Developing Marketing Strategies and Plans

DEVELOPING MARKETING STRATEGIES & PLANS Company and Marketing Strategy: Partnering to Build Customer Relationships

Planning
The process of anticipating future events and determining strategies to achieve organizational objectives in the future.
Strategic Planning
The process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities
The Nature of Strategic Planning

Strategic-Planning, Implementation, and Control Process Planning Measuring results Diagnosing results Taking corrective action Implementation Corporate planning Division planning Business planning Product planning Organizing Implementing Control

Four Steps of Organizational Strategic Plan
Defining the company mission
Setting company objectives and goals
Designing the business portfolio and
Planning the marketing and other functional activities.
Strategic planning covers the entire activities of the organization, including all of the strategic business units (SBUs) and each functional area.
Developing functional strategies and plans is the fourth step in the strategic planning process. One technique for identifying opportunities is to seek strategic windows.
A strategic window is the identification of an opportunity for a limited period in the future and managing the organization's resources so that there is a fit between the key market needs and the ability of the organization to meet those needs at an optimum level.

Strategic Business Units
(SBUs) Individual units within the firm that operate like separate businesses, with each having its own mission, business objectives, resources, managers, and competitors.

Characteristics of SBUs
It is a single business or collection of related businesses
It has its own set of competitors
It has a leader responsible for:
Strategic planning
Profitability
Efficiency

Planning at Different Management Levels
Strategic Planning Corporate Level Planning Strategic Business Unit(SBU) Planning
planning done by top level corporate managers
• Define corporate visions
• Set corporate goals
• Establish the business portfolio
Planning done by top level SBU managers
• Define the business mission
• Evaluate the environment (SWOT analysis)
» State business objectives
• Develop growth strategies
Tactical Planning
Planning done by Functional Area Managers; Human Resources Finance Operations Accounting Marketing
* Evaluate the marketing
environment « Set marketing
objectives « Develop marketing
strategies to achieve
corporate objectives
Operational Planning
Planning by Supervisory Managers: manager
manager
• Develop action plans to implement tactical plans

Three Levels of Planning
Tactical (Functional) Planning : A decision process that concentrates on developing detailed plans for strategies and tactics for the short term that support an organization's long-term strategic plan. Accomplished by various functional areas of firm.
Typically includes a broad 5-year plan to support strategic plan and a detailed annual plan
Example: to gain 40% of a particular market with three new products during coming year
Operational Planning: A decision process that focuses on developing detailed plans for day-to-day activities that carry out an organization's tactical plans. First-line managers focus on day-to-day execution of functional plans.
Such planning includes detailed annual, semiannual, or quarterly plans
Example: units of a product a salesperson needs to sell per month

Three Levels of Planning
Cross-Functional : An approach to tactical planning in which managers work together in developing tactical plans for each functional area in the firm so that each plan considers the objectives of the other areas.

The Value-Delivery Process (a) Traditional physical process sequence (b) Value creation & delivery sequence Sell the product Make the product Procure Design product Make Price Sell Advertise/ promote Distribute Service Choose the Value Provide the Value Tactical marketing Strategic marketing Communicate the Value

Strategic Planning at Co-operate Level
To develop strategic plans, top-level corporate managers follow three steps: 1. They develop a mission or vision for the total corporation,
2. Establish the corporation's long-term goals or objectives,
3. Allocate resources to the different SBUs to maximize growth and profits.

1. Mission Statement : A formal statement in an organization's strategic plan that describes the overall purpose of the organization and what it intends to achieve in terms of its customers, products, and resources. The Quaker Oats Company: To meet the needs of consumers through innovative marketing and manufacturing of healthful, good-tasting products that contribute to a healthy lifestyle and consumer well-being around the world, yielding above-average returns over time for our shareholders, (www.quakeroats.com/about/goal.htm)
Analysts use the term marketing myopia to describe firms that develop shortsighted visions

Market-Oriented Mission
A mission statement asks..
What is our business?
Who is the customer?
What do consumers value?
What should our business be?
A mission statement should be:
An “invisible hand”
Neither too narrow nor too broad
Fitting of market environment
Based on distinctive competencies
Motivating

Establishing Corporate Objectives: After constructing a mission statement, top management translates the corporation's mission into goals or objectives. These are specific accomplishments or outcomes that an organization hopes to achieve by a certain time.
Organizational objectives are a direct outgrowth of the mission statement and broadly identify what the firm hopes to accomplish within the general time frame of the firm's long-range business plan.
Planning for Growth: The Business Portfolio For companies with several different SBUs, strategic planning includes making decisions about how to best allocate resources among these businesses to ensure growth for the total organization.
Each SBU has its own focus within the firm's overall strategic plan, and each has its own target market and strategies for reaching its goals. Just like an independent business, each SBU is a separate profit center within a large corporation responsible for its own costs, revenues and profits.

Factors Influencing Company Marketing Strategy Target customers Competitors Marketing intermediaries Publics Suppliers Marketing information system Marketing planning system Marketing organization system Marketing organization and implementation Product Promotion Place Price Demographic/ economic environment Social/ cultural environment Technical/ physical environment Political/ legal environment

MARKETING PLANNING Company and Marketing Strategy: Partnering to Build Customer Relationships

The Business Portfolio
A business portfolio is the collection of businesses and products that make up the company
Business portfolio planning involves two steps:
Analyzing the current business portfolio
Shaping the future portfolio by developing strategies
Portfolio analysis: a management tool for evaluating a firms business mix and assessing the potential of an organizations strategic business units.

BCG Growth Market Share Matrix
A portfolio analysis model developed by the Boston consulting group that assesses the potential of successful product to generate cash that a firm can then use to invest in new products.
The vertical axis represents the attractiveness of the market, the market growth rate “high” and “low” as measurements, marketers might ask whether the total market for the product is growing 10 percent, 50 percent, 100 percent, or 200 percent annually. The horizontal axis shows the company’s current strength in the market through its relative market share. The marketers might ask whether the firm has 5 percent, 25 percent, or perhaps 75 percent of the current market. Combining the two axes creates four quadrants representing four different types of products or businesses.

3-7 Stars Cash cows Dogs Question marks High Low High Low COMPANY’S MARKET SHARE INDUSTRY GROWTH RATE

Each Cell in the Grid BCG Growth Share Matrix
Stars: Stars are SBUs with products that have a dominant market share in high-growth markets. Because the SBU has a dominant share of the market, stars generate large revenues, but they also require large amounts of funding to keep up with production and promotion demands. Because the market has a large growth potential, managers design strategies to maximize market share in the face of increasing competition.
Cash Cows: Cash cows have a dominant market share in a low-growth potential market. Because there's not much opportunity for new products, competitors don't‘ often enter the market. At the same time, the product is well established and enjoys a high market share that the firm can sustain with minimal funding. Firms usually milk cash cows of their profits to fund the growth of other products in a portfolio Of course, if the firm's goal is to increase revenues, having too many cash cows with little or no growth potential can become a liability.

Each Cell in the Grid BCG Growth Share Matrix
Question Marks: Question marks—sometimes called problem children—are products with low market shares in fast-growth markets. When a business unit is a question mark, it suggests that the firm has failed to compete successfully. Perhaps the product! offers fewer benefits than competing products. Maybe its price is too high, its distributors are ineffective, or its advertising is too weak. The firm could pump more money into marketing the product and hope that market share will improve. But the firm may find itself "throwing good money after bad," gaining nothing but a negative cash flow and disappointment.
Dogs: Dog lovers should not be offended; this label really refers to a mongrel—a product nobody wants. Dogs have a small share of a slow-growth market.

SWOT Analysis
An analysis of an organization’s strengths (S) and weaknesses (W) and the opportunities (O) and threats (T) in the external environment
All controllable elements inside a firm that influence how well the firm operates
Strengths and weaknesses
Technologies, physical facilities, financial stability, corporate reputation, quality products, strong brands, employees
Elements outside the firm that may affect it either positively or negatively
Opportunities and threats
The economy, competition, technology, law, ethics, and sociocultural trends
Firm cannot directly control external factors but can respond to them via planning

Analyzing the Current Business Portfolio
Build
Increase market share
Works well for question marks
Hold
Preserve market share
Good for cash cow
Harvest
Increases short-term cash flow
Good for weak cash cows, question marks and dogs
Divest
Sell or liquidate
Good for dogs and question marks

Marketing’s Role in Strategic Planning
Provide a guiding philosophy
Identify attractive opportunities
Design effective strategies
Build strong value chains
Form superior value delivery networks

Establish the Business Portfolio
Business portfolio: the group of different products or brands owned by an organization and having different income-generating and growth capabilities
Portfolio analysis: assessing the potential of a firm’s strategic business units
Helps decisions regarding which SBUs should receive more or less of the firm’s resources

Three Intensive Growth Strategies: Ansoff’s Product/Market Expansion Grid

Marketing Strategy
Customers grouped by:
Geographic
Demographic
Psychographic
Behavioral
Market segment is a groups of consumers who respond in similar ways to marketing efforts.
Market Segmentation
Target marketing
Market Positioning
Strategy

Marketing Strategy
Evaluation of each segment’s attractiveness
Selection of segments with greatest long-term profitability
A company can choose one or several segments to target
Strategy
Market Segmentation
Target marketing
Market Positioning

Marketing Strategy
The place the product occupies in the consumer’s mind
Products are positioned relative to competing products
Marketers look for clear, distinctive and desirable place in positioning
Strategy
Market Segmentation
Target marketing
Market Positioning

Managing the Marketing Effort
Finding opportunities
Avoiding threats
Understanding strengths
Analyzing weaknesses
Analysis
Planning
Implementation
Control
Marketing Functions

Marketing plans include:
Executive summary
Analysis of current situation
Objectives
Targets and positioning
Marketing mix
Budget
Controls
Marketing Functions
Analysis
Planning
Implementation
Control

Plans are turned into action with day-to-day activities
Good implementation is a challenge
Marketing Functions
Analysis
Planning
Implementation
Control

Evaluation of the results of marketing strategies
Checks for differences between goals and performance
Marketing Functions
Analysis
Planning
Implementation
Control

Measuring Effectiveness
Return on marketing (marketing ROI)
The net return from a marketing investment divided by the costs of the investments

Levels of a Marketing Plan
Strategic
Target marketing decisions
Value proposition
Analysis of marketing opportunities
Tactical
Product features
Promotion
Merchandising
Pricing
Sales channels
Service

Porter’s Generic Strategies
Overall cost leadership
Differentiation
Focus

http://www.slideshare.net	206
http://benson.org.ua	1
http://www.lmodules.com	1

Developing Marketing Strategies and Plans

by Khawaja Naveed on Feb 26, 2009

Accessibility

Categories

Tags

Upload Details

Usage Rights

3 Embeds 208

Statistics

Developing Marketing Strategies and Plans — Presentation Transcript