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  • 1. CHAPTER TWO STRATEGIC PLANNING DEVELOPING AND IMPLEMENTING A MARKETING PLAN Prepared by: Jack Gifford Miami University (Ohio)
  • 2. STRATEGIC PLANNING
    • Strategic Planning is the managerial process of creating and maintaining a fit between the organization’s objectives and resources and the evolving market opportunities.
    RESOURCES & OBJECTIVES EVOLVING MARKET OPPORUNITIES LONG RUN PROFITABILITY AND GROWTH PLUS
  • 3. STRATEGIC PLANNING
    • Strategic planning requires the long-run commitment of human and capital resources.
    • Strategic marketing management addresses two questions:
      • What is the organization’s main activity at a particular time?
      • What are its primary goals and how will these be achieved?
    • How do companies go about strategic planning? How do employees know how to implement the long-term goals of the firm? The answer is…...
  • 4. A MARKETING PLAN
    • Is the process of anticipating events and determining strategies to achieve organizational objectives in the future.
    • A written document
    • A guideline over time
    • Benchmark of progress to date
    • The components of a Marketing Plan always should include, at a minimum, the following...
  • 5. THE MARKETING PLAN CONTAINS, AT A MINIMUM….
    • Business Mission Statement
    • Objectives
    • Situation Analysis (SWOT)
    • Marketing Strategy
      • Target Market Strategy
      • Marketing Mix
        • Product
        • Promotion
        • Price
        • Distribution
    • Implementation, Evaluation and Control
  • 6. ...AND ALSO OFTEN INCLUDES:
    • Budgets
    • Implementation timetables
    • Required marketing research efforts
    • Other elements of advanced strategic planning
      • Quality control programs
      • Supply chain management systems
      • Organizational structure changes
      • Management Information Systems
      • Others unique to specific industries
  • 7. THE MISSION STATEMENT
    • When we answer the question “What business are we in and where are we going?” we are well on our way to creating a mission statement
      • The creation and implementation of a mission statement profoundly affects long-run resource allocation, profitability, and survival.
      • Includes the long-run vision and values of the company
      • Must be customer oriented
      • May be for the entire business, or each strategic business unit (SBU)
      • Must not be too broad…or too narrow in scope
      • Avoids marketing myopia
  • 8. MARKETING MYOPIA
    • A business that defines itself in terms of its products or services instead of customer satisfaction or too narrowly instead of the markets, organizations, and benefits purchased.
    AT&T = Telephones Communication Systems
  • 9. MARKETING GOALS AND OBJECTIVES
    • Marketing Objectives
      • What is to be accomplished through marketing activities
      • Realistic, measurable, time specific
      • Internally consistent
      • Indicate the priorities of the organization
  • 10. MARKETING GOALS AND OBJECTIVES
    • Marketing objectives serve several functions
      • Communicate marketing management philosophies
      • Provide direction for lower-level management
      • Act as motivators
      • Help clarify executive thinking
      • Create a series of benchmarks and a basis for control
  • 11. CONDUCT A SITUATION ANALYSIS
    • Environmental Scan/ Situational Analysis
    • Two major components, the first set being...
      • Internal strengths
      • Internal weaknesses
    • Production costs
    • Marketing and people skills
    • Financial resources
    • Company or brand image
    • Available technology
    • Other
  • 12. CONDUCT A SITUATION ANALYSIS
    • Environmental Scan/ Situational Analysis
    • Two major components, the second set being…
      • External Opportunities
      • External Threats
    • MACROENVIRONMENTAL FORCES INCLUDE
    • Social forces
    • Demographic forces
    • Economic forces
    • Technological forces
    • Political forces
    • Legal forces
    • Competitive forces
  • 13. Corporate culture and the external opportunities and threats
    • Corporate culture is the pattern of basic assumptions an organization has accepted to cope with the firm’s internal environment and the changing external environment
      • It is revealed by the way it reacts to problems and opportunities
      • These organizational responses can be categorized into four types
  • 14. FOUR TYPES OF ORGANIZATIONAL RESPONSES TO EXTERNAL OPPORTUNITIES AND THREATS
    • Prospector
    • Reactor
    • Defender
    • Analyzer
    • Focuses on identifying and capitalizing on emerging market opportunities; emphasizes mkt. research & communications
    • Responds to emerging market forces when forced to do so
    • Tries to defend its “turf” or market domain
    • Combination of a conservative prospector and aggressive defender
  • 15. STRATEGIC WINDOW
    • Is the limited time period in which there is an optimal FIT between external market O pportunities and internal corporate S trengths
    SWOT Optimal match
  • 16. STRATEGIC OPPORTUNITIES MATRIX EXAMPLE: DAIMLER-CHRYSLER PRODUCT MARKET PRESENT NEW PRESENT NEW Market Penetration Market Development Product Development Diversification
  • 17. PORTFOLIO MATRIX EXAMPLE: MICROSOFT CORPORATION MARKET SHARE DOMINANCE MARKET GROWTH RATE HIGH LOW LOW HIGH ?
  • 18. PORTFOLIO MATRIX (continued) Allocating future resources for each
    • Build
      • Invest in a problem child that has the potential to become a star
    • Hold
      • Hold and protect; use cash flow to maintain market share
    • Harvest
      • Increase short-term cash flow from any source except stars
    • Divest
      • Sell off or close dogs and sometimes problem children that cannot be converted to stars
  • 19. MARKET ATTRACTIVENESS / STRENGTH MATRIX: EXAMPLE KODAK CORPORATION BUSINESS POSITON [ STRENGTH MINUS WEAKNESSES ] MARKET ATTRACTIVENESS [ OPPORTUNITIES MINUS THREATS ] LOW MEDIUM HIGH STRONG MEDIUM WEAK
  • 20. MARKET ATTRACTIVENESS / STRENGTH MATRIX (CONTINUED)
    • To maintain a strong business position in an attractive market (SMILEY FACE), a company must develop a sustainable competitive advantage
      • One or more unique aspects of an organization that are valued by the target market(s) and cannot be easily replicated by competition
        • Superior skills, such as management capabilities and expertise)
        • Superior resources( well known brand name, patents, unique technology, or superior economies of scale)
  • 21. DIFFERENTIAL ADVANTAGE
    • Important to target market(s)
    • Why you purchase “A” instead of “B”
    • Athletic Shoes ???
    • Soft drink ???
    Sustainable competitive advantage
  • 22. MARKETING PLAN (continued)
    • Marketing Strategy
      • Target Market Strategy
        • Identifies which market segment or segments to focus on
        • This topic will be discussed in detail in Chapter 7
    Owners of pets Male business executives Parents of children under 3
  • 23. TARGET MARKET STRATEGY
    • How do we “cluster” potential customers for our products or services around meaningful buying attributes?
    • Is usually multidimensional
          • SAUDI KINGDOM SHOPPNG CENTRE?
          • TREK BICYCLES?
    MEN 1ST FLOOR WOMEN 2ND FLOOR ???
  • 24. MARKETING PLAN (continued)
    • Marketing Mix: The 4 “Ps”
      • Product strategies
      • Price strategies
      • Promotion strategies
      • Distribution strategies (Place)
    Gillette Mach 3 razor
    • New triple cutting surface
    • Sold through retailers
    • Introductory price $3.29
    • Promoted on TV, magazines and newspapers
  • 25. THE MARKETING MIX PRODUCT OR SERVICE PRICE PROMOTION PLACE
  • 26. IMPLEMENTATION, EVALUATION AND CONTROL
    • Implementation
      • The process that turns marketing plans into action assignments
      • Assures execution in a way that accomplishes the plans’ objectives
    • Evaluation and control
      • Gauging the extent to which marketing objectives have been achieved during the specific time period.
  • 27. EVALUATION AND CONTROL
    • The broadest control device available to marketing managers is the marketing audit
    • A marketing audit is a comprehensive , systematic , periodic , and independent evaluation of the goals, strategies, structure, and performance of the marketing organization
    AUDIT
  • 28. EFFECTIVE STRATEGIC PLANNING
    • Effective strategic planning requires continual attention, creativity, and management commitment
      • Should be an ongoing process
      • Is based on information and creativity
      • Requires top management support and participation
  • 29. FOUR COMMON REASONS FOR FAILURE TO ACHIEVE MARKETING OBJECTIVES
    • Objectives were unrealistic
    • Inappropriate objectives for the plan
    • Poor implementation
    • Unanticipated changes in the internal or external environments
    • Violations of any of the three principles of effective strategic planning

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