Chapter # 2
Developing Marketing
Strategies and Plans

Marketing and Customer
Value
The task of any business is to deliver customer value at a
profit. A company can win only by fine-tuning the value
delivery process and choosing, providing and
communicating superior value to increasingly well-
informed buyers.

Marketing and Customer
Value
The Value Delivery Process
Value creation and delivery sequence into three phases:
 Choosing the value (STP)
 Providing the value
 Communicating the value

Marketing and Customer
Value
The Value Chain
Michael porter has proposed the value chain as a tool for
identifying ways to create more customer value.

Marketing and Customer
Value
The Value Chain

Marketing and Customer
Value
The Value Chain
Core business process
• The market-sensing process
• The new-offering realization process
• The customer acquisition process
• The customer relationship management process
• The fulfillment management process

Marketing and Customer
Value
Core Competencies
It has three characteristics
1. It is a source of competitive advantage
2. It has application in a wider variety of markets
3. It is difficult for competitors to imitate

Marketing and Customer
Value
The Central Role of Strategic Planning

Corporate and Division
Strategic Planning
Corporate headquarters undertake four planning activities
1. Defining the corporate mission
2. Establishing strategic business units
3. Assigning resources to each strategic business unit
4. Assessing growth opportunities

Corporate and Division
Strategic Planning
Define Corporate Mission
An organization exist to accomplish something.
To define its mission, a company should address following questions.
What is our business?
Who is our customers?
What is of value to the customer?
What will our business be?
What should our business be?

Corporate and Division
Strategic Planning
Crafting A Mission Statement
Mission statement developed collaboratively with and shared with managers, employees
and often customers.
Good mission statement have five characteristics.
Focus on limited number of goals
Stress the company’s major policies
Define the major competitive sphere within which company will operate.
Take long term view
Short, memorable and meaningful

Corporate and Division
Strategic Planning
Corporate headquarters undertake four planning activities
1. Defining the corporate mission
2. Establishing strategic business units
3. Assigning resources to each strategic business unit
4. Assessing growth opportunities

Corporate and Division
Strategic Planning
Establishing Strategic Business Units
Large companies normally manage quite different business, each requiring its
own strategy. SBU’s have three characteristics.
It is a single business or collection of related businesses that can be planned
separately.
It has its own set of competitors.
It has a manager responsible for strategic planning and profit performance.

Corporate and Division
Strategic Planning
Corporate headquarters undertake four planning activities
1. Defining the corporate mission
2. Establishing strategic business units
3. Assigning resources to each strategic business unit
4. Assessing growth opportunities

Corporate and Division
Strategic Planning
Assigning Resources to Each SBU
GE/Mckinsey Matrix

Corporate and Division
Strategic Planning
BCG Matrix

Corporate and Division
Strategic Planning
Corporate headquarters undertake four planning activities
1. Defining the corporate mission
2. Establishing strategic business units
3. Assigning resources to each strategic business unit
4. Assessing growth opportunities

Corporate and Division
Strategic Planning
Assessing Growth Opportunities
Intensive Growth – Identify opportunities for improving existing business.
Product market expansion grid

Corporate and Division
Strategic Planning
Integrative growth – identify opportunities to build or acquire business that are
related to current business (e.g backward, forward integration or horizontal)
Diversification growth – identify opportunities to add businesses unrelated to
current business.

Corporate and Division
Strategic Planning
Downsizing and Divesting Older Businesses
Companies must carefully harvest or divest tired old businesses to release
needed resources for other uses and reduce costs.

Corporate and Division
Strategic Planning
Organization and Organizational Culture
A company organization consist of its structure, policies and
corporate culture, all of which become dysfunctional in
rapidly changing business environment.
Shared experiences, stories, beliefs and norms that
characterize an organization is know as organizational
culture.

Business Unit Strategic
Planning

Business Unit Strategic
Planning
The Business Mission
Each business unit needs to define its specific mission within the broader company mission.
SWOT Analysis
Goal Formulation
Objectives must meet the following criteria
They must be arranged hierarchically, form the most important to least important.
Objectives should be quantitative whenever possible
Objectives should be realistic
Objectives must be consistent

Business Unit Strategic
Planning
Strategic Formulation
Porters Generic Strategies
Overall cost leadership
Differentiation
Focus
Strategic Alliances
Product or services alliances
Promotion alliances
Logistics alliances
Pricing collaboration

Business Unit Strategic
Planning
Program Formulation and Implementation
Feedback and Control