></ul><ul><li>Strategic Business Unit (SBU) </li></ul><ul><li>Functional Level </li></ul><ul><li>Business Unit Level </li></ul>ORGANIZATIONS AND THEIR LEVELS OF STRATEGY <ul><li>Department </li></ul>
    7. 7. FIGURE 2-1 The three levels of strategy in organizations: corporate, business unit, and functional
    8. 8. <ul><li>Strategy Issues in Organizations </li></ul><ul><li>The Business </li></ul><ul><li>The Mission (Mission Statement/Vision) </li></ul><ul><li>Organizational Culture </li></ul><ul><li>Stakeholders </li></ul><ul><li>Organizational Culture </li></ul>ORGANIZATIONS AND THEIR LEVELS OF STRATEGY
    9. 9. Medtronic’s “Rising Figure” Mural What does it signify to stakeholders?
    10. 10. <ul><li>Strategy Issues in Organizations </li></ul><ul><li>Goals or Objectives </li></ul><ul><li>Profit </li></ul><ul><li>Sales </li></ul><ul><li>Market Share </li></ul><ul><li>Quality </li></ul><ul><li>Customer Satisfaction </li></ul><ul><li>Employee Welfare </li></ul><ul><li>Social Responsibility </li></ul>ORGANIZATIONS AND THEIR LEVELS OF STRATEGY
    11. 11. Concept Check 1. What are the three levels in today’s large organizations? <ul><ul><li>A: The corporate, business unit, and functional levels exist in large corporations. </li></ul></ul>
    12. 12. Concept Check 2. What is the meaning of an organization’s mission? <ul><ul><li>A: Mission is a statement of the organization’s scope, often identifying its customers, markets, products, technology, and values. </li></ul></ul>
    13. 13. Concept Check 3. How do an organization’s goals relate to its mission? <ul><ul><li>A: Goals or objectives measure how well the organization’s mission is being accomplished. </li></ul></ul>
    14. 14. SETTING STRATEGIC DIRECTIONS <ul><li>Competencies </li></ul><ul><li>A Look Around: Where Are We Now? </li></ul><ul><li>Customers </li></ul><ul><li>Competitive Advantage </li></ul><ul><li>Competitors </li></ul>
    15. 15. Lands’ End Unconditional Guarantee What is the strategic focus?
    16. 16. SETTING STRATEGIC DIRECTIONS <ul><li>Growth Strategies: Where Do We Want to Go? </li></ul><ul><li>Business Portfolio Analysis (BCG) </li></ul><ul><li>Relative Market Share </li></ul><ul><li>Market Growth Rate </li></ul><ul><li>Stars </li></ul><ul><li>Cash Cows </li></ul><ul><li>Dogs </li></ul><ul><li>Question Marks or Problem Children </li></ul>
    17. 17. FIGURE 2-2 Boston Consulting Group portfolio analysis for Kodak, as it might appear in 2006 Kodak self- service kiosk Kodak film sales: US, Canada, & W. Europe Kodak digital photo printer Kodak digital camera
    18. 18. Kodak Traditional Film Cartridge What SBU type in the BCG growth-share matrix?
    19. 19. Kodak Digital Camera What SBU type in the BCG growth-share matrix?
    20. 20. Kodak Digital Photo Printer What SBU type in the BCG growth-share matrix?
    21. 21. Kodak Picture Maker Self-Service Kiosk What SBU type in the BCG growth-share matrix?
    22. 22. SETTING STRATEGIC DIRECTIONS <ul><li>Growth Strategies: Where Do We Want to Go? </li></ul><ul><li>Market-Product Analysis </li></ul><ul><li>Market Penetration </li></ul><ul><li>Market Development </li></ul><ul><li>Product Development </li></ul><ul><li>Diversification </li></ul>
    23. 23. FIGURE 2-3 Four market-product strategies: alternative ways to expand sales revenues for Ben & Jerry’s
    24. 24. Concept Check 1. What are competencies and why are they important? <ul><ul><li>A: Competencies are an organization’s special capabilities, including skills, technologies, and resources that distinguish it from other organizations, which if exploited, can lead to the organization’s success . </li></ul></ul>
    25. 25. Concept Check 2. What is business portfolio analysis? <ul><ul><li>A: Business portfolio analysis studies a firm’s business units as though they were a collection of separate investments. </li></ul></ul>
    26. 26. Concept Check 3. What are the four market-product strategies? <ul><ul><li>A: (1) market penetration; (2) market development; (3) product development; and (4) diversification. </li></ul></ul>
    27. 27. THE STRATEGIC MARKETING PROCESS <ul><li>Strategic Marketing Process </li></ul><ul><li>How do we allocate our resources to get where we want to go? </li></ul><ul><li>How do we convert our plans to actions? </li></ul><ul><li>How do our results compare with our plans, and do deviations require new plans? </li></ul><ul><li>Marketing Plan </li></ul>
    28. 28. FIGURE 2-4 The strategic marketing process
    29. 29. <ul><li>Strategic Marketing Process: The Planning Phase </li></ul><ul><li>Step 1: Situation (SWOT) Analysis </li></ul><ul><li>Situation Analysis </li></ul><ul><li>SWOT Analysis </li></ul><ul><li>O pportunities </li></ul><ul><li>S trengths </li></ul><ul><li>T hreats </li></ul><ul><li>W eaknesses </li></ul>THE STRATEGIC MARKETING PROCESS
    30. 30. FIGURE 2-5 Ben & Jerry’s: a SWOT analysis to get it growing again
    31. 31. Ben & Jerry’s One Sweet Whirled Campaign What is the impact of a SWOT analysis?
    32. 32. <ul><li>Strategic Marketing Process: The Planning Phase </li></ul><ul><li>Step 2: Market-Product Focus and Goal Setting </li></ul><ul><li>Market Segmentation </li></ul><ul><li>Set Marketing and Product Goals </li></ul><ul><li>Select Target Markets </li></ul><ul><li>Find Points of Difference </li></ul><ul><li>Position the Product </li></ul>THE STRATEGIC MARKETING PROCESS
    33. 33. Medtronic’s Champion Heart Pacemaker What features are important to the Asian market?
    34. 34. <ul><li>Strategic Marketing Process: The Planning Phase </li></ul><ul><li>Step 3: Marketing Program </li></ul><ul><li>Product Strategy </li></ul><ul><li>Price Strategy </li></ul><ul><li>Promotion Strategy </li></ul><ul><li>Place (Distribution) Strategy </li></ul>THE STRATEGIC MARKETING PROCESS
    35. 35. FIGURE 2-6 Elements of the marketing mix that comprise a cohesive marketing program
    36. 36. Concept Check 1. What is the difference between a strength and an opportunity in a SWOT analysis? <ul><ul><li>A: Both are positive factors for the organization, but a strength is an internal factor whereas an opportunity is an external one. </li></ul></ul>
    37. 37. Concept Check 2. What is market segmentation? <ul><ul><li>A: Market segmentation involves aggregating prospective buyers into groups, or segments, that (1) have common needs and (2) will respond similarly to a marketing action. </li></ul></ul>
    38. 38. Concept Check 3. What are points of difference and why are they important? <ul><ul><li>A: Points of difference are those characteristics of a product that make it superior to competitive substitutes. They are the single most important factor in the success or failure of a new product. </li></ul></ul>
    39. 39. <ul><li>Strategic Marketing Process: The Implementation Phase </li></ul><ul><li>Obtaining Resources </li></ul><ul><li>Designing the Marketing Organization </li></ul><ul><li>Developing Schedules </li></ul>THE STRATEGIC MARKETING PROCESS
    40. 40. FIGURE 2-7 Organization of a typical manufacturing firm showing a breakdown of the marketing department
    41. 41. <ul><li>Strategic Marketing Process: The Implementation Phase </li></ul><ul><li>Executing the Marketing Program </li></ul><ul><li>Marketing Strategy </li></ul><ul><li>Marketing Tactics </li></ul>THE STRATEGIC MARKETING PROCESS
    42. 42. Kodak EasyShare Cameras in China What marketing strategy & tactics are used?
    43. 43. <ul><li>Strategic Marketing Process: The Control Phase </li></ul><ul><li>Comparing Results With Plans to Identify Deviations </li></ul><ul><li>Acting on Deviations </li></ul><ul><li>Planning Gap </li></ul><ul><li>Exploiting a Positive Deviation </li></ul><ul><li>Correcting a Negative Deviation </li></ul>THE STRATEGIC MARKETING PROCESS
    44. 44. FIGURE 2-8 Evaluation and control of Kodak’s marketing program
    45. 45. Concept Check 1. What is the control phase of the strategic marketing process? <ul><ul><li>A: This is the phase that seeks to keep the marketing program moving in the direction set for it. </li></ul></ul>
    46. 46. Concept Check 2. How do the objectives set for a marketing program in the planning phase relate to the control phase of the strategic marketing process? <ul><ul><li>A: The planning phase objectives are used as the benchmarks to which the actual performance results are compared in the control phase. </li></ul></ul>
    47. 47. MEDTRONIC’S MISSION STATEMENT GOING ONLINE
    48. 48. <ul><ul><li>1. What stakeholders are specifically mentioned or implied in Medtronic’s mission? What values are associated with each stakeholder? </li></ul></ul>Going Online
    49. 49. <ul><ul><li>2. What is the scope of Medtronic’s mission? Why does Medtronic limit its scope? </li></ul></ul>Going Online
    50. 50. <ul><ul><li>3. Why does Medtronic NOT define itself as being in the “medical device” business? </li></ul></ul>Going Online
    51. 51. BP: ALLOCATING RESOURCES TO BRING YOU GASOLINE AND FRESH BREAD! VIDEO CASE 2
    52. 52. VIDEO CASE 2 BP
    53. 53. VIDEO CASE 2 BP <ul><ul><li>1. How does BP use its strategic marketing process to allocate resources to opportunities such as the BP Connect concept? Is BP Connect consistent with BP’s mission and values? Explain. </li></ul></ul>
    54. 54. VIDEO CASE 2 BP <ul><ul><li>2. Conduct a SWOT (strengths, weaknesses, opportunities, threats) analysis for the BP Connect concept—looking forward globally to the next three years. </li></ul></ul>
    55. 55. VIDEO CASE 2 BP <ul><ul><li>3. In addition to features such as high-tech pumps and twenty-first century information technology, what other marketing mix activities would you recommend as part of Step 3 of the planning phase? </li></ul></ul>
    56. 56. MARKETING VERSUS BUSINESS PLANS SUPPLEMENTAL LECTURE NOTE 2-1
    57. 57. FIGURE A-1 Elements in typical marketing and business plans targeted at different audiences
    58. 58. PLANNING VS. IMPLEMENTATION ISSUES SUPPLEMENTAL LECTURE NOTE 2-2
    59. 59. FIGURE 2-A Results of good and bad marketing planning and implementation
    60. 60. ORGANIZING FOR MARKETING SUPPLEMENTAL LECTURE NOTE 2-3
    61. 61. FIGURE 2-B Organization of a business unit in a typical consumer packaged goods firm, showing two product or brand groups
    62. 62. FIGURE 2-C Units with which the product manager and product group work
    63. 63. PROJECT SCHEDULING USING GANTT CHARTS SUPPLEMENTAL LECTURE NOTE 2-4
    64. 64. FIGURE 2-D Tasks to complete a term project
    65. 65. FIGURE 2-E Gantt chart for scheduling the term project
    66. 66. MARKETING YOURSELF IN-CLASS ACTIVITY 2-1
    67. 67. Yahoo!/Hot Jobs TV Ad
    68. 68. Sample Résumé
    69. 69. Sample Cover Letter
    70. 70. MARKETING PLANNING WORKSHEET IN-CLASS ACTIVITY 2-2
    71. 73. Profit <ul><ul><li>Profit is the reward to a business firm for the risk it undertakes in offering a product for sale. It is also the money left over after a firm’s total expenses are subtracted from its total sales. </li></ul></ul>
    72. 74. <ul><ul><li>Mission is a statement of the organization’s scope, often identifying its customers, markets, products, technology, and values. </li></ul></ul>Mission
    73. 75. <ul><ul><li>Organizational culture is a set of values, ideas, and attitudes that is learned and shared among the members of an organization . </li></ul></ul>Organizational Culture
    74. 76. <ul><ul><li>Goals or objectives convert the mission into targeted levels of performance to be achieved, often by a specific time. </li></ul></ul>Goals or Objectives
    75. 77. <ul><ul><li>Market share is the ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself. </li></ul></ul>Market Share
    76. 78. <ul><ul><li>The strategic marketing process is the approach whereby an organization allocates its marketing mix resources to reach its target markets. </li></ul></ul>Strategic Marketing Process
    77. 79. <ul><ul><li>A marketing plan is a road map for the marketing activities of an organization for a specified future period of time, such as one year or five years. </li></ul></ul>Marketing Plan
    78. 80. <ul><ul><li>Situation analysis involves taking stock of where a firm or product has been recently, where it is now, and where it is headed in terms of the organization’s plans and the external factors and trends affecting it. </li></ul></ul>Situation Analysis
    79. 81. <ul><ul><li>SWOT analysis is an acronym describing an organization’s appraisal of its internal S trengths and W eaknesses and its external O pportunities and T hreats. </li></ul></ul>SWOT Analysis
    80. 82. <ul><ul><li>Market segmentation involves aggregating prospective buyers into groups, or segments, that (1) have common needs and (2) will respond similarly to a marketing action. </li></ul></ul>Market Segmentation
    81. 83. <ul><ul><li>Points of difference are those characteristics of a product that make it superior to competitive substitutes. </li></ul></ul>Points of Difference
    82. 84. <ul><ul><li>A marketing strategy is the means by which a marketing goal is to be achieved, usually characterized by a specific target market and a marketing program to reach it. </li></ul></ul>Marketing Strategy
    83. 85. <ul><ul><li>Marketing tactics are detailed day-to-day operational decisions essential to the overall success of marketing strategies. </li></ul></ul>Marketing Tactics

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